City of Alexandria, Virginia
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MEMORANDUM
DATE: MAY 16, 2018
TO: THE HONORABLE MAYOR AND MEMBERS OF CITY COUNCIL
FROM: MARK B. JINKS, CITY MANAGER /s/
DOCKET TITLE:
TITLE
Consideration of an Increase in an Approved City Loan to the Alexandria Redevelopment Housing Authority (ARHA) for Ramsey Homes from $2 million to up to $3.6 million.
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ISSUE: Construction Cost increases at Ramsey Homes and the plan to close the resultant budget gap.
RECOMMENDATION: That City Council approve a permanent loan to the Alexandria Redevelopment Housing Authority (ARHA) of up to $3.6 million for Ramsey Homes which is to be funded from a portion of the proceeds of ARHA's $5 million previous repayment of the City's Glebe Park loan.
BACKGROUND: In February 2017, City Council approved a loan of up to $2 million to pay for offsite infrastructure improvements and other amenities required for the proposed redevelopment of the existing 15-unit Ramsey Homes public housing development into a 52-unit mixed income community (Attachment 1). City Council had previously approved a loan of
$1 million at the time of the DSUP for Ramsey Homes was approved in November 2016. In June 2017, the development received Low Income Housing Tax Credits and ARHA has been working toward a financial closing this Spring, along with the preliminary start of construction. In February, ARHA held an Open House pursuant to the Section 106 process, and it has completed asbestos removal on the site. Demolition and archeological work will begin soon.
DISCUSSION: ARHA's request for the new loan amount (Attachment 2) cites several factors that have impacted its $2.2 million increase in construction project costs. ARHA notes that the price of steel and lumber have increased by over 20% during the year since its tax credit award. In addition, changes in tax credit prices paid by investors (resulting from the lowering of the...
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