HomeMy WebLinkAboutAffordable Housing Policy Discussion
Commission Memorandum
REPORT TO: Honorable Mayor and City Commission
FROM: Community Affordable Housing Advisory Board
Tracy Menuez, HRDC IX
Wendy Thomas, Director of Community Development
SUBJECT: Affordable Housing Policy Discussion
MEETING DATE: January 13, 2014
AGENDA ITEM TYPE: Policy Meeting
RECOMMENDATION: Upon reviewing the material and considering the discussion on affordable
housing programs and incentives, provide policy guidance to the CAHAB and staff regarding affordable
housing priorities for the City of Bozeman.
COMMISSION DIRECTION NEEDED REGARDING:
1. Provide guidance to the CAHAB and City staff on the issues of affordable housing incentives,
priorities, and regulatory reforms, please see Attachment 3;
2. Provide direction to staff on allocation of funding resources, including staff, to meet affordable
housing priorities;
3. If the Commission is supportive of a formal funding process, provide feedback on the proposed
application, funding priorities, and process, please see Attachment 4;
4. Other issues or considerations identified by the Commission.
EXECUTIVE SUMMARY:
In 2011, the City Commission allocated funds for a Affordable Housing Needs Assessment and
Affordable Housing Plan for 2012-2016. The Affordable Housing Plan (Attachment 5) was adopted
May 14, 2012, and serves as policy guidance for City staff and partners. This plan identified four
strategies for affordable housing production and policy, which are included in summary text form in
Attachment 1. Attachment 3 contains a summary table of the Plan’s strategies where issues CAHAB
and staff are seeking direction from the City Commission are highlighted.
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Status update:
In reviewing the housing plan production to goals, there are a number of areas where the City and
housing partners are performing quite well and are on target to meet and/or exceed the targets set.
Homeownership production, housing counseling, and the completion of the Warming Center and Amos
House helped the City progress toward meeting housing needs. The adoption of a new impact fee
schedule also creates a more positive financial impact on the smaller, denser development often
resulting in more affordable housing. Finally, HAVEN continues to progress quite well with their shelter
plans, and is expected to meet their targets either within the plan period or shortly thereafter.
As much as the City has achieved, there are areas where production has fallen short. Generally, the areas
where performance has lagged are those where the City and its partners are dependent on outside
funding sources (HOME, Community Development Block Grant, LIHTC). Across most programs,
funding is down, restrictions are tightened, and competition is fierce. Funding was reduced for down-
payment assistance, and the state has yet to reauthorize contracts for owner-occupied rehabilitation.
Section 8 housing choice rental vouchers have been frozen, meaning that no new vouchers are issued,
and vouchers are not reissued once households move out of the program. Most disappointing, despite
strong City support, including financial incentives, the development of affordable rental housing using
the Low Income Housing Tax Credit has lagged well behind targets. In 2013, the City supported a 48
unit development that, due to the ultra-competitive funding environment, was not funded with LIHTC. It
is anticipated that this project will apply in a future round, but, even if funded, subsidized rental housing
development in Bozeman lags behind targets.
Opportunities, ongoing tasks, and things left to do:
Maintaining and expanding programs and housing stock remain a priority for the City and our partners
in the nonprofit and private sectors. The City and partners will continue to leverage funds with outside
sources when possible. It is expected that production in all areas will be maintained/expanded subject to
funding availability. Aside from funding, there are strategies identified in the housing plan that remain
to be addressed and represent additional impacts to the production of affordable housing. These
strategies include: reviewing minimum lot sizes, open space requirements, maintaining mobile home
parks in the housing stock, amending the workforce housing ordinance, and exploring methods to reuse
or create value added use in existing structures. The CAHAB has also identified a need for increased
public education and communication to elevate understanding of the affordable housing needs in our
community, particularly among the private development sector.
POLICY DISCUSSION/CAHAB RECOMMENDATIONS:
In the CAHAB’s view, implementation of the plan has been progressing as expected, particularly given
the funding environment. We encourage the City and nonprofits to continue utilizing outside funding
sources to the extent possible to promote the goals of the plan and to use our own funds strategically to
support private and nonprofit developers of affordable housing.
