FY 2002 NOFA - Frequently Asked Questions (FAQs)

Questions and Answers

1. The NOFA states that you may request funds to revitalize a scattered site public housing project if the sites fall within a one square mile area. Does the one square mile radius represent a circle with a radius of one mile?

Yes. The only exception is that if you identify a larger site, the scattered site units must be located within the hard edges of a neighborhood. See Section VI(D)(4) of the NOFA.

2. Current HOPE VI Revitalization Grantees are subject to a threshold and a rating factor that measure their performance on their existing grants. How are these determined?

The Threshold (Section VII(A)(3)(b) of the NOFA) states that such applicants must meet their performance requirements as required in the applicable HOPE VI Revitalization Grant Agreement by the application due date. Grantees will be considered in compliance if they have met extended deadlines as approved by HUD. If an applicant does not meet this threshold, the application will not be considered for funding.

The rating factor (Section VII(B)(2)(a) of the NOFA) looks at whether an existing Grantee has carried out the stated activities as they were originally scheduled, regardless of a HUD-approved extension. If an applicant does not meet this rating factor, the application will lose 5 points.

3. In relation to the capacity of existing HOPE VI Revitalization Grantees, how must a PHA document/certify that no outside program manager was used for its existing HOPE VI Revitalization grant?

Section VII(B)(2)(a) instructs applicants (who have received HOPE VI Revitalization grants in the past) that points will be deducted if the applicant has not carried out the certain activities (Supplemental Submissions submitted; CSS Workplan submitted; Program Manager procured; and Master Development Agreement executed) within the timeframes established in the first schedule entered into the HOPE VI Quarterly Report system, regardless of extensions HUD may have approved. The rating factor further explains that HUD will determine this factor based on internal information on existing grants. The PHA would need to state that no program manager was procured and that the PHA served as its own program manager, in accordance with the NOFA under which the PHA was awarded HOPE VI Revitalization grant funding and the respective HOPE VI Revitalization Grant Agreement.

4. Section VII(A)(5) says that an applicant must have procured a developer by the application due date. Does this mean an applicant must have executed a full development contract?

In order to satisfy the threshold requirement at Section VII(A)(5), an applicant must certify that they have procured a developer for the first phase of construction by the application due date, in accordance with 24 CFR 85.36 and 24 CFR 941.602(d) (as applicable), or that the PHA will act as its own developer. It is not necessary to have executed a full development contract by the application due date. However, please note that, in accordance with Section VII(A)(5), HUD reserves the right to rescind the grant if you change developers after you are selected for funding. In order to earn one point in accordance with Section XV(B)(3)(c) an applicant must certify that a Master Development Agreement has been developed and is ready to submit to HUD. Where the PHA acts as its own developer, it must certify that a Master Development Agreement has been developed and is ready to submit to HUD in order to earn the one point.

5. For off-site units, does a contract outlining the parameters of the purchase, with contingencies as outlined in the NOFA, constitute site control?

As stated at Section XIV(B)(4), an applicant must provide evidence in their application that they (not their developer) have site control of any properties proposed for the development of off-site housing. Evidence may include the option to purchase the property (which must extend for at least 180 days after the application due date), contingent solely on the receipt of the HOPE VI grant, satisfactory compliance with the environmental review requirements of accordance with Section XX of this NOFA, and the site and neighborhood standards in Section XIII(C)(3). Such examples of evidence would include a contract outlining the parameters of the purchase, with contingencies as outlined in the NOFA.

6. When calculating Capital Fund obligation rates, should housing Replacement Funds be excluded?

Replacement Housing Factor funds are not excluded from the calculation of Capital Fund obligation rates, pursuant to 24 CFR 905.10(i), as they are a part of the Capital Fund Program formula allocation.

