Agenda 09/14/2021 Item #16K 6 (Resolution phase I & Resolution phase II for revenue bonds for aquisition and rehabilitation of Brittany Bay Apartments)09/14/2021
EXECUTIVE SUMMARY
Request by the Housing Finance Authority of Collier County for approval of resolutions
authorizing the Authority to issue revenue bonds for the acquisition and rehabilitation of Brittany
Bay Apartments Phase I and Phase II, an affordable housing rental facility located at 14815
Triangle Bay Drive and 14925 Lighthouse Road, respectively.
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OBJECTIVE: To accomplish the necessary approvals to authorize proposed revenue bond issues by the
Housing Finance Authority of Collier County (the “Authority”) to be used by Brittany Bay Apartments I,
LLC and Brittany Bay Apartments II, LLC, (collectively, the “Applicant”) for the purpose of providing
funds to finance the costs of acquisition and rehabilitation of Brittany Bay Apartments, an affordable
housing facility located off Collier Boulevard, about a mile south of Immokalee Road.
CONSIDERATIONS: The Authority has received and preliminarily approved a request by the
Applicant to issue its multifamily housing revenue bonds for an existing low/moderate income housing
project known as Brittany Bay. The applications are for two separate bond issues, one, in an amount not
to exceed $36,200,000 to finance the acquisition and rehabilitation of Brittany Bay Apartments Phase I,
and the other, in an amount not to exceed $40,800,000 to finance the acquisition and rehabilitation of
Brittany Bay Apartments Phase II.
Background
Brittany Bay is a 392-unit, two story garden apartment complex consisting of two phases that were
originally financed in different manners, resulting in some differences in the regulatory structure
applicable to each project. Brittany Bay Phase I is a 184-unit project that was financed by the issuance of
the Authority’s bonds in 2001. The Board approved the issuance of bonds for Brittany Bay Phase I by
Resolution 2001-44, adopted February 13, 2001 (Attachment 1). It is a 4% LIHTC project where 100%
of the units must be rented to or set aside for persons whose income does not exceed 50% to 60% of area
median income (AMI). While the Authority bonds were redeemed in 2012, the Authority’s Land Use
Restriction Agreement, that establishes the set-asides remains in place, as do tenant income restrictions
contained in the Housing Tax Credit Agreement with Florida Housing. Brittany Bay Phase II is a 208-
unit project that was financed by 9% LIHTC issued by Florida Housing, and 100% of the units must be
rented to or set aside for persons whose income does not exceed 25% to 60% of AMI. Due to volume cap
limitations at the time, there were no Authority bonds issued for Brittany Bay Phase II. Note that the
regulatory structure for each phase, including set-asides and rent restrictions will remain in place
notwithstanding the re-financing.
Brittany Bay is located off Collier Blvd., about one mile south of Immokalee Road. This “north county”
location is significant since most affordable projects have been constructed in Golden Gate or East
Naples. A unique aspect of this project is that it contains a number of four-bedroom units, which are not
common in these projects.
The Project
Brittany Bay is an existing project that was developed almost 20 years ago. The project is subject to
compliance monitoring, and, based on the reports the Authority receives, there are and have been no
compliance issues with regard to set-asides, rent restrictions, maintenance and provision of amenities. In
addition to the acquisition, the applicant proposes to do certain rehabilitation activities, such as ADA
compliant unit conversions in accordance with current requirements, HVAC unit replacements, window
replacements to current hurricane codes, hot water heater replacements, landscaping and parking area
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improvements, community room upgrades, including ADA compliance enhancements, and computer lab
improvements and upgrades.
All existing tenant income restrictions will remain in place, ant there will be no rent increases as a result
of the financing. No tenants will be displaced, and the rehabilitation will be accomplished with little or
no temporary displacement.
The Developer
The development entity will be Spira Equity Partners, an experienced affordable housing developer,
having acquired and preserved over 1,100 LIHTC units over the past three years. Spira is a “Freddie Mac
Select Sponsor” and has closed over $408,000,000 in loans with Freddie Mac over the past three years.
Structure of the Transaction
The structure of this transaction is different from the typical bond issue, where the Authority sells the
bonds to an Underwriter pursuant to a Bond Purchase Agreement, and then loans the proceeds of the sale
to the Borrower under a Loan Agreement. All is done through a Trustee, that receives the sale proceeds,
disburses to the Borrower, receives the principal and interest payments from the Borrower, and disburses
to the Bondholders. In this transaction, the bonds will be purchased by the Federal Home Loan Mortgage
Corporation, ("Freddie Mac") as a private placement. The applicant proposes to use US Bank as the
fiscal agent, which performs the duties done by a trustee in a sale transaction.
Community Benefits
While the provision of affordable housing is, by statutory definition (Ch 159, F.S.) a public benefit, in
considering a project, the Authority looks for community benefits specifically associated with the
particular project. Here, there are several benefits, as follows:
1. The property will be substantially upgraded by the planned improvements, briefly described above. Of
particular importance for these older facilities is the upgrade to current hurricane code requirements for
windows and meeting current ADA requirements, along with a general “refreshment” of the property.
2. In addition to the continuation of the existing tenant income restrictions, a new Land Use Restriction
Agreement will be recorded, further extending the tenant income restrictions. For the tenants, there will
be no impact to their rents. No tenants will be displaced.
3. The Developer will record a social services covenant, committing to the continuation and/or provision
of certain social services and amenities relating to health care (regularly scheduled visits by professionals
such as nurses), regularly scheduled tenant activities planned, arranged, and managed as part of the
management plan, and a computer lab.
THE BOND APPROVAL PROCESS:
Public Hearing Requirement
The Internal Revenue Code requires that the issuing authority hold an advertised public hearing on the
nature and location of the project and the issuance of the bonds. This hearing was advertised in the
Naples Daily News on August 17, and copies of the notice, in the form and time frame required by the
Code, is attached as Exhibit A to each of the Authority Resolutions, as described below. The hearing was
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held by the Authority on August 25. At the hearing, the Authority considered the applications and other
documents presented by the Applicant, heard presentations by its agents and representatives, and opened
the hearing to comments, either oral or written, by members of the public. There were no comments in
opposition to the project or the bonds.
At the conclusion of the hearing, the Authority adopted Resolutions 2021-05 and 2021-06 for Brittany
Bay Phase I and Brittany Bay Phase II respectively, approving the bonds, and directing appropriate
officers of the Authority to seek approval of the issuance of the Bonds by the Board of County
Commissioners, as is required by the Code. Copies of the resolutions adopted by t he Authority (the
"Authority Resolution") are attached as Exhibit A to each of the County Resolutions, as described below.
As stated above, the Code requires that bonds of this type be approved by the local elected representative,
which, in the case of Collier County, is the Board, even if the project is located in a municipality. This
approval is signified by the adoption of a resolution (the "County Resolution") approving the issuance of
the bonds by the Authority (see Attachment 2, as to Brittany Bay Phase I and Attachment 3 as to Brittany
Bay Phase II).
As are all revenue bonds of this type, these bonds are based on revenues of the project and are not
obligations of the County, the state, or any other political subdivision. There is no pledge of an y taxes,
nor a pledge of any revenues except the revenues of the Applicant. Neither the County, the Board, the
Authority, nor any officer of the County is liable for their payment. Further, the Resolution expressly
provides that this approval by the Board does not abrogate any County regulations, including land use
regulations.
The Board’s role in approval of financing authority bond issues
Unlike County bonds, which are issued for public projects, the County-created financing authorities
(Housing Finance, Industrial Development, Health Facilities, and Educational Facilities Authorities) issue
private activity bonds, which are bonds issued on behalf of a private user for a legislatively declared
public purpose such as healthcare facilities, private educational facilities, qualifying manufacturing
facilities, low/moderate income housing facilities, pollution control facilities, etc.
The Internal Revenue Code ("Code") requires two types of approval for the issuance of private activity
bonds: Issuer Approval and Host Approval. Issuer Approval is the approval of the issuer of the bonds
and is initially evidenced by the adoption of an Inducement Resolution (called the "Authority Resolution"
and attached to the County Resolutions as Exhibit A), and ultimately by the execution and delivery of the
bonds themselves. The Board grants Host Approval when it adopts a resolution approving the issuance of
the bonds by the Issuer (called the "County Resolution" in this Executive Summary). Host Approval is
the approval of the governmental unit with geographic jurisdiction over the location of the project.
The primary requirement of Host Approval is that the bonds have been considered at a public hearing at
which members of the public have had an opportunity to express their views on the project and the
issuance of the bonds. The Code contains very specific requirements for the public notice of the hearing,
and a copy of the public notice, which has been reviewed by Authority Bond Counsel and determined to
be Code-compliant is attached to each of the Authority Resolutions.
The Code does not require that the Board itself conduct the public hearing, only that Host Approval may
not be given until the public hearing has been conducted. In practice, both in Collier County and around
the state, the public hearing itself is conducted by the Authority and Host Approval is given after the
Board receives the report and recommendations of the Authority in the form of the Authority Resolution.
The public hearing was held as described above, and no members of the pubic expressed any views in
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opposition to the project or the bonds. A member of the County’s affordable housing committee inquired
as to the computer lab upgrades, and was assured they would be part of the applicant’s requirements.
Effect of Board Approval
Board Approval of an authority bond issue does not cause the bond to become a county bond or an
obligation of the County. By statute, bonds of this type are payable only from revenues related to the
project, and no public monies of any kind are pledged. This is reflected in the Authority Resolution, the
County Resolution, and on the face of the bonds themselves. Bonds of this type are treated as Component
Unit Debt on the County's annual audit.
FISCAL IMPACT: This program does not require any contribution from the Board of County
Commissioners or any other County agency. As stated above, the bonds are not liabilities of the County,
and the County is not liable for payment in any way.
GROWTH MANAGEMENT IMPACT: The adoption of the attached resolutions will have no adverse
growth management consequences. The Project, in existence since 2001, is well served by existing public
infrastructure, and is in accordance with all growth management regulations as applicable.
LEGAL CONSIDERATIONS: This item has been reviewed by the County Attorney, is approved as to
form and legality, and requires majority vote for Board approval. Because counsel to the Authority is
unable to attend the September 14 BCC meeting, if this matter is removed from the 9/14 Consent Agenda,
it is requested that it be continued until the September 28 BCC meeting. -JAK
RECOMMENDATION: That the Board of County Commissioners adopt the attached Resolutions.
Prepared by:
Donald A. Pickworth, Counsel
Collier County Housing Finance Authority
ATTACHMENT(S)
1. [Linked] BCC Resolution 2001-44 (PDF)
2. Resolution - revenue bonds Brittany Bay Phase I (PDF)
3. Resolution - revenue bonds Brittany Bay Phase II (PDF)
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COLLIER COUNTY
Board of County Commissioners
Item Number: 16.K.6
Doc ID: 19881
Item Summary: Request by the Housing Finance Authority of Collier County for approval of
resolutions authorizing the Authority to issue revenue bonds for the acquisition and rehabilitation of
Brittany Bay Apartments Phase I and Phase II, an affordable housing rental facility located at 14815
Triangle Bay Drive and 14925 Lighthouse Road, respectively.
Meeting Date: 09/14/2021
Prepared by:
Title: Legal Assistant – County Attorney's Office
Name: Wanda Rodriguez
08/26/2021 3:40 PM
Submitted by:
Title: County Attorney – County Attorney's Office
Name: Jeffrey A. Klatzkow
08/26/2021 3:40 PM
Approved By:
Review:
Office of Management and Budget Debra Windsor Level 3 OMB Gatekeeper Review Completed 08/26/2021 3:46 PM
County Attorney's Office Jeffrey A. Klatzkow Level 3 County Attorney's Office Review Completed 08/30/2021 11:11 AM
Office of Management and Budget Susan Usher Additional Reviewer Completed 09/03/2021 2:13 PM
County Manager's Office Amy Patterson Level 4 County Manager Review Completed 09/07/2021 2:02 PM
Board of County Commissioners Geoffrey Willig Meeting Pending 09/14/2021 9:00 AM
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