[Year-Round Housing] New mailing list; Aug. 10 Grant followup info
Mlongreene2 at aol.com
Mlongreene2 at aol.com
Mon Aug 16 13:46:09 EDT 2010
Good Day All;
1. I have added the one YRHASC member to this mailing list who was not
on it (plus several others who have requested to be on it). This will
eliminate the need for duplicate Housing Committee and YRHASC mailings to many
of you. I will not longer send stuff to YRHASC (until and when that
committee needs to something specific).
2. Anyone receiving this "Housing Committee" mail who does not wish to
receive it any longer, please let me know. (at _mlongreene2 at aol.com_
(mailto:mlongreene2 at aol.com) )
3. As we continue to crank up on the grant work, much of the working
details and other prep stuff may not be of interest to some of the 30 folks
on our Housing Committee Listserve. We may re-use the yrhcworking for
day to day paperwork if needed.
4. Attached please find the budget workup that Mary Terry did for us
following last Tuesdays meeting. As suspected, some of the numbers that were
on the budget worksheet we started with were for two houses not one which
had a drastic effect on the projected monthly costs/rents. There are 4
tabs for budget(high); budget (low), 15 year potential operating costs to
study.
5. We had many questions about some of the costs that were estimated.
Mary submitted them to Liza Fleming Ives at Genesis and the thread of those
questions and responses are just below and opened from the several
e-mails: (Read all the way thru as some questions are answered in each e-mail)
Mary and Mark,
Good to see you both yesterday. Below are some responses to your questions:
2. Why are the legal fees high? Liza said her experience with MSHA
closings indicate the 11,500 is a fair number. There tends to be much
legal work involved that might not be required for a conventional closing.
Closing on a grant/loan with MaineHousing will involve legal work. The
$11,500 would be typical of a small project in which MaineHousing is
making a loan. Since we haven't yet closed a performance grant, I don't
know how different this will be. I know MaineHousing is committed to
keeping these kinds of costs down, especially for the island program. I
just haven't seen what that will look like yet and it's always awful to
get to closing and have the legal expenses be higher than you anticipated.
3. Is the Survey/Soils line necessary since the property has been
formally surveyed and soils tested?
Yes. It is important to keep this in the development budget because it
is a relevant expense. At the same time, since it has already been paid
for and you are not seeking reimbursement for it, then you should use
the actual cost and then add the same amount under sources as a
contribution by the YRHCorp.
4. What does the Insurance item ($2,000) under Profession Services cover?
MaineHousing will require that you pay a full year of insurance upfront
and provide evidence at closing on the grant. Since this is an expense
incurred before or at closing, it is typically listed in the development
budget.
5. Why is there a Reserves Section in the Development Budget and then
again in the Operating Pro-forma?
MaineHousing will require that the reserves be funded upfront at the
time of closing on the grant and then will require that contributions be
made to the reserves every year (or more frequently as appropriate). The
replacement reserve is typically funded at 1% of the cost of structures
upfront and then a set annual contribution (like $300 per unit). The
operating reserve (which will actually be a tax and insurance reserve
for this program) will be funded to cover the next tax and insurance
payments and then regular contributions will be required.
6. If the group uses a design/build team, do they need a line item for
Engineer/Architect?
This should be a major part of our conversation with MaineHousing when
we meet with them. They are being very flexible about not having an
architect, but may want to have you use an engineer. I would include at
least $10,000 for an engineer (for now) in the development budget.
I'll take a look at the pro forma early next week and follow up with
both of you. Please be in touch with any questions about the information
above.
Best regards,
Liza
Mary Terry wrote:
> Good afternoon,
>
> Last evening a the Long YRHCorp met to review the pro-forma you sent
> and brainstorm the costs they envision to build 2 homes.
>
> There were several questions for you, Liza. You addressed some of
> them in our brief conversation of this morning. Here is the list,
> with the answers when applicable:
>
> 1. Are the budget numbers for 1 or 2 homes? Liza said 2 homes.
>
> 2. Why are the legal fees high? Liza said her experience with MSHA
> closings indicate the 11,500 is a fair number. There tends to be much
> legal work involved that might not be required for a conventional
closing.
>
> 3. Is the Survey/Soils line necessary since the property has been
> formally surveyed and soils tested?
>
> 4. What does the Insurance item ($2,000) under Profession Services
cover?
>
> 5. Why is there a Reserves Section in the Development Budget and then
> again in the Operating Pro-forma?
>
> 6. If the group uses a design/build team, do they need a line item
> for Engineer/Architect?
>
> The group looked at a stick built quote and the Peaks modular quote to
> create the numbers. Using their own on-island experience they
> projected the costs for a well, septic, driveway, and land clearing.
> The YRHCorp numbers are in blue on the spread sheet and I made
> comments to help clarify. I did a high cost sheet and a low cost
> sheet - you will see the tabs along the bottom.
>
> I know the final numbers gave the group pause.
>
> In looking at all of this, I wonder if there is other grant money,
> community assets, community donations etc that could be put toward
> this project to bring the build costs down. My immediate thoughts for
> grant money are: Key Bank, Maine Bank and Trust, Maine Community
> Foundation (specifically Cumberland County), Hannaford's, Lowe's,
> HomeDepot.
>
> Just some thoughts.
>
> Mary
>
> --
> Mary K. Terry
> Island Institute
> Casco Bay Affordable Housing Fellow
> marykterry at gmail.com <mailto:marykterry at gmail.com>
> 207-221-2507
--
Liza Fleming-Ives
Associate Director
Genesis Community Loan Fund
3 Chapman Street
P.O. Box 609
Damariscotta, ME 04543-0609
Tel: 207.563.6073
Fax: 207.563.6055
liza at genesisfund.org
www.genesisfund.org
"providing innovative financing and expert assistance to Maine nonprofits
since 1992"
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