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Affordable/Workforce Housing Study
Chapter Five

Table of Contents

Executive Summary

Introduction: Defining Affordable and Workforce Housing

Chapter 1: Monterey County Housing "Least Affordable in U.S."   

Chapter 2: FORA’s Original Affordable Housing Goals

Chapter 3: Barriers, Opportunities and Strategies

Chapter 4: Models and Examples

Chapter 5: Federal, State, Local and Private Resources

Chapter 6: Findings and Recommendations

Bibliography

Chapter Five:

Federal, State, Local and Private Resources

U.S. Department of Housing and Urban Development (HUD)
Historically, HUD directly supported the development of housing that served many different types of households. Currently, HUD does not provide financing for family developments, but makes a limited amount of funding available for housing that serves seniors and people with disabilities. Some funds for the development of family housing are distributed through local public agencies.

Low Income Housing Tax Credits (LIHTC)

Increasingly, developers of affordable housing have turned to the LIHTC program for financing. Sponsors can compete to obtain allocations of federal and state low-income tax credits. Using tax credits, sponsors can partner with corporate investors who provide equity to the development in exchange for the tax benefits generated by the housing. Although using tax credit financing is complicated and adds administrative costs, it fills a substantial portion of the funding gap with no impact on the tenants' rents. With the reductions in financing from HUD, tax credits are very valuable. Tax credit equity typically covers 40% -50% of project costs.

Summary of Affordable/Workforce Housing Resources

Affordable Housing Financing--;Bank of America offers a large volume of traditional and special loan products, along with affordable housing expertise to make the most impact in communities it serves. For-profit and nonprofit developers and organizations, public housing agencies, first time homebuyers are eligible for various products. 90% loan to value ratio.

Affordable Housing Program--;Federal Home Loan Bank of San Francisco provides grants or subsidized interest rate loans for purchase, construction of owner-occupied housing by or for very low-, low-, and moderate-income households and/or to finance the purchase or construction of rental housing. $18 million available through member banks annually in competitive process. Counties, for-profits, nonprofits, public housing agencies are eligible. The amount of grant or interest rate subsidy depends on the amount of assistance required to make the project feasible. (415)616-2542.

Bridge Loan Program--;New York-based secondary mortgage market institution provides bridge loans for construction of new rental housing to provide flow of funding between project closing and equity pay-ins by tax credit investors. To be used with tax credit projects. Nonprofits are eligible. (212)455-9882

California Equity Fund--;Tax Credit Syndicate works primarily with nonprofit developers of affordable (new rental) housing, providing equity investment through purchase of tax credits. $50 million fund. $800,000 to $15 million minimum/maximum investment. (213)250-9550

CHFA Bridge Loan Program-- California Housing Finance Authority (CHFA) offers a 2nd loan program designed to provide tax-exempt funds necessary to meet the 50% Basis Test required for 4% Tax Credits in the construction of low income housing. (916)322-5123

CHFA Homeownership Program--;Offers single-family home loans requiring as little as 3% down at below-market interest rates (or layered with deferred payment silent second mortgages) to first-time low- and moderate- income buyers. CHFA Approved Lenders access program on behalf of eligible borrowers. Available annual funding $1 billion. (916)322-5123

CHFA Self-Help Builder Assistance Program-- Development loans to mutual self-help nonprofits for single family construction. Offers an opportunity for families and individuals with limited down payment resources to obtain homeownership. The borrower's labor represents the down payment. Permanent mortgage loans at 5% interest for single family homes built by owner-builders. $2,000,000 for development loans, continuous funding for loans to buyers. Below market interest rate. (916)322-5123

CalHome Program-- Grants to local public agencies and nonprofit developers to assist individual households through deferred-payment loans. Direct, forgivable loans to assist development projects involving multiple ownership units, including single-family subdivisions. Cities, counties, nonprofits are eligible. (818)550-9895

California Community Reinvestment Corp (CCRC)--;Private lender provides permanent financing for new construction of low-income housing through a revolving blind loan pool of $211 million. Loan rates are tied to T-bills of similar fixed terms. Forward commitments available up to 24 months. For-profit and nonprofit developers are eligible. (498)467-8805

CalPERS Housing Development Program--;Working with partners, CalPERS is investing $450 million in construction and equity investment in single family home developments of 60 – 250 “entry level” homes. For-profit builders are eligible. $3 – 30 million minimum/maximum award amount. (916)326-3630.

Community Development Block Grant Allocation--;Enterprise Fund Component--;California HCD program reserves block grant funds for cities and counties, which in turn make loans to businesses or fund public infrastructure improvements. Competitive grants to $250,000. Counties and cities with population less than 50,000 are eligible. (916)327-3713

Community Development Block Grant – Economic Development Allocation--;Over the Counter Component--;California HCD provides matching grants to cities and counties for infrastructure required to assist business that creates or retains jobs for low-income persons. Typically grants are used to construct sewer, water and street improvements. Average grant amount $300,000. Counties and cities less than 50,000 population. (916)327-3713

Community Development Block Grant--;Planning/Technical Assistance--;California HCD provides matching grants averaging $30,000 for planning and feasibility studies for projects benefiting low-income persons. (916)327-3713

CHFA 100% Loan Program (CHAP)--;California Housing Finance Agency (CHFA) provides 100% of the financing needs for eligible first-time homebuyers by providing a below market interest rate first mortgage combined with a 3% “silent second” to purchase newly constructed or existing housing. (916)322-5123.

Community Development Finance Dept--;Private lender offers construction loans and long-term loans for low- and moderate-income housing developments. $1 billion per year, interest rate fluctuates. (925)947-2474

Community Reinvest Act Loan Program--;Wells Fargo Bank provides construction financing and predevelopment/interim financing for for-profits, nonprofits, cooperative corporations and owner-occupants of housing. &160 million fund. (415)396-3832

CRA Lending--;SAMCO, a private lender, provides long-term loans, technical assistance and equity investment in new rental housing, transitional housing and other activities. $300,000 - $10 million minimum/maximum loan grant amount. Maximum loan usually 80% LTV. Interest tied to the 10 T-bill. Cities with more and less than 50,000 population, counties, nonprofits, for-profits, public housing agencies are eligible.

EAH, Inc. (Ecumenical Association for Housing)--;Developer, property manager of quality affordable housing units (new rental. For-profits, nonprofits, cities and counties eligible to apply. (415)258-1800

Enterprise Mortgage Investments, Inc.-- Provides reasonably-priced, long-term mortgages, streamlined processing and 90% loan to value to for-profit and non-profit community organizations. EMI provides first-mortgage financing across the nation as a Fannie Mae delegated lender. They have teamed with the Ford Foundation and Fannie Mae to create a $150 million first mortgage financing program for affordable multifamily rental housing. Criteria: 10% of units must be under market rate, 15 units minimum. For-profits and nonprofits eligible. (410)964-0552

Family Housing Demonstration Program--;California HCD program offers construction loans and long-term loans for new rental affordable housing and services which may include on-site child care, job training and development. Below market (3%) interest rates.

Fannie Mae

Enterprise Social Investment Corporation (ESIC) is a subsidiary of The Enterprise Foundation who works with partners to finance, develop and acquire affordable housing in the U.S.