¹ Housing Assistance Council, Taking Stock of Rural Housing and Poverty for the 1990s, Washington, D.C., 1994.

²California and Arizona have both begun to officially recognize the presence of colonias within their jurisdictions in recent years as illustrated by the Community Development Block Grant (CDBG) set aside funds each has budgeted for use in the colonias in the fiscal year since 1995.  California has budgeted 5 percent of its CDBG funds for the colonias, while Arizona has set aside a full 10 percent.

³  This map is attached as an example of how different definitions impact colonia communities' access to available programs. Clearly, devising assistance programs in the colonias utilizing these programs requires skillful negotiation by local groups.  A combination of appropriate governmental funds and private resources is usually required to implement effective projects in these communities.

⁴  Comments by Rose Garcia at the Colonias Meeting convened by Ford Foundation and Bank of America, Dallas, Texas, June 6-7, 1996.

⁵ Comments by Moises Loza, Executive Director, Housing Assistance Council, at Dallas meeting.

⁶ Zixta Q. Martinez and Charles Kamasaki, Colonias: A Policy Framework, paper presented at Fannie Mae Research roundtable series, Washington, D.C., October 1995.

⁷ El Paso Community Foundation, The Border/La Frontera, El Paso, TX, May 1996.

⁸ Testimony by Dr. Jorge Chapa, University of Texas, at a Colonias Hearing organized by the Texas Senate Committee on International Relations, Trade and Technology, Laredo, January 30, 1996.

⁹ Discussion at Colonias Meeting convened by Ford Foundation and Bank of America, Dallas, TX June 6-7, 1996.

¹⁰ University of Texas, LBJ School of Public Affairs, Colonias Housing and Infrastructure: Current Population and Housing Characteristics, Future Growth, and Housing, Water and Wastewater Needs, Preliminary Report, January 1996. (Most of the data cited in this sections is from this report.)

¹¹ Comments by Moises Loza at the Dallas meeting.

¹² New Mexico Environment Department, Water, and Wastewater Disposal Needs of Colonias in New Mexico, Santa Fe, NM, May 1992.

¹³ At the time this research was undertaken, information on the colonias in California and Arizona was rather limited.

¹⁴  Information reported in this section is abstact from an unpublished literature review conducted by HAC under a contract with the U.S. Department of Agriculture.

¹⁵ Maquiladoras are essentially twin plants, with the parent company located on the U.S. side and its manufacturing subsidiary located on the Mexican side of the international border.  A number of colonia residents are employed by maquilas. Occasionally, colonia residents fron the U.S. side even cross over to the Mexican side for work.

¹⁶ The Texas Senate Committee hearings and information gathering visit to the Lower Rio Grande Valley were funded under a separate contract between HAC and the United States Department of Agriculture (USDA).

¹⁷ This practice has been curbed since 1995 with the passage of legislation by the state to tighten existing loopholes.

¹⁸ HAC site visit to New Mexico, July 9, 1996. The use of trailer homes in New Mexico colonias is far more extensive than in the colonias in Texas. In fact, the colonias of Doña Ana County often look like giant, chaotic mobile home parks.

¹⁹At this time water services to the core community of Anthony were provided by a private water system. The rest of the colonia did not have any water system in place. Many residents depended on wells for their water supply.

²⁰ The construction of three-bedroom units serves the needs of the traditionally large families that reside along the border in New Mexico. The homes built by TDS are typical of RHS-funded self-help hoousing units constructed anywhere in the country. Interestingly, their design differs from that adopted by Proyecto Azteca, another nonprofit group that builds homes for colonia residents. The Proyecto Azteca homes are sedcribed later in this report.

²¹ TDS had construction and other loans from a variety of sources for competing Tierra Linda Phase II. These lenders included HAC, Bank of America, Neighborhood Reinvestment Corporation and First Federal Bank, among others.  Eventually, the interest owed by TDS was rolled into the lot costs. Unfortunately, as a result of this delay, the families had to pay more for their lots.

²² The Border Low Income Housing Coalition (BLIHC) is an ad hoe group of more than 50 government policy makers, local officials, low-income residents of border colonias, and representatives of nonprofit organizations such as housing authorities, community action agencies, and housing and community development advocacy organizations. The BLIHC developed a work plan for addressing the extreme poverty conditions in th eborder colonias in 1993, and at the time of this study was in the process of updating their recommendations. The Coalition has broad-based grassroots support along the Texas-Mexico border.

