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HomeMy WebLinkAboutAgenda - 11-08-2018 2 - Proposed Guidelines for the New Orange County Local Rent Supplement Program (OC-LRSP) ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: November 8, 2018 Action Agenda Item No. 2 SUBJECT: Proposed Guidelines for the New Orange County Local Rent Supplement Program (OC-LRSP) DEPARTMENT: Housing and Community Development/Orange County Housing Authority ATTACHMENT(S): A. Proposed Program Guidelines B. Draft Implementation Timeline C. HUD’s 2019 Fair Market Rents INFORMATION CONTACT: Sherrill Hampton, Housing and Community Development Director, (919) 245-2490 PURPOSE: To review the proposed guidelines for the New Orange County Local Rent Supplement Program (OC-LRSP) and provide comments in preparation for an upcoming regular meeting, authorizing the Manager to execute the necessary agreement(s) with the Orange County Housing Authority to administer the Program. BACKGROUND: The Orange County Board of County Commissioners, on June 19, 2018, approved an initial $100,000 appropriation for a new local voucher program known as the OC Local Rent Supplement Program. In addition, the HOME Consortium, now known as the Local Government Affordable Housing Collaborative and consisting of the towns of Carrboro, Chapel Hill, and Hillsborough, as well as Orange County, approved a recommendation to award $139,613 in FY 2018-19 HOME funds to be used for Tenant-Based Rental Assistance. Of the aforementioned amount, $114,613 would serve as leveraged resources for the new OC Local Rent Supplement Program. The remaining amount of $25,000 will be used for the Rapid Re- Housing Program. The federal Department of Housing & Urban Development (HUD) approved the FY 2018-2019 HOME grant award on October 3, 2018, and the grant agreement was fully executed on October 10, 2018 by the County Manager. The new OC Local Rent Supplement Program (OC-LRSP) in many aspects mirrors the federally-funded Housing Choice Voucher (HCV) Program. However, it is also designed to allow for flexibility in meeting local identified housing needs. For the full program overview and proposed guidelines of the new OC-LRSP, see Attachment 1. In addition, a draft implementation timeline and a copy of HUD’s FY 2019 Fair Market Rents (FMRs) are also included as Attachments 2 and 3, respectively. The listed rents serve as the payment standards for the rental subsidies offered under the new program. It should be noted that there has been an increase in the FMRs in FY 2019 as opposed to those originally cited for FY 2018. OC- 1 LRSP is able to handle the increase in rents due to the leveraging of the HOME funds. However, the increased amount of HOME funds for rent subsidies will decrease the availability of funds for security deposits and utility connections. Nevertheless, monies from the Risk Mitigation/Housing Displacement Fund could be allocated to also cover the increase but these are usually one-time payments. FINANCIAL IMPACT: A financial impact is anticipated based on the need for increased amounts of rental subsidy due to the increase in Fair Market Rents. SOCIAL JUSTICE IMPACT: The following Orange County Social Justice Goals are applicable to this item: • GOAL: FOSTER A COMMUNITY CULTURE THAT REJECTS OPPRESSION AND INEQUITY The fair treatment and meaningful involvement of all people regardless of race or color; religious or philosophical beliefs; sex, gender or sexual orientation; national origin or ethnic background; age; military service; disability; and familial, residential or economic status. • GOAL: ENSURE ECONOMIC SELF-SUFFICIENCY The creation and preservation of infrastructure, policies, programs and funding necessary for residents to provide shelter, food, clothing and medical care for themselves and their dependents. • GOAL: CREATE A SAFE COMMUNITY The reduction of risks from vehicle/traffic accidents, childhood and senior injuries, gang activity, substance abuse and domestic violence. RECOMMENDATION(S): The Manager recommends that the Board review the proposed guidelines for the new Orange County Local Rent Supplement Program (OC-LRSP) and provide comments in preparation for an upcoming regular meeting, authorizing the Manager to execute the necessary agreement(s) with the Orange County Housing Authority to administer the Program. 