Louisville Housing Authority Agenda and Packet 2011 09 27

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If the current tenants received location vouchers at Hillside, you could borrow $700,000 800,000 that could be usable in other places. Once you are rid of the tax credit situation at Lydia Morgan, you could do the same. It's worth $1.2 million. It does need to be refinanced and meet some needs without taking on a lot more debt. Regal Court I needs operating efficiency. Maybe you could do a cooperating deal with BCHA to put them all into a partnership. Regal Square it is operating pretty well with a few capital needs. Acme land may have a better use than as affordable housing. It might be saleable for cash that could be applied somewhere else. In the meantime, it works. If you take existing units and put them into a partnership, a low income housing tax credit project, the investors will want substantial rehabilitation. $25,000 a unit upgrades are not needed in most cases. The use of that tax credit must be done carefully and judicially. Prices for tax credits are back where they were in 2007. Scott asked when the concept of restructuring was brought in the spring it seemed like a fabulous idea. Now HUD is not as encouraging as they were before. Steve Clark said that every government agency, including HUD, is trying to find every way in the world to save budget dollars. Normally relocation and replacement vouchers are much more highly scrutinized. They want to make sure the plan you have leverages new housing, adds value, and solves problems. Chuck said that HUD is going to look at the cost impact of going through disposition and what it would cost the federal level as far as per unit tenant protection vouchers. Their per -unit allocation, on a monthly basis, is about $425 month in subsidy. With tenant protection vouchers, it is probably double. The advantage we have is that it is such a small portfolio that the HUD regional office would look at that in our favor. They are still approving disposition applications and are mindful of the story that is being told. 6 8 months is all it would take from start to finish. Frank and I have already done the majority of that. Frank said we would need to bring this back to the board for budgetary approval. Each one of these pieces would require an up -front planning allocation from your reserves. We would need to break down the budget for each item and get your approval to move forward with the work. That would lead to applications being submitted. We are close to recommending that. Steve Underhill said he said he thinks it's a fabulous idea and we probably should pursue it. He is stepping back, as he is leaving the board, and won't be involved in the fmal decision making. He explained to Kelly said that the Lydia Morgan property is subject to Public Housing voucher. The tenant only pays 1/ 3 of their income. The rent is "market" rent and HUD pays the remainder. There is a disposition program at HUD, whereby you can sell the property to an affiliated partnership. In our case, we can recapitalize it at market rate, with the proviso that the tenant would get replacement vouchers where they could stay there or go elsewhere. We could then take that money, the $800,000, out of that project and use it to leverage for a new building or capital improvements. Property Management/Maintenance Report Rent and Occupancy Update Sally said that we are experiencing a summer time increase of move ins and move outs. Tomorrow we will have 6 available units in Louisville. We have been actively advertising these. Hillside has two units available with wait lists to draw from. Lilac Place has an application and will be rented Oct. 1st and a showing schedule for 5 on the other available unit. At Lydia Morgan we have a vacancy and it is already signed. August 31S vacate already has an application. Regal II is leased for Sept. 20. At Sunnyside the two bedroom has scheduled showing. The other two bedroom is advertised now. The 3- bedroom is leased for Nov. 1S By the end of September the 11 vacancies are almost all actively leased. Monthly Rental Vacancy Report Karen gave a presentation on the Sunnyside Toddler playground. After looking at 4 companies we don't want to go with wood structures. We are looking at expenses of between $22,000- $23,000. We are looking at rubber matting at $10,000. It is a poured rubber surface that is safe and can't be picked up by the children. It's a small area, 25'x28', with slides and a climbing area with a traverse bar, geared to children from 2 10 years of age. Swings are not recommended. The impact on insurance is not known, but should be minimal.