7. Could you explain the conflict of interest restrictions of Section XIX (C)(1)?

Section XIX(C)(1) of this NOFA prohibits conflicts of interest, in addition to the conflict of interest requirements at 24 CFR Part 85. In addition to employees, agents and officers, prohibitions apply to consultants and elected or appointed officials of the Grantee. In addition to financial interest or benefit in any contract, also prohibited are such interests or benefits in any subcontract or agreement or the proceeds thereunder. These prohibitions continue for the person's tenure or for one year thereafter. HUD-Approved exceptions may be considered in accordance with the provisions in XIX(C)(2).

20. Section VI(B)(2) says a PHA must disclose "all prior HUD public housing assistance received for the project(s) you have targeted for the physical revitalization…." What categories of information would that include and how far back must you go?

Section (VI)(B)(2) is a threshold requirement that requires applicants to disclose all prior HUD public housing assistance received for the project(s) targeted for the physical revitalization related to the proposed revitalization activities. Accordingly, applications must disclose any public housing funds they have received for Capital Improvements as far back in time as possible.

21. Section V(G)(3)(c) says a PHA cannot use HOPE VI funds to pay for non-public housing office facilities. Can a PHA still use HOPE VI funds to pay for a rental office in a mixed-income rental complex even if all of the units are not under an ACC?

Yes. A PHA can use HOPE VI Revitalization funds to pay for a rental office in a mixed-income rental complex, even if all units are not under an ACC, provided that the public housing residents are still the primary beneficiaries.

22. What income guidelines apply to potential homeowners who purchase homes that have been renovated with HOPE VI funds prior to sale? Can HOPE VI funds be used to rehabilitate public housing units for sale to low and moderate income families? Can HOPE VI funds be used to rehabilitate public housing units for sale as market units?

HOPE VI funds can be used to rehabilitate public housing units for sale to low and moderate income families up to 80 percent of median income, provided that the homeownership program is developed in accordance with Sections 24 or 5(h)/32 of the U.S. Housing Act of 1937. In accordance with Section VI(D)(7), HOPE VI funds cannot be used to rehabilitate public housing units for sale as market rate units which do not qualify as public housing or homeownership replacement units. It should be noted that, in accordance with Section I(C) of the NOFA, public housing agencies, not individuals, can apply for HOPE VI Revitalization grant funding.

23. Section XIII(C)(2) says an applicant must be "in full compliance with any desegregation or other court order related to Fair Housing." Who defines "full compliance"?

HUD's Office of Fair Housing and Equal Opportunity (FH&EO) determines compliance with any desegregation or other court order related to Fair Housing, in accordance with the 2002 HOPE VI Revitalization NOFA.

24. If a public housing site is no longer appropriate for residential purposes, can all the replacement housing go into a distressed neighborhood if the intention is to reinvest in minority neighborhoods, improving the quality and affordability of housing in the distressed neighborhood as a way to provide a real choice for assisted households, as described in Section XIII(C)(3)(b)(ii)?

Yes, replacement housing can be developed in a distressed neighborhood, provided that it is done in accordance with the site and neighborhood standards stated at Section XIII(C)(3). Section XIII(C)(3)(e) states HUD will consider the location of replacement housing, on site or in the surrounding community, in assessing the application for funding under the 2002 HOPE VI Revitalization NOFA.

Additionally, in accordance with Section XIII(C)(1), as a threshold requirement, all applicants and their subrecipients must comply with all Fair Housing and civil rights laws, statues, regulations and executive orders as enumerated in 24 CFR 5.105(a). In accordance with Section XIII(C)(2), as a threshold requirement, applicants must be in full compliance with any desegregation or other court order related to Fair Housing that affects their public housing and is in effect on the application due date. In accordance with Section XIII(C)(3)(c), applicants comply with the Fair Housing Act and Title VI of the Civil Rights Act of 1964, and implementing regulations, in determining the location of any replacement housing.

25. Could you explain in more detail the term "area of minority concentration," as described in Section XIII (Fair Housing and Equal Opportunity) (C)(3)(g).

HUD believes that Section XIII of the NOFA provides sufficient criteria and references to define the term "area of minority concentration."

26. When discussing leverage, HUD requires applicants to have firm commitments. Can HUD define "firm"?

Firm commitments must be evidenced by a written agreement, to provide specific amounts of cash, signed by an official legally able to make the commitments on behalf of the organization. The written agreement may only be contingent upon receiving a HOPE VI grant award.

27. Section IX(A)(5) says, "Grantees must pursue and enforce any commitment (including commitments for services) obtained from any public or private entity for any contribution or commitment to the project or surrounding area that was used for leverage in their HOPE VI applications." How does HUD suggest this be done?

HUD believes Section IX(A)(5) is self-explanatory. Grantees are expected to pursue and enforce commitments that were obtained in a reasonable and justifiable manner.

28. Section IX(D)(6) discusses types of resources that may be counted as leverage. It says, "Funds committed to build private sector housing in direct connection with the HOPE VI Revitalization Plan" may count. Can you explain this further?

In accordance with Section IX(D), types of development resources that may be counted as leverage include funds committed to build private sector housing in direct connection with the HOPE VI Revitalization Plan. This would mean that the development of the private sector housing will occur as a direct result of the proposed HOPE VI revitalization.

29. In Section IX, could you clarify how cash and in-kind services can be used in order to count towards the match?

Match requirements as described in Section IX (A) is limited to cash. Leverage and other resources described in Section IX (B) - (F) is not limited to cash and may include in-kind services and other types of contributions such as tax credits.

30. Must a mixed-finance proposal be submitted for HUD review before the HOPE VI Revitalization application is due? Must a homeownership proposal be submitted for HUD review before the HOPE VI Revitalization application is due?

No, a mixed finance proposal or homeownership proposal should not be submitted to HUD prior to the application.

31. Are design principles of New Urbanism still a part of the HOPE VI Revitalization Program?

Applicants should consult the NOFA for criteria related to design. The concepts of New Urbanism, though not specifically named in this NOFA, remain principles of design in the HOPE VI program.

32. Can replacement units be a different size than the units being replaced?

Yes, replacement units can be a different size than the units being replaced.

33. Under Section XV(B)( 3), the NOFA indicates that the applicant will receive 1 point "if you have held 5 or more public planning sessions leading to resident acceptance of the Plan." In Section X(A)( 2), the NOFA requires applicants to hold at least one training session and, in Section X(A)(3), at least three public meetings to involve residents and stakeholders in developing the Plan. Do the public meetings count toward the 5 public planning sessions?

Yes, the three public meetings required by Section X(A)(3) may count toward the five public planning sessions, as would the one training session required by Section X(A)(2). These are threshold requirements and must be certified to in order to be considered for funding. In order to receive the one point possible at Section XV(B)(3)(e), you must be able to demonstrate that you have held five or more public planning sessions.

34. Does Section VII (A)(6)(b) mean that an applicant must formally comply with 24 CFR 966.3 (the requirement that residents be given 30 days to comment on lease changes) before a HOPE VI grant application is filed?

No. Section VII(A)(6)(b) states that an application must include a certification that you will ensure that you and/or your procured property manager have complied (to the extent required) with the provisions of 24 CFR 966.3 in planning for the implementation of the operation and management principles and policies described in Section VII(A)(6)(b)(i)-(viii).

35. Could you clarify Section XIV(B)(4) and (5), concerning site control for off-site properties and environmental site assessments, as stated at Section XX? Must an applicant complete a Phase I environmental site assessment prior to submitting the HOPE VI application in order to meet the threshold?

An applicant does not need to have a Phase I environmental site assessment completed in order to be funded and to meet the threshold described at Section XIV(B)(4). However, in order to receive the one point at Section XIV(B)(5)(b), the applicant must demonstrate the Phase 1 has been completed.

36. Section VIII(B)(1)(d) says, “You will receive 3 Points if you demonstrate that there are extreme levels of unmitigated lead-based paint, PCBs, mold, and/or asbestos that make the site or a portion of the site and its housing structures unsuitable for residential use.” What is the implication for scoring if a PHA has already abated environmental hazards. Is it penalized on this factor?

