Housing Assistance Council Building Rural Communities since 1971 Program & Application Information Session

 Provide a basic overview of the SHOP Program thresholds and requirements.  Provide and overview of HAC’s SHOP requirements.  Provided and overview HAC’s SHOP application and required documentation.  Answer any SHOP related questions.

Our mission “To improve housing conditions for the rural poor, with an emphasis on the poorest of the poor in the most rural places.”

Housing Assistance Council  Established in 1971  National nonprofit organization  Created to increase the availability of decent and affordable housing for low-income people in rural areas throughout the U.S.  Provide services to local, state, and national organizations

SHOP ESSENTIALS AND PROGRAM INFORMATION

HUD’s SHOP Program  The SHOP program is authorized under Section 11 of the Housing Opportunity Program Extension Act of 1996  Funded through the U.S. Department of Housing & Urban Development (HUD)  Provides grant monies for land acquisition and infrastructure improvement costs associated with the development of self-help units

SHOP Threshold Requirements  Non-profit Status  Experience  Dun and Bradstreet Data Universal Numbering System (DUNS)  Active Registration System for Award Management (SAM) - formally CCR  Resolution of Outstanding Civil Rights Matters

SHOP Threshold Requirements (continued)  Debarment and Suspension  Delinquent Federal Debts  Pre –Award Accounting System Survey  Name Check Review  False Statements

SHOP General Requirements Eligible Activities  Land Acquisition: The acquisition of land (including financing and reasonable and customary closing costs) for the purpose of developing or rehabilitating SHOP units is an eligible activity.  Infrastructure Improvements: Included but not limited to the installation, extension, construction, rehabilitation, or other improvement of utilities and other infrastructure (including the removal of environmental hazards) in support of the development or rehabilitation of SHOP units.

SHOP General Requirements (continued) Property Standards The statute requires that funds be used for quality “decent, safe and sanitary non-luxury dwellings” that “comply with local building safety codes and standards.”

SHOP General Requirements (continued)  Energy-Efficiency: Your SHOP units in newly constructed buildings or gut-rehabilitated buildings will be certified as meeting the guidelines for either ENERGY STAR New Homes or ENERGY STAR Multi-family High Rise (MFHR), as determined by the U.S. Environmental Protection Agency and the U.S. Department of Energy.  Water Conservation: Applicants are required to incorporate specific water-conservation measures in the construction and/or rehabilitation of the SHOP units.

SHOP General Requirements (continued) Energy Star Version 3.0 All SHOP units constructed after January 1, 2012 are required to develop units under the following guidelines: Thermal Enclosure System Rater Checklist HVAC System Quality Installation Rater Checklist HVAC System Quality Installation Contractor Checklist Water Management System Builder Checklist

SHOP General Requirements (continued)  Homebuyer Eligibility: individuals and families whose incomes do not exceed 80 percent of the median income  Sweat Equity Minimum Sweat Equity Contribution: Eligible homebuyers will contribute a minimum of 100 sweat equity hours.  Value of Sweat Equity Contribution: homebuyer must receive the full value of the homebuyer’s sweat equity contribution as an equity contribution towards the purchase of the homebuyer’s SHOP unit.  No Homebuyer Financial Contribution by the Homebuyer

SHOP General Requirements (continued)  Volunteer Labor  Leveraged Resources  Affirmatively Furthering Fair Housing

SHOP General Requirements (continued)  Sale Price: You must sell each SHOP unit below the appraised value of the property.  Mortgages and Other Loans: The homebuyer’s sweat equity contribution must not be mortgaged or otherwise restricted upon future sale of the SHOP unit.  Sale Price Reduction: The SHOP unit sale price is reduced by the value of the homebuyer’s sweat equity.  Homebuyer Credit: The value of the homebuyer’s sweat equity is treated as a credit towards the SHOP unit sale price.

SHOP General Requirements (continued)  Accessibility For Qualified Individuals with Disabilities  Economic Opportunities For Low-and Very Low- Income Persons (Section 3)  Real Property Acquisition and Relocation

SHOP General Requirements (continued) Environmental Review All projects receiving SHOP funding must complete this process Complicated and time consuming Start the ER process NOW No disbursement until HAC receives HUD approval.

SHOP General Requirements (continued)  Occupational Safety and Health  Lead Safe Requirements  Indoor Air Quality  Standards of Financial Control

Eligible Applicants Eligible applicants for HAC SHOP funds are limited to local (public or private) nonprofit self-help housing organizations established under federal or state law.

An affiliate organization will be disqualified if applying to more than one HUD SHOP grantee

Eligible Uses Land Acquisition  Purchase of real property pursuant to a deed or minimum 25 year lease  Financing and closing costs associated with the land acquisition transaction

Eligible Uses Infrastructure Improvements: Utility hook-ups and connections, including, but not limited to, water, electric, gas, and sewage lines; Wells and waste disposal systems, including, but not limited to, sewer and septic systems; Impact and building fees; Streets, streetlights, curbs, roads and sidewalks; Surveys; Engineering fees; and Costs associated with the removal of environmental hazards including environmental testing and site preparation, including, but not limited to grading, razing, de-leading, hazardous waste clean-up and other environmental cleanup costs.

Eligible Uses Administrative cost: Costs associated with the closing of a SHOP award e.g., Settlement or closing fees Abstract of title search, title examination, & title insurance Document preparation (promissory note, deed of trust, mortgages) Attorney fees Recordation fees (City, County, State tax stamps) Escrow services (Courier costs and notary fees)

Ineligible Uses  Construction, rehabilitation, or improvement of any dwelling unit.  Land acquisition for land banking purposes (i.e., holding land for an indefinite period).  Homebuyer pre- and post-purchase counseling costs  Refinancing of loans for land acquired before NOFA issue date.

Ineligible Uses  Land acquisition that does not comply with the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (URA).  Interest on loans used to pay for infrastructure costs.  Landscaping: (e.g. plantings, seeding, and mulching) is not an eligible SHOP infrastructure cost, unless it relates to subsurface conditions or environmental concerns such as installing a retaining wall to prevent erosion.

Eligible Homebuyers  Low-income individuals and families whose incomes are at or below 80% of AMI.  Minimum of 100 hours (50 hours for one adult household and or disabled participant) of sweat equity by homebuyer on construction of homebuyers house.  Persons with disabilities - Tasks  Sweat equity hours exclude homebuyer counseling and home maintenance training

HAC SHOP Award Limits  No maximum dollar cap  Per dwelling unit request can not exceed $15,000  Only apply for one (1) project.

Timelines

SHOP Award Terms & Conditions 1. Recoverable grant. 2. All units completed and occupied by the required deadline. 3. Interest assessed on units not completed/occupied by the production deadline. 4. Up to 90% of SHOP award may be converted to a grant.

SUBMITTING APPLICATION All applicants must complete the “SHOP Threshold and Program Requirement Questionnaires” and include them as part of the application submission.

UNDERWRITING CRITERIA What HAC looks for in an application

PART I Organizational Capability and Experience of the Applicant PART I: Organizational Capability and Experience of the Applicant (20 Points)

PART II: Financial Capability and Experience (20 Points)

(50 Points)

(10 Points)

PART V: Bonus Points (6 points)

Application Forms In addition to the narrative portion of the application, all applicants must complete and submit the following documents and forms. Failure to complete and submit required documents may result in the rejection of your application. Required Forms

SHOP Ready or Not? Do you have?  Administrative funding in place  Experienced project staff on board  Construction & permanent financing identified  Sites identified & pre-qualified families  Waiting lists of pre-qualified homebuyers  Groups should be current with HAC’s quarterly reporting requirements.

Contact Information Housing Assistance Council (202) (202) Fax Frank Martinez Senior Loan Officer Ext. 126 Dierdra Pressley Loan Officer Ext. 154 Carlos Muralles SHOP Program Manager Ext. 144 Tanisha Jacob Loan Fund Assistant Ext. 128