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Presentation, discussion, and possible action regarding a Material Amendment to the Housing Tax Credit Application for Reserve at Decatur (HTC #23046)
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RECOMMENDED ACTION
recommendation
WHEREAS, Reserve at Decatur (the Development) received an award of 9% Housing Tax Credits (HTCs) in 2023 for the construction of 39 units for the elderly population in Decatur, Wise County;
WHEREAS, Reserve at Decatur LLC (the Applicant) requests approval for a reduction in the Common Area from 10,271 to 9,102 square feet, representing a reduction of 1,169 square feet or 11.38% from the Common Area represented at Application;
WHEREAS, the Applicant also requests approval for a reduction in the Net Rentable Area from 35,868 to 32,850 square feet, representing a reduction of 3,018 square feet or 8.41% from the Net Rentable Area represented at Application;
WHEREAS, Board approval is required for a reduction of 3% or more in the square footage of the units or common areas as directed in Tex. Gov’t Code §2306.6712(d)(4) and 10 TAC §10.405(a)(4)(D), and the Applicant has complied with the amendment requirements therein; and
WHEREAS, the requested changes do not negatively affect the Development, impact the viability of the transaction, impact the scoring of the Application, or affect the amount of funding awarded;
NOW, therefore, it is hereby
RESOLVED, that the requested amendment for Reserve at Decatur is approved as presented at this meeting, and the Executive Director and his designees are each hereby authorized, directed, and empowered to take all necessary action to effectuate the foregoing.
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BACKGROUND
Reserve at Decatur received an award of 9% Housing Tax Credits in 2023 for the new construction of 39 units for the elderly population in Decatur, Wise County. In a letter dated April 23, 2024, Sallie Burchett, the Applicant’s representative, requested approval for a reduction in the Common Area and Net Rentable Area.
The Application originally identified the Common Area as 10,271 square feet. However, according to the amendment request, the Common Area and Net Rentable Area was not able to be met by the General Contractor due to the inability to obtain subcontractor bids to meet the previously established estimate for construction. Reducing the Net Rentable Area square footage of the units while still surpassing the minimums and simplifying the design of the units reduces the costs and keeps the Development within budget. The architectural design change is nominal with very similar architectural characteristics from all elevations. The Common Area square footage decrease is 1,169 square feet (11.38%), and the Development will maintain all required common amenity points. Additionally, the Net Rentable Area has decreased from 35,868 square feet to 32,850 square feet, representing a decrease of 3,018 square feet or 8.41% from the Net Rentable Area represented at Application. The square footage of the one-bedroom units will decrease from 775 square feet to 690 square feet, while the square footage of the two-bedroom units will decrease from 984 square feet to 910 square feet.
The change to the Common Area and Net Rentable Area square footage does not materially alter the Development in a negative manner, and was not reasonably foreseeable or preventable by the Applicant at the time of Application. The Applicant has indicated that there was no net financial impact on the Development as a result of the proposed changes. Staff has determined that this change does not affect the scoring of the Application or the funding award, and the Development will continue to meet the accessibility requirements.
Staff recommends approval of the amendment request as presented herein.