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Permanent Supportive Housing with Project Based Voucher Assistance

Permanent Supportive Housing with Project Based Voucher Assistance. June 13, 2008. QAP Mechanisms to Create Permanent Supportive Housing. Permanent Supportive Housing Set-Aside 25% of the State’s total credit ceiling Non-statutory May be eligible for PBV assistance

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Permanent Supportive Housing with Project Based Voucher Assistance

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  1. Permanent Supportive Housing with Project Based Voucher Assistance June 13, 2008

  2. QAP Mechanisms to Create Permanent Supportive Housing • Permanent Supportive Housing Set-Aside • 25% of the State’s total credit ceiling • Non-statutory • May be eligible for PBV assistance • Ten percent (10%) Supportive Housing Requirement • All LIHTC project will be required to target 10% of the total units to Supportive Housing Tenants • Excludes tax-exempt bonds • May be eligible for PBV assistance

  3. Supportive Housing Set-AsideGeneral Application Information • Non-eligible Populations – Elderly only projects are excluded • Populations Served – Minimum 35% of the units targeted to supportive housing initiatives. Additional points for having more than 75% supportive housing units. (See definitions outlined in Addendum IIIa, Attachment A)

  4. Supportive Housing Set AsideGeneral Application Information cont. • Project size – Not exceed 75 units under the Supportive Housing set-aside. • Service Organization Collaboration –Assuring adequate service coordination and delivery for tenants. • Site Selection – See Tab C under the Combined Application for MSHDA’s Site Selection Criteria.

  5. Supportive Housing Set-AsideThreshold Requirements • Addendum IIIa Application – Only supportive housing proposals under the Set-Aside are required to submit Addendum IIIa. • Letters of Support – From Continuum of Care or community group, endorsing project, and from service provider’s funder(s) if applicable.

  6. Supportive Housing Set-AsideThreshold Requirements cont. • Memorandum of Understanding(MOU) – Agreement between owner, service provider, and the property manager. • Service Coordination Plan – On site service coordination must be available to all supportive housing tenants. Minimum schedule standard recommended: • One day per week – 30 units or less • Two days per week – 30-60 units • Three days per week – 60-75 units

  7. Supportive Housing Set-AsideThreshold Requirements cont. • Additional Threshold Requirements: See Section VIII-A of the Qualified Allocation Plan (QAP) for additional requirements which must be followed. For SH Set-Aside proposals, the Inclusion Plan, Item #1, is not required. • Scoring and Ranking – Set-aside proposals will be scored under Addendum IIIa, not under Addendum I. See Scoring Summary, Attachment C under Addendum IIIa.

  8. (10%) Supportive HousingThreshold Requirement • 10% Requirement: All projects with allocated tax credits (excluding elderly projects and projects using tax-exempt bond financing) will be required to target ten percent (10%) of the total units to Supportive Housing Tenants. • General Threshold Requirements: See Section VIII-A of the QAP for threshold requirements that must be followed including: • Inclusion Plan: Owners must demonstrate a partnership with a local lead agency and complete an Inclusion Plan, which includes: • Description of how the project will meet needs of the targeted tenants • Description of the experience of the lead agency and their capacity to provide access to supportive services

  9. (10%) Supportive HousingThreshold Requirement cont. • A Memorandum of Understanding (MOU) • Certification that participation in supportive services will not be a condition of tenancy. • Agreement for 60 day vacancy holding period for special needs tenants • Agreement to maintain separate waiting list • Agreement to affirmatively market to persons with disabilities

  10. (10%) Supportive HousingThreshold Requirement cont. • Agreement to include a section on reasonable accommodation in application for tenancy • Agreement to accept Section 8 vouchers or certificates • A description of how to make targeted units affordable to persons whose incomes are limited to those from a disability-based-source

  11. Inclusion Plan • Required after tax credit award – An acceptable plan is due within 120 after the tax credit award. • Collaborative Effort – Owner, Management Agent, and Lead Agency • Lead Agency – Agrees to act as a provider, coordinator or referral agent

  12. PBV Assistance May 2008

  13. PBV Requests • Due Date: Requests for PBV assistance must be made to the Office of Supportive Housing between now and July 15, 2008. • Conditional Commitment: Upon review of the requested PBV assistance, Supportive Housing will provide a conditional commitment for your tax credit application.

