NYS HOME LOCAL PROGRAM AWARD ORIENTATION WORKSHOP

Transcription

1 NYS HOME LOCAL PROGRAM AWARD ORIENTATION WORKSHOP New York State Homes and Community Renewal New York State Housing Trust Fund Corporation Office of Community Renewal

2 NYS HCR - HTFC HOME LOCAL PROGRAM Ann M. Petersen, LEED AP Director, NYS HOME Local Program New York State Homes and Community Renewal Office of Community Renewal State Street, Albany, NY PH: (518) FX: (518) apetersen@nyshcr.org 2

3 6 MONTHS, SO FAR, SO GOOD THANK YOU GOVERNOR ANDREW CUOMO And OFFICE OF COMMUNITY RENEWAL MATTHEW NELSON - PRESIDENT CHRIS LEO - VICE-PRESIDENT 3

4 IT TOOK 20 YEARS TO GET HERE Fair Housing Program Coordinator (City) Comprehensive Housing Counselor (City) Loan Officer (Down payment Assistance) (LDC) Administrative Director (Community Land Trust) (NFP) Homeownership Coordinator (Housing Authority) (HA) Homeownership Coordinator (City) HOME Consortium (PJ - Lead Entity) (3 Cities) LEED AP (United States Green Building Council) (City) Leadership in Energy and Environmental Design Accredited Professional 4

5 REGIONAL PROGRAM MANAGERS Buffalo Regional Office: Emma Watson Syracuse Regional Office: Richard Baldwin Albany Regional Office: Glen Laws Christine Newell 5

6 LPA = LOCAL PROGRAM ADMINISTRATOR 30 LPA AWARDEES = $10,534, CITIES, TOWNS, VILLAGES 18 NON-PROFITS ACTIVITY TYPE 1 CHDO 4 HOMEBUYER 25 HOMEOWNER OCCUPIED REHAB Congratulations! We are proud to award HTFC HOME Local Program funds to your community! 6

7 Agenda What s New for 2012 Contract Overview Back to the Basics Questions and Answers Individual Meetings with Regional Program Managers 7

8 HOUSE KEEPING 10:30-12:30pm Contract Orientation 12:30-1:30pm Lunch 1:30 3:30PM Meet with your Regional Program Manager 8

9 WHAT S NEW FOR 2012 HOME APPROPRIATIONS ACT What HUD says: The purpose of these requirements is to improve project and developer selection by participating jurisdictions (PJs) and ensure that there is adequate market demand for FY 2012 HOME projects. 9

10 NYS HOUSING TRUST FUND CORPORATION The NYS HTFC is a PJ. HUD requires us to comply with new rules or risk loosing our direct allocation of HOME funds. In order to give you our 2012 HOME funds, we have to ensure you comply with the new rules. 10

11 2012 APROPRIATIONS ACT HTFC must repay any HOME funds invested in projects that are not completed within four years of the commitment date. HUD may grant a one year extension upon determination that the failure to complete the project is beyond the control of the HTFC. 11

12 BEFORE CONTRACT EXECUTION Development Activities: acquisition, construction, rehabilitation of rental or homebuyer projects, including down payment assistance. Need to conduct an underwriting review of the project, assess developer capacity, fiscal soundness and examine neighborhood market conditions to ensure adequate need for each project. 12

13 ASSESSMENT SHOULD INCLUDE Types of needed housing Target locations and neighborhoods Target household types Competition Format and amount of available subsidy Housing demand, vacancy rates Demographic trends, housing supply construction trends 13

14 UNDERWRITING AND MARKET NEED HUD has not given specific direction on how to accomplish, we are open to your ideas. In house market assessment, contract for market assessment, review market assessment from developer? 14

15 DOES ANYONE HAVE A MARKET STUDY I CAN BORROW? 2012 HOME LPA application Needs Assessment? Has the Consolidated Plan, Annual Action Plan or some other data set been updated recently? Real Estate? Lenders? 15

16 WHAT IF YOU CAN T SELL? HTFC must convert all homebuyer units, not sold within 6 months of construction completion, into HOME rental units or the HOME investment must be repaid. This could create serious budget issues. How big can we make the contingency??? 16

17 CHDO STAFF HTFC can t reserve funds to a CHDO for development activities, unless it has predetermined that the CHDO has staff with demonstrated development experience. A consultant with development experience does not qualify as staff. 17

18 HOMEBUYER PROJECTS If the activity involves acquisition, construction or rehabilitation of homebuyer units, to include down payment assistance, we must assess market, developer and project risk. Underwrite the project for development and the homebuyer. 18

