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DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY ACKNOWLEDGEMENTS Destination Home: A Strategic Guide to the Development of Homeless Housing in Riverside County is a report prepared by Polis Consulting Group, Inc. on behalf of the Department of Public Social Services of the County of Riverside. This report would not have been possible without the help received from many public and private organizations throughout the County, for which the author is very grateful. Principal Consultants Polis Consulting Group, Inc. Geoffrey Gilbert-Hamerling. Ph.D Dave Ryan, M.A. Mary Arutunian Thelma Herrera, Graphics Specialist Should you have questions, comments or input, please feel free to contact: firstname.lastname@example.org Additionally, you can contact: County of Riverside Department of Public Social Services Homeless Programs Unit (951) 358-5636 T H E D EV E HOME: N T O F H O GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE G U I D E DESTINATIONLO P M EA STRATEGICM E L E S S H O U S I N G I N R I V E R S I D E CO U N T Y: A ST R AT EG I C COUNTY DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY CONTENTS Executive Summary ......................................................................................................... i 1) Typology of Housing for Homeless Persons .............................................................1 2) Homelessness and Special-Needs Homeless Populations..........................................7 3) The Development Process .......................................................................................15 a) Site Identiﬁcation Through First Year Operations b) Critical Path Analysis c) Design Considerations d) Program Development: Housing First Strategies and Systems Change e) Leverage & Development Capacity f) Rental Assistance and Operating Subsidies Project-Based Rental Assistance g) Financial Analysis - Feasibility Sample Budgets Sample Pro Formas 4) Model Programs .......................................................................................................67 OPCC Cloverﬁeld Services Center Martha’s Village and Kitchen, Dan Dunlap Center SRO Housing Corporation 5) Local Government Coordination: Challenges and Opportunities ..........................85 Coordination and Resource Allocation Coordination and Land Use Entitlements Coordination and Leadership Coordination and the Continuum of Care Planning Process Confronting the NIMBY Challenge DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 6) Development Strategy for the County of Riverside ..............................................103 a) Program Goals and Outcome Measurement b) Data Management and Client Tracking c) Development Goals by Supervisorial District: 5 year and 10 year goals d) Development Goals by Special-Needs Population: 5 year and 10 year goals e) Monitoring Performance f) Reporting APPENDICES: A) Resources for the Development and Operation of Homeless Housing and Programs • Instructions for the use of the Resource Grid • Resource Grid (1) Development Resources (2) Resources for Operations (3) Supportive Social Services Resources B) Inventory of Homeless Programs of Riverside County • Emergency Shelter • Transitional Housing • Supportive Housing C) Acronyms D) Bibliography E) Persons Interviewed DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY B uilding housing to assist homeless persons and families depends upon a number of critical factors, each of which must be in place for development to ensue. Firstly, there need to be capital resources available to assemble the land, obtain proper approvals, draft plans, construct the housing, and cover the many other indirect or soft costs associated with development (e.g., insurance, legal matters, appraisals, environmental studies, etc.). In short, capital resources must be available. Secondly, development depends upon ongoing operating support (or subsidy) as the incomes of the program participants are generally capable of paying only minimal rent (if any). Thirdly, development requires an agency with both the capacity and the will to undertake the project, see it through to completion, and to establish management practices that will sustain the project’s feasibility and maintain its effectiveness through time. The Destination Home: A Strategic Guide to the Development of Homeless Housing in Riverside County includes a discussion of the challenges and opportunities of creating new residential resources for homeless populations. This report includes a typology of housing resources to assist a variety of homeless populations (Section 1). The second section of the report includes a discussion of the special needs of a number of homeless sub-populations. Section 3 provides a comprehensive analysis of the development process, from securing a site, to obtaining ﬁnancing and completing construction. This section lays out the complexities of developing and operating housing for homeless populations. Among the key factors impacting development are: proper location (taking into account the availability of services, transportation, and environmental concerns); securing land entitlements; resistance of local residents; and ﬁnancial feasibility. In addition, the report includes a discussion of program i DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY design as there is a substantive difference (both in terms of costs and service delivery) in creating private accommodations with beds (that may help to preserve the dignity and integrity of individuals and families) and serving more persons in cots at a congregate mass shelter. Among the most critical factors that may challenge the development of shelters and housing for homeless populations is the apparent lack of local capacity. Existing service providers almost universally lack the experience needed in affordable housing development and management to undertake this kind of work. Developers, including affordable housing developers, generally shy away from the added challenges and problems associated with creating units that are affordable and suitable to persons emerging from homelessness. The general lack of local development capacity is a substantive barrier that seems to put the onus on local governments to undertake the planning and development work. Included in Section 3 are model budgets and cash ﬂow projections used to assess the level of ﬁnancial assistance that may be required of federal, state and local sources to develop and manage new residential resources. These budgets include relative costs per program participant over the course of a year. Capital and operating budgets are included for emergency shelters and transitional housing programs of different sizes. These programs differ markedly relative to the scope of development, as well as the types and levels of services they offer, so comparisons are problematical but costs have been detailed at the per square foot level to assist in budget preparation. Permanent and permanent supportive housing are looked at as development types that have received a good deal of attention over the past decade. Budgets for the development and operation of permanent housing are also included in the section. The budgets are sufﬁciently detailed so that the reader may assess the level and range of services compared against their costs and expenses. This is particularly important as resources to sustain program operations have been few and (with the exception of the Mental Health Services Act) will likely continue to shrink over time. To develop model programs in the current funding environment is increasingly challenging. This section of the report also includes a discussion of recent changes in the primary resource to assist homeless populations, the HUD McKinney-Vento Act. The analysis also includes a thorough discussion of the critical need for operating assistance and how this alone poses one of the most signiﬁcant barriers to new development of homeless resources in Riverside County. ii DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Section 4 of the analysis singles out three model programs and uses them to reinforce issues raised in the third section of this report. In particular, the report includes descriptions of a new multi-service center in Santa Monica, Martha’s Kitchen and Village in Indio (to highlight transitional housing services), and the work of the Single Room Occupancy housing Corporation in downtown Los Angeles. Section 5 addresses the need for local government coordination, particularly as related to providing leadership in light of adverse reactions to proposed new development by local homeowners and others. This section of this report also includes a summary of the various resources that may be available at the local level to develop and operate new shelters and housing. The sixth section draws upon matters raised in the previous sections of the report and identiﬁes the most critical gaps in residential resources by Supervisorial District. This analysis shows that while a number of resources are currently available, they are not disbursed evenly throughout the County. Rather, a concentration of homeless resources can be found in Supervisorial District 4, while Supervisorial District 5 has hardly any residential programs. The imbalance is considered both in real and relative terms, meaning that the analysis takes into account the need to ﬁll the actual gap and how the districts with each other in terms of existing resources. In addition, Section 6 seeks to prioritize development options both within each Supervisorial District and across districts. This section of the report further investigates the need for local resources to develop new housing for homeless persons and families. The report includes an estimate of the costs to construct 215 new units and to operate them over time. Section 6 concludes with a set of recommended next steps that may help stimulate development of new residential options for homeless persons. These recommendations include practical steps to grow local development capacity, as well as general policies that may help to alleviate the problem of homelessness in Riverside County. Because new resources are scarce, the analysis includes a discussion of the critical need to prioritize where new housing should be developed. In addition to the analytical sections, this report includes a Resource Matrix grid and program descriptions to assist others determine the suitability of various resources in their development plans. The matrix includes the primary public sources available to fund the development of a range of housing types and conﬁgurations that may be occupied by homeless and formerly homeless persons and families. The Resource Matrix is organized iii DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY in three main sections: development (i.e. capital funds available to fund components of the continuum of care); operations (e.g., rental assistance subsidies and other forms of operating support); and supportive social services (differentiated by eligible services). In addition, the Resource Matrix includes information on the various populations that may be eligible to receive assistance through each program; the match requirements of each program are also included in this summary document. The Resource Matrix may be seen as an organizing tool that shows the breadth of resources to draw upon to ﬁnance a particular project. It also identiﬁes whether a program is funded through federal or state block grants or competitively. In short, the Resource Matrix summarizes the universe of resources available to assist homeless populations. Each program included on the Resource Matrix is more fully described in a separate narrative included as a substantive appendix. iv DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 1 SECTION T he following typology has been created to explicate the range of housing resources that may be developed to assist homeless persons and families. This range of housing for homeless populations is frequently thought of as providing a “continuum of care.” It should be noted that depending on management practices and the conﬁguration of a building, a speciﬁc development may be seen as constituting more than a single type. For example, an emergency shelter with on-site supportive services that permits persons to stay for up to a year may well be considered a transitional housing program according to the deﬁnitions that follow. This typology should be regarded as a tool to help better understand a speciﬁc project, rather than a rigid classiﬁcation system into which a development must exclusively fall. HUD allows localities to deﬁne what they regard as constituting an emergency shelter. In general an emergency shelter may be seen as a public or private facility in which occupancy is voluntary and no fee is charged for use. This deﬁnition would exclude jails and prisons owing to the involuntary nature of occupancy. It would also exclude “ﬂop houses” that charge rent. Providers of emergency shelter permit “guests” to remain housed for variable periods, largely dependent upon funding sources. Supportive social services (including meals, case management, transportation assistance, etc.) may or may not be available to the “guests.” In most cases, emergency shelters provide congregate settings in reconﬁgured commercial properties (especially warehouses). A less frequent emergency shelter conﬁguration is to provide for private occupancy in single room occupancy units. Outside third parties pay the operating costs so that a shelter may remain open; because no rent is paid, tenancy is generally not established. Section 1: Typology of Housing for Homeless Persons 1 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Transitional housing differs from emergency shelter in three fundamental respects: 1) the availability of supportive social services, 2) tenancy rights, and 3) a limitation on the maximum term of occupancy. The kind of spaces and units used as transitional housing is extremely varied. Some programs are operated out of reconﬁgured warehouses; others use standard rental units in the community. What most distinguishes transitional housing from other housing are the special-needs populations for which they are developed and the corresponding management practices. Among the supportive services that are frequently found at transitional housing programs are: nutrition services, case management, transportation assistance, referrals for medical, dental and psychiatric services, life-skills training, money management, and socialization. The availability of on-site services depends in large part on the funding under management control. Because most transitional housing programs charge rent (at 30 percent of adjusted income), residents enjoy the protections of landlord/tenant law. These protections have been somewhat limited in California which has in place a statute known as the Transitional Housing Participant Misconduct Act (THPMA). THPMA allows for a less than full judicial review in order to terminate tenancies in a transitional housing program, but it should be noted that the act preserves certain rights of appeal (see California Health and Safety Code §50580 et seq). When transitional housing was ﬁrst being developed in the 1980s, the expectation was that occupancy should be limited to no more than 18 months. Over time this standard has been extended so that tenancy is generally limited to no more than 24 months. Recognizing that certain persons may require longer periods of supervision and support (and wanting to alleviate staff time from reviewing and approving speciﬁc waiver requests for extensions), HUD ultimately eliminated the maximum tenancy period under certain circumstances. At 24 CFR §583.300 (i) the regulations state: Limitation on stay in transitional housing. A homeless individual or family may remain in transitional housing for a period longer than 24 months, if permanent housing for the individual or family has not been located or if the 2 Section 1: Typology of Housing for Homeless Persons DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY individual or family requires additional time to prepare for independent living. However, HUD may discontinue assistance for a transitional housing project if more than half of the homeless individuals or families remain in that project longer than 24 months. Inasmuch as tenancies occasionally extend beyond 24 months, the distinction between transitional housing and supportive housing is not hard and fast. Supportive housing differs from transitional housing with respect to two key factors: 1) the limitation on tenancy (and the availability of the THPMA remedy for problem tenants), and 2) whether or not supportive social services may be mandated. Supportive housing allows for permanent tenancy and as such the units are commonly built to standards consistent with other affordable developments. Mass shelters and shared housing are the exceptions, but some programs have been developed that create such conﬁgurations. Because the majority of (formerly) homeless residents of supportive housing are disabled individuals, only a small number of family-style supportive housing units have been developed. It is quite common for supportive housing to include specialized space for the delivery of case management services and group activities. While access to supportive services is encouraged, a landlord may not mandate the receipt of services. The point of supportive housing is to establish a stable residential environment for disabled (formerly homeless) persons; it is not to make housing a goal to be achieved once having satisﬁed a prescribed service program. Single room occupancy (SRO) is deﬁned as a dwelling unit intended to be occupied by a single person. SRO units have been used as emergency shelter, transitional housing, and permanent housing. The units are typically small (between 160 SF and 500 SF) and they generally do not contain either private bathrooms or kitchens. Bathrooms are usually developed at a ratio of about 1:8 units and each development includes a common kitchen. Efﬁciency (bachelor) units that include both a private bath and kitchenette may also be considered single room occupancy. Section 1: Typology of Housing for Homeless Persons 3 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY A Safe Haven is primarily deﬁned in terms of its ﬂexible management practices that allow for intermittent occupancy by persons with serious mental health (and other) disorders. The intent of a Safe Haven is to create a no-fail/high-tolerance environment where persons with mental illnesses (and co-occurring substance abuse and other disorders) may have a safe and secure place to stay on an around-the-clock basis. The expectation is that over time persons residing in a Safe Haven may increasingly avail themselves of supportive social services as they choose. Some Safe Havens allow for permanent occupancy so that in the event that a resident becomes “nomadic” or otherwise decides not to stay in the shelter/housing, he retains the right to return should he so desire. Occupancy rates in Safe Havens may vary widely as persons come and go throughout the day, and each resident has a designated space that is uniquely his own and to which he may return without sanction at any time. Shared housing has been another mechanism to assist homeless persons become re-settled in the community. Typically a shared housing arrangement takes the form of a group home in a single-family residence, what is commonly known as the “Oxford House” model. These group homes operate as follows: an organization, for example Oxford House Riverside, leases a single family residence from a private landlord. The lessee then monitors the behavior of the persons in recovery that it permits to take up residency. Oxford House-type programs operate with the expectation that should a resident relapse, he may be expelled immediately. Whether this legal theory holds merit or not is secondary to the fact that group homes have sprung up in nearly every quarter of the country. A 1995 decision by the U.S. Supreme Court (Edmonds v. Oxford House) afﬁrmed that for the purposes of zoning, Oxford Houses are to be considered single family residences. This had always been true in practice and in 1988 it was made a matter of law, codiﬁed in the Amendments to the Federal Fair Housing Act. Those amendments make it unlawful for any jurisdiction to discriminate against congregate living for the disabled. Recovering alcoholics and drug addicts are within the scope of the term “disabled.” Therefore, Oxford Houses are not subject to zoning laws regulating the number of unrelated individuals who may live in a single family dwelling. An Oxford House is not a treatment facility; it is simply an alcohol and drug free living environment which provides an opportunity for recovering individuals to live as a family unit focused on the need to change their individual lifestyle to one completely free of alcohol and drug use. 4 Section 1: Typology of Housing for Homeless Persons DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY While not housing per se, increasingly communities are developing access centers where homeless persons may obtain basic services, including temporary use of a cot for respite purposes. Access centers also go by the name of respite or drop-in centers. They differ from Safe Havens in that the center itself is regarded as a safe place to return and the homeless person does not possess any rights to a unique space. In fact, the Downtown Drop-in Center in Los Angeles’ Skid Row area (managed by the Volunteers of America) allows clients access to a cot for a maximum of eight hours at a time. Access Centers contain a broad range of supportive social services to help homeless persons and families become stabilized and enter the overall “continuum of care.” Section 1: Typology of Housing for Homeless Persons 5 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 6 Section 1: Typology of Housing for Homeless Persons DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 2 SECTION T he problem of homelessness is multifaceted, a result of escalating housing markets, limited incomes, and personal and social barriers to accessing housing. Recent research in the County of Riverside indicates that a number of sub-populations are represented among the ranks of the homeless. The 2004/2005 Homeless Assessment identiﬁed 765 homeless women who had experienced domestic violence (nearly two out of three homeless women). Mental health disabilities were also found to be prevalent among Riverside’s homeless, as well as persons with substance abuse disorders. The percentage of homeless men who reported to be Veterans was just about 25 percent. A number of resources are available to assist a number of special-needs homeless populations, and this section identiﬁes each sub-population and makes note of such funding. In general, a person is considered homeless if, without HUD assistance, he or she would have to spend the night in a homeless shelter or in a place not meant for human habitation. More speciﬁcally, an individual is considered homeless if he or she is: • sleeping in an emergency shelter; • sleeping in places not meant for human habitation, such as cars, parks, sidewalks, or abandoned or condemned buildings; • spending a short time (30 consecutive days or less) in a hospital or other institution, but ordinarily sleeping in the types of places mentioned above; 142USC11302 Section 2: Homelessness and Special-Needs Homeless Populations 7 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • living in transitional/supportive housing but having come from streets or emergency shelters; • being evicted within a week from a private dwelling unit and having no subsequent residence identiﬁed and lacking the resources and support networks needed to obtain access to housing; or • being discharged from an institution and having no subsequent residence identiﬁed and lacking the resources and support networks needed to obtain access to housing. This deﬁnition excludes persons who are incarcerated or who may otherwise be eligible for housing as part of a State-mandated program in which discharge from a public institution includes access to a housing resource. In addition, the deﬁnition includes an income test limiting eligibility to persons and families below 50 percent AMI. To encourage homeless persons to obtain the supports needed to re- enter the workforce, the statues allow participation in Workforce Investment Act programs regardless of income. Victims of Domestic Violence are in need of emergency housing services in a safe and secure environment. Beyond the need for immediate safety, persons in such circumstances (and their families) are often in need of assistance to settle in a new community. As homelessness caused by domestic violence has both a circumstantial component and a more long-term component (such abuse is frequently associated with substance abuse disorders), each household needs to be assessed according to its unique circumstances. In some instances a prolonged period of “recovery” from abuse may be required to re-acclimate the individual or family to a more normative domestic situation. This may be particularly true of youth who feel the need to ﬂee an abuser. In some cases, however, the individual or family may be sufﬁciently resilient to re- enter the housing market with only limited services and ﬁnancial support. Among the resources available to assist households made homeless because of domestic violence is the: • Transitional Housing Assistance Grants Program: This discretionary grant program provides transitional housing, short-term housing assistance, and related support services for individuals who are homeless, or in need of transitional housing or other housing 8 Section 2: Homelessness and Special-Needs Homeless Populations DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY assistance, as a result of ﬂeeing a situation of domestic violence, dating violence, sexual assault, or stalking, and for whom emergency shelter services or other crisis intervention services are unavailable or insufﬁcient. Support services should be designed to enable an individual ﬂeeing domestic violence, dating violence, sexual assault, or stalking to locate and secure permanent housing and to integrate into a community. Such services may include transportation, counseling, child care services, case management, employment counseling, and other services. Eligible applicants are states, units of local government, Indian tribal governments, and other organizations, including domestic violence and sexual assault victim services providers, domestic violence or sexual assault coalitions, other nonproﬁt, nongovernmental organizations, or community-based and culturally speciﬁc organizations that have a documented history of effective work concerning domestic violence, dating violence, sexual assault, or stalking. Other DOJ resources that may be combined with a program of outreach and assistance to homeless persons who may be victims of domestic violence are: • STOP Violence Against Women Formula Grant Program: STOP grants are awarded to states to develop and strengthen the criminal justice system’s response to violence against women and to support and enhance services for victims. Each state and territory must allocate 25 percent of the grant funds to law enforcement, 25 percent to prosecution, ﬁve percent to courts, and 30 percent to victim services. The remaining 15 percent is discretionary within the parameters of the Violence Against Women Act (VAWA). These grant funds may be used for victims with emergency services, but they are not primarily intended as a long-term resource for assistance. • Safe Havens: This discretionary grant program assists units of local governments to create safe places for visitation with and exchange of children in cases of domestic violence, child abuse, sexual assault, or stalking. These funds may be used to fund the following activities: o Establishment or expansion of supervised visitation and exchange services; o Development of community-based advisory committees to plan and/or implement visitation and exchange of services; o Development and implementation of policies and procedures regarding security, intake, case referral, record keeping, and conﬁdentiality; Section 2: Homelessness and Special-Needs Homeless Populations 9 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY o Enhancement of program services to address special needs of the target population (e.g., therapeutic services, directed visitation services, parent education groups); and o Development and implementation of effective training for project staff and volunteers. It has long been known that a large percentage of the homeless population suffers from serious mental health disorders. In Riverside County, over 50 percent of all homeless individuals reported symptoms of mental illness. The development of a range of housing types to assist persons with mental illness has recently been furthered by the passage of the Mental Health Services Act. This Act amended the State Constitution to provide a new stable resource that may be used to provide direct services and even housing for persons with serious mental health disorders, particularly those experiencing homelessness or who may be at risk. A number of other resources are available to assist homeless persons with mental illnesses, including federal grants from the Substance Abuse and Mental Health Administration (SAMHSA), a Division within the U.S. Department of Health and Human Services. A summary of the various resources that may be used to assist this special-needs population can be found in the Appendix to this report. It is all too common that homeless persons with serious mental health disorders will frequently “self-medicate” with illegal narcotics or alcohol. The population of homeless persons with substance abuse disorders certainly extends beyond those with co-occurring mental illnesses, but those with multiple diagnoses have been found to be particularly difﬁcult to serve and are thereby signiﬁcantly over-represented among the chronically homeless population. Chronic homelessness commonly means that a person has been living literally on the streets, in emergency shelters, or in other places not meant for human habitation for over a year, or has had three episodes of such homelessness in the past four years. The resources available to assist persons with substance abuse disorders (with or without co-occurring mental-illness or other disabilities) can be found in the Appendix to this report. It should be noted that one reason that persons with co-occurring disorders remain on the streets for prolonged periods is that most programs have been developed to exclude or dismiss persons who may use drugs or alcohol. Such “zero-tolerance” programs necessarily 10 Section 2: Homelessness and Special-Needs Homeless Populations DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY routinely result in poor outcomes as they expect a state of health and stability prior to a state of recovery and convalescence. This is not to condone the use of contra-indicated substances (especially illegal narcotics). Rather, the intent here is to point to a very real dilemma that is not easily resolved among program operators. Over the past decade a body of literature has been developed, written mostly by psychiatrists, who have grappled with the many challenges of treating persons with co- occurring mental illnesses and substance abuse disorders. As yet no consensus has been established within the psychiatric community, but a number of key lessons have been learned. Homeless persons living with HIV/AIDS (PWAs) present a unique challenge as they are in need of ongoing medical attention or risk poor medical outcomes (including fatality) and otherwise costly hospitalizations. There is a pressing need to see that PWAs access affordable housing to minimize the further transmission of HIV and to see that proper medical attention is made available. The Riverside County Department of Public Health reported 541 PWAs in its 2005 Communicable Disease Report.2 Fortunately, since 1993, the AIDS rate in Riverside County has gradually declined, but it is still marginally higher than California’s rate. Treatment advances have resulted in dramatic reductions in fatalities and in more people living longer with HIV. These improvements in healthcare both escalate the need to prevent transmission with proper risk reduction methods, as well as to attend to the non-chronic needs of this population (including that part that is homeless). A number of specialized resources are available for the medical care and supportive social service needs of PWAs, including Ryan White Care Act funds. HUD has a specialized program for PWAs known as the Housing Opportunities for Persons with AIDS (HOPWA) program. This is an important resource to assist this special-needs population to gain access to housing and supportive services. HOPWA funds may be used for the development of specialized shelters, transitional housing, and permanent supportive housing. A complete summary of the program appears in the Appendix. 