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Title:
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2018-19 HOME Investment Partnerships Program Call for Interest
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Title
2018-19 HOME Investment Partnerships Program Call for Interest
Description
Request for City Council approval of the Housing Department's Affordable Housing Loan Program (AHLP) Call for Interest (CFI) and Community Priorities for the 2018-19 HOME Investment Partnerships (HOME) Program competitive funding round, and the associated revisions to the AHLP's Underwriting Guidelines. Further request authorization for the City Manager, or designee, to issue the Call for Interest for the 2018-19 HOME Program competitive funding round. There is no impact to the General Fund.
Report
Summary
On Nov. 2, 2016, City Council approved the AHLP's Community Priorities (Priorities) and Underwriting Guidelines that allow the City to be proactive in communicating housing needs to developers of affordable and/or special needs housing. In August 2018, the Housing Department facilitated two feedback sessions with affordable housing developers to solicit input and ideas on improving the CFI process. From these sessions, the Housing Department is recommending changes to the CFI process, evaluation criteria and Underwriting Guidelines. The Housing Department is also recommending that the CFI special needs population definition include households earning 40 percent or less than the Area Median Income (AMI) to better align with the Arizona Department of Housing's Qualified Allocation Plan.
The Priorities for this CFI are:
Acquisition, rehabilitation and/or new construction of properties that focus on homeless or special needs populations and that provide appropriate services to assist and sustain these populations.
Acquisition, rehabilitation and/or new construction of properties where the developer qualifies as a Community Development Housing Organization (CHDO) as defined by the HOME Program.
The total allocation available for the 2018-19 CFI is approximately $4.9 million in HOME funding, of which $620,000 must be awarded to CHDOs. The remaining funds will allow for an estimated four to five affordable housing project awards with a maximum award of $1 million.
Procurement Information
The CFI will be available through the City's website in November 2018. A selection committee will convene to evaluate proposed projects for the CFI-identified Priorities, based on the criteria below. The committee will be made up of representatives from City departments and community partners with housing development expertise who are not competing for the funding. Formal recommendation for the CFI award(s) will be presented to the Planning and Economic Development Subcommittee and City Council for approval.
This year, applicants must meet the following threshold criteria prior to moving forward to evaluation and scoring by the selection committee.
Threshold Criteria:
Application submitted before deadline.
Development team is not on the HUD Debarment List.
Compliance with existing city loans.
Complete Application as specified in the CFI.
Those applications that do not meet the threshold criteria will be rejected and not move forward to evaluation.
Evaluation criteria for selection will include the following:
Developer Experience (130 pts) - Capacity and prior experience of the organization; its staff member and consultant experience in planning and completing projects similar to the proposed project; and property management experience of those who will manage the proposed property, including compliance with federally-subsidized units.
Project Merits (215 pts) - Project need, proximity to services; sustainability as demonstrated in energy efficient design; location near transportation; amenities included in the project design; site plans and elevations; accessibility; experience of the General Contractor; and project readiness and timeline.
Financial Feasibility (130 pts) - Includes development financing plan; funding commitments; mitigation of identified risks; and leverage of City funds.
Project Impact (25 pts) - How likely the project is to succeed and accomplish its goals; serve the intended population; and demonstration of financial feasibility and project readiness.
Underwriting Guidelines Revisions:
The City first adopted the Underwriting Guidelines (Guidelines) in October 2005. Since then the Guidelines have been periodically updated to reflect current City priorities, federal funding regulations and changes in lending practices. The Guidelines were last updated in October 2016. The goals of the Guidelines are to:
Provide long-term housing affordability.
Outline clear guidelines for quality, well-constructed or rehabilitated housing.
Create predictable, clear underwriting and approval process.
Manage risk and encourage high performing projects.
Proposed revisions to the Guidelines include the following:
Revised special needs population to include households earning 40 percent or less than the AMI.
Revised threshold and evaluation criteria to coincide with the above requirements.
Financial Impact
There is no impact to the General Fund. HOME is a federally-funded program.
Concurrence/Previous Council Action
This item was heard at the Planning and Economic Development Subcommittee on Nov. 6, 2018, and recommended for approval by a vote of 4-0.
Department
Responsible Department
This item is submitted by Deputy City Manager Deanna Jonovich and the Housing Department.