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2 <br /> o An AHP $550,000 Second Loan originated by Bank of America with a 7% interest rate <br /> and matures in December 2030. <br /> o An NC Housing Finance Agency (NCHFA) $4,995,112 loan, provided in lieu of tax <br /> credits with no interest and no payments required. The note matures in December <br /> 2025. If the property remains in compliance until that time, the note will be forgiven. <br /> o An NCHFA $332,997 Loan that matures in February 2040. The note bears no interest. <br /> o A United Housing Associates $250,000 Loan that is now assigned to Bank of America. <br /> This loan matures in December 2030 and the note bears no interest. <br /> ■ Community Home Trust (CHT) hired Partnership Property Management (PPM) as the property <br /> management company in January 2018. <br /> ■ When CHT acquired the property in 2017, the Operating Reserve was $81,938 and the <br /> Replacement Reserve was $85,352. <br /> ■ The expenses incurred that were paid from the reserves since CHT's ownership include the <br /> following: <br /> o $22,896.90 of operating reserves for property insurance in October 2018 <br /> o $9,743.66 of operating reserves to pay for a variety of normal maintenance activities, <br /> i.e. pressure washing and apartment turnover costs. <br /> o $17,794.69 of replacement reserves for miscellaneous replacements, i.e. appliances <br /> and sprinkler heads. <br /> o All transfers from both reserves were approved by the NC Housing Finance Agency <br /> (NCHFA). <br /> ■ CHT cites three (3) factors that caused the challenges being confronted. Those factors are: <br /> o The property lost money in 2015, 2016, 2017 and 2018. <br /> o Six (6) apartments were vacant when they acquired the property and vacancies <br /> remained high for most of 2018. However, by December 2018, there were only three <br /> (3) vacancies. <br /> o Some apartments, especially two (2), were very expensive to turnover and rent. <br /> ■ Based on an application from CHT, the Orange County Housing and Community Development <br /> Department provided $3,500 in Risk Mitigation funds in late January/early February 2019 for <br /> one of the aforementioned units. <br /> ■ The Town of Carrboro recently provided $30,000 of a $50,000 request. CHT will submit <br /> another request this spring for the remaining $20,000 needed. <br /> ■ The property management company, PPM, has worked hard to address the causes of the <br /> losses, i.e. reducing the vacancies and holding tenants accountable to their leases. The <br /> financial performance of the property was turning around at the end of 2018. As of today, <br /> there are only two (2) vacancies and the rental income is more stable. <br /> FINANCIAL IMPACT: A financial impact is anticipated. The requested monetary assistance, if <br /> approved, would be taken from the County's Risk Mitigation and Housing Displacement Fund. <br /> SOCIAL JUSTICE IMPACT: The following Orange County Social Justice Goals are applicable <br /> to this item: <br /> • GOAL: FOSTER A COMMUNITY CULTURE THAT REJECTS OPPRESSION AND <br /> INEQUITY <br /> The fair treatment and meaningful involvement of all people regardless of race or color; <br /> religious or philosophical beliefs; sex, gender or sexual orientation; national origin or <br /> ethnic background; age; military service; disability; and familial, residential or economic <br /> status. <br />