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Home My WebLink AboutCOUNCIL - AGENDA ITEM - 06/02/2020 - RESOLUTION 2020-052 AUTHORIZING THE ASSIGNMENT OFAgenda Item 11 Item # 11 Page 1 AGENDA ITEM SUMMARY June 2, 2020 City Council STAFF Sue Beck-Ferkiss, Social Policy and Housing Program Manager Jackie Kozak-Thiel, Chief Sustainability Officer Ingrid Decker, Legal SUBJECT Resolution 2020-052 Authorizing the Assignment of the City’s Private Activity Bond Allocation for 2020 to Housing Catalyst and Mercy Housing to Finance the New Construction and Rehabilitation of Affordable Housing Units. EXECUTIVE SUMMARY This item meets the following COVID-19 emergency priorities for being on the Council agenda: • Priority 7 - Items that are required to comply with federal or state legal or other requirements. The purpose of this item is to support the new construction and rehabilitation of affordable housing at several locations in the City by assigning the City’s 2020 Allocation of Private Activity Bond (PAB) capacity. PAB capacity is required for development projects using state or federal 4% Low-Income Housing Tax Credit financing. STAFF RECOMMENDATION Staff recommends adoption of the Resolution. BACKGROUND/DISCUSSION The State of Colorado Private Activity Bond (PAB) allocation program is established by the Colorado Private Activity Bond Ceiling Allocation Act, Colorado Revised Statutes Section 24-32-1707, et seq., (the Allocation Act). PABs are tax-exempt bonds that can be issued by eligible authorities. The proceeds of the sale of the bonds may be used for specific purposes as determined by the Internal Revenue Service. Permitted purposes include, but are not limited to, affordable housing development and rehabilitation. Historically, PAB financing has also been used by the City for economic and industrial development purposes. In 2020, the total amount available statewide is $604,667,280. Fifty percent of the state ceiling is allocated directly to statewide authorities and the other half is allocated directly to local governments based on population size. The City has been notified that, pursuant to Section 24-32-1706 of the Allocation Act, its allocation of the state ceiling for 2020 is $8,885,119. (Attachment 1) PAB capacity is merely the authority to take on debt and is not an allocation of funding. The City will not incur debt by assigning this allocation and this will not affect the City's credit rating. If a local government does not issue bonds or assign the bond cap to an eligible entity for a local project or projects by September 15 annually, the City allocation automatically reverts to the state’s pool of available bond capacity. The Colorado Housing and Finance Authority (CHFA) offers a 4% Low Income Tax Credit Program which is a financing mechanism for the development and rehabilitation of affordable housing. CHFA requires these types of financing deals to include private activity bonds. Historically, Fort Collins had assigned its annual allocation Agenda Item 11 Item # 11 Page 2 on a first come, first served basis. From 2009 through 2012, the Fort Collins allocation was not used locally and therefore reverted to the state’s pool of available bond capacity. In 2013, 2014, 2015 and 2017 the City assigned its full allocation to the Fort Collins Housing Authority, now Housing Catalyst (HC), for the rehabilitation of affordable rental housing units. In 2016, the PAB was assigned to CHFA for the benefit of two local affordable housing projects. As of 2018, the City implemented an application process for requesting the City’s annual allocation of PAB. The guidelines are set forth in the City’s General Financial Policies. Applications are due annually by March 15 and are reviewed by the City PAB committee. Finance policy states that the following factors be considered when making a recommendation for allocation of PAB capacity: • How well the project meets the land use, economic development and/or affordable housing goals of the City. • Project feasibility and timing. • Leverage of other investment into the project. • Maintenance of or increase in local tax base. • Competing uses for the City’s allocation. • Whether the City’s allocation should be used in multiple projects. • Whether the application should be considered by any City Board or commission. Interest historically has been limited to one or two applications per year. This year, there was unprecedented interest in the City’s PAB allocation. The City received four applications seeking more than $44 million in PAB capacity for the almost $8.9 million available. Some of these applications were for multiple projects. Two of the projects are new