LIFT Homeownership Funding 2021 Notice of Availability Training
NOFA process and key details for the LIFT Homeownership program in 2021. Learn about funding availability, application deadlines, rural and urban area definitions, funding distribution, and important definitions related to the program.
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Presentation Transcript
LIFT Homeownership 2021 Notice of Funding Availability (NOFA) Training January 27, 2021
Agenda Welcome Dates to Remember LIFT Program Overview Application Details Application Reviews/Scoring General Reminders Questions
NOFA Process: FAQs/Dates to Remember Questions should be submitted to: HONOFA@oregon.gov Request Procorem access on or before: February 3, 2021 Questions accepted until: March 12, 2021 Application due date: March 24, 2021 FAQs will be published at regular intervals
Rural Definition Communities with population of 15,000 or less outside of the Portland Urban Growth Boundary in counties within Metropolitan Statistical Areas(Benton, Clackamas, Columbia, Deschutes, Jackson, Josephine, Linn, Marion, Multnomah, Polk, Washington, and Yamhill Counties), or Communities with 40,000 population or less in the balance of the state Note: If a city was eligible to be considered Rural by population within the same dataset and currently has a population that is within 5%(five percent) of the established rural definition for this NOFA, they can be considered Rural for the purposes of this application.
Urban Areas Definition An eligible category for receiving LIFT funds through this NOFA which serve all other areas in Oregon that aren t included in the Rural Areas definition. All Communities within the Portland Urban Growth Boundary are considered Urban and not considered Rural regardless of size.
Definitions Affirmatively Furthering Fair Housing Communities of Color Culturally Responsive Organizations Culturally Responsive Services Culturally Specific Organization
Funding $16,625,000 in Article XI-Q bond proceeds Soft Set-Aside, 50% ($8,312,500) to projects in rural areas and 50% ($8,312,500) to projects in urban areas
Funding Limits Applications may request a LIFT subsidy up to the LESSER of: The value of the land plus infrastructure/site-work (excluding housing structures), verified through an as-built appraisal, assessed value, or real market value OR $100,000 per LIFT homeownership unit
Land Valuation/Loan Request The requested LIFT funding amount must be supported at the time of the Application, by a valuation of the land or by a valuation of the land including its infrastructure (excluding housing structures). If an appraisal is not able to be provided in time for the Application due date, Applicants may submit, as evidence of the land valuation, the real market value or assessed value of the land as of the time of the Application.
Land Valuation/Loan Request An Applicant may request a LIFT loan amount (not to exceed $100,000/unit) greater than the rea l market value or assessed value of the land if the Applicant believes that the appraised value of the land will exceed the real market value or assessed value. If the request for funding exceeds the provided valuation, the Applicant must guarantee to cover any gap with cash or a loan if the final land valuation is not high enough to cover the entire requested funds. Documentation of the availability of the gap coverage must be submitted at the time of the Application (a commitment letter or LOI).
Application Ranking LIFT Funds are reserved by OHCS on a competitive basis to Projects of qualifying Applicants that: 1. 2. 3. Committee in accordance with available funding, subject to prioritization of qualifying Projects Pass the Preliminary Review; Meet the Threshold Requirements; and Have the highest-ranking score from the Scoring
Eligible Projects LIFT funds in this NOFA are for new construction of affordable homeownership housing units or the conversion of existing non-housing structures into new affordable homeownership housing units.
Ineligible Projects Developments that are under construction (including site work) at the time of application are not eligible for funding through this NOFA. Developments that begin construction after LIFT Reservation and before LIFT Loan Closing may have their LIFT Reservation rescinded. Projects aiming to rehabilitate existing residential structures or housing units are not eligible for funding through this NOFA.
Program Overview Affordability Period: minimum of 20 years OR the length of the Bonds outstanding Loans satisfied through repayment or extended affordability Incomes: all LIFT units must be available for households earning 80% or less area median income; at the time of the sale and any subsequent re-sales for the duration of the affordability period.