In accordance with Section 24(a) of the U.S. Housing Act of 1937, the purpose of the HOPE VI Revitalization program is to address severely distressed public housing projects, through improvements of the physical living environment for residents, revitalization of the severely distressed sites and surrounding community, provision of housing to avoid or decrease concentration of very low-income families, and building of sustainable communities. Accordingly, in order to receive points under this NOFA related to need for revitalization, including Section VIII(B)(1)(d), applicants must respond to the stated criteria.

37. Section XIV(A)(1) says you can earn up to 3 points if you propose a mixed income community on the site with more than 35% of the units being ACC units. What if the site is no longer suitable for housing and you do not plan to build back on-site? Do you get the points for this factor?

In order to receive points under Section XIV(A), applicants must respond to the criteria stated in that section. To get the three points possible under Section XIV(A)(1), your application must propose a mixed-income, well functioning community on the revitalized site that includes a unit mix of more than 35 percent public housing units.

38. If a PHA wants to supplement a HOPE VI grant with other public housing funds (i.e. Capital Funds or Housing Replacement Factor Funds) does this reduce the maximum HOPE VI grant?

No, if a PHA wants to supplement a HOPE VI grant with other public housing funds, it does not reduce the maximum grant amount that an applicant can request. However, the project must be developed within the TDC/HCC limits applicable to the project.

39. Section VIII(B)(1)(c) says, "You will receive 3 points if you demonstrate that the project has major design deficiencies, including:….," and then lists five criteria. Do you need to demonstrate that all 5 criteria apply to the targeted project to get the full 3 points?

It is not necessary to meet all five criteria listed under Section VIII(B)(1)(c)(i)-(v). Rather, an applicant must be able to demonstrate that the project has "major design deficiencies," which would include the conditions listed at Section VIII(B)(1)(c)(i)-(v). An applicant must be able to show that the design deficiencies of the project targeted for revitalization are both major and within the criteria listed under Section VIII(B)(1)(c)(i)-(v).

40. Section VII(A)(6)(b)(iii) mentions lease requirements that promote "involvement in the resident association." What can an applicant legally do in this area? What have you seen from previous grantees?

Section VII(A)(6)(b) advises applicants that, if they become HOPE VI Revitalization Grantees, they will be required to develop Management Agreements that describe operation and management principles and policies for their public housing units. Accordingly, applicants must certify that they or their procured property manager have complied (to the extent required) with the provisions of 24 CFR 966.3 in planning for the implementation of the operation and management principles and policies described at Section VII(A)(6)(b)(i)-(viii). These resource references should provide sufficient guidance on how to encourage self-sufficiency by including lease requirements that promote involvement in the resident association, as well as performance of community service, participation in self-sufficiency activities, and transitioning from public housing. HUD is not permitted to provide examples of previous grantees work for the application process, as that would constitute technical assistance.

41. Section VIII(B)(3) says "HUD will use data from the latest quarterly obligation report available at the time of the grant application deadline date to determine the amount of unobligated FY 1999-2001 Capital Grant (including CIAP and CGP) funds currently available that could be used to carry out the proposed revitalization activities. Applicants must ensure that their obligation and expenditure information was updated in LOCCS prior to March 31, 2002, unless an extension has been approved by the Deputy Secretary. Information provided in the application will not be considered, except in the case of some moving to work applicants, which are not required to enter obligations into LOCCS in accordance with their MTW agreements. Those PHAS must provide a certification of their obligation rate in their applications in order to receive any points for this rating factor." Which LOCCS report will HUD use: September 30th (the last one before the deadline) or March 31st? What does an MTW agency have to do?

In order to meet the threshold requirement stated at Section VII(A)(2) of this NOFA, an applicant must have obligated no less than 90 percent of its FY 1998-1999 Capital Funds, as required by the Quality Housing and Work Responsibility Act of 1998, by September 30, 2001, unless an extension has been approved by the Deputy Secretary. HUD will use the LOCCS disbursement system to determine the obligation rate as of September 30, 2001. Those MTW applicants, who are exempt from the statutory Capital Fund obligation and expenditure deadlines, will not be subject to this provision. If an applicant does not satisfy this threshold requirement, their application will be ineligible for funding.