construction and the others were for rehabilitation or preservation of existing homes. The 2020 applications can be summarized as follows: Applicant Requested amount total Per project request PAB already secured Project Number of units New/Preserve Housing Catalyst $4.77M $2.61M $10M Swallow/Care 84 Both: 40 Preserved/44 New Restrictions $2.16M $12M Oak St. 78 New Neighbor to Neighbor $10M n/a Coachlight 68 Preserve n/a Aztec Apts 4 Preserve n/a Conifer 1 4 Preserve n/a Conifer 2 4 Preserve Mercy Housing $5.77M $5.77M $2.6M (Larimer County) Northfield 84 New Logan Capital Advisors $24M $13.5M Oakbrook 1 107 Preserve $10.5M Oakbrook 2 100 New Restrictions See Attachment 2 for project locations. Agenda Item 11 Item # 11 Page 3 City PAB Committee’s Findings The City’s PAB committee made up of staff representatives from Social Sustainability, Economic Health and Finance met and considered the four applications and made the following findings: • All applications were for worthwhile projects. • Adding restricted housing to the City’s affordable housing inventory is a current City priority. New construction requires less relocation of tenants which is an advantage in this time of COVID-19. • Applications for projects that already have some PAB committed showed leveraging and this indicates project feasibility and readiness. • The Committee favored using the 2020 allocation in multiple projects. • The Committee decided to once again bring recommendations to the Affordable Housing Board. PAB Committee 2020 Recommendations Based on the criteria listed in the Finance Policy and the City’s affordable housing goals, the Committee recommends partial funding of two applications allocating the City’s 2020 PAB capacity of $8,885,119 as follows: • $3,885,119 to Housing Catalyst for both new construction and rehabilitation of affordable housing • $5,000,000 to Mercy Housing for new construction of affordable housing This supports financing for 162 new homes and 84 home renovations. In this case, the renovation project will not only result in newly renovated units owned and operated by CARE Housing (a local mission driven non- profit) but will also provide cash proceeds to HC which will be invested in additional new housing construction or renovation. New construction and rehabilitation of affordable rental units is a permissible and beneficial use of the City’s 2020 allocation and supports the outcomes sought by the City’s Affordable Housing Strategic Plan. For HC and Mercy Housing to use the City’s allocation of PAB capacity, Council must adopt a resolution assigning the 2020 PAB allocation to HC and Mercy Housing. HC will issue the bonds for all the qualifying projects. CITY FINANCIAL IMPACTS The City will not issue the Private Activity Bonds and the bonds will not be obligations of the City. The debt service on the bonds will be repaid from revenue generated by the housing developments and does not constitute a debt of the City. This action will not affect the City's credit rating. The construction of 162 new units and the rehabilitation of 84 units will require goods and labor which will benefit the local economy. BOARD OR COMMISSION RECOMMENDATION At its May 5, 2020 meeting, the Affordable Housing Board voted unanimously to support the recommendation of the PAB Committee and the approval of the Resolution. (Attachment 3) PUBLIC OUTREACH The Affordable Housing Board heard this matter at its remote May meeting which was open to the public. The process to seek PAB capacity is detailed on the Social Sustainability Department’s web page and the guidelines are set forth in the City’s General Financial Policies. Agenda Item 11 Item # 11 Page 4 ATTACHMENTS 1. 2020 Private Activity Bond Direct Allocations (PDF) 2. Affordable Housing Board May 2020 Minutes DRAFT (PDF) 3. Location Map (PDF) Private Activity Bond Direct Allocations 2020 Colorado Private Activity Bond Direct Allocations Statewide Population in 2019: 5,758,736 Private Activity Bond Cap available in 2020: $604,667,280 Per Capita Multiplier: $105 Table 1: Allocations to Designated Local Issuing Authorities Local Issuer Population Population as % of State Population PAB Cap Denver 717,796 12.61% $38,110,648 Colorado Springs 473,928 8.32% $25,162,725 Aurora 373,334 6.56% $19,821,789 Douglas County 220,627 3.87% $11,713,967 El Paso County 209,852 3.69% $11,141,883 Jeﬀerson County 206,840 3.63% $10,981,962 Fort Collins 167,347 2.94% $8,885,119 Lakewood 156,493 2.75% $8,308,837 Weld County 149,370 2.62% $7,930,661 Thornton 141,062 2.48% $7,489,544 Arapahoe County 136,251 2.39% $7,234,114 Arvada 120,374 2.11% $6,391,135 Westminster 113,537 1.99% $6,028,132 Adams County 113,191 