  14. PBV Threshold Standards • Selection of PBV Proposals - LIHTC, and/or MSHDA HOME. • Eligible Units - Available only for special needs units as defined in MSHDA’s Addendum IIIa. • Term of Assistance – Ten (10) year initial term, with five (5) year extensions. (Subject to annual appropriation)

  15. PBV Threshold Standards cont. • Ineligible Units: • Shared housing; • Units on the grounds of a penal, reformatory, medical, mental, or similar private or public institution; • Nursing homes or facilities providing continuous psychiatric, medical, nursing services, board and care or intermediate care; • Units that are owned or controlled by an educational institution or its affiliate and are designated for students by the institution; • Manufactured homes; • Cooperative housing; and • Transitional housing

  16. PBV Threshold Standards cont. • Prohibition of Assistance for Units in Subsidized Housing: • A public housing dwelling unit; • A unit subsidized with any other form of Section 8 assistance (tenant based or project based); • A unit subsidized with any governmental rent subsidy; • A unit subsidized with Section 236 rental assistance payments. However, they may attach assistance to a unit subsidized with Section 236 interest reduction payments; • A unit subsidized with rental assistance payments under Section 521 of the Housing Act of 1949, However, they may attach assistance for a unit subsidized with Section 515 interest reduction payments; • A Section 202 project for non-elderly persons with disabilities, or elderly; • Section 811 project-based supportive housing for persons with disabilities; • A unit subsidized with any form of tenant-based rental assistance (TBRA);

  17. PBV Threshold Standards cont. • Site Selection Criteria – MSHDA’s Site Selection Criteria must be met. See Tab CC of the Combined Application • Addendum IIIa or Inclusion Plan – Proposals under the PSH Set-Aside complete the Addendum IIIa, all other PSH proposals must submit the Inclusion Plan. • Environmental Reviews – Proposals must meet the Authority’s Environmental Review (See Tab D of the Combined Application), and NEPA and related applicable federal laws and authorities in accordance with 24 CFR 58.5 and 58.6.requirements.

  18. PBV Threshold Standards cont. • Housing Accessibility – Must comply with program accessibility requirements of Section 504 of the Rehabilitation Act of 1973, and implementing regulations at 24 CFR part 8. • Housing Quality Standards – Each unit must be inspected for compliance with HQS before executing the Housing Assistance Payment (HAP) Contract. • Labor Standards – Nine (9) or more PBV assisted units triggers Davis Bacon requirements

  19. PBV Threshold Standards cont. • Income Limits – Currently, income eligibility is lesser of federal poverty or 30% of AMI. • Proposed change to the PHA plan includes that a minimum of 85% of the PBV assisted units must be occupied by households with incomes at or below 30% of Area Median Income (AMI), with the remainder at or below 50% of AMI.

  20. PBV Threshold Standards cont. • Rent to Owner – For a tax credit development outside a QCT, rent to the owner will be the lowest of: • The tax credit rent minus utility allowance; • The reasonable rent; or • The rent requested by the owner

  21. PBV Threshold Standards cont. • Rent to Owner – For a tax credit development within a QCT, rent to the owner will be the lowest of: • An amount determined by MSHDA, not to exceed 110 percent of the applicable FMR for the unit bedroom size minus any utility allowance; • The reasonable rent; or • The rent requested by the owner

  22. PBV Threshold Standards cont. • Subsidy Layering – All proposals with PBV assistance are subject to a HUD subsidy layering review.

  23. PBV Underwriting Considerations • Feasibility/Commitment – Under the MSHDA Taxable Loan Program, feasibility will be based on rents targeted within the tax credit application for scoring purposes. • Mortgage Term/Prepayment – Standard Direct Lending Programs (TEAM, HOME Team, Taxable…) terms and prepayment conditions.

  24. PBV Underwriting Considerations cont. • Market Studies – All proposals are subject to MSHDA’s Guidelines for Market Studies. (See Tab C of the Combined Application) • Concessions and Inducements - A ¼ percent rate reduction may be available if at least 15% of the units are affordable to a special needs population, where these units are supported with PBV assistance.

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