CHFA board authorizes up to $500 million bond preparation, approves financing for two affordable developments

The Connecticut Housing Finance Authority on July 25, 2024 authorized staff to begin preparations for a Housing Mortgage Finance Program bond sale of up to $500,000,000 and unanimously approved a package of financing and program actions to support affordable housing developments and resident services.

At the meeting CHFA’s Chief Financial Officer, Hazim Taib, sought the Board’s authorization to proceed with the 2024 Series J bond sale to raise lendable proceeds for the authority’s first-time homebuyer program. The resolution gives the chief executive officer–executive director and the chief financial officer authority to prepare Official Statements, negotiate the sales on a negotiated basis, award bonds subject to pricing limits, and enter interest‑rate swap agreements consistent with the Authority’s General Bond Resolution.

The Board also approved financing for two specific developments. For 1600 New Britain Avenue in Farmington, CHFA authorized construction and construction‑to‑permanent lending with combined loans not to exceed approximately $23.4 million, and an additional subordinate loan of up to $1,000,000 at an interest rate not to exceed 1% per annum. The Farmington project is a proposed 90‑unit development; the Board’s resolution conditions the Authority’s commitment on an independent appraisal, final plans and specifications, governmental approvals, hazardous‑waste testing and removal if applicable, and commitments for all sources of funds. Affordability restrictions will run for 40 years: 17 units set aside at or below 30% of area median income (AMI), 36 units at or below 50% of AMI, and 15 units at or below 80% of AMI. The construction loan interest rate limitation was set not to exceed 7.25% per annum.

The Board approved a similar financing package for Cheshire Highland in Cheshire, a proposed 71‑unit development, authorizing construction and construction‑to‑permanent loans with aggregate principal not to exceed approximately $18,000,000 and an additional loan up to $1,000,000 at up to 1% interest. Affordability restrictions for Cheshire Highland run for 40 years: 14 units at or below 30% AMI, 29 at or below 50% AMI, and 13 at or below 80% AMI. The construction loan interest cap was stated at no more than 7.25% per annum and the construction‑to‑permanent loan interest cap at no more than 7.15%.

Both project resolutions specify that CHFA’s commitments are conditioned on acceptance of final construction costs and plans, required governmental approvals and tax abatements, satisfactory environmental testing and remediation if needed, and documented commitments for all sources of funds. Each resolution also includes a default closing deadline of April 30, 2025 unless the Authority grants an extension for good cause upon payment of any required fees.

Attachment A to the Farmington resolution authorized pursuit of Housing Mortgage Finance Program Bonds, 2024 Series K, in an aggregate amount not to exceed $26,000,000; Attachment A to the Cheshire resolution authorized up to $20,000,000 for 2024 Series L. U.S. Bank Trust Company, National Association was authorized to serve as Paying Agent and, if needed, Tender Agent.

The Board voted to allocate $1,000,000 of recycled Community Investment Account funds to establish a Housing Authority Resident Program (HARP) and authorized the CEO–Executive Director to implement the program consistent with state law and prior Board direction. The Board also authorized staff to publish proposed amendments to CHFA’s Multifamily Program Procedures for public comment under the Quasi‑Public Agencies Act.

All roll‑call votes on the resolutions were unanimous. The meeting also approved the consent agenda covering financial and program reports and adjourned at 11:01 a.m.

What’s next: the Series J authorization permits staff to proceed with sale preparations and pricing; individually approved project loans remain conditioned on the items listed in the resolutions, and staff will publish the Multifamily Procedure amendments for public comment as directed.