In order to receive points under the rating factor found at Section VIII(B)(3), an applicant must have ensured that their obligation and expenditure information was updated prior to March 31, 2002 (the deadline for such updates). HUD will use the latest quarterly obligation report available at the time of grant application deadline, which would be from September 30, 2002, to determine the amount of unobligated FY 1999-2001 Capital funds. As stated also at Section VIII(B)(3), MTW applicants which are not required to enter obligations into LOCCS must certify to their obligation rate in their application in order to receive points for this rating factor.

42. Anticipatory Resources Leveraging is a new concept. Do past neighborhood improvements in the targeted neighborhood count or just on-site previous expenditures?

HUD encourages applicants to review Section IX(G)(3) and (4) for the rating factors addressing Anticipatory Resources Leveraging and Collateral Investment Leveraging. In accordance with Section IX(G)(3), anticipatory resources may include expenditures that occurred on the site of the targeted development or in the surrounding neighborhood. However, it should be noted that these expenditures cannot duplicate any other type of resource, and cannot be counted towards match.

43. In order to receive relocation or replacement vouchers, a PHA must have a 97% lease-up rate. When is your lease-up rate measured to determine whether or not you get the vouchers?

HUD will measure the lease-up rate as of the end of each PHA's most recent fiscal year.

44. The NOFA requires applicants to have control and proper zoning for any off-site properties in the plan. Does this mean you do not need to have things like subdivision approvals, building permits, etc.?

If an applicant plans development on off-site properties, they must have site control and proper zoning approvals for those properties, or the confirmation that the request for zoning approval is on the agenda for the next meeting of the appropriate zoning authority. Subdivision approvals and building permits are not necessary at the application deadline.

46. Section VI(C)(4) requires a certified cost estimate. Can the certifier be a member of the Team but not a PHA or City employee? Can you give more examples of an other qualified third party professional?

Section VI(C)(4), states that applicants must, in order to meet the threshold requirement, have cost estimates certified to meet the standards of Sections VI(C)(1) through (3) by an independent cost estimator, architect, engineer, contractor, or other qualified third party professional. These examples listed provide sufficient explanation of the term, "other qualified third party professional." The term "third party" indicates that the cost certification must be performed with an individual/entity that is not on the applicant's Team or associated with the applicant by employment, such as PHA or City employees.

47. If an applicant has an outstanding IG audit finding that is in litigation (beyond the control of the grantee), would they fail to meet the threshold requirement under Section VII(A)(3)?

Section VII(A)(3)(a) states that an applicant who has one or more existing HOPE VI Revitalization grants, and who has an open IG or GAO audit finding related to the HOPE VI or Capital Fund Programs as of the date of the application due date, will be disqualified. If an applicant has an outstanding IG audit that is in litigation (coded as "J" in HUD's system) they will not be disqualified for funding consideration on this threshold. All other open IG or GAO findings would require disqualification, in accordance with the Section VII(A)(3)(a).

48. Does an applicant need to meet the tax credit requirements of Section IX(D)(10) in order to be eligible to apply?

The Low-Income Housing Tax Credit requirements under Section IX(D)(10) apply if you intend to use Low-Income Housing Tax Credits as a development resource in your proposed revitalization plan.

49. Can committed funds be used as match and leveraging?

No. The first 5% of committed funds will be counted as match, and additional funds will be used for leveraging. This applies to the CSS match requirement as well.

50. Section XIV(A)(1)-(4) states that an applicant will receive points based on the percentage of "public housing units" in the unit mix of their on-site housing. Does the term "public housing units" include all ACC units, i.e., public housing rental and public housing funded homeownership?

The term "public housing units" is limited to units under the ACC, i.e., public housing rental units. Homeownership units would not be counted after the property has been transferred to the homeowner.
Please see FAQ #77 for clarification on FAQ #50

Questions 51 onwards >>