1. Western ND School District Funding Information Session July 17, 2013 11 North Dakota Housing Incentive Fund

2. 22 What is HIF? Created by the 2011 Legislative Assembly Purpose is to assist in the development and preservation of affordable multifamily housing units A loan fund made possible by contributions in exchange for credits against state income or financial institution tax liability

3. 33 Affordable Housing Housing that is safe, decent and affordable is important to economic growth Local housing projects stimulate the economy and create jobs More housing choices help workforce families and seniors Stem the loss of these citizens from the community No more than 30% of household’s income

4. 44 HIF’s Impact on Affordable Housing Development The more low-cost funding that goes into a housing project enables it to be affordable for more people Affordability is ensured for the long term –Deed Restriction limits incomes and rents HIF dollars may unlock the door to other private, local, state and federal resources

5. 25 Unit Apartment Building $200,000 x 25 units = $5,000,000 Total Cost Traditional Financing Equity $1.5 million (30%) Debt $3.5 million (70%) $225,465 Debt Service (5%, 30 year) $125,000 Operating Expense $120,000 Return on Equity (8%) $470,465 Needed Annual Revenue = $1,568 Average Monthly Rent per Unit 55

6. 25 Unit Apartment Building $200,000 x 25 units = $5,000,000 Total Cost Traditional Financing Equity $1.5 million (30%) Debt $3.5 million (70%) $225,465 Debt Service (5%, 30 year) $125,000 Operating Expense $120,000 Return on Equity (8%) $470,465 Needed Annual Revenue = $1,568 Average Monthly Rent per Unit Housing Incentive Fund Equity $1.5 million (30%) HIF $1.5 million (30%) Debt $2 million (40%) $128,837 Debt Service (5%, 30 year) $125,000 Operating Expense $120,000 Return on Equity (8%) $373,837 Needed Annual Revenue = $1,246 Average Monthly Rent per Unit 66

7. 25 Unit Apartment Building Mixed Income Property Rent Distribution Scenario 5 units @ $435 (30% AMI) 5 units @ $725 (50% AMI) 5 units @ $1,150 (140% AMI) 10 units @ $1,950 (“Market Rate”) = $1,246 Average Unit Rent 77

8. 88 HIF 2011 - 2013 $15 million Funding Pool 24 Affordable Housing Projects 14 Communities 669 Units $98 million Total Development Costs

9. 99 HIF 2013 - 2015 NDHFA Survey Results –155 Housing Units Owned by School Districts –86 Additional Housing Units Needed HIF Reauthorized by 2013 Legislature –$35.4 million –Focus on Essential Service Workers (ESW) –Additional Uses of HIF Funding

10. 155 Units Owned by School Districts Purchase of existing school district housing units by a private entity –School district is divested –Out of the landlord business –Funds freed up for primary mission –Units remain available only to teachers, etc. –Affordability is guaranteed for the long term 10

11. 155 Units Owned by School Districts Divesting publicly-owned housing NDHFA works with non-profit developers operating in North Dakota Local developers / real estate investors Local Housing Authorities? Request for Proposals (RFP) 11

12. 12 Potential ESW Units HIF Applications Received: Williston (4)Fargo Minot (4)Grenora Watford City (3)Hettinger Bismarck (2)Jamestown Dickinson (2)Lignite BeachMandan Devils LakeMilnor Dunn CenterTurtle Lake

13. 13 For More Information Contact NDHFA: 701/328-8080 or 800/292-8621 www.ndhousingincentivefund.org Jolene Kline, Acting Executive Director jkline@ndhfa.org Bill Hourigan, Housing Outreach Officer whourigan@ndhfa.org