Dear Community Investment Partner:
The Affordable Housing Program (AHP) Implementation Plan (IP) was revised on January 27, 2012. Many of the IP revisions affected the AHP competitive application program. Beginning with 2012 Round A, all AHP applications will require additional documentation in the following areas:
To verify project land/site acquisition costs, documentation in the form of final settlement statements, valid sales purchase contracts, executed purchase or purchase option agreements, or other relevant documentation must be submitted.
To verify a project’s permanent and operational sources of financing, documentation from other funding sources that have committed financing to the project must be submitted.
Each benchmark deviation must be explained in detail, and the explanation must specify the exact cause of the deviation. Documentation must also be submitted to substantiate the reason for each benchmark deviation. For example, the HUD Management Fee Schedule for the county where the project is located could be submitted to support the written explanation for a Management fees-per-unit per year benchmark deviation.
The revised Rental Cash Cost-per-Unit financial benchmark will now rely on HUD 221(d)(3) or state tax credit program guidelines for maximum development costs-per-unit. Documentation of the published guidelines for the project’s geographic area must be submitted as verification of the benchmark maximum. You may follow these links to tables that can be used for projects located in the Bank’s district (Arizona, California, and Nevada).
The revised financial benchmark, Cash Costs to Construct Homes, will now rely on the limit for one- to four-family loans established by the Federal Housing Administration (FHA). Documentation of the FHA loan limits for the project’s geographic area must be submitted for verification of the benchmark maximum. Limits can be found on the FHA Mortgage Limits web page.
All references to the term “Project Owner” have been replaced by the term “Project Sponsor.” Paragraph 22 has been amended to prohibit assignment of any rights or obligations of the Project Sponsor under the DSA without the written consent of the Bank. The signature page has been amended to include only the authorized signatures of the Member, Project Sponsor, and the Bank.
If you have any questions about the new AHP application documentation requirements, please email Community Investment or call (415) 616-2542.
James E. Yacenda
Vice President and Community Investment Officer