19 HOMEBUYER PROJECTS Assess developer capacity and fiscal soundness experience and current capability. Examine neighborhood market conditions is there an adequate demand for the units? 19

20 HOMEBUYER PROJECTS Portfolio risk, subsidy layering, program performance considerations. Underwrite the Project - adequate funds, financing, subsidy layering review, homebuyer affordability analysis, PITI assessments. 20

21 CHDO DEVELOPEMENT For CHDO s acting as developer, owner, or sponsor. To be designated as a CHDO, we follow the existing process (Board makeup, etc.) as before, but now we must also underwrite the development, assess market conditions and staff capacity for each project. 21

22 CHDO CERTIFICATION CHDO s are now given CHDO Certification on a project by project basis. HTFC must certify that CHDO has development capacity at CHDO Reservation of HOME Set-Aside Funds. HTFC must certify that we have underwritten the project at CHDO commitment. 22

23 CHDO CERTIFICATION HTFC must certify that the staff has demonstrated development experience, same size, scope and level of complexity, compared to past experience. HTFC must certify that we have assessed market conditions prior to CHDO commitment. 23

24 THANK YOU FOR THE GOOD WORK! AND THE PICTURES! 24

25 HTFC HOME LPA CONTRACTS HTFC has 3 types of contracts in the HOME LPA Program: State Recipient Cities, Towns & Villages Sub recipient - Non-profits CHDO - Community Housing Development Organization This presentation is based on HTFC s Sub recipient contract 25

26 SLIDE DESIGN EXPLANATION We decided to not print note taker slides, we will have them available on the website The actual contract clauses in the presentation are in 14 point font, large enough to read There will be clauses and info in this section that may be hard to read on the screen today, but you will be able to read it in your printed copy and have all info in one place 26

27 WHEN CAN YOU EXECUTE YOUR CONTRACT? Based on new ERR process, all LPA s should receive (state recipients may have already received) ATUGF by mid-may HTFC expecting to mail out contracts by end of April, some may be delayed pending needed verification of Appropriations Act requirements 2 year term, We want you to execute and start spending immediately Homeowner occupied rehab, same as usual Homebuyer, development, CHDO s need to document Appropriations Act compliance 27

28 HUD RULES FOR HOME PROGRAM CONTRACTS 28

29 I THINK WE NEED ANOTHER PICTURE! 29

30 YOU WANT ME TO READ MY CONTRACT? How long has it been since you looked at your admin plan? Wait there is a budget I have to follow?? And you want me to complete all the units and spend the funds by when??? 30

31 Contents of Agreement The Sub recipient s approved Application and accompanying submissions, as modified by the terms of this Agreement or any subsequent amendment approved by the Corporation. The Corporation's HOME Local Program Guidelines (as now in effect and as may be amended from time to time). Exhibit A, Program Summary and Description of Target Area Exhibit B, Administrative Plan Exhibit C, Program Budget Exhibit D, Program Schedule Exhibit E, 2102 Appropriations Act Requirements Exhibit F, Administrative Plan Amendments Exhibit G, Back to the Basics 31

32 Use of HOME LPA Funds 1. Administer the Program in accordance with the Administrative Plan 1. Complete the Program in accordance with the Program Schedule 2. Adhere to the Program Budget and shall provide additional funds if the cost of the Program exceeds the Total Program Costs as set forth in the Program Budget. 32

33 Amount of HOME LPA Funds 1. The amount of HOME Funds that the Corporation has agreed to provide the Sub recipient under this Agreement is expressly conditioned upon the Corporation's receipt of HOME Funds from HUD pursuant to the Federal Statute. 1. The HOME Funds to be disbursed hereunder shall not exceed the amount first set forth in this Agreement, and any additional funds required to complete the Project will be the sole responsibility of the Sub recipient. 1. The HOME Funds are based upon the cost estimates provided by the Sub recipient in its Application. The Corporation reserves the right to reduce the amount of HOME Funds: I. to conform to any revision to which the parties may agree with respect to the Sub recipient's Application; or II. if the actual costs for the approved activities are less than those budgeted for in the Sub recipient s Application 33

34 Affordability The Sub recipient shall comply with the Period of Affordability requirements as set forth in 24 Code of Federal Regulations ( CFR ) and and shall require that the HOME assisted housing meet the affordability requirements, as applicable, based on the amount of HOME funds invested per unit. If the HOME assisted housing no longer meets the affordability requirements of this section, the Sub recipient must repay the HOME funds to the Corporation. The Sub recipient must use, as approved by the Corporation, either the Corporation s provided Note and Mortgage (recapture of funds) or Restrictive Covenant (resale restriction) to secure the HOME LPA investment. Choose up front either RECAPTURE or RESALE HTFC provided note & mortgage or restrictive covenant (in favor of HTFC) Owner-Occ Rehab = 5 year POA All other activity, POA based on the amount of HOME funds invested HOME investment per Unit Less than $15,000 Length of the Affordability Period 5 years $15,000 - $40, years More than $40,000 New construction of rental housing Refinancing of rental housing 15 years 20 years 15 years 34

