Travis County Commssioners Court
March 16, 2004
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Housing Finance Corporation
We do need the Travis County housing finance corpse, though, and I call it to order. First item is to consider and take appropriate action to approve representation letter for deloitte and touche.
>> good afternoon, I'm harvey Davis, manager for the corporation, and this is the annual representation letters from our outside auditors that basically says that we have disclosed all the information -- all the relevant information for them to committee the audit similar to the letter that the county signs. This letter is signed by the board of directors and myself and three other people in our office. I have coordinated with the county auditor's office as far as making sure this letter -- that the issues that they with the auditor, that we made the necessary changes in the letter.
>> any questions, comments or concerns about the letter? I move approval: thank you. Anymore discussion? Let's show director Gomez absent for the entirety of this meeting. All in favor. That passes by unanimous vote. Number 2 is to consider results of compliance automatic of prime crest and royal crest apartments and take appropriate action.
>> and i've asked charlotte dodwell who is the manager of the apartments to attend and she's here to answer questions of the board. If you'll recall, last December was the last -- we had this issue before the board, the owner the apartment complex came and addressed their plans for regaining compliance on the -- with this complex. The principal issue was that they had not regained compliance on eligible tenants, and that -- that requirement is that 90% of the units have to be leased to tenants whose income do not exceed 120% of the Austin area median income. Their difficulties were -- first of all, they were late in addressing the issues in the cure letter that we sent and I think it was in October, and also they had so many vacant units that they were having difficulty in getting the proper documentation on these vacant units. And in discussing this with the board, there are really two apartment, prime crest which is now wood wind chase 2 and royal crest which is now wood wind chase 1 and they felt they could regain compliance on wood wind chase 1 in 60 days and on wood wind chase 2 in 120 days, and so the board granted them that extended time so in early this month, I went out to look at the files on wood wind chase 1, which they had -- miss dod wevmentell had related to me they had regained compliance of the eligible tenant requirements. I went out and looked at over 30 tenant files. I do -- I can report to the board that they have made substantial improvement in their -- in their efforts in their documentations. They were -- they were notarizing all of their income certification, they're ruizing -- they were using the right form. They were using the state form instead of the correct form. They had gotten income certifications on a lot of the existing tenants so they had made a concerted effort to regain compliance. They were only two issues that I did have a problem with. One was that the -- kind of the summary sheet that they provided me that lists all the tenants and their units, it did not designate whether -- how they were classifying that unit, whether it was a low income or eligible or -- or noncompliant, and it just -- it was just programmed to where they had -- it gave the total so -- so I felt that they, you know, for us to do a proper audit, we needed to know how they were designating each unit. Since I prepared this memo they have sent me corrected tenant rolls that do designate each unit so they really addressed this issue. The other -- the other issue I had was that when they started using the new income certification form they were not obtaining the signatures of all the adults that were moving in to a unit and that is, you know, that is a requirement that all the adults have to -- we have to know what their income is and they have to sign the form, the form -- the proper form they were to use only had one -- one signature line, so, you know, I suggested that they get a separate income certification from each of the tenants that move in and they said they would do that starting immediately. So what my suggestion is to the board is that when I go out and after the 120-day period which will be in mid April when I go out to examine wood wind chase 2 that I go back to wood wind chase 1 and make sure they have indeed obtaining separate income certifications from each of the different adults, tenants and the unit, so with that, if the board has questions of the apartment manager, or other suggestions...
>> congratulations. Thank you. I see it all.
>> so in conclusion, there is substantial progress but close to compliance or compliance?
>> I would say close to compliance with the eligible tenants.
>> so your recommendation as a follow-up visit to confirm, I guess, the steps that...
>> yes.
>> ... Apparently have been commenced.
>> yes.
>> ms. Dodwell, any comments?
>> so I would say we're 92% in compliance on phase I and 80.4% on phase 2, so we made a huge -- we're just almost there.
>> easing toward 100?
>> yes.
>> fortunately the rental market for this complex has improved a lot and that helped them out.
>> that's good.
>> yes, that's good.
>> we'll go with staff's recommendation. Anymore discussion? All in favor? That passes unanimously. Thank you for coming down.
>> thank you.
>> item number 3 is to consider and take appropriate action on request to execute a subordination of lien on a home project loan.
>> this loan -- this home loan was made in 1997 for $1,180. The -- the mortgage company contacted us and requested a -- that we execute a subordination of the lien. They are -- they are refinancing the loan. The -- the home buyer is getting a lower interest rate and actually is delinquent on his loan so he's kind of getting a second chance. He's not -- the owner is not -- he's not borrowing any additional money so this, to me, is -- is assisting the owner in maintaining his home ownership, subordination of leans are allowed by the state who gave the corporation the grant money and occasionally we have done this in the past. Also our attorney has reviewed the documents to make sure that the legal part of it is okay. I would recommend approving this.
