STRATEGIC PRIORITY: Housing & Homelessness Solutions Government Performance and Financial Management
AGENDA DATE: January 8, 2025
COUNCIL DISTRICT(S): 6, 11
DEPARTMENT: Office of Government Affairs
EXECUTIVE: Elizabeth Saab Kimberly Bizor Tolbert
______________________________________________________________________
SUBJECT
Title
Authorize (1) a public hearing to be held on January 22, 2025, to receive comments concerning the issuance of tax exempt revenue bonds in an amount not to exceed $152,000,000.00 by the Public Finance Authority for the benefit of AIDS Healthcare Foundation to finance the cost of acquisition, construction and equipping of (i) a multifamily apartment building and related amenities facilities to be located at 2330 West Northwest Highway, in Dallas, TX Texas 75220; and (ii) a multifamily apartment building and related amenities to be located at 8051 Lyndon B. Johnson Freeway, Dallas, Texas 75251, as required by the 147(f) of the Internal Revenue Code of 1986, as amended (Code); and (2) at the close of the public hearing consider host approval of a resolution authorizing the issuance of bonds as required by Section 147(f) of the code by the Authority - Financing: No cost consideration to the City
Body
BACKGROUND
The agenda item concerns the approval, under the Tax Equity and Fiscal Responsibility Act of 1982 (the “TEFRA Approval”), of the proposed issuance by the Public Finance Authority (the “Authority”) of tax-exempt and/or taxable revenue bonds for the benefit of AIDS Healthcare Foundation, a California nonprofit public benefit corporation (the “Borrower”) and an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the “Code”).
The Authority is a commission organized under and pursuant to the provisions of Sections 66.0301, 66.0303 and 66.0304 of the Wisconsin Statutes (the “Wisconsin Act”) authorized to issue tax-exempt and taxable bonds and other obligations for the benefit of nonprofit entities, as further described in the Wisconsin Act.
The Borrower has requested that the Authority issue, from time to time, pursuant to a plan of finance, its tax-exempt and/or taxable revenue bonds in an aggregate principal amount not to exceed $152,000,000.00 (the “Bonds”) pursuant to the Wisconsin Act. The Borrower has requested that the Authority loan a portion of the proceeds of the Bonds in an amount not to exceed $15,500,000.00 (the portion of the Bonds related to such proceeds, the “Local Project Bonds”) to the Borrower, for the purpose of (a) financing, refinancing and/or reimbursing the cost of the acquisition, construction, improvement, rehabilitation, equipping and furnishing of (i) a multifamily apartment building with approximately 198 apartment units and related amenities located at 2330 West Northwest Highway, Dallas, TX 75220, in the maximum principal amount of $5,000,000.00, and (ii) a multifamily apartment building with approximately 160 apartment units and related amenities located at 8051 Lyndon B Johnson Freeway, Dallas, TX 75251, in the maximum principal amount of $10,500,000.00 (collectively, the “Local Facilities”), (b) providing one or more debt service reserve funds for the benefit of all or a portion of the Local Project Bonds, if deemed necessary or desirable; (c) paying a portion of the interest to accrue on the Local Project Bonds, if deemed necessary or desirable; (d) paying certain working capital expenditures, if deemed necessary or desirable; and (e) paying certain costs of issuance of the Local Project Bonds (collectively, the “Local Project”).
The Local Facilities will be owned and operated either by the Borrower or by one or more limited liability companies, the sole member of which is the Borrower, in furtherance of the Borrower’s mission to provide cutting edge medicine and advocacy regardless of the ability to pay.
The issuance of the Local Project Bonds must be approved by each governmental unit having jurisdiction over the territorial limits in which the Local Facilities are located pursuant to the public approval requirement of Section 147(f) of Code. The Local Facilities are located within the territorial limits of the City of Dallas (the “City”) and the City Council of the City (the “City Council”) is one of the “applicable elected representatives” that may approve the issuance of the Local Project Bonds under Section 147(f) of the Code. In addition, pursuant to Section 66.0304(11)(a) of the Wisconsin Act, prior to their issuance, bonds issued by the Authority must be approved by the governing body or highest ranking executive or administrator of the political jurisdiction within whose boundaries the Local Facilities are located.
The Borrower has therefore requested that the City approve the financing, refinancing and/or reimbursing of the cost of the Local Facilities and the issuance of the Local Project Bonds in order to satisfy the requirements of the Wisconsin Act and for purposes of complying with Section 147(f) of the Code. The TEFRA Approval requires no financial or final commitment from the City. It is solely a statutory requirement regarding the issuance of tax-exempt and/or taxable bonds. There is no cost consideration to the City for this agenda item. That is, the Bonds are not issued by, or on behalf of, the City. The Bonds shall not, therefore, constitute a City liability, indebtedness, or obligation, nor shall any City revenues or assets be pledged to pay the Bonds. The City’s name will not appear on the Bonds. City staff has not reviewed any documents related to Bond issuance. The Bonds shall specifically provide that the Bonds are not a debt of the City of Dallas, Dallas County or the State of Texas and that the City of Dallas, Dallas County and State of Texas are not liable with respect to the Bonds.
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
This item has no prior action.
FISCAL INFORMATION
No cost consideration to the City.