2 1 Attachment 1 PART I: OVERVIEW OF THE NEW ORANGE COUNTY LOCAL RENT SUPPLEMENT PROGRAM (OC-LRSP) A. OVERVIEW The Local Rent Supplement Program is a new rental subsidy program approved by the Orange County Board of County Commissioners on June 19, 2018 with an initial injection of capital in the amount of $100,000. The County’s HOME Consortium, the Local Government Affordable Housing Collaborative, is providing $114, 613 in FY 2018-2019 HOME funds for tenant-based rental assistance as leveraged funds to assist in the implementation of the OC-LRSP. The County will enter into an agreement with the Orange County Housing Authority (OCHA) to administer the new program. The OC-LRSP provides monthly rental subsidies that cover the difference between the rents that low-income families and individuals can afford to pay and the actual monthly cost of rent for the unit. The new program addresses one of the priority housing needs identified in Orange County’s FY 2015-2019 Consolidated Plan, as well as the recently released Affordable Housing Coalition’s 2018 Affordable Housing Summit Report. The new program is designed to complement the federally-funded Housing Choice Voucher (HCV) Program, which is administered by OCHA and will assist families and individuals who earn 50% or less of the Area median Income with priority going to those who are very low income (30% of AMI or less). The program promotes community-wide planning and strategic use of resources to address the jurisdiction’s unmet needs and to narrow the gap in benefits and services received by cost-burdened families. For the most part, and unless otherwise specified, OC-LRSP will follow the rules and regulations of the HCV Program. However, some of the differences between OC-LRSP and HCV Program are that OC-LRSP’s rental subsidies are not for housing outside a 10-mile radius of the County’s jurisdictional boundaries. Therefore the subsidies are not “portable” and are only available to Orange County residents. In addition, the preferences and priorities for the housing assistance are different than those specified in the HCV Program rules and regulations. Furthermore, the rental assistance may be administered as tenant-based and/or project-based. If project-based is utilized then an RFP will be released and proposals solicited from eligible landlords. In the future, OC-LRSP may be amended to include sponsor-based rental assistance as a methodology for incentivizing new affordable housing multi-family development. B. PURPOSE The purpose of the OC Local Rent Supplement Program (OC-LRSP) is to provide rental assistance in the form of a monthly rental subsidy to Homeless/At Risk of Homelessness persons and families, Senior/Disabled persons, and Victims of Domestic Violence who are at or below the fifty (50) percent of the Area Median Income limit. 3 2 PART II: PROPOSED PROGRAM GUIDELINES Orange County Local Rent Supplement Program (OC-LRSP) ELIGIBLE SUBSIDY COSTS • The total proposed cost of the Local Housing program is $203,6201 and the break-out of units with associated costs are as follows: o 5 one bedroom units @ $902 per month for 12 months =$54,120 o 5 two bedroom units @$1,055 per month for 12 months = $63,300 o 5 three bedroom units @ $1,435 per month for 12 months = $86,100 • HOME Tenant-Based Rental Assistance (TBRA) allocation of $114,6132 will support the needed difference of $103,620 for rental subsidies. • Of the $114,613 identified above, $10,993 will be used to cover security and utility deposit payments; and • If additional funds are needed to cover security and utility deposit payments, OCHA will make a request for Risk Mitigation/Housing Displacement Funds, as well as for applicable assistance from other jurisdictions. However, these funds are often available on a one-time basis and may not be used for ongoing utility assistance as is provided under the federally-funded HCV Program, which provides monthly utility assistance to applicable low and very low income households. RENTAL ASSISTANCE The amount of the monthly assistance that OCHA will pay on behalf of a family, may not exceed the difference between the rent payment standard for the unit size and thirty (30) percent of the family’s monthly adjusted income. SECURITY DEPOSITS A limited number of security deposit grants will be provided to eligible applicants, subject to the availability of funds and at the sole discretion of the OCHA. Participants must document, in writing, their efforts to secure security deposit funding from other sources and demonstrate insufficient personal funds. The maximum amount of funds that may be provided for the security deposit is the equivalent of two months’ contracted rent for the unit. Only the tenant (not the landlord) may apply for security deposit assistance. THE TERM OF THE RENTAL ASSISTANCE The term of the rental assistance contract may not