FY 2010 Section 202 & Section 811

1. FY 2010Section 202 & Section 811 Capital Advance Programs

2. Basic Program Requirements

3. Purpose To expand the supply of supportive housing for the very low-income elderly (202) and for very low-income persons with disabilities (811). Section 202: 62 years of age or older, including frail elderly. Section 811: 18 yrs old & over with one or more of the following: • Chronic Mental Illness • Physical Disability • Developmental Disability

4. Types of Funds Capital Advance (CA): • Must be used for.. • new construction or rehabilitation of a structure; or • acquisition of a structure with or without rehabilitation. • Repayment is not required as long as the project remains available for occupancy by eligible program residents for at least 40 years.

5. Types of Funds Project Rental Assistance Contract (PRAC): • Covers the difference between • Tenant’s contribution and • HUD-approved operating expenses. • Initial term is 3 yrs

6. Types of Funds Project Rental Assistance Contract, (PRAC): • Provide Supportive Services(SS) • Section 202 – frail & at risk elderly: • up to $15 per unit/per month • hire a service coordinator(sc) if at least 25% of residents are frail and/or at risk Note: funding for SS will not be made available until project is occupied and Owner identifies the frailty or at risk nature of residents • Section 811: from outside sources.

7. FY 2010 Appropriations • Section 202 • $825,000,000 • $371 million CA for 2,731 new units • $90 million for Service Coordinator & CHSP • $40 million for ALCP • $20 million for Section 202 Demonstration Pre-Development Grant Program

8. FY 2010 Appropriations • Section 811 • $300,000,000 • $ 114 million new CA and PRAC funds • $87.1 million tenant-based assistance • $34 million CA/PRAC amendments (Devel) • $48 million PRAC renewals/amends (AM)

9. Section 202/811 Allocations Expiration of Funds… Obligation: All FY10 202/811 funds must be obligated by September 30, 2013. Disbursement: CA funds – September 30, 2018. PRAC Funds - September 30, 2023.

10. Independent Apartment Units Efficiencies & 1 Bedrooms for residents only Up to a 2-Bedroom limited to a res. manager, if proposed Group Homes are ineligible Eligible Structure Types(Section 202 Only)

11. Eligible Structure Types (Section 811 Only) • Independent Living Projects (ILPs) • containing individual apt. units • 3 & 4 bedrooms restricted to families (NOT unrelated individuals) • Up to a 2-bedroom unit for a resident • manager, if proposed

12. Eligible Structure Types (Sec. 811 Only) Group Homes • Minimum 2 residents and maximum 6 residents allowed • 1 Bedroom unit for res. mgr. permitted • 2 GHs cannot be located next to each other

13. What makes a 202/811 Project a mixed finance project? • Secondary Financing • Low Income Housing Tax Credits • An Owner Entity that • Is a For Profit Limited Partnership and • Has a non-profit organization wholly owned and controlled by a sole General Partner (GP) • Additional non assisted units • All of the above

14. Mixed Finance Project • Additional unassisted unit-allow not mandatory • Use of the following tax credit programs likely not mandatory • Low Income Housing Tax Credit (LIHTC) • Historic Preservation Credits • State Finance Affordable Housing Tax Credit

15. Mixed Financing To learn more about this program contact By email: Kerry.J.Mulholland@hud.gov Or by phone: 202-402-2649

16. Ineligible ActivitiesSections 202 and 811 • Nursing homes; • Infirmaries; • Medical facilities; • Mobile Homes; • Community centers; and/or • Project licensed or to be licensed as assisted living facilities;

17. Ineligible Activities Section 202 and 811 • Refinancing of Sponsor-owned facilities without rehabilitation; and/or • Headquarters for organizations for the elderly or persons with disabilities.

18. Ineligible Activities Section 202 only • Residential units without kitchen and/or bathrooms; and • Housing that you currently own or lease that is occupied by elderly persons.

19. Ineligible Activities Section 811 Only • Supportive Services; and • Housing that you currently own or lease that has been occupied by persons with disabilities for longer than one year prior to the application deadline date.