We ask that the City Commission consider allocating additional staff resources to address the regulatory
reforms suggested in the plan, including an overhaul of the Workforce Housing Ordinance, a review of
minimum lot sizes, and open space requirements. The CAHAB also seeks to implement a process and
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priorities for applying for City affordable housing funds, and to solidify the CAHAB’s role in the review
process.
ALTERNATIVES: As directed by the Commission.
FISCAL EFFECTS: The fiscal effects of funding increased capacity and/or affordable housing
incentives are undetermined at this time.
Report compiled on: December 20, 2013
Attachments:
1-Affordable Housing Plan Status Summary
2-Affordable Housing Plan Goals 2012-2016
3-Affordable Housing Plan Goals/Issues Summary Table
4-Proposed Application for City Support of Affordable Housing Activities
5-City of Bozeman Affordable Housing Action Plan: 2012-2016
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ATTACHMENT 1
AFFORDABLE HOUSING PLAN STATUS SUMMARY TABLE AND
EXPLANATORY TEXT
Strategy 1: Increase and preserve the supply of affordable housing
• Rental Housing production. The plan outlined a goal to add 200 Low Income Housing Tax
Credit (LIHTC) Units and 40 senior low-income units. Despite strong support from the City,
including impact fee support, only 11 units have successfully received LIHTC funding. To date:
11 units from LIHTC. Outlook: The LIHTC funding environment remains competitive, however;
it is anticipated that projects in the 45-50 unit will continue to apply in each round
• Homeownership production. At the time of the plan’s adoption, the for-sale market was just
beginning to improve, and the plan recommended a conservative 25 units, if the market was
sufficiently improved to support them. To date: In 2013, the HRDC completed the sale of all
available units in Phases 1 and 2 of the West Edge condominiums, totaling 56 units. Outlook: 24
units are currently under construction at West Edge Phase 3, to be completed in summer 2014.
The plan also recommended reviewing city regulations and the impact fee structure to encourage
construction of more affordable homes. To date: In 2013, the City adopted the updated impact
fee structure, which has been more favorable to affordable housing by providing for smaller fees
on smaller lots with more dense development. Outlook: CAHAB has discussed the potential of
reviewing lot size and open space requirements as they impact affordable housing.
• Down-payment assistance and housing counseling. The plan outlined how the HRDC’s
homeownership center, The Road to Home, uses counseling, education and down-payment
assistance programs to create a stream of homebuyers. The program works in a tri-county area,
with approximately 65% of customers residing in Bozeman. The plan set a goal of counseling
750 prospective buyers, assisting 100 with down-payment assistance. To date: Since the plan’s
implementation, the HRDC has counseled 498 potential homebuyers, and 8 have purchased
using down-payment assistance. The primary funding source for this program, the HOME
program, has undergone changes in recent years that have made the use of this funding more
restrictive, however; HRDC staff continues to work with local partners, including the City, to
expand this program. Outlook: HRDC continues to have strong homeownership education
participation, and is expanding homebuyer counseling. The HRDC received a new contract from
the HOME program in November 2013, for $250,000 to be used by November 2015 for down-
payment assistance.
• Repair existing affordable homes. The plan identified the goal of conducting homeowner
occupied rehabilitation for 25 homes, emergency repairs for 25 homes, and weatherization for
400 renter and owner-occupied homes. To date: Since the plan’s implementation, the HRDC has
weatherized 217 homes in the tri-county area. Funding for owner-occupied rehabilitation has not
been renewed, and no homes have received service. Outlook: Funding for owner-occupied
rehabilitation remains doubtful, despite matching efforts made by the City. Weatherization
numbers are on track to meet goal.
• Special needs housing and transitional units. The plan identified the goals of creating 10
“transition in place” units, completing the expansion of Amos House, continuing the operation of
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the Warming Center, constructing 9 family-appropriate transitional units, replacing 16 units of
Behavioral Health Supportive housing, creating 3 additional units of Behavioral Health
Supportive housing, and rehabilitating/replacing 13 units of emergency domestic violence shelter
while increasing total beds by at least 3. To date: HRDC has added 4 transition in place units,
and Family Promise has added 2. The Amos house expansion was completed in 2013, creating
15 beds with supportive services for both males and females. The Warming Center relocated, and
in doing so was able to expand to 40 beds (from 24) with male and female dormitories and
provide a separate space for families. Outlook: HAVEN has been working with the City, HRDC,
Gallatin Valley Land Trust and other partners to secure land to build a new domestic violence
shelter and is in the feasibility study stage of their capital campaign. It is estimated that their new
shelter will be operational in 2016-2017.
• Encourage energy-efficient residential construction and retrofits. As part of the plan’s
adoption, Green Building and Renovation guidelines were adopted, which apply to all units
receiving city support. The costs, benefits, and implementation considerations of these guidelines
are to be reconsidered by year end 2014 for possible amendments. To date: Projects requesting
City support have readily accepted the guidelines. Outlook: The guidelines will be reviewed in
2014 for possible amendments, as scheduled.
Strategy 2: Consider amendments to City regulations
• Consideration of amendments to Workforce Housing Ordinance. At the time of the plan’s
adoption, the recommendation of the consultant was to continue the suspension of the workforce
housing ordinance. Criteria for evaluating the reinstatement of the ordinance were also provided.
To date: City staff has been providing the commission with quarterly data regarding the status of
the reinstatement criteria points, namely housing costs and building permit data. The ordinance is
currently suspended through December 2014. The consultant recommended that if the
commission desired to reinstate the ordinance, the ordinance should be amended to increase
clarity and reduce administrative burdens. Outlook: The CAHAB requests that the Commission
allocate resources to amending the ordinance for reinstatement.
• Deferring and/or subsidizing impact fees for affordable housing. The plan suggested a
process for prioritizing incentives to be provided for affordable housing developers. Attachment
3 contains the CAHAB’s recommendations for a funding process. To date: A new impact fee
schedule was adopted in 2013, which provides significant relief to developers of affordable
housing. Outlook: The CAHAB has impact fee deferment and, in some cases, subsidy, for units
creating increased levels of affordability, as outlined in Attachment 2, and subject to budget
authority. The CAHAB would like to further discuss the best use of the workforce housing fund,
and receive direction that if, in consideration of the update impact fee schedule, funds would be
better allocated other manners.
• Allowing creation of smaller lots with more flexible dimensional standards. When the
consultant visited with developers, there was mixed interest in building on smaller lots than
allowed by City ordinance. However, there was sufficient input that the ability to build on
smaller lots would yield more affordable market-rate homes. To date: Norton East Ranch
included 9 homes on smaller lots, as they were platted under the WFH ordinance, however; as
the ordinance was later suspended, none of the homes were subject to the requirements of the
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ordinance. Norton has reported that they were pleased with the market demand for the product,
and has requested that the City allow them to build 18 more homes on these smaller lots in their
next phase. Outlook: The CAHAB is scheduled to review Norton’s request at their January 8,
2014 meeting, which will occur before this file is required at the Clerk’s office. The CAHAB
would like to address this issue with the Commission during the policy meeting.
• Consider more flexible requirements for re-platting subdivisions. While an issue at the time
of the plan’s implementation, this issue was particular only to those subdivisions with Reduced
Size Lot and WFH requirements, and has been resolved. It is not expected to be a further
concern. Outlook: City Staff has been approached by a couple of Developers who have
expressed an interest in creating single family homes on smaller lots than are currently allowed
by right in the City Code. Staff has encouraged these developers to utilize the Work Force
Housing Program in order to develop this housing type.
• Review current ordinances regulating Accessory Dwelling Units (ADUs). Many participants
in focus groups indicated support for increased flexibility in promoting ADUs. To date: The
CAHAB has discussed ADUs, and supports the City’s current policy in promoting ADUs in
those areas of the City where they are consistent with the neighborhood. Outlook: ADUs are a
part of the residential infill policy. Staff is moving forward with awarding a contract to a
consultant to assess the strengths and potential improvements that can be made to the program.
• Clarifying status of group homes. The City Commission amended the Uniform Development
Code to include Community Residential Facilities and establishing the facilities as a use by right
in all residential districts except R-3, where a Conditional Use Permit is required. The changes
were adopted in Ordinance 1838 in August, 2012.
• Studying ordinance changes to encourage preservation of mobile home parks. The City and
affordable housing providers are aware that mobile home parks provide a substantial supply of
affordable homes in our community, and that their preservation will require cooperation between
the City, park owners, and multiple funding sources. To date: This strategy is yet to be
implemented. Outlook: By 2016, the City will conduct the review of ordinance requirements and
work with partners to address the vulnerability of the City’s mobile home park housing stock,
considering housing condition, location, affordability level, and infrastructure needs.
Strategy 3: Assure Financial and organizational capacity
• Maximize Bozeman’s access to federal funding and private grants for affordable housing.
Most large scale funding sources used for affordable housing production (HOME, Community
Development Block Grant (CDBG), LIHTC, and other HUD funds) are administered via the
State of Montana. The needs study found that these sources had been underutilized in recent
years. The plan identified goals of collaboration between non-profit service providers and
support from the City to increase these funds in our community. To date: Non-profits collaborate
through a number of formal and informal outlets to discuss funding opportunities and develop
strategies to jointly administer programs, such as HUD Emergency Service Housing. The City
adopted LIHTC support guidelines, and allocated approximately $25,000 to Summit Housing to
support their LIHTC application to the Montana Board of Housing, which was unsuccessful.
HAVEN had considered utilizing CDBG for their shelter needs, however; domestic violence
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shelters are now funded through the ultra-competitive Public Facilities division, and the
organization ultimately chose not to submit the application. Outlook: The funding environment
continues to be competitive. Nonprofits and the City will continue to explore opportunities to
leverage funds and maximize access to federal and private funds.
• Maximize effectiveness of Workforce Housing fund. The plan called for use of the City’s
funds to provide gap financing for projects that meet the housing plan, and suggested a funding
process for applications. To date: The fund has been used as recommended, supporting
Homebuyer’s Education and Counseling, and was allocated, but not used, for the Summit
Housing LIHTC project. Attachment 2 contains the CAHAB’s recommendation of a funding
process and criteria for discussion with the commission. Outlook: The CAHAB is aware of
projects in early stages that may request workforce housing funds to leverage resources. The
CAHAB would like the commission to weigh in on the process outlined in Attachment 2, which
is similar to that adopted for LIHTC applications.
• Build the capacity of local nonprofit housing organizations. The organizations participating in
the needs survey outlined capacity building goals, generally related to program development,
grant writing and subsidy layering. To date: Staff has supported HAVEN with their shelter
project, providing technical assistance regarding the CDBG program and assisted in the
feasibility study process. Staff also worked with Habitat to assess the potential of submitting a
CDBG planning grant for a proposed project, which the organization ultimately chose not to
pursue. Outlook: Staff will continue to reach out to local nonprofit housing organizations to
determine if technical assistance is needed and how the City can support those needs.
Strategy 4: Share crucial market data and report on progress
• Update target rent and ownership amounts. The plan provided a tool to update affordability
calculations as they relate to changes in Area Median Income (AMI). To date: The update is
done annually. Outlook: No changes are expected.
• Rental market survey. The plan set a goal of conducting a rental market survey on an annual
basis. To date: Funds were allocated by the commission, and the scope and work and notice is
prepared to be released by January 31, 2014. Outlook: The City will need to consider if this
project can be funded on an annual basis, and review alternatives to conducting an annual survey
if they choose not to allocate funding. Potential alternatives could include reviewing survey data
from LIHTC applicants (when available), or conducting a scaled-down survey to reduce costs.
• Annual report on action plan progress. Each year City staff will prepare a report to the
Commission on the housing plan’s progress versus goals set. Appendix A of the Housing Plan
provides the 5-year goals in table form. To date: Annual reports have been made as outlined. The
report for the year 2014 is included in this memo. Outlook: No changes anticipated.
• Complete a new needs study and housing plan in 2016. Nearly 10 years had passed between
this Housing Plan and the most recent, adopted in 2003. To ensure that the plan is updated in a
timely manner, the update is included as a plan goal. To date: Not applicable. Outlook: CAHAB
will request that the Commission allocate funding for an updated needs assessment and housing
plan to be adopted by 2017.
