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Community HOME Investment Program (CHIP)

Community HOME Investment Program (CHIP). Staff. Brian Williamson, Director Community Development and Finance Assistance Division 404 – 679 – 1587 Steed Robinson, Director Office of Community Development 404 - 679 – 3168 Jane Keefe, Affordable Housing Programs Manager

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Community HOME Investment Program (CHIP)

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  1. Community HOME Investment Program (CHIP)

  2. Staff • Brian Williamson, Director Community Development and Finance Assistance Division • 404 – 679 – 1587 • Steed Robinson, Director Office of Community Development 404 - 679 – 3168 • Jane Keefe, Affordable Housing Programs Manager 404 – 679 - 3167 • Kay Garrison, CHIP Consultant 404 – 679 - 0573 • Angela Davis, Grants Management Specialist 404 – 679 - 1591

  3. History of the HOME Program Created by the National Affordable Housing Act • To provide decent affordable housing to lower-income households • Expand the capacity of non-profit housing providers • Strengthen the ability of state and local governments to provide housing • Leverage private-sector partnerships

  4. History of the HOME Program (continued) • HOME funds are allocated by formula to States • DCA used part of its allocation to fund the Community HOME Investment Program (CHIP) - $3 million - $6 million/year • HOME regulations are at 24 CFR Part 92

  5. CHIP Funding to Date • To date, DCA has awarded over $42.4 million in CHIP funding • $ 24.9 million has been expended by local governments on CHIP projects • Other $17.5 million is actively at work today

  6. Eligibility • Eligible Local Government Applicants • Local governments not designated by HUD as Participating Jurisdictions (PJ’s) under the HOME program • Includes jurisdictions not eligible under DCA’s State Administered CDBG Program that are also not HOME PJ’s • List of Ineligible HOME PJ’s follows

  7. Ineligible HOME PJ’s • Albany, Atlanta, Macon, Savannah • Roswell, Marietta • Athens/Clarke County Consolidated Government • Augusta/Richmond County Consolidated Government • Columbus Consolidated Government • Clayton, Cobb, Dekalb, Fulton and Gwinnett Counties

  8. Other Eligibility Requirements • Compliance With State Planning and Financial Reporting Laws • The Georgia Planning Act • The Service Delivery Act (HB 489) • The Local Government Audit Act • DCA Local Government Finance Report

  9. Restrictions on Eligibility • Prior Recipients of CHIP Funding • Resolve outstanding audit/monitoring concerns • Acceptable level of expenditure and performance

  10. Eligible CHIP Activities • Homeowner Rehabilitation • Homebuyer Activities • Rental Housing

  11. Ineligible Activities • Project reserve accounts • Tenant Based Rental Assistance per DCA • Match for other federal programs, except McKinney Act funds • Operations or modernization of public housing • Pre-payment of loan income mortgages under 24 CFR 248 • Double-dipping

  12. Ineligible Activities (continued) • Reimbursement of State Recipient Owned Property • For property used for non-CHIP purpose • For property in its inventory

  13. Ineligible Activities (continued) • Cannot be used for rental assistance if receipt of funds tied to occupancy in a particular project – known as Project Based Rental Assistance • While HOME regulations allow tenant based rental assistance, DCA does not allow tenant assistance as an eligible CHIP activity

  14. Basic HOME Rules • Definition of a Project • Form of Subsidy • Amount of Subsidy • Eligible Costs • The Property • The Applicant or Beneficiary • The Long-term Affordability of Project • Applicability of Other Federal Requirements

  15. Basic HOME Rule – Subsidy Limits • Must have a minimum of $1,000 per project not to exceed: • $102,155 - 0 BR unit • $117,100 - 1 BR unit • $142,395 - 2 BR unit • $184,211 - 3 BR unit • $202,209 - 4 BR unit

  16. Basic HOME Rule – The Property • Property Type (s) • For Homebuyer Activities • Must serve as principal residence • Single-family • Two-to-four-unit property • Cooperative • Mutual housing project if recognized as homeownership by state law • Manufactured home

  17. Basic HOME Rule – The Property • Property Types (s) • For Rehabilitation Activities • Occupied by income eligible homeowner • Must be owner’s principal residence • Includes: • Traditional single-family housing owned in fee simple • A condominium unit • A cooperative unit • Mutual housing • Manufactured home

  18. Basic HOME Rule – The Property • Property Types • For rental activities • One or more buildings on a single site, or multiple sites that are under common ownership, management and financing

  19. Note on Manufactured Housing Activity • Maximum of $5,000 in CHIP for reconstruction, down payment or second mortgage assistance if “used” manufactured housing unit • “Used” manufactured housing unit can be no more than five (5) years old

  20. Note on Manufactured Housing Activity • Maximum of $7,500 in CHIP for reconstruction, down payment or second mortgage assistance if “new” manufactured housing unit • Maximum total funding (both CHIP and other funds) for manufactured housing rehabilitation is $5,000

  21. Basic HOME Rule – The Property • Property Value • Homebuyer -- Cannot exceed $200,160 • Rehabilitation -- Cannot exceed $200,160, after rehabilitation • *Higher limits in MSA’s – See Appendix I in Manual

  22. Basic HOME Rule – The Property • Property Standards • Must meet state and local codes • Must have written rehabilitation standards similar to work specifications and generally describe the method and materials to be used when performing rehabilitation activities • New construction must meet model energy code • Handicapped accessibility, if applicable

