CORPORATION Minutes of Special Meeting August 20, 2020

PARTICIPANTS

UHC Trustees via Teleconference: UHC Staff via Teleconference: Lerron Little, Chair Grant Whitaker, President and CEO G. Edward Leary, Trustee Cleon Butterfield, Senior Vice President and CFO Jonathan Hardy, Trustee-Designee Jonathan Hanks, Senior Vice President and COO Patricia Sheffield, Trustee Claudia O’Grady, VP Multifamily Finance Jessica Norie, Trustee Susan Larsen, Executive Assistant

Guests via Teleconference: Preston Olsen, Gilmore & Bell, P.C. Robert Vernon, Provo City Housing Authority Pam Liston, Provo City Housing Authority Steven Graham, Canterbury Partners Bill Knowlton, Canterbury Partners Adam Horton, Trinity Housing Development Chadrick Martinez, Trinity Housing Development Jeremy Shinoda

Trustees of the Utah Housing Corporation (UHC or Utah Housing) and UHC staff met in a Special Meeting on Thursday, August 20, 2020, at 3:00 PM MDT via teleconference and at the offices of Utah Housing Corporation located at 2479 South Lake Park Blvd., West Valley City, Utah. In accordance with the Utah Open and Public Meetings Act, the meeting was an electronic meeting and the anchor location was the office of Utah Housing Corporation.

Lerron Little, UHC Board Chair, called the meeting to order. The Chair then determined for the record that a quorum of Trustees was present, as follows: Lerron Little, Chair G. Edward Leary, Trustee Jonathan Hardy, Trustee-Designee Patricia Sheffield, Trustee Jessica Norie, Trustee

The Chair excused the following Trustee(s): Brett Mills, Vice Chair David Damschen, Trustee Lee A Carter, Trustee Annette Lowder, Trustee

The Chair welcomed everyone to the meeting. The Chair then introduced the President and CEO, Grant Whitaker, and announced that he would be taking the Trustees through the Board packet.

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Grant S. Whitaker, President of Utah Housing, then reported that the Notice of the Special Meeting was given to all Trustees of Utah Housing and that material addressing the agenda items had been distributed to the Trustees in advance of the meeting.

Mr. Whitaker then acknowledged a Verification of Giving Notice, evidencing the giving of not less than 24 hours public notice of the date, time, place and summary of agenda of the Utah Housing Corporation Special Meeting in compliance with the requirements of the Utah Open and Public Meetings Act, Section 52-4-202(2)(a)(b), Utah Code Annotated 1953, as amended; together with the form of Notice of Special Meeting referred to therein; and also the required public notice of the 2020 Annual Meeting Schedule of Utah Housing will be entered into the Minutes.

The Chair called for the first agenda item.

1. Approval of the Minutes of July 30, 2020 Regular Meeting

The Trustees had been provided with a copy of the written minutes of the July 30, 2020 Regular Meeting in their Board packets. The Trustees acknowledged they had sufficient time to review these minutes. Mr. Little asked for any discussion on the July 30, 2020, minutes as presented.

Following any further discussion, the Chair called for a motion.

MOTION: TO APPROVE THE WRITTEN MINUTES OF THE REGULAR MEETING OF JULY 30, 2020.

Made by: Patricia Sheffield Seconded by: G. Edward Leary

The Chair called for the next agenda item.

1. Disclosure of Trustees’ Interests

Mr. Little stated that the consolidated list of the disclosures of interests on file for each Trustee is contained in the board packet, and subject to any changes, will be attached to the minutes of this meeting. Each Trustee will be asked to respond if your disclosure of interests on file with Utah Housing is current.

