For-profit developers, non-profit developers, local housing authorities and municipalities in cooperation with for-profit or non-profit developers are eligible to apply for HSF funds.
Eligible Activities and Affordability Requirements
- HSF monies can be used for the acquisition and/or rehabilitation of existing structures for rental use, including distressed or failed properties, or for the new construction of rental projects.
- Projects seeking HSF funds must have a minimum of 5 HSF-assisted units.
- All units receiving HSF assistance must be occupied by households with incomes no greater than 80% of the area median income during the first 40 years.
- During years 41 through 50, HSF assisted units maybe occupied by households with incomes no greater than 100% of area median income.
- Developers are permitted to charge up to the Low Income Housing Tax Credit (LIHTC) rents in HSF units only upon initial rent-up and upon unit turnover.
- Please note that units funded with HOME and HSF must comply with HOME rent rules.
- Please see the additional rent information and program guidelines below.
- DHCD will award the lesser of $1,000,000 per project and up to $50,000 per HSF-assisted unit in HOME entitlement/consortium communities.
- In non-entitlement or non-consortium communities, the maximum award is up to $65,000 per HSF-assisted unit, up to a per project maximum of $1,000,000.
- Please see list of entitlement and consortium communities on the HOME Investment Partnerships Program page.
- Projects located in HOME entitlement or consortium communities must include a matching commitment of local funds, or the application will not be scored. In general, preference will be given to applications with full match commitments.
- In general, HSF monies are structured as a 50-year deferred payment loan at 0% interest.
- DHCD reserves the right to structure the loan with an interest rate above 0% to any HSF loan.
- In addition, projects receiving allocations of Low Income Housing Tax Credits in combination with HSF may be structured with an interest rate acceptable to DHCD set at the time of closing.
- All HSF loans are non-recourse and secured by a mortgage on the property.
- strength of overall concept
- strength of development team
- demonstrated need for project in the target neighborhood
- suitable site and design
- appropriate scope of rehabilitation or construction
- appropriate total development cost for properties included in proposal
- financial viability of the project
- degree of local support, including local funding commitments
- evidence of readiness to proceed
- evidence of satisfactory progress on projects previously funded with DHCD resources
- certification in accordance with Executive Order 418
- incorporation of sustainable development