20. Changes Are Designed to…. • Facilitate the development of larger projects by reducing the geographic allocation areas from 51 areas to the 18 areas representing the Multifamily Hubs. Section 202/811 Allocations • Please refer to the Program NOFA for the approximate dollar amount that was allocated to each Hub Office

21. Changes Are Designed to…. • Promote the selection of projects that are “ready to proceed” by restructuring the awarding of points to favor such a selection.

22. Changes Are Designed to…. • Change selection criteria to emphasize Sponsor’s housing development experience. • Promote diversity in the selection of sites by allowing risk-based corrective actions in the clean-up of contaminated sites. • Detailed discussion to be provided in part III of this broadcast.

23. Changes Are Designed to…. • Encourage the development of housing in livable communities by strengthening the criteria for evaluating the proximity or accessibility of the site to services and amenities. • Provide higher points for acceptable green standard. • Up to 4 policy priority points

24. Changes Are Designed to…. Require energy efficiency measures • Single family and multifamily developments (up to 3 stories) must meet EPA’s Energy Star Qualified Homes. The requirements are found at • http://www.energystar.gov/index.cfm?c=bldrs_lenders_raters.pt_bldr • Email questions to energystarhomes@energystar.gov

25. Changes Are Designed to…. Require energy efficiency measures • Mid-rise and high-rise must meet a performance target of 15% better than ASHRAE 90.1-2007 as defined by Appendix G • Visit www.ashrae.org • Pre & post construction energy audit required for existing developments and incorporate conservation techniques (not involving gut rehab) Any state energy code requirements exceeding ASHRAE or Energy Star will take precedence

26. Changes Are Designed to…. Require water conservation measures • Water-conserving fixtures are required • www.epa.gov/owm/water-efficiency

27. Changes Are Designed to…. Incorporate energy efficiency and water conservation measures in the operation of all projects. If selected for funding, you required to: • Commit to future installation of water-conserving fixtures and ENERGY STAR appliances. • Develop an Operation and Maintenance (O&M) manual • O&M templates can be found on Enterprise Green Communities’ website • http://www.practitionerresources.org/documents.html?c=320

28. Incorporating Energy Efficiency & Green Concepts • Recent HUD & EPA collaboration PDR Report : “Enhancing Energy Efficiency and Green Building Design in Section 202 and Section 811 Programs” • Download report from: http://www.huduser.org/portal/publications/affhsg/enh_eng_eff_gbd.html • This report serves as a roadmap for sponsors/owners who are working to invest in conservation and green features that will make the Section 202 and Section 811 portfolios more efficient and sustainable over time.

29. Exhibit Changes Section202 and 811 Exhibit 3 3(b) • Description of community ties, both housing and non-housing related services • See exhibit for other submission requirements 3(c) • Funding commitment must be included. • Land donations must include appraisal or tax assessment to document value

30. Exhibit Changes Section202 and 811 Exhibit 3 3(d) • Letters from organizations committing services • If you have entered into an MOU, • It must be signed by persons with authority, • See NOFA for MOU requirements

31. Exhibit Changes Section202 and 811 Exhibit 3 3(e) • Description of housing andservices experience for both sponsor and co-sponsor. • Provide a listing of all rental housing projects within the last 5 years • See NOFA for required information

32. Exhibit Changes Section202 and 811 Exhibit 3 3(i) • Job Creation/Employment Policy Priority • Describe how you will exceed Section 3 requirements • Refer to General Section for detailed discussion

33. Exhibit Changes Section202 and 811 Exhibit 4 4(a) • Describe category of elderly persons intended to serve (202 only) • Conduct a Rental Housing Survey and submit findings • See NOFA for survey requirements and website resources

34. Exhibit Changes Section202 and 811 Exhibit 4 4(c)(iii) • If schematic plans and outline specs completed • Submit a letter from licensed architect. See NOFA for further discussion • If non capital advance permanent financing committed • Submit detail budget. See NOFA for further discussion

35. Exhibit Changes Section202 and 811 Exhibit 4 4(d)(iii) • Evidence status regarding compliance with local zoning and land use regulations • Evidence access to public utilities

