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HomeMy WebLinkAboutResolution Fort Worth Housing Finance Corporation (FWHFC) FWHFC-2019-07RESOLUTION NO. FWHFC-2019-07 FORT WORTH HOUSING FINANCE CORPORATION A RESOLUTION SETTING ASIDE $5 MILLION OF THE CORPORATION'S FUNDS FOR THE DEVELOPMENT OF PERMANENT SUPPORTIVE HOUSING IN THE CITY OF FORT WORTH WHEREAS, the City Council of the City of Fort Worth ("City") has adopted development and revitalization of the City's neighborhoods and affordable housing stock as a strategic goal, and City citizens and the City Council have determined that quality accessible affordable housing is needed for moderate, low and very low income City citizens; WHEREAS, the City Council created the Fort Worth Housing Finance Corporation (the "Corporation") in 1979 pursuant to the Texas Housing Finance Corporations Act, Chapter 394 of the Texas Local Government Code, to facilitate neighborhood revitalization and housing initiatives in the City, including but not limited to issuing tax exempt bonds, developing, rehabilitating and promoting housing, and assisting low to moderate income City citizens in acquiring quality, accessible, affordable housing through lending and construction activities; WHEREAS, in 2008 the City Council adopted Directions Home: Making Homelessness Rare, Short -Term, and Nonrecurring in Fort Worth, Texas within Ten Years as the City's official homelessness plan ( "Directions Home"). The City's homelessness plan, implemented by the Directions Home unit of the City Manager's Office, demonstrates the City Council's commitment to ending chronic homelessness in Fort Worth; WHEREAS, the City Council in 2014 appointed a Task Force on Permanent Supportive Housing and adopted Permanent Supportive Housing Guidelines and Recommendations in 2015 which included support for scattered site, single site and integrated models located near public transportation (City Council Resolutions No 4349-08-2014 and 4459-06-2015); WHEREAS, the Corporation, the Housing Authority of the City of Fort Worth d/b/a Fort Worth Housing Solutions, and Tarrant County Homeless Coalition agreed to share the costs of hiring a consultant to assist in the preparation of a strategic plan or framework for the development of affordable housing in the City. Other partners in developing the affordable housing plan include Tarrant County, the Tarrant County Housing Finance Corporation, Housing Channel, Fort Worth Area Habitat for Humanity, Inc. and Tarrant County Samaritan Housing; WHEREAS, the Board of Directors of the Corporation (the "Board") and the City Council both adopted Resolutions supporting the Fort Worth Affordable Housing Strategic Plan (Resolution No. FWHFC-2018-07 and Resolution No. 5026-2018); WHEREAS, the affordable housing strategy, now known as the Fort Worth Housing Strategic Framework Plan (the "Strategic Framework Plan"), includes a special focus on the creation of Permanent Supportive Housing for chronically homeless individuals and families as a RESOLUTION NO. FWHFC-2019-07 PAGE priority and identifies the Corporation and the City as funders and development partners for the creation of Permanent Supportive Housing units, and recommends guidelines for developers to qualify for City or Corporation funds for Permanent Supportive Housing projects; WHEREAS, Permanent Supportive Housing ("PSH") involves long term rental assistance and case management for individuals and families who have been homeless for over a year and are disabled, and Tarrant County needs 1,450 new units of PSH by 2026 to end chronic homelessness; WHEREAS, the Corporation has $5,000,000.00 in a restricted account which began as a result of a refund from certain single family bonds issued by the Corporation in the 1980s and 1990s which can be used as a source of forgivable loans approved by the Board to fund PSH projects that meet the following criteria: At least 20 PSH units per project No more than $25,000.00 of Corporation funds per PSH unit Foundations/grants to match Corporation funds dollar for dollar Forgivable, no interest loans evidenced by promissory notes and loan agreements, secured by mortgage liens 20-year performance period as PSH project Developers to furnish equity Project must be financially viable for entire 20-year performance period Project must meet acceptable underwriting criteria including project operations, sources and uses, ownership structure, developer financial strength All loans subject to Board approval WHEREAS, the Board desires to set aside $5,000,000.00 of the Corporation's funds from its restricted account for the purpose of funding the development of Permanent Supportive Housing. NOW THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE FORT WORTH HOUSING FINANCE CORPORATION: 1. THAT the Board authorizes the use of $5,000,000.00 of the Corporation's funds from its restricted account for the purpose of funding the development of Permanent Supportive Housing ("PSH") on the following terms and conditions: At least 20 PSH units per project No more than $25,000.00 of Corporation funds per PSH unit Foundations/grants to match Corporation funds dollar for dollar Forgivable, no interest loans evidenced by promissory