exceed twelve (12) months, but may be renewed, subject to the availability of annual appropriations from Orange County or the program, and at the discretion of the OCHA. FUNDING POLICIES AND PROCEDURES The OCHA will make annual funding requests to Orange County for the program. In turn, the County will request HOME TBRA funds, as well as provide Risk Mitigation/Housing Displacement funds based on the availability of applicable program funds. The Orange County Board of County Commissioners will review and approve all policies, procedures and guidelines, as well as amendments. The Orange County Housing Authority Board of Commissioners, serves as the Board of Directors for the Housing Authority, adopts policies and 1The proposed total program cost increased due to the increase in HUD’s Fair Market Rents (FMRs) for 2019. The FMRs usually increase each year based on market conditions. 2 The proposed FY2018-2019 HOME allocation was approved by the BOCC on June 19, 2018 and by HUD on October 3, 2018. 4 3 procedures annually. The Local Rent Supplement Program adheres to the federally-funded HCV Program model, unless otherwise noted in these Guidelines. If there is a conflict between program regulations and the HCV Administrative Plan, the OC Local Rent Supplement Program regulations have precedence. In addition to evidence of eligibility required under the HCV Program, applicants must meet one of the following requirements to qualify for the Local Rent Subsidy Program: 1. Homeless Individuals 2. Homeless Families, including those who may have children in child protective services 3. Person At Risk of Homelessness, including those who may have children in child protective services 4. Senior/Elderly and Disabled Individuals 5. Victims of Domestic Violence And 1. Be at or below the HUD fifty (50) percent AMI limit ELIGIBILTY The Orange County Housing Authority requires that households, at time of entry into the program, be at or below fifty (50) percent of the Area Median Income (AMI). Additionally, the OCHA must provide at least fifty percent (50%) of its local vouchers to applicants whose income does not exceed thirty (30) percent of the AMI. HUD income limits may also be used since they are similar to Housing Choice Voucher income limits. APPLYING TO THE WAITING LIST Any individual/family who wishes to receive rental subsidies under the OC Local Rent Supplement Program must apply for admission to the program. The Local Rent Supplement Program has a separate Waiting List and assistance is restricted to persons who are at or below fifty percent (50%) of the AMI. Priority will be given to Homeless Individuals/Families, Persons At Risk of Homelessness, Senior/Elderly Disabled Individuals, and Victims of Domestic Violence. ACESSIBILITY OF THE APPLICATION PROCESS The application will be available on the Orange County Website, as well as at local libraries, the Department of Social Services (DSS), Community Centers and various service providers throughout the County. The Application period will run from February 1, 2019 – February 8, 2019. Persons having questions or needing assistance in completing the application may contact the Orange County Housing Authority/Department of Housing and Community Development at (919) 245-2490 or the TDD Number at (919) 644-3045. OUTREACH AND MARKETING The new program will be announced on the County’s website and through newspaper ads beginning in mid-January 2019. In addition, OCHA will hold a briefing for applicable area service providers. Full Implementation Timeline: • January 14, 2019 – Announce new OC-LRSP • January 17, 2019 – Hold Briefing for Service Providers • Application Period Opens – February 1, 2019 • Application Period Closes – February 8, 2019 5 4 • Reviewing Applications and Determining Preliminary Eligibility – February 11- March 15, 2019 (Screening period may be extended due to the number of applications received.) • Conduct Briefings and Begin Issuance of New Vouchers – March 25 – April 30, 2019 SCREENING AND ASSESSMENT The OCHA requires that any agency making referrals to screen applicants for eligibility based on the guidelines outlined in this document and to submit to the OCHA required documents included in the Local Rent Supplement Program Application Packet. Completed documents will be used by the PHA to: 1. Determine applicant’s eligibility 2. Select participants 3. Notify applicants of their obligations as an OC-LRSP recipient Completed application and verifications must be current within the last sixty (60) days. Referring agencies and case managers must conduct a thorough screening and