Pennsylvania Housing Finance Agency Pre-Application Meeting for Multifamily Programs May 10, 2017 Questions and Answers *REMINDER* ALL APPLICANTS ARE REQUIRED TO SUBMIT AN INTENT TO SUBMIT A TAX CREDIT APPLICATION FACT SHEET, DEVELOPMENT SYNOPSIS & OPERATING BUDGET ON OR BEFORE JULY 7, 2017. FULL APPLICATIONS ARE DUE SEPTEMBER 8, 2017. Threshold and General Questions: 1. Q: How much is the allowable developer s fee for a project with 24 units or less? A: For developments of 24 units or less, the developer s fee is limited to 20% of the replacement cost of the development less all costs of acquisition. For developments of 24 units or less and part of a multiple phased project, the developer s fee on subsequent phases will be limited to 12% of the replacement cost of the development less all costs of acquisition. 2. Q: If local government HOME funds require a 15% developer s fee re-investment, will this 15% requirement count towards the Agency limitation of the 50% re-invested developer s fee cap? A: Yes. The Agency will include required re-invested developer s fee in the calculation of the total reinvested developer s fee. Applications which show re-invested developer s fee in excess of 50% are deemed financially infeasible and will be returned. 3. Q: The Agency previously received comments regarding the effectiveness of the Walk Score in the ranking process as it may not accurately reflect/represent access to services in the area? A: This was discussed at a focus group (approximately 40 developers/consultants) held in January 2015 and the Agency agreed to accept feedback from the focus group in advance of the adoption of the Allocation Plan. The Agency did not receive any feedback or documentation from the group and did not change the Walk Score Selection Criteria in the current Allocation Plan. 4. Q: Is it possible to be contacted, in advance, when the Agency visits a proposed site as part of its due diligence process so that the Applicant can be present and available to discuss the project at that time? A: Due to the scheduling challenges of visiting a number of sites, the Agency does not include the Applicant as part of this visit. However, upon the Agency s receipt of an Intent to Submit, a PHFA Development Officer will be assigned to a project and will contact the Applicant. At that time, the Applicant should request a site visit or contact the Agency to discuss the proposal. 5. Q: Will we know who the assigned PHFA Development Officer is? A: Again, the Agency intends to assign a PHFA Development Officer upon receipt of the Intent to Submit. Upon receipt of the full Application in September, the Agency may re-assign Applications based upon the final number of Applications received. The Agency intends to assign resubmitted proposals to the PHFA Development Officer who previously reviewed the project.
6. Q: Will the HERS targets remain the same for 2017/2018? A: Yes, the Agency has not changed the energy efficiency goals to be evidenced by reduced HERS ratings. 7. Q: What does the Agency require to be submitted to receive points in the Green Building Program category under Development Characteristics? A: The Agency has as one of its Threshold Criteria a requirement that all new construction and rehabilitation developments meet the mandatory measures outlined in the 2015 Enterprise Green Communities Criteria or, for preservation developments, those set forth in the Agency s Design Architect s/applicant s Certification of Threshold Criteria. Points may be awarded to those developments that exceed these measures through the receipt of certification from Enterprise Green Communities, LEED or National Green Building Standards. Please see the Allocation Plan and Multifamily Guidelines for specific criteria. 8. Q: Can you receive points for both Passive House and Enterprise Green Communities ranking categories? A: These are two different categories in the Selection Criteria and points may be awarded for achievement of both of them. Passive House is not a certification process but rather you will have to meet specific Passive House standards. Again, for 2017/2018, receipt of a certification that the Enterprise Green Communities Program will be required for points. 9. Q: With projects involving both adaptive reuse and new construction, how will the points be awarded? A: The adaptive reuse portion of the total development square footage must represent at least 50% of the total residential area of the development. Partial points in this category will not be considered. 10. Q: Are the Areas of Opportunity scores/tables, etc. used to calculate the Community and Economic Impact ranking scores, available? A: The Agency will be posting the scores on the Application page of the website in the coming weeks. 11. Q: Can a Letter of Credit be submitted for the funding of insurance and tax reserves for Agency loan funded projects? 811 Questions 12. Q: Do you need a new Rental Assistance Contract (RAC) for each tax credit project in order to receive points for Section 811 participation? A: Consideration will be given if an Applicant enters into an Agreement to Enter into a RAC, executes a new RAC or amends and existing RAC for eligible Section 811 properties on or before December 28, 2017. 13. Q: Do the Section 811 units need to be on a tax credit project? The Agency will consider Section 8, Rural Development and other federal housing programs of currently unassisted units that are not set aside for persons with disabilities.
14. Q: If submitting more than one application, will you receive the points for Section 811 participation on all applications if you pledge units on an existing project? A: Yes, you will receive points on all Applications. 15. Q: Are the point percentages calculated on a single project or portfolio-wide? A: Points will be awarded based upon the participation at a single project. 16. Q: Do the Section 811 units need to be ADA accessible? Section 811 units can float within the project depending on the residents needs. 17. Q: If the existing project currently has no vacant units, can you commit to a RAC for units that would become available upon vacancy for consideration for points? A: Yes, upon the execution of the RAC, the next available unit would need to be considered for Section 811 eligibility. 18. Q: If a project is already participating in the Section 811 program, will the units that are currently included in the program qualify for ranking consideration? A: No, we are looking for new Section 811 units to be set aside to be eligible for points. 19. Q: Why aren t senior developments eligible to participate in the Section 811 program? A: The Section 811 program guidelines specify occupancy for persons ages 18-61. 20. Q: Can you receive the Section 811 rental assistance on 20% units? A: Yes, you can receive the rental assistance for the 20% units. 21. Q: What is the length of the RAC for the Section 811 units? A: The term of the RAC is twenty (20) years. Initial funding is set aside for a five (5) year term. Additional funding is based upon annual appropriations. MBE/WBE/Veteran s Business Participation Questions 22. Q: Is material participation only relative to construction services? A: No, it is also applicable to all development team members, service providers and vendors. 23. Q: Relative to MBE/WBE/Veterans participation is this category a maximum of ten (10) points? A: Yes. Please refer to Tab 16 for further details. Third Party Reports Questions 24. Q: What is the shelf life for third party reports from last round? Are extensions to these time frames available? A: The Agency has updated the program requirements set forth in the Multifamily Guidelines to extend the timeliness of certain reports. Please refer to the Multifamily Guidelines for the updated report requirements.
Lending Programs/Contingent Financing Questions 25. Q: If the Application is seeking points for applied for funding which requires the developer fee contribution of 25%, does it count towards the uncommitted funding limitation of 50% developer s fee? Also, if you have applied for funds from the Federal Home Loan Bank, for example, and end up not being awarded those funds, do you still get the points? A: Yes, applied for funds is included in the 50% developer s fee limitation. In order to be considered for ranking point consideration in this category, the amount equal to or less than 25% of the developer s fee must remain in the financing plan in the event funding is not secured. Additionally, the Agency will use identified applied for funding as a source in determining the amount of tax credits awarded. 26. Q: Do PennHOMES funds applied for in the application count as committed funding? A: Yes, PennHOMES funds would be considered as committed funding and is not part of the 50% reinvested developer s fee limitation. 27. Q: As the extended use/affordability period has now been increased from 30 to 35 years, will the term of the PennHOMES loan also now be increased to 35 years as well? A: This is currently being reviewed by the Agency. Please refer to our website for future guidance. 28. Q: How does the Agency know if we have applied for various funding sources? A: All sources of funds must be disclosed on the Certification of Subsidies form completed and submitted in the Application. 29. Q: The Allocation Plan states that the amount of funds to be applied for cannot exceed 25% of the developer s fee. Does this mean that it cannot go over that amount? A: The Agency will only consider an amount up to 25% of developer s fee for consideration for points. Again, no more than 50% can be pledged from the developer s fee, including any uncommitted funding and any other funding gap. 30. Q: How do we determine the amount of the funding gap? Are PHARE and PennHOMES considered as secured/committed? A: The Agency does not consider PHARE or PennHOMES requests when determining the funding gap analysis. These funds are treated as committed. 31. Q: Will the PHARE funds (including Housing Trust Funds) for 2017 and 2018 be combined for the 2018 funding round? A: It is anticipated that any funds not allocated will rollover to the next funding round in 2018. 32. Q: Is there any guidance on the amount of PHARE funds that we should be requesting? A: We expect that PHARE funds will be limited. It is suggested that you request what you need but it may be reduced depending on availability.
Development Cost Savings Questions 33. Q: Is there a comparison on Passive House under the Development Cost Savings ranking criteria? To date, the Agency does not have final cost data on these projects. 34. Q: Are the comparisons for the Development Cost Savings category by number of units or square footage? A: Square footage. 35. Q: Development Cost Savings In a mixed income development, does the Agency look at the total square footage? A: Yes. We use all residential space. 36. Q: Are the previous year s median costs used to determine Development Cost Savings available? A: Yes. They will be posted to the Agency s website. Intent to Submit/Electronic Submission Questions 37. Q: What if the investor changes between the Intent to Submit and the actual application submission, will it be an issue? 38. Q: Can we start the Application, save it and complete it at a later time? A: Yes, as long as you don t click finalize and hit the Intent to Submit button. 39. Q: Can two people log on to the same Application? A: Yes, as long as they both have the same login information (username and password) for the application. And only one person can be logged on at any one time. 40. Q: Is the Intent to Submit being capped at six (6) projects like the Application submission limitation? A: No, but it is strongly suggested that no more than six (6) be submitted. 41. Q: Can you copy and paste from a WORD document? A: Yes. 42. Q: Is the website browser specific? 43. Q: Can you download the Intent to Submit form? A: Yes, once it is created, the form can be downloaded. 44. Q: Can you submit one PDF for each tab? A: Yes.