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ATTACHMENT 2
Affordable Housing Plan Goals 2012-2016
Adopted from Appendix A of Housing Plan
Affordable Housing Activities Sponsor
Outcomes
through
2011
2012-2016 Goals
for additional
units
2012-2016 To
date actual
production
HOMEOWNERSHIP PROGRAMS
Build and sell new homes HRDC 20 24 24 under
construction
Build and sell new homes Habitat 59 1 0
Acquisition and sales of homes HRDC 15 0 0
Homeowner rehab assistance* HRDC 37 50 0
Down-payment assistance* HRDC 104 100 8
Weatherization of homes and rentals* HRDC 431 350 217
Weatherization/repairs for
homeowners (with volunteers) Rotary Not avail. 50 Not available
Emergency repairs HRDC Not avail. 25 Not available
Pre-purchase counseling* HRDC 1779 750 498
Foreclosure counseling* HRDC 200 200 18
SUBSIDIZED RENTAL HOUSING
LIHTC rentals built – seniors HRDC 161 40 0
LIHTC rentals built – families Multiple 344 200 11
Other rental housing built HRDC 24 0 0
SPECIAL NEEDS HOUSING
Transitional housing provided HAVEN/Family
Promise 0 9 0
Transitional housing provided HRDC 2 16 15-Amos House
Permanent rental – behavioral health Western MT
Mental Health 4 0 0
Transitional housing – development
disabilities REACH 16 16 Replace
3 new 0
Supportive Housing – developmental
disabilities REACH 25 Replace or repair 0
Emergency Shelter/warming center
beds HRDC 24 0 40
Emergency Shelter beds – families Family Promise 12 0 Warming center
includes families
Domestic Violence shelter beds HAVEN 13 13 Replace
3 new 0
OTHER PROGRAMS
Section 8 rent subsidies* HRDC 273 0 0
Transitional rent subsidies HRDC/HAVEN/
Family Promise 0 10 6
Note: Unless indicated otherwise, service area for programs is Bozeman; programs with * serve tri-
county area (Gallatin, Park, Meagher). The Rotary repair program serves Bozeman and Belgrade. A
zero under 2012-2016 goals indicates that no additions are considered feasible at this time.
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ATTACHMENT 3
AFFORDABLE HOUSING PLAN GOALS/ISSUES SUMMARY TABLE
Highlighted text denotes issues where CAHAB is seeking City Commission input/direction
Strategy 1: Increase and preserve the supply of affordable housing
PROGRAM GOAL ACHIEVEMENT PERCENTAGE
COMPLETE
FORECAST ISSUES IDENTIFIED
Rental Housing
Production
200 Low Income Housing Tax Credit
(LIHTC) Units & 40 Senior Low-Income
Units
11 units 5% Anticipated that
projects in the 45-50
unit will continue to
apply in each round
High competition for LIHTC makes them
very difficult to obtain. Should the City
devote resources to seek partnerships
and funding sources to enhance the
strength of applications from Bozeman?
Homeownership
Production
1. 25 Units
2. Review City Regulations & Impact
Fee Structure to Encourage
Construction of more Affordable
Homes
1. HRDC 56 units
2. Updated Impact Fee
Structure – Provides smaller
fees on smaller lots
224% 24 units under
construction at West
Edge, completed in
2014
CAHAB recommends the City review lot
size, consider a lot size of 4,000 SF and
eliminate the open space requirements
for affordable housing lots.
Down-payment
Assistance and Housing
Counseling
Road to Home Program- Counsel 750
Prospective Buyers, Assist 100 with
Down-Payment Assistance (DPA)
Counseled 498
DPA 8
66%
8% DPA
Strong homeownership
education participation
and HRDC expansion of
homebuyer counseling
Repair Existing Affordable
Homes
Owner Occupied Rehabilitation - 25
Emergency repairs -25
Weatherization - 400 units
217 in the tri-county area 48% Funding for owner-
occupied rehabilitation
remains doubtful,
despite matching
efforts made by City.