2 Riverside County Department of Public Health, 2005 Communicable Disease Report, available online: www.rivcohealthdata.org/downloads/reports/CommDisease/cdr_05.pdf Section 2: Homelessness and Special-Needs Homeless Populations 11 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Unlike a mental illness or substance abuse addiction, being a veteran is not a barrier to housing. Rather, military service represents a period of service in one’s life. Unfortunately, such service is often a double-edged sword (sic). The vast majority of persons who serve in the armed forces emerge from the experience with a life experience that helps to prepare them for success in civilian occupations. A small number of veterans, however, fail to become sufﬁciently re-socialized to the norms of everyday life. There was a time when it was almost commonplace to consider homeless veterans to be Viet Nam era servicemen and servicewomen, but today the population is increasingly composed of persons returning from more recent active military duty. While it is unlikely that there may be something inherent in the experience of military service that may result in homelessness, what is clear is that a number of homeless assistance programs are specialized to address issues confronted by veterans. Whether or not veterans-speciﬁc programs show better outcomes than general programs to assist homeless populations is a matter that has not been resolved. However, what is certain is that veterans with honorable discharges are able to access a range of services that are otherwise unavailable to non-veterans or those with less than honorable discharges The State of California acknowledges Transitional Age Youth (TAY) to be those between the ages of 14 and 24. This age-group is eligible for a broad range of mainstream supportive social services and resources, but a number of programs have been developed speciﬁcally to address the needs of youth, particularly those exiting Foster Care. The 2004/2005 Homeless Assessment found that roughly one in 10 homeless adults stated that they had ﬁrst become homeless upon discharge from the Foster Care program, thus making it important to attend to the needs of this population to mitigate the needs of addressing its (likely more pronounced) needs in years to come. Unlike other special-needs populations, TAY may never have known a stable home environment, thereby exacerbating the challenges of bringing this population into a normative housing environment. As with any population, TAY requires the following life goals: 12 Section 2: Homelessness and Special-Needs Homeless Populations DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • A stable housing environment (which is affordable and safe) • Education • Employment • Social Skills and Life Skills • Health Care When complicated by mental health disorders or substance abuse addictions, or both, TAY will frequently ﬁnd the road to social stability to be particularly challenging. Unique resources are available to assist TAY either avoid homelessness or become more stable following homelessness. As this represents a generally small sub-population in Riverside County (only 18 persons included in the Homeless Survey), no additional special attention has been given to the resources available to assist this population. Over the past ﬁve years, HUD has paid increasing attention to chronically homeless populations. Chronic homelessness refers to those populations that remain unsheltered for considerable periods of time, typically as a result of pathological behaviors. This contrasts with episodic homelessness which may be caused by an emergent situation, like the loss of a job, divorce, or domestic violence. While HUD homeless resources may be used to assist any population that meets the basic deﬁnition above, some resources are targeted to chronically homeless populations. A chronically homeless person is essentially one that has been outside the traditional homeless services delivery system as well as the mainstream system of care for long periods of time. The ofﬁcial deﬁnition of a chronically homeless person is as follows: 3 The deﬁnition of chronic homelessness has not been issued as a formal Notice by HUD. Rather the deﬁnition was ﬁrst published in a Notice of Funding Availability for the Collaborative Initiative to Help End Chronic Homelessness/Federal Register, Vol. 68, No. 17/Monday, January 27, 2003, 4019. This deﬁnition is shared by the U.S. Department of Housing and Urban Development, the U.S. De- partment of Health and Human Services, and the U.S. Department of Veterans Affairs. Section 2: Homelessness and Special-Needs Homeless Populations 13 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY An unaccompanied homeless individual with a disabling condition who has either been continuously homeless for a year or more OR has had at least four (4) episodes of homelessness in the past three (3) years. A disabling condition is deﬁned as ‘a diagnosable substance use disorder, serious mental illness, developmental disability, or chronic physical illness or disability, including the co-occurrence of two or more of these conditions.’ In deﬁning the chronically homeless, the term ‘homeless’ means ‘a person sleeping in a place not meant for human habitation (e.g., living on the streets) or in an emergency homeless shelter.’ There are a number of key elements to this deﬁnition that are important to note. First, a chronically homeless person is a single (adult) person with a disability, not a family-member. Second, to be considered “chronic,” the homeless person has been either on the streets or in emergency shelters. This is a much narrower deﬁnition of homelessness than HUD typically uses as it disqualiﬁes any persons leaving either institutional settings or a transitional housing program. Homeless persons graduating from a transitional housing program are eligible for services, but they are intentionally excluded from projects targeted to chronically homeless persons. This restriction tacitly endorses a “housing ﬁrst” model. 14 Section 2: Homelessness and Special-Needs Homeless Populations DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 3 SECTION T here are a number of fundamental steps required to develop affordable housing for low-income households, particularly homeless ones. In particular, an appropriate site must be identiﬁed and acquired, then plans must be developed and ﬁnancing obtained prior to construction. This section describes many of the key critical elements of the development process. A survey of available properties will guide possible site selections, based on the size and conﬁguration of the lot and existing structures, community resources, and local need. Family housing rightfully should be close to schools and generally lenders will require that community amenities—schools, parks, recreation facilities, libraries—are available to make the units more “marketable.” Access to transportation is another important consideration (particularly for working residents), and the availability of hospitals and clinics is also a signiﬁcant factor that needs to be considered relative to site selection. Low-income working families also need a range of alternatives for their shopping needs. Identiﬁcation of community plan areas and residential or mixed-use zones is an approach to narrowing site options. Often nonproﬁt developers will consider parcels that are non- conforming because suitably zoned sites have been used by for-proﬁt developers. They look to key decision-makers to assist them in obtaining zone changes, plan amendments, and Conditional Use Permits so that a site may be used. Preliminary meetings with community members will provide information about the need for affordable housing, community perceptions, and potential issues in the zoning process. Section 3: The Development Process 15 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Once a suitable site has been identiﬁed, a developer will determine the general scale of the project: the size, number, and type of units, number of parking spaces, provision of open space and other on-site amenities. The developer will make a contingent offer based on knowledge of the market for land, and a preliminary ﬁnancial analysis based on the expected densities and cost of construction. Generally nonproﬁt developers put very little money down to secure a property during an investigative period. The Purchase and Sale Agreement will specify a period for initial ﬁnancing and feasibility studies, after which the deposit is increased and becomes “hard” or irrevocable. The ﬁrst stage of the escrow process involves due diligence in reviewing documents provided by the seller; review of title issues; obtaining an appraisal; a Phase 1 toxic study and follow- up, if required; development of architectural concepts; application for predevelopment ﬁnancing; and verifying the availability of local funds from redevelopment, HOME, CDBG or other sources. Operating subsidies through Section 8 and grants or other sources of funds are also investigated. Among the common contingencies included in purchase offers for sites to be used as affordable housing are site contamination, ﬁnance, relocation cost contingency, structural considerations, title, and appraisal. Once feasibility has been conﬁrmed, the property may be purchased or escrow extended until sufﬁcient ﬁnancing has been obtained. Finance, planning approval and design proceed simultaneously through the predevelopment period. The scope of the project is veriﬁed through design development and preliminary cost analysis. Numbers are reﬁned as the resources available to the project are identiﬁed: rental subsidies, city or county monies from redevelopment, HOME, CDBG or general fund; state bond funds; bank loans, federal Low Income Housing Tax credits, and funds available for social services. Design features are worked out so that the number of units and unit type (bedroom count, handicap etc) is ﬁnalized, and the height, yards and setbacks are deﬁned. The planning process is initiated with the Initial Study of the California Environmental Quality Act (CEQA) and review of the National Environmental Protection Act (NEPA). 16 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The developer identiﬁes a capable management agent and social service provider (unless they provide these services with its own staff) and integrates their perspectives on the development. The developer may also hold public meetings to solicit local opinion on the design and the project. City agencies and other funding sources may also require a review of the architectural plans at various stages, from concept and schematic plans to design development and construction documents. The developer is responsible for ensuring that the project meets all of the requirements of various lenders and investors. In addition, the developer ensures that the nonproﬁt goals of the project are consistent with IRS regulations, and that project accounting will meet the test of tax credit compliance (in the case of developments utilizing this key resource). As the scope of the project is solidiﬁed, cost estimates are commissioned to determine the construction cost of the project. Alternatively, the project may be bid out to contractors, or negotiated, so that a more exact price is obtained before applying for low income housing tax credits. The developer hires the architectural ﬁrm and the general contractor, and is also responsible for a number of other contracts: the management company, social service provider, lawyer, ﬁnancial consultant, title company, surveyor, soils engineer, cost estimator, appraiser, historic consultant, planning consultant, and other professionals. The developer is also responsible for making certain that sufﬁcient cash is available and that work is billed properly and paid promptly. Once the architectural plans are developed, the process of selection of a general contractor can begin. This may be done through a competitive bid process, or through a negotiated bid. The developer makes sure that the bid corresponds with the work shown on the architectural plans, and that the contract is sound. Requirements of lenders and tax credit investors often must be incorporated in the construction contract, in addition to prevailing wage requirements. Section 3: The Development Process 17 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Because most low-income housing developments involve ﬁnancing using the Low Income Housing Tax Credit program (among other sources) it is important to consider its impact on the development process. To utilize tax credits, the developer needs to successfully negotiate with a tax credit investor/partner based on a number of factors: the amount the investor will pay for tax credit equity, the schedule of the pay-in, fees for ongoing partnership management, terms of repurchase at the end of the 15-year tax credit compliance, and other factors. The developer needs to provide the investor with extensive information regarding the project and the organization to meet their underwriting process. The developer is responsible for obtaining ﬁnancing from local sources and the state. These agencies require review of the partnership documents, and the developer coordinates the reconciliation of different lenders’ requirements with the tax credit investors’. In addition, many projects require construction ﬁnancing from a private bank to bridge tax credit equity which is not available until units are occupied. The developer works with the architect to ensure that the building is constructed in accordance with the project documents. The developer monitors the contingency budget, approves change orders and monitors the construction schedule. He/she tracks conditional lien releases and makes sure that pay draws are correct and correspond with the prevailing wage provisions of the contract. The developer maintains a construction specialist or works closely with the architect to ensure proper construction and resolution of issues raised by inspectors. The developer signs off on pay draws. Management staff initiates advertising for new units and schedules interviews several months before the building is ready for occupancy. The developer provides furnishings and equipment for management and lobbies and other common areas. As the general contractor goes through ﬁnal building inspections, the developer must coordinate connection of gas, electric, telephone and internet services. 18 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY On granting of the building’s Certiﬁcate of Occupancy and the achievement of a stated occupancy level (usually 85 or 90 percent), construction loans are bought out by tax credit equity and/or permanent ﬁnancing and the developer receives a portion of their developer fee. In this period the management and social service plans are tested, evaluated and modiﬁed. The ﬁnal role for the developer is to ﬁle the 8609 tax form, certiﬁed by a CPA, which conﬁrms that the project has been built according to the terms proposed in the tax credit application. The chart that follows identiﬁes most of the key activities associated with the development of affordable housing for homeless populations. The chart is divided into four broad categories: I. Planning and Design II. Finance and Legal III. Construction IV. Management, Asset Management, and Social Services Within each of these categories a number of critical activities are identiﬁed with subtasks further identiﬁed. Each task has been assigned an Activity Code. For example parking considerations are identiﬁed as follows: I-K-6 (Planning and Design—Architect/ Schematic Design—Parking. To the extent that a major activity depends upon a prior activity it is identiﬁed in the column on the right of the chart labeled: Permanent, Transitional Housing, and Emergency Shelter. For example, obtaining ﬁnancial commitments from local government sources is dependent upon the following speciﬁc tasks pertaining to site control (I-C-3) having been completed: • Appraisal (a) • Studies (b) • Phase I Toxics Analysis (d) • Title Report (j) • Plus other tasks. Signiﬁcant milestones are identiﬁed in bold red lettering. Section 3: The Development Process 19 20 CRITICAL PATH ANALYSES BY HOUSING TYPE KEY DEPENDENCIES ACTIVITY CODE TASK PERM TH EMERG I PLANNING & DESIGN I A IDENTIFICATION OF NEED I A 1 Data Collection I A 2 Market Analysis n/a I A 3 Key-Informant Survey I A 4 Other Data (Census, Surveys, etc.) I B SITE SELECTION Brokers, Real Estate Agents, and/or Others I B 1 Experienced in Sites Appropriate for Redevelopment I B 2 Analysis of Zoning I B 3 Field Research (Consideration of Scoring Relative to Funding Sources) less critical I B Initial Feasibility Analysis I B 4 Physical Needs Assessment (if Rehabilitation) I B 5 Location and Transportation Analysis critical critical critical I C SITE ACQUISITION I C 1 Negotiation of Purchase and Sales Agreement I C 2 Site Control - Open Escrow I C 3 Satisfaction of Site-related Contingencies I C 3 a Appraisal I C 3 b Studies (Acoustics, Traffic, etc.) I C 3 c Utilities Will-Serve letter (if New Construction) I C 3 d Toxics Analysis-Phase 1 I C 3 e Toxics Analysis-Phase 2 if Required I C 3 f Mitigation Plan if Required by Phase 2 I C 3 g CEQA/NEPA Review I C 3 h Lead & Asbestos report I C 3 i Geotechnical Analysis I C 3 j Title Report I C 3 k Chain of Title I C 3 l Relocation Plan (if Occupied Property) I C 3 m ALTA Survey I C 3 n Market Study n/a Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY CRITICAL PATH ANALYSES BY HOUSING TYPE (CONT’D) KEY DEPENDENCIES ACTIVITY CODE TASK PERM TH EMERG I PLANNING & DESIGN (Continued) I D 4 ACQUISITION CLOSING I-C, II-A, II-B I-C, II-A, II-B I-C,II-B3 I E SELECTION OF DEVELOPER AND SPONSOR Development of RFP or RFQ Criteria for Selection Section 3: The Development Process Evaluation of Proposals I F IDENTIFICATION OF COUNTY AND CITY STAFF RESPONSIBLE FOR IMPLEMENTATION I F 1 Coordination Meeting I F 2 Identification of Resources and Tasks I G COMMUNITY SUPPORT I H SELECTION OF ARCHITECT AND ENGINEERS I H 1 Interviews/Discussion of Concept, Process, Fee, Staffing and Capacity I H 2 Negotiate Contract I H 3 Establish Design Timeline I I SITE PLAN I I 1 Design Concept I I 2 Site Capacity Analysis I J PLANNING ENTITLEMENTS I J 1 Zone Change if Necessary I J 2 Plan Amendment if Necessary I J 3 Density Bonus I J 4 Conditional Use Permit if Necessary I K ARCHITECT-SCHEMATIC DESIGN I K 1 General Design I K 2 Building Envelope I K 3 Number of Units I K 4 Configuration of Units I K 5 Other Amenities I K 6 Parking I K 7 Identification of Planning Issues I K 8 Open Space, Height Restrictions, etc. 21 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 22 CRITICAL PATH ANALYSES BY HOUSING TYPE (CONT’D) KEY DEPENDENCIES ACTIVITY CODE TASK PERM TH EMERG I PLANNING & DESIGN (Continued) I L ARCHITECT-DESIGN DEVELOPMENT I L 1 Unit Plans Key issue is mass shelter v. private units I L 2 Refine Concepts and Relationships of Building Features I L 3 Input from City, Developer, Management Agency, Community, etc. I M ARCHITECT-CONSTRUCTION DOCUMENTS I M 1 Create Drawings Suitable for Bidding & Plan Check Approval I M 2 Grading Plan I M 3 Mechanical Plumbing I M 4 Mechanical HVAC I M 5 Structural I M 6 Electrical I M 7 Disabled Access Features Articulated I M 8 Demolition Plan (if Necessary) I M 9 Specifications (Finishes) I N ARCHITECT-BID SET/PLAN CHECK I O PLAN CHECK I O 1 Submit to plan check I O 2 Review period I O 3 Plan corrections and response to plan-check comments I O 4 Obtain Planning Approval I-I, I-K, I-N, I-I, I-K, I-N, I-I, I-K, I-N, I-O, I-P I-O, I-P I-O, I-P I P PREVAILING WAGE DETERMINATION I Q SELECTION OF GENERAL CONTRACTOR THROUGH BID PROCESS OR NEGOTIATION OF BID I Q 1 Identify Bidders I Q 2 Prequalification’s I Q 3 Bidders' Meeting I Q 4 Issue Plans for Bidders I Q 5 Respond to Questions Through Bid Process Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY CRITICAL PATH ANALYSES BY HOUSING TYPE (CONT’D) KEY DEPENDENCIES ACTIVITY CODE TASK PERM TH EMERG I PLANNING & DESIGN (Continued) I Q 6 Award of Contract I Q 7 Compliance Review of Contracting Process and Bid I Q 8 Negotiation of Terms of Contract I Q 9 Sign Contract I Q 10 Bonding Requirements Section 3: The Development Process I Q 11 Compliance I Q 12 Section 3, Prevailing Wages I Q 13 Bonding I Q 14 Insurance I Q 15 Pull Building Permit I & II COMPLETED 23 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 24 CRITICAL PATH ANALYSES BY HOUSING TYPE (CONT’D) KEY DEPENDENCIES ACTIVITY CODE TASK PERM TH EMERG II FINANCE & LEGAL II A PROJECT FINANCES NEEDED II A 1 Pre-Development Financing II A 2 Acquisition Financing II A 3 Construction Financing II A 4 Permanent Financing II B FINANCE-LOCAL JURISDICTION(S) II B 1 Develop Finance Plan / Underwriting II B 2 Submit Applications for Permanent Financing II B 2 a Local Government Resources II B 2 b Redevelopment Funds II B 2 c CDBG Funds II B 2 d HOME Funds II B 2 e Other Local Funds critical II B 3 Obtain Local Government Finance Commitments I-C-3 I-C-3 I-C-3 (a-h, j,l,m) (a-h, j,l,m) (a-h, j,l,m) II B 4 Obtain Commitments of Operating Subsidies II B 5 Submit Applications for Construction Financing (private financing) n/a II B 6 Obtain Commitments of Construction Financing & 1st Trust Deed n/a II B 7 Submit Applications for Supportive Social Services II B 8 Obtain Commitments of Supportive Social Services IV-G-1-2 IV-G-1-2 II C FINANCE-NON-LOCAL SOURCES II C Submit Applications for Non-Local Permanent Sources II C 1 Federal Resources II C 2 State Resources (LIHTC and/or MHP) EHAP-CD II C 3 Obtain Commitments of Non-Local Permanent Sources I-C,I-E,I-I,I-J, I-C,I-E,I-I,I-J, I-K,K-L,I-M,I-Q, I-K,K-L,I-M,I-Q, I-R,II-B,II-B (4,8), I-R,II-B,II-B (4,8), IV-C3,IV-D(1-3), IV-C3,IV-D(1-3), IV-G2,IV-G4 IV-G2,IV-G4 II D Organization II D 1 Create Limited Partnership n/a II D 2 Create CHDO n/a Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY II D 3 Other Organizational Matters n/a CRITICAL PATH ANALYSES BY HOUSING TYPE (CONT’D) KEY DEPENDENCIES ACTIVITY CODE TASK PERM TH EMERG II FINANCE & LEGAL (Continued) II E IDENTIFY TAX CREDIT INVESTORS II E 1 Compare Rates n/a II E 2 Terms n/a II E 3 Exit Strategy at the End of Initial Compliance n/a Section 3: The Development Process II F NEGOTIATE PARTNERSHIP AGREEMENT WITH LIMITED PARTNERS (TAX CREDIT INVESTORS) II F 1 Pay-in for Tax Credit n/a II F 2 Terms of Partnership Agreement n/a II F 3 Schedule for Construction and Delivery of Credits n/a II F 4 Schedule of Pay-ins: Purchase, Construction, Developer Fees and Completion (8609) n/a II F 5 Ongoing partnership management n/a II G CLOSE CONSTRUCTION LOANS / TAX CREDIT EQUITY II G 1 Negotiate Loan Agreements II G 2 Negotiate Partnership Agreement n/a II G 3 Probable Maximum Loss Study n/a II G 4 Update of Documentation 25 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 26 CRITICAL PATH ANALYSES BY HOUSING TYPE (CONT’D) KEY DEPENDENCIES ACTIVITY CODE TASK PERM TH EMERG III CONSTRUCTION III A RECORDED NOTICE TO PROCEED / GROUNDBREAKING III A 1 Notice to Proceed III A 2 Groundbreaking Ceremony (Optional) III B ARCHITECT-CONSTRUCTION MANAGEMENT III C DEVELOPER-CONSTRUCTION MANAGEMENT III D CONSTRUCTION III D 1 Environmental Mitigation III D 2 Demolition III D 3 Grading and Excavation III D 4-20 All Other Trades III D 21 Final Inspections III E FIXTURES, FURNISHINGS AND EQUIPMENT III F UTILITY INSTALLATION AND CONNECTION III G INSPECTIONS AND BUILDING PERMIT SIGNOFF III H CLOSE-OUT III H 1 Temporary Certificate of Occupancy III H 2 Building Permit Signoff III H 3 Notice of Completion III H 4 Final Inspection for Certificate of Occupancy III H 5 Warrantees to Owner Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY CRITICAL PATH ANALYSES BY HOUSING TYPE (CONT’D) KEY DEPENDENCIES ACTIVITY CODE TASK PERM TH EMERG IV MANAGEMENT, ASSET MANAGEMENT & SOCIAL SERVICES IV A ASSET MANAGEMENT IV A 1 Accounting IV A 2 Insurance IV A a General Liability Insurance IV A b Coverage During Course of Construction Section 3: The Development Process IV A 3 Real Estate Taxes IV A a Tax Abatement IV B COMPLIANCE IV B 1 Preparation and Submission of Annual Reports to Lenders IV B 2 Tenant/Resident Verifications IV C CONTRACTING FOR MANAGEMENT SERVICES IV C 1 Selection Criteria IV C 2 Interview Firms & Make Selection IV C 3 Negotiate Contract IV D MARKETING AND LEASING IV D 1 Marketing Plan n/a IV D 2 Affirmative Fair Housing Marketing Plan n/a IV D 3 Lease-Up Schedule n/a IV D 4 Advertising and Interviews for Tenants n/a IV D 5 Tenant Certifications n/a IV D 6 Unit Inspections (PHA) n/a IV D 7 Tenant Move-In n/a IV D 8 Rent up to 90% occupancy n/a IV E AUDIT AND ACCOUNTING IV E 1 Project Accounting IV E 2 Construction Cost Certifications IV E 3 Annual Audit and Preparation of Partnership Tax Return n/a IV E 4 Filing of 8609 Tax Forms n/a 27 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 28 CRITICAL PATH ANALYSES BY HOUSING TYPE (CONT’D) KEY DEPENDENCIES ACTIVITY CODE TASK PERM TH EMERG IV MANAGEMENT, ASSET MANAGEMENT & SOCIAL SERVICES (Continued) IV F PROPERTY MANAGEMENT IV F 1 Up-keep, Maintenance, and Tracking of Warranted Items IV F 2 Rent Collection n/a IV F 3 Notices to Tenants IV F 4 Local Government Coordination IV G SUPPORTIVE SOCIAL SERVICES IV G 1 Needs Assessment Based on Resident Population IV G 2 Program Development / Program Planning IV G 2 a Tenant Engagement Strategies IV G 2 b Intakes IV G 2 c Assessments IV G 2 d Service Planning IV G 2 e Information and Referral IV G 2 f Direct Services IV G 2 g Tracking & Follow-Up IV G 3 Applications for Funding IV G 4 Approval of Funding Request IV G 5 Staffing IV G 5 a Recruitment, Hiring, and Background Checks IV G 5 b Staff Training and Development IV G 5 c Staff Evaluations and Monitoring IV G 5 d Program Evaluation IV G 6 Coordination with Property Management Staff IV G 7 Program Administration IV G 7 a Insurance IV G 7 b Accounting IV G 7 c Reporting Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The development of housing for homeless persons over the past few decades has tended to follow a rather predicable set of conﬁgurations. With respect to unit conﬁgurations, the key design consideration is whether to develop private units or group quarters. This is particularly true of emergency shelters and transitional housing facilities as shared permanent housing developments have not been especially common. The majority of emergency shelters have been built as congregate, barracks-style housing. A large number of such shelters have involved the reconﬁguration of warehouses or the adaptive reuse of commercial buildings. Only a handful of emergency shelters have been built with private accommodations in Southern California the most notable is the single room occupancy units used as emergency shelter by SRO Housing Corporation in the Skid Row section of Los Angeles. There is a substantive difference in providing truly private accommodations to persons with separately keyed entries. To hand a key to a person who has previously been homeless confers a measure of conﬁdence and dignity to him that is rare among homeless service providers. Placing homeless persons in open environments perpetuates the fundamentally public life of being without normative housing. Such open, public spaces frequently work against the therapeutic goal of recovery from homelessness in that they fail to re-establish a normative balance between the public and private spheres. Having noted this, the primary reasons that open mass shelters have been used are: 1) that they allow easy surveillance and supervision, and 2) that they are inexpensive to design and develop in contrast with private accommodations. It may be advisable for any new emergency shelters to allow for a combination of public and private spaces so that the unique needs of certain special-needs populations may be properly accommodated while realizing some of the cost savings of mass shelters. Such a design would mean that a certain number of private or semi-private units would be developed to be used by persons with serious disabilities or medical conditions that may beneﬁt from added privacy. Among the populations with special needs that seem most appropriate for such private units would be those with communicable diseases and those whose untreated mental health and/ or substance abuse disorders that may disrupt day-to-day shelter operations. Bathrooms in emergency shelters have almost always been designed for shared-use. Dining facilities have also been shared with meal services being incorporated in the program operations. Section 3: The Development Process 29 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The intent of transitional housing, whether for individuals or families, is to establish a safe and secure therapeutic environment where stability may be attained and the process of reintegration into the social mainstream may be achieved. Transitional housing has been developed in a broad range of conﬁgurations, in part because such programs have been developed to serve each homeless sub-population. As a general rule, transitional housing facilities have been developed with greater attention to creating privacy than is found in emergency shelters. Many transitional housing developments allow for private sleeping units (either for individuals or shared by a single family) or have one-half or three-quarter walls and/or partitions to create semi-private living areas in otherwise open spaces. Partitioned accommodations are more frequently found among programs designed for special needs populations, particularly those with serious mental health disorders. Transitional housing programs for individuals typically include common bathroom and dining facilities. This conﬁguration has been less common for families as the conﬁguration can be problematical, compelling families to sacriﬁce their unique identities when placed in institutional settings. Showing greater sensitivity to the need to preserve family identity and integrity as a source of resiliency, over the past decade a number of family providers have increasingly placed homeless families in standard apartment units. Apartment units for homeless families have increasingly been leased in the open market with rental assistance provided by a non-proﬁt organization or a PHA. Families participating in such “housing ﬁrst” programs typically receive a range of supportive services (usually off-site) to stabilize households over a set interval (generally capped at 24-months). Alternatively, families have been housed in unique shelter environments where they reside for prescribed periods. In such settings, supportive social services are generally made available on-site--with ancillary services accessed on a referral basis off-site. Permanent housing and permanent supportive housing for formerly homeless persons has typically followed traditional arrangements found in rental housing developments. Supportive housing is distinguished from standard housing in that it is developed to serve a special-needs population and the management plan includes the availability and integration of supportive social services. Not all persons leaving homelessness may need (or may be interested in obtaining) social services, thus there is a need to develop permanent rental units that are affordable to extremely low-income persons (whether disabled or not). The vast majority of affordable rental housing developed over the past two decades (i.e. since the advent of 30 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY the Low-Income Housing Tax Credit) has been for households at 50 percent and 60 percent AMI. These housing resources have assisted a large number of low-income households achieve social and economic stability. They have not, however, been especially relevant to the life-experiences of persons emerging from homelessness because their extreme poverty keeps even these units out of reach. In order to be relevant to homeless persons, there needs to be some form of rental assistance made available so that persons and households below 30 percent AMI may gain access. A discussion of the role of rental assistance in making housing affordable to homeless persons can be found in a section of this report titled: Rental Assistance and the Difference it Makes. Permanent housing for homeless individuals (whether supportive housing for disabled persons or units for a general population) has typically meant the development of modest private units, either efﬁciency units or single room occupancy. “Single room occupancy” means a small unit (usually between 160 and 500 S.F.) with or without either a private bath or kitchen (but not both). An efﬁciency unit includes both a private bathroom (often ¾ bath) and kitchenette. Single room occupancy is generally inexpensive to develop because of the simplicity of the units and the limited number of bathrooms and kitchens. These accommodations are usually developed from late 19th or early 20th century masonry hotels in most older urban downtowns (especially concentrated near old rail depots), or they are reconﬁgured and modernized motels. Because they tend to use existing structures, the redevelopment potential may be limited by the original building conﬁguration. The advantage of using motels is that they provide superior units with baths included and the rehabilitation process often tends to remove an existing blight in a neighborhood. A disadvantage of motels, however, has been that their original construction has often been found to be sub-standard, thereby necessitating extensive rehabilitation (with limited marginal beneﬁt) compared with new construction. Two overarching considerations that impact the development of any housing for homeless populations are: a) locational amenities, and b) on-site amenities. Location matters in any development endeavor, and this is no less true in homeless housing. One cannot presume that merely because a new resource has been developed, homeless persons will necessarily avail themselves of it. A resource needs to be delivered in a manner that is inviting, meaningful, and accessible. In a dispersed county such as Riverside, transportation from one point to another will remain an ongoing challenge, and this becomes a substantive barrier for Section 3: The Development Process 31 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY homeless populations. A strategy of disbursed housing and social services may ultimately prove to be more effective in moving persons from homelessness to stable housing. This is because a “one-stop” approach with a host of resources “co-located” that may either be remote or otherwise be challenging to access (because of the costs of transportation). What may matter the most to homeless persons (relative to locational amenities) may be access to jobs and appropriate supportive social services, such as beneﬁts, health, and mental health services. The other critical factor that needs to be seriously considered in the development of homeless housing is the amenities to be made available on site. On-site amenities may include physical features, like a laundry, community room (with regular entertainment and socialization activities), computers with internet access, case management ofﬁces, and other design elements to improve the livability of the development. Other amenities may be more therapeutically-based, like 12-Step recovery meetings, case management, socialization, money management, and life-skills training programs. There is considerable debate among homeless services practitioners as to the utility of on-site services. Some providers are of the opinion that there is a therapeutic beneﬁt to having services off-site so that homeless persons more quickly learn how to re-acclimate into the social mainstream as they relearn to negotiate the issues of everyday life, such as getting to appointments on time. Other providers have held that a range of on-site services allows for a high level of supervision that permits social work professionals to make adjustments in client action plans to achieve positive results. As Federal assistance to address homelessness increased in the late 1990s, advocates and local ofﬁcials were increasingly dismayed that the rapid expansion of transitional housing programs and services did little (if anything) to reduce the prevalence of homelessness on the streets of America’s cities. As these grants came up for renewal, it became ever more difﬁcult to convince existing transitional housing grantees of alternate strategies to help persons out of homelessness. However, it became increasingly untenable to expect homeless persons to “graduate” from transitional housing and access market-rate housing. The expansion of transitional housing without a concomitant consideration of the permanent housing needs of persons leaving homelessness has been the most glaring weakness in most community’s strategies to addressing homelessness. 