 Morning everybody. Thank you for being here We're here obviously this morning to talk about adopted policy and criteria to consider inclusion of Real property in a multi-county industrial part to apply to Richland County special resource revenue credit incentive to real property Within the corporate limits of city of Columbia for the development of rental Portable and work housing projects, which I think is important for all of us And that's why we're here today. I did want to Maybe defer to staff here first if they wanted to provide us any briefing any updates I know we just got some emails from several people Including folks from the Columbia Housing Authority Gwynne Huns Registrar as well that we're all just now getting a chance to read but You see I don't know if you want to start off as the Assistant city manager for that department and deferred to Christian and Gloria to kind of talk through the background And kind of the feedback and how we got here maybe go through some of these points that y'all think are pertinent that we may discuss and then We'd like to get some feedback obviously from the folks that are here So if we can kind of maybe go through the background Talk about how we got to where we are and then I think maybe we can defer to the folks To talk about concerns questions observations that they think are pertinent so that we can move forward This is a second version of a draft resolution for y'alls review and input so the Objective is to incentivize affordable housing projects that include blended Rather than centralized all low-income and low-income in a particular area We really want to see it blended which is the model that I think most communities are going with we did incorporate changes Through the last time the committee met I'm going to talk more specifically about that. They work together on a lot of those changes I think the ordinance is a good bit shorter, but probably more concise Areas of focus that council is asking for and we have gotten some feedback from the community a lot of developers who work in this area We also have been made aware that the county has passed an ordinance for affordable housing So we're looking into How the two relate to each other. I think ours will be more specific which was what we did for student housing There's more Project specific We sort of set larger parameters and put projects on by one as they met those So just to clarify when you say project specific have they written an ordinance that only is going to They're going to continue to do things for a project It looks like it looks like it on their ordinance was basically recognizing that they want to So we intend to work with them to understand both how ours How we can incorporate This would work better Process probably would not deem itself any way to I think I think that's got some ideas of how we can you know what we currently have and what we Think Number of people that are currently on And I didn't know if maybe that was In terms of what we intended to do as it relates to that wait wait Information was placed there just to say that there's certainly a need In the whereas too correct That And it pretty much aligned with Verification that Probably Can we jump to number one just one of the questions that it comes up a couple times in the emails I've seen the question of What's behind that why? How does that that translate into units development? So I think two things, you know for eight million Berries we have a project under construction right now that I believe is 54 units and it's around $10 million Not a calculation That met this criteria that we were trying to attract Scale of those projects, so we wanted to make sure that Projects that we were aware of that if this had been in place at the time they were getting started Comments we had from Wade McIan was it shouldn't be based on 8% cap rate not a Man as stated is how would that how would that Gregory we've just seen this Some of these as well We'll make sure that we capture your smile on camera So cap rate is like the inverse 8% cap rate So if it's a million dollars in a while 8% What would you support doing it by 8% of the cap rate instead of setting a figure of 8 million dollars with that more be more We can do a floor Just because this was gonna be my next question I think we're gonna have a range of projects and I don't think we want all projects to be large Areas and opportunities in our community that are smaller European and I'm curious to hear anybody else So my opinion I think you want to think about The value Right So Given the other criteria this in our ordinance about it has to be 10% at AMI and 10% Of the 120 Units would be a minimum number of units that could allow you to build It does say my based on some of the comments we received back that most projects that qualify for light it Would not meet that criteria. So we might need to look at that criteria I think those are some of the projects that were interested in Making sure that those projects get completed Right But why tech doesn't fall into the criteria because it says no Well, it's So it's different but you're asking about you want it in City wants developers to come in and develop property So there could be if we're talking eight million dollars I mean often a lot of units But there may be a Or less or a developer wants to do it and it works because Market rate or market rate for so many units 120 below 80 they have to do the math Negotiate the purchasing of the property and development, but also Not all the properties in certain areas and where they're all together You know, I think it's more than just looking at the pilot program It's how can certain zoning be work with if they agree to do this 15-year Project And they do it Eight million dollars And for me that's a very interesting point because if you travel around other cities because they're unique lots and other places You can do smaller units and what it what it's really done It has helped with the workforce You know, it's because that's you know, we talk a lot I mean a lot of what we're seeing from Columbia Housing Authority those applicants Those are families who need affordability, but we have a whole workforce and as you know What's happened in Charleston the workforce has been driven out of downtown Where here we have unique where there could be smaller units development So I think we got to figure out a Kind of a threshold that allows us to have flexibility to encourage Some unique situations that may be you know, what if it is a six-unit two of them or workforce housing, you know We're hitting things. So I do think we need to have that flexibility That way Projects that we can Have more detail in ours, but maybe we have it where there is flexibility So they have, you know a senior housing complex that might be you know, five new questions You know that could be considered Having that ability to encourage the developers to do their due diligence do the do the finance I Want to add In the past What was unique about waterscrest is that Which was in SP, which would allow you to go up So we were able to look at the entire project number of units How many could be set aside up to 20 how many could be set aside for the eight so ideally, you know, we've got lie tech in the conversation because You know, they they provide a huge resource in terms of providing funding to develop affordable housing although they do have some limitations What I think I'm hearing from council Based on some conversations as well as what we've presented in the past is that you know Figuring out how we can work this to where it can include mixed income Everybody I kind of make sure we continue to think in that way. We don't need to have a process to make sure the standards are clear, make sure the base lines are clear, to make sure we can set up a product that allows people to find some profitability and provide support for housing. And then we don't need a process. And that's just one problem. The second, the reason we're looking at that is 10% Zoom we're talking about. Yes, it makes a lot of sense. Just on the long term, it also makes sense that the neighbors typically have many issues, but it makes you think about rates. And I think 8% market rate, 10% EMI, 10% it's going to take a long time to figure it out. Well, we've got the experts out here, but I just don't think we're, I don't think we're big enough. I mean, I'm aggressive and sentenced to play one citizen. So, I mean, let's put something in place that's clear. It's complementary. Delight tax, complementary to 4% program, complementary to, there may not sound there, but for something that's clear, people step up and meet the standards, they get the benefit. I don't think we are the over-regulated process that's meant to be something that needs to be done for a company cash flow and to help us meet the overall public policy vote. I'm glad that we have started taking too much about complementary uses to all the other tools out there to talk about a different product that shouldn't work well with other things, but who's stalking you all through? And I do think that the initial conversation was that we wanted something that didn't prohibit people from using the other tools that would be an additional tool. As we got into that conversation, we were pulling of what does this allow? What does this allow? So, we do need to get back to that discussion that we need something that would be an additional tool, even if they're bringing my tech and other things to the table, they can use this as well. It doesn't say that if they're using this, it shouldn't prohibit someone who doesn't have any of the other sources. That's amazing. And all of the folks in the audience here have proposed projects in the past that say housing that would process successfully. The thought was that we have something that might be able to marry up a 4% program or something else that would still allow those projects to pass. So, I think a couple of brains are here in this room before. I didn't know that incentive looked like 10,000 per door. Whatever it looked like, whatever it added up to, or what our contribution might look like if it were home funds, if it were land, whatever it was if it were tax avoidance, there's something that looked like that that would make projects that had some scale that had 50 to 60 units maybe larger looking at existing commercial corridors from places where we might have a light, we have bus service, we have grocery stores, and some that would stack up in the QAP process pretty well. And thinking like that, and thinking like it again, in all four districts across town, we're not the one part of town we're talking about across town, thinking along those lines. And my daughter's very well, she's got a lot of money, and a lot of money, and two nights, and two nights, and just everywhere, all four districts across town. But thinking to scale, and thinking about really putting that down. You're not. I'm Kevin Conlon, I'm the Conlon Builder Development. One thing I want to clarify if I'm not sure that everybody's clear on, several years ago, through the important times of correlation, we got, as we considered, the fare tax. It sets the tax based on the property that was very fair with the assessor for adding the value of the tax credits, tax to bricks and sticks, cost of building the property, and the good that the size of the tax credit property, the line-take property's already got a little bit of a, it's a lot fair. So I think what you're dealing with here and up in the sound, you're all in the city for your efforts in doing what you're doing. But I think that you're right, there is a, between the 60% of A&I and the 80% of A&I, there's a window there that's long been forgotten. Those are the folks that are still working forward, and they have a hard time making them think that this program could do a grid stack. Yeah. Smaller projects are always, people at a higher cost premium, they cost the same thing and they have to have the same division and the same finance and cost and everything to get a smaller project that's a little larger. So if that's where you want to go, that's fine. Just know that that's going to cost more resources to build a smaller project. And also look at, because it allows us to, instead we have a cliff at 60% of the state. If they make 61% of A&I, they're going to be very, very qualified to kind of bridge the incomes across your development so as long as you don't exceed 60%. And that's going to be a beneficial tool for working with SC Housing right now. They'll develop it for all states that have new development so working with them, trying to go a little slower than other states to try and adapt. One thing I think you need to take a look at is how you can use your pilot program on the convention and the decision to profit. So something like that works really well and you get what you're looking for. That couple within and potentially we'll also talk about housing about putting the national housing trust fund money into the tax credit program. That's a new revenue stream. It's already 30% of A&I so housing trust funds with tax credits and then you work with your pilot program. Now you're talking about having an impact. When we first started talking about this also was that because the LIHTAC program is waiting to see if their application is approved and they don't and then the project we definitely want something that will help them do a project looking at what we're looking at looking at it and that. Well I think that's the housing they're working on very hard. They've got $750 bond trying to get those dollars to have that available resources and not be able to utilize it to that program. So they're trying very hard to come up with ways and I think it's a 4% tax credit with the tax credit to get the bond to this one. The tax credit to all of that. But the problem's always been since you're getting half the equity there's less equity there so that means we're funding it. So filling that funding we can figure out how to fill that funding gap squeeze that down. Having a tax credit? Are there other states around our area that would help? Absolutely. It's always been difficult. North Carolina have a state tax credit and the problem was they don't have income in that state so North Carolina they just said we're having those credit for selling for 40 cents on the dollar 50 cents on the dollar so the general assembly said why do we want to take a dollar worth of attention except 50 cents a value on the dollar before they started just monetizing that instead but I think they had to go through the understanding process and say hey let's just put some money in the program I think now the economy is back to the rise in areas like Boston where it's really becoming a crisis and starting to realize that before the conversation it was a lot harder to find people like you can feel it over there so now it's becoming a lot more and it's really under facing the same issues across the city and it's starting to become a reality okay we'll do great things but that answers your question yeah I mean that's just an opportunity for us in the city to work with the state to help technical question point what happens if you quantify a unit for say the 80% AMI and the people that occupy that unit are successful and their income grows and they grow out they grow out of that qualification how does that work with the rules restricting the total for the development there is some leeway in working with those folks and the rent would go up different story patients may have income if they don't before then that's a different situation again for at risk that's why the management is widely for the development if somebody hopefully also wants to is it raising the minimum or is it raising the suggestion it could be a balance of both I know I think home to housing is done a great job on the last two projects they had a lot of money on the city of Saxon and Rosewood but both of those projects they went in with mixed income and they even did from the city of Saxon they had other housing units tax credit units and then they had 80% units but they were segregated they had inside city of Saxon you know where they are and then went to Rosewood although they didn't use any tax credits they did about 30% market rate 30% to 80% 40% of the housing and I think it's been a very successful community there's ways around it there's a lot of guys in here more talented on this process the housing authority we've got this 23,000 is there a way to work with private developers so they understand maybe what a voucher system is there's so much governmental red tape stuff that we don't understand that scares us away but it also adds to the cost and to monitor this stuff is an additional cost to get built in additional overhead but project based vouchers versus vouchers that go with this kind and understanding what that means maybe beneficial to the private developers and say okay we could 30% that we'll accept vouchers on of what that means that's just education and right now with the economy booming we're like you know because we're scared of it we know what we're doing this gentleman at the end had been waiting to get up and I and you can speak to this again I know it's definitely y'all too we really need to solve the problem not criticizing anybody's decisions for anything but I do know that both of you have had projects that you wanted vouchers and you weren't able to get them so I would like to know to come to this point is that really an option and if it's not an option what's the alternative I want to talk about a couple things I'm a property manager not primarily a developer but I'm going to speak more to the day after and also as it relates to you speak as a forest I think personally one of the flaws in tax credit program is what you qualify you always qualify so that then allows people to stay in units whose income would allow them to move out of the places so I'm excited about the initiative but as you develop the one that they would like to consider is kind of take you know realize that you're no longer eligible for the program because one of the just depending on the funding source some say you have to go to market rent but market rent is not the cost of what but that's one thing that I wanted to bring to the attention that you are crafting your restrictions kind of look at that because as the mayor said earlier we're not going to be able to serve the population of people that we serve without that cap because even with the section if you exceed the rent all you have to do is take the market rent and rent it does give you that cushion that protection but what about those $23,000 the one other thing is if you're done with it but look at that cap if it's a lot of qualified people who are receiving assistance because the only thing that the property is being billed in South Carolina where the person who's in is making $24,000 but the combined income that went 20 and they're paying the same rent and there is no tool or mechanism to do that because the tax rate program said once you're qualified you're never qualified and if you exceed a hundred and twenty percent the only other necessary you is to make sure the next person you're in is still occupied by someone who's making it significantly more than what the AMI is so you would move them out once they pop out you're not allowed to move them out they wouldn't continue what you're saying is we should find some way to move them out I say you know entertain directives or within what you're drafting to say hey we're going to exceed this amount but not allow them to stand for food because that's the way we overestimate them now if they exceed income let's just say when they exceed that no consequence to the property and to the developer is to make sure that next person is qualified but that way the person can stay in that building a high-relanding one the fact though the income average whether or not they were speaking about would that go towards that to say you wouldn't, if you kept them there and their income had become higher would you just bring in would you be conscious of the newer residents would you see that average where it should be well the average is what I understand more on the developer side of things and our talk to the complaints over at state housing all the time now they're allowing that that average for the developer to make it work because they understand it's going to be difficult but in the day after we are not averaging yet it's just simply EMI whatever that amount comes to really you need it if you're feeding over of course you know stringent when you look at it some of the residents who've come to see that 80% by significant amount that they've been building could make it up to 100,000 but their rent is the very same as someone who's made it because they were in the program never moved on so they didn't move to a market rate unit well some feels have market rate units and some are just totally distributed that's the problem that's inhibiting people who need so we don't have a graduate program because I know at one time the housing authority was talking about trying to create a graduate program which moved people into different structured housing as their income building their ability to pay bills and everything because we don't want to be prohibiting I think it also depends on the kind of program the housing authority does it takes more than they end up what Dwayne is talking about is that's not housing authority this is private so we're kind of the other mistakes made program this is 30% of the inconsistency that directly the subsidy directly ties to your income that isn't graduated and once you receive that certain amount of income you no longer receive subsidy so the likes of the programs you know project based there's no subsidy for say other than financing fees there's no tool or mechanism of housing discipline or lack of a better but there's no tool to push you out in your venture and I know we know you guys but for Erica and if you can everybody say people's names so Dwayne will grant you got that one good morning I'm Reggie Barnard I've heard many has but today I'll be the one that last week I took over to the CEO I say all of that to say to Dwayne's point to your point I want to go back to what the mayor said this from what I read the program's not designed 4% versus 9% 9% is competitive so there are a lot of deals people apply to the state to try to get 9% deal so you get kicked out 100% you're not going to get the deal because you're competing against everybody from all over the state for a limited amount of dollars that are available so I want to go back to the gap is greater it's always still people's simple man if you got 9% and you multiply that if you say 10 million dollars deal you're going to get 900,000 credits over a 10 year period of time you got 9% you got 4 million dollars now at a dollar to dollar credit so now you got a 6 million dollar gap so that's where the issue that nobody can access why because if we don't have home funds state houses remove home funds from the availability of 4% deals a couple years ago what may be our E2 work is we got 1.2 million in home funds for 4% deals so it fills the gap and we can do the deal you remove that out of there and we can do the deal work so then deal 4 fast forward so now we got income averaging which is the range point from a property management standpoint if I got a in order to do deals in South Carolina that's a game let me be very candid and be very clear it's a game if you want the credits you got to play the game game says you got to be at 60% or 50% or below in order to get the credits and if you want it I'm going to check every box I can in order to get it whether that's really practical or what's needed in Columbia or not in order to get it you got to check the box and play the game but it doesn't solve it for a housing property I mean need so what we're trying to get to is you all are trying to create an incentive that allows a developer whether it's 9% 4% you're trying to create a tax incentive program because what happens is if my tax rate on my property tax is lower through our college program then what does that mean that means I can borrow more money not to borrow more money from the bank to feel that gas that's really going back to what the mayor said that's really what your college program is inducing my tax liability on my property tax it allows me to borrow more money it's a backdoor finance it's a right and so it helps us make affordable housing feel work I always have told people this for 30 years affordable housing is not what we feel affordable housing is what we find heaven's price of the contract is his price what he feels a market rate deal we feel the cost of construction is the cost of construction no matter where we are when we talk about building affordable housing that there's some magical low-cost amount that the contractor charges us to build affordable housing and that is a 5,000 $100 a foot or $50 a foot whatever the contractor charges for bricks and cheap rock and everything at the same price whatever what makes it affordable is all the money for the pilot for reduced reduction of property tax that we allow to give a good and ideal to make it work I think you got to add into that energy efficiency and everything else because one of our biggest problems is the affordable housing we have people can't afford the damn light bill that goes with it because there's no insulation there's no nothing as we've talked about all those things that we do to make that house more efficient is more effective just as much as a rent reduction which Kevin and Dwayne was talking about staying housing with the new rules really what it's intended to do is to be able to say guys let's quit focusing on 60% of the median income up below because all we really housing going back to the Brooklyn Men in 1969 all we really housing it before so now what everybody wants to do is say let's get working folks who as I tell people when I go to McDonald's on my lunch break and I order a hamburger I want to get my hamburger I wanted to write and I want to get that to work I just want to get my burger and get that to work so what ends up happening she's working 40 hours a week and she can't afford a thousand dollar new apartment that's being charged and there's not enough assistance on vouchers and other stuff to make her a house that she can live in and then there's that people that are over 60% so they're over 60% but still below 100% and nobody's building anything for them why because again you have to deal that to make that unit affordable so your tax program is the key point that tax program for the college regardless of where your funding comes from helps a developer to meet that need to help deal that gap regardless of where we get our soft money or we find a deal it enables each person for a private developer to utilize the program that incentivizes to make the economics of the deal again heaven's price is heaven's price to build it but it helps to make the economics of the deal work and that's really what you're trying to accomplish with this pilot I'm like him I don't want this to get caught up in every little because otherwise we'll be here all day we'll never get up in anything fast your pilot is to help us as one incentive in the multiple things that we look at to help affordable housing and again when I say affordable housing I want to be clear I'm not talking bigger percent of income up below because somebody makes a million dollars a year a 500,000 dollar house is affordable to them but somebody makes 200,000 it may not be so it's all relative when we come to economics so what I'm just trying to say and kind of closing up with that is that income averaging allows due to the development process to be able to take people who traditionally is still not on fire holistically at a 9% because it's still going to be the benchmark and state housing has to figure it out in the regulation and that's what kids are seeing that they're working with them on to figure that out but what it will enable us to do for the first time is now I can take a person at 60% and I can take a person at 80% who traditionally in an 9% deal we might even be able to talk to so really what we're focused on is if the housing authority can't help us with a voucher it doesn't matter if we can't get a 9% deal the whole truth of the matter is we're still housing the force of the board because the program by nature is designed as required as the target people at 50% are below which if you don't get a 9% deal so income averaging now allows it to take 60% 50% it allows it to take somebody at 80% and move them into the development the averaging is 80 and the 60 to come back 80 and the 50 to come back to the middle and that's the averaging that's the new game in town let me just be clear that's the new game in town but what it does do is it allows me to borrow more money for the economics of the deal go back to what I said affordable housing is what we finance not what we deal so it allows me the finance to deal in a better way by doing the things of the problem that's the new game in town now we got to add that and then we got to sit down with the syndicated state you're going to buy these credits how much of this when you save them because they're not buying the credit so let's be clear they're only going to buy credits up to that 80% anything that we finance that's a 10 million dollar deal and we're at 6 million and we got so much market rate units over that 80% so once again what the economics of the deal has to work and that's where your politics helps them deal with that a little bit I hope I didn't confuse you but just very specifically though if the economics of the deal works if it's not 10% if we move that to 20 or 30% minimum I think you need to move it to so I'm going to go back to that to me I think you need to move it because all I'm trying to do and what I read in the resolution is incentivize to create more affordable housing then you're just scratching the surface and then you're playing a game with the 10% and that's really not what we mean in this community I think you need to increase that that that requirement you're targeting a development because otherwise I'm going to go do a market rate deal with the 10% but if you go back 30 years with the development apartment complex around it already requires a certain percentage of affordable they don't ever tell you that so the people that really get it is the property manager friends that say you're going to move in here and I've got 2% of my units that I can make at a lower amount that's already been in the regulation so we're really not helping the problem and if the new dam in town is in some averages shouldn't we definitely increase it that's the whole intent that would be correct and also be able to take this program that Kevin mentioned that with affordable housing coalition and with state housing have some discussion the reason why we keep and I want to be clear with y'all very quickly the reason why we keep coming back to the low income housing not that that's the answer to everything but since 1986 it hasn't continues to be the number one mechanism that's going to create affordable housing without that you won't be able to create it so why we keep alluding to that that's why we keep talking about the live-in program because it has what number if we're not going with the 10% to send a proposal what number would you pick as a percentage if we were 30 and what does the correlation want the reason so let's go back if we say 25% if I'm doing a live tech deal which is the number one I've got to be at 75 or 80% so even for me as a developer I'm going to put a deal together that I'm waiting to put in right now and in order to do a 4% deal I've got syndicators waiting to buy the credits for me right now I'm going to put a last year and a half but I can't deal with that but I'm going to be a board I'm already modeled but the state housing still hasn't chosen a policy related to you so if I submit it today then I may get kicked out from them or I'm going to have to do the same thing I'm doing today with them and go to the board to say here's how I'm going to work I've already worked with the syndicator I've already worked with the lender and this is talking about DRE a project where I'm going to finish I'll see you there they haven't been waiting two years to deal with me but I'm just sharing with you we're already, so let's just be clear as developers, we're already going to be way above that 75% using live tech if I'm a private developer and I'm trying to benefit from this program then if you only do 10% then they're getting away with murder I'm just being honest they're getting away with murder that has benefited from this program so heaven's right incentivize it to require the developer who's not using live tech but wants to do affordable housing require him to have a huge amount of his percentage we've got 10% at 80% and 10% at 120% are you adding those two tens together to be 20 so within 5% of what you were suggesting so I agree with what you were saying earlier I think you're affordable on the lower end higher the difficulty is on the agreement with you that there should be a higher amount on trying to share with you is that from an economics of the deal standpoint the developer on a live tech deal as to sit down with the syndicator who's going to give him some who's going to bulk add that anything over that 80% because they're not buying credits for that so that's risk management on their side so when they underwrite that deal when they underwrite that deal and that's what I put in my theme to you all when they underwrite that deal their discount is focused on a 9% on a 4% deal straight affordable they're going to give me 90 cents from the dollar once I add that percentage of over 80% up to 120% they're going to come back from a risk management because of a marketability they're going to discount my credit amount so now I'm back in the home again because now I got a gap again so we got all it's a lie I hate it but I mean I hope I'm helping with this to have a better understanding of all of the different nuances but this counts that unless I got a great relationship and I got the balance sheet and I can prove to him with your support and everybody 120% great work in my deal and the market supports that it's not it ain't going to happen in a 9% deal it's just not in a 4% deal in Kansas, trying to do this in a 9% deal it's just not going to happen and so it's no benefit so when I had previous discussion with Janique in years ago with Steve we were talking about when we look at this as Kevin said we have $750 million in the state and buying cap available really where that benefit comes in in a 4% deal infrastructure funds from the city infrastructure support all of those things need so the bottom line is you're suggesting that we increase the percentages as Tamika was suggesting to 25% or something like that and then work on the tax credit which is the only benefit that we're putting in the deal and back out of the market's going to drive it in the market's going to drive it the economics of the deal is going to drive everything else and that's what Steve was saying don't get caught up in the semantics of the deal as much as you focus on it so the only other piece that I do want to add to one other thing when we talked about smaller development one value added benefit that's different in South Carolina that's not applicable in other states South Carolina does which is a benefit South Carolina does allow data site development for 4% deals to be in a fine trend back so it doesn't even have to be like with us we're talking about from the senior development as long as I don't exceed $24 million then I'm trying to do a deal in Rock Hill with Bury Bury here in Columbia because as long as I don't exceed $24 million in bond cap for transaction I get it so the same thing is applicable in inner city or inner county that you can take different lives and do the smaller deal as long as it's in the 4% of dollars so you can still make it work and again that's the developer's choice I'm just sharing with you that it's up to the developer to make it work and I'm just sharing here to take it back so I'm not hired Is there any benefit and we had this discussion a couple of weeks ago we're talking about maybe having a sliding scale of tax credits based on what you're doing is there any benefit for us looking at giving a higher tax credit for another type of deal or more affordable No I think by you doing what you talked about I'm just going to drive it I just need to add in an additional one from that 10% if I can add a minimum so that way it still does have a requirement for the 4% And currently we do allow for an additional 10% if there's an excuse incorporated Yeah that's in the 2000 square feet of more And that's also a point of is that valuable or not valuable some of the challenges they mentioned of your high of the So I think a lot and almost let that be your starting point So if 100% market and a more you come down from 100% the tougher it is going to be tax incentive makes up some of that gap and it may be some more dollars and it's hard to figure out exactly what the right percentage is If you go to one extreme the more and it's not very different the more you impose and the higher you make them also you're not getting this So it's really trying to find that right and there's no magic answer but I will tell you in most cities and we do work with most cities at 20-25% as far as what people now San Francisco very different economics so it's not a one side but there are best practices around similar AMI so that would be one recommendation I would say What is that sweet spot but 20-25% really and I think you have to think about it so we like to think about it like it's an airplane selling tickets it doesn't matter if that person bought the ticket in advance got the internet specialist $200 an hour before what they get on a plane and nobody knows what you want so the other aspect of this is that that's the real a lot of people don't like to talk about that but that is the reality so you don't want it to be thought about as though we deal with this all the time you don't want it to be so again if you go to that's where the income averaging makes more sense that's where income averaging doesn't make more sense and I know we've been talking about it in the framework of a little amount of tax credit but absolutely absolutely the only perspective is I think when you get outside of 20-25% range you start pushing an envelope that's one that's going to stress your local resources because the higher you go the pile it helps but it probably doesn't fill the gap plus something else so the more that you oppose upon it the more capital dollars the other incentives that are going to be so that's just a different perspective sort of how to look at this but I think the focus if you can incentivize market rate development particularly the ones that are socially conscious and they want to have it but that's really what you want in some cities of dawn as far as having food in Arizona you say they all have to certainly not suggest it that way but the more you think about it the more you require in order to make the economics work one thing everybody said the economics have got to work because from a developer standpoint we can talk about this theoretically all day but if it's not a financially viable transaction the deal just isn't there a lot of challenges with the 4% working on a deal in Greenville now we've got seven sources of fund that were closed so I don't think you want to cater just to the 4% because this is just a lot of challenges everybody's very familiar with the challenges of the 9% I'll highly competitive that is so I think that big piece of this how do I get socially involved Goldilocks on Goldilocks on Does anybody else have any comments they'd like to share with us I'm part of the building industry association I'm learning a lot by listening I'm talking but I think industry we shouldn't look at one policy solve our four wows related problems different ways to maybe approach this but this is one piece of that puzzle where you're headed now the zoning I think is a real issue that was hit on but we need to find some innovative ways that we can find sites that allow for the tight housing that we all need as long as it's not historical we'll be alright I was going to try to stay away from the demolition but that's going to be an issue somewhere down the road that we can't demolish the property that might allow for this and I think as long as we keep the program is volunteering and that there's enough incentive that the developer won't volunteer then it will work we don't see where it works anyway so it's got to remain volunteering since it's got to be enough such that the developers and if y'all want to sit down with the developer builders after this we'll be glad to be with you I wanted to know from the developer's perspective if it's as good as it is not I have not let me say it seems like they're all over the map and that's because these things are like they talk a lot about like they like to pretty much put them anyway distance to services driving that model and it's maybe it's a good thing but what that does is it drives your land cost up because now I'm not buying a piece of farmland I'm buying a piece of property that's a viable development for a commercial center or something like that so every one of these things is a little bit different the percentage and what we need to make it work, everyone's different depends on the land cost and the construction cost I know you guys are aware of going through the ceiling but the economy on fire and the cost of materials going up and the labor is becoming more and more scarce that's a real problem so it's even harder now I apologize for what you're doing don't get discouraged but what I would say is start at a number we can run some models I'm sure the developers can run some models and say hey this works this doesn't really work and just ask for that information to the developers let's see what we can work but it's going to be kind of a finding that hack in the media and it may start out at 25 but I'd like to make you sustainability, viability of the deal and the property manager keep in mind that these are models and projections and so forth and from the time of application CEOs but if you don't consider the economics that's very important but you also want to be a sustainability because in the event that we're not meeting the promises that the developer made the assistant car recapture they're going to take them in fact as a property manager I can't make it work and one of the things is this is being able to run up you know if your deal only has 20, 25% and the rest is 80% will that market support it then when the application is put in or will it support it today one of the things I think I've read up about this 20% thing is New York City which is right from Development Hat and some of the more upscale of how you're in the community they require 20% in every apartment every deal they do have to be 20% affordable but just keep in mind you come in there today below that and you've exceeded you've got to stay there forever but then yet again you have another unit that would be more available to a family who needs it but I know we're looking at the numbers and trying to make it work but also keep in mind sustainability and viability of the project which the developer is on the hook for until that time is up because if you do something that's not right they can capture the credits and you know they typically get upset when I say this needs a portion but we have to look at the day after and then we want to get the deals done but if they're not going to sustain itself they'll not be able to you know live up to what the deal still is going to work but it's not going to work on the party and it's going to take a long time when would you have that in there that they have to sort of buy every year in the credits so what happens if they what happens if their income that threshold will they remain will they be allowed to remain or would the property would lose our tax credit we'll have to swap them out yeah for our standpoint if it's a developer but they made a good point they got some notes that we want but if we do add the number two the income averaging then that will give them that yep does everybody has everybody got a chance? no unfortunately probably not this is the first opportunity I've had to participate in a wonderful gathering my name is Jeff Laramore I'm currently acting as the interim executive director for the Midlands Housing Trust Fund I've been a board member along with Jamie Donna for going on seven years now and I stand here in front of a bit conflicted I've been a I've participated in development teams I've participated in job contracting teams I've been a sponsor I've been an underwriter and now acting as an ED for a community development finance institute a lender my ask is input in conversation from all parties is we talk about the administration of the program if you look at your resolution you're targeting a thousand units over five years that's 200 units if you take a lot of percentages you can balance a really small number I've been in property management as well so for that aspect full circle there's challenges between the differences of small developments and larger development and everyone has a space study to evaluate it my ask of this board today and everybody in the room is to create a message to build on the greater aggressive the aspect of what this board and body can do will help our role as a CDFI as a developer to get the private sector more and incentivize and engage as well the difficulties that we have in some respects is when you're comparing city public funds and state funds which I'm not greatly familiar with at this time but if you've got the standard market the banks and people in those areas that would attribute to the movement of affordable housing and creating better shelter options it comes out of being able to tell the story of what this group is doing to benefit all the parties within the cycle of activity to get a new development underway or refurbishment of an old development which is sometimes as challenging than the first generation the messaging needs to be optimistic and revitalization to be able to show that there is an effort made by the decision makers in our community who want to make progress and as we all have an opinion of what direction we need to go our goal is let's do something that way if we have the opportunity to continue to engage with conversation we still are able to show that the efforts of being made are making things up so that all parties have their ability to use what they know best or in answering this question to make a progress for the community and it has become something that the state and we can be proud of in more ways than one so I appreciate your time thank you again Roscoe you gotta come to the front sorry we don't make sure everybody recognizes we've been discussing affordable housing and development one of the things I want to add to this is that we didn't talk about I heard the gentleman talk about social resources what we found is that in years before you have owners and developers that come into the community and buy tax credits you really don't put a lot back on into it you don't turn it back into a date they hold those put a minimal amount of improvement to the facility on the plan certain communities we found that you really need that you need aside from the matriculation of how you're going to fund it how you're going to creatively stack funding, whatever you want to do but supportive services is very important because of the fact that you have to educate your tenants you have to educate folks in the company looking for housing a lot of times you find where management is very important because you might keep like you said people in instances making 80, 90,000 miles a year paying what they would pay if they don't make it 18 that's the responsibility of management the other thing is creating situations where I don't want to provide my tenants with the opportunity to make more money or to be educated so they can move into I have people come to us in other aspects where I'm working to consult to a group to make a certain salary because it attracts from them being able to stay with them that's ridiculous but what happens is there's no education there's no transfer of understanding law enforcement it's right in the middle of eight minutes from downtown no wifi you have just the one kids but they can't do their homework because they don't have wifi mothers don't have a place that they can look for work look for services for their children but then again they're not going to do anything they're not going to be able to get an income so they stay where they are I've seen kids that live that have been in projects for 27 years they're 27 years old they've been living their whole life to me it's ridiculous to find a way to support services for education whatever it might be to help them move to the one percent over some places you have land use restriction agreement it keeps the AMI at a certain level it won't change you need to look into that also there's some areas of Columbia to have that it's a lure land use restrictive agreement restrictive cover and it keeps it locks the AMI 6% whatever it be and you cannot change it whatever goes in it you cannot change that so those are some of the things I wanted to look at I wanted you to look at everything else I've heard I'm very very optimistic you know I was kind of looking at a little higher 10 is there on the 20, 10, 20 I was getting up a little high but I liked the blend I liked the blend after 6% you got a blend between 80 and 100 you got a blend there so I like that we had talked about that about you know Faroe because you're not going to put a $400,000 on Faroe but it's a process and then the other thing is attracting those people to market aesthetics has a lot to do there you go you call they have to look a certain way they can't look the way I think I said before when you all go on trips all of you have been on trips and you've gone to another city and you drive and try to find a restaurant and I know all of you have said you know you've said it you know why because it's designed that way it looks that way we got to change that can't look that way I want to change from a hood to a neighbor but I just wanted to say that before you stop because I think you all have also been very forward thinking about as you mentioned there are loads of other projects and some of our targeted areas as far as the commercial scene can you give your perspective a little bit on because I know with development you know you've got to have you've got to have the people in place to fully see a lot of this but the abilities that you have also that you've got to have a mixture I mean we had talked about Farrill roads I mean having a commercial you've got to look at the area you've got to do an assessment of what's out there there are a lot of folks out there me and out there Shade Street, McHenry why can't you have a part store in that piece right there Laundromat, other areas you know right there on Farrill roads you've got 40 miles to the Pickle Wiggler you've got another then to the Old Pickle Wiggler Laundromat is gone so then it didn't school well so you have to put things in certain communities I can tell you my aunt died a couple of years ago my family's from Texas who went to Houston to a funeral now when I was younger living in Texas once you got out 40 miles outside of Houston all you saw were cow chips and cows that's all you saw 15-20 miles I mean we talked about theater hospital banks and I said this is Texas it's just the annex and they go and they go and they go all I'm saying is that if you look at certain areas of Columbia there are no businesses on the Farrill road I will make this comment because we need to be this is a real honest thing one of the frustrating points about the Farrill road is that we have tried to engage to get things there we get pushed back from the neighborhood you know and it's a challenge that we face that we've got to figure out how to overcome because I mean from your point of the Piggler Wiggler we had a Piggler Wiggler looking at that Farrill road site in the neighborhoods that we don't want to we're trying to help encourage a growth there to provide the services that your neighborhood needs so it's a fine balance but I agree but the education piece you mentioned earlier is another thing that we need to tackle because I remember when I was in the restaurant business I would have people that would refuse raises they wouldn't take benefits and everything because they were worried about losing their place and housing and everything we've got to help people be able to get to it there is somewhere else to go and how to get there and fix that gap that we've got but there is a gap 100% agree this needs to be a two step this is one piece but the educational piece we need to help encourage and grow and I don't know all the answers to it but we've got to figure it out I'd like to say again in those areas North Maine particularly those areas that we are believe North Maine but when a business comes into Columbia you know years ago if you remember they had this book it was a 9-1-1 call book and it made a check mark every time a 9-1 call was made and I mean the book was that thick I think it was a partnership with Benedict University of Toronto so they make a check mark in there every place there was a 9-1-1 call regardless of what it was so a business person could come in town and get that book and flip it over and look at it and say well I know when I'm not going to put it on because of the 9-1-1 call I don't want to just put it on 9-1-1 call that's a part of it but those areas had a wide range of 9-1-1 calls I can't say whether they were justified or what but that's not the issue it's what it looks like I think education is very, very important and supportive services are very important and I take it about myself part of what the develop has to make sure that it's there that's the reason we pushed to buy the old Chevrolet station is to make that investment to show people that look we're willing to be here you should be along with us and try to grow that south beltline corridor and we need to continue that but we need to take it around the corner to two nights in other areas and we need to do that whatever you would question we've gone out of the housing you should be able to scale them and swap it out so they move out of that into a different rent basis and then they add another unit we will make sure that I think if you just basically indicate that we have if it's a large type of company and our work I mean I'll be happy to provide some language I'm just sharing with you that if we're in compliance with section 42 then from a revenue code and that should be a indicator that it's still in compliance Any of you that think I'm sorry Go ahead and jump on in everybody else has we're scheduled here till 11 but it's fine so a couple of notes I had to see our minimum raised 25% we've kind of been talking on the side things 25% to the 80% was it also y'all's suggestion that we change the 10% for the 120 and the data as well 2.25 well that would make the whole development 50% he was saying 30% was I'm asking for some but under the I'm saying probably closing the 80% to 25 what I'm asking is the 10% that we currently have for 120 should that stay at 10% or should that be increased as well if you increase that 120 then you're increasing for those people who have the income you're going to have a place 25% 25% the more at the lower levels would be more impactful in the region so we leave it at 10% yeah 20 in 10 would that help let's be clear 20 in 10 would stay within that 30% 20 in 10 then I'm also suggesting maybe add some language in number 2 that allows for the income average so you have that last line that talks about affordability calculations that'll include you have that stuff so maybe add additional lines to talk about affordability based on income averaging whatever the language is yeah other suggestions that I would like to know but I've written down under B when we talk about the actual credit is it possible to add you've got the 50% or mixed income an additional 10% whatever 50% and I don't know if it should be an increase from that or some kind of acknowledgement if the development is in one of the targeted areas it's intended to be a tax we might need to make that clear and then I saw in the county and I don't know if that would be different than targeted area but in the county's ordinance they have kind of encouragement to review flights about expedited plan review time is money in the end of the day all of it is we do I don't know how expedited it is but it's worth you know got two so you can fill a gap it's intended to be if we need to reword this to make that clear help us please that's a different approach to the income I was looking at it much larger than I expected I'm not trying to speak for you but I'm just trying to share with you if you can as to incentivize development across the board then you got to start at the baseline for a market rate deal is the baseline for a li-tech deal by state law is you got to modify the language a little bit that makes it applicable to you before to still give the value to incentivize your baseline the baseline value is the same it's just you got to be able to apply it to both scenarios that's not the way it reads otherwise if I'm at if I take a 10 million dollar 20 million dollar development and use an agency's cap rate from real estate you might be able to push push them to it we want it to be applicable to all because it might be a private developer who has their own time without particularly private financial financing we want it to be attractive if you're participating in a li-tech to do it and I think what you're saying is if someone is participating in a li-tech they're already getting a tax credit based on the state law and if we don't base it on that so that's not an incentive for them right because he used to keep a market rate deal this is market risk so if it's a market rate deal and I use it that way all I'm doing as a private developer is increasing my curfew there's no reason for me to say this because it fell on gas but I need to realize this there's nine percent deals again and those deals are more okay, it's like risk that this corporation has made four percent bond deals they're both done based on the tax risk based on that additional benefit that's a huge benefit if you help push those deals to fruition and it also helped incentivize market rate developers to do that and that's what I was saying before I was thinking in fact if these deals can have a separate and separate ownership they can ban it because the pilot program doesn't make sense and the nine percent deal is nine percent blended is it going to be blended? well it will be delivered they can do that let's let's let's very complicated so why don't we why doesn't the coalition provide some suggested language that we can review and then staff why don't y'all go ahead and craft off after today's conversation some language let's compare the two, figure out how to do it so that we can address both I think the intent and try to get forward because it is a complicated process and what we're trying to do is fill the gap for encouragement I just wanted to lay that word I thought you know because if you put the language out there like Reggie was suggesting start launching across the table on the income approach but I'm not going to give the amount of cash for the deal I'd be the first one to benefit from that well maybe we need two ways to take advantage of our credit one if you get the state appraisal and one if you're using the local appraisal if the state is going to set an appraisal basing using the income method and the county is going to be setting an appraisal based on value of this property maybe we have whichever one you use that's how you're the project you just mentioned can you run the numbers you say we don't want to do that you think we'd be offering more of a benefit than we're intending to but they don't need it but I think larger lower income which we do want to address the need but we incentivize more than nine percent that we may see ourselves if we can put them further than we want to and not disrupting the folks who really need and have that need that are not getting any power I think that's why we started with the 10 percent at the lower income if we want it blended and not all lower but obviously that number needs to increase I'd love to see the number so from a time frame when can the coalition get something back to our staff and if staff will work on it then we can we'll meet again on the 18 yeah Alicia I'd love to run your numbers that's why I just have a question though because we ought to that's why if you are I don't know what he's going to take along because there's a law but all you have to do is like every time he's over and there's a need to get on the session they don't allow you to say hey we'll look at everything based on what you're building from that story and that's how we do how to finance the state and in the first year it's difficult to follow up with him so you guys go the first time county tax is up and you get it and so it's what's in do they assess it based on that and that's not anything of the matter so we'll have demolition this should not be the conversation at that point we'll just make sure that everyone we're trying to get who are always here there's lots of folks that get a copy of those or just ahead of time Erica do you feel like you captured all of the development community y'all could just double check it Erica that would help us out a lot as you have your contact very good discussion