35 Program Income and Recaptured Funds If not provided elsewhere in this Agreement, all program income, proceeds, unexpended funds, recaptured funds or other assets, interest income or other income deriving from funds provided pursuant to this Agreement received by the Sub recipient shall be returned to the Corporation. The Sub recipient shall furnish financial records detailing all program income and must remit program income and/or recaptured funds to the Corporation, within 30 days of receipt by the Sub recipient. All program income and recaptured funds must be returned to HTFC within 30 days of receipt by LPA. 35

36 Uniform Administrative Requirements The Sub recipient shall comply with applicable uniform administrative requirements as set forth in 24 CFR : the requirements of OMB Circular No. A-122 and the following requirements of 24 CFR part 84: 84.2, 84.5, through 84.16, 84.21, 84.22, through 84.28, 84.30, 84.31, through 84.37, through 84.48, 84.51, through 84.62, 84.72, and Financial management Audit standards Cost principals, allowable costs Procurement Reporting & Record-keeping 36

37 Other Federal Requirements The Sub recipient shall, during the Term of this Agreement, carry out each activity in compliance with all Federal Laws and regulations as applicable described in 24 CFR Part 92, subpart H except the provisions relating to environmental review under and the intergovernmental review process under Non Discrimination and Equal Access Fair Housing and Equal Opportunity Affirmative Marketing Housing with 5 or more HOME assisted units Handicapped Accessibility Americans with Disabilities, Fair Housing, Section 504 Property Standards Employment and Contracting Equal Opportunity Section 3 Labor Requirements Contracting and Procurement Practices 37

38 NON DISCRIMINATION AND EQUAL ACCESS The Sub recipient shall comply with the following, as applicable: 1. Fair Housing and Equal Opportunity: Title VI of the Civil Rights Act of 1964, Amended (42 U.S.C. 2000d et seq.), the Fair Housing Act (42 U.S.C ), Equal Opportunity in Housing (Executive Order 11063, as amended by Executive Order and the Age discrimination Act of 1975, As Amended (42 U.S.C. 6101). 2. Affirmative Marketing and Minority Outreach: 24 CFR c) Handicapped Accessibility: Americans with Disabilities Act (42 U.S.C ; 47 U.S.C. 155,201,218 and 225, the Fair Housing Act and accessibility requirements at 24 CFR part 8, which implements Section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794). Covered multifamily dwellings, as defined at 24 CFR , must also meet the design and construction requirements at 24 CFR , which implement the Fair Housing Act (42 U.S.C ). 38

39 Employment and Contracting The Sub recipient shall comply with the following, as applicable: 1. Equal Opportunity: Equal Employment Opportunity, Executive Order 11246, as amended, Section 3 of the Housing and Urban Development Act of 1968, Minority/Women s Business Enterprise: Executive Orders 11625, and Labor Requirements: Davis Bacon and Related Acts (40 USC 276 (A)-7), Contract Work Hours and Safety Standards Act, as amended (40 USC ), Copeland (Anti-Kickback) Act (40 USC 276c), Fair Labor Standards Act of 1938, as amended (29 USC 201, et. Seq.). 3. Contracting and Procurement Practices: Procurement Standards for nonprofit organizations at 24 CFR Part Conflict of Interest: 24 CFR Parts and 85 and 24 CFR Part Debarred Contractors: each contractor employed must be checked to ensure the contractor is not on the Federal debarred, suspended or ineligible contractor list. 39

40 Property Standards The Sub recipient shall meet the property standards, as applicable, under to ensure that the housing acquired, constructed or rehabilitated with HOME funds meets all applicable State and Local codes (the housing assisted must meet code and receive a Certificate of Occupancy, or an equivalent acceptable to the Corporation, upon completion). The Sub recipient shall meet the property standards of the NYS Housing Trust Fund Corporation Rehabilitation Standards for One- to Four-Unit Structures Rev. June, In the absence of a local code for new construction or rehabilitation, HOMEassisted new construction or rehabilitation must meet, as applicable, model codes: Uniform Building Code (ICBO), the National Building Code (BOCA), or the One and Two Family Dwelling Code of the Council of American Building Officials (CABO). All housing occupied by tenants receiving HOME tenant-based rental assistance must meet the Housing Quality Standards in 24 CFR Must submit documentation that meets code at completion 40

