Item 28 - Fiscal Year 2023-24 Request for Proposals for Affordable Homeownership Opportunities

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EXHIBIT 2 Revision 10 -ADD Page 28, Eligible Projects Projects eligible for HOME funding shall: 1) be an affordable homeownership or rental project located in the City of Santa Ana; Revision 11 -ADD Page 28, Eligible Uses and Activities HOME funds may en4�-be used to finance new construction or acquisition and/or rehabilitation of single family ownership housing which is affordable to low-income households as defined by 24 CFR 92.2. HUD defines "Single Family Housing" as a one -to -four family residence, condominium unit, cooperative unit, combination of manufactured housing and lot, or manufactured housing lot. HOME funds may also be used to finance new construction or acquisition and/or rehabilitation of rental housing which is affordable to very low and low-income households as defined by 24 CFR 92.2. Fifteen percent (15%) of the annual HOME fund allocation shall be set aside for certified Community Housing Development Organizations (CHDO's). New construction costs eligible for HOME funding shall be as specified in 24 CFR Part 92, including: 1) site acquisition; 2) site preparation costs (grading, filling, etc.); 3) financing costs as described in 24 CFR 92.206; 4) architectural, engineering, and other related soft costs; 5) the cost of extending or upgrading utilities to the site to support the proposed project; 6) construction costs; 7) relocation costs; and, 8) affirmative marketing and audit costs related to HOME program requirements. Rehabilitation costs eligible for HOME funding include: 1) project acquisition with or without rehabilitation; 2) financing costs, as described in 24 CFR 92.206; 3) architectural, engineering, or other design costs; 4) utility upgrade or extension costs; 5) costs associated with demolition (where necessary) only if rehabilitation is commenced within 12 months of demolition; 6) construction costs; 7) project audit costs; and, 8) affirmative marketing costs. Revision 12 - ADD Page 29, Rental Affordability Requirements HUD provides the following maximum HOME rent limits. The maximum HOME rents are the lesser of: 1) The fair market rent for existing housing for comparable units in the area as established by HUD; or 2) A rent that does not exceed 30 percent of the adjusted income of a family whose annual income equals 65 percent of the median income for the area, as determined bV HUD, with adjustments for number of bedrooms in the unit. The HOME rent limits provided bV HUD will include average occupancy per unit and adjusted income assumptions. In rental Droiects with five or more HOME -assisted rental units. twentv (20) percent of the HOME -assisted units must be occupied by very low-income families and meet one of following rent requirements: 1) The rent does not exceed 30 percent of the annual income of a family whose income equals 50 percent of the median income for the area, as determined by HUD, with adjustments for smaller and larger families. HUD provides the HOME rent limits, which include average occupancy per unit and adjusted income assumptions. However, if the rent determined under this paragraph is higher than the applicable rent under 24 CFR 92.252(a), then the maximum rent for units under this paragraph is that calculated under 24 CFR 92.252(a). 2) The rent does not exceed 30 percent of the family's adjusted income. If the unit receives Federal or State project -based rental subsidy and the very low-income family pays as a contribution toward rent not more than 30 percent of the familV's adjusted income, then the maximum rent (i.e., tenant contribution plus project -based rental subsidy) is the rent allowable under the Federal or State project -based rental subsidV program.