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CDBG Applicant’s Workshop Housing Session

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CDBG Applicant’s Workshop Housing Session

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  1. CDBG Applicant’s WorkshopHousing Session

  2. CDBG Housing • Types of Grants • Single Activity: • Housing Activities Only • Multi-Activity: • Housing PLUS Infrastructure Activities CDBG APP Housing Presentation

  3. CDBG Housing • Assessing Needs • What are the needs community wide? • Are there concentrations of substandard housing? • Determine the project area (TARGET AREA) CDBG APP Housing Presentation

  4. Single Activity • Only Addresses Housing Activities • May Include Several Activities • Rehabilitation • Reconstruction • Acquisition • Relocation • Demolition CDBG APP Housing Presentation

  5. Single Activity • Limit of $500,000. • May be City/County Wide, Target Area, Targeted to a Specific Group • Elderly • Handicapped • Working Families with Children CDBG APP Housing Presentation

  6. Eligible Activities CDBG Single Activity HousingMaximum $500,000. • Rehabilitation – Of substandard housing • Reconstruction – Where Unfeasible to Rehab CDBG APP Housing Presentation

  7. Eligible Activities CDBG Single Activity HousingMaximum $500,000. • Acquisition - of Real Property • Disposition – Costs Incidental to Disposing of Property Acquired with CDBG Funds • Code Enforcement CDBG APP Housing Presentation

  8. Eligible Activities CDBG Single Activity HousingMaximum $500,000. • Clearance – Of Dilapidated Structures, out-buildings, and Other Items • Interim Assistance • Relocation – Temporary or Permanent • Removal of Architectural Barriers CDBG APP Housing Presentation

  9. Eligible Activities CDBG Single Activity HousingMaximum $500,000. • Home Ownership Assistance • Down Payment • Closing costs NOTE: DCA policy mandates use of fixed rate mortgages on all CDBG funded projects CDBG APP Housing Presentation

  10. Eligible Activities CDBG Single Activity HousingMaximum $500,000. NOTE: New Construction is NOTeligible unless as “last resort” OR approved Community Based Development Organization is used. CDBG APP Housing Presentation

  11. Eligible ActivitiesRevitalization Area Strategy Maximum $800,000. • Officially adopt a local Redevelopment Plan in accordance with the Urban Redevelopment Act O.C.G.A. 36-61 • Eligible area of Census Block Group(s) of 20% or greater poverty level. • Develop strong local partnerships focusing local resources within the Revitalization Area. • Submit application for designation to DCA. • Must be designated by DCA through application CDBG APP Housing Presentation

  12. CDBG HousingApplication Review Process • Application Read and Reviewed by the Housing Panel • Rank and Score based on: • Feasibility of Project • Strategy Proposed • Impact of Project CDBG APP Housing Presentation

  13. Feasibility Considerations • Property Standards • Outside Services and Resources • Lead Based Paint • Funding Sources and Commitments • Operation Oversight • Maps and Overview • Selling Your Project • Costs CDBG APP Housing Presentation

  14. Minimum Property Standards • Realistic Minimum Property Standards – you determine what standards you want in your community. • Property Standards and Construction Standards. • Code Violations and Incipient Violations. • First priority should be given to Health, Safety, and ADA compliance. CDBG APP Housing Presentation

  15. Outside Services and Resources • Identify service required and what service will be rendered. • Establish estimated cost. • Procure a FIRM commitment letter specifying on-going services on a cost-per-hour or per project basis. CDBG APP Housing Presentation

  16. Lead Based Paint (LBP) • LBP evaluation is required on any structure built before 1978. • Evaluation services must be performed by an inspector/risk assessor licensed and certified by the state. • Lead hazard control work rules are changing – See the EPA Renovation and Remodeling Final Rule (EPA RRP Rule) • Stay Tuned for EPD Presentation!! • Lead hazard control can be costly, budget 25% of estimated rehab cost. • Be prepared to seek services outside your local area. Consider travel and other expenses when preparing your estimate. CDBG APP Housing Presentation

