HCS HOUSTON HOUSE INC

THE ORGANIZATION CONTINUED ITS PRIMARY ACTIVITY OF OWNING AND OPERATING THE HOUSTON HOUSE APARTMENTS, A 50-UNIT APARTMENT COMPLEX LOCATED IN VICTORIA, TEXAS UNDER THE LOW-INCOME HOUSING PRESERVATION AND RESIDENT HOMEOWNERSHIP ACT (LIHPRHA)OF 1990 FOR THE BENEFIT OF FAMILIES AND INDIVIDUALS NEEDING LOW-INCOME HOUSING.THE ORGANIZATION CONTINUED TO PRESERVE THE PROJECT AS LOW-INCOME HOUSING BY MAINTAINING PROPERTY OPERATIONS IN COMPLIANCE WITH THE REGULATIONS OF THE U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD). THE ORGANIZATION MAINTAINED A HUD PROPERTY BASED SECTION 8 HOUSING ASSISTANCE PAYMENT (HAP) RENTAL ASSISTANCE CONTRACT FOR ALL 50 UNITS. THE HAP RENT ASSISTED UNITS WERE MADE AVAILABLE TO FAMILIES AND INDIVIDUALS WITH INCOMES OF LESS THAN 30% OF AREA MEDIAN INCOME.IN ADDITION, THE ORGANIZATION OPERATIONS WERE MAINTAINED IN ACCORDANCE WITH THE PROVISIONS OF A LAND USE RESTRICTION AGREEMENT (LURA) EXECUTED BETWEEN THE ORGANIZATION AND THE TEXAS DEPARTMENT OF HOUSING AND COMMUNITY AFFAIRS (TDHCA), WHICH REMAINS IN EFFECT UNTIL DECEMBER 22, 2044.THE ORGANIZATION CONTINUED TO RECEIVE THE FOLLOWING TAX EXEMPTIONS:INTERNAL REVENUE SERVICE 501(C) (3) INCOME TAX EXEMPTION.VICTORIA COUNTY, TEXAS, APPRAISAL DISTRICT 100% PROPERTY TAX EXEMPTION.STATE OF TEXAS FRANCHISE TAX EXEMPTION.STATE OF TEXAS SALES TAX EXEMPTION.THE ORGANIZATION CONTINUED TO PROVIDE PROGRAMS, ACTIVITIES, AND SERVICES FOR THE YOUTH AND ADULT RESIDENTS.IN LATE 2013 THE ORGANIZATION BEGAN A REHABILITATION PROJECT TO PRESERVE THE HOUSTON HOUSE APARTMENTS (PROPERTY) AS QUALITY LOW- INCOME HOUSING. IN DECEMBER 2014, THE ORGANIZATION CLOSED ON A $2,300,000 NON- RECOURSE HOME FIRST LIEN MORTGAGE PAYABLE TO THE TDHCA. PROCEEDS OF THE LOAN WERE USED IN 2015 AND 2016 FOR THE CONSTRUCTION NEEDED TO REHABILITATE THE PROPERTY. THROUGH 2016 HOUSING AND COMMUNITY SERVICES, INC. (HCS) ADVANCED $415,000 FOR COSTS ASSOCIATED WITH OBTAINING THE LOAN AND PROVIDING CONSTRUCTION ADVANCE FUNDING. IN ADDITION TO THE TDHCA LOAN FOR THE REHABILITATION PROJECT, HUD APPROVED A SUBORDINATE SURPLUS CASH NOTE PAYABLE TO HCS IN THE AMOUNT OF $357,053. FINALLY, WITH THE CLOSING OF THE TDHCA LOAN, HUDSON HOUSING CAPITAL, LLC PROVIDED A $46,000 GRANT SOLELY FOR THE REHABILITATION PROJECT. THE REHABILITATION PROJECT WAS COMPLETED DURING 2016.