1.99% $6,009,763 Pueblo 111,650 1.96% $5,927,943 Centennial 110,833 1.95% $5,884,566 Greeley 107,026 1.88% $5,682,437 Boulder 106,456 1.87% $5,652,173 Larimer County 98,460 1.73% $5,227,637 Longmont 96,343 1.69% $5,115,234 Mesa County 89,438 1.57% $4,748,623 Loveland 77,226 1.36% $4,100,236 Broomﬁeld 69,453 1.22% $3,687,537 Castle Rock 64,818 1.14% $3,441,446 Grand Junction 64,191 1.13% $3,408,156 Boulder County 61,648 1.08% $3,273,141 Garﬁeld County 59,812 1.05% $3,175,661 Commerce City 58,499 1.03% $3,105,945 Parker 55,764 0.98% $2,960,733 Pueblo County 55,467 0.97% $2,944,965 Eagle County 54,863 0.96% $2,912,898 Littleton 47,929 0.84% $2,544,742 Fremont County 47,917 0.84% $2,544,108 1 ATTACHMENT 1 Table 1: Allocations to Designated Local Issuing Authorities (con- tinued) Local Issuer Population Population as % of State Population PAB Cap Brighton 40,629 0.71% $2,157,156 Northglenn 38,870 0.68% $2,063,764 La Plata County 37,343 0.66% $1,982,690 Englewood 34,612 0.61% $1,837,689 Wheat Ridge 31,369 0.55% $1,665,506 Summit County 30,974 0.54% $1,644,537 Delta County 30,935 0.54% $1,642,466 Fountain 30,618 0.54% $1,625,632 Windsor 29,053 0.51% $1,542,540 Lafayette 28,950 0.51% $1,537,071 Morgan County 28,504 0.50% $1,513,394 Elbert County 26,218 0.46% $1,392,020 Montezuma County 26,155 0.46% $1,388,675 Routt County 25,680 0.45% $1,363,455 Erie 25,591 0.45% $1,358,729 Teller County 25,057 0.44% $1,330,378 Montrose County 22,857 0.40% $1,213,570 Logan County 21,856 0.38% $1,160,427 Louisville 21,182 0.37% $1,124,637 Evans 20,972 0.37% $1,113,487 Golden 20,586 0.36% $1,092,993 Chaﬀee County 20,024 0.35% $1,063,156 Montrose 19,406 0.34% $1,030,342 Durango 19,059 0.33% $1,011,919 These calculations for municipalities and counties utilize population estimates from 2018, as these are the most recent year for which these estimates are available. The population of the state in that year was 5,694,311. Total cap available to designated local issuing authorities and the statewide balance: $302,333,640 Table 2: Allocations to State Issuing Authorities State Issuing Authority PAB Cap Colorado Housing and Finance Authority $292,333,640 Colorado Agricultural Development Authority $10,000,000 Total cap available to the Statewide Balance: $15,928,947 Total cap allocated to all issuing authorities: $604,667,280 2 1. CALL TO ORDER: 4:01 2. ROLL CALL • Board Members Present: Jen Bray, Catherine Costlow, Diane Cohn, Rachel Auldridge, • Recused Board Members: Kristin Fritz, Bob Pawlikowski, Tatiana Zentner • Staff Members Present: Beth Rosen, Yaz Haldeman, Sylvia Tatman-Burruss, Adam Molzer, Lindsay Ex, Sue Beck-Ferkiss, Brittany Depew • Guests: Marilyn Heller, Steve Kuehneman, Jenny Maeda, Dustin Harrington 3. AGENDA REVIEW 4. CITIZEN PARTICIPATION a) Marilyn Heller—League of Women Voters – panel on mobile homes will be next April, at meeting today it was shared that landlords are threatening to evict tenants with steep fines o Sue gave suggestion to visit https://www.fcgov.com/socialsustainability to learn more about governor’s eviction moratorium 5. APPROVAL OF MINUTES Diane moved to approve March minutes. Catherine seconded. Approved unanimously 4-0-0. 6. NEW BUSINESS A. Review of Private Activity Bond Committee’s Recommendations—Sue, Social Sustainability Every year, the Internal Revenue Service (IRS) gives the state of Colorado private activity bond capacity and can be paired with 4% tax credits. City has prioritized affordable housing projects for PABs in the past. Previously, have had enough capacity to meet demand. More projects are using these 4% credits than previously. Received $44.5 million in requests which shows great activity in our community but only have $8.9 million in capacity to provide. Decided to prioritize new construction and projects in better position to move forward. Committee (with representation from Social Sustainability, Finance & Economic Health Office) recommended that Housing Catalyst receive $3.89 million and Mercy Housing receive $5 million. Comments/Q&A: • Diane: Request from Housing Catalyst is a partnership, why did the request just come from them? o Sue: Housing Catslyst is the project manager so they took the lead on the application, and they will be issuing the bonds. ATTACHMENT 2 AFFORDABLE HOUSING BOARD REGULAR MEETING 5/7/2020 – MINUTES Page 2 • Diane: The gap between capacity and request amount is the largest I’ve ever seen. Is CHFA (Colorado Housing & Financing Authority) looking at that? o Sue: There is some discussion about changing the legislation at the federal level. • Jen: When it comes to new construction, are they unable to proceed without PAB? o Sue: The tax credits are contingent