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Special Needs Housing &
Transitional Units
1. Create 10 “transition in place” units
2. Complete expansion of Amos House
3. Continue operation of Warming
Center
4. Construct 9 family-appropriate
transitional units of Behavioral Health
Supportive housing
5. Rehabilitate/Replace 13 units of
emergency domestic violence shelter
while increase total beds by at least 3
1. 6 units created
2. Amos House expansion
created 15 beds with
supportive services
3. Warming Center relocated,
expansion of male and female
dormitory, separate space for
families
60%
100%
100%
0%
The goal is to have a
new shelter
operational in 2016-
2017
Funding is a key issue, HAVEN is working
with City, HRDC, Gallatin Valley Land
Trust and other partners to secure land
to build a new domestic violence shelter
and is in feasibility study stage of capital
campaign.
Encourage Energy-
Efficient Residential
Construction and
Retrofits
Green Building and Renovation
Guidelines were adopted. Costs,
benefits, and implementation
considerations of these guidelines are
to be reconsidered by year end 2014
for possible amendments.
Projects accepting City
support have accepted
guidelines.
NA Guidelines will be
reviewed in 2014 for
possible amendments.
None
Strategy 2: Consider amendments to City regulations
PROGRAM GOAL ACHIEVEMENT PERCENTAGE
COMPLETE
FORECAST ISSUES IDENTIFIED
Consideration of
Amendments to
Workforce Housing
Ordinance
Continue suspension of workforce
housing ordinance
City staff providing quarterly
update regarding for sale
housing costs.
NA Ordinance
suspended
through
December
2014
CAHAB requests the Commission allocate
funding from the Affordable Housing Fund to
engage a professional firm to propose
amendments to the ordinance so that a program
is available for implementation upon Commission
action to reinstatement a WorkForce Housing
Program.
Deferring and/or
Subsidizing Impact Fees
for Affordable Housing
Process for prioritizing incentives
provided for affordable housing
developers
New impact fee schedule was
adopted in 2013 providing
relief to developers of
affordable housing
NA
Allowing Creation of
Smaller Lots with More
Flexible Dimensional
Standards
Increasing interest from developers in
building on smaller lots than allowed by
City Code
9 - Norton East Ranch NA Norton Ranch
-18 units
Valley West -
24 units
CAHAB will review Norton’s request at Jan. 8th
meeting and would like to address issue of
smaller lots with Commission during policy
meeting.
Consider More Flexible Create an expedited process for NA Would the City Commission consider creating an
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Requirements for Re-
platting Subdivisions
development of Affordable Housing expedited process for re-platting developments
where less than 100 percent of the units qualify
as affordable housing?
Review Current
Ordinances Regulating
Accessory Dwelling Units
(ADUs)
Many participants in focus groups
indicated support for increased
flexibility in promoting ADUs
CAHAB has discussed ADUs
and supports City’s current
policy
NA ADU regulations will be examined as part of
infill/redevelopment code considerations
currently underway.
Clarifying Zoning Status
of Group Homes
Review ordinance for group homes and
possibly propose appropriate
amendments to clarify where and
conditions of approval.
UDC amended in August, 2012 NA
Studying Ordinance
Changes to Encourage
Preservation of Mobile
Home Parks
Mobile home parks provide substantial
supply of affordable homes and
preservation will require cooperation
between City, park owners, and
multiple funding sources
Strategy is yet to be
implemented.
Land Value in
Bozeman may
soon result in
the sale of
MHP for redev
By 2016, City will review ordinance requirements
and work with partners to address the
vulnerability of City’s mobile home park housing
stock, consider housing condition, location,
affordability level, and infrastructure needs.
Strategy 3: Assure financial and organizational capacity
PROGRAM GOAL ACHIEVEMENT PERCENTAGE
COMPLETE
FORECAST ISSUES IDENTIFIED
Maximize Bozeman’s
Access to Federal Funding
and Private Grants for
Affordable Housing
Collaboration between non-profit
service providers and support from City
to increase funds in our community
NA Non-profits and City will continue to explore
opportunities to leverage funds and maximize
access to federal and private funds
Maximize Effectiveness of
Workforce Housing Fund
Use of City’s funds to provide gap
financing for projects that meet the
housing plan, and suggested a funding
process for applications
Fund used to support
Homebuyer Education/
Counseling and was allocated,
but not used, for Summit
LIHTC project
NA CAHAB is aware of projects in early stages that
may request workforce housing funds and would
like the Commission to weigh in on process.
Build the Capacity of
Local Non-Profit Housing
Organizations
Program development, grant writing
and subsidy layering
Supported HAVEN, providing
technical assistance and also
worked with Habitat to assess
potential of submitting a
CDBG planning grant
NA Continue to reach out to local non-profit housing
organizations to determine if technical assistance
is needed and how the City can support those
needs.
Strategy 4: Share crucial market data and report on progress
PROGRAM GOAL ACHIEVEMENT PERCENTAGE
COMPLETE
FORECAST ISSUES IDENTIFIED
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Update Target Rent and
Ownership Amounts
Update affordability calculations as
they relate to changes in Area Median
Income (AMI)
Update is done annually No charges are expected.
Rental Market Survey Conduct a rental market survey on an
annual basis
Funds were allocated by the
commission, and the scope,
work and notice is prepared to
be released by January 31,
2014
Should this study be funded on an annual basis?
Alternatives to conducting an annual survey may
be a better use of AH funds. Potential
alternatives could include reviewing survey data
from LIHTC applicants (when available),
conducting a scaled-down survey to reduce costs,
or conducting a survey on a bi-annual basis.
Annual Report on Action
Plan Progress
City staff will prepare a report annually
showing the housing plan’s progress
versus goals set
Annual reports have been
made as outlined. The 2014
report is included in this
memo.
No changes are expected.
Complete a New Needs
Study and Housing Plan in
2016
Update plan Not applicable CAHAB will request that the Commission allocate
funding for an updated needs assessment and
housing plan to be adopted by 2017.
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ATTACHMENT 4
City of Bozeman
Application for City Support of Affordable Housing Activities
Applicability:
These criteria apply to proposals for use of City funds for affordable housing activities and requests for formal
City endorsement of projects for the purposes of obtaining federal, state and private grants and tax incentives.
All project and program proposals will be reviewed by City staff or their delegates and recommendations made
by the Community Affordable Housing Advisory Committee. Final decisions will be made by the City
Commission. The City may support applications through a letter of support to a funder, grant sponsorship (for
HOME and CDBG sources), and/or direct funding support.
Evaluation Criteria:
To provide funding or a letter of support for a project, the City must receive and evaluate the following data.
1. Market data. This will consist of credible and detailed market data, waiting list data or other
information indicating demand for the proposed housing or services.
2. Project financial data. This will consist of a detail project development budget showing all proposed
sources and uses of capital financing. If the project will provide rental or supportive housing, an operating
budget forecasting revenues and expenses over at least 10 years must be provided. For projects in which
supportive services are crucial, the operating budget must include forecasts of proposed revenue and
forecast expenses for these services.
3. Capacity of project or program team. The project’s proposer must identify all key firms and individuals
involved in the project or program and provide resumes and corporate qualifications indicating their
capacity to carry out the program. Exceptions to this requirement may be made by City staff for proposers
who have successfully operated similar programs or developed similar projects previously in Bozeman. For
a new program, resumes must be provided for the organization’s chief executive and the program
manager. For development projects, resumes or corporate qualifications statements must be provided for
the developer, the individual proposed as project manager, architect, and building contractor.
Eligible Activities and Funding Criteria:
Funding from the Workforce Housing Fund or other City sources may be provided, at the City’s sole discretion
and with the recommendation of the CAHAB for those activities outlined in Appendix B. Periodically, the City
and CAHAB may solicit concept proposals from housing programs and housing developers. They may also accept
unsolicited proposals from nonprofit and for-profit organizations.
Deadline for requests:
Applications are accepted on an annual, rolling basis. Applicants are advised to communicate with City staff as
early as possible in the development of their project. Developers of LIHTC properties must submit their request
for support from the City along with the required information 45 days before applications are due to the
Montana Board of Housing.
Criteria for Support:
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Full criteria for City support of Affordable Housing Activities can be found in Appendix B of the City of Bozeman
Affordable Housing Action Plan for 2012-2016: http://www.bozeman.net/Smarty/files/51/513668ad-f9e9-4ff7-
a5ab-21953d79856f.pdf
Financial Support:
Financial support is based upon funding availability and meeting eligibility criteria in Appendix B. Projects
anticipating a need for financial support should contact the City as early as possible to ascertain the availability
of funding.