32 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Figure 3A depicts Riverside’s current inventory of homeless shelters and housing and contrasts it with the model described within the 2006 Continuum of Care Plan submitted to HUD. The ﬁgure shows the need for a modest increase in emergency shelter and an enormous expansion of permanent housing resources. The Riverside continuum is not unlike most other continua nationwide in terms of its constituent elements of housing resources. Most continua have a modest supply of emergency shelter units, a large supply of transitional housing, and hardly any permanent housing that is affordable, accessible, and managed so as to be a relevant resource for chronically homeless persons. Figure 3A: Riverside Continuum of Care Components Current Inventory vs. Future Model 1897 2000 Number of Units 1500 1186 Emergency 1120 1000 Transitional 511 Permanent 500 237 354 354 59 273 202 237 59 0 Current Family Current Proposed Proposed Individual Family Individual Data for this chart was obtained from the 2006 Continuum of Care Plan How much transitional housing does a community need? To answer this, one needs to consider: 1) the availability of affordable permanent housing in a community in general and 2) the effectiveness of programs in preparing (formerly) homeless persons for independent living. In a tight rental market with few affordable units, a program participant will be forced to remain “transitionally” housed no matter how effective a program may be in preparing him for permanent housing. Also not to be overlooked is that if a program graduates (say) 100 persons per year, then there need to be at least 50 or so units of permanent housing developed each year just to keep pace with the demand for housing. This analysis assumes that there will be turnover within the permanent units and that not all graduates of transitional housing will seek independent living. This sketch is based on prior experience and is not an empirical study of market demand for permanent and supportive housing, particularly for chronically homeless populations. Section 3: The Development Process 33 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY To return to the question of how much transitional housing a community needs, the answer may well be: as much as needed to ﬁll the new units being developed to capacity and to not keep a person in a transitional housing program any longer than is therapeutically necessary. In practice, most communities have signiﬁcantly over-developed transitional housing as the planning work undertaken during the mid 1990s was suspect and (generally) communities did not appreciate how critical it has been to develop a stock of affordable supportive housing to address the problem of homelessness. Moreover, in most communities the goal has been to “help” the homeless and ameliorate the problem, that is, to provide safe environments where persons could obtain respite from the cold, hard streets. Today the mandate (at least from HUD) seems to be far more ambitious, namely to end chronic homelessness. As this report hopes to elucidate, the development of supportive housing is not for the faint of heart. It involves addressing all of the regular challenges of affordable development, with the added challenges of managing a property with at-risk tenants in need of rental assistance. Whether or not one accepts as realistic the goal of ending chronic homelessness, this has become the guiding principal by which future HUD funding for homeless assistance will be allocated. To lose sight of HUD’s role in this means to risk funding and to become irrelevant to the model of service-delivery that is under development nationwide. For existing programs, this means that if they are not currently focused on chronically homeless populations, they need to plan to do so in the future. The projects that will remain (with some latitude given for other needs among homeless populations) will be those projects that appropriately serve chronically homeless persons and that can demonstrate their efﬁcacy relative to the emerging service-delivery system. Some projects are categorically excluded from this refocusing of HUD homeless assistance: programs for emancipating foster youth, domestic violence shelters, etc. However, to the extent that a program already provides assistance to homeless persons who are disabled by substance abuse or mental health disorders, or that assists persons with developmental disabilities or with chronic health conditions, these programs will need to begin to target more clearly their efforts upon chronically homeless persons. This effort towards systems change will create new opportunities, but seemingly in an increasingly narrow arena: permanent housing (primarily for chronically homeless persons). A number of social service agencies are increasingly becoming involved (either directly or 34 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY indirectly) in permanent housing development or in the administration of rental assistance. Some have created development departments and have hired staff to create new housing; others have sought out Shelter Plus Care and other forms of rental assistance to assist graduates in making the full transition from homelessness to stable housing. Perhaps the most common route to involvement in permanent housing is by partnering with an experienced housing developer who has been induced to serve chronically homeless persons by the availability of supportive services (from the non-proﬁt service provider) and rental assistance. In the preceding discussion there are several references to “appropriate” services for chronically homeless populations. Opinions among homeless providers differ on how best to structure management and case management services, but increasingly it seems as though the pendulum is swinging toward a “housing ﬁrst” approach. Housing ﬁrst tends to involve providing high-tolerance, low-demand permanent housing resources for chronically homeless persons, and to assist them with the social supports they may need to remain stably housed. One housing ﬁrst model that has been employed has been the development of Safe Havens. This approach is contrary to most traditional transitional housing models in which a person is placed in a therapeutic environment for a period of time until he is deemed “housing ready.” Moreover, most transitional housing programs require sobriety as a condition of occupancy. Sobriety is rarely a pre-requisite in “housing ﬁrst” developments where the management entity accepts that it may have to tolerate a certain degree of deviant and even self-destructive behavior. In a “housing ﬁrst” approach, sobriety is a goal to be achieved, not a precondition to shelter. The bottom line question that all providers of such housing have to answer is this: how tolerant does a high-tolerance environment have to be? There is no single right answer to this. So long as public policy is guided by the belief that chronic homelessness largely results from poorly designed programs incapable of addressing the unique needs of long-term homeless persons (rather than the other way around), HUD homeless funding will largely go to support permanent housing in which harm-reduction is the prevailing ethos of service delivery. The pendulum has begun to shift and traditional social service programs are no longer regarded as capable of drawing in, reaching, and reforming chronically homeless persons. Section 3: The Development Process 35 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Most homeless service providers have long recognized the need to aim high with respect to their management practices. Not all agencies have the experience or capacity to implement highly professional management systems. This is unfortunate as housing homeless populations is far more challenging than housing other populations. One additional challenge is that a (formerly) homeless person may need a period of adjustment to become reacquainted to the norms consistent with living in a residential apartment. Such tenants may need assistance in working through landlord-tenant matters or in resolving conﬂicts with neighbors. When one adds to the mix the fact that a large percentage of chronically homeless persons have disabling conditions that hinder their capacity to live independently, it becomes evident that the operation of homeless housing resources is perhaps an even more daunting task than developing such housing in the ﬁrst place. In addition to the difﬁculties in serving a special-needs population, the ﬁnancing of most homeless housing developments (from emergency shelters to permanent supportive housing), necessitates due consideration to the many compliance issues connected with using public resources. The compliance issues are a particularly sensitive point for developments ﬁnanced with Low-income Housing Tax Credits (LIHTC). The LIHTC program provides a private tax beneﬁt to investors who place considerable funds at risk. Over the ﬁrst ﬁfteen years from the date a LIHTC-ﬁnanced development is placed in service, the “initial compliance period,” the investor risks the recapture of its tax beneﬁts should the development not properly document incomes or fail in other respects to maintain the property according to the IRS and TCAC regulations. Public bodies are equally concerned that the developers manage their properties in compliance with the rules, regulations, and the agreements ascribed to the project. The most successful developers who work is intended to assist homeless populations have been those that have followed one of two development strategies. One approach that has proven effective has been to establish partnerships between a nonproﬁt service provider and an experienced affordable housing developer. Some nonproﬁts have partnered with for-proﬁt housing developers, and in Riverside County there is an example of this in the partnership between U.S. Veterans Initiative and the Cantwell-Anderson development corporation. More often, nonproﬁts have joint ventured with nonproﬁt housing developers to create specialized 36 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY new housing stock for homeless persons. Cultivating effective relationships between the non-proﬁt service provider and the developer (whether proﬁt motivated or not) is challenging at best because the expectations of each generally differ in substantive ways, particularly in relationship to management issues. The other approach that has often been used to develop housing resources for homeless populations has been for a nonproﬁt organization to undertake the development work itself. Generally, this latter approach has meant that social service agencies have had to create in-house development capacity. Less commonly, non-proﬁt developers have created social service divisions within their organizations. Whether the development impetus is from a service provider or a housing developer, it is critical that the functions of each are properly addressed so that the project may move forward expeditiously and that attention is paid to the well-being of the residents, the property, and the community. The reason that this section on leverage begins with a discussion of the relationship between service providers and developers is that in general service commitments may be used to leverage housing resources, and vice-versa. Organizations that control resources in each of these domains are at a competitive advantage compared with those that need to work through the time-consuming and uncertain process of negotiating with another entity for support. Both the State and HUD assign critical rating points for applicants for housing dollars that leverage services. The Tax Credit Allocation Committee (TCAC) which administers the Low- income Housing Tax Credit has created a number of set-aside pools that are less competitive than the general pool for special-needs projects and single room occupancy projects that can demonstrate the availability of service commitments. The Supportive Housing Program administered by the California Department of Housing and Community Development similarly assigns points to applications capable of demonstrating leveraged commitments. Commonly, a funding agency will require that its capital resources are matched (on a dollar- for-dollar basis or better) by another form of capital. Match is not to be confused with leveraged resources. The former are required commitments, the latter are resources that help to make an application more competitive relative to others. A common source of match (that may also leverage an application for competitive purposes) has been the Community Development Block Grant (CDBG). While typically a federal source may not serve as a match for other federal funds, HUD regards CDBG funds to be local dollars thereby permitting these funds to be used ﬂexibly for match commitments. Section 3: The Development Process 37 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Experience is another factor that provides a competitive edge in accessing State and federal housing resources. Experience thereby serves as a non-material form of leverage. The LIHTC application for nine percent credits, for example, assigns points on a sliding scale for experience, reaching a maximum for those developers who can demonstrate having completed seven or more projects that have been operational for over 3 years. Another challenge to typical management practices with respect to homeless housing has been to establish and maintain an effective working relationship with the social services provider(s). Even when the management control is within a single organization, the inter- relationship between the housing management and social services divisions may be strained owing to disparate commitments and concerns. A housing division will typically orient itself to those practices that will maintain a property as decent, safe, and sanitary and will provide for the long-term well-being of the physical asset through vigorous maintenance and upkeep. A social service division, in contrast, will focus its attention on the physical and moral well- being of each resident. There are no easy answers as to how these orientations may work through tough tenancy issues when a tenant relapses or otherwise becomes a nuisance to others. Because there are no two days alike when it comes to providing housing and services to homeless persons, no single set of rules and regulations will cover the many varied challenges that a special-needs population may present. Thus it has generally been accepted that ﬂexibility within limits may be the only strategy to employ. Development has been compared to planning for the wedding day; management is more like the marriage itself. “Build it and they will come” seems to have worked in A Field of Dreams. It is a prescription for disaster in the ﬁeld of affordable housing, particularly as related to housing for homeless populations. Development of housing resources for homeless populations depends upon a number of critical elements, each of which needs to be in place for a project to ensue. Firstly, there need to be capital resources to construct the development. Secondly, there needs to be ongoing ﬁnancial support to provide for the myriad of services that homeless persons require to become stabilized and progress in their lives. Thirdly, development requires ongoing operating support as the costs of providing homeless housing resources far outstrip the ability of the client populations to cover with rental payments. In the case of literally homeless 38 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY persons with no reliable means of income, the subsidy needs are extreme; and for persons without any income, the need grows to 100 percent. A somewhat more stabilized homeless population requires marginally less in the way of operating support as this population may be expected to pay rent. To better understand the need for rental assistance, it may be useful to contextualize the current state of housing in the County of Riverside by comparing it with that of the State of California in general. Of the roughly 11 million households in California, nearly 5 million (representing 43 percent) are renters; at 31 percent (approximately 160,000 households), the percentage of renter households in Riverside County is signiﬁcantly lower than the state average largely because the cost of housing has generally been lower than in other parts of the state. As like any other market, income determines both the size and quality of the units that a household can afford. One way to assess the ability of a household to access rental housing is to determine the maximum rent that it can afford. HUD deﬁnes rental housing to be affordable if the household pays no more than 30 percent of its monthly income for rent and utilities. Based upon current income data, the maximum monthly housing costs that a median income household in Riverside County can afford is as follows: 12 California Riverside 100% AMI Annual1 $66,153 $57,500 100% AMI Monthly $5,513 $4,792 30% of AMI2 (housing affordability standard) $19,846 $17,250 AFFORDABLE RENT FOR HH @ 100% AMI $1,654 $1,438 In other words, the average household should be able to afford rents (including utilities) of $1,438 per month. Lower income households can afford signiﬁcantly lower rents as made clear in Table 3A. 1The HUD AMIs are conveniently located at: http://www.efanniemae.com/sf/refmaterials/hudmedinc/ 2 HUD deﬁnes “affordable” rents as a household spending not more than 30 percent of its income on housing costs (rent plus utilities). Section 3: The Development Process 39 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY California Riverside Area Median Monthly Rent Monthly Rent Income Income Income 20% 1,103 $331 $958 $287 30% $1,654 $496 $1,438 $431 40% $2,205 $662 $1,917 $575 50% $2,757 $827 $2,396 $719 60% $3,308 $992 $2,875 $863 80% $4,410 $1,323 $3,834 $1,150 100% $5,513 $1,654 $4,792 $1,438 Table 3B shows that households at 20 percent AMI in Riverside County can “afford” housing costs of $287 per month. To the extent that this household’s rent is greater than $287, it becomes rent burdened thereby putting the tenancy at risk. In other words, as households pay more than 30 percent of their incomes as rent, or sacriﬁce quality by leasing smaller units, to that extent the household becomes at risk of homelessness. Income is only one of two elements that determine affordability. The other consideration is market rent. Rent levels are variable throughout the County of Riverside, but a benchmark is established annually by HUD which establishes “Fair Market Rent” based on ﬁeld surveys of actual rents charged by landlords. In truth the Fair Market Rent (FMR) is something of a hypothetical construct as the standard reduces the multiple markets throughout a jurisdiction to a single “market.” The FMR, however, provides a convenient shortcut by which to assess the overall rent levels by unit-type. Moreover, it nicely summarizes how much money a household would have to come up with on a monthly basis to access a market-rate rental unit. The current FMRs established by HUD for California and Riverside County appear in Table 3C. 40 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY TABLE 3C: 2007 HUD Fair Market Rents (FMR) California Riverside Zero-Bedroom $832 $765 One-Bedroom $972 $835 Two-Bedroom $1,189 $974 Three-Bedroom $1,648 $1,383 Four-Bedroom $1,924 $1,617 The differential between the Fair Market Rents charged by landlords and the maximum rents that a household can afford (based on 30 percent of household income) are summarized in Table 3D for Riverside County. Table 3D demonstrates that even a household at 100 percent AMI (earning a monthly income of $4,792) would be rent-burdened by $179 per month if it sought to lease a 4-bedroom apartment. As incomes decrease, rental units become increasingly unaffordable. What is perhaps most telling is that a household at 60 percent AMI (the HUD deﬁnition of low-income), could reasonably expect to afford only a 0-bedroom or 1-bedroom apartment given market rents. This helps to explain how low-income families often end up in overcrowded conditions. All income levels below 60 percent AMI are rent burdened regardless of the size of the apartment. The rent differentials in Table 3D represent the actual net subsidy amount that the Riverside County Housing Authority must pay to private landlords for units occupied by persons on its rental assistance programs. The differentials show the amount of rental subsidy required at each income level to achieve affordability. HUD FAIR MARKET RENTS Household Maximum 0- 1- 2- 3- 4- Income as Monthly Housing bedroom bedroom bedroom bedroom bedroom % of AMI Income Costs $765 $835 $974 $1,383 $1,617 AFFORDABILITY DIFFERENTIALS 20% $958 $287 ($478) ($548) ($687) ($1,096) ($1,330) 30% $1,438 $431 ($334) ($404) ($543) ($952) ($1,186) 40% $1,917 $575 ($190) ($260) ($399) ($808) ($1,042) 50% $2,396 $719 ($46) ($116) ($255) ($664) ($898) 60% $2,875 $863 $98 $28 ($111) ($520) ($754) 80% $3,834 $1,150 $385 $315 $176 ($233) ($467) 100% $4,792 $1,438 $673 $603 $464 $55 ($179) Section 3: The Development Process 41 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY How is an extremely low-income household lacking rental assistance able to get by? The options are few, but all too common. Some households double-up or triple-up creating an overcrowded condition.3 Other households ﬁnd “housing” in non-standard units like bootleg units, garages, storage facilities, etc. Others, particularly those with substance abuse and/or mental health disabilities often forsake housing altogether and live on the streets, or in shelters. For low-income households, the economic reality is that rents are simply unaffordable. The National Low Income Housing Coalition 2006 Out of Reach report emphasizes that an employee earning minimum wages in Riverside County would have to work 59 hours a week simply to afford the rent of a zero-bedroom unit.4 A minimum wage earner making $6.75 per hour generates monthly income of approximately $1,170. Using the HUD guideline that a renter should pay no more than 30 percent of household income as rent, this means that the affordable rent for a single minimum wage earner is $351 ($1,170 x 30% = $351). To remedy the problem of homelessness it is essential that one appreciates that the common underlying barrier to achieving housing stability is economic instability. From an exclusively economic standpoint, there are only two strategies to improve housing stability for households below 60 percent AMI: 1) increase incomes (through wages, beneﬁts or a combination of the two); or 2) lower housing costs by providing rental assistance subsidies and/or develop new affordable housing with rent-restricted units. A consideration of strategies to increase incomes is beyond the scope of work of this report. The focus here is on solutions to the affordability problem faced by homeless households from the perspective of housing development and rental assistance. The County of Riverside 2004/2005 Homeless Assessment identiﬁed over 2,300 homeless persons without an identiﬁable income source. This means that if headway is to be made in moving this chronically homeless population off of the streets and into normative housing, the resources will have to be identiﬁed to deeply subsidize rents. If in fact no progress could be made in growing incomes (a dire and unlikely but “worst-case” assumption), the annual costs to subsidize all 2,300 persons in 0-bedroom units in the open market would be $21,114,000 ($765 monthly rent x 12 months = $9,180 annual rent x 2,300 homeless persons = $21,114,000). These costs are reduced considerably if a percentage of this population were 3HUD regards overcrowding as more than 1.2 persons per room. 4 National Low Income Housing Coalition, Out of Reach (2006). http://www.nhilc.org/oor/index.cfm 42 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY permanently disabled and therefore eligible for and enrolled in the Supplemental Security Income (SSI) Program.5 SSI is a Federal program with State cost-sharing provisions to assist persons who are permanently disabled and ineligible for Social Security Disability Insurance (SSDI) owing generally to erratic and poor work histories. SSI payments in Southern California are currently $836 per month, which means that a recipient should be capable of affording rent of $251 ($836 x 30% - $251). An SSI recipient with a rental assistance voucher will thus make a tenant payment equivalent to 35 percent of the Fair Market Rent for a 0-bedroom (studio) apartment thereby reducing the net assistance necessary to cover the total rent as per the following analysis: A. Fair Market Rent: $765 100% B. Tenant Income: $836 C. Tenant Rental Payment (B x 30%): $251 33% of rent D. Rental Assistance Payment (A-C): $514 67% of rent In practice this means that as chronically homeless persons become enrolled in the SSI program, they reduce the overall demand and costs of rental assistance. In the unlikely limiting case of 100 percent of the 2,300 chronically homeless persons becoming enrolled in SSI, the cost savings could amount to nearly $7 million annually, reducing the maximum potential subsidy from $21 million to $14 million. HUD regulations permit Public Housing Authorities (PHAs) to establish priorities on their waiting list for a select number of special-needs and other populations, including homeless individuals and households. In fact, HUD Notice PIH 2003-25 (HA) issued October 3, 2003 encourages PHAs to utilize its public housing units and Housing Choice Vouchers for homeless populations.6 The priority may be limited in terms of the number of vouchers and housing units made available through this preference, as well as by establishing conditions 5 The most recent county-level data on the number of SSI recipients shows Riverside with 49,630 eligible persons of whom 26,093 are between the ages of 18 and 64 (the most likely population to be homeless). The total amount of SSI assistance provided to recipients in Riverside County amounted to more than $27 million in FY 2005. (See: U.S. Social Security Administration, Ofﬁce of Policy, SSI Recipients by State and County, 2005 found at http://www.ssa.gov/policy/docs/statecomps/ssi_sc/2005/ca.html. 6 U.S. Department of HUD, Public and Indian Housing, Notice PIH 2003-25 (Homeless Initiative in Public Housing and Housing Choice Voucher Programs), October 3, 2003. Section 3: The Development Process 43 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY like disability status. Given the extremely low-incomes of homeless persons, it is inevitable that some amount of rental assistance will be required to bridge the affordability gap. Following the HUD scandals of the 1980s, Congress prohibited project-basing rental assistance vouchers. As a direct result of this action, the production of “affordable” rental units for households below 50 percent AMI declined. Recognizing that a subsidy source is required to assist very-low and extremely-low income households to remain stable in rental housing, in 2000 Congress reauthorized attaching rental assistance vouchers to speciﬁc projects (as opposed to being used exclusively as tenant-based assistance). In January 2001, HUD provided guidance on how vouchers may be used as project-based assistance, but the regulations were so cumbersome that hardly any Public Housing Authority (PHA) undertook such developments. In October 2005 HUD issued new far more ﬂexible and locally determined procedures for the use of vouchers as project-based assistance (24 CFR Part 983). HUD anticipates that owing to these new regulations roughly 400,000 units may receive voucher assistance. The key provisions of the new regulations are as follows: • A PHA may project-base up to 20 percent of its voucher budget authority • “Existing” housing may be assisted as well as new construction and rehabilitated units • Supportive Housing and other housing for persons with disabilities may be assisted, but transitional housing is prohibited • PHA must use the vouchers in a way consistent with the goal of de-concentrating poverty and expanding opportunity, and the development must allow for a range of incomes o Achieved by limiting project-basing to no more than 25 percent of the units in a building (with certain exceptions) • No limit on the number of tenant-based vouchers or other project-based assistance that may be used in remaining units • Housing must be accessible (under Section 504) for disabled persons • To promote market discipline and provide for individual choice, tenants must be allowed to move after one year (as vouchers become available) 44 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY o The project-based unit retains the original voucher assistance • The initial contract term may be from 1 to 10 years (subject to Section 8 Appropriations) o The contract may be renewed in 5 year increments o Contract may require owner to accept any extensions offered • Owners generally prefer longer-term contracts to allay feasibility concerns that may be raised by investors in developments ﬁnanced with Low-Income Housing Tax Credits. • Rents may be set at 110 percent of Fair Market Rent (or higher with HUD-approval) o Certain technical problems in establishing rents in LIHTC units o Rent in HOME-assisted units may exceed FMR o Rents adjusted annually by PHA based on reasonableness • PHA may target disabled persons with special needs when appropriate services are offered on-site In order to issue project-based vouchers, a PHA must express its intent in its planning documents. Existing plans that may have been submitted to HUD may be amended to include such references following a public hearing (when required). Once a PHA has formally registered its intent to issue project-based vouchers, it needs to allocate such vouchers based in a fair and impartial manner. The PHA is then responsible to ensure compliance in the areas of environment, relocation, workmanship, and ﬁnance. There are many reasons why a PHA may want project-based vouchers. First and foremost, project-basing voucher assistance improves access to housing for certain sub-populations, including (formerly) homeless and disabled persons. Project-basing allows for improved voucher utilization in tight rental markets where existing units may be scarce or landlords are hesitant to lease to persons with voucher assistance. Project-basing allows for development in “opportunity-rich” neighborhoods, thereby allowing for the dispersion of assisted units in higher-income areas. In addition, project-basing encourages new production of affordable units, particularly to the lowest-income households. Another incentive to PHAs to project- based assistance is that it reduces its on-going administrative costs as the program allows for unit inspections based on samples, instead of complete reviews. Section 3: The Development Process 45 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Project-basing vouchers does not provide for a deeper subsidy thereby costing the PHA or HUD additional monies. In fact, it may help to save funds in the long run. The PHA would have to pay a private landlord in the rental market the same level of subsidy with his tenant- based voucher as it would pay for a project-based voucher. Because HUD provides each PHA with a ﬁxed budget, housing authorities are motivated to use their funds in the most cost-effective manner to assist additional households. By working with speciﬁc landlords over time, a PHA is able to better manage cost increases and to anticipate how to absorb adjustments. In the tenant-based program, the PHA is entirely dependent upon market forces, not management capacity. This is not to minimize the administrative burdens of establishing a project-based program. Because PHAs have been outside of production for nearly 20 years, it is likely that existing staff will need to be trained on the program and its implementation. Additionally, project- basing voucher assistance only makes sense if the PHA has conﬁdence that the Section 8 Program will continue to enjoy reauthorization into the future. This is a real matter as over the past few years HUD has altered its policies relative to the number of vouchers each PHA may be entitled to administer. The result of these changes has been to force many PHAs to scale-back their implementation plans (if only marginally). Finally, despite the new regulations that cleared the path for using voucher as project-based assistance, there remain a number of administrative barriers to making the program “user-friendly,” particularly from a development perspective. The HACR has established preferences (consistent with the HUD regulations) targeting assistance to extremely low-income homeless persons and families. The Housing Authority has established the following preferences so that 75 percent of the assistance it delivers goes to households below 30 percent AMI: 1. County of Riverside residency 2. Families who are rent burdened or homeless, 3. Working families with minor or dependent children or elderly families or disabled families Within each preference category, HACR has further prescribed a preference for veterans and/or active duty servicemen and their spouse or survivor. 