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Changes to HOME Rule

Changes to HOME Rule. Housing Summit 2014 Dan Puccetti, Laurie LindenDill and Debbie Davis, Presenters. Today’s Agenda. HOME Program Background Housing Development and HOME CHDO Set Aside and CHDO Operating HOME Rehab changes HOME Homeownership changes Other HOME changes

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Changes to HOME Rule

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  1. Changes to HOME Rule Housing Summit 2014 Dan Puccetti, Laurie LindenDill and Debbie Davis, Presenters

  2. Today’s Agenda HOME Program Background Housing Development and HOME CHDO Set Aside and CHDO Operating HOME Rehab changes HOME Homeownership changes Other HOME changes HOME related activities

  3. HOME Program Background Created by the National Affordable Housing Act of 1990 (NAHA) & most recently amended August 23, 2013 MFA receives funds annually from HUD $3.8 MM in 2014, down 50% from 2010 Allocated to various MFA departments See HUD’s website for more detail https://www.onecpd.info/home/home-final-rule

  4. Housing Development (HD) HOME used throughout New Mexico, except Albuquerque & Las Cruces Awards made throughout the year, on a first come, first served basis HD works only with developers and, at this time, offers only a rental program HOME units must be occupied by families earning at or below 60% AMI

  5. Housing Development (HD) HOME provides “gap” financing to enhance affordability of rental projects MFA limits are more restrictive than HUD to better allocate a scarce resource Most HOME awards are structured as long term low-interest rate loans but may be forgivable if 30% AMI families are served

  6. Housing Development (HD) Max HOME with 9% LIHTC $400K for CHDOs or $600K for non-CHDOs Max HOME with 4% or no LIHTC $600K for CHDOs or $800K for non-CHDOs Subject to per unit limits and not to exceed 80% of total development cost (see http://www.housingnm.org/home-rental-loan-program) Projects must be inspected at completion

  7. CHDOs & Set-Aside Community Housing Development Organizations (CHDOs) are designated by MFA, eligible to apply for Set-Aside and Operating Funds CHDO Set-Aside – 15% of HOME funds are for housing development investments by qualified CHDO’s acting as owners, developers, or sponsors of the housing (i.e. must create housing)

  8. CHDO Operating Funds Operating: CHDOs may apply for $40K in operating funds ($50K in new service area) with CHDO Set-Aside award & recertification (must apply for all at the same time) May only receive one operating award annually. See website for more detail: http://www.housingnm.org/community-housing-development-organizations-chdo

  9. Owner-Occupied Rehab Projects and requests for reimbursements uploaded to Secure Data Transfer site Project timeline expanded to 180 days Still no guidance from HUD on UPCS for rehab (property inspections)

  10. Owner-Occupied Rehab • Additional oversight by MFA to include: • Comparison of cost estimate to actual charges • Payment of final invoice contingent upon 3rd party inspection beginning 2015 • New financial audit requirements for FY2014 • Certified Auditor that is on State Auditor’s List http://www.saonm.org/approved_audit_firms and • Auditing firm must be procured a minimum of every 3 years

  11. Other Changes • Added new eligible forms of homeownership: • Added community trust land • Manufactured housing on ground lease at least equal to affordability • UPCS – uniform national standards, adopted for HOME rehabilitation, acquisition, and tenant-based rental assistance (effective January 24, 2015)

  12. Other Changes • Income Determinations • PJs must examine at least 2 months of source documentation • PJs must count the income of all persons in the household, including nonrelated individuals • Project Completion Deadline – 4 years from date written agreement executed or PJ must repay HOME funds

  13. Other Changes • PJs can charge compliance monitoring fees for projects where HOME funds committed on or after August 23, 2013 • Must be included as cost of project as part of project underwriting • Must be based on average actual cost of monitoring HOME-assisted rental property • All HOME-assisted homebuyers must receive housing counseling

  14. Other changes Requires underwriting of all HOME projects (rental and homebuyer) whether or not projects are assisted with other governmental assistance PJs are required to establish utility allowances and to update annually PJs must convert homebuyer units to rental if not sold within 9 months of completion of construction or rehabilitation

  15. More others Affirmative marketing procedures are extended to all HOME funded programs, including DPA, i.e., market the program, not the units PJs must inspect each project before releasing funding

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