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EXHIBIT 1 <br />CFR 92.2. Fifteen percent (15%) of the annual HOME fund allocation shall be set aside for <br />certified Community Housing Development Organizations (CHDO's). <br />New construction costs eligible for HOME funding shall be as specified in 24 CFR Part 92, <br />including: <br />1. site acquisition; <br />2. site preparation costs (grading, filling, etc.); <br />3. financing costs as described in 24 CFR 92.206; <br />4. architectural, engineering, and other related soft costs; <br />5. the cost of extending or upgrading utilities to the site to support the proposed project; <br />6. construction costs; <br />7. relocation costs; and, <br />8. affirmative marketing and audit costs related to HOME program requirements. <br />Rehabilitation costs eligible for HOME funding include: <br />9. project acquisition with or without rehabilitation; <br />10. financing costs, as described in 24 CFR 92.206; <br />11. architectural, engineering, or other design costs; <br />12. utility upgrade or extension costs; <br />13. costs associated with demolition (where necessary) only if rehabilitation is <br />commenced within 12 months of demolition; <br />14. construction costs; <br />15. project audit costs; and, <br />16. affirmative marketing costs. <br />Ineligible Uses and Activities <br />The following costs are not eligible for HOME funding: <br />1. project reserve accounts for replacement or operating reserves, and operating <br />subsidies; <br />2. payment of impact fees; <br />3. land banking; <br />4. emergency repair or weatherization programs; <br />5. commercial properties; <br />6. temporary shelters; or <br />7. project -based rental assistance. <br />Affordability Requirements <br />HUD provides the following maximum HOME rent limits. The maximum HOME rents are the <br />lesser of: <br />1. The fair market rent for existing housing for comparable units in the area as established <br />by HUD; or <br />2. A rent that does not exceed 30 percent of the adjusted income of a family whose annual <br />income equals 65 percent of the median income for the area, as determined by HUD, with <br />adjustments for number of bedrooms in the unit. The HOME rent limits provided by <br />HUD will include average occupancy per unit and adjusted income assumptions. <br />Affordable Housing Funds Policies and Procedures Page 29 <br />FoorlyffiN <br />