AGENDA # 1d
MEMORANDUM
TO: Mayor and Town Council
FROM: W. Calvin Horton, Town Manager
SUBJECT: Proposed 2001–2002 HOME Program
DATE: March 28, 2001
The purpose of tonight’s public hearing is to receive citizen comments on a proposed plan developed by the HOME Program Review Committee for use of HOME Program funds for fiscal year 2001–2002.
The U.S. Department of Housing and Urban Development has awarded the Orange County HOME Consortium $483,000 for fiscal year 2001-2002. In addition, the participating municipalities are required to contribute a total 25% match of the grant funds after subtracting administration costs of $48,300. The total match requirement is $108,675. The Town’s contribution to matching fund is 41% or $44,557. Orange County, Carrboro and Hillsborough will contribute $45,644, $13,041 and $5,434 respectively. In addition, we propose to reprogram $130,250 of 2000–2001 HOME Program funds. Therefore including Administration, the Council will be planning activities for a total of $721,925.
SUMMARY
The HOME Program Review Committee proposes the following use of 2001–2002 HOME Program funds:
Town of Chapel Hill (Transitional Housing) $100,000
Orange-Person-Chatham Mental Health Assoc. $ 58,625
EmPOWERment, Inc. $ 50,000
Orange Community Housing Corporation $ 30,000
Habitat for Humanity $ 20,000
Administration: Orange County Housing and Comm. Dev. $ 48,300
Total $721,925
As in previous years, we propose to use funds available in the Housing Loan Trust Fund for the Town’s match contribution.
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 low-cost housing. That year, the Consortium received $803,600 through the State’s HOME Program.
Since 1995, the Consortium has received funds directly from the Department of Housing and Urban Development through the federal HOME Program. Please see Attachment 1 for a summary of federal HOME Program funding.
Please see Attachment 2 for a summary of 2000-2001 HOME Program Activities.
On May 15, 2000, the Town and Orange County submitted to the U.S. Department of Housing and Urban Development a five-year Consolidated Plan covering fiscal years 2000–2001 through 2004–2005. The purpose of the Plan is to identify and prioritize housing and community development needs for Chapel Hill and Orange County. The Plan also suggests how the Town and the County will address needs over a five-year period.
The Plan also included a 2000-2001 Community Development plan and a 2000–2001 HOME Program approved by the Council, the Orange County Commissioners, and the Hillsborough and Carrboro Boards of Aldermen.
On January 23, 2001 the Council held the first public hearing to receive ideas from citizens about how funds should be used in five areas: the Capital Improvements Program, the Town Budget, the Community Development Program, the HOME Program and the Comprehensive Grant. On February 6, 2001, the Orange County Commissioners held a public hearing to receive citizen comments on how HOME Program funds could be spent.
Please see Attachment 3 for a summary of applications received for HOME Program funding.
For your reference, we have attached a list of eligible HOME Program activities (Please see Attachment 4).
In addition to $483,000 of 2001–2002 HOME Program funds, $130,250 of 2000–2001 HOME Program funds are also available. These funds were budgeted for the Abundant Life / Seeds of Sheba Center to renovate its building on West Rosemary Street. The organization withdrew its request for HOME Program funding; therefore we recommend reprogramming these funds.
On October 23, 2000, the Council passed 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.
The Committee is comprised of one elected official from each jurisdiction from each participating government and the Manager or his designee. The Council appointed Council Member Edith Wiggins to represent the Town Council. Assistant Town Manager Florentine Miller and Community Development Coordinator Loryn Barnes also attend Committee meetings. Other representatives attending the meetings are: Orange County Commissioner Margaret Brown and Housing and Community Development Director Tara Fikes; Carrboro Alderman Jacqueline Gist and Community and Economic Development Director James Harris; and Hillsborough Commissioner Kenneth Chavious and Planning Director Margaret Hauth.
DISCUSSION
The HOME Program Review Committee proposes the following one-year plan for 2001–2002:
Property Acquisition / Rehabilitation: $343,625
Land Acquisition: $130,000
New Construction: $100,000
Homebuyer Assistance: $100,000
The Committee proposes to budget $100,000 of HOME Program funds to EmPOWERment, Inc. to provide second mortgage assistance to households throughout Orange County. Eligible activities must serve households earning less than 80% of the HUD published area median income.
