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Presentation, discussion, and possible action on Resolution No. 25-017 amending previously adopted resolution relating to the Issuance of Multifamily Housing Revenue Bonds (The Ridge at Loop 12) Series 2025A-1, Series 2025A-2, and Taxable Bonds Series 2025B
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RECOMMENDED ACTION
recommendation
WHEREAS, the Board previously approved Resolution No. 25-013 (“Original Resolution”) at the Board meeting of January 16, 2025, for the issuance of Multifamily Housing Revenue Bonds (The Ridge at Loop 12) Series 2025A-1, Series 2025A-2, in the total amount of $50,000,000 and taxable bonds Series 2025B, in the amount of $11,914,000;
WHEREAS, in accordance with Texas state law requiring the Board to set the terms for unrated bonds, Section 1.2 of Resolution No. 25-013 identified a formula for determining the respective principal amount of each series of the Bonds by reference to a schedule attached as Exhibit B to the Original Resolution and an aggregate principal amount of all of the Bonds of $61,914,000;
WHEREAS, based on final due diligence and underwriting, a request to amend the Original Resolution to accept a revision to the principal amounts of the Bonds, has been received by the Department;
WHEREAS, Resolution No. 25-013 is hereby amended to modify the amount of bonds to be issued; and
WHEREAS, underwriting and program staff will re-evaluate these changes to ensure an increase in TCAP-RF units is not needed;
NOW, therefore, it is hereby
RESOLVED, that Resolution No. 25-017 amending the previously adopted bond resolution relating to Multifamily Housing Revenue Bonds (The Ridge at Loop 12) Series 2025A-1, Series 2025A-2, and Taxable Bonds Series 2025B, is hereby approved in the form presented to this meeting; and
FURTHER RESOLVED, that if approved, staff is authorized, empowered, and directed, for and on behalf of the Department to execute such documents, instruments and writings and perform such acts and deeds as may be necessary to effectuate the foregoing.
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BACKGROUND
General Information: The Bonds will be issued in accordance with Tex. Gov’t Code §2306.353 et seq., which authorizes the Department to issue revenue bonds for its public purposes, as defined therein. Tex. Gov’t Code §2306.472 provides that the Department’s revenue bonds are solely obligations of the Department, and do not create an obligation, debt or liability of the State of Texas or a pledge or loan of faith, credit or taxing power of the State of Texas.
Where the bonds will be unrated and privately placed, as is the case with The Ridge at Loop 12, the Department cannot rely on authority under Tex. Gov’t Code Chapter 1371, that authorizes the Board to delegate the determination of the final terms to an authorized officer of the Department, but must instead rely on the authority under Tex. Gov’t Code §2306.393 that requires the Board to set the terms.
The issuance of unrated, fixed rate tax-exempt bonds as Series 2025A-1, Series 2025A-2, and Taxable Bonds Series 2025B for The Ridge at Loop 12, in the aggregate principal amount of $61,914,000 was previously approved at the Board meeting of January 16, 2025. The bonds will be initially purchased by NewPoint Real Estate Capital as previously presented. The amount of 4% Housing Tax Credits ($4,343,053) remains unchanged as well as the formula for determining the interest rate and maturity date. However, based on additional due diligence completed by the lender and equity investor there has been a change to the total amount of bonds to be issued. Specifically, Exhibit B to the attached Resolution reflects changes across all Series of the bonds, and reduces the total amount to be issued from $61,914,000 to $59,702,000. While the tax-exempt amount to be issued remains the same at $50,000,000, the Taxable Bonds (Series 2025B) is reduced from $11,914,000 to $9,702,000.