Agenda 12/10/2024 Item #16K10 (Resolution - Approval to authorize a proposed revenue bond issued by the Housing Finance Authority of Collier County ("the Authority") to be used for either single family or multifamily affordable housing programs)12/10/2024
Item # 16.K.10
ID# 2024-2155
Executive Summary
Request by the Housing Finance Authority of Collier County for approval of a resolution approving a plan of financing
involving the issuance by the Authority of single-family mortgage revenue bonds in an amount not to exceed $50 million
or, in the alternative, to use volume cap allocation for mortgage credit certificate programs or for multifamily housing for
persons of low or moderate income.
OBJECTIVE: To accomplish the necessary approval to authorize a proposed revenue bond issue by the Housing
Finance Authority of Collier County (the “Authority”) to be used for either single family or multifamily affordable
housing programs.
CONSIDERATIONS: This request is a duplicate of requests submitted by the Authority in 2022 and 2023, and
approved by the BCC by Resolution Nos. 2022-106 and 2023-98 respectively.
Federal law limits the amount of tax-exempt private activity bonds that can be issued in each state each year (referred to
as the "volume cap"). For a housing authority such as the Housing Finance Authority of Collier County to issue tax-
exempt bonds for affordable housing, it must receive an allocation of the state volume cap from the Florida Division of
Bond Finance. In the past several years, changing economic conditions have created a situation where the state-wide
allocation requests far exceed volume cap available, and receiving an allocation has become almost a lottery. For
example, in 2021 the Authority approved a two-phase acquisition and rehabilitation of an existing 392-unit apartment
complex called Brittany Bay. The BCC approved these two bond issues on September 14, 2021. The Authority applied
for allocation for both issues, but only received allocation for Brittany Bay Phase II. (Fortunately, the developer was
able to obtain an allocation for Brittany Bay Phase I from the Florida Housing Finance Corporation, so the entire project
was done.)
To partially offset these risks, some authorities have gone to a system of approving a single-family mortgage revenue
bond issue under a plan of finance which also allows the authority to use volume cap allocation for either single family
or multifamily financing, rather than requesting allocation for a specific project, as has been the traditional method.
Under this strategy, the Authority can apply for a volume cap allocation of $50 million, which can be used either for
single family mortgage revenue bonds or a sharing of allocation with another authority that would issue such bonds for
several counties (more likely). Other options would be the sharing of allocation in a multicounty mortgage credit
certificate program, or to use the allocation for a multifamily project. The $50 million authorization is necessary to
allow the Authority to carry forward any unused volume cap allocation received for up to three years. Restrictions on
the use of an allocation in the year granted (e.g. 90% must be used on a single project in the year the allocation is
granted) make use of the allocation in the year granted generally infeasible, but at the end of the year a three year carry
forward can be obtained, which is not subject to the 90% rule (i.e. can be used for multiple smaller projects). The
Authority's bond counsel has reviewed and advised this proposal.
To implement this strategy, the Authority held a publicly advertised hearing on March 25, 2024, at which members of
the public could comment on the proposal. No members of the public attended the hearing either in person or remotely,
and there were no public comments either before or at the hearing. At the conclusion of the hearing the Authority
adopted Resolution 2024-03 (the "Authority Resolution") approving the plan of finance and directing appropriate
officers of the Authority to seek approval of the issuance of bonds pursuant to such plan from the Board of County
Commissioners, as is required by the Internal Revenue Code. A copy of the Authority Resolution is attached as Exhibit
A to the County Resolution, 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 of County Commissioners. This approval is signified by the adoption of a
resolution (the "County Resolution") approving the issuance of bonds by the Authority.
By statute, any bonds issued by the Authority can only be revenue bonds, payable only from revenues associated with
the project, and are not obligations of the County, the state, or any other political subdivision. There is no pledge of any
taxes, nor a pledge of any other revenues except the revenues of the project for which the bonds are issued. Neither the
County, the Board, the Authority, nor any officer of the County is liable for their payment. Further, the County
Resolution provides that this approval by the Board does not abrogate any County regulations, including land use
Page 9897 of 10663
12/10/2024
Item # 16.K.10
ID# 2024-2155
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 Authority Resolution such as the resolution attached to the County Resolution, 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 the Authority Resolution.
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 local financing authority and Host Approval is given after the Board receives the report and
recommendations of the financing authority in the form of the Authority Resolution. Here, the public hearing was held
as described above, and no members of the pubic expressed any views in opposition to the project or the bonds.
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. Bonds of this type are treated as Component Unit Debt on the County's annual audit. Board
approval is necessary for the Authority to apply for volume cap allocation.
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. The Authority is a self-funding agency, and no County monies are contributed to its operation.
GROWTH MANAGEMENT IMPACT: The adoption of the attached resolution will have no adverse growth
management consequences. The Authority requires that any specific project be consistent with the LDC as a
prerequisite to consideration of an application for financing.
LEGAL CONSIDERATIONS: This item has been reviewed by the County Attorney’s Office. Review of these and
similar bonds by the Governing Body is a statutory requirement and serves as a safeguard against the issuance of
inappropriate bonds, which is not the case here. The County has no liability, contingent or otherwise, with respect to
these bonds. With that noted, this item is approved as to form and legality and requires majority vote for Board
approval. -CMG
RECOMMENDATIONS: That the Board of County Commissioners adopt the attached Resolution.
PREPARED BY: Donald A. Pickworth, Counsel
Page 9898 of 10663
12/10/2024
Item # 16.K.10
ID# 2024-2155
Collier County Housing Finance Authority
ATTACHMENTS:
1. Resolution approving Housing Finance Authority bonds - CMG signed
Page 9899 of 10663
Page 9900 of 10663
Page 9901 of 10663
Page 9902 of 10663
Page 9903 of 10663
Page 9904 of 10663
Page 9905 of 10663
Page 9906 of 10663
Page 9907 of 10663
Page 9908 of 10663
Page 9909 of 10663