Community Development

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1 Rental Program Statement PURPOSE The rental program provides quality, safe and affordable rental housing in vibrant places by granting financial resources to our local and statewide partners. Priority of properties is moving toward being inclusive of a wide range of building types that can create an assortment of urban conditions: downtown mixed-use buildings, semi-detached and attached duplexes, front/ rear/stacked row houses, townhomes and stacked flats (restrictions apply). ELIGIBLE APPLICANTS Non-Entitlement Local Unit of Government Nonprofits and nonprofit community housing development organizations (CHDO). ELIGIBLE ACTIVITIES Moderate or substantial rehabilitation of existing occupied or vacant rental housing or conversion of vacant space to rental units. ELIGIBLE COSTS The actual cost of rehabilitating housing, units includes: Costs to meet applicable new construction or rehabilitation standards Energy-related repairs or improvements Improvements necessary for persons with disabilities Abatement or reduction of lead-based paint hazards (restrictions apply) CDBG-Assisted: Façade improvements may be eligible as part of rehab project if improvements are generic or uniform to the building MSHDA and HOME project administration is limited to 10 percent of the grant amount and 10 percent project related soft costs. CDBG is limited to 18 percent administrative costs of the grant amount plus 2 percent project related soft costs. PROJECT CONDITIONS 25 percent leverage on grant award required A successful place-based project must result in an eligible beneficiary $40,000 per new unit created or $25,000 per existing unit Community Development michigan.gov/mshda

2 Downtown Rental Rehabilitation Development Pre-Application Process Thank you for your interest in the Downtown Rental Rehabilitation Program through The Michigan State Housing Development Authority (MSHDA). Please fill out the following completely and submit with all of the required documentation. Development Location: City/Village/Township County Address Total Development Cost: $ MSHDA CDBG Loan Request ($40,000/per unit new, $25,000/per unit rehab): Owner Equity Cash: Number of Units: Unit Configuration: Community Outreach Specialist: The applicant and building owner are aware of and agree to the following program regulations: 1) HRF-CDBG loan will be secured by a mortgage, note and regulatory agreement with a five (5) year forgivable term with no monthly payments and approved CDBG guidelines, rent restrictions, applicable local rehabilitation codes and/or HUD-UPCS standards. 2) The rental structure, construction costs and operating budget will be approved by appropriate CD staff and will be detailed in the CD rental rehabilitation pro-forma. 3) The property owner will submit documentation of their leverage for the minimum 25% match. 4) Restrictions on incomes will apply until 51% of the units have been leased to income eligible tenants at or below 80% AMI. If the initial income eligible tenant(s) (at or below 80% AMI) leaves prior to the one (1) year minimum lease, the next tenant(s) must also be an income eligible tenant(s). 5) The income of individuals and area median income shall be determined by the Secretary of the Treasury in a manner consistent with determinations of lower income families and area median income under Section 8 of the U.S. Housing Act of 1937, including adjustments for family size. 6) The rent charged to the initial occupant(s) of 51% of the units cannot exceed the HUD Section 8 Fair Market Rent. The landlord may not economically displace the initial low to moderate tenant(s). Therefore, any rent increase for those tenant(s) after their first year of occupancy cannot exceed 10% of the previous year s rent. All units in the project must be maintained as residential rental property for a period of five (5) years. 7) Architectural drawings will be reviewed and approved by MSHDA. 8) The Applicant shall agree to comply with federal Section 3 requirements and a Section 3 Plan will be submitted and approved to be acceptable to the Authority.