assessment of each individual’s care needs. The screening will include assessment of the individual’s ability to live independently. In addition, the individual must not present a danger to himself or others and the individual must not require a level of care that is not offered by OC Local Rent Supplement Program. EVIDENCE OF ELIGIBLITY Homelessness/At Risk Homelessness Certification The Local Rent Supplement Program applicants, who qualify under the definition of Homelessness, must provide the following documentation at the time of application to establish that they meet the required criteria: 1. The Local Rent Supplement Program applicant’s written certification that they have insufficient financial resources and support networks immediately available to attain housing stability 2. Documentation to verify that the Local Rent Supplement Program applicant did not have sufficient resources or support networks immediately available to attain housing stability as evidenced by one of the following: a. Source documents (e.g., notice of termination from employment, bank statement, health care bill showing arrears); or b. Written statement by referring agency staff confirming that they spoke to a relevant third party to verify homelessness or at risk homelessness status; or c. Written statement by referring agency staff of the efforts taken to obtain verification through source documents and relevant third parties d. Verification that the Local Rent Supplement Program applicant met one of the seven conditions under the definition of Homelessness as evidenced by one of the following: i. Source documents that evidence one or more of the conditions; 1. A Homeless/At Risk Homelessness Certification Form completed 6 5 by a service provider. 2. A written statement by a relevant third party or the written certification by referring agency staff of the oral verification by the relevant third party that the applicant meets one or more of the conditions; or 3. A written statement by the referring agency staff that the staff person has visited the applicant’s residence and determined that the applicant meets one or more of the conditions or, if a visit is not feasible or relevant to the determination, a written statement by the referring agency staff describing the efforts taken to obtain the required evidence. 3. In addition, one or more of the following should be provided: a. A written documentation of observation by an outreach worker; b. A written certification by the household seeking assistance that demonstrates that the individual or head of household is currently homeless and living in a place not meant for human habitation, in an emergency shelter, or a safe haven. Senior/Elderly Disabled Certification A birth certificate or other official record of birth is the preferred form of age verification (must be at least 62 years of age or older). An original document that provides evidence of the receipt of social security retirement benefits is acceptable. In order to receive Disabled/Disabling Condition preference, the Local Rent Supplement Program applicants must present evidence of disabling condition diagnosis with one or more of the following conditions: substance use disorder, serious mental illness, developmental disability as defined by the Department of Housing and Urban Development (HUD). A disabling condition is defined by HUD as: 1. A physical, mental, or emotional impairment which is expected to be of long-continued and indefinite duration, substantially impedes an individual’s ability to live independently, and of such a nature that the disability could be improved by more suitable conditions; 2. A developmental disability as defined in section 102 of the Developmental Disabilities Assistance and Bill of Rights Act; 3. The disease of acquired immunodeficiency syndrome or any conditions arising from the etiological agency for acquired immunodeficiency syndrome; or 4. A diagnosable substance abuse disorder. Evidence of this criterion must include one of the following: a. Written verification of the condition from a professional licensed by the state to diagnose and treat the condition; b. Written verification from the Social Security Administration; c. Copies of a disability check (e.g., Social Security Disability Insurance check or Veterans Disability Compensation); 7 6 d. Intake staff (or referral staff) observation that is confirmed by written verification of the condition from a professional licensed by the state to diagnose and treat the condition that is confirmed no later than fourteen (14) days of the application for assistance and accompanied with one of the types of evidence above; or other documentation approved by HUD. Victim of Domestic Violence The Local Rent Supplement Program applicants, who qualify under the definition of Victim of Domestic Violence, must provide the following documentation at the time of application to establish that they meet the required criteria: 1. The individual may satisfy the PHA’s request by providing any one of the following three forms of documentation [24 CFR 5.2007(b)]: a. A completed and signed HUD-approved certification form (HUD-50066, Certification of Domestic Violence, Dating Violence, Sexual Assault, or Stalking), which must include the name of the perpetrator only if the name of the perpetrator is safe to provide and is known to the victim; b. A federal, state, tribal, territorial, or local police report, or court record, or an administrative record; or c. Documentation signed by a person who has assisted the victim in addressing domestic violence, dating violence, sexual assault, or stalking, or the effects of such abuse. This person may be an employee, agent, or volunteer of a victim service provider; an attorney; a mental health professional; or a medical professional. The person signing the documentation must attest under penalty of perjury to the person’s belief that the incidents in question are bona fide incidents of abuse. The victim must also sign the documentation. TENANT SELECTION Selection Criteria Families will be selected based on the following targeted population selection criteria and selection preference method. Within the preference category, families and individuals will be selected based on severity of needs. The OCHA system of preferences may select families either according to the date and time of application, or by a random selection process. When selecting families from the Waiting List OCHA is required to use targeted funding to assist only those families who meet the specified criteria, and OCHA is not permitted to skip down the waiting list to a family that it can afford to subsidize when there are not sufficient funds to subsidize the family at the top of the waiting list. Targeted Population: • Homeless Individuals • Homeless Families, including those families who may have children in child protective services 8 7 • Person At Risk of Homelessness, including families who may have children in child protective services • Senior/Elderly and Disabled Individuals • Victims of Domestic Violence Families and individuals must meet the requirements and eligibility criteria of one of the above targeted population groups to qualify for the Local Rent Supplement Program. Homelessness/At Risk Homelessness For Homelessness and At Risk of Homelessness applicants, severity of needs is identified and verified through the use of Homelessness/At Risk Homelessness Certification Form and submitted source documents. Senior/Disabled applicants and Victims of Domestic Violence For Senior/Disabled applicants and Victims of Domestic Violence applicants, severity of needs is identified and verified through the use of the submitted source documents. CRIMINAL BACKGROUND All participants will undergo criminal background and sex offender checks based on the Housing Choice Voucher (HCV) regulations. DENIAL OF ASSISTANCE An applicant will be denied participation in the Local Rent Supplement Program if the applicant does not meet Local Rent Supplement Program specific admission criteria. Participation will also be denied if the Local Rent Supplement Program applicant does not provide: 1. Information that the OCHA determines is necessary in the administration of the program 2. Complete and true information and it is discovered that the applicant does not meet eligibility requirements BRIEFINGS AND VOUCHER ISSUANCE The applicant, together with all adult members of the household and the assigned case manager (if applicable) must be present for the initial briefing and voucher issuance. Upon the completion of the initial briefing, a Local Voucher/Rent Subsidy voucher will be issued to the applicant. Local Rent Supplement Program participants have up to 120 days to search for a unit within the Orange County geographic area and submit a Request for Tenancy Approval (RTA) to the OCHA upon finding a suitable unit. If an extension is needed, one may be requested. The request will be evaluated and a decision made based upon the same policy outlined in the voucher issuance section of Chapter 5 of the OCHA Housing Choice Voucher Administrative Plan (Proof of Effort must be submitted to the OCHA). TENANT RENT PORTION Program participants are