Travis County Commissioners Court
June 17, 2008
Housing Finance Corporation
Let's call up the Travis County housing finance corporation. 1. Consider and take appropriate action on request to approve results of compliance audit of arboretum oaks apartment.
>> I'm mike gonzalez, senior analyst for the corporation. About two weeks ago staff was made aware of a pending transfer of ownership of one of our bond properties, arboretum oaks located next to the shopping center. A fairly routine request. Part of our due diligence,
>> [indiscernible] likes to go out and do a survey of all of the tenant files before it's closed on. Last week on June 10th the board had on their agenda consideration of the resolution to consent to the transfer. Of arboretum oaks from hamilton oaks to ibk, llp, at this time we presented our preliminary findings of the audit where we cited there were some compliance issues at the time. We reviewed 32 tenant files -- 31 tenant files, we found 31 to actually have deficiencies. The bigger issue is a little bit of a lax in documenting the income. Actual income certification itself. I believe at that time the board actually moved to conditionally approve the transfer to withhold the actual release of the documents and the -- to charge a $3,000 processing fee. Somewhat related to this. Again, we did find pretty significant compliance issues at the time. We did allow management to -- to provide documents to where they are showing how they would get back in compliance. They did provide or forward to us documents, but we still found that there was some deficiencies noted. The -- the -- pretty simply put, their income certification as described in their bond agreement is a two page agreement. Everything they forwarded was just one page, so they are actually missing half of the i.c. The reason that's such a big concern, on the second page is where a representative for the owner signs off saying that everything that they have ever -- they verified income, they do meet the requirements. The -- again, the issue we have before us today is strictly on the examination report itself. Staff does recommend approval of the examination report. Instead of doing a cure letter in 90 days or 60 days, which was on the -- on the memo that you all received, we would probably recommend to -- to -- a recommendation from the board for staff to go back out there and do a follow-up exam within six months. They are actually closing on this on the 19th. Going to be a new management company that comes in. It might be prudent for us to go back out there within six months and just see how the new management company is handling the requirements. Cliff blunt is here to -- on the related --
>> let me make sure that I understand. Are they in compliance with the low income tenants requirement or not?
>> right now we would not consider them in compliance with it. Just because they don't have the underlying documentation in the tenant files. Reviewing the tenant files it does appear that they do meet, if you kind of piece together all of the -- of the documentation they have, it seems like they have enough low income tenants to meet the threshold. This is an older property so -- so the requirements are pretty high. They have to be at 80%. 20% of the units have to be at the
>> [indiscernible] of the mif. For a family of four is 56,900. So it appears that they have sufficient numbers -- units to actually meet the low income requirements. They are just not doing a real good job of documenting as required by the agreement.
>> if we think that a sale to -- if they sell to other buyers, the new owner would pick up responsibility for compliance with -- with this --
>> yes, sir.
>> minor violation.
>> we have been in contact with our counsel quite a bit over the last couple of weeks when this issue came up, they are very attuned to it.
>> they want to close more than address this now, but they are promising to address it?
>> yes, sir, absolutely. I can get that in writing if you would like.
>> don't they legally have to.
>> they legally have to. One of the documents as part of this is concept and transfer agreement where the new buyer will agree to comply. They acknowledge the existence of the regulatory agreement. The document which puts the requirements on the property and they agree to abide by it contractually. We also get an opinion from their council that says that's an enforceable obligation.
>> with that I move approval of staff's recommendation.
>> second.
>> six months to comply.
>> y'all are not getting soft on us, are you?
>> no, sir.
>> [laughter]
>> the first one that we did --
>> now, I believe we've done it before, I can't speak for mr. Davis, but I don't believe so. That's why he's not here today, the real reason.
>> we are used to seeing y'all with a hammer. That's not half of a carrot. Any more discussion? All in favor? That passes by unanimous vote.
>> thank you all.
>> item no. 2 is to consider and take appropriate action on subordination of lien on a home down payment assistance loan.
>> back in July 18th, 2007, we had a home buyer participate in one of our programs, close on a home. As you all know they received a $10,000 forgivable loan. Two liens on placed on the actual residence. There's a second lien put on by the Texas department of housing and community affairs for 8 thousand dollars. There's a third lien through the Travis County finance corporation for 2,000. What they are trying to do is do an fha streamline refinance. When they -- when they refinance and obviously the original mortgage gets paid off, which may -- which may trigger that amount be repaid, the $10,000 or whatever amount is not forgiven yet. So they are requesting that we subject gate our lien to the new refinance mortgage. I did visit with the Texas department of housing and community affairs, they have already authorized subject gating their lien to the new mortgage that's being placed. Their biggest requirement is that that -- just that the protection that they have on the -- on their grant, the $8,000 is not lessened in anyway, that's staff's opinion is if we subordinate our lien in this case, there is no risk or there's no weakened coverage for wounds.
>> questions.
>> move approval.
>> any discussion? My discussion of the motion?
>> $2,000.
>> all in favor? That passes by unanimous vote.
>> move adjourn.
>> thank you very much.
>> all in favor? That carries unanimously, also.
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Last Modified:
Tuesday, June 17, 2008 2:31 PM