15 - Celebration Paris - Paris Housing Authority ProjectItem No. 15
TO: Mayor, Mayor Pro Tem & City Council
FROM: Grayson Path, City Manager
SUBJECT: Celebration Paris / Paris Housing Authority Project
DATE: January 8, 2024
BACKGROUND:
On February 14, 2022, the City Council approved Resolution 2022-11 in support of J -H Paris
Realty, LP's proposal to construct a multi -family affordable elderly rental housing development
to be located at 4415 Lamar Avenue, to be named "Celebration Paris". This project was to be
funded in part with tax credits through the State of Texas. In September 2022, the Texas
Department of Housing and Community Affairs granted a commitment notice to Celebration Paris
for a 9% competitive tax credit.
STATUS OF ISSUE:
In September 2023, Celebration Paris reached out to City Management to inform us that due to a
number of financial issues with construction costs, labor shortages, interest rates, etc., the project
feasibility had become challenging. To solve this, they began seeking a partnership with the Paris
Housing Authority by which the PHA would own the land, thus making it tax exempt, and the
Celebration Paris would build and manage the facility. This would be a long term lease, the
conclusion of which would result with the building reverting to PHA ownership. This would have
benefits for the PHA (expanding housing availability for many of their clients), the Celebration
Paris (allowing their project to proceed), and the City (expanding housing options for our citizens).
As of the writing of this agenda memo, the PHA Board is supportive of this partnership.
Celebration Paris and the PHA are currently in negotiations for a contract. In the meantime, should
this partnership proceed, the TDHCA will need to see a letter / resolution of support for this
partnership as it is a change from the original application in 2022.
This partnership and tax exemption would only apply to the portion of land intended for the
residential development, which is interior of the property. That portion along Lamar Avenue will
be outside of this partnership and thereby open for retail / commercial development (thus property
taxes to the city). Both Celebration Paris and the Paris Housing Authority assured City
Management that this would be the case. Celebration Paris does not have immediate plans for
developing this in to retail as they are focused on getting the 2022 tax credit residential project
started and moving, but that is indeed the long term plan.
Representatives of Celebration Paris are planning to be present tonight and will have a short
presentation for the City Council.
BUDGET:
There is no known direct cost to the City of Paris. There however would be an impact to our
revenue stream. The original project would not have been tax exempt, thereby paying the City
property taxes (of an unknown amount). Should it be owned by the Paris Housing Authority, it
would be tax exempt. This however is a reality should the PHA ever expand and build. There is
an added benefit to the city as it benefits some of our lowest income residents, which has indirect
benefits to the city as a community and municipal operation.
OPTIONS
1. Approve a resolution supporting the project and partnership between the Celebration Paris
and Paris Housing Authority.
2. Do not approve the resolution and/or request additional information.
RECOMMENDATION:
1. Approve a resolution supporting the project and partnership between the Celebration Paris
and Paris Housing Authority,
RESOLUTION NO. 2023-
A RESOLUTION OF THE CITY OF PARIS, TEXAS CONTINUING SUPPORT OF JAVELIN
PARTNERS, LLC'S CELEBRATION PARIS ELDERLY HOUSING DEVELOPMENT IN
LIGHT OF THE PROJECT'S CHANGE IN SCOPE AND TO A PROPERTY -TAX-EXEMPT
STRUCTURE; AUTHORIZING THE CITY MANAGER, OR THEIR DESIGNEE, TO SIGN A
LETTER ACKNOWLEDGING THE CITY'S CONTINUED SUPPORT; AND PROVIDING AN
EFFECTIVE DATE.
WHEREAS, on February 14, 2022, City Council passed Resolution 2022-011 in
support of J -H Paris Realty, LP's ("the Applicant") proposal for the new construction of a
multi- family affordable elderly rental housing development to be located approximately
at 4415 Lamar Avenue, in the City of Paris, Lamar County, Texas to be named Celebration
Paris (the "Project"); and
WHEREAS, in September 2022, the Texas Department of Housing and Community
Affairs ("TDHCA") granted a Commitment Notice for the 2022 9% competitive tax
credits for the Project; and
WHEREAS, in September 2023 the Applicant notified the City that a reduction
in the number of units and a change to the design of the Project would be necessary
due to construction cost increases, labor shortages, interest rate increases and
reduced tax credit equity pricing; and
WHEREAS, in October 2023 the Applicant began negotiations with the
Housing Authority of the City of Paris ("the PHA") to enter into the ownership
structure, whereby a wholly-owned of affiliate of PHA will own the property so that it
will qualify for property -tax -exemption; and
WHEREAS, the Applicant now intends to partner with the PHA and enter into a
Memorandum of Understanding ("MOU") regarding same; and
WHEREAS, in November 2023 the Applicant requested the City sign a letter
to TDHCA acknowledging the change in scope and partnership with the PHA for
property tax -exemption; and
WHEREAS, the City continues its support of the Project, as expressed in
Resolution 2022-011, including the changes in Project scope and ownership
structure;
NOW, THEREFORE, THE COUNCIL OF THE CITY OF PARIS HEREBY
RESOLVES:
Section 1. That recitals contained in the preamble of this Resolution are
incorporated by reference into the body of this Resolution as if fully set forth herein.
Section 2. That the City re -affirms its support for the Project provided in
Resolution 2022-011, subject to any conditions contained therein.
Section 3. That the City Manager is hereby authorized, empowered, and directed
to provide a letter to TDHCA acknowledging the City is advised of the Project's change in
scope and property tax-exempt ownership structure making the development of the
Project financially feasible.
Section 4. That this Resolution shall become effective immediately upon its
passage and approval.
PASSED AND APPROVED this 8t" day of January, 2024.
Reginald B. Hughes, Mayor
ATTEST:
Janice Ellis, City Clerk
APPROVED AS TO FORM:
Stephanie H. Harris, City Attorney