REGULAR MEETING OF THE MISSOURI HOUSING DEVELOPMENT COMMISSION TUESDAY, J UNE 22, 2021 AT 10:00 A.M.
Notice is hereby given that the Missouri Housing Development Commission will conduct its Regular Meeting on Tuesday, June 22, 2021 at the
Capitol Plaza Hotel Jefferson City Jefferson and Missouri Meeting Rooms 415 W. McCarty Street Jefferson City, MO 65101
The agenda of this meeting is attached to this notice.
The news media may obtain copies of this notice by contacting:
Lynn Sigler Missouri Housing Development Commission 920 Main Street, Suite 1400 Kansas City, MO 64105 (816)759-6822 [email protected]
MHDC will make reasonable accommodations for persons with disabilities at the public site. To request an accommodation, please contact Lynn Sigler at (816) 759-6822 or [email protected].
REGULAR MEETING OF THE MISSOURI HOUSING DEVELOPMENT COMMISSION TUESDAY, JUNE 22, 2021 AT 10:00 A.M.
AGENDA CAPITOL PLAZA HOTEL JEFFERSON CITY JEFFERSON AND MISSOURI MEETING ROOMS 415 W. MCCARTY STREET JEFFERSON CITY, MO 65101
Regular Meeting
1. Roll Call
2. Approval of Minutes for the April 29, 2021 Regular Meeting
3. Report of Chairman
4. Report of Staff a. SAFHR Update b. Presentation of Executive Summary of Strategic Financial Plan c. FY22 Budget d. Single Family Mortgage Revenue Bonds – Resolution No. 1065 e. Mortgage Credit Certificate (MCC) – Resolution No. 1066 f. AHAP Production Applications g. ESG NOFA and Allocation Plan h. 4% TE Bond Second Round Recommended Applications i. Five Year Strategic Plan Update j. Resolution No. 877 k. Affordable Housing Development Cost Increase
5. Such other matters that may come before the Commission
1) Roll Call
Missouri Housing Development Commission
Roster
Governor:
Mike Parson Governor
Commissioner: Lieutenant Governor and Chairman: Garrick Hamilton Mike Kehoe Lieutenant Governor Commissioner:
Treasurer: Danny P. Chadakhtzian
Scott Fitzpatrick State Treasurer Commissioner:
Stephen J. Parshall Attorney General:
Eric Schmitt Attorney General
Vice Chairman:
Tracey S.C. Lewis
Secretary/Treasurer:
Mark Elliff
Commissioner:
Rick McDowell
Page 1 of 1 Rev. 1.28.21 2) Approval of Minutes for the April 29, 2021 Regular Meeting
MISSOURI HOUSING DEVELOPMENT COMMISSION Regular Meeting Minutes of Meeting Held Thursday, April 29, 2021
The Regular Meeting of the Missouri Housing Development Commission was held virtually on Thursday, April 29, 2021 at 10:00 a.m.
Those present were: Commissioners and Persons Present to Vote for Mike Kehoe, Lieutenant Governor and Ex-Officio Members Chairman Scott Fitzpatrick, State Treasurer Justin Smith, on behalf of Attorney General Schmitt Tracey Lewis, Vice Chairman Mark Elliff, Secretary-Treasurer Rick McDowell, Commissioner Garrick Hamilton, Commissioner Danny Chadakhtzian, Commissioner Stephen Parshall, Commissioner Others Present Kayla Hahn, Governor Parson’s Office Leslie Korte, State Treasurer Fitzpatrick’s Office Commissioners Absent Mike Parson, Governor Eric Schmitt, Attorney General Staff Members Kip Stetzler, Executive Director Tina Beer, Director of Operations Marilyn Lappin, Director of Finance Frank Quagraine, Director of Rental Production Katie Jeter-Boldt, General Counsel Jennifer Schmidt, Deputy Director of Operations Scott Hanak, Director of Asset Management David Nickum, Director of Information Technology Sara Turk, Fiscal and Accounting Manager Gus Metz, Chief Underwriter Steve Whitson, Community Initiatives Manager Jenni Miller, Manager of HUD Programs Lynn Sigler, Operations Manager Margaret Murphy, Housing Policy Analyst Megan Word, Legislative Coordinator
Chairman Lieutenant Governor Kehoe called the meeting to order. Commission meeting roll call was taken by Ms. Sigler; a quorum was present.
A motion to approve the Minutes of the Regular Meeting held on March 31, 2021 was made by Commissioner Hamilton and seconded by Secretary-Treasurer Elliff. The motion passed unanimously with a vote of 9-0.
Staff presented an update on the State Assistance for Housing Relief (SAFHR) Program. No vote was taken.
A motion to approve the 2021 Affordable Housing Assistance Program Production Credit Applications recommended by staff was made by Chairman Lieutenant Governor Kehoe and seconded by Commissioner Hamilton. The motion passed unanimously with a vote of 9-0.
A motion to approve the selection of bond underwriters and selling group members as recommended by staff was made by Chairman Lieutenant Governor Kehoe and seconded by Secretary-Treasurer Elliff. The motion passed with a vote of 7 ayes. Commissioners Hamilton and Parshall abstained.
A motion to approve funding for federal 4% LIHTC rolling applications as recommended by staff was made by Chairman Lieutenant Governor Kehoe and seconded by Vice Chairman Lewis. The motion passed unanimously with a vote of 9-0.
A motion to approve extending the Master Servicer Agreement for homeownership programs as recommended by staff was made by Commissioner Hamilton and seconded by State Treasurer Fitzpatrick. The motion passed with a vote of 9-0.
Chairman Lieutenant Governor Kehoe inquired if there were any other matters for the Commission to take up, and upon hearing none, State Treasurer Fitzpatrick made a motion to adjourn. The motion was seconded by Commissioner McDowell and passed unanimously with a vote of ayes.
______Lieutenant Governor Mike Kehoe, Chairman 3) Report of Chairman
4) Report of Staff a. State Assistance for Housing Relief (SAFHR) Update
4) Report of Staff b. Presentation of Executive Summary of Strategic Financial Plan
June 22, 2021
TO: Commissioners Missouri Housing Development Commission
FROM: Marilyn Lappin Mike Parson Director of Finance Governor Mike Kehoe SUBJECT: Strategic Financial Plan Lieutenant Governor Chairman
Scott Fitzpatrick MHDC’s financial advisors, CSG Advisors and Columbia Capital Management, prepare State Treasurer the Commission’s Strategic Financial Plan. The information contained in the Strategic Eric Schmitt Financial Plan is an important tool used in successful planning for fiscal year 2022 and Attorney General beyond. Tracey S.C. Lewis Vice Chairman The Strategic Plans provides information about MHDC’s financial resources including Mark Elliff the assets and liabilities of the mortgage revenue bond programs and the assets, including Secretary-Treasurer commitments, of the operating fund. The strategic plan illustrates how MHDC is faring Rick McDowell in the current economy and projects financial results over five years. Varying scenarios Commissioner are evaluated to provide information about future impacts that would result in an expected Garrick Hamilton ‘base case’ of activity and alternative scenarios related to changes in single family Commissioner funding sources, interest rates and production levels. The plan outlines the assumptions Danny P. Chadakhtzian used for these scenarios and compares expected results. Commissioner Stephen J. Parshall The attached Synopsis provides an overview of the Strategic Financial Plan and Commissioner projections. MHDC continues to be a strong financial agency, well positioned in the
current economy. MHDC’s conservative asset base and careful management of resources furthers MHDC’s financial strength to sustain MHDC’s service to Missouri citizens
through financing of home mortgages and multifamily housing loans, along with the Kip Stetzler Executive Director administration of federal and other housing programs.
Kansas City 920 Main, Suite 1400 Kansas City, MO 64105 816-759-6600 Fax 816-301-7000
St. Louis 505 N. 7th Street 20th Floor, Suite 2000 St. Louis, MO 63101 www.mhdc.com
Missouri Housing Development Commission Strategic Plan Synopsis (2021-2025)
Each year the Commission prepares a strategic plan with a five-year outlook to review its financial position, analyze the impact of its ongoing and proposed programs, and assess its long-term operating sustainability. This year’s plan includes use of MHDC resources to provide housing support during the COVID-19 pandemic.
Current Financial Position. For several years Base Case Projections. Base case projections the Commission experienced a declining asset base use conservative estimates for future activities and due to high levels of loan prepayments. This trend serve as a starting point for discussing and reversed in 2016, and since then the Commission’s projecting the Commission’s financial strength in asset base has grown modestly. The key measure of the years ahead.2 Under the base case, the the Commission’s financial strength and health is Commission’s key measure of financial strength its fund balance, which ended FY 2020 at an all- and health (fund balance) grows through 2025. time high of $546 million. The fund balance has Funding a portion of the Commission’s loans with grown gradually and consistently through the years. bonds adds to the asset base, and operating liquidity is expected to remain at a healthy level. § In FY 2019 and FY 2020, total assets grew by 1.5% and 8.4%, respectively. Single Family Multi-Family Operating Fund $2,500 § Assets grew as loan production funded with Assets bonds exceeded prepayments on existing loans. $2,000 Liabilities § Over time, warehouse line earnings and $1,500 economic refundings have increased return on assets and return on equity. Investment income $1,000 increased through most of 2020 due to a rise in Fund Balance short-term interest rates. $500
Financial Metrics 2017-19 2020 $0 Asset Growth 3.0% 8.4% 1 2020 2022 2025 2020 2022 2025 2020 2022 2025 Operating Fund Liquidity 13.6% 13.1% Return on Equity 2.7% 3.0% Return on Assets 1.0% 1.0% Base Case Scenario (FY 2021-25) ($MM) Single Family Loans 1,510 1The Commission continues to maintain stable and healthy levels of liquidity. Mortgage Backed Securities Sales 220 Bal. Sheet ($MM) SF MF OF Total Bond Financed Loans 1,290 Assets 1,108.3 131.0 487.5 1,726.8 Loan Prepayment Range (annually) 12-15% Liabilities 983.9 112.9 84.3 1,181.1 2 Fund Balance 124.4 18.1 403.2 545.7 Given the uncertainty regarding pandemic-induced economic disruption, forecasts are difficult to predict and are subject to a higher degree of uncertainty than usual. Alternative Case Projections. The Commission’s staff and advisors make projections with alternative economic assumptions to test the Commission’s financial strength under various market conditions. These projections indicate the Commission is well positioned to support scenarios with both higher and lower than expected loan production, and rising or stagnant interest rates.3 The Commission’s fund balance is projected to grow in each of the alternative scenarios tested.
MHDC Credit Rating Strengths. The Commission is rated AA+ by S&P Global Ratings. The Commission’s credit strengths include an experienced management team, a strong, diverse state economy, and a high-quality, low risk asset base with strong fund balances. Most of the Commission’s bonds are backed by mortgage securities issued by GNMA, FNMA or FHLMC, and the Commission has no exposure to variable rate debt. The Commission’s investable assets are held primarily in U.S. government agency Metric Description MHDC (2015-19) AA+ HFAs All HFAs securities and highly rated money market Average Return on Assets 1.0% 1.0% 1.2% Loss Reserves/Loans 3.3% 5.7% 4.8% funds. The table to the right compares Non-Perform/Loans 0.3% 2.8% 3.0% certain financial metrics of the Commission Total Equity/Assets 40.3% 35.5% 28.3% to other housing finance agencies. Total Loans/Assets 72.0% 66.3% 65.4%
3 Despite the potential for lower interest earnings or the potential impact of multi-family loan forbearances, MHDC is well positioned to remain resilient during the pandemic. 4) Report of Staff c. FY22 Budget
June 22, 2021
Mike Parson TO: Commissioners Governor Mike Kehoe FROM: Marilyn Lappin, Director of Finance Lieutenant Governor Sara Turk, Controller Chairman Scott Fitzpatrick SUBJECT: Budget for the Year Ending June 30, 2022 State Treasurer Eric Schmitt Attorney General The proposed budget for Fiscal Year 2022 for the period July 1, 2021 through June 30, Tracey S.C. Lewis 2022 is attached for consideration. The Executive Summary included provides an Vice Chairman overview of significant observations. Mark Elliff Secretary-Treasurer The proposed Fiscal Year 2022 budget includes total revenues of 859.9 million, expenses Rick McDowell at $840.4 million and subsidy programs at $2.9 million. The budgeted activity includes Commissioner federal assistance revenues of $789.8 million and expenses of $784.8 million. Garrick Hamilton Commissioner Danny P. Chadakhtzian Recommendation: Commissioner Stephen J. Parshall Staff requests approval of the Fiscal Year 2022 budget, with the budgeted Commissioner expenditure levels for Fiscal Year 2022 to continue beyond Fiscal Year 2022 for purposes of conducting ongoing operations until a subsequent fiscal budget is adopted.
Kip Stetzler Executive Director
Kansas City 920 Main, Suite 1400 Kansas City, MO 64105 816-759-6600 Fax 816-301-7000
St. Louis 505 N. 7th Street 20th Floor, Suite 2000 St. Louis, MO 63101 www.mhdc.com
Missouri Housing Development Commission Budget for Fiscal Year Ending June 30, 2022
Executive Summary
The proposed Financial Budget for the Fiscal Year ending June 30, 2022 includes information on Fiscal Year 2020 (actual results), Fiscal Year 2021 (projected results and budget), and the proposed Fiscal Year 2022 budget. The budget information is organized by Multifamily mortgage programs, Single Family mortgage programs, and the Operating Fund, including more detailed information on certain Operating Fund revenues and administrative expenses.1
Total Operations (Page 1 of Financial Budget)
For Fiscal Year 2022, results from operations before subsidy programs and special initiatives (Revenues over Expenses from Operations) are budgeted at $19.5 million. Year-to-year trends reflect the levels of federal assistance, investment earnings, bond- financed mortgage income, interest expense on debt and costs to administer MHDC’s housing programs.
Fiscal Year 2022 Budget Highlights
• The Single Family bond-financed programs remain essential to MHDC’s overall operations, representing half of MHDC’s asset base and a significant portion of budgeted Revenues over Expenses from Operations.
• Federal programs that MHDC is administering increased significantly by funding provided by the Coronavirus Aid, Relief and Economic Security (CARES) Act of March 2020, the Consolidated Appropriations Act of December 2020 and the American Rescue Plan Act of March 2021.
• Staffing for core operations is level with additions for personnel administering substantial new federal programs.
• Efforts to carefully plan and manage costs resulted in an overall slight decrease in budgeted administrative costs.
• MHDC is in sound financial position with continued positive returns to support on- going housing programs and initiatives.
1 The effects of fair value reporting (GASB Statement No. 31) are removed from the Financial Budget in order to provide a more meaningful comparative analysis.
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Asset Base (Page 3 of Financial Budget)
MHDC’s asset base totaled approximately $2.5 billion as of March 31, 2021 and has increased 15% from the prior year-end. During the third quarter of fiscal year 2021, MHDC received federal emergency rental assistance funding which totaled $322 million at March 31, 2021. The Single Family bond-financed assets (Homeownership) increased 6% during Fiscal Year 2021. Mortgage assets, including mortgage-backed securities (MBS), total $1.6 billion, comprising 65% of MHDC’s total assets. MHDC’s asset base continues to feature a high-quality, low-risk profile. Approximately 45% of total assets are comprised of guaranteed MBS. MHDC has no subprime loans, no variable rate debt, and no interest rate swaps or similar instruments.
Operating Fund (Page 6 of Financial Budget)
Operating Fund activities include MHDC’s fund balance multifamily lending, general investments, the Missouri Housing Trust Fund, federal grants and assistance, compensation and administrative costs to administer MHDC’s housing programs and MHDC funded subsidy programs.
Included in the Operating Fund is the mortgage-backed securities warehouse program financed primarily with Federal Home Loan Bank (FHLB) advances. The warehouse program provides an important tool for homeownership financing. This program coupled with the Single Family mortgage programs is expected to provide mortgages to 1,440 homeowners in Fiscal Year 2021. For Fiscal Year 2022, homeownership mortgages are anticipated to be financed through continued use of the warehouse program, mortgage revenue bonds and the To-Be-Announced (TBA) market. Similar to the warehouse and bond-financed programs, financing provided by the TBA market provides homebuyer loans for Missouri citizens, with pricing designed to cover program costs, including replenishment of cash assistance, while at the same time limiting risks associated with interest rate changes and non-delivery of mortgages.
The Operating Fund budget for Fiscal Year 2022, including federal programs, includes total revenues of $815.3 million, expenses of $808.9 million and subsidy programs of $2.9 million.
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Grants and Federal Assistance (Page 10 of Financial Budget) have increased substantially. Core ongoing programs include the Section 8 Project-Based Rental Assistance, the HOME Investment Partnerships Program (HOME), the national Housing Trust Fund and Emergency Solutions Grant. Significant additional resources and new programs include funding as provided by the following federal legislation:
• Coronavirus Aid, Relief and Economic Security Act (CARES Act) enacted March 2020 o Emergency Solutions Grant – CV (ESG-CV), including Emergency Rental Arrears Program (ERAP) $28 million • Consolidated Appropriations Act enacted December 2020 o Emergency Rental Assistance 1.0: State Assistance for Housing Relief (SAFHR) $324 million • American Rescue Plan Act enacted March 2021 o Emergency Rental Assistance 2.0: State Assistance for Housing Relief (SAFHR) $323 million o Homeowner Assistance Program $138 million o HOME Investment Partnerships Program – American Rescue Plan (HOME-ARP) $45 million
In addition, MHDC was awarded Project Rental Assistance of Section 811 Supportive Housing for Persons with Disabilities Program funding of $1.4 million.
In total, grants and federal program revenues (Revenues – Grants and Federal Assistance) are budgeted for $789.8 million in Fiscal Year 2022. Expenses from grants and federal programs (Expenses – Grants and Federal Assistance) are budgeted at $784.8 million in Fiscal Year 2022. The difference between the revenue and expense amounts is due to certain HOME funding disbursements being accounted for as loans and capitalized. The U.S. Department of Housing and Urban Development (HUD) Section 8 Project-Based Rental Assistance contract is effective through January 31, 2022, with subsequent extensions anticipated. The Fiscal Year 2022 budget anticipates continuation of the contract through the year.
Compensation and Administrative Expenses (Page 11 of Financial Budget) include salaries, fringe benefits, office occupancy, technology and professional services. Administrative fee revenues, as shown on Page 9 of the Financial Budget, allow MHDC to recover some of the costs incurred for employee compensation and other expenses, including those related to administering certain federal programs.
Compensation (Page 14 of Financial Budget) budgeted for Fiscal Year 2022 reflects additional staff administering additional federal programs and anticipated increased benefit costs. Salaries budgeted for Fiscal Year 2022 include a 2% rate increase for employees effective January 1, 2022, consistent with the State budget. The budget includes thirteen additional positions to administer the substantial federal programs for rental and homeowner assistance. The compensation costs for these additional positions
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are reimbursable by these federal programs and represents less than one percent of the additional $813 million federal resources over the course of these programs. The budgeted benefit costs include an increase in rates for retirement and healthcare costs.
The “Revenue Volume per Employee” chart attached in Exhibit 1 provides comparative information about MHDC’s revenue volume, as a measure of work volume, per employee, as compared to this volume for peer housing finance agencies (HFAs). These are the same HFAs that Standard & Poor's has compared MHDC to in past presentations. MHDC’s revenue per employee was $2.5 million for Fiscal Year 2020, projected to be $3.2 million for Fiscal Year 2021 and budgeted at $7.7 million for Fiscal Year 2022. Excluding new federal programs for rental and homeowner assistance, Budget Year 2022 revenue volume per employee is $3.2 million per employee. As displayed in the chart, MHDC’s revenue per employee is comparable or higher than this volume for peer HFAs.
Administrative expenses include office and information technology costs along with professional costs and travel to support MHDC’s programs. Efforts are made to carefully manage these costs for administering MHDC’s housing programs with the Fiscal Year 2022 budget expenses $15,000 less than the Fiscal Year 2021 budget.
Information Technology costs in Fiscal Years 2020 and 2021 included maintenance of the existing technology infrastructure and line-of-business applications. Included during this period were continued development of improved and enhanced multifamily data management systems. Fiscal Year 2021 included additional enhancements to the agency’s asset management systems. In addition, technology costs incorporated improved systems safeguards which included continued management of the secured co-location data center and server systems upgrades. Additional costs in Fiscal Year 2021 included systems tools and software allowing us to maintain a secure remote workforce during the COVID-19 crisis. The budget for Fiscal Year 2022 includes ongoing technology systems maintenance of infrastructure, data communications, networking, network hardware upgrades and/or replacements and continued software license and maintenance fees. Fiscal Year 2022 will also see continued improvements of multifamily data management systems and content management; and the development of additional enhancements and functionality of the agency’s asset management system. The Information Technology division will continue to focus on the engineering and support of current and future system configurations. With the continually increasing and changing cyber threats, there will be ongoing emphasis on expanding cyber security initiatives to keep pace with the ever growing and more complex risks.