>> under the same or similar circumstances with another person we would probably approve the request also?
>> yes.
>> in the name of fairness?
>> in the name of fairness.
>> second.
>> anymore discussion? You did say the state is okay with this?
>> yes, sir.
>> all in favor. That passes by unanimous vote. Number 4 is to consider and take appropriate action on housing initiative with lake view apartments to provide low cost housing for the elderly and adults with disabilities.
>> okay. I'm here with sherry Moore who is with the health and human services department. Late -- in late January we -- the board met regarding the annual fee for the lakeview apartments, and because they're -- there are a couple of years that have not been paid, and the board asked that we investigate -- or that I contact health and human services and look into ways that -- that we might be able to utilize some of the vacant apartment units who lease to people that are in need of housing and -- and so they -- they have -- they put us in contact or myself in contact with family elder care here in langley, who is here...
>> came right on time.
>> came right on time. And so what I have in the memo is a draft of a -- of an idea that we came up with that we wanted to discuss with the board to see if this was some, knowings something fees thabl we could do and it was-- here is basically the way it works. Family elder care, we would -- lakeview would reserve ten apartment units, family elder care would identify people that are in need of housing, and these would be people either that are elderly or -- or adults with disabilities.
>> Travis County residents?
>> Travis County residents and they would be -- and -- and they would be people that would be typically at or below 30% of the Austin area median income. The typical person would be, who might be their only source of income is social security, and they -- they're unable to obtain section 8 vouchers or other rental assistance, so they would be in, you know, in severe need of housing assistance. So they would refer these people to lakeview apartments, lakeview would do their same background checks, qualify them just like any other tenant, make sure they don't have a criminal history and all the other things, make sure they're a suitable tenant to lease their apartment, and if the -- if the tenant is approved and they want to live in the lakeview apartments, their rent would be calculated at 25% of their income. And -- and so then they would execute a 6-month lease agreement. They would fill out the income certification form, all the other things, the lease agreement would be just like any other tenant, and be able to move into the apartment. The -- the -- then lake -- family elder care and lakeview would coordinate as far as the services the tenant need, they would do their best to coordinate whatever services they would need, and also try to get them other housing assistance such as section 8 vouchers. What -- what we would do would be to -- to agree with lakeview that 80% of their normal rent would be -- they could take what rent they collected and subtract 80% of their normal rent and the difference they could reduce their annual fee that they owe the corporations. So for example, I think I have an example on the back here.
>> okay.
>> if the fair market value of ten units were -- was $10,000 -- I mean $6,000, and 80% of that figure was $4,800, and in my example, if the tenant's income is $1,000 a month, 25% of that is $250, so if there were tennessee nants, that would be $2,500, so the difference between 80% of the fair market rent and the actual rent collected would be $4,800 less $2,500 or $2,300. And so they would be allowed to reduce what they owe the corporation on their annual fee by that amount of money. And this -- so the -- in my little example here, the subsidy that would be provided by lakeview apartments, which is a choto, and hey are a 503 charitable organization. Their subsidy would be 20% of the rent which would be $1,200 and then the county corporations a public subsidy would be $2,300.
>> so that's...
>> now they owe us a total of how much, remind me of that? They owe us $50,000.
>> I think in the meeting in January, two year, it's about 26, $27,000 each year, and I think the board discussed, well, we might -- we might entertain a plan that reduces -- that took care of one of the two years, and...
>> so first we would eliminate that --
>> the old year?
>> yes, sir.
>> I guess that would give us an opportunity to reduce the program to see how it's working.
>> right. Right.
>> also i'll give lakeview a chance to generate the cash for the current year, and they're saying based on the vacancy rate they'll determine whether or not they can pay cash.
>> that's right. I think their occupancy rate is in the 60s and, you know, they really need to be able to fund everything. I think they need occupancy above 90%, so they have a ways to go.
>> we believe we can generate eligible travis coty residents for this program?
>> oh, yes, we already have started a list of potential tenants, and have at least 7 right now that we can refer immediately to and I just put the word out to the staff three days ago, so, you know, we're very excited about opening up more what i'd call truly affordable housing slots so that people who are retiring on social security can get in and afford to pay rent so, this -- you know, the way that we designed the rent scheme makes it very affordable, you know, if it's based on your income and you pay no more than 25%, then that's what hud deemed is the percentages that someone should pay for housing, so I -- I think it's, you know, a really fair and truly makes it affordable for seniors. Many of these tax credit projects that are being built, I don't mean to editorialize, even their lowest rents are over $700, if you're retiring on social security, your social security is between 530 and 780, you can't pay $700 in rent even though they figure it on their, because our msi is so high, you know, they're doing their hud formula right it's just our -- our median family income is so high right now.
>> how would you use referral to persons that need this housing assistance, how would you utilize the referral process to ensure that your outreach is available for the need?
>> low income and also persons withisabilities, how would you -- how would you achieve that?
>> that's a good question. I mean, the first people that we're serving right now and how we got an immediate list of 7 that we're able to send over, unit, we'll have probably 40 or so that we'll have on a waiting list nd I would want to let those senior nose if there are any slots on (n) lakeview where we can place them there, because these are already seniors who have already been deemed are income eligible for a hud 202 which means they're very low income. I don't think we're going to have any problem whatsoever between our elder shelter and the list that we willer have our lion's gardens senior housing project to fill it pretty fast. I mean immediately.
>> and in addition to staff with family elder care, even through our own county run programs, our social work staff daily encounters seniors who with our own programs you well know we're only in a position to help one or two times with their rental payments and most are desperately in need of situations where they can get the rent to an affordable level that they can manage within their income.
>> right.
>> so we would address our -- what you're saying really would address some of the social services that we're facing right now and it would probably end up enhancing our profession further outreach to ensure those basic needs are something that would be readily available with some of these...
>> right. As the court is aware we have 7 sites where we provide emergency assistance. We have four social workers. Generally when we have people on a fixed income who we see periodically for assistance with rent and utility, we provide them with hook ups like family elder care so we can get them to a more stable situation.
>> I know there's still a definite need for emergency assistance programs and things of that nature where senior citizens an others are asking for that.
>> absolutely.
>> especially with some of our other -- I think it would go a long way with what they're trying to do here.
>> avoid a scenario where early one morning a knock comes and a messenger says Travis County has been paid in full and got to move on today.
>> well, we -- we, and I'm sorry. Laura wingfield who is the executive director of agape foundation who is the owner of lakeview apartments and we did discuss that a little bit where what happens if -- what happens if the corporation says we rather have our money than -- or you all are doing well or whatever, and she -- she assured that we know that we are a 501(c)3 organization, we are -- we have a public service obligation and we would not kick out anybody or evict people that are in need of housing or that are there and so we would, you know, we would address that in a humane way.
>> the term of the lease would be...
>> six months.
>> yeah. And that gives an opportunity to relook at their income because they may, you know, in the interim the tenant may have gotten a job or gotten other you know, resources to where their income is higher and they could afford to pay higher rent.
>> is agape going to be responsible for plugging them into things like meals on wheels and other kinds of things or is that going to fall back to family elder care? Just kind of fill me in on who is going to handle, for lack of a better word, case management on this.
>> what is the word. It's service coordination so you're very close. Your questions, both of them, fit perfectly. My staff anticipation this could be too short of term housing and for seniors we need to look at long-term housing because moving around is not -- it's very hard on health. Put together a memorandum of understanding with agape and they've already run it by two times with agape staff and we have them with a three-year agreement, that they've agreed to continue this for three years and they are anticipating because of what mr. Davis said, they have only about a 60% ?cupancy, that there isn't going to be a problem with being too full within the next year, so they kept assuring us that they like this deal as much as we do, that they're in this business to provide affordable housing and they want to keep the arrangement as long as possible, in terms of who's going to do service coordination with the memorandum of understanding that my staff and their staff have worked out, kendra peters our service coordinator who has been doing it for 13 years has agreed to train their service coordinator in services for the elderly, and be a technical advisor -- they have on staff service coordination and provide manuals and resource materials. We've agreed to get everyone on a section 8 application and try to help so that, you know, we can keep them at that same location ultimately should they fill up and want to ask them to move out, they could use a section 8 voucher to stay.
>> yeah.
>> karin and I move in the same circle so to speak, and so hhs will continue to be a part of this process and help to support whatever efforts those tenants might need.
>> yeah.
>> through a basic needs collaboration that sherry is referencing, that is another place that we would definitely outreach. If there were any units unowpd the absolute first place we would go is to the basic needs collaboration which consists of meals on wheels and all the usual -- services of Austin, all the usual suspects, so we would then put it out and I know that we would fill it very fast. Yeah.
>> so lakeview is waiting on our approval to start the program?
>> yes, they were very positive to this program, again, I'm sorry that laura is not here, because she -- she did indicate she was coming, but they were very positive and wanted to...
>> her absence should not be read as a change of heart?
>> no. No.
>> approval of our pilot and thrilled that we were able to get creative about this and doing something for the public good but somebody has no cash but they have property, property works.
>> mr. Daugherty?
>> second motion by the way.