Ranking Process:
Requests will be evaluated to determine if they meet the threshold requirements outlined in Appendix B; those
meeting threshold requirements will be scored by city staff according to the following criteria:
• Review of market study – 20 points
To what extent do the market study and other available data demonstrate a need for the proposed
project?
• Review of financial data – 20 points
Sources, uses and budget forecasts will be evaluated for reasonableness and long-term project
sustainability.
• Capacity of development team – 20 points
Do the team and key staff have experience with this type of project? How has the applicant performed
in the past? Has the developer made previous requests to the City or State Department of Commerce to
restructure commitments made on similar projects?
• Project Affordability – 20 points
Proposed rents/sales prices will be evaluated for the populations to be served to determine the extent
to which the proposed project meets the City’s most critical affordable housing needs.
• Inclusion of units for lower income households (earning less than 30% AMI for rental housing, earning
less than 60% for ownership housing) – up to 20 points
The City has an interest in promoting the development of units for households earning less than 30% of
the area median income in rental developments and less than 60% AMI in ownership developments, as
these levels represent the households that are most difficult to serve. The City will reward 5 points per
unit (for up to 4 units) directed to households earning less than the outlined AMI levels for rental and
ownership projects.
City of Bozeman
Affordable Housing Support Application
Project Name:
Developer(s):
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Non-profit partner (if applicable):
Project Address:
Number of Buildings: Number of Units:
Affordability Period:
Type of request (grant, loan, grant sponsorship, or support letter):
Please provide responses to the following questions as an attachment to this form.
1) Provide a brief description of the proposed project. Include information regarding project location,
number of units, type of units, development/unit amenities and any other information you would like
the city to consider.
2) Describe how the proposed project meets or exceeds the Green Building standards outlined in Appendix
C of the City of Bozeman Affordable Housing Action Plan.
3) Explain how the proposed project is in support of the City of Bozeman’s Affordable Housing plan and
serves a target income group identified by the plan.
4) How will your firm ensure that the long-term management of the project will 1) provide adequate
funding for project sustainability, and 2) be responsive to the needs of low-income residents? If your
project is an ownership project, explain how your firm will support homeowners to promote long-term
success.
Attachments (for all support requests):
• Narrative responses
• Site plan
• For each unit type: proposed rent, # of bedrooms, # of bathrooms, rent level (AMI targets)
• Market Study
• Project financial data – sources and uses; 10 year operating budget (rental projects); if supportive
services are identified as crucial to the project, the operating budget must include forecasted revenue
and expenditures for these services
• List of development team, including relevant experience in developing/owning similar projects. Please
attach resumes for key staff and firm principals.
If the project is requesting financial assistance, please answer the following:
Amount of financial assistance requested:
Number of units for which assistance is requested:
Please provide responses to the following narrative questions as an attachment to your request.
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1) Explain how this request meets a critical housing need for the City of Bozeman.
2) Please list the other subsidies the project has applied for, the amount requested from those sources, if
the funds have been awarded, or the anticipated award date.
3) Explain how your firm will ensure that funding provided by the City will be used to promote long-term
affordability. For instance, will your project have an affordability period, resale, or recapture provisions?
Is your firm proposing a loan or grant of assistance?
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City of Bozeman
Low Income Housing Tax Credit
Request for Support Application Supplement
Project Name:
Developer(s):
Non-profit partner (if applicable):
Project Address:
Number of Buildings: Number of Units:
Amount of Credits being requested: Affordability Period:
Proposed Unit Mix:
# baths # at 30%
AMI or less
# at 40%
AMI or less
# at 50%
AMI or less
# at 60%
AMI or less
Studio
1BR
2BR
3BR
TOTAL at rent level 0 0 0 0
TOTAL # of Units 0
Proposed Rents:
30% AMI
or less
40% AMI
or less
50% AMI
or less
60% AMI
or less
Studio
1BR
2BR
3BR
Low Income Housing Tax Credit Process Supplemental Information
LIHTC Applications and the staff report will be forwarded to the Community Affordable Housing Advisory Board
(CAHAB). The CAHAB will forward the staff report and a CAHAB recommendation to the City Commission, which
shall have the final authority to determine which project(s) will receive letters of support. The City Commission
may elect to support more than one proposed project, and/or rank the projects they are supporting.
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