friday april 19, 2013, at 9:00 a m - mhdcattn: jim farnsworth chairman: jeffrey s. bay (chairman)...
TRANSCRIPT
MHDC will make reasonable accommodations for persons with disabilities at the public site. To request an
accommodation, please contact Lynn Sigler at (816) 759-6622 or [email protected].
Notice is hereby given that the Missouri Housing Development Commission will conduct its annual
meeting at 9:00 AM on Friday, April 19, 2013, at
Stoney Creek Inn & Conference Center
Salon A
2601 S. Providence Road
Columbia, Missouri 65203
The tentative agenda of this meeting is attached to this notice.
The news media may obtain copies of this notice by contacting
Lynn Sigler
Missouri Housing Development Commission
3435 Broadway
Kansas City, MO 64111
(816)759-6622
ANNUAL MEETING
OF THE
MISSOURI HOUSING DEVELOPMENT COMMISSION
FRIDAY, APRIL 19, 2013, AT 9:00 A.M.
STONEY CREEK INN & CONFERENCE CENTER, 2601 S. PROVIDENCE RD., COLUMBIA, MO 65203
1. Roll call
2. Approval of Minutes
a. Approval of minutes for the regular meeting of February 15, 2013
3. Report of Chairman
a. Recommendation of Nominating Committee and Election of Officers
b. Audit Committee recommendation regarding selection of Audit Firm
4. Report of Staff
a. Financial Report and distribution of initial draft Budget for FY2014
b. Request for approval of selection of Bond Underwriters
c. Request for approval of selection of Master Servicer
d. Staff Recommendations for Housing First Program
e. Staff Recommendations for Homeless Management Information Systems (HMIS)
f. Rental Production Recommendations – Tax Exempt Bond Round
g. Rental Production Update
h. Asset Management Watch List Update
5. Such other matters that may come before the commission
6. Adjourn
ANNUAL MEETING OF THE
MISSOURI HOUSING DEVELOPMENT COMMISSION FRIDAY, APRIL 19, 2013 – 9:00 A.M.
AGENDA
TAB 1
Roll Call
Page 1 of 1 Rev. 01/03/13 dg
Governor:
Jeremiah W. (Jay) Nixon
Governor
State Capitol Building
P.O. Box 720
Jefferson City, MO 65102
573.751.3222
Attn: Ted Ardini
Brian May
State of Missouri
Office of the Governor
Wainwright Building, Room 929
111 North 7th
Street
St. Louis, MO 63101
314.340.7518
Lieutenant Governor:
Peter Kinder
Lieutenant Governor
State Capitol Building
Room 224
Jefferson City, MO 65101
573.751.4727
Attn: Pam Dixon
Brian Bunten
Treasurer:
Clint Zweifel
State Treasurer
State Capitol Building
P.O. Box 210
Jefferson City, MO 65102
573.751.8533
Attn: Angie Heffner Robyn
Sarah Swoboda
Attorney General:
Chris Koster
Attorney General
Supreme Court Building
207 W. High Street
P.O. Box 899
Jefferson City, MO 65102
573.751.3321
Attn: Jim Farnsworth
Chairman:
Jeffrey S. Bay (Chairman)
Van Osdol and Magruder, P.C.
911 Main St., Suite 2400
Kansas City, MO 64105
816.421.0644
Vice Chairman:
Troy L. Nash (Vice Chairman)
Zimmer Real Estate
1220 Washington Street, Suite 100
Kansas City, MO 64105
816.268.4230
Secretary Treasurer:
David B. Cosgrove (Secretary-Treasurer)
Cosgrove Law Group, LLC
8021 Forsyth Boulevard
St. Louis, MO 63105
314.563.2490
Commissioners:
Greg L. Roberts
The Roberts Law Firm
215 Chesterfield Business Parkway, Suite A
Chesterfield, MO 63005
636.489.4187
Missouri Housing Development Commission Roster
TAB 2
Approval of Minutes
MISSOURI HOUSING DEVELOPMENT COMMISSION Regular Meeting
Minutes of Meeting Held on Friday, February 15, 2013
A regular meeting of the Missouri Housing Development Commission was held on Friday, February 15, 2013 at 9:00 a.m., at the Stoney Creek Inn, 2601 S. Providence Road, Columbia, Missouri Those present were:
Commissioners and Persons Present to Vote for Ex-Officio Members
Jeffrey S. Bay, Chairman Clint Zweifel, State Treasurer Jim Farnsworth, Assistant Attorney General Troy Nash, Vice Chairman (via telephone) David Cosgrove, Secretary/Treasurer (via
telephone) Greg Roberts, Commissioner
Commissioners Absent Jay Nixon, Governor Peter Kinder, Lieutenant Governor Chris Koster, Attorney General
Staff Members Kip Stetzler, Interim Executive Director Greg Canuteson, Senior Deputy Director Tina Beer, Director of Operations Heather Bradley-Geary, Community Initiatives
Manager Marian Campbell, Director of Asset Management Diana Greener, Purchasing Supervisor Ron Hill, Accounting Services Manager James Kalthoff, Director of IT (via telephone) Sarah Parsons, Community Initiatives Assistant
Manager Marilyn Lappin, Director of Finance Jennifer Tidwell, Director of Policy and
Government Weylin Watson, General Counsel Bill Ulm, Director of Rental Production
Other Meeting Participants Brian May, Governor Nixon’s Office Sarah Swoboda, State Treasurer’s Office Brian Bunten, Lieutenant Governor’s Office
Chairman Bay called the meeting to order and roll call was taken by Ms. Beer. A quorum was present. The minutes from the commission meeting held on January 11, 2013 was presented for approval. A motion was made by State Treasurer Zweifel and seconded by Commissioner Roberts to approve the minutes. The motion passed unanimously with a vote of 6-0. Chairman Bay appointed Commissioner Roberts, Chairman Bay and Brian May to serve on the Nominating Committee. Commissioner Roberts will serve as Chairman of the committee.
Ron Hill presented the financial report as of December 2012 and a mid-year review of the Operating Fund budget as of December 31, 2012. Marilyn Lappin requested approval to extend MHDC’s agreement with bond counsel. A motion was made by Commissioner Roberts and seconded by State Treasurer Zweifel to extend the agreement for an additional year through April 2014. A roll call vote was taken and the motion passed unanimously with a vote of 6 to 0. Marilyn Lappin requested approval to extend MHDC’s agreement with financial advisors. A motion was made by State Treasurer Zweifel and seconded by Commissioner Roberts to extend the agreement for an additional year through July 31, 2014. A roll call vote was taken and the motion passed unanimously with a vote of 6 to 0. Marilyn Lappin presented the request to approve Bond Resolution No. 1030, Single Family Mortgage Refunding Revenue Bonds. A motion was made by State Treasurer Zweifel and seconded by Commissioner Roberts. The motion passed unanimously with a vote of 6-0. Marilyn Lappin presented the request to approve Resolution No. 1031 establishing a Tax-Advantaged Financing Compliance Procedure. A motion was made by Commissioner Roberts and seconded by Chairman Bay. The motion passed unanimously with a vote of 6-0. Heather Bradley-Geary presented a request to approve the Notice of Funding Availability for the Housing First program. A motion was made by Commissioner Roberts and seconded by Commissioner Nash. The motion passed unanimously with a vote of 6-0. Heather Bradley-Geary presented a request to approve the Notice of Funding Availability for administration of the HMIS system. A motion was made by State Treasurer Zweifel and seconded by Commissioner Roberts. The motion passed unanimously with a vote of 6-0. Weylin Watson presented a request to approve a modification of the Construction Completion Assurance Policy. A motion was made by Commissioner Roberts and seconded by Commissioner Nash. The motion passed unanimously with a vote of 6-0. Bill Ulm presented the rental production update. Marian Campbell presented the asset management watch list. No further business was discussed. A motion was made by Commissioner Roberts and seconded by Chairman Bay to adjourn. The meeting was adjourned. ________________________________________________ Jeffrey S. Bay, Chairman
TAB 3(a)
Report of Chairman Recommendation of Nominating Committee
and Election of Officers
TAB 3(b)
Report of Chairman Audit Committee recommendation regarding
selection of Audit Firm
April 19, 2013
Audit Committee Recommendation:
Selection of an Accounting Firm to provide Audit and Accounting Services
The RFP for Audit and Accounting Services was distributed on January 18, 2013 with responses due February 25, 2013. MHDC received proposals from five firms: BKD, CliftonLarsonAllen, Cochran Head Vick & Co., Mayer Hoffman McCann, and RubinBrown. Staff reviewed the proposals based on the criteria in the request for qualifications and proposals, giving focus to following: qualifications, HFA and other relevant experience, capacity to perform the MHDC audit, location including presence in the state of Missouri, prior experience with MHDC, disciplinary and litigation matters, special capabilities and fees. On April 3, 2013 the Audit Committee convened and reviewed staff’s recommendations regarding the proposals. Below is a synopsis about each firm. Proposed fees are summarized on the attached page. BKD LLP Primary Contact: Kimberly Hamm, Partner – Springfield, MO Minority participation: CMA Group, LLC – Overland Park, KS BKD provided a very well prepared proposal. BKD is a national firm headquartered in Springfield, Missouri and has additional Missouri offices in Kansas City, St. Louis, Joplin and Branson. BKD has experience and expertise in real estate, affordable housing, financial services and governmental accounting. BKD is an affiliate member of the National Council of State Housing Agencies (NCSHA) and has HFA clients, including Arkansas Development Finance Authority, Indiana Housing & Community Development Authority, and MHDC (fiscal years 2008 -2012). We have been pleased with BKD’s service. BKD has a strong government practice with such clients as the City of Kansas City, Missouri and has large financial institution clients, including Great Southern Bank. Kim Hamm, Partner and MHDC primary contact, has 25 years experience and is a member of BKD National Government Group and BKD National Construction & Real Estate Group. BKD includes a high level of partner, manager and supervisor involvement in their engagements. BKD’s proposed engagement includes minority participation via a subcontract with CMA Group, LLC, which has offices in Overland Park, Kansas, Kansas City, Missouri and Washington, D.C.
CliftonLarsonAllen Primary Contact: Mike Stephens, Partner – St. Louis, MO CliftonLarsonAllen is one of the nations’ top 10 firms with 3,600 professionals in 90 offices. Their proposal outlines staffing for MHDC’s audit work from their St. Louis and Baltimore offices. The St. Louis office has 138 employees. Current HFA audit clients include New Jersey Housing and Mortgage Finance Agency, Wisconsin Housing and Economic Development Authority, and Virginia Resources Authority. Mike Stephens, who has 27 years experience including housing, would be MHDC’s engagement partner-in-charge overseeing the work plan, coordinating activities of the audit senior managers and directing meetings with the Commission. Barbara DuBois would be MHDC’s relationship partner available to assist as needed. Audit managers will manage fieldwork personnel and resolve technical and reporting issues. Cochran Head Vick & Co. Primary Contact: David Cochran, Partner – Kansas City, MO Cochran Head Vick & Co. is one of the largest locally owned certified public accounting and consulting firms in the Kansas City metropolitan area. Cochran Head Vick & Co.’s clients include Housing and Economic Development Financial Corporation and Olathe Public Housing Authority. David Cochran, partner has 44 years experience including extensive government and not-for-profit audit experience. Proposed staffing includes a partner, manager, senior and two first-year staff. The firm size consists of 28 professionals and is smaller than the minimum 50 employee size outlined in our RFP. Mayer Hoffman McCann Primary Contact: Laurie Hopkins, Partner – St. Louis, MO Minority participation: Early Wilson – St. Louis, MO Mayer Hoffman McCann (MHM) is a national firm with 34 offices. MHM clients include NeighborWorks America, the U.S. Department of Housing and Urban Development and the Housing Authority of the City of Los Angeles. Their proposal outlines staffing for MHDC’s audit work from their St. Louis and Kansas City area offices with minority participation provided by Early Wilson of St. Louis. MHM’s staffing model consists of at least 25% shareholder and manager time. Laurie Hopkins with 25 years experience, including not-for-profit and government audits, would serve as MHDC’s lead engagement shareholder. Jeff Carlstedt with 17 years experience including real estate and LIHTC would be MHDC’s lead Kansas City shareholder.
RubinBrown LLP Primary Contact: Kaleb Lilly, Partner – Overland Park, KS Minority participation: Ralph C. Johnson & Company, P.C. - Kansas City, MO RubinBrown presented a well prepared proposal. RubinBrown is a regional firm headquartered in St. Louis and provided audit services to MHDC from 2000 to 2007. We were pleased with RubinBrown’s service during these audits. RubinBrown has strong governmental and real estate experience, serving such clients as the Missouri Department of Transportation, the Housing Authority of St. Louis County, the City of Lee’s Summit and over 2,000 real estate related entities. Kaleb Lilly has 14 years experience, including MHDC’s audit, and would serve as MHDC’s primary engagement partner. RubinBrown’s proposed engagement would be a joint effort of their St. Louis and Overland Park offices and includes minority participation provided by Ralph C. Johnson & Company, who has been on the MHDC audits since fiscal year 2000. Recommendation At its April 3, 2013 meeting the Audit Committee discussed the proposals with staff. Based on review of the proposals and applicable credentials, selection of either BKD or RubinBrown is a suitable choice. Both firms have solid credentials. BKD, being the larger firm, has additional resource depth experience, particularly in banking and with housing finance agencies. In addition, selection of BKD provides continuity and less internal costs of bringing an audit team up to speed and provides an opportunity for new minority participation with CMA Group. Accordingly, the Audit Committee recommends selection of BKD, with participation of CMA Group, LLC, to provide audit and accounting services for fiscal years 2013 - 2017.
BKD (includes expenses)MHDC Trust Fund Single Audit Total increase
FY2013 58,100 3,900 20,000 * 82,000$ FY2014 60,500 3,950 20,800 * 85,250 4.0%FY2015 62,900 4,200 21,600 * 88,700 4.0%FY2016 65,400 4,350 22,500 * 92,250 4.0%FY2017 68,100 4,400 23,400 * 95,900 4.0%
444,100$ CliftonLarsonAllen (includes expenses)
MHDC Trust Fund Single Audit Total increase FY2013 75,000 15,000 5,000 95,000$ FY2014 78,000 15,550 5,200 98,750 3.9%FY2015 81,100 16,200 5,400 102,700 4.0%FY2016 84,300 16,900 5,600 106,800 4.0%FY2017 87,600 17,600 5,800 111,000 3.9%
514,250$ Cochran Head Vick & Co.
MHDC Trust Fund Single Audit Total increase FY2013 57,530 5,000 18,500 81,030$ FY2014 59,255 5,150 19,055 83,460 3.0%FY2015 61,030 5,300 19,625 85,955 3.0%FY2016 62,875 5,460 20,200 88,535 3.0%FY2017 64,750 5,625 20,820 91,195 3.0%
$ 430,175 Mayer Hoffman McCann
MHDC Trust Fund Single Audit Total increase FY2013 66,600 16,200 27,200 110,000$ FY2014 68,500 16,780 28,000 113,280 3.0%FY2015 70,470 17,375 28,840 116,685 3.0%FY2016 72,500 17,990 29,710 120,200 3.0%FY2017 74,590 18,620 30,600 123,810 3.0%
$ 583,975 RubinBrown (includes expenses)
MHDC Trust Fund Single Audit Total increase add'l S.A. fee Total increase FY2013 51,000 4,000 9,900 64,900$ 5,000 * 69,900$ FY2014 52,500 4,100 10,200 66,800 2.9% 5,000 * 71,800 2.7%FY2015 54,100 4,200 10,500 68,800 3.0% 5,000 * 73,800 2.8%FY2016 55,700 4,300 10,800 70,800 2.9% 5,000 * 75,800 2.7%FY2017 57,400 4,400 11,100 72,900 3.0% 5,000 * 77,900 2.8%
344,200$ 369,200$
* RubinBrown's fee proposal includes only one major program for the Single Audit; their fee proposal includes an additional $5,000 for a second major program. It is anticipated that at a minimum there will be audit work for two major programs.
Fee Proposals for Audit and Accounting Services (2013-2017)
TAB 4(a)
Report of Staff Financial Report and distribution of initial draft
Budget for FY2014
FINANCIAL REPORT
FOR THE MONTH OF FEBRUARY 2013
Financial Reporting Package
for the month of February 2013 and the period then ended
Index Page: 1 – 2 Executive Summary for the month 3 Key Financial Information 4 Asset Quality 5 Balance Sheet
6 Budget for Use of Net Assets (Fund Balances) for Fiscal Year 2013 Mortgage Revenue Bond Activity HUD Purchase Loan Program
7 Condensed Statement of Revenue and Expenses for the month,
including the effects of GASB Statement No. 31 7a Condensed Statement of Revenues and Expenses for the month, actual
compared to budget (excluding the effects of GASB Statement No. 31)
8 Condensed Statement of Revenue and Expenses for the period July 1,
2012 to February 28, 2013, including the effects of GASB Statement No. 31
8a Condensed Statement of Revenue and Expenses for the period July 1,
2012 to February 28, 2013, actual compared to budget (excluding the effects of GASB Statement No. 31)
9 Loan Servicing Report
1
MISSOURI HOUSING DEVELOPMENT COMMISSION FINANCIAL REPORT - EXECUTIVE SUMMARY
February 2013
Assets Total assets, as reported, were $2,081,914,000 as compared to $2,195,550,000 at the end of the previous fiscal year. Excluding the effects of GASB Statement No. 31, assets totaled $2,002,390,000 at February 28, 2013 as compared to $2,101,027,000 at June 30, 2012. MHDC’s asset base continues to have a high-quality and low-risk profile. Approximately 43% of total assets are comprised of guaranteed mortgage-backed securities (page 4). MHDC has no subprime loans, no variable rate debt and no interest rate swaps or similar instruments. MHDC’s conservative asset base and careful management has MHDC well positioned in the current economic environment. Mortgages and Mortgage-Backed Securities The cost basis of new homeownership mortgage-backed securities purchased total $154.9 million in the fiscal year. Net of scheduled principal payments and loan prepayments, the cost basis of homeownership bond-financed mortgage-backed securities and loan portfolio has decreased $142.8 million in the fiscal year. In the Rental bond-financed program, one rental project loan was funded in the fiscal year. Principal pay-downs and prepayments in the Single Family Homeownership portfolio are 26% annualized (14% in 2012 and 17% in 2011). In the Multifamily Rental portfolio, principal pay-downs and prepayments are 4% annualized (16% in 2012 and 2% in 2011). Bond Issues and Other Debt During this fiscal year, four Single Family Homeownership bond issues totaling $174.2 million were closed, including one in March 2013. Two Multifamily bond issues in the amount of $49.3 million were closed (page 6). Bond pay downs have totaled $286.0 million. During this fiscal year, new FHLB Advances totaling $75.2 million have financed the MBS Warehousing Program. Results of Operations: Month of February For the month of February (page 7a), net operating results amounted to an increase of $1,496,000 before including the effects of GASB Statement No. 31, (see additional information below). Operating Revenue over Expenses is $905,000 more than budget. Results of Operations: Year-to-Date Fiscal 2013 Year-to-date for this fiscal year (see page 8a), net operating results amounted to a gain of $12,119,000 before including the effects of GASB Statement No. 31, (see additional information below). Operating Revenues over Expenses is $1,625,000 more than budget.
2
Federal Programs Year-to-date, Federal Grant Revenues include $85.0 million in Project Based Section 8 Housing Assistance Payments and $5.5 million in HOME Investment Partnership Program funds. These federal programs provide important resources for achieving the objectives of the Commission. The Commission’s efforts to preserve affordable housing, including preservation of the Housing Assistance Payment Contracts, are vital for continuing this economic resource for the State of Missouri. Effects of GASB 31 Governmental Accounting Standards Board (GASB) Statement No. 31 “Accounting and Financial Reporting for Certain Investments and for External Investment Pools” was instituted in 1998 and established fair value accounting for investment securities, such as U.S. government and agency securities; and GNMA, Fannie Mae and FHLMC mortgage-backed securities. GASB Statement No. 31 requires that these investments be reported at fair value on the balance sheet and that changes in fair value be reported as revenue in the operating statement. During periods of rising market interest rates relative to the stated rates of our portfolio, the fair value of our investments and mortgage-backed securities will decline. Conversely, when market interest rates fall below those of the stated rates of our portfolio, the fair value of our investments and mortgage-backed securities will increase. The required implementation of GASB Statement No. 31 has caused an increase of $2,446,000 in the fair value of investments and our mortgage-backed security portfolio during February (see page 7). During February, interest rates fluctuations have resulted in an increase in the fair value of mortgage-backed securities and other investments. Overall, the required implementation of GASB Statement No. 31 has caused a decrease of $13,361,000 in the fair value of investments and our mortgage-backed security portfolio during the fiscal year (page 8). During this fiscal year, interest rates fluctuations have resulted in a decrease in the fair value of mortgage-backed securities and other investments. Depending on future financial markets, we can expect interest rate fluctuations to have a continuing material effect on our financial statements.
Missouri Housing Development CommissionKey Financial Information as of February 28, 2013
($ in thousands) 2010 2011 2012 2/28/13Total assets * 2,259,015 2,192,899 2,011,310 1,913,554Total debt * 1,574,198 1,467,351 1,257,907 1,149,078Total equity * 561,600 592,210 627,377 635,748Revenues * 102,719 102,957 98,722 80,822Net income * 16,029 5,714 13,827 13,020Total loans and MBS 1,559,247 1,628,287 1,450,319 1,313,531FHA Risk-Share Loans 173,885 201,175 171,962 173,384Nonperforming assets 2,602 2,453 269 3,639Loan loss reserves 44,100 44,362 44,172 43,974
* NOTES:Asset values exclude conduit debt issues and are adjusted to eliminate the effects of market value accounting (GASB Statement No. 31).
Debt values exclude conduit issues.
Equity values are adjusted to exclude the effects of market value accounting (GASB Statement No. 31).
Revenue and net income values exclude the effects of market value accounting (GASB Statement No. 31) andfederal grants and assistance (pass-through revenues and disbursements). These values are projected for FY 2013.
6/30/2011 6/30/2012 FY 13 Budget 2/28/13PROFITABILITY (%)Return on Average Assets ** 0.26 0.66 0.26 0.66 Return on average assets, excluding subsidy programs & special initiative 0.99 1.03 0.48 0.74 Return on Assets before Loan Loss Provision and Extraordinary item 0.27 0.69 0.30 0.68 Return on assets before loan loss provision and extraordinary item, excluding subsidy programs & special initiatives 1.02 1.08 0.52 0.76 Return on Average Equity *** 0.99 2.27 0.87 2.06 Net interest margin 1.04 1.04 0.86 0.98 ASSET QUALITY (%)Non-performing assets / Total Loans, MBS and real estate owned 0.150 0.019 0.019 0.277 Loan Loss Reserves / Total Loans and MBS 2.72 3.05 3.09 3.35 Loan Loss Reserves / Risk-Share Loans and Non-Performing Assets 21.79 25.65 25.53 24.84 LEVERAGE (%)Total Equity / Total Assets 27.01 31.19 31.22 33.22 Total Equity and Reserves / Total Loans and MBS 39.09 46.30 47.09 51.75
** 1% Strategic Plan target*** 4% Strategic Plan target
Financial Ratio Analysis
Trend Analysis
Annualized growth rate of total assets is -7.29% at February 28, 2013, compared to -8.28% in FY12. Strategic Plan target is 5% annually.
3
Missouri Housing Development CommissionAsset Quality Information and Summary Effects of GASB Statement No. 31($ in thousands)
Balance Sheet 6/30/2009 6/30/2010 6/30/2011 6/30/2012 9/30/2012 12/31/2012 2/28/2013
Total Assets as Reported 2,310,391$ 2,439,078$ 2,378,078$ 2,195,550$ 2,131,224$ 2,106,393$ 2,081,914$ Unrealized gains/losses (effect of GASB 31) # (23,978) (80,873) (87,561) (94,523) (96,336) (83,628) (79,524)
Total Assets at Cost 2,286,413$ 2,358,205$ 2,290,517$ 2,101,027$ 2,034,888$ 2,022,765$ 2,002,390$
Mortgage-Backed Securities Portfolio 6/30/2009 6/30/2010 6/30/2011 6/30/2012 9/30/2012 12/31/2012 2/28/2013
Mortgage-Backed Securities at cost 1,176,642$ 1,130,195$ 1,151,375$ 1,000,022$ 918,664$ 897,440$ 854,162$ as % of Total Assets at Cost 51.5% 47.9% 50.3% 47.6% 45.1% 45.1% 42.7%
Mortgage-Backed Securities Portfolio Composition: % GNMA 75.3% 79.3% 83.6% 84.7% 84.8% 85.7% 85.6% % Fannie Mae 21.3% 18.0% 14.3% 13.4% 13.4% 12.6% 12.7% % FHLMC 3.4% 2.7% 2.1% 1.9% 1.8% 1.7% 1.7%
Loan Portfolio 6/30/2009 6/30/2010 6/30/2011 6/30/2012 9/30/2012 12/31/2012 2/28/2013
Total Loans at par 547,785$ 575,495$ 622,088$ 586,904$ 584,419$ 584,672$ 592,178$ Uninsured loans (includes Risk-Share, HOME & TCAP) 335,731$ 364,570$ 403,791$ 396,110$ 396,370$ 398,021$ 403,081$
as % of Total Assets at Cost 14.7% 15.5% 17.6% 18.9% 19.5% 19.7% 20.1%
Risk-Share loans 157,740$ 173,885$ 201,175$ 171,962$ 168,284$ 167,445$ 173,384$ HOME loans 151,818$ 159,226$ 172,449$ 182,685$ 183,180$ 183,018$ 183,691$ TCAP loans -$ 14,077$ 30,081$ 30,367$ 30,367$ 30,367$ 30,336$ Non-performing assets (uninsured) 599$ 2,602$ 2,453$ 269$ 115$ 3,014$ 3,639$
Allowance for loan losses 42,768$ 44,100$ 44,362$ 44,172$ 44,167$ 43,978$ 43,974$ as % of Uninsured/Non-guaranteed loans 12.7% 12.1% 11.0% 11.2% 11.1% 11.0% 10.9%
Asset Quality Ratios 6/30/2009 6/30/2010 6/30/2011 6/30/2012 9/30/2012 12/31/2012 2/28/2013
Non-performing assets / Total Loans, MBS and real estate owned 0.037% 0.167% 0.150% 0.019% 0.008% 0.223% 0.277%Loan Loss Reserves / Total Loans and MBS 2.67% 2.83% 2.72% 3.05% 3.22% 3.26% 3.35%Loan Loss Reserves / Risk-Share Loans
and Non-Performing Assets 27.01% 24.99% 21.79% 25.65% 26.23% 25.80% 24.84%
Fiscal Year Fiscal Year Fiscal Year Fiscal Year Year-To-Date Year-To-Date Year-To-Date2009 2010 2011 2012 Sep. 2012 Dec. 2012 Feb. 2013
Revenues over expenses 70,765$ 87,157$ 37,298$ 42,129$ 10,687$ 1,014$ (1,242)$ Reverse change in fair value (effect of GASB 31) # (49,686) (51,074) (3,524) (18,990) (2,548) 9,594 13,361 Revenues over expenses, excluding GASB 31 effects 21,079$ 36,083$ 33,774$ 23,139$ 8,139$ 10,608$ 12,119$
# - Effect of GASB Statement No. 31 reflects the changes in fair value of investments and mortgage-backed securities that result from changes in market interest rates.
Statement of Revenues & Expenses
4
Missouri Housing Development CommissionBALANCE SHEET, unaudited (In Thousands)February 28, 2013
Rental HomeownershipOperating Bond-Financed Bond-Financed
Funds Program Program February 28, 2013 June 30, 2012(audited)
ASSETS:
CASH AND TEMPORARY INVESTMENTS 45,446$ 26,073$ 183,036$ 254,555$ 223,049$
INVESTMENTS:Certificates of Deposit 4,600 6,000 - 10,600 3,000 Investment Agreements - 1,691 50,278 51,969 32,432 U.S. Government and Agency Securities 188,331 88,500 - 276,831 288,725
----------------------------- ----------------------------- ----------------------------- --------------------------------- --------------------------------- Total 192,931 96,191 50,278 339,400 324,157
LOANS RECEIVABLE, net of allowance for loan losses ($43,974) 288,146 268,481 922,467 1,479,094 1,630,601
OTHER ASSETS:Accrued Interest Receivable 2,148 1,240 3,635 7,023 7,662 Deferred Financing Charges 50 - - 50 8,169 Fixed Assets, net of accumulated depreciation ($3,809) 821 - - 821 976 Accounts Receivable, Other 1,203 (232) - 971 936
----------------------------- ----------------------------- ----------------------------- --------------------------------- --------------------------------- Total 4,222 1,008 3,635 8,865 17,743
----------------------------- ----------------------------- ----------------------------- --------------------------------- --------------------------------- Total Assets 530,745$ 391,753$ 1,159,416$ 2,081,914$ 2,195,550$
================ ================ ================ ================== ==================
LIABILITIES AND NET ASSETS:
LIABILITIESBonds and Notes Payable 38$ 270,606$ 967,270$ 1,237,914$ 1,347,624$ Interest Payable - 1,333 17,364 18,697 17,442 Escrow Deposits 10,604 88,528 - 99,132 96,046 Funds Due Others 329 - - 329 338 Accounts Payable 538 36 125 699 1,942 Deferred Fees 9,871 - - 9,871 10,258
----------------------------- ----------------------------- ----------------------------- --------------------------------- --------------------------------- Total Liabilities 21,380 360,503 984,759 1,366,642 1,473,650
NET ASSETSInvested in Capital Assets 821 - - 821 976
Restricted 230,019 31,250 174,657 435,926 457,533
Commission Designated (Unrestricted) 182,931 - - 182,931 172,144 Unrestricted and Undesignated 95,594 - - 95,594 91,247
----------------------------- ----------------------------- ----------------------------- --------------------------------- --------------------------------- Total Unrestricted 278,525 - - 278,525 263,391
Total Net Assets 509,365 31,250 174,657 715,272 721,900 ----------------------------- ----------------------------- ----------------------------- --------------------------------- ---------------------------------
Total Liabilities and Net Assets 530,745$ 391,753$ 1,159,416$ 2,081,914$ 2,195,550$ ================ ================ ================ ================== ==================
Combined Totals
5
BUDGET DISBURSED
Rental Housing Production and Preservation Program 7,000,000$ -$ Single-Family MRB Program Equity Contribution (see below for detail) 2,000,000 1,840,000 Bellefontaine Habilitation Center Rehabilitation Grant 2,225,360 * 210,436 Rental & Operating Assistance Program 485,000 68,453 Housing First Scattered Sites 776,385 152,343 Downtown Revitalization Plan 150,000 75,000 Disaster Credit Counseling 140,300 7,200 Disaster Assistance 100,000 - Multifamily and Home Improvement Interest Subsidy Program 4,000 1,153
TOTAL FUND BALANCE PROGRAM BUDGET 12,881,045$ 2,354,585$
* $9,787,220 funding committed to Bellefontaine Habilitation Center rehabilitation approved 10/8/2010; $2,838,268 disbursed in FY 2011 and $4,723,592 disbursed in FY 2012.
Authorized AppliedConstruction Lending 30,000,000$ (1) 10,830,000$ Single Family Homeownership Program 20,000,000 (2) 7,426,000 Homeowner Cash Assistance 21,500,000 (3) -
AMOUNT AMOUNT MHDCBOND ISSUES AUTHORIZED ISSUED CONTRIBUTION
Homeownership: 2009 Series E-5 - NIBP Program Bonds closed 12-19-12 30,000,000$ 30,000,000$ 840,000$ 2013 Series A Refunding Bonds closed 1-30-13 45,220,000 45,220,000 470,000 2013 Series B Refunding Bonds closed 1-30-13 54,010,000 54,010,000 530,000
As of February 28, 2013 $ 129,230,000 $ 1,840,000 2013 Series D Refunding Bonds closed 3-28-13 44,923,843 44,923,843 440,000
As of March 31, 2013 $ 174,153,843 $ 2,280,000
Rental: 2012 Series 1 Refunding Bonds closed 11-7-12 42,740,000$ 42,740,000$ -$ ** 2013 Series 1 (Friendship Village Apts.) closed 2-27-13 6,555,000 6,555,000 -
As of February 28, 2013 $ 49,295,000 $ -
** - financing costs funded from available program funds (no additional MHDC contribution required)
Mortgage-backed securities are purchased with short-term financing provided by the FHLB. After market bondsare issued, these MBS will be transferred to the SF NIBP and the FHLB advances repaid.
Mortgage-backed Securities warehoused as of February 28, 2013 6,908,782$ FHLB Advances as of February 28, 2013 -$ Pledged general investments 24,111,000$
Since the purchase of 26 loans from HUD during 1996, we have collected principal and interest paymentfunds, which are available for rehabilitation work and tenant initiatives. These are restricted funds.
Program Receipts, since 1996 25,645,381$ Grants and Loans, since 1996 (17,220,846) Available for Rehab/Tenant Initiatives as of February 28, 2013 8,424,535$
Fund Balance Revolving Funds as of February 28, 2013
HUD Purchase Loan Program
FY2013 Fund Balance Budget
Mortgage Revenue Bond Activity
February 28, 2013
MBS Warehousing Program as of February 28, 2013
(1) This revolving fund is used to make market‐rate multifamily construction loans.
(2) This established a $20 million fund to finance GNMA, Fannie Mae or FHLMC mortgage‐backed securities (MBS) in conjunction with MHDC's First Place bond program, or direct sale including forward delivery, as a source of continuous lending as approved at the April 17, 2009 Commission meeting. In addition, this fund will be utilized to finance MBS in conjunction with first‐time and repeat buyers from disaster areas as approved at the May 26, 2011 Commission meeting.
(3) This established funding totaling $21,500,000 for 3% cash assistance to fund homeownership closing costs and down payment. This cash assistance is recovered by means of the first loan rate or amortizing seconds. Recovered funds are recycled and reused for this same purpose. These funds include $1,000,000 earmarked for 5% cash assistance funding for borrowers from disaster areas as approved at the May 26, 2011 Commission meeting.
6
Missouri Housing Development CommissionCONDENSED STATEMENT OF REVENUE AND EXPENSES, unaudited (In Thousands)Includes the effects of GASB Statement No. 31For the Month Ending February 28, 2013
Rental HomeownershipOperating Bond-Financed Bond-Financed
Funds Program Program Combined
UnauditedREVENUES:Interest on Mortgage Loans 342$ 765$ 3,586$ 4,693$ Interest on Investments 369 30 159 558 Fair Market Value of Investments (1,011) 499 2,958 2,446 Administrative Fees 403 - - 403 Financing Fees and Other 451 - 743 1,194 Housing Trust Fund Receipts - - - - Grants & Federal Assistance 11,209 - - 11,209
----------------- ------------------------ ------------------------- --------------------Total Revenues 11,763 1,294 7,446 20,503
EXPENSES:Interest Expense on Bonds and Notes 4 656 3,334 3,994 Miscellaneous Bond Debt Expense 4 4 17 25 Compensation 705 - - 705 Administrative Expenses 290 - - 290 Provision for Loan Losses - - - - Housing Trust Fund Grants 172 - - 172 Grants & Federal Assistance 11,209 - - 11,209
----------------- ------------------------ ------------------------- --------------------Total expenses 12,384 660 3,351 16,395
----------------- ------------------------ ------------------------- --------------------REVENUES OVER (UNDER) EXPENSES (621) 634 4,095 4,108 FROM OPERATIONS
Subsidy Programs and Special Initiatives 166 - - 166 ----------------- ------------------------ ------------------------- --------------------
REVENUE FROM OPERATIONS AFTER SUBSIDY PROGRAMS & SPECIAL INITIATIVES (787)$ 634$ 4,095$ 3,942$
========= ============= ============== ===========
7
Missouri Housing Development CommissionCONDENSED STATEMENT OF REVENUE AND EXPENSES, unaudited (In Thousands)Excludes the effects of GASB No. 31For the Month Ending February 28, 2013
Actual Budget Actual Budget Actual Budget Actual Budget
UnauditedREVENUES:Interest on Mortgage Loans 342$ 515$ 765$ 900$ 3,586$ 4,250$ 4,693$ 5,665$ Interest on Investments 369 393 30 29 159 75 558 497 Administrative Fees 403 212 - - - - 403 212 Financing Fees and Other 451 217 - - 743 25 1,194 242 Housing Trust Fund Receipts - - - - - - - - Grants & Federal Assistance 11,209 11,881 - - - - 11,209 11,881
--------------- --------------- --------------- --------------- ------------------ ------------------ ------------------ ---------------Total Revenues 12,774 13,218 795 929 4,488 4,350 18,057 18,497
EXPENSES:Interest Expense on Bonds and Notes 4 3 656 777 3,334 3,917 3,994 4,697 Miscellaneous Bond Debt Expense 4 4 4 50 17 2 25 56 Compensation 705 769 - - - - 705 769 Administrative Expenses 290 455 - - - - 290 455 Provision for Loan Losses - 63 - - - - - 63 Housing Trust Fund Grants 172 267 - - - - 172 267 Grants & Federal Assistance 11,209 11,223 - - - - 11,209 11,223
--------------- --------------- --------------- --------------- ------------------ ------------------ ------------------ ---------------Total expenses 12,384 12,784 660 827 3,351 3,919 16,395 17,530
--------------- --------------- --------------- --------------- ------------------ ------------------ ------------------ ---------------REVENUES OVER (UNDER) EXPENSES 390 434 135 102 1,137 431 1,662 967 FROM OPERATIONS
Subsidy Programs and Special Initiatives 166 376 - - - - 166 376 --------------- --------------- --------------- --------------- ------------------ ------------------ ------------------ ---------------
REVENUE FROM OPERATIONS AFTER SUBSIDY PROGRAMS & SPECIAL INITIATIVES 224$ 58$ 135$ 102$ 1,137$ 431$ 1,496$ 591$
======== ======== ======== ======== ========== ========== ========== ========
Number of Employees: 110Number of Employees at Prior Year End: 112Compensation and administrative expenses as percentage of Total Revenue - actual 5.51%; budget 6.62%
CombinedOperating
Funds
RentalBond-Financed
Program
HomeownershipBond-Financed
Program
7a
Missouri Housing Development CommissionCONDENSED STATEMENT OF REVENUE AND EXPENSES, unaudited (In Thousands)Includes the effects of GASB Statement No. 31For the Eight Months Ending February 28, 2013
Rental HomeownershipOperating Bond-Financed Bond-Financed
Funds Program Program Combined
UnauditedREVENUES:Interest on Mortgage Loans 4,296$ 6,794$ 30,778$ 41,868$ Interest on Investments 3,014 245 1,011 4,270 Fair Market Value of Investments 5,780 (531) (18,610) (13,361) Administrative Fees 3,716 - - 3,716 Financing Fees and Other 1,966 2 2,364 4,332 Housing Trust Fund Receipts 3,344 - - 3,344 Grants & Federal Assistance 90,606 - - 90,606
------------------ ------------------------ ------------------------- ----------------------Total Revenues 112,722 6,510 15,543 134,775
EXPENSES:Interest Expense on Bonds and Notes 22 5,745 28,054 33,821 Miscellaneous Bond Debt Expense 25 607 1,204 1,836 Compensation 5,538 - - 5,538 Administrative Expenses 2,502 - - 2,502 Provision for Loan Losses - - - - Housing Trust Fund Grants 1,696 - - 1,696 Grants & Federal Assistance 89,900 - - 89,900
------------------ ------------------------ ------------------------- ----------------------Total expenses 99,683 6,352 29,258 135,293
------------------ ------------------------ ------------------------- ----------------------REVENUES OVER (UNDER) EXPENSES 13,039 158 (13,715) (518) FROM OPERATIONS
Subsidy Programs and Special Initiatives 724 - - 724 ------------------ ------------------------ ------------------------- ----------------------
REVENUE FROM OPERATIONS AFTER SUBSIDY PROGRAMS & SPECIAL INITIATIVES 12,315$ 158$ (13,715)$ (1,242)$
========== ============= ============== ============
8
Missouri Housing Development CommissionCONDENSED STATEMENT OF REVENUE AND EXPENSES, unaudited (In Thousands)Excludes the effects of GASB No. 31For the Eight Months Ending February 28, 2013
Actual Budget Actual Budget Actual Budget Actual Budget
UnauditedREVENUES:Interest on Mortgage Loans 4,296$ 4,115$ 6,794$ 7,197$ 30,778$ 34,000$ 41,868$ 45,312$ Interest on Investments 3,014 3,149 245 232 1,011 600 4,270 3,981 Administrative Fees 3,716 3,376 - - - - 3,716 3,376 Financing Fees and Other 1,966 1,740 2 - 2,364 430 4,332 2,170 Housing Trust Fund Receipts 3,344 3,200 - - - - 3,344 3,200 Grants & Federal Assistance 90,606 95,045 - - - - 90,606 95,045
----------------- ----------------- ----------------- ----------------- -------------------- ----------------- -------------------- -----------------Total Revenues 106,942 110,625 7,041 7,429 34,153 35,030 148,136 153,084
EXPENSES:Interest Expense on Bonds and Notes 22 28 5,745 6,216 28,054 31,332 33,821 37,576 Miscellaneous Bond Debt Expense 25 33 607 127 * 1,204 107 ** 1,836 267 Compensation 5,538 6,148 - - - - 5,538 6,148 Administrative Expenses 2,502 3,174 - - - - 2,502 3,174 Provision for Loan Losses - 498 - - - - - 498 Housing Trust Fund Grants 1,696 2,133 - - - - 1,696 2,133 Grants & Federal Assistance 89,900 89,787 - - - - 89,900 89,787
----------------- ----------------- ----------------- ----------------- -------------------- ----------------- -------------------- -----------------Total expenses 99,683 101,801 6,352 6,343 29,258 31,439 135,293 139,583
----------------- ----------------- ----------------- ----------------- -------------------- ----------------- -------------------- -----------------REVENUES OVER (UNDER) EXPENSES 7,259 8,824 689 1,086 4,895 3,591 12,843 13,501 FROM OPERATIONS
Subsidy Programs and Special Initiatives 724 3,007 - - - - 724 3,007 ----------------- ----------------- ----------------- ----------------- -------------------- ----------------- -------------------- -----------------
REVENUE FROM OPERATIONS AFTER SUBSIDY PROGRAMS & SPECIAL INITIATIVES 6,535$ 5,817$ 689$ 1,086$ 4,895$ 3,591$ 12,119$ 10,494$
========= ========= ========= ========= =========== ========= =========== =========
Compensation and administrative expenses as percentage of Total Revenue - actual 5.43%; budget 6.09%
* MF 2012 Series 1 financing costs totaling $488,000 expensed as incurred in accordance with GASB Statement No. 65** SF 2009 Series E-5, 2013 Series A & 2013 Series B financing costs totaling $1,098,000 expensed as incurred in accordance with GASB Statement No. 65
CombinedOperating
Funds
RentalBond-Financed
Program
HomeownershipBond-Financed
Program
8a
Loans Units RemarksRental Programs
FHA Insured 87 8,189 Includes FHA Insured, Section 8, Market Rate & Risk Share.
FNMA 20 675 Includes FNMA Participation Loans.
US Bank 53 - Includes US Bank Participation Loans
Uninsured 201 7,143 Includes Acquisition/Construction/Permanent Financing for Special Needs, Elderly & Family housingusing MHDC fund balances.
HUD Purchased Loans 28 712 Includes HUD Purchased Loans, special financing relating to the HUD Purchased Loan Program.
HOME Funds 388 11,673 Federal HOME Funds Construction Preservation non-profit and for profit and Federal HOME FundsEmergency Relief.
Housing Trust Fund 20 - Includes permanent financing for Family housing.
Rural Development Guaranteed 1 40 Includes a multifamily permanent financing.
Rural Initiative Loans 3 40 Rural Initiative Loan units are based on lots.
TCAP 24 709 Tax Credit Assistance Program.
TC Exchange 25 709 Low-income Housing Tax Credit Exchange Program.
Rental Program Totals 850 29,890
Homeownership Programs
GNMA Master Servicer 8,010 8,010 Serviced by Master Servicer, MHDC funded through MRB.
FNMA Master Servicer 1,327 1,327 Serviced by Master Servicer, MHDC funded through MRB.
FHLMC Master Servicer 153 153 Serviced by Master Servicer, MHDC funded through MRB.
MRB Issues 60 60 Serviced by Participant/Servicers. MHDC reconciles bank accounts, audits foreclosures and processes assumptions.
GNMA MRB Issues 685 685 Serviced by GNMA Contract Servicers. MHDC processes assumptions, servicing fees and audits foreclosures.
Rural Growth Master Servicer 8 8 Resolution 853 Serviced by Master Servicer, MHDC funded through MRB.
Cash Assistance Loans (CAL) 6,457 - Serviced by Master Servicer, MHDC funded; convert to grants over 60 months.
Tax Credit Advance Loans (TCAL) 546 - Serviced by Master Servicer, MHDC funded.
HOME Funds/Other 1,251 1,251 Includes MHDC DPA/MRB Issues/Flood Program Funds and Federal HOME Funds/FmHA, Weatherization andHome Improvement, Habitat for Humanity. MHDC performs all servicing functions.
Homeownership Program Totals 18,497 11,494
TOTALS 19,347 41,384
LOAN SERVICING REPORTAs of February 28, 2013
9
TAB 4(b)
Report of Staff Request for approval of selection of Bond
Underwriters
TAB 4(c)
Report of Staff Request for approval of selection of Master
Servicer
April 19, 2013 To: Commissioners Missouri Housing Development Commission From: Don Brinker, Homeownership Manager Re: Recommendation for Selection of Master Servicer
We have completed the process to select the Master Servicer for MHDC First Place Program. A total of two responses were received. We reviewed and evaluated the proposals taking into consideration qualifications and experience, particularly mortgage revenue bond servicing experience, regulatory standing, loss mitigation procedures and prices bid to pay MHDC for servicing rights. Respondents and Prices:
Service Release Premium Bid
Respondent
Insured & Guaranteed Loans @ .44% SF
Conventional Loans @ .25% SF
U.S. Bank Home Mortgage 1.41% .64%
ServiSolutions 1.50% 1.25%
U. S. Bank Home Mortgage, MRBP Division, headquartered in Bedford, Ohio, is well capitalized and has a highly experienced staff and mortgage revenue bond book of business. The bank appears to be well positioned to handle the current stresses in real estate and mortgage related industries. U.S. Bank Home Mortgage currently acts as Master Servicer for 26 state housing finance agencies. The bid from U.S. Bank Home Mortgage is actually on a sliding scale, the higher the mortgage rate the lower price, the lower the mortgage rate the higher the price. Also U.S. Bank Home Mortgage wants to reserve the right to reevaluate and change the pricing annually, which defeats our purpose of a three year contract. ServiSolutions is a division of Alabama Housing Finance Authority, which is headquartered in Montgomery, Alabama and is a state housing finance agency. ServiSolutions provides compliance, funding and loan review services. The company acts as master servicer to 1 other state housing finance agency and also services all of the loans originated for Alabama Housing Finance Authority. Being a division of a housing finance agency themselves, they are familiar with the unique challenges presented by our borrowers and properties. They have a staff of 25 people with an average of 20 years of mortgage banking experience generally coming from a much larger servicing organization. The agency currently services approximately 23,000 first and second mortgage loans. It also has a $75 million line of credit to purchase loans and warehouse loans until the securities can be delivered. ServiSolutions proposed pricing is fixed for the initial three year term. Recommendation for Selection: Based on ServiSolutions capacity to provide for MHDC’s single family servicing and their proposed service release premium, it is the recommendation of staff that ServiSolutions be selected for a period of three years with the option to extend for two additional years.
TAB 4(d)
Report of Staff Staff Recommendations for Housing First
Program
2013 Housing First Applications Recommendations
Balance of State Region
Grant Number: Agency Name: Site City: Amount Requested:13‐503‐CI Christian Associates of Table Rock Lake Kimberling City 64,000.00$ 13‐507‐CI The Kitchen, Inc. Springfield 75,000.00$
Totals: 139,000.00$
Kansas City Metro
Grant Number: Agency Name: Site City: Amount Requested:13‐500‐CI SAVE, Inc. Kansas City 66,000.00$ 13‐506‐CI reStart, Inc. Kansas City 121,332.00$
Totals: 187,332.00$
St. Louis Metro
Grant Number: Agency Name: Site City: Amount Requested:13‐502‐CI Sts. Joachim and Ann Care Service St. Charles 98,560.00$
Totals: 98,560.00$
Grand Total: 424,892.00$
TAB 4(e)
Report of Staff Staff Recommendations for Homeless
Management Information Systems (HMIS)
2013 HMIS Recommendations
Balance of State Continuum of Care
Grant Number: Agency Name: Site City: Amount Requested:13‐600‐CI Missouri Association for Social Welfare Jefferson City 29,904.60$
Totals: 29,904.60$
Jasper/Newton Counties Continuum of Care
Grant Number: Agency Name: Site City: Amount Requested:13‐601‐CI Economic Security Corporation of Southwest Area Joplin 3,295.00$
Totals: 3,295.00$
Springfield/Greene, Christian, Webster Counties Contiuum of Care
Grant Number: Agency Name: Site City: Amount Requested:13‐600‐CI Missouri Association for Social Welfare Jefferson City 455.40$
Totals: 455.40$
St. Charles, Lincoln, Warren Counties Contiuum of Care
Grant Number: Agency Name: Site City: Amount Requested:13‐602‐CI Community Council of St. Charles County St. Peters 16,000.00$
Totals: 16,000.00$
Grand Total: $49,655.00
TAB 4(f)
Report of Staff Rental Production Recommendations – Tax
Exempt Bond Round
TAB 4(g)
Report of Staff Rental Production Update
TAB 4(h)
Report of Staff Asset Management Watch List Update
Rental Production Watch List April 2013Asset Management Portfolio
MHDC Financed Portfolio 281,732,288
Federally Funded Portfolio 251,477,069 3/27/2013
TOTAL 533,209,357
Loan Balance 96.25%
513,203,963
Loan Balance
2.43%
Cardinal Apts/Lincoln
Housing
Lincoln Benton 1996 & 2011 Federal -
Uninsured /
Uninsured
759,800$ Occupancy Family 24 75% Market Low Lockwood
Group
93% 8% 1
Cedar Ridge aka Allison
Apts
Marceline Linn 1978 HUD-insured 205,635$ Occupancy /
Physical
Family 32 78% Market Low Housing
Authority of the
City of
Marceline
78% 100% 7
Drake Apartments Carthage Jasper 2006 Federal -
Uninsured /
Uninsured
548,768$ Occupancy Elderly 26 81% Market Low Carlson
Gardner, Inc.
93% 10% 1
Half Moon Village St. Louis St. Louis 1978 HUD-insured 939,210$ Occupancy /
Physical
Family 160 83% Owner Low Goralnik-Muskin
Properties
83% 100% 1
Lost Tree North Branson Taney 2006 Uninsured 919,141$ Occupancy Family 24 71% Market Low New Beginnings 90% 25% 1
Maple Avenue Independence Jackson 2002 Uninsured 437,470$ Occupancy /
Physical
Family 64 78% Owner/Market Low Cohen-Esrey
Historic Hsg
Rehab
Development
(FP)
90% 33% 10
O'Fallon Place 123 St. Louis St. Louis 1999 Guaranteed by
Fannie Mae /
Uninsured
8,726,552$ Occupancy Family 475 71% Market Low McCormack
Baron and
Associates, Inc
(FP)
93% 6% 3
Ozark Trails Ozark Christian 2007 Federal -
Uninsured
362,466$ Occupancy Family 32 81% Market Low Ingram
Investments
81% 100% 1
Perryville Manor
Apartments
Perryville Perry 2004 Federal -
Uninsured
388,809$ Occupancy Family 28 82% Market Low Carlson
Gardner, Inc.
93% 10% 1
Willow Point Concordia Lafayette 2002 Federal -
Uninsured
450,030$ Occupancy Family 32 59% Market Low Capstone
Development
(Ken Vitor) (FP)
90% 20% 3
12,978,081$
Cohen-Esrey (related party) serves as management agent. Decline in occupancy is primarily due to the decline in economic
conditions causing increased skips and evictions for non payment of rent. Management is offering incentives to attract
residents. Staff inspected the property in August 2012 and found the physical condition and overall management of the
property satisfactory. All inspection items needing correction have been reported by management as being corrected.
There were four applications received in March. Occupancy has remained the same since the last report.
Property is owner managed. Decline is primarily due to ownership neglect from a physical and management standpoint.
Property is jointly monitored by MHDC and HUD. MHDC staff last inspected the property in November 2012 and found the
physical condition, marketing techniques, and overall management of the property needing improvement. All inspection
items needing correction have been reported by management as being corrected. HUD last inspected the property March
2013 and cited the property for failure to maintain the property in good repair and condition. Ownership was given 60 days to
resolve all uncorrected items. Monthly marketing and traffic reporting information continue to be inadequate. Currently, there
are 10 applications pending;
McCormack Baron (related party) serves as management agent. Decline in occupancy is primarily due to the decline in
economic conditions causing increased skips and evictions for non payment of rent as well as for criminal activity. The
property is having difficulty attracting qualified residents. Property has a waiting list for the project based Section 8 units.
Staff inspected the property in May 2012 and found the physical condition, marketing techniques, and overall management of
the property to be satisfactory. All inspection items needing correction have been reported by management as being
corrected. There were 18 applications (7 pending) received in March and 9 move ins. Occupancy has remained the since
the last report.
Cohen-Esrey (related party) serves as management agent. Decline in occupancy is primarily due to the decline in economic
conditions causing increased skips and evictions for non payment of rent. Management is offering incentives to attract
residents. Staff inspected the property in October 2012 and found the physical condition, marketing techniques, and overall
management of the property needing improvement. All inspection items needing correction have been reported by
management as being corrected. There are 10 applications pending, and walk-in traffic and telephone calls have increased.
Occupancy has remained the same since the last report.
Property is managed by National Management Corporation. Decline in occupancy is primarily due to decline in economy. Management
reports that they are seeing more individuals choosing to live with relatives than obtain their own housing. Staff last inspected the property
in January 2012 and found the physical condition, marketing techniques, and overall management of the property needing improvement.
Currently, the property remains in noncompliance as the 2012 correction items are still unresolved. Staff has issued an 8823 reporting the
noncompliance. Walk-in traffic and telephone calls continue to be minimal. Three applications were received in March, and there is no
waiting list. Occupancy has remained the same since the last report.
PASS
% of
portfolio on
watch list
Risk Developer Overall
Portfolio
Occ Rate
ResponsibilitySPECIAL MENTION City County Loan Date Program Weakness
Loan Balances as of
Months
on List
COMMENTSType Total
Units
Occupancy
MACO serves as management agent. Decline in occupancy is primarily because the property was operating without a site manager for
approximately 3 months. A new site manager was hired six weeks ago, and the property has since increased advertising. Staff inspected
the property in November 2011 and found the physical condition, marketing techniques, and overall management of the property
satisfactory. All inspection items needing correction have been reported by management as being corrected. Currently, there are three
applications pending, and two move-ins scheduled for April. Walk-in traffic and telephone calls have increased.
Mid America (related party) serves as management agent. Decline in occupancy is primarily due to medical reasons and death. Staff
inspected the property in February 2013 and found the physical condition, marketing techniques, and overall management of the property
satisfactory. All inspection items needing correction have been reported by management as being corrected. Currently, there is one
application pending; walk-in traffic and telephone calls have increased.
Kodiak Management (related party) serves as management agent. Decline in occupancy is primarily due to deteriorating
market conditions, residents purchasing homes instead of renting, and occupancy being typically lower during the winter
months because of the tourism off-season. Staff inspected the property in February 2013 and found the physical condition,
marketing techniques, and overall management of the property satisfactory. All inspection items needing correction have
been reported by management as being corrected. Currently, there are two applications pending; and one unit pre-leased for
early April move-in. Walk-in traffic and telephone calls have increased.
Mid America serves as management agent. Decline in occupancy is primarily due to residents buying houses and unqualified applicants.
Staff inspected the property in December 2012 and found the physical condition, marketing techniques, and overall management of the
property satisfactory. All inspection items needing correction have been reported by management as being corrected. Currently, there are
six applications pending; walk-in traffic and telephone calls have increased.
Mid America (related party) serves as management agent. Decline in occupancy is primarily due to the decline in economic conditions
causing non renewals for non payment of rent. Staff inspected the property in December 2011 and found the physical condition, marketing
techniques, and overall management of the property satisfactory. All inspection items needing correction have been reported by
management as being corrected. Currently, there are six applications pending.
Rental Production Watch List April 2013
Loan Balance
1.32%
Ashley Park Kansas City Jackson 2006 Risk
Share/Federal
- Uninsured
6,402,313$ Occupancy
/Physical
Family 184 71% Owner/Market High Capstone
Development
(Ken Vitor) (FP)
90% 20% 23
Pevely Point Pevely Jefferson 2007 Federal -
Uninsured
625,000$ Financial Family 256 88% Owner High Pevely
Development,
LLC (Gundaker)
93% 14% 2
7,027,313$
Months
on List
COMMENTS
This property has failed to convert to permanent financing and is currently being managed by a court-
appointed receiver. MHDC was recently notified that Wells Fargo (lender) formally declared a default
and that foreclosure is scheduled for April 15, 2013. The property was originally developed, owned, and
managed by Gundaker, but is currently under receivership with Sansone. Wells Fargo is the current
lender because the construction loan is in default. To date, Federal and State Credit investors have
been unable to reach a deal with Wells Fargo to achieve permanent financing, MHDC has a soft 2nd
HOME note on the property. Property could not achieve permanent financing due to tough
market/economic conditions and management's reluctance to lower rents during tougher economic
times. Staff inspected the property in March 2013 and found the physical condition, marketing
techniques, and overall management of the property to be satisfactory. The property has excellent curb
appeal.
The reputation was poor prior to rehabilitation and management continues to struggle to overcome the
negative reputation. Ownership defaulted on the loan in December 2012. In February 2013, ownership
submitted a Partial Payment of Claim application to HUD for consideration. HUD has indicated June
2013 as a time period for potential resolution. Currently ownership is preparing responses to HUD's
initial review of the application. Staff inspected the property in January 2013 and found the physical
condition, marketing techniques, and overall management of the property needing improvement. All
inspection items needing correction have been reported by management as being corrected. Decline in
occupancy is due to evictions for non-payment of rent and illegal activity. In March 2013, MHDC
reestablished a security grant with the property to help with security until a decision is made by HUD.
Currently, there are 16 applications pending. Occupancy has decreased since the last report.
Overall
Portfolio
Occ Rate
Substandard
Adverse
Classification
Substandard
% of
portfolio on
watch list
Removed from the last report: FP-San Remo; St. Louis Brewery
CONCERNS:
(Substandard, Doubtful,
Loss)
City DeveloperOccupancyCounty Loan Date Program Weakness Responsibility RiskType Total
Units
TAB 5
Such other matters