46 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The Housing Authority has established what appears to be an accessible set of procedures to place persons on its waiting list. Among the registration methods it employs are: telephone enrollment (as a reasonable accommodation for disabled persons), mail, fax, and in-person delivery. The waiting list was last opened on June 1, 2006 and remains open. Through December 31, 2006, the enrollment process resulted in 9,513 requests of which 7,829 were new applicants (the balance being prior registrants whose applications were withdrawn for one reason or another). The waiting list now numbers over 25,000 households. The registration form itself is available as a download from its website (http://www.harivco. org). In addition, the website provides generally clear information to prospective registrants as to the eligibility criteria and the administration of the waiting list (especially as regards preferences). In any given year, the Housing Authority assists roughly 1,000 new households, meaning that over 20 potentially eligible households will have to wait many years in order to obtain rental assistance.7 The Housing Authority allows for the use of project-based assistance in those parts of the county where there are low voucher utilization rates. The intent of project-basing vouchers is to alleviate the concentration of poverty. Because the actual utilization of voucher assistance exceeds the Housing Authority’s annual allotment, project-basing assistance has not been possible in practice. All development requires a feasible ﬁnance plan that takes into account available sources and their eligible uses. Some sources, the Low-income Housing Tax Credit, for example, are extremely ﬂexible with respect to the timing and uses for which (equity) funds may be used. Other sources are far more restrictive, like the Multifamily Housing Program that may only be used as permanent ﬁnancing. There is no such thing as a single ﬁnance model that may be applied to all developments. That is because the availability of funds is variable and a large number of key sources are allocated on a competitive basis that takes into account matters such as the experience of the developer, the location of the project, and the resident population. Financial planning involves the development of a number of budgets and projections: 7Information on the management of the waiting list was provided by Ms. Heidi Marshall of the Riverside County EDA. Section 3: The Development Process 47 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • Development Budget: Showing the total costs to complete construction and support the project through stabilization (generally at 95 percent occupancy). • Sources and Uses: Being a summary of the available public and private resources and costs at different stages of development: o Acquisition o Pre-development o Construction o Permanent ﬁnancing • Allocation Plan: Being a summary of how the permanent sources will be allocated taking into consideration the restrictions on eligible uses. • Income Schedule: In order to comply with various funding sources and to be competitive for funding, rents are restricted to be affordable at different income levels. In order to determine how much cash will be available to cover operations and incur debt (if any), it is essential to understand the various restrictions on tenancy (including income, status relative to homelessness, and disability status). To the extent that rental assistance is proposed to be attached to the development, it must also be identiﬁed and budgeted. The gross potential income is then reduced by a percentage to account for vacancies caused by unit turnover. The majority of underwriters require developments serving homeless populations to include a vacancy factor of 10 percent. The vacancy factor for most other affordable housing is ﬁve percent (or an actual rate ﬁxed by an independent third party market analyst). • Operating Expense Schedules: A budget based on developments of comparable size, age, and tenant population must also be created. In general, this budget would be independent of the supportive social services budget, but some capital sources permit a modest level of service coordination to be included among the eligible expenses. Sample operating budgets with stafﬁng plans for emergency shelter, transitional housing and supportive housing follow. • Reserve Balance Schedule: A budget must also be prepared showing the projected balances of the following reserves: o Capital Replacement Reserve: For acquisition / rehabilitation projects, a Physical Needs Assessment will have to be conducted that takes into account the existing condition of 48 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY the building, its age, the proposed scope of improvements, and the remaining useful life of the building systems. The replacement costs must then be adjusted to account for inﬂation so that it can be determined how much cash must be deposited annually into the replacement reserve. o Operating Reserve: Standards vary on this, but in general public agencies require a reserve to be capitalized and included in the development budget. The initial reserve is typically equal to 3 to 4 months of expenses, including debt service. In addition, an annual contribution to the operating reserve must also be included in the development budget. o Rental Assistance Reserve: Over the past several years as concerns have been raised as to whether the Section 8 (and other HUD rental assistance programs) will be sustained, it has become increasingly important for projects with rental assistance to include a reserve budget to be drawn upon in the event that the Housing Assistance Payments contract is not renewed. o Supportive Social Services Reserve: To the extent that there may be a need to guarantee a commitment of social services, it may be necessary to include a reserve account in the overall capital development budget. • Supportive Social Services: It has often been the case that grants and/or contracts to cover the costs of social services have been among the most difﬁcult resources to obtain for developers of housing for homeless persons. One reason for this has been that most service agreements are appropriated annually, but (recognizing the need for a range of appropriate services) public bodies allocating funds for housing development require long-term service commitments before investing in homeless housing. In general only a modest level of services may be included in a project’s operating budget. There is tremendous variation across the landscape regarding how much to budget for social services as it is hard to assess both the range and quality of services from one program site to another. Moreover, even if benchmarks are established by a program, there is no way to prejudge the level of acuity and capacity of disabled homeless persons to live independently. For example, a transitional housing program for persons with mental health disorders may operate relatively smoothly if it has a high percentage of residents with schizophrenia taking their psychotropic medications. To introduce to this community a number of persons with Type II personality disorders may create a number of challenges that could occupy a large percentage of the staff’s time to monitor and regulate thereby impacting the overall level Section 3: The Development Process 49 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY of service. The following case management ratios have been used as a guide for budget purposes: Case Loads Program Type High Medium Low Emergency Shelter for Individuals 60 40 25 Emergency Shelter for Families (per family) 40 30 20 Transitional Housing for Families (per family) 30 20 15 Transitional Housing for Disabled Persons 40 25 20 Safe Haven 40 30 20 Permanent Supportive Housing 50 40 30 Permanent Housing 80 60 40 The chart above references case management services (which may be assumed to include ancillary services such as money management, medication monitoring, and the like), but it does not include other services that may be available to homeless clients. Among the other services that may be offered on-site and would thereby have to be considered for budgetary purposes are: • Childcare • Compensated work therapy (i.e., stipends to clients for on-site labor like food handling) • Dental care • Educational services • Employment assistance (assessment, job training, and job search assistance) • Food services • Legal assistance (including beneﬁts advocacy, especially for SSI eligibility) • Life-skills training • Medical care (including psychiatry) • Medication management • Money Management • Outreach and intake services 50 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • Socialization services • Substance abuse counseling • Transportation To the extent that these services are to be offered off-site by community partners, agreements would have to be negotiated between the developer and the service providers conﬁrming the availability of such resources for the proposed tenant populations. These agreements are required by the predominant state and federal agencies allocating capital for housing production. The preparation of speciﬁc budgets for these services is outside of the scope of this report, but for analytical purposes, the study assumes a moderate level of services as follows: Assumed Case Management Caseloads for Budget Purposes (for Sample Budgets) Emergency Transitional Housing Permanent Supportive Service Shelter Housing Supportive Housing 1 FTE per 40 20 30 The operating budgets that appear on the following tables show a range of costs depending on the size of the shelter, its design, and whether or not it is used for emergency or transitional housing purposes. The budgets were developed using locally available information, but clearly some variation is to be expected as no two programs operate identically. The budgets presented here assume the following: that case management and food services are available, as well as a range of other services (like transportation). Housing and social expenses have been segregated so that better comparisons may be made across programs. Case management services have been assumed on a ratio of one case manager for every 40 program participants for emergency shelter and one case manager for every 20 participants or families for transitional housing. The lower caseload for transitional housing programs has been assumed based on the fact that most programs are targeted to homeless families or severely disabled persons—each population requiring a substantial amount of attention. The caseload for permanent supportive housing has been assumed as being on a 30:1 ratio. In addition to case management services, each budget assumes a number of additional costs for the delivery of supportive social services (e.g., telephone, ofﬁce). Section 3: The Development Process 51 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Sample Operating Budget Emergency Shelter BEDS / COTS SRO Units 20 40 80 40 % FTE Salary % FTE Salary % FTE Salary % FTE Salary PERSONNEL Base Operations Salary Shelter Manager $34,000 100% $34,000 100% $34,000 100% $34,000 100% $34,000 Assistant Manager $28,000 50% $14,000 100% $28,000 50% $14,000 Night Shift / Desk Clerks $19,000 120% $22,800 20% $22,800 220% $41,800 300% $57,000 Maintenance $24,000 25% $6,000 50% $12,000 50% $12,000 50% $12,000 Janitorial $18,000 50% $9,000 100% $18,000 125% $22,500 100% $18,000 Security $18,500 100% $18,500 150% $27,750 200% $37,000 100% $18,500 Food Services $16,000 100% $16,000 150% $24,000 200% $32,000 150% $24,000 Total Operations Personnel 4.95 $106,300 7.20 $152,550 9.95 $207,300 8.50 $177,500 Social Services Program Assistance $24,000 25% $6,000 50% $12,000 100% $24,000 50% $12,000 Case Management $34,000 50% $17,000 100% $34,000 200% $68,000 100% $34,000 Program Management $40,000 25% $10,000 50% $20,000 100% $40,000 50% $20,000 Total Soc. Service Personnel 1.00 $33,000 2.00 $66,000 4.00 $132,000 2.00 $66,000 Total Salary/Wages $139,300 $218,550 $339,300 $243,500 Benefits/Fringe/PR Taxes 25% $34,825 $54,638 $84,825 $60,875 TOTAL PERSONNEL 5.95 $174,125 9.20 $218,550 13.95 $424,125 10.50 $304,375 Other Per Bed 1. Maintenance/Repair $300 $6,000 $12,000 $24,000 $12,000 2. Utilities $300 $6,000 $12,000 $24,000 $12,000 3. Equipment $60 $1,200 $2,400 $4,800 $2,400 4. Supplies $125 $2,500 $5,000 $10,000 $5,000 5. Insurance $200 $4,000 $8,000 $16,000 $8,000 6. Furnishings (quantity) $300 $6,000 $12,000 $24,000 $12,000 7. Food $1,600 $32,000 $64,000 $128,000 $64,000 8. Pest Control $75 $1,500 $3,000 $6,000 $3,000 9. Linens, Uniforms $125 $2,500 $5,000 $10,000 $5,000 10. Other Soc. Services $600 $12,000 $24,000 $48,000 $24,000 Total Other $73,700 $147,400 $294,800 $147,400 Total Direct Expenses $247,825 $365,950 $718,925 $451,775 Administration / Overhead 15% $37,174 $54,893 $107,839 $67,766 Total Program Expenses $284,999 $420,843 $826,764 $519,541 Cost per Bed/Unit/Annual $14,250 $10,521 $10,335 $12,989 Cost per Bed/Unit/Daily $39.04 $28.82 $28.31 $35.59 Staff to Participant Ratio 3.4 4.3 5.7 3.8 52 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Sample Operating Budget Transitional Housing BEDS / COTS SRO Units 20 40 60 40 % FTE Salary % FTE Salary % FTE Salary % FTE Salary PERSONNEL Base Operations Salary Shelter Manager $ 34,000 100% $ 34,000 100% $ 34,000 100% $ 34,000 100% $ 34,000 Assistant Manager $ 28,000 50% $ 14,000 50% $ 14,000 50% $ 14,000 Night Shift / Desk Clerks $ 19,000 120% $ 22,800 120% $ 22,800 120% $ 22,800 120% $ 22,800 Maintenance $ 24,000 25% $ 6,000 50% $ 12,000 50% $ 12,000 50% $ 12,000 Janitorial $ 18,000 50% $ 9,000 100% $ 18,000 125% $ 22,500 100% $ 18,000 Security $ 18,500 100% $ 18,500 150% $ 27,750 200% $ 37,000 100% $ 18,500 Food Services $ 16,000 100% $ 16,000 150% $ 24,000 200% $ 32,000 150% $ 24,000 Total Operations Personnel 4.95 $106,300 7.20 $152,550 8.45 $174,300 6.70 $143,300 Social Services Program Assistance $ 24,000 50% $ 12,000 100% $ 24,000 125% $ 30,000 100% $ 24,000 Case Management $ 34,000 100% $ 34,000 200% $ 68,000 300% $102,000 200% $ 68,000 Program Management $ 40,000 50% $ 20,000 100% $ 40,000 100% $ 40,000 100% $ 40,000 Total Social Service Personnel 2.00 $66,000 4.00 $132,000 5.25 $172,000 4.00 $132,000 Total Salary/Wages $172,300 $284,550 $346,300 $275,300 Benefits/Fringe/PR Taxes 25% $ 43,075 $ 71,138 $ 86,575 $ 68,825 TOTAL PERSONNEL 6.95 $215,375 11.20 $284,550 13.70 $432,875 10.70 $344,125 Other Per Bed 1. Maintenance/Repair $300 $ 6,000 $ 12,000 $ 18,000 $ 12,000 2. Utilities $300 $ 6,000 $ 12,000 $ 18,000 $ 12,000 3. Equipment $60 $ 1,200 $ 2,400 $ 3,600 $ 2,400 4. Supplies $125 $ 2,500 $ 5,000 $ 7,500 $ 5,000 5. Insurance $200 $ 4,000 $ 8,000 $ 12,000 $ 8,000 6. Furnishings (quantity) $300 $ 6,000 $ 12,000 $ 18,000 $ 12,000 7. Food $ 1,600 $ 32,000 $ 64,000 $ 96,000 $ 64,000 8. Pest Control $75 $ 1,500 $ 3,000 $ 4,500 $ 3,000 9. Linens, Uniforms $125 $ 2,500 $ 5,000 $ 7,500 $ 5,000 10. Other Social Services $600 $ 12,000 $ 24,000 $ 36,000 $ 24,000 Total Other $ 73,700 $147,400 $221,100 $147,400 Total Direct Expenses $289,075 $431,950 $653,975 $491,525 Administration / Overhead 15% $ 43,361 $ 64,793 $ 98,096 $ 73,729 TOTAL PROGRAM EXPENSES $332,436 $496,743 $752,071 $565,254 Cost per Bed/Unit/Annual $ 16,622 $ 12,419 $ 12,535 $ 14,131 Cost per Bed/Unit/Month $ 1,385 $ 1,035 $ 1,045 $ 1,178 Staff to Participant Ratio 2.9 3.6 4.4 3.7 Section 3: The Development Process 53 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Sample Operating Budgets Supportive Housing (excludes food services) SRO UNITS SRO UNITS SRO UNITS Efficiency Units 20 40 60 50 % FTE Salary % FTE Salary % FTE Salary % FTE Salary PERSONNEL Operations Base Salary Resident Manager $34,000 100% $34,000 100% $34,000 100% $34,000 100% $34,000 Assistant Manager $28,000 50% $14,00 50% $14,000 50% $14,000 Maintenance $24,000 25% $6,000 50% $12,000 75% $18,000 50% $12,000 Janitorial $18,000 50% $9,000 100% $18,000 100% $18,000 50% $9,000 Security $18,500 50% $9,250 100% $18,500 100% $18,500 100% $18,500 Total Operations Personnel 2.25 $58,250 4.00 $96,500 4.25 $102,500 3.50 $87,500 Social Services Program Assistance $24,000 25% $6,000 50% $12,000 75% $18,000 50% $12,000 Case Management $34,000 50% $17,000 100% $34,000 150% $51,000 100% $34,000 Program Management $40,000 25% $10,000 50% $20,000 75% $30,000 50% $20,000 Total Soc. Service Personnel 1.00 $33,000 2.00 $66,000 3.00 $99,000 2.00 $66,000 Total Salary/Wages $91,250 $162,500 $201,500 $153,500 Benefits/Fringe/PR Taxes 25% $22,813 $40,625 $50,375 $38,375 TOTAL PERSONNEL 3.25 $114,063 6.00 $203,125 7.25 $251,875 5.50 $191,875 Other Per Unit 1. Maintenance/Repair $ 300 $6,000 $12,000 $18,000 $15,000 2. Utilities $ 300 $6,000 $12,000 $18,000 $15,000 3. Equipment $ 60 $1,200 $2,400 $3,600 $3,000 4. Supplies $ 125 $2,500 $5,000 $7,500 $6,250 5. Insurance $ 200 $4,000 $8,000 $12,000 $10,000 6. Furnishings (quantity) $ 300 $6,000 $12,000 $18,000 $15,000 7. Food 8. Pest Control $ 75 $1,500 $3,000 $4,500 $3,750 9. Linens, Uniforms $ 125 $2,500 $5,000 $7,500 $6,250 10. Other Social Services $ 200 $4,000 $8,000 $12,000 $10,000 Total Other $33,700 $67,400 $101,100 $84,250 TOTAL DIRECT EXPENSES $147,763 $270,525 $352,975 $276,125 Administration / Overhead 15% $22,164 $40,579 $52,946 $41,419 TOTAL PROGRAM EXPENSES $169,927 $311,104 $405,921 $317,544 Cost per Bed/Unit/Annual $8,496 $7,778 $6,765 $6,351 Cost per Bed/Unit/Month $ 708 $ 648 $ 564 $ 529 Staff to Participant Ratio 6.2 6.7 8.3 9.1 54 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • Cash-ﬂow Projection: Public and private investors are not only interested in whether the funds can be assembled to construct a new development but also they need to feel conﬁdent that such investment will be protected through time. Accordingly, every development budget includes a cash-ﬂow projection (generally of 15 years) that takes into account the project’s income and expenses when adjusted for inﬂation. Because it is generally assumed that there will be a bank-ﬁnanced ﬁrst trust deed on a development, it is important to demonstrate to a private lender that the project will generate sufﬁcient cash to amortize the proposed debt. It should be noted that most homeless housing does not include private debt as a permanent source owing to the modest incomes generated by the tenants. The level of private debt that may be placed on a development is a factor of the Net Operating Income (income less expenses and reserve contributions). Private lenders will typically ﬁnance a loan up to 85 percent of the ﬁrst year Net Operating Income (a debt service ratio of 1.15). Larger loans may be possible with mortgage insurance (e.g. FHA or CalFHA). The sample cash ﬂow projections that follow assume that there is no permanent serviceable debt on the development owing to the diminishing net operating income. It is highly unusual in any event for an emergency shelter or transitional housing program to incur debt, as there is no certainty from one year to the next as to the sources available to cover operations. In a permanent housing development with a dedicated source of rental assistance, it may be possible to incur a small (residual) amount of debt. The cash ﬂow projection for the permanent supportive housing model that follows assumes the availability of 40 Shelter Plus Care rental assistance certiﬁcates. It should be noted that even with this subsidy, the project trends downward and begins to run at a negative cash ﬂow in year 10 despite the fact that the model does not assume any serviceable debt. Section 3: The Development Process 55 56 Sample Cash Flow Projections: Emergency Annual Rate of Increase 40-bed Program Rental Income: 102.5% Expenses: 103.5% YEAR 1 2 3 4 5 6 7 8 9 10 Expenses Total Operations Personnel $152,550 $157,889 $163,415 $169,135 $175,055 $181,182 $187,523 $194,086 $200,879 $207,910 Total Social Service Personnel $66,000 $68,310 $70,701 $73,175 $75,737 $78,387 $81,131 $83,970 $86,909 $89,951 Total Salary/Wages $218,550 $226,199 $234,116 $242,310 $250,791 $259,569 $268,654 $278,057 $287,789 $297,861 Benefits/Fringe/PR Taxes $54,638 $56,550 $58,529 $60,578 $62,698 $64,892 $67,163 $69,514 $71,947 $74,465 Total Personnel $273,188 $282,749 $292,645 $302,888 $313,489 $324,461 $335,817 $347,571 $359,736 $372,327 Total Other $147,400 $152,559 $157,899 $163,425 $169,145 $175,065 $181,192 $187,534 $194,098 $200,891 Total Direct Expenses $420,588 $435,308 $450,544 $466,313 $482,634 $499,526 $517,009 $535,105 $553,833 $573,218 Administration / Overhead $63,088 $63,088 $63,088 $63,088 $63,088 $63,088 $63,088 $63,088 $63,088 $63,088 TOTAL PROGRAM EXPENSES $483,676 $498,396 $513,632 $529,401 $545,722 $562,614 $580,098 $598,193 $616,922 $636,306 Required Operating Subsidy $483,676 $498,396 $513,632 $529,401 $545,722 $562,614 $580,098 $598,193 $616,922 $636,306 Cost per Bed/Unit/Annual $12,092 $12,460 $12,841 $13,235 $13,643 $14,065 $14,502 $14,955 $15,423 $15,908 Cost per Bed/Unit/Day $33.13 $34.14 $35.18 $36.26 $37.38 $38.54 $39.73 $40.97 $42.25 $43.58 Five Year Subsidy Need: $2,570,827 Ten Year Subsidy Need: $5,564,959 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Sample Cash Flow Projections: Transitional Housing Annual Rate of Increase 40-bed Program Rental Income: 102.5% Expenses: 103.5% Section 3: The Development Process YEAR 1 2 3 4 5 6 7 8 9 1 Total Rental Revenue $105,600 $108,240 $110,946 $113,720 $116,563 $119,477 $122,464 $125,525 $128,663 $131,880 Vacancy Loss -$10,560 -$10,824 -$11,095 -$11,372 -$11,656 -$11,948 -$12,246 -$12,553 -$12,866 -$13,188 Effective Gross Income $95,040 $97,416 $99,851 $102,348 $104,906 $107,529 $110,217 $112,973 $115,797 $118,692 Expenses Total Operations Personnel $152,550 $157,889 $163,415 $169,135 $175,055 $181,182 $187,523 $194,086 $200,879 $207,910 Total Social Service Personnel $132,000 $136,620 $141,402 $146,351 $151,473 $156,775 $162,262 $167,941 $173,819 $179,902 Total Salary/Wages $284,550 $294,509 $304,817 $315,486 $326,528 $337,956 $349,785 $362,027 $374,698 $387,812 Benefits/Fringe/PR Taxes $71,138 $73,627 $76,204 $78,871 $81,632 $84,489 $87,446 $90,507 $93,675 $96,953 Total Personnel $355,688 $368,137 $381,021 $394,357 $408,160 $422,445 $437,231 $452,534 $468,373 $484,766 Total Other $147,400 $152,559 $157,899 $163,425 $169,145 $175,065 $181,192 $187,534 $194,098 $200,891 Total Direct Expenses $503,088 $520,696 $538,920 $557,782 $577,304 $597,510 $618,423 $640,068 $662,470 $685,657 Administration / Overhead $75,463 $75,463 $75,463 $75,463 $75,463 $75,463 $75,463 $75,463 $75,463 $75,463 TOTAL PROGRAM EXPENSES $578,551 $596,159 $614,383 $633,245 $652,768 $672,973 $693,886 $715,531 $737,933 $761,120 Required Operating Subsidy $483,511 $498,743 $514,532 $530,898 $547,861 $565,444 $583,669 $602,558 $622,136 $642,428 Cost per Bed/Unit/Annual $14,464 $14,904 $15,360 $15,831 $16,319 $16,824 $17,347 $17,888 $18,448 $19,028 Cost per Bed/Unit/Month $1,205 $1,242 $1,280 $1,319 $1,360 $1,402 $1,446 $1,491 $1,537 $1,586 Five Year Subsidy Need: $2,575,544 Ten Year Subsidy Need: $5,591,779 57 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 58 Permanent Supportive Housing Cash Flow Analysis Annual Rate of Increase Participants: 50 @ 30% AMI Rental Income: 102.5% 40 Residents with S+C Subsidy Expenses 103.0% YEAR 1 2 3 4 5 6 7 8 9 10 Revenues Tenant Rent 181,200 185,730 190,373 195,133 200,011 205,011 210,136 215,390 220,775 226,294 Rental Assistance 40 112,320 115,128 118,006 120,956 123,980 127,080 130,257 133,513 136,851 140,272 (Shelter + Care) Laundry/Other 1,800 1,845 1,891 1,938 1,987 2,037 2,087 2,140 2,193 2,248 Gross Potential Income 295,320 302,703 310,271 318,027 325,978 334,127 342,481 351,043 359,819 368,814 Vacancy Loss 10% (29,532) (30,270) (31,027) (31,803) (32,598) (33,413) (34,248) (35,104) (35,982) (36,881) Net Income 265,788 272,433 279,244 286,225 293,380 300,715 308,233 315,938 323,837 331,933 Expenses Total Direct Expenses–Housing 183,625 189,134 194,808 200,652 206,672 212,872 219,258 225,836 232,611 239,589 Total Reserves 45,000 46,350 47,741 49,173 50,648 52,167 53,732 55,344 57,005 58,715 TOTAL OPERATING EXPENSES 228,625 235,484 242,548 249,825 257,319 265,039 272,990 281,180 289,615 298,304 NET OPERATING INCOME 37,163 36,949 36,695 36,400 36,061 35,676 35,242 34,758 34,222 33,629 Social Services SOCIAL SERVICES EXP. 92,500 94,813 97,183 99,612 102,103 104,655 107,272 109,953 112,702 115,520 NET SOCIAL SERVICE GAP* ($55,337) ($57,864) ($60,488) ($63,212) ($66,042) ($68,980) ($72,029) ($75,195) ($78,481) ($81,891) * Social service costs not covered by operating revenues and requiring additional subsidy from an external source. Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Development costs vary widely because no two projects are identical. A general range of average costs can be created to help in the creation of long-term budgets. Among the key variables that tend to introduce variability in development budgets are: acquisition costs, design standards, scale of development, reserve requirements, and impact fees. Land costs in urban centers are far higher than in outlying areas (in general). In addition to the costs of acquiring a parcel or building, an acquisition budget may also need to include relocation and holding costs. The scale of a development also has a direct bearing on per unit costs as larger projects are able to allocate ﬁxed costs over a larger denominator thereby lowering per unit costs. Depending on whether private units or a congregate shelter is being proposed also impacts a development budget. A general range of development costs can be prepared, but each proposed new project has to be looked at in terms of the reasonableness of the development budget in light of local design standards, land costs, etc. For the purposes of the analysis included in this report, four development budgets have been prepared. The ﬁrst budget is for a congregate shelter with 40 cots in an open space with half- wall built-in partitions. The assumption is that the shelter would be developed by converting an existing commercial property. The second budget is for a new construction transitional housing development for individuals, also conﬁgured as a congregate shelter. The third budget is for transitional housing for families comprised of private one-bedroom units. The ﬁnal capital budget is for a proposed new construction of 50 efﬁciency units for disabled homeless persons. Efforts have been made to conﬁrm the cost estimates, but in the end these budgets are merely models and a speciﬁc budget will need to be created for any project to be proposed. Section 3: The Development Process 59 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Emergency Shelter Units 40 Acquisition / Rehabilitation Shelter Size 20,000 Lot Size 16,000 TOTAL PROJECT COST PER UNIT LAND COST/ACQUISITION Per S/F Land Cost or Value $300,000 $7,500 Demolition $120,000 $1,500 Legal $12,000 $300 Total Land Cost or Value $432,000 $9,300 Existing Improvements Value $550,000 $13,750 Off-Site Improvements $40,000 $1,000 Total Acquisition Cost $51.10 $1,022,000 $24,050 REHABILITATION Site Work $7.81 $125,000 $3,125 Structures $87.50 $1,750,000 $43,750 General Requirements $6.14 $122,850 $3,071 Contractor Overhead $2.17 $43,407 $1,085 Contractor Profit $6.64 $132,825 $3,321 Prevailing Wages $14.88 $297,500 $7,438 General Liability Insurance $2.10 $42,000 $1,050 Total Construction Costs $127.24 $2,513,582 $62,840 ARCHITECTURAL FEES Design $9.00 $180,000 $4,500 Supervision $2.10 $42,000 $1,050 Total Architectural Costs $11.10 $222,000 $5,550 Total Survey and Engineering $5.50 $110,000 $2,750 CONST. INTEREST & FEES Taxes $0.35 $7,000 $175 Insurance & Bond $1.95 $39,000 $975 Total Const. Interest & Fees $2.30 $46,000 $1,150 PERMANENT FINANCING Title and Recording $0.63 $12,500 $313 Total Perm. Financing Costs $0.63 $12,500 $313 LEGAL FEES Lender Legal Pd. By Applicant $1.60 $32,000 $800 Total Attorney Costs $1.60 $32,000 $800 RESERVES Replacement Reserve $5.00 $100,000 $2,500 3 Month Operating Reserve $3.84 $76,840 $1,921 Total Reserve Costs $8.84 $176,840 $4,421 APPRAISAL COSTS $0.35 $7,000 $175 OTHER Environmental Audit $0.60 $12,000 $300 Local Dev. Impact Fees $4.00 $80,000 $2,000 Permit Processing Fees $1.00 $20,000 $500 Furnishings $13.00 $260,000 $6,500 Total Other Costs $18.60 $372,000 $9,300 Subtotals $227.26 $4,513,922 $111,348 DEVELOPER COSTS Consultant/Processing Agent $3.75 $75,000 $1,875 Project Administration $1.30 $26,000 $650 Construction Management by Developer $1.80 $36,000 $900 Other: security $3.00 $60,000 $1,500 Total Developer Costs $9.85 $197,000 $4,925 TOTAL PROJECT COST $237.11 $4,710,922 $116,273 60 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Transitional Housing Units 40 New Construction for Individuals Shelter Size 20,000 Lot Size 16,000 TOTAL PROJECT COST PER UNIT LAND COST/ACQUISITION Per S/F Land Cost or Value $300,000 $7,500 Demolition $120,000 $1,500 Legal $12,000 $300 Total Land Cost or Value $432,000 $9,300 Existing Improvements Value $450,000 $11,250 Off-Site Improvements $40,000 $1,000 Total Acquisition Cost $46.10 $922,000 $21,550 NEW CONSTRUCTION Site Work $7.81 $125,000 $3,125 Structures $140.00 $2,800,000 $60,000 General Requirements $8.42 $168,480 $4,212 Contractor Overhead $2.98 $59,530 $1,488 Contractor Profit $9.11 $182,161 $4,554 Prevailing Wages $20.40 $408,000 $10,200 General Liability Insurance $2.10 $42,000 $1,050 Total Construction Costs $170.82 $3,785,170 $84,629 ARCHITECTURAL FEES Design $9.00 $180,000 $4,500 Supervision $2.10 $42,000 $1,050 Total Architectural Costs $11.10 $222,000 $5,550 Total Survey and Engineering $5.50 $110,000 $2,750 CONST. INTEREST & FEES Taxes $0.35 $7,000 $175 Insurance & Bond $1.95 $39,000 $975 Total Const. Interest & Fees $2.30 $46,000 $1,150 PERMANENT FINANCING Title and Recording $0.63 $12,500 $313 Total Perm. Financing Costs $0.63 $12,500 $313 LEGAL FEES Lender Legal Pd. By Applicant $1.60 $32,000 $800 Total Attorney Costs $1.60 $32,000 $800 RESERVES Replacement Reserve $5.00 $100,000 $2,500 3 Month Operating Reserve $3.84 $76,840 $1,921 Total Reserve Costs $8.84 $176,840 $4,421 APPRAISAL COSTS $0.35 $7,000 $175 OTHER Environmental Audit $0.60 $12,000 $300 Local Dev. Impact Fees $24.00 $480,000 $12,000 Permit Processing Fees $1.00 $20,000 $500 Furnishings $13.00 $260,000 $6,500 Total Other Costs $38.60 $772,000 $19,300 Subtotals $305.84 $6,085,510 $140,638 DEVELOPER COSTS Consultant/Processing Agent $3.75 $75,000 $1,875 Project Administration $1.30 $26,000 $650 Const. Management by Developer $1.80 $36,000 $900 Other: security $3.00 $60,000 $1,500 Total Developer Costs $9.85 $197,000 $4,925 TOTAL PROJECT COST $315.69 $6,222,510 $155,563 Section 3: The Development Process 61 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Transitional Housing Units 40 New Construction for Families Shelter Size 30,000 Lot Size 20,000 TOTAL PROJECT COST PER UNIT LAND COST/ACQUISITION Per S/F Land Cost or Value $300,000 $7,500 Demolition $120,000 $3,000 Legal $12,000 $300 Total Land Cost or Value $432,000 $9,300 Existing Improvements Value $450,000 $11,250 Off-Site Improvements $40,000 $1,000 Total Acquisition Cost $30.73 $922,000 $23,050 NEW CONSTRUCTION Site Work $6.25 $125,000 $3,125 Structures $160.00 $4,800,000 $120,000 General Requirements $11.23 $336,960 $8,424 Contractor Overhead $3.97 $119,059 $2,976 Contractor Profit $12.14 $364,321 $9,108 Prevailing Wages $27.20 $816,000 $20,400 General Liability Insurance $1.40 $42,000 $1,050 Total Construction Costs $222.19 $6,603,340 $165,084 ARCHITECTURAL FEES Design $6.00 $180,000 $4,500 Supervision $1.40 $42,000 $1,050 Total Architectural Costs $7.40 $222,000 $5,550 Total Survey and Engineering $3.67 $110,000 $2,750 CONST. INTEREST & FEES Const. Loan Interest $8.67 $260,000 $6,500 Origination Fee $0.80 $24,000 $600 Taxes $0.23 $7,000 $175 Insurance & Bond $1.30 $39,000 $975 Title and Recording $0.53 $16,000 $400 Total Const. Interest & Fees $2.87 $346,000 $8,650 PERMANENT FINANCING Title and Recording $0.42 $12,500 $313 Total Perm. Financing Costs $0.42 $12,500 $313 LEGAL FEES Lender Legal Pd. By Applicant $1.07 $32,000 $800 Other: Partnership $0.80 $24,000 $600 Total Attorney Costs $1.87 $56,000 $1,400 RESERVES Replacement Reserve $3.33 $100,000 $2,500 3 Month Operating Reserve $2.56 $76,840 $1,921 Total Reserve Costs $5.89 $176,840 $4,421 TOTAL APPRAISAL COSTS $0.23 $7,000 $175 OTHER TCAC App/Alloc/Monitor Fees $0.90 $27,000 $675 Environmental Audit $0.40 $12,000 $300 Local Dev. Impact Fees $16.00 $480,000 $12,000 Permit Processing Fees $0.67 $20,000 $500 Capital Fees $0.40 $12,000 $300 Marketing $0.27 $8,000 $200 Furnishings $8.67 $260,000 $6,500 Market Study $0.40 $12,000 $300 Total Other Costs $26.80 $831,000 $20,775 Subtotals $302.07 $9,286,680 $232,167 DEVELOPER COSTS Developer Overhead/Profit $28.33 $850,000 $21,250 Consultant/Processing Agent $2.50 $75,000 $1,875 Project Administration $0.87 $26,000 $650 Const. Mngmt. Oversight by Dev. $1.20 $36,000 $900 Other: security $2.00 $60,000 $1,500 Total Developer Costs $34.90 $1,047,000 $26,175 TOTAL PROJECT COST $336.97 $10,333,680 $258,342 62 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Permanent Supportive Housing New Construction: 50 Efficiency Units Building Size 32,000 Lot Size 36,000 TOTAL PROJECT COST PER UNIT LAND COST/ACQUISITION Land Cost or Value 300,000 6,000 Demolition 120,000 1,200 Legal 12,000 240 Total Land Cost or Value 432,000 7,440 Existing Improvements Value 750,000 15,000 Off-Site Improvements 40,000 800 Total Acquisition Cost $33.94 1,222,000 23,240 NEW CONSTRUCTION Site Work $8.59 275,000 5,500 Structures $ 148.44 4,750,000 95,000 General Requirements $10.51 336,300 6,726 Contractor Overhead $3.71 118,826 2,377 Contractor Profit $11.36 363,608 7,272 Prevailing Wages $26.72 855,000 17,100 General Liability Insurance $1.31 42,000 840 Total Rehab. Costs $ 210.65 6,740,734 134,815 Relocation Expenses $14.38 460,000 9,200 ARCHITECTURAL FEES Design $6.81 218,000 4,360 Supervision $1.31 42,000 840 Total Architectural Costs $8.13 260,000 5,200 Total Survey and Engineering $1.25 40,000 800 CONST. INTEREST & FEES Const. Loan Interest $7.81 250,000 5,000 Origination Fee $0.28 9,000 180 Taxes $0.22 7,000 140 Insurance & Bond $1.22 39,000 780 Title and Recording $0.63 20,000 400 Total Const. Interest & Fees $10.16 325,000 6,500 PERMANENT FINANCING Loan Origination Fee $0.16 5,000 100 Title and Recording $0.25 8,000 160 Total Perm. Financing Costs $0.41 13,000 260 LEGAL FEES Lender Legal Pd. By Applicant $0.75 24,000 480 Other: Partnership $1.00 32,000 640 Total Attorney Costs $1.75 56,000 1,120 RESERVES Rent Reserves $15.00 480,000 9,600 Replacement Reserve $3.13 100,000 2,000 3 Month Operating Reserve $2.40 76,840 1,537 Total Reserve Costs $20.53 656,840 13,137 APPRAISAL $0.22 7,000 140 OTHER TCAC App/Alloc/Monitor Fees $0.68 21,780 436 Environmental Audit $0.38 12,000 240 Local Dev. Impact Fees $13.13 420,000 8,400 Permit Processing Fees $0.63 20,000 400 Marketing $0.17 5,500 110 Furnishings $6.88 220,000 4,400 Market Study $0.25 8,000 160 Total Other Costs $22.10 707,280 14,146 Subtotals 323.50 10,487,854 208,557 DEVELOPER COSTS Developer Overhead/Profit $30.00 960,000 19,200 Consultant/Processing Agent $2.34 75,000 1,500 Project Administration $0.81 26,000 520 Const. Mngmt. Oversight by Dev. $1.13 36,000 720 Other: security $1.88 60,000 1,200 Total Developer Costs $36.16 1,157,000 23,140 TOTAL PROJECT COST $ 359.66 11,644,854 231,697 Section 3: The Development Process 63 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Emergency Transitional Transitional Permanent Housing Housing Supportive Housing Acquisition New Type New Construction New Construction Rehabilitation Construction Scale 40 40 40 50 Total Development Costs $4,710,922 $5,882,510 $10,333,680 $11,584,854 Hard Costs Per S/F $95.31 $147.81 $166.25 $157.03 Total Cost Per Unit $116,273 $155,563 $258,342 $231,697 Per Unit Range $80,000 to $140,000 to $250,000 to $200,000 to $169,000 $210,000 $340,000 $280,000 It is unsurprising that the per square foot “hard” construction costs differ depending in whether a congregate shelter or private units are being proposed as the ﬁnishes and design characteristics for an emergency shelter are inferior when compared with transitional or permanent housing. The ﬁgures that appear in the table above were used to develop the consolidated budgets associated with this plan. In addition to questions about the availability of resources to develop and operate homeless housing, there are a number of matters that pose serious challenges to any development, whether related to market-rate housing or low-income housing. Such potential barriers may range from the need to mitigate environmental contamination to zoning restrictions, or the lack of public resources for development. One area that has increasingly burdened new development has been the levying of local impact fees. With the passage of Proposition 13, local governments have had to seek out mechanism besides the property tax that could generate revenues for essential services, one place that where they have been especially creative has been impact fees. Impact fees vary by jurisdiction, and some localities in Riverside County waive such fees for affordable low-income housing developments. For example, the County of Riverside waives its Transportation Uniform Mitigation Fee for low- income housing developments. 