Title
Amended Local Housing Assistance Plan-SFY 2005-2006/2006-2007/2007-2008 (B)
Amendment to the Local Housing Assistance Plan to increase the: 1) maximum SHIP Down payment Assistance Program award and HOME Down Payment Assistance Program award from $3,500 to $5,000; 2) maximum income limit for SHIP eligible applicants from 80% of median family income adjusted for family size to 120% of median family income adjusted for family size; and 3) sales price or value of an existing or new dwelling unit that can receive SHIP assistance from $125,000 to $200,000, as allowable by the SHIP Program. The maximum sales price or value limit will also apply to applicants receiving assistance from the CDBG or HOME Programs.
Explanation
As housing prices continue to rise much faster than incomes, the housing affordability issue persists throughout the state of Florida. Since its inception, the Down Payment Assistance Program has been one of the City's major housing assistance programs for income-eligible first-time homebuyers. Although the maximum amount of assistance and sales price limit have remained fairly constant for years, until recently, the number of households assisted by the Down Payment Assistance Program has remained very solid. Recently, the Down Payment Assistance Program experienced a sharp decline in the number of households assisted. Since October 2005, only a few households have requested and received down payment assistance; however, the demand for homebuyer training and pre-application submittals have remained constant. Staff continues to process approximately 30 pre-applications per month to attend the Homebuyer Education and Training workshop. This presents a serious concern which must be addressed as staff examines strategies to increase the program's effectiveness.
As a result, these amendments to the LHAP are being requested due to the substantially increased cost of purchasing a new or existing single family home. If approved, these amendments will assist in providing more affordable homeownership opportunities for very low, low and moderate-income first-time homebuyers. In addition, the City Housing Division and Alachua County Growth Management Department (County) administer a joint partnership to implement the homebuyer education and training component of the Down payment Assistance Program. The County recently approved an amendment of their LHAP with similar program changes. It is anticipated that these program changes will help to facilitate greater participation in the program. The Florida Housing Finance Corporation has conducted a courtesy review of the amendments, and has provided a pre-approval of the program changes to the LHAP.
Fiscal Note
Funds are budgeted in the Housing Division's SHIP Program budget.
Recommendation
The City Commission: 1) approve the maximum sales price or value of an existing or new dwelling unit to $200,000; 2) approve the maximum award to $5,000 as follows: $3,500 due on sale loan and $1,500 grant; 3) approve the maximum income limit for eligible SHIP applicants to 120% of median family income adjusted for family size; 4) approve resolution number 060089 amending the City of Gainesville Local Housing Assistance Plan for State Fiscal Years 2005-2006/2006-2007/2007-2008; 5) authorize the City Manager or his designee to execute the required documents and certifications; and 6) authorize submission of the amended plan for review and approval by the Florida Housing Finance Corporation.
Alternative Recommendation A:
The City Commission could choose not to approve the Resolution. This would result in keeping the current LHAP at the maximum: 1) down payment assistance award at $3,500; 2) income limit for SHIP eligible applicants at 80% of median family income adjusted for family size; and 3) sales price or value of an existing or new dwelling unit that can receive SHIP assistance at $125,000.
Alternative Recommendation B: The City Commission could choose to approve an amended LHAP to include any combination of the program changes noted above.