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Mind the Gap: Where to Find Gap Funding

Mind the Gap: Where to Find Gap Funding. LIHTC Conference September 5, 2013 Shea Hollifield Department of Housing and Community Development. Know Your Gap. Only ask for what is needed to fill the REAL gap Do not low ball your request - $343,129 Do not inflate costs with unnecessary extras

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Mind the Gap: Where to Find Gap Funding

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  1. Mind the Gap: Where to Find Gap Funding LIHTC Conference September 5, 2013 Shea Hollifield Department of Housing and Community Development

  2. Know Your Gap • Only ask for what is needed to fill the REAL gap • Do not low ball your request - $343,129 • Do not inflate costs with unnecessary extras • Do not replace other funding sources • Participate in the risk – developer’s fee etc. • Match project objectives to funder’s objectives

  3. DHCD Gap Funding Resources • Virginia Housing Trust Fund – competitive loans • HOME Investment Partnership funds – HUD funds for nonentitlement areas

  4. Virginia Housing Trust Fund • It takes a village to pass a Trust Fund $7 million in 2012 General Assembly $1 million in 2013 General Assembly $8 million Virginia Housing Trust Fund At least 80% to loans Up to 20% for grants

  5. Housing Trust Fund Categories

  6. HTF Competitive Loans • Loans for affordable rental housing and homeownership • Alignment with state housing policies, leveraging, long-term affordability, sustainability • Rate and terms determined through underwriting process

  7. Housing Trust Fund Status • 26 foreclosure counseling grants made in conjunction with VHDA’s housing counseling grant process • 5 foreclosure rehabilitation grant applications approved – Trust Stabilization Program (TSP) • 29 competitive loan applications pending • 58 homeless reduction applications pending announcement

  8. Housing Trust Fund Status • Funds allocated only for FY 2014 • Future allocations dependent upon funding from the General Assembly

  9. HOME Investment Partnership • Federal funds from HUD for a range of affordable housing uses • Virginia’s state HOME program: -Affordable and Special Needs Housing -Down payment assistance -Indoor plumbing and rehabilitation – homeowner rehabilitation

  10. HOME funding – Virginia Program

  11. HOME – Affordable and Special Needs Housing • Competitive quarterly application process • Typically used as gap financing • Structured as interest-only loans at 3% for 15 to 20 years. Principal due at end of affordability period. Can enter into an extended compliance period for principal forgiveness at end of term

  12. HOME – Affordable and Special Needs Housing • Funds decreasing • Increasingly competitive application process • Priority given to: -Projects in nonentitlement areas -Community Housing Development Organization(CHDO) projects -Exceeding 504 requirement -Green building approaches

  13. Shea Hollifield Department of Housing Community Development 804-371-7031 shea.hollifield@dhcd.virginia.gov

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