64 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Impact fees are collected for a variety of infrastructure purposes. Some of these fees are particular to each jurisdiction; others are collected by the local jurisdiction on behalf of the County. Developers of residential projects will ﬁnd that they have to pay fees to several agencies, e.g., Building Department, Public Works, and School District. Some fees are for presumed impacts on the local infrastructure and service delivery system: like law enforcement, ﬁre ﬁghting, and library and school development fees. Fees are assessed both on a per-unit and per-square foot basis. A unique fee is assessed in the western portion of Riverside County (unincorporated) and 14 cities for the Multiple Species Habitat Conservation Plan. Residential developments above 14 units per acre are required to pay a fee of $900 per unit. Parkland fees tend to be the highest levied through the Building Departments, with fees ranging from $1,490 per unit in Hemet to $8,924 per unit in Corona. Infrastructure costs are passed differently, for instance Corona assesses $2,716 per unit for Sewer Capacity, while Hemet charges $2,030 for bridges, signals and thoroughfares. School district fees tend to be among the highest, ranging from $2.93 per square foot in Palm Springs and Palm Desert to $4.27 per square foot in Riverside. Because there is no way to know for certain the scale of any proposed development and its conﬁguration, one can only get the most general sense as to how much impact fees may add to the development costs of a project. In lieu development fees add from $7,000 to $19,000 per unit in Riverside County and its constituent jurisdictions. For a 25-unit project, this could amount to $425,000, a signiﬁcant amount that must be added to the development budget. As a percentage of costs, such fees generally add from three to six percent to the total development costs. Perhaps the greatest barrier in developing housing resources for homeless persons is the likely unpopular response to such plans by local residents. A discussion of the need for leadership in overcoming local resistance is included in the next section of this report. Section 3: The Development Process 65 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 66 Section 3: The Development Process DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 4 SECTION E very development for homeless populations must take into account the many issues addressed in the preceding sections. This section singles out a handful of developments that have resolved the many matters, demonstrating unusual or notable success of one sort or another. Ocean Park Community Center (OPCC), an innovative and nationally-recognized homeless services agency operating in Santa Monica, California recently opened the Cloverﬁeld Services Center located in a largely industrial and commercial area (Figure 4A). This 21,900 square foot multi- Figure 4A. purpose center was developed with $11.4 million in public and private sources. It should be noted that of the total development costs, over $5.1 million was used to acquire the 30,000 square foot parcel. In other words, excluding the cost of land, the shelter cost $6.9 million to develop, a cost of $315 per square foot. County of Los Angeles General Funds $200,000 California Department of Mental Health Unspecified $200,000 California HCD EHAP-CD $1,000,000 LAHSA HUD: SHP $400,000 City of Santa Monica HOME, Redevelopment $7,397,112 OPCC Private fundraising $2,802,888 TOTAL $12,000,000 Section 4: Model Programs 67 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The center has sections devoted to a number of speciﬁc uses. Its Daybreak Shelter has developed 30 partitioned cubicles for homeless women with serious mental health disorders. These beds are managed as Safe Haven units meaning that OPCC has a high tolerance for behaviors that in most traditional models of service-delivery would force a woman back onto the streets. The shelter also includes space dedicated to service delivery, including space for mental health services, medical services, substance abuse treatment services, and on-site recreational and socialization activities. Funds to operate the Cloverﬁeld Services Center come from a federal grant from SAMHSA, local government sources, and private funds from donors. What was particularly noteworthy about the development of this new shelter was the level of local opposition to the shelter from what is generally considered a liberal and tolerant community. Opposition to the location of the shelter came from three main sources. Firstly, although the typical land uses in the general vicinity of the shelter are commercial and light-industrial, the handful of residents within roughly a mile of the site organized in opposition to the City’s investment of funds to acquire the site. A second group of opponents were local businesses although, with the exception of some gas stations and a supermarket, hardly any retail uses are in the vicinity. Rather, the business interests that organized in opposition included body shops, printing shops, and a well-connected private waste disposal ﬁrm. The third group that organized in opposition to the development of this shelter was an internationally-known arts community located adjacent to the site. The local residents were the most strident in their opposition, and that stridency ultimately proved to be its undoing. Carrying signs reading: “No Skid Row in Santa Monica,” and incapable of suggesting speciﬁc design or management changes that would help to mitigate their concerns about neighborhood impact, the City Council was pressed to make a decision that it knew would be unpopular with a section of the local populace. The City’s considerable investment in this shelter (representing over 60 percent of the total funds) goes to show the level of commitment the City was willing to make to support this otherwise unpopular cause. 68 Section 4: Model Programs DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Figure 4B. Martha’s Village and Kitchen opened the Dan Dunlap Center in 2001, a “one stop” center where a range of homeless populations could come to have a large number of their needs addressed (Figure 4B). This 44,000 square foot facility includes a transitional housing program on the top ﬂoor with 34 private rooms (with 120 beds) accommodating homeless families and individuals. The ground ﬂoor includes a variety of uses to assist homeless persons address many of their day-to-day needs. The ground ﬂoor space is used as a secure, outdoor reception/ assembly area with easy access to public showers and laundry facilities (see below). The outdoor reception area also provides access to the dining room, the central feature of the ground ﬂoor service amenities. With a full- production kitchen on-site (Figure 4C), Martha’s Village and Kitchen provides 285,000 meals each year to its residents and other homeless persons in the community. This center also has an on-site Section 4: Model Programs 69 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Figure 4C. licensed childcare center for infants, toddlers, and young children (Figure 4D). Programming includes after-school activities for the children who reside at the shelter. To assist homeless persons re-enter the labor force, Martha’s Village includes a Career and Education Center accessed by 6,000 persons a year (Figure 4E). A particularly unique feature of the Dunlap Center is the presence of an on-site medical clinic serving both residents and low-income, uninsured persons in the community (Figure 4F). Figure 4D. 70 Section 4: Model Programs DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Figure 4E. The Dan Dunlap Center was designed as both a transitional housing facility and emergency shelter. Each evening, the dining room is cleaned and the furnishings moved so that mats may be place on the hard-tile ﬂoors. These mats are allocated on a ﬁrst-come/ﬁrst-served basis to persons needing access to emergency shelter (Figure 4G). Figure 4F. Figure 4G. Section 4: Model Programs 71 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The Dan Dunlap Center requires $3.9 million to operate. An active and extensive volunteer program provides 35,000 hours of community service each year that helps to reduce the overall operating costs. The functional divisions comprising the 2005/06 operating (cash) budget are as follows: Case Management $225,108 Emergency Services $75,081 Children’s Services $376,448 Chaplaincy Services $51,936 Maintenance $400,194 Food Services $715,998 Security Services $318,757 Medical Services $654,675 Career & Education Services $267,166 Resident Services $491,356 Volunteer Services $52,886 Administration $353,483 TOTAL $3,983,089 In terms of the transitional housing component, exclusive of any on-site services that the residents may utilize, the cost per bed per year is approximately $4,100. If half of the security costs are allocated to this, the annual bed cost increases to $5,700. The development of the Dan Dunlap Center was ﬁnanced with the following sources: SOURCE PROGRAM AMOUNT CA Tax Credit Allocation Committee LIHTC (9% credits) $2,615,387 U.S. Dept. of HUD Supportive Housing Program $400,000 Federal Home Loan Bank Affordable Housing Program $500,000 Martha’s Kitchen & Village Private Donations $5,638,807 TOTAL $9,154,194 Of the $9.1 million in total development costs, the amount required to acquire the parcel was a modest $280,000. Excluding land, the total development costs came to $201 per square foot in 2001 and the quality of construction is at least on par with (if not superior to) the Cloverﬁeld Services Center noted above. This shows the signiﬁcant escalation in construction costs over the ﬁrst half of this decade. It should be noted that the development of a comprehensive program such as this may make sense in a handful of population centers where homeless persons may be congregated. In a dispersed county such as Riverside, a more comprehensive planning approach may be to site 72 Section 4: Model Programs DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY small to modest housing resources in several areas to facilitate the integration of the programs and the resident populations into the community. The largest homeless services agency in the Western United States, the Single Room Occupancy (SRO) Housing Corporation, has developed a comprehensive system of care that is capable of addressing the broad range of needs presented by various homeless populations. Operating in the Skid Row section of downtown Los Angeles, SRO Housing has been at the forefront of agencies nationwide creating opportunities to move homeless persons out of poverty and despair and into a more normative set of life-experiences. Over its 22 year history, SRO Housing has developed nearly 1,700 units of single room occupancy housing for homeless (and formerly homeless) persons. SRO Housing uses its inventory in a variety of ways. Two hotels, the Russ and Panama, are used as emergency shelters with a combined occupancy of 369 units. Two other hotels, the Golden West and the Marshal House are used as transitional housing for special-needs populations. An additional 1,100 units developed at 20 different sites by SRO Housing are used as permanent housing. As a community development organization focusing its efforts on the lowest-income population in the United States, SRO Housing has sought to transform both the lives of the unfortunate persons in the downtown area as well as the blighted neighborhood of Skid Row. This neighborhood has received much attention over the past two years owing in large measure to the passionate writing of Steve Lopez of the Los Angeles Times. Lopez has chronicled the journey of a homeless person whom he met on the streets of downtown Los Angeles. His journey has taught him to look at the human suffering in the Skid Row area, but what he has not always fully appreciated is how much progress has been made by the concerted efforts of the City of Los Angeles and nonproﬁt organizations to revitalize this area. As bad as things may appear on the surface, the neighborhood known as Skid Row is far better than in years past because of the redevelopment activity. SRO Housing has been the most active agent of change in Skid Row, having acquired and rehabilitated a large portion of the decaying housing stock and re-marketing it as quality affordable housing for extremely low- income persons. The work of SRO Housing is included here as a model depicting: 1) how Section 4: Model Programs 73 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY a commitment to design and management excellence helps to reduce recidivism or relapse; 2) how supportive housing has helped to stabilize large numbers of persons, and 3) how a comprehensive development plan for homeless housing is achievable. Unlike traditional providers that use mass shelters as emergency shelter, SRO Housing places literally homeless persons in secure, private accommodations at the Russ and Panama Hotels. Each unit in these hotels is separately keyed, and keys are controlled by a front-desk that is staffed around the clock. Each new guest signs a copy of the house rules that include prohibitions on bringing weapons into the facility, using illegal narcotics on-site, or allowing a key to be taken from the premises. A security system through which all residents must pass to enter or leave the buildings prevents the keys from being removed from the premises. Entrusting a formerly homeless person with a key to his own fully-furnished, self-contained residential unit bestows dignity, respect, and a modicum of trustworthiness to him. Private accommodations provide necessary therapeutic spaces that are an antidote to the intensely public experience of living on the streets. Moreover, while ensuring a measure of much- needed privacy, the conﬁguration of single room occupancy units with common bathroom facilities makes it nearly impossible for a person to become isolated and be at risk of engaging in self-destructive behaviors. Each unit is furnished with a bed (not a cot), dresser, chair, and either a wardrobe or closet. Linens are changed by maids upon unit-turnover and weekly for guests staying over. In addition, each of these private units has a sink, medicine cabinet, and window to the outside. SRO Housing recognizes that these unit features distinguish its emergency shelters from those of other providers, yet it accepts these as “necessary luxuries.” Through its model of providing superior emergency shelter accommodations, SRO Housing hopes to reacquaint homeless persons to a more normative life-style, one in which there are reciprocal expectations of behavior and respect. SRO Housing made a conscious decision to reject the model of placing human beings on mats or cots to initiate the process by which persons “recover” from homelessness. Thus, the installation of a private sink and mirror are both potent symbols and the very mechanism by which SRO Housing hopes a person to stop, (literally) take a good hard look and take stock: “is this really the person I have become?” SRO Housing provides personal hygiene kits for each guest as they enter the emergency shelter. These kits include 74 Section 4: Model Programs DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY soap, a toothbrush, toothpaste, shaving cream, a disposable razor, deodorant, shampoo, laundry soap, and tokens to use the washers and dryers. In other words, SRO Housing provides the basic tools by which a person may begin to clean up and shape up and begin to reintegrate into the social mainstream. It is at root the proto-typical “housing ﬁrst” model with the exception that tenancy rights are not established as the units are paid for by an outside source. This is not an insigniﬁcant difference from certain other housing ﬁrst models, but it is one that SRO Housing has felt it necessary to enforce as a necessary commitment to the safety and security of its residents. SRO Housing refers to this as its “try before you buy” strategy, essentially giving its management an opportunity to assess prospective tenants for permanent housing. Recognizing the futility of expecting a homeless person (especially one with a disabling condition) to seek to access normative housing, SRO Housing created the Enhanced Emergency Housing Program (EEHP). EEHP is a case management program providing outreach, engagement, assessment, and information and referral services for persons in emergency shelters. The intent of EEHP is to move homeless persons to more stable housing in as short a period as possible, ideally not exceeding 180 days. Services are aimed at assisting this population in achieving three primary goals: addressing the primary cause of their homelessness (typically an untreated mental health disorder or addiction to drugs or alcohol); increasing the participant’s income (primarily through earnings, but through public beneﬁts as necessary); and achieving residential stability. Clients’ Individual Action Plans include speciﬁc steps to be taken to achieve these overriding goals. Each IAP is developed in conjunction with the program participant to address a wide range of matters including source of income, savings for permanent housing, substance addiction, mental health concerns, lingering legal issues, etc. Each IAP is different based upon the unique resources and needs of the individual; therefore each step varies from individual to individual. EEHP program participants are provided housing referrals as a regular part of their participation in the development of their Individual Action Plans. With over 1,100 units of permanent affordable housing, many EEHP participants leave the Russ or Panama emergency shelters to enter one of SRO Housing’s 20 permanent residences. SRO Housing has obtained 261 Sponsor-based Shelter Plus Care housing rental certiﬁcates through the Continuum of Care process, and it has project-based Section 8 rental assistance attached to an additional Section 4: Model Programs 75 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 497 units at ten of its properties. Some of the rental assistance is restricted to special-needs populations. As a testament of this program’s effectiveness, roughly a third of all of SRO Housing’s permanent residents were once on the caseload of an EEHP Service Coordinator. Many persons are referred by EEHP for drug treatment and return to SRO Housing for permanent housing or to reside at the Marshal House, SRO’s transitional housing program for persons in recovery. A large contingent of EEHP graduates participate in SRO Housing’s Shelter Plus Care program. To some extent, the evaluation of prospective residents while in emergency shelter results from an inefﬁciency that is built into the administration of rental assistance for homeless persons. From the time a prospective resident has been identiﬁed and an application for rental assistance has been submitted, it may take two or even three months for the local housing authority to approve the application and inspect the unit prior to occupancy. During this time, the prospective tenant needs to remain sheltered in either an emergency shelter setting or a transitional housing program. SRO Housing’s management model permits a person to remain stable in housing while awaiting a determination on a rental assistance application. Funding to operate SRO Housing’s emergency shelters comes from a variety of sources and the regulations pertaining to each source does in fact pose a barrier to success from time to time. Among the public agencies that have bought into SRO Housing’s model (and have thereby entered into contractual relationships with it) are the following: Russ Hotel Panama Hotel COMBINED Total Units 168 201 369 Units by Funding Allocation Adult Protective Services 15 0 15 Department of Mental Health 10 0 10 Department of Mental Health–AB2034 12 0 12 Department of Public Health–TB Control 15 0 15 Department of Public Social Services 24 91 115 HOPWA 20 0 20 LAHSA Year-Round Shelter Program 0 100 100 LAHSA-CDBG 0 10 10 Homeless Housing Fund 35 0 35 Veterans Administration (per diem) 36 0 36 Winter Shelter Program 0 0 0 Unallocated Units 1 0 1 Total 168 201 369 76 Section 4: Model Programs DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY A review of the sources funding emergency shelter services at SRO Housing evinces that some of the units are set-aside for special-needs populations, and a few words are in order to single out how some of these sources have been used. The Department of Public Social Services reimburses SRO Housing on a per-diem basis for applicants for General Relief beneﬁts who are either awaiting an initial eligibility determination, or who declare themselves homeless. DPSS provides such persons with vouchers that may be redeemed for emergency housing at the Russ or Panama Hotel. On average, about 2/3 of the vouchers are redeemed, meaning that roughly one out of three homeless persons do not avail themselves of this beneﬁt. The greatest barrier to utilization has been that persons must walk about a mile from the eligibility ofﬁces to the shelters, and for some that is a “long mile.” Utilization has not been a problem for persons receiving shelter through the Department of Public Health, TB Control Unit. These guests are homeless persons in a medically supervised treatment program to combat tuberculosis. Once a course of treatment is begun, it is important that the patient continue until the illness is under control. To stop treatment mid-course means to invite new treatment-resistant bacterial strains into the environment and unleash an outbreak that could seriously threaten the public health. Other sources are limited to speciﬁc populations, like the funding from the Veterans Administration or the Department of Mental Health. In general, the LAHSA-funded units are for a general population of homeless persons, but this source has seemed more intent than others in establishing ﬁxed time limits for which assistance may be offered. In addition to emergency shelter and transitional housing, SRO Housing also provides permanent housing in 20 hotels, with a combined occupancy of over 1,000 units. These are among the few decent, safe, and sanitary permanent housing units that are affordable to the lowest income persons in Los Angeles County, namely persons collecting General Relief beneﬁts of $221 per month. Three of these hotels, the Leo, Southern and Angelus Inn are sober residences that enforce a zero-tolerance policy; one, the Ellis Hotel, is a senior citizen hotel where SRO provides supportive social services and a congregate meal site funded by the City of Los Angeles Department of Aging. The Eugene Hotel and Brownstone Hotel receive Shelter Plus Care project assistance to house disabled persons (respectively, persons living with HIV/AIDS and chronic mental illnesses). The remaining units serve a general population, and SRO has been awarded two allotments of rental assistance certiﬁcates Section 4: Model Programs 77 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY (combined 218 certiﬁcates) through the Shelter Plus Care Sponsor-based Program to serve homeless persons with disabilities. In addition to managing this stock of housing, SRO Housing has also developed a comprehensive system of supportive services to assist its permanent residents remain stable in housing. Funding for social services comes from the County of Los Angeles Adult Protective Services division and HUD’s Supportive Housing Program. These resources provide case management services for disabled persons and those at risk of relapse to homelessness. Moreover, SRO Housing assists its residents through a program of tenant amenities provided at no cost to the residents. Among the free services that SRO offers its residents are: tickets to athletic events, cultural activities, and civic functions; quarterly potluck meals; and monthly birthday (and sobriety birthday) celebrations. SRO also accepts as a part of its regular housing management responsibilities the provision of food in its hotels without charge. With resources from the LA Regional Foodbank and World International, SRO delivers over three tons of groceries each month throughout its hotels. Finally, of particular note, SRO Housing hosts AA, CA, and NA recovery meetings at most of its hotels as well as at a new Community Center it developed in the heart of Skid Row (see Figure 4H). Eugene Yankee Site After Renovation After Renovation 78 Section 4: Model Programs DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Harold Hotel Figure 4H. James Wood Center As an organization dedicated to creating the resources and opportunities for persons to overcome homelessness, SRO Housing has developed a number of unique management practices that help it to achieve its mission. Previously noted was SRO Housing’s capacity to assess prospective residents prior to entering permanent housing. Its 400 units of emergency shelter give SRO Housing an advantage compared to those agencies that do not have the ability to observe homeless residents prior to occupancy. The emergency shelters also provide an important safety valve that supports the operation of the permanent housing. When a person relapses he becomes disruptive to the entire community, engaging in behavior that can be dangerous, like inviting strangers into a building. SRO Housing uses the traditional means at its disposal to resolve problem tenancies, including notices and eviction proceedings. But rather than seek to remedy each problem using the courts (which are slow and uncertain), SRO Housing managers generally look to negotiate with such tenants. In general, the option offered to such residents is free accommodations (for a period) at the Russ Hotel emergency shelter in exchange for an executed voluntary quit notice. In addition, SRO Housing makes clear that if a tenant takes this offer, he will Section 4: Model Programs 79 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY be permitted to re-enter the permanent housing once he has overcome the challenges that have caused the disruptive behavior in the ﬁrst place. A number of persons have in fact returned to the housing community having completed a period of rehabilitation and recovery, thereby conﬁrming to all tenants that SRO Housing stands by its word that it will stand by its residents. This mechanism allows SRO Housing to quickly resolve problem tenancies. Moreover, it provides its case managers an extended opportunity to make contact with the former resident and encourage acceptance of a referral to a residential treatment program. In short, the fact that SRO Housing has a range of housing types at its management disposal means that frequently it is able to prevent homelessness by intervening in such a manner that ensures that a person remains housed. This does not mean that SRO Housing will knowingly permit a person to use illegal narcotics on site on any of its properties. It extends a measure of understanding and tolerance that accepts that recovery may not be a lifetime achievement for all persons. In instances when a party rejects the offer to voluntarily vacate and forces SRO Housing to go through the entire eviction process, SRO Housing places the name of this party on a Watch List and prohibits him from re-entering the permanent housing until reparation has been made. Reparation includes paying any past-due rent and legal fees for having forced SRO Housing into court. Another management practice implemented by SRO Housing also deserves note, namely how it deals with issues of relapse and substance abuse in general. To prohibit occupancy to persons who have used illegal drugs in the past would destine a large percentage of the Skid Row community to life in the streets and thereby further blight the neighborhood. In having developed a range of housing, SRO has sought to create a number of options that might address the range of needs and market demands of the resident community. Among the most challenging populations served by SRO Housing are persons with substance abuse disorders: alcoholics, persons addicted to “Crack,” heroin, or other illegal substances. Recognizing that no single approach to confronting addiction will effectively meet the needs of each person, the following policies and procedures have been established to address the range of issues and problems raised by the use of alcohol and drugs among residents at SRO Housing’s properties. 80 Section 4: Model Programs DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY On-site Possession The possession and sale of illegal substances is a crime, and as landlords SRO Housing has an obligation to protect its residents and its assets. To allow a criminal activity to occur on the premises of a property owned and managed by SRO Housing compromises the Corporation and exposes it (and its employees) to a range of civil and criminal penalties. For this reason, any resident found in possession of drugs or illegal drug paraphernalia are reported immediately to the Los Angeles Police Department. This policy is binding on all properties owned and operated by SRO Housing Corporation. On-site Use of Alcohol vAmendment XXI of the Constitution (ratiﬁed in 1933) repealed Amendment XVIII which prohibited the sale and transportation of alcoholic beverages within the United States. The repeal of prohibition means that the private consumption of alcoholic beverages is a legal activity of any adult. Regardless of one’s personal feelings about alcohol, SRO Housing has not felt that it should seek to control the use of alcohol, except in certain very limited ways. The use of alcohol in pubic settings is regulated by State law, and SRO Housing reserves the right to ask any person in a public setting to refrain from drinking. Places where persons may not drink include: the streets in front of SRO Housing Hotels, the lobbies, halls, and common kitchen and restroom facilities. SRO Housing does permit resi- dents to drink alcoholic beverages in the private units that they lease, but no one is permitted to appear in public with an open container of alcohol. Persons who violate this policy are reminded of the restriction, and if they persist in drinking in public they are served a writ- ten notice of violation of the terms of their lease. SRO Housing Security staff enforces this policy. SRO Housing is not in the business of monitoring every behavior of its residents, and it recognizes that a number of residents may use drugs and/or alcohol off-site. Public intoxication or being clearly under the inﬂuence of an illegal substance in a public area is not tolerated in any of SRO’s properties. Persons found to be under the inﬂuence are instructed that they must retire to their private unit or risk receiving a notice of violation of the house rules of the hotel. Section 4: Model Programs 81 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY SRO Housing has developed three hotels as sober residences for persons who prefer to live that lifestyle. Residents of these hotels sign a special addendum to their leases indicating their voluntary agreement to remain drug- and alcohol-free both on-site and off-site. It has been the experience of SRO Housing that persons who violate this provision of the lease typically reveal the fact to the Housing Manager or the recovery community itself. Should a Housing Manager be informed by a resident of his/her use at a sober residence, the Manager contacts the Director of Social Services and the Director of Housing Management who make alternative arrangements for the resident, such as moving the person to one of SRO’s emergency shelters. In exchange for emergency housing, the Director of Housing Management has the discretion to negotiate a termination of the lease agreement by securing a Voluntary Quit Notice. If a resident refuses to sign a Voluntary Quit Notice, the Housing Manager will be instructed to initiate eviction proceedings and take all legal remedies to secure the unit. At any time during the eviction process, up until a judgment is rendered by the Court, the resident may sign the Voluntary Quit Notice and take advantage of the offer to relocate to one of SRO’s emergency shelters for a limited period until alternative housing can be located. Persons who accept this offer are permitted an uncontested right to lease from SRO Housing again, either at a sober residence, or at a general population hotel, after participating in a recovery program of at a least three- month duration. Persons who force SRO Housing to proceed to a judgment are placed on the Resident Alert List and prohibited from residing in a property managed by SRO Housing for at least three years. At the end of three years, the Director of Housing Management may extend this sanction for cause. SRO Housing endeavors to meet its residents on their own terms. Recognizing that not all persons in recovery prefer to live a sober lifestyle at a sober residence, SRO has adopted a policy toward drug and alcohol use that provides a range of options. Consistent with the goal of providing realistic options that persons will choose to pursue on their terms, SRO has established a pro-active stand toward recovery. What this means in practice is that SRO does not seek to enforce a Zero Tolerance policy in its general population hotels. Rather, a Zero Tolerance policy is enforced only at the Angelus Inn, Leo Hotel, and Marshal House, SRO’s designated sober residences. Persons with mental health and/or substance abuse disorders who reside in one of SRO Housing’s general population hotels are strongly encouraged to 82 Section 4: Model Programs DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY involve themselves in the many recovery options available downtown, and to a great extent this population is monitored by SRO Housing social services staff. However, rather than establish a long period of sobriety as a pre-condition to entering permanent housing, SRO regards sobriety as a goal to be achieved through a process of accepting a greater level of personal commitment to recovery. SRO supports recovery through on-site recovery meetings (AA, CA, NA) at 16 of its hotels, plus the Drifters AA meeting at Gladys Park. The Corporation maintains an up-to-date list of the many recovery meetings that convene in downtown Los Angeles, and makes this available to assist persons identify a meeting for his/her speciﬁc needs. In addition to hosting meetings, SRO supports recovery through education, and (as necessary) referrals to either a residential treatment program or outpatient program. Additionally, Housing Managers within its various permanent housing hotels, make referrals to the Social Services Division when the need arises. SRO Housing encourages its 304 Shelter Plus Care Program participants residing outside of sober residences to minimize their exposure to high-risk behavior, including alcohol and drugs. The case management staff assigned to these residents provides education, information, guidance, and counseling to encourage this population to increase levels of self-control and to minimize self-destructive behaviors. Weighing the competing goals of maintaining a safe and clean residence, as well as meeting the speciﬁc needs of each resident, SRO Housing has adopted the following speciﬁc policies for its Shelter Plus Care (S+C) Program participants who reside outside of sober-living environments: 1. S+C participants who enter with a history of substance addiction must have 180 days of sobriety as a condition of seeking tenancy and must sign an addendum to the lease indicating their willingness to remain drug- and alcohol-free, both on and off site. 2. These participants (and any others who abuse substances while in the program), are required to attend recovery meetings as part of their Individual Action Plans. 