Pennsylvania Code & Bulletin

• No statutes or acts will be found at this website.

The Pennsylvania Bulletin website includes the following: Rulemakings by State agencies; Proposed Rulemakings by State agencies; State agency notices; the Governor’s Proclamations and Executive Orders; Actions by the General Assembly; and Statewide and local court rules.

PA Bulletin, Doc. No. 96-490


Home Investment Partnerships Program; Request for Proposals for Fiscal Year 1996

[26 Pa.B. 1395]

   The Department of Community Affairs, (DCA), or its successor, is announcing the availability of 1996 Home Investment Partnerships Program (HOME) funds. The HOME Program is the Commonwealth's primary vehicle to provide affordable housing which supports local efforts to develop economically vibrant, globally competitive communities. Beginning in the 1996 program year, Pennsylvania's HOME Program will be integrated into a comprehensive community development strategy to enhance economic growth and development. This approach recognizes that the creation of new affordable housing options and opportunities are not only essential to the health and welfare of many families, but to the economic well being of the Commonwealth as a whole.

   In addition, HOME funds may be used for affordable housing disaster recovery purposes. The U. S. Department of Housing and Urban Development (HUD) has waived certain provisions of the HOME Program Rule for HOME funds used for this purpose. DCA is currently seeking clarification on the suspended provisions, and will inform those interested during the training sessions discussed within this notice.

   The amount of HOME funds available for distribution is contingent upon a final appropriations by Congress. At this time, the Department has been notified it will receive $8,353,000. This is approximately 46% of the total amount anticipated. The Department will reserve 4% of the total allocation for its administration, and award the balance. The Department expects to award all FFY 1996 funds as a result of the response to this RFP.

   Pennsylvania's HOME Program is a flexible financial tool for housing activities. HOME promotes community stability, and provides a significant community impact by creating additional housing units through new construction and rehabilitation. HOME program funds can be used in a variety of ways, including market oriented approaches which offer opportunities to revitalize communities with new investment, whether it be homeownership or rental activities. Homeownership creates economic prosperity for communities and families, and acts as a dynamic generator of economic growth. Increased housing starts and home sales often times represents renewed economic confidence in communities.

   HOME can also assist communities which have goals of promoting income diversity by providing support for mixed-income developments. These activities can create environments that enhance economic and social empowerment.

   The Department will accept applications for any HOME eligible activity, other than rental housing activities for five and more units (see discussion of the programs offered by the Pennsylvania Housing Finance Agency below.) HOME eligible activities are assistance for:  homebuyers down payment and/or closing costs and second mortgages; homeowner rehabilitation; developers undertaking single family sales housing; rental housing rehabilitation or new construction of between 1 and 4 units; single room occupancy; group home projects; and tenant based rental assistance and security deposit assistance. Projects can be designed to offer:  equity investments, interest-bearing loans or advances, noninterest bearing loans or advances, deferred payment loans, grants and loan guarantee funds.

   The Commonwealth's Consolidated Plan (and annual update--FFY 1996 Action Plan) states that priority for funding will be given to projects that serve very low-income households (up to 50% of the median family income for the area). The Department will distribute the 1996 HOME Program allocation in accordance with the Action Plan. Successful applicants will be those that address the Commonwealth's priority, meet the requirements of the HOME Program, and address the issues in the Housing Goals and Action Steps. Applications for all eligible HOME activities will be accepted.

   If an applicant can demonstrate that the needs of very low-income households are currently being substantively addressed within the community, the Commonwealth's priority will be considered to have been met for proposed projects that:

   *  Promote diversity within a community, including but not limited to, diversity of race, ethnicity, income level and disability status; or

   *  Are an integral part of an overall community development strategy which addresses and directs resources toward community needs such as housing, transportation, employment and infrastructure.

   In addition, the following types of programs and developments also are priorities for HOME funding (the listing is not a rank ordering of priorities, bur rather are, in part, identified in the Consolidated Plan).