41 Manufactured Housing Must meet the Manufactured Home Construction and Safety Standards at 24 CFR Part 3280 and applicable State and local laws and codes. All replaced mobile homes must be replaced with new, HUD Certified, ENERGY STAR qualified manufactured homes. 41

42 Lead Based Paint The Sub recipient shall comply with lead-based paint requirements at 24 CFR and is subject to the Lead- Based Paint Poisoning Prevention Act (42 U.S.C ), the Residential Lead-Based Paint Hazard Reduction Act of 1992 (42 U.S.C ), and implementing regulations at part 35, subparts A, B, J, K, M and R. There is no waiver of LBP rules. When using a range of assistance ($25k per unit to $35k max), please submit your LBP calculation when you are setting up the unit. If you make a mistake, it could cost you! 42

43 Maximum Property Value The Sub recipient shall comply with 24 CFR for qualification as affordable housing and will use the Single Family Mortgage Limits under section 203(b) of the National Housing Act (12 U.S.C. 1709(b)) to determine that the value of the unit, after rehabilitation, does not exceed 95% of the median purchase price for the service area. The price (homebuyer) and or value (owner occupied rehab) may not exceed 95% of the area median purchase price for that type of housing. Need to determine maximum property value Homebuyer Need to determine after rehab value - owner occupied rehab How do we get the 95% purchase price value? FHA 203(b) limits 43

44 Requests for Disbursements of Funds The Sub recipient shall not request disbursement of funds under this Agreement until the funds are needed for payment of eligible costs. Advances of funds are not permitted. Requests for disbursement of funds for housing construction or rehabilitation activities will require submission of a certification, signed by a construction professional acceptable to the Corporation, that the work has been satisfactorily completed. The amount of each request shall be limited to the amount needed to pay such costs incurred. Payments of funds under this Agreement are also subject to the Sub recipient's compliance with the requirements of HUD's Integrated Disbursement and Information System or any other similar or successor system used by HUD and all further documentation which may be demanded by the Corporation related to any request for funds. HTFC will only pay for work that has been completed. Payment for construction, rehab activities requires a sign off by a construction professional, that work has been completed. 44

45 Reversion of Assets Upon expiration of this Agreement, the Sub recipient shall transfer to the Corporation any HOME funds on hand at the time of said expiration and any accounts receivable attributable to the use of HOME funds. Any real property under the control of the Sub recipient that was acquired or improved in whole or in part with HOME funds in excess of $5,000 shall be used to meet the requirements described in Section or of 24 CFR Part 92 or disposed of in a manner that results in the Corporation being reimbursed in the amount of the current fair market value of the property less any portion of the value attributable to expenditures of non-home funds for acquisition of, or improvement to, the property. If there are funds left at the end of your contract, you have to give it back. 45

46 Records and Reports, Inspections The Sub recipient shall maintain records, submit reports and cooperate with audits and inspections required by the Corporation. The Sub recipient shall submit performance reports, in such format and at such times as the Corporation or HUD may prescribe and shall provide to the Corporation any document, report or information that the Corporation deems necessary. The Sub recipient shall comply with the requirements of OMB Circular A-133 and submit any audits to the Corporation as required by said A-133. For the purposes of compliance with Circular A-133, the HOME Catalogue of Federal Domestic Assistance Number is Just give us your first born! Annual Performance Report, Desk Audit, Financial Audit, Program Monitoring, Project Monitoring, Period of Affordability Monitoring, Rent and Occupancy Limits, Site Inspections, LBP Calculations, yada,yada,yada 46

47 Insurance During the Term, the Sub recipient shall take all adequate measures to safeguard against the risk of liability for injuries or death of employees of the Sub recipient, contractors and subcontractors, and of any other persons. The Sub recipient shall provide the Corporation with a certificate for comprehensive general liability coverage in a minimum amount of one million dollars naming the Corporation and the State of New York as additional insured s, and fidelity bond/crime coverage in an amount not less than the largest anticipated disbursement request for Program funds, naming the Corporation as Loss Payee, together with certificates for automobile insurance (if applicable), fire insurance, workers compensation and disability benefits. Disbursements requested in excess of the fidelity bond coverage will be reduced to the maximum amount of the fidelity bond in effect. The Corporation also reserves the right to further reduce such disbursement or to refuse payment of a disbursement if it is determined that previous disbursements have not yet been distributed to contractors or vendors, and such current disbursement will cause the fidelity bond coverage to be exceeded. All certificates shall be with a New York State licensed carrier of insurance. Within two (2) business days of having received any notice of non-renewal, cancellation, termination, or rescindment for any type of insurance required herein, the Sub recipient shall provide the Corporation with a copy of such notice, either by facsimile or electronic mail (in pdf format) to the signatory hereof, together with an explanation of any efforts taken to reinstate such coverage. The Sub recipient may not cancel, terminate or fail to renew any insurance policy required herein, unless and until the Sub recipient has received the Corporation s written consent thereto. 47

48 Project Monitoring The Sub recipient shall comply with the NYS HCR HOME Program Monitoring Guide for State Recipients and Sub recipients ( Guide ) and will assemble and maintain the files to ensure records of compliance. The Sub recipient will conduct the monitoring activities of the individual projects it administers, per the Guide, and agrees to promptly supply the Corporation with all monitoring documentation as requested. 48

49 Project Closeout Procedures The Sub recipient shall comply with HOME LPA project close out procedures and verify the grant is 100% complete with all required project completion reports and single audits submitted. The Sub recipient must have been monitored with all monitoring findings resolved. HTFC will issue a close out letter detailing project completion to be returned to HCR, signed by Sub recipient. Upon HTFC s written approval of all project completion information submitted, HTFC will close out the contract. 49

50 Indemnification To the fullest extent permitted by law, the Sub recipient shall defend, indemnify and hold harmless the State of New York, the Corporation and its agents and employees from and against claims, damages, losses and expenses, including, but not limited to attorneys' fees, arising out of or resulting from performance of this Agreement or the work to be performed pursuant hereto, provided that such claim, damage, loss or expense is attributable to bodily injury, sickness, disease or death, or to injury to or destruction of tangible property (other than the work itself) including loss of use resulting therefrom, but only to the extent caused in whole or in part by negligent or willful acts or omissions of the Sub recipient, a contractor or subcontractor or anyone directly or indirectly employed by them or anyone for whose acts they may be liable, regardless of whether or not such claim, damage, loss or expense is caused in part by a party indemnified hereunder. 50

51 Notice of Investigation or Default The Sub recipient certifies to the best of its knowledge, for the period beginning ten years prior to the date of this Agreement, the Sub recipient has not: 1. been the subject of any governmental agency's investigation or audit. 2. defaulted under any mortgage, deed of trust, security agreement, loan agreement or credit instrument executed in connection with any governmental agency's project. 3. breached any agreement, credit agreement, lease or other instrument executed in connection with any governmental agency's project. 4. been suspended, debarred or otherwise restricted by any governmental agency from doing business with such agency. 5. been convicted of, or been the subject of a complaint or indictment charging a felony 6. defaulted on an obligation covered by a surety or performance bond or been the subject of a claim under an employee fidelity bond. The Sub recipient shall notify the Corporation within five days after obtaining knowledge of: 1. the commencement of any investigation or audit of its activities by any governmental agency 2. the alleged default by the Sub recipient under any mortgage, deed of trust, security agreement, loan agreement or credit instrument, whether executed in connection with the project or otherwise; or 3. any alleged breach by the Sub recipient of any agreement, credit agreement, lease or other instrument executed in connection with the project. The Sub recipient shall insure that, in the event of any alleged default under any of such instruments, the mortgagee, secured party, lender or lessor, as the case may be, shall simultaneously send to the Corporation a copy of any notice of such alleged default sent to the Sub recipient, and shall give the Corporation a reasonable opportunity to cure such alleged default; if such mortgagee, secured party, lender or lessor fails to send such simultaneous notice, then the Sub recipient itself shall immediately upon receipt send such notice to the Corporation. For the purposes of this paragraph, the term "Sub recipient" shall include all officers, board members, general partners or other principals, including any person holding a controlling interest in Sub recipient. 51

52 Default/Termination The following shall constitute an event of default hereunder: 1. if the Sub recipient fails, in the opinion of the Corporation, to comply with or perform any of the provisions, conditions or covenants contained in this Agreement, the Statutes, or the rules, regulations, policies and procedures of the Corporation; 2. if at any time any representation or warranty made by the Sub recipient herein shall be incorrect or materially misleading; 3. if a lien for the performance of work or the furnishing or labor or materials is filed against the Program or any improvement financed thereunder and remains unsatisfied, un-discharged or unbonded at the time of any Request for Disbursement or for a period of twenty (20) days after the date of filing of such lien; 4. if the Sub recipient shall fail to comply with any of the terms of any mortgage, deed of trust, security agreement, loan agreement, credit agreement or other instrument executed in favor of any other party, whether or not shown in the Program Budget; 52

