Bernalillo County Project Revenue Bond Application Approval Bernalillo County Commission Board Meeting Date: A. Executive Summary 1. Applicant: La Vida Nueva Housing, L.P. 2. Project Location: 1200 Dickerson Dr. SE, Albuquerque, NM 3. Sponsor: Commissioner Maggie Hart Stebbins 4. PRB Description: La Vida Nueva Housing, L.P. has submitted an application for an $18,000,000 Project Revenue Bond (PRB) with an abatement term of 30 years. The PRB will be used for construction. B. Project 1. Project Description: The Chavez Foundation, through its subsidiary Bernalillo Housing Corporation II, purchased La Vida Nueva Apartments in 1998 and at that time, performed a minor rehabilitation on the site utilizing 4% tax credit and bond financing. Today, La Vida Nueva s request for tax credits has been approved by the NM Mortgage Finance Authority. The current equity limited partner, Boston Capital, has exited and the site is now eligible to re-syndicate with tax credits and bonds. The Chavez Foundation is planning to undertake another rehab to revitalize the community and contribute to the quality affordable housing supply of Albuquerque. The work will be done in phases: 12 units every three weeks over the course of 26-28 months. No permanent relocation is anticipated. La Vida Nueva will improve 20, two-story apartment buildings with 316 dwelling units. Open-surface, on-site parking for 419 vehicles is provided with 18 spaces designated for accessible use. Common area buildings are a one-story leasing office, a 600-square foot maintenance/storage building and a laundry. The site has landscaped areas with lawns and mature trees. Three playground areas and a covered patio are featured in the center of the complex. 2. Proposed Building Improvements and Land Use: Construction permits from the City of Albuquerque will be obtained as part of the development process. The site is zoned SU-1 Planned Residential Development by the City of Albuquerque Planning Department. The improvements are developed in accordance with the designated zoning.
Page 2 of 5 3. But-for-Test: But for the PRB, this project would not be feasible. Failure to approve this Resolution will result in the project not moving forward as it will only be financially feasible as a 4% tax credit and bond deal. This scenario assumes a moderate rehabilitation of approximately $26,000 per unit. Development costs total approximately $29.6M that include acquisition, rehabilitation, relocation costs, and other soft cost expenses. Sources of financing are tax credit equity, permanent loan, operating revenues, and a seller s note. La Vida Nueva s request for Volume Cap allocation from the State Board of Finance was approved at its September 20th, 2016 meeting. 4. Exemptions and Annual Issuer Fee 2015 Taxes Exempt as a non-profit low income housing organization Exemption Amount $0.00 County Exemption Amount $0.00 Annual Issuer Fee (Paid to the County) $18,000 Total Issuer Fee (Paid to the County) $540,000 C. Company Information Bernalillo Housing Corporation II ( Bernalillo ) is a New Mexico 501(c)(3) non-profit corporation established in 1998. Bernalillo was organized under the authority and as a subordinate corporation of the Cesar Chavez Foundation ( CCF ), a California 501(c)(3) non-profit corporation. Among other charitable purposes, Bernalillo was formed in order to preserve quality housing that is affordable to farm workers and very low, low, and moderate-income families in the State of New Mexico; to acquire, rehabilitate and operate real property in New Mexico; and to provide an organization through which individual families and households residing in such real property can work for the betterment of the neighborhood and community. Through its subsidiary, Bernalillo Housing LP II (the Limited Partnership ), Bernalillo has owned and operated La Vida Nueva Apartments since it purchased the site in 1998. At that time, the Limited Partnership carried out a minor rehabilitation on the site using 4% tax credits and tax exempt bonds. Since the property has reached the point where it is eligible to re-syndicate with tax credits and bonds, the Chavez Foundation is planning to undertake this rehab to revitalize the community and further contribute to quality affordable housing in Albuquerque. The Housing and Economic Development Division of the Chavez Foundation is located in Los Angeles, California. Complete contact information is as follows: Applicant: La Vida Nueva Housing, L.P. Agent: Angela Heyward Address: 316 West 2 nd Street, Suite 600, Los Angeles, CA 90012 2 P a g e
