Open Window Request for Proposals. Rural & Urban Community Investment Fund. New York State Homes & Community Renewal. Revised April 2015

Transcription

1 ANDREW M. CUOMO Governor DARRYL C. TOWNS Commissioner/CEO Open Window Request for Proposals Rural & Urban Community Investment Fund New York State Homes & Community Renewal Revised April 2015 SECTION I. Introduction Under this Open Window Request for Proposals ( RFP ), New York State Homes & Community Renewal ( HCR ), acting through the Housing Trust Fund Corporation ( HTFC ), invites qualified applicants to apply for Rural and Urban Community Investment Funds ( CIF ) to support retail, commercial or community facility components of mixed-use affordable housing developments in urban and rural communities statewide, as well as to support preservation of existing affordable multifamily housing in rural areas of the State. This RFP describes the programmatic and submission requirements for the CIF Program. Under this RFP, applications will be accepted for consideration on a continuous basis until funds are no longer available for award or until HCR terminates or suspends the RFP. Prospective applicants may request technical assistance at any time. Table of Contents: This Request for Proposals consists of the following seven sections: Section I, Introduction, provides a brief explanation of the program and description of the open window application process. Section II, Rural and Urban Community Investment Fund Summary, provides a description of the CIF program and the funding opportunities available under this RFP. Section III, Application Submission Information and Review Process, provides information on application submission procedures and documentation that must be submitted to HCR. 1

2 Section IV, Eligible Project Activities and Related Requirements, provides additional technical guidance on how CIF may be utilized. Section V, General Program Requirements, provides information on additional HTFC requirements. Section VI, Evaluation and Selection Criteria, provides information on the application review process. Section VII, HCR Regional Office Service Areas, provides contact information for HCR Offices so that applicants can access technical assistance in preparing applications. SECTION II. Rural and Urban Community Investment Fund Summary A. Availability/Funding Limits The Community Investment Fund statute, Article XXVII of the Private Housing Finance Law, provides that 60 percent of CIF awards will be allocated to projects located in Urban Areas of the State, with the remaining 40 percent of awards allocated to projects located in Rural Areas of the State. As additional funding is made available for CIF, HCR will issue notices of funding availability identifying amounts applicable to rural and urban areas based on the statutory formula. HCR expects to award a portion of these funds under this RFP based on the responsiveness of applications to the priorities and scoring criteria outlined herein. B. Eligible Program Activities Applicants may seek CIF funds for either the new construction or rehabilitation of retail, commercial, or community facility space that is or will be part of or which is in close proximity to and clearly serves the needs of tenants residing in Affordable Residential Development financed by an HCR agency. CIF funds may also be used for the preservation of multifamily affordable housing in rural areas of the State (Rural Preservation Projects) that may or may not have a retail, commercial or community facility space. For the purposes of this RFP, Affordable Residential Development is defined as a project seeking or previously awarded HCR assistance and which includes, at a minimum, seventy percent (70%) residential units that are rent restricted and occupied by households whose incomes are at or below ninety percent (90%) of area median income applicable to the county in which a project is located. For the purposes of this RFP, a project will be considered to be seeking HCR assistance if it currently has an application for residential financial assistance pending before the agency. C. Eligible Applicants Eligible applicants include not-for-profit corporations or charitable organizations, or a wholly owned subsidiary of such corporations or organizations, or private for-profit developers. 2

3 D. Eligible Areas Rural Areas shall mean cities, towns and villages having a population of less than 25,000 as determined by the last decennial census. Use this link to the US Census Bureau for population estimates - Urban Areas shall mean any unit of local government within the State with a population of more than or equal to 25,000 as determined by the last decennial census. Use this link to the US Census Bureau for population estimates - E. Matching Requirements Pursuant to the CIF statute, applicants are required to provide a 1/3 match of the requested funding amount including but not limited to cash, developer equity, deferred developer fee, donated property, materials or labor and other resources as qualified in the application s development budget and supported by the funding commitment documentation. Applicants considering CIF funding must schedule a pre-application technical assistance meeting with HCR staff to discuss potential matching sources. The match requirement may be reduced or eliminated because the project is located within a declared disaster area and the proposed project clearly addresses an impact resulting from the disaster. Applicants seeking a reduction or elimination of the CIF matching requirement must request a waiver detailing the basis for the reduction or elimination at least 10 business days prior to the application submission. F. Rural Preservation Projects Unless otherwise noted in this Request for Proposals, the scope of the rehabilitation on a Rural Preservation Project must be sufficient for the project to function in good repair as affordable housing for a period equal to at least 30 years from the date of issuance of the final credit allocation. G. CIF Funding Priorities HCR will give priority to applications that most clearly document that CIF funds will be used: To subsidize the development or rehabilitation of retail, commercial or community facility space which will be used to address a critical unmet community need in the development s primary market area (e.g. access to health care, affordable fresh foods, services for low income seniors, educational opportunities, job opportunities, daycare for working families). Applicants must demonstrate that without CIF funding the proposed tenant could not otherwise pay market rent or pay rent sufficient to cover the cost of developing and operating the space. To finance the development or rehabilitation of retail, commercial or community facility space to ensure the continuation of traditional commercial corridors that would otherwise be disrupted by the development of ground floor residential space. Applicants must demonstrate that without CIF funding, market rents would be insufficient to cover the costs of developing and operating the space. To finance the development or rehabilitation of retail, commercial or community space (a) as part of a concerted neighborhood revitalization plan or (b) has been specifically endorsed in the Regional Economic Development 3

4 Council Strategic Plans. Such plan must clearly support the proposed use of the space and must identify local actions that have been taken or are proposed to be undertaken to attract or promote the proposed use, including but not limited to tax relief measures, changes in zoning, and infrastructure investments directly benefiting the space. Applicants must demonstrate that without CIF funding, market rents would be insufficient to cover the costs of developing and operating the space. To finance the rehabilitation of rural affordable housing projects on scattered sites that have been bundled in order to leverage federal 4% low income housing credits. To finance rural preservation projects currently receiving Rural Rental Assistance Program ( RRAP ) funds. Applications under this priority must propose a scope of work that extends the expected useful life of the project by no less than 30 years and satisfies heightened energy efficiency standards specified by HCR. Successful applications must demonstrate that the rehabilitation will be undertaken as part of a plan of finance that will result in ongoing reductions of RRAP funding, and that at least 90 percent of the proposed total project costs will be directly related to physical improvements to the project. The only source of HCR funding that may be requested under this priority is the CIF. Requests under this priority may request up to $2,000,000 million in CIF funds, and $40,000 per unit, and must satisfy all CIF program requirements described in this RFP. To finance Disaster Relief Projects in communities directly impacted by Federal Emergency Office declared disasters, including, but not limited to, Superstorm Sandy, Hurricane Irene, Tropical Storm Lee, and the Summer 2013 Severe Storms and Flooding. When CIF is combined with another HCR program, the agency will take into account the extent to which the project advances the priorities of that other program. SECTION III. Application Submission Information and Review Process A. Application Submission: Applications for CIF may be submitted at any time of the year until the date of notice that all available funds are committed. In addition to meeting the general application requirements described herein, applicants will need to schedule a mandatory pre-application conference with the appropriate HCR Regional staff listed in Section VII of this RFP. Under this RFP applicants may apply for CIF funding using the Community Development On-Line ( CDOL ) Application System located at Applicants who have already submitted a complete application for financing through CDOL or through HCR s 641 Lexington Office in Manhattan may request that previous submissions be used in place of a new CDOL application for CIF funds. In connection with applications that involve tax-exempt bond financing, applicants may contact: Leonard Gruenfeld at or 4