   Programs and projects submitted by nonparticipating jurisdictions

   Programs and projects which maintain and improve the quality of housing

   Programs and projects which build capacity of local governments and housing organizations

   Programs and projects which link housing and supportive services

   Programs and projects which improve rental housing opportunities

   Programs and projects which assist families and individuals to become first-time home buyers

   Programs and projects which address the economic, social and health problems of the homeless

   Programs and projects which demonstrate a minimization of regulatory barriers to affordable housing

   Programs and projects which further fair housing and minimize community opposition

   Programs and projects which link lead-based paint hazard reduction with efforts to health prevention programs

   Programs and projects which return program income

Overview of the Application Process

   The Commonwealth will distribute the 1996 HOME Program allocation in accordance with the Action Plan. The Commonwealth's Consolidated Plan standardized the Program Year for all Federal funds received from HUD. Now the State's Community Development Block Grant, Emergency Shelter Grant, and HOME Programs run concurrently with the calendar year (January 1--December 31). Successful applicants will have until January 31, 2001 to complete the projects, conduct an audit and close out their programs.

   Participating jurisdictions, as defined by the National Affordable Housing Act of 1990, will receive consideration for home funding only after nonparticipating jurisdiction funding needs have been met. Given DCA's experience, it is unlikely that participating jurisdictions will receive home funding.

   The Department is responsible for administering the HOME Program in accordance with the requirements of the National Affordable Housing Act of 1990; the Federal Regulations published in the Federal Register on December 16, 1991 (24 CFR Part 92 HOME Investment Partnerships Program), and revisions thereto. HOME Analysts in the regional offices are prepared to answer HOME-related affordable housing development questions.

   For administrative and other practice reasons, applications for HOME funds should be submitted by a unit of local government. Units of local government are eligible to become State recipients. As a State recipient, a unit of local government will have direct access to the Federal Cash and Management Information System (CMIS). If there are unique and extenuating circumstances, entities other than units of local government may apply directly to the Commonwealth. In this case, the processing of required information in the CMIS must be accomplished through the Commonwealth.

   *  Applications submitted by a unit of local government may be on behalf of public agencies, nonprofit organizations or private developers. Private nonprofit housing organizations that are unable to secure their unit of local government's approval as an applicant should contact the appropriate regional office.

   *  Applications for CHDO Certification may be submitted by private nonprofit organizations throughout the year. Applications for CHDO Operating grants, CHDO technical assistance and site control loans and CHDO seed money loans may be submitted by local governments on behalf of certified CHDOs throughout the year.

   *  Applications selected for funding approval must contain all necessary documentation for immediate contracting. Applications will be reviewed on the basis of stated need and how the proposed activity will address that need, and how the proposal serves the larger mission of promoting economic and social empowerment in the region in which the project is located. Applicants selected for HOME funding will also be required to comply with the HOME Statement of Assurances on Form BHD-175, Antidisplacement/Relocation, and Affirmative Action plans and fulfill fair housing requirements. In addition, applicants selected for HOME funding will be required to adopt a Minority and Women's Business Enterprise Plan, and the Commonwealth's Affirmative Marketing Policy.

   *  Applicants selected for funding will be required to attend HOME State recipient training.

   *  All programs should be structured to maximize the return of program income to the Commonwealth. For example, in a homeowner rehab program, a deferred payment 0% loan due on sale achieves the same purpose as a grant yet returns dollars to be used by the Commonwealth for affordable housing. Locally revolving loan programs will not be permitted.

   *  Because of the complexity of Federal regulations and requirements associated with these programs, a minimum application amount of $50,000 has been established.

   *  The Department will again reserve 30% of the HOME allocation for distribution by the Pennsylvania Housing Finance Agency (PHFA) for rental housing developments of 5 units and more.

   The Department completes competitive reviews to make final funding decisions. Program design descriptions, management plans and staff capacity components are carefully evaluated to ensure that grants will be administered in a timely manner and according to program rqeuirements. Matching funds, and other leveraged funds necessary to complete the proposed program or project should be in place at the time of application.

