HOPE VI Main Street Grants Contact Lawrence Gnessin Office of Public Housing Investments, Washington, DC (202) Visit HUD’s Main Street Website at pe6/grants/mainstreet/

2 Purposes To provide needed funds for Main Street rejuvenation efforts; To provide affordable housing within the Main Street rejuvenation effort; As initial funding or gap financing to reconfigure obsolete office/commercial space into income producing rental housing. As gap financing or initial funding of affordable housing development, etc.

3 Amount and Eligibility Up to $1,000,000 Limited to smaller communities. A smaller community must have a population of 50,000 or fewer; and Must have 100 or less physical public housing units within its jurisdiction. Only local governments may apply. Any other organization or property owner interested has to team with their local town, city, county\parish, etc.

4 Application for Grant Applications are being funded via the competitive Notice of Funding Availability (“NOFA”) process. This year’s NOFA was published in the Federal Register on June 29, Applications are submitted electronically and must be received and verified as received at Grants.gov by August 29, 2007, 11:59:59 pm. Visit HUD’s Grants page, which has links to documents that explain how to register and submit an application through Grants.gov, at:

5 NOT Public Housing Main Street units are NOT public housing. HUD’s public housing regulations do NOT apply to Main Street units. HUD’s public housing regulations and HOPE VI guidance may be used as resource materials. Examples: HOPE VI allows unique rent structures and mixed-income development. Public housing shows the adjustments to determine Adjusted Gross Income

6 Affordable Housing Initial residents must be low- income. Low-income is defined as a resident (or family) having an adjusted gross income of 80% or less of the Area Median Income (HUD has published income limits), and: Residents must contribute no more than 30% of their Adjusted Gross Income to rent, and must generally have the same lease rights as public housing residents, e.g., eviction; pets; decent, safe, and sanitary housing, etc.

7 Limit to Affordable Housing For HUD’s Main Street program, the term `affordable housing’ applies only to the initial residents of the new housing units. Initial rental or homeownership is limited to low- income residents with a portion of units reserved for very low-income residents. The grantee (town, city, county/parish) determines if there will be any affordability requirements beyond the initial residency. Units may become market rate after the initial resident moves out.

8 Use of Grant Funds Grant funds and a mandatory 5% Applicant Match (in cash or in-kind services) MUST be used only on eligible affordable housing activities in connection with an eligible Main Street rejuvenation effort, i.e., the housing units presented in the application. Leverage funds do not have this restriction and may be attributable to any Main Street project activities. Visit HUD’s Main Street page at: grants/mainstreet/ for further Main Street program information. grants/mainstreet/

9 Property Ownership Main Street Affordable Housing Projects may belong to private owners, partnerships, corporations, local governments, Main Street organizations, non-profits, etc. Property cannot be sold during the grant term. Donation for $1, long-term leases and other exceptions are allowed by the NOFA.

10 Eligible Main Street Rejuvenation Effort (Main Street Project) There must be an existing Main Street rejuvenation effort; HUD determines whether a described rejuvenation effort can be considered an eligible Main Street rejuvenation effort based on the following:

11 Main Street Project Cont’ A Main Street project: Is carried out within the jurisdiction of smaller community receiving the grant; Has as its purpose the revitalization or redevelopment of a historic or traditional commercial area; Involves investment, or other participation, by the community government and private entities in the community; Involves the development of affordable housing that is located in the commercial area that is the subject of the project.

12 Main Street Project Cont’ Complies with The National Historic Preservation Act (NHPA), Section 106 to preserve significant historic or traditional architectural and design features in the structures or area involved in the project. The site of the affordable housing units that will be developed (Housing Site) must be approved by the State Housing Preservation Officer (SHPO). HUD’s Environmental Review must be completed before breaking ground. HUD will contact the SHPO and do a Section 106 review as a part of the required Environmental Review.

13 Match Grantee contribution of funds must match at least 5% of the amount of requested funds. This 5% Match is statutory and mandatory. The Match must be expended on the affordable housing project in the rejuvenation effort (housing site). The Match must not come from other Section 24 (HOPE VI) funds. The match may be cash or in-kind services with documented value.

14 Eligible Activities Leveraging other resources, cash or in-kind services. The amount of Leverage for both the housing site and for the Main Street project as a whole assists in demonstrating public/private support for the Main Street effort. Match and Leverage could include a wide variety of sources, e.g., other government or private funds, a private loan, a long term lease on the housing site, new infrastructure or improvements made after the Main Street Effort began, building materials or volunteer labor from local people or institutions, etc.

15 Other Eligible Activities Construction Architectural and engineering work; Providing reasonable moving expenses for residents displaced as a result of the revitalization of the project; Economic development activities that promote the economic self-sufficiency of residents under the rejuvenation effort;

16 Other Eligible Activities Necessary management improvements for the Grantee that will enable it to complete the grant, e.g., automating some bookkeeping if funds will flow through the Grantee to a private property owner; Necessary supportive services, e.g., if homeownership units are developed Homeownership Training must be provided. Supportive Services cannot exceed 15% of the grant amount.

17 Limits on Activities Grant funds must not be expended on: Public housing activities; Replacement housing units for demolished or disposed of public housing units; Housing Choice Vouchers (Section 8); Homeownership downpayment for displaced public housing residents Administrative costs of the Grantee; Legal fees; and Transitional Security activities.

18 Cost Limits There are Total Development Cost (TDC) limits per new housing unit. These limits will be used to determine the grant amount. There are also Safe Harbor limits on overhead and profit. Links to these sites are in the NOFA. Limits are available on HUD’s HOPE VI website at /hope6/ and in the NOFA. /hope6/

19 Summary The city is the official applicant. So, any other organization or property owner has to team with the city; If the city has 100 or more HUD financed physical public housing units in its jurisdiction, it is not eligible to apply; If the city has a population of more than 50,000, it is not eligible to apply

20 Authorization Section 24 (of the U.S. Housing Act) authorizes the development, reconfiguration and major rehabilitation of affordable housing that is related to existing Main Street rejuvenation efforts in smaller communities.