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