Mrs. Larsen asked each Trustee to respond by saying yes if the Disclosure of Interest on file is current. Each Trustee was called on and they responded as follows:

G. Edward Leary Yes Jonathan Hardy Yes Patricia Sheffield Yes Jessica Mills Yes Lerron Little Yes

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The following is a consolidated list of the Disclosures of Interests on file for each Utah Housing Trustee:

Name of Trustee Nature of Interest or Potential Interest Lerron E. Little Presently serving as an Associate Broker with Sotheby’s International (chair) Realty. Sotheby’s International Realty is doing business as a real estate brokerage in the State of Utah. Sotheby’s International Realty may be involved in real estate transactions that use mortgage loans under the Corporation's programs, and may serve as a marketing agent for various properties owned by the Corporation. Brett Mills Presently serving as a Regional Sales Leader and Senior Loan Officer for (vice chair) Academy Mortgage Corporation in the State of Utah. Academy Mortgage Corporation may originate mortgage loans for sale to the Corporation under the Corporation's program. Patricia Sheffield Presently retired from any employment and has no interests in any transactions with the Corporation.

Lee A Carter Presently serving as the Head of Banking Development of Rakuten. Rakuten has filed an application with The Utah Department of Financial Institutions for an industrial bank charter. If the charter is granted to Rakuten Bank America (in formation), upon commencement of operations of the bank, the bank may participate in the investment of tax credits and may be owner of bonds issued by the Corporation. The bank may also provide the Corporation with other financial instruments and enter into agreements that benefit the Corporation and the bank. Annette Lowder Presently serving as Chief Operations Officer (COO) of Intercap Lending, Inc., a mortgage lender doing business in the state of Utah. Intercap Lending may originate mortgage loans for sale to the Corporation under its programs. Jessica Norie Presently serving as President of Artspace, a nonprofit which creates affordable live and work space to revitalize and promote stable, vibrant and safe communities. Artspace may be involved in the use of low income housing tax credits and tax exempt bond financing for , and may manage housing or develop housing under the Corporation's programs. David Damschen Presently serving as the Treasurer for the State of Utah and has no (ex-officio) interests in any transactions with the Corporation.

G. Edward Leary Presently serving as the Commissioner of Financial Institutions for the (ex-officio) State of Utah and has no interests in any transactions with the Corporation.

Jonathan Hardy Presently serving as the Division Director of The Housing and Community (ex-officio) Development Division of the Department of Workforce Services for the State of Utah as well as the administrator of the Olene Walker Housing Loan Fund and the National Housing Trust Fund. Monies from each of these funds may be used in financing of rental housing developed with Low-Income Housing Tax Credits.

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The Chair called for the next agenda item.

1. Resolution 2020-17 authorizing a Tax-exempt Mortgage Loan in an Aggregate Principal Amount not to exceed $4,650,000 for 85 North - Phase 2, Provo, Utah

A RESOLUTION OF UTAH HOUSING CORPORATION (“UHC”) AUTHORIZING A TAX-EXEMPT MORTGAGE LOAN IN AN AMOUNT NOT TO EXCEED $4,650,000 AND THE ISSUANCE AND DELIVERY BY UHC OF ITS MULTIFAMILY HOUSING REVENUE NOTE (85 NORTH APARTMENTS – PHASE 2) SERIES 2020 IN ONE OR MORE SERIES IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $4,650,000 TO FINANCE THE ACQUISITION, CONSTRUCTION AND EQUIPPING OF A MULTIFAMILY RENTAL HOUSING DEVELOPMENT; AUTHORIZING THE EXECUTION BY UHC OF A FUNDING LOAN AGREEMENT, A BORROWER LOAN AGREEMENT, A TAX REGULATORY AGREEMENT AND OTHER DOCUMENTS REQUIRED IN CONNECTION THEREWITH; AND AUTHORIZING THE TAKING OF ALL OTHER ACTIONS NECESSARY TO THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED BY THIS RESOLUTION; AND RELATED MATTERS.