5 Roger Harry at for detailed instructions on this application alternative. All other inquiries on this application alternative should be directed to HCR regional and program staff identified at the end of this RFP. Applicants applying online should refer to the CDOL Application System and Instructions to determine the specific Exhibits and Attachments that must be submitted when applying for the program. Application reviews and award decisions will be made on an ongoing basis. HCR will make final selections and will advise successful and unsuccessful applicants of its decisions. Unsuccessful applicants may request an exit conference with HCR Regional Office staff to review their application. HCR reserves the right to award all, a portion of, or none of the program funds based upon funding availability, feasibility of applications received, the competitiveness of the applications, the applicant s ability to meet HCR criteria for funding, the applicant s ability to advance the State s housing goals, and HCR s assessment of cost reasonableness. HCR further reserves the right to review an application requesting project funds as an application for funding under other programs for which the project is eligible, and to change or disallow aspects of the applications received. HCR may make such changes an express condition of its commitment to fund the project. When available funds are fully committed and/or HCR decides to terminate or suspend the acceptance of applications, a notice will be posted on HCR s website. Applicants are urged to check HCR s website ( or contact HCR staff prior to completing and submitting an application to determine whether proposals are currently being accepted. SECTION IV. Eligible Project Activities and Related Requirements A. Non-Residential Underwriting Considerations 1. Applicants should demonstrate in the operating budget and market documentation that CIF funds will reduce debt service costs such that marketrate commercial leases will be sufficient to cover all debt service and operating costs associated with the non-residential space. In developing the operating budget, applicants must assume an industry standard vacancy rate of 10 percent for the non-residential space. 2. CIF funds may be used only to cover development costs. CIF funds may not be used to support ongoing operating costs. Income from the residential component of projects may not be used to support the operations of commercial, retail, and/or community facility space. 3. Applicants must provide a market analysis clearly demonstrating that there is sufficient demand for the proposed non-residential use at rents assumed in the income and operating budget. The market analysis must include information about the existing market and detail the commercial rents (including per square foot cost) of comparable commercial space in the immediate market 5

6 area. The application must also include a complete Attachment F 15 - CIF Project and Market Information. At the sole discretion of the agency, HCR may consider other information in assessing market demand for nonresidential space. 4. Applicants must provide at least one letter of interest or commitment from a prospective tenant for the non-residential space. Additional letters and/or firm commitments from prospective tenants are strongly encouraged. Such letters and/or commitments must identify the amount per square foot such prospective tenant would be willing to pay for the finished space. 5. Successful applicants will be required to enter into a master lease for the nonresidential component of the project or otherwise ensure to the satisfaction of the agency that sufficient income will be available to cover the operating costs and debt service of the non-residential space in the event the space is not leased. Because non-residential space is not subject to rent restrictions, the agency may disallow the use of CIF funds in connection with projects that budget a developer fee for the retail, commercial or community facility portion of a project. 6. Successful applicants will be required to submit a cost certification for HCR review and approval of conversion from construction financing to permanent financing. B. Residential Underwriting Considerations CIF funds may only be used only to cover costs related to the rehabilitation of affordable rural housing projects. CIF funds may not be used to support the ongoing operating costs. Successful applicants will be required to submit a cost certification for HCR review and approval of conversion from construction financing to permanent financing. Rural preservation projects that are funded in combination with 4% Low Income Housing Tax Credits and tax-exempt bonds must satisfy all underwriting criteria associated with those funding sources. Rural preservation projects that do not rely on federal low income housing tax credits must satisfy all the underwriting criteria that would apply to stand-alone Low Income Housing Trust Fund applications outlined in the HCR Capital Programs Manual. For projects that are co-funded with USDA Rural Development, HCR will consider utilizing underwriting criteria that appropriately address the requirements of both agencies. C. Design Considerations 1. The commercial, retail, community facility portion of a project will be required to comply with the local building code and provide a separation of utilities between the residential and non-residential components of a project. All metered utilities must be separate systems between the residential and non-residential spaces. Examples include separate HVAC systems with separate boilers/ac units, separate electrical systems, separate domestic hot water systems, etc. HCR will entertain requests for alternative means of accomplishing a separation of utilities. Successful applicants must post 6