Other Community Development Resources

   Communities of Opportunity Program--The Department is refocusing the use of funds appropriated to it under the Housing and Redevelopment Assistance Law (H&RA). The new program, entitled Communities of Opportunity Program (CoOP), is based on comprehensive community development strategies that recognize communities as a key component in contributing to rebuilding the economic strength of the Commonwealth. The Department will utilize H&RA funds to support local initiatives designed to promote the stability of its communities, and to assist communities in achieving and maintaining social and economic diversity, ensuring a productive tax base, and a good quality of life. The creation of local partnerships of municipal agencies, the financial community, not for profit, and for profit organizations is encouraged. Since H&RA funds will not be used primarily to support affordable housing activities, they will not typically be used to match HOME funds.

   Pennsylvania Housing Finance Agency--The Commonwealth reserves 30% of the State's annual HOME allocation for the Pennsylvania Housing Finance Agency (PHFA) through a subrecipient agreement. PHFA offers the PennHOMES Program which provides flexible interim and permanent mortgage financing to developers of affordable rental housing (5 units and more.) Interest rates are set based on what each project can support. HOME nonparticipating jurisdictions are given priority for the HOME funds utilized with the PennHOMES Program.

   The PennHOMES Program also includes the Commonwealth's Community Housing Development Organization (CHDO) set-aside. CHDOs with Market and Site Approval will be advised by PHFA of the availability of CHDO project-specific seed money loans. PHFA encourages all rental housing development applications to include Low Income Housing Tax Credits to raise equity for their projects.

   In addition, PHFA receives additional HOME funds for the HOMESTEAD program. The program offers down payment and closing cost assistance to first-time homebuyers. HOMESTEAD loans are distributed through participating banks throughout the State. The program will make it easier for lower income families and single persons with disabilities to purchase homes of their own. The program is also targeted to HOME nonparticipating jurisdictions. Qualifying homebuyers can borrow between $1,000 and $15,000 to help with down payments and closing costs. The HOMESTEAD loans are no-interest second mortgage loans that require no repayment as long as the buyer lives in and owns that home. Borrowers are expected to pay at least 3% of the price of the house, PHFA will provide the remainder of the down payment and closing costs. More than 50 lenders are participating Statewide. For more information about the HOMESTEAD Program, including eligible areas and the names of participating lenders, call the toll-free mortgage hot line at 1 (800) 822-1174 between 8 a.m. and 4:30 p.m., Monday through Friday.

Program Changes

   HUD identified the following as HOME participating jurisdictions for 1995. It is expected that changes will occur in this list as HUD completes the allocation of 1996 HOME funds.

   Allegheny County
City of Allentown
City of Altoona
Beaver County
City of Bethlehem
Berks County
Bucks County Consortium
Chester County
Delaware County Consortium
City of Erie
City of Harrisburg
City of Johnstown
City of Lancaster
Lancaster County
Luzerne County Consortium
Montgomery County
City of Philadelphia
City of Pittsburgh
City of Reading
City of Scranton
Washington County
Westmoreland County Consortium
City of Williamsport
City of York
York County

HOME Regulatory Changes

   On July 12, 1995, the U. S. Department of Housing and Urban Development published the Seventh Interim HOME Rule. Unlike previous Interim Rules, most of the changes clarified existing regulations. Among the more significant changes were:  allowing the acquisition of existing hotels and residential structures to be used as HOME eligible single room occupancy facilities without either food preparation or sanitary facilities in each unit; allowing HOME funds to capitalize loan guarantee funds; clarifying the match credit generated by locally waived fees and charges, and those fees and charges foregone by public or private institutions; and in homebuyer programs, allowing for the reduction of the HOME amount to be recaptured based on the length of time the recipient has owned and occupied the unit. Applicants should review this edition of the HOME Interim Rule for more information.

   HUD expects to finalize the HOME Rule in 1996. It is expected to include additional changes when finally published. Among the changes anticipated are:  1) addition to the types of financing eligible; 2) additions to the types of eligible match; 3) simplication of the ongoing monitoring responsibilities of participating jurisdictions; 4) adjusting the definition of what is a ''project''; 5) additional options for defining income; and 6) clarifying the requirements for written agreements.

