Affordability committee meeting.

In chambers, we have uh council member Alcorn, Councilmember Ramirez, and staff representing councilmember Castillo, our mayor Pro Tim Castix Tatum's office, staff representing Councilmember Kamen and Councilmember Jackson and Councilmember Twila Carter and Councilmember Martinez and Vice Mayor Pro Tem Peck is in chambers today.

So we'll hear from the housing and community development department, our multifamily division, assistant director Ryan Bibbs, and our deputy director, Derek Sellers.

Um, I'm gonna assume that director will join us or you'll provide closing comments.

Yes, wonderful, and then we do have four uh individuals that have signed up for public comments online, and if you wish to sign up for comments, you can do so at the table, and then we will read your name and you will have a three-minute maximum for your remarks.

And once your time has expired, you'll hear the bell, but we do welcome comments uh and visibility from all of our applicants at this time.

So we're gonna go ahead and get started, Deputy Director.

Welcome.

Good afternoon.

We're happy to be here to present the department's recommendations related to the nine percent tax credit process.

I'll provide some basic information about what nine percent tax credits are, and then uh deputy assistant director Ryan Bibbs will walk us through our recommendations.

So let's go to the next slide.

So tax credits provided by the federal government through the IRS to provide equity towards the construction of affordable housing.

The Texas Department of Housing and Community Affairs or TDHCA administers these federal tax credits and they award them through a competitive process.

Uh this competitive process is outlined annually by TDHCA through its qualified allocation plan or QAP.

Next slide.

So what we've provided to you here is a quick visual of what can be a complex funding structure.

Uh I'll go through it really quick for you.

In short, the developer applies to TDHCA for the tax credits using that QAEP QAP process I mentioned, and that's what we're here for today is we're a part of that process.

The city is as part of that is seeking resolutions of support.

Once awarded, uh once uh the TDHCA awards uh the tax credits to the developer, then they work with private investors uh to turn to exchange the tax credits in the uh for equity.

Uh the equity comes into the deal along with other sources such as conventional loans and financing, uh the developer equity or grants.

Sometimes the city provides grants as well into these deals, so that's kind of the funding structure that we have here.

Those tax credits are then realized for the investors over a 10-year period after the project is placed in service.

So they get the allocation every year for 10 years.

So let's go on to the next slide.

So the QAP and this process is very highly competitive.

Every single point matters.

And what we're here to talk about today are those resolutions of support that constitute 17 points as a scoring item.

Now, our resolutions for any development related uh that is here in the city can receive up to 17 points.

If in a uh one of these deals is located in the ETJ, then they must seek a resolution of support from the city and also from the county, and with each of them constituting half of the points towards that 17.

Next slide.

So there are two different types of tax credits that we typically look at 9% and 4%.

We're here for the 9% process.

We just wanted to make that clear to y'all as we talk about this today.

We routinely routinely throughout the year bring four percent deals forward to y'all.

We hold a public hearing and things like that.

Um that's not as competitive.

Uh it does require private activity bonds, but I just wanted to make sure we're all clear we're here for the nine percent portion.

So, along with our local government support that we're here for, there's also other items that are contingent items that they can receive points for.

I just wanted to point it out a couple of these because this often comes up in our conversations.

So, this includes community participation at four points and looking at in point input from community organizations at four points.

So, those are separate scoring items beyond our 17 that we're talking about today.

We also look at that when we determine a we have a scoring system for awarding that resolution, community inputs what we're looking for as well.

But that 17 points, you can see it is far outpacing everything else that's in this list.

If you don't get the 17 points, your deal will not go through.

It is vital.

Next slide.

So I just want to quickly revisit the schedule for this.

This schedule is based on the QAP, what TDHCA says is their deadlines within it.

Applications were due to us for the resolution process January the 12th.

Of course, we're sitting here February the 5th for the special called meeting, and we'll begin bringing these items to city council on the 11th.

So that's Wednesday of next week.

And that is their deadline.

So we're doing what we can to try to fit that.

Next slide.

So at this time I'm going to turn it over to Ryan to discuss our internal process and our recommendations this year.

Thank you, Dear.

Good afternoon, Chair, Pro Tim, Council members, and staff.

This next slide is going to discuss the priorities that we support for tax credit of elements.