DEPARTMENT: Neighborhood and Housing Services
DEPARTMENT HEAD: Verónica R. Soto, FAICP
COUNCIL DISTRICTS IMPACTED: City Wide
SUBJECT:
Resolutions of Support for multifamily rental housing development projects seeking 2021 Competitive 9% Housing Tax Credits (HTC) from the Texas Department of Housing and Community Affairs (TDHCA).
SUMMARY:
Consideration of eleven Resolutions of Support for multifamily rental housing development projects by respondents seeking 2021 Competitive 9% Housing Tax Credits (HTC) from the Texas Department of Housing and Community Affairs (TDHCA).
BACKGROUND INFORMATION:
The Texas Department of Housing and Community Affairs (TDHCA)’s Housing Tax Credit (HTC) Program allocates federal tax credits to developers to encourage the construction and rehabilitation of affordable multifamily housing. There are two types of tax credits: Competitive (9%) and Non-Competitive (4%). The Non-Competitive 4% HTC program is available year-round whereas the Competitive 9% HTC program has a single annual application period. The 9% Program is allocated through an annual competitive process in which projects are evaluated and scored according to the TDHCA’s established criteria. An application must include a Resolution of Support or a Resolution of No Objection from the governing body of the municipality where the project is located.
On October 31, 2019, City Council adopted an updated Housing Tax Credit (HTC) Policy for the issuance of Resolutions of Support and Resolutions of No Objection. The new policy added a focus on deeper affordability and developments in targeted areas including Regional Centers. Developers submitting 2021 Competitive 9% HTC applications to TDHCA must score 75 points on their city application to be recommended for a Resolution of Support by staff. Developers must score 60 points and have ownership/ management experience to be recommended for a Resolution of No Objection. Applications for the 2021 Competitive 9% HTC are due to TDHCA no later than March 1, 2021.
On November 30, 2020, Neighborhood & Housing Services Department (NHSD) issued a call for applications to those developers that would be pursuing the 9% tax credit for their project. Applications were due on January 4, 2021. NHSD received 15 applications for a Resolution of Support from City Council to include in their TDHCA 2021 Competitive 9% HTC application.
In some cases, TDHCA will not award HTCs to a project if certain conditions exist unless the municipality specifically waives the requirement in the Resolution of Support. Example conditions include if a project is located within one mile of a development awarded within the last three years, if the project is in a census tract that would result in more than 20% of the total housing units being supported by HTCs, and if the project is in a census tract with a poverty rate that exceeds 40%. Additionally, a project will receive an additional two points if it is located within a revitalization zone designated by a municipality’s governing body. These conditions are taken into consideration in the City Council approved evaluation criteria.
All 15 applications have scored more than 75 points. However, four applications have been withdrawn and therefore staff is only recommending that 11 applications receive a Resolution of Support.
ISSUE:
The City received 15 applications for a Resolution of Support from City Council to include in their TDHCA 2021 Competitive 9% HTC application. Applications with a score of at least 75 points are eligible to be recommended for a Resolution of Support and those earning between 60 and 74 points may be recommended to receive a Resolution of No Objection. The final scores ranged from 79 to 96 points and 4 of the 15 applicants withdrew their applications. Staff is recommending that the following 11 projects are awarded a Resolution of Support:
|
Development |
Applicant |
|
Cosmopolitan Apartments |
Cosmopolitan Apartments, LLC (Loopy Limited) |
|
Four25 San Pedro |
ARDC San Pedro, Ltd (Franklin) |
|
Denver Heights Senior Village |
CSH Denver Heights Senior Village, Ltd. (SuperUrban Realty Ventures) |
|
Village at Boyer |
ALT Affordable Housing Services, Inc.- Arbor (Prospera) |
|
Ada Street Apartments |
Ada Street Apartments, Ltd. (NRP) |
|
Fish Pond at Prospect Hill |
FishPond Living at Prospect Hill, LP |
|
Village at Medical Senior Apartments |
ALT Affordable Housing Services, Inc.- Arbor (Prospera) |
|
Snowden Apartments |
San Antonio Housing Authority |
|
Fiesta Trails |
Fiesta Trails, Ltd (NRP) |
|
Vista Med |
Vista Me, LP (Atlantic Pacific) |
|
Village at Perrin Beitel |
ALT Affordable Housing Services, Inc.- Arbor (Prospera) |
Two pre-applications were submitted to TDHCA that will compete with the proposed projects above for a 9% HTC awards. One of the applications is for a project in San Antonio city limits, but who did not complete an application for a Resolution per the city’s policy and therefore is not recommended to receive a Resolution of Support nor a Resolution of No Objection. The other application is located in Leon Valley and will apply for a Resolution from Leon Valley’s municipality.
