The Housing and Community Services Agency of Lane County (HACSA) Growing and Preserving Affordable Housing HACSA Board Work Session April 6, 2016

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1 The Housing and Community Services Agency of Lane County (HACSA) Growing and Preserving Affordable Housing HACSA Board Work Session April 6, 2016

2 HACSA s Strategic Vision Increase the number of special needs populations (i.e. chronically homeless) with the existing housing assets, existing programs and new units Preserve HACSA s existing housing assets and subsidies Develop new affordable housing units and secure a new administrative building Increase the number of residents/participants graduation out of HACSA s federal programs by achieving self-sufficiency Work in partnership with local jurisdictions, businesses and non profits to expand awareness and funding for the affordable housing needs in our community Develop and grow HACSA s impact in the community by providing our employees with education, training, advancement opportunities in a modern, innovative workplace Decrease HACSA s reliance on federal funding

3 DAMCAP Team Organization Chart

4 Asset Management and Preservation

5 Affordable Housing Portfolio Overview 1533 units on 31 sites throughout Lane County 707 Public Housing units Construction between , no major rehabilitation 519 Mixed Funding Construction , 4 sites have undergone rehabilitation 157 PBS8 Assisted Housing units Construction , some rehabilitation 150 Other units with varying funding and subsidy sources Construction s HACSA has partnerships with over 30 community organizations to provide services to residents living in our properties.

6 Evolution of Asset Management at HACSA Revamping the asset management strategy, reinforcing the asset management team Developing monitoring tools to measure asset performance both in long and short term Continuously assessing the physical and financial condition of HACSA s portfolio

7 HACSA Preservation Plan Evolution of asset management Fixing troubled and underperforming assets Enhancing asset performance through rehabilitation and refinancing Providing better service for our populations Enhancing green performance and efficiency GPNAs and CPNAs RAD 1.0 RAD 2.0

8 Preservation Planning Assess Operations, Financial performance, Physical condition, Mission Implement Prioritize Undertake actions for improvement in identified areas; management, refinance, resyndication, major rehab, disposition Synthesize information gained from assessments to develop a preservation plan

9 Preservation Planning Assessments Operating Costs 48% of HACSA s 1534 affordable housing units are at least 30 years old Unit age directly effects operating costs

10 Preservation Planning: Assessment - Capital Needs vs. Capital Reserves

11 Preservation Planning Priority Criteria Implement Assess Prioritize Operations Financials Physical Condition Management Income vs. expenses ratio Debt Coverage Ratio(DCR) Age since rehabilitation Occupancy Rent restrictions Capital Repair Needs vs. Capital Reserves Resident services delivery (mission) Milestones/Cliffs (LIHTC year 15, OAHTC) Reliance on Federal Funding Function (energy efficiencies, amenities)

12 Preservation Planning: Implementation Implement Assess Prioritize Operations Actions Financial Actions Physical Actions Property Management Division Director Dedicated Asset Manager Change in 3rd party Property Management Vacancy trending reporting Enhanced Resident Services Development and implementation of new Operating Report processes Financial standards established and reviewed monthly Project database, document library, and financial dashboard with trending, created for each owned development. RAD Public Housing Scattered Sites Sheldon Village Richardson Bridge Willakenzie Townhomes Laurel Gardens Energy Services

13 Development Pipeline and the Rental Assistance Demonstration Program (RAD)

14 Public Housing Preservation Rental Assistance Demonstration Program (RAD) The Rental Assistance Demonstration was created in order to give public housing authorities (PHAs) a powerful tool to preserve and improve public housing properties and address the $26 billion dollar nationwide backlog of deferred maintenance. RAD allows public housing agencies to leverage public and private debt and equity in order to reinvest in the public housing stock. Energy Performance Contracting

15 HACSA - RAD 1.0 Obtained approval to sell 112 inefficient 2, 3 and 4 bedroom scattered site public housing units Convert Public Housing rent subsidy into Section 8 rental subsidy and attach these subsidies to 112 units of similar bedroom size. Full relocation for current residents and right to return to new/rehabilitated units

16 HACSA - RAD 1.0 Home-ownership opportunities for existing residents Relocation specialist provides resident options 10 units into Richardson Bridge 9% tax credit option (no finance gap) 4% backup plan ($ million estimated finance gap) Remaining 102 replacement units as new construction in the Eugene-Springfield Metro area Existing or new HACSA properties / Land-bank sites

17 HACSA - RAD 1.0 Home-ownership opportunities for existing residents Partnership with NEDCO HACSA Family Self Sufficiency Program outreach NEDCO outreach through homeownership program IDAs and down payment assistance as tools for purchasing

18 HACSA RAD 2.0 Conversion of remaining public housing portfolio HACSA conducting due diligence Aging portfolio with not enough funds to make needed capital repairs ($6.4m of capital projects needed immediately and another $8.3m needed in years 1-5) If approved would allow conversion of rest of 595 units of Public Housing Portfolio to private financing options Keep affordable units in community and allows rehabilitation Unlike scattered sites converts existing project to rental assistance instead of public subsidy

19 Development & Preservation Pipeline Bascom Village Phase II The Oaks at 14 th Hope Loop Glenwood Place 6 th & Oak Richardson Bridge Rehab Sheldon Village Rehab RAD Replacement Project(s) Land bank or HACSA purchased site(s) Administrative Building

20 Disposition Possibilities 48 th and Main St, Springfield 8.5 acres, zoned High Density River Road 3.5 acres, zoned Medium Density Residential with Site Review overlay zone HACSA office, 177 Day Island Rd new or rehabbed more efficient building, in a location close to better access to public transport to better serve the population

21 Acquisition New site(s) for RAD replacement housing Identify short list with Real Estate Agent Ideally located for grocery, transit and school access Building for rehabilitation to serve as new HACSA HQ or site for a new constructed HQ Location focused on better servicing our clients, one location and good transit connection Collaboration with the jurisdictions on opportunity areas

22 RICHARDSON BRIDGE REHAB SHELDON VILLAGE I AND II REHAB Financing Options

23 Richardson Bridge Rehab Recommended structure: 9% LIHTC, with modest permanent loan Team: PIVOT Architecture and Meili Construction Financing Program MULTI-FAMILY FINANCIAL REPOSITIONING ANALYSIS SUMMARY Richardson Bridge Apartments Development Revenue Sources 9% LIHTC with substantial renovation 4% LIHTC with substantial renovation No LIHTC with substantial renovation Tax Credit Equity $4,050,000 $2,275,000 $0 Permanent Loan $350,000 $350,000 $350,000 Seller Financing $2,275,000 $2,275,000 $0 Sponsor Subordinate Financing $0 $0 $0 Soft Funding $0 $0 $0 Deferred Developer Fee $360,000 $205,000 Gap Financing $0 $2,135,000 $3,275,000 $7,035,000 $7,240,000 $3,625,000

24 Sheldon Village I&II Rehab Structure: 4%LIHTC Team: To be determined through a procurement process MULTI-FAMILY REHAB FINANCIAL SUMMARY Sheldon Village I&II and Willakenzie Townhouses Financing Program Development Revenue Sources 4% LIHTC with substantial renovation Tax Credit Equity $4,156,110 Private Placement Long-Term Bonds $4,500,000 Seller Financing (From Land & Bldg Sale) $4,485,690 Wz Grant $100,000 Project Reserves $410,000 Gap Financing $886,025 $14,537,825

25 Support Needed from the HACSA Board? Authorize disposition when appropriate Authorize acquisition when appropriate Support Richardson Bridge as #1 priority for Lane County for the 9% LIHTC