  17. Funding, Partnerships, Other Resources. • Obtain FIRM commitment letters from all parties. • Ensure that the commitment letters are issued and signed by authorized individuals. • Pledges of support without commitment letters will not be considered. • Indicate how each will be applied, at what point will these funds be released. • Owner contributions if required. • General Property Improvements (GPI) are not funded by CDBG. • Secure firm, convincing documentation of participation from investor-owners. CDBG APP Housing Presentation

  18. Schedules and Time tables • Who will provide oversight? • Develop and show a schedule of start and completion dates. Indicate milestones and inspection points. CDBG APP Housing Presentation

  19. Contracting and Construction • Very problematic area. • Qualifying contractors: guidelines and criteria. • “Pre-Bids” and “Scope of Work”. • Bidding process and bid acceptance protocol. • Contract negotiations. • Change Orders protocol. • Draw Request and approval process. CDBG APP Housing Presentation

  20. Maps and Photos • DCA Form 12 spells out what is required on map. • Prefer map to be in common scale. • Show details: existing structures, street names, subject area(s), schools, etc. • Must include key to photographs. • Indicate status of structure (e.g. occupied, vacant, absentee owner/rental, non-targeted structure. • Indicate rehab or reconstruction. • INCLUDE FINANCIAL PLAN FORM (EXHIBIT H) CDBG APP Housing Presentation

  21. CDBG APP Housing Presentation

  22. Maps and Photos (cont.) • Photographs. • Show all 4 elevations if possible. • Interior photos should clearly represent condition of structure and problems described in narrative. • Photographs of the owner, his or her family, children, in-laws, family pets, automobiles, etc. are not required. CDBG APP Housing Presentation

  23. Unit # 10 Roof Leak CDBG APP Housing Presentation

  24. Unit #10 Roof Leak Damage CDBG APP Housing Presentation

  25. Selling it to DCA • Exactly WHAT this project will achieve. • Exactly WHY do you need this project. • Exactly WHO will the project impact. • Exactly HOW you will accomplish the project. • Exactly WHERE the target area(s) are located. • DATA, we love data! • BE SPECIFIC! CDBG APP Housing Presentation

  26. Feasibility Considerations(Lead Based Paint) • Lead-Based Paint • Regulation Applies to all Housing Built Prior to 1978 • Demonstrate understanding of regulation requirements CDBG APP Housing Presentation

  27. Feasibility Considerations • Financing Technique(s) BE SPECIFIC • Deferred Payment Loans • Leveraged Loans/Interest Buy Downs • Who are your partners • Include participation formula • Know your community! Be realistic with participation formula CDBG APP Housing Presentation

  28. Feasibility Considerations • Confirmation of proposed resources and partners • Compliance with Applicable Laws • Investor Owner Eligibility • Financing: 50%, DPL at full term. • Rent Regulatory Agreement • Timetable for proposed accomplishments CDBG APP Housing Presentation

  29. Feasibility Considerations • Unit by unit analysis of proposed activity • Include per unit cost estimate • Include description of proposed work needed with pictures illustrating problems (exterior and interior) • Complete “Financial Plan” Form (Appendix H) • Descriptive map of all units targeted CDBG APP Housing Presentation

  30. Strategy Considerations • Describe Severity of problems • Demonstrate needs in narrative AND with Pictures • Alternatives to Strategy • Discuss other possible strategies and why the strategy proposed is best for problems described CDBG APP Housing Presentation

  31. Strategy Considerations • Discuss plan to prevent re-occurrence of problems addressed in grant proposal • Adoption of policies or ordinances • Code enforcement • Ongoing maintenance CDBG APP Housing Presentation

  32. Strategy Considerations • Marketing of Program • Who has expressed interest in Program? • How will Interested be generated? • Are residents supportive of the program? • Document Commitment from Owner Occupants and Investor Owners! CDBG APP Housing Presentation

  33. Impact Considerations • Impact Of Project • Document severity of need • Describe the effect the proposed project will have on the identified needs as well as the community as a whole • How many persons will benefit • Overall CDBG Cost per person CDBG APP Housing Presentation

