AGENDA #9b
MEMORANDUM
TO: Mayor and Town Council
FROM: W. Calvin Horton, Town Manager
SUBJECT: Recommended 2006-2007 HOME Program
DATE: April 24, 2006
PURPOSE
The purpose of this memorandum is to present to the Council a recommended 2006-2007 HOME Program Plan.
The attached resolution would:
(1) Approve a plan developed by the HOME Program Review Committee for use of $950,580 of 2006-2007 HOME Program funds;
(2) Reallocate $100,000 of funds previously allocated to the Town of Hillsborough for a joint affordable housing project with Habitat for Humanity; and
(3) Authorize this plan to be incorporated into the Annual Update to the 2005-2010 Consolidated Plan developed with Orange County, Hillsborough and Carrboro for submittal to the U.S. Department of Housing and Urban Development on May 15, 200 6.
Funding
At the March 22, 2006 public hearing, we presented to the Council a preliminary proposal for the 2006-2007 HOME program. We recommend no changes to that proposal.
The U.S. Department of Housing and Urban Development has awarded the Orange County HOME Consortium $665,560 for fiscal year 2006-2007. In addition, the participating municipalities are required to contribute a 25 percent match of the grant funds after subtracting administration costs of $66,550. The total match requirement is $149,750. The Town’s contribution to the matching funds is 41percent or $61,400. As in previous years, funds are available in the Housing Loan Trust Fund for the Town’s match contribution. Orange County, Carrboro and Hillsborough will contribute $59,900, $20,960 and $7,490 respectively. The Consortium also proposes to allocate $135,270 of program income for eligible activities. Grant funds including program administration allocated to the Orange County Department of Housing and Community Development ($665,560), the required local match ($149,750), and program income ($135,270), funds available to the Consortium would total $950,580.
The Committee also proposes to reallocate $100,000 of funds previously allocated to the Town of Hillsborough for property acquisition for Infrastructure Development for a joint affordable housing project with Habitat for Humanity in the Fairview neighborhood in Hillsborough.
On October 23, 2000, the Council adopted a resolution to participate in a HOME Program Review Committee along with Orange County, Carrboro and Hillsborough. The purpose of this Committee is to allow elected officials to have more involvement in the development of the annual HOME Program plan and to review the progress of HOME funded activities on a regular basis. On February 13, 2006, the Council appointed Council Member Laurin Easthom to represent the Town Council.
RECOMMENDED PLAN
The HOME Program Review Committee proposes the following use of 2006-2007 HOME Program:
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1. Homeownership Assistance |
Orange Community Housing and |
$120,000 |
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EmPOWERment, Inc. |
$159,000 |
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2. New Construction |
Habitat for Humanity |
$240,000 |
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Habitat for Humanity |
$250,000 |
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3. Acquisition |
Chrysalis Foundation |
$100,020 |
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4. Operational Support |
Orange Community Housing and |
$ 15,000 |
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5. Administration |
Orange County Housing |
$ 66,560 |
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TOTAL |
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$950,580 |
As in previous years, we propose to use funds available in the Housing Loan Trust Fund for the Town’s match contribution of $61,400. There are currently funds available for this purpose.
BACKGROUND
The HOME Program was established to provide nationwide funding for various types of housing programs to benefit low-income families. This funding is in addition to the existing federal Community Development grants, rental assistance through the Section 8 Program and public housing operating and improvement funding. In 1992, Chapel Hill, Carrboro, Hillsborough and Orange County formed the Orange County HOME Consortium with Orange County acting as the lead entity. The Consortium was established as a local partnership to develop affordable housing throughout Orange County.
Please see Attachment 1 for a summary of 2004-2005 HOME Program Activities.
Relationship to the Consolidated Plan
In May 2005, the Orange County HOME Consortium consisting of the Town, Orange County, Carrboro and Hillsborough submitted a new Consolidated Plan to the U.S. Department of Housing and Urban Development covering fiscal years 2005-2006 thorough 2009-2010. The Plan identifies and prioritizes the housing and community development needs for Chapel Hill and Orange County, and suggests how the Town and the County will address the needs over a five-year period.
The Annual Update to the Consolidated Plan includes a 2006-2007 Community Development and HOME Program Plan, establishes priorities for use of funds, and describes housing and community development initiatives and programs in Orange County. The Community Development Plan is approved by the Council and the HOME Program Plan is approved by the governing bodies of the HOME Program Consortium: the Council, the Orange County and Hillsborough Commissioners, and Carrboro Board of Aldermen. A draft Consolidated Plan is on tonight’s agenda for the Council’s consideration.
On January 25, 2006, the Council held the first public hearing to receive ideas from citizens about how funds should be used in five related areas: the Town Budget, the Capital Improvements Program, the Community Development Program, the HOME Program and the Comprehensive Grant. On February 9, 2006, the Orange County Commissioners held a public hearing to receive citizen comments on how HOME Program funds could be spent and affordable housing needs in general.
Please see Attachment 2 for a summary of applications and comments received at the public hearing and applications received for HOME Program funding.
For your reference, we have attached a list of eligible HOME Program activities (please see Attachment 3).
DISCUSSION
1. Homeownership/Downpayment Assistance: $279,000
The Review Committee proposes to allocate funds to the following agencies for homeownership assistance:
2. New Construction: $490,000
The Committee recommends allocating $490,000 to Habitat for Humanity for two projects:
3. Acquisition: $100,020
The Committee recommends allocating $100,020 to the Chrysalis Foundation to acquire and renovate (or build new) four small apartments for the purpose of providing permanent housing to homeless disabled adults.
4. Operational Support: $15,000
The Committee recommends allocating $15,000 to Orange Community Housing and Land Trust for administrative expenses related to its HOME Program funded projects. As a designated Community Housing Development Organization for the HOME Program, the Land Trust is eligible to receive funds for administration of a housing program.
5. Administration: $66,560
The remaining $66,560 would be allocated to the Orange County Housing and Community Development Department for administration of the HOME program.
Housing projects funded with Orange County HOME Program funds are subject to the County’s 99-year long-term affordability policy, and must remain affordable for 99 years. Orange County records deed restrictions on the property with the Register of Deeds for affordable housing projects.
RECOMMENDATION
That the Council adopt the attached resolution authorizing submittal of the 2006-2007 HOME Program Plan.
ATTACHMENTS
1. Summary of 2005–2006 HOME Program Activities (p. 7).
2. Summary of Applications and Comments for 2006-2007 HOME Program Funding (p. 8).
3. Eligible HOME Program Activities (p. 10).