7 signage identifying the participation of the State of New York consistent with specifications listed on the HCR website. Where appropriate, HCR may require the use of lead-safe work practices during renovation, remodeling, painting, and demolition. 2. Rural preservation projects that rely on federal 4% low income housing credit must satisfy the design requirements specified by the issuer of the tax credit. 3. Rural preservation projects that do not rely on federal low income housing tax credits must comply with the HTFC Design Handbook. For projects that are co-funded with USDA Rural Development, HCR will seek to appropriately address the design requirements of both agencies. D. Regulatory Term The commercial, retail or community facility space financed with CIF funds will be subject to a regulatory term that is coterminous with any HCR regulatory agreement on the project s affordable residential component or ten years. E. Funding Limits Unless otherwise noted in this RFP, applicants using CIF to develop new or rehabilitate non-residential space (Retail, Commercial, Civic or Community Service Facilities) may request the lesser of up to $1,500,000 per project or the amount needed to ensure that market rents would be sufficient to cover the cost of financing and operating the space of the project. Applicants using CIF to rehabilitate rural affordable housing may request the lesser of up to $2,000,000 per project or the amount needed to ensure that rents would be sufficient to cover the cost of financing and operating the project. F. Application Submission Requirements See CDOL Application System and CIF CDOL Application Instructions for the specific Exhibit and Attachments that must be submitted in order for an application to be considered for funding. Applicants who have already submitted a complete application for financing through CDOL or through HCR s 641 Lexington Office in Manhattan may request that previous submissions be used in place of a new CDOL application. In connection with applications that involve tax-exempt bond financing, applicants may contact: Leonard Gruenfeld at or Roger Harry at for detailed instructions on this application alternative. All other inquiries on this application alternative should be directed to HCR regional and program staff identified at the end of this RFP. G. Loan Terms - Under this program, CIF awards will, at a minimum, be structured as a 1% deferred loan payable annually from available cash flow. HCR may consider other loan repayment terms based on the particular financial circumstances and market conditions related to individual applications for assistance. HCR may consider requests to use CIF funds as a source of construction financing if an applicant demonstrates to the satisfaction of the agency that alternative sources of financing are unavailable. H. Threshold Application Requirement Applicants proposing the development or redevelopment of non-residential space must demonstrate successful past experiences in 7

8 developing and managing mixed-use affordable housing projects in comparable markets. All applicants must schedule and participate in a pre-application meeting with HCR staff to describe their proposal and respond to all preliminary request for information from the agency. I. HCR reserves the right to include restrictive language in the CIF regulatory agreement and/or the CIF funding commitment to ensure the acceptability of non-residential tenants. HCR may also require as a condition of award that successful applicants lease all or part of the non-residential space prior to permanent financing closing. J. Other Assistance Offer of a limited amount of Project Based Voucher ( PBV ) assistance, depending upon availability, for proposed projects seeking CIF under this competitive Request for Proposals. As authorized by program regulations at 24 CFR 983, HCR may offer a limited amount of PBV assistance, depending upon availability, for proposed projects seeking CIF under this competitive Request for Proposals. Applications seeking consideration for PBV assistance in combination with CIF will be reviewed for eligibility, scored and underwritten at the end of each month. All complete and eligible applications requesting PBVs will be competitively selected. This competitive review process will be repeated at the end of each calendar month. A complete description of all applicable PBV program regulations can be found within the Electronic Code of Federal regulations at: (Title 24, Part 983). Applicants interested in being considered for PBV assistance should fully review program regulations prior to making application in order to ensure that their proposed project is consistent with all terms and provisions of those regulations. Applicants are advised to carefully examine the subsidy layering review guidelines relative to PBV assistance issued by HUD in its notice of July 9, These guidelines establish certain development and operations standards that must be adhered to by projects receiving PBVs, including limits on builder s fees, developer s fee, and project cash flow. The guidelines can be found at: HCR will give priority to those projects requesting PBVs with a proposed developer fee at or below the HUD safe harbor standard of 12% of the total development cost. Applicants are invited to submit proposals for the use of PBVs in connection with the preservation of rental units in only those local program areas serviced by HCR s Section 8 Voucher Program and its network of Local Administrators. A complete listing of those local program areas can be found on the HCR website at: 8

9 Applications requesting project based assistance only will not be accepted. Requests for PBV assistance must be accompanied by a request for assistance for CIF. Only applications submitted in response to this RFP will be considered for this PBV assistance. HCR requires all applicants seeking PBVs to provide information on the degree to which PBVs enable a project to serve a lower income population than the project would otherwise be capable of serving absent the PBVs. A detailed description of the impact PBVs will have on the population served must be provided in an application seeking PBV assistance. The description must be provided in a Proposal Summary as part of the response to the question of what public purpose is served by the project and who the project beneficiaries will be. Regulations generally limit PBV assistance to no more than 25% of the units in a project. Projects serving persons who are elderly (62 years or older), persons with disabilities or families receiving supportive services generally equivalent to HUD Family Self-Sufficiency programming may be allowed to exceed the 25% per building cap. All applicants for PBVs must comply with the Federal National Environmental Protection Act ( NEPA ) as implemented through 24 CFR 58, and the New York State Environmental Quality Review Act ( SEQRA ). Davis-Bacon wage requirements are applicable to construction of all projects receiving nine or more PBVs. SECTION V. General Program Requirements State Environmental Quality Review ( SEQR ) All applicants must attach a copy of the signed Short Environmental Assessment Form ( EAF ) in order to comply with SEQR procedures. A version of this form can be filled out online at New York State Division of Environmental Conservation s ( DEC ) website ( ) and then printed for signature. If the applicant is aware that the project scope constitutes a Type I Action, the full EAF must be submitted. If another organization/agency has assumed the lead agency designation for coordinated review, submit a copy of the EAF reviewed by that lead agency, written documentation that a coordinated review has been or will be conducted, a copy of the Negative Declaration and, if applicable, attach the correspondence from the lead agency which identifies HTFC as an involved agency. If any Phase 1 Environmental Site Assessments ( ESA )/reports were completed in the past year, submit a copy of the Executive Summary of these documents. HCR reserves the right to request full copies of the ESA/reports. 9

10 State Historic Preservation Submissions ( SHPO ) The State Historic Preservation Office is required to review all state or federally funded new construction or rehabilitation projects to determine whether the proposed project is of historic, architectural or archaeological value or would adversely affect any district, site, building or other structure which is listed, or eligible to be listed, in the National Register of Historic Places. SHPO is also required to make recommendations on issues of design or construction that best protect the historic quality of a building, site or district. Once a site has been listed, or is eligible for listing in the Register, or is within an existing or eligible historic district, no site action affecting historic resources can proceed once application is made, or is anticipated to be made by the project sponsor, for state or federal funding, without consultation of the SHPO. Project sponsors must initiate the SHPO review process prior to applying for funds by submitting a Project Review Cover Form, and a Historic Resources Inventory Form (if applicable) directly to SHPO together with the SHPO Transmittal Letter provided in the project application. The SHPO may ask the applicant for further information regarding the existing site or proposed project design in order to make its determination. Use of Contractors on Federal or State Debarment Lists is Prohibited Applicants and their contractors and subcontractors must agree not to contract for any services related to the project with any entity that is on any Federal or New York State debarment list, or otherwise is prohibited from bidding on, or receiving government contracts. Equal Employment Opportunity/Minority and Women Owned Business Enterprises Under Article 15A of the New York State Executive Law, all award recipients and their contractors are required to comply with the equal employment opportunity provisions of Section 312 of that Article in any instance in which an award of funds includes state-funded construction costs in excess of $100,000. Preference will be given to applicants that include a New York State certified Minority Women-Owned Business Enterprise as a member of the development team. Also, all contractors and awardees are required to make affirmative efforts to ensure that New York State Certified Minority and Women-Owned Business Enterprises are afforded opportunities for meaningful participation in projects funded by HTFC pursuant to Section 313 of the Article. SECTION VI. Evaluation and Selection Criteria A. General Review Criteria In addition to considering scoring and consistency with the CIF Funding priorities, HTFC will consider whether a proposed project advances State housing goals and helps achieve a geographic distribution of funding throughout the State. When considering project applications, HTFC will take into account the extent to which an application advances a coordinated government investment, including priority investments funded by Regional Economic Development Councils. In addition, HCR will consider projects costs as well as the proximity of a proposed project to locally undesirable land uses which expose residents to negative physical, chemical, biological, social and/or cultural factors when making award 10

11 decisions. In general, HCR will fund projects that are consistent with the historic character and density of the surrounding neighborhood. B. Applicant Past Performance An applicant s past and current performance in State programs and contracts, including their performance under Article 15A of the New York State Executive Law, will be considered in reviewing, rating, and ranking its application. HCR reserves the right to not issue an award to any applicant if it has been determined that the applicant is not in compliance with existing State contracts and has not taken satisfactory steps to remedy such non-compliance. When evaluating applications, HCR will take into consideration its experiences with a project s development team on previously-awarded projects, including projects that were delivered with significant delays, cost increases, or change in project scope from what was presented at the time of application. As a condition of application submission, HCR will require the Project Developer, General Contractor, Architect and Housing Consultant to provide authorization for HCR to conduct credit and Lexis/Nexis reviews. C. Review Process and Steps The review process will begin immediately for applications submitted through the CDOL. Review of all other applications will begin when a complete application and all required attachments are submitted to the CIF Program Manager. 1. Eligibility Review The application will be reviewed for eligibility based on the requirements laid out in the statute. 2. Feasibility Review An underwriting feasibility review will be performed to determine whether the proposed financing and operating assumptions are valid, supported by the materials provided in the application, and consistent with the underwriting requirements stated in this RFP. 3. Rating Review Applications will be rated based on the following criteria: Retail, Commercial & Community Service Facility 1. Community Impact/Revitalization (20 points) 2. Leveraging (20 points) 3. Organization Capacity/Experience/Past Performance (20 points) 4. Consistency with Activity Priorities (20 points) 5. Readiness and Implementation (20 points) Residential Rural Preservation 1. Affordable Housing Need (20 points) 2. Rehabilitation Needs (20 points) 3. Organization Capacity/Experience/Past Performance (20 points) 11

12 4. Rehabilitation Investment as Percentage of Total Project Costs (15 points) 5. Leveraging (15 points) 6. Readiness and Implementation (10 points) D. Funding Recommendations Funding recommendations will be made for feasible projects that satisfy threshold requirements from available funds on the basis of rating, statutory distribution requirements, a geographical distribution of funds, support of the State s housing goals and other review criteria outlined in this RFP. E. HTFC Board Approval All CIF awards must be approved by the HTFC Board of Directors. F. Outcome Letters HCR expects to issue Outcome Letters when award authorizations have been approved by the HTFC Board of Directors or when CIF funds have been fully committed. G. Funding Commitment Letters Funding Commitment Letters will set forth the terms and conditions under which HTFC will provide CIF financing to the project. FCLs are expected to be issued approximately business days after an Outcome Letter is issued or at such time as the awardee and HTFC reach agreement on all FCL terms and conditions. H. Project Development Meeting Successful applications will be required to participate in a Project Development Meeting. The meeting will provide a forum for the applicant's development team and HCR to discuss the project's development timetable; the roles and responsibilities of the development team members and HCR; and the deliverables required under the terms of the executed Funding Commitment. I. Development Time Frames Successful applicants will be required to provide a detailed development timetable outlining the timing of critical development milestones and establishing a schedule for the delivery of key documents for HCR staff review. SECTION VII. HCR Regional Office Service Areas Any questions regarding this RFP or the application process should be directed to the Regional Office which serves the county in which the proposed project is located. Regional office counties and staff contacts are listed below. For projects involving 4% low-income housing tax credits and tax-exempt bonds, prospective applicants should contact the 641 Lexington Avenue Office. 12

13 641 Lexington Avenue Office 641 Lexington Avenue 4 th Floor New York, NY Leonard Gruenfeld (212) Roger Harry (212) Statewide Contact for 4% LIHC/Tax-Exempt Bond Projects Capital District Regional Office Hampton Plaza, 6th Floor State Street Albany, New York, Jay Baker, CIF Program Manager: (518) Counties Served: Albany, Clinton, Columbia, Delaware, Dutchess, Essex, Fulton, Greene, Hamilton, Montgomery, Orange, Otsego, Putnam, Rensselaer, Saratoga, Schenectady, Schoharie, Sullivan, Ulster, Warren and Washington. Buffalo Regional Office Electric Building, Suite Washington Avenue Buffalo, New York Leonard Skrill, Upstate Director of Development (716) Counties Served: Allegany, Cattaraugus, Chautauqua, Chemung, Erie, Genesee, Livingston, Monroe, Niagara, Ontario, Orleans, Schuyler, Seneca, Steuben, Wayne, Wyoming and Yates. Syracuse Regional Office 620 Erie Boulevard West, Suite 312 Syracuse, New York Leonard Skrill, Upstate Director of Development (716) Counties Served: Broome, Cayuga, Chenango, Cortland, Franklin, Herkimer, Jefferson, Lewis, Madison, Oneida, Onondaga, Oswego, St. Lawrence, Tioga and Tompkins. New York City Regional Offices 25 Beaver Street, 7th Floor New York, NY 10004, (212) Earnest Langhorne, Downstate Director of Development (212) Counties Served: Bronx, Kings, New York, Queens, Richmond, Nassau, Suffolk, Rockland and Westchester. -END OF REQUEST FOR PROPOSALS- 13