Last week, the Delaware State Housing Authority (DSHA) hosted a three-part feedback session on the three set-asides of the Housing Development Fund (HDF) funds in Dover, Delaware.  The Delaware State Housing Authority (DSHA) noted that new HDF applications to be posted shortly, will provide more detail  for applicants such as documentation needed, point scale, leveraging, etc.  Applications are scored and ranked by the Delaware State Housing Authority (DSHA)  and sent to the Council on Housing (COH) Loan Review Committee. Below is a description of each set-aside and some feedback provided by the attendees.

Housing Development Fund (HDF) Housing Grants: This grant is for acquisition/rehabilitation or new construction of housing units or repair of housing units by non-profit sponsors (not for rental properties), with a set-aside of $750,000, standard semi-annual estimate.  At least 75% of units must be at or below 80% Area Median Income (AMI) and each housing unit is limited to a maximum of $35,000.  For new construction projects, at least 75% of the funds must provide an affordability gap between the appraised value and sales price of the property.  For acquisition/rehabilitation projects, at least 50% of the funds must provide an affordability gap between the appraised value and sales price of the property.  Affordability periods for homebuyers using homeownership gap financing must be for a minimum of 10 years.

Since January 31, 2010, the HDF Housing Grant has served 360 homeowners by funding a total of 9 projects and 1 program in the amount of $1,994,484.

Attendee Feedback:

• Do not view housing from an equity prospective as the affordable housing market is similar to the depressed regular housing market;
• Focus on affordability from buyer’s perspective;
• Conduct all compliance audits for multi-grant recipients at same time;
• Allow all offices to accept applications (DSHA staff stated that this change was in the works);
• Collaborate with other housing authorities in Delaware to come up with strategies for funding, projects, etc.;
• Use of grant money for a land trust model to offset land cost;
• Consider means of transportation when developing projects and include in point system when ranking applications;
• Many developers are focusing on Neighborhood Stabilization Plan (NSP) funds due to quick turnaround, 100% funding, and no risk.  Additionally, developers are concentrating on neighborhood revitalization and community development instead of construction.

HDF Program Support Grants: This grant is for administration of housing related activities by nonprofit sponsors, with a set-aside of $500,000 (increased from $250,000), standard semi-annual estimate. The grant is not eligible for direct lending or gap financing for homebuyer and at least 50% of the program budget must come from other non-HDF sources.

Since January 31, 2010, the HDF Program Support Grant has served over 162 households by funding 4 programs in the amount of $313,023.

Attendee Feedback:

• Decrease amount of funding required from non-HDF sources;
• Use of grants for homelessness assistance- currently there is a lack of permanent supportive housing;
• Help citizens that are in need of housing and have low credit scores due to foreclosure;
• Consider means of transportation when developing projects and include in point system when ranking applications;

HDF Loan Fund (formerly known as the Non-Tax Credit Loans): These funds are for the production of housing units by profit and non-profit sponsors.  Funds can be used to rehabilitate projects where there is no change of ownership.  There is a set-aside of $750,000, standard semi-annual estimate.  Each housing unit is limited to a maximum of $35,000 or appraised value for special needs projects.

The HDF Loan Fund has funded one program to date.

Attendee Feedback:

• Consider means of transportation when developing projects and include in point system when ranking applications;