1. HOMEOWNER REHABILITATION and Reconstruction PROJECTS
10/12/2018
2018 HOME GRANTEE WORKSHOP
HOMEOWNER REHABILITATION and Reconstruction PROJECTS
Community Programs Division
Tennessee Housing Development Agency
June 13, 2018

2. 10/12/2018
Congratulations!!!

3. FY2018 Application Round Rural Matrix:
10/12/2018
FY2018 Application Round
Rural Matrix:
$7.6M available for program activities
$14.3M in applications for program activities from 39 communities
$7.5M awarded to 17 communities to improve 135 residences
Urban Matrix
$4.9M available for program activities
$3.8M in applications for program activities from 7 communities
$3.5M awarded to 7 communities for program activities

5. Now the real work begins….
The HOME Program is a performance contract….
THDA has a contract with HUD to perform….
Each local government has a contract with THDA to perform….
…those recipients that meet the terms of the THDA HOME program will receive funds to cover eligible costs that help to improve the housing stability of residents in your community.

6. Role of Local Government
10/12/2018
Role of Local Government
Ultimate responsibility for the grant lies with the Grantee
An Administrator consultant is a grant management resource, not a substitute for the Grantee’s hands-on involvement with the project and full responsibility for oversight of the grant implementation
Involving local officials, especially local code officials, may minimize problems if disputes occur

7. Role of Local Government
Approves Policies and Procedures
Hosts the public meeting
Oversees the procurement process
Issues Building Permits
Authorizes Pay Requests
If applicable, provides code inspections
Oversees and monitors program implementation in accordance with program requirements
Resolves/mediates disputes
Ensures fairness and quality of work

8. Your Goal and Our Goal….

9. 10/12/2018
And more importantly….

11. Written Agreements Three year contracts :
July 1, 2018 through June 30, 2021
Expenses or commitments incurred prior to July 1, 2018 will not be reimbursed
Only 60 days after June 30, 2021 to submit final draws
City or County Mayor signs BOTH copies and returns BOTH to THDA with the Start-up Forms.
Written Agreements are due at THDA no later than EOB Friday, July 20, 2018

12. Attachment A Attachment A- Description of Grantee Activities
Provides detail of the activities funded by the HOME grant and other requirements
Other requirements based on the application, i.e. participant contributions, submission of more recent audit
Pay special attention to additional conditions

13. Attachments B, C, D, E & F Attachment B - HOME Project Budget
10/12/2018
Attachments B, C, D, E & F
Attachment B - HOME Project Budget
Shows uses and sources of HOME and other funding
Attachment C – Timeline
Attachment D - Notice of Audit Report
Attachment E – Parent Child Report
Attachment F – Federal Award Notification

14. Start-up Forms Return these forms to THDA:
W-9 – Request for Taxpayer Identification Number and Certification
Must be Rev (This must be the address that the remittance advice is to be sent to.)
Authorized Signature Form (Address must match the address on the W-9)
Return to THDA with Written Agreement by July 20, 2018
Please return the original ACH (Automated Clearing House Credits) Form, completed and signed by bank official DIRECTLY to the State of Tennessee Finance and Administration
Attach an original voided CHECK

15. HOME Investment Per Unit
Minimum HOME $
$1,000
$60,021
0-Bedroom
$68,806
1-Bedroom
Maximum HOME $
$83,667
2-Bedroom
$108,239
3-Bedroom
$118,812
4-Bedroom+
The combination of rehabilitation hard costs and project soft costs cannot exceed the maximum HOME investment per unit.

16. Submitting Draw Requests to THDA

17. EFT (Electronic File Transfer)
Required method of sending documents to THDA:
All work write-ups and estimates, pay requests, and ERRs
Michelle Krisher will set up one account for each organization
If you forget or your password expires, contact Michelle at

18. Submitting Project Setup
10/12/2018
Submitting Project Setup
Prior to initiating solicitation of applications, THDA must have:
Signed Working Agreement
Missing requirements specified in Attachment A as identified
ACH Form (FM-1) with voided check attached (Must be mailed to TN F&A)
W-9 Form – Request for Taxpayer Identification Number and Certification (Rev. 2017)
Authorized Signature Form (FM-2)
Policies and Procedures
Tier One Environmental Review Completed