Mr. Whitaker introduced Resolution 2020-17. The following items were included in the discussion:

• Resolution 2020-17 authorizes the making of a tax-exempt mortgage loan to finance the development of the 85 North Apartments Phase 2 in Provo, Utah. • The developer is Provo City Housing Authority in partnership with Trinity Housing Development. Provo Housing Authority is an experienced developer of affordable housing. They have developed other low-income multifamily projects including St. Francis Apartments, Maeser School Apartments, Canyon View Apartments, and Maple View Apartments. The Housing Authority will own the project along with the tax credit partner Red Stone Equity Partners. • The Project is the second phase of a larger development. This phase will consist of 30 one-bedroom/one-bathroom units. All units will target renter households at or below 60% of area median income levels. It is located at approximately 85 North 100 East in Provo, Utah County. • Instead of issuing tax-exempt bonds for the debt, Utah Housing takes out a tax-exempt loan (Funding Loan) from M1 Bank. • Utah Housing then makes a tax-exempt Loan to the project with matching economic terms (Borrower Loan), which loan will provide financing for the project. • The Borrower Loan is delivered to M1 Bank providing the revenue and security of the Funding Loan. • The Funding Loan and Borrower Loan will have matching economic terms, including a not-to-exceed term of 42 years with a mandatory redemption at completion of construction. • Private Activity Bonds in the amount of $4,200,000 were allocated to the project by the Private Activity Bond Board in April 2020.

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• The resolution authorizes the transaction in an amount up to $4,650,000, rounding up the PAB allocation by about 10%, in case the financing is modified to a larger amount, so that we do not need to return to the Board for an amendment. • A Public Hearing will be held before the loans close. • A reservation of 4% and State Low Income Housing Tax Credits will be considered by the Board in another resolution addressed today. • The Tax Credit investor is Redstone Equity Partners. • Gilmore Bell is serving as bond counsel and U.S. Bank National Association is the fiscal agent. • Just like a conduit bond issue, Utah Housing takes no risk on the mortgage loans, which is clearly spelled out in the documents.

Mr. Whitaker stated approving the resolution will enable Utah Housing to serve its mission to serve lower income renters and he recommended approval of Resolution 2020-17.

Mr. Little then asked if there were any additional comments or discussion from the Board, and following any additional discussion asked for a motion to adopt the resolution.

Motion: APPROVE RESOLUTION 2020-17 AUTHORIZING A TAX-EXEMPT MORTGAGE LOAN IN AN AGGREGATE PRINCIPAL AMOUNT NOT OT EXCEED $4,650,000 FOR 85 NORTH APARTMENTS – PHASE 2, PROVO, UTAH

Made by: Jonathan Hardy Seconded by: Patricia Sheffield

Mr. Little called for a vote on the motion:

Voted in Favor of the Voted Against the Abstained From Motion: Motion: Voting: G. Edward Leary Jonathan Hardy Patricia Sheffield Jessica Norie Lerron Little

The Chair called for the next agenda item.

2. Resolution 2020-18 authorizing the issuance of Tax-exempt Bonds in an Aggregate Principal Amount not to exceed $3,300,000 for Senior Living on Washington - Phase 2, Ogden, Utah

A RESOLUTION OF UTAH HOUSING CORPORATION (“UHC”) AUTHORIZING THE ISSUANCE AND SALE BY UHC OF ITS

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MULTIFAMILY HOUSING REVENUE BONDS (SENIOR LIVING ON WASHINGTON - PHASE 2) SERIES 2020 IN ONE OR MORE SERIES IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $3,300,000 TO FINANCE THE ACQUISITION, CONSTRUCTION AND EQUIPPING OF A MULTIFAMILY RENTAL HOUSING DEVELOPMENT; AUTHORIZING THE EXECUTION BY UHC OF A TRUST INDENTURE, A LOAN AGREEMENT, A TAX REGULATORY AGREEMENT AND OTHER DOCUMENTS REQUIRED IN CONNECTION THEREWITH; AND AUTHORIZING THE TAKING OF ALL OTHER ACTIONS NECESSARY TO THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED BY THIS RESOLUTION; AND RELATED MATTERS.