required to pay a portion of their rent if they are receiving assistance under OC Local Rent Supplement Program. Participants’ rent must be equal to the highest of: 9 8 • 30 percent of family‘s monthly adjusted income; • 10 percent of family’s monthly gross income; or • A minimum rent of $50 contribution. The PHA has authority to suspend and exempt families from minimum rent when a financial hardship exists. HOUSING QUALITY STANDARDS (HQS) HQS unit inspections are required both at initial occupancy and annually thereafter for all Local Rent Supplement subsidized units. Newly leased units must pass the HQS inspection before the beginning date of the assisted lease and the Local Voucher Rent Supplement Housing Assistance Payment (HAP) Contract. RENT REASONABLNESS Rent reasonable review must be conducted before Local Rent Supplement Program participant rents a unit. The OCHA will pay rents up to the rent reasonable amount, not to exceed the exceptional payment standard utilized for the PHA’s HCV Program. MOVING WITH CONTINUED ASSISTANCE AND PORTABILITY Under the OC Local Rent Supplement Program, the OCHA issues an eligible family a voucher and the family selects a unit of its choice within the Orange County geographic area, as specified earlier in these guidelines. If the family moves out of the unit, the contract with the owner ends and the family can move with continued assistance to another unit within the Orange County geographic area. Local Rent Supplement Program participants are not eligible for portability and must remain within the Orange County geographic area. ANNUAL/INTERIM REEXAMINATIONS The OCHA is required to process annual re-examinations. In cases where a family experiences a change in household composition and/or income between annual re-examination, the PHA will process an interim re-examination. The family is required to report all changes in household composition and/or income to the OCHA within 10 calendar days of the occurrence. RENTAL INCREASES Landlords may submit a request for a rent increase every other year and approval is based on availability of funding and rent reasonableness for the tenant. TERMINATION OF ASSISTANCE AND TENANCY The OCHA is required to terminate a family’s assistance if certain program rules are violated. For other types of offense, the OHCA has the discretion to either terminate the family’s assistance or to take another action. All participants must adhere to Section 8 Housing Choice Family Obligations and Informal Reviews/Hearings process. 10 Attachment 2 ORANGE COUNTY LOCAL RENT SUPPLEMENT PROGRAM (OC-LRSP) DRAFT IMPLEMENTATION TIMELINE 1 1 The February 11 – March 15, 2019 screening period may be extended due to the number of applications received. 11 FY 2019 Fair Market Rent Documentation System—Calculation for Durham-Chapel Hil... Page 112 f 7 I FY 2019 FAIR MARKET RENT DOCUMENTATION SYSTEM The FY 2019 FMRs for All Bedroom Sizes Final FY 2019 FMRs By Unit Bedrooms Year Efficiency One- Two- Three- Four- Bedroom Bedroom Bedroom Bedroom FY 2019 $834 $902 FMR $1,055 $1,435 $1,624 FY 2018 $731 $847 $990 $1,356 $1,512 FMR Orange County, North Carolina is part of the Durham-Chapel Hill, NC HUD Metro FMR Area, which consists of the following counties: Chatham County, NC; Durham County, NC; and Orange County, NC. All information here applies to the entirety of the Durham-Chapel Hill, NC HUD Metro FMR Area. Fair Market Rent Calculation Methodology Show/Hide Methodology Narrative Fair Market Rents for metropolitan areas and non-metropolitan FMR areas are developed as follows: 1. 2012-2016 5-year American Community Survey (ACS) estimates of 2-bedroom adjusted standard quality gross rents calculated for each FMR area are used as the new basis for FY2019 provided the estimate is statistically reliable. For FY2019, the test for reliability is whether the margin of error for the estimate is less than 50% of the estimate itself and whether the ACS estimate is based on at least 100 survey cases. HUD does not receive the exact number of survey cases, but rather a categorical variable known as the count indicator indicating a range of cases. An estimate based on at least 100 cases corresponds to a count indicator of 4 or higher. If an area does not have a reliable 2012-2016 5-year, HUD checks whether the area has had at least minimally reliable estimate in any of the past 3 years, or estimates that meet the 50% margin of error test described above. If so, the FY2019 base rent is the average of the inflated ACS estimates. https://www.huduser.gov/portal/datasets/fmr/fmrs/FY2019_code/2019summary.odn 10/29/2018