Community Housing Development Organizations

   The Commonwealth, as a participating jurisdiction, is required to set-aside a minimum of 15% from its total allocation to support projects submitted by Community Housing Development Organizations (CHDOs). CHDO organizations that are pursuing rental housing development projects of five units and more are to apply directly to PHFA. The Department will accept applications for CHDO activities submitted by local governments for rental projects of four units or less, and for homebuyer projects during the application period discussed in Section III. Applicants proposing this type of HOME CHDO set-aside funding must demonstrate that they are acting as developer, owner or sponsor of the affordable housing project.

   Local governments may submit applications on behalf of CHDOs for CHDO operating support, technical assistance and site control loans and seed money loans at anytime. The application forms to be used for these requests are contained in these guidelines. Up to 5% of the Commonwealth's HOME funds may be used for CHDO Operating Expenses, defined as necessary and reasonable costs for the operation of the CHDO. For any fiscal year, a CHDO may not receive more than 50% of its total operating budget in the fiscal year, or $50,000 annually, whichever is greater. When an application is submitted to the Department for an eligible CHDO set-aside homebuyer project, or a one to four unit rental project, operating expenses should be simultaneously requested.

   Project specific technical assistance and site control loans--The purpose of these loans is to determine the feasibility of CHDO set-aside eligible projects. Loans are limited to the following purposes:

   --consulting, legal, engineering and/or architectural fees

   --preliminary financial applications

   --initial feasibility studies

   --engaging a development team

   --site control and title clearance

   Project specific seed money loans--The purpose of these loans is to cover eligible project expenses prior to the start of construction. Uses of the loan proceeds include, but are not limited to the following:

   --firm construction loan commitment

   --architectural plans and specifications

   --zoning approvals

   --engineering studies

   --legal fees

   All loans must not exceed customary and reasonable project preparation cost. The maximum loan amount is $2,000 per unit up to $25,000. Loans must be repaid at the construction loan closing CHDO predevelopment loans cannot be ''rolled over'' into the permanent financing.

   For more information concerning application requirements for CHDO operating support, project specific technical assistance and site control loans and seed money loans, the Operating and Predevelopment Assistance for Pennsylvania Certified Community Housing Development Organizations guidelines should be consulted.

   In order to receive CHDO set-aside funding, or CHDO operating expenses not related to a specific project, a nonprofit must first be certified by DCA as a CHDO. Applications for CHDO certification will be accepted anytime. Organizations already certified by DCA as a CHDO must update their certifications for each year in which funds are sought. Such organizations should contact the appropriate Regional Office.

Eligible Activities

   HOME funds may be used for a variety of activities to develop and support affordable housing. Eligible activities include:  assistance to homebuyers and existing homeowners; property acquisition; new construction; rehabilitation; site improvements; demolition; relocation expenses; tenant-based rental assistance; other reasonable and necessary expenses related to the development of modest housing; the refinancing of certain existing owner occupied units; and the purchase and placement of elder cottage housing opportunity units.

   The Commonwealth's HOME program allows up to 6% of the HOME award to be used to pay for administrative costs. Staff and overhead costs attributable to a HOME assisted project may be charged to projects costs as project delivery, or to general administration. However, such costs may not be charged against project delivery if the unit or family is not assisted with HOME funds.

   Applicants proposing tenant based rental assistance (TBRA) programs should be aware that HOME funds are limited to a 2-year period of assistance. These programs should include a description of how the tenant based assistance will continue after the HOME assistance period terminates; identify additional funding sources to address the limited duration of the HOME assistance; or use HOME funds as a bridge to permanent housing for families about to be self-sufficient or soon to obtain housing through another program.

   Activities prohibited under the HOME Program include:  public housing modernization; tenant subsidies for certain special mandated purposes under section 8; matching funds for other Federal programs; Annual Contributions Contracts (ACC); activities under the Low-Income Housing Preservation Act of 1987 and 1990; the acquisition of certain real property owned by a State recipient and operation subsidies for rental housing.

Program Income

   All programs should be structured to maximize the return of program income to the Commonwealth. For example, in a homeowner rehabilitation program, a deferred payment 0% loan due on sale achieves the same purpose as a grant yet returns dollars to the Commonwealth for affordable housing. Locally revolving loan programs will not be permitted.