²³ Testimony of Rafael Torres before the Texas Senate Committee on International Relations, Trade and Technology, Laredo, January 30, 1996.

²⁴ World Enviornment Center, Envi ronmental, Health, and Housing Needs and Nonprofit Groups in the U.S. Mexico Border Area, Arlington, VA 1992.

²⁵ Eduardo Cantu and Jose Carlos Lozano, Necesidades de vivienda en los trabajadores de la industria maquiladora le Nuevo Laredo, Cuadernos de la Facultad, Numero 7, 1991.

²⁶ All the interviews for this case study were conducted in early July 1996.

²⁷ Intrust, Inc. was founded in 1985 by James F. Mingey, who serves as its president. Intrust helps finance and develop affordable multifamily rental housing in several marketplaces around the country, and handles about $25million a year in corporate investments in affordable housing projects. Most of Intrust's activities focus on structuring transactions that utilize the Low Income Housing Tax Credit program, and providing consulting assistance to for-profit and nonprofit housing developers. Its subsidiaries include Intrust Technologies and Trust, USA Ltd., a NASD securities dealer.  Intrust's first Texas Housing Opportunity Fund (THOF I) raised capital to finance six seperate projects with over 750 affordable housing units in Texas. THese projects have all been placed in service. Intrust modeled THOF II on the structure of THOF I, inspired by its success with the earlier fund.

²⁸ In this instance, the general partner has engaged the following consultants to assist it with the due diligence review of properties in which it may acquire an interest, and with the acquisition of these properties: Barnes Investment, Inc.; Housing Development Partners; The shenandoah Group, Inc.; Small Business Advisiors; Walter J. Moreau. In addition, operating this partnership requires the expertise of numerous legal consultants. These include counsel to the partnership, special tax counsel to the partnership, and counsel to the placement agent.

²⁹  The THOF II has also been structured to allow the corporate institution investor to match capital payments to expected annual tax benefits. The investor can do this by borrowing from an outside source to fund its capital contribution and then repay it over a period of eight years. The cumulative after-tax benefit can exceed the investor's payment stream. On an annual basis, it is anticipated that after the first full year of project operations, an investor may be able to fund its capital commitment through the annual tax savings. The forecasted benefits to all limited partners in THOF II are explained in the Fund's investment summary brochure, obtaining through the Texas Housing Corporation.

³⁰ PWF was one of the first mortgage lenders approved under the DUS Program in 1988 and at the time of this study had a servicing portfolio of over 200 loans with an outstanding principal balance of approximately $1 billion. This portfolio consists of over 35,000 apartment units in more than 20 states.

³¹ The debt ratio is 1.08 to 1 on hard debt payments and the yield on THOF's investment is 12.5 percent.  These are typically below the investment guidelines for the fund.  However, the Fund did decide to invest in this project for the reasons stated.

³² Office of the Texas Attorney General (Figures based on three year averages, 1993-1955, from the Texas Employment Commission and Bureau of Labor Statistics, July 1996.)

³³ Until recently, Proyecto Azteca used this demonstration house as its office. A few months ago, in early 1996, the organization raffled the unit to a colonia resident and moved to a larger office space owing to a growth in staff.

³⁴ The State of Texas has created a special self-help center program in 1996 to assist colonia residents. The state has funded five organizations (or consortia of organizations) to operate self-help centers along the Texas border. Each center service approximately five colonias in its vicinity and provides a variety of services including housing a construction tool lending library and providing construction training to colonia families to enable them to construct their own homes. The program is modeled after Proyecto Azteca's regular operations, and has enabled the organization to access much needed administrative funding as well as to expand its self-help housing program.

³⁵ The following list of criteria has been taken directly from Proyecto Azteca's own materials describing their program to interested participants. Proyecto has the ability to be somewhat flexible with eligibility criteria when selceting families for funding through the county's HOME program.  State funding requires stricter adherence to established guidlines.

³⁶ It should be noted that Proyecto Azteca's houses blend in very well with the surrounding homes. Resting units on piers is common proactice throughout Hidalgo County.

³⁷ This Bank and Commission would play a different role than NADBank and BECC. Refer to Appendix A for a brief description of NADBANK and BECC.

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