Program Evaluation Report (PER) P. Baker / Y. Brabham 28 August 2017

Transcription

1 Program Evaluation Report (PER) P. Baker / Y. Brabham Installation Management Command integrates and delivers base support to enable readiness for a globally-responsive Army We are the Army s Home Serving the Rugged Professional Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 1 of 23

2 Agenda Program Evaluation Report (PER) PER Components PER Completion PER Timeline Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 2 of 23

3 PER Report 10 U.S.C. Section requires the Secretary of Defense to periodically report on the performance of Military Housing Privatization Initiative (MHPI) programs to Congress Program Evaluation Report (PER) 2884(c) Report Semi-Annual 2884(c) Report Statutory reporting requirement due to Congress enabling monitoring of certain performance metrics Internal to the Office of the Secretary of Defense (OSD) Allows OSD to monitor the Services housing privatization programs Provides current project structure, demographic, financial, and operational data along with long-term financial outlooks for each MHPI project Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 3 of 23

4 PER Report Data for the PER submittal are as of 30 September each year, and covers the entire fiscal year (01 October through 30 September) Information on RCI FH, RCI UH, and PAL projects submitted PER is in Enterprise Military Housing (emh) and all information is submitted through emh for OSD Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 4 of 23

5 PER Components The Program Evaluation Report (PER) is divided into three (3) components PER Current Data Sheet PER Long-Term Project Outlook (Long-Term Data Sheet) 2884(c) Report Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 5 of 23

6 PER Components (Continued) PER Current Data Sheet Contains basic data about the structure of the project along with demographic, financial, and operational information Includes construction and renovation numbers, government services, occupancy, waterfall, debt and loan data, and resident survey information Populated with as of data, either as of the end of the fiscal year (30 September) or for the last quarter in the reporting period (third quarter) Line Question 1 Location (City and State) 2 PROJECT OVERVIEW 2a Total # of Base Housing Units Before Privatization (Units/Spaces) 2b Total # of Units Transferred (Units/Spaces) 2c Total # of Units Replaced 2d Total # of Units Renovated 2e Total # of Units Transferred with No Initial Work 2f Deficit Reduction (#) (Units/Spaces) 2g Total # of Units Demolished or Sold Without Replacement (Units/Spaces) 3 Total # of Units Privatized (Units/Spaces) 3a Total # of Inadequate Units Eliminated 4 Total # of Base Housing Units After Privatization (Units/Spaces) 5 Project Term (Yrs./Mos.) 6 Closing (Mo./Yr.) 7 IDP Completed (Mo./Yr.) 8 Construction 9 New Construction Completed (#) 10 New Construction Scheduled for Completion (#) 11 Renovated Completed (#) 12 Renovation Scheduled for Completion (#) 13 GOVERNMENT SERVICES 14 Fire (Yes/No) 15 Police (Yes/No) 16 Utilities - Gas (Yes/No/NA) 17 Utilities - Electric (Yes/No) 18 Utilities - Water (Yes/No) 19 Utilities - Waste Water (Yes/No) 20 OCCUPIED UNITS 21 Military Families (#) 22 Military Unaccompanied (#) 23 Military Retirees (#) 24 Civil Service (#) 25 Civilians (#) 26 MILITARY HOUSING DEMOGRAPHICS 27 Enlisted Families (E1-E6) 28 Enlisted Families (E7-E9) 29 Officer Families (O1-O10)(W1-CW5) 30 Total Military Families 31 OCCUPANCY AND DSCR 32 Units Available for Occupancy (#) 33 Occupied Units (#) 34 End of Reporting Period Occupancy Rate (%) 35 Debt Service Coverage Ratio (DSCR) on 1st Mortgage (#) 36 Debt Service Coverage Ratio (DSCR) on 1st Mortgage Plus 2nd Mortgage (#) Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 6 of 23