Matching Requirements

   All activities require a 25% match. Match must be permanently contributed to HOME assisted or HOME eligible housing. Generally, match must be for HOME eligible expenses. Selected applicants for HOME funds will be required to report on the expenditure of match at the time the match can be recognized. The Department is currently seeking guidance from HUD on the reduction of the matching requirements as a result of the Presidential disaster declaration.

Submission Dates

   The Department of Community Affairs will accept applications through the five DCA Regional Offices (addresses appear at the end of this notice). One original and two copies of the application must be received in the Regional Office, with one copy to the Central Office by the close of business May 31, 1996. No applications will be accepted after 5 p.m., May 31, 1996. Transmittals by facsimile (fax) machine will not be accepted.

Training Sessions

   The Department will conduct a 1/2 day workshop at three locations during the month of April. The HOME session will take place from 1:30 p.m. to 4:00 p.m. at the following locations:

   April 1--Holiday Inn Scranton/East Dunmore, 200 Tigue Street, I-380 Exit 1 (Tigue Street), (717) 343-4771

   April 8--Holiday Inn--Harrisburg/Hershey Area, I-81 at Exit 28, (717) 469-0661

   April 10--Days Inn Conference Center Butler, 139 Pittsburgh Road, PA Turnpike Exit 4 to Route 8 North, (412) 287-6761

Application Forms

   Application forms and instructions may be obtained by contacting the Department's regional offices. Persons with a disability who wish to submit an application in accordance with the provisions stated herein and who require assistance with that application and persons who require copies of this notice in an alternative format (large type, braille, and the like) should contact David Chittister, Room 507 Forum Building, Harrisburg, PA 17120, telephone (717) 787-7156 to discuss how the Department may best accommodate their needs. The following is the listing of DCA Regional Offices and the counties they serve:

Region 1--Southeast

   Bucks, Chester, Delaware, Montgomery and Philadelphia counties

Department of Community Affairs
908 State Office Building
Broad and Spring Garden Streets
Philadelphia, PA 19130
(215) 560-2256

Region 2--Northeast

   Berks, Bradford, Carbon, Lackawanna, Lehigh, Luzerne, Monroe, Northampton, Pike, Schuylkill, Sullivan, Susquehanna, Tioga, Wayne and Wyoming counties

Department of Community Affairs
201 Samters Building
101 Penn Avenue
Scranton, PA 18503-2025
(717) 963-4571

Region 3--Southcentral and Region 4--Northcentral

   Region 3--Adams, Cumberland, Dauphin, Franklin, Lancaster, Lebanon, Perry and York counties

   Region 4--Bedford, Blair, Cambria, Centre, Clinton, Columbia, Fulton, Huntingdon, Juniata, Lycoming, Mifflin, Montour, Northumberland, Snyder, Somerset and Union counties.

Department of Community Affairs
402 Finance Building
Harrisburg, PA 17120
(717) 787-7347

Region 5--Southwest

   Allegheny, Armstrong, Beaver, Butler, Fayette, Greene, Indiana, Washington and Westmoreland counties

Department of Community Affairs
413 State Office Building
300 Liberty Avenue
Pittsburgh, PA 15222
(412) 565-5002

Region 6-Northwest

   Cameron, Clarion, Clearfield, Crawford, Elk, Erie, Forest, Jefferson, Lawrence, McKean, Mercer, Potter, Venango and Warren counties

Department of Community Affairs
Third Floor--Rothrock Building
121 West 10th Street
Erie, PA 16501
(814) 871-4241

Central Office

505 Forum Building
Harrisburg, PA 17120
(717) 787-7156


[Pa.B. Doc. No. 96-490. Filed for public inspection March 29, 1996, 9:00 a.m.]

No part of the information on this site may be reproduced for profit or sold for profit.

This material has been drawn directly from the official Pennsylvania Bulletin full text database. Due to the limitations of HTML or differences in display capabilities of different browsers, this version may differ slightly from the official printed version.