Attachment H. Neighborhood Impact Program (NIP) Guidelines

Transcription

1 Attachment H. Neighbrhd Impact Prgram (NIP) Guidelines Cntents: 1: Prgram Descriptin 2: Member Participatin and Registratin 3: Funding Use, Limits, and Availability 4: Member Requirements 5: Recipient Requirements 6: Rehabilitatin Requirements 7: Eligible Prperty Types 8: Disbursement Prcess 9: Pst-Disbursement Dcumentatin Requirements 10: Mnitring, Reprting, and Dcumentatin 11: Incme Guidelines (see Attachment D) 93 P age

2 1: Prgram Descriptin The Neighbrhd Impact Prgram (NIP) is part f the Hmewnership Initiatives Prgrams. NIP prvides rehabilitatin assistance t hmewners with husehld incmes at r belw 80% f the area median incme. The maximum subsidy that can be requested per husehld is $7,500. The minimum subsidy that can be requested per husehld is $1,000. NIP may be amended at any time with input frm the Federal Hme Lan Bank f Indianaplis the Bank ) Cuncil and apprval by the Bard. Funding annuncements may be revked by the Bard withut ntice. The Bank als reserves the right t reallcate funds amng prgrams t meet prgram demand and t ensure utilizatin f all funds. 2: Member Participatin Requirements Institutins that are current Members f and eligible t brrw frm the Bank may participate in NIP. The Bank des nt accept applicatins frm institutins with pending applicatins fr membership in the Bank. A list f eligible Members may be btained frm a directry at A. Registratin: All Members must sign and submit a Hmewnership Initiatives Master Agreement and Registratin and Certificatin Frm. Members will be respnsible fr all terms and cnditins cntained in the Hmewnership Initiatives Master Agreement and Registratin and Certificatin Frm, including, but nt limited t, the requirements utlined in this dcument. B. Training: All NEW users f the prgram will be required t participate in training that will prvide infrmatin and instructins n prgram guidelines, disbursements, and dcumentatin requirements. NEW users are defined as thse Members wh have never participated in the prgram r thse wh have nt received a disbursement in the prir tw years. At a minimum, either the Member s Primary r Secndary cntact is required t participate in the training. C. Submitting Disbursement Requests: Upn apprval f the Hmewnership Initiatives Master Agreement, Registratin and Certificatin Frm and cmpletin f required training, Members will receive a Starter Kit with all f the infrmatin and frms needed t start requesting disbursements. 3: Funding Use, Limits, and Availability NIP funds may nly be used t pay fr apprved eligible rehabilitatin/repair csts unless therwise nted. The Bank must make available at least ne-third f the aggregate annual Hmewnership Initiatives Prgrams allcatin t prgrams that assist first-time hmebuyers r prvide wner-ccupied rehabilitatin. NIP funds cannt be used t pay fr fees charged by Members r spnsrs fr prviding the subsidy t a hmewner. The rate f interest, pints, fees, and any ther charges fr all lans that are made fr the prject in cnjunctin with the AHP subsidy shall nt exceed a reasnable market rate f interest, pints, fees, and ther charges fr lans f similar maturity, terms and risk. Each participating Member will be limited t $300,000 in annual NIP funds, unless such limit is waived by the Bard. 94 P age

3 Hmewnership Initiatives Prgrams funding will be annunced in the spring. Funds will be made available n a first-cme first-served basis until all funds are exhausted. Thrughut the prgram year, the remaining amunt f funds available will be published n the Bank s Web site at least bi-weekly. 4: Member Requirements Members must prvide funds nly t hmewners wh meet the incme guidelines as described in Attachment D f the current Affrdable Husing Prgram Implementatin Plan (Plan). The Member is respnsible fr cmpliance with all applicable laws, regulatins, and with this Plan. Members must enrll each husehld in a Bank Hmewnership Initiatives Prgram. The enrllment date is defined by the Bank as the date n which the Member issues a qualificatin r ther such lan cmmitment r enrlls the husehld in a Bank Hmewnership Initiatives Prgram. Members must submit a disbursement request t the Bank within 30 days after enrllment f the husehld int a Bank Hmewnership Initiatives Prgram. Members must cnfirm that the recipient wners have wned the prperty in fee-simple fr at least 6 mnths prir t enrllment. N additinal persns may have held title t the prperty during the 6-mnth perid ther than the children f the hmewner wh are n title fr estate planning purpses. Members must ensure that prpsed csts are reasnable based n the lcal market. Members must ensure that rehabilitatin wrk perfrmed meets the requirements utlined in the Rehabilitatin Requirements sectin f this attachment. Fr prperties that include a hme-based business, Members must certify that the grant funds will nt be used t cver csts t rehabilitate areas f the hme exclusively designated fr business use. Members must cmply with the Bank s requirements t prvide cpies f rehabilitatin clsing statements and ther dcumentatin as described in this dcument. Members must maintain prject files with all applicable infrmatin fr all grant recipients. Members must ensure that NIP funds are nt used t pay fr fees charged by Members r spnsrs fr prviding the subsidy t a hmewner. Members shuld exercise due diligence in qualifying NIP transactins and are advised t btain the fllwing items fr review prir t apprving a NIP grant t ensure that the funds will be prvided t husehlds stable in their financial affairs. Verificatin that legal title is vested in applicant(s) nly (except when the hmewner s children are n title fr estate planning purpses) A title search that will prvide infrmatin n utstanding liens and prperty tax infrmatin t ensure the hmewner is nt in default n bligatins which culd affect hme retentin Credit reprts t prvide infrmatin n credit bligatins that culd affect hme retentin Hmewner s insurance verificatin t ensure that the hme is prperly insured Pictures f hme r areas t be repaired/replaced prir t cmmencement f wrk Members must certify that the recipient(s) and the prpsed transactin meet all eligibility requirements fr NIP funds. 5: Recipient Requirements Recipients f NIP funds must meet all f the fllwing requirements: 95 P age

