Travis County Commssioners Court
September 30, 2003
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Housing Finance Corporation
Now let's call to order the Travis County housing finance corporation. Item 1 is approve minutes.
>> move approval.
>> all in favor? That passes by unanimous vote. Number 2 consider approval of an issuer and annual fee collection policy and review collection of annual fees and take appropriate action.
>> good afternoon. Harvey Davis, manager for the corporation. I'm here with our attorney, and there are a couple of reasons why I thought it made sense to have a written collection policy. One is that the amount of the annual fees has gone up in significantly. In f.y. '01 it was a little over $55,000. And for the coming year, the amount of the fees will be a little over $202,000. The second reason is that for the past year, we have had some difficulties in collecting the annual fee from two apartment owners, this being the first time that we've had collection problems. And the reason we had -- we were having these collection problems, both of these are non-profit apartment owners, is because of the bad apartment economy and also because these non-profits are having some issues with the appraisal district thing in being approved for their property tax exemption. Wow like me to briefly go over what's in the collection policy that I'm asking you all to approve?
>> wouldn't hurt to go over it briefly. Some apartment managers may be watching us.
>> okay. As you know, we have two fees, the issuer fees, which is 50 basis points of the amount of the bonds that are issued or 25 basis points if it's a refunding situation. And then we have the annual fee, which is 10 basis points of the amount of the outstanding bonds each year. For the issuer fees, we've really never had difficulty in collection -- collecting the fee because as long as we get an invoice to the -- to our attorney and that invoice is presented at closing, then it becomes just part of an expense -- a closing cost expense. And as I said, we've always collected the issuer fee. For tapbl fee, the -- the annual fee, the policy says that about 30 days before the fee is due, staff would send an invoice to the party that is responsible for paying the fee. Sometimes that is the trustee, sometimes it's the apartment owner. And then if we sent the invoice to the trustee, we would send a copy to the apartment owner so that they are aware that we're -- we're trying to collect on the fee. If the fee is not paid within 10 days of the due date, then we would send a follow-up invoice to the -- to whoever is supposed to pay the party. If it's the trustee, we would attempt at that point to collect from the apartment owner, inform them it hadn't been collected. And then we would also send a copy of that invoice to other appropriate parties that would include the board of directors. Then if the fee is not paid within the next 20 days so it becomes 30 days past due, then we would aagendize the item, come to the board and with consulting with your attorney decide on what would be the appropriate action, next step in trying to collect that fee. That's the basic summary of the policy.
>> your recommendation is put this in place and see how it works?
>> that's my recommendation.
>> anything to add?
>> no.
>> that's why I move approval.
>> second.
>> any more discussion? All in favor? That passes by unanimous vote. I guess it's a good time to share this policy with the various apartments is when the new ones at the time are close aog I think since you've adopted it we'll put it in the application package and policy guidelines so the borrowers have it from the minute they start talking to us about doing a project.
>> tell them not to mess around with the board. Number 3, we did vote on that, is consider and take appropriate action on request to approve request from wachovia affordable house to go transfer its limited partner interest in westchester ltd. And waive transfer fees. Now, we normally charge a transfer fee?
>> no, sir, not for this type of transfer. This is a transfer of a limited partnership interest, and the documents normally do not have this transfer fee in here. In talking to wachovia's counsel, it was a mistake so they are requesting -- it is normal for this type of transfer not to pay such a hefty fee. One percent of the bond amount would be $157,500 or somewhere in that range. So it's a fairly large fee for just change ago limited partner. They've requested that waiver. The documents provide for three things. A $3,000 administrative expense-type fee. The 1% transfer fee. And then any out of pocket expenses you all incur with the transfer. They specifically requested two things, consent to the transfer and waiver of the 1% fee. I guess it would be up to you all -- i've already talked to them about paying any expenses incurred and they are agreeable with that. I think the real question is whether you want to ask them for the $3,000 fee or not. And you are not required to waive the 1% fee, but it is normal course of business to not collect a fee on this.
>> we have never collected it.
>> not on this type of transfer.
>> speaking of annual fees, --
>> this project is caught up. They pay actually the annual fee monthly and we get a check from the trustee like clock work.
>> move we approve the transfer and waive the transfer fee.
>> second.
>> with the understanding they will pick up any costs incurred. Seconded by director Gomez. Any more discussion? All in favor? That passes by unanimous vote.
>> thank you all.
>> move adjourn.
>> second.
>> all in favor? That passes by unanimous vote also.
Last Modified: Tuesday, September 30, 2003 7:52 PM