19. Submitting Project Setup
10/12/2018
Submitting Project Setup
Prior to first draw, THDA must have:
THDA requires draws to be uploaded into the Electronic File Transfer (EFT) system as a SINGLE PDF file.
Completed and approved Tier 2 Environmental Review for site specific address (must be approved prior to obligation of any HOME funds)
Signed rehab contract
Approved work write-up completed, Initialed by homeowner
Completed LBP-4; Lead based paint Inspection report or risk assessment if applicable
Completed HO-22 and supporting documentation
Project Set-up Form (FM-3) MUST BE SIGNED AND INITIALED
Before picture of the house and a picture of the beneficiary

20. Pay Request – Interim Draw
THDA requires draws to be uploaded into the Electronic File Transfer (EFT) system as a SINGLE PDF file.
Required documents:
Request for Payment Form (FM-4) with two authorized signatures
Interim Draw (FM-5) certifying percentage of project completion
Approved progress review
Copies of approved change orders, if applicable
Invoices for soft costs, if applicable

21. Pay Request – Final Draw
THDA requires draws to be uploaded into the Electronic File Transfer (EFT) system as a SINGLE PDF file.
Final draw for project funds must include:
Request for Payment Form (FM-4) with two authorized signatures
THDA Certification of Completion and Final Inspection (FM-7) AND
Certificate of code compliance issued by local community, SFMO, or by licensed third party inspector
Approved Final Review
Change Orders
Statement of lead based paint clearance if applicable
Statement of Homeowners insurance
Invoices for soft costs
Project Completion Report (FM-8)
Recorded copy of Deed of Trust securing HOME investment

22. Pay Requests – Administration
Submit separately from project draws.
Required documents:
Request for Payment Form (FM-4) with two authorized signatures
Invoice from Program Administrator
Non-Profits only submit applicable timesheets
Administrative funds must be drawn down in proportion to the expenditure of project funds.

23. Current HOME Forms Make sure that you are using the current form.
They are located here:
-> Business partners -> Grant Administrators -> HOME Program -> Resource Links at the bottom of the page

24. Homeowner Rehabilitation

25. 10/12/2018
Reconstruction
The intent of a reconstruction activity is to provide assistance to homeowners who might not otherwise be helped due to the prohibited cost of rehabilitating their existing home.
The Grantee must provide methodology and calculations used to determine if the property rehabilitation will exceed 75% of the after rehab value.

26. After Rehab Value
For all homeowner rehabilitation activities, the value of the HOME assisted property after rehabilitation must not exceed 95 percent of the median purchase price for the area.
The Grantee must provide methodology and calculations used to determine if the property rehabilitation will exceed 75% of the after rehab value.
Acceptable Methods:
Average of 5 comparable properties in the same neighborhood or area within 1 mile.
Official Appraisal with after rehab value opinion by the appraiser.
Average of 5 comparable properties in same neighborhood or area < 1 mile, Total Market Value from the Real estate Assessment Data Website

27. Homeowner Requirements
The property must be the homeowner’s principal residence and they must have resided in the property for at least 1 year prior to receiving HOME-assistance.
Proof of homeowners insurance is required and supporting documentation must be submitted prior to the final draw
The household must qualify as low-income – 80% of AMI or less
Income is determined at time of application
Income must be re-verified if income verification at initial application was done more than 6 months prior to entering into rehab contract

28. Ownership Interest Home Ownership interest must be documented
Fee simple title to the property in the beneficiaries name; OR
99-year leasehold in the beneficiaries name ; OR
Inherited property with multiple owners not all residing in the housing; OR
Life estate
AND
No restrictions or encumbrances that would unduly restrict the good and marketable nature of the ownership interest

29. Ownership Interest Inherited Property with Multiple Owners
The owner-occupant must be low income;
Occupy the house as his or her principal residence; and
Pays all the costs associated with ownership and maintenance of the housing.
Note: All owners would have to be a party to the deed of trust

30. Ownership Interest Life Estate
The person with the life estate has the right to live in the housing for the remainder of his or her life and does not pay rent.
The person holding the life estate must be low-income; and
Occupies the housing as his or her principal residence.

31. Property Requirements
HOME grantee determines eligible property types as part of their policies and procedures:
Single Family Dwelling
A condominium unit or townhouse
The maximum after-rehabilitation value of the property cannot exceed 95% of the area median sales price. The after–rehabilitation value must be established prior to start of rehab work and the HO-22 submitted with the project set-up packet

32. Owner-Occupied Rehabilitation
When rehabilitation work is complete, the entire structure must meet the building code in force for that location or the applicable State adopted edition of the International Code and THDA Design Standards for Rehabilitation

33. Eligible Costs Actual Construction Hard Costs
To repair housing deficiencies that prohibit the unit from being code compliant
To meet THDA Rehabilitation Standards and State adopted International Energy Conservation Code
To remove deficiencies of major systems with less than 5 years of useful life
To make the unit accessible to an individual with a physical disability

34. Eligible Costs Soft Costs (Project Delivery Costs)
Costs to settle financing
Preparation of plans, specs and work write-ups
- Costs for work write-ups and property reviews are a maximum of $2,500 based on an RFQ procurement.
- Costs for energy audits
Costs for lead-based paint risk assessments and clearance testing
Costs for temporary relocation/storage
Soft costs count towards HOME subsidy limit

35. Eligible Costs General Property Improvements
Costs not related to code compliance but required improvements necessary to meet THDA Design Standards
May include work: (subject to THDA approval)
To improve visitability
To improve security lighting
To improve energy efficiency
Improvements to meet ADA requirements

36. Temporary Relocation Expenses
HOME funds may pay for moving expenses and temporary living arrangements.
Uniform Relocation Assistance (URA) is not applicable to households temporarily, but voluntarily, displaced during homeowner rehabilitation.
This benefit must be available to all applicants and included in the Policies and Procedures.
Actual receipts for rent or storage charges must be submitted for reimbursement as a project soft cost.

37. Program Requirements

38. Income Eligibility
HOME funds must only benefit households at or below 80% of area median income as adjusted for household size
See 2018 Income Limits applicable for your county
-> Business partners -> Grant Administrators -> HOME Program -> Resource Links at the bottom of the page

39. Income Determination
THDA uses the Section 8 Rental Assistance definition of income in its HOME program
Gross annual income anticipated to be received by all persons in the household during the next 12 months.
Income includes assets
See Chapter One of the HOME Manual for how to determine income

40. Income Determination
Income must be verified before assistance is provided
Must examine 2 months of source documentation for all persons in the household.
Documentation of income verification and how the income was calculated must be maintained in the project file
Household income must be re-verified if HOME assistance is not provided within 6 months

41. Income Determination Acceptable source documents may include:
Wage statement for the past 2 months
Interest statements
Unemployment compensation statements
3rd party verification from employer, bank, etc.
Self-certification is an acceptable form of income verification, if no other source(s) are possible

42. Construction Issues

43. 10/12/2018
Codes:
All construction shall comply with applicable federal, state, county, and local codes, planning and zoning requirements, local authorities’ rules and regulations. Federal regulations which may pertain to any specific project such as the Fair Housing Amendment Act of 1988, Section 504 of the Rehabilitation Act of 1973 and Americans with Disabilities Act of 2010, as amended, also apply.

44. 10/12/2018
Absence of Local Codes
In the absence of local codes, the Tennessee State adopted ICC codes and the Existing Building Code as published by the International Code Congress (ICC) and the Uniform Physical Condition Standards (a comprehensive list which can be found on the HUD.Gov website below) shall apply.

45. Progress Reviews

46. THDA will perform Quality Assurance Reviews by requiring an Approved, Qualified Rehab Coordinator, and a Certified Codes Inspector on each job. THDA will also desk monitor each project and visit sites as we feel appropriate to assure that we continue to meet the Federal Standard.

47. Definitions:
Codes Inspector – A State of Tennessee Certified Building Inspector whose license is current and in good standing with the State Fire Marshal’s Office.
Rehabilitation Coordinator – Qualifications included but aren’t limited to an adequate knowledge and background of residential construction, building codes, experience in cost estimation and be familiar with the HOME rules and processes. They must also have attended or reviewed the THDA Rehab Coordinator training. This position must be procured by the grantee.