53 Default/Termination In accordance with 24 CFR 85.43, suspension or termination may occur if the Sub recipient materially fails to comply with any term of this Agreement, and this Agreement may be terminated for convenience in accordance with 24 CFR The Corporation shall have the right, but not the obligation, upon the happening of any event of default, in addition to any other rights or remedies available to it, to operate and administer the Program and perform or cause the performance of any and all work and labor necessary or desirable to protect the Program; provided, however, that the foregoing shall not be deemed to impose on the Corporation the obligation to prosecute to completion any action taken pursuant hereto and the Corporation shall have no liability to the Sub recipient arising out of the failure to complete any work commenced pursuant to this subsection. 53

54 Default/Termination All sums expended by the Corporation for such purposes shall be deemed to have been provided to the Sub recipient. For this purpose, the Sub recipient hereby constitutes and appoints the Corporation its true and lawful attorney-in-fact with full power of substitution to complete the Program or make repairs in the name of the Sub recipient, and hereby empowers said attorney or attorneys as follows: to use any funds which may remain undisbursed for the purpose of completing the Program substantially in the manner called for by this Agreement; to employ or continue to employ such general contractor subcontractors, material suppliers, laborers, agents, architects and inspectors as shall be required or may be reasonably desirable for said purposes; to pay, settle or compromise all existing bills and claims which are or may be liens against the Program, any improvement financed thereunder, or against the Sub recipient, or may be necessary or desirable for the completion of any work or the clearance of title; to procure such insurance as may in its judgment be desirable; to execute all applications and certificates in the name of the Sub recipient which may be required by any contract or subcontract; and to do any and every act with respect to work on the Program which the Sub recipient may do in its own behalf. It is understood and agreed that this power of attorney shall be deemed to be a power coupled with a secured interest which cannot be revoked. Said attorney-in-fact shall also have power to prosecute and defend all actions or proceedings in connection with work performed on the Program and to take such action and require such performance as is deemed necessary. The Sub recipient hereby conditionally assigns and quitclaims to the Corporation all sums disbursed or to be disbursed hereunder and all retained sums subject to the condition that said sums, if any, be used for work performed on the Program and payment of related expenses as set forth herein. 54

55 Default/Termination For the purposes of subparagraph (c) above, and in connection with 1. any and all contracts and subcontracts for the provision of labor and the furnishing of materials, fixtures and articles in connection with the rehabilitation, construction or conversion of any premises under the Program which are now in existence or which may exist at any time or times in the future, together with any extensions or renewals thereof (collectively the "Contracts"), and 2. all licenses, approvals, authorizations, consents, certificates and permits in connection with the rehabilitation, construction or conversion and operation of the Program which are now in existence or which may exist at any time or times in the future, together with any extensions or renewals thereof (collectively, the "Licenses"), the Sub recipient hereby assigns the Contracts and Licenses to the Corporation, provided, however, the Sub recipient shall enjoy and perform all of its rights and obligations under the Contracts and Licenses until the happening of an event of default. 55

56 Default/Termination In the event of termination of this Agreement for an event of default, the Corporation shall have liens on all of the real and personal property, fixtures, furnishings, equipment, facilities and other property of the Sub recipient and any affiliates of the Sub recipient to the extent of any HOME Funds provided pursuant to this Agreement. The Sub recipient hereby constitutes the Corporation as its attorney-in-fact, coupled with a secured interest, for the purpose of executing and filing all documents and performing all acts necessary to insure that such liens are perfected and effective. The Corporation shall have the right to withhold funds or to direct HUD to withhold funds regardless of the existence of a breach of this Agreement or notice thereof to the Sub recipient if, in the judgment of the Corporation, it is in the best interest of the Corporation to do so. 56

57 Enforcement of the Agreement In accordance with 24 CFR 85.43, suspension or termination may occur if the Sub recipient materially fails to comply with any term of this Agreement or if this Agreement is terminated for convenience in accordance with 24 CFR

58 Duration of the Agreement The term of this Agreement (the "Term") shall commence on this date and shall expire on {Deadline Date}, or upon satisfaction of all indebtedness required to be repaid, whichever occurs later, but in any event shall not expire prior to the end of the period of affordability specified in 24 CFR or 24 CFR , if applicable, and not before the Sub recipient relinquishes control over any HOME Funds provided pursuant to this Agreement. 58

59 Assignment The Sub recipient may not assign any right granted nor delegate any obligation imposed herein without the prior written consent of the Corporation and any purported assignment or delegation without the Corporation's prior written consent shall be void. The Sub recipient will not transfer the controlling interest of the Sub recipient or change any general partner or the controlling interest of any general partner without the prior written approval of the Corporation. For the purpose of this section, a transfer of more than ten (10%) percent ownership interest or a transfer of stock in the Sub recipient, in whole or in part, by a party holding ten (10%) percent or more of the stock of the Sub recipient, or a transfer by more than one stockholder of the Sub recipient of ten (10%) percent or more of the stock of the Sub recipient, or any other similarly significant change in the ownership of such stock or in the relative distribution thereof, or with respect to the parties in control of the Sub recipient, whether by increased capitalization, merger with another corporation, issuance of new or additional stock or by any other methods, shall be deemed a transfer of ownership with respect to this Agreement No assignment of contract unless written approval by HTFC. 59

