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Austin Housing Finance Corporation approves formation of 501(c)(3) nonprofit to pursue tax-credit funding
Summary
The Austin Housing Finance Corporation board approved a consent item authorizing staff to form an AHFC-affiliated 501(c)(3) umbrella nonprofit and related single-asset subsidiaries to pursue a tax-credit set-aside and provide organizational flexibility; one public speaker opposed the move, citing concerns about transparency.
The Austin Housing Finance Corporation board of directors voted without objection Thursday to authorize staff to form an AHFC-affiliated 501(c)(3) nonprofit corporation and related subsidiary 501(c)(3) entities, the board said at a brief meeting in City Council chambers at Austin City Hall.
The item, offered on the consent agenda, directs staff to create the nonprofit’s bylaws, appoint its board of directors and form affiliate single-asset 501(c)(3) organizations under the umbrella entity. Shay Ackley, deputy general counsel, told the board the primary purpose is to pursue a set-aside allocation for federal tax credits. "The main benefit is we're gonna go after the set aside allocation for tax credits. We need a 501(c)(3) in order to do that, so it's gonna give us another lever to pull in order to get funds for housing. That's the main benefit," Ackley said.
Mandy DeMaio, treasurer of the Austin Housing Finance Corporation and a housing department official, said the structure "does not impact our ability to raise funds or deploy funds," and staff described the umbrella as providing flexibility to create single-asset entities to protect AHFC and its assets. As counsel explained, the umbrella could allow the corporation to form sub-501(c)(3) entities that would serve as general partners or property-owning entities.
One member of the public, Zenobia Joseph, spoke in opposition during the public comment period. Joseph said the nonprofit would have "no members" and described the proposal as lacking transparency. She also urged that Mandy DeMaio resign. "This nonprofit will have no members," Joseph said, and added she opposed the item for reasons she described to the council.
The consent agenda motion was made by the vice president of the AHFC board (mover not named in the record) and seconded by board member Harper Madison. The board approved the consent agenda "without objection," and the meeting was adjourned at 11:47 a.m.
Staff were authorized to proceed with legal and administrative steps to form the nonprofit, including drafting bylaws and appointing a board, but the transcript does not record a timeline for IRS filings, board appointments or when the entities would be eligible to apply for tax-credit set-aside funds.