>> I'm glad that we're getting something out of it because it's great for the folks that need it. But we are going in the hole tremendously on a yearly basis, and I mean we have got to have some sort of plan as to how this is taken care of versus just saying y'all have got to wait until our occupancy gets to the point where we can do that. I mean this is $27,000 a year. I mean $2,300, we're not even -- I mean you can't even am that thing out and, you know, it get us where we need to be. I mean I'm -- I'm supportive of this because we've got to get something out of it and it's a wonderful program for the folks that can't afford anybody else, but I -- I'm afraid that we're missing, you know, our major goal here, and our major goal is how do we get that apartment complex to take care of its obligation with us? And I fear that we could get so pre-occupied with this because we're happy that we're being able to get something o of it, but, you know, we're -- we're -- I mean in one year you're still $46,000 in the hole and you're fixing to be another $27,000, I suppose is it each year?
>> no. Let me clarify in my -- I'm sorry that was not clear in my example, but that was a monthly amount. The $2,300 was a monthly reduction.
>> okay.
>> so for a year that would be...
>> 30,000?
>> yeah, you're getting close to taking care of a year's annual fee in a year.
>> if we look at, you know, rather than the coffers of the housing finance corporation, if we look at what could be the impact of ten more residents on our Travis County budget, we are helping to subsidize through our social service contracts family elder care, so it's like we are paying for these folks and I think the -- it's kind of like with emergency rooms, the most ek pensive form of care is through the emergency room or in this case the emergency shelter.
>> exactly.
>> a much more humane and cost effective approach is to put somebody in transitional/permanent housing and tie them into all the other safety net proposals and then that would free up space for folks who truly are in that emergency situation, which, whether we like it or not, is part of what Travis County's role is here, we have things that are our responsibility and being the safety net on the elderly and being the safety net on the end gent elderly, it's like this is -- this is our role.
>> and this is the -- this is not the norm. Most -- with the exception of one or two, everybody is paying their annual fees which is great and we're doing a lot of public good in this way, and this is one where in lieu of dollars the property gives us the public good which is what the officers are supposed to be looking out for, is the public good being respected here and unless we do something radical like this, what we've got here is somebody taking total advantage of the tax exempt financing and we are getting zero out of this deal, which is not a good situation.
>> and I will add that I have checked with the Travis County appraisal district and they have denied this apartment complex their tax exemption. The issue was they had not -- they are required to give the appraisal district a certified audit and they have -- I'm not sure what the reason is, but they have not been able to provide the appraisal district that audit. There is one other situation where we are past due on an annual fee, but it is one that I wouldn't -- I would not think it would be appropriate to entertain some plan like this. Because they -- they are going to be in a position of paying that fee.
>> well, I'm delighted for us to see how it works for a year. It was creative, I think it was the judge that actually thought about doing this, so that's...
>> old creative innovative judge.
>> good creative innovative chim upon. Upon -- champion. Just so we don't lose our real intent on this thing, but up until the time that the market gets better, I mean we're getting something what is god for folks that really -- that is good for folks that really need it. I'm glad we found a way to do that. I still want to keep them in line with what we're trying to get them to do.
>> and -- and should this motion pass, I assume that you would want cliff to prepare a contract that would, you know, we would put this idea into a contract form and we would come back to the board to have an actual contract agreed upon.
>> that would be my motion.
>> I think that is a good idea, but also -- I would like to also see what the impact would be if we had not done -- have not taken the action as we're doing today especially with these services primarily the care, because it definitely would have an impact on hhs as far as what we're doing now and then what we transition into do. I would like to see that. If I can get that information from y'all, I appreciate.
>> yes, sir.
>> any chance of getting you to waive the hourly fee.
>> all in the public good.
>> in the name of... Yes, sir?
>> no, just when I read the harvey's memo first, I had the same reaction Commissioner Daugherty did about it, $2,300, i've been corrected myself. It's really close to the annual fee.
>> all in favor. That passes by unanimous vote. Thanks. Keep us posted on this so we'll make sure that the results are as expected.
>> yeah. Of course we'll be back before you with the contract.
>> okay.
>> all in favor? That passes by unanimous vote. One more here, just in case. Now we have a list of corporations and come to all of them, the Travis County health facilities corporation, capital industrial the development, capital health facilities corporation, Travis County development corporation and the Travis County corporal education facilities finance corporation, let's call them all to order. The one item comes to all is to consider and take appropriate action to approve representation letter for deloitte and touche and it's the pretty much same explanation that we gave for the Travis County housing finance corporation that's why I move approval.
>> second.
>> anymore discussion?
>> all in favor? That passes by unanimous vote.
>> we adjourn all.
>> second.
>> all in favor. That passes by unanimous vote. With Commissioner Gomez absent.
Last Modified: Wednesday, March 17, 2004 7:22 AM