[00:00:01]
ALRIGHT,[Dallas Housing Finance Corporation on June 10, 2025.]
I'M GONNA CALL THIS MEETING TO ORDER.WE'RE HAVING WAY TOO MUCH FUN.
UH, I WILL, I'M MARCY HEALTH VAN, PRESIDENT OF DALLAS HOUSING FINANCE CORPORATION FOR ANYONE WHO MIGHT BE ONLINE.
UM, AND I WILL TURN IT OVER TO MS. SCHROEDER FOR THE, WELL, YOU DON'T HAVE MY SCREEN.
BUT I THOUGHT THAT IT JUST TAKES THE SOUND.
UH, DIRECTOR MARCH OR SEE DIRECTOR JACK MARSHALL FEE PRESENT.
PRESENT DIRECTOR PATTY COLLIN.
PRESENT DIRECTOR OLIVER ROBINSON.
UM, ACTUALLY HE'S OUT A COUNTRY.
UH, ANTHONY PAGE PRESENT AND DIRECTOR SEAN SADIE PRESENT.
AND WITH THAT WE DO HAVE FORM.
I'LL NOW, UH, OPEN IT UP TO, UH, ANY MEMBER OF THE PUBLIC THAT WOULD LIKE TO MAKE A COMMENT ON ITEMS FOUR THROUGH 12.
I'VE WRITTEN ALL OF YOU AND COUNCIL MEMBERS, UH, CONCERNING MY VIEW OF THE PROPOSED CHANGES TO THE GOVERNANCE OF THE HSC AND THE PFC.
UM, I REPRESENT AFFORDABLE HOUSING DEVELOPERS.
YOU ALL KNOW THAT I HAVE NOT DONE ANY HSC WORK YET, BUT I DEFINITELY WANT TO.
UH, AND I'VE HAD A LOT OF INTERACTION WITH POC ANYWAY.
NOBODY'S PAYING ME TO BE HERE TODAY IS THE, IS THE POINT.
UM, I THINK YOU ALL KNOW WHAT MY CONCERNS ARE BECAUSE I THINK I'VE, I'VE GIVEN 'EM TO YOU IN WRITING, BUT I THOUGHT IT WOULD BE USEFUL FOR THE BOARD TO HEAR WHAT I COULD OBSERVED ON THE HOUSING COMMITTEE AND IN PROJECT DISCUSSIONS WITH COUNCIL MEMBERS.
AND THAT OBSERVATION IS THAT FOR SIMPLICITY PURPOSES, I WOULD SAY THAT THESE CHANGES HAVE LOST POLITICAL STEAM.
UH, I DON'T THINK MORE THAN THREE MEMBERS OF COUNCIL SUPPORT THEM, AND ONE OF THOSE I THINK MIGHT HAVE GOTTEN OVER IT ALSO.
UM, SO IT'S MY ADVICE FOR WHAT IT'S WORTH, THAT THE BOARD, UH, SHOULD HAVE A FREE HAND TO CONTINUE THE WORK HE'S DOING.
AND THE REASON I THINK THAT THE CHANGES HAVE LOST POLITICAL WILL IS THAT THE HFC AND THE PFC ARE BOTH DOING NOTICEABLY GOOD WORK.
UM, THIS BODY HAD A LOT OF CONCERNS BACK WHEN I WAS ON COUNCIL, AND WE ADOPTED A SLATE OF CHANGES TO THAT BOARD, AND THEY, TO ME, APPEARED FOR WORK.
SO THANK YOU FOR YOUR SERVICE AND, UM, IF I CAN HELP IN THE FUTURE, PLEASE LET ME KNOW IF YOU HAVE ANY QUESTIONS, I'M HAPPY TO ANSWER EM.
UM, ONE, I, I APPRECIATE YOUR COMMENTS ABOUT OUR, OUR GOOD WORK, BUT LET'S JUST SAY IN THE WORST CASE SCENARIO, YOU WEREN'T, YOU WEREN'T DOING GOOD WORK.
UH, THE PROBLEMS I'M HAVING WITH THE HOUSING DEPARTMENT'S, UH, PROPOSALS ARE THAT THEY SEEM TO BE A VARIANCE WITH TEXAS CORPORATE LAW IN CHAPTER 3 94.
AND SO THE, I WAS WONDERING IF YOU HAD ANY THOUGHTS ABOUT THAT, AND SPECIFICALLY ON CORPORATE GOVERNANCE AS A INDEPENDENT CORPORATION, HOW MUCH FLEXIBILITY DOES OUR BOARD OF DIRECTORS HAVE IN DELEGATING OR SEATING
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RESPONSIBILITIES TO THIRD PARTIES? SO WE DON'T GET FROM WHEN WE AS DIRECTORS RETAIN THE, THE LIABILITIES AND THE OBLIGATION TO, TO GOVERNMENT CORPORATION? THAT'S NUMBER ONE.AND THEN THE SECOND THING IS CHAPTER 3 94.
IF I READ THROUGH THE LEGISLATIVE HISTORY, IT APPEARS THAT THE ENTIRE INTENT OF 3 94 WAS TO CREATE A BODY THAT WAS MORE NIMBLE AND HAD THE ABILITY TO WORK OUTSIDE THE CONSTRUCTS OF A TYPICAL CITY HOUSING DEPARTMENT.
SO IT SEEMS LIKE THE, THE DIRECTION OF THE PROPOSAL IS RUNNING KIND OF, YOU KNOW, IN CROSS PURPOSES OF WHAT THE INTENT OF THIS, OF THE, UH, TEXAS STATE LEGISLATURE WAS.
SO I, I DO SEE LEGAL RISK IN THE PROPOSALS.
UM, THE BOTH PFC AND HFC ARE CREATURES OF STATE LAW THAT WERE CREATED WITH A SPECIFIC IDEA OF ALLOWING A DIFFERENT SOURCE OF FUNDING, AND IN SOME CASES, USE OF FUNDING, UM, THAT IS PRESCRIBED BY STATE LAW.
AND THE, THE, THE STATE WAS NOT WILLING TO DO THAT WITHOUT INDEPENDENT OVERSIGHT.
UM, WHICH I THINK IS ALSO BENEFICIAL FROM THE STANDPOINT OF THE CITY COUNCIL BECAUSE THEIR, UH, ROLE IS TO BE THE FIDUCIARY FOR THE CITIZENS.
AND AS PART OF THAT ROLE, STATE LAW REQUIRES THE CITY TO OPERATE A GENERAL FUND BUDGET WITH SOME SAFEGUARDS ABOUT SEGREGATING, UH, FUNDING TO SPECIFIC PURPOSES.
AND SO, IF THE CITY WERE TO ATTEMPT TO DO WHAT THE HFC IS DOING, I BELIEVE IT WOULD NOT BE ABLE TO KEEP THE FUNDS THAT ARE THE PROCEEDS OF HFC PROJECTS SEGREGATED TO A SPECIFIC PURPOSE.
AFFORDABLE HOUSING AS ASSISTANCE.
SIMILARLY WITH THE, THE PFC, THAT'S A VERY, I MEAN, PFCS EVEN MORE, UM, UH, CONTROVERSIAL BECAUSE OF SOME MISBEHAVIOR OF SOME PFC BOARDS THAT ARE NOT DALLAS.
UM, AND, BUT THAT'S, YOU KNOW, A TAX ABATEMENT.
AND ABSENT THAT ENABLING LEGISLATION, THE STATE IS, UH, REQUIRED TO MAKE SURE THAT, THAT THAT TAXES GET PAID AND GO TO PUBLIC PURPOSES.
NOT THE PSC ISN'T A PUBLIC PURPOSE, BUT IT'S A SPECIFIC CARVE OUT IN STATE LAW TO SEGREGATE FUNDING FOR THE IN.
IT'S NOT REALLY FUNDING IN THEIR INSTANCE, IT'S THE ABATEMENT FOR THE PURPOSES OF THE PFC.
UM, SO I, I THINK IT'S, I THINK IT'S PLAYING WITH FIRE.
UM, IF THE, IF YOU HAVE PFCS AND HFCS THAT AREN'T DOING A GOOD JOB, STATE LAW ALSO HAS MECHANISMS FOR CORRECTING THAT VIA THE SPONSORING ENTITY OR THE ATTORNEY GENERAL.
SO I DON'T, I DON'T FORESEE ANYBODY, THE CITIZENS BECOMING IN DANGER FROM A RUNAWAY DFC OR H OF C.
UM, SO YOU'RE SAYING THE, OKAY, THE PROPOSALS HAVE BEEN GOING BACK FORTH BETWEEN US CITY COUNCIL, ALL THAT OVER THE LAST SIX MONTHS.
YOU'RE SAYING THAT IN YOUR READ OF, YOU KNOW, YOUR RELATIONSHIP WITH COUNCIL IS LITTLE STEEP WITH THE COUNCIL, IS THAT CORRECT? THAT'S MY READ ON IT.
AND FOR, DO YOU THINK THE HOUSING DEPARTMENT
UM, THE, THIS IS EDITORIAL, BUT THE HOUSING POLICY CHANGES WE ADOPTED IN JANUARY OF LAST YEAR APPEAR TO ME TO NOT BE WORKING.
UM, THEY'VE HAD A PAUCITY OF NOFA APPLICATIONS.
UM, AND SO I THINK THAT'S A CLEAR SIGN THAT DEVELOPERS ARE NOT INTERESTED IN THE TARGET AREAS AT THE FUNDING LEVELS THAT ARE AVAILABLE.
UM, ALSO THE RULE ABOUT YOU CAN ONLY HAVE ONE PROJECT IS EXTREMELY STRANGE.
I THINK IT WAS INTENDED TO FRAME A NEW GENERATION OF DEVELOPERS, BUT THAT'S JUST NOT HOW THAT WORKS.
UM, YOU, YOU NEED A POSSIBILITY OF REPEATABLE SUCCESS IN ORDER TO BE PARTNERS WITH DEVELOPING.
AND JUST TO CLARIFY, SO, UM, I JUST WANNA MAKE IT CLEAR THAT, THAT THESE COMMENTS ARE IN REGARD TO AGENDA ITEM 11.
I SHOULD HAVE MENTIONED THAT
WAS THERE ANYONE ELSE WHO HAD A PUBLIC COMMENT? OKAY, I'LL MOVE ON TO AGENDA ITEM FOUR, APPROVAL OF THE MINUTES FOR THE APRIL 8TH, 2025.
HAS IT BEEN IN PREPARATION MEETING? AND UM, I'LL ENTERTAIN A MOTION IN A SECOND AND THEN WE CAN DISCUSS
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DIRECTOR ALLEN.AND DO I HAVE A SECOND? I'LL SECOND.
UH, DID ANYONE HAVE ANY ADDITIONS OR CORRECTIONS TO THE MINUTES? ALRIGHT, ANYBODY ONLINE? NO.
ANY OPPOSED? OKAY, MINUTES ARE APPROVED.
THIS IS THE RESOLUTION FOR THE LEGACY ON KEITH, A MULTI-FAMILY RESIDENTIAL DEVELOPMENT TO BE LOCATED AT 26 21 SUTHERLAND AVENUE, DALLAS, DALLAS COUNTY, TEXAS 7 5 2 0 3.
THE, THE RESOLUTION, THE ACTION ITEM IS TO CONSIDER AND ADOPT RESOLUTIONS APPROVING THE FORM AND SUBSTANCE OF AND AUTHORIZING THE EXECUTE EXECUTION AND DELIVERY OF DOCUMENTS AND INSTRUMENTS NECESSARY TO CARRY OUT THE FINANCING AND CONSTRUCTION OF THE LEGACY ON KEY, A MULTI-FAMILY RESIDENTIAL DEVELOPMENT TO BE LOCATED AT 26 21 SUTHERLAND AVENUE, THE KEY DEVELOPMENT AND CONTAINING OTHER PROVISIONS RELATING TO SUCH DEVELOPMENT, INCLUDING A RESOLUTION OF PROVING THE GROUND LEASE BETWEEN LBG, THE LEGACY ON KEAST LP, THE KE BORROWER, AND DHF, THE LEGACY ON KEAST LANDOWNER LLC IN PARTNERSHIP RESOLUTIONS AUTHORIZING THE ADMISSION OF DHFC, THE LEGACY ON KE GLLC, THE KEY GENERAL PARTNER TO THE KEY BORROWER AND FINANCING FOR THE KEY DEVELOPMENT TO INCLUDE ONE GOVERNMENTAL NOTES ISSUED BY THE TEXAS DEPARTMENT OF HOUSING AND COMMUNITY AFFAIRS, THE T-D-T-D-H-C-A, THE PROCEEDS OF WHICH WILL BE LOANED TO THE KEY BORROWER TWO EQUITY FINANCING BY R FOUR LKTX ACQUISITION, LL C3, SUBORDINATE LOAN FINANCING BY RICK HOUSE DESIGN, LLC AND NUMBER FOUR, SUBORDINATE LOAN FINANCING BY THE CORPORATION AND AUTHORIZING AND RATIFYING ACTIONS IN THE EXECUTION OF DOCUMENTS BY THE CORPORATION'S PRESIDENT, OTHER OFFICERS, GENERAL MANAGER AND ASSISTANT GENERAL MANAGER IN CONNECTION WITH THE ABOVE REFERENCED TRANSACTION.
SO DOES EVERYONE WANNA DO A PRESENTATION? YEAH.
UM, SO WE HAVE SEEN THIS SEVERAL TIMES.
THIS IS ACTUALLY APPROVAL OF THE FINAL APPROVAL.
UM, I DON'T KNOW IF WE WANNA PRESENT EVERYTHING AGAIN, BUT THEY GIVE QUESTIONS IF YOU GUYS HAVE THEM.
AND, UH, I THINK PROBABLY JUST OPEN IT UP FOR QUESTIONS AND, UM, LET EVERYONE KNOW WHEN WE ANTICIPATE THERE MIGHT BE THE CLOSING.
I THINK WE'RE SLATED FOR THE FIRST WEEK OF LIVE.
SO THAT'S WHY THIS IS OUR FINAL APPROVAL OF THE DOCUMENTS.
SO JUST WANTED TO LET EVERYONE KNOW THAT'LL BE EXCITING TO HAVE ANOTHER PROPERTY UNDERWAY.
SO, UH, CLOSING ON JULY THE SECOND.
SO IT'S MARC, SHE SAID THAT'S WHY WE'RE HERE, BUT, UH, YEAH, I THINK YOU GUYS HAVE SEEN THIS AT LEAST TWICE BEFORE.
UM, SO WE'RE JUST BACK WITH FINAL APPROVAL OF DOCUMENTS.
I THINK WE'RE IN REALLY GOOD SHAPE, UH, AS FAR AS THE CLOSING PROCESS GOES.
SO I DON'T ANYTHING'S POSSIBLE, BUT, YOU KNOW,
LET'S MAY FLY TO OLIVER, UH, SPONSORS AT THE MOMENT SINCE HOUSE BILL 21 PASSED, YOU KNOW, CERTAINLY ON WORKFORCE THERE'S A MASSIVE FREAK OUT THE CAPITAL MARKET ABOUT PROBABLY PROPERTY TAX EXEMPTION, UH, FROM ANYBODY SAY IN TEXAS, UH, Y TECH DEALS.
UH, THE, YOUR LENDER, HAVE THEY TELEGRAPHED ANYTHING ABOUT PRIVATE EXEMPTIONS FOR LIVE? NOT ON THIS FIELD SPECIFICALLY.
WE'VE HAD CONVERSATIONS WITH THEM, BUT THEY'RE NOT, YOU GUYS HAVE DONE WITH LDG AND OUR FOUR, I THINK AT LEAST FOUR DEALS IN THE LAST FOUR YEARS.
SO IT IS, BUT THERE'S JUST A GLOBAL THING THAT HAPPENS.
YEAH, I MEAN, I CAN TELL YOU THAT, YOU KNOW, IT'S SOMETHING THAT THEY'RE ALL CHATTING ABOUT OR COURSE NO DIFFERENT, BUT NO, NO PANIC SPECIFIC TO THIS DEAL.
UH, I THINK IF WE HAVE FUTURE DEALS COME UP, WHETHER THEY'RE A DEAL OR EVEN A DEAL THAT WE'VE DONE IN THE PAST AND, YOU KNOW, FUTURE TAX CREDIT DEALS, IT'S GONNA BE MORE PREVALENT, PART OF THE CONVERSATION.
BUT, UH, I, I WOULD CATEGORIZE DESPOKE OR ON THE TAXPAYER DEALS, BUT NOT OKAY.
IF SOMEONE WANTS TO DO A MOTION AND A SECOND THEN, UH, AND WE COULD HAVE ANY FURTHER DISCUSSION THAN ANYONE WANTS TO HAVE, BUT I THOUGHT GET IT.
DID ANYONE HAVE ANYTHING ELSE THAT THEY WANTED TO ASK? IT'S GOOD.
ALRIGHT, I'M GONNA GO THROUGH THE VOTE.
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DIRECTOR ALLEN, UH, I GUESS, UH, DIRECTOR ARD.UH, DIRECTOR MARSHALL C APPROVED.
THANK YOU TREASURER FARROW, DIRECTOR COLLINS APPROVE DIRECTOR HINTON APPROVE VICE PRESIDENT GARCIA APPROVE.
UH, NEXT ITEM IS THE RESOLUTION FOR PALLADIUM BUCKNER STATION, A MULTI-FAMILY RESIDENTIAL DEVELOPMENT TO BE LOCATED AT 4 0 1 SOUTH BUCKNER BOULEVARD, DALLAS, DALLAS COUNTY, TEXAS 7 5 2 1 7 A ADOPT, CONSIDER AND ADOPT A FINANCING RESOLUTION AUTHORIZING THE ISSUANCE, SALE AND DELIVERY OF THE CITY OF DALLAS HOUSING FINANCE CORPORATION, MULTI-FAMILY HOUSING REVENUE BONDS, PALLADIAN BUCKNER STATION SERIES 2025, AND THE PRINCIPAL AMOUNT NOT TO EXCEED $50 MILLION WITH THE PROCEEDS OF SUCH BONDS.
THE BUCKNER STATION BOND FINANCING TO BE LOAN TO PALLADIUM BUCKNER STATION LIMITED.
THE BUCKNER STATION BORROWER TO FINANCE A PORTION OF THE COST OF THE ACQUISITION CONSTRUCTION AND EQUIPPING OF PALLADIUM BUCKNER STATION.
A MULTI-FAMILY RESIDENTIAL DEVELOPMENT TO BE LOCATED AT 4 0 1 SOUTH BUCKNER BOULEVARD, DALLAS, DALLAS COUNTY, TEXAS 7 5 2 1 7.
THE BUCKNER STATION DEVELOPMENT.
AND B, CONSIDER AND ADOPT RESOLUTIONS APPROVING THE FORM AND SUBSTANCE OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF DOCUMENTS AND INSTRUMENTS NECESSARY TO CARRY OUT THE FINANCING AND OPERATION OF THE BUCKNER STATION DEVELOPMENT AND CONTAINING OTHER PROVISIONS RELATING TO SUCH DEVELOPMENT, INCLUDING RESOLUTIONS APPROVING THE GROUND LEASE BETWEEN THE BUCKNER STATION BORROWER AND DHFC BUCKNER STATION LANDOWNER, LLC, THE BUCKNER STATION, GROUND LESSOR AND PARTNERSHIP RESOLUTIONS AUTHORIZING THE ADMISSION OF DHFC BUCKNER STATION, G-P-L-L-C, THE BUCKNER STATION GENERAL PARTNER TO THE BUCKNER STATION.
BORROWER FINANCING FOR THE BUCKNER STATION DEVELOPMENT TO INCLUDE ONE, AN EQUITY INVESTMENT BY RAH INVESTOR 4 69 LLC TO THE BUCKNER STATION BORROWER.
TWO, THE BUCKNER STATION BOND FINANCING.
THREE, THE MORTGAGE FINANCING AND BRIDGE FINANCING BY REGIONS BANK TO THE BUCKNER STATION BORROWER.
AND FOUR, THE CITY OF DALLAS LOAN TO OCC LIVING AN ASSIGNMENT OF SUCH LOAN TO THE BUCKNER STATION BORROWER AND AUTHORIZING AND RATIFYING ACTIONS AND THE EXECUTION OF DOCUMENTS BY THE CORPORATION'S PRESIDENT, OTHER OFFICERS, GENERAL MANAGER AND ASSISTANT GENERAL MANAGER IN CONNECTION WITH THE REFERENCED TRANSACTIONS.
SO YES, SO THIS IS AGAIN, THE FINAL DOCUMENT FOR THE DEAL.
THIS IS A CITY, UM, I BELIEVE THEY'RE ALSO GETTING ECONOMIC DEVELOPMENT MONEY AS A WHOLE.
UM, STARTED BACK SEVERAL YEARS AGO, I THINK CHAD WEST WANTED, UH, THAT WAS EVEN CHALLENGE, I THINK.
SO THEY PUT OUT AN RB FOR ALL OF THESE DARK STATIONS TO HAVE PARTNERS WITH THEM AND IF THEY HAD EXCESS LAND WHERE THAT EXCESS LAND AND, AND TO I GUESS, FOCUS MORE DENSITY AROUND THESE STAR STATIONS TO ENCOURAGE SHIP.
ANYWAYS, UM, WE HAVE KIM AND TAYLOR HERE.
I THINK THAT YOU GUYS HAVE QUESTIONS ON THIS, BUT I THINK THIS IS THE FINAL THIRD ONE BEFORE APPROVAL.
AND I THINK THIS ONE IS, WHAT DID WE END UP FOR THE CLOSING DATE? MID-JULY.
UM, ANY QUESTIONS? OKAY, I'LL ENTERTAIN A MOTION AND A SECOND.
DIRECTOR ALLEN RUTH, DIRECTOR MARSHALL C APPROVE TREASURER PHARAOH, DIRECTOR COLLINS APPROVE DIRECTOR HEON APPROVE.
VICE PRESIDENT GARCIA APPROVE.
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PASSES ONTO ITEM NUMBER SEVEN.THIS IS OUR THIRD ONE, WHICH VERY EXCITING THAT WE COULD HAVE THREE NEW PROPERTIES UNDERWAY.
SO IF THIS ONE IS THE RESOLUTION FOR HIGHLINE ILLINOIS, A MULTI-FAMILY RESIDENTIAL DEVELOPMENT TO BE LOCATED AT 47 10 WEST ILLINOIS AVENUE, DALLAS, DALLAS COUNTY, TEXAS 7 5 2 1 1 A, CONSIDER AN ADOPTIVE FINANCING RESOLUTION AUTHORIZING THE ISSUANCE, SALE AND DELIVERY OF THE CITY OF DALLAS HOUSING FINANCE CORPORATION, MULTIFAMILY HOUSING REVENUE BONDS.
FANNIE MAE MBS SECURED HIGHLINE, ILLINOIS SERIES 2025 A AND THE CITY OF DALLAS HOUSING FINANCE CORPORATION, MULTIFAMILY HOUSING REVENUE BONDS, HIGHLINE, ILLINOIS SERIES 2025 B IN AN AGGREGATE PRINCIPLE AMOUNT NOT TO EXCEED $35 MILLION WITH THE PROCEEDS OF SUCH SUCH BONDS TOGETHER, THE HIGHLINE ILLINOIS BOND FINANCING TO BE LOANED TO TX ILLINOIS 2024.
LIMITED THE HIGHLINE ILLINOIS BORROWER TO FINANCE A PORTION OF THE COST OF THE ACQUISITION CONSTRUCTION AND EQUIPPING OF HIGHLINE, ILLINOIS.
A MULTIFAMILY RESIDENTIAL DEVELOPMENT TO BE LOCATED AT 47 10 WEST ILLINOIS AVENUE, DALLAS, DALLAS COUNTY, TEXAS 7 5 2 1 1 B.
CONSIDER AND ADOPT RESOLUTIONS APPROVING THE FORM AND SUBSTANCE OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF DOCUMENTS AND INSTRUMENTS NECESSARY TO CARRY OUT THE FINANCING AND OPERATION OF THE HIGHLINE ILLINOIS DEVELOPMENT AND CONTAINING OTHER PROVISIONS RELATING TO SUCH DEVELOPMENT, INCLUDING RESOLUTIONS APPROVING THE GROUND LEASE BETWEEN THE HIGHLINE, ILLINOIS BORROWER AND DHFC HIGHLINE, ILLINOIS LANDOWNER, LLC, THE HIGHLINE, ILLINOIS GROUND LESSOR AND PARTNERSHIP RESOLUTIONS AUTHORIZING THE ADMISSION OF DHFC, HIGHLINE ILLINOIS GP LLC, THE HIGHLINE ILLINOIS GENERAL PARTNER TO THE HIGHLINE, ILLINOIS.
BORROWER FINANCING FOR THE HIGHLINE ILLINOIS DEVELOPMENT TO INCLUDE ONE, AN EQUITY INVESTMENT BY CREA, HIGHLINE ILLINOIS, LLC TO THE HIGHLINE, ILLINOIS BORROWER TWO, THE HIGHLINE, ILLINOIS BO ILLINOIS BOND FINANCING.
THREE, THE CONSTRUCTION LOAN FINANCING BY CITIBANK AND A TO THE HIGHLINE, ILLINOIS.
BORROWER FIVE, THE CITY OF DALLAS HOME LOAN TO THE HIGHLINE, ILLINOIS BORROWER.
C-D-B-G-C-D-B-G LOAN TO THE HIGHLINE, ILLINOIS GROUND LESSOR.
AND THEN THE ASSIGNMENT OF SUCH LOAN TO THE HIGHLINE, ILLINOIS BORROWER AND AUTHORIZING AND RATIFYING ACTIONS AND THE EXECUTION OF DOCUMENTS BY THE CORPORATION'S PRESIDENT, OTHER OFFICER'S, GENERAL MANAGER AND ASSISTANT GENERAL MANAGER IN CONNECTION WITH THE ABOVE-REFERENCED TRANSACTIONS.
SO I'M PARTIAL TO THIS ONE BECAUSE I'M FROM ILLINOIS, EVEN THOUGH IT'S JUST THE STREET IN THIS INSTANT.
UM, SO, UH, DO WE HAVE ANY QUESTIONS? YEAH, THIS IS FINAL APPROVAL.
SO, AND THIS ONE I THINK IS THIS SCHEDULED TO CLOSE AT THE, AT THE END OF JULY? SO I THINK WE HAD CALLED THIS MORNING.
MAYBE, MAYBE WE'LL STILL HIT THAT.
BUT I THINK NOW THE, OKAY, SO ANOTHER ONE COMING RIGHT UP.
ALL OF OUR PROFESSIONAL ADVISORS HAVE BEEN QUITE BUSY, UM, AND WE THANK THEM FOR THEIR HARD WORK.
UH, SO I WILL ENTERTAIN A MOTION IN SECOND MOTION.
SECOND SECRETARY, PAGE SECOND.
DIRECTOR HINTON APPROVE VICE PRESIDENT.
OH, DID HE? HE ACCUSED HIMSELF.
DIRECTOR MOORE SECRETARY PAGE APPROVE.
UM, NOW WE'RE GOING TO, UH, HAVE A PRESENTATION THAT I'M DECIDED TO HEAR.
THIS IS, UM, ITEM NUMBER NINE, DISCUSSION OF POTENTIAL SINGLE FAMILY MORTGAGE BOND PROGRAM.
AND WE'RE GOING TO HAVE, UH, SOME REMARKS BY MIKE EARHART, THE MANAGING DIRECTOR OF STEEPLE NICHOLAS, THE COMPANY INCORPORATED.
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UM, OKAY.BOTH ARE ON SINGLE FAMILY MORTGAGES, BUT ITEM NUMBER EIGHT, THIS ONE I LOVE TO, BECAUSE THIS IS THE ONE WHERE, UH, WE ARE ALLOCATED BOND FUNDING, UM, FROM THE T-D-H-C-A AND UH, AND THEN WE ASSIGN IT BACK, UH, TO THE T-D-H-C-A SO THAT, UH, THE MONEY CAN BE USED TO MAKE LOANS FOR SINGLE FAMILY MORTGAGES.
UM, WE'VE HAD THAT PRESENTATION I THINK FROM THE T-D-H-C-A IN THE PAST.
AND, UM, AND THOSE ALLOCATIONS ARE DONE, I GUESS ACCORDING TO OUR PER CAPITA, UH, POPULATION, BUT SO THIS TIME IT'S $61 MILLION, WHICH IS WONDERFUL.
UM, SO ACTION ITEM RESOLUTIONS RELATING TO THE RENEWAL OF THE CORPORATION'S PARTICIPATION IN THE SINGLE FAMILY HOME MORTGAGE PROGRAM.
A CONSIDER AND ADOPT A RESOLUTION APPROVING AN ASSIGNMENT AGREEMENT WITH THE T-D-H-C-A AUTHORIZING THE T-D-H-C-A TO ISSUE BONDS FOR THE PURPOSE OF OBTAINING FUNDS TO FINANCE HOME MORTGAGE LOANS FOR PERSONS OF LOW AND MODERATE INCOME.
AND B, CONSIDER AN ADOPT A RESOLUTION APPROVING AN APPLICATION TO THE TEXAS BOND REVIEW BOARD FOR A SINGLE FAMILY PRIVATE ACTIVITY BOND ALLOCATION IN AMOUNT UP TO $61 MILLION AND APPROVING ALL OTHER MATTERS IN CONNECTION THEIR WAY.
SO ANYTHING ELSE TO ADD? WELL, I MEAN, SINCE PRESSURE, LIKE MARCY SAID, WE, WE'VE DONE THIS NOW THIS WE THE THIRD YEAR AT LEAST, THIRD MAYBE MORE, OR JORDAN PROBABLY KNOW
HE'S LIKE, WHAT?
BEST PART, WE DON'T REALLY HAVE TO DO ANYTHING
YOU KNOW, I THINK LAST I CHECKED THERE SOMEWHERE AROUND 300 POUND MONTHS THAT THEY HAD TO GROUP IN DALLAS PROGRAM.
UM, AND I THINK I, I BROUGHT THIS UP LAST YEAR TOO.
UM, CAN YOU TALK ABOUT HOW IS THIS PROGRAM PROMOTED TO, UM, AND SHOW ELIGIBLE APPLICANT, BUT THE D-V-H-C-A RUNS IT AND SO WHAT THEY DO IS, UM, THEY'RE TOLD THEY HAVE A NETWORK OF LENDERS, THE SCHOOL AND HOW TO GO BASED ON THE PRODUCT.
SO THEY TURN OUT A NETWORK OF REALTOR AS WELL AS FOR HOMES COMMEND THESE PROGRAMS TO THEM.
I MEAN, OBVIOUSLY IT'S WORKING BECAUSE I THINK EACH YEAR THEY USE SOLD MONEY.
SO I DUNNO, DO WE, UM, DO WE GET, OR DO WE HAVE THE ABILITY TO GET, UM, REPORTS THAT SHOW THAT GEOGRAPHIC DISPERSION OF THE UH, OF THE YEAH, THEY, THEY HAVE REPORTS.
THEY, THEY SHOW ZIP CODES THAT ALL THESE ARE TYPE FOUR TO TAKE A LOOK.
IT'S REALLY FUN TO SEE, YOU KNOW, WHAT THE LOAN SIZES ARE, WHERE THEY'VE BEEN DONE, AND, AND WHAT I THINK THE INCOMES OF THE FAMILIES THAT HAVE, UH, UTILIZED THE, THE FUNDS.
AND THEN DOUG, UM, HOW DOES IT INTERACT WITH THE DOWN PAYMENT ASSISTANCE? IN WHAT WAY? I THINK THAT SOME DOESN'T.
THOSE WHO ARE, THEY ALSO HAVE A DOWN PAYMENT ASSISTANCE PROGRAM THAT THEY PLAY ON TOP OF THIS YEAH.
AND I THINK THAT'S REALLY IMPORTANT, RIGHT? I'M SURE TO HELP THESE FAMILIES FOR SURE.
BECAUSE THAT'S, THAT'S A BIG BARRIER I THINK IS THAT, THAT DOWN PAYMENT.
SO GET THE VALUE OF ALL, UM, IN YOUR OPINION, WHEN YOU LOOK AT, SO YOU'VE LOOKED AT THE REPORTS AND SHOW THE GEOGRAPHIC DISPERSION BY I CODE, AND WHEN LOOKING AT THAT, DO YOU, DO YOU BELIEVE THAT THE LOANS ARE BEING EQUITABLY? ARE THEY KIND OF GOING WHERE YOU EXPECT 'EM TO GO BASED UPON THAT? NO, I THINK, YOU KNOW, I, I WOULDN'T SAY I'M, I'M NOT FOR SURE WHAT THE DISCUSSIONS, BUT IT'S, IT'S PRETTY MUCH ALL THROUGHOUT THE DALLAS.
YOU KNOW, IT'S NOT LIKE ONE AREA GETS ALL THE, IT'S CERTAINLY NOT THE HIGHER COST THAT DO BECAUSE THERE IS A, UH, A DOLLAR LIMIT, RIGHT? THE PRICE OF THE HOME BENEFIT PRICE.
THE, AND I'M NOT SAYING THERE IS, IN FACT I DON'T THINK THERE IS, BUT THE COMMON THEME IN MY QUESTIONS IS JUST PLUG TO ENSURES DIRECTLY THAT THAT, WELL THAT THIS PROGRAM IS BEING, YOU KNOW, WELL ADVERTISED AND THAT IT'S IN, THAT IN ITS IMPLEMENTATION, THAT IT'S, THAT PROCEEDS ARE BEING ALLOCATED EQUABLY AMONGST, YOU KNOW, THE POTENTIAL APPLICANT BASE.
[00:30:01]
FROM YOUR MONITORING THAT, THAT THAT IS THE CASE.SO YEAH, I MEAN AS, AS MUCH AS WE STEER, YOU KNOW, 'CAUSE PEOPLE, THEY DON'T WANNA BUY A HOME SOMEPLACE, BUT, UH, I THINK THEY CAN TAKE ANY NEIGHBORHOOD BALANCE THAT THERE ARE FOLKS WHO ARE WILLING TO BUY SO THEY QUALIFY.
THAT'S NOT, OR, UH, LIMITING BACK THERE, I THINK, I DON'T THINK IT HAS ANYTHING TO DO WITH HOW WE MARKET.
THIS TAKES A LITTLE MORE MONEY THEN THE PARTNER.
SO THOSE THINGS LIKE THE DOWN PAYMENT
SO I THINK THIS HAS BEEN VERY, VERY TOOL.
I REMEMBER WHEN WE TALKED LAST YEAR, THE PUSHING OF THE ADMINISTRATIVE BURDEN WAS A HUGE BENEFIT OF DOING IT.
IF WE'RE TALKING ABOUT DOING SOMETHING ON OUR OWN, IT'S GONNA AFFECT WHAT WE COULD POTENTIALLY PUT TOWARD THAT EFFORT OR WHAT'S THAT INTERPLAY KIND OF SKIPS AHEAD.
SO CURRENTLY THESE FUNDS, IT'S, IT'S NOT OUR PROPRIETARY HC FUNDS.
THIS IS JUST WHAT WE DO IS WE TAKE A BOND ALLOCATION, UH, WE HAVE UP TO 61 BILLION AND THEN WE CAN ALLOCATE THAT, RIGHT? AND THEN THEY CAN USE THAT, IT ADDS IT TO THEIR POOL NUMBER, BUT THEY HAVE ALL
NOW OUR NEXT, OUR NEXT ATION FROM HOW TO DEAL WITH WHAT IT MIGHT COST US TO DO THIS KIND OF ON OUR OWN.
UM, SO I GUESS WE'LL RESERVE THAT CONVERSATION FOR LATER.
BUT TO EFFECT YOUR QUESTION, THIS DOESN'T COST US ANYTHING LY ACCEPT, YOU KNOW? YEAH.
WHAT IMPACT WOULD WE, I I, WE'LL GET TO IT, BUT WOULD WE WANT TO ISSUE BONDS TO FUND OUR OWN PROGRAM RATHER THAN GETTING INTO TH INSTEAD OF USING OUR OUT OF POCKET FUNDS THAT WE
UM, SORRY, IT'S VERY HEAR HARD TO HEAR YOU GUYS.
I DON'T KNOW IF IT MIGHT HAVE SOME, OH, SORRY.
I KNOW WE DON'T HAVE MICROPHONES.
EVERYBODY TRY TO SPEAK LOUDLY.
GEORGE, DO YOU WANNA MAYBE, OR SHOULD WE WAIT UNTIL WE HAVE THE NEXT PRESENTATION? A NUMBER OF THE QUESTIONS WILL BE ANSWERED THE NEXT OKAY.
AT ONE POINT THAT'S WHAT I THINK.
QUESTION IS THAT THIS RESOLUTION IS FOR UP TO 61 MILLION AND THE DHSC IS LIMITED PURPOSES OF SINGLE FAMILY TO, AND IT'S, IT'S ON SIX TWO.
BUT FOR INSTANCE, IF YOU DO ANYTHING WITH T-D-H-C-A THEN LESSEN THE AMOUNT FOR 2025 YEAR THAT YOU COULD USE FOR YOUR OWN PROGRAM.
SO THAT'S NOT TO GET INTO OUR NEXT PRESENTATION, BUT THAT'S THE BOARD WILL NEED TO CONSIDER IS HOW WELL, BUT WHAT VICE PRESIDENT GARCIA WAS JUST SAYING, AND I DON'T NEED TO SPEAK FOR YOU FROM A TIMING PERSPECTIVE.
UM, I THINK OUR BONDS WILL RESET AT THE END OF THE 2025 BONDS.
WE COULD ESSENTIALLY GIVE TDHC THE ALLOCATION THROUGH NOVEMBER AND THEN WE CAN POTENTIALLY START OUR OWN PROGRAM IN 2026 WHEN WE HAVE A NEW ALLOCATION, CORRECT? MM-HMM
AND THEN THE TIME TO GET THE NEW, OUR PROGRAM SET UP.
ONE THING, D-D-H-C-A, THEIR PROGRAM WANTS YOU TO WAIT UNTIL LATER IN JULY.
IT'S LESS THAN 180 DAYS FROM THE END OF THE YEAR BECAUSE THEY WANT TO CARRY FORWARD THAT ALLOCATION.
UH, SO IN THAT SENSE, WE'RE REALLY LOOKING AT SOMETHING THAT DONE IN MID JULY AND THEN THE DHSC COULD STILL DO IT SOME PROGRAM, IF IT DOESN'T GIVE T-D-H-C-A ALL 60 MILLION MILLION IN 2025, THE 2025 CAP, BUT CARRY IT FORWARD TO 2026 OR YOU CAN APPLY THE LOTTERY IN, UM, IN THE OCTOBER LOTTERY AND 2026 PROGRAM STARTING FROM SCRATCH.
I'M SURE THAT QUESTIONS ARE ALL GONNA GET ANSWERED IN THE NEXT PRESENTATION.
CAN WE? SO YEAH, WHY DON'T WE, EVERYBODY OKAY WITH THAT, THAT WE'LL JUST WAIT TO VOTE ON WHATEVER AGENDA ITEM THIS IS AGENDA ITEM EIGHT UNTIL WE'VE HEARD THE PRESENTATION ON AGENDA ITEM NINE, RIGHT? YOU DON'T NECESSARILY HAVE TO DO THAT.
I THINK THIS GIVES YOU THE ABILITY TO ALLOCATE UP TWO SO YOU DON'T HAVE TO 61.
EITHER YOU WANNA DO THIS, WELL YOU DON'T, BUT YOU DON'T.
[00:35:01]
WE DO CHOOSE TO DO THE NEXT ITEM, YOU CAN STILL PRESERVE SOME OF IT.I'LL THANK YOU FOR THAT QUESTION.
IT'S, IT'S IN UP TO 61 MILLION.
SO LATER WE COULD SET AN AMOUNT UNDER THAT IF WE CHOSE TO DO SO.
WE'VE HAD CLIENTS DO THAT WHERE THEY PARTICIPATED, BUT THEY RESERVED PART OF THAT FOR THEIR OWN PROGRAM.
BECAUSE WE HAVE AND DO WE HAVE A DEADLINE? WE HAVE A DEADLINE TO SAY WE WANT TO PARTICIPATE.
IT'S, YOU HAVE A WINDOW FROM, IT'S THE FIRST WEEK IN AUGUST.
'CAUSE THERE WAS ACTUALLY THIS COLLAPSE IN A SINGLE FAMILY WITHIN T-D-H-C-A AND TA AND TAKE WHATEVER IS LEFT, TAKE CELLS, WE ALL TEAM COLLAPSE.
SO WE HAVE A FAIRLY NARROW AGENDA TO TAKE ACTION FOR YOUR UN LIKE AUGUST 6TH.
IS THAT DATE? DO WE NEED TO HAVE A SEPARATE BOARD ACTION? BUT IF YOU WANT TO DO, RIGHT, SO IT LOOKS LIKE WE HAVE RESOLUTION TO APPROVE AN APPLICATION AND WANT TO APPROVE AN ACTUAL ASSIGNMENT, RIGHT? THAT'S CORRECT.
DO WE, WE WOULD ONLY DO ONE FOR AN APPLICATION, WHICH DID WE EARN PAPER THAT, BUT NOT ACTUAL ASSIGNMENT OF WE WOULD STILL BE THE ASSIGNMENT, BUT THE ASSIGNMENT WOULD BE MODIFIED BASED ON HOW MUCH YOU WANT TO ASSIGN.
SO IT SEEMS LIKE THE PROTECTING LANGUAGE IS THE UP TO LANGUAGE, RIGHT? RIGHT.
AND THIS RESOLUTION ONLY AUTHORIZES ONE APPLICATION.
YOU HAVE TO DO TWO APPLICATIONS TO TAKE SOME MONEY FOR YOUR, OH, ACTUALLY, IF YOU SUM TO AN ITEM.
SO ARE YOU SAYING THAT ITEM A WOULD'VE TO READ, CONSIDER AND ADOPT A RESOLUTION APPROVING, UH, UH, ONE OR MORE ASSIGNMENT AGREEMENTS OR ONE ASSIGNMENT? HEY, SO THIS IS BRAXTON FROM HILLTOP.
I CAN KIND H DID BRAXTON WANNA SAY SOMETHING? YEAH, UH, I THINK I CAN KIND OF HELP A LITTLE BIT AS WELL SINCE WE'VE BEEN KIND OF HELPING A LOT OF OTHER HFCS WITH THE ASSIGNMENTS.
UM, SO I I THINK WE, WE WOULDN'T NEED ANOTHER RESOLUTION FOR THE TDHC ASSIGNMENT.
I THINK WHAT WE WOULD HAVE HERE WITH, WHICH I THINK GEORGE IS, IS, IS KIND OF, IS, IS EXPLAINING IS WE HAVE THE ONE RESOLUTION FOR THE 61 MILLION THAT WOULD BE FOR THAT APPLICATION THAT WOULD BE POTENTIALLY ASSIGNED TO T-D-H-C-A UP TO THAT 61 MILLION AMOUNT I BELIEVE.
UM, STIFEL PRESENTATION IS LOOKING AT A $25 MILLION BOND AMOUNT.
SO WE WOULD JUST, WE WOULD BE ABLE TO ASSIGN UP TO THE DIFFERENCE BETWEEN THAT 61 MILLION AND THE 2020 5 MILLION TO T-D-H-C-C-A.
BUT WE, WE DO NOT HAVE AN ACTION ITEM TODAY TO, TO DO AN INDUCEMENT FOR THE STIFEL, UH, PROGRAM.
THAT WOULD NEED TO BE DONE AT, AT THE PROBABLY JULY MEETING.
SO BRANCH, IT'S SO DECIDED BY BOARD.
BUT ARE YOU SAYING THAT THE WAY THAT THIS IS WORDED NOW, IF WE VOTE YES ON THIS MOTION THAT, UH, THAT THE WORDING WORKS, IF WE, IT'S NO KIDDING.
IT WILL ALSO STILL WORK IF WE DECIDE TO DO, UH, OUR OWN YES.
I THINK BECAUSE IT SAYS SAY UP TO I UP TO, YEAH.
DOES THAT ANSWER FOR YOU, DIRECTOR MOORE? UH, ANY OTHER QUESTIONS? ALL RIGHT, SO I NEED A MOTION AND A SECOND MOVE TO APPROVE THE RESOLUTION THAT'S WRITTEN.
UM, SO DIRECTOR ALLEN FAVOR, DIRECTOR MARSHALL C APPROVE.
TREASURER PHARAOH, DIRECTOR COLLINS IN FAVOR.
DIRECTOR HINTON APPROVE VICE PRESIDENT GARCIA APPROVE.
[00:40:01]
DIRECTOR ELLIS APPROVE.DIRECTOR MOORE APPROVE SECRETARY PAGE APPROVED AND DIRECTOR ZA APPROVE.
OKAY, NOW, NOW THAT I'VE GOTTEN IN THE CORRECT ORDER, ITEM NUMBER NINE, DISCUSSION OF POTENTIAL SINGLE FAMILY MORTGAGE BOND PROGRAM.
MIKE GERHART WITH STIFEL NICHOLAS.
UH, TODAY'S INFORMATION IS A PRESENTATION ONLY, NO ACTION ITEM.
SO WE ARE HERE TODAY TO TALK ABOUT WHAT, UH, LOCAL HFCS, ALONG WITH HOUSING FINANCE AGENCIES, WE'VE BEEN, UH, HAVING SUCCESS OF ISSUING TAX EXEMPT OR REVENUE BOND PROGRAMS FOR THEM TO HELP, UH, HOMEOWNERS HOME BUYERS IN THEIR AREA.
NOT ONLY CAN THEY DO MULTIFAMILY, BUT THEY CAN ALSO WORK ON SINGLE FAMILY SPACE.
AND SO THESE DOWN PAYMENT ASSISTANCE PROGRAMS USED WITH THE TAX EXEMPT REVENUE BOND PROVIDE BELOW MARKET INTEREST RATES ALONG WITH DOWN PAYMENT ASSISTANCE.
YOU CAN STRUCTURE IN MANY DIFFERENT MANNERS, THREE, FOUR OR 5% OF DOWN PAYMENT ASSISTANCE.
BUT WE'VE BEEN USING, UH, THREE AND A HALF IN A LOT OF THE PROGRAMS THAT I WORK ON.
AND WE'VE HAD GREAT SUCCESS IN, UH, TULSA COUNTY, OKLAHOMA, ALONG WITH CLEVELAND COUNTY, WHERE NORMAN IS TALKING ABOUT WHAT A, A TYPICAL PROGRAM LOOKS LIKE.
AND THEN THE LAST FEW PAGES IN THE BACK IS A CASHFLOW SUMMARY REPORT SHOWED WHAT THE ACTUAL NUMBERS LIKE.
SO VERY BRIEF ON PAGE ONE THERE, WHAT YOU SEE AS A TYPICAL PROGRAM, WE, YOU'RE GONNA HAVE TO SIT DOWN A PAYMENT AND CLOSING COST ASSISTANCE.
THE PRODUCTS WE'RE USED AT FHA VA, USDA AND THEN YOUR TYPICAL BORROWERS.
THOSE ARE YOUR, YOUR MUNICIPAL EMPLOYEES, YOUR FIRST FIRST RESPONDERS, LAW ENFORCEMENT NURSES.
AND IT'S NOT GONNA BE LIMITED TO THOSE OCCUPATIONS, BUT IT JUST GIVES YOU A SENSE OF WHO THEY ARE EVERY YEAR.
HUD UH, CHANGES THE INCOME LIMITS, WHICH CHANGED APRIL 1ST.
AND YOU CAN SEE THERE THE INCOME LIMITS FOR TARGETED NON-TARGETED AREAS DEPENDING ON HOUSEHOLD SIZE.
AND THEN A QUICK MARKET COMPARISON FROM THIS WEEK, LOOKING TO SEE WHERE YOUR CURRENT STATE PROGRAM IS.
UH, THAT USES A 30 YEAR ALWAYS REPAYABLE SECOND LIEN.
THE ASSISTANCE MUST BE REPAID FOR 30 YEARS.
AND ALONG WITH WHAT A, UH, IN RECENT INDICATION THAT WE PUT TOGETHER A 6.48 INTEREST RATE TO THE BORROWER, UH, USING A GRANT, WHICH WE'VE DISCUSSED WITH YOUR, UH, FA SO FAR.
AND IT'S, IT'S REALLY UP TO THE BOARD AND HOW YOU WANNA STRUCTURE THAT, WHETHER IT'S A GRANT OR
BUT RIGHT NOW IT'S MODELED AS A GRAINER.
AND THEN I GAVE YOU SOME INFORMATION WHAT YOUR DALLAS REAL ESTATE MARKET LOOKS LIKE OF WHAT, UH, HOMES THAT WERE FOR SALE, APPROXIMATELY 2,600 HOMES FOR SALE PRESENTLY ON JUNE 2ND.
AND THEN LAST YEAR WE PULLED DATA TO SHOW 30,000 HOMES IN THE CITY LIMITS OF DALLAS.
SOLD USING A MORTGAGE LAST YEAR.
UM, IN A TYPICAL STRUCTURE, ABOUT $25 MILLION MORTGAGE REVENUE BOND TRANSACTION.
UM, JUST DEPENDING WHERE YOU ARE, DALLAS HAS THOSE PRICES THAT YOUR, YOUR AVERAGE LOAN SIZE CALCULATED OUT LAST YEAR.
414,000 WAS AN AVERAGE, BUT IN THE AFFORDABLE LENDING SECTOR FOR DELMONT BORROWER, IT'S NOT GOING TO BE THAT HIGH.
BUT THAT'S WHAT YOUR AVERAGE WAS BASED UPON THE DATA THAT WE PULLED FOR 2024.
AND YOU CAN SEE THERE USING THAT NUMBER FOUR 14 WOULD BE ABOUT 61 HOME LOANS TO USE ALL THE ON PROCEED, WE, YOU WOULD EXPECT THE LMI BAR WOULD BE BUYING MUCH LOWER FOUR 14.
NEXT PAGE IS JUST YOUR AREA DEMAND.
WE'VE SEEN OTHER, UH, PROGRAMS THAT WERE MENTIONED EARLIER BY MR. RODRIGUEZ.
UH, WE CAN SEE WHAT THEY HAVE FUNDED IN, IN THEIR PROGRAMS. AND SO RIGHT NOW WE'RE SHOWING, UH, DURING 2024 WAS ABOUT 203 MILLION OF USING DOWN PAYMENT ASSISTANCE PROGRAMS ONLY.
AND SO JUST KIND OF GIVE YOU AN IDEA OF WHAT IS GOING ON IN THE SPACE AT DPA.
A A LOT OF, UH, FOLKS THAT I SEE AT HOUSING FINANCE AGENCIES, WHEN THEY'RE REVIVING THE BOND PROGRAM ASKS, WELL, IS THERE EVEN DEMAND FOR THIS? AND YOU CAN SEE RIGHT THERE, THERE'S DEMAND FOR IT.
WE HAVE WORKED WITH ONE OF YOUR NEIGHBORING HFCS IN DIFFERENT COUNTIES, UH, SOUTH EAST AND WEST OF DALLAS.
AND, UH, WE DID COMPLETE A LENDER DEMAND SURVEY WITH THEM BASED UPON THEM AUTHORIZING US TO DO SO.
AND IN THOSE JURISDICTION, THOSE AREAS, WE SAW THAT THE DEMAND WAS HIGHER THAN 2,500 BOND TRANSACTION.
UM, WE WENT BACK AND DID A LITTLE RESEARCH JUST TO SEE WHEN WAS THE LAST TIME YOU ALL DID TAXES THAT BOND PROGRAM? AND THERE YOU HAVE THE DATA.
THIS IS WHAT WE WERE ABLE TO PULL FROM EMMA, WAS YOUR SERIES IN, IN 2006, TWO THOUSAND FOURTEEN THOUSAND TWO.
UM, EVERY TIME I COME AND AND TALK ABOUT THE INITIAL PRESENTATION, EVERYBODY WANTS TO KNOW WHAT DOES THE SCHEDULE LOOK LIKE? AND SO THAT IS AN EXTREMELY ROUGH DRAFT STEPS OF THE APPROVAL APPROVAL PROCESS.
[00:45:01]
ROUGH.AND THAT IS A QUESTION THAT ALWAYS COMES UP.
SO WE MIGHT PROVIDE IT THE FIRST TIME.
HERE'S WHERE IT KIND OF LOOKS LIKE, UM, YOUR NEXT, UH, WAS POTENTIAL POTENTIAL PROGRAM ROLES.
WE PUT TOGETHER, UH, YOURSELF AS A SPONSOR IN YOUR ENTIRE FINANCING TEAM.
UH, WE WORK WITH MANY DIFFERENT RS, UH, US BANK, LAND HOME GATEWAY USES.
AND SO WE'VE BEEN HAVING SUCCESS WITH LAND FINANCIAL SERVICES AS A SERVICER FOR LOCAL HOUSING FINANCE AGENCIES.
UH, CERTAIN RS DO CHOOSE, UH, NOT TO BE A SERVICER FOR LOCALS AND LANDOWNERS WILLING TO DO SO AND UH, IS WILLING TO.
UM, IF YOU SKIP ON BACK, WHAT I DO WANT TO COVER WITH YOU ALL AND UH, BRAXTON AND TIM MAY HAVE SOMETHING TO, UH, TO CHIME IN ON THE CASH FLOW SUMMARY REPORT.
I'M ON, UH, BOTTOM OF THE RIGHT HAND CORNER SHOWS PAGE ONE OF FIVE PAGES.
AND THEN ON THAT PAGE YOU CAN SEE THERE WHAT THIS IS A CASH FLOW SUMMARY REPORT.
IT SHOWS A FULL SPREAD LOAN RATE, BUT THAT MEANS THAT'S A FAR NOTE RATE.
WHEN WE LOOKED AT THIS ON JUNE 9TH, YESTERDAY, YOU SEE THEIR 6.48 NOTE RATE AND THAT IS WITH THREE AND A HALF POINTS OF DOWN PAYMENT CLOSING COST ASSISTANCE BY HOME BUYER.
AND THAT COMPARED OVER TO YOUR MARKET RATE FHA LOAN SIX AND A HALF WITHOUT ASSISTANCE.
SO IF A LENDER'S GONNA BE DOING A LOAN IN THE MARKET TODAY IN DALLAS WITHOUT IT OUTSIDE OF YOUR PROGRAM, THEY'RE GONNA PUT THEIR OWN THREE AND HALF PERCENT DOWN THERE WHERE THE MARKET WAS SIX AND A HALF.
UH, YESTERDAY WHEN WE LOOKED AT IT, THE NEXT PAGE YOU TALK ABOUT IS THE SOURCES AND USES.
THERE YOU SEE THE ISSUER INVESTMENT THERE.
AND IN THESE STRUCTURES IT DOES REQUIRE AN ISSUER INVESTMENT.
YOU SEE THAT THERE 1.335 MILLION THAT'S HIGHLIGHTED THE TOP AND THAT NEXT HIGHLIGHTED LINE BREAKS DOWN WHERE THAT MONEY GOES.
AND I WANT TO TALK ABOUT THAT BRIEFLY COLUMN THAT YOU SEE THERE.
WHAT MOODY'S REQUIRES AS A RATING AGENCY IS TO FULLY, UH, FUND THE INTEREST IN A ONE OF THEIR MANY WORST CASE SCENARIO.
STRESS TEST IS WANTING TO KNOW WHAT IF ALL THE MORTGAGE BACK SECURITIES ARE NOT DELIVERED UNTIL THE VERY LAST DAY OF THE ORIGINATION PERIOD.
YOU, YOU SET IT FOR INSTANCE SEPTEMBER 1ST, YOUR ORIGINATION PERIOD ENDS DECEMBER 31ST.
WHAT IF THE WORST CASE SCENARIO, THEY ALL GET DELIVERED ON THE VERY LAST DAY.
MOODY WANTS TO CAPITALIZE THE INTEREST ACCOUNTS, MAKE SURE THERE'S ENOUGH INTEREST IN IT, MAKE THE, UH, INTEREST PAYMENTS.
AND SO THAT THAT YOU SEE THERE IS YOUR CAP ACCOUNT.
THE COST OF ISSUANCE ACCOUNT IMMEDIATELY TO THE LEFT LENDER COMPENSATION, THE DOWN PAYMENT ASSISTANCE ACCOUNT, YOU LOOK AT THAT COLUMN DPA ACCOUNT YOU SEE THERE THAT THE BOND PREMIUM IS PAYING, UH, UNDER THIS SCENARIO A LARGER, THE LARGEST AMOUNT OF THE DOWN PAYMENT ASSISTANCE.
'CAUSE THERE IS ABLE, RIGHT NOW IN TODAY'S MARKET, IT WOULD BE ABLE TO RAISE BOND PREMIUM WITH A PREMIUM BACK BOND AND THAT CAN BE USED TO FUND THE DOWN PAYMENT SYSTEMS
UM, WE WENT BACK, IF I MAY, TO THE VERY LAST PAGE, PAGE FIVE OF FIVE.
AND WHAT THIS IS, IS A PAGE TO DOCUMENT AND SHOW UNDER A, UH, PREPAYMENT SPEED OF 100%, WHAT ARE THE RETURNS OF THE ISSUER.
AND SO WHY, UH, LOCAL HFAS WERE CREATED AND LOCAL HFAS CREATED TO WORK IN THE SINGLE FAMILY HOME OWNERSHIP SPACE AND ALSO THE MULTIFAMILY DEVELOPMENT SPACE IS BECAUSE YOU CAN PUT THESE PROGRAMS TOGETHER AND THEY PROVIDE VALUE TO THE ORGANIZATION LONG TERM OVER A LONG PERIOD OF TIME.
AND SO IF INDEED, UH, WERE TO, UH, MAKE THAT, UH, ISSUE A CONTRIBUTION OF 1.335 MILLION UNDER THESE ASSUMPTIONS AT A 100% PREPAYMENT SPEED ANALYSIS, WHAT YOU CAN SEE THERE IS THAT MONEY COMES BACK TO THE AGENCY OVER TIME.
THAT'S WHAT WE'RE JUST TALKING ABOUT AS A CAPITAL LOSS INTEREST.
IF THE LOANS ARE ORIGINATED, ACCORDING THE SCHEDULE AND EQUAL EQUALS, UM, INCREMENTS OVER A FIVE TO SIX MONTH PERIOD AND THE MORTGAGE BACK SECURES ARE POOL POOLED ACCORDINGLY, WHAT YOU WILL SEE THERE IS THE CAP.
I WILL BE RELEASED A PORTION THEREOF AND RELEASED BACK TO THIS AGENCY THROUGH YOUR TRUSTEE.
YOU CAN SEE THAT ITEM THERE DECEMBER OF 2026.
AND THAT'S IF THE LOANS ORIGINATE UNDER THESE ASSUMPTIONS IN THAT SCHEDULE AND, UH, FULLY PUT INTO MORTGAGE BACK SECURITIES BY THE END OF THE, UH, ORIGINATION PERIOD.
CONS, UH, CERTIFICATE PURCHASE PERIOD.
SO I'VE SAID A LOT OF INFORMATION TODAY.
WE WANTED TO COME JUST PROVIDE YOU A LOT OF INFORMATION FOR YOU ALL TO THINK ABOUT AND DECIDE LATER ON IF THAT'S SOMETHING YOU ALL WOULD LIKE TO PURSUE.
WE'VE HAD, UH, LOCAL TEXAS HOUSING FINANCE CORPORATIONS LOOKING AT THIS THIS YEAR.
AND SO WE ARE EXECUTING THESE AND OTHER COUNTIES OUTSIDE OF THE STATE OF TEXAS.
I DO KNOW, I BELIEVE EL PASO ISSUED A MONTHS EARLIER THIS YEAR AS WELL WITH, WITH SOMEONE ELSE.
AND SO I'M GONNA PAUSE HERE AND TAKE ANY QUESTIONS.
UM, CAN YOU EXPLAIN FOR US HOW THE INTEREST RATE, UM,
[00:50:02]
UH, YOU KNOW, WHAT THE RISK IS? THE INTEREST RATE RISK? YES.WHAT IS THE INTEREST RATE RISK? THE INTEREST RATE RISK IS WHEN YOU TAKE OUT A BOND TRANSACTION, YOU CLOSE, YOUR RATE IS FIXED.
SO LET'S SAY YOUR BOND, YOUR COST OF FUNDS IS, UH, IS UH, 4.8 AND YOUR NOTE RATE IS SIX POINT, UH, UH, FOUR, EIGHT.
AND YOU'RE GONNA USE THE DELTA TO SERVICE YOUR BOND DEBTS.
WELL, THAT'S FIXED, RIGHT? WITH THE FEDERAL RESERVE OR THE FEDERAL MARKETING COMMITTEE WERE TO COME IN AND START CUTTING INTEREST RATES.
AND RIGHT NOW WHERE THAT SIX AND A HALF IS, ALL OF A SUDDEN IT GOT TO A A A SIX AND THEN TO A FIVE AND A HALF INTO A FIVE.
THAT'S A RISK THAT YOU ALL WOULD HAVE IS YOU TOOK OUT BOND MONEY, YOU HAVE A FIXED PERIOD THERE.
AND ONE WAY TO, TO HELP ALLEVIATE SOME OF THAT RISK IS TO MARKET THESE HEAVILY IN ADVANCE OF THE BOND PRICING MARKET, THE PROGRAM HEAVILY TO LENDERS.
AND, UH, ONCE AN HFC AUTHORIZES US ALONG YOUR SERVICER TO DO THAT, WE GO SIGN UP THESE, THESE LENDERS AND WE WE EDUCATE THOSE REALTORS IN ADVANCE.
HERE'S WHAT'S COMING ON SUCH AND SUCH DATE, AND THIS IS WHAT THE INDICATIONS LOOK LIKE.
THEY LOOK LIKE A 6.4 PAGE NO RATE.
AND OH, BY THE WAY, THIS IS NOT A 30 YEAR SECOND LIEN ON YOUR HOUSE FOR $10,000 INTO GRANTS.
AND THAT ATTRACTS LENDERS TO USE THAT MONEY A MUCH FASTER VELOCITY THAN HAVING A SECOND LIEN FOR 30 YEARS TOO.
SO THE RISK IS AS YOU TAKE OUT BOND DEBT, AND IF THE FONC WERE TO COME IN AND CUT RATES VERY RAPIDLY, VERY QUICKLY, THAT WOULD BE AN ISSUE.
BUT YOURS IS A GRANT OF ASSISTANCE.
SO THERE'S NO SECOND LIE BURDEN.
HOW MUCH LESS DESIRABLE IS IT IF IT'S A, IF IT IS A LE INSTEAD OF A GRANT, HOW MUCH LESS DESIRABLE IS IT IF IT'S LIEN GRANT? WE'VE HAD SUCCESS IN OTHER, OTHER COUNTIES AND OTHER STATES DOING A FIVE YEAR FORGIVABLE.
AND SO WHAT THAT MEANS IS AT THE END OF THE FIVE YEARS, THE IS FORGIVEN SO THAT THAT BAR NO LONGER PAYS, BUT THEY STAY AS THAT HOMEOWNER STAY IN THE HOME.
MARKETING ABILITY, HOW MUCH LESS DESIRABLE? UH, WE HAVE HAD THOSE, THOSE ORIGINATE JUST FINE AND FULLY ORIGINATE BY THE END OF THE ORIGINATION PERIOD FULL ANTICIPATED.
UH, WITH HAVING A FIVE YEAR, UH, WE HAVE, UH, FOLKS THAT HAD SINGLE FAMILY TAXABLE TPA PROGRAMS IN OTHER STATES UP AND RUNNING AND WHEN THEY'VE ISSUED ONE OF THESE TRANSACTIONS, THE FIRST ONE TAKES TWO MONTHS TO FULLY ORIGINATE.
BUT SUBSEQUENTLY IN 23 OR 24 25 BEGINNING, ORIGINATING IN CERTIFICATE LOT QUICKER POSSIBLY.
BUT THIS IS YOUR FIRST STEP IN GETTING BACK INTO MARKETING.
UH, TALK ABOUT INTEREST RATE RISK.
IF WE DON'T BORROW MONEY AND THEN INTEREST RATES GO DOWN, CAN WE ALSO PURCHASE AND THE DER BASED WAY OF, OF MITIGATING THAT RISK INDUSTRY? YEAH, SO I WOULD DEFER THAT TO YOUR FINANCIAL ADVISOR.
IF THEY'RE TALKING ABOUT PURCHASING A DERIVATIVE OF, OF WANTING TO DO THAT, THAT WOULD BE MORE THE, THE FA ARENA OF TO FALSE OFFSET THAT RISK.
UH, WE WOULD BE AS, AS A BROKER DEAL, SELL THE BONDS AND THEN ALSO MARKETING THE PROGRAM.
UH, WE STAY WITH THE PROGRAM AND SO WHAT WE DO IS MAKE SURE WELL IN ADVANCE BEFORE WE HAVE A GOOD PRICE BONDS, WE WANT BETWEEN SEVEN AND EIGHT OF THESE LENDERS WHO HAVE EXECUTED DOCUMENTS PROGRAM LENDER AGREEMENT, UM, AND ALSO MAKING SURE THAT THAT THEY ARE FULLY EDUCATED AND READY TO GO.
THAT WHEN WE DO PRICE BONDS, THE MONEY GOES OUT THE DOOR AS USED.
SO, UH, I DON'T KNOW IF IF THEY WANTED TO COMMENT ON ANY, ANY, UH, DERIVATIVES OF, OF OFFSETTING RISKS.
WELL THAT AND WHETHER, UM, WE'RE EVEN ALLOWED TO DO THAT
YEAH, AND YOU CAN, YOU CAN INVEST YOUR, YOUR FUNDS.
THEY'RE SUBJECT TO FEDERAL TAX RULES.
UM, THEY'RE ALSO SUBJECT TO, UM, YOU, YOU KNOW, WHAT THE RATING AGENCY WILL ACCEPT AS AN INVESTMENT FOR THE BONDS.
SO IN TERMS OF DERIVATIVES, ONE OF THE HISTORICAL INVESTMENTS FOR THESE HAS BEEN WHAT WE CALL GUARANTEED INVESTMENT CONTRACTS.
UM, OR BASICALLY DEPOSITED WITH A BANK.
USUALLY THEY'RE 10, THE BIGGEST PLAYERS IN THAT MARKET TENDED TO BE LIKE FOREIGN BANKS.
THEY GIVE YOU A RATE, YOU DRAW THE MONEY OUT WHEN, WHEN YOU NEED IT SUBJECT TO CERTAIN CONDITIONS.
YOU KNOW, THAT MARKET HAS HAD BITS AND STARTS.
UM, IT'S COME BACK A LITTLE BIT, BUT, UM, A BIT TRICKY FOR SINGLE FAMILY DEAL JUST 'CAUSE THERE'S VARIABILITY ON WHERE AND, AND A LOT OF BANKS KIND OF GOT, UH, IN A BAD PLACE, UH, BACK IN OH EIGHT WHEN THIS MARKET WAS DRIVING AND WAS.
UM, BUT YEAH, I MEAN LONG STORY SHORT, YOU CAN INVEST YOUR MONEY AND WILL INVEST YOUR MONEY.
[00:55:01]
YOU RATING AGENCY IS GOING TO WANNA SEE THAT INVESTED, UM, INTO WHAT IS A DISCUSSION TO BE HAD.FORGIVE ME IF I DIDN'T UNDERSTAND YOUR QUESTION.
IF YOU LOOK AT PAGE FOUR FIVE, WHAT YOU DO SEE IS STATE AND RULE GOVERNMENT SECURITIES LABELED AS SLG.
AND SO THIS PARTICULAR SCENARIO DOES, DOES, UH, ANTICIPATE YOU PARKING SOME MONEY IN THERE IN UNDER THESE ASSUMPTIONS INTO STATE LOCAL GOVERNMENT SECURITIES THAT ARE ONLY ALLOWED UH, BY, BY STA STATE STATUTE FEDERAL STATUTE IN CONJUNCTION WITH UFA.
AND YOU CAN SEE THERE, WE JUST TOOK IN A LOOK A SNAPSHOT TO SEE WHAT THOSE STATE LOCAL GOVERNMENT SECURITIES WERE PAYING.
YOU CAN SEE THERE A 4.4% INTEREST RATES.
SO PARKING SOME OF THOSE FUNDS, UH, UNDER THE ADVICE OF YOUR F FA MAKING SURE THAT YOU GET THOSE INTO THOSE, THOSE SLOPES.
UM, THEN IN YOUR BASE CASE SCENARIO HERE, IT LOOKS LIKE WE DID A $25 MILLION PROGRAM.
WE'RE INVESTING 1.3 MILLION AND THEN EVERYTHING GOES ACCORDING TO PLAN.
WE SHOULD GET BACK ABOUT HALF A MILLION PRETTY QUICKLY.
SO THEN WE'VE GOT LIKE A NET OF 800,000 IN THERE AND WE GET SOME RETURN ON THAT BACK AND FORM OF ISSUER FEES LOOKS LIKE OVER PERIOD ABOUT 2050.
AND THEN, UM, THEN THERE'S CASH FLOW RESIDUALS AFTER THAT.
SO THAT'S WHERE THE RETURNS ON THE 800.
SO STICK LOOK PAGE FIVE TO FIVE.
PAGE FIVE TO FIVE AND THAT THAT'S HIGHLIGHTED.
AND YOU CAN SEE THERE, I HIGHLIGHTED THAT LINE SHOWS THAT SUB TOTAL RETURN FOR THE HFC OVER A LONG PERIOD OF TIME, 3.572 MILLION.
AND THEN WE WANTED TO PD THAT BACKWARDS USING A 4% INTEREST RATE.
'CAUSE IF YOU MADE 1.335 IS YOUR CONTRIBUTION, WHAT DOES THAT MEAN IN A PRESENT VALUE SCENARIO? AND THAT IS 1.77 MILLION UNDER THESE ASSUMPTIONS IN SCENARIO.
DID YOU RUN A IR CALCULATION ON THAT TOO, YOUR HONOR? I DID NOT.
THAT'S SIR, I HAVE A KIND OF GET FORWARD QUESTION IN TERMS OF THE STATE, UH, OFFERING.
ARE THEY LIMITED IN THE TERMS THAT THEY'RE USING? AND IF THEY ARE, IS THIS A WAY FOR US TO BE ABLE TO OFFER BETTER TERMS IF THEY'RE NOT, WHY ARE, ARE THEY JUST MORE RISK AVERSE THAN WE WOULD BE? HOW CAN WE OFFER SOMETHING MORE COMPETITIVE? SURE, SURE.
I I, I, I CAN'T SPEAK TO WHAT THEIR STRUCTURE LOOKS LIKE, BUT THEY MAY HAVE INTERNAL HIGH RR GOALS THAT ARE DIFFERENT.
YOU SEE, UH, HOW CAN YOU, HOW CAN YOU, UH, DO A DIFFERENT, MAYBE THEY'RE NOT RAISING PREMIUM PAC BONDS, THAT'S IN THE STRUCTURE THAT'S ON YOUR PAGE OR, UH, EXCUSE THAT'S ON ACTUALLY THREE OF FIVE PREMIUM PAC BOND.
HOW, HOW THEY'RE THEIR, UH, INTERNAL METRICS ARE HOW THEY'D LIKE TO SET UP THEIR CURRENT ARRIVE WITH THAT.
I, I HAVE WATCHED THEIR, UH, THEIR WEBSITE AND I NOTICED THE RATE CHANGES, UH, ON A DAILY BASIS.
IT COULD BE AN OPEN INDENTURE THAT THEY MIGHT BE RUNNING.
I DON'T KNOW, IT MIGHT BE WHAT IT IS WHERE THEY'RE, THEY'RE HAVING A LOT OF ASSETS THAT HAVE BUILT UP IN THAT INDENTURE OVER TIME.
THIS WOULD BE A CLOSED INDENTURE.
CAN YOU WALK ME THROUGH THE TIMELINE OF THE APPROVAL AGAIN? UM, THIS WOULD BE AGAIN FOR AN ALLOCATION OF 20 OF OUR 2025 ALLOCATION.
SO WE WILL OPERATE AT WHATEVER SPEED YOU WOULD LIKE TO OPERATE.
IF YOU'D LIKE TO DO IT THIS YEAR, THAT'S GREAT.
AND IF YOU WANT TO DO IT NEXT YEAR, THAT'S FINE TOO.
UM, AS FAR AS ALLOCATING VOLUME CAP, WE HAVE THAT SUCCESS, GETTING THE VOLUME CAP APPROVED AT ANY TIME OF THE YEAR.
SO SPECIFICALLY TO WHAT YOUR STATE BOND REVIEW BOARD, UH, POLICIES ARE, REGARD DATES COLLAPSING.
THE POOLS I KNOW GRANT NOT A LONG TIME WELL VERSED ON WHEN THOSE TOOLS COLLAPSE.
I'VE HEARD, UH, SEPTEMBER 1ST, SEPTEMBER 2ND.
BUT WE WILL DO IT AT WHATEVER SPEED YOU ALL WOULD LIKE.
DO YOU WANNA GET IT DONE THIS YEAR? GREAT.
IF NOT, YOU WANT, UH, IT'S CALLED UH, TEE GET READY FOR NEXT YEAR.
JUST WE WANTED TO MAKE SURE YOU WERE AWARE OF, UH, LOCAL H FFA TO BE BACK INTO THE TAX EXEMPT
SO, BUT I THINK, AND GEORGE CORRECT ME IF I'M WRONG, I THINK THE DECISION POINT IS IF, IF YOU WANT TO RESERVE 2025 CAP, UM, THAT DECISION KIND OF NEEDS TO BE MADE AFTER JULY MEETING.
SO YOU CAN ALLOCATE BETWEEN AN ASSIGNMENT WITH THE THCA AND KEEPING SOME FOR YOURSELF BEFORE THAT AUGUST SINCE, UM, YEAH, CORRECT.
THIS IS BRAD TO, UM, I JUST WANTED TO TO ALSO MENTION THAT PART, PART OF THE THINKING ON THE VOLUME CAP REQUEST IS, UH, THE UTILIZATION PERCENTAGE, UH, FOR THE HFC PER, PER THE
[01:00:01]
LAST PROGRAM, WHICH WE WOULD STILL BE SUBJECT TO, WE HAVE AROUND A 40% UTILIZATION PERCENTAGE.SO WE, WE WOULD HAVE THAT PENALTY IF WE GO IN, UH, FOR A, A, A LOTTERY APPLICATION, UM, OR, OR ANY TYPE OF APPLICATION PRIOR TO JULY 16TH.
SO PART OF THE THINKING IS IF WE, IF WE GO IN, YOU KNOW, THIS SUMMER AFTER JULY 16TH AND WE WOULDN'T BE SUBJECT TO THE UTILIZATION PENALTY AND, AND WE COULD GO IN FOR THE 25 WITHOUT HAVING TO OVER INDUCE, UH, UH, OR, OR YOU KNOW, WE JUST WOULDN'T, WE WOULDN'T HAVE THE UTILIZATION PENALTY, UH, TO, TO, TO KIND OF FACTOR IN TO OUR, OUR BOND SIZING.
UM, IN WHICH THAT'S, THAT'S WHERE I WAS KIND OF GETTING INTO PREVIOUSLY WHEN, WHEN, UH, WE WERE SPEAKING ABOUT THE TDHC ASSIGNMENT IN WHICH WE WOULD NEED TO LOWER THAT REQUEST FROM THE 61 MILLION TO, TO FACTOR IN THE, THE AMOUNT THAT WE WOULD NEED FOR THESE BONDS, WHICH I THINK MIKE, YOU ALSO HAVE IN A, A BIT OF A, A PREMIUM THERE.
SO WE WOULD LIKELY NEED TO COME IN AROUND 26 ISH MILLION DOLLARS 'CAUSE THAT WOULD BE SUBJECT TO VOLUME CAP AS WELL.
IS THERE ANY RISK THEN, UM, TO KIND OF, BASED ON THE DATES GEORGE JUST THROWN OUT EARLIER THAT WE MAY LOSE SOME OF THE 61 BECAUSE AT ITS CURRENT STATE, ALL 61 CAN GO TO DALLAS RESIDENCE.
I MEAN IF WE DON'T, IF WE DON'T CLOSE ANY, UH, IF WE DON'T CLOSE THIS TRANSACTION ON THE, ON THE CURRENT TIMELINE, LIKE WE WOULD GET 210 DAYS TO CLOSE ONCE RECEIVED, WE WOULD, IT WOULD BE DESIGNATED AS CARRY FORWARD AT THE BEGINNING OF THE YEAR AND THEN WE WOULD STILL HAVE CONTROL AS DALLAS HC FOR THREE CALENDAR YEARS, UH, TO MOVE FORWARD WITH OUR OWN PROGRAM.
IT COULD ONLY BE USED FOR SINGLE BAND BOY OR MC.
OH, SO BUT WE'VE HAD GOOD DEMAND.
LIKE YOU'RE TALKING ABOUT THE, LET'S, IF WE DO SOME OF THIS THEN, UH, THEN WHAT WE DO WITH THE TDHD, WHAT WE ASSIGN IS WHAT YOU WERE SAYING, RYAN, THAT, THAT, THAT AMOUNT NO, WHAT YOU ASSIGN OUT, THAT'S WHAT YOU ASSIGN.
THEY'RE GONNA TAKE THAT CAP AND THEY'RE GONNA DO
SINGLE FAMILY, THEY'RE GONNA USE IT FOR SINGLE FAMILY.
THAT'S ALL THEY CAN USE FOR, RIGHT.
IF YOU WERE TO TAKE, CALL IT TWENTY FIVE, TWENTY SIX 7 MILLION FOR A DALLAS PROGRAM, CARRY IT FORWARD.
YOU KNOW, IF WE DON'T CLOSE ON IT THIS YEAR, YOU CARRY IT FORWARD AT THE 26, UH, THAT WILL BE YOUR CAP.
RIGHT? EVEN IF YOU CAN HAVE IT CLOSED ON IT, DON'T CLOSE BEFORE YOUR EXPIRATION.
YOU HAVE IT FOR THREE YEARS BUT YOU HAVE IT THERE FOR THREE YEARS FOR SINGLE FAMILY, NOT, YOU CAN'T MOVE INTO MULTIFAMILY.
ERIN, YOU COMFORTABLE FROM A STAFFING PERSPECTIVE? THAT WAS, THAT WAS MY NEXT QUESTION, MIKE.
SO WHAT, WHAT HAVE WE SEEN, WHAT DOES THIS TAKE, OR FROM A STAFFING PERSPECTIVE, SAY WE DO TAKE 25 MILLION, WHAT, WHAT DOES THAT TAKE IN TERMS? YEAH, THAT'S A GREAT QUESTION.
ERIN AND I HAD TALKED ABOUT THIS LAST YEAR, I BELIEVE AT THE TOP CONFERENCE.
AND SO I, I WANTED TO WAIT AND MAKE SURE THERE WERE NO MORE QUESTIONS.
I'M GONNA SAY THE LAST THING THAT I'LL LEAVE YOU WITH IS HAVING THE LENDER DATABASE TO WHO, WHO WANTS TO DO THESE LOANS AND, AND KNOWING WHO THEY ARE IS WHAT ONE OF THE THINGS THAT STEVE BRINGS TO THE TABLE.
UH, OUR TEAM OF LAND HOME WHO IS, WHO IS HERE TODAY WAS ROBERTON LAND.
OUR TEAM, WE HAVE SPENT THE LAST THREE YEARS RECRUITING LENDERS AND I BELIEVE THERE ARE OVER, UH, OVER 150 CORRESPONDENT LENDERS PRESENTLY SIGNED UP.
BUT WHAT WE DO, AND I'LL GIVE YOU AN EXAMPLE AND COME BACK TO YOUR QUESTIONNAIRE, IS TULSA COUNTY HOUSING CLIENTS AGENCY HAS NO STAFF AND FOUR BOARD MEMBERS.
WE ORIGINATED A A $25 MILLION BOND TRANSACTION IN, IN 90 DAYS.
AND SO CAN DO IT WITHOUT STAFF.
AND THE REASON IS WE HAVE PROGRAM ADMIN STAFF IN OUR DENVER OFFICE THAT SENDS OUT DAILY EMAILS TO A LIST OF REALTORS AND LENDERS FOR YOUR AREA, LETTING THEM KNOW, HERE'S THE PROGRAM, HERE'S WHAT THE ASSISTANCE IS, AND SEND THE LOAN TO LAND ON FINANCIAL SERVICES TO GET PURCHASED.
SO WE HEAVILY MARKET YOU OR NOT GONNA REQUIRE ANY STAFF, UH, YOUR CITY COUNCIL WOULD NEED TO ULTIMATELY APPROVE IT, BUT IN YOUR STATE BOND BU BOARD.
BUT STAFFING WISE, WE DO ALL OF THAT.
UM, BECAUSE WE KNOW WHO THE LENDERS ARE, WE'VE DEVELOPED THE RELATIONSHIPS WITH, UH, WE'VE PULLED THE DATA FOR, IT CAME OUT, UH, APRIL 1ST, WHICH WAS YOUR ANNUAL HONDA DATA TO KNOW WHO IN THE CITY LIMITS ITAL FUNDED 30 YEAR FIXED RATE, FHA LOANS LAST YEAR.
WE KNOW WHO THEY ARE AND THE AMOUNTS THEY FUNDED AND HOW MANY LOANS THEY WERE.
SO WE, WE MARKET DIRECTLY TO THEM ONCE INDEED, IF INDEED YOU ALL DECIDE TO MOVE FORWARD WITH SOMETHING, SO THE AIR IN ANSWER QUESTION, IT DOESN'T REQUIRE ANY ADDITIONAL STAFF.
SO, UM, GO AHEAD AND THIS IS BRAXTON AGAIN.
UM, I, I WAS GONNA JUST SAY THAT, YOU KNOW, EL PASO, LIKE MIKE MENTIONED, THEY HAVE DONE THEIR OWN PROGRAM AS WELL.
AND THEY, THEY HAVE CURRENTLY ONE
[01:05:01]
FULL-TIME STAFF MEMBER, THEIR EXECUTIVE DIRECTOR AND A PART-TIME STAFF MEMBER, UH, THAT THEY DID NOT HIRE ANYONE ADDITIONALLY TO, TO HELP WITH THE PROGRAM.BUT THE, UH, I'LL SAY THAT, UH, THEIR EXECUTIVE DIRECTOR HAS BEEN VERY INVOLVED ON HER OWN, UH, JUST WITH LENDER OUTREACH AND KIND OF HELPING ON, ON HER OWN WITH THAT, WITH, UH, COORDINATION WITH THE UNDERWRITER AND MASTER SERVICERS.
SO IF, IF, IF YOU GUYS WOULD LIKE TO BE INVOLVED WITH THAT, I MEAN, I'M SURE ELIZABETH, THE EXEC DIRECTOR, THEY WOULD KIND OF HELP OUT AARON AND KIND OF HAVE DISCUSSIONS WITH THEM TO LET HIM KNOW WHAT HE'S BEEN DOING TO, YOU KNOW, FOR THE SUCCESS OF THEIR PROGRAM AS WELL.
BUT I GUESS, UH, REASON I WAS LOOKING AT SECRETARY PAGES, BECAUSE I THINK WE WANNA BE SURE THAT, UM, JUST AS HE ASKED ABOUT, UM, WITH THE T-D-H-C-A PROGRAM, WE WOULD WANNA BE SURE THAT WE'RE COVERING ALL PARTS OF DALLAS.
UH, AND SO YOU'RE SAYING THAT BECAUSE YOU WOULD BE USING SO MANY DIFFERENT LENDERS, YOU WOULD MAKE SURE THOSE LENDERS ARE LOCATED, OR THOSE LENDERS, UH, HAVE BEEN DOING FINANCINGS IN ALL PARTS OF THE CITY.
WE KNOW, WE KNOW WHO THE LENDERS ARE.
RIGHT? LET'S SAY IT, IT MIGHT BE, UH, 500 OF THEM IN THAT ANNUAL
WE PULL THAT DATA, WE THEN KNOW WHO THE LOAN OFFICES ARE IF WE MARKET RECORD TO THEM.
AND SO IN, IN TULSA, I'LL GIVE YOU AN EXAMPLE.
WE STOOD UP THAT PROGRAM THEY HAD, THEY HAD NOT ISSUED SINCE 2010 IS LAST TIME THEY ISSUED.
AND SO WE STOOD UP THE PROGRAM AND WE CREATED LIVE TRAINING FOR REALTORS AND LENDERS IN TULSA AND ALSO IN, IN CLEVELAND COUNTY IN NORMAN, OKLAHOMA.
AND, AND WITH ONE OF THE, UH, PARTIES THAT WE USE, WE RECORD THAT LENDER TRAINING AND THAT REALTOR TRAINING, AND IT'S AVAILABLE 24 7.
AND OUR, OUR OFFICE PEOPLE SENDS THAT OUT ON A WEEKLY BASIS TO THE REALTOR DATABASE.
SO KNOWING WHO THE LENDERS ARE, THAT'S THE BACK OFFICE FUNCTION THAT WE PROVIDE.
AND MAKING SURE THAT WE MARKET THE PROGRAM HEAVILY IN ADVANCE OF BOND CLOSING AND BOND PRICING.
WE MARKET HEAVILY AND GET THE LENDER SIGNED UP.
NO ONE WANTS AN UNSUCCESSFUL PROGRAM.
SO WE SPEND THE TIME SIGNING UP THOSE LENDERS WITH PROGRAM LENDER AGREEMENTS, UH, MAKING SURE THAT WE GET THAT OUT.
AND THE SERVICER DOES A GOOD JOB OF, THEY TAKE THEIR DISTINCT LIST OF 150 CORRESPONDENT LENDERS AND THEY SEND OUT A BLAST WITH A PROGRAM LENDER AGREEMENT THAT SAYS WE NOW HAVE A PROGRAM AVAILABLE IN CITY LIMITS IN DALLAS, AND THEN ALL OF A SUDDEN THIS LENDER START SIGNING UP.
SO IT'S, IT'S A MASS MARKETING, BOTH OUR PART AND THE, THE SERVICERS PART, AND THEN THE, THE THIRD PARTY, UH, E HOUSING THAT WE USE AS WELL.
YOU FEEL LIKE THAT'S OKAY, EXCEPT THE RISK OF OVERSIMPLIFYING IS BIGGEST DIFFERENCE BETWEEN HAVING OUR OWN PROGRAM AND ALLOCATING OUR UH, OKAY.
BOND ALLOCATIONS TO SAVE THAT ISSUE FEE, YOU DON'T HAVE TO ISSUE YOUR FEE.
WE HAVE TO ALLOCATE BONDS TO SAVE.
YOU GET, YOU GET SOME TYPE OF FEE FROM YOUR OTHER PROGRAM WHERE YOU'RE SIGNED, YOU GET SOMETHING.
YEAH, WE DO, WE DO GET A SMALL, YOU GET SOMETHING IN HUNDRED BUCKS.
BUT I MEAN, LIKE, I NEED THE CAPITAL INVESTMENT UPFRONT.
THE CAPITAL INVESTMENT, LACK OF CAPITAL INVESTMENT ON THE OTHER SIDE.
AND SO WHAT, WHAT WE'RE FINDING IS LOCALS THAT HAVE, UM, IN, IN OTHER AREAS OUTSIDE OF, UH, TEXAS THAT HAVE, UM, AMASSED A A, A SIZABLE CORPUS, THEY'RE, THEY'RE SAYING HOW WE GOT THESE FUNDS IS WE DID SINGLE FINANCIAL PROGRAMS IN THE NINETIES AND THE TWO THOUSANDS.
THAT'S WHY WE HAVE THE SUPPORT.
SO THEN LOOKING AT IT LIKE THE MARKET WORKS, AGAIN, IT'S TIME FOR US TO GET BACK INTO THE SINGLE FAMILY SPACE.
LET'S GET BACK INTO SINGLE FAMILY MORTGAGE REVENUE BOND.
SO 100% CORRECT ON THAT OTHER PROGRAM, YOU DON'T HAVE A CAPITAL INVESTMENT.
SO IT'S THAT KIND OF OUR DECISION POINT.
I MEAN, WE COULD HAVE A PROGRAM WITH ALL 61 MILLION OF OUR ALLOCATION IF WE WERE WILLING TO PUT UP FRONT CASH TO, TO FUND.
WE DON'T, WE DON'T HAVE TO GIVE ANY.
BUT YEAH, WE DON'T HAVE TO GIVE ANY TO MINE IT MEANT.
AND THEN IN TERMS OF, UM, THE CITY COUNCIL APPROVAL, UM, WHAT WOULD EXPLAIN TO US WHAT THEY WOULD BE APPROVING, THEY HAVE TO APPROVE, LIKE THE, THE FACT THAT WE'RE DOING IT AND THE AMOUNT YOU WANNA, SO MY UNDERSTANDING PLEASE,
AND OF COURSE, YOU'RE GONNA HAVE YOUR ER HEARING, WHICH IS A FEDERAL STATUTE.
IT'S MAINLY THE TOUGHER APPROVAL BECAUSE, BECAUSE WE'RE ALREADY AUTHORIZED TO TAKE OUT DEBT.
IT'S AER YOU NEED TO GO FOR A
IT'S YOUR PRIVATE ACTIVITY BONDS THAT REQUIRE OH, SO IT WOULDN'T BE ACTUALLY THE CITY COUNCIL.
THE DIFFERENCE IS WE HAVE TO GO TO CITY COUNCIL FOR THAT TO APPROVE THE ASSIGNMENT CA, SO WE DON'T HAVE TO, 'CAUSE WE'RE NOT ASSIGNING IT THEN YOU DON'T HAVE TO GO TO THAT.
[01:10:01]
OKAY.AND THERE'S NO RISK WHATSOEVER TO THE CITY.
RIGHT? THE CITY HAS NO OBLIGATION.
AND SO, UH, WE, WE'VE HAD SUCCESS.
I LOOK AT YOUR POPULATION PHASE AS TO WHETHER, UH, YOU COULD SUPPORT A PROGRAM OF EVIDENCE IN EXCESS OF 2 BILLION RESIDENTS IN IN THE CITY.
UH, WE, WE FULLY ORIGINATE ONE IN TULSA COUNTY, WHICH HAS 800,000 RESIDENTS.
SO THE MARKET WAS, UH, VIBRANT ENOUGH THERE TO ORIGINATE A $25 MILLION BONDS TRANSACTION IN 90 DAYS.
BUT HAPPY TO ANSWER ANY QUESTIONS AND IF NOT, I'LL WRAP UP.
ANYBODY ELSE? ANYBODY ONLINE HAVE QUESTIONS? OKAY.
UM, ON TO, UM, REVIEW AND DISCUSSION OF THE PIPELINE REPORT AS OF JUNE 10TH, 2025.
SO WE ARE THIS OF CLOSING OBVIOUSLY THESE THREE DEALS THAT WE TODAY, WE ACTUALLY CLOSED ON LOOP 12 LAST MONTH.
SO BACK THERE ARE ANTICIPATING CLOSING, THINK IT WAS FOR HIGHLINES TO JULY 1ST, UH,
SO IT'S GONNA BE A BUSY SUMMER.
WE'RE GONNA HAVE, UH, THE TAP CONFERENCE ALL MIDDLE OF THAT.
SO PLEASE COORDINATE YOUR CALENDAR FOR THE JULY MEETING AS WELL.
UM, AND I GUESS I WOULD TURN TO EITHER YOU OR BRAXTON.
IS THERE ANYTHING ELSE? LIKE WHAT'S HAPPENING WITH ALLOCATIONS? WHAT ELSE MIGHT BE COMING DOWN THE PIKE? YEAH, SO WE HAVE, YOU KNOW, THE LINCOLN AVENUE CAPITAL DEALS.
UM, I THINK I TALKED TO BLAKE, THE DEVELOPMENT MANAGER YESTERDAY, SAID HE'S ANTICIPATING GETTING A ALLOCATION BEFORE AUGUST FOR THE WEST WALNUT TOWN UP.
MIGHT HAVE THAT ONE BACK FROM MY U, SEE HOW THAT SHAKES OUT.
UM, AND THEN LOOKING FURTHER DOWN THE LINE, SOME OF THEM WERE WITHDRAWN, UH, AND THEN I THINK TUSCANY AT GOLD MAR IT'S KIND OF ON BOTH VARIOUS REASONS AS WELL.
UH, BUT I, I, HERE'S THE OTHER DATE.
IS THAT IN AUGUST? THE WHOLE NEXT BATCH OF APPLICATION SYSTEM? OCTOBER US TO DO THE INDUCEMENTS? YEAH.
SO IT'S KIND OF
ANY OTHER QUESTIONS ON THE PIPELINE? OKAY.
UM, NEXT ITEM IS, UH,
I THINK, IF IT'S OKAY WITH EVERYONE, UM, AS TIME IS GOING ON HERE, IT, UH, THAT I CAN JUST SAY ON THE CORPORATION POLICY RECOMMENDATIONS.
UM, NUMBER ONE, UH, IF MR. KINGSTON'S, UM, HEAR HEARS THIS IS THE CASE, YOU KNOW, MAYBE THESE ARE GONNA KINDA, UM, UH, I DON'T KNOW, GET PUT, PUT TO THE SIDE OR WHATEVER.
BUT IN THE EVENT THAT THEY DON'T, JUST TO REMIND EVERYONE AND TO, UM, TO INFORM OUR BOARD, UH, THIS STARTED BACK IN OCTOBER WITH THE HOUSING DEPARTMENT BEING REQUESTED BY THE HOUSING AND HUMAN, WHATEVER IT IS, HH HOMELESS SOLUTIONS COMMITTEE, TO MAKE SOME RECOMMENDATIONS FOR CHANGES TO BOTH THE TE THE, UH, DALLAS PUBLIC FACILITIES CORPORATION AND THE HOUSING FINANCE CORPORATION.
AND, UM, AND SO THERE WAS, UH, A LOT OF DISCUSSION.
UH, THERE WERE A LOT OF TOPICS, UH, THAT WERE PROPOSED BY THE, UH, DEPARTMENT, UM, TO BE DISCUSSED AND DEALT WITH.
UM, AND THEN, UH, AND, AND EVER SINCE OCTOBER WE'VE BEEN TRYING TO WORK ON THIS.
WE'VE HAD, UH, A LOT OF PRESENTATIONS FROM DEVELOPERS.
WE'VE HAD A LOT OF REVIEW OF THE VARIOUS, UH, DEPARTMENT PROPOSALS, A LOT OF MEETINGS, UM, AND,
[01:15:01]
UH, THE MOST, UH, WE MADE A LOT OF HEADWAY.WE HAD A SMALL MEETING, UM, LAST MONTH, AND WE MADE A LOT OF HEADWAY.
UH, UH, THE DEPARTMENT WAS REP, THE CITY OF DALLAS DEPARTMENT WAS REPRESENTED, UH, THE DHFC WAS REPRESENTED.
TRE, WHICH, UH, UM, IS A VERY ACTIVE ORGANIZATION IN THE CITY, UH, WAS REPRESENTED.
AND, UM, UH, AND ANYWAY,
I THINK IT WAS VERY SUCCESSFUL 'CAUSE WE SAT AT A ROUND TABLE, SOMETHING ABOUT A ROUND TABLE THAT I THINK IS CONDUCIVE TO CONVERSATION.
AND, UM, AND WE MADE A LOT OF HEADWAY.
BUT SINCE THERE WERE A LOT OF DIFFERENT TOPICS, WE DIDN'T GET THROUGH IT ALL.
'CAUSE WE KIND OF HAD A LIMITED TIME THAT WE WERE MEETING.
SO THERE'S ANOTHER MEETING SCHEDULED FOR, UH, THE END OF THIS MONTH, UM, TO, UH, CONTINUE THE DISCUSSION.
AND SO I JUST FEEL LIKE IT'S, UH, NOT QUITE RIPE YET FOR US TO REALLY, UH, SERIOUSLY LOOK AT EACH PARTICULAR ITEM, UH, THAT'S BEING PROPOSED UNTIL MAYBE AFTER THAT MEETING.
YOU KNOW, MY RECOMMENDATION IS THAT WE NOT DELVE INTO THOSE SPECIFIC ITEMS, UM, THAT WE HOLD OFF UNTIL AFTER THIS MEETING.
UM, AND THEN, UH, HOUSE BILL 21
RYAN, DO YOU WANNA DO A LITTLE PRESENTATION? SURE.
UM, YEAH, I THINK AS MOST OF YOU ARE AWARE, ON MAY 28TH, UH, THE GOVERNOR SIGNED INTO LAW HOUSE BILL 21 AND ITS COMPANION SENATE BILL 8 67.
UH, SINCE THAT TIME, I THINK THE INDUSTRY HAS BEEN KIND OF GRAPPLING WITH WHAT REALLY IS IN THERE AND WHAT SOME OF THE WORDS MEAN.
UM, THERE'S, YOU KNOW, FOUR SOME THINGS FROM THE DALLAS HFC STANDPOINT THAT AREN'T GONNA BE TOO MUCH OF A, UM, AN OBSTACLE OBVIOUSLY, UH, DALLAS, HFC COMPLIES WITH, THAT'S NOW LEGAL REQUIREMENT FOR HFCS.
UM, THERE'S AN IMPACT ON OUR JURISDICTION DEALS, WHICH, YOU KNOW, WAS THE DRIVER OF THIS BILL.
OBVIOUSLY, THAT'S NOT BEEN SOMETHING DALLAS HC HAS, UH, UM, PARTICIPATED IN.
UM, THE, I THINK THE CHALLENGE IS GONNA BE, YOU KNOW, THERE, THE, WHAT THEY WROTE INTO, UM, 3 94 IN ADDITION TO, UH, CURBING THE OUT OF JURISDICTION, WHICH EVERYONE WAS IN FAVOR, WE WERE HOPING THEY WOULD STOP THERE AND
UM, SO THEY HAVE RIPPED INTO, UH, 3 94, UM, ADDITIONAL REQUIREMENTS FOR WORKFORCE DEALS IN TERMS OF INCOME RESTRICTIONS, UH, IN TERMS OF AUDIT AND COMPLIANCE, IN TERMS OF THINGS LIKE LEASE PROTECTIONS.
SOME OF THOSE ARE GONNA BE REALLY EASY TO, UH, MANAGE AND ARE CANDIDLY ALREADY BEING DONE.
OTHERS, UH, A LITTLE BIT MORE OF A GRAY HERE.
AGAIN, THE BIG, I THINK X FACTOR HERE IS THEY BUILT INTO FOR WORKFORCE DEALS A, UH, RENT REDUCTION TEST.
SO, UM, NEXT, DAVID SHAKING HEAD
UH, UM, SO NOW, AND IN HERE, I MEAN, AGAIN, THIS ISN'T, YOU KNOW, IT IS NOT NECESSARILY BAD'S POLICY.
IT'S THE POORLY WRITTEN STATUTE.
UM, IT LEANS OPEN A LOT OF INTERPRETATION.
SO WHAT, WHAT THEY'VE SAID IS, ON AN ANNUAL BASIS, 50% OF THE VALUE OF THE EXEMPTION NEEDS TO BE SHOWN IN RENT PRODUCTIONS.
AND THEY'RE GONNA TEST THAT EVERY YEAR.
SO IN THE YEAR, UM, YOU HAVE TO LOOK AT WHAT THE ASSESSED VALUE WAS, WHAT THE VALUE OF THE EXEMPTION IS, AND HOW MUCH IN TERMS OF RENT PRODUCTIONS YOU MADE IN ORDER QUALIFY FOR THE EXEMPTION.
NOW, THE WAY IT'S, I THINK MOST READ THE STATUTE IS THERE'S THE OPPORTUNITY TO MAKE A PAYMENT TO THE TAXING DISTRICTS FOR YOUR SHORTFALL.
UM, AGAIN, IN THEORY, THAT'S NOT, UH, TERRIBLE POLICY.
IT'S AS FAR, AT LEAST I THINK SOME OF THE ROOM WOULD SAY FOR AN INVESTOR OR A LENDER, THEY KIND OF GET THEIR ARMS AROUND THAT AND UNDERWRITE THAT.
SO THAT'S KIND OF THE MAIN CHALLENGE WE'RE DEALING WITH.
UM, IN TERMS OF DEALS GOING FORWARD, WE'RE GONNA HAVE TO COMPLY WITH THAT.
WE'RE GONNA HAVE, THERE'S A DIFFERENT PROCESS FOR GETTING APPROVAL.
WE'RE GONNA HAVE TO GET, UM, THAT ANALYSIS DONE, UM, POSTED ON THE WEBSITE,
[01:20:01]
HAVE, HAVE THAT DONE BEFORE THE BOARD TO APPROVE ISSUE OF WHAT HAPPENS TO THE DEALS DOWN HFC AND OTHER HFCS HAVE ALREADY DONE.AND WHAT THEY'VE SAID IS, YOU HAVE A 10 YEAR PERIOD IN WHICH TO GET INTO COMPLIANCE WITH MOST.
THERE, THERE ARE CERTAIN THINGS LIKE THE LEASE PROTECTIONS, THE AUDIT AND REPORTING, LIKE THAT'S ALL GONNA BECOME EFFECTIVE JANUARY 1ST.
UM, SO, UM, GONNA HAVE TO DEAL WITH THAT.
THERE'S A 10 YEAR, UH, PERIOD WE'RE GETTING INTO COMPLIANCE WITH THE, YOU KNOW, THE MORE BURDENSOME THINGS LIKE THE, UM, RED RESTRICTIONS, WHICH AGAIN, SHOULD BE AN ISSUE, BUT THE RATE REDUCTION TEST IS GONNA BE SOMETHING TO BE DEALT WITH.
SO, YOU KNOW, WHAT WE'RE TELLING CLIENTS IS WE NEED TO FIRST IDENTIFY THE UNIVERSE OF DEALS THAT ARE ALREADY DONE.
UM, AND THEN WE NEED TO GO AND WE NEED TO LOOK AT WHAT ARE THE JANUARY 1ST, 2026, UM, CHANGES THAT ARE COMING INTO PLACE, AND WHAT DO WE NEED TO DO IN TERMS OF POTENTIALLY AMENDING TRANSACTION DOCUMENTS TO MAKE SURE WE'RE IN COMPLIANCE WITH THAT.
UM, AND KIND OF STEP TWO IS, OKAY, IS THERE ANYTHING BIGGER PICTURE, AND I KNOW SOME OF US HAVE TALKED ABOUT
UM, WHAT DO WE NEED TO BE THINKING ABOUT IN TERMS OF GETTING THESE IN COMPLIANCE? UH, YEAR 10 IS, ARE THERE ANY KIND OF MORE STRUCTURAL ISSUES WITH DEAL THAT NEED TO BE CONSIDERED? UM, YOU KNOW, OBVIOUSLY THAT'S 10 YEARS OUT, BUT I DON'T THINK, WE WON'T WAIT UNTIL YEAR EIGHT TO FIGURE OUT, UM, WHAT THE STRATEGY IS.
UM, LIKE IT'S A GOOD THING IS AS JURISDICTION DEALS, UM, IT'S GOT, YOU KNOW, ESSENTIALLY IMPOSSIBLE TO DO UNLESS YOU ARE ABLE TO GET THE CITIES, UH, CONSENT IN THE LOCAL AGENCIES SET, I SUSPECT.
WELL, I KNOW YOU'RE GOING TO BE APPROACHED BY, UH, UH, DEVELOPERS WHO HAVE DONE ADDED JURISDICTION DEALS IN DALLAS
UM, SO YOU MAY HAVE THE OPPORTUNITY IF ANY DEALS ARE, UH, UP TO THE HFCS, UH, STANDARDS TO, UH, HELP FIX THOSE.
SO THERE'S A COUPLE WAYS YOU COULD DO THAT.
YOU CAN JUST GIVE THEM CONSENT TO KEEP DOING WHAT THEY'RE DOING, OR THEY MAY WANNA RESTRUCTURE WITH THE LOCAL ISSUES.
BUT THE WAY I READ THE STATUTE, WE CAN'T GIVE THEM THAT CONSENT.
ONLY THE COUNCIL CAN, THEY WOULD HAVE TO GO TO SAFETY AND TO YOU.
THEY COULD KEEP THEIR STRUCTURE IN PLACE.
IF THEY CAN'T GET CITY, THEY MAY COME TO A LOCAL AND SAY, HEY, WE CAN'T TAKE STRUCTURE WITH YOU GUYS.
BUT IT IS REPLACE, IT IS UNCLEAR BASED ON THE CAPITAL MARKETS REACTION TO ALL THIS, WHETHER WE CAN DO THAT ANYWAYS, YES, LENDERS MAY SAY, NO, YOU KNOW, WE DON'T LIKE THESE NEW LAWS, SO WE'RE NOT GONNA LEND.
AND SO WE CAN'T HELP ANYTHING.
THAT'S THE BIG, LIKE I SAID, IS, IS HOW, HOW LENDERS AND INVESTORS GET COMFORTABLE WITH THIS TYPE ANNUAL AMBIGUOUS TEST.
NOW, CORRECT IF I'M WRONG, I MEAN, I LOOKED AT THIS THING, MY HEAD'S GOT BLOWN INTO PIECES ABOUT SOME OF THE THINGS ARE IN THERE THAT YES, THE 10 YEAR HORIZON COME INTO COMPLIANCE WITH THE DEEPER REPORT BILLING RESTRICTION AND, AND OR PARTICULARLY THAT ANNUAL ANNUAL PUBLIC BENEFIT TEST, WHICH IS GONNA BE TOUGH.
NOW THAT IS THE LATER OF THE SOONER IS IF YOU GOT REFI COMING UP AS WELL.
SO, AND I TALKED TO PEOPLE AT, YOU KNOW, PARTNERSHIPS WITH THE AUSTIN HFC, THEY HAD REFIS COMING UP SOON, LIKE REALLY SOON.
AND THEY DID NOT UNDERWRITE THESE NEW TESTS.
SO NOW THEY'RE GOING TO TECHNICAL DEFAULT IMMEDIATELY.
AND THESE WERE IN JURISDICTION DEALS.
SO THIS NEW LAW, BECAUSE THE LACK OF GRANDFATHERING JUST SENT A WHOLE BUNCH OF IN JURISDICTION, DID IT BY THE RULE, DEALS INTO DISTRESS BY DOING IT.
I MEAN, I, I THINK WE WOULD, MAYBE I WOULD ASK JUST TO, YOU KNOW, STAFF LEGAL FA I MEAN, I THINK MOST OF OUR DEALS, OUR WORKFORCE DEALS OUGHT TO BE GENERALLY OKAY.
I MEAN, LIKE THE WATERFORD DEALS, UH, MIDTOWN, YOU KNOW, A CAPS DEAL, UH, WHITECLIFF, I MEAN, IT WAS ALL DONE WITH TENURE MONEY AND DOWN THE ROAD WHEN THEY COME TO FOR REFI, I THINK YOU MAY BE OKAY IF THEY WANNA REFI.
'CAUSE EVEN WITH THOSE PUBLIC BENEFITS, I THINK THE HEALTH OF THE MARKET SHOULD STILL BE PRETTY GOOD.
IT IS THE BOND DEALS I'M MOST CONCERNED ABOUT BECAUSE THOSE ARE 40 YEAR BONDS AND THOSE ARE A HUNDRED PERCENT LEFT.
AND THOSE UNDER WROTE REALLY TIGHT TO BEGIN WITH.
SO IF THOSE BOND HOLDERS WERE TO UNDERWRITE THIS NEW BOGIE 10 YEARS FROM NOW, IT'S MOST LIKELY GONNA SEE A HUGE DROP IN.
THEY'RE GONNA PROJECT THAT THE PROPERTY CANNOT SUPPORT THOSE BOND PAYMENTS FOR THAT 40 YEAR PERIOD NOW, AND WHAT KIND OF UNCOMFORTABLE CONVERSATIONS DOES THAT LEAD FOR US WITH OUR LENDER ON THESE DEALS? AND SO IT'S THAT DYNAMIC.
I THINK WE PROBABLY JUST WANNA TAKE A LOOK AT IT
[01:25:01]
AS WELL.AND I'M JUST ASSUMING THE OTHER ONE'S LIKE, WELL, NO, YOU KNOW, UH,
SO WHETHER YOU CAN GET WORKFORCE DONE GOING FORWARD, THAT'S GONNA BE ON HOLD.
AND THERE'S A HARTFORD BUILDING AS WELL.
SO JUST LIKE, HEY, WITH ALL OUR DEALS CURRENTLY THAT WE OWN, THAT WE HAVE OUT THERE, WHAT DO WE THINK? WELL, WE ONLY HAVE FOUR, RIGHT? YEAH.
I MEAN, ITS JUST, UNFORTUNATELY WE ONLY HAVE FOUR.
WELL, WE JUST KINDA, WHERE DO WE THINK WE STAND ON THERE? AND IT MAY BE OKAY, YOU KNOW, BUT IT IS THE TWO BOND DEALS.
WHY? IT'S, UH, BRISCO, BRISCO, I MEAN, MORE ANXIETY THERE.
'CAUSE WE DON'T HAVE, IT'S NOT PRIVATE CAPITALIZED, IT'S US, RIGHT? SO, WELL, MY, I'LL ADD, YOU KNOW, I'VE GOTTEN CALLS.
I ALREADY GOTTEN LIKE SIX OR SEVEN CALLS FROM PEOPLE THEY TO TAKE APPLICATIONS.
THEY'RE LIKE, HEY, YOU KNOW, SORRY, WE MESSED UP.
WE WE WANNA PARTNER WITH DALLAS ATFC.
RIGHT? I I DIDN'T KNOW WHAT, WHAT THE PHARMACY GONNA BE UNTIL OCTOBER.
OH, THAT WAS ANOTHER THING YOU MIGHT HAVE MENTIONED WHEN WE THINK REGULATIONS.
YEAH, THERE, AS I MENTIONED, THERE ARE A NUMBER OF GRAY AREAS, UH, IN THE STATUTE.
UH, ONE OF THE HOPES IS THAT T-D-H-C-A HAS, YOU KNOW, UNDER, UNDER THE BILL, UH, THEY'VE BEEN CHARGED FOR COMING UP WITH REGULATIONS, UH, UH, TO IMPLEMENT THESE NEW CHANGES.
SO MOSTLY BACK OCTOBER THEY'RE GOING TO DO THAT.
NOW THINK THEY WERE LATE, UH, DOING THAT A COUPLE YEARS AGO WHERE THEY HAD A SIMILAR TASK FOR THE PFC BILL, BUT HOPEFULLY NOW THEY HAVEN'T MADE UP A ROADMAP HAVING DONE TWO YEARS AGO WITH PFCS.
IT'S A LITTLE DIFFERENT, BUT I'LL SIMILAR IN A LOT OF WAYS.
SO HOPEFULLY BY OCTOBER WE'LL HAVE SOME GUIDANCE ON SOME OF THE ASPECTS OF THIS.
WELL, LOOK, AS FAR AS THE ADDED JURISDICTION DEALS, YOU KNOW, THEY WERE ALL DONE AT THE ABSOLUTE STATUTORY MINIMUM, UH, THAT AN AGENCY WE HAD TO, SO THEY'RE GONNA HAVE TO APPLY THE NEW PUBLIC BENEFIT, WHICH THOSE LENDERS THAT WENT ALONG WITH IT ARE NOT GONNA GO ALONG WITH DOING IT US.
SO I DON'T THINK THAT'S GONNA POSSIBLE THAT ANY DEAL'S GONNA FIT.
THE ONLY ONE, I DO KNOW THAT THERE IS A TAX CREDIT DEAL OUT THERE.
UM, IT WAS DONE WITH AN OUT JURISDICTION, UH, H-S-C-T-D-H-C-A ALLOCATED, UH, YOU KNOW, UH, TAX CREDIT TO ATTORNEY GENERAL SAYS OKAY TO, YOU KNOW, ISSUE BONDS TO AN OUT JURISDICTION HSC, I WOULD PREFER NOT HAVING ANY TAX CREDIT DEALS GO ON.
IT STILL WASN'T RIGHT THAT THEY DID IT THAT WAY.
BUT THAT'S THE ONLY ONE I WOULD CONSIDER FOR BALANCE ON JUST FOR THE HEALTH OF THE OLD ADULT PROGRAM.
I MEAN, YEAH, I, THAT THAT'S SOMETHING WE DISCUSSED.
MAYBE WE HAVE ANOTHER KIND LIMITED STRATEGY SESSION ONCE SAY, ALL RIGHT, BUT YOU KNOW, WE HAVE ALL THESE OBSTACLES HERE, WE WANT MOVE ON 'EM OR WE LET HIM GO, YOU KNOW? I MEAN, THERE, THERE IS THERE.
SO I HAVE ONE OTHER QUESTION FOR RYAN THOUGH.
ON, ON THE OUT OF JURISDICTION ONES, UM, IN THOSE DEALS ON THE REGULATORY AGREEMENT, DID IT BASICALLY PROVIDE THAT, UM, THAT THE, UH, AFFORDABILITY, UH, REQUIREMENTS, UH, WOULD GO AWAY UPON A SALE AT ANY TIME? IN OTHER WORDS, THEY DIDN'T HAVE A A LONG, I'M GUESSING, AND OBVIOUSLY IT'S DEPENDENT ON THE HFC AND WHAT THEIR PREFERENCES ARE, BUT I'M GUESSING THEY WEREN'T CONCERNED ABOUT LONG TERM AFFORDABILITY.
SO IT WAS FOR THE HC WERE DONE BY ONE LAWYER IN AUSTIN AND THEY, THEY THEY COULD, THE REGULATORY AGREEMENT CAN BE DISSOLVED BY THE, NOT THE SPONSOR'S DISCRETION FOR ALL RIGHT.
SO I MEAN, SO THOSE PROPERTIES COULD BE, COULD BE SOLD AND NOT BE SUBJECT TO THE RENT, YOU KNOW, THE AFFORDABILITY RESTRICTIONS.
AND SO MAYBE THAT'S, I MEAN, IT'S NOT OUR PROBLEM, BUT MAYBE IT'S NOT.
BUT LOOK, YOU KNOW, MAYBE THAT'S WHAT THEY DO.
MOST OF THE PEOPLE, MOST OF THE GROUPS THAT DID THIS WERE NOT TRUE AFFORD.
THERE WERE GROUPS THAT WERE OVER LEVERED.
THERE WERE SYNDICATORS THAT, YOU KNOW, SOLD THE EQUITY TO RETAIL INVESTORS BETWEEN 2020 AND 2022 WITH BRIDGE DEBT THAT FLOATED UP AND THEY NEEDED HELP.
AND THIS WAS JUST A PROBLEM SOLVER FOR MOST OF THESE GROUPS.
MOST OF THESE DEALS, A LOT OF THESE DEALS, THEY SOLD IT.
NOW I WOULD LOSE ALL THEIR, JUST, SO I JUST DON'T KNOW IF STEPPING IN, I DON'T KNOW WHY JURISDICTION AGENCY WOULD STEP INTO THAT UNLESS WE WERE SOME REALLY DANG GOOD STORY BEHIND IT.
WAS 3 92 CATCH AT ALL OR ARE WE KIND OF THE ONLY GAME IN TOWN AT THAT? I, NO, NO.
DOES ANYBODY ONLINE HAVE ANY QUESTIONS? NOT
[01:30:01]
THAT ACCURATE.I HAVE A HOUSE BILL 21, NO COMMENT ON THE FIRST, FIRST PART.
THE, UH, UH, HOUSE DEPARTMENT.
SO THERE'LL BE A, A FOLLOW UP MEETING AT THE END OF THIS MONTH.
AND THEN IS THERE CALLING THAT WOULD BE APPROPRIATE FOR THE HOUSING DEPARTMENT TO PRESENT TO OUR BOARD IN TOTAL? WHAT IT IS THAT THEY'RE, YOU KNOW, ASSUMING THEY STILL ADVANCE, YOU WANNA ADVANCE SOMETHING SO THAT EVERYBODY ON BOARD CAN HAVE AN OPPORTUNITY? YEAH.
ASK QUESTIONS OF 'EM AND HAVE AN DIALOGUE FOR SURE.
WHY AUGUST MEETING, WHENEVER THIS IS TIME TO FIND OUT WE HAVE DISCUSSION.
YEAH, BECAUSE I, I FEEL LIKE ONE OF THE PROBLEMS HAS BEEN THAT, YOU KNOW, A LOT OF THIS WE JUST, YOU KNOW, WE'RE, WE'RE MONITORING THE WEBSITE AND SOMETHING JUST SHOWS UP, UM, AS AN, YOU KNOW, AS AN EXHIBIT TWO.
THE HOUSING NORMAL SOLUTIONS COMMITTEE AND THEN WE'RE ALL SCRAMBLING.
AND WE CAN'T ALL SCRAMBLE AS A BOARD BECAUSE THEN WE FIGURE THE OLD MEETINGS DEPARTMENT.
SO WE HAVEN'T HAD AN OPPORTUNITY FOR, WELL SOME OF US HAVE, HAVE BEEN VERY INVOLVED LIKE ME.
UM, OTHERS, YOU KNOW, HAVE NOT THAT'S RIGHT.
GAVE EVERYBODY, ALL THE BOARD MEMBERS A CHANCE TO BE FULLY UP TO SPEED AND
BUT WE HAVE, THIS BOARD HAS NOT REALLY HAD AN UPDATE SINCE.
AND THEN YEAH, JUST TO HEAR FIRSTHAND, YOU KNOW, WHY, YOU KNOW WHAT IT IS, YOU KNOW, WHATEVER.
WELL, AND SOME OF THE THINGS THAT WERE IN THOSE RECOMMENDATIONS ARE AFFECTED BY HB 21.
THAT'S WHY WE KIND OF PUT IT AS ONE TOPIC.
UM, SO EVERYONE HAS TO GO BACK TO THE DRAWING BOARDS BECAUSE NONE OF THAT WAS KNOWN EVEN IN THIS SLIGHTEST ITERATION FROM THE HOUSING DEPARTMENT.
ANY OTHER QUESTIONS? 'CAUSE OTHERWISE WE WOULD, WE NEED TO GO INTO OUR EXECUTIVE SESSION.
UM, SO IT IS 1:36 PM ON JUNE 10TH, 2025.
DALLAS HOUSING FINANCE CORPORATION WILL NOW GO INTO CLOSED SESSION UNDER SECTIONS 5 51 0.071 AND 5 51 0.074 OF THE TEXAS OPEN MEETINGS ACT ON THE FOLLOWING MATTER DESCRIBED ON TODAY'S AGENDA.
ONE FOR THE CORPORATION TO SEEK THE ADVICE OF ITS ATTORNEY ABOUT A MATTER ON WHICH THE DUTY OF THE ATTORNEY TO THE CORPORATION UNDER THE TEXAS DISCIPLINARY RULES OF PROFESSIONAL CONDUCT OF THE STATE BAR OF TEXAS CLEARLY CONFLICTS WITH THE TEXAS OPEN MEETINGS ACT.
AND TWO, DELIBERATE THE EMPLOYMENT AND DUTIES OF AARON QUINTO FOR THE POSITION OF GENERAL MANAGER OF THE CORPORATION.