  34. Successful Strategies Owner Financial Participation Percent of Rehab Cost: • Required participation is fixed amount according to their income level: “Participants below 30% AMI will be required to pay $500 towards of the cost of their rehab” “Participants between 30% and 50% AMI will be required to pay $1000 towards of the cost of their rehab” CDBG APP Housing Presentation

  35. Successful StrategiesFinancial Participation • Percent of Income: • Required participation is fixed percentage of Annual Income “Participants will be required to pay 8% of their annual income” • Annual Income = $9,000 • Required Participation = $720 CDBG APP Housing Presentation

  36. Successful StrategiesFinancial Participation - Percent of Income Percent of Income (cont.): “Participants will be required to pay 8% of their annual income multiplied by the term of the DPL” • Annual Income = $9,000 • 8% of Annual Income = $720 • X 5 (length in years of DPL)=$3,600 CDBG APP Housing Presentation

  37. Successful StrategiesFinancial Participation - Percent of Income Add a sliding scale of income to percent of income… Required participation is a fixed percentage of income based on income level: “Participants whose income is below 30% of AMI are required to pay 3% of their annual income…” CDBG APP Housing Presentation

  38. Successful StrategiesFinancial Participation - Percent of Income …for higher income level: “…Participants whose income is between 30% and 50% of AMI are required to pay 6% of their annual income…” CDBG APP Housing Presentation

  39. Successful StrategiesFinancial Participation - Percent of Income …for highest income level: “…Participants whose income is between 50% and 80% of AMI are required to pay 9% of their income…” CDBG APP Housing Presentation

  40. Successful Strategies • Mandatory Homebuyer Counseling • Credit Counseling • Employment training • Holistic approach to neighborhood revitalization • Address people problems along with housing/infrastructure problems CDBG APP Housing Presentation

  41. Compliance with Regulations • Acquisition • Easements for Public Facility Improvements • Dilapidated Units • Uniform Relocation Act (URA) CDBG APP Housing Presentation

  42. Compliance with Regulations • Relocation – Permanent • Uniform Relocation Act (42 months) • Owner OR Tenant • 104(d) “Barney Frank” (60 Months) • Tenant Only (Rent to Rent) • One for One Replacement CDBG APP Housing Presentation

  43. Compliance with Regulations • Identify Available Resources • Comparable Units • Provide Basis for Relocation • Current v. available rents CDBG APP Housing Presentation

  44. Compliance with Regulations Reconstruction • Replacement of Dilapidated Unit on SAME parcel when existing unit is not feasible for rehabilitation • Owner Occupied ONLY CDBG APP Housing Presentation

  45. Compliance with Regulations New Construction Eligibility • Last Resort • No Available Resources Exist • Cost exceeds allowable limits • Application must provide credible evidence • Cheaper to build (including parcel) than purchase • Not-for-profit or for-profit developer • Approved Community-Based Development Organization CDBG APP Housing Presentation

  46. Do’s • Provide a Unit by Unit Analysis • Keyed to Map • Picture(s) of Units (Exterior and Interior) • List of Deficiencies for Targeted Units • Provide Cost Estimates CDBG APP Housing Presentation

  47. Do’s Cost Estimates: • Provide estimates based on complete walk through • Keep in Mind that Actual work may be 1 or 2 years away….Budget Appropriately • Budget for Lead Hazard Control • Program will pay all LBP Costs CDBG APP Housing Presentation

  48. Do’s • For Target Area’s: • Provide Target Area Data: • Total Number of Units • Total Number of Substandard • Total Number of Dilapidated CDBG APP Housing Presentation

  49. Do’s • For Target Area’s: • Provide Target Area Data: • Total Number of Owner Occupied • Total Number of Renter Occupied • Total Number of Vacant • Describe use where possible (rental, heir property, dilapidated, etc) CDBG APP Housing Presentation

  50. Do’s • For City/County Wide Programs • Describe how units were chosen in a fair and equitable manner • Provide description of overall housing conditions jurisdiction wide • Overall assessment of need for Housing improvements and justification for the chosen units CDBG APP Housing Presentation