48. Inspections
In areas where local codes do not exist:
The State Fire Marshal’s Office (SFMO) has agreed to cover these areas for the Code Compliance component of our program. If the local community does not issue permits you MUST obtain a permit from the SFMO PRIOR to starting any construction work.

49. PERMITS:
All construction shall require a permit. All construction shall also comply with applicable federal, state, county, and local codes, planning and zoning requirements, local authorities’ rules and regulations.
THDA requires that a permit be obtained by the licensed contractor performing the work.

50. To obtain a permit from the SFMO go online at: http://tn
To obtain a permit from the SFMO go online at: permit. Choose the correct permit at the bottom of the page and fill in the required information. Please note that the form must be filled out using Internet Explorer as the web browser. The state’s system does not work with Google Chrome or Mozilla Firefox. The application will be submitted to the state upon completing the application online. A person from the permitting section will then take the information to the cashier’s office who will then call the customer for payment over the phone. Once completed, the permit, receipt, and copy of the application will be mailed to the requester.

51. A complete list of permits, inspections and fees can be found at:
/ pdf
For both new construction and rehabilitation inspections, the permit holder will call the phone number at the bottom of the building permit ( ) when they are ready for an inspection.

52. 1. Rehab Coordinator will perform the Initial Review and create a Work Write Up. This will include any LBP issues as shown on the LBP Risk Assessment. This report should be accompanied by an Energy Audit and photographs. Photographs must include the following: a. All exterior sides of the home, attic and crawl space, as well as any item that is on the WWU as deficient. These items will be sent to THDA for written approval.

53. THDA will review the Initial Review
THDA will review the Initial Review. If we have comments, questions or corrections we will send it back to correcting, or we will approve the report as submitted.
When the Initial Review or Work Write Up is stamped as “APPROVED”, you may proceed to bid the project.
After the winning bidder has been selected, the Adminstrator must submit the scope of work to THDA for approval by receiving a Notice to Proceed Stamp BEFORE a contract is signed

54. When the project has been bid, and a licensed general contractor has been awarded the work, but before actual work has begun, it is the responsibility of the Rehab Coordinator to obtain a copy of the Codes Permit or permits if multiple permits are required, for the file to show it was obtained by the contractor.

55. 5. When the project reaches the 60% point of the construction, the Rehab Coordinator shall visit the site and create a “Progress Review”. This will include the original WWU showing each item and the status of each item as well as photos of these items. This report will be sent to THDA as well for approval. NOTE: You shall also contact the Codes Inspector to conduct interim inspections as required.

56. 6. The Progress Review will also be reviewed by THDA for comments, corrections or additions. When it is stamped “APPROVED” Only then may you proceed to request an interim payment from your Housing Specialist.

57. 7. When the project reaches the completion point of the construction, the Rehab Coordinator shall visit the site and create a “Final Review”. This will include the original WWU showing each item and the status of each item as well as photos of these items. This report will be sent to THDA as well for approval. NOTE: Final review must include documentation of passing final inspection from the Codes inspector.

58. Compliance

59. Compliance Period
Rehabilitation assistance has a compliance period of five (5) years with a 20% annual forgiveness feature
The compliance period is secured by a Grant Note and a recorded Deed of Trust
Reconstruction Assistance has a compliance period of fifteen (15) years with a % annual forgiveness feature
If the homeowner dies during the compliance period and the property is inherited by heirs, the property may be rented without repaying the unforgiven portion of the HOME grant
However, if the heirs sell the property, or if the property is sold with monetary gain by any actions of a court to settle outstanding claims or settle the estate, the unforgiven portion of the grant must be repaid to THDA

60. Record Keeping for Homeowner Rehabilitation Projects
Environmental Review
Bid advertisement
Solicitation of minority and female contractors
Contractor/subcontractor activity report (EO-4)
Section 3 Questionnaire (EO-5)
Grantee personnel polices

61. Record Keeping for Homeowner Rehabilitation Projects
Homeowner rehabilitation policies and procedures adopted by the Grantee’s governing Board
Documentation of public meeting
Priority list of eligible applicants
Requirements noted in Attachment A of the Working Agreement

62. Record Keeping for Homeowner Rehabilitation Projects
Completed homeowner application
Income verification
Proof of ownership
Copies of all bids

63. Record Keeping for Homeowner Rehabilitation Projects
Notice to Proceed
Non-kickback Certification
Right of Recision
Final Invoice, Release of Liens and Warranty
Grant Note
Recorded Deed of Trust
Copies of cancelled checks for payment to the contractor

64. Record Retention
Records must be maintained for 5 years after the HOME affordability period has expired
Example: If project was reconstructed with HOME funds, project records must be maintained for 20 years following the completion of the project
Remember, “completion” is based on the date of the project completion in IDIS

65. Other Federal Requirements

66. Lead-Based Paint
For all units that are pre-1978, all families must receive a copy of LBP-1 (Protect Your Family from Lead in Your Home)
The family must sign verifying that they did receive the information
HUD designates three categories of rehabilitation based on the level of investment in the unit:
Less than $5,000
$5,000 - $25,000
More than $25,000
Follow instructions in HOME Manual based on level of investment in the unit

67. ENVIRONMENTAL REVIEW
HOME funds cannot be committed to a project prior to the completion of the environmental review and release of funds.
The Grantee may not take any choice limiting actions prior to completion of the environmental review.
Choice-limiting actions will reduce or eliminate your opportunity to choose alternatives
Examples: property acquisition, leasing, demolition, rehabilitation, construction, and site improvements (including site clearance)

68. ER & Written Agreement with Homeowner
The Site Specific Environmental Review Process must be completed prior to entering into the written agreement to provide assistance to the homeowner.

69. Levels of Environmental Review
Exempt
Categorically Excluded not subject to the authorities of the Statutory Checklist
Categorically Excluded subject to the authorities of the Statutory Checklist
Categorically Excluded activities converted to Exempt
Environmental Assessment

70. Responsibility for the Environmental Review
Local government grantees assume full responsibility for the completion of the Environmental Review.
Completes the Tier One environmental review.
Makes public notices and Request for Release of Funds to THDA
Submits copy of the environmental review and published Notice to THDA.
After the close of the public comment period and based on a favorable review of any comments received and the documentation provided by the Grantee, THDA issues the Release of Funds.

71. Flood Plains
THDA does not generally permit the rehabilitation of housing located in the 100 year flood plain.

72. Promoting Fair Housing & ADA
All program material must include the fair housing and ADA logos:

73. Fair Housing and Equal Opportunity
FHEO laws are designed to protect individuals and groups against discrimination and to provide equal opportunities in housing, employment and contracting with federal funds.
No person shall on the grounds of race, color, religion, sex, familial status, national origin or disability be excluded from participation, denied benefits or subjected to discrimination under any program funded in whole or in part by HOME.

74. Fair Housing Activities
The Grantee must provide each applicant with a copy of Fair Housing: Equal Opportunity for All brochure as part of the application process
Maintain documentation in your files that all potential homeowners have received the brochure – Homeowner to acknowledge receipt

75. Fair Housing Activities
The Grantee must take steps outlined in their Policies and Procedures to encourage the application for assistance of those who are least likely to apply for assistance
To accomplish, the Grantee may advertise for assistance availability at:
Churches
Convenience stores
Libraries
Senior centers
Local offices of the TN Department of Human Services

76. Limited English Proficiency
Each Grantee must have policies and procedures to assist non- English speaking applicants
Each Grantee must also have a process that notifies LEP persons of language assistance available (i.e. notices, signs) and that is accessible to individuals seeking assistance
Grantee staff should be knowledgeable of all procedures and processes

77. Americans with Disabilities Act (ADA)
Title II requires that State and local governments give people with disabilities an equal opportunity to benefit from all of their programs, services, and activities
State and local governments must relocate programs or otherwise provide access in older buildings that are inaccessible and communicate effectively with people who have hearing, vision, or speech disabilities
Grantees must take steps to promote the availability of HOME assistance at locations that are accessible to individuals with disabilities, including any web sites that are used to publicize the program

78. Conflict of Interest
The HOME Conflict of Interest policy applies to any person who is an employee, agent, consultant, elected or appointed official of THDA, a State Recipient (Grantee) receiving HOME funds.
No person listed above who exercise or have exercised any function or responsibility with respect to activities assisted with HOME Funds or are in a position to participate in a decision- making process or gain inside information may obtain a financial interest or benefit from any HOME activity or the proceeds of such activity either for themselves or for those who they have business or immediate family ties.