7 PER Components (Continued) PER Long-Term Project Outlook (Long-Term Data Sheet) Provides estimates of the financial health of the MHPI projects for the next 5 years, the next 25 years, and the remainder of the project Tracks expected capital requirements to properly maintain, repair, and renovate the projects and compares those amounts to the expected sources of funds Information to be included begins as of the previous year PER report cutoff date Populated with cumulative data for the year or an average of data for the period Program Evaluation Report Long Term Project Outlook Project: FT RILEY Period End: 09/30/2016 Status: CERTIFIED Capital Sources ($ Millions) IDP Current/Approved ($ Millions) ($ Millions) (85) Private Debt $283.6 $283.6 (86) Government Direct Loan (GDL) (87) Total Debt (Lines 85+86) $283.6 $283.6 (88) Private Equity $4.0 $4.0 (89) Government Cash Equity $123.0 $123.0 (90) Total Equity (Lines 88+89) $127.0 $127.0 (91) Other Development Funds $142.3 $142.3 (92) Total Sources (Lines ) $552.9 $552.9 Annual Operating Summary ($ Millions) (93) Date of Financial Statement (Mo./Yr.) 10/16 From Budget From Fin Stmt (94) Effective Gross Income $59.7 (95) Operating Expenses $26.3 (96) Net Operating Income (NOI) (Line 94 Minus Line 95) $33.4 $0 (97) Cumulative Reinvestment Account Balance ($) Cumulative Next 5-Year Capital Plan (98) 5-Year Capital Plan - Reporting Period (Mo./Yr.) to Capital Requirements ($ Millions): # of Units $ / Unit Total ($ Millions) (99) 5-Year Capital Plan - Capital Requirements - Demolition (100) 5-Year Capital Plan - Capital Requirements - New Construction (101) 5-Year Capital Plan - Capital Requirements - Major Renovation Total Requirement Total ($ Millions) (102) 5-Year Capital Plan - Capital Requirements - Capital Repair and Replacement ($) (103) 5-Year Capital Plan - Capital Requirements - Ancillary Facilities ($) (104) 5-Year Capital Plan - Capital Requirements - Total Capital Requirements ($) Starting Balance Deposits & Interest 5-yr Cumulative Sources ($ Millions): ($ Millions) ($ Millions) ($ Millions) (105) 5-Year Capital Plan - Sources - Capital Repair and Replacement Account ($ Millions) (106) 5-Year Capital Plan - Sources - Reinvestment Account ($ Millions) $15.9 $15.9 (107) 5-Year Capital Plan - Sources - Additional Private Debt ($ Millions) (108) 5-Year Capital Plan - Sources - Other ($ Millions) (109) 5-Year Capital Plan - Sources - Total Sources ($ Millions) $15.9 (110) 5-Year Capital Plan - Surplus/(Deficit) ($ Millions) (Line 109 Minus Line 104) $15.9 Year 6 thru Lease Term Capital Plan Entries (111) Year 6 thru Lease Term Capital Plan - Capital Requirements ($) Sources : (112) Year 6 thru Lease Term Capital Plan - Sources - Capital Repair and Replacement Account ($ Millions) (113) Year 6 thru Lease Term Capital Plan - Sources - Reinvestment Account ($ Millions) (114) Year 6 thru Lease Term Capital Plan - Sources - Planned Debt/Equity ($ Millions) (115) Year 6 thru Lease Term Capital Plan - Sources - Other ($ Millions) (116) Year 6 thru Lease Term Capital Plan - Sources - Total Sources ($ Millions) (117) Year 6 thru Lease Term Capital Plan - Sources - Surplus/(Deficit) ($ Millions) Performance Outlook and Business Strategy Entries (118) Operating Performance Average occupancy for the period was 91.2% as compared to 92.4% last period and 2016 Budget of 91.2%. Yrs 6~25 Remaining Lease ($ Millions) Term ($ Millions) Revenues were $59.7M for the period compared to 2016 Budget of $57.6M, representing a favorable variance of 3.6%. Operating Expenses were $17.9M compared to Budget spending of $16.6M, representing a favorable variance of 7.8%. The favorable variance in operating expenses is due in part to the reduction in staffing and lower than anticipated T/O costs. The 2016 Budget was used as a base line rather than the Proforma, as it only ran thru Jun of The ODP has been delayed until the completion of Bldg. 45 renovation, which is expected to be completed in Dec. The 2016 Budget bases its operating expense figures on an average 4,288 homes online vs. the 4,260+ actual homes online in FY16. NOI was $35.0M compared to 2016 Budget of $31.5M, representing a favorable variance of 11.1%. The average DCR decreased to 1.65 this period from 1.79 last period. The Project has completed all 2,117 new homes. All 387 homes in the Ellis M/D have been completed as well. Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 7 of 23

8 2884(c) Report PER Components (Continued) Semi-annual report submitted to OSD for Congress in mid-april and mid-october of each calendar year Contains an evaluation of the status of oversight and accountability measures for military housing privatization projects Responses developed from existing RCI Project reports, identifying the following: Projects where more than 20% of work orders are backlogged and timeline and cost for completing Post-IDP Projects with DCR of less than 1.0 or occupancy rate less than 75% for 12+ months Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 8 of 23

9 PER Components (Continued) Responses developed from existing RCI Project reports, identifying the following (continued): Post-IDP Projects with negative variances greater than 25% between actual and pro forma deposits to the Project s Reinvestment Account Post-IDP Projects with unplanned or unbudgeted withdrawals that are greater than 20% of the Project s Reinvestment Account balance As assessment of the information requested in items 1 through 4 if not provided, and an explanation of why information was not provided How Projects assess utility usage and cost to residents and how residents are reimbursed or charged according to their assessed usage Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 9 of 23

10 PER Report Completion Housing Managers / RCI Asset Manager completes and submits both Current Data and Long-Term Data sheets Current Data Sheet (only selected, unlocked fields in MS Excel format) Long-Term Data Sheet (only 3 unlocked fields at the bottom in MS Excel format) Top section of Long-Term Data sheet that covers pro-forma projections and FY operating performance will be completed at HQDA level Critical PSR information is summarized into three paragraphs on Operating Performance, Capital Performance and Other Actions at bottom of PER Long-Term Data Sheet Information in most fields will be locked and will not require update by Housing Managers / RCI Asset Managers (RCI AMs) PER Instructions should be utilized to answer any questions during completion Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 10 of 23

11 PER Report Completion Fields Requiring Updating Data in the Project Overview section will generally not require update Information Rows 1, 2a- 2g, and 3a should remain unchanged Current Data Sheet Line Question Answer 1 Location (City and State) Junction City, KS 2 PROJECT OVERVIEW 2a Total # of Base Housing Units Before Privatization 3114 (Units/Spaces) 2b Total # of Units Transferred (Units/Spaces) c Total # of Units Replaced d Total # of Units Renovated 860 2e Total # of Units Transferred with No Initial Work 537 2f Deficit Reduction (#) (Units/Spaces) 400 2g Total # of Units Demolished or Sold Without Replacement (Units/Spaces) 3 Total # of Units Privatized (Units/Spaces) a Total # of Inadequate Units Eliminated Total # of Base Housing Units After Privatization 3514 (Units/Spaces) 5 Project Term (Yrs./Mos.) 50 Yrs. 6 Closing (Mo./Yr.) 7/1/ IDP Completed (Mo./Yr.) Jun-2016 P 0 Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 11 of 23

12 PER Report Completion Fields Requiring Updating Current Data Sheet Comparison of to-date deliveries to approved pro forma deliveries Resident demographic breakout of waterfall tenants Resident demographic breakout by rank Line Element Project X 8 CONSTRUCTION 9 New construction completed (#) New construction scheduled for completion (#) Major renovation completed (#) Major renovation scheduled for completion (#) 125 Line Element Project X 20 OCCUPIED UNITS 21 Military Families (#) Military Unaccompanied (#) Military Retirees (#) Civil Service (#) Civilians (#) 0 Line Element Project X 26 MILITARY HOUSING DEMOGRAPHICS 27 Enlisted Families (E1-E6) Enlisted Families (E7-E9) Officer Families (O1-O10) (W1-W4) Total Military Families 411 Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 12 of 23

13 PER Report Completion Fields Requiring Updating Current Data Sheet Line Element Project X 31 OCCUPANCY AND DSCR 32 Units available for occupancy (#) Occupied units (#) Average occupancy rate (%) 93.6% 35 DSCR on 1 st mortgage (#) DSCR on 1 st mortgage plus 2 nd mortgage (#) N/A Line Element Project X 68 REMAINING PRINCIPAL BALANCE 69 Senior Mortgage ($) $54 70 Junior Mortgage ($) N/A 71 Reinvestment Account 72 Outstanding Litigation (Yes/No) N/A 73 Short Term Outlook (5 Years) Calm 74 Long Term Outlook (6-25 Years) Calm Line Element Project X 79 TENANT SURVEY 80 Effective Date of Survey (Mo./Yr.) 5/2015 Number of Tenants Surveyed this Reporting 81 Period (#) Recommendation for Newly Constructed Units Recommendation for Newly Renovated Units Recommendation for Unrenovated Units 372 Occupancy and DSCR (DCR) information Remaining loans balances, reinvestment account deposits as % of pro forma projections and outstanding litigation (if applicable) Tenant survey results Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 13 of 23