on PAB, but there are other possibilities for them to acquire bond capacity. • Diane: What if they don’t get the 4% tax credit? o Sue: Once you have the bonds, it’s not competitive for the 4%. • Jen: I’d feel comfortable going with the committee’s recommendations, but also want to encourage other applicants to apply again in the future. Diane moves to support the Private Activity Bond Committee’s recommendation to allocate bond capacity to Housing Catalyst and Mercy Housing. Catherine seconded. Passed unanimously 4-0-0. REST OF MINUTES REMOVED. Service Garmin, Layer Intermap, Credits: increment Sources: P Corp.Esri, , HERE, GEBCO, GeoBase, USGS, IGN, Kadaster FAO, NPS, NL, NRCAN, Ordnance Survey, Kong), (c) Esri OpenStreetMap Japan, METI, Esri contributors, China (Hong and the GIS User Community ! !! ! ! ! ! ! 1550 Blue Spruce Dr 1403 W Swallow Rd 1303 W Swallow Rd 140 E Oak St 613 Conifer St 713St Aztec Dr 619 Conifer 3200 Stanford Rd Northfield Affordable Printed: May 20, 2020 ! Housing Catalyst ! Logan Capital Advisors ! Mercy Housing ! Neighbor to Neighbor City Private of Activity Fort Collins Bonds ATTACHMENT 3 -1- RESOLUTION 2020-052 OF THE COUNCIL OF THE CITY OF FORT COLLINS AUTHORIZING THE ASSIGNMENT OF THE CITY’S PRIVATE ACTIVITY BOND ALLOCATION FOR 2020 TO HOUSING CATALYST AND MERCY HOUSING TO FINANCE THE NEW CONSTRUCTION AND REHABILITATION OF AFFORDABLE HOUSING UNITS WHEREAS, the City of Fort Collins is authorized and empowered under the laws of the State of Colorado (the “State”) to issue revenue bonds for purposes including the financing of multi-family rental housing projects for low- and moderate-income persons and families; and WHEREAS, the Internal Revenue Code of 1986, as amended (the “Code”), restricts the amount of tax-exempt bonds (“Private Activity Bonds” or “PAB”) which may be issued in the State (the “State Ceiling”); and WHEREAS, pursuant to the Code, the Colorado General Assembly adopted the Colorado Private Activity Bond Ceiling Allocation Act, Part 17 of Article 32 of Title 24, Colorado Revised Statutes (the “Allocation Act”), providing for the allocation of the State Ceiling among various State and local governmental units, and further providing for the assignment of such allocations from such governmental units to any entity or person with the authority to issue bonds; and WHEREAS, pursuant to an allocation under Section 24-32-1706 of the Allocation Act, the City has received a direct allocation of the 2020 State Ceiling for the issuance of Private Activity Bonds in the aggregate principal amount of $8,885,119 (the “2020 Allocation”); and WHEREAS, if the City does not issue bonds or assign its annual allocation to another entity by September 15 of each year, its allocation is relinquished to the statewide balance; and WHEREAS, the City received four application for the 2020 Allocation seeking PAB capacity for a total of nine housing projects; and WHEREAS, the City’s PAB Committee, consisting of staff from staff representatives from the City’s Social Sustainability, Economic Health and Finance departments, reviewed the applications and recommends assigning $3,885,119 of the 2020 Allocation to Housing Catalyst, and $5,000,000 of the 2020 Allocation to Mercy Housing, pursuant to Section 24-32-1706 of the Allocation Act; and WHEREAS, Housing Catalyst would use its portion of the 2020 Allocation for renovation of existing affordable housing units as well as construction of new affordable units at the Villages on Swallow in conjunction with CARE Housing, and construction of new affordable units at 140 Oak Street (the “HC Projects”); and WHEREAS, Mercy Housing would use its portion for construction of new affordable units at Northfield (the “Mercy Project”); and -2- WHEREAS, both Housing Catalyst and Mercy Housing have expressed their willingness to attempt to issue Revenue Bonds in an amount equal to or greater than the 2020 Allocation; and WHEREAS, the City Council finds that the 2020 Allocation can be utilized most efficiently by assigning it to Housing Catalyst to issue Private Activity Bonds for financing the HC Projects and to Mercy Housing for financing the Mercy Project, and that such assignments will advance the City’s objective of increasing the availability of adequate affordable housing for low- and moderate-income persons and families within the City; and WHEREAS, the Council wishes to assign $3,885,119 of the 2020 Allocation to Housing Catalyst and $5,000,000 of the 2020 Allocation to Mercy Housing, which assignments are to be evidenced by Assignment of Allocation agreements between the City and each of the applicants; and WHEREAS, the form of proposed Assignment of Allocation for each applicant are attached as Exhibits “A” and “B” and incorporated herein by reference. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council hereby makes and adopts the determinations and findings contained in the recitals set forth above. Section 2. That the City Council hereby approves assignment to Housing Catalyst of $3,885,119 of the City’s 2020 Allocation for the HC Projects as described herein. Section 3. That the City Council hereby approves assignment to Mercy Housing of $5,000,000 of the City’s 2020 Allocation for the Mercy Project as described herein Section 3. That the City Council hereby authorizes the Mayor to execute an Assignment of Allocation with Housing Catalyst in substantially the form attached as Exhibit “A,” and an Assignment of Allocation with Mercy Housing in substantially the form attached as Exhibit “B”, along with such other terms and conditions as the City Manager, in consultation with the City Attorney, determines are necessary or appropriate to protect the interests of the City or effectuate the purposes of this Resolution. Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 2nd day of June, A.D. 2020. _________________________________ Mayor ATTEST: _____________________________ City Clerk [Draft – June 2, 2020] ASSIGNMENT OF ALLOCATION THIS ASSIGNMENT (the “Assignment”), dated ________ , 2020 is between the City of Fort Collins, Colorado, a municipal corporation (the “Assignor”), and Housing Catalyst, a body corporate and politic (the “Assignee”). RECITALS A. The Assignee intends to finance (i) the construction of 44 new units of rental housing and rehabilitation of 40 additional units at Village on Swallow/CARE Swallow, located at 1303 and 1403 West Swallow Road, and (ii) the construction of 78 new units of rental housing at 140 Oak Street, all for households with incomes ranging from 0% to 60% of area median income (the “Projects”.) The Projects will each be designed to qualify as a “project” within the meaning of Title 29, Article 4, Part 2, Colorado Revised Statutes, as amended (the “Act”). B. The Assignee intends to provide for the issuance of its Multifamily Housing Revenue Bonds (the “Proposed Bonds”), pursuant to the provisions of the Act for the purpose of financing the Projects. C. The Assignee has requested that the Assignor assign to the Assignee $3,885,119 of the Assignor’s 2020 allocation (the “Allocation”) under the bond ceiling for the State of Colorado and its issuing authorities (“the State Ceiling”) computed under Section 146(d) of the Internal Revenue Code of 1986 (the “Code”) as provided for the Assignor as a “designated local issuing authority” under part 17 of article 32 of title 24, Colorado Revised Statutes (the “Allocation Act”), for use in connection with the financing of the Projects. D. Subject to the terms and conditions set forth herein, the Assignor desires to assign to the Assignee, and the Assignee desires to accept, $3,885,119 of the Assignor’s 2020 allocation from the State Ceiling. ASSIGNMENT In exchange for the agreements set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 1. The Assignor hereby assigns and transfers to the Assignee $3,885,119 of the Assignor’s 2020 Allocation from the State Ceiling for private activity bonds. The Assignor and the Assignee understand that such assigned allocation shall automatically be relinquished to the “Statewide Balance” as defined under the Allocation Act unless (a) the Proposed Bonds are issued by the Assignee on or before September 15, 2020, or (b) Section 24-32-1706(3)(c), C.R.S., applies. 2. The Assignor represents that it has received no monetary consideration for the assignment set forth above. EXHIBIT A 2 3. The Assignee hereby: (a) accepts the assignment of $3,885,119 of the Assignor’s Allocation from the State Ceiling described above; (b) agrees to use its best efforts to issue and use the Proposed Bonds for the purpose of financing the Projects; and (b) agrees to abide by each of the terms and conditions of this Assignment in connection with the use of such Allocation. 4. The Assignor hereby consents to the election by the Assignee, if the Assignee in its discretion so decides, to treat all or any portion of the assignment set forth herein as an allocation for a project with a carryforward purpose. 