Housing Trust Fund Corporation Office of Community Renewal Chris - - PowerPoint PPT Presentation

Housing Trust Fund Corporation

Office of Community Renewal Chris Leo, President

March 29, 2017

NYS HOME Local Program

Small Rental Development Initiative (SRDI) Application Technical Assistance Webinar

March 29, 2017

• Welcome and Introductions
• NYS HOME Program & SRDI Project Description
• Project Assistance, Developer Fees, Contract Term
• CHDO’s
• Application Resources
• Project Management Plan & Questions
• Pro Forma Budget Workbook & Instructions
• Project Requirements
• NYS Grants Gateway & CDOL
• Rating Criteria, Funding Priorities and Application Tips
• Technical Assistance, Q & A & Wrap-up

Agenda

Welcome and Introductions

Ann M. Petersen, LEED AP, Director (Albany Regional Office) ann.petersen@nyshcr.org Stephanie Galvin-Riley, Assistant Director (Albany Regional Office ) stephanie.galvin-riley@nyshcr.org Program Managers: Caillin Furnari (Albany Regional Office) caillin.furnari@nyshcr.org Richard Baldwin (Syracuse Regional Office) richard.baldwin@nyshcr.org Emma Watson (Buffalo Regional Office) emma.watson@nyshcr.org

Welcome and Introductions

Finance and Administration (Albany Regional Office) Alex Smith, Manager of Finance and Compliance alex.smith@nyshcr.org Articia Hill, Administrative Operations - IDIS Assistance articia.hill@nyshcr.org

Shout Outs: Housing Trust Fund Corporation (HTFC) and Homes and Community Renewal (HCR) staff statewide helping to promote SRDI and may provide environmental review, construction inspection and asset management expertise for awarded projects. Monte Franke, Franke Consulting

SRDI RFP and related documents available at: www.nyshcr.org/Funding/SRDI/

New York State HOME Program

• General management and oversight by Housing Trust Fund Corporation

(HTFC) Office of Community Renewal (OCR), under the direction of Chris Leo, President.

• 2 Program Areas:

̶ HOME Local - 60% of funds for small scale projects: homebuyer assistance, owner occupied housing rehabilitation, rental rehabilitation, manufactured housing replacement, housing development, tenant based rental assistance and new SRDI. Managed by HTFC OCR, Ann Petersen, Director. ̶ HOME Capital - 40% of funds for large scale multi-unit rental projects, typically involving Federal or State Low Income Housing Tax Credits. Managed by HCR, Sean Fitzgerald, Assistant Commissioner, HCR.

Project Description

Specialty RFP Applications due in Community Development On Line (CDOL) Application System by Wednesday, May 10, 2017, 3:00pm

• Non-profit developed, owned and managed rental housing of 2-25 units (25

unit maximum project size), no geographical restrictions, eligible statewide.

• 1 or more buildings on a single site or multiple sites under common ownership,

financing and management

• Serving renters making less than 80% AMI, more than 5 units, then 20%

targeted to under 50% AMI

• If you have funding other sources than HOME, you must be able to show

evidence of commitment, as required by the HOME rule.

Project Description

• $15 Million
• HOME rules require a 25% match. HTFC has met the federal

match requirement for SRDI funds through excess match generated from other State funded affordable housing activities, therefore, SRDI does not have a match requirement.

• Rehabilitate what you already own, acquire and rehabilitate what

you will own or newly construct what you will own.

• Who is the eligible Developer-owner ?
• Market Need

Project Description

• Due to HUD requirements, funds need to be committed and expended
• n a shorter than usual time frame, therefore, the requirements for a

quick application response and selection of ready-to-go projects is essential.

• Awardees should expect the process from award to contract to be a be

a continuing conversation with the HTFC and HOME Local staff to finalize project details.

• Awards estimated Summer 2017, conditional commitment pending

environmental approval expected Fall 2017.