3. Relapse is a violation of the agreed upon conditions for S+C housing and is addressed on an individual basis in conjunction with the assigned Case Manager and Licensed Clinician. 4. Persistent use of drugs and alcohol is considered a serious lease violation and may ultimately result in eviction proceedings, depending upon the frequency and intensity of the abuse. Section 4: Model Programs 83 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 84 Section 4: Model Programs DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 5 SECTION T he coordination of local government entities is essential to develop and operate affordable housing, and this is particularly true when the units are intended to be used by persons who are (or have recently been) homeless. Coordination is important for three primary reasons. Firstly, various levels of government control the resources that may be used to assist homeless persons and families. Secondly, municipalities generally establish entitlements for land uses (within state guidelines) and local impact fees, so County-driven development activities require local input, approval, and occasionally concessions relative to fees. Thirdly, leadership that can only be achieved through compromise and coordination is needed to address the considerable obstacles to the development of residential resources to address the problem of homelessness. Appendix I of this report includes a funding matrix and program descriptions of the various key resources that may be utilized to address the problem of homelessness. These resources are generated at all levels of government, and, in fact, nearly all development involves accessing a broad range of funding from different sources. It seems to be axiomatic that a governmental entity will tend to seek to minimize its particular investment to maximum its leverage potential. Put simply, everyone wants the biggest “bang for its buck.” In addition, it has generally been true that leverage works up, much like a weight on a fulcrum, meaning that typically the ﬁrst dollar invested in a project is from a local source as State and Federal commitments nearly always demand demonstrable local support before committing their investment. Thus, as with construction, so too with ﬁnance: a developer works from the ground up, applying for ﬁnancial support at increasingly remote levels of government. The seeming exception to this rule has been that a considerable amount of Federal support for Section 5: Local Government Coordination: Challenges and Opportunities 85 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY affordable housing and homeless assistance is allocated to local governments in the form of block grants. For the most part, these funds become redeﬁned as local, despite their inception from the U.S. Treasury. An advantage to this has been that local governments have found it far easier to commit what from their perspective are “other people’s,” (i.e., federal funds from the U.S. Department of Housing and Urban Development) dollars rather than to seek to invest using their own limited tax resources. In general, the (HUD-originated) resources that localities have used to support the development and ongoing operation of housing for homeless households have come from the Community Development Block Grant (CDBG) and HOME Investment Partnership (HOME) programs. The allocations of these (and other HUD formula-based) assistance to entitlement jurisdictions in Riverside County for Fiscal Year 2006 appears on the page following. By-and-large, HUD’s block grant assistance has remained relatively stable over the past decade, so for planning purposes it makes sense to assume the availability of such funds over time. Table 5A shows that the total block grant assistance from HUD to jurisdictions within Riverside amounts to $27.3 million, the majority of which being allocated to the County of Riverside (nearly $14.6 million). HUD block grant assistance is a largely ﬂexible funding source relative to development and operations, although as with any Federal program, there are a number of limitations like an annual cap of 15% for supportive services for CDBG funds. Table 5B shows how the County’s CDBG allotment has been reallocated to various participating cities in the jurisdiction as well as to the Supervisorial Districts themselves. Clearly the need for federal block grant assistance for community development activities extends well beyond the problem of homelessness, but it should not go unnoticed that the current practice of reallocating CDBG on a “fair share” basis throughout the County TABLE 5A: HUD Entitlement Allocations For The Cities And County of Riverside-FY 2006 Supervisorial CDBG District Jurisdiction CDBG Reallocation HOME ESG HOPWA TOTAL 2 Corona $1,233,892 $477,523 $1,711,415 3 Hemet $717,858 $717,858 5 Moreno Valley $1,802,216 $7,782 $623,440 $2,433,438 4 Palm Desert $356,983 $356,983 4 Palm Springs $518,598 $518,598 1, 2 Riverside City $3,461,498 $24,851 $1,599,230 $147,650 $1,684,000 $6,917,229 1, 2, 3, 4, 5 Riverside County $10,488,729 $51,155 $3,594,993 $443,329 $14,578,206 TOTAL $ 18,579,774 $83,788 $6,295,186 $590,979 $1,684,000 $27,233,727 86 Section 5: Local Government Coordination: Challenges and Opportunities DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY TABLE 5B: County of Riverside CDBG Reallocation, 2006-2007 PROGRAM ADMINISTRATION 2,097,760 ALLOCATED TO PARTICIPATING CITIES DISTRICT 1 2 3 4 5 Banning 180,433 180,433 Beaumont 124,394 124,394 Blythe 142,775 142,775 Cathedral City 301,881 301,881 Canyon Lake1 0 0 Desert Hot Springs 139,461 139,461 Indio 427,161 427,161 Lake Elsinore 236,011 236,011 La Quinta 190,911 190,911 Murrieta 418,887 418,887 Norco 134,202 134,202 Perris 294,688 294,688 San Jacinto 185,184 185,184 Temecula 422,307 422,307 TOTAL MUNICIPAL 236,011 134,202 1,026,378 1,062,728 738,976 3,198,294 ALLOCATIONS ALLOCATED TO SUPERVISORIAL DISTRICTS 1st District 594,473 594,473 2nd District 838,833 838,833 3rd District 901,272 901,272 4th District 606,560 606,560 5th District 526,551 526,551 TOTAL ALLOCATED TO DISTRICTS 3,467,689 TOTAL CDBG BY DISTRICT 830,484 973,035 1,927,650 1,669,288 1,265,527 ALLOCATED TO HOUSING 600,000 PROGRAMS2 ALLOCATED TO Econ. Dev. 1,125,056 PROGRAMS TOTAL CDBG ALLOCATION 10,488,799 1 The City of Canyon Lake’s CDBG allocation is included in the 3rd District Supervisorial allocation. 2 The Housing Programs include Home Repair, Senior Home Repair, and IDA Down-payment Assistance. Section 5: Local Government Coordination: Challenges and Opportunities 87 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY seriously limits the availability of these funds as potential resource that might be available to make a signiﬁcant contribution to impacting the problem of homelessness. In fact the allocations in Supervisorial Districts 3, 4, and 5 are signiﬁcant (over $1 million in each) and, when aggregated within each district CDBG, they could be an important resource for the development of homeless programs and housing. The current reallocation methodology takes what could be signiﬁcant sums and reduces them to what are (at best) modest allocations to the participating cities. These funds are then further re-distributed in even smaller allocations to address a variety of local needs. Thus, given the reallocation methodology implemented by the County of Riverside, in the ﬁnal analysis it is hard to imagine that CDBG could ever be a relevant resource in the development and operation of homeless housing programs. A more strategic approach to the utilization of CDBG would be needed to use these funds to address the problem of homelessness in Riverside County. Most communities throughout California depend upon their CDBG allocations to develop new programs and facilities to assist homeless populations. Section 108 of the CDBG regulations contain a provision for entitlement jurisdictions to borrow from the U.S. Treasury using future allocations for repayment of the debt. The intent of Section 108 is to assist localities in assembling larger sums than they would otherwise be able to aggregate through the CDBG program because the regulations include requirements that localities have uncommitted no more than 150% of their annual allocation. If it proved politically unacceptable to alter the local convention of reallocating CDBG in Riverside County, the only possible recourse to utilize CDBG would be to pursue a strategy of using a Section 108 loan to ﬁnance the development of new homeless housing. In addition to the CDBG committed to the County of Riverside, six other jurisdictions receive direct commitments from HUD (see Table 5A). Given that it may be possible to assemble funds from the other entitlements with a portion of the County’s CDBG, larger allocations may be available that could prove to be useful in the development of housing for homeless populations. Were there political will to dedicate 20% of each jurisdiction’s CDBG allocation to the development of resources to impact the problem of homelessness (an admittedly ambitious goal); nearly $3 million would be made available on an annual basis. On a Supervisorial District basis, funding would be variable, but would amount to at least $500,000 per year as shown in Table 5C. 88 Section 5: Local Government Coordination: Challenges and Opportunities DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY District 20% Entitlement County Allocations Combined CDBG 1 346,150 166,097 512,247 2 592,928 194,607 787,535 3 143,572 385,530 529,102 4 175,116 333,858 508,974 5 360,443 253,105 613,549 TOTAL 1,618,209 1,333,197 2,951,406 This analysis is intended to help policy analysts better understand the consequences of current funding strategies and to consider alternative approaches to the allocation of CDBG funds that may produce better results to develop housing for homeless populations. The intent here is not to suggest that it would be possible to achieve a consensus that 20% should in fact be set aside for the production of housing for homeless and near-homeless populations. Rather, the goal here has been to encourage thought about ways that resources may be aggregated to achieve substantive results. Municipal governments have considerable other resources available for development purposes, particularly funds controlled by local redevelopment agencies. A summary of redevelopment funds that may be available to develop and operate homeless programs appears in Table 5D. As over against the limited number of federal entitlement jurisdictions, the creation of redevelopment agencies and project areas has been a popular strategy for all but one municipality in Riverside County (the exception being Canyon Lake). The gross tax increment generated by the redevelopment project areas amounts to nearly $360 million, with just under $72 million required to be set-aside for affordable housing development. Housing set-aside funds may be used to develop and operate homeless assistance programs. It should be noted that the housing set-aside is a statutory minimum and many jurisdictions throughout California have invested considerably more than the mandatory minimum to create and sustain affordable housing for low-income populations, including homeless populations. Other than the totality of federal assistance for housing (meaning not only the block grant funds referenced above) redevelopment has been the largest source of funds for affordable housing development. Section 5: Local Government Coordination: Challenges and Opportunities 89 90 TABLE 5D: California Redevelopment Agencies - Fiscal Year 2004/2005 Project Area Contributions to Low and Moderate Income Housing Fund Data as of: 5/1/2006 100% of Gross 20% Required Tax Increment Tax Increment Repayment of Additional Total Project Area Project Area Tax Set Aside to Allocated to Deposited to Prior Years’ Deferrals Income Receipts Deposited PROJECT AREA Increment Housing Fund Housing Fund Housing Fund of Tax Increment to Housing Fund BANNING $2,512,556 $502,511 $502,511 $502,511 0 $57,333 $559,844 BEAUMONT $2,273,410 $454,682 $454,682 $454,682 0 $9,125 $463,807 BLYTHE $4,414,375 $882,875 $882,875 $882,875 0 $3,095,511 $3,978,386 CALIMESA $421,272 $84,254 $84,254 $84,254 0 $5,591 $89,845 CATHEDRAL CITY $17,586,301 $3,517,260 $3,517,261 $3,517,261 0 $2,483,322 $6,000,583 COACHELLA RDA $4,237,819 $847,564 $847,563 $847,563 0 $1,033,028 $1,880,591 CORONA $15,643,754 $3,128,751 $3,128,751 $3,128,751 $53,718 $2,200,488 $5,382,957 DESERT HOT SPRINGS $3,693,280 $738,656 $738,535 $738,535 $71,638 $810,173 0 HEMET $7,600,065 $1,520,013 $1,520,013 $1,520,013 $1,019,951 $2,539,964 0 INDIAN WELLS $27,593,501 $5,518,700 $5,518,700 $5,518,700 $476,002 $5,994,702 0 INDIO RDA $6,298,605 $1,259,721 $1,259,721 $1,259,721 $184,006 $1,443,727 0 LA QUINTA $51,323,319 $10,264,664 $10,282,664 $10,282,664 $4,326,581 $14,609,245 0 LAKE ELSINORE $13,136,082 $2,627,216 $2,627,216 $2,627,216 $100,999 $2,728,215 0 MORENO VALLEY $9,718,925 $1,943,785 $1,943,785 $1,943,785 $294,773 $2,238,558 0 MURRIETA $3,431,025 $686,205 $686,205 $686,205 $32,009 $718,214 0 PALM DESERT $62,013,998 $12,402,800 $12,402,801 $12,402,801 $6,748,558 $19,151,359 0 PALM SPRINGS $7,728,670 $1,545,734 $1,545,734 $1,545,734 0 $1,545,734 0 PERRIS $5,006,849 $1,001,370 $1,001,370 $1,001,370 0 $45,732 $1,047,102 RANCHO MIRAGE $26,210,427 $5,242,085 $5,242,085 $5,242,085 0 0 $5,242,085 RIVERSIDE COUNTY $41,311,826 $8,262,365 $8,291,740 $8,291,740 0 $95,325,779 $103,617,519 RIVERSIDE RDA $21,243,066 $4,248,613 $4,248,613 $4,248,613 0 $13,622,384 $17,870,997 SAN JACINTO $3,075,648 $615,130 $615,130 $615,130 0 $4,046,106 $4,661,236 TEMECULA $12,663,849 $2,532,770 $2,532,770 $2,532,770 0 $461,477 $2,994,247 COUNTY TOTAL $ 359,977,834 $ 71,995,566 $ 72,042,821 $ 72,042,821 $13,607,626 $176,633,000 $ 153,789,199 Section 5: Local Government Coordination: Challenges and Opportunities DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Redevelopment is a complex area of law that is ever-changing. A few salient points need to be addressed at this point to elucidate how redevelopment funds may or may not be used to develop homeless housing. There is no question that resources generated in a redevelopment project area may be used for affordable housing within that project area. Housing set-aside funds may also be used outside of the project area in which they were generated. In fact, redevelopment agencies may transfer funds from one project area to another in order to satisfy the 20% requirement. An agency may use its 20% housing set-aside funds either within or outside of a project area, but use outside of a project area may only occur after a ﬁnding of fact by the agency and the legislative body that the housing will beneﬁt the project area. In practice this means that the 20% requirement is essentially agency-based, not project- based. Moving housing resources outside of the jurisdiction in which they were generated, however, is problematical (at best). There is a very narrow window of opportunity to transfer housing set-aside funds from one jurisdiction to another and it should be noted that this is a highly contentious area that could easily lead to litigation. A number of redevelopment agencies would rather not invest in affordable housing for low- and moderate-income households, particularly as regards developments that are actively seeking to assist homeless or recently homeless individuals or families. Because other agencies might welcome additional ﬁnancial assistance in the form of resources for affordable housing development, it has been suggested from time-to-time that agencies should be permitted to transfer monies from their housing funds to nearby communities. Opponents of this concept regard this as an attempt by local governments to evade their responsibilities to develop affordable housing. A provision was added to redevelopment law in 1992 that authorized the transfer of housing resources where adjoining cities had contiguous agencies willing to develop a joint powers agency to pool housing funds. This provision expired on January 1, 2001. Until 2001, however, redevelopment agencies were permitted to transfer funds to a joint powers authority under the following circumstances: 1. The jurisdiction must have met at least 50% of its need as included in the Regional Housing Need Allocation plan; 2. Reallocated funds had to be encumbered within two years; 3. The funds had to provide a direct assistance to the proposed development; and 4. Each project had to be certiﬁed by HDC to be in compliance with the statute. Section 5: Local Government Coordination: Challenges and Opportunities 91 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY These limitations made it nearly impossible for housing funds to be reallocated across jurisdictional lines. In addition to the mandatory 20% housing set-aside, each redevelopment agency is responsible for implementing an inclusionary housing plan. This requirement (§33413(b)) requires that at least 15% of all new and substantially rehabilitated dwelling units within a project area shall be affordable to low or moderate income households. Where it is impractical for a jurisdiction to provide for the affordable units within a project area, the redevelopment agency may transfer the responsibility outside of the area at the rate of two units for every one that would otherwise have been required within the project area. Additional information about federal block grant assistance and redevelopment housing set- aside funds may be found in Appendix A of this report. Another critical reason why it is important to have close coordination between municipalities and the County relative to the development of homeless programs is that cities establish the eligible uses for parcels within its jurisdiction. Land use is highly regulated by State law which has increasingly imposed standards on local governments that facilitate the development of affordable housing. This does not mean, however, that either a private organization or a governmental entity has entitled rights to develop as it sees ﬁt in a municipality. Rather, in many instances, a jurisdiction may require homeless shelters to be located only on certain types of parcels and in limited areas. This does not mean that a city would reject out of hand a proposal to site a shelter or affordable housing development for homeless persons in on parcels not meeting the speciﬁc Code. The process either to re-zone a parcel or to secure Conditional Use Permits to operate homeless housing may well take many months which may even extend to years. Moreover, to place a program on a non-conforming parcel means to invite much public scrutiny which will likely result in an adverse reaction by local interests. At the very least, a protracted approval process relative to land-use entitlements could delay a development signiﬁcantly, thereby undermining the will of the development entity which may seek alternate (and seemingly less controversial) sites. This report does not include a discussion of how each local jurisdiction has zoned its land relative to the development of housing and other facilities intended to assist homeless persons. Nor does the analysis include a discussion of the potential sites that may be available in redevelopment project areas. 92 Section 5: Local Government Coordination: Challenges and Opportunities DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Perhaps no better example of the critical need for local government coordination can be found than by considering the example of the City and County of Los Angeles. For nearly a decade in the 1980s and 1990s, these jurisdictions were entangled in a legal dispute in which each attempted to place responsibility on the other for the problem of homelessness. The County alleged that the City’s land-use policies (including the demolition of single room occupancy hotels in the downtown area) and limited investment in new affordable housing production was forcing persons into the streets. The City countered that the County failed in its responsibilities to provide appropriate supportive social services and beneﬁts to destitute homeless persons and families. The result of this stand-off was the creation of a joint-powers agency to address homelessness, the Los Angeles Homeless Services Authority (LAHSA). The underlying conﬂict that created LAHSA has resurfaced from time to time, as neither the City nor the County has invested signiﬁcant resources to be administered through this “independent” agency. In fact, both the City and the County have each invested considerable sums over the past few years in initiatives independent of LAHSA. The problem, however, is that these approaches have not been coordinated, and in their implementation, occasionally they have been at cross purposes. The creation of a joint powers authority is only one approach that has been used to coordinate local government efforts relative to homelessness. A number of mechanisms currently exist that may be utilized to coordinate municipal and County efforts and develop comprehensive, consensus-driven plans. In particular, it may be advantageous to involve the Coachella Valley Association of Governments (CVAG) and the Western Riverside Council of Governments (WRCOG) in planning efforts. Another mechanism already in existence is the annual Continuum of Care planning process undertaken by the Department of Social Services, Homeless Assistance Division. While primarily intended to plan for the use of HUD funding for homelessness, the process could be expanded to incorporate a broader range of policy considerations and resources. Given the need for local governments and not-for-proﬁt organizations to work in unison to secure HUD homeless assistance through the Continuum of Care planning process, it is worth considering the current status of these funds and their likely future course. This discussion of HUD McKinney-Vento funding appears in this section on local government Section 5: Local Government Coordination: Challenges and Opportunities 93 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY coordination because securing these funds depends almost entirely upon coordination. Over the past decade (both directly and indirectly) HUD has allocated several billions of dollars of assistance to local and state homeless services agencies. In turn, these agencies have provided a number of homeless populations throughout the country with a vast array of programs, services and housing. HUD awards homeless assistance via two primary mechanisms authorized by the McKinney-Vento Act: a) formula allocations to larger jurisdictions through the Emergency Shelter Grant (ESG) Program (a total of $591,000 divided between the City and County of Riverside), and b) the Continuum of Care planning process. The Continuum of Care process allocates funding for three programs: the Supportive Housing Program (SHP), Shelter Plus Care (S+C) Program, and the Section 8 Moderate Rehabilitation for Single Room Occupancy Housing (SRO) Program. SHP allows a grantee to undertake a range of eligible activities including: acquisition, rehabilitation, new construction, leasing, operational assistance, supportive social services, and developing and maintaining an Information Technology system known as the Homeless Management Information System (HMIS). SHP is also the most ﬂexible program relative to the homeless populations it assists, including: families, disabled adults, runaways, emancipating foster youth, victims of domestic violence, veterans, and many other populations. It is primarily because of its ﬂexibility that this has been the most popular of HUD’s homeless programs. The latter two programs, S+C and SRO, are rental assistance programs (i.e. what is commonly known as Section 8) that are primarily used to assist homeless individuals (although there are a handful of S+C programs for family households). The Continuum of Care is a competitive local process undertaken by a planning body that is established by either custom or statute. Localities compete for a pre-deﬁned allocation of HUD assistance that tracks the Community Development Block Grant (CDBG) formula. HUD deﬁnes this allocation as “pro-rata need.” When it ﬁrst began to allocate assistance via the continuum of care process, HUD did not inform localities of their pro-rata need, so communities essentially loaded the boat and included a staggering number of projects in their plans. Since 1996 HUD has published the pro-rata need so that planners could make more informed decisions regarding how ambitious their efforts can be relative to available resources. 94 Section 5: Local Government Coordination: Challenges and Opportunities DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The entity that takes on the planning for homeless assistance differs from one community to the next based largely upon politics. In general this is not an area in which local governments prefer to have a role unless they feel that they can best administer the assistance in a responsible manner. Thus, in many communities, homeless coalitions assume the authority to plan for HUD assistance. In others, the planning is under jurisdictional control, either by a municipal or county department or other government body. In Riverside, the planning work is conducted by the Department of Public Social Services. HUD allows localities to determine the authorized planning body, but it does not permit “renegade” planning processes as only a single plan may be submitted from each locality. One reason that HUD allows for ﬂexibility is that it seeks to engage the widest number of jurisdictions in the planning process. Prior to implementing the Continuum of Care planning process in 1993, HUD awarded grants through a direct funding process. The sheer volume of grant applications and the fact that HUD headquarters was not in a position to make good local decisions led the Department to initiate a locally-driven planning process. Moreover, toward the end of the 1990s Congress began to put pressure on HUD to demonstrate that its investment in homeless programs was making a substantive difference. To its credit, HUD recognized that funding programs was secondary to encouraging systems change as a way to attack the problem of homelessness. HUD recognized that much homelessness results from poor systems integration. For example, the medical system might restore a person’s health and then seek to discharge him from its care. HUD’s focus on local planning has sought to bring communities to examine how their “mainstream” programs failed to attend to the many factors that might result in homelessness. In short, HUD has hoped that improved planning would encourage communities to take stock of policies and procedures that either directly create homelessness or maintain barriers to overcoming it. Such is the ofﬁcial policy goal. In practice, many locally developed continuum of care plans are only thinly disguised justiﬁcations for sustaining the funding of particular agencies whether or not their projects substantively address the problem of homelessness. This is partly due to the fact that HUD homeless funding now supports over 4,000 projects nation- wide, each one of which creates a new particular interest to be protected. Many veterans groups have argued that their interests have not been represented through the funding Section 5: Local Government Coordination: Challenges and Opportunities 95 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY mechanism established by HUD, and this may or may not be the case. What is clear is that 70% of all HUD McKinney-Vento funds now go to renew existing projects, including a growing allocation of rental assistance. In 2004, for example, HUD funded 4,406 projects of which 715 (or 17%) were entirely new. Competition from renewal grants makes it challenging for a potential new grantee to get into the process, but there are methods by which this can still happen. In order to understand how an agency might be awarded a grant to inaugurate a new program, or to expand an existing one, it is essential to know how to: 1) propose a project that will be perceived as addressing a priority need, and 2) put an agency in an advantageous position in the planning process. Put simply, one needs how the system so as to inﬂuence the system. While many persons are familiar with the HUD Supportive Housing Program, few grantees have taken the time to fully understand how the HUD Continuum of Care process actually works. So long as their projects get funded—that is, so long as their particular interests are addressed—they are satisﬁed. In as much as the entire process is geared to systems-change, however, it is unwise to take a short-sighted and narrow view of these resources, even if one receives an award. Rather, it makes sense to plan to align one’s agency with the long-term trends and to become part of the emerging new system of care, rather than to be intransigent and trapped into old ways of thinking about serving homeless populations. The Continuum of Care planning process begins at the local level. Local planning bodies review applications that are placed in priority order for HUD. In general, as long as there is a sufﬁcient justiﬁcation for the inclusion of a project, and as long as the proposed project is eligible, HUD will provide funds if the local plan makes the grade. The plan itself appears as Exhibit 1 of the application to HUD and the speciﬁc projects (SHP, S+C, and SRO applications) are placed behind it. HUD evaluates continua plans on a 60 point scale, to which are added 40 points for “ﬁrst tier” projects (that is, those falling within the pro-rata need established by HUD). In previous years HUD assigned points to 2nd and 3rd tiers, and a number of these projects were funded, but because the minimum threshold for funding has been steadily rising it is no longer possible to award a 2nd tier project. Put in practical terms, if HUD were to assign a score of 40 to a continuum, each “ﬁrst tier” project would receive a score of 80 (40 for the plan and 40 for being in the ﬁrst tier of pro-rata need). After all projects have been scored this way, they are put in rank order and HUD then allocates funds 96 Section 5: Local Government Coordination: Challenges and Opportunities DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY until they are exhausted. In the 2004 competition HUD funded projects that received at least 82 points; those scoring less were dropped from consideration. There is one exception to this, in the case where a ﬁrst tier renewal project received less than the threshold but more then 60 points, HUD would provide the funding necessary to sustain that program for one year. This is a concession that HUD provides so as not to force a community to completely dismantle its system of care. The critical thing to note in this is that as worthwhile as one may consider a project to be, it is impossible to be awarded funding through the continuum of care process unless the local plan scores well. And, because the funding it competitive, it is critical that a community’s plan fare well relative to others. In short, the Continuum of Care process is a national planning competition. So, even as they focus on how their projects rank relative to others in a local continuum of care plan, applicants for HUD McKinney-Vento assistance need to also consider how the local planning process will be evaluated by HUD. Because everything depends upon the quality of local planning, this creates an advocacy and evaluation opportunity for parties interested in this process as they seek to hold local planning bodies accountable. HUD initiated this process of awarding homeless assistance based upon a nation-wide competition in 1993 and since then it has tinkered with the system but kept it largely intact. The rudiments have remained constant: localities are allocated “pro-rata need” based on the CDBG model, and then HUD adjusts this ﬁgure to account for local renewal demand and to encourage communities to undertake permanent housing activities. The 2005 and 2006 Continuum of Care planning process differs from prior year processes relative to both assisting communities with high renewal demand, and providing bonus funding for permanent housing projects. In years past, a continuum community with a heavy renewal demand could expect all of its projects to be awarded at least one year of funding so that they could sustain the system of care. In many communities the annual application to HUD was largely static because the localities had expanded services to the point that their pro-rata need was roughly equal to the annual costs of renewing all applications. In order to allow for greater ﬂexibility, and to further encourage communities to increasingly direct resources to establish permanent housing options for chronically homeless persons (and not simply accept the status quo), HUD now allows continua that have maximized their pro- rata need with renewals to decrease or eliminate funding for existing projects and to receive Section 5: Local Government Coordination: Challenges and Opportunities 97 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY the equivalent value of any savings. In other words, some continua will now be permitted to create new projects at the expense of existing ones, with one critical proviso: the funds released through this process must be used to develop new permanent housing for chronically homeless persons. HUD refers to this provision as “hold harmless.” One would expect the hold harmless mechanism to drive continua to evaluate more rigorously the relevance of a particular project or service to resolving the problem of chronic homelessness. As it alters the scoring criteria