60 Non-liability 1. Nothing in this Agreement or otherwise shall impose any liability or duty whatsoever on the Corporation or New York State Homes and Community Renewal, including but not limited to any liability for taxes, wages, compensation, benefits, commissions, unemployment insurance, workers compensation, disability benefits, social security or other employee benefits for any person or entity. It is further expressly understood that the any plans, drawings, specifications, financial schedules, or other documents, materials or information accepted by the Corporation or transferred, assigned, provided or otherwise made available to the Sub recipient or any persons in connection with the Program, 2. The feasibility of the Program, whether or not the financial commitments as specified in the Program Budget are provided, or any contractors, suppliers or consultants accepted by the Corporation. The Sub recipient and others, if they make use of or rely on such documents, materials, information or approvals, will do so on their own responsibility and at their own risk. You are responsible! 60

61 Modification This Agreement may not be amended, modified or rescinded unless such amendment, modification or rescission is in writing and signed by the Corporation. 61

62 No Waiver No waiver of any term, provision or condition of this Agreement by the Corporation shall be effective unless the waiver is in writing, signed by the Corporation and delivered to the Sub recipient. No waiver by the Corporation of any term, provision, or condition or of any failure by the Sub recipient to perform any of the terms, provisions, or conditions of this Agreement shall be construed to be a waiver by the Corporation of any other or subsequent breach of any term, provision, or condition or failure to perform any of such terms, provisions, or conditions. 62

63 Miscellaneous 1. All notices or other communications with respect to the subject matter of this Agreement shall be in writing and shall be deemed to have been given when personally delivered or sent by certified mail, return receipt requested, to the parties at the addresses first set out herein or at such other address of which party to receive such notice shall have notified the party giving such notice in writing, except that notice of such change of address shall be deemed to have been given when it is received. 2. No action shall lie or be maintained against the State of New York or the Corporation upon any claim based upon or arising out of this Agreement or the work performed hereunder or anything done in connection herewith unless such action shall be commenced within six (6) months after the termination of this Agreement or one year from the accrual of the cause of action, whichever is earlier. 3. If any provision of this Agreement or the application thereof to any person or circumstances shall to any extent be invalid or unenforceable, the remainder of this Agreement, or the application thereof to persons or circumstances other than those as to which it is invalid or unenforceable, shall not be affected thereby, and each provision shall be valid and enforceable to the fullest extent permitted by law. 4. Any action to be taken or consents to be given by the Corporation hereunder may be taken or given by a representative or agent designated by the Corporation for such purpose. All consents and approvals to be given by the Corporation hereunder must be in writing. 5. The captions and headings of the various sections herein are for convenience only and do not, and shall not be deemed to, define, limit or construe the contents of such sections. 63

64 PLEASE ENJOY A 10 MINUTE BREAK If you have additional questions, please send them to your Regional Program Managers, via . If we get quite a few, we will post FAQ and answers on our website. 64

65 TIMES THEY ARE A CHANGING 43% cut to 2012 HOME Funds 2012 Appropriations Act IDIS changes Increased HUD oversight Shorter time to commit and spend Must be a need for the project in the area Must have capacity, experience to deliver HOME Proposed Rule 65

66 BACK TO THE BASICS Everything we are going to discuss comes directly from our review of your administrative plans Sometimes, we do things because it s the way we ve always done it Sometimes, doing it the way we have always done it does not comply with the HOME regulations 66

67 THE NAMES HAVE BEEN CHANGED TO PROTECT THE INNOCENT! Many of these topics may seem like we are going back to HOME 101 however, we do think it will be helpful to re-iterate HTFC s interpretation of program specific processes to achieve compliance. 67

68 ENVIRONMENTAL REVIEW AND APPROVED ACTIVITIES ERR approves activities based on your program description, as submitted in your application The program description does not account for, when, 15 pages later in the admin plan, it says by the way, we are also going to do HTFC and EAU can not manage this with ease Choose one type of activity and do it well Get site specific approval before you take physical action HTFC will no longer approve requests to transfer funds to units in different program year contracts 68

69 HOUSING REHAB WORK ORDER OF PRIORITY 1. Health and safety issues 2. Items to meet Local Code/NYS CODE After the above, address special purpose needs such as : Energy efficiency Accessibility modifications Weatherization 69