Project Description

• The Developer-owner must manage or hire a property manager to
• versee the long term management responsibilities of the rental

housing throughout the required Period of Affordability (POA), typically 15 to 20 years.

• The Developer-owner must be in charge of all aspects of development

process to include: identification, procurement and oversight of contractors, negotiation of land use/permit, zoning approvals, securing non-HOME financing, selecting architects, engineers, housing rehabilitation specialists and must oversee the progress of all work paid with HOME funds and determine the reasonableness of costs.

• The Developer-owner must demonstrate current or future site control.

Applicants must submit as a part of the application, current ownership documentation such as a deed or future ownership documentation such as an executed purchase option.

Project Description

• The housing must be used for permanent or transitional low income

rental housing as permitted by the HOME Final Rule, group homes and Single Room Occupancies (SROs) are eligible.

• The Developer-owner must be the sole owner of the property during

development and the required POA. The project cannot be co-owned with another entity.

• Projects that are not eligible for HOME funding include shelters,

temporary housing, student housing, Federal Public Housing units, and properties that were previously financed with HOME and are under an active HOME regulatory agreement and POA.

• Due to the time constraints for the commitment and expenditure of

funds, projects that include State or Federal Low Income Housing Tax Credits as a financing source are also not eligible.

National Environmental Protection Act (NEPA)

• NYS HOME Local Program awarded projects are subject to the provisions
• f the National Environmental Policy Act (NEPA) and a review is done to

ensure the project activities will not harm the environment.

• HTFC may elect to execute a conditional commitment of HOME funds as

permitted by HUD Notice CPD-01-11, to meet program commitment

• requirements. 24 CFR 58.22 prohibits the commitment or expenditure of

HOME funds or any other funds until the environmental review process is complete and the environmental clearance and subsequent release of funds has been received.

• The Developer-owner must refrain from taking any choice limiting actions
• n the project site(s) through the environmental clearance of the NEPA

and SEQRA reviews.

National Environmental Protection Act (NEPA)

• The Developer-owner may not: acquire or enter into a contract

to acquire; demolish or clear; construct or rehabilitate or take any other action that would limit the choices of HTFC during the environmental review process.

• If prohibited activities are undertaken prior to receiving the

approval or release of funds, the applicant is at risk for non- approval of the NEPA review, denial of assistance and repayment of HOME funds.

National Environmental Protection Act (NEPA)

• From the date of the issuance of the RFP (March 15, 2017) through

when HCR EAU notifies the Developer-owner of environmental clearance, only project planning and other exempt activities may be conducted.

• Developer-owner cannot execute a purchase contract for acquisition
• f property during the time from the release of the RFP through the

completion of the environmental clearance, however pre-existing contracts are permitted.

• Reasonable and documented eligible planning and other exempt

activities incurred costs may be reimbursed within 12 months of the Developer-owner’s contract execution with the HTFC.

• RFP offers maximum HOME funds available to allow the Developer-
• wner to request funds sufficient to deliver an affordable rehabilitated or

new construction small rental project that will be sustainable throughout the required POA.

• HOME funds provided as deferred loans, 0% interest, due on sale,

requires full repayment throughout the POA (sale or non-compliance) that is secured by a regulatory agreement and note and mortgage. The loan is assumable and/or may be subordinated to other debt with HTFC

• approval. If project remains in compliance for POA, loan and regulatory

agreements are satisfied.

• Funds may be used as permanent or construction financing (may be

invoiced for costs incurred during construction). HTFC recommends non- profits have funds available to pay contractors up front while invoicing the HTFC.

Project Assistance

HOME Maximum Subsidy Limits

2017 HOME Maximum Subsidy Limits

Bedrooms All Areas Except NYC, Albany & Buffalo NYC, Albany & Buffalo $58,378 $140,107 1 $66,923 $160,615 2 $81,377 $195,304 3 $105,276 $252,662 4+ $115,560 $277,344

• The maximum amount of HOME funds that can be invested per unit must be

less than the HOME Maximum Subsidy limit (times the number of HOME assisted units) as calculated by HUD in the table below:

• The maximum subsidy limit applies specifically to the number of HOME

assisted units. Not all units must be HOME assisted, but unassisted units may not receive HOME funds or be used to determine the maximum HOME subsidy.

