Department: Housing and Community Development
Department Head/Elected Official: Thao Costis, Executive Director
Regular or Supplemental RCA: Supplemental RCA
Type of Request: Contract - Award
Project ID (if applicable): Lost Oaks
Vendor/Entity Legal Name (if applicable): Mark-Dana Corporation
MWDBE Contracted Goal (if applicable): N/A
MWDBE Current Participation (if applicable): N/A
Justification for 0% MWDBE Participation Goal: N/A - Goal not applicable to request
Request Summary (Agenda Caption):
title
Request by Housing and Community Development for approval to conditionally award up to $4,528,000 of American Rescue Plan Act (ARPA) State and Local Fiscal Recovery Funds to purchase the land for the Lost Oaks for the Harris County Housing Finance Corporation with a maximum purchase price of $2,850,000 and to negotiate and execute a loan agreement of up to $1,678,000 in ARPA State and Local Fiscal Recovery Funds for eligible development costs for the Lost Oaks project.
end
Background and Discussion:
On March 26, 2024, Mark-Dana Corporation previously requested and was conditionally awarded up to $3,100,000.00 in ARPA State and Local Fiscal Recovery Funds for the acquisition and development of a new multi-family affordable housing development called Lost Oaks located at 810 Oak Street, Houston 77018. Mark- Dana Corporation was awarded 9% LIHTC Tax Credits by Texas Department of Housing and Community Affairs (TDHCA) in 2023. The total development costs for Lost Oak are $26,044,410.
Pursuant to the statutory requirements under TDHCA, Harris County Housing Finance Corporation is limited in the amount it can earn from ground lease payments on each round of 9% tax credits awarded. Harris County Housing Finance Corporation is limited to $3,000,000 for projects awarded 9% LIHTC Tax Credits in 2023, and it has reached that limit on other projects currently in progress. TDHCA did not give Harris County Housing Finance Corporation a waiver on this cap requirement. As a result, both Mark-Dana Corporation and Harris County Housing Finance Corporation agreed to restructure the deal and will need to proceed under a ground lease only structure. The Harris County Housing Finance Corporation will not receive Equitable Title. Under the ground lease only structure, the developer will not receive a tax exemption which will require more ARPA funding to fill the resulting gap in capital stack. Therefore, Mark-Dana Corporation needs to increase its initial request for ARPA State and Local Fiscal Recovery Funds to $4,528,000.00.
The Lost Oaks will create 78 new Multi-Family Affordable Housing Units. The unit mix will consist of 11 units for those making 30% or less of Area Median Income, 32 units for those making between 31%-50% of Area Median Income, and 35 units for those making between 51%-80 Area Median Income, The Project will consist of 23 one-bedroom units, 50 two-bedroom units and 5 three-bedroom units. The HCHFC will own the land and the Project will enter a 99-year ground lease, which will keep the project affordable for 99-years.
Expected Impact:
The expected fiscal impact is to transfer $2,850,000.00 in ARPA State and Local Fiscal Recovery Funds to the HCHFC to acquire the land for the Lost Oak Project and give a conditional commitment of $1,678,000 in ARPA State and Local Fiscal Recovery Funds to Mark -Dana Corporation for eligible development cost for the Lost Oaks Project.
Alternative Options:
The alternative option is that the project will not move forward.
Alignment with Goal(s):
_ Justice and Safety
_ Economic Opportunity
X Housing
_ Public Health
_ Transportation
_ Flooding
_ Environment
_ Governance and Customer Service
Prior Court Action (if any):
|
Date |
Agenda Item # |
Action Taken |
|
03/26/2024 |
16 |
On March 26, 2024, Mark-Dana Corporation previously requested and was conditionally awarded up to $3,100,000.00 in ARPA State and Local Fiscal Recovery Funds for the acquisition and development of a new multi-family affordable housing development called Lost Oaks located at 810 Oak Street, Houston 77018 |
Location:
Address (if applicable): 810 Oak Street, Houston 77018
Precinct(s): Precinct 1
|
Fiscal and Personnel Summary |
|
Service Name |
Affordable Rental Housing |
|
|
|
Current Fiscal Year Cost |
Annual Fiscal Cost |
|
|
Labor |
Non-Labor |
Total |
Recurring Expenses |
|
Funding Sources |
|
|
Existing Budget |
|
|
|
|
|
2651 - American Rescue Plan 2021 |
$ |
$4,528,000.00 |
$4,528,000.00 |
$ |
|
Choose an item. |
$ |
$ |
$ |
$ |
|
Choose an item. |
$ |
$ |
$ |
$ |
|
Total Current Budget |
$ |
$4,528,000.00 |
$ |
$ |
|
Additional Budget Request (Requires Fiscal Review Request Form) |
|
|
Choose an item. |
$ |
$ |
$ |
$ |
|
Choose an item. |
$ |
$ |
$ |
$ |
|
Choose an item. |
$ |
$ |
$ |
$ |
|
Total Additional Budget Request |
$ |
$ |
$ |
$ |
|
Total Funding Request |
$ |
$4,528,000.00 |
$4,528,000.00 |
$ |
|
Personnel (Fill out section only if requesting new PCNs) |
|
|
Current Position Count for Service |
- |
- |
- |
- |
|
Additional Positions Request |
- |
- |
- |
- |
|
Total Personnel |
- |
- |
- |
- |
Anticipated Court Date: June 4, 2024
Anticipated Implementation Date (if different from Court date): N/A
Emergency/Disaster Recovery Note: COVID-19 related item
Contact(s) name, title, department: Sam Borders, Director, Multi-Family Housing Development, Harris County Housing and Community Development
Attachments (if applicable): Court Order