TOWN OF MARION
AFFORDABLE HOUSING TRUST
March 23, 2010
MEMBERS PRESENT: Ora Mae Torres, Chair
ALSO PRESENT: J. Witten, Town Counsel
P. Dawson, Town Administrator
Ms. Torres called the meeting to order at 7:00 p.m.
Approval of Minutes
Mr. Grady made a motion and seconded by Mr. Cushing to approve the meeting minutes of March 4, 2010 as written. VOTE: 6-0-0
Ms. Torres advised the trustees that there is an ethics law that should be completed online by each member and a copy be filed with the Town Clerk’s Office.
Little Neck Village
Ms. Torres thanked Mr. Witten and Mr. Dawson for being at the meeting. Mr. Witten noted that there are still many documents going back and forth. Citibank has required that the loan close by March 31, 2010. There are a number of provisions that are unacceptable from Citibank that need to be resolved before a closing can take place. Mr. Witten noted there are many documents to review such as the subordination agreement and the Regulatory Agreement which is most important. Mr. Witten started with the amendment to the lease. The trustees agreed on the lease document and signed it and Attorney Witten is comfortable with the lease that we have. Citibank has required changes to the lease. Attorney Witten is comfortable with their changes as amended, providing the trustees are.
This lease cannot be transferred. Citibank will have a secure interest in the buildings, rent and the physical structures on the property. Attorney Witten’s advice to the trustees is the first amendment to the lease as redlined is ready to be ratified if the trustees agree. The commencement date is a problem and Mr. Witten does not know what that date will be. Not all of the terms have been complied with. Mr. Witten is not concerned that all of the issues prior to commencement have not been satisfied. It will be satisfied before the closing.
The next document is the Ground Lease Estoppel Certificate and its purpose is to have Citibank have a document they can rely on that would be used against the town. The first amendment to the lease needs to be signed, the ground estoppel certificate is what Citibank uses as an estoppel condition. The third document is the lease or the side agreement and there are 3 pieces to it. The first is the Comprehensive Permit, second is the Regulatory Agreement and the third which is the lease. The trust feels that the Little Neck Village agreement or side agreement should be a part of the actual lease and not be a separate document. Mr. Witten will take care of this. Mr. Witten asked for a status report from Dellbrook. The last thing included in the estopple certificate was an
acknowledgement that we understand in their 5 year operating activity budget. The last and most important document is the regulatory agreement that will run with the land forever. It runs with the land forever because of reference to Chapter 184 Section 31. That is the perpetual deed restriction that goes with the property regardless of what happens and is recorded with the Registry of Deeds.
Mr. Witten asked the trustees what the comfort level would be to authorize the chairman or any member to sign any and all documents necessary to close the loan. This would allow Mr. Witten, Paul Dawson and the chairman or member of the board to sign the necessary paperwork to close the loan. Mr. Dawson noted that he received a call from Mr. Angelo today asking Mr. Dawson to relay to the trustees the critical importance of closing on or before March 31, 2010. Mr. Angelo said the reason this is critical is that if it is not done by March 31, 2010 then the tax credit investor walks away.
Mr. Blanchette is comfortable having a single person be a signatory providing every one of the 8 provisions have been taken care of. Mr. Cushing is also comfortable under the same provisions. Mr. Grady feels is Mr. Witten can put a package together that amends this draft sufficiently that he can recommend we execute it he thinks it’s a formality. Mr. Henry is comfortable with a single person and he would be comfortable with Mr. Grady being that person. Ms. Burrill noted that she would be more comfortable having another meeting and gaining an understanding because we are a public board of trustees. Ms. Burrill agrees with Mr. Henry’s suggestion. Ms. Torres noted that the trustees have all agreed that is has to be what they have said it’s going to be all along. Mr.
Witten will not let the trustees sign anything that town meeting has authorized the trust to do.
Mr. Witten noted that he has not seen the draft release of the existing regulatory agreement for the 12 units through the Registry of Deeds from Mr. Schaefer. The new regulatory agreement will succeed the old one.
Mr. Witten noted the documents that will be recorded and the trustees will be signing are the following:
The Affordable Housing Restriction
Landlord Estopple Agreement
Notice of Lease
Side Agreement which Mr. Witten will have turned into an addendum
Right of first refusal purchase option
Because of the recording of the documents through the Plymouth County Registry of Deeds Mr. Witten suggested that it would be a proper place for the closing.
The next meeting for the MAHT is Monday, March 29, 2010 at 7:00 p.m. in the Conference Room.
Ms. Torres asked Town Counsel, Attorney Jon Witten about the statute which prohibits the town or municipality from purchasing property for more than the appraised value using the CPA funds. The Town of Marion based on the appraised value through the CPC Funds would pay the appraised value. The non-profit would pay the difference to the property owner. As long as The Town of Marion deed requests the purchase price of the appraised value this can be done. Ms. Torres has had a conversation with Habitat and they are looking at the possibility of applying for grants to do just this kind of thing, money to help purchase properties. Atty. Witten noted one more piece to this is when you use CPC funds it requires permanent restrictions on the property. Whoever the additional payer may be needs to
understand this as well.
Attorney Witten explained as trustees you are authorized by the act to expend monies subject to voter approval. CPA has a 10% allocation for community housing. This allows the trust to get to the money twice. If the trust chooses to expend monies without CPA Funding then an article would have to go into the warrant to see if the town will authorize the expenditure for whatever purpose. The 2nd option which is more traditional is the trust would have to ask permission through the CPC. In order to use CPC Funds the CPC has to recommend to the selectmen for the warrant an article to extend CPC funds for Affordable Housing.
The trust can request through CPC as an article that the automatic 10% allocation be transferred to the Affordable Housing Trust Fund.
In summary, Mr. Dawson noted that the trust needs to finds a mechanism by which the 10% allocation is put in the Housing Trust Fund for housing purposes. The CPC’s understanding is when a request for the CPC funds is received by them that it needs to be for a specific project. The CPC see’s itself as the overseer of these funds. This 10% is entitled to Affordable Housing and not entitled to the Affordable Housing Trust.
Attorney Witten also noted that the trust can petition town meeting for an allocation of funds for a project that the trustees would like to pursue whether it be construction or land purchase. This would be an article to town meeting that the trust can petition through the selectmen.
Mr. Grady made a motion to rescind the previous action concerning CPC Funds for an article being filed to have annual town meeting for that purpose and to assume that the CPC will take all appropriate actions concerning community housing funding.
Seconded by Mr. Cushing. VOTE: 6-0-0
Mr. Grady made a suggestion to invite Ms. Schaefer to the ground breaking. Ms. Torres noted that all previous members will be invited as well.
A motion was made by Ms. Torres to adjourn, seconded by Mr. Cushing. VOTE: 6-0-0
Grace Hatch, Assistant MAHT