THE HONORABLE BILL WALKER
Governor, State of Alaska
THE HONORABLE BYRON MALLOTT
Lieutenant Governor, State of Alaska
P.O. BOX 110001
JUNEAU, ALASKA 99811-0001
Dear Governor Walker and Lt. Governor Mallott:
The Alaska Housing Finance Corporation (AHFC) celebrated its 45th Anniversary in FY16.
Since 1971, the corporation has been guided by a mission of providing residents across Alaska access to safe, quality and affordable housing.
In the past decade AHFC has, just like other short-term investors, been faced with historically low mortgage interest rates that have been beneficial for Alaskans but a challenge to the corporation’s bottom line. As recently as FY14, we reported a small net operating loss of $3.4 million but FY15 brought about a positive trend that carried over into FY16. We are very pleased to report the outcome of FY16:
Our commitment to the State of Alaska’s dividend increased to $30.5 million, up $4.6 million from FY15. Since 1986, AHFC’s total cumulative contribution to the state is close to $2 billion. Also, we increased our revenue, reporting a net gain of $14.2 million compared to $8.5 million in FY15.
Other encouraging particulars:
- Our mortgage portfolio increased by 5.8 percent with an outstanding balance of $2.8 billion, and the bond portfolio used to finance the mortgages decreased 5.4 percent to $2.1 billion.
- Mortgages supported 1,752 families and individuals moving into new homes, with nearly half as first time homebuyers. The portfolio at fiscal year-end contained 14,939 loans.
- Thirty-day delinquencies on outstanding mortgages continued to decrease from 3.9 percent in FY15 to 3.7 percent in FY16. The foreclosure rate fell for the same time period from 0.55 percent to 0.29 percent, a 46 percent decrease.
- Total operating expenses went down 7.7 percent with total net position holding at $1.5 billion.
- AHFC remains one of the strongest housing finance agencies nationwide according to the three rating agencies, Standard & Poor’s Ratings Service, Fitch Ratings and Moody’s Investment Services.
The positive financial performance in FY16 was accompanied by a statewide focus on affordable housing. Midway through the fiscal year, your Housing Summit offered a unique opportunity for diverse interests from across the state to weigh in on recommendations about how to solve the shortage of affordable housing. The report from the Summit, issued in April, points to potential future actions and AHFC is eager to continue our work in collaboration with other entities to solve some of the pressing issues in the state.
In conclusion, AHFC is proud of our role as the state’s public housing authority, an offeror of mortgage products and supporter of energy efficient and quality construction, and we greatly value the trust and support given to us by you and other elected officials.
By staying true to our mission we’re confident in our ability to continue to deliver benefits to the state and all Alaskans.