70 OWNER OCCUPIED REHAB HOMEOWNER ELIGIBILITY At the time of application, document that homeowner: Owns the property Is current on mortgage Is current on all property taxes Is current on homeowners insurance Owes no fees to the municipality Foreclosure loan modification agreement must have 6 months of on-time payments, prior to assistance 70

71 SIGN OFF BY BENEFICIARY All housing rehabilitation work paid with HOME funds must be signed off on by the beneficiary of assistance, to include all payments and change orders. Final completion of unit must be signed off on by agency, homeowner and contractor. 71

72 REFINANCING AND SUBOORDINATION HTFC will consider a refinancing request to subordination the HTFC investment for the following reasons: Take advantage of a lower interest rate, no cash out Major medical crisis Major home repair Education expenses 72

73 PROCUREMENT & CONTRACTING 3 bids Widen the pool Document procurement with & fax Qualified contractor list, need to market to MWBE s, so they have a chance to get on the list MWBE, 1 ad in the newspaper is not enough Require a 10% retainage You must have an in-house estimate Lowest responsible bidder that can do the work Additional warranty protection in NYS Need to check to see if contractor is on HUD s debarred list 73

74 MWBE MW: 51% or more owned by minority/women BE: 51% or more owned by minority members, stock holders NYS Empire State Development certified list County/City MWBE list Material suppliers may qualify Widen the pool Make sure your contractors comply LPA s need to document outreach efforts 74

75 SECTION 3 Provide opportunities for training and employment for low income persons living in the project area Provide contracts for work, in connection to the HOME funds awarded, to business concerns that are located in or owned by persons residing in the program service area Section 3 residents = public housing residents or persons who live in area and are under 80% of median 75

76 INCOME DETERMINATION must choose up front which process will use to calculate income and consistent throughout term of contract Choose: Section 8 (Part 5) IRS adjusted gross income Census long form annual income 76

77 CONFLICT OF INTEREST Be sure to properly procure services Newly qualify applicants on waiting lists (new terms for 2012), consider starting a new list Consultants administering the program can t perform every function, separation of duties Look at consultant procurement, if you did not procure up front for consultants to provide energy audits and risk assessments, they can t provide service, also is a fine line regarding personal gain All requests for waivers require documented public disclosure and approval from HTFC and HUD 77

78 ADDING MORE HOME FUNDS AFTER PROJECT COMPLETION Reinvestment in a unit is only eligible for 1 year from the date of project Completion in IDIS Funds reinvested should be used to go back in to take care of issues related to the work that was previously done on the unit After 1 year from completion, can t assist with additional HOME funds until the period of affordability has expired 78

79 WHAT ARE ELIGBLE PROJECT RELATED SOFT COSTS, AKA PROJECT DELIVERY EXPENSES? Costs that are directly attributed to production of a unit of affordable housing, always categorized as projectrelated soft costs (project delivery) rather than administrative costs. Project delivery is directly tied to the unit. These costs are added into the per unit total of HOME funds invested. 79

80 ELIGIBLE PROJECT DELIVERY EXPENSES architectural, engineering or related professional services required to prepare plans, drawings, or specifications of a project costs to process and settle the financing for a project, such as: private lender origination fees credit reports fees for title evidence fees for recordation and filing of legal documents building permits attorney s fees private appraisal fees fees for an independent cost estimates builders or developers fees costs of a project audit, if requested by the PJ with respect to the development of the project an initial operating deficit reserve which is a reserve to meet any shortfall in project income during the period of rent-up (of a new construction or rehabilitation project) and which may only be used to pay operating expenses, scheduled payments to replacement reserves, and debt service. impact fees that are charged for all projects within a jurisdiction 80

81 REQUESTS FOR ADMINISTRATIVE FUNDS HTFC can not pay for work that has not been completed Request for payment of administrative funds must be within 10% of project cost expenditure No advance or up front payments 81

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87 OTHER FEDERAL REQUIREMENTS FORMS - TEMPLATES _offices/comm_planning/affordablehousing/lawsand regs/fedreq (Other Federal Requirements) _offices/comm_planning/affordablehousing/library/f orms (HOME Forms, Checklists) _offices/comm_planning/affordablehousing/training /web/leadsafe/usefulforms (Useful Forms) 87

88 COPIES OF POWERPOINT SEND US YOUR QUESTIONS We will post Powerpoint and outline version on our website in a week If there are questions we can t get to today, please send them to your Regional Program Managers, we will compile answers and post FAQ on website 88

89 QUESTIONS? Let s finish with a story and a challenge 89