Mr. Whitaker introduced Resolution 2020-18. The following items were included in the discussion:

• Resolution 2020-18 approves the issuance of Tax-Exempt Mortgage Revenue Bonds in an amount up to a $3,300,000 for the Senior Living on Washington Phase 2 project in Ogden. • The bonds will finance the acquisition and construction loans made by JPMorgan Chase Bank. • The bonds will bear a variable interest rate and will mature on or before January 1, 2025, presumably taken out by a bank loan. • Despite the short term, the tax-exempt nature of Utah Housing’s financing makes the project eligible to be considered for federal and state housing credits. • As a typical “conduit” bond issue, Utah Housing has no risk in this transaction if the project stumbles. • None of the debt instruments are general obligations of Utah Housing. • The owners of the bonds will look to the project revenues, any reserves and the collateral of the project for repayment. • The project received an allocation of Private Activity Bonds in April, 2020. • The Senior Living on Washington is a 27-unit project at 2965 S. Washington Blvd. in Ogden, Weber County, and it is the second phase of a larger development. The Project will serve residents over the age of 55 years with incomes at 60% of the area median income or lower. • This is the first financing Utah Housing has done for this developer, Canterbury Partners, but its experienced principals have developed several successful affordable projects throughout Utah with Utah Housing debt and equity financing including Brigham Place Apartments, Pacific Drive Apartments, and Artesian Springs I, II, and III. • SLoW Blvd 2 LLC, a subsidiary of SLoW Management, LLC, will own the project along with the tax credit partner The Richman Group. The contractor is Centerpoint Construction. Gilmore Bell serves as bond counsel. The trustee is U.S. Bank National Association. • The resolution authorizes the transaction in an amount up to $3,300,000, rounding up the PAB allocation by about 10%, in case the financing is modified to a larger amount, so that we do not need to return to the Board for an amendment. • A Public Hearing will be held before the bonds close. 6

• A reservation of 4% and State Low Income Housing Tax Credits will be considered by the Board in another resolution addressed today.

Mr. Whitaker stated approving the resolution will enable Utah Housing to fulfill its mission to serve lower income renters and he recommended approval of Resolution 2020-18.

Mr. Little then asked if there were any additional comments or discussion from the Board, and following any additional discussion asked for a motion to adopt the resolution.

Motion: APPROVE RESOLUTION 2020-18 AUTHORIZING THE ISSUANCE OF TAX-EXEMPT BONDS IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $3,300,000 FOR SENIOR LIVING ON WASHINGTON - PHASE 2, OGDEN, UTAH Made by: G. Edward Leary Seconded by: Patricia Sheffield

Mr. Little called for a vote on the motion:

Voted in Favor of the Voted Against the Abstained From Motion: Motion: Voting: G. Edward Leary Jonathan Hardy Patricia Sheffield Jessica Mills Lerron Little

The Chair called for the next agenda item.

3. Resolution 2020-19 Reservation of Federal and State Housing Tax Credits

A RESOLUTION OF THE UTAH HOUSING CORPORATION RESERVING FEDERAL AND STATE HOUSING TAX CREDITS Mr. Whitaker introduced Resolution 2020-19. The following items were included in the discussion:

• Utah Housing is the designated allocator of Federal and State Housing Credits. • The detail of today’s reservation of Credits is found on Exhibit A to Resolution 2020-19. • The resolution approves the reservation of both 4% Federal Credits and State Credits. • The resolution approves a reservation of $280,976 Federal 4% Low Income Housing Tax Credits for the 85 North Apartments Phase 2, in Provo and $190,425 for the Senior Living on Washington Phase 2, in Ogden.