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Travel and related expenses include the costs related to inspections, meetings, public hearings, recipient educational forums and training conferences. The costs of rental cars, mileage, airfare, hotel and meals are included in these costs. Costs related to commission and staff travel are budgeted for Fiscal Year 2022 at $65,000 less than the Fiscal Year 2021 budget, reflecting anticipated staff travel related to training and programs work in accordance with federal guidelines: asset management inspections, compliance inspections, rental production site visits and community initiatives.
Professional and technical expenses include legal, financial advisors, audit, third party inspections and other consulting fees along with costs for temporary staffing and educational training conferences. The costs budgeted for Fiscal Year 2022 are $5,000 less than budgeted for Fiscal Year 2021.
MHDC strives to manage the compensation and administrative expenses required to administer its programs. The “Operating Costs as Percent of Revenues” chart attached in Exhibit 1 provides comparative information about MHDC’s operating costs as compared to peer housing finance agencies (HFAs). MHDC's compensation and administrative expenses are budgeted at 2.3% of revenues for Fiscal Year 2022, and excluding new federal programs for rental and homeowner assistance are 5.8% of revenues and are in line with its peers.
Subsidy Programs and Special Initiatives (Page 12 of Financial Budget) are budgeted at $2.9 million for Fiscal Year 2022. Special initiatives include continuation of rental and operating assistance programs, the Missouri Housing Innovation Program (MoHIP) and disaster relief funding. These programs also include the HUD Note Sale program assistance available for certain multifamily housing projects. The budget for Fiscal Year 2022 incorporates disbursement of the remaining Fiscal Year 2021 awards for Project- Based Rental & Operating Assistance, the Missouri Housing Innovation Program (MoHIP) and Disaster Assistance. The proposed Fiscal Year 2022 Notice of Funds Availability (NOFA) includes Fund Balance subsidy for MoHIP of $810,000, as shown on page 12 of the Financial Budget.
As detailed on page 13 of the Financial Budget, the Operating Fund resources will also continue to provide for low-rate lending for rental housing production and preservation which is budgeted at $10 million for Fiscal Year 2022; continue revolving funds for multifamily construction loans and single family homeownership; and includes funding for homeowner cash assistance and the upfront costs for mortgage revenue bond issues.
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Multifamily Mortgage Programs (Page 7 of Financial Budget)
Multifamily assets total $104.1 million as of March 31, 2021 and have decreased $30.4 million since the prior fiscal year end as the result of scheduled mortgage payments, mortgage prepayments and loans transferred to the Operating Funds in conjunction with the redemption of five bond series. During Fiscal Year 2021, there were no new risk- share bond-financed projects and five mortgage loans prepaid. Overall, Revenues over Expenses from Operations in Fiscal Year 2021 is projected at $886,000. The budget for Fiscal Year 2022 reflects scheduled principal payments on mortgages and related bond issues. Net results of $747,000 million are expected for Fiscal Year 2022, continuing as an important resource for providing affordable rental units to Missourians while, at the same time, continuing to provide a positive return to the Commission for the purposes of supporting general operations and Fund Balance programs.
Single Family Mortgage Programs (Page 8 of Financial Budget)
The Single Family bond-financed asset base increased 6% through March in Fiscal Year 2021 and 16% in Fiscal Year 2020 reflecting new lending offset by mortgage prepayments and related bond redemptions. Single Family bond-financed assets total $1.2 billion as of March 31, 2021, an increase of $75 million during the fiscal year. Single Family bond-financed assets represent 50% of the Commission's total asset base. Loan balances, at cost, consisting of mortgage-backed securities, total $1.1 billion. Principal pay-downs and prepayments were 19% in Fiscal Year 2021, as compared to 15% in Fiscal Year 2020.
The Single Family programs are significant to the Commission’s operations. During Fiscal Year 2021, approximately $215 million in homebuyer mortgages are projected to be provided by the Commission’s bond-financed programs, the Operating Fund mortgage-backed securities warehouse program as discussed above and by sale of mortgage-backed securities via the TBA program.
The Single Family mortgage programs are projected to result in $14.8 million in Revenues over Expenses from Operations in Fiscal Year 2021, representing 52% of the Commission’s total operations. The Fiscal Year 2022 budget amount is $12.4 million based on the following assumptions: continued low short-term interest rates; an increase in mortgage assets with strong mortgage production offset by mortgage paydowns and prepayments. The Fiscal Year 2022 budget volumes reflect $250 million in new lending using bond-financed capital as incorporated in the Strategic Financial Plan "base case." Additional mortgage production is expected to be financed via sale of mortgage-backed securities outside of the bond-financed program. Economic factors may cause
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fluctuations in mortgage production, however, impacting projected mortgage asset and bond financing levels.
Overview/Key Financial Ratios
Fiscal Year 2020 and Fiscal Year 2021 showed continued positive performance in MHDC’s programs, with solid returns reflecting the results of loan programs, bond financings and careful management of resources. Budget Year 2022 projects Revenues from Operations after Subsidy Programs and Special Initiatives at $16.7 million.
The net return from operations excluding special initiatives and subsidy programs (Revenues Over Expenses from Operations) is budgeted at 2.3% for Fiscal Year 2022. Including special initiatives and subsidy programs, the return from operations (Revenues from Operations after Subsidy Programs and Special Initiatives) is budgeted at 1.9% for Fiscal Year 2022. Key financial ratio information is included on page two of the Financial Budget. Return on assets is anticipated at 0.48% for Budget Year 2022, and net interest margin is budgeted at 1.08%. These ratios illustrate MHDC's thin operating margins.
MHDC has maintained its AA+ issuer credit rating (ICR) with stable outlook. Important factors to maintaining this high issuer credit rating are MHDC’s quality asset base, strong equity base, experienced management team, and continued careful management of resources. With continued conservative and diligent management of programs and resources, MHDC is well positioned in the current economic environment and positive returns are expected in Fiscal Year 2022.
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EXHIBIT 1
The following charts compare MHDC actual Fiscal Years 2020 and projected 2021 and Budget Year 2022 to peer housing finance agencies (HFAs). These are the same HFAs that Standard & Poor's has compared to MHDC in past presentations.
For Budget Year 2022, MHDC information includes the full budget as presented and also displays the 'base' budget, which excludes the very large new federal programs: Emergency Rental Assistance and the Homeowner Assistance Fund. This allows for comparison to other HFA available information.
Operating Costs as Percent of Revenues
30.00% 25.43% 25.00% 20.51% 20.00%
14.69% 15.00% 13.40% 12.31% 11.53% 11.10% 9.72% 10.00% 8.00% 5.78% 6.34% 6.41% 4.49% 5.24% 5.00% 2.29%
0.00%
Revenue Volume per Employee 9,000,000 8,000,000 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 ‐
Sources: HFA FY2020 Financial Statements (NV FY2019) and State HFA Factbook ‐ 2019 NCSHA Annual Survey Results
Missouri Housing Development Commission Financial Budget for the Year Ending June 30, 2022 MISSOURI HOUSING DEVELOPMENT COMMISSION
FINANCIAL BUDGET
FOR THE YEAR ENDING JUNE 30, 2022
MISSOURI HOUSING DEVELOPMENT COMMISSION FINANCIAL BUDGET FOR THE YEAR ENDING JUNE 30, 2022
INDEX:
Summary – All Programs – 2020, 2021 and 2022 ...... 1
Financial Ratios ...... 2
Line Graph – Assets by Program – June 2018 through March 2021 ...... 3
Summary – All Programs 2022 ...... 4
Pie Charts – All Programs 2022 ...... 5
Operating Fund – Summary ...... 6
Multifamily Mortgage Programs – Summary (Bond-Financed) ...... 7
Single Family Mortgage Programs – Summary (Bond-Financed & MBS Sales) ...... 8
Operating Fund – Administrative Fees & Financing Fees and Other ...... 9
Operating Fund – Grants and Federal Assistance ...... 10
Operating Fund – Compensation and Administrative Expenses Summary ...... 11
Operating Fund – Subsidy Programs and Special Initiatives ...... 12
i Program Budget – Capitalized Items ...... 13
Operating Fund – Compensation ...... 14
Administrative Expenses (Office Expenses) ...... 15
Administrative Expenses (Information Technology) ...... 15
Administrative Expenses (Commission Meetings, Notices and Travel Expenses) ...... 16
Administrative Expenses (Professional and Technical Expenses) ...... 16
Capital Assets ...... 17
ii SUMMARY Prior Projected Budget Budget Year Year Year Year REVENUES AND EXPENSES (in thousands) 2020 2021 2021 2022
REVENUES: Interest Income - Mortgage Loans$ 58,380 $ 55,027 $ 49,900 $ 50,600 Income - Investments 8,190 4,186 5,500 3,225 Income - MBS Sales 929 720 650 700 Administrative Fees 6,130 6,163 6,374 8,178 Financing Fees and Other 5,675 5,326 3,905 3,771 Missouri Housing Trust Fund Receipts 2,931 3,188 3,170 3,650 Grants and Federal Assistance (page 10) 164,695 267,006 179,364 789,824 Total Revenues 246,930 341,616 248,863 859,948
EXPENSES: Interest Expense on Bonds & Notes 32,900 30,258 30,344 29,154 Bond Debt Expense, Banking Fees & Other 4,462 2,339 2,627 2,591 Compensation (page 11) 11,023 11,060 11,509 13,316 Administrative Expenses (page 11) 4,255 3,738 5,613 5,598 Depreciation (non-cash expense) 372 531 458 772 Provision for Loan Losses - - 500 500 Missouri Housing Trust Fund Grants 3,437 2,247 3,170 3,650 Grants and Federal Assistance (page 10) 160,404 263,131 175,364 784,824 * Total Expenses 216,853 313,304 229,585 840,405
REVENUES OVER EXPENSES FROM OPERATIONS 30,077 28,312 19,278 19,543
SUBSIDY PROGRAMS AND SPECIAL INITIATIVES (page 12) 2,862 3,342 4,276 2,877 *
REVENUES FROM OPERATIONS AFTER SUBSIDY PROGRAMS AND SPECIAL INITIATIVES$ 27,215 $ 24,970 $ 15,002 $ 16,666
The Fiscal Year 2022 budget will continue for purposes of conducting ongoing operations until a subsequent fiscal budget is adopted.
* Budget amounts incorporated for certain Federal programs identified on page 10 and certain subsidy programs and special initiatives identified on page 12 that were approved in previous years will be adjusted to reflect undisbursed funds as of June 30, 2021.
Missouri Housing Development Commission 1 Financial Budget for the Year Ending June 30, 2022 Key Financial Ratios
Financial Ratio Analysis
Five Year Average Financial Ratios2 (2015-2019) (2014-2018)
FY 2021 Projected FY 2022 5-year average All 'AA' All 'AA+' 1 PROFITABILITY 2017 2018 2019 2020 Budget FY 2021 Budget 2017-2021 MHDC HFAs HFAs All HFAs
Return on Average Assets 1.04 1.13 1.12 1.13 0.52 0.96 0.48 1.07 1.04 1.00 0.97 1.24 Return on Assets Before Loan Loss Provision and Extraordinary Item 1.03 1.11 1.08 1.08 0.55 0.86 0.49 1.03 1.03 1.12 0.95 1.31
Net Interest Margin 1.44 1.50 1.54 1.66 1.19 1.37 1.08 1.49 1.47 1.32 1.91 1.51
FY 2021 Projected FY 2022 5-year average All 'AA' All 'AA+' ASSET QUALITY (%) 2017 2018 2019 2020 Budget FY 2021 Budget 2017-2021 MHDC HFAs HFAs All HFAs Non-Performing Assets / Total Loans and Real Estate Owned 0.31 0.25 0.28 0.06 0.06 0.06 0.05 0.19 0.30 2.88 2.82 2.96 Loan Loss Reserves / Total Loans and MBS 3.25 3.12 2.92 2.54 2.62 2.62 2.48 2.89 3.30 4.61 5.70 4.48
FY 2021 Projected FY 2022 5-year average All 'AA' All 'AA+' LEVERAGE (%) 2017 2018 2019 2020 Budget FY 2021 Budget 2017-2021 MHDC HFAs HFAs All HFAs
Total Equity / Total Assets 40.43 40.16 38.88 37.23 38.42 33.02 32.05 37.94 40.28 29.00 35.51 28.33 Total Equity and Reserves / Total Loans and MBS 58.83 58.08 55.74 52.51 54.70 55.27 53.18 56.09 59.25 47.67 60.55 49.42
NOTES 1. MHDC's profitability ratios trend is reflective of the limited risk profile of MHDC's asset base. 2. Historical ratio data per Standard and Poor's Ratings Services.
Missouri Housing Development Commission 2 Budget for the Year Ending June 30, 2022 Assets by Program Mortgage Assets, Investments, Cash and Other Excludes the Effects of Fair Value Reporting June 2018 to March 2021 $1,400,000,000
$1,200,000,000
$1,000,000,000
$800,000,000
$600,000,000
$400,000,000
$200,000,000
$-
Single Family Multifamily Operating Fund Federal Emergency Rental Funds HOME & TCAP
Missouri Housing Development Commission 3 Budget for the Year Ending June 30, 2022 BUDGET YEAR 2022 -- ALL PROGRAMS -- SUMMARY Operating Multifamily Single Family Combined REVENUES AND EXPENSES (in thousands) Fund Programs Programs Totals page 6 page 7 page 8 REVENUES: Interest Income - Mortgage Loans$ 8,100 $ 2,500 $ 40,000 $ 50,600 Income - Investments 2,800 225 200 3,225 Income - MBS Sales - - 700 700 Administrative Fees 8,178 - - 8,178 Financing Fees and Other 2,771 - 1,000 3,771 Missouri Housing Trust Fund Receipts 3,650 - - 3,650 Grants & Federal Assistance 789,824 - - 789,824 TOTAL REVENUES 815,323 2,725 41,900 859,948
EXPENSES: Interest Expense on Bonds & Notes 202 1,952 27,000 29,154 Bond Debt Expense, Banking Fees & Other 65 26 2,500 2,591 Compensation 13,316 - - 13,316 Administrative Expenses 5,598 - - 5,598 Depreciation (non-cash expense) 772 - - 772 Provision for Loan Losses 500 - - 500 Missouri Housing Trust Fund Grants 3,650 - - 3,650 Grants and Federal Assistance 784,824 - - 784,824 TOTAL EXPENSES 808,927 1,978 29,500 840,405
REVENUES OVER EXPENSES FROM OPERATIONS 6,396 747 12,400 19,543
SUBSIDY PROGRAMS AND SPECIAL INITIATIVES (page 12) 2,877 - - 2,877
REVENUES FROM OPERATIONS AFTER SUBSIDY PROGRAMS AND SPECIAL INITIATIVES$ 3,519 $ 747 $ 12,400 $ 16,666
Missouri Housing Development Commission 4 Financial Budget for the Year Ending June 30, 2022 Budget Summary - All Programs
Revenues Expenses
Multifamily Multifamily Operating Operating Mortgage Mortgage Funds Single Family Funds Single Family Programs Programs 3.0% Mortgage 3.2% Mortgage 0.3% Programs 0.2% Programs 4.9% 3.5%
Federal Federal Assistance Assistance 91.8% 93.1%
Missouri Housing Development Commission 5 Financial Budget for the Year Ending June 30, 2022 OPERATING FUND -- SUMMARY Prior Projected Budget Budget Year Year Year Year REVENUES AND EXPENSES (in thousands) 2020 2021 2021 2022
REVENUES: Interest Income - Mortgage Loans *$ 11,283 $ 9,977 $ 7,500 $ 8,100 Income - Investments 6,710 3,800 4,100 2,800 Administrative Fees (page 9) 6,130 6,163 6,374 8,178 Financing Fees and Other (page 9) 2,933 3,326 2,905 2,771 Missouri Housing Trust Fund Receipts 2,931 3,188 3,170 3,650 Grants and Federal Assistance (page 10) 164,695 267,006 179,364 789,824 TOTAL REVENUES 194,682 293,460 203,413 815,323
EXPENSES: Interest Expense on Bonds & Notes ** 565 100 672 202 Bond Debt Expense, Banking Fees & Other 62 47 65 65 Compensation (page 11) 11,023 11,060 11,509 13,316 Administrative Expenses (page 11) 4,255 3,738 5,613 5,598 Depreciation (non-cash expense) 372 531 458 772 Provision for Loan Losses - - 500 500 Missouri Housing Trust Fund Grants *** 3,437 2,247 3,170 3,650 Grants and Federal Assistance (page 10) 160,404 263,131 175,364 784,824 TOTAL EXPENSES 180,118 280,854 197,351 808,927
REVENUES OVER EXPENSES FROM OPERATIONS 14,564 12,606 6,062 6,396
SUBSIDY PROGRAMS AND SPECIAL INITIATIVES (page 12) 2,862 3,342 4,276 2,877
REVENUES FROM OPERATIONS AFTER SUBSIDY PROGRAMS AND SPECIAL INITIATIVES$ 11,702 $ 9,264 $ 1,786 $ 3,519
* Fiscal Year 2020 includes a $3.3 million cash flow note payoff. ** Includes Federal Home Loan Bank advances and interest expense on HUD debenture.
*** The timing of Missouri Housing Trust Fund expenditures follows receipts by 15-18 months.
Missouri Housing Development Commission 6 Financial Budget for the Year Ending June 30, 2022 MULTIFAMILY MORTGAGE PROGRAMS -- SUMMARY (Bond-Financed) Projected Budget Budget Year Year Year Year REVENUES AND EXPENSES (in thousands) 2020 2021 2021 2022
REVENUES: Interest Income - Mortgage Loans$ 5,115 $ 3,400 $ 3,600 $ 2,500 Income - Investments 450 236 450 225 Financing Fees and Other 114 - - - TOTAL REVENUES 5,679 3,636 4,050 2,725
EXPENSES: Interest Expense on Bonds & Notes 4,019 2,678 2,672 1,952 Bond Debt Expense, Banking Fees & Other 59 72 62 26 TOTAL EXPENSES 4,078 2,750 2,734 1,978
REVENUES OVER EXPENSES FROM OPERATIONS$ 1,601 $ 886 $ 1,316 $ 747
In Fiscal Year 2021 bonds were redeemed as a result of five mortgage loan prepayments. One bond refinancing was issued and the prior bonds were redeemed. In addition, five bond series totaling $8.4 million were redeemed and the corresponding mortgage loans transferred to the Operating Fund. The remaining portfolio includes 38 mortgage loans financed by nine bond issues.
Missouri Housing Development Commission 7 Financial Budget for the Year Ending June 30, 2022 SINGLE FAMILY MORTGAGE PROGRAMS -- SUMMARY (Bond-Financed & MBS Sales) Prior Projected Budget Budget Year Year Year Year REVENUES AND EXPENSES (in thousands) 2020 2021 2021 2022
REVENUES: Interest Income - Mortgage Loans$ 41,982 $ 41,650 $ 38,800 $ 40,000 Income - Investments 1,030 150 950 200 Income - MBS Sales 929 720 650 700 Financing Fees and Other * 2,628 2,000 1,000 1,000 TOTAL REVENUES 46,569 44,520 41,400 41,900
EXPENSES: Interest Expense on Bonds & Notes 28,316 27,480 27,000 27,000 Bond Debt Expense, Banking Fees & Other 4,341 2,220 2,500 2,500 TOTAL EXPENSES 32,657 29,700 29,500 29,500
REVENUES OVER EXPENSES FROM OPERATIONS$ 13,912 $ 14,820 $ 11,900 $ 12,400
Single Family Mortgage Revenue Bonds and Mortgage Backed Security Sales New Loans $ 339,000 $ 215,000 $ 185,000 $ 295,000 Approximate Number Loans Made 2,558 1,440 1,400 1,750
The Single Family asset base has increased in Fiscal Years 2020 and 2021 as shown in the graph on page 3. Loan balances increased 2% to $1.1 billion in 2020 as of 3/31/21. Principal pay downs and prepayments are 19% in 2021 compared to 15% paydowns in 2020. Mortgage revenue bonds totaling $213 million were issued in FY2021 while approximately $202 million in bond principal is expected to be paid by fiscal year end. The FY2022 budget anticipates $295 million in new lending to be funded by $250 million mortgage revenue bonds and $45 million mortgage-backed security sales. In addition, the FY2022 budget anticipates continued prepayment activity and low interest rates. Economic factors may result in lower mortgage production, reducing mortgage asset and bond financing levels diminishing interest income and bond interest expense levels.
