HomeMy WebLinkAbout8255RESOLUTION NO. 8255
A RESOLUTION APPROVING AN AGREEMENT BETWEEN
THE CITY OF PUEBLO AND PUEBLO COUNTY BOARD FOR
DEVELOPMENTAL DISABILITIES FOR THE CONSTRUCTION
OF 28 UNITS OF MULTIFAMILY HOUSING IN ACCORDANCE
WITH THE HOME /CDBG CONSOLIDATED PLAN CALLING
FOR AN AFFORDABLE HOUSING STRATEGY FOR LOW AND
MODERATE INCOME HOUSEHOLDS BELOW 80% AREA
MEDIAN INCOME UNDER THE 1997 HOME INVESTMENT
PARTNERSHIP PROGRAM
WHEREAS, the City of Pueblo, pursuant to the HOME Investment Partnership Act, the
Craston - Gonzales National Affordable Housing Act; 42 U.S.0 12701 et seq; and implementing
regulations under 24 CFR 92, has been a recipient of HOME federal funds under the program since
1992; and
WHEREAS, in accordance with the provisions of the Act and 24 CFR 92 92:200 a portion
of such financial assistance, subject to appropriation by the City Council, may be made available to
non - profit organizations for the purpose of carrying out specific elements of the City of Pueblo
housing strategy including the expansion of the availability of affordable housing for low and
moderate income Pueblo residents; and
WHEREAS, at the Council Work Session held on October 14, 1997, City Council listened
to a request for funding from the Pueblo County Board for Developmental Disabilities in the amount
of $175,000 from HOME federal funds for the purpose of carrying out the construction of 28 new
multi - family units more fully described in Exhibit "A "; and in accordance with the provisions of the
Act and 24 CFR 92 92:200, the HOME funds are encouraged to be used under a partnership with
non - profit organizations;
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PUEBLO,
COLORADO, that:
SECTION 1.
The City Council of the City of Pueblo approves $175,000 in HOME federal dollars to
Pueblo County Board for Developmental Disabilities, Inc., a Colorado Non - Profit Corporation for
project costs in accordance with Exhibit "A" attached, and the City Manager of the City of Pueblo
is authorized and directed to execute an agreement with the agency for the development of the 28
newly constructed multi - family units.
ATTEST:
City Clerk
INTRODUCED: October 27 1 1997
By Samuel Corsentino
Councilperson
President cfthe C ty Council
1
PROJECT NARRATIVE
BALTIMORE APARTMENTS
Project Overview
The developer proposes the development of a 28 -unit housing project located in the Northwest
Pueblo area. The new housing units are 1050 square feet town homes with three bedrooms and
two bathrooms. Two units will be fully accessible for the disabled. This neighborhood in
Northwest Pueblo is experiencing a severe need for quality affordable housing for low /moderate
income persons. The surrounding area has experienced significant growth in retail chain stores
whose employees are income eligible for the proposed units. This development would meet an
urgent housing need as identified by the City of Pueblo.
Sift Control
The project is proposed for construction on a parcel under contract by the developer. The four
acre site is properly zoned for the proposed development and all infrastructure is in place
including street paving, curb and gutter, sidewalks, water, sewer, gas, electric, cable and
telephone service.
Developer /General Contractor
The developer team, Pueblo Board for Disabilities and the National Development Council, will
jointly develop the project and have considerable experience in the development, construction
and management of affordable housing utilizing a variety of private and public financing
programs. Pueblo Board for Disabilities is recognized statewide in the services delivered to their
clients. NDC is recognized nationally as one of the leaders in the development of quality
affordable housing using LMC's and other public funds. NDC presently owns and manages in
excess of 500 units. NDC has also committed to providing equity to the project.
The developer has obtained the services of Hurtig, Gardner and Froelich (HGF) for architectural
services and they will assist in the selection of a qualified General Contractor. HGF recently
supervised construction of 52 units in Fremont County utilizing identical design and feel very
comfortable with the cost estimates provided.
Use of Funds
The project will be approximately $3,144,076.