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• The 4% Federal Credits are available only to projects that fund at least 50% of eligible costs with tax-exempt bonds or tax-exempt loans. • These projects received allocations of tax-exempt Private Activity Bonds from the Private Activity Bond Board in April, 2020. • Utah Housing approved resolutions authorizing the issuance of bonds for each of these projects under separate agenda items during this meeting. • There is no specific limit of 4% Federal Credits and there is no competition for them as there is for 9% Credits. • We often refer to them as non-competitive because they are not awarded from the limited pool of 9% Credits available to Utah each year for which Utah Housing takes applications and awards Credits to highest scoring projects. • The limited amount of 9% Competitive Credits were allocated at the December 2019 Utah Housing Board meeting following a round of competitive applications that were submitted last October. • The limitation on the amount of 4% Credits comes as a result of the limited amount of Private Activity Bond (Cap) available to multifamily rental projects. • Resolution 2020-19 also reserves $221,211 State Credits for the 85 North Apartments Phase 2 in Provo to reduce rents and fill a gap in its funding and $190,425 State Credits for the Senior Living on Washington in Ogden Phase 2 Apartments to reduce rents and fill a gap in funding. • The recommended amount of State Credits is reduced for each project from the applicants’ requested amounts to the lesser of 20% of the annual State Credit ceiling amount available to Utah Housing to award or the amount of Federal Credits reserved to the project. • The very limited amount of State Credits, equal to about 1/9th of the Federal Credits, are only available to projects that are awarded Federal Credits. Just as we limit the amount any project may receive in federal credit, it is appropriate to limit the amount of the state credit as well. It is in the best interests of the program to spread limited resources to multiple projects and multiple communities because of the extraordinary needs for affordable housing throughout the state. • Even at the proposed reduction levels, the 4 phases of these 2 projects will have been awarded over 63% of the annual state housing credit ceiling.

Mr. Whitaker stated approving the resolution will enable Utah Housing to serve its mission to serve lower income renters and he recommended approval of Resolution 2020- 19.

Mr. Little asked Mr. Graham if he would like any time to comment. Mr. Graham stated his surprise at the limitation as it still will result in a gap for funding and would have appreciated notice prior to the board meeting.

Mr. Whitaker explained that traditionally all credit approvals and amounts are shared during the board meetings and not prior to. Mr. Graham acknowledged that was true. Mr. Whitaker also noted that there are two pools of state credits, one for gap funding and the other for reduction of the tenant Area Median Income (AMI) percentage to 30% or lower. Developers are invited to submit applications for gap funding at a cash equivalent of up to $500,000, which is what each application submitted and were approved for. The pool 8

for which the reductions took place was for the lowering of AMIs. The developments should be able to reduce the number of units serving 30% AMI and still pencil out.. Mr. Graham stated his understanding and thanked the Utah Housing Staff for their work.

Mr. Little shared the issues that are facing all of the developers of affordable housing and Utah Housing providing the funding needed to be fair to all developers.

Mr. Vernon stated his appreciation to the Board and Mr. Whitaker for holding the special meeting.

Mr. Little then asked if there were any additional comments or discussion from the Board, and following any additional discussion asked for a motion to adopt the resolution.

Motion: APPROVE RESOLUTION 2020-19 RESERVATION OF FEDERAL AND STATE HOUSING TAX CREDITS Made by: Patricia Sheffield Seconded by: Jonathan Hardy

Mr. Little called for a vote on the motion:

Voted in Favor of the Voted Against the Abstained From Motion: Motion: Voting: G. Edward Leary Jonathan Hardy Patricia Sheffield Jessica Norie Lerron Little

The Chair called for the next agenda item.

3. Non-Action Items • The Annual NCSHA Conference has been rescheduled for October 27-29, 2020 and will be a virtual conference. The Board will be notified with more details as soon as they are available. The conference falls on the date of the regularly scheduled October Board Meeting, so we may wish to assemble either before or after the conference time to conduct a meeting. More will follow.

The Chair announced that the meeting was adjourned with a motion from G. Edward Leary.

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