notes and loan agreements, secured by mortgage liens 20-year performance period as PSH project Developers to furnish equity RESOLUTION NO. FWHFC-2019-07 PAGE 3 Project must be financially viable for entire 20-year performance period Project must meet acceptable underwriting criteria including project operations, sources and uses, ownership structure, developer financial strength All loans subject to Board approval 2. THAT Fernando Costa, General Manager of the Corporation, or Sonia Singleton, Assistant General Manager of the Corporation, or their duly appointed successors, are each authorized to execute and deliver loan commitments or similar documents for loans to fund the development of PSH projects prior to final Board approval on the terms and conditions set forth in Attachment I, and are each authorized to extend, modify and amend any such loan commitment or similar document, provided that any such extensions, modifications and amendments are within the scope of the proposed project, and in conformance with the goals and purposes of the Corporation, as may be amended from time to time. 3. THAT Fernando Costa, General Manager of the Corporation, or Sonia Singleton, Assistant General Manager of the Corporation, or their duly appointed successors, are each authorized to change, modify or amend the terms and conditions set forth in Attachment I in their discretion without prior Board approval, other than the terms and conditions of item 1 of this Resolution, provided that any such changes, modifications and amendments are in conformance with the goals and purposes of the Corporation, as may be amended from time to time THAT this Resolution takes effect from the date of its adoption. AND IT IS SO RESOLVED. Adopted October 22, 2019. FORT WWTH HOUSING FINANCE CORPORATION RESOLUTION NO. FWHFC-2019-07 PAGE 4 - ATTACHMENT 1 ATTACHMENT I TERMS AND CONDITIONS OF THE FORT WORTH HOUSING FINANCE CORPORATION FUNDING FOR DEVELOPMENT OF PERMANENT SUPPORTIVE HOUSING Loan Terms Lender: Fort Worth Housing Finance Corporation Borrowers: Entity qualified to do business in Texas. Must be experienced housing developer and have documented capacity to construct and operate multifamily housing that benefits low income households. Projects: Affordable or market rate housing projects with minimum of 20 PSH units. New construction or rehab acceptable. PSH Tenants Tenants for PSH units funded by Lender must be chronically homeless individuals referred through the Tarrant County Continuum of Care Coordinated Entry throughout the Performance Period. Loan Amount: TBD by underwriting Origination Fee: None Interest Rate: 0% Loan Term: Begins on date loan documents are executed. Matures 20 years from project stabilization Loan Documents: Loan Agreement, Promissory Note, Deed of Trust, and Guaranty (if applicable) Performance Units funded by Lender must remain PSH units for 20-year performance Period: period commencing at project stabilization Location: Within City corporate boundaries. Site use must be consistent with City's Comprehensive Plan Underwriting Must establish that project will be financially viable for entire 20-year performance period. Will include evaluating ownership structure, project operations, sources and uses of funds including cash flow analysis, developer's most recent financial statements and if applicable, financial statements from team members, any owners and guarantors Match: Foundations or other grant funds must match FWHFC funds dollar per dollar General Contractor: Acceptable to FWHFC RESOLUTION NO. FWHFC-2019-07 PAGE 5 - ATTACHMENT I PAGE 2 Guarantor: Payment and completion guarantees in form and substance acceptable to FWHFC required during construction period. If personal guarantees are required, must be acceptable to FWHFC in amount, form and substance Other Conditions: Pay all costs of loan closing including Lender attorney fees Provide lender's title policy Acceptable enviromnental remediation, if required All financing acceptable to Lender Lien priority acceptable to Lender Approval of final construction plans for project Survey acceptable to Lender Appraisal acceptable to Lender P & P bond or LOC or satisfactory equivalent from General Contractor Receipt of all required governmental approvals Approval of current financial statements from Guarantor Approval of final project budget Borrower counsel opinion in form and content satisfactory to Lender Monitoring: Project to be monitored at least annually for acceptable compliance with appropriate management and operation of a PSH project, and that tenants occupying the PSH units funded by Lender were chronically homeless individuals referred through the Tarrant County Continuum of Care Coordinated Entry Reports: Annual audit, copies of all reports to local, state or federal agencies, voucher providers. Any other reports identified by Lender ALL LOANS ARE SUBJECT TO APPROVAL BY THE BOARD OF DIRECTORS. FWHFC RESERVES THE RIGHT AT ANY TIME AND FROM TIME TO TIME TO CHANGE THE ABOVE LISTED LOAN TERMS AND CONDITIONS BASED ON FINANCING REQUIREMENTS, CHANGES IN CONSTRUCTION PRACTICES, APPLICABLE LEGAL OR REGULATORY CHANGES, OR BEST PRACTICES IN THE DEVELOPMENT OR OPERATION OF PSH PROJECTS.