Land Acquisition
S 442,000
New Construction
1,694,000
Site Improvements & New Construction
322,200
Architectural & Engineering
82,350
Contingency
150,000
Developer Fee
305,000
Other Expenses
Construction Interest
40,620
Construction Insurance
5,406
Environmental Study
2,500
Tax Credit Application Fee
6,500
Cost Certification
2,500
Legal Fees
33,000
Appraisal
8,000
Property Tax
5,000
Title & Recording
10,000
Inspection Fees
10,000
Permanent Loan Fees
5,000
Operating Reserve
20,000
Total Other Expenses
148,526
Total Development Costs
S 3,144,076
Debt Financing
The developer has obtained permanent and construction financing from Pueblo County Board
for Developmental Disabilities based on the following. Permanent financing was based on a
9.5% rate on a twenty year term in the amount of $578,923. Public sector financing will also be
provided thru the Colorado Division of Housing HOME program in the amount of $280,000, the
City and County of Pueblo in the amount of $350,000, and $98,000 in Federal Home Loan Bank
Affordable Housing funds. HOME funds will be at the applicable federal interest rate and
deferred until cash flow allows repayment. The developer will also lend $170,848 on a 100%
residual receipt of excess cash flow. The developer is also requesting a loan of $580,000 to be
used for construction financing.
Proforma
The project will provide the first mortgage lender with a debt coverage ratio of 1.15 to 1 based
on a Net Operating Income of $82,869 calculated below.
Gross Rent
$ 165,336
- Vacancy
(8,267)
Effective Gross Rent
157,069
- Operating Expenses
Administrative
10,200
Advertising
1,000
Legal
1,500
Water
6,500
Sewer
1,500
Gas
16,000
Grounds
4,000
Electric
10,000
Insurance
4,000
Taxes
5,000
Maintenance
6,300
Management
11,000
Trash
1,400
Operating Expense
4,200
Net Operating Income
74,469
- Debt Service 1st
-- 64,756
-Debt Service Soft Mortgages
9,713*
Cash Flow
0
*Residual receipts loan of 100% of excess cash flow. This allows the developer access to cash
of up to approximately $9,000 per year to provide cash to the project for any emergency that
may arise on the project.
Rents were projected at $503 /month on rental units at 50% of median income and $452 /month
on rental units at 40% of median income. Rents include all utilities.
Expenses were estimated at $2,950 per year per unit.
Sources of Funds
Project Costs
- Equity Investors
- Pueblo County Board for Developmental Disabilities
- City and County of Pueblo)
- Federal Home Loan Bank
Colorado Division of Housing
Developer Fee Loan
Financing Gap
$3,144,076
(1,666,076)
(578,923)
(350,000)
( 98,000)
(280,000)
(170,848)
0
r
Colorado Housing and Finance Authority w_. e trees
Denver, Colorado 80202 -1272
303 - 297 -2432
August 28, 1997
Mr. Larry Velasco
Pueblo Cnty Board for Developmental Disabled /NDC
115 West Second Street
Pueblo, CO 81003
RE: BALTIMORE.APARTMENTS
Allocation Year: 1997
Application Cycle: 2
Dear Mr. Velasco:
On August 28, 1997, the Colorado Housing and Finance Authority's
Board of Directors approved a Preliminary Reservation of
Low - Income Housing Tax Credits for the above - referenced project.
Type of LIHTC requested: New, No Federal Subsidy
Annual Credits Requested: $ 238,232.00
Annual Credits Approved: $ 238,044.00
As stated in the Colorado Low - Income Housing Tax Credits
Qualified Allocation Plan, Section VI.A, a reservation fee of two
percent of the annual credit amount reserved to your project is
due prior to the issuance of the Preliminary Reservation letter.
Please submit $4,760.88 by September 12, 1997.
The Reservation expires on December 31, 1997, is not assignable
to another applicant or housing project, and will become
effective upon receipt of the reservation fee.
Please be aware that all projects receiving preliminary reser-
vations in the second round will be required to meet all
carryover requirements, including ten - percent expenditures, by
December 1, 1997, without exception. Please send the payment to
my attention, LIHTC, at Colorado Housing and Finance Authority.
If you have any questions, you may contact me at (303) 297 -7378,
or toll free (800) 8'77 -2432.
Sincerely,
Shirley Robins
Tax Credit Allocations Officer
-t
Based on Probable Cost Figures Presented by HGF for the Baltimore Project
Construction Costs of 28 Housing Units
28 units @ 1,110 sf per unit - 30 sf @ S55 sf — $1,694,000
$1,694,0004-28 units = $60,500.00 per unit (includes excavation and back811)
Construction Cost of SiteworkiWalk&Wad/Basc
5322,200.0028 units = $11,507.00 per unit
Coast of ArchitecturaUEngineexing Fees
582,350 -28 units - $2941.00 per unit
Construction Casts for the 28 routs are $74,948.00 /unit or $67. S2/sq.ft.
Land Costs
83% of the land is used for the housing project at $367,280
5367,280 units — $13,117.00 per unit
Adding in the Cost of the land, brings the cost/unit to $88,065.00 or $79.34 sq.ft.
4- - t
Construction Cost of Family Center Building and Sitework, ArcNtect" Fees wid I rA of the
land cost: $782,226.00
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