CalHFA's financing team updated the board on the agency's five-year bond-recycling program, reported nearly 7,000 units financed through the mechanism, and described a substantial pipeline of demand (roughly $500 million). Staff also introduced the Coliseum project (5035 Coliseum Street), a large mixed-use development in South Los Angeles proposed by developer Thrive Living.

Erwin Tam, CalHFA's director of financing, said the agency's bond-recycling program allows redeployment of tax-exempt bond capacity across unrelated multifamily projects through a letter-of-credit structure; Apple had been the corporate sponsor for five years. "For the past 5 years, Apple has provided this letter of credit for the agency," Tam said, and then summarized program results: roughly 6,999 units financed under the program and a pipeline with about half a billion dollars of demand. Tam cautioned a recent federal tax-law change that reduces the applicable "25% test" will limit future opportunities; he said the change will affect new bond issuances beginning Jan. 1 and that emergency regulations for round 3 are anticipated on Aug. 5.

Tam explained the program's mechanics and operational constraints: the recycled bond benefit is a lower cost of capital (no additional tax credits), a typical permanent financing share of the capital stack is around 25%, and the agency must coordinate frequent draws and redeployments because preserved bond capacity has a limited useful period (staff described it as roughly a six-month "shelf life"). Tam said the original Apple letter-of-credit has expired and going forward the agency will rely on new letters of credit provided by Royal Bank of Canada and U.S. Bank.

As an example of pipeline demand, CalHFA introduced 5035 Coliseum Street: Zach Bridal of Thrive Living said the project would provide 800 apartments on about 4.96 acres in South L.A., with 184 units reserved for low-income households (not to exceed 80% AMI), and a Costco on the retail portion. Bridal said the project includes extensive subterranean parking (about 1,500 spaces) and that the development team pursued community engagement and focused on services and retail desired by neighbors. He said the project uses ministerial entitlements under Assembly Bill 2011 and pairs project-based RAD vouchers from the Los Angeles Housing Authority for a portion of the affordable units.

Board members asked technical questions about how the tax-exempt benefit and recycled bonds interact with CDLAC/TCAC 50%/25% mechanics, the timing window for using recycled capacity and whether the agency could use government-purpose tax-exempt bonds as another tool. Tam said recycled bonds remain viable for projects already allocated under the older 50% test and that the agency is exploring government-purpose bond options and other conduit arrangements.

Directors flagged the policy urgency: the tax-law change and the limited shelf life for preserved capacity mean staff must coordinate rapidly to deploy recycled benefit for eligible projects in the pipeline. Tam said he expects opportunities to continue in the near term for projects already allocated under the 50% test but that new issuance rules will shrink future opportunities. No action was required; the presentation was informational and staff will continue to work with developers and bond markets to match supply and demand.