3 9) The property owner understands they cannot execute any contracts or alter the interior or exterior (including the parcel the property is on) from the time of application until the Request for Release of Funds and the related certification has been approved by MSHDA. This requirement is found in Sec Limitations on activities pending clearance Neither a recipient nor any participant in the development process, including private nonprofit or for-profit entities, or any of their contractors, may commit HUD assistance under a program listed in Sec. 58.1(b) on an activity or project until HUD or the state has approved the recipient's RROF and the related certification from the responsible entity. In addition, until the RROF and the related certification have been approved, neither a recipient nor any participant in the development process may commit non-hud funds on or undertake an activity or project under a program listed in Sec. 58.1(b) if the activity or project would have an adverse environmental impact or limit the choice of reasonable alternatives. 10) Requirements and documentation submittal prior to application Asbestos Survey for mixed use buildings (not considered part of owner s leverage) Documentation of incentives and leverage financing Preliminary architectural drawings (not considered part of owner s leverage) MSHDA Proforma Occupancy Report (If existing units are occupied) Tenant/Landlord Utility Statement Verification of mortgage/land contract Verification of paid taxes Proof of insurance Documentation of site control for each property (deed/land contract/purchase agreement) Resolution or public hearing meeting minutes by local unit of government to submit application to MSDHA Evidence of tax incentives given to building owners (if applicable) List of Partners/Roles Commercial occupancy, if any, of each building Map of target area Interior and exterior photos Documentation of capacity and qualifications Third Party Administration Plan (if applicable) Rental Rehabilitation Program Guidelines Section 3 Plan The Local Unit of Government completes and submits their partnership profile on MATT ) Documentation submittal after grant approval Transaction Screening or Phase 1 Environmental Site Assessment Phase 2 ESA, if required Stamped Architectural drawings Site Data 1) What is the ownership structure of the building? Purchase Agreement Owner owned Land Contract other 2) What is the address of the site? 3) Will the proposed project create apartments with at least 750 square feet (and at least one bedroom per unit)?

4 4) What is the total number of units proposed and square footage? 5) Describe the building 6) What is the present use of the commercial and residential? 7) What is the condition of the existing structure? 8) Are there existing apartments? If yes, are they occupied? 9) Does the city/township/village have a local building official? If no, who will be contracted to verify building codes are being met? 10) Does the city/township/village have active code and rental enforcement? 11) What are the local fire suppression requirements relative to upper story downtown development? 12) Does the city/township/village have adequate fire and rescue to access upper down town residential space? 13) Has the local fire department official been notified of the potential development? 14) Is there adequate water supplied to downtown buildings to add additional units for pressure and supply? If no, is the city/township/village willing to provide as an incentive? 15) What companies supply Water/Gas/Electric? 16) Is there a local ordinance/requirement for downtown apartment parking? If yes, is the property owner able to request a variance? Will the project provide a minimum of one (1) parking space per unit free to the tenant?

5 17) Does the project involve historic buildings eligible for historic tax credits (placed in service prior to 1936), and that are in a historic local district? Has SHPO been consulted? Will historic tax credits be pursued? If yes, when? 18) Will the proposed project preserve the historic character of the building? If yes, please explain how. 19) What are the nearby amenities? (medical, financial, food, entertainment etc.) 20) How far are local schools from the location? 21) What is the walk score of the location? 22) Is there access to public transportation? 23) Is the location near major roads/highways? 24) Are there any community resources? (parks, trails, water etc.) 25) Is the city/township/village willing to provide any incentives? OPRA NEZ Façade Program Brownfield City/Village/Township owned utilities that they are willing to supply to the building other 26) Does the city/village/township have any designation? Historic downtown Core Community Main Street Redevelopment Ready Community MiNeighborhood 27) Does the city/township/village have a Master Plan, market study or part of a regional consortium plan that addresses land use, housing or downtown rental? 28) Does the plan need local site approval? 29) Are there any known environmental hazards? 30) Has the design been reviewed by MSHDA? 31)

6 32) Who will be managing and marketing the property? DEVELOPMENT TEAM ANALYSIS: Architect: Name: Address: Individual Assigned: Telephone: Fax #: Experience: Architect's License: Third Party Administrator: Name: Address: Individual Assigned: Telephone: Fax #: List of Current MSHDA Projects and status: All information submitted in this application is true to the best of my knowledge. I fully understand that any significant misstatements or omissions from this application may delay the review process until such time all information is received. Date MSHDA Applicant (Local Unit of Government) Date Third Party Administrator Date Building Owner