36. Exhibit Changes Section202 and 811 Exhibit 8 Must submit form 2530, Previous Participation Certification with application • Ensure high standards and minimize risk of loss to Department • Must be approved to be eligible for selection

37. Rating Factor Changes Section202 and 811 Rating Factor 1 – Capacity 1(a) • 10 points for housing experience • to earn max. points must have developed and owned housing as complex as what is being proposed • 5 points for supportive services experience

38. Rating Factor Changes Section202 and 811 Rating Factor 2(a) – Need • Point range and ratio values have been expanded (refer to NOFAs for complete details). • 202: 10 points max • 811: 5 points max • Public Use Microdata Area (PUMA) used for determination • PUMA Link available for use by Housing staff to evaluate http://www.huduser.org/PUMA/puma.html

39. Rating Factor Changes Section202 and 811 Rating Factor 3 – Soundness of Approach 3(a) • Strong emphasis on livable communities • transit-served locations: 7 pts-202, 5 pts-811 • Reliable and accessible public transportation by private shuttle/van service and/or • Conveniently located transit stops • amenity-served locations: 8 pts-202, 5pts-811 • Must be within one-half mile • Must provide map and photos identifying each amenity Refer to NOFA for detailed breakdown of points

40. Rating Factor Changes Section202 and 811 Rating Factor 3 – Soundness of Approach Section 202- 3(f) • To receive the maximum of 4 points you must submit MOU between you and the agencies committing services

41. Rating Factor Changes Section202 and 811 Rating Factor 3 – Soundness of Approach Green Development 202- 3(j) 811- 3(i) • Firmly commit to fully utilizing one of the recognized green building standards • Refer to General Section of NOFA under the Sustainability Policy Priority for additional details • 4 Policy Priority points • 0 points if plan does not evidence understanding of necessary process to build to the identified standard If successful, certification is required

42. Rating Factor Changes Section202 and 811 Rating Factor 3 – Soundness of Approach Readiness 202- 3(k)(1) 811- 3(j)(1) • 6 points - have all discretionary approvals including design review • 4 points - have all discretionary approvals excluding design review • 2 points just zoning but require other discretionary approvals

43. Rating Factor Changes Section202 and 811 Rating Factor 3 – Soundness of Approach Readiness 202- 3(k)(2) 811- 3(j)(2) • 2 points – letter from architect 202- 3(k)(3) 811- 3(j)(3) • 2 points – detailed budget 202- 3(k)(4) 811 3(j)(4) • 1 point – will serve letters 202- 3(k)(5) 811 3(j)(5) • Deduct 2 points if obvious adverse environmental conditions and mitigation is not achievable within 6 months of fund reservation date

44. Rating Factor Changes Section202 and 811 Rating Factor 3 – Soundness of Approach Job Creation/Employment 202- 3(m) 811- 3(k) • 1 point • Activities must be more comprehensive than Section 3 • Further discussion in Part II of this broadcast • Refer to NOFA for description requirements

45. Rating Factor Changes Section 202 and 811 Rating Factor 4 –Leveraging • Increased to a maximum of 6 points • Awarding of points strictly based on written evidence of firm commitment towards the development of project

46. Changes Applicable to Both Section 202 and 811 • The Development Cost Limits have been increased as follows:

47. Changes Applicable to 202 Development Cost Limits for Non-elevator structures: $51,739 per family unit without a bedroom; $59,655 per family w/ 1 bedroom; $71,944 per family w/ 2 bedrooms.

48. Changes Applicable to 202 Development Cost Limits for Elevator structures: $54,448 per family unit without a bedroom; $62,415 per family w/ 1 bedroom; $75,897 per family w/ 2 bedrooms.

49. Changes Applicable to 811 Sub rating factor 3h requires applicant to address extent of project viability for 40-year capital advance. Increased to 4 points maximum

50. Development Cost Limits for Non-elevator structures: $ 51,739 per family unit without a bedroom; $ 59,655 per family w/ 1 bedroom; $ 71,944 per family w/ 2 bedrooms $ 92,091 per family w/3 bedrooms $102,593 per family w/4 bedrooms Changes Applicable to 811