of the Continuum of Care process, HUD has increasingly pressed continua to conﬁrm that the components of each system are justiﬁable relative to the most critical local needs. Having noted this, it bears noting that the impetus for this is an effort initiated by HUD to see that McKinney-Vento Homeless Act funds are increasingly steered to projects that are intended to help localities end chronic homelessness. This is not the place to discuss 10-year plans to end chronic homelessness, except to note that a considerable number of points in the Continuum of Care plan competition are awarded based on the quality of planning surrounding the problem of chronic homelessness. What matters most to HUD? How does HUD evaluate a Continuum of Care Plan? In truth, goaded by Congressional critics who question whether HUD’s investment in homeless services and housing has made much of an impact on the problem, HUD has changed its evaluative criteria over time. Table 5E shows the shift in HUD evaluative criteria over the past three years. The table makes clear the increased emphasis through time on housing and a community’s evaluation processes. HUD is pressured to demonstrate that its resources are well-spent and achieve substantive results, but it recognizes that local communities have generally been unequal to the task at hand. For this reason HUD has steadily been trying to encourage communities to narrow their use of these funds on chronic homeless populations and housing activities. The ﬁnal score awarded to a continuum of care plan is then assigned to each project in the application. Projects falling within a continuum’s ﬁrst tier allocation of pro-rata need then are assigned 40 points for need to arrive at a ﬁnal score. All projects from throughout the country are then placed in rank order and are allocated an award until the money is exhausted. There are a handful of exceptions to this rule. Congress has mandated a number of funding goals for these funds: 1) that no less than 30% of all funds are awarded to permanent housing projects, and 2) that at least 10% of the funds serve chronic homeless persons. If insufﬁcient funds 98 Section 5: Local Government Coordination: Challenges and Opportunities DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY are available to fund all projects receiving identical scores, HUD will ﬁrst fund proposals for permanent housing, then other housing for chronically homeless populations. To break any remaining ties, HUD looks at continuum of care scores for select criteria. So while particular projects end up being funded, it is critical to understand that HUD evaluates plans not projects. Thus to the extent that one can participate in and improve the local planning process so that it is relatively consistent with HUD’s expectations, the projects included in the plan have a better chance of being funded. Also, despite the fact that HUD publishes pro rata need ﬁgures ought not to lead one to conclude that the community will be awarded these funds. Every year a number of continua are not funded because their plans were not competitive when stacked up against the work being undertaken in other jurisdictions. There are numerous instances in which communities are simply not funded. Table 5E also makes clear what has been a consistent pronouncement from HUD over the past several years, namely, that planners must attend to the permanent housing needs of homeless populations, particularly chronically homeless persons.3 YEAR CRITERION 2003 2004 2005 1. Process & Strategy 20 17 17 a) coordinated & inclusive process b) comprehensive strategy c) strategy to end chronic homelessness d) local plan to remove regulatory barriers e) participation in Energy Star 2. HMIS Implementation included above 5 5 3. Gaps & Priorities 15 10 10 a) description of analysis undertaken b) proposed projects consistent with analysis 4. Leveraging & Supplemental Resources 15 13 8 5. Emphasis on Housing Activities 10 10 12 6. Performance Measurement (progress toward reducing chronic homelessness) 0 5 8 TOTAL SCORE AVAILABLE 60 60 60 3The HUD deﬁnition of homelessness and chronic homelessness appears in the section of this report on home- less sub-populations. Section 5: Local Government Coordination: Challenges and Opportunities 99 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY In-as-much as the primary resource used to assist homeless populations in Riverside County has been Continuum of Care funds from HUD, it is important that future planning efforts take into account these trends and that programs are developed to not only secure these funds but also to show results in moving homeless populations into stable living environments. Homelessness is hardly a new phenomenon, but our understanding of it, and approaches to resolving this social problem have received increased attention over the past few decades. A survey of American history would ﬁnd that newspapers in communities throughout the country have reported on problems created by vagrancy, transients, and rootless men and women whose presence in an otherwise settled area occasions alarm and calls for social action. The various waves of social action that began in the 1840s and culminated with the passage of the 18th Amendment to the U.S. Constitution in 1920 was largely a reaction to the demonstrable impact of alcohol on the social fabric of communities, including creating large numbers of persons whom we would today classify as “homeless.” The 21st Amendment repealed Prohibition in 1933 just prior to the unleashing of the New Deal which created a broad array of social experiments intended to stimulate the national economy and lift households out of poverty, ignorance, and social isolation. When one out three breadwinners was unemployed, a national consensus emerged in support of poverty programs. As America became an “afﬂuent society” in the years following the Second World War, fewer households fell into or remained in poverty, and public support largely waned for programs, services, and beneﬁts for what was increasingly perceived as the “undeserving poor.” As a social issue, the problem of homelessness has waxed and waned in the public conscience as a matter deserving and requiring investment of time, energy, and political will to address. Moreover, few communities have evolved policies around which a concerted set of actions can be organized to address the many problems related to homelessness. In such an environment, proposals to create resources to address homelessness generally have been met with a common local response: not in my backyard (NIMBY)! An initial negative response to a speciﬁc project proposal should hardly be surprising. People generally care about the quality of life in their communities, and they want to see things improved. They fear that a development serving homeless populations will necessarily blight the neighborhood. Decision ofﬁcials should not reject local concerns as knee-jerk NIMBY 100 Section 5: Local Government Coordination: Challenges and Opportunities DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY reactions. Rather, it is important to air concerns in public so that planning ofﬁcials may seek to mitigate the most serious matters and work to achieve a consensus on what can and should be done at a speciﬁc site. In general, this vetting process tends to help educate the public on the problem of homelessness and how local government and non-proﬁt organizations have partnered to create solutions. The challenge, however, is that the process of raising public awareness and understanding and achieving consensus is extremely time-consuming, stressful, and risks considerable political capital. In short, it is precisely the kind of issue that requires leadership, particularly as the interests of the various actors will likely be at odds with one another. Among the approaches to moving beyond NIMBY reactions has been to confront the problem in community forums where proponents and opponents may air their concerns with each other. An effective program of community outreach should be organized that emphasizes the quality of the proposed design, the rigorous management practices that will be employed, and addresses the fears that neighbors have of homeless populations. Good design helps to enhance the neighborhood and may bring much needed new resources into an area. Whenever possible, the design should comport with community standards and incorporate quality and enhancements whenever possible (taking into account budgetary constraints). Research conducted by the Corporation for Supportive Housing has found that the creation of supportive housing in a community has no adverse impact on property values.4 One reason for this has been the attention paid to quality design so that the end result is a development that adds character to the neighborhood. Another factor to consider in addressing NIMBY responses to a proposed development is the management plan. Because most affordable housing is ﬁnanced with a variety of public sources, they much comply with a broad range of regulations, including maintaining the property as descent, safe, and sanitary. Moreover, normative management practices necessitate the screening of all potential residents. In the end, perhaps no matter how well-reasoned may be a planned development for homeless populations, there will likely be local opposition as there will always be a number of fears and concerns that are not capable of being resolved through 4University of Pennsylvania Health System, Department of Psychiatry, Center for Mental Health Policy and Services Research Kay E. Sherwood, TWR Consulting, Connecticut Supportive Housing Demonstration Pro- gram Evaluation Report (1999). Section 5: Local Government Coordination: Challenges and Opportunities 101 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY rational discourse. It is precisely at moments such as these that solid leadership is required to advance a development proposal. To assist developers and local governments address NIMBY concerns, the State of California has created a web-site that assembles a variety of tools and resources that may be used to move debate on such matters.5 5http://www.hcd.ca.gov/hpd/nimby.htm 102 Section 5: Local Government Coordination: Challenges and Opportunities DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY 6 SECTION T he goal of any plan to address the problem of homelessness is to alleviate human suffering and end the phenomenon altogether. To some extent, homelessness has been a part of the American experience since the earliest days of settlement. Local communities provided some manner of support for families stricken by calamity even if it meant having to live in a “poor house.” A transient may receive a bowl of soup and religious instruction, but such “vagabonds” were generally not regarded as the responsibility of a local community. Rather, the community generally regarded transients as the “undeserving poor.”1 A complex modern, industrial society with numerous opportunities for physical and social mobility (both upward and downward) necessarily creates a number of rootless persons who live betwixt and between otherwise settled populations. One reason for this is that resiliency is variable and not all persons have the psychological or material resources to adapt to the demands of everyday life. Some persons may have signiﬁcant barriers to full social integration like a physical or mental health disorder. Another reason is that the systems of care that have been developed are generally not well-coordinated, making it challenging for extremely low- income persons to navigate a steady course to greater self-sufﬁciency and residential stability. Homelessness is a complex social phenomenon that is indicative of the poor coordination of systems of care and the inability of certain subpopulations to integrate into the social mainstream. Inadequate social integration is particularly true of chronically homeless persons: i.e., disabled persons that have lived a year or more without normative housing. What 1 Herbert J. Gans, The War Against the Poor, (New York: Harper Collins, 1995), p. 89 et seq. Section 6: Development Strategy for the County of Riverside 103 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY are reasonable expectations that should be placed upon social service programs to move homeless populations back into the social mainstream? Given that homelessness often results from inadequate discharges from institutional settings, is it realistic to expect homeless persons to achieve social stability when placed in community settings? Clearly, public investment in programs to assist homeless persons should be able to meet a basic level of performance relative to accountability and compliance: shelters should be clean and orderly, and ﬁnancial records should be above reproach. While poor social integration is clearly positively correlated with homelessness, no factor is as determinative as is income. Homelessness is fundamentally an economic problem: extremely low-income persons lack the means to afford market-place rents. The economic challenges confronting homeless persons are especially pronounced for persons on limited, ﬁxed incomes. In Riverside County, an entry-level job is insufﬁcient to afford market-rate housing, even sub-standard housing. As market conditions press housing expenses higher, persons on ﬁxed incomes experience increased stress and possible social dislocation. A “rising tide” does not lift all ships; extremely low wage earners and those on low ﬁxed-incomes risk “drowning” as real estate markets become heated. The intent of social service programs to assist homeless persons is methodically to assist persons stay on track and access beneﬁts and services and (for those capable of employment) ﬁnding and keeping a job. The process of case management is the fundamental form of assistance that has been used to reintegrate homeless persons back into the social mainstream. Homeless programs vary in many fundamental respects. Capacity and capability are unequal across programs. There is the general expectation that agencies able to pay higher salaries will be in a position to attract and retain a talented and professional staff when compared with agencies with lower paid staff. How program staff interacts and communicates with clients also differs markedly across agencies; some agencies have charismatic leadership able to reach persons in a manner that is both therapeutic and transformative. Such types are rare, and their skills are not always replicable or transferable to others. Programs also differ in terms of their physical conﬁguration, stafﬁng level, staff to client ratios, access to resources, and the populations they serve. Evaluating “success” across the varied landscape of diverse programs and services requires sensitive tools capable of taking into account the multiple variables that may impact 104 Section 6: Development Strategy for the County of Riverside DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY outcomes. Some effort to create a standard methodology to account for success and track client outcomes was implemented by the State Department of Mental Health with the advent of AB2034 program funds. AB2034 funding requires a signiﬁcantly higher level of client tracking and evaluation than has been seen in most other programs. The system developed over the past decade of funding may soon be scrapped in favor of an even more rigorous system to be implemented to track clients receiving Mental Health Services Act (Proposition 63) services. A State working group has been convening to design the new system. HUD has pressed continuum of care communities to implement more rudimentary client tracking systems through its Homeless Management Information System (HMIS) requirements. All continua are to have implemented a baseline system to track homeless persons by 2007, and increasingly these modalities have been brought online over the past two years. HMIS does not include meaningful acuity measures so it is not an effective tool to help determine a person’s level of functioning. Also, these systems generally only track literally homeless persons; they do not include information on at-risk populations, nor are they particularly effective after a person reestablishes himself in an independent living situation. These systems do, however, record a homeless person’s frequency of contact with agencies operating within a continuum, and in this regard they can be useful in identifying “high utilizers.” Is a person accessing many services because they are in great need, or are they “program shopping” and receiving redundant services. Congress mandated that continua establish HMIS so that homeless persons could be viewed from a systems-level perspective. Yet because HMIS is a rudimentary system when compared with other tracking systems used by other systems of care, it is not at all clear that this redundant system will be useful at the client-level so much as at the systems level where planners may utilize the information to recommend program and/or policy changes in light of empirical data. With respect to client or resident outcomes, however, it may be difﬁcult to establish a single ﬁxed set of outcomes that all programs should meet. One reason for this is that in order to establish expectations regarding outcomes, it is essential that there ﬁrst be set criteria regarding intake and admission. A second reason why it may be difﬁcult to establish ﬁxed expectations with respect to outcomes is that not all agencies have equal access to certain resources to help persons achieve greater stability in their lives. A transitional housing program for persons in recovery may be able to point to a high rate of success in helping Section 6: Development Strategy for the County of Riverside 105 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY homeless persons access permanent housing, but its success may have less to do with its programs and services, than with the rental assistance certiﬁcates that it may offer “graduates.” An outreach program for homeless persons with mental illnesses may focus its efforts on the most seriously disabled populations of which only a handful may regularly access mental health services in a year. Access and acuity are two factors that challenge any outcome measurement system. TABLE 6A: Matrix of Probable Outcomes High Acuity Low Acuity (Gravely Disabled) (Limited Special Needs) LOW PROBABILITY OUTCOME Limited Access OF SUCCESS UNCERTAIN to Services Prolonged Client motivational homelessness consideration OUTCOME HIGH PROBABILITY UNCERTAIN OF SUCCESS High Access to Program Residential Services effectiveness stability considerations As the County of Riverside grows its HMIS and MHSA tracking systems, it will be useful to analyze reports on client outcomes to help operators modify existing programs and services, and to recommend new services as necessary. In this regard, it may be useful to bear in mind the interplay of the availability of services (that increase the likelihood that a homeless person may achieve housing stability) compared against acuity and level of functioning (factors that decrease the long-term prognosis for achieving and maintaining housing stability). Other things being equal, like program performances, the impact of these two critical variables may look something like the depiction in the matrix of probable outcomes (Table 6A). 106 Section 6: Development Strategy for the County of Riverside DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The intent of this report has been to provide information on the basic materials and methodology of creating new housing for homeless populations. An assessment of countywide (or baseline) need is outside of the scope of this research, but the analysis does include an allocation and an implementation plan broken out both by Supervisorial District and special-needs population. For the purposes of this report, baseline need has been derived from the County of Riverside: County of Riverside 2004/2005 Homeless Assessment.2 In addition, this research has relied upon the inventory of homeless housing contained in the 2006 Continuum of Care (CoC) plan submitted by Riverside County Department of Public Social Services to HUD on behalf of Housing and Homeless Coalition Steering Committee. The inventory included in the 2006 CoC Plan was broken out by Supervisorial District (see Appendix B). Countywide programs, and those operating in certain regions were allocated to each Supervisorial District based upon an equal share basis. With respect to the inventory or emergency shelter beds, this meant that each District was allocated a single family unit and two family beds along with nine year-round beds for individuals and 15 occasional voucher beds. Countywide transitional housing units were similarly reallocated with 8 beds for homeless individuals ascribed to each District. The allocation process for permanent supportive housing units was more complex because some programs operate in only certain portions of the County. Supportive housing units were therefore not reallocated on an equal basis. Rather these units were allocated to the Supervisorial Districts in close proximity to where each program operates. The results of this reallocation process appear in summary fashion in Table 6B. The District allocations resulted in a rounding problem evident in the totals, but the ﬁgures are sufﬁciently accurate for planning purposes. Table 6B summarizes the inventory of existing homeless housing resources by type and Supervisorial District. This table makes evident the highly variable distribution of residential programs for homeless persons in Riverside County. With the exception of the First District, which has a balanced inventory of homeless housing resources, none of the other Supervisorial Districts has a stock of housing consistent with an expectation of an even distribution of resources. The First District has between 24 percent and 28 percent of the 2Institute for Urban Research and Development, County of Riverside: County of Riverside 2004/2005 Homeless Assessment (2005). Section 6: Development Strategy for the County of Riverside 107 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY total inventory for each housing type in the grid. The Second District has between seven percent and 23 percent of the resources by type, being particularly under-represented with respect to permanent supportive housing. The Third District ranges are even more extreme with only one percent of the transitional housing and an only slightly higher percentage of supportive housing. The Fourth District is the most anomalous with the highest overall percentage of housing resources as well as having the largest inventory per housing type. Development of housing programs for homeless persons has clearly proceeded faster in the Fourth District than elsewhere. The Fifth District has the fewest resources to assist homeless persons, with only ﬁve percent of the overall inventory and less than eight percent of any single housing type. TABLE 6B: Summary of Homeless Housing Inventory by District Seasonal & Year Round Voucher Transitional Supportive TOTAL DISTRICT Emergency Emergency Housing Housing INVENTORY Shelter Shelter # % # % # % # % # % 1st 143 28% 95 24% 178 25% 95 30% 512 26% 2nd 62 12% 55 14% 167 23% 22 7% 306 16% 3rd 87 17% 27 7% 8 1% 65 21% 187 10% 4th 210 41% 215 53% 310 43% 113 36% 849 43% 5th 12 2% 12 3% 58 8% 17 5% 99 5% TOTAL 514 100% 404 100% 721 100% 312 100% 1,954 100% The inventory summarized in Table 6B was compared against the population of homeless persons in Riverside County to arrive at projections of need at the district-level. The County of Riverside commissioned a census of the homeless population that was conducted on January 1, 2005, so the data relied upon to assess need is relatively current. A total of 4,785 persons were found in Riverside County, of whom 3,131 were unsheltered and 1,854 were in shelters (or transitional housing programs). A District-level estimate of the homeless population was not included in the census, but an effort was made to summarize the numbers found in certain general regions. These regional counts have been reallocated by the author of this study to each of the Supervisorial Districts to better understand the relative distribution of homeless persons throughout the County. No attempt has been made to adjust allocations. Rather, each regional count was divided equally among the proximate districts. 108 Section 6: Development Strategy for the County of Riverside DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY TABLE 6C: Allocation of Regional Census of Homeless Persons to Supervisorial Districts SUPERVISORIAL DISTRICT Region # % Allocated 1st 2nd 3rd 4th 5th to: # % # % # % # % # % Western Metropolitan 2,110 44% 1,2 1,055 22% 1,055 22% I-15 Corridor 492 10% 1,2,3,5 123 3% 123 3% 123 3% 123 3% Mid County 717 15% 2,3,5 239 5% 239 5% 239 5% Desert & Coachella Valley 1,362 28% 4,5 681 14% 681 14% Blyth 104 2% 4 104 2% TOTAL 4,785 100% 1,178 25% 1,417 30% 362 8% 785 16% 1,043 22% GAP ANALYSIS BY SUPERVISORIAL DISTRICT Inventory 1,954 100% 512 26% 306 16% 187 10% 849 43% 99 5% Need Gap 2,869 100% 694 24% 1,114 39% 181 6% (66) -2% 947 33% Hosing Coverage Percentage 43% 22% 52% 108% 9% The reallocated census appears as Table 6C which indicates that over 50 percent of the homeless population can be found in the First and Second Supervisorial Districts. This should not be surprising as homelessness is largely an urban phenomenon resulting from inadequate social integration. Table 6C further indicates that the Third District has less than 10 percent of the total homeless population while the Fourth District has roughly 16 percent of the population. The Fifth Supervisorial District has just over 22 percent of the homeless population, which is consistent with the expectation that each district contains roughly 20 percent of the County’s population. Because the homeless census included both sheltered and unsheltered homeless persons, it is essential to take into account the extent to which the sheltered homeless population skews the results of the allocation matrix. In other words, each new shelter or program in a district would thereby increase the number of homeless persons in a particular district, so it is necessary to adjust for this by considering the role that the existing inventory plays in boosting the homeless count in a particular district. Table 6C includes a tabulation of the relative “demand” for homeless services against the available inventory of resources by district. The difference between the homeless population in a particular district and the available inventory describes a need gap that has been calculated both a numeric and percentage basis. The beneﬁt of considering the numeric difference between the number of homeless persons and the current inventory is that it begins to point to how much additional inventory should be developed in that district. Section 6: Development Strategy for the County of Riverside 109 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Table 6C indicates a need for 2,869 total new beds to accommodate the existing homeless population in Riverside County. The District percentages help to depict where program operators have been the most successful in beginning to address the problem of homelessness and which additional inventory is necessary to keep pace with the homeless population in a district. On a purely numeric basis, the First, Second, and Fifth Supervisorial Districts clearly have the greatest need for new residential resources for homeless persons. Combined, these districts would require 2,755 beds/units of housing to address the current need. The Fourth District, in contrast, has an inventory that exceeds its homeless population by 8%.3 In contrast, the Second, and Firth Supervisorial Districts are currently capable of accommodating 22 percent and nine percent, respectively, of their homeless populations. The Fifth Supervisorial District stands out owing to its very limited supply of residential options for homeless persons, with only 99 beds for over 1,000 persons. It should be noted that of the 99 beds in the Fifth District, 40 beds have been attributed to the District as a result of the reallocation methodology. The actual capacity to assist homeless persons in the Fifth Supervisorial District is probably even lower than is reﬂected in Table 6C. In summary, while there is a signiﬁcant gap in residential resources for homeless persons across the County of Riverside, the need is not distributed equally. The housing coverage percentage shown on the last row of Table 6C helps elucidate relative need. The lower the percentage, the greater the need, and conversely, the higher the percentage, the less the evident need for additional new services and resources. Of the ﬁve Supervisorial Districts, only one shows a modest excess inventory. A prudent development strategy would seek to moderate the extreme variability of resources across the County of Riverside so that residential services are accessible and relatively proximate to where the homeless populations are to be found. If this planning principal is adopted, it will mean stimulating growth of certain housing types in some districts, while capping or limiting growth in others. Given the dearth of permanent supportive housing 3 This does not mean that additional development may not be needed in the Fourth District, but that consider- able attention should be paid to the type of housing proposed for future development there and in all districts. The anomaly of an excess inventory may result from the fact that the census was conducted on January 26 at a time when weather-activated shelters were in operation, temporarily swelling the available resources beyond need (on that particular evening). It may also be the case, however, that the excess inventory is not an aberration at all, but is an accurate depiction of the empirical facts. The chart further indicates that the Third District has an inventory that is capable of accommodating half of the homeless population found there on any given night. 110 Section 6: Development Strategy for the County of Riverside DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY in contrast to the overwhelming need throughout the County, and the fact that a modest infrastructure of emergency and transitional housing resources already exists (except in Supervisorial District 5), the most reasonable strategy would be to focus considerable attention and resources on the development of permanent supportive housing irrespective of the district in which it is proposed. To rectify the apparent great need for emergency and transitional services in Supervisorial District 5, new development of these housing types should be focused there. Tables 6D.1 and 6D.2 summarize the relative need by housing type and Supervisorial District for the County of Riverside. Using the data in Table 6B, need was assessed as being either high, moderate or low depending on the following percentages: a) low need being attributed to inventories higher than 40%; b) moderate need being inventories above 10 percent but less than 40%; and c) high need being assigned to inventories capable of addressing less than 10 percent of the current need. While these priorities should be weighed against speciﬁc proposals to develop new housing resources, it would be unwise for the County to lock itself into a development strategy that limits growth only to where current housing resources are scarce. Rather, Tables 6D.1 and 6D.2 should be regarded as general guides to inﬂuence development decisions. Table 6D.2 depicts the summary information in ordinal fashion, which may be particularly useful to help determine the order and overall priority of projects. Table 6D.2 reemphasizes that both Supervisorial Districts 2 and 5 are relatively under-developed in terms of residential resources for homeless populations. Supervisorial District 4 has the most residential resources, both on a numeric and percentage basis. The residential resources of the Fourth Supervisorial District are more highly developed both in the aggregate, as well as for each residential type. The existing inventory in District 4 results in its being assigned the lowest overall rank in terms of future development to address need. Section 6: Development Strategy for the County of Riverside 111 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY TABLE 6D.1: Relative Need for Homeless Housing Resources, by Type and by Supervisorial District Year Round Voucher DISTRICT Emergency Emergency Transitional Supportive District Shelter Shelter Housing Housing Overview 1 MODERATE MODERATE MODERATE MODERATE MODERATE 2 MODERATE MODERATE MODERATE HIGH HIGH 3 MODERATE HIGH HIGH MODERATE MODERATE 4 LOW LOW LOW MODERATE LOW 5 HIGH HIGH HIGH HIGH HIGH Countywide LOW LOW LOW HIGH TABLE 6D.2: Supervisorial District Ranked by Relative Need for Types of Housing Resources Emergency Transitional Supportive District Shelter Housing Housing Overview Greatest Need 5 3 5 5 2nd Greatest Need 2 5 2 2 Mid-Range Need 3 2 3 3 Next to Lowest Need 1 1 1 1 Lowest Need 4 4 4 4 The considerable gap between the current inventory and existing need makes planning a critical undertaking because resources to both develop and to operate homeless housing are extremely limited. There is no question but that a strategy to provide shelter for all homeless persons—to create over 2,800 beds and/or units of housing—would be overly ambitious. The costs alone would greatly exceed available resources, requiring in excess of $1.1 billion over the next decade, even assuming per unit costs below $200,000. In addition to the capital needed to build facilities and permanent housing units, the annual operating support needed for 2,800 new beds would exceed the budget capacity of local governments, costing upwards of $30 million annually. 