7 This form is issued for your information under the authority of P.A. 346 of 1966, as amended, and Section 8 of the U.S. Housing Act of Michigan State Housing Development Authority Utility Schedule Region 2 Effective January 1, 2015 Counties in Region 2: Berrien, Branch, Calhoun, Cass, Hillsdale, Jackson, Kalamazoo, St. Joseph, Van Buren Apartment/Flat/Garden/Walk Up Duplex/Townhouse Manufactured Home/Single Family Utility* 0 BR 1 BR 2 BR 3 BR 4 BR 5 BR 0 BR 1 BR 2 BR 3 BR 4 BR 5 BR 0 BR 1 BR 2 BR 3 BR 4 BR 5 BR Heating-Natural Gas $15 $17 $19 $22 $24 $26 $20 $30 $40 $50 $60 $70 $19 $31 $43 $54 $66 $78 Heating Electric $25 $40 $55 $70 $85 $100 $34 $52 $69 $87 $105 $122 $46 $66 $87 $108 $128 $149 Heating Bottle Gas $55 $64 $73 $82 $91 $100 $74 $113 $151 $189 $227 $266 $74 $118 $162 $207 $251 $296 Heating Fuel Oil $51 $59 $67 $75 $83 $91 $47 $94 $141 $189 $236 $283 $67 $108 $148 $189 $229 $270 Cooking-Natural Gas $14 $15 $16 $17 $18 $20 $14 $15 $16 $17 $18 $20 $14 $15 $16 $17 $18 $20 Cooking Electric $9 $12 $15 $18 $21 $24 $9 $11 $15 $18 $21 $24 $9 $11 $15 $18 $21 $24 Cooking Bottle Gas $11 $15 $20 $24 $28 $33 $11 $15 $20 $24 $28 $33 $11 $15 $20 $24 $28 $33 Hot Water-Natural Gas $5 $8 $11 $14 $17 $20 $5 $8 $11 $14 $17 $20 $5 $8 $11 $14 $17 $20 Hot Water Electric $17 $26 $35 $44 $53 $62 $17 $26 $35 $44 $53 $62 $17 $26 $35 $44 $53 $62 Hot Water Bottle Gas $20 $32 $43 $55 $66 $77 $20 $32 $43 $55 $66 $77 $20 $32 $43 $55 $66 $77 Hot Water Fuel Oil $20 $32 $43 $55 $66 $78 $20 $32 $43 $55 $66 $78 $20 $32 $43 $55 $66 $78 Other Electric $36 $49 $60 $72 $83 $94 $36 $52 $66 $86 $101 $115 $47 $63 $78 $99 $114 $130 Water $18 $22 $27 $31 $36 $40 $18 $22 $27 $31 $36 $40 $18 $22 $27 $31 $36 $40 Sewer $21 $27 $32 $38 $44 $49 $21 $27 $32 $38 $44 $49 $21 $27 $32 $38 $44 $49 Air Conditioning $3 $6 $9 $12 $15 $18 $0 $5 $9 $14 $18 $23 $2 $6 $10 $15 $19 $23 Trash $19 $19 $19 $19 $19 $19 $19 $19 $19 $19 $19 $19 $19 $19 $19 $19 $19 $19 * Service Charge: Gas for all unit types add $11 Electric for all unit types $9 Tenant Furnished Appliance Allowance: Range $4 Refrigerator $5 If the tenant is responsible for supplying the range and/or refrigerator, use the above allowances. Air Conditioning Allowance: Only allowed if windows are not operable. NOTE: Sales tax is included in the amounts listed. To use this schedule: Fill in the appropriate amount on the chart for each utility/appliance for. which you are responsible MSHDA 1793b (1/1/2015) Previous versions obsolete Heating Cooking Hot Water Other Electric Water Sewer Trash Air Conditioning Other Gas Service Charge Electric Service Charge Range Refrigerator TOTAL ROUNDED Gas Electric Propane Oil Wood (Secondary) Cost R