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Grand Prairie approves payment agreements with Housing Finance Corporation for Prairie Gate phases 1 and 2
Summary
The City approved two payment agreements with the Grand Prairie Housing Finance Corporation tied to the Prairie Gate apartment development: a 35% share of management/tax administration fees for phase 1 and a 35% share of an annual ground lease payment for phase 2.
The Grand Prairie City Council approved two payment agreements Monday with the Grand Prairie Housing Finance Corporation (HFC) connected to the Prairie Gate apartment development.
Under the phase 1 agreement, the HFC — which is the managing member under the developer's arrangement for that property — will remit 35% of the annual management fee and 35% of the annual tax-administration fee to the city. City staff said the management fee for the first year is $10,000 and will increase 3% annually; 35% of the first-year management fee equals $3,500.
Phase 2 is structured as a ground-lease arrangement. Staff said the annual ground-lease payment is $170,000 in the current agreement and increases 3% annually; under the payment agreement the city would receive 35% of that payment.
Julie Dozier, deputy city attorney, explained that the HFC is not required by law to make these payments but "being good neighbors … they have chosen to give us a payment back in lieu of taxes." Dozier and other staff said the HFC in this case is a local entity that purchased the property in order to keep it from being acquired by a travelling HFC that might not remit any payment to the city.
During public comment residents pressed for more detail about whether the properties receive federal subsidized-housing funds. Patsy Ray said she believed the property was subsidized and urged staff to publish confirmation. Staff responded that they had not concluded whether the properties were receiving federal subsidy and agreed to confirm and follow up with residents.
Councilors asked clarifying questions about the size and timing of payments and noted a recent state law (House Bill 21) that gives some HFCs a 10-year compliance window for certain affordable-housing obligations; staff said that timeline remains in effect and that owners can take up to 10 years before required adjustments are made under state law.
Council members moved and seconded approval; both items passed by unanimous voice vote.