  23. Basic HOME Rule – The Property • Property Standards (continued) • Senate Bill 443 for New Single Family • Site and neighborhood standards at 24 CFR 983.6(b) apply only to new construction of rental housing • For manufactured homes: • New manufactured housing must meet the construction and safety standards of 24 CFR 3280 • Must be installed to state and local codes

  24. Basic HOME Rule – The Applicant or Beneficiary • Only for low-income or very low-income families and individuals • Only for those whose annual gross income does not exceed 80% of median by household size • Income limits are published by HUD annually by county • Other targeting required for HOME rental properties

  25. Basic HOME Rule – The Applicant or Beneficiary • Appling County Low Income Limits 1 person2 person3 person $26,000 $29,700 $33,400 4 person5 person6 person $37,100 $40,100 $43,050 7 person8 person $46,050 $49,000

  26. Basic HOME Rule – Long Term Affordability Home Investment Per UnitTerm Less than $15,000 5 years $15,000 - $40,000 10 years More than $40,000 15 years New construction – rental 20 years Refinancing of rental housing 15 years

  27. Basic Home Rule – Application of Other Federal Requirements HOME is subject to a number of other federal requirements

  28. Other DCA Requirements • Historic Preservation • Citizen Participation

  29. General Award Information and Requirements • $3 - $6 million in CHIP for FFY 2008 Maximum award of $300,000

  30. Remember! • Bonus points for CHIP in designated DCA Revitalization Area • ARMs or other variable rate or flexible mortgages reviewed by DCA • DCA-5 and DCA-8 forms to differentiate proposed number of units for manufactured housing units versus stick-built units by activity • DCA-4 to differentiate need for type of housing being proposed (manufactured housing versus stick-built) • Applications to include copy of local governing body resolution • Consider innovative concepts in design for in-fill neighborhoods as a possible “innovation” to gain additional points

  31. Matching Requirements • There are no matching requirements for CHIP • DCA provides the non-federal match

  32. Pre-Award Costs • Pre-award costs are ineligible • Preparation of applications • Cannot be reimbursed if awarded CHIP

  33. Procurement • Applicable to private consultants, engineers, architects • Not applicable to RDC’s/non-profits • Must follow the Common Rule (24 CFR Part 85)

  34. Compliance with Common Rule • Develop a RFP • Indicate level of importance of evaluation factors • Capacity of organization • Current workload of applicant • Applicant’s previous CDBG or CHIP housing experience • Qualifications of key personnel • Level of services provided • Mobility/proximity to project • Cost to perform services • Local government’s experience with applicant

  35. Procurement Process • Publicize the RFP • Allow 30 days for responses • Send letter with RFP to at least 7 known providers • Negotiate with at least 2 respondents • Evaluate proposals and document • Consult with counsel • Gain full council/commission approval • Sole source approval if only one response

  36. Appendix E • Supplemental CHIP Information • Be sure and review this Appendix for helpful hints in making your application more competitive and complete • Requirements for single-family or rental development projects • Lead based paint requirements • Down Payment Notices under URA

  37. Administrative Fees • Maximum of up to 5 percent of CHIP award • Administrative Fee of $15,000 if awarded $300,000 in CHIP

  38. Project Delivery Fees • Up to $2,000 for stick-built rehabilitation or re-construction • Up to $1,000 for stick-built down payment or second mortgage assistance • Up to $750 for manufactured housing rehabilitation • Up to $750 for other manufactured housing with long-term lease • Up to $1,000 for other manufactured housing on land owned by unit owner

  39. Lead Based Paint Project Delivery Fees • $100 per unit for procurement and oversight of lead inspection and/or risk assessment • $300 per unit for procuring and overseeing lead hazard reduction construction work • $100 for procuring and overseeing clearance

  40. Lead Project Delivery Fees • If project administrator is completing lead inspection and/or risk assessment and clearance • $300 PDC to Administrator • Selecting, hiring, and overseeing • Lead construction contract and work

  41. Professional Fees • Primarily for new construction developments • Engineering/Architectural at 7% of construction cost paid for with CHIP • Developer Fee at 10% • Real Estate Fee at 7% • DCA can limit based on scope of engineering/architectural fees

  42. Application Submission • Application due April 1, 2008 • Must be postmarked no later than April 1, 2008 • Or hand delivered by close of business April 1, 2008 • If mailed, use certified or registered mail

  43. Application Submission • Send original and 3 copies • Original photographs in all copies • If combining CDBG and CHIP, submit original and 4 copies

  44. Mailing Address • Mail applications to: Administrative Secretary Office of Community Development Georgia Department of Community Affairs 60 Executive Park South, N.E. Atlanta, Georgia 30329-2231

  45. Mapping • If project is site-specific • If project is in targeted neighborhood DCA-12 Mapping is Required

  46. Resolution • Local Governing Body Resolution Required • Authorizing the CHIP Application • Authorizing person named in resolution to act on behalf of City for CHIP application • DCA-1 must be executed by • Chief elected official or • Person named in resolution to act

  47. Instructions for Completing Application Forms • Application Summary • Must be signed by Chief Elected Official or person authorized in resolution • If site-specific or targeted neighborhood, check on line 19 that Location Map is enclosed

  48. DCA 2 • Proposed Accomplishments • Example Activity MeasureAccomplishments Housing # of housing units 15 Rehabilitation # of persons served 35

  49. DCA 3 Community-Wide Needs Assessment No Longer Required

  50. DCA 4 • Description of Needs to be Addressed • Include documentation supporting type of activity proposed • If also applying for CDBG, a separate description of needs is required for CHIP

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