1 Green Initiative HUDs Office of Affordable Housing Preservation (OAHP) IPED Miami February, 2008

2 HUDs Green Initiative A pilot initiative to encourage owners of affordable, multifamily properties to rehabilitate and operate their properties using sustainable Green Building principles.

3 Some HUD Background Energy Efficiency Efforts Energy Efficiency Efforts Office of Healthy Homes Office of Healthy Homes Preservation of Existing Housing Stock – the Mark-to-Market (M2M) Program Preservation of Existing Housing Stock – the Mark-to-Market (M2M) Program Created by Congress in 1997 Created by Congress in 1997 Rehabilitates Section 8 Properties and Restructures Underlying Debt Rehabilitates Section 8 Properties and Restructures Underlying Debt 1,700 Properties with over 150,000 Units Completed to Date 1,700 Properties with over 150,000 Units Completed to Date M2M Reauthorized through FY 2011 M2M Reauthorized through FY 2011

4 Why apply Green to M2M? Challenges of bringing green to most of the assisted portfolio. Challenges of bringing green to most of the assisted portfolio. Opportunity to fund these efforts in a representative sample of the larger HUD portfolio. Opportunity to fund these efforts in a representative sample of the larger HUD portfolio. Ability to collect real data from within the HUD portfolio for broader future application. Ability to collect real data from within the HUD portfolio for broader future application. M2M owner incentive (through Significant Additions, and Incentive Performance Fee). M2M owner incentive (through Significant Additions, and Incentive Performance Fee). The Pilot Program works within existing M2M statutes and regulations, and within current budget authorities. The Pilot Program works within existing M2M statutes and regulations, and within current budget authorities.

5 Project Eligibility for the Initiative: Green Initiative Introduced in Fall, 2007 Green Initiative Introduced in Fall, 2007 All M2M properties are eligible All M2M properties are eligible 30 properties/over 4,000 units currently in the pilot 30 properties/over 4,000 units currently in the pilot Requirements for a Green M2M Restructure: Requirements for a Green M2M Restructure: Green Physical Condition Assessment Green Physical Condition Assessment Green Rehab (Baseline, Fixed, and Variable) Green Rehab (Baseline, Fixed, and Variable) Green R4R plan – 20 Year Physical Needs Green R4R plan – 20 Year Physical Needs Green O&M Plan Green O&M Plan Staff and Contractor Certification Requirements Staff and Contractor Certification Requirements

6 Owner Incentives Reduced Owner Contribution to Rehabilitation Reduced Owner Contribution to Rehabilitation Reduced from 20% of Rehab Costs to as little as 3% of Rehab Costs Reduced from 20% of Rehab Costs to as little as 3% of Rehab Costs Applied to All Systems, Appliances, and Components that meet the Green Standard Applied to All Systems, Appliances, and Components that meet the Green Standard Increased Incentive Performance Fee (IPF) Increased Incentive Performance Fee (IPF) Up to 50% Increase Up to 50% Increase Admin Fee Allowed from Additional Funds Admin Fee Allowed from Additional Funds Incentive to Owners to Seek Grants Incentive to Owners to Seek Grants Potential Cash Flow Increase from Savings Potential Cash Flow Increase from Savings Improved Property Improved Property

7 For More Information on HUDs Green Initiative: OAHP Green Website: OAHP Green Website: OAHP Resource Desk Q&A: OAHP Resource Desk Q&A: (Free Registration) (Free Registration) Contact for Green Initiative Information: Contact for Green Initiative Information: