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Sparks City Council Meeting 8/10/2020 2:00:00 PM

Meeting Link: https://zoom.us/j/92908810254?pwd=d3c4VkpaWVlTa3FpaVRGbGJ4RkNTQT09
Meeting Dial-in #: 1-669-900-6833 Meeting ID: 929 0881 0254

Public Hearing and Action Items Unrelated to Planning and Zoning: 10.1

Title: Consideration and possible approval of Resolution # 3366 authorizing the transfer of the City’s 2020 Private Activity Bond Capacity (PABC) allocation of $5,326,819.52 to be divided equally between the Nevada Housing Division (NHD) and Nevada Rural Housing Authority (NRHA) for their respective affordable housing programs.
Petitioner/Presenter: City of Sparks/George T. Graham, Housing Specialist
Recommendation: Staff recommends that the City Council adopt Resolution # 3366 authorizing the transfer of the City’s 2020 tax exempt bond volume capacity to be divided equally (50%-50%) between the Nevada Housing Division (NHD) and the Nevada Rural Housing Authority (NRHA).
Financial Impact: None. The bonds will be issued by the State of Nevada.
Business Impact (Per NRS 237):
    
A Business Impact Statement is not required because this is not a rule.
Agenda Item Brief:

This agenda item proposes the allocation and transfer of the City’s 2020 Private Activity Bond Capacity (PABC), in the amount of $5,326,819.52, to be divided equally (50%-50%) between the Nevada Housing Division (NHD) and the Nevada Rural Housing Authority (NRHA) to support their respective affordable housing programs (see Attachment #1, Certificate of Transfer). Splitting the PABC between NHD and NHRA supports a wider range of housing programs than allocating the entire PABC to a single agency, and therefore potentially benefits a more diverse range of Sparks and other Washoe County residents.



Background:

Under the federal tax reform act enacted in 1986, the State of Nevada receives an annual allocation of tax-exempt private activity bond cap (PABC) authority.  PABC provides states and local governments authority to issue federally tax-exempt bonds on behalf of private infrastructure, utility and affordable housing projects and programs.  For 2020, the City of Sparks’ share of PABC is $5,326,819.52 The City Council may request (by resolution) that the State of Nevada reserve the City’s allocation for a specific project(s) or for a specific program(s).

In recent years, the City Council has allocated their PABC for first time homebuyer programs operated by the Nevada Housing Division (NHD) and the Nevada Rural Housing Authority (NRHA).  This year, the City again received requests from both agencies requesting transfer of the City’s 2020 PABC allocation for their respective housing programs (see Attachments #2 and #3; proposal letters from NHD and NRHA).



Analysis:

The City received requests from NHD and NRHA for use of the City’s 2020 PABC to capitalize their respective affordable housing programs.  Both agencies have consistently provided mortgage products to benefit City of Sparks’ residents such as:

  • Mortgages
  • Down Payment Assistance Programs
  • Grant Programs

These agencies document the benefits of their programs to Sparks residents in their respective letters (see attachments #2 and #3).

These agencies document the benefits of their programs to Sparks residents in the materials they submitted to the City.

After reviewing the requests, staff recommends the City’s 2019 capacity be split equally  between NHD and NRHA to support implementation of their respective housing programs. Splitting the PABC between NHD and NHRA supports a wider range of affordable housing programs than allocating the entire PABC amount to a single agency. Per the information submitted with its request, NHD proposes to use PABC from the City of Sparks to support their homeownership programs for first-time homebuyers, veterans, military families, and teachers, and for the issuance of bonds for affordable multi-family housing.  NRHA proposes to use a PABC allocation from the City to offer down payment assistance and mortgage credit certificates. Dividing the PABC between NHA and NRHA therefore potentially benefits a more diverse range of Sparks (and other Washoe County) residents.



Alternatives:
  1. Council may elect to allocate the City’s PABC equally  between NHD and NRHA, as recommended by City staff.
  2. Council may elect to allocate the City’s entire PABC amount to either NHD or NRHA, or otherwise divide the City’s PABC as the Council may see fit.
  3. Council may elect to take no action at this time in which case the City’s PABC allocation will automatically revert to the State of Nevada after August 31, 2020.


Recommended Motion:

I move to adopt Resolution # 3366 authorizing the transfer of the City’s 2020 tax exempt bond volume capacity to the Nevada Housing Division (NHD) and the Nevada Rural Housing Authority (NRHA) to support implementation of their respective affordable housing programs.



Attached Files:
     01-Certificate of Transfer, 2020 - Attachment # 1.pdf
     02-City of Sparks, PABC Resolution - 2020.pdf
     03-Sparks PABC 2020 - NHD Proposal Attachment #2.pdf
     04-Sparks PABC 2020 - NRHA Proposal, Attachment #3.pdf

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