79. Conflict of Interest
Covered familial relationships are limited to immediate family members:
Immediate family ties include (whether by blood, marriage or adoption) the spouse (including a step-parent), child (including step-child), sister, brother (including step-brother or step- sister), grandparent, grandchild, and in-laws of a covered person

80. Appearance of a Conflict of Interest
All Grantees must also take steps to avoid the appearance of a conflict of interest.
Grantees must notify THDA of the Appearance of any Conflict of Interest before taking any action.

81. Procurement
Any contract $2,500 or greater must be advertised for bid to insure an open and competitive process
Maintain copies of bid advertisements in your files
There must be at least 3 valid bids
If less than 3 bids are received, the project must be re-bid
Grantees may not negotiate with the lowest bidder
If the scope of the project changes, all bidders must be given an opportunity to amend their bid

82. Section 3
All grantees with a contract of over $200,000 must take steps, to the greatest extent feasible, to provide employment and other economic opportunities to low and very low income individuals within the project area
Also applies to all contracts and subcontracts over $100,000
A grantee is obligated to direct, to the greatest extent feasible, new hires and contracts to Section 3 businesses and residents.
Section 3 applies to the entire project regardless if the project is fully or partially funded with HOME resources.

83. Section 3 Resident A Section 3 Resident is: A Public Housing Resident
A resident of the metropolitan area or non-metro county in which the Section 3 covered assistance is expended and who qualifies as a low or very low income person.

84. Section 3 Business Concern
51% or More Owned by Section 3 Residents OR
30% of Employed Staff are Section 3 Residents
25% of subcontracts committed to Section 3 Businesses

85. Section 3 Qualifications
A Section 3 Resident must meet the qualifications of the position to be filled
A Section 3 Business Concern must have the ability and capacity to perform under the contract

86. Section 3 Responsibilities
Provide a hiring preference to Section 3 Residents
Provide an award preference to Section 3 Business Concerns
Assist with achieving compliance among contractors

87. Section 3 Preference Section 3 is race and gender neutral
Section 3 is not Minority Business Enterprise (MBE) or Woman Business Enterprise (WBE)
Hiring preference is based on:
Income (80% or less of AMI)
And
Location (project area)

88. Section 3 Responsibility
Notify Section 3 residents and business concerns about hiring and contract bids
Post job/contract notices at public housing sites
Form partnerships with organizations working with low income job seekers
Work with local trade unions to identify businesses that qualify as Section 3 business concerns
Incorporate Section 3 clause into all contracts CFR §135.38

89. Tell Your Community’s Story

90. Highlight Your Successes
Tell the story of your program and the investment of federal resources into your community
Take before and after photos of each unit assisted and submit to THDA
Telling Your Story – Communications Guide
Faces Behind the Funding Questionnaire and Photo Release

91. HOME Resources

92. HOME Resources HUD: Bookmark the HUD website: https://www.onecpd.info
Sign up for updates
THDA:
Bookmark the THDA HOME website:

93. HOME Resources On the THDA Web Site: www.THDA.org
2018 HOME Program Description
2018 HOME Manual (8/1/2017)
THDA Design Standards for Rehabilitation
Forms
Property Value Limits, Income Limits, Max Per Unit Subsidy Limits
Telling Your Story – Communications Guide
Faces Behind the Funding Questionnaire and Photo Release

94. 2018 HOME Manual 2018 Manual is posted to the THDA website (8/1/2018)
-> business partners -> grant administrators -> HOME Program -> scroll down to the bottom of the page under “Resource Links”
READ the relevant chapters and print for easy reference.

95. Contacts Don Watt, Director, Community Programs Division
or (615)
Bill Lord, Housing Program Manager
or (615)
Craig Stevens, Senior Housing Coordinator
or (615)
Roni Hagy, Senior Housing Coordinator
or (615)
Mia Billingsley, Senior Housing Coordinator – Compliance
or (615)
Dwayne Hicks, Senior Housing Coordinator – Construction
or (615)

96. Remaining Questions