MINUTES OF REGULAR MEETING OF
THE HEALTH, EDUCATIONAL AND HOUSING FACILITY BOARD
OF THE CITY OF MEMPHIS
Wednesday, December 7, 2016
The regular meeting of The Health, Educational and Housing Facility Board of the City of Memphis, Tennessee was held pursuant to public notice on Wednesday, December 7, 2016. The published meeting time was 12:00 Noon. The meeting was held at the Board office, 65 Union Avenue, Suite 1120, Memphis, TN 38103.
The following Directors were present:
Daniel T. Reid, Chairman Buckner Wellford
Carolyn Head Nancy Willis
The following Director was absent:
Also present were:
Staff members Martin Edwards and Lauren Magallanes were in attendance. Charles E. Carpenter, General Counsel, was also in attendance.
Hunter Nelson and John Shepard, representing Elmington Capital Group, were also present.
With a quorum present, the regular meeting of the Board was called to order at 12 Noon by the Chair, Daniel T. Reid. After reviewing the Notice of Public Meeting, the item number 5 listed as Affordable Multifamily PILOT Application for Kirby Pointe Apartments was struck from the agenda for consideration.
Approval of Minutes
Paige Walkup moved for approval of the Minutes for November 9, 2016. Curtis Thomas seconded and the motion passed unanimously.
Buckner Wellford entered the meeting
Finance Committee Report
Carolyn Head reported on the Financial Statements for the period ending October 31, 2016. He provided summaries of the income statement and balance sheet for the period and year to date.
Nancy Willis moved for acceptance of the Finance Committee Report for October 2016. Paige Walkup seconded and the motion passed unanimously.
Charles Carpenter stated no new claims or lawsuits since the previous Board meeting. Carpenter updated the Board on PILOT terminations, including Greenbriar Apartments and Rolling Hills Apartments, as both projects have graduated their ten (10) year terms. Chambliss Village PILOT termination was also executed, as the PILOT was previously found to be in default.
Carpenter reported the PILOT for Uptown Flats Apartments has closed and has been taken off the tax rolls. Carpenter also reported the PILOT(s) for South Main Artspace Lofts and Glendale Park (Ascension Towers) are in the final stages of their closing proceedings. Carpenter reported the PILOT Transfer for Abington Apartments (f/k/a Parkview) is scheduled to close in early January 2017.
Carpenter updated the Board regarding the bond default status of Hilldale Apartments, adding a notice of non-judicial foreclosure was received and the sale will take place December 9, to be managed by the Trustee, Wells Fargo. Carpenter reminded the issuance of bonds is on a non-recourse basis, with no legal or financial liability for the Board. Carpenter added the situation would continue to be monitored, to assure the proceedings are in adherence to the law.
Curtis Thomas reported Staff has renewed the contract with Ledford for compliance monitoring services and added Board and Staff have been pleased with their work. Thomas detailed the ongoing inspections of Macon Manor Apartments and Macon Pointe Apartments and stated significant progress on both properties. Martin Edwards added continued monitoring will be necessary, as there are challenges with parking lot standing water and ponding. Thomas and Edwards recommended a deferral of the Notice(s) of Default until May 1, 2017, as substantial rehabilitation of both properties has been completed.
Edwards stated Staff and Ledford have a PILOT property ‘watchlist’, which is an internal list of properties with moderate maintenance issues that are dealt with administratively to ensure property compliance. Buckner Wellford asked if a report might be presented each month detailing current properties on the watchlist, to which Thomas responded watchlist reports are given at the committee level.
CONSIDERAION OF BOND INDUCEMENT RESOLUTION FOR MASON VILLAGE APARTMENTS
Martin Edwards stated the PILOT for this project was approved in July 2016 and detailed the planned development in downtown Memphis. Charles Carpenter added the project is a joint venture with the Church of God in Christ, or COGIC. Carpenter and Edwards added their support of this transaction.
Paige Walkup moved for the acceptance of the Bond Inducement Resolution for Mason Village Apartments. Buckner Wellford seconded and the motion passed unanimously.
CONSIDERAION OF BOND INDUCEMENT RESOLUTION FOR FORUM FLATS APARTMENTS
Martin Edwards introduced Hunter Nelson and John Shepard, representing Elmington Capital. Shepard detailed the 178-unit garden style planned downtown development and added this would be the applicant’s sixth property in Memphis. Edwards praised the applicant on their quality developments and thorough application(s).
Curtis Thomas moved for the acceptance of the Bond Inducement Resolution for Forum Flats Apartments. Paige Walkup seconded and the motion passed unanimously.
CONSIDERAION OF AFFORDABLE MULTIFAMILY PILOT APPLICATION FOR FORUM FLATS APARTMENTS
Martin Edwards stated the PILOT committee recommended approval and reiterated the quality development(s) by the applicants. Carpenter stated the property is a Memphis Housing Authority PILOT and therefore will not count towards the Board’s allocation.
Curtis Thomas moved for the acceptance of the Affordable Multifamily PILOT Application for Forum Flats Apartments. Nancy Willis seconded and the motion passed unanimously.
Buckner Wellford asked to the process with the State’s involvement over Bonds and PILOTs, to which Carpenter responded the Tennessee Housing Development Agency oversees the volume cap for bond projects, while the City of Memphis provides the allocation for the PILOT program.
Hunter Nelson and John Shepard left the meeting
CONSIDERAION OF AFFORDABLE MULTIFAMILY PILOT APPLICATION FOR SUNRISE TERRACE APARTMENTS
Curtis Thomas reported the applicant has one (1) other PILOT property, Annie’s Townhomes, and is in good standing with the Board and recommended approval. Martin Edwards detailed applicant and property information in the Board packet.
Curtis Thomas moved for the acceptance of the Affordable Multifamily PILOT Application for Sunrise Terrace Apartments. Buckner Wellford seconded and the motion passed unanimously.
Carolyn Head asked if there was a preferred ratio of cost per unit in the presented projects; Martin Edwards responded he analyzes the cash flow reports of each project and takes into consideration new construction and rehabilitation verses that of market rate projects. Charles Carpenter added a requirement of the PILOT program is meeting at least 50% of the acquisition cost with detailed renovation costs and bond transactions are monitored by the debt service coverage.
Daniel Reid extended his appreciation on behalf of the Board for Carolyn Head taking on the role of Board Treasurer and for presenting the Finance Committee Report.
There being no further business, the meeting was adjourned by the Chair at 12:42 p.m.