5. This Assignment shall not constitute a debt or indebtedness or financial obligation of the Assignor within the meaning of the constitution or statutes of the State of Colorado, nor give rise to a pecuniary liability or charge against the general credit or taxing power of the Assignor. [The remainder of this page is intentionally left blank] [Draft – June 2, 2020] [Signature Page to Assignment of Allocation] S-1 IN WITNESS WHEREOF, the Assignor and the Assignee have caused this instrument to be executed to be effective as of the date and year first written above. CITY OF FORT COLLINS, COLORADO, as Assignor ____________________________________ Wade O. Troxell, Mayor ATTEST: APPROVED AS TO FORM: ____________________________________ ____________________________________ City Clerk Assistant City Attorney ____________________________ _______________________________ (print name) (print name) HOUSING CATALYST, as Assignee By: ________________________________ Its: ________________________________ ATTEST: By: ________________________________ Its: ________________________________ [Draft – June 2, 2020] ASSIGNMENT OF ALLOCATION THIS ASSIGNMENT (the “Assignment”), dated ________ , 2020 is between the City of Fort Collins, Colorado, a municipal corporation (the “Assignor”), and Mercy Housing Mountain Plains, a Colorado nonprofit corporation(the “Assignee”). RECITALS A. The Assignee intends to finance the construction of 84 new units of rental housing at Northfield, for households with incomes ranging from 30% to 70% of area median income (the “Project”.) The Project will be designed to qualify as a “project” within the meaning of Title 29, Article 4, Part 2, Colorado Revised Statutes, as amended (the “Act”). B. The Assignee intends to provide for the issuance of its Multifamily Housing Revenue Bonds (the “Proposed Bonds”), pursuant to the provisions of the Act for the purpose of financing the Projects. C. The Assignee has requested that the Assignor assign to the Assignee $5,000,000 of the Assignor’s 2020 allocation (the “Allocation”) under the bond ceiling for the State of Colorado and its issuing authorities (“the State Ceiling”) computed under Section 146(d) of the Internal Revenue Code of 1986 (the “Code”) as provided for the Assignor as a “designated local issuing authority” under part 17 of article 32 of title 24, Colorado Revised Statutes (the “Allocation Act”), for use in connection with the financing of the Projects. D. Subject to the terms and conditions set forth herein, the Assignor desires to assign to the Assignee, and the Assignee desires to accept, $5,000,000 of the Assignor’s 2020 allocation from the State Ceiling. ASSIGNMENT In exchange for the agreements set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 1. The Assignor hereby assigns and transfers to the Assignee $5,000,000 of the Assignor’s 2020 Allocation from the State Ceiling for private activity bonds. The Assignor and the Assignee understand that such assigned allocation shall automatically be relinquished to the “Statewide Balance” as defined under the Allocation Act unless (a) the Proposed Bonds are issued by the Assignee on or before September 15, 2020, or (b) Section 24-32-1706(3)(c), C.R.S., applies. 2. The Assignor represents that it has received no monetary consideration for the assignment set forth above. 3. The Assignee hereby: EXHIBIT B 2 (a) accepts the assignment of $5,000,000 of the Assignor’s Allocation from the State Ceiling described above; (b) agrees to use its best efforts to issue and use the Proposed Bonds for the purpose of financing the Project; and (b) agrees to abide by each of the terms and conditions of this Assignment in connection with the use of such Allocation. 4. The Assignor hereby consents to the election by the Assignee, if the Assignee in its discretion so decides, to treat all or any portion of the assignment set forth herein as an allocation for a project with a carryforward purpose. 5. This Assignment shall not constitute a debt or indebtedness or financial obligation of the Assignor within the meaning of the constitution or statutes of the State of Colorado, nor give rise to a pecuniary liability or charge against the general credit or taxing power of the Assignor. [The remainder of this page is intentionally left blank] [Draft – June 2, 2020] [Signature Page to Assignment of Allocation] S-1 IN WITNESS WHEREOF, the Assignor and the Assignee have caused this instrument to be executed to be effective as of the date and year first written above. CITY OF FORT COLLINS, COLORADO, as Assignor ____________________________________ Wade O. Troxell, Mayor ATTEST: APPROVED AS TO FORM: ____________________________________ ____________________________________ City Clerk Assistant City Attorney ____________________________ _______________________________ (print name) (print name) MERCY HOUSING MOUNTAIN PLAINS, as Assignee By: ________________________________ Its: ________________________________ ATTEST: By: ________________________________ Its: ________________________________