Developer Fee

• All Awardees will execute developer contracts, up to 23% of the total HOME

award provided project passes inspection, is within budget and on schedule.

• Invoiced to HTFC based on following schedule:
• Initial Closing – 10%
• End of demolition – 20%
• Completion of rough carpentry and mechanicals: 20%
• At punch list: 20%
• At final completion of all construction: 20%
• All HOME units rented with IDIS completion reports submitted: 10%

Contract Term

• The contract term is three (3) years, this means full

development, project completion and rent up with the three year timeframe.

• Requests for extensions will be limited or not approved.
• Applicants should request only the amount of funding

that can be expended within the 3 year time frame.

Community Housing Development Organizations (CHDOs)

• The HTFC encourages Developer-owners to certify the project

as CHDO eligible. The requirements set forth in the SRDI Project Management Plan are in compliance with CHDO developer requirements for the use of HOME CHDO set-aside funds.

• CHDOs should contact the HOME Local Program early in the

application process to receive technical assistance regarding the CHDO Certification process. Please send an e-mail to OCRinfo@nyshcr.org to request more information.

• The CHDO must be certified by the HTFC prior to the

commitment of funds, as meeting the CHDO requirements specified in the CHDO definition listed in 2 CFR Part 92.2 and the applicable HUD Notice.

Application Resources

• SRDI Project Management Plan
• SRDI Project Management Plan Questions (update pending)
• SRDI Pro Forma Budget Workbook, Instructions (update pending)
• SRDI CDOL Application Instructions
• HTFC Housing Rehabilitation Standards
• HOME Rent Limits for New York State

Project Management Plan

• The OCR has developed the Small Rental Development Initiative (SRDI)

Project Management Plan that is in compliance with Federal and State HOME regulations and policies.

• The Plan is available on the HCR HOME Program website at

www.nyshcr.org/Funding/SRDI/ and is the manual for how the small rental project must be developed and managed using HOME Local Program funds.

• Policies and procedures contained in the plan must be followed and will

be enforceable along with all aspects of the contract and Federal HOME Investment Partnership Program regulations at 24 CFR Part 92, as may be amended during project implementation.

• HUD requires the HTFC to underwrite the project
• HTFC is liable to re-pay funds if project fails at anytime during the POA.
• Showing long term viability is essential.

Project Management Plan Questions

• Please provide a 1 page summary of your project as applicable: describe

number of units, location, target populations, innovative design features and/or development practices.

• As applicable, describe service provide agreements in place to refer

special needs populations to rent SRDI units.

• Evidence of Market Demand:

Using recent, relevant data from the area where the project is located, demonstrate the need for affordable rental housing of the size and type you are proposing in the local market area, including occupancy levels in comparable projects, waiting lists, and other evidence of demand.

Project Management Plan Questions

• Developer-owner experience and capacity: minimum 1 year in

existence and experience in affordable housing development of similar size and scope projects as proposed in SRDI.

• Project feasibility and readiness
• Long Term Affordability
• Project Plans:

Affirmative Marketing, Tenant Selection, Long Term Management

• Excel Workbook that consists of 6 worksheets (tabs):
• Project Summary
• HOME Limits
• Units & Revenue
• Operating Budget
• 20 Year Operating Projection
• Development Budget
• The budget information contained in these worksheets are necessary to meet

HOME Final Rule underwriting requirements at 24 CFR 92.250(b).

• Applicants should select “fixed” HOME units in the pro forma.
• The development budget tab has a line item for environmental review.

Applicants should propose the expected cost of phased reviews, as applicable for the proposed project.

• The completed Workbook will be a required uploaded attachment to the

Application.

Pro Forma Budget Workbook and Instructions

• The spreadsheets have been constructed to require minimal data

input by the Applicant

• Most cells are auto-calculated based on those inputs.
• Included are instructions for Data Input and Feasibility Testing that

an Applicant should undertake as part of developing the project budget.

• Questions regarding this Workbook and its contents should be

directed to: Alex Smith, Manager of Finance and Compliance at alex.smith@nyshcr.org or by calling (518) 474-2057.

Pro Forma Budget Workbook and Instructions

Project Requirements

• National Environmental Policy Act (NEPA)
• All housing rehabilitation requires weatherization and energy efficiency

measures to be incorporated in the scope of work

• Lead Based Paint Regulations
• Optional: Green Building and Accessibility
• Davis Bacon Related Acts
• MWBE and Section 3 Requirements
• Property & Housing Rehabilitation Standards
• Construction order of priority
• Relocation
• Other project requirements as listed in Project Management Plan

New York State Grants Gateway Prequalification

• The New York State Grants Gateway (“Grants Gateway”) is a statewide effort

that will improve the way New York State administers grants by simplifying and streamlining the grants management process.

• Non-profit organizations must be prequalified in order to do business

with New York State. Non-profit organizations must submit an online Prequalification Application through the “Grants Gateway.” The required forms and document uploads are all part of the Grants Gateway Document

• Vault. Resources to complete the application and associated document vault

can be found in the Quick Links Section of the Grants Gateway page at http://grantsreform.ny.gov/.

• PLEASE NOTE: Applicants that are not prequalified through the New York

State Grants Gateway by the NYS HOME Local Program SRDI application deadline of 3:00pm (EST) on Wednesday, May 10, 2017 will not be eligible to receive NYS HOME Local Program funds, and any applications submitted to the OCR will be deemed ineligible for review and consideration.

Community Development Online System (CDOL) Register to use CDOL

• Review the Community Development Online (CDOL) SRDI

Application System Instructions prior to filling out the online

• application. The instructions also detail the exhibits and

attachments that must be completed and uploaded online.

• Community Development Online (CDOL) is HCR’s online

application system: https://www1.dhcr.state.ny.us/cdonline/menu.aspx

• If your organization has NOT previously applied for funding you

must submit an Application Registration Form available at: http://www.nyshcr.org/Apps/CDOnline/appreg.pdf

The submission of a SRDI application via CDOL requires five steps:

• 1. Completing 5 online application exhibits
• 2. Validating online application exhibits
• 3. Certifying and submitting online application exhibits
• 4. Uploading and submitting attachments
• 5. Certifying attachments.

The application includes five (5) exhibits: Exhibit 1 – Application Summary Exhibit 2 – Program Summary Exhibit 3 – Needs Statement Summary Exhibit 4 – Relevant Experience Exhibit 5 – Budget/Financing Plan And an Electronic Application Certification

The Application includes up to six (6) possible attachments (see additional details in RFP):

• Attachment 1 – Small Rental Development Initiative (SRDI) Project

Management Plan Question Responses

• Attachment 2 – NYS HOME Local Program Budget Worksheet (Required)

N/A (see CDOL SRDI Application Instructions for more details)

• Attachment 3 – Funding Commitment Letters
• Attachment 4 – Pro Forma Budget Work Book (Required)
• Attachment 5 – Site Control Documentation (Required)
• Attachment 6 – Green Building/Energy Efficiency Supporting Documentation
• Attachment 7 – Supportive Services Agency Commitments

Rating Criteria

Based on a 100 point score, the following rating factors and maximum point values will be used to rate and rank the applications:

• Evidence of Market Demand (15 points)
• Developer-owner Experience and Capacity (15 points)
• Persons with Special Needs targeted (10 points)
• Percent below Federal Poverty Level in project Area (5 points)
• Number of persons below Federal Poverty Level in project area (5 points)
• Age of Housing (5 points)
• Project Feasibility (20 points)
• Project Readiness (15 points)
• Tenant Rent Burden & Affordability Index (5 points)
• Green Building and Accessible Units (5 points)

Funding Priorities

• Market Demand
• Feasibility (project and financials)
• Readiness
• Experience and Capacity
• HOME commitment requires fully funded projects. HTFC can commit when

all sources are committed. Preference to fund wholly funded, fully improved projects for 15 to 20 years, no partial improvements.