Program Overview Construction Standards: both traditional and alternative allowable; quality; durability (30 year standard) Development Period: units must be ready for initial sale within 36 months of LIFT reservation Profit: profit from the sale of homes in the Project may not exceed 7% of the total Project costs and may not increase above what was included in the Application.
Service to Communities of Color All Projects funded with LIFT must include service to Communities of Color. This can be achieved in a number of ways and should be relevant to the community in which the Project is located and the target population anticipated to be served. Any approach that is chosen must include intentional engagement with Communities of Color for services planning for the development.
Underwriting Guidelines Financing identified and available for the Project development; Letter of Interest (LOI) from a construction lender for overall Project; Project construction schedule supports that all homes in the Project will be ready for sale within 36 months of the Reservation Letter; Demonstrate that the Applicant has done due diligence and that potential lenders exist, include corresponding down payment / terms for initial and future home buyers. This is based on the Applicant s narrative response describing the mortgage market; Demonstrate experience or understanding in running a land lease or applicable association to ensure on-going compliance with the affordability requirements;
Underwriting Guidelines Demonstrate knowledge and evidence of the market for the Project to income eligible households (previous history, waitlist, community/regional homeownership market trends, etc.); Evidence that the current land zoning allows for the proposed Project; need for a zoning change is not allowed given time constraints of LIFT program; Valuation of land that justifies LIFT investment, as demonstrated by third party appraisal or as otherwise described in this NOFA Construction costs estimated based on thorough and defensible methods;
Underwriting Guidelines The information submitted must clearly show a need for LIFT funds; For Projects that include more than 4 units, a Phase I study is required prior to closing. If a project has 4 units or less, the project sponsor can choose to opt out of a Phase I study and instead certify that the sponsor will not request additional funds from OHCS to mitigate issues found before, during, and/or after construction and during operation that would have been discovered by a Phase I; and Application of prevailing wage requirements to the Project (BOLI), if applicable
Compliance Monitoring 1. Initial household income verification at home or unit purchase. 2. Subsequent sales of any home or unit during the affordability period will require verification of homebuyer income. 3. Regular or as needed verification of owner/homeowner/condominium association compliance with the Program Requirements. 4. Annual report on the Project s reserve fund and association s finances. 5. Annual notification of any homeowner or unit owner in arrears (of association assessments, property taxes, insurance, etc.) and a corresponding action plan of either the owner or the association. 6. Verification of appropriate maintenance and repair by the party responsible for the Project.
Other Program Requirements Fee simple interest: LIFT funds will be loaned to qualifying Applicants that possess an undivided fee simple interest in the land First lien deed of trust Payment at end of affordability period/extension of affordability period Operational interest
Application Access/Submission For the first time, access to the application materials will only be available via Procorem instead of being generally available on our webpage. In order to gain access to Procorem, Applicants must send an email to HONOFA@oregon.gov no later than February 3, 2021, requesting access. If credentials are not requested by the above date, Applicants will not be able to access the Procorem portal for application access. Applications must be uploaded into the Procorem portal by no later than March 24, 2021 at 4:00 PM PST.
Procorem Resources Procorem Work Center Training Webinar: https://register.gotowebinar.com/recording/8244073718771 606023 Fill out the registration page to view the webinar Send an email to HONOFA@Oregon.gov
Application Updates Excel Based Application Incorporating previously disconnected application components with tabs separating application into various subject matter categories Pay particular attention to the initial Instructions Tab. Do not attempt to change or modify any cells or formulas risk of application failure You may not copy the application to use with a different LIFT Homeownership project. Each application is specifically attached to a Workcenter and a project. You must submit a new application for each project you are applying for.
Application Updates Tabs for different narrative questions Development Team tab Includes Development Schedule & Development Team Capacity Competitive Scoring tab Will automatically calculate based on Application data Subsidy Layering (Total LIFT Subsidy vs total units) Cost Containment (RS Means data)
Application Charges All Applicants must submit application charges via mail. OHCS cannot accept any electronic payments for Application charges. Applicants must submit the Application charges to OHCS along with the transmittal form provided as part of the application materials: Oregon Housing and Community Services Attn: Affordable Rental Housing NOFA #2021-3 725 Summer St. NE, Suite B Salem, OR 97301 All Application charges must be postmarked no later than the Application Deadline.
Preliminary Review NOFA Excel Application (Plus all Documents per Instructions Tab) Required Application Forms LIFT Homeownership Application Forms Includes Applicant Agreement, Authorization and Acceptance Form, Ownership Integrity Form, DEI (Diversity, Equity, and Inclusion) Agreement Project Site Review Checklist Zoning Form Organizational Documents
Threshold Review Readiness to Proceed Development Team Capacity: construction experience, financing experience, development team experience, financial capacity Financial Viability Ownership Integrity Service to Communities of Color MWESB Outreach Strategies
Competitive Review Based on the Narrative Questions as well as supporting documentation submitted as part of threshold scoring: Financial Viability: 10 points Readiness to Proceed: 15 points LIFT subsidy and Costs: 26 points Innovation, Efficiency, Replicability: 9 points Capacity: 20 points Service to Communities of Color, MWESB: 20 points Project Located in a Federally Declared Wildfire Disaster Area: 5 points
Competitive Scoring Financial Viability: 10 points Based on Financial Assumptions tab, Sources & Uses Tab, and required Exhibits; Scored internally by underwriting staff Readiness to Proceed: 15 points Based Readiness to Proceed under Competitive Scoring tab Scored internally by underwriting staff LIFT subsidy and Costs: 26 points Based on project data submitted on NOFA application. Scored internally by data scoring group Partnerships, Innovation, Capacity: 49 points Based on Narrative questions on NOFA application Scored by External / Internal Committees
Tips for Narrative Responses Do not assume that the reader is familiar with your organization External reviewers do not have access to your complete application; They will only have access to the NOFA Application, no exhibits. Use the project description on the NOFA Narrative Questions tab to establish a general overview of the project. Explain acronyms Not all reviewers will be subject area experts in homeownership or development; demonstrate expertise and provide high level overviews of concepts.
MWESB Engagement Strategy Tab Narrative to address Applicant s strategy to increase the use of Minority, Women and Emerging Small Business (MWESB) contracting, sub-contracting, and professional services (5 points)
NOFA Narrative Questions Tab Project Narrative/Project Description Demonstration of innovation, efficiency, and replicability of building development or finance strategy (9 points) Demonstration of capacity of the development team; understanding of development dynamics (up to 10 points) Demonstration of capacity of management group (up to 10 points). Cost Containment Justification for RS Means selection on Competitive Scoring Tab
Urban or Rural Narrative Questions Tab Fill out corresponding tab based on Community type that the project is targeting Either Urban or Rural. Service to communities of color (15 points) If a scattered site project in both Rural AND Urban Communities, please fill out each tab appropriately.
General Application Reminders Ensure that the application forms are signed before uploading Follow the document naming convention referenced on the instructions tab completely and accurately Make sure to provide all requested material in the correct folder in Procorem
General Application Reminders Keep responses within the stated length in the application Define acronyms used by your organization Answer questions completely. Don t assume the reader is familiar with your organization or project Submit only the documents/attachments that are listed on the instruction tab Always mark the project location on maps and context photos
Application Submission Reminders Request access Procorem, by sending an email to HONOFA@oregon.gov no later than February 3, 2021 Applications must be uploaded into the Procorem portal by no later than March 24, 2021 at 4:00 PM PST Payments for application charges must be postmarked by no later than March 24, 2021. Last day to submit FAQs to HONOFA@oregon.gov is March 12, 2021
