ILLINOIS HOUSING DEVELOPMENT AUTHORITY FINANCE COMMITTEE MINUTES June 15, 2018

Transcription

1 ILLINOIS HOUSING DEVELOPMENT AUTHORITY FINANCE COMMITTEE MINUTES June 15, 2018 The meeting of the Finance Committee of the Illinois Housing Development Authority took place on June 15, 2018 at 111 E. Wacker Drive, Chicago, Illinois at 10:00 a.m. Attending the meeting were Ms. Mary Kane; Mr. King Harris; Ms. Luz Ramirez; Ms. Karen Davis; Mr. Sam Tornatore; Ms. Alyssa Rapp and Ms. Reyanna James, Intern to Ms. Alyssa Rapp for the members. Also attending the meeting were Ms. Jennifer Fredericks; Ms. Heidi Bowers and Mr. Maurice Campbell of BNY Mellon; Mr. Nick Vallorano and Mr. John Janicik of Mayer Brown; Ms. Barbara Feldman of Bank of America; Mr. Bruce Weisenthal of Schiff Hardin; Mr. Tom Coomes of Citigroup; Mr. David Petroni of PIRHL; Ms. Susan Jun of Morgan Stanley; Mr. Ryan Pollihan and Mr. Bob Cafarelli of Zions Bank; Mr. Patrick O Donnel of Huntington Bank; Mr. Sara Wick; Mr. Chris Longman; Ms. Kristen Collins and Mr. Charles Cole of Related. For the Authority staff, Ms. Nandini Natarajan; Ms. Audra Hamernik; Ms. Debbie Olson; Mr. John Chung; Ms. Vanessa Boykin; Ms. Tara Pavlik; Mr. Andrew Nestlehut; Mr. Andy Decoux; Mr. Scot Berkey; Mr. Tim Veenstra; Ms. Kathy Finn and Ms. Lily Benitez were present. Ms. Kane approved the May 18, 2018 Finance Committee meeting minutes as presented. Ongoing Activity Discussion: Monthly Interim Financial Statements. Ms. Boykin discussed the Authority s Monthly Interim Financial Statements by highlighting the Total operating revenues, Government reimbursements and Total operating expenses. Discussion: Multifamily Update. Mr. Decoux provided an update on the Authority s Monthly Multifamily Projects and Activities. Discussion: Homeownership Mortgage Program Update. Ms. Pavlik stated: Reservations for May 2018 at 765 first mortgage loans or $96.67 million; 307 mortgage loans or $41.75 million for GNMA and 458 mortgage loans or $54.92 million for Fannie Mae or conventional. 1

2 Ms. Pavlik presented a slide showing prior year reservation comparisons for the month of May Reservations in May 2017 were $34.4 million for GNMA and $52.1 million for Fannie for a total of just over $86.5 million. Ms. Pavlik continued: Through May 2018 and over the life of the program, 99.40% of all borrowers have been utilizing our Down Payment Assistant Program; we have a 20.39% fallout rate and our current pipeline is $ million. Overall 45% of our borrowers are using an FHA product, 1% for VA, 1% for USDA which is also in that GNMA bucket; 53% are Conventional. NEW BUSINESS Resolution Adopting Operating Budget for Fiscal Year Ms. Natarajan stated: We are pleased to present the Operating Budget for Fiscal Year Fiscal Year 2018 was a very successful year. We were able to offer an array of Multifamily and Single Family financing options. Our strategy for 2019 is to work from the inside out, focusing on improving organizational infrastructure within certain departments as well as our IT infrastructure and IT Strategy. Ms. Natarajan continued with the budget presentation with the following slides: - Operating Revenues for fiscal year 2018 Budget, fiscal year 2018 Actual and fiscal year 2019 budget. - Fiscal year 2018 Revenue Projections showing Origination / Allocation fees at $10.2 million; Ongoing fees at $9.3 million; Insurance fees at $865,000; Investment / Program Income at $27.3 million and Government Reimbursements at $17.8 million for a total of $65.6 million in Revenues and Reimbursements. - Operating Expenses for fiscal year 2017 Budget; fiscal year 2017 Actual and fiscal year 2018 Budget. - Fiscal year 2019 Expense Projections showing Salaries & Benefits at $34 million; Professional Services at $7.5 million; Financing Costs at $4.5 million; Office Administration at $3.7 million; Technology Management at $2.2 million; Training & Public Relation at $811,326; Site Visit & Travel at $435,504; Supplies & Subscriptions at $155,354 and Others at $404,380 for a total of just under $53.9 million in Total Expenses. - Government Reimbursement for fiscal year 2018 Expenses, fiscal 2018 Reimbursement and fiscal year 2018 Shortfall. 2

3 - Fiscal 2019 Government Reimbursements showing Affordable Housing Trust at $2.7 million; HOME at $2.1 million; Rental Housing Support at $309,979; National Foreclosure Mitigation at $76,636; Hardest Hit at $11.5 million; Foreclosure Prevention and Graduated at $386,334; Abandoned Properties Program at $240,202 and National Housing Trust Fund at $270,000; Project Reinvest at $67,969 and Land Bank Capacity Program at $74,199 for a total of just over $17.85 million in Government Reimbursements. - Operating Budget for fiscal year 2014 fiscal year Resolution Authorizing Agreement for Trustee and Custodian Services (Indenture Related). Mr. Nestlehut stated: This resolution is for an approval to enter into an agreement with Zions Bank to provide indenture related services as Trustee and Custodian for bonds that may be potentially issued by the Authority under a new indenture. Zions bank will enter into an Agreement with the Authority for a ten-year term in a not to exceed amount of $1.50 million. Resolution Amending Financial Management Policy. Mr. Nestlehut stated: This resolution is for the request to add First Tennessee National as a new counterparty and broker to the Financial Management Policy. Resolution Authorizing the Issuance of Multifamily Revenue Bonds (Cary Senior). Mr. Chung stated: This resolution is for Multifamily Revenue Bonds, Cary Senior Living. IHDA will only be involved in the permanent phase of the transaction only, and not during construction. This is a 9% transaction and IHDA will be providing permanent dinancing using this structure. IHDA will take out the construction financing provided by Citibank to provide financing during the permanent phase of this transaction by issuing bonds. The taxable construction loan from Citi will finance the acquisition and rehabilitation of Cary Senior containing 62 units located at 880 Feinberg Drive in Cary. The Refunding Bonds will be issued out of IHDA s Multifamily Revenue Bonds Indenture (series designation to be determined at the time of issuance and terms subject to a series indenture). The Refunding Bonds will be fixed rate, taxable, long term and backed by FHA risk share insurance, and to be rated Aaa by Moody s. The Refunding Bonds are intended to be issued at the time of project stabilization and receipt of FHA risk share insurance. Citi Community Capital will be the sole investor of the Refunding Bonds and the purchase will be governed by a forward bond purchase agreement. 3

4 The resolution request is for the authorization of Multifamily Revenue Bonds in an amount not to exceed $2.25 million, interest rate not to exceed 8% and a final maturity not later than June 1, Closing is projected for July 16, Resolution Authorizing the Issuance of Multifamily Revenue Bonds (Chelsea Senior Commons) and Resolution Authorizing the Issuance of Multifamily Housing Revenue Notes, 2018 Series A and 2018 Series B (Chelsea Senior Commons). Mr. Chung stated: This transaction is Multifamily Housing Revenue Note 2018 Series A and B and Multifamily Revenue Bonds for Chelsea Senior Commons. During the Construction phase, IHDA will issue two series of notes to finance the acquisition and construction of Chelsea Senior Commons, containing 40 units located at 55 Chelsea Avenue in Sugar Grove. Both Series of notes will be purchased by Citi Community Capital. It will be a conduit financing privately offered and tax exempt notes with Series A note being fixed rate and long term and Series B note being variable rate, short term. Both series will be issued as a limited obligations with no credit risk to the Authority. During the Permanent phase, IHDA will continue to provide financing during the permanent phase of this transaction by issuing bonds to take out the Multifamily Housing Revenue Note 2018 Series A. The Refunding Bonds will be issued out of IHDA s Multifamily Revenue Bonds Indenture (series designation to be determined at the time of issuance and terms subject to a series indenture). The Refunding Bonds are to be backed by FHA risk share insurance and rated Aaa by Moody s. The Refunding Bonds are intended to be issued at the time of project stabilization and receipt of FHA risk share insurance. Citi Community Capital will be the sole investor of the Refunding Bonds and the purchase will be governed by a forward bond purchase agreement. The resolution request is for the authorization of conduit notes, Series A in an amount not to exceed $2.5 million, interest rate not to exceed 8% and maturity no later than July 1, 2053 and Series B in an amount not to exceed $5 million, interest rate not to exceed 12% or the Illinois state maximum rate and maturity no later than July 1, The permanent bond request is for Multfamily Revenue Bonds in an amount not to exceed $2.5 million, interest rate not to exceed 8% and final maturity no later than July 1, Closing is projected for June 29,

5 Ms. Kane adjourned the meeting at 10:47 a.m. 5