4 Recipients must have husehld incme that is equal t r less than 80% f the area median incme (AMI) adjusted fr family size as published annually by HUD. (Refer t the Bank s Web site fr current AMI charts.). Recipients existing mrtgage bligatin fr the subject prperty must be current and paid as agreed. Recipients must sign an acknwledgement identifying the cntractr which is being used fr the repairs. NIP funds may nly be used t prvide assistance t rehabilitate an wner-ccupied residence. Hmebased business rehabilitatin is nt an eligible stand-alne use under the NIP. Fr eligible husehlds whse hme-based business is als lcated in the husing unit r n the prperty, NIP funds may be used if the primary purpse f the prpsed rehabilitatin is t rehabilitate and prvide general benefit t the residence. Prpsed rehabilitatin that will nly benefit the area f the hme exclusively designated fr business use is nt an eligible use under the NIP. This plicy applies whether r nt the incme generated frm the business activity is the primary r secndary surce f incme t the husehld. Recipients must prvide all dcumentatin t the Member as required fr participatin in the prgram. Recipients cannt receive, fr the same prperty in a five year perid, mre than ne Bank grant f any kind, r mre than ne grant frm any Federal Hme Lan Bank, unless prir grants have been repaid r retentin perid has expired. Applicants may nt be students with part-time r n incme while in schl wh rdinarily wuld have a reasnable prspect fr a substantial increase in incme exceeding the AHP incme eligibility limit upn entering the wrkfrce fulltime. In determining an applicant s eligibility, the Bank will cnsider factrs including, but nt limited t, the applicant s current student status, number f hurs currently enrlled, anticipated date f graduatin and field f study. Supprting dcumentatin will be required. 6: Rehabilitatin/Repair Requirements Eligible repairs must address deferred maintenance needs f the hme. Funds may nly be used fr repairs t the livable space f the hme. Rehabilitatin and repair f systems and materials must be f similar quality, like and style. The Bank may exercise discretin in determining if repairs are eligible fr funding. Members must execute a certificatin f cst reasnableness and maintain cpies f all bids btained t supprt the prpsed wrk. Rehabilitatin/repair wrk cmpleted prir t enrllment may nt be paid fr with NIP funds. A. Eligible Rehabilitatin/Repair The fllwing types f repairs are eligible fr funding under NIP: Repair/replacement f existing heating, ventilatin, air cnditining Repair/replacement f existing well/septic system r undergrund prperty sewer system* Repair/replacement f existing water heater Energy cnservatin imprvements includes repair/replacement f existing: Windws Sffit and Fascia Siding Rfing Gutters Dwnsputs 96 P age

5 Caulking Exterir drs Weather stripping, attic and wall insulatin Electrical replacement f knb-and-tube wiring that prevents a hme frm meeting current cde requirements fr its area * Additinal dcumentatin may be required. If the hmewner is a licensed cntractr and requests t perfrm the NIP-eligible repairs n his/her wn hme, these guidelines must be fllwed: 1) The hmewner must be licensed in the same field f the prpsed repairs, i.e., if the prpsed wrk is rfing, the hmewner must be a licensed rfer. A cpy f the cntractr s license must be submitted with the disbursement request. 2) The cst f labr is nt an eligible NIP expense. 3) A minimum f tw bids fr the prpsed wrk must be btained frm independent third parties. The bids must itemize the csts fr bth labr and material separately. 4) The husehld will need t prvide receipts t crrespnd with the necessary supplies fr the prpsed wrk. 5) The Member needs t rder an independent third-party inspectin t verify the repairs were cmpleted as indicated. 6) Befre and after pictures are required. B. Ineligible Rehabilitatin/Repair In general, imprvements in functinality/mdernizatin, changes fr eliminatin f bslescence, luxury items, imprvements that d nt becme a permanent part f the prperty, and installatin r repair f items listed belw are nt eligible imprvements. The list is nt all-inclusive and the Bank suggests that Members use prudent decisin-making when apprving requested imprvements. Any exceptins must be preapprved by the Bank. Additins r alteratins fr cmmercial use Prches, detached garages, etc. The finishing f attics, basements, etc. Furniture and appliances Landscaping r tree wrk Fences Rm additins Driveways and sidewalks Awnings and shutters 7: Eligible Prperty Types The fllwing prperty types are eligible t receive NIP funding: Owner-ccupied 1-4 family prperties 97 P age

6 Twnhuses Cndminiums Cperatives Manufactured husing deeded as Real Estate Lease/purchase arrangements and land cntracts are nt eligible wnership structures. All prperties must be titled as real estate and be permanently affixed t a permanent fundatin. 8: Disbursement Prcess T request funds, Members must submit the required dcuments fr each husehld, as defined in the Starter Kit. During times f nrmal vlume, disbursement requests shuld be reviewed and/r apprved within ten business days. Upn apprval, the funds will be credited t the Member s Bank CMS accunt. N substitutins f husehlds will be allwed. The Member must pass the entire amunt f the AHP subsidy t the husehld. Disbursement Recmmendatins The Member has a fiduciary respnsibility when managing NIP funds. The Member shuld take every precautin t prevent fraud and misuse f NIP funds. T d s, it is recmmended that the Member: a) Cnsider establishing an escrw accunt t disburse funds as the wrk is cmpleted. b) Request that the hmewner prvide yu with invices and make checks jintly payable t the cntractr r ther service prvider and the hmewner. c) Take befre and after phts t verify cmpletin f wrk. d) Perfrm prperty inspectins fr each draw f funds. e) Require all wrk be cmpleted by a licensed/bnded cntractr. f) If wrk is being perfrmed by a related party t the hmewner, ensure that all repairs included in the riginal bid are being cmpleted and funds are being used fr said repairs. 9: Pst-Disbursement Requirements and Dcumentatin Rehabilitatin Clsing All hme repairs shuld be cmpleted within 6 mnths f the Bank s disbursement f funds alng with all funds disbursed fr services perfrmed. The Member is respnsible fr managing the prgress and cmpletin f the repair prject. The Bank requires that the Rehabilitatin Clsing Statement (RCS) be cmpleted upn cmpletin f all repairs. The frm is available n the Bank s Web site. All csts assciated with each repair must be dcumented. Members must ensure that the apprpriate subsidy amunt received frm the Bank is clearly identified. The ttal cst f the repair including an itemized descriptin f the repairs must be dcumented. Members are required t sign the RCS. 10: Mnitring, Reprting, and Dcumentatin Annually, the Bank will request dcumentatin fr a randmly selected sample f husehlds. The dcumentatin requested may include any f the dcuments that Members are required t maintain in their files. Members have 30 days t submit the requested dcumentatin. If dcumentatin is nt received within 30 days, the Bank reserves the right t deem the Member t have vilated the terms f the award and debit the Member s CMS accunt fr the apprpriate amunt. The Member will then need t reapply fr funding fr the particular husehld, subject t funding availability. At a minimum, Members shuld maintain the fllwing dcumentatin in their files fr every NIP recipient: 1) Applicatin used t btain husehld infrmatin. 98 P age

7 2) A cpy f the disbursement request and all dcumentatin btained and used t qualify the husehld at enrllment. 3) Final, fully-executed Rehabilitatin Clsing Statement, executed by bth the hmewner and the Member. 4) Original bids t supprt the executed Certificatin f Cst Reasnableness. 5) Final cst verificatin fr rehabilitatin wrk perfrmed evidenced by cpies f final invices, receipts and cancelled checks r similar frms f payments t the cntractr(s). On-Site Mnitring At the discretin f the Bank, participating Members may be selected fr mnitring review. During reviews, which are held at the Member s place f business, the Bank reviews the Member s plicies and prcedures fr administering NIP and a sampling f the grant recipient files. The Bank reserves the right t review all files if sampling indicates cmpliance issues. 11: Incme Guidelines (see Attachment D) All Members must use the incme guidelines as utlined in Attachment D f the current Plan. Husehlds must have incmes at r belw 80% f the median incme fr the area at the time the husehld is accepted fr enrllment by the Member. 99 P age