Page 3 of 5 Telephone: (213) 362-0260 ext. 231 D. Multi-Family Housing Projects 1. Approximate distances as required for bus, multiple nodes, and walkability: La Vida Nueva is 15.5-acre parcel of land located off of Yale Boulevard one-mile south of the University of New Mexico in the Near Heights Community Planning Area (CPA). The site is in an urban area that is characterized by single-family and multi-family residential use. Vehicular access to the property provided from the driveway entrances along Dickerson, Santa Clara and Katheryn Streets. Bus transit stop(s) are adjacent to the south boundary of the property along Kathryn Ave SE (Route 16), and one block west along Yale Blvd. SE (Route 50). 2. Metropolitan Redevelopment Area (MRA) designation: La Vida Nueva currently lies within the Clayton Heights MRA designation. E. Economic Impact Economic Impact: According to the City of Albuquerque s 2013-2017 Consolidated Plan, the Near Heights CPA has one of the highest poverty rates in the city and a majority of the housing stock in this CPA is over 30 years old. La Vida Nueva is a 15.5-acre parcel of land with 20, two-story apartment buildings with 316 dwelling units. As La Vida Nueva was built in the 1960s, the property now requires rehabilitation to create safe, quality affordable housing for the residents of La Vida Nueva. Additionally, this project will help revitalize the surrounding community. Not only will the rehabilitation of La Vida Nueva provide quality affordable housing and revitalize the surrounding neighborhood, we estimate the creation of 35 construction jobs during the projected 26 to 28-month construction period. This project will retain nine full-time jobs and add an additional full-time employee and a part-time employee. Existing and New Jobs Existing Jobs Job Classification Number of Positions Salary Resident Manager 1 $48,000 Assistant Manager 1 $27,685 Leasing Agent (Part Time) 1 $25,000 Maintenance Manager 1 $37,128 Maintenance 5 $24,144 New Jobs Assistant Manager 1 $25,000 Offsite Leasing Agent 1 (Part Time) $9,880 3 P a g e
Page 4 of 5 Economic Impact over the First 30 Years of the Facility's Operations: The facility is estimated to have a total Employment Multiplier of 1.7 during operations; meaning for every direct job retained by the facility, an additional.7 indirect or induced jobs will be retained within the region. Economic Impact over the First 30 Years of the Facility's Operations Total Number of Permanent Jobs to be retained and created Direct (Retained) 9 Direct (Created) 2 Indirect/Induced (Jobs retained within the Region) 12 Total 23 Employment Multiplier (During Operations) 1.7 Additional Revenues for Bernalillo County GRT $ 2,489,195 Property Tax $0 Payback Period: The payback period to recover the incentives costs contributed to the project from the additional revenues that it will receive from the facility is 22.6 years. Return on Investment: The County s average annual rate of return from additional revenues that it will receive on the investment of incentives is estimated to be 4.6% percent. F. Community Impact Community Impact: Bernalillo Housing Corporation II was formed in order to preserve housing that is affordable to farm workers and very low, low and moderate-income families in the state of New Mexico; to acquire, rehabilitate and operate real property in New Mexico; and to provide an organization through which individual families and households residing in such real property can work for the betterment of the neighborhood and community. 4 P a g e
Page 5 of 5 G. Staff Recommendation This project encourages the use of a re-development strategy that embraces sustainable, smart growth in conserving land resources by attracting new infill development. This site is already within the capacity of urban services, and has existing infrastructure in place. Promoting the development of this site more efficiently utilizes the limited resources of government and provides a viable alternative to fringe development. Further, this project continues our efforts toward achieving one of our major categories of activity to include Quality of Life initiatives by continuing to provide needed additional affordable housing for our residents. Based upon established criteria, staff recommends moving the La Vida Nueva L.P. PRB application forward and submits this application to the Commission for consideration and vote. 5 P a g e