Asset management activities strive to maximize the value and return of Affordable Housing assets for all stakeholders. If CUB holds the permanent loan or is the tax credit investor, Asset Management will monitor the project during its initial fifteen-year compliance period, the life of the loan, or term of the investment. Once the project has been placed in service and stabilized, the project will be expected to maintain a minimum set of standards. They are as follows:
- The project must remain in full compliance with IRC §42, local, state, and federal regulations.
- Debt coverage ratio more than 1.10.
- Occupancy rate better than break-even.
- Taxes and insurance must remain current.
- Reporting requirements must be maintained according to loan and/or partnership covenants.
- The project must pass regularly scheduled site visits with minimal deferred maintenance.
- All commitments satisfied for replacement reserves or other restricted accounts.
Over the life of the project, capital improvements will need to be performed. If CUB is the managing agent for the replacement reserves, a minimum set of criteria will need to be observed in order to release funds. First, replacement reserve payments must stay current. The balance in the replacement reserve should not fall below six months of replacement reserve payments. In conjunction with the above principals, only certain capital improvements are allowed and the request must be submitted on the appropriate form with supporting documentation. Please see the following links.