Administration: $48,300
The remaining $48,300 would be allocated to the Orange County Housing and Community Development Department for administration of the HOME program.
All comments received during tonight’s public hearing and the comment period will be summarized and submitted with the Consolidated Plan to the Department of Housing and Urban Development. The Housing and Community Development Advisory Board is scheduled to review the proposed plan on March 27, 2001. We will forward the Board’s recommendation to the Council at the March 28, 2001 public hearing.
We will submit a final recommended HOME Program plan to the Council for consideration on April 23, 2001. The governing boards of Orange County, Carrboro and Hillsborough will also consider the proposed plan prior to submitting the Consolidated Plan to the Department of Housing and Urban Development on May 15, 2001.
ATTACHMENTS
1. Summary of HOME Program funding since 1995 (p. 6).
2. Summary of 2000–2001 HOME Program Activities (p. 7).
3. Summary of Applications for 2001–2002 HOME Program Funding (p. 9).
4. Eligible HOME Program Activities (p. 11).
ATTACHMENT 1
· In 1995-96, the Consortium received $368,000 from the federal HOME Program and $132,000 of State HOME funds. The four municipalities contributed a total of $112,500 in matching funds. The Town contributed $46,125 (41%) of this local match.
· In 1996-97, the Consortium received $386,000 of federal HOME funds. The municipalities contributed a total of $96,500 in matching funds; the Town contributed $39,565 of this amount.
· In 1997-98, the Consortium received $379,000 of federal HOME Program funds. As a result of Hurricane Fran in September 1996, the local match was waived for counties that were declared a disaster by a Presidential declaration.
· In 1998, the Consortium received $403,000 of HOME Program funds. The municipalities contributed $90,675 in matching funds for the program; Chapel Hill contributed $37,177.
· In 1999, the Consortium received $437,000 of federal HOME Program funds. The municipalities contributed $98,325 in matching funds for the program. The Town contributed $40,313 of this amount.
· In 2000, the Consortium received $438,000 for fiscal year 2000-2001. The municipalities contributed $98,550 in matching funds for the program. The Town’s contribution to matching fund was $40,406.
ATTACHMENT 2
2000–2001 HOME Program
(Adopted by the Chapel Hill Town Council, Orange County Board of Commissioners, Carrboro Aldermen and the Hillsborough Board of Commissioners)
Property Acquisition / Rehabilitation: $120,000
The Consortium allocated $120,000 to Orange Person Chatham Mental Health Area Program to acquire and if necessary rehabilitate houses in Orange County for persons with disabilities.
Rehabilitation: $130,250
The Consortium budgeted $30,000 for the Orange Community Housing Corporation to continue operation of the Urgent Repair Program. Eligible properties must have repair needs that pose a threat to the life, safety, or health of the occupants, or need accessibility modifications for a disabled occupant.
The remaining $100,250 was budgeted to the Abundant Life Center, a single room occupancy facility, to renovate its building on West Rosemary Street. This application for funding was withdrawn by the Abundant Life Center. A process for reprogramming these funds is underway.
Community Revitalization: $100,000
The Consortium budgeted $100,000 of HOME Program funds to continue revitalization efforts throughout Orange County. Eligible activities must serve households earning less than 70% of the HUD published area median income. Funds could be used for second mortgage assistance, property acquisition and rehabilitation. A qualified 501(c )(3) organization would be eligible to use these funds.
New Construction: $80,000
The Consortium budget $80,000 to the Orange Community Housing Corporation to construct thirty-two affordable townhomes in Meadowmont. The townhomes will be sold to first time homebuyers earning less than 80% of the area median income. Funds would be used for site development expenses. We also recommend that the Council budget $80,000 of Community Development funds for this project in 2000–2001. The Consortium recommends that the Council budget an additional $80,000 of 2001–2002 HOME Program funds for the development of this project.
New Construction: $62,500
The Consortium budgeted $62,500 to Habitat for Humanity to construct five homes in Orange County. The funds will be converted into permanent second mortgages for the homebuyers. The homes will be sold to families earning less than 50% of the area median income. If a home was sold or ownership of a home was transferred, the owner would be required to repay the second mortgage to the HOME Program.
Administration: $43,800
The remaining $43,800 would be appropriated to the Orange County Housing and Community Development Department for administration of the HOME program, as allowed by HUD.