• Project needs to be financially viable up front, can’t just say “we will get the

dollars and work it out later.”

• Long term good quality management of the rental units is important.

Application Tips

• HUD requires the HTFC to underwrite the project and the HTFC (and

Developer-owner) is liable to re-pay funds if project fails at anytime during the POA. Demonstrating long term viability is essential.

• SRDI Project Management Plan has been stripped down to allow

minimum requirements and the most flexibility. Applicants need to understand and implement the requirements of the plan.

• In regards to underwriting, it must be realistic for local markets and able to

compete.

• SRDI is a single entity initiative in which the non-profit, as the developer

and owner, is highly vested. Minimizes risk for HTFC related to long term financial and rental management.

Application Tips

• Be aware, HOME Rent limits don’t tend to increase too much over

time.

• See the table of contents in the project management plan to

understand overall format.

• Read the entire Project Management Plan before responding to the

Project Management Plan Questions.

• Meet with staff and development team to discuss and determine

how the project will be initially developed and managed during the POA.

• If acquiring for the project, coordinate and/or partner with

municipalities, counties, land banks, lenders for possible properties.

Application Tips

• We understand timeline is short, however RFP was designed to allow for

minimal application submissions.

• Description of Market Need, Pro Forma Budget Workbook and responses

to Project Management Plan Questions are very important to score.

• Operating deficit reserve (ODR) is the 18 month rent up reserve. All

assisted units must be occupied by eligible tenants within 18 months of construction completion or Developer-owner must re-pay funds spent on vacant unit to the HTFC and/or HUD. HTFC may allow developer-owner to retain remaining ODR funds at completion of rent up period.

• The HOME rent limits include utilities, meaning that an allowance for

tenant-paid utilities must be deducted from the published rent limits to determine the maximum contract rent. The Developer-owner must use the HUD Utility Schedule Model (HUSM) to calculate utility schedules and determine the utility allowance.

• No closing of projects with vacant rental units

Application Tips

• Useful life analysis
• Lead Based Paint - Risk Analysis
• Energy Audit, weatherization, energy efficiency measures
• Construction: order of priority for housing rehabilitation
• Capital needs (housing rehabilitation needs during the POA): repair items

now as a part of SRDI project.

• Procurement, bid process, preferred contractor
• Review Project Checklist
• Affirmative Marketing, Tenant Selection and Long Term Management Plans

Technical Assistance

• We can answer all questions through the RFP deadline of May 10,

2017, 3pm.

• The main documents you must be familiar with to submit a

competitive application are the RFP, SRDI Project Management Plan, SRDI Pro Forma Budget Workbook and Instructions and CDOL SRDI Application Instructions.

• All responses to Project Management Plan Questions (14 questions

to respond to in total) are limited to a 1 page maximum, typed in 12 point, Arial font with moderate margins.

• The Pro Forma Budget Workbook must demonstrate financial

feasibility throughout the POA.

Questions & Answers

• If time allows, we will answer general questions applicable to

most applications.

• Please submit all questions on the content of this presentation

to: OCRinfo@nyshcr.org, include HOME SRDI Application in the subject line of your e-mail.

• Specific project related questions will be answered in a Q & A

spreadsheet to be posted on the HCR website

• The non-profit asking the question will not be identified in the

spreadsheet.

SRDI is a new initiative. If you detect errors in the documents, please notify us so we can issue corrections.

PLEASE ASK US YOUR QUESTIONS NOW DON’T WAIT UNTIL MAY 10TH

Thank you!

The NYS HOME Local Program welcomes your applications for SRDI funds to own, develop and manage small rental projects in your local community!

Wrap Up