112 Section 6: Development Strategy for the County of Riverside DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY However, even a strategy of less than full implementation will require local ﬁnancial resources for development and ongoing operations. The analyst has assumed that 25 percent of all development costs will have to be borne locally.4 State and federal resources do not currently exist to pick up the balance of costs required to develop a full implementation model. Moreover, the HUD Continuum of Care (CoC) and the Mental Health Services Act are the only signiﬁcant operating support for homeless services from non-County sources. The County of Riverside has been successful over the past few years in competing for allocations from HUD of approximately $6 million, so this resource should be assumed to be available into the future. HUD CoC funds are currently used for a variety of purposes including grants to supportive housing programs for operations and supportive social services, rental assistance, and (rarely) for capital development. The majority of HUD CoC funds are used to renew existing programs for one year terms, so any expectation to access these funds for a new project would likely mean a commensurate reduction in services by an existing provider. Table 6F assumes that all funds for new operations and social services will be from local sources because so little room exists to expand programs within the CoC funding scheme. The one main exception to this is in the area of rental assistance where HUD has made new funds available for permanent housing developments for chronically homeless persons. The modest annual “bonus” to Riverside County that could be included in the plan as an available resource is approximately $1,100,000. The 2006 CoC funding cycle absorbed almost all of the remaining available allocation with an award of $913,000 to the County DPSS to develop 142 beds of transitional housing for homeless families (the MARB King Hall Transitional Housing Program). The limited availability of future development and operating resources from HUD has been taken into account in the production plan that follows. If used exclusively as rental assistance, the roughly $1.1 million in annual “bonus” funding would result in either 32 single room occupancy units or 24 efﬁciency units at the current Fair Market Rents.5 If production of permanent supportive housing were limited by the availability of rental assistance from HUD 4Most developments ﬁnanced with Low Income Housing Tax Credits require close to 30%local government support to be feasible. 5HUD Fair Market Rents can be found at www.huduser.org/datasets/fmr/fmrs/2007. The current FMR for an efﬁciency unit in Riverside County is $765. An SRO is calculated at 75 percent of an efﬁciency unit, or $574 at current rates. Section 6: Development Strategy for the County of Riverside 113 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY through the Continuum of Care process, it would take nearly 80 years to develop the 1,825 units needed to close the gap so that all homeless persons in need could access housing. The development strategy included here looks to the horizon in spans of 5-years and 10-years. For planning purposes, the strategy proceeds with the assumption that local funds will be made available at 58 percent of the level of funding that HUD provides to programs within the County. With a commitment of funds at this level, there would be approximately $10 million available each year to develop new resources and support the operations of programs to be developed as per the following: 2006 Continuum of Care Plan Award to Riverside $ 6,311,803 Rounded $ 6,300,000 58% Local Government Commitment $ 3,700,000 TOTAL Proposed $10,000,000 The discussion that follows shows how $10 million a year could be leveraged to develop new housing programs to assist homeless persons. The plan employs a methodology that seeks to maximize the leverage capacity of local government funds, thereby minimizing the demands placed on local resources and maximizing the impact of these funds. To this end, the following strategy has been employed: • The highest priority for HUD CoC funds shall be as rental assistance or operating subsidies o Rationale: a) a number of local and state resources are available to acquire sites and construct facilities or housing, so limited CoC funds should not be treated as a potential development resource; and b) the most difﬁcult local resource to obtain is rental assistance and/or operating support which is needed to bridge the gap between the limited rent generated by the extremely low-income (homeless) residents and annual operating costs. • Developers shall seek to maximize the leverage potential of capital contributions from local government sources shall with State and/or federal funds (including low-income housing tax credits). o Rationale: the affordable housing needs of the County of Riverside extend well beyond the problem of homelessness (which is merely its most visible dimension); affordable housing needs to be developed to assist other low-income populations work their way out of poverty. 114 Section 6: Development Strategy for the County of Riverside DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Section 3 of this report includes a number of capital and operating budgets for a range of homeless housing developments. The development of new emergency housing has been excluded from the analysis for two reasons. Firstly, the need itself has been determined to be less than that of transitional and permanent supportive housing. Secondly, there are hardly any resources at the state and federal levels to develop and operate new emergency shelters; thus the costs must be borne almost exclusively by local sources. This means that the development principal of leveraging local resources is violated, and the development of new emergency shelters would pose a considerable challenge in Riverside County. Consequently, the development focus in Riverside County over the upcoming several years will likely be upon supportive housing and family transitional housing. Table 6E shows in ﬁve-year increments the probable demand upon local capital resources to develop supportive housing for disabled individuals and transitional housing for families. The plan shows that 40 units of family transitional housing and 175 units of supportive housing would require over $60 million over the next decade. Of this sum roughly $21 million (representing 35 percent of costs) would likely have to come from local sources. These sources could be a combination of city, county, and redevelopment sources. Local sources would thus leverage roughly $40 million, a nearly 3:1 ratio, resulting in 215 new units of housing to address the problem of homelessness in Riverside County. To operate these units will require additional local support, although some new State funding will be available through the Mental Health Services Act. HUD Continuum of Care funds have been almost entirely allocated, with the exception of annual “bonus” funding used as rental assistance for chronically homeless persons (see Section 3 for a discussion of the Continuum of Care). The budget in Table 6F assumes that some new rental assistance vouchers will be made available through the CoC process. If this assumption does not materialize, the rental revenues will be insufﬁcient to operate the housing, and demands will be placed upon local funding sources to sustain operations. Taking inﬂation and the rate of growth into account, by year ten the annual operating assistance required to maintain the proposed 215 units of housing will be in excess of $870,000. Given that the HUD Continuum of Care has already been allocated and existing grantees receive only one year renewal funding, the assumption is that these expenses will be covered by local sources. Among the likely sources would be a combination of the following: Section 8 rental assistance (from the Housing Authority); CDBG (from local government entitlement jurisdictions); Mental Health Services Act; or general revenues. Section 6: Development Strategy for the County of Riverside 115 116 TABLE 6E: Proposed Capital Investment Plan: Local Sources for Homeless Housing, by Type Total Development Costs Local Share of Costs Family SRO Cost Per Years Project Type Location TH Units Units Inflator Unit to Dev. 2007 - 2011 2012 - 2016 2007 - 2011 2012 - 2016 Total SRO Sup. Dist. 5 50 4% $232,000 3 $11,600,000 $4,060,000 $4,060,000 SRO Sup. Dist. 2 75 4% $269,120 6 $10,092,000 $10,092,000 $3,532,200 $3,532,200 $7,064,400 SRO Sup. Dist. 3 50 4% $312,179 9 $15,608,960 $5,463,136 $5,463,136 Family TH Sup. Dist. 2 40 4% $336,000 10 $13,440,000 $4,704,000 $4,704,000 Capital Contributions $7,592,200 $13,699,336 $21,291,536 TOTAL 40 175 $21,692,000 $39,140,960 $60,832,960 Leverage Ratio: 2.86 TABLE 6F: Local Operating Assistance (in addition to HUD CoC Operating Assistance) COLA: 103.5% Year Project Units 3 4 5 6 7 8 9 10 Total SRO 50 $60,000 $62,100 $64,274 $66,523 $68,851 $71,261 $73,755 $76,337 $543,101 SRO 75 $66,523 $68,851 $71,261 $73,755 $76,337 $356,728 SRO 50 $73,755 $76,337 $150,092 Family TH 40 $642,000 $642,000 Local Operating Support $60,000 $62,100 $64,274 $133,046 $137,703 $142,522 $221,266 $871,010 $1,691,921 Section 6: Development Strategy for the County of Riverside DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The development goals included in this report are modest in that the new units will accommodate only 7.5 percent of the existing need, deﬁned as 2,869 units (see above in Table 6C). There are two primary reasons why less than 10 percent of the existing need is proposed for development in this planning guide. Firstly, as noted previously, new development of housing for homeless persons and families is limited by the availability of operating subsidies. This report assumes that it would be extremely challenging to obtain local rental assistance subsidies for permanent housing, and more general grant support for any proposed transitional housing or emergency shelter. New development is thus largely limited to availability of new resources from the annual HUD Continuum of Care process. These resources are modest (roughly 25 certiﬁcates a year) and are accessible only once a year thereby prolonging development timeframes. A second reason that this analysis assumes modest development goals is that Riverside County currently lacks the requisite capacity to undertake the development (and management) of complex projects. Only a handful of not-for-proﬁt developers possess the interest and experience to develop homeless housing, particularly supportive housing. Thus, until additional capacity is developed or supported, it is unlikely that projects will move far beyond the conceptual stage to become actual resources. In order to grow capacity, it may be useful to allocate resources for technical assistance, training, and organizational development so that agencies may plan for new housing resources. It should be noted that while there is general development capacity for affordable housing development throughout Riverside County, hardly any developer has created new units that are affordable to persons leaving homelessness. Recognizing that new development will likely be limited by available rental assistance in the near future, a number of other strategies may be employed to create new affordable units for persons emerging from homelessness. The following policy recommendations have been proposed to stimulate the growth of housing for homeless persons and families. Section 6: Development Strategy for the County of Riverside 117 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY POLICY RECOMMENDATIONS: 1. Policies shall be developed to build the capacity (including facilitating the creation of joint ventures) and to minimize the risk to nonproﬁt agencies to undertake the development of affordable housing for homeless populations. Rationale: there is a dearth of development experience among non-proﬁt social service agencies, yet such agencies generally provide the impetus for new housing programs for homeless populations. These agencies lack the capacity and the resources to undertake the considerable risks associated with the development of affordable housing. A forgivable pre-development loan fund would shift the early risk of projects from the nonproﬁt sponsor to the local government, thereby serving as a spur to development. In addition to creating incentives to develop homeless housing, an effort will need to be made to increase the skills of providers so that they may undertake development expeditiously. 2. Policies should be developed that will encourage development of new resources in service- poor areas and to limit future development in areas rich in residential resources. Rationale: homeless resources have been developed unevenly throughout the County. An effort should be made to establish greater equilibrium so that programs and services are available to reach all at-risk populations. 3. Policies should be developed to integrate homeless populations into the social mainstream, including in residential developments. Rationale: the burden to develop and manage housing for homeless populations should not fall exclusively upon the small number of developers who have created units for homeless populations. Rather, an effort should be made to create incentives for all housing developers to integrate a limited number of (formerly) homeless persons into their projects. This may be accomplished by using fee-waivers and providing other incentives to developers who not only set-aside units for low-income households but make the extra effort to market units to persons leaving homelessness. The approach to planning incorporated in the Destination Home guide incorporates the basic principals of public health planning, namely, to assure, to the extent possible, that all populations have access to appropriate and cost-effective care and housing, and that the 118 Section 6: Development Strategy for the County of Riverside DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY basic system of care is organized so that no one is forced to become homeless in order to receive care. This approach tacitly promotes the idea that prevention services need to be developed alongside resources that provide emergency and long-term care. The approach also assumes that evaluation mechanisms will be built into the service-delivery system and that ongoing assessments may be made of the plan’s implementation. Any system of care so designed will seek to have baseline level services available throughout the County so that a person or family may access them expeditiously. This is also critical in order to reduce the amount of time that a person or family experiences homelessness. Thus, it is important that new residential services be sited in areas now lacking sufﬁcient resources to assist the current and anticipated future homeless population. To the extent that a community’s services lag as compared to other areas, special attention should be paid to that locality. The implementation of a strategy to develop housing for homeless populations should include an expectation that units will be created within a set timeframe. Resources to build new shelter and programs seem plentiful enough, but the funding needed to operate the housing is limited, thereby constraining new development. Without allocation of new local resources as operating subsidies and rental assistance, development will continue to lag behind need. The short supply of resources places added emphasis on the question of where new homeless resources should be located. Prior development of homeless programs and services has been uneven across Riverside County, leaving signiﬁcant gaps in certain Supervisorial Districts. Thus, the performance goal should be to see that a baseline set of services is made available in each community, and that enhanced services are created as opportunities arise. It therefore seems prudent to monitor performance less in terms of total units to be developed (which is largely limited by the availability of external resources) and more upon a variable over which there exists a measure of local control—the location of new housing for homeless persons. In part, location may be driven by opportunity, but establishing performance goals that prioritize where new housing and resources are most needed will serve the County’s needs better in the long-run. Tables 6D.1 and 6D.2 provide direction to local planners on the question of where to site new residential opportunities. Maintaining consistency with the priorities identiﬁed in these tables will strengthen and enhance the continuum of care as new resources are brought online in Riverside County. Section 6: Development Strategy for the County of Riverside 119 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY A APPENDIX T he Resource Grid that follows was created to provide an overview of the predominant resources used to develop and operate housing for homeless populations. The Resource Grid also includes a summary of the primary sources used to provide supportive social services to homeless persons. The Resource Grid is divided into three parts: Development, Operations, and Social Services. Each section contains information on the name of each program or resource, its funding source and the administrative agencies involved in its allocation and compliance. Program due dates and the most recent information on the level of funding available are also included in each section, except due dates are excluded for most programs allocated through block grants. Each section also includes a description of the eligible uses of the funds, the eligible populations to be served, match requirements (if any) and the source of the regulations governing the resource. A key appears on the bottom of each page of the grid to help identify the eligible population. Explanatory notes also appear on each page. The pages that follow the Resource Grid in Appendix A provide detailed summaries of each source and how it may be used. These resources appear in alphabetical order and are indexed. A-1 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The Resource Grid may be used as a starting place to understand the range of funding available to address the needs of a speciﬁc population or to develop a type of housing. It is intended as tool to guide understanding and direct attention to parties interested in a speciﬁc facet of development related to homelessness. A-2 RESOURCES FOR THE DEVELOPMENT AND OPERATION OF HOMELESS HOUSING AND PROGRAMS Eligible Uses Current Funding Typical Due Date(s) Level Eligible Use of Funds Development (in millions) DEVELOPMENT ACTIVITIES HOUSE TYPES New Permanent Emergency Transitional Permanent Supportive Required Program Source Administration Acquisition Pre-development Rehabilitation Construction Financing Shelter Housing Housing Housing Population(s) Match Regulations Affordable Housing Program (AHP) Federal Home Federal Home April & October $20 - $30 per round x x x x x x x all 12 CFR Part 951 Loan Bank Loan Bank Community Development HUD EDA local determination See Table X.X x x x x x x x x x all 24 CFR Part 570 Block Grant (CDBG) Emergency Housing and State bond Cal. HCD/DPSS January/February $31 x x x x x x x all Title 25, §7950 Assistance Program– (EHAP-CD) measure Priority-setting Federal Emergency Shelter Grant (ESG) HUD HUD/EDA local determination $0.6 x x x x all 100% 24 CFR Part 576 Governor’s Homeless Initiative (GHI) State bond Cal. HCD open enrollment $42 x x see Note 1 Title 25, §7300 measure & §8300 HOME Investments Partnership HUD EDA local determination $6.3 x x x x x x x x all 25% 24 CFR Part 92 Program (HOME) Housing Enabled by Local Partnerships CalHFA CalHFA October revolving loan x x x x x x all State Chartered Program (HELP) Bank Housing Opportunities for Persons with HUD City of Riverside local determination $1.7 x x x x x x x x HIV 24 CFR Part 574 AIDS (HOPWA) Low Income Housing Tax Credit (LIHTC) Federal/State CTCAC March & July $700 9% Federal x x x x x x x all Title 4, §10300 $320 State Multifamily Housing Program (MHP) State bond Cal. HCD February/August $30 - $40 x x x all Title 25, §7300 measure pre round & §8300 Residential Development Loan CalHFA CalHFA October revolving loan x x x x x x x x all State Chartered Program (RDLP) Bank Redevelopment Housing Set-aside Redevelopment Redevelopment October revolving loan x x x x x x x x x all CA H & S Code Agencies Agencies §33000 Special Needs Housing Finance Program CalHFA CalHFA open enrollment revolving loan x x x x x x x x all State Chartered Bank Supportive Housing Program – HUD HUD / DPSS June $0.4 per project x x x x x x see Note 2 100% 24 CFR Part 583 McKinney Vento (SHP) Supportive Housing Program (SHP) State bond Cal. HCD open enrollment $37 x x see Title 25, §7300 measure Note 3 & §8300 Supportive Housing Program for Persons HUD HUD May/June $5 in So. Cal. x x x x x x special needs 24 CFR Part 891 with Disabilities (811) Tax Exempt Bonds–(Bonds for 501c3 Federal/State CDLAC open enrollment open enrollment x x x x x x x x all 26 U.S.C. Section Charitable Organizations) 145 Rental Projects 147 Title V Program HUD & HHS HUD & HHS variable open enrollment excess federal property deeded or leased to eligible x x x x all 24 CFR 581 VA Grant Program DVA DVA June varies x x x x x x x VETS 35% 38 CFR Part 61 CODE TO SUB-POPULATIONS NOTES SMI = Serious Mental Illness 1 Chronic Homeless = disabled with income below 30% AMI & eligible for MHSA services. SA = Substance Abuse 2 All populations may be served, permanent supportive housing may only be occupied by disabled homeless persons. HIV = HIV & AIDS DD = Developmental Disability 3 HCD defines special needs as: homeless or at-risk of homelessness (incomes below 20% St. Median Income or AMI CH = Other Chronic Health Condition (eg. Hep-C) w/o rental subsidy. Eligible disabled populations include: CMI, HIV, SA, DD, CH. VETS = Veterans A-3 RESOURCES FOR THE DEVELOPMENT AND OPERATION OF HOMELESS HOUSING AND PROGRAMS Eligible Uses Current Funding Typical Due Date(s) Level Eligible Use of Funds Operations (rounded) OPERATING SUBSIDIES Homeless Operating Rental Property Emergency Transitional Permanent Supportive Required Rental Assistance and Subsidy Programs Prevention Assistance Assistance Leasing Shelter Housing Housing Housing Population(s) Match Regulations Emergency Food and Shelter Program FEMA DPSS $873,000 x x x Emergency Housing and Assistance Cal HCD DPSS $151,000 x x x x Title 25, §7950 Program–Operations Federal Emergency Shelter Grant (ESG) HUD–McKinney-Vento EDA $591,000 x x x 100% 24 CFR Part 576 Housing Opportunities for Persons with HUD HUD/City of Riverside $1,684,000 x x x x HIV 24 CFR Part 574 AIDS (HOPWA) HUD-VA Supported Housing (VASH) Program HUD/DVA HUD/DVA no new funding x x x VETS /SMI 24 CFR Part 982 Public Housing HUD EDA n/a affordable rental housing x x 24 CFR Part 902 et seq. Section 8 Housing Choice Voucher Program HUD/EDA Public Housing Authorities x x x 24 CFR Part 982 Section 8 Moderate Rehabiltiation for SROs HUD–McKinney-Vento Public Housing Authorities part of Continuum- x x x 24 CFR Part 882 of-Care process Shelter Plus Care Program HUD–McKinney-Vento Public Housing Authorities June part of Continuum- x x x SMI/SA/ 100% 24 CFR Part 882 of-Care process HIV/CH Supportive Housing Program – HUD–McKinney-Vento HUD/DPSS June part of Continuum- x x x x 25% 24 CFR Part 583 McKinney Vento (SHP) of-Care process Transitional Living Program for HHS HHS unknown not funded in 2006 x x x x Youth (16-21) 10% Transitional Living Older Homeless Youth (TLP) Program through the Runaway, Homeless, and Missing Children Protection Act of 2003, as amended by P.L. 108-96 VA Homeless Providers Per Diem Program DVA DVA June $29.31 per unit/day x x x VETS 50% 38 CFR Part 61 CODE TO SUB-POPULATIONS SMI = Serious Mental Illness SA = Substance Abuse HIV = HIV & AIDS DD = Developmental Disability CH = Other Chronic Health Condition (eg. Hep-C) VETS = Veterans A-5 RESOURCES FOR THE DEVELOPMENT AND OPERATION OF HOMELESS HOUSING AND PROGRAMS Eligible Uses Typical Current Funding Due Date(s) Level Eligible Use of Funds Supportive Social Services FUNDING FOR SOCIAL SERVICES Mental Substance Employment Case Medical Life Required Social Services Funding Health Abuse Assistance Transportation Management Serv./AIDS Skills Childcare Other Population(s) Match Regulations FORMULA / BLOCK, GRANTS AB2034 Cal. DMH RBHD $1.7 million x x SMI Child Care & Development Block Grant (CCDB) HHS Cal DSS, DOE x families 45 CFR Parts 98 & 99 Community Development Block Grant (CDBG) HUD EDA $18.5 million x x x x x x x all 24 CFR Part 570 Community Mental Health Services Block Grant (CMHS) HHS Cal. Dept. of MH x x x x x x SMI 45 CFR Part 96 Community Services Block Grant (CSBG) HHS Cal HCD $378,000 x x x x x x all 45 CFR Part 96 Education for Homeless Children and Youth DoE Cal. DoE $250,000 x x 34 CFR Part 74 Federal Emergency Shelter Grant (ESG) HUD EDA $591,000 x x all 100% 24 CFR Part 576 Housing Opportunities for Persons with AIDS (HOPWA) HUD HUD $1.7 million x x x x x x x x HIV 20% 24 CFR Part 574 Medicaid (MediCal) SSA SSA x x x x SMI, HIV 50% 42 CFR Subchapter C Mental Health Services Act (Prop. 63 or MHSA) Cal. DMH RBHD $23 million x x x x x x x x SMI Projects for Assistance in Transition from Homelessness (PATH) HHS/SAMHSA Cal Dept. of MH $226,000 x x x x x x x SMI, SA 25% 42 CFR Subchapter C Ryan White Cal. DH RHD $6.3 million x x x x x x x x HIV PHS Grants Policy Statement, DHHS (OASH) Publication No. 94-50,000, (Rev.) April 1, 1994. Social Services Block Grant (SSBG) HHS Cal DSS x x x x x all 45 CFR Part 96 Substance Abuse Prevention & Treatment Block Grant (SAPT) HHS Cal. Dept. of MH $3.5 million x x x x x x SA 45 CFR Part 96 Temporary Assistance for Needy Families (TANF/CalWORKS) SSA DPSS $17.3 million x x x x x x x x 50% CATEGORIAL FUNDING Emergency Housing and Assistance Program – (EHAP) State bond Cal. HCD / DPSS November $150,884 x x all Title 25, §7950 measure Health Care for the Homeless HHS unknown variable x x x x x 52 CFR Part 32347 Minority SAP & HIV Prevention Services Program HHS HHS Fall variable x x x x HIV 45 CFR Parts 74 & 92 Supportive Housing Program – McKinney Vento (SHP) HUD HUD / DPSS June $6 million x x x x x x x x all 24 CFR Part 583 Targeted Capacity Expansion (TCE) HHS HHS Fall variable x SA 45 CFR Parts 74 & 92 Transitional Living Program for Older Homeless Youth (TLP) HHS HHS unknown not funded x x x x x x x x x Youth (16-21) 10% Transitional Living in 2006 Program through the Runaway, Homeless, and Missing Children Protection Act of 2003, as amended by P.L. 108-96 Treatment for Homeless Persons HHS Cal. Dept. May variable x x x x x x SA 45 CFR Parts 74, of Health 45 & 92 VA Homeless Providers Per Diem Program DVA DVA June variable x x x x x x x x x VETS 50% 38 CFR Part 61 CODE TO SUB-POPULATIONS SMI = Serious Mental Illness SA = Substance Abuse HIV = HIV & AIDS DD = Developmental Disability CH = Other Chronic Health Condition (eg. Hep-C) VETS = Veterans A-7 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY McKinney-Vento Homeless Assistance Act .......................................................A-11 Development Affordable Housing Program (AHP) .........................................................................A-19 Community Development Block Grant (CDBG) ......................................................A-21 Emergency Housing and Assistance Program–(EHAP-CD)......................................A-29 Emergency Shelter Grant (ESG)................................................................................A-33 Governor’s Homeless Initiative (GHI) .......................................................................A-40 HOME Investments Partnership Program (HOME) .................................................A-49 Housing Enabled by Local Partnerships Program (HELP) ........................................A-52 Housing Opportunities for Persons with AIDS (HOPWA).......................................A-55 Low Income Housing Tax Credit (LIHTC) ...............................................................A-63 Multifamily Housing Program (MHP).......................................................................A-93 Redevelopment Housing Set-aside ............................................................................A-102 Special Needs Housing Finance Program ..................................................................A-120 Supportive Housing Program – McKinney Vento (SHP)..........................................A-122 Supportive Housing Program/Multifamily Housing Program (SHP/MHP) ..............A-128 Supportive Housing Program for Persons with Disabilities (811) .............................A-133 Tax Exempt Bonds – Qualiﬁed Residential Rental Projects .......................................A-142 Tax Exempt Bonds – (Bonds for 501c3 Charitable Organizations) ...........................A-140 Title V Program .........................................................................................................A-151 VA Grant Program......................................................................................................A-160 Operations/Rental Assistance and Subsidy Programs Emergency Food and Shelter Program.......................................................................A-26 Emergency Housing and Assistance Program–Operations........................................A-31 Federal Emergency Shelter Grant (ESG) ...................................................................A-33 Housing Opportunities for Persons with AIDS (HOPWA).......................................A-55 HUD-VA Supported Housing (VASH) Program .......................................................A-59 Public Housing...........................................................................................................A-100 Section 8 Housing Choice Voucher Program............................................................A-115 A-9 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Section 8 Moderate Rehabiltiation for SROs.............................................................A-117 Shelter Plus Care Program ........................................................................................A-119 Supportive Housing Program – McKinney Vento (SHP)..........................................A-123 VA Homeless Providers Per Diem Program ...............................................................A-160 Supportive Social Services—Formula/Block Grants AB2034.......................................................................................................................A-17 Child Care & Development Block Grant (CCDB) ....................................................A-34 (See Federal Block Grant Assistance) Community Development Block Grant (CDBG) ........................................................A-21 (See Federal Block Grant Assistance) Community Mental Health Services Block Grant (CMHS)......................................A-35 (See Federal Block Grant Assistance) Community Services Block Grant (CSBG) (See Federal Block Grant Assistance) ........A-36 Education for Homeless Children and Youth ............................................................A-23 Housing Opportunities for Persons with AIDS (HOPWA).......................................A-56 Medicaid (MediCal)...................................................................................................A-73 Mental Health Services Act (Prop. 63 or MHSA) .....................................................A-84 Minority Substance Abuse Prevention and HIV Prevention Program.......................A-89 Projects for Assistance in Transition from Homelessness (PATH).............................A-97 Ryan White ................................................................................................................A-106 Social Services Block Grant (SSBG)...........................................................................A-37 Substance Abuse Prevention & Treatment Block Grant (SAPT) ...............................A-38 (See Federal Block Grant Assistance) Targeted Capacity Expansion or TCE........................................................................A-136 Temporary Assistance for Needy Families (TANF/CalWorks)...................................A-145 Supportive Social Services–Categorical Funding Emergency Housing and Assistance Program – (EHAP) ...........................................A-31 Federal Emergency Shelter Grant (ESG) ...................................................................A-33 Health Care for the Homeless ...................................................................................A-45 Supportive Housing Program – McKinney Vento (SHP)..........................................A-123 Treatment for Homeless Persons................................................................................A-155 VA Homeless Providers Per Diem Program ...............................................................A-160 A-10 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY At the beginning of the Reagan Presidency, most programs to address problems associated with homelessness were created, funded and administered at the grass-roots level. In the view of the administration, states and local jurisdictions were best equipped to handle the problem of homelessness. In 1983, in response to growing concerns from the US Conference of Mayors (and other advocacy groups), the Federal government creates the ﬁrst task force on homelessness. The initial federal response was to make available surplus federal property to localities through the Title V program. In 1986 Congress took up the Homeless Persons’ Survival Act and the Urgent Relief for the Homeless Act (URHA), each providing emergency relief provisions for shelter, food, mobile health care, and transitional housing. These acts passed Congress with large bipartisan majorities in both houses of Congress in 1987. After the death of the chief Republican sponsor of the URHA, Representative Stewart B. McKinney of Connecticut, the act was renamed the McKinney-Vento Homeless Assistance Act. It was signed into law by President Reagan on July 22, 1987. The McKinney Act originally consisted of 15 programs providing a range of services to homeless people, including the Continuum of Care Programs: the Supportive Housing Program, the Shelter Plus Care Program, and the Single Room Occupancy Program, as well as the Emergency Shelter Grant Program. These programs are all contained within Title IV. • Title I of the McKinney Act includes a statement of six ﬁndings by Congress and provides a deﬁnition of homelessness. • Title II establishes and describes the functions of the Interagency Council on the Homeless, an independent entity within the Executive Branch composed of the heads of 15 federal agencies. • Title III of the McKinney Act authorizes the Emergency Food and Shelter Program, which is administered by the Federal Emergency Management Agency (FEMA). • Title IV authorizes the emergency shelter and transitional housing programs administered by the Department of Housing and Urban Development, including the Emergency Shelter Grant program (expanded from the program created by the Homeless Housing A-11 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Act in 1986), the Supportive Housing Demonstration Program, Supplemental Assistance for Facilities to Assist the Homeless, and Section 8 Single Room Occupancy Moderate Rehabilitation. • Title V of the McKinney Act imposes requirements on federal agencies to identify and make available surplus federal property, such as buildings and land, for use by states, local governments, and nonproﬁt agencies to assist homeless people. • Title VI authorizes several programs administered by the Department of Health and Human Services. • Title VII authorizes several programs administered by the Department of Education, the Department of Labor and the Department of Health and Human Services. • Title VIII amends the Food Stamp program to facilitate participation in the program by persons who are homeless, administered by the Department of Agriculