5 - AGMT FOR HSG FIN ANALYSIS AND ADIVSORY SERV

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CSG Advisors Incorporated January 28, 2015 Proposal: Housing Financial Analytical and Advisory Services Page 7 of 25 not for developments with tic) programmatic market equivalent e.g,, special needs, etc.). This analysis establishes a ceiling that represents the maximum arriount required to subsidize affordability - preventing the City from subsidizing basic project feasibility (this counters the occasional efforts of developers to use public, agency funds to subsidize all otherwise infeasible project under the guise of SUbbiclizing affordability). The maxiintim subsidy thus is equivalent to the ceiling, less certain expected sources (e.g., low income housing tax credits). We do this work to help public agencies SLICII as the City determine how nILICh to assist a project. The expertise we bring is demonstrated by the even more extensive modeling we have to do for those public agencies (SLIch as housing authorities) who act as their own developer oil 4% and 9% tax credit projects. We assist in the formulation of (and perform analyses of) the development program including affordability, rent structure, proposed financial structure and relevant restrictions; develop and maintain the development pro fort-nas and casliflow analyses; develop the bond and financial structure; solicit, select and negotiate with lenders/credit enhancers; identify and coordinate application for financing sources (including JoNA7 jilConie housing tax credits, tax-exempt bonds, Multifamily Housing Program funds (ill California), AHP, etc.). We also solicit and negotiate with tax credit investors. Agencies for which we have provided these types of set-vices include the New York City Housing Authority, Flousing Authority of the County of Monterey, the I-IOLISing Authority of the City of Oakland, ttie San Francisco Housing Authority, and the HOLISilIg Authority of the City of New Orleans, among others. This type of work enables to us remain fully abreast of market conditions that have a practical impact on project feasibility as well as providing practical knowledge of developer goals and incentives, Example: Santa Monica Civic Center Housing, CSC; assisted the City of Santa Monica in developing a financing plan for the ("'ivic ("Cilter llousing dc"'Cloplile[It's. Understanding the finandal feasibility of' the proJects litdped Santa Monica structure the best possible deal with the third,party developer(s) thar will exectite the projects and to understand the likely amount of subsidy that will be required, the tradeoffs between affordability ind sulAdy levels, and the types of fillancing the developer is likely to need. I)cvclopers need this type of inl:'Orination before responding to an RFQ/RFP it, order to provide snbstantive proposals. In our work we met Nvith Agency staff" to revie-,A, the goals for the project and constraints. We explored issues stich as affordability t,,irvets, rent levels for market and aff')rdablc units, coinineivial space feasibility, construction cost limits ill the tax credit plwMng and timing issues, compethiveness for 9% credit awards, and differences between financings using 9(% tax credits and those using bonds and 4%) tax credits. This work resulted ill a collipl-01.10lisive financial planning r1lodel 14 the Civic Center housing developi lie n- s t- Using this model, we worked widi Agency staff to evalliarc financing Scenarios alld develop al Ibase case" the finallcillg. We then assisted ill the rfficW of proposals and negotiations with the selected developer. Responses to the Foreclosure Crisis. CSG lielped design the Neighborhood Stabilization Program initiatives for the City of Los Angeles, Los Angeles County, Orange County Housing Authority, the City of Phoenix and numerous other communities. Its the example of llhoenLx, we helped tirilize a significant portion of NSP funnels for the City to hell:) acqUire rind rehabilitate large troubled multi-family projects instired by Fl]A, We thus helped the City negotiate the discounted purchase of a 500-unit property with 50% vacancy, rasing NSP flinds for the rehabilitation work.