* - Includes gain on debt extinguishment of approximately $2.0 million in FY2021 ($2.6 million in FY2020). Limited gains on debt extinguishment are included for Budget Years 2021 and 2022.
Missouri Housing Development Commission 8 Financial Budget for the Year Ending June 30, 2022 OPERATING FUND -- ADMINISTRATIVE FEES & FINANCING FEES AND OTHER Prior Projected Budget Budget ADMINISTRATIVE FEES & Year Year Year Year FINANCING FEES AND OTHER (in thousands) 2020 2021 2021 2022
ADMINISTRATIVE FEES: * Section 8 Project-Based Rental Assistance$ 5,045 $ 4,700 $ 4,700 $ 4,700 ** HOME Investment Partnerships Program 820 796 700 950 Emergency Solutions Grant 38 200 259 250 National Housing Trust Fund 72 112 600 600 SAFHR (Emergency Rental Assistance) - 280 - 1,059 Mortgage Assistance Program (Homeowner Assistance Fund) - - - 484 Project Rental Assistance (Section 811 Supportive Housing) - - - 50 Mortgage Credit Certificates 63 45 100 65 IRP Admin & 15 Year Opt-Out Fees 40 30 15 20 Continuum of Care Planning Grant 52 - - - TOTAL ADMINISTRATIVE FEES$ 6,130 $ 6,163 $ 6,374 $ 8,178
FINANCING FEES AND OTHER: Tax Credit Application & Monitoring Fees$ 1,685 $ 1,879 $ 1,800 $ 1,800 MIP Premium 233 141 200 100 Construction/Rehab Monitoring Fees *** 185 320 300 300 Financing Fees 304 370 350 350 TCAP/TCR Monitoring Fees 132 132 132 132 Servicing, Issuer and Other Fees 122 119 88 84 Other (Including Property Owned Net Earnings) 272 365 35 5 TOTAL FINANCING FEES AND OTHER$ 2,933 $ 3,326 $ 2,905 $ 2,771
* Administrative Fees allow MHDC to recover a portion of the costs incurred for employee compensation and other expenses, including those related to administering federal programs.
** Contract with HUD terminates January 31, 2022 with subsequent modifications or extensions anticipated. HUD is expected to competitively bid the program administration at a future time. Administrative Fee Revenue assumes contract continuation at a reduced fee level.
*** Fiscal Year 2020 reflects lower revenue due to timing of project construction commencement.
Missouri Housing Development Commission 9 Financial Budget for the Year Ending June 30, 2022 OPERATING FUND -- GRANTS AND FEDERAL ASSISTANCE Prior Projected Budget Budget Federal Year Year Year Year Funding GRANTS AND FEDERAL ASSISTANCE (in thousands) 2020 2021 2021 2022
REVENUES: Federal Programs Section 8 Project-Based Rental Assistance *$ 152,808 $ 155,000 $ 152,000 $ 157,000 $ 157,000 HOME Investment Partnerships Program ** ◊ 6,480 6,675 9,000 50,000 57,705 National Housing Trust Fund ** ◊ 2,203 1,000 6,000 6,000 6,000 Emergency Solutions Grant 3,010 20,400 12,364 30,993 30,993 SAFHR (Emergency Rental Assistance) # - 70,000 - 420,000 647,000 Mortgage Assistance Program (Homeowner Assistance Fund) # - 13,827 - 124,442 138,269 Project Rental Assistance (Section 811 Supportive Housing) - - - 1,389 1,389 Continuum of Care Planning Grant 46 - - - - Community Services Block Grant 148 104 - - - TOTAL FEDERAL PROGRAM REVENUES$ 164,695 $ 267,006 $ 179,364 $ 789,824 $ 898,698
EXPENSES: Federal Programs Section 8 Project-Based Rental Assistance *$ 152,808 $ 155,000 $ 152,000 $ 157,000 HOME Investment Partnerships Program ** *** ◊ 2,189 2,800 5,000 45,000 National Housing Trust Fund ** *** ◊ 2,203 1,000 6,000 6,000 Emergency Solutions Grant 3,010 20,400 12,364 30,993 SAFHR (Emergency Rental Assistance) # - 70,000 - 420,000 Mortgage Assistance Program (Homeowner Assistance Fund) # - 13,827 - 124,442 Project Rental Assistance (Section 811 Supportive Housing) - - - 1,389 Continuum of Care Planning Grant 46 - - - Community Services Block Grant 148 104 - - TOTAL FEDERAL PROGRAM EXPENSES$ 160,404 $ 263,131 $ 175,364 $ 784,824
* Contract with HUD terminates January 31, 2022 with subsequent modifications or extensions anticipated. HUD is expected to competitively bid the program administration at a future time. Revenue and expense assumes contract continuation. ** The HOME Investment Partnerships Program and National Housing Trust Fund allow MHDC 2 years to commit awarded funds and 4 years in which to expend those funds. Budget Year 2022 Revenues consist of funds included in the Federal FY 2021 budget expected to be awarded to MHDC. Also included are prior year allocations awarded and expected to be drawn in Budget Year 2022. *** Represent grants made. The balance of funds received are considered as loans and capitalized. ◊ Projected Fiscal Year 2021 revenue and expense below budget estimates due to timing of project construction commencement. # Budget amounts presented will be adjusted to reflect available as of June 30, 2021.
Missouri Housing Development Commission 10 Financial Budget for the Year Ending June 30, 2022 OPERATING FUND -- COMPENSATION AND ADMINISTRATIVE EXPENSES SUMMARY Prior Projected Budget Budget COMPENSATION AND Year Year Year Year ADMINISTRATIVE EXPENSES SUMMARY (in thousands) 2020 2021 2021 2022
COMPENSATION Salaries (see page 14)$ 5,750 $ 5,973 $ 5,915 $ 6,866 Fringe Benefits (see page 14) 5,273 5,087 5,594 6,450 TOTAL COMPENSATION$ 11,023 $ 11,060 $ 11,509 $ 13,316
ADMINISTRATIVE EXPENSES Office Expenses (see page 15)$ 1,665 $ 1,469 $ 1,807 $ 1,741 Information Technology (see page 15) 1,077 1,090 1,386 1,507 Commission Meetings, Notices and Travel Expenses (see page 16) 344 81 542 477 Professional and Technical Expenses (see page 16) 1,169 1,098 1,878 1,873 TOTAL ADMINISTRATIVE EXPENSES$ 4,255 $ 3,738 $ 5,613 $ 5,598
Missouri Housing Development Commission 11 Financial Budget for the Year Ending June 30, 2022 OPERATING FUND -- SUBSIDY PROGRAMS AND SPECIAL INITIATIVES (Continuing Programs) Prior Projected Budget Budget Year Year Year Year SUBSIDY PROGRAMS AND SPECIAL INITIATIVES (in thousands) 2020 2021 2021 2022
Fund Balance Program Expenses: * Project-Based Rental & Operating Assistance **$ 162 $ 365 $ 470 $ 470 Missouri Housing Innovation Program (MoHIP) ** *** 910 777 852 885 Disaster Assistance ** # 236 1,055 1,598 611 Emergency Solutions Grant Supplement 880 398 445 - Interest Subsidy 1 1 1 1 2,189 2,596 3,366 1,967 Grants (HUD Purchase Loan Program and Rural Initiative) Tenant Initiatives ◊ 487 480 480 480 Rehab and Repairs ◊ - 240 240 240 Rural Initiative ** 186 26 190 190 673 746 910 910 TOTAL SUBSIDY PROGRAMS AND SPECIAL INITIATIVES$ 2,862 $ 3,342 $ 4,276 $ 2,877
Project-Based Rental & Operating Assistance, the Missouri Housing Innovation Program and Interest Subsidy are supported by earnings from restricted investments totaling $67 million, with any excess earnings reinvested for these restricted uses for future anticipated needs. These investments also provide collateral to support the MBS Warehousing Program.
* Additional funds are being expended for Fund Balance programs, as described on page 13, for which MHDC is capitalizing and recovering through loan repayments and other program structure features. ** FY2022 Budget amounts presented will be adjusted to reflect undisbursed funds for approved grants as of June 30, 2021. The funding for these grants is included as projected for FY2021 with the FY2022 budget including amounts anticipated to be expended after July 1, 2021. # Disaster Assistance provides a ready resource to serve state-declared disaster areas with emergency housing assistance. *** Includes FY2022 funding for NOFA of $810,000. Grant period expected April 1, 2022 to March 31, 2023. Portion expected to be incurred subsequent to FY2022 of $682,000.
◊ Since the purchase of 26 loans from HUD in 1996, principal and interest payment funds ($34 million) have been collected which are available for rehabilitation work and tenant initiatives ($22 million through FY21). $12 million is available to provide continued support of these projects.
Missouri Housing Development Commission 12 Financial Budget for the Year Ending June 30, 2022 PROGRAM BUDGET -- CAPITALIZED ITEMS Prior Projected Budget Budget FY 2022 Year Year Year Year Available PROGRAM (in thousands) 2020 2021 2021 2022 Funds
Rental Housing Production and Preservation Program (1)$ 9,788 $ 8,920 $ 10,000 $ 10,000 $ 10,000 Construction Loan Program (2) 11,047 12,375 - - 47,000 Single Family Homeownership Program (3) 8,440 4,008 - - 20,000 Homeowner Cash Assistance Funding (4) 12,950 7,580 - - 21,500 First Place MRB Program Cost of Issuance & Capitalized Interest (5) 4,230 3,755 3,600 4,000 4,000 TOTAL $ 46,455 $ 36,638 $ 13,600 $ 14,000 $ 102,500
(1) These loans are capitalized and are scheduled for repayment. Commitment and disbursement of permanent multifamily loan funds may occur over multiple fiscal years. In FY2021 $8.0 million of Rental Housing Production and Preservation Program funds were committed.
(2) This revolving fund totaling $47 million program funding, is used to make multifamily construction loans.
(3) This $20 million fund is used to finance GNMA, Fannie Mae or FHLMC mortgage-backed securities (MBS) in conjunction with MHDC's First Place bond program, or direct sale including forward delivery, as a source of continuous lending since 2009.
(4) This established funding totaling $21.5 million is used for cash assistance to fund homeownership closing costs and down payment. This cash assistance is recovered by means of the first mortgage financing and amortizing seconds. Recovered funds are recycled and reused for this same purpose.
(5) Budgeted amounts for Single Family MRB cost of issuance, capitalized interest and over-collateralization are estimated with issuances consisting of mortgage revenue bonds. The cost of issuance portion is accounted for as an expense as shown on page 8.
Missouri Housing Development Commission 13 Financial Budget for the Year Ending June 30, 2022 OPERATING FUND -- COMPENSATION Prior Projected Budget Budget Year Year Year Year COMPENSATION (in thousands) 2020 2021 2021 2022
Salaries $ 5,750 $ 5,973 $ 5,915 $ 6,866 * Fringe Benefits (see below) 5,273 5,087 5,594 6,450 TOTAL COMPENSATION$ 11,023 $ 11,060 $ 11,509 $ 13,316
New Federal Programs - 280 - 1,543 Total Compensation without New Federal Programs$ 11,023 $ 10,780 $ 11,509 $ 11,773
Employee Count 98 108 99 112
New Federal Programs - 9 - 13 Employee Count without New Federal Programs 98 99 99 99
FRINGE BENEFITS DETAIL Retirement (state pension) ** 3,251 2,641 3,084 3,614 Social Security OASDI 357 371 367 425 Medicare 84 87 86 100 Health Insurance 990 1,095 1,092 1,290 Life Insurance 320 333 363 401 Long Term Disability 25 26 32 38 Unemployment - 1 5 5 Retiree Health & Life Insurance Surcharge 246 533 565 577 TOTAL FRINGE BENEFITS$ 5,273 $ 5,087 $ 5,594 $ 6,450
For those expenses (salary and other expenses) that are directly related to the administration of federal programs, MHDC is able to recover, through Administrative Fees, a portion of those expenses that can be documented. These Administrative Fees are detailed on page 9.
* Salaries include a 2% increase for employees effective January 1, 2022, consistent with the State budget.
** Required contribution rates are 21.77%, 22.88% and 23.78% for FY2020, FY2021 and FY2022, respectively. In addition, the retirement expense includes the impact of recognition of MHDC's proportionate share of the net pension plan liability in accordance with governmental accounting standards.
Missouri Housing Development Commission 14 Financial Budget for the Year Ending June 30, 2022 OPERATING FUND -- ADMINISTRATIVE EXPENSES Prior Projected Budget Budget Year Year Year Year (in thousands) 2020 2021 2021 2022
OFFICE EXPENSES Office Supplies, Postage and Other Expenses $ 129 $ 85 $ 190 $ 190 Bank Service Charges 76 75 75 75 Dues and Subscriptions 110 80 80 80 Office Occupancy 803 740 851 835 Rent - Equipment 4 4 7 6 Insurance Expenses 225 248 245 250 Telephone Expense 79 47 120 85 Administrative Charge (Department of Economic Development) (1) 239 190 239 220 TOTAL OFFICE EXPENSES$ 1,665 $ 1,469 $ 1,807 $ 1,741
(1) Administrative charges are allocated by the Department of Economic Development to agencies, such as MHDC, that are within its organizational structure.
INFORMATION TECHNOLOGY Hardware (Server/Workstations, Including Leases)$ 41 $ 19 $ 25 $ 25 Support Services for Network & Client 205 110 215 185 Software Licensing & System Security (2) 151 116 239 299 Business Application Software (3) 559 710 795 886 Training 9 1 18 18 Communications 112 134 94 94 TOTAL INFORMATION TECHNOLOGY AS EXPENSED$ 1,077 $ 1,090 $ 1,386 $ 1,507
(2) Includes increased licensing and security costs (3) Includes annual maintenance on existing software, including increased costs for software added in recent years
See page 17 regarding Software & Hardware purchases capitalized.
Missouri Housing Development Commission 15 Financial Budget for the Year Ending June 30, 2022 OPERATING FUND -- ADMINISTRATIVE EXPENSES Prior Projected Budget Budget Year Year Year Year (in thousands) 2020 2021 2021 2022
COMMISSION MEETINGS, NOTICES AND TRAVEL EXPENSES Commissioners' Per Diem$ 2 $ 3 $ 4 $ 4 Commissioners' Travel 4 5 10 10 Staff Travel Expenses 209 21 340 275 Commission Meeting and Public Hearing Expenses 33 10 43 43 Public Notices and Community Outreach & Education 96 42 145 145 TOTAL COMMISSION MEETINGS, NOTICES AND TRAVEL EXPENSES$ 344 $ 81 $ 542 $ 477
Staff travel includes attendance at meetings, training and responsibilities related to asset management and administering the various federal grants and contracts.
PROFESSIONAL AND TECHNICAL EXPENSES Professional Services$ 548 $ 565 $ 908 $ 918 Construction Services 276 300 470 470 Temporary Services 294 209 350 350 Technical Services & Other 20 - 65 50 Conferences and Educational Seminars 31 24 85 85 TOTAL PROFESSIONAL AND TECHNICAL EXPENSES$ 1,169 $ 1,098 $ 1,878 $ 1,873
The significant expenditures in professional services include fees for legal services, financial advisors, rating agency services, technical assistance and external financial auditors. Construction services includes inspection and other fees. Temporary services reflect temporary stopgap staffing solutions. The principal expenditures for conferences and educational seminars are related to administration of federal programs.
Missouri Housing Development Commission 16 Financial Budget for the Year Ending June 30, 2022 OPERATING FUND -- CAPITAL ASSETS Prior Projected Budget Budget Year Year Year Year CAPITAL ASSETS (in thousands) 2020 2021 2021 2022
Software and Equipment$ 992 $ 875 $ 875 $ 875
The above represents costs for capital assets with an estimated useful life in excess of one year and includes software systems, office space improvements, furniture and equipment for purchases greater than $5,000. Capitalized software includes initiatives to enhance multifamily software and database systems. Depreciation as reflected on page 6 is calculated using the straight-line method over the estimated useful lives of the assets, which generally range from three to ten years.
Missouri Housing Development Commission 17 Financial Budget for the Year Ending June 30, 2022 4) Report of Staff d. Single Family Mortgage Revenue Bonds – Resolution No. 1065
June 22, 2021
TO: Board of Commissioners Missouri Housing Development Commission
Mike Parson FROM: Marilyn Lappin Governor Director of Finance Mike Kehoe Lieutenant Governor SUBJECT: Resolution No. 1065 – Authorizing the Issuance of Single Family Chairman Mortgage Revenue Bonds (First Place Homeownership Loan Scott Fitzpatrick Program) State Treasurer
Eric Schmitt Attorney General
Tracey S.C. Lewis The Commission’s First Place loan program serves an important home buying population Vice Chairman in Missouri. The First Place loan program offers first-time homebuyers and veterans Mark Elliff competitive 30-year fixed-rate mortgage financing to buy a home. The Commission funds Secretary-Treasurer the First Place loan program through the issuance of single family mortgage revenue Rick McDowell bonds, which Standard & Poor’s rates AA+ due to the high-quality mortgages pooled as Commissioner guaranteed Ginnie Mae and Freddie Mac mortgage-backed securities, as well as the strong Garrick Hamilton credit quality investments and cash flow sufficiency. Commissioner Danny P. Chadakhtzian During fiscal year 2021, single family mortgage revenue bonds totaling $213 million were Commissioner sold and provided mortgage financing for approximately 1,430 first time homebuyers. Stephen J. Parshall Additional bond authority will position the Commission well throughout the next year to Commissioner utilize bond financing for continued financing of the First Place program.
Attached is Resolution No. 1065 which authorizes issuance of single family mortgage
revenue bonds in one or more series for a total amount not to exceed $300 million. The Kip Stetzler Executive Director bonds are limited obligations of the Commission payable solely from the mortgage assets pledged to the payment of the bonds. The bonds do not constitute a debt or general obligation or a pledge of the faith and credit of the State of Missouri or any political Kansas City 920 Main, Suite 1400 subdivision thereof but constitute limited obligations of the Commission payable solely Kansas City, MO 64105 from the moneys and property specifically pledged to the payment of the bonds. 816-759-6600 Fax 816-301-7000 Recommendation: St. Louis Staff recommends approval of Resolution No. 1065 authorizing the issuance of single 505 N. 7th Street family mortgage revenue bonds in an amount not to exceed $300 million. 20th Floor, Suite 2000 St. Louis, MO 63101 . www.mhdc.com
RESOLUTION NO. 1065
A RESOLUTION AUTHORIZING AND PROVIDING FOR CONTINUATION OF THE FIRST PLACE HOMEOWNERSHIP LOAN PROGRAM; AUTHORIZING THE ISSUANCE BY THE MISSOURI HOUSING DEVELOPMENT COMMISSION OF ITS SINGLE FAMILY MORTGAGE REVENUE BONDS (FIRST PLACE HOMEOWNERSHIP LOAN PROGRAM), IN ONE OR MORE SERIES, FOR THE PURPOSES OF ACQUIRING NEW GUARANTEED MORTGAGE SECURITIES AND/OR REFUNDING ONE OR MORE SERIES OF SINGLE FAMILY MORTGAGE REVENUE BONDS PREVIOUSLY ISSUED BY THE COMMISSION IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $300,000,000; APPROVING AND AUTHORIZING THE EXECUTION AND DELIVERY OF ONE OR MORE BOND PURCHASE AGREEMENTS, SERIES SUPPLEMENTS FOR EACH SERIES, LENDER/SERVICER AGREEMENTS, CONTINUING DISCLOSURE AGREEMENTS AND OTHER DOCUMENTS RELATED THERETO; APPROVING THE FORMS AND AUTHORIZING THE EXECUTION AND DELIVERY OF SAID BONDS; APPROVING THE USE OF ONE OR MORE PRELIMINARY OFFICIAL STATEMENTS AND THE USE AND EXECUTION OF ONE OR MORE OFFICIAL STATEMENTS IN CONNECTION WITH THE SALE OF SAID BONDS; AND AUTHORIZING THE OFFICERS, EMPLOYEES AND REPRESENTATIVES OF THE COMMISSION TO DO AND PERFORM ALL THINGS NECESSARY, APPROPRIATE AND INCIDENTAL THERETO.
WHEREAS, there exists within the State of Missouri (the "State") a recognized shortage of decent, safe and sanitary housing for low and moderate income persons and families; and
WHEREAS, pursuant to Sections 215.010 to 215.250, inclusive, Revised Statutes of Missouri, and Appendix B(1) thereto, as amended (collectively, the "Act"), the Missouri Housing Development Commission (the "Commission") is authorized to issue and sell revenue bonds in order to aid in providing an adequate supply of residential housing for low and moderate income persons or families and for the purpose of purchasing mortgages and notes evidencing loans for the construction, rehabilitation or purchase of single family residential housing and to refund revenue bonds previously issued for such purposes; and
WHEREAS, the Commission, pursuant to Resolution No. 1043, approved March 16, 2015, as amended (the "March 2015 Resolution"), and the Indenture of Trust, dated as of May 1, 2015, as amended by the Amendatory Supplemental Indenture dated as of June 1, 2019, and as further amended (the "Master Indenture"), between the Commission and UMB Bank, N.A. (the "Trustee"), has authorized the establishment of the First Place Homeownership Loan Program; and
WHEREAS, the Commission hereby deems and determines it necessary, desirable and in the public interest to provide for the continuation of said First Place Homeownership Loan Program and the issuance of one or more additional series of revenue bonds in accordance with the Master Indenture for the aforementioned purposes.
NOW, THEREFORE, IT IS HEREBY RESOLVED BY THE MISSOURI HOUSING DEVELOPMENT COMMISSION AS FOLLOWS:
Section 1. Definitions. All words and phrases not otherwise defined herein shall have the respective meanings set forth in the Master Indenture and any Series Supplement entered into between the Commission and the Trustee in connection with the issuance of a series of the hereinafter defined Bonds (each, a "Series Supplement"), unless a different meaning clearly appears in context.
Section 2. Declaration of Purposes. It is hereby declared and determined that the purpose of this Resolution is to provide a means of financing the costs of acquiring single family residential property to provide adequate, safe and sanitary housing for low and moderate income persons and families in accordance with the Act.
Section 3. Continuation of First Place Homeownership Loan Program. The First Place Homeownership Loan Program (the "Program") created and established pursuant to the Act, the March 2015 Resolution and the Master Indenture shall be further implemented and administered as provided in this Resolution, the Master Indenture, the Series Supplements and the other financing documents authorized pursuant to this Resolution.
Section 4. Execution of the Series Supplements; Designation of Trustee. For the purposes set forth in Section 5, the Chairman, Executive Director, Director of Operations, Director of Finance, Fiscal & Accounting Manager, Secretary or Assistant Secretary are hereby authorized to execute and affix the official seal of the Commission to the Series Supplements. The Series Supplements shall be in substantially the same form as the Series Supplements entered into by the Commission in connection with the issuance of other series of single family mortgage revenue bonds previously issued by the Commission pursuant to the Master Indenture, with such changes or amendments thereto as the officer executing each such Series Supplement shall approve, which approval shall be conclusively evidenced by his or her execution of said document.
UMB Bank, N.A., is hereby designated to serve in the capacity of Trustee under and pursuant to the terms of the Series Supplements.
Section 5. Authorization for Issuance of Bonds; Execution of the Bonds. In order to provide funds necessary for continuation of the Program, there are hereby authorized to be issued and delivered pursuant to the Act and this Resolution and under and in accordance with the Master Indenture and the applicable Series Supplement revenue bonds to be designated "Missouri Housing Development Commission Single Family Mortgage Revenue Bonds (First Place Homeownership Loan Program)" in an aggregate principal amount not to exceed $300,000,000, the proceeds of which will be applied to acquire new Guaranteed Mortgage Securities and/or to refund one or more series of single family mortgage revenue bonds previously issued by the Commission (jointly, the "Bonds"), with series designations as provided in Section 11. The Bonds may be issued in one or more series and shall mature on the respective dates (not later than June 1, 2057) and in the amounts specified in the applicable Series Supplement, and shall be payable on the dates, bear interest at the rates (producing an average yield not to exceed 4.50% per annum) and be dated as set forth in the applicable Series Supplement and shall be in the form and shall be subject to redemption and payment prior to their respective maturities, all as set forth and specified in the Master Indenture and the applicable Series Supplement. The Chairman or Vice Chairman and the Executive Director, Secretary or Assistant Secretary are hereby authorized to execute the Bonds by their manual or facsimile signatures in the manner specified in the Master Indenture and to affix or cause to be imprinted thereon the official seal of the Commission.
Section 6. Sale of the Bonds; Approval of Official Statement. The Bonds shall be sold and delivered to the order of the purchasers thereof (collectively, the "Purchasers") in accordance with the terms and conditions of the Bond Purchase Agreements relating to each series of Bonds between the Commission and the Purchasers (each, a "Purchase Contract"). The Chairman, Executive Director, Director of Operations, Director of Finance or Fiscal & Accounting Manager are hereby authorized to execute and deliver such Purchase Contracts in substantially the same form as the Purchase Contracts entered into by the Commission in connection with the issuance of other series of single family mortgage revenue bonds previously issued by the Commission pursuant to the Master Indenture, with such changes or amendments
-2-
thereto as the officer executing such Purchase Contracts shall approve, which approval shall be conclusively evidenced by his or her execution of said Purchase Contracts.
The forms of the Preliminary Official Statements (each, a "Preliminary Official Statement") and the final Official Statements (each, an "Official Statement") and the use and distribution thereof by the Purchasers in connection with the offering and sale of each series of Bonds are hereby ratified and approved in substantially the same forms as the Preliminary Official Statements and final Official Statements distributed by the Commission in connection with the issuance of other series of single family mortgage revenue bonds previously issued by the Commission pursuant to the Master Indenture. The Chairman, Executive Director, Director of Operations, Director of Finance or Fiscal & Accounting Manager are hereby authorized to execute and deliver the Official Statements, with such changes or amendments thereto as the officer executing such Official Statements shall approve, which approval shall be conclusively evidenced by such officer's execution of said Official Statements.
Section 7. Approval of Lender/Servicer Agreements and Continuing Disclosure Agreements. The Chairman, Executive Director, Director of Operations, Director of Finance or Fiscal & Accounting Manager are hereby authorized to execute and deliver, for and on behalf of the Commission, origination, servicing and administration agreements with the mortgage lending and servicing institutions signatory thereto relating to the Bonds (the "Lender/Servicer Agreements") and one or more Continuing Disclosure Agreements, relating to the Bonds (the "Disclosure Agreements"), each in substantially the same forms as the origination, servicing and administration agreements and Continuing Disclosure Agreements entered into by the Commission in connection with the issuance of other series of single family mortgage revenue bonds previously issued by the Commission pursuant to the Master Indenture, with any changes therein as the officer executing such Lender/Servicer Agreements and Disclosure Agreements shall approve, his or her execution being conclusive evidence of such approval.
Section 8. Further Authority. The Chairman, Executive Director, Director of Operations, Director of Finance or Fiscal & Accounting Manager are hereby further authorized and directed to execute any and all documents and agreements required to be executed pursuant to the Master Indenture and the Series Supplements or necessary or convenient for the Program, including any agreements authorized by the Master Indenture or the Series Supplements with respect to the investment of moneys held in the funds and accounts under the Master Indenture, agreements relating to the servicing of the mortgage loans and documents relating to the sale of Guaranteed Mortgage Securities financed with the proceeds of prior bonds of the Commission. The Chairman, the Secretary, the Assistant Secretary, the Executive Director, the Director of Operations, the Director of Finance, the Fiscal & Accounting Manager, and other officers of the Commission, its attorneys and other agents, consultants or employees and the officers and employees of the Trustee are hereby authorized and directed to (i) furnish such information, execute such instruments and take such other action in cooperation with the Purchasers as the Purchasers may reasonably request to qualify the Bonds for offer and sale under the Blue Sky or other securities laws and regulations of such states and other jurisdictions of the United States as the Purchasers may designate (provided, however, the Commission shall not be required to register as a dealer or broker in any such state or jurisdiction or make any additional representations or warranties in connection with the sale of securities, or to subject itself to service of process in any state or jurisdiction in which it is not already so subject) and (ii) do and perform all acts and things required of them by the provisions of this Resolution, the Purchase Contract, the Master Indenture, the Series Supplements and the Lender/Servicer Agreements necessary or incidental for the purpose of implementing and carrying out the Program, the issuance and delivery of the Bonds, and the full, punctual and complete performance of all of the terms, covenants, provisions and agreements set forth herein, in the Bonds, the Purchase Contract, the Master Indenture, the Series Supplements, the Lender/Servicer Agreements and the Disclosure Agreement.
-3-
Section 9. Authority. This Resolution is adopted under the authority of the Act.
Section 10. Severability. If any section, paragraph, clause or provision of this Resolution shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such section, paragraph, clause or provision shall not affect any remaining provisions of this Resolution.
Section 11. Series Designations; Authority to Modify. The Chairman, Executive Director, Director of Operations, Director of Finance and/or Fiscal & Accounting Manager are hereby authorized to cause each series of the Bonds to be designated by the year in which issued and by alphabetical order within such year; provided, that such series designations may be further modified such that Bonds issued under the Master Indenture are assigned series designations in accordance with the chronological order of issuance of such Bonds or otherwise at the discretion of the Chairman, Executive Director, Director of Operations, Director of Finance or Fiscal & Accounting Manager.
Section 12. Reimbursement of Expenditures; Official Intent. The Commission declares its intent to borrow the proceeds of the Bonds to finance or refinance the costs of acquisition of mortgage- backed securities, and to reimburse the Commission for expenditures made by the Commission to acquire mortgage-backed securities prior to the issuance of the Bonds.
Section 13. Effective Date. This Resolution shall be in full force and effect from and after its adoption by the Commission.
-4- PASSED BY THE MISSOURI HOUSING DEVELOPMENT COMMISSION THIS 22ND DAY OF JUNE, 2021.
MISSOURI HOUSING DEVELOPMENT COMMISSION
By: Chairman
ATTEST:
Assistant Secretary
MHDC SF Bond Resolution S-1 4) Report of Staff e. Mortgage Credit Certificate (MCC) – Resolution No. 1066
June 22, 2021
To: Commissioners Missouri Housing Development Commission
Mike Parson Governor From: Rick Laughrey Mike Kehoe Homeownership Manager Lieutenant Governor Chairman Re: Request for approval of additional authority for the Scott Fitzpatrick Mortgage Credit Certificate (MCC) Program State Treasurer Eric Schmitt Attorney General The MCC Program provides a federal tax credit to first-time homeowners who obtain a Tracey S.C. Lewis market rate loan. A Mortgage Credit Certificate reduces the first-time homeowner’s Vice Chairman cost of borrowing through use of a federal tax credit for a portion of the mortgage Mark Elliff interest paid during a tax year. Since established in 2014, MHDC’s MCC Program has Secretary-Treasurer assisted 481 first-time homebuyers. The MCC Program authority is set to expire at the Rick McDowell Commissioner end of this year. Garrick Hamilton Commissioner The MCC Program provides assistance to first-time homebuyers who may have their own funds for down payment but can realize a significant savings on taxes based on Danny P. Chadakhtzian Commissioner their tax liability. The MCC Program, in addition to the mortgage revenue bond- financed First Place Program and the Next Step Program, furthers MHDC’s housing Stephen J. Parshall mission and provides an additional tool to support the housing economy in Missouri. Commissioner Attached is Resolution 1066, which authorizes the establishment of the Qualified Mortgage Credit Certificate Program through one or more elections not to exceed
Kip Stetzler $100 million. This election will utilize carry forward private activity bond cap and Executive Director will be available to use for MCCs through the calendar year of 2023.
Kansas City Recommendation: 920 Main, Suite 1400 Kansas City, MO 64105 Staff requests approval of Resolution No. 1066 authorizing the establishment of the 816-759-6600 Fax 816-301-7000 Qualified Mortgage Credit Certificate Program through one or more elections not to
exceed $100 million. St. Louis 505 N. 7th Street 20th Floor, Suite 2000 St. Louis, MO 63101 www.mhdc.com RESOLUTION NO. 1066
A RESOLUTION AUTHORIZING AND PROVIDING FOR ESTABLISHMENT OF ONE OR MORE QUALIFIED MORTGAGE CREDIT CERTIFICATE PROGRAMS; APPROVING AND AUTHORIZING THE EXECUTION AND DELIVERY OF ONE OR MORE ELECTIONS NOT TO ISSUE QUALIFIED MORTGAGE BONDS IN A MAXIMUM AGGREGATE PRINCIPAL AMOUNT OF $100,000,000, A NOTICE OF MORTGAGE CREDIT CERTIFICATE PROGRAMS, OPERATIONS MANUAL, PARTICIPATION AGREEMENT, COMPLIANCE CERTIFICATES AND OTHER DOCUMENTS RELATED THERETO AND IN CONNECTION THEREWITH; AND AUTHORIZING THE OFFICERS, EMPLOYEES AND REPRESENTATIVES OF THE MISSOURI HOUSING DEVELOPMENT COMMISSION TO DO AND PERFORM ALL THINGS NECESSARY, APPROPRIATE AND INCIDENTAL THERETO UNDER THE AUTHORITY OF CHAPTER 215, REVISED STATUTES OF MISSOURI, AND APPENDIX B(1) THERETO, AS AMENDED.
WHEREAS, the Missouri Housing Development Commission (the "Commission") is a governmental instrumentality of the State of Missouri (the "State"); and
WHEREAS, the Commission has received multiple allocations of the state ceiling of private activity bonds pursuant to Section 108.510, Revised Statutes of Missouri, as amended, for the purpose of issuing qualified mortgage bonds or qualified mortgage credit certificates, including allocations which were the subject of Carryforward Elections pursuant to Section 146(f) of the Internal Revenue Code of 1986, as amended (the "Code"); and
WHEREAS, the Commission has determined that it is desirable for the Commission to elect not to issue qualified mortgage bonds in a maximum aggregate principal amount not to exceed $100,000,000, and, in lieu thereof, to establish one or more Qualified Mortgage Credit Certificate Programs in accordance with Section 25 of the Code in order to provide for home ownership by persons and families of low and moderate income residing within the State.
NOW, THEREFORE, IT IS HEREBY RESOLVED BY THE MISSOURI HOUSING DEVELOPMENT COMMISSION AS FOLLOWS:
Section 1. Definitions. All words and phrases not otherwise defined herein shall have the respective meanings set forth in the Operations Manual hereinafter authorized and approved unless a different meaning clearly appears in context.
Section 2. Declaration of Purposes. It is hereby declared and determined that the purpose of this Resolution is to provide a means of reducing the costs of financing the acquisition and purchase of single family residential property to provide adequate, safe and sanitary housing which persons and families of low and moderate income can afford.
Section 3. Authorization of the Programs. There are hereby authorized to be created, established and implemented one or more Qualified Mortgage Credit Certificate Programs (the "Programs") pursuant to Section 25 of the Code and the regulations promulgated thereunder (collectively, the "Federal Mortgage Credit Certificate Act") to encourage and assist in financing the acquisition of decent, safe and sanitary residential housing facilities for low and moderate income persons and families residing within the State. The Programs shall be implemented, administered and created in accordance with this Resolution, the Federal Mortgage Credit Certificate Act and the Operations Manual hereinafter authorized. Section 4. Authorization of Elections Not to Issue Qualified Mortgage Bonds. For the purpose of providing for establishment of the Programs, the Chairman of the Commission (the "Chairman"), the Executive Director, Director of Operations, Director of Finance or Fiscal & Accounting Manager are hereby authorized to execute one or more Mortgage Credit Certificate Elections (the "Elections") in a maximum non-issued bond amount not to exceed $100,000,000, substantially in the form attached hereto as Exhibit A with such changes or amendments thereto as the officer executing an Election shall approve, such officer's execution thereof being conclusive evidence of such approval, and to file each such Election with the Internal Revenue Service at the time and in the manner specified in the Federal Mortgage Credit Certificate Act.
Section 5. Approval of Notice of Mortgage Credit Certificate Program, Operations Manual, Participation Agreement and Compliance Certificates. The Chairman, Executive Director, Director of Operations, Director of Finance or Fiscal & Accounting Manager are hereby authorized to execute and deliver, for and on behalf of the Commission, the Notice of Mortgage Credit Certificate Program (the "Notice"), the Operations Manual for the Programs (the "Operations Manual"), the Participation Agreement among the Commission and the participating Mortgage Lenders that are signatories thereto (the "Agreement") and the Compliance Certificate of the Commission relating to each Program (collectively, the "Certificates") in substantially the forms presented at this meeting, with any changes therein as the Chairman, Executive Director, Director of Operations, Director of Finance or Fiscal & Accounting Manager shall approve, such officer's execution thereof being conclusive evidence of such approval. The Director of Finance is hereby further directed to publish the Notice in such newspapers of general circulation in the State as required by the Federal Mortgage Credit Certificate Act.
Section 6. Further Authority. The Chairman, Executive Director, Director of Operations, Director of Finance or Fiscal & Accounting Manager are hereby further authorized and directed to execute any and all documents and agreements necessary or convenient for implementation of the Programs, including operations manuals and related agreements with respect to the procedures for review of applications for Mortgage Credit Certificates and the collection and disbursements of fees collected from homebuyers to administer the Programs. The Chairman, Executive Director, Director of Operations, Director of Finance, Fiscal & Accounting Manager, and other officers of the Commission, its attorneys and other agents, consultants or employees are hereby authorized and directed to do and perform all acts and things required of them by the provisions of this Resolution, the Elections, the Notice, the Operations Manual, the Agreement and the Certificates, necessary or incidental for the purpose of implementing and carrying out the Programs, and for the full, punctual and complete performance of all of the terms, covenants, provisions and agreements set forth therein.
Section 7. Authority. This Resolution is adopted under the authority of Chapter 215, Revised Statutes of Missouri, and Appendix B(1) thereto, as amended, and the Federal Mortgage Credit Certificate Act.
Section 8. Severability. If any section, paragraph, clause or provision of this Resolution shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such section, paragraph, clause or provision shall not affect any remaining provisions of this Resolution.
Section 9. Effective Date. This Resolution shall be in full force and effect from and after its adoption by the Commission.
-2- PASSED BY THE MISSOURI HOUSING DEVELOPMENT COMMISSION THIS 22ND DAY OF JUNE, 2021.
MISSOURI HOUSING DEVELOPMENT COMMISSION
By: Chairman
ATTEST:
Assistant Secretary
MHDC MCC Resolution S-1 EXHIBIT A
MORTGAGE CREDIT CERTIFICATE ELECTION
In accordance with Section 25(c)(2)(A) of the Internal Revenue Code of 1986, as amended (the "Code") and, to the extent applicable, Temporary Regs. Section 1.25-4T(c), the Missouri Housing Development Commission (the "Issuer") hereby elects not to issue an amount of qualified mortgage bonds that it may otherwise issue during the calendar year 2021. This election is made to enable the Issuer to distribute mortgage credit certificates in accordance with Section 25 of the Code and the regulations thereunder.
1. Name, Address and TIN of Issuer:
Missouri Housing Development Commission 920 Main Street, Suite 1400 Kansas City, Missouri 64105 TIN: 43-0979983
2. Issuer's Applicable Limit as Determined Under Section 146 and Regulations Sec. 1.25- 4T(c)(5):
Pursuant to Section 146 of the Code, the State of Missouri allocated to the Issuer the amount of $577,641,235.01 for the purposes of issuing qualified mortgage bonds and mortgage credit certificates for calendar year 2018, which was the subject of a carryforward election. See attached allocation letter and carryforward election from the Director of the Missouri Department of Economic Development (Appendix A). The calendar year 2018 carryforward election is available for the issuance of qualified mortgage bonds or an election to issue mortgage credit certificates made on or before December 31, 2021. See attached Certificate of the Director of Business and Community Solutions of the Missouri Department of Economic Development certifying that the issue meets the requirements of Section 146 of the Code and the applicable regulations thereunder (Appendix B).
3. Aggregate Amount of Qualified Mortgage Bonds Issued by Issuer During Calendar Year 2021:
$[_78,082,200_] [Issued in Calendar Year 2021 pursuant to Calendar Year 2018 Carryforward Election described in 2 above].
4. Amount of Issuer's Applicable Limit that it has Surrendered to Other Issuers during Calendar Year 2021:
None.
5. Date and Amount of any Previous Elections not to issue Qualified Mortgage Bonds for Calendar Year 2021:
None.
-2- 6. Amount of Qualified Mortgage Bonds that the Issuer Elects not to Issue:
The Issuer hereby elects not to issue $100,000,000 principal amount of qualified mortgage bonds that it is otherwise authorized to issue for calendar year 2021.