ATTACHMENT 3
1) Town of Carrboro
The Town of Carrboro requests $135,000 of HOME Program funds to purchase three two-bedroom units in Old Well. The properties would be renovated and sold to first-time homebuyer units or made available as rental units for families earning less than 80% of the area median income.
2) Chapel Hill Department of Housing
The Chapel Hill Department of Housing requests $100,000 of HOME Program funds to develop a transitional rental housing program for public housing residents. The program would be a stepping-stone for families between public housing and the private housing market. Funds would be used to purchase a house in Chapel Hill.
3) Community Land Trust in Orange County / Orange Community Housing Corporation
The Land Trust, in conjunction with the Orange Community Housing Corporation and Habitat for Humanity, requests $30,000 to purchase land for two homes on Dillard Street in Carrboro. EmPOWERment would renovate the two homes that would then be sold to first-time homebuyers earning approximately 70% of the area median income. Both homes would be placed in the land trust.
4) EmPOWERment, Inc.
EmPOWERment requests $50,000 to provide soft second mortgages on properties in Hillsborough and unincorporated Orange County. EmPOWERment proposes to assist 8 – 10 homebuyers with these funds.
5) EmPOWERment, Inc.
EmPOWERment requests $50,000 to provide soft second mortgages to its homebuyers in the Chapel Hill and Carrboro area.
6) EmPOWERment, Inc.
EmPOWERment requests $50,000 of HOME program funds to purchase approximately 5 low-cost condominiums in Orange County. The properties would be used for affordable rental housing.
7) Habitat for Humanity
Habitat for Humanity, in cooperation with the Orange Community Housing Corporation, the Community Land Trust in Orange County, and EmPOWERment, Inc. requests $150,000 of HOME Program funds to be set aside to create a fund for land acquisition and the development of affordable housing. The funds would be accessible to any non-profit housing provider of affordable housing.
8) Habitat for Humanity
Habitat also requests a $20,000 grant of HOME Program funds to pay for the extension of a sewer to a lot owned by the Community Land Trust in Orange County. Habitat intends to build a house on this lot that would be sold to a lower income family earning less than 50% of the area median income.
9) Orange Community Housing Corporation
The Orange Community Housing Corporation requests $80,000 of HOME Program funds to develop 32 affordable condominiums in the Meadowmont development. The two- and three-bedroom condominiums would be sold to first-time homebuyers earning less than 80% of the area median income.
10) Orange Person Chatham Mental Health Association
Orange Person Chatham Mental Health Association requests $100,000 to acquire and, if necessary, renovate properties for its clients with severe disabilities earning below 30% of the area median income. The Association proposes to use funds to create 2 single occupancy efficiency units.
11) Pines Community Center, Inc.
The Pines Community Center, Inc. requests $171,250 of HOME Program funds to create 18–21 lots of affordable housing on property it owns on Park Road. The Center proposes to develop detached homes, multi-family units and two story units on the property.
12) Residential Services, Inc.
Residential Services, Inc requests $212,500 of HOME Program funds for initial project costs of a continuing care facility including acquisition of land, fees, improvements, and architectural and planning costs.
ATTACHMENT 4
The HOME PROGRAM
In 1990, Congress enacted the HOME Investment Partnerships Act, better known as the HOME Program, in an effort to provide a new approach to housing assistance at the federal level. This federal housing block grant would afford state and local governments the flexibility to find a wide range of housing activities through creative and unique housing partnerships among states and localities, private industry, and nonprofit organizations.
In order to receive future HOME Program funds, each housing activity must fall in line with the following goals of the HOME Program:
1. To expand the supply of decent, safe, sanitary and affordable housing, with emphasis on rental housing, for very low- and low-income citizens;
2. To strengthen the abilities of state and local governments to design and implement strategies for achieving adequate supplies of decent affordable housing; and
3. To encourage public, private and nonprofit partnerships in addressing housing needs.
Eligible activities for HOME Program funding include (from the Federal Regulations):
· acquisition of property (including assistance to homebuyers)
· new construction
· reconstruction
· conversions
· moderate rehabilitation of non-luxury housing with suitable amenities
· tenant-based rental assistance
· relocation of displaced persons, families, businesses, or organizations
· site improvements, acquisition of vacant land and demolition (under special conditions)
· project soft costs
· administration / planning
· operating expenses for community housing development organizations