14 PER Report Completion Fields Requiring Updating Long-Term Data Sheet Summary of operating performance (Section 118) First paragraph provides information about average occupancy this PER period, average occupancy last period and pro forma occupancy expectation for this PER period (118) Operating Performance: Average occupancy for the period was 93.8% as compared to 89.5% last period and pro forma of 91.4%. Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 14 of 23

15 PER Report Completion Fields Requiring Updating Summary of operating performance (Section 118) (Continued) Second paragraph includes: Long-Term Data Sheet First sentence on actual versus pro forma revenues, with explanations for unfavorable variances Second sentence discusses actual versus pro forma operating expenses, with explanations for unfavorable variances Third sentence discusses actual versus pro forma net operating income (NOI), with explanations for unfavorable variances Fourth sentence includes average DCR this PER period versus average DCR last period (118) Operating Performance: Revenues were $13.8M for the period compared to pro forma of $16.2M, representing an unfavorable variance of 14.8%. The unfavorable variance in revenues is due to more higher ranking homes than budget being vacant as well as concessions being offered. Operating Expenses were $6.3M compared to pro forma spending of $5.6M, representing an unfavorable variance of 12.5%. The unfavorable variance in operating expenses is due to higher turnover costs and higher than budgeted utility expenses. NOI was $7.5M compared to pro forma of $10.6M, representing an unfavorable variance of 29.2%. The unfavorable variance in NOI is due to a combination of lower revenue and higher operating expenses. The average DCR (first mortgage) increased to 1.99 this period from 1.90 last period. Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 15 of 23

16 PER Report Completion Fields Requiring Updating Long-Term Data Sheet Summary of operating performance (Section 118) (Continued) Third paragraph includes sentence on actual versus pro forma new construction deliveries, with explanations for unfavorable variances. Second sentence discusses actual versus pro forma major/medium renovations, with explanations for unfavorable variances (118) Operating Performance The Project has completed 210 new homes compared to pro forma expectations of 210 new homes. The Project has also completed 65 major/medium renovations compared to pro forma expectations of 125 major/medium renovations. Delays in renovations are due to funding issues and it is expected that these delays will be addressed through a recently submitted Major Decision Memorandum requesting approval of the use of surplus IDP funds for renovations. Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 16 of 23

17 PER Report Completion Fields Requiring Updating Long-Term Data Sheet Summary of capital performance (Section 119) First sentence provides information about the status of the Reinvestment Account balance versus pro forma expectations (119) Capital Performance: The balance of the Reinvestment Account is zero because all funds are being utilized to fund the construction account for the Project during the IDP. Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 17 of 23

18 PER Report Completion Fields Requiring Updating Other actions (Section 120) Long-Term Data Sheet If applicable, include information about ongoing litigation Always include the Safe Harbor statement about long-term forwardlooking statements in the example below (120) Other Actions: N/A. This PER Long-Term Data Sheet contains forward-looking statements, the achievement or success of which involves risks, uncertainties, and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, the results of this MHPI project could differ materially from the results expressed or implied by the forwardlooking statements made in this PER document. Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 18 of 23

19 IMCOM IMCOM reviews the report for accuracy and completeness IMCOM ensures the Housing Manager / RCI Asset Manager submits the report on time Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 19 of 23

20 PER Report Timeline Mid-September: PER Current & Long-Term Data Sheets and OSD instructions to RCI AMs Late September: Tele-training on PER templates (if needed) 30 September: End of PER Reporting Period 1 November: Housing Manager / RCI Asset Manager PER submissions due to OACSIM Program Manager via emh 1-15 November: Review and validate PER submissions November: Portfolio data consolidation and report development 1 December: Army consolidated PER reporting package sent to OSD Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 20 of 23

21 Wrap Up Questions? Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 21 of 23

22 Wrap Up Reviewed the PER Discussed the Components of the PER Who is responsible for completing and reviewing the PER Went through the timeline for PER submission Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 22 of 23

23 End of Brief Patricia Baker / ACSIM / (571) / patricia.a.baker76.civ@mail.mil 23 of 23