Dated: , 2021
MISSOURI HOUSING DEVELOPMENT COMMISSION
By: Name: Marilyn Lappin Title: Director of Finance
-3- APPENDIX A
ALLOCATION LETTER AND CARRYFORWARD ELECTION
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APPENDIX B
CERTIFICATE OF DIRECTOR OF BUSINESS AND COMMUNITY SOLUTIONS OF MISSOURI DEPARTMENT OF ECONOMIC DEVELOPMENT
-5- CERTIFICATE
The undersigned Director of Business and Community Solutions of the Missouri Department of Economic Development hereby certifies, based on information provided to me by the Missouri Housing Development Commission, that the election by the Missouri Housing Development Commission not to issue $100,000,000 of private activity bonds which it is otherwise authorized to issue for calendar year 2021, and any subsequent issuance of mortgage credit certificates in lieu thereof, meets the requirements of Section 146 of the Internal Revenue Code of 1986, as amended, and the applicable regulations thereunder.
Dated: ______, 2021
By: ______Michael B. Lanahan, Director Business and Community Solutions Missouri Department of Economic Development 4) Report of Staff f. AHAP Production Applications
June 22, 2021 Mike Parson Governor TO: Commissioners Mike Kehoe Missouri Housing Development Commission Lieutenant Governor Chairman FROM: Gus Metz Scott Fitzpatrick Director of Rental Production State Treasurer
Eric Schmitt SUBJECT: 2021 Affordable Housing Assistance Program Production Credit Attorney General Application Funding Recommendations Tracey S.C. Lewis Vice Chairman Mark Elliff The Affordable Housing Assistance Program (AHAP) credit is governed by Missouri Secretary-Treasurer revised statues 32.105, 32.111, 32.112, 32.115, 32.120 and 32.125. The AHAP Rick McDowell Production credit is used as an incentive for Missouri businesses and/or individuals to Commissioner participate in affordable housing production. The credit is earned by an eligible donor Garrick Hamilton making a donation for this purpose to a qualified non-profit with an allocation of AHAP Commissioner credits. The donor is issued a tax credit equal to 55% of their qualified donation. Danny P. Chadakhtzian Commissioner Staff has completed the evaluation of 12 AHAP Production applications submitted in Stephen J. Parshall response to our 2021 AHAP Notice of Funding Availability (NOFA). Commissioner
Funding recommendations were based on the past performance of the non-profit agency, ability to secure donations, program guidelines and composition of proposals.
Kip Stetzler Executive Director The applications which are being recommended for approval are shown on the spreadsheet following this memorandum.
Kansas City 920 Main, Suite 1400 Based on staff’s review and analysis of the applications, staff recommends and Kansas City, MO 64105 requests approval of the proposals on the attached spreadsheet titled “2021 – 816-759-6600 Fax 816-301-7000 Recommended AHAP Production Applications.”
St. Louis 505 N. 7th Street 20th Floor, Suite 2000 St. Louis, MO 63101 www.mhdc.com
2021 - Recommended AHAP Production Applications
AHAP Credits Project # Non-Profit Name Agency City Purpose Recommended
New construction of a single family home for a veteran 21-008 Truman Heritage Habitat for Humanity Independence family. $ 55,000.00
New construction of a building to house victims of 21-009 Community Treatment, Inc. Festus domestic violence. $ 50,000.00
Funds will be used to acquire Harmony Village a 48- 21-010 St. Patrick Center St. Louis unit apartment community. $ 121,000.00
New construction of housing for homeless pregnant 21-011 Catholic Charities of Southern Missouri, Inc. Springfield women and their children. $ 2,000,000.00
21-012 Habitat for Humanity of St. Charles County St. Peter's New construction of three single family homes. $ 45,000.00 Renovation of a home to create housing for two 21-013 Drumm Center for Children Independence families with foster children. $ 126,500.00 Installation of a generator to protect against power 21-014 Phoenix Programs, Inc. Columbia outages for their drug treatment center. $ 11,831.00
Funds will be used to build an Intake Center for 21-015 Newhouse Inc. Kansas City domestic violence survivors. $ 112,750.00 Funds will be used as additional funds for affordable 21-016 Interfaith Residence (dba DOORWAYS) St. Louis housing at Doorways 2.0. $ 250,000.00
Funds will be used to construct a walkway connecting 21-017 Community Housing Management Corp St. Louis Covenant Place III residents to service areas. $ 110,000.00 Renovation of the historic St. Luke's Hospital to create 21-018 Urban Strategies, Inc. St. Louis affordable residential housing. $ 2,000,000.00
21-019 St. Louis Art Place Initiative Inc. St. Louis New construction of 21 Habitat for Humanity homes. $ 495,000.00 4) Report of Staff g. ESG NOFA and Allocation Plan
Emergency Solutions Grant Program Notice of Funding Availability (NOFA)
Purpose: The Missouri Housing Development Commission (MHDC), in collaboration with the Missouri Department of Social Services (DSS), hereby notifies interested organizations of the availability of Emergency Solutions Grant (ESG) funds to provide housing assistance to homeless or nearly homeless Missourians in an anticipated amount up to $2,784,683.00 subject to any upward adjustments in available funds. The funds will be allocated in a competitive process in accordance with the Allocation Plan. The allocation of FY2021 funds will be awarded for program year 2022 pending an executed ESG contract from DSS, if any.
Deadline: Applications for funding will be accepted by MHDC in the Kansas City office until 11:59 p.m. on Thursday, July 29, 2021. All applications received after the deadline will not be considered for funding. The anticipated funding period for program year 2022 will run November 1, 2021 to October 31, 2022. MHDC may, at its discretion, adjust the funding period in order to meet the increased needs of the COVID-19 Virus Pandemic or other circumstances as may be needed.
Requirements: Applicants must be a city/county or non-profit entity with capacity to administer the funds directly, eligible to conduct business in Missouri, be an entity in good standing with the state of Missouri and provide housing or housing services. Funding will not be awarded to individuals. Funding may not be sub-granted. All applications must be in compliance with the 2022 Application Guidance and submitted online in the Grant Interface software (https://www.grantinterface.com/Home/Logon?urlkey=mhdc). The 2022 Application Guidance should be reviewed before completing and submitting a proposal. The 2022 Application Guidance and Grant Interface logon instructions can be found on the MHDC website. Applications must comply with the following restrictions on funding requests: o Cities/Counties are eligible to apply for up to $50,000; o Direct non-profits are eligible to apply for up to $50,000 per grant application; o Direct non-profits that serve multiple counties within a Continuum of Care may apply for up to $50,000 per county up to $100,000.
Submission: Please submit an application through Grant Interface (https://www.grantinterface.com/Home/Logon?urlkey=mhdc).
Contact Information: If there are any questions, please contact: Cassie Sipos-Haas, ESG Administrator Phone: (816) 759-6630 Email: [email protected]
Effective Date: June 22, 2021
Emergency Solutions Grant Program 2022 Allocation Plan
General Information:
The Missouri Housing Development Commission (MHDC) is responsible for administering the Missouri State Allocation of the Department of Housing and Urban Development (HUD) Emergency Solutions Grant (ESG) Program funds granted to MHDC by the Missouri Department of Social Services (DSS).
These funds are provided through a federal grant from the HUD under the ESG program, as amended by the Homeless Emergency Assistance and Rapid Transition to Housing Act of 2009 (HEARTH Act), the Missouri Department of Social Services under the Temporary Assistance for Needy Families (TANF) Program, and from other funding sources as they become available.
FY2021 Funds Available:
The Missouri Housing Development Commission, in conjunction with the Missouri Department of Social Services will make an anticipated amount of up to $2,784,683.00 subject to any upward adjustments in available funds, to Missouri applicants for program year 2022 distributed geographically according to this Allocation Plan.
Grant Priorities
The purpose of the Emergency Solutions Grant Program is to support programs within Missouri communities that prevent homelessness and rapidly return households who experience homelessness to stable housing. These funds should be targeted and coordinated with other homeless services in the Continuum of Care. HUD regulation states that no more than 60 percent of the allocation can be spent on Emergency Shelter and Street Outreach activities. The eligible activities for which funding is available are as follows:
1. Rapid Re-Housing: to assist individuals and families who are “literally homeless” under the HUD definition of homelessness to transition quickly into permanent housing and to achieve housing stability through financial assistance and services. 2. Street Outreach: to provide essential services such as case management and engagement for unsheltered homeless individuals and families. 3. Emergency Shelter: to provide essential services for shelter participants or for shelter operations. 4. Homelessness Prevention: to assist individuals and families who are imminently homeless under the HUD definition of homelessness to prevent homelessness and to regain stability in their current housing or other permanent housing through financial assistance and services. 5: Other uses approved by HUD, if any.
*Administration and HMIS activities are also allowable activities
Effective Date: June 22, 2021
1
Geographic Allocation
MHDC will endeavor to award funding in each geographic area as identified below, subject to the quality of the applications received and the applicant’s ability to meet eligibility criteria. In the event that insufficient applications are received within a geographic area, any remaining funds will be allocated to other regions. Any funds recaptured will be reallocated at the discretion of MHDC and such reallocated funds shall not be subject to these geographic allocations, though MHDC shall use reasonable best efforts to ensure an equitable distribution throughout the State.
Missouri Continua of Care Distribution Percentage Missouri Balance of State 52.75% Joplin 8.50% Kansas City/Independence/Lee’s Summit/Jackson County 5.50% Springfield 7.50% St. Charles 7.00% St. Joseph 7.75% St. Louis City 5.50% St. Louis County 5.50% Total Amount to be Funded by Geographic Allocation $2,784,683.00
ESG funds are geographically allocated by Missouri Continuum of Care (CoC) in an effort to coordinate homeless assistance funds with the needs of each CoC.
Effective Date: June 22, 2021
2
4) Report of Staff h. 4% TE Bond Second Round Recommended Applications
June 2212021 Strc?gth, Agnity'. Qudlity oJ UJi MISSOURI HOUSING DEVEI-oPMENT CoMMISSIoN TO: Commissioners Missouri Housing Development Commission Mike Parson Governor F'ROM: Gus Metz Mike Kehoe Director of Rental Production Lieutenant Governor
Scott Fitzpatrick SUBJECT: Rental Production Recommendations for Funding: 2020 Round State Treasurer Two 4"/" Low Income Housing Tax Credits Eric Schmitt Attorney General Staffhas completed the evaluation of eleven (1 l) applications submitted in response to Mark Elliff our 2020 Round Two 4%o Low Income Housing Tax Credit NOFA for allocation of Commissioner federal and state 4%o credits. Rick McDowell Commissioner In reviewing these applications, we applied the criteria stated in the 2020 Qualified Allocation Plan (QAP) and held a virtual public hearing via webinar. None of the three Garrick Hamilton Commissioner proposals being recommended today received negative comments.
Tracey S.C. Lewis The three properties being recommended for approval are shown on the spreadsheet Commissioner following this memorandum. We have also attached a salient fact sheet for each Danny P. Chadakhtzian property summarizingthe salient facts associated with that development. Commissioner Stephen J. Parshall Based on stafPs review and analysis of the applications received, staff Commissioner recommends and requests approval of the proposals included on the attached spreadsheet titled "Recommended - 2020 Round Two 4o/o Low Income Housing Tax Credits."
Kip Stetzler Executive Director
Kansas City 920 Main, Suite 1400 Kansas City, MO 54105 816-7s9-6600 Fax 8L6-301-7000
St. Louis 505 N. 7th Street 20th Floor, Suite 2000 St. Louis, MO 53101 www.mhdc.com Recommended - 2020 Round Two 4% Low Income Housing Tax Credits
New Set-Aside preference / Tax Exempt Rehab Senior / Service Enriched / Federal 4% State 4% Tax Bond - Fund Project # Units Conv Family Veteran's Services Development Name Developer City Tax Credits Credits Const. HOME Balance
New 20-432 39 Const. Family Yes Crescendo Brinshore Development, LLC Kansas City $ 475,000 $ 475,000 $ 6,640,000 $ 800,000 $ 1,300,000
Senior 20-434 57 Rehab 55+ Yes Chilton Place Community Housing Ministry, Inc. St. Joseph $ 300,046 $ 300,000 $ 4,700,000 $ 650,000 $ 1,700,000
Northwoods Terrace 20-435 128 Rehab Family Yes Apartments * Community Housing Ministry, Inc. St. Joseph $ 347,958 $ 275,000 $ 8,200,000 $ - $ - * Recommended for MHDC-issued bonds with Risk Share Insurance Salient Facts:
Region Kansas City MHDC Property Number 20-432 Property Name Crescendo Developer Name Brinshore Development, LLC Location Kansas City Occupancy Family Construction New Construction Priority (if applicable) Non-Profit, Service Enriched Property Type Single Family Two Story Row Building with Elevator Duplexes Single Story Row Building without Elevator Description of Property: 39 - 1, 2 and 3 bedroom apartments and townhouses for families in nine 4-plex buildings. Development will also include a community center that will include 3 units as well as a meeting room, computer workstations, kitchenette and community workspace. Reasons for Recommendations: 1. 17 of the units will serve tenants at 30%, 40% AMI and 50% AMI. 2. Service enriched development for families with children. 3. Development near one of the best public schools in Missouri. 4. First residential phase of Urban Neighborhood Initiative's Purpose Built Community.
Loan Information
Permanent Sources Construction Sources MHDC Fund Balance $1,300,000 MHDC HOME $800,000 MHDC HOME $800,000 Tax Credit Equity $1,481,915 Construction Loan $6,640,000 Federal LIHTC Equity $7,409,573 Costs/Fees Post Construction $720,500 Federal and State Historic $0 Total Construction Sources $9,642,414 AHAP Donation $0 Deferred Developer Fee $132,742 Total Sources: $9,642,414
Uses: Construction Costs $7,370,000 Architect and Engineering $197,500 Construction Interest $144,054 Contingency $368,500 Closing Legal $45,000 Environmental Abatement $0 Relocation Expense $0 Furniture and Fixtures $30,000 Acquisition Costs $130,000 Developer\Construction Fee $720,000 MHDC and Related Costs $27,250 Reserves $205,500 Other Development Costs $404,610 Total Uses: $9,642,414 w/o Reserves & Total Reserves MHDC Fees MHDC Fees Development Costs $9,642,414 $205,500 $27,250 $9,409,664 Costs per Unit $247,241 $5,269 $699 $241,273 Property Data:
Breakdown by Unit Type Type # of Units Sq Ft Net Rent Market % of Market 1 Bed 10 590 - 830 $355 - $775 $900 39% - 86% 2 Bed 10 866 - 920 $410 - $950 $1,050 39% - 90% 3 Bed 19 1253 - 1665 $455 - $1120 $1,200 38% - 93%
Total Number of Units 39 Total LIHTC Units 39 Total Market Units 0
Income and Expense Data Total Per Unit Gross Income $324,460 $8,319 Underwritten Expenses $232,902 $5,972 Operating Income $91,558 $2,348 Debt Service $65,770 $1,686 Net Operating Income $25,788 $661
Year 1 Year 15 Debt Service Coverage 1.39 1.15
Tax Credit Information Amount Price Per Credit Per LIHTC Unit Per Unit (All) Federal Low Income $475,000 $0.90 $12,179 $12,179 State Low Income $475,000 $0.66 $12,179 $12,179 Federal Historic $0 $0.00 $0 $0 State Historic $0 $0.00 $0 $0 Salient Facts:
Region Rural Region MHDC Property Number 20-434 Property Name Chilton Place Developer Name Community Housing Ministry, Inc Location St. Joseph Occupancy Senior 55+ Construction Acquisition/Rehab Priority (if applicable) Non-Profit, Service Enriched,Preservation Property Type Single Family Two Story Row Building with Elevator Duplexes Single Story Row Building without Elevator Description of Property: Rehabilitation of a 57-unit senior development located in the Downtown area of St. Joseph, MO. Built in 1983, there are 17 studio and 40 one bedroom apartments.
Reasons for Recommendations: 1. Preservation project of 57 units with strong need of rehabilitation and accessibility compliance measures. 2. Senior tenants only pay up to 30% of their income for rent. 3. Service enriched development for seniors 55+.
Loan Information
Permanent Sources Construction Sources MHDC Fund Balance $1,700,000 MHDC $650,000 MHDC HOME $650,000 Tax Credit Equity $881,977 Construction Period Income $30,000 Construction Period Income $30,000 Exisiting Reserves $80,000 Existing Reserves $80,000 Sterling Bank $4,700,000 Federal LIHTC Equity $4,409,884 Costs/Fees Post Construction $629,369 Federal and State Historic $0 Total Construction Sources $6,971,346 AHAP Donation $0 Deferred Developer Fee $101,462 Total Sources: $6,971,346
Uses: Construction Costs $2,622,000 Architect and Engineering $144,210 Construction Interest $122,553 Contingency $258,540 Closing Legal $25,000 Environmental Abatement $0 Relocation Expense $68,400 Furniture and Fixtures $30,000 Acquisition Costs $2,345,000 Developer\Construction Fee $707,000 MHDC and Related Costs $32,500 Reserves $210,200 Other Development Costs $405,943 Total Uses: $6,971,346 w/o Reserves & Total Reserves MHDC Fees MHDC Fees Development Costs $6,971,346 $210,200 $32,500 $6,728,646 Costs per Unit $122,304 $3,688 $570 $118,046 Property Data:
Breakdown by Unit Type Type # of Units Sq Ft Net Rent Market % of Market Efficiency 17 432 $535 $535 100% 1 Bed 40 573 $599 $599 100%
Total Number of Units 57 Total LIHTC Units 57 Total Market Units 0
Income and Expense Data Total Per Unit Gross Income $376,827 $6,611 Underwritten Expenses $249,304 $4,374 Operating Income $127,523 $2,237 Debt Service $86,007 $1,509 Net Operating Income $41,516 $728
Year 1 Year 15 Debt Service Coverage 1.48 1.40
Tax Credit Information Amount Price Per Credit Per LIHTC Unit Per Unit (All) Federal Low Income $300,046 $0.85 $5,264 $5,264 State Low Income $300,000 $0.62 $5,263 $5,263 Federal Historic $0 $0.00 $0 $0 State Historic $0 $0.00 $0 $0 Salient Facts:
Region Rural Region MHDC Property Number 20-435 Property Name Northwood Terrace Apartments Developer Name Community Housing Ministry, Inc. Location St. Joseph Occupancy Family Construction Rehabilitation Priority (if applicable) Non-Profit, Service Enriched, Preservation Property Type Single Family Two Story Row Building with Elevator Duplexes Single Story Row Building without Elevator Description of Property: Rehabilitation of 128 units in 16 2-story buildings built in 1970. There are 28 one bedroom, 62 two bedroom and 20 three bedroom units. Amenities include computer room and community meeting room.
Reasons for Recommendations: 1. Preservation development with strong need of rehabilitation and accessibility compliance measures. 2. Service enriched development for families and children. 3. Family tenants only pay up to 30% of their income for rent.
Loan Information
Permanent Sources Construction Sources MHDC Select Risk Share $4,600,000 MHDC Risk Share $8,200,000 MHDC Select Re-Amortization HOME Loan $1,716,000 Tax Credit Equity $932,470 Existing Reserve Balance $321,864 Assumed MHDC Loan $1,716,000 Income From Operations $250,000 Existing Reserve $321,864 GP Contribution $110 Income from Operations $250,000 Costs/Fees Post Construction $232,433 Federal LIHTC Equity $4,662,349 Total Construction Sources $11,652,767 Federal and State Historic $0 $1,126,405 AHAP Donation $0 $10,738,313 Deferred Developer Fee $102,444 Total Sources: $11,652,767
Uses: Construction Costs $5,248,000 Architect and Engineering $211,400 Construction Interest $256,250 Contingency $367,360 Closing Legal $25,000 Environmental Abatement $0 Relocation Expense $153,600 Furniture and Fixtures $0 Acquisition Costs $3,210,000 Developer\Construction Fee $959,000 MHDC and Related Costs $84,000 Reserves $536,800 Other Development Costs $601,357 Total Uses: $11,652,767 w/o Reserves & Total Reserves MHDC Fees MHDC Fees Development Costs $11,652,767 $536,800 $84,000 $11,031,967 Costs per Unit $91,037 $4,194 $656 $86,187 Property Data:
Breakdown by Unit Type Type # of Units Sq Ft Net Rent Market % of Market 1 Bed 32 560 $380 - $675 $675 56% - 100% 2 Bed 72 620 $440 - $750 $750 59% - 100% 3 Bed 24 825 $485 - $850 $850 57% - 100%
Total Number of Units 128 Total LIHTC Units 110 Total Market Units 18
Income and Expense Data Total Per Unit Gross Income $921,704 $7,201 Underwritten Expenses $617,037 $4,821 Operating Income $304,667 $2,380 Debt Service $255,640 $1,997 Net Operating Income $49,028 $383
Year 1 Year 15 Debt Service Coverage 1.19 1.11
Tax Credit Information Amount Price Per Credit Per LIHTC Unit Per Unit (All) Federal Low Income $347,958 $0.85 $3,163 $2,718 State Low Income $275,000 $0.62 $2,500 $2,148 Federal Historic $0 $0.00 $0 $0 State Historic $0 $0.00 $0 $0 4) Report of Staff i. Five Year Strategic Plan Update
Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri
Prepared for Missouri Housing Development Commission
Prepared by Community Analytics, LLC Kansas City, MO 64131 Email: [email protected]
April 2021
TABLE OF CONTENTS
Executive Summary 4 Strategic Plan Update Process 4 Strategic Priorities 4 QAP Alignment with the Strategic Plan 5 Multifamily Competitive Funding Results 2020 6 Using this Update 6
Introduction 8 Purpose of this Update 8 What is Affordable Housing? 8 Housing Cost Burden 9 Strategic Priorities 9 How this Update is Organized 10
QAP 2020 Alignment with the Strategic Plan 11
Multifamily Competitive Funding Results 2020 15
Stakeholder Meetings 18
Data Analysis 19 Severe Housing Cost Burden 19 Severe Housing Cost Burden Among Missouri Renter Households 19 Severe Housing Cost Burden Among ELI Renter Households 25 Affordable and Available ELI Units 28
Effective Implementation Support 31
Concl usi on 32
Appendix: Census Geographic Areas in Missouri 33
Li st of Tabl es
Table 1. Strategic Plan and QAP 2020 Linkages______11
Table 2. Developments and Units Funded by Income Category 2020 ______15
Table 3. Set-Aside Categories for Developments and Units Funded 2020 ______16
Table 4. Renter Households with Severe Cost Burden, 2019 ______19
Table 5. ELI Renter Households with Severe Cost Burden, 2019 ______26
Table 6. ELI Affordable and Available Unit Analysis ______28
Table 7. ELI Affordable and Available Analysis by MSA and Region ______29
Table 8. Census and Constructed MSAs Missouri ______33
List of Maps
Map 1. Renter Households With Severe Cost Burden as a percentage of All Renter Households, 2019 ...... 24
Map 2. Extremely Low Income Renter Households With Severe Cost Burden as a percentage of All Extremely Low Income Renter Households, 2019 ...... 27
EXECUTIVE SUMMARY
The Missouri Housing Development Commission (MHDC) contracted with Community Analytics, LLC, a Kansas City, Missouri-based consulting firm, to prepare this Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri. This Update will be used to inform MHDC’s activities directed at addressing affordable housing need throughout the State of Missouri.
STRATEGI C PLAN UPDATE PROCESS
The process used to prepare this Update included the analysis of linkages between MHDC’s Qualified Allocation Plan (QAP) 2020 and the Strategic Plan published in 2020, analysis of multifamily development allocations based on the QAP 2020 and Strategic Plan priorities, new stakeholder input, and data analysis. Stakeholder meetings were held virtually on February 25 and March 2, 2021. This multifaceted update process facilitated production of an Update that will be useful for MHDC and a wide array of stakeholders in addressing affordable housing need in Missouri.
STRATEGI C PRIORITIES
An important goal of this Update is determining how Missouri’s QAP 2020 and the results of the 2020 multifamily competitive funding allocations align with the Five-Year Strategic Plan for Affordable Housing for the State of Missouri released in mid-2020.1 The Strategic Plan includes five strategic priorities for affordable housing in the State of Missouri as shown below:
1 Five-Year Strategic Plan for Affordable Housing for the State of Missouri. Missouri Housing Development Commission, Kansas City, MO, May 2020. Available for download at http://mhdc.com/notices/2020- 0612%20Strategic%20Plan%20No%20Watermark.pdf.
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1. Missouri will consider engaging in increased production and preservation of rental units affordable to Extremely Low Income (ELI)2 households. 2. Missouri will consider increasing its focus on housing for special needs and vulnerable populations. 3. Missouri will consider revising its Qualified Allocation Plan (QAP) scoring criteria to facilitate more production and preservation of affordable housing units in rural areas. 4. Missouri will consider working to link affordable housing production with economic development activities that bring jobs to our state. 5. MHDC will consider engaging in effective implementation practices in support of achieving Missouri’s affordable housing strategic priorities.
QAP ALIGNMENT W I TH THE STRATEGI C PLAN
Scoring and other selection criteria contained in Missouri’s QAP 2020 were very well aligned with strategic plan priorities. This is an excellent outcome for affordable housing in Missouri, particularly given the challenges imposed on MHDC staff arising from the pandemic and the need to very quickly design the QAP once the Strategic Plan was published in mid-2020.
Highlights of how the QAP 2020 aligned with the Strategic Plan include:
• Reintroduction of the Missouri LIHTC • ELI unit selection criteria • Affordable housing preservation selection criteria • Increased funding (30% LIHTC basis boost) for affordable housing preservation • Special needs and vulnerable population housing selection criteria • Increased funding (30% LIHTC basis boost) for service-enriched and independence- enabling housing
2 Extremely Low Income (ELI) is a federal category indicating households with incomes at or below 30% of Area Median Income (AMI) as determined each year by the U.S. Department of Housing and Urban Development (HUD).
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• Increased funding (30% LIHTC basis boost) for veterans’ housing • Rural housing selection criteria • Affordable housing specifically linked with economic development selection criteria
Table 8 in the body of this document provides full details about the linkages between the QAP 2020 and the Strategic Plan.
M ULTIFAMILY COMPETITIVE FUNDI NG RESULTS 2020
The 2020 multifamily competitive round resulted in the award of funding to 36 developments with 2,233 total units. A large majority of developments (80.5%) included units with income restrictions set at the ELI level (30% AMI or below). A respectable proportion of developments (19.4%) included units affordable at the Very Low Income (VLI) level (50% AMI or below). Table 2 (available in the body of this Update) provides details of 2020-funded developments and units by income restrictions.
Further, 2020 competitive round results included developments addressing critical set-aside categories. These categories included special needs, vulnerable populations, service-enriched, and veterans housing. For instance, special needs housing made up nearly 42% of developments with 2020 allocations. Service-enriched housing is present in nearly 92% of developments funded in 2020. Table 3 (available in the body of this Update) provides details of developments and units funded in set-aside categories in 2020.
USI NG THI S UPDATE
This Update will provide MHDC with important information to be used in the preparation of the 2021 QAP. It also provides information useful for many MHDC stakeholders, including members of the real estate community, Missouri state agencies, local governments, nonprofit groups engaged in housing and community development work, advocates, and members of the public
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at large. More specifically, the analyses provided in this Update and stakeholder input gathered through the Update process will make it possible for all concerned with affordable housing in Missouri to easily review progress in addressing our State’s strategic priorities. In turn, this will facilitate the continuation of effective action in meeting affordable housing need.
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INTRODUCTION
PURPOSE OF THI S UPDATE
This Update to the Five-Year Affordable Housing Strategic Plan for the State of Missouri was prepared by Community Analytics, LLC, a Kansas City, Missouri-based consulting firm, under contract with the Missouri Housing Development Commission (MHDC). The purpose of this Update is to provide a basis for informed action in addressing the need for affordable housing throughout the State of Missouri with particular emphasis on addressing priorities identified in the Strategic Plan published in mid-2020.3
WHAT I S AFFORDABLE HOUSING ?
The term “affordable housing” has been in common use since the 1980s, yet it is seldom defined. Federal guidelines indicate that households can afford up to 30% of gross monthly income for housing costs. For renters, housing costs are calculated as rent plus utilities such as electric, gas, and water. For homeowners, housing costs are mortgage payment (principal, interest, homeowners’ insurance, property taxes, mortgage insurance premiums, and homeowner association fees, if any) plus utilities.4
3 Five-Year Strategic Plan for Affordable Housing for the State of Missouri. Missouri Housing Development Commission, Kansas City, MO, May 2020. Available for download at http://mhdc.com/notices/2020- 0612%20Strategic%20Plan%20No%20Watermark.pdf.
4 Williamson, Anne R. "Can They Afford the Rent? Resident Cost Burden in Low Income Housing Tax Credit Developments." Urban Affairs Review 47, no. 6 (2011): 775-99.
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HOUSI NG COST BURDEN
Households paying more than 30% of gross monthly income are considered cost burdened. Households paying more than 50% of gross monthly income are termed severely cost burdened.5 Housing is not affordable if the household is experiencing cost burden or severe cost burden. These categories are often used to analyze housing need within geographic boundaries such as local jurisdictions, states, or the nation.
STRATEGI C PRIORITIES
An important goal of this Update is determining how Missouri’s QAP 2020 and the results of the 2020 multifamily competitive funding allocations align with the Five-Year Strategic Plan for Affordable Housing for the State of Missouri released in mid-2020.6 The Strategic Plan includes five strategic priorities for affordable housing in the State of Missouri. These priorities are shown below:
1. Missouri will consider engaging in increased production and preservation of rental units affordable to Extremely Low Income (ELI)7 households. 2. Missouri will consider increasing its focus on housing for special needs and vulnerable populations. 3. Missouri will consider revising its Qualified Allocation Plan (QAP) scoring criteria to facilitate more production and preservation of affordable housing units in rural areas. 4. Missouri will consider working to link affordable housing production with economic development activities that bring jobs to our state.
5 Williamson, Anne R. ibid. 6 Five-Year Strategic Plan for Affordable Housing for the State of Missouri. Missouri Housing Development Commission, Kansas City, MO, May 2020. Available for download at http://mhdc.com/notices/2020- 0612%20Strategic%20Plan%20No%20Watermark.pdf. 7 Extremely Low Income (ELI) is a federal category indicating households with incomes at or below 30% of Area Median Income (AMI) as determined each year by the U.S. Department of Housing and Urban Development (HUD).
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5. MHDC will consider engaging in effective implementation practices in support of achieving Missouri’s affordable housing strategic priorities.
HOW THI S UPDATE I S ORGANIZED
The remaining sections of this Update are organized as follows:
• QAP 2020 Alignment with the Strategic Plan • Multifamily Competitive Funding Results 2020 • Stakeholder Meetings • Data Analysis
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QAP 2020 ALIGNMENT WITH THE STRATEGIC PLAN
Missouri’s QAP 2020 was very well aligned with the five priorities laid out in the Five-Year Strategic Plan for Affordable Housing for the State of Missouri. Table 1 provides details of the linkages between the Strategic Plan and the QAP 2020.
Table 1. Strategic Plan and QAP 2020 Linkages
Strategic Priority QAP
ELI Production and Preservation p. 2: Reintroduction of the State LIHTC and introduction of a pilot program for State LIHTC accelerated redemption supports financial feasibility of both ELI production and preservation, as well as other affordable housing
pp. 8-9: State-Designated DDAs for preservation
pp. 13-14: Units for special needs and vulnerable populations affordability at ELI level
pp. 16-17: Preservation boost in basis (up to 30%)
p. 22: Priority Group scoring for Preservation (45 points)
p. 23: Income Targeting points for ELI
p. 25: Preservation points
p. 26: Rental assistance points
p. 29: Development size exception for preservation
p. 30: Market Characteristics exception consideration exception for preservation
Special Needs and Vulnerable p. 2: Reintroduction of the State LIHTC and introduction of a Populations pilot program for State LIHTC accelerated redemption supports feasibility of special needs and vulnerable population housing, as well as other affordable housing
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p. 5: all developments with 12 or more units will have a minimum of 5% physically accessible units and 2% hearing/visually impaired accessible units (federal requirement); all new construction will have universal design, regardless of number of units; all rehab developments with special needs set-aside will meet federal accessibility requirements (5% physical/2% hearing/visual impairment) and universal design greater than or equal to special needs set- aside percentage; developments must provide facilities, amenities, and equipment appropriate for the population served
p. 9: State-Designated DDAs for special needs and vulnerable populations
pp. 13-14: Special needs and vulnerable populations set aside; units for special needs and vulnerable populations affordable at ELI level
p. 15: Service-Enriched Housing basis boost (up to 30%) is especially helpful in making special needs and vulnerable populations developments financially feasible, as well as housing for seniors and other groups
pp. 17-18: Independence-Enabling Housing basis boost (up to 30%)
p. 18: Veterans’ Housing basis boost (up to 30%)
p. 22: Priority Groups for Service Enriched Housing, Including Veterans and Special Needs, Vulnerable Populations, and Independence-Enabling Housing (45 points)
p. 24: Services points
p. 24: Special Needs/Vulnerable Population points
p. 28: Consideration given to development characteristics, including properties serving special needs/vulnerable population tenants
pp. 28-29: Development size exceptions for properties serving certain populations, including special needs and service- enriched housing
p. 30: Market Characteristics exception consideration for certain properties, including those serving special needs/vulnerable populations, independence-enhancing housing and/or service-enriched housing
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p. 31: Housing Needs/Market Characteristics consideration for housing for special needs/vulnerable populations
Rural Housing p. 2: Reintroduction of the State LIHTC and introduction of a pilot program for State LIHTC accelerated redemption supports feasibility of rural housing, as well as other affordable housing
p. 25: Rural under-served points
p. 26: Rental Assistance points (includes Rural Development properties)
p. 28: Proportional allocation of 9% credits to include MSA- rural and rural region properties
Affordable Housing Linked with p. 19: Encouraging development in Opportunity Zones Economic Development p. 23: Priority Groups for Opportunity Area and Opportunity Zone (45 points)
p. 24: Family properties in Opportunity Area points
p. 25: Economic Development (significant connection) points
p. 30: Market Characteristics consideration of exception for location in a community with new employment opportunities and proven need for workforce housing
Implementation Practices in Support of Review of 2020 competitive round results in the context of the Strategic Plan Strategic Plan; 2021 update of Strategic Plan
The QAP 2020 fully reflected the priorities of the Strategic Plan. Indeed, it is noteworthy how well the QAP reflected these priorities, given the short time frame available between the finalization of the Strategic Plan and the release of the QAP. Further, the 2020 QAP was also responsive to the COVID-19 pandemic.
The QAP used a balanced approach to encourage multifamily program applications consistent with the Strategic Plan priorities. For instance, priorities were often supported through both set-asides and scoring criteria. Further, priorities were supported through the availability of
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exceptions to development size and characteristics requirements. Exceptions were also available for developments addressing strategic priorities based on market characteristics and housing need. Overall, exceptions were used appropriately to support affordable housing opportunities consistent with the Strategic Plan.
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MULTIFAMILY COMPETITIVE FUNDING RESULTS 2020
The 2020 multifamily program competitive round resulted in the award of funding to 36 developments with 2,233 total units. The largest development had 204 units, while the smallest had 13. The median number of units per development was 53, while the arithmetical average was 62.
Table 2 presents data on the number of developments and units funded by income restriction category.
Table 2. Developments and Units Funded by Income Category 2020
Income Developments % Developments Units % Units Restrictions8 ELI 29 80.5% 271 12.1% VLI 7 19.4% 149 6.7% LI to 60% 34 94.4% 1,610 72.1% Other 23 63.9% 197 8.8%
A large majority (80.5%) of developments funded in 2020 included some units with rents affordable to ELI tenants. However, the number of units affordable to ELI households was a much smaller proportion of those funded, with 12.1% at that level.
A respectable proportion (19.4%) of developments funded in 2020 included VLI units. VLI units made up 6.7% of the total units funded.
Most developments (94.4%) funded in 2020 included 60% AMI units. These units made up 72.1% of all units funded.
8 No housing units with income restrictions at 40% AMI were funded in 2020.
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Units with income restrictions listed as “Other” were present in 63.9% of developments funded in 2020. They made up 8.8% of all units funded. Many of the units listed with “Other” income restrictions are market-rate units. Thus, this serves as evidence of significant progress in creating mixed-income housing opportunities in 2020.
Overall, MHDC has made progress in creating incentives for developers to produce units for ELI households. Some of this progress may be due to incentives and selection criteria for the production of housing opportunities for special needs and vulnerable populations.
Units at 60% AMI remain the choice of most developers and investors throughout the country, because it is financially challenging to offer units below 60% AMI. However, Missouri’s State LIHTC and QAP provide substantial assistance in making multifamily development feasible even if it targets incomes below 60% AMI, special needs and vulnerable populations, and/or rural locations.
Table 3 provides data for multifamily developments funded in 2020 based on set-aside categories.
Table 3. Set-Aside Categories for Developments and Units Funded 2020
Set-Aside Category Developments % Developments Units % Units Special Needs 15 41.7% 667 29.9% Vulnerable Population 1 2.8% 88 3.9% Service-Enriched 33 91.7% 2,138 95.7% Priority Veteran Population 1 2.8% 50 2.2%
The selection criteria for special needs and service-enriched priority developments were very effective for the 2020 funding cycle. Although only one development in each of the vulnerable population and veteran population categories were funded, these groups may be served in properties falling into other categories.
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Although the proportion of family to senior developments was not part of the Strategic Plan priorities, an analysis was performed on these categories to supplement the set-aside analysis. Family properties made up 52.8% (19) of the developments funded in 2020. Family units accounted for 52.1% (1,164) of all units funded in 2020.
Senior 55+ properties were 36.1% (13) of the developments funded in 2020, making up 27.6% of all units funded. Senior 62+ properties made up 11.1% (4) of the total number of developments funded and had 20.2% of all units funded.
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STAKEHOLDER MEETINGS
Two stakeholder meetings were held virtually on February 25 and March 2, 2021. Meetings were facilitated by Dr. Anne Williamson of Community Analytics, LLC. Meetings were designed to foster a dialogue about affordable housing in Missouri. MHDC representatives were present at each meeting.
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DATA ANALYSIS
This section provides an update of data presented in the Five-Year Strategic Plan for Affordable Housing for the State of Missouri. Data used in this Update were obtained from the U.S. Census Bureau’s American Community Survey’s 2019 five-year estimates (2015-2019), while data used in the Strategic Plan were based on the American Community Survey’s 2017 five-year estimates (2013-2017). Data are presented in tabular and map formats below.
SEVERE HOUSI NG COST BURDEN
Severe housing cost burden is a strong indicator of unmet affordable housing need, because these households have little left over for other life necessities such as food, transportation, child care, and health care once housing costs have been paid. Severely cost burdened households also face a higher likelihood that they will fall into homelessness due to lack of adequate financial resources.
SEVERE HOUSI NG COST BURDEN AMONG M I SSOURI RENTER HOUSEHOLDS
Table 4 provides information on severe housing cost burden among Missouri renters.
Table 4. Renter Households with Severe Cost Burden, 2019
[See table on following page.]
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Total Renter Renter Households w/ % of All Renter % of All County Households Households 50% or more CB Households Households [MISSOURI] 2,414,521 802,535 159,588 19.9% 6.6% Adair 9,258 3,697 912 24.7% 9.9% Andrew 6,763 1,357 146 10.8% 2.2% Atchison 2,562 776 86 11.1% 3.4% Audrain 9,286 2,926 356 12.2% 3.8% Barry 13,645 3,583 703 19.6% 5.2% Barton 4,895 1,465 288 19.7% 5.9% Bates 6,547 1,786 255 14.3% 3.9% Benton 7,872 1,446 319 22.1% 4.1% Bollinger 4,593 881 160 18.2% 3.5% Boone 70,619 31,350 8,259 26.3% 11.7% Buchanan 33,501 12,613 2,450 19.4% 7.3% Butler 16,390 5,951 1,017 17.1% 6.2% Caldwell 3,639 869 120 13.8% 3.3% Callaway 15,973 4,391 569 13.0% 3.6% Camden 16,031 3,093 548 17.7% 3.4% Cape Girardeau 29,594 10,365 2,227 21.5% 7.5% Carroll 3,503 902 77 8.5% 2.2% Carter 2,333 527 77 14.6% 3.3% Cass 39,770 9,345 1,675 17.9% 4.2% Cedar 5,842 1,711 287 16.8% 4.9% Chariton 2,686 584 102 17.5% 3.8% Christian 31,645 8,149 1,326 16.3% 4.2% Clark 2,657 668 72 10.8% 2.7% Clay 91,238 28,602 4,721 16.5% 5.2% Clinton 8,177 1,928 242 12.6% 3.0% Cole 30,154 10,164 1,411 13.9% 4.7% Cooper 6,397 1,755 227 12.9% 3.5% Crawford 9,578 2,736 520 19.0% 5.4% Dade 3,068 712 89 12.5% 2.9% Dallas 6,209 1,486 276 18.6% 4.4%
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Total Renter Renter Households w/ % of All Renter % of All County Households Households 50% or more CB Households Households Daviess 3,035 628 85 13.5% 2.8% DeKalb 3,807 1,176 213 18.1% 5.6% Dent 6,371 1,688 363 21.5% 5.7% Douglas 5,137 1,040 157 15.1% 3.1% Dunklin 12,342 4,685 1,018 21.7% 8.2% Franklin 40,943 10,436 1,653 15.8% 4.0% Gasconade 6,076 1,315 109 8.3% 1.8% Gentry 2,555 675 33 4.9% 1.3% Greene 125,201 55,029 12,451 22.6% 9.9% Grundy 3,936 1,250 141 11.3% 3.6% Harrison 3,429 936 82 8.8% 2.4% Henry 9,328 2,590 394 15.2% 4.2% Hickory 3,976 707 141 19.9% 3.5% Holt 2,022 481 46 9.6% 2.3% Howard 3,471 755 70 9.3% 2.0% Howell 15,878 5,017 987 19.7% 6.2% Iron 4,074 1,189 209 17.6% 5.1% Jackson 286,601 119,674 24,701 20.6% 8.6% Jasper 45,759 16,663 3,081 18.5% 6.7% Jefferson 84,444 17,425 3,012 17.3% 3.6% Johnson 19,864 7,750 1,537 19.8% 7.7% Knox 1,490 259 26 10.0% 1.7% Laclede 14,112 4,305 572 13.3% 4.1% Lafayette 13,050 3,812 673 17.7% 5.2% Lawrence 14,787 4,171 582 14.0% 3.9% Lewis 3,752 896 102 11.4% 2.7% Lincoln 19,286 4,149 1,005 24.2% 5.2% Linn 5,106 1,385 194 14.0% 3.8% Livingston 5,915 1,975 294 14.9% 5.0% Macon 5,845 1,483 172 11.6% 2.9% Madison 5,044 1,422 308 21.7% 6.1%
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Total Renter Renter Households w/ % of All Renter % of All County Households Households 50% or more CB Households Households Maries 3,762 945 179 18.9% 4.8% Marion 11,565 4,002 587 14.7% 5.1% McDonald 8,259 2,593 225 8.7% 2.7% Mercer 1,271 272 20 7.4% 1.6% Miller 10,111 2,605 285 10.9% 2.8% Mississippi 5,026 2,025 412 20.3% 8.2% Moniteau 5,436 1,249 155 12.4% 2.9% Monroe 3,702 943 94 10.0% 2.5% Montgomery 5,014 1,504 201 13.4% 4.0% Morgan 7,588 1,462 316 21.6% 4.2% New Madrid 7,371 2,694 466 17.3% 6.3% Newton 22,202 6,325 872 13.8% 3.9% Nodaway 8,395 3,541 693 19.6% 8.3% Oregon 4,249 1,112 241 21.7% 5.7% Osage 5,120 791 72 9.1% 1.4% Ozark 3,958 887 139 15.7% 3.5% Pemiscot 6,730 3,086 592 19.2% 8.8% Perry 7,576 1,894 212 11.2% 2.8% Pettis 16,033 5,004 933 18.6% 5.8% Phelps 17,981 7,256 1,687 23.2% 9.4% Pike 6,589 1,866 262 14.0% 4.0% Platte 39,305 13,400 2,065 15.4% 5.3% Polk 11,712 3,631 615 16.9% 5.3% Pulaski 15,154 7,682 1,277 16.6% 8.4% Putnam 1,744 398 69 17.3% 4.0% Ralls 4,036 676 153 22.6% 3.8% Randolph 8,626 2,458 641 26.1% 7.4% Ray 8,868 1,903 348 18.3% 3.9% Reynolds 2,596 553 64 11.6% 2.5% Ripley 5,059 1,063 187 17.6% 3.7% Saline 8,272 2,518 294 11.7% 3.6%
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Total Renter Renter Households w/ % of All Renter % of All County Households Households 50% or more CB Households Households Schuyler 1,475 453 46 10.2% 3.1% Scotland 1,768 397 56 14.1% 3.2% Scott 15,230 5,078 1,038 20.4% 6.8% Shannon 3,064 816 93 11.4% 3.0% Shelby 2,432 636 38 6.0% 1.6% St. Charles 146,631 28,409 4,528 15.9% 3.1% St. Clair 4,139 899 102 11.3% 2.5% St. Francois 24,898 7,855 1,529 19.5% 6.1% St. Louis City 141,952 79,977 20,301 25.4% 14.3% St. Louis 405,984 127,642 27,515 21.6% 6.8% Ste. Genevieve 7,121 1,418 310 21.9% 4.4% Stoddard 11,530 3,685 642 17.4% 5.6% Stone 12,783 2,334 326 14.0% 2.6% Sullivan 2,128 543 32 5.9% 1.5% Taney 22,272 8,532 1,490 17.5% 6.7% Texas 9,728 2,689 647 24.1% 6.7% Vernon 8,207 2,323 523 22.5% 6.4% Warren 12,654 2,674 669 25.0% 5.3% Washington 9,231 1,897 335 17.7% 3.6% Wayne 5,426 1,438 241 16.8% 4.4% Webster 13,575 3,393 455 13.4% 3.4% Worth 859 203 30 14.8% 3.5% Wright 7,063 2,122 358 16.9% 5.1%
Data source: Census ACS 2015-2019 5-Year Estimates
The five counties with the highest proportion of severely cost-burdened renter households (as a percent of all renter households) are Boone (26.3%), Randolph (26.1%), St. Louis City (25.4%), Warren (25.0%), and Adair (24.7%).
Map 1 illustrates the geographic distribution of severe housing cost burden among Missouri renters.
Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri - 2021 Page 23
Map 1. Renter Households With Severe Cost Burden as a percentage of All Renter Households, 2019
Data source: American Community Survey, 2015-2019 5-Year Estimates
Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri - 2021 Page 24
SEVERE HOUSI NG COST BURDEN AMONG ELI RENTER HOUSEHOLDS
Table 5 provides information on severe housing cost burden among ELI renters. This information is organized by Metropolitan Statistical Area (MSA) and non-MSA regions of the state due to certain geographic limitations in American Community Survey (ACS) income data that prevent the calculation of renter cost burden specific to ELI households at the county level.
As with other states, MSAs, and non-metropolitan areas throughout the country, the majority of ELI renters are severely cost burdened. Even the group of counties in Missouri with the smallest rate of ELI renters with severe cost burden—Lawrence, Henry, Vernon, Cedar, Barton, St. Clair, and Dade Counties—the figure is still relatively high (45.56%).
The highest proportion of severely cost burdened ELI renters is found in the Columbia MSA, with 73.35% of ELI renter households falling into this category. Seven areas have rates below Springfield but above 60% of ELI renter households: Springfield MSA (66.51%), Pettis, Randolph, Saline, Cooper, Howard, Carroll, and Chariton Counties (65.42%), St. Louis MSA (65.24%), Cape Girardeau MSA (64.94%), St. Francois, Washington, Perry and St. Genevieve Counties (64.94%), Phelps, Crawford, Dent, Gasconade, and Maries Counties (63.50%), and Kansas City MSA (61.63%).
Map 2 illustrates the geographic distribution of severe cost burden among Missouri’s ELI renter households.
Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri - 2021 Page 25
Table 5. ELI Renter Households with Severe Cost Burden, 2019
ELI All % All Renters Renters Renters Severe Severe Severe All ELI % ELI All % All Area CB CB CB Renters Renters Renters Renters Cape Girardeau, MO-IL (MSA) plus Scott (Sikeston, Micro) 2,523 3,287 76.76% 3,885 64.94% 15894 15.87%
Columbia, MO (MSA) 6,810 8,691 78.36% 9,284 73.35% 31597 21.55% Fayetteville-Springdale-Rogers, AR- MO (MSA) 1,146 2,395 47.85% 2,187 52.40% 17312 6.62%
Jefferson City, MO (MSA) 2,193 2,355 93.12% 4,642 47.24% 17703 12.39%
Joplin, MO (MSA) 2,773 4,058 68.33% 4,707 58.91% 22889 12.11% Kansas City, MO-KS (MSA) plus Johnston (Warrensburg, Micro) 24,865 34,927 71.19% 40,344 61.63% 188693 13.18%
St. Joseph, MO-KS (MSA) 1,600 2,446 65.41% 3,098 51.65% 14834 10.79% St. Louis, MO-IL (MSA) plus Audrain, Montgomery, & Pike 45,014 57,475 78.32% 68,996 65.24% 277053 16.25% Springfield, MO (MSA) plus Benton, Hickory, Laclede 10,990 15,910 69.08% 16,524 66.51% 79355 13.85%
Northwest Missouri 1,208 1,708 70.73% 2,434 49.63% 12466 9.69%
Northeast Missouri 1,764 2,214 79.67% 3,726 47.34% 14133 12.48% Pettis, Randolph, Saline, Cooper, Howard, Carroll & Chariton Counties 1,831 2,656 68.94% 2,799 65.42% 13717 13.35% Lawrence, Henry, Vernon, Cedar, Barton, St. Clair & Dade Counties 1,319 1,980 66.62% 2,895 45.56% 13830 9.54% Pulaski, Camden, Miller & Morgan Counties 1,444 2,017 71.59% 2,450 58.94% 14813 9.75% Phelps, Crawford, Dent, Gasconade & Maries Counties 2,328 2,803 83.05% 3,666 63.50% 13600 17.12% St. Francois, Washington, Perry & Ste. Genevieve Counties 1,667 2,545 65.50% 2,579 64.64% 13346 12.49% Dunklin, Stoddard, New Madrid, Pemiscot & Mississippi Counties 1,795 2,922 61.43% 3,360 53.42% 16136 11.12% Butler, Ripley, Wayne, Madison, Iron, Reynolds & Carter Counties 1,453 2,138 67.96% 2,673 54.36% 12002 12.11% Howell, Texas, Wright, Douglas, Oregon, Ozark & Shannon Counties 1,487 2,598 57.24% 3,062 48.56% 13676 10.87% Data source: Census ACS 2015-2019 5-Year Estimates
Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri - 2021 Page 26
Map 2. Extremely Low Income Renter Households With Severe Cost Burden as a percentage of All Extremely Low Income Renter Households, 2019
Data source: American Community Survey, 2015-2019 5-Year Estimates
Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri - 2021 Page 27
AFFORDABLE AND AVAI LABLE ELI UNITS
Analysis of the number of affordable units and renter households only tells part of the story. Many affordable units may be unavailable because they are already occupied. Further, some units may have tenants with incomes above a specific income category. Thus, analysis based on both affordability and availability provides a more complete view for policy makers, decision makers, and housing stakeholders.9
Table 6 provides a statewide analysis of units affordable and available to ELI households.
Table 6. ELI Affordable and Available Unit Analysis
Rental Households With 30% AMI or Less 183,311 Total Units Affordable at 30% AMI or less 123,722 (Deficit) of Affordable Units at 30% AMI or Less (59,589) Units Affordable & Available at 30% AMI or Less 60,545 (Deficit) of Affordable & Available Units at 30% AMI or Less (122,766)
Data source: American Community Survey, 2015-2019 5-Year Estimates
Analysis of affordable units and number of ELI households alone reveals that Missouri has a deficit of 59,589 units for this income group. Once availability is added to the analysis, however, the deficit grows to 122,766.
Another way of understanding the status of affordable and available units is to analyze them by units per 100 households. In Missouri, there are 33 units that are both affordable and available for every 100 ELI households. Examined from another view, there are no affordable and available units for 67 out of every 100 ELI renter household in Missouri.
9 Carpenter, Ann, Douglas White, and Mary Hirt, “Rental Housing Affordability in the Southeast: Data from the Sixth District,” Atlanta, GA: Federal Reserve Bank of Atlanta, Community and Economic Development Discussion Paper No. 02-18, July 2018. https://www.frbatlanta.org/-/media/documents/community- development/publications/discussion-papers/2018/02-rental-housing-affordability-in-the-southeast- 2018-07-19.pdf.
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Although these figures give reason for continued concern, they do represent an improvement as compared with data presented in the Strategic Plan. The affordable and available units analysis in the Plan indicated that there were 31 units for every 100 ELI household, leaving 69 out of every 100 ELI renter household in Missouri facing a lack of affordable and available housing. The increased availability shown by analysis performed for this Update is a 6.45% increase and is tangible evidence of progress.
Table 7 presents information on ELI available and affordable units arranged by Metropolitan Statistical Area (MSA) and Missouri region. Missouri regions are used for county groupings outside of MSAs. Detailed definitions for each MSA and regional grouping are provided in the Appendix.
Table 7. ELI Affordable and Available Analysis by MSA and Region
Surplus Surplus Units (Deficit) of Rental Total Units (Deficit) of Affordable & Affordable & Households Affordable at Affordable Available at Available With 30% AMI 30% AMI or Units at 30% 30% AMI or Units at 30% Area or Less less AMI or Less Less AMI or Less Cape Girardeau, MO-IL (MSA) plus Scott (Sikeston, Micro) 3,885 2,433 (1,452) 1,252 (2,633) Columbia, MO (MSA) 9,284 3,799 (5,485) 1,841 (7,443) Fayetteville-Springdale- Rogers, AR-MO (MSA) 2187 2852 665 871 (1,316) Jefferson City, MO (MSA) 4,642 4,897 255 2,773 (1,869) Joplin, MO (MSA) 4,707 3,686 (1,021) 1,440 (3,267) Kansas City, MO-KS (MSA) plus Johnston (Warrensburg, Micro) 40,344 23,620 (16,724) 13,511 (26,833) St. Joseph, MO-KS (MSA) 3,098 2,737 (361) 1,294 (1,804) St. Louis, MO-IL (MSA) plus Audrain, Montgomery, & Pike 68,996 38,627 (30,369) 21,400 (47,596) Springfield, MO (MSA) plus Benton, Hickory, Laclede 16,524 8,759 (7,765) 3,648 (12,876) Northwest Missouri 2,434 3,903 1,469 1,477 (957)
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Surplus Surplus Units (Deficit) of Rental Total Units (Deficit) of Affordable & Affordable & Households Affordable at Affordable Available at Available With 30% AMI 30% AMI or Units at 30% 30% AMI or Units at 30% Area or Less less AMI or Less Less AMI or Less Northeast Missouri 3,726 3,899 173 1,936 (1,790) Pettis, Randolph, Saline, Cooper, Howard, Carroll & Chariton Counties 2,799 2,784 (15) 883 (1,916) Lawrence, Henry, Vernon, Cedar, Barton, St. Clair & Dade Counties 2,895 3,603 708 1,446 (1,449) Pulaski, Camden, Miller & Morgan Counties 2,450 3,977 1,527 1,370 (1,080) Phelps, Crawford, Dent, Gasconade & Maries Counties 3,666 3,333 (333) 1,204 (2,462) St. Francois, Washington, Perry & Ste. Genevieve Counties 2,579 2,060 (519) 798 (1,781) Dunklin, Stoddard, New Madrid, Pemiscot & Mississippi Counties 3,360 3,420 60 1,305 (2,055) Butler, Ripley, Wayne, Madison, Iron, Reynolds & Carter Counties 2,673 2,202 (471) 1,013 (1,660) Howell, Texas, Wright, Douglas, Oregon, Ozark & Shannon Counties 3,062 3,131 69 1,083 (1,979)
Data source: Census ACS 2015-2019 5-Year Estimates
The three areas with the largest deficits in ELI affordable and available units are the St. Louis, Kansas City, and Springfield MSAs. The Columbia and Cape Girardeau MSAs round out the top five geographic areas within Missouri with the greatest deficits in ELI affordable and available units. There are no MSAs or regions within Missouri where there are sufficient numbers of ELI affordable and available units.
Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri - 2021 Page 30
EFFECTIVE IMPLEMENTATION SUPPORT
One of the priorities identified in the Five-Year Strategic Plan for Affordable Housing for the State of Missouri is the use of implementation practices that support the attainment of other Strategic Plan priorities. MHDC provided effective implementation support for Strategic Plan priorities with its careful application of these priorities in the QAP 2020. Further evidence of effective implementation support is provided by the results of the 2020 competitive round of funding for multifamily development.
This Update also provides evidence that MHDC is engaging in effective implementation practices in support of the Strategic Plan. This Update will provide MHDC and a wide array of stakeholders with important information on how priorities included in the design of the QAP 2020 resulted in multifamily allocations reflective of these priorities. These analyses, coupled with new stakeholder input and updated data presentations, will provide a strong foundation for Strategic Plan implementation in 2021.
Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri - 2021 Page 31
CONCLUSION
This Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri demonstrates that Strategic Plan priorities published in mid-2020 have had a strong influence on the QAP 2020 and the results of the 2020 round of competition for multifamily development funding. New stakeholder input gathered in early 2021 and updated data analysis will provide a meaningful foundation for design of the 2021 QAP and the structure of the 2021 round of competition for multifamily funding in Missouri. Finally, the preparation of this Update is an important way in which MHDC is engaging in effective implementation practices in support of Missouri’s affordable housing strategic priorities.
Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri - 2021 Page 32
APPENDIX: CENSUS GEOGRAPHIC AREAS IN MISSOURI
Table 8. Census and Constructed MSAs Missouri
[See table on following page.]
Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri - 2021 Page 33
Census Name for the Actual Counties in Counties in ACS MSA Name Metropolitan & Micropolitan MSA PUMA Statistical Area Constructed MSA Cape Girardeau, MO-IL Bollinger, MO Bollinger MO Cape Girardeau, MO-IL (Metropolitan Statistical Cape Girardeau, MO Cape Girardeau (Metropolitan Statistical Area) Scott MO MO Area) plus Scott (Sikeston, Sikeston, MO (Micropolitan Scott MO Micro) Statistical Area) Columbia, MO Boone, MO Boone MO Columbia, MO (Metropolitan (Metropolitan Statistical Statistical Area) Area) Fayetteville-Springdale- McDonald, MO McDonald MO Fayetteville-Springdale- Rogers, AR-MO Barry MO Rogers, AR-MO (Metropolitan Statistical Stone MO (Metropolitan Statistical Area) Area) Taney MO Callaway MO Jefferson City, MO Callaway, MO Cole MO Jefferson City, MO (Metropolitan Statistical Cole, MO Moniteau MO (Metropolitan Statistical Area) Moniteau, MO Osage MO Area) Osage, MO Joplin, MO (Metropolitan Jasper, MO Jasper MO Joplin, MO (Metropolitan Statistical Area) Newton, MO Newton MO Statistical Area) Kansas City, MO-KS Bates, MO Bates MO Kansas City, MO-KS (Metropolitan Statistical Caldwell, MO Caldwell MO (Metropolitan Statistical Area) Cass, MO Cass MO Area) plus Johnston (Warrensburg, Micro) Warrensburg, MO Clay, MO Clay MO (Micropolitan Statistical Area) Clinton, MO Clay MO Jackson, MO Clay MO Lafayette, MO Clinton MO Platte, MO Jackson MO Ray, MO Johnson MO Johnson, MO Lafayette MO Platte MO Ray MO St. Joseph, MO-KS Andrew, MO Andrew MO St. Joseph, MO-KS (Metropolitan Statistical Buchanan, MO Buchanan MO (Metropolitan Statistical Area) Area) DeKalb, MO DeKalb MO
Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri - 2021 Page 34
Census Name for the Actual Counties in Counties in ACS MSA Name Metropolitan & Micropolitan MSA PUMA Statistical Area Constructed MSA St. Louis, MO-IL Franklin, MO Audrain MO St. Louis, MO-IL (Metropolitan Statistical Jefferson, MO Franklin MO (Metropolitan Statistical Area) Lincoln, MO Jefferson MO Area) plus Audrain, Montgomery, & Pike Mexico, MO (Micropolitan St. Charles, MO Jefferson MO Statistical Area) St. Louis, MO Lincoln MO Warren, MO Montgomery MO St. Louis Pike MO (Independent City), St. Charles MO MO St. Louis MO Audrain, MO Warren MO St. Louis city MO St. Louis city MO Springfield, MO Christian, MO Benton MO Springfield, MO (Metropolitan Statistical Dallas, MO Christian MO (Metropolitan Statistical Area) Area) plus Benton, Hickory, Greene, MO Dallas MO Laclede Lebanon, MO (Micropolitan Polk, MO Greene MO Statistical Area) Webster, MO Hickory MO Laclede, MO Laclede MO Polk MO Webster MO Maryville, MO (Micropolitan Nodaway, MO Atchison MO Northwest Missouri Statistical Area) Daviess MO Gentry MO Grundy MO Harrison MO Holt MO Linn MO Livingston MO Mercer MO Nodaway MO Putnam MO Sullivan MO Worth MO
Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri - 2021 Page 35
Census Name for the Actual Counties in Counties in ACS MSA Name Metropolitan & Micropolitan MSA PUMA Statistical Area Constructed MSA Fort Madison-Keokuk, IA- Clark, MO Adair MO Northeast Missouri IL-MO (Micropolitan Marion, MO Clark MO Statistical Area) Ralls, MO Knox MO Hannibal, MO (Micropolitan Adair, MO Lewis MO Statistical Area) Schuyler, MO Macon MO Kirksville, MO (Micropolitan Statistical Area) Lewis, MO Marion MO Quincy, IL-MO Monroe MO (Micropolitan Statistical Ralls MO Area) Schuyler MO Scotland MO Shelby MO Marshall, MO (Micropolitan Saline, MO Carroll MO Pettis, Randolph, Saline, Statistical Area) Randolph, MO Chariton MO Cooper, Howard, Carroll & Moberly, MO (Micropolitan Pettis, MO Cooper MO Chariton Counties Statistical Area) Howard MO Sedalia, MO (Micropolitan Pettis MO Statistical Area) Randolph MO Saline MO Barton MO Lawrence, Henry, Vernon, Cedar MO Cedar, Barton, St. Clair & Dade MO Dade Counties Henry MO Lawrence MO St. Clair MO Vernon MO Camden MO Miller MO Morgan MO Pulaski MO Fort Leonard Wood, MO Pulaski, MO Pulaski, Camden, Miller & (Micropolitan Statistical Morgan Counties Area)
Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri - 2021 Page 36
Census Name for the Actual Counties in Counties in ACS MSA Name Metropolitan & Micropolitan MSA PUMA Statistical Area Constructed MSA Crawford MO Phelps, Crawford, Dent, Dent MO Gasconade & Maries Gasconade MO Counties Maries MO Phelps MO Rolla, MO (Micropolitan Phelps, MO Perry MO St. Francois, Washington, Statistical Area) Ste. Genevieve Perry & Ste. Genevieve MO Counties St. Francois MO Washington MO Kennett, MO (Micropolitan Dunklin, MO Dunklin MO Dunklin, Stoddard, New Statistical Area) Mississippi MO Madrid, Pemiscot & New Madrid MO Mississippi Counties Pemiscot MO Stoddard MO Poplar Bluff, MO Butler, MO Butler MO Butler, Ripley, Wayne, (Micropolitan Statistical Carter MO Madison, Iron, Reynolds & Area) Iron MO Carter Counties Madison MO Reynolds MO Ripley MO Wayne MO West Plains, MO Howell, MO Douglas MO Howell, Texas, Wright, (Micropolitan Statistical Howell MO Douglas, Oregon, Ozark & Area) Shannon Counties Oregon MO Ozark MO Shannon MO Texas MO Wright MO
Update to the Five-Year Strategic Plan for Affordable Housing for the State of Missouri - 2021 Page 37 4) Report of Staff j. Resolution No. 877
RESOLUTION NO. 877 AUTHORIZED SIGNATORIES OF MISSOURI HOUSING DEVELOPMENT COMMISSION REVISED: JUNE 22, 2021
RESOLVED, that within the course and scope of their duties, each of the following shall be an authorized officer for the purpose of signing certifications and other instruments provided by or adopted by the Commission.
FURTHER RESOLVED, that the following officers are authorized to sign all instruments and any such instruments made or executed by any of the named officers are hereby adopted and ratified:
Mike Kehoe Chairman Mark Elliff Secretary-Treasurer Tina Beer Deputy Director/Director of Operations/Assistant Secretary Marilyn V. Lappin Director of Finance Sara A. Turk Controller Jennifer Schmidt Deputy Director of Operations
FURTHER RESOLVED, that the following officers are authorized to sign all bond financing documents:
Mike Kehoe Chairman Mark Elliff Secretary-Treasurer Marilyn V. Lappin Director of Finance Tina Beer Deputy Director/Director of Operations/Assistant Secretary Sara A. Turk Controller
FURTHER RESOLVED, that the following officers are authorized as signers on bank accounts and investments:
Marilyn V. Lappin Director of Finance Sara A. Turk Controller Annette Moling Accounting Manager Tina Beer Deputy Director/Director of Operations/Assistant Secretary
FURTHER RESOLVED, that the following officer is designated as the Chief Environmental Officer and is authorized to sign all documents related to environmental assessment, analysis and review:
Tina Beer Deputy Director/Director of Operations/Assistant Secretary
FURTHER RESOLVED, that the following officer is authorized to sign all documents related to the administration of federal programs including, but not limited to, Emergency Solutions Grant, National Housing Trust Fund, HOME, Section 8 Annual Contributions Contracts, and LIHTC:
Tina Beer Deputy Director/Director of Operations/Assistant Secretary Jennifer Schmidt Deputy Director of Operations
FURTHER RESOLVED, that all of the above-named officers are authorized to sign all documents in connection with all areas of business designated below and, in addition, the following named persons are authorized to documents in connection with specific areas of business as designated:
Diana Peck-Muntzel Accounting & Loan Servicing Manager Loan Servicing Brianne Cabe Tax Credit Administrator Federal and Missouri LIHTC, AHAP, Construction disbursement, HOME, HeRO, National Housing Trust Fund Jennifer Miller HUD Programs Manager Construction disbursement, HOME, HeRO, National Housing Trust Fund Rick Laughrey Single Family Homeownership Manager Homeownership Scott Hanak Director of Asset Management Asset Management programs including, but not limited to, Section 8 Annual Contributions Contracts
CERTIFICATION: I HEREBY CERTIFY that the foregoing is a true and correct copy of a Resolution regularly presented to, and duly adopted by, the commissioners of Missouri Housing Development Commission at a meeting duly called and held in Jefferson City, Missouri on the 22nd day of June, 2021, at which a quorum was present and voted, and that such Resolution is duly recorded in the minutes of the commission.
______Secretary-Treasurer or Assistant Secretary
June 22, 2021
TO: Commissioners Missouri Housing Development Commission
FROM: Kip Stetzler Mike Parson Executive Director Governor Mike Kehoe SUBJECT: Affordable Housing Developments -- Cost Increase Lieutenant Governor Chairman Scott Fitzpatrick Construction costs have increased at an alarming rate and the potential impact on the delivery State Treasurer of affordable housing is significant. Developments may require additional funding. Attached Eric Schmitt are the following draft forms, copies of which are included in your material, designed to assist Attorney General developers and commissioners concerning requests for additional funding (Funding Increase Tracey S.C. Lewis Request Forms): Vice Chairman Mark Elliff Increase Request Workbook Secretary-Treasurer Sources Increase Request Rick McDowell Construction Cost Worksheet Commissioner Development Cost Worksheet Garrick Hamilton Commissioner Staff proposes a deadline of Monday, July 8, 2021 at 5:00 pm CST to submit the Funding Danny P. Chadakhtzian Increase Request Forms and supporting documentation. Staff further proposes a Board Commissioner Meeting on Thursday, July 15, 2021 at 9:00 am, to continue on Friday, July 16, 2021 at 9:00 am Stephen J. Parshall if necessary, to consider all requests for increases in funding. Commissioner
Staff recommends approval of the Funding Increase Request Forms and approval of the process outlined above. Kip Stetzler Executive Director
Kansas City 920 Main, Suite 1400 Kansas City, MO 64105 816-759-6600 Fax 816-301-7000
St. Louis 505 N. 7th Street 20th Floor, Suite 2000 St. Louis, MO 63101 www.mhdc.com
MHDC Sources Increase Request Workbook
Narrative 1: The developer must supply a narrative summarizing the reasons for the request of additional MHDC sources and describe all methods undertaken to contain costs.
Supporting Documentation 1: The developer must supply supporting documentation in the form of bids and/or correspondence from suppliers detailing projected increased costs.
Sources Increase Request Spreadsheet 1: Project Name: This is the development name referenced in the Conditional Reservation. 2: Project Number: This is the development number assigned by MHDC at Conditional Reservation. 3: Date: This is the date this form is signed by developer. 4: Conditional Funding Amount: This is the amount of each source allocated by MHDC at Conditional Commitment. The State LIHTC amount will automatically calculate at 70% of the Federal LIHTC amount. 5: Requested Increase Amount: This is the amount of increase for each source the developer is requesting over the amount allocated by MHDC at Conditional Commitment. The State LIHTC amount will automatically calculate at 70% of the Federal LIHTC increase request. 6: Total Funding Request Amount: This is the amount of line 4 plus line 5. It will self populate. 7: Percent Increase: This is the Requested Increase Amount as a percent of the Conditional Funding Amount. It will self populate. 8: Fed. LIHTC at Conditional: This is the price per Federal LIHTC and Ownership % at Conditional Commitment. Total LIHTC Equity will self populate. 9: State LIHTC at Conditional: This is the price per State LIHTC at Conditional Commitment. Ownership % will self populate at 100%. Total LIHTC Equity will self populate. 10: Fed. LIHTC Projected at Firm Submission: This is the price per Federal LIHTC and Ownership % the developer will designate within the FIN-100 at Firm Submission. Total LIHTC Equity will self populate. 11: State LIHTC Projected at Firm Submission: This is the price per State LIHTC the developer will designate within the FIN-100 at Firm Submission. Ownership % will self populate at 100%. Total LIHTC Equity will self populate. 12: Increase in Fed. LIHTC equity. This is the difference between Total LIHTC Equity for Fed. LIHTC at Conditional and Total LIHTC Equity for Fed. LIHTC Projected at Firm Submission. This will self populate. 13: Increase in State LIHTC equity. This is the difference between Total LIHTC Equity for State LIHTC at Conditional and Total LIHTC Equity for State LIHTC Projected at Firm Submission. This will self populate. 14: Increase in MHDC Fund Balance. This is the Requested Increase Amount for Fund Balance. This will self populate from line 5. 15: Increase in MHDC HOME: This is the Requested Increase Amount for MHDC HOME. This will self populate from line 5. 16: Total Additional Sources: This is the amount of Increase in Fed. LIHTC Equity plus Increase in State LIHTC Equity plus Increase in MHDC Fund Balance plus Increase in MHDC HOME. This will self populate. 17: Increase in Construction Costs. This is the amount of Increased Construction Costs on line 66 of the Construction Cost (CC) spreadsheet. 18: Increase in Soft Costs: This is the difference between Increased Construction Costs on line 66 of the Construction Cost (CC) spreadsheet and the Increased Total Development Costs on line 84 of the Development Costs (DV) spreadsheet. 19: Increase in Total Costs: This is the amount of Increased Total Development Costs on line 84 of the Development Costs (DV) spreadsheet. 20: Additional Sources (above). This will self populate from line 16. 21: Cost NOT covered by Additional Sources. This is the amount of Increase in Total Costs less Additional Sources (above). 22: Increased Sources Exceed Increased Costs. This is the amount of Additional Sources (above) less Increase in Total Costs. 23: Additional Comments. This area is provided for additional developer comments not detailed in comments within the Construction Costs (CC) spreadsheet or the Developer Cost (DV) spreadsheet. 24: Requestor. This is where the developer will sign. 25: Rental Production Approval. This is where MHDC will sign. 26: Tax Credit Approval. This is where MHDC will sign.
Construction Cost (CC) Spreadsheet Within each cell of the column labeled "Conditional Commitment Cost. (Conditional FIN-100) A" the total should reflect the amount approved at Conditional Reservation for each category. Within each cell of the column labeled "Revised Cost B" the total should mirror the amount that will be reflected within the FIN-115 that will be submitted at Firm Submission for each category. Within each cell of the column labeled "Comment" the developer should comment to MHDC the reason for any cost increase."
Development Cost (DV) Spreadsheet Within each cell of the column labeled "Conditional Commitment Cost. (Conditional FIN-100) A" the total should reflect the amount approved at Conditional Reservation for each category. Within each cell of the column labeled "Revised Cost B" the total should mirror the amount that will be reflected on the "VIII. Development Costs" spreadsheet within the FIN-100 that will be submitted at Firm Submission for each category. Within each cell of the column labeled "Comment" the developer should comment to MHDC the reason for any cost increase." Request for increase of sources from MHDC
1: Project Name: For purposes of this form, "Conditional" is a 2: Project Number: reference to the Conditional Reservation. 3: Date:
Federal LIHTC State LIHTC MHDC Fund Balance MHDC HOME 4: Conditional Funding Amount: $ - $ - $ - $ - 5: Requested Increase Amount: $ - $ - $ - $ - 6: Total Funding Request Amount: $ - $ - $ - $ - 7: Percent Increase: #DIV/0! #DIV/0! #DIV/0! #DIV/0!
Price per LIHTC Ownership % Total LIHTC Equity 8: Fed. LIHTC at Conditional $ - 0.00% $ - 9: State LIHTC at Conditional $ - 100.00% $ - 10: Fed. LIHTC Projected at Firm Submission $ - 0.00% $ - 11: State LIHTC Projected at Firm Submission $ - 100.00% $ - 12: Increase in Fed. LIHTC Equity $ - # # 13: Increase in State LIHTC Equity $ - 14: Increase in MHDC Fund Balance $ - 15: Increase in MHDC HOME $ - 16: Total Additional Sources $ - #REF! 17: Increase in Construction Costs $ - 18: Increase in Soft Costs $ - 19: Increase in Total Costs $ - 20: Additional Sources (above) $ - 21: Cost NOT covered by Additional Sources $ - 22: Increased Sources EXCEED Increased Costs $ -
Additional Comments: 23:
24:
Requestor Date
25:
Rental Production Approval Date
26:
Tax Credit Approval Date
Rev. 05/2016 MISSOURI HOUSING DEVELOPMENT COMMISSION Construction Costs
PROJECT: 0 MHDC NO.: 0
Line Conditonal Commitment Revised Difference # Description Cost Cost Comment (Conditional FIN-100) A B C
1 Earthwork $ - $ - $0.00 2 Site Utilities $ - $ - $0.00 3 Roads & Walks $ - $ - $0.00 4 Off-site Work $ - $ - $0.00 5 Concrete $ - $ - $0.00 6 Masonry $ - $ - $0.00 7 Structural Metals $ - $ - $0.00 8 Rough Carpentry $ - $ - $0.00 9 Finish Carpentry $ - $ - $0.00 10 Cabinets $ - $ - $0.00 11 Waterproofing $ - $ - $0.00 12 Insulation $ - $ - $0.00 13 Roofing Systems $ - $ - $0.00 14 Siding $ - $ - $0.00 15 Gutters and Downspouts $ - $ - $0.00 16 Doors and Hardware $ - $ - $0.00 17 Windows $ - $ - $0.00 18 Drywall $ - $ - $0.00 19 Flooring $ - $ - $0.00 20 Carpet $ - $ - $0.00 21 Painting $ - $ - $0.00 22 Signage $ - $ - $0.00 23 Bathroom and Closet Accessories$ - $ - $0.00 24 Appliances $ - $ - $0.00 25 Window Coverings $ - $ - $0.00 26 Plumbing $ - $ - $0.00 27 Fire Sprinklers $ - $ - $0.00 28 HVAC $ - $ - $0.00 29 Electrical $ - $ - $0.00 30 Fire Alarm Systems $ - $ - $0.00 31 Special Equipment $ - $ - $0.00 32 Landscaping $ - $ - $0.00 33 MHDC Approved Impact Fees $ - $ - $0.00 34 Demolition (interior rehab) $ - $ - $0.00 35 Demolition (land make ready) $ - $ - $0.00 36 Sheetmetal $ - $ - $0.00 37 Accessory Building Subtotal $ - $ - $0.00 38 Bonding $ - $ - $0.00 39 Permits $ - $ - $0.00 40 41 SUBTOTAL $ - $ - $0.00 42 43 General Requirements $ - $ - $0.00 44 Builder's Overhead $ - $ - $0.00 45 Builder's Profit $ - $ - $0.00 46 47 TOTAL CONST. $ - $ - $ -
6/15/2021 MHDC Resources Increase 06.15.2021.xlsx Construction Cost (CC) MISSOURI HOUSING DEVELOPMENT COMMISSION Development Costs
PROJECT: 0 MHDC NO.: 0
Conditional Commitment Revised Difference Comment (any and all soft costs that increase over the Conditional Cost Cost Commitment amount must provide detail about the reason for the DESCRIPTION OF COST (Conditional FIN-100) increase)
Construction (from CC Worksheet) $0.00 $0.00 $0.00 Construction Costs paid by Owner $0.00 $0.00 $0.00 Architect Fee - Design $0.00 $0.00 $0.00 Architect Fee - Supervision $0.00 $0.00 $0.00 Soil Report $0.00 $0.00 $0.00 Survey $0.00 $0.00 $0.00 Engineering $0.00 $0.00 $0.00 Construction Interest $0.00 $0.00 $0.00 Construction Period Real Estate Taxes $0.00 $0.00 $0.00 Construction Period Insurance $0.00 $0.00 $0.00 MHDC Rental Production Application Fee $0.00 $0.00 $0.00 MHDC Construction Loan Fee $0.00 $0.00 $0.00 Other Construction Loan Fee $0.00 $0.00 $0.00 MHDC Construction Inspection Fee $0.00 $0.00 $0.00 Other Construction Inspection Fee $0.00 $0.00 $0.00 MHDC Permanent Financing Fee $0.00 $0.00 $0.00 Other Permanent Financing Fee $0.00 $0.00 $0.00 Environmental Study $0.00 $0.00 $0.00 Market Study $0.00 $0.00 $0.00 Appraisal $0.00 $0.00 $0.00 Title/Recording/Disbursing (Construction) $0.00 $0.00 $0.00 Title/Recording/Disbursing (Permanent) $0.00 $0.00 $0.00 Legal Costs (Construction) $0.00 $0.00 $0.00 Legal Costs (Permanent) $0.00 $0.00 $0.00 Organization (Legal/Fees) $0.00 $0.00 $0.00 Cost Certification $0.00 $0.00 $0.00 Accountant's Fee $0.00 $0.00 $0.00 Contingency $0.00 $0.00 $0.00 Environmental Abatement $0.00 $0.00 $0.00 Historic Credit Fees $0.00 $0.00 $0.00 Relocation $0.00 $0.00 $0.00 F F & E $0.00 $0.00 $0.00 Other #1: $0.00 $0.00 $0.00 Other #2: $0.00 $0.00 $0.00 Other #3: $0.00 $0.00 $0.00 Other #4: $0.00 $0.00 $0.00 Other #5: $0.00 $0.00 $0.00 Legal Acquisition and Recording $0.00 $0.00 $0.00 Acquistion Cost of Building $0.00 $0.00 $0.00 Other Acquisition Related Costs $0.00 $0.00 $0.00 Land $0.00 $0.00 $0.00 Consultant Fee (Before Completion) $0.00 $0.00 $0.00 Consultant Fee (After Completion) $0.00 $0.00 $0.00 Developer Fee (Before Completion) $0.00 $0.00 $0.00 Developer Fee (After Completion) $0.00 $0.00 $0.00 Tax Credit Fee $0.00 $0.00 $0.00 Tax Credit Monitoring Fee $0.00 $0.00 $0.00 AHAP Application and Reservation Fee $0.00 $0.00 $0.00 Other #1: $0.00 $0.00 $0.00 Other #2: $0.00 $0.00 $0.00 Other #3: $0.00 $0.00 $0.00 Other #4: $0.00 $0.00 $0.00 Other #5: $0.00 $0.00 $0.00 Bond Related Costs $0.00 $0.00 $0.00 Syndication Costs $0.00 $0.00 $0.00 Lease Up Escrow $0.00 $0.00 $0.00 Operating Reserve $0.00 $0.00 $0.00 Replacement Reserve $0.00 $0.00 $0.00 Other: Special Needs Escrow $0.00 $0.00 $0.00 Other Escrow #1: $0.00 $0.00 $0.00 Other Escrow #2: $0.00 $0.00 $0.00 Other Escrow #3: $0.00 $0.00 $0.00 Other Escrow #4: $0.00 $0.00 $0.00 Other Escrow #5: $0.00 $0.00 $0.00 Increased Total Development Costs
TOTAL DEV. COSTS $0.00 $0.00 $0.00
6/15/2021 MHDC Resources Increase 06.15.2021.xlsx Development Costs (DV) 5) Such other matters that may come before the Commission