DATE: TO: FROM: SUBJECT:

January 15, 2015 Owners and Managers of HOME Projects Affordable Housing Connections Staff Report Submission Requirements - Compliance Program Year 2014

AHC monitors compliance for rental projects awarded funding under the federal HOME Program (HOME Investment Partnership Program) from the following Participating Jurisdictions (PJ): Dakota County

City of Minneapolis

Hennepin County

St. Louis County

City of Saint Paul

Program Year 2014 Annual Reports, Utility Allowance Source Documents, Owner’s Certification of HOME Project Compliance, and any updates to Owner/Management Contact Information are due to AHC BY 5:00 P.M., MONDAY MARCH 2, 2015. Upload requested items to your project’s secure folder. Upload instructions are enclosed.

PROGRAM YEAR 2014 REPORTING REQUIREMENTS FOR HOME-ASSISTED RENTAL PROJECTS Enclosed are the HOME Program Annual Report forms for calendar year 2014, which the PJ requires to be submitted by owners of rental projects funded by the HOME Program. The HOME Compliance Report spreadsheet is attached to the transmittal email and also available on AHC’s website.

1. The Owner Certification of HOME Project Compliance document is to inform owners and their authorized agents of the expectations for adhering to HUD and the PJ’s requirements for projects with HOME funding. Owners are required to certify the compliance status of the project. Please review all listed items and take any necessary action to train your project management staff to implement these requirements.  It must be clear to us that the signature is an original: please do not use black ink to sign this document. Please print, complete, and return this form to AHC no later than 5:00 p.m. on Monday March 2, 2015. Copies of the certification can be submitted by scanning and uploading to your project’s secure folder. 1

2. Provide any owner and/or management contact updates on the enclosed HOME Program Project Information sheet so that all information in our database is current and correct. OWNER AND MANAGEMENT CONTACTS AHC’s database allows ONLY two contact persons for each HOME project:  Owner Representative: authorized managing general partner representative.  Managing Agent: representative of the management company that is under contract with the owner for management responsibilities related to the project. We will not accept a consultant or other third party as an authorized management company contact. Both owner and management contacts will get email notifications of reports and letters that AHC uploads to the project’s secure folder. It is the responsibility of the project management contact with access to the secure folder to share monitoring correspondence with the owner, within their organizations and with any consultant or other third party who may be engaged for compliance support to the management company. It is the owner’s responsibility to promptly report to AHC any changes in owner and management contact persons.

3. The HOME Rental Project Compliance Report showing ALL activity that occurred during 2014 and ALL 2015 activity as of the submission date. The first tab on the spreadsheet gives detailed “Instructions to Owner” for report completion. You must use the HOME Compliance Report spreadsheet attached to the transmittal email. DO NOT SEND A SECTION 42 ERP OR PREVIOUS VERSIONS OF THE HOME COMPLIANCE REPORT!  Before uploading the report for your project, please name it by the Date Uploaded Project Name Program Year HOME Report (e.g. 03-02-15 BestApartments 2014 HOME Report). Please use the same Project Name as identified on the Secure Upload folder, and use the actual date uploaded, not the due date. Using this naming protocol will significantly reduce the time spent by AHC staff on re-naming items to conform to our naming protocol.  Utility Allowance Source Document showing the tenant-paid utility allowance amounts must be uploaded with the compliance report. The information being requested is nearly identical to that which you previously submitted for your 2013 annual compliance report for the HOME Program. Please note carefully any deficiencies that were found in the review of your 2013 annual compliance report so your 2014 report is correctly prepared. If you have not yet corrected compliance concerns identified in correspondence as of 12/31/14, your project is noncompliant and it will remain noncompliant until all corrections have been made and reported to us. Electronic submission of the compliance report is required unless your company is unable to use Microsoft Excel or another equivalent software program. If there is any reason you are not able to compile and submit this information as requested, please contact us to discuss the best course of action. Upload your completed electronic reports to your project’s secure folder. 2

RENT AND INCOME LIMITS HUD publishes new rent and income limits annually and we will advise you as soon as the 2015 limits are published. Previous years’ limits and those currently in effect can be found on AHC’s website. Any leases executed for new move-ins must be in compliance with the applicable rent limits. Any rent increases must be requested from and approved by the PJ before implementation. For existing tenants, please note that “any increase in rents for HOME-assisted units is also subject to the provisions of outstanding leases, and in any event, the owner must provide tenants of those units not less than 30 days prior written notice before implementing any increase (or decrease) in rents.”

PHYSICAL AND FILE INSPECTIONS AHC conducts a detailed file review and physical inspection against UPCS of at least 20% of the units in each project. If your project is due to have physical inspections and detailed file reviews in calendar year 2015 you will be notified under separate cover of the submission requirements. Your project will be inspected according to the total project units: annually for 26+, every two years for 5-25, and every three years for 1-4 units, or per your HOME agreement for projects with funds committed on or after August 23, 2013. Please keep in mind the typical tenant file requirements for the HOME Program, as follows: At move-in and every 6th Year of the Period of Affordability:  Income and Asset Questionnaire (Tenant Application)  HOME Eligibility Release Form OR Suballocator Data Practices Act (if PJ is also a Suballocator of Section 42 Low Income Housing Tax Credits).  Written third party verifications of all income and all assets (or Certification of zero income and/or zero assets). Note: For HOME units with tax credits, all assets must be third party verified, even if the household’s assets total less than $5,000.  Calculation of total anticipated annual income (including income from assets) Annually for all years besides every 6th Year of the Period of Affordability:  Household self-certification of annual income, or certification by a government agency e.g. PHA.

The summary of typical expectations stated above is meant for general guidance and is not a full description of the HOME Program requirements. Consult with your project documents, the HOME Final Rule, HUD Handbook 4350.3, Chapter 5, and the Technical Guide for Determining Income and Allowances for the HOME Program (Jan 2005). For those of you who have attended HUD sponsored training programs on the HOME Program, training materials you received should also be considered a primary resource.

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We are here to help you with a successful submission of your annual reports and to answer questions during the review process. AHC’s phone number is 651-222-8319 and our fax number is 651-222-3755. Our general e-mail is [email protected]. Please contact the following staff for the appropriate concerns: 

Mabruka Abdisamad for HOME Projects in Hennepin County: [email protected]



Stephanie Newburg for HOME Projects in Minneapolis: [email protected]



Peris Outa for HOME Projects in Dakota County, St. Paul, and St. Louis County: [email protected]

REMINDER: DO NOT EMAIL YOUR 2014 COMPLIANCE REPORT AND OTHER REQUESTED ITEMS. SUBMIT THESE VIA THE SECURE PROJECT FOLDER. UPLOAD INSTRUCTIONS ARE ENCLOSED.

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HOME PROGRAM PROJECT INFORMATION Program Year: January 1, 2014 through December 31, 2014 Participating Jurisdiction: NOTE: This information must match the HOME unit data in your HOME legal documents. TO BE COMPLETED BY OWNER (please complete and return with Owner Certification) PROJECT INFORMATION Project Name: Project Owner Name: Project Address: HOME Funds beginning date of Period of Affordability: HOME Funds end date of Period of Affordability: Submit your most recent Affirmative Fair Housing Marketing Plan for review. Describe steps that were taken during the year to market your HOME-assisted units (Use additional page if needed).

HOME-ASSISTED UNITS INFORMATION HOME Unit Status (Floating or Fixed): Total Project Units: List FIXED HOME units (Unit Numbers):

Number of HOME Units:

No. of units set aside for Low HOME rents: No. of units set aside for High HOME rents: No. of HOME units set aside for Extremely Low Income (30% AMI) households: No. of HOME units set aside for Very Low Income (50% AMI) households: No. of HOME units set aside for Low Income (80% AMI) households: OWNER CONTACT INFORMATION: Owner Contact Person: Owner Company: Address: City, State, Zip: Phone:

e-mail:

MANAGEMENT CONTACT INFORMATION Management Company: Manager Name: Address: City, State, Zip: Phone: e-mail:

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HOME INVESTMENT PARTNERSHIP PROGRAM Owner Certification HOME Project Compliance Project Name: Pursuant to the HOME Investment Partnerships Act, including any HUD regulations pursuant thereto and other applicable laws, rules, regulations and ordinances, I certify that the following requirements have applied to the project named above since the commencement of the period of affordability for HOME funds in accordance with the project’s agreements with the Participating Jurisdiction: 1.

Third party verification of all sources of income and assets was obtained from applicants and the owner has calculated annual anticipated income in accordance with HUD’s Part 5 Definition in order to determine eligibility under the appropriate HOME income limits BEFORE a household occupied a HOME unit.

2.

Annual verification or self-certification of income was obtained from each household occupying a HOME unit. Source documents or third party verifications were obtained every 6th year of the Period of Affordability as required by the HOME Final Rule or terms outlined in the project’s HOME contract documents. NOTE: This is not every 6th year of a household’s occupancy. It is every 6 th year of the POA and applies to all households living in HOME-assisted units, including households that moved in the previous year and whose income was subject to third party verification.

3.

Each HOME unit in the project was rent restricted so that gross rent (contract/lease rent plus rent assistance (if any), plus the utility allowance) did not exceed the maximum allowed under project documents and agreements with the Participating Jurisdiction.

4.

If a household’s income increased to a level in excess of the restrictions outlined in the project documents, that household’s rent was raised as appropriate according to HOME Regulations and the HOME unit designation (fixed or floating).

5.

Each unit in the project was suitable for occupancy in compliance with the property standards of 24 CFR 92.251 and also taking into account local health, safety and building codes. If not, attach a statement summarizing the entity that conducted the inspection, deficiencies found, whether they were corrected and the date(s) of correction. Do not attach copies of violation reports or notices except in unusual situations.

6.

The project was accessible to persons with disabilities in accordance with requirements for federally funded projects and the applicable design and construction standards.

7.

The project utilized an Affirmative Fair Housing Marketing Plan.

8.

The project utilized written tenant selection policies and procedures in accordance with 24 CFR 92.253(d).

9.

The owner complied with all federal, state and local laws relating to fair housing and equal opportunity.

10. Each household occupying a HOME unit signed a lease or had an additional lease addendum that conforms

to HOME Regulations (i.e. lease term was mutually agreed upon and there were no prohibited lease provisions). 11. No non-optional fees were charged to tenants in addition to rent. If charged, non-optional fees plus unit rent

do not exceed the applicable HOME limit. 12. For housing built before 1978, all tenants signed a "Lead Based Paint Disclosure" and were given a copy of a

federally approved pamphlet on lead poisoning prevention. OWNER REPRESENTATIVE SIGNATURE:

DATE:

PRINT OWNER REPRESENTATIVE NAME: WARNING: TITLE 18, SECTION 1001 OF THE U.S. CODE STATES THAT A PERSON IS GUILTY OF A FELONY FOR KNOWINGLY AND WILLINGLY MAKING FALSE OR FRAUDULENT STATEMENTS TO ANY DEPARTMENT OF THE UNITED STATES GOVERNMENT.

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