The Role of Asset Management in the Firm Commitment Process · • MHDC must be notified when...
Transcript of The Role of Asset Management in the Firm Commitment Process · • MHDC must be notified when...
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The Role of Asset Management inthe Firm Commitment Process
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Asset Management Contacts
• Marian Campbell, Director of Asset Management,[email protected]
• Scott Hanak, Asset Manager (Financial/AMRS)[email protected]
• Candace Maupins, Program ComplianceAdministrator(Physical/Compliance)
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We Have Moved!!
US Bank Plaza –Downtown St. Louis505 N. 7th Street, 20th Floor, Ste. 2000
St. Louis, Missouri 63101Ph. (314) 877-1350
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Information Reviewed
• Management Agent Documentation• Management Plan/Lease Review• Form 2013 Revenue/Expense Analysis
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Required Management AgentDocumentation
• Exhibit A-2: MHDC Management Agent Certification*or HUD 9839-B HUD Management Agent Certificationif HUD is in first place.
• Exhibit J: Authorized Representative Designation*• Exhibit J-1: Management Authorized
Representative Designation*• Exhibit L: Property Information Sheet• AFHMP - Affirmative Fair Housing Marketing Plan*
Note: Original Signatures are required on forms identified with asterisks.
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Required Management AgentDocumentation Cont…
• Management/Maintenance Plan• Proposed Lease• Lease-up Narrative and Budget
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Exhibit A-2: Management AgentCertification - Errors
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Additional ManagementDocument Errors
• Missing original signatures• Missing MHDC #/LIHTC# property
identification number• Missing Notary Signatures• Using outdated MHDC Forms/Exhibits
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Management Agent CertificationProcess
All existing and/or new managementcompanies seeking to manage properties inMissouri must be approved as a “Certified
Property Management Agent.”
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Management Agent CertificationProcess
• Exhibit A-5: Certified Property ManagementApplication plus all required supplementaldocuments.
• One, two, or three year certifications.• Scheduled Submission Quarters - must submit
90 days before certification expires i.e., submitby 3/31/17 for 7/1/17 effective date.
Note: Management Companies – must becertified before taking on new business.
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Certified Management Agent Letter
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MHDC Certified PropertyManagement Listing
http://www.mhdc.com/program_compliance/index.htm
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Management Plan Review
Refer to Exhibit A-1 Management Plan Outline andChecklist to ensure all required items are included in the
property management plan.
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Management Plan Review withProject Based Section 8
• Review 4350.3 Ch 4 for required elements of theTenant Selection Plan.
• A copy of the Tenant Application, Tenant SelectionPlan, required leases and all lease addendum andpet policies should be attached to the planssubmitted to MHDC.
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Leases• Refer to LIHTC manual page 33 section - 5.4
Leases.• Common missed clauses:
– Obligation of the tenant to recertify incomeannually
– Obligation of the tenant to notify managementregarding change in student status
• March 4, 2016, New VAWA Addendum 91067 wasreleased including new appendices.
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Ownership
• Oversee Management.• Required to cover deficits of the property.• Management is required to notify us when
owners are no longer willing to materiallyparticipate – reported to the Commission.
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MHDC Form 2013 Review
• Assist underwriting in determining project’soverall viability over initial 15 year period.
• Determine reasonableness of the proposed firstyear budget.
• Provide suggestions for developer’sconsideration based on current portfolio.
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Expense Line Item Changes
Owners and Developers must include a expensechange explanation memo for all expense lineitems that differ from the initial application.
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Form 2013 - BenchmarkingAnalysis
Proposed Revenue and Expenses are comparedwith the following benchmarking segments:
– Geographic– Expense Account Category– Total Development Units– Management Company– Development Type– Mulitiple phases– Urban/Rural
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Form 2013 - BenchmarkingAnalysis
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MHDC Form 2013 BudgetReview Tips
• Include expenses that are expected to re-occur onan annual basis.
• Budget One FTE Manager and Maintenance personfor properties with 48 + units and are not part of amulti-phase development.
• Avoid the “Miscellaneous” temptation.• Common space utilities still need to be budgeted.
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MHDC Form 2013 BudgetReview Tips
• Highly recommend security to be budgeted for allproperties located in metro areas.
• Neighborhood Scout Crime Index is now 4.97.• Avoid grouping contract related expenses, i.e., snow
removal, HVAC, exterminating, vacant unitpreparation costs, etc. under the general contractscategory.
• Obtain current insurance quotes.• Indicate any tax abatement.
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Cost Per Unit Data
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1st Year ComplianceRequirements
• MHDC must be notified when lease-up commences.• All properties must submit complete and executed first
year 8609s. Complete means signed by the owner withthe Part II section filled out. #
• Property must be inspected for Latent Defects withinnine months from construction completion date. #
# - Failure to do so will result in the property being issuedan 8823 which reports noncompliance to the IRS.
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Annual ComplianceRequirements
• Exhibit A forms must be submitted annually through COL anda hard copy must be submitted to MHDC’s ComplianceReporting Team in accordance with the seasonal reportingschedule.
• If HOME funded, hard copies of Exhibits H and K must alsobe submitted to MHDC’s Compliance Reporting Team inaccordance with the seasonal reporting schedule.
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Common COL Errors
• Late submissions.• Missing transient housing information.• Missing certification dates.• Missing data i.e., “Unit Assistance Type.”
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COL - Unit Assistance Type:
• General Information Tab/Head of Household Basic Data
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Rent Increases• Properties must wait at least one year from the date the
last building was placed in service before a rent increaserequest may be submitted.
• All Rent Increases must be approved by MHDC prior toimplementation.
• Rent increase approval process is specifically tied tofunding and development type.
• Rent increase caps - 7%; previous year COLA for Elderly• Rent increase process can be found at
http://www.mhdc.com/program_compliance/accounting/rent_increases/index.htm.
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Noncompliance Fees
• A non-compliance fee will be assessed for theperiod of time a property, specific building, unit,or management agent is failing to satisfyprogram requirements.
• The amount of the fee varies based on the typeon non-compliance.
• The detailed non-compliance fee notice islocated at www.mhdc.com.
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Noncompliance Fees
• Instances of non-compliance include, butare not limited to:– Physical and/or file deficiencies– Failure to submit required documentation
change in partnership or management agentwithout prior approval from MHDC
– Failure to submit a timely CertifiedManagement Agent application
– Failure to report casualties in a timelymanner
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Special Needs Unit Monitoring
• Two inspections per year• Compliance Items:
– Proper Set-Aside– Services provided
• Noncompliance treatment– Treated the same as Sec 42– Subject to 8823 issuance– Potential suspension and/or debarment
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Service-Enriched Monitoring
• Ensure commitments made for servicesduring application are implemented.
• Noncompliance treatment– Loss of future opportunities to ownership and
its affiliated partners to be considered forfuture tax credits and MHDC financing.
– Non Compliance Fees are assessed.
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Contact Changes
• Owner/Management responsibility to makechanges.
• AMRS must be updated.• New Exhibit L must be submitted if:
– General Partner change– Primary Management Contact change– Management Company Address change– Special Needs Lead Referral Agency change– Service-Enriched Housing Provider change
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New Fair Housing Requirements
• Post Fair Housing posters.• Make Fair Housing brochures available.http://portal.hud.gov/hudportal/HUD?src=/program
_offices/fair_housing_equal_opp/marketing• Will be enforced with inspections
beginning 4/1/17.
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New Transfer of Physical AssetsPolicy
• New TPA Application Form• Timeframes
• Limited Partner transfers = 15 days• General Partner transfers = 30 days• Full Transfers (tax credit or loan) = 45 days
Note: End of year TPAs must be in no later than November 1 orprocessing may not occur by December 31.
• Submit documents on a recordable CD andnumber them according to checklist.
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New Transfer of Physical AssetsPolicy Cont…
• Note that certain documents require originaland/or notarized signature.
• Post-transfer documentation (e.g., recordeddocuments) must be submitted within 45-daysof transfer; notify MHDC if closing does notoccur, or occurs more than 30 days after thedate of MHDC approval letter.
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Forms/Exhibits• All Asset Management Forms can be found at:
http://www.mhdc.com/program_compliance/LIHTC/forms-documents.htm.
• Make the Exhibit A-20 Asset ManagementReporting Checklist your Friend!
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