TDHCA will not award HTCs to a project if certain conditions exist unless the municipality specifically waives or the requirement or acknowledges the condition in the Resolution of Support. Example conditions include if a project is located within one mile of a development awarded within the last three years, if the project is in a census tract that would result in more than 20% of the total housing units being supported by HTCs, and if the project is in a census tract with a poverty rate that exceeds 40%. Additionally, a project will receive an additional two points if it is located within a revitalization zone designated by a municipalities governing body. These conditions are taken into consideration in the City Council approved evaluation criteria.
Two applications are for projects located within one mile of a development awarded HTC’s within the last three years: Village at Boyer and Four25 San Pedro. Staff recommends Resolutions that waive the one mile requirement for the projects because they have met the HTC policy goals adopted by Council and would contribute to meeting the affordable housing needs of our city.
One application is for projects in census tracts with a poverty rate that exceeds 40%: Fish Pond at Prospect Hill. Staff recommends Resolutions acknowledging the high poverty rate and authorizing the development to move forward with its application for all of the projects because they have met the HTC policy goals adopted by Council and would contribute to meeting the affordable housing needs of our city.
Additionally, seven of the remaining applications are for projects that are in designated revitalization areas and the Resolution must acknowledge that they are within the designated area. Staff recommends issuing these Resolutions in alignment of the City’s HTC policy.
Below is a table with each of the projects along with a revitalization plan in which their proposed project is located and staff scores:
|
Council District |
Development |
Revitalization Plan |
Staff Score |
|
1 |
Cosmopolitan Apartments |
Tobin Hill |
82 |
|
1 |
Four25 San Pedro |
Urban Renewal Plan |
84 |
|
2 |
Denver Heights Senior Village |
TIRZ #11- Inner City |
93 |
|
2 |
Village at Boyer |
Urban Renewal Plan AND Arena District/Eastside Community Plan |
92 |
|
3 |
Ada Street Apartments |
SA Tomorrow Brooks Area |
79 |
|
5 |
Fish Pond at Prospect Hill |
TIRZ #30- Westside |
79 |
|
10 |
Village at Perrin Beitel |
TIRZ #33 Northeast Corridor |
96 |
ALTERNATIVES:
City Council may elect to not issue some or all of the Resolutions recommended by staff which would adversely impact the developers’ applications with TDHCA’s Housing Tax Credit program and deem the affordable housing developments financially infeasible.
FISCAL IMPACT:
This authorizes Resolutions for multifamily rental housing development projects by applicants seeking Competitive 9% Housing Tax Credits with the Texas Department of Housing and Community Affairs for the 2021 program. There is no fiscal impact to the FY 2021 Adopted Budget with this action.
RECOMMENDATION:
City Staff is recommending the following Resolutions:
|
Development |
CD |
Resolution of Support |
1 Mile, 3 YR Waiver |
Contributing Most to CRP |
40% Poverty Rate Waiver |
|
Cosmopolitan Apartments |
1 |
X |
|
X |
|
|
Four25 San Pedro |
1 |
X |
X |
X |
|
|
Denver Heights Senior Village |
2 |
X |
|
X |
|
|
Village at Boyer |
2 |
X |
X |
X |
|
|
Ada Street Apartments |
3 |
X |
|
X |
|
|
Fish Pond at Prospect Hill |
5 |
X |
|
X |
X |
|
Village at Medical Senior Apartments |
7 |
X |
|
|
|
|
Snowden Apartments |
7 |
X |
|
|
|
|
Fiesta Trails |
8 |
X |
|
|
|
|
Vista Med |
8 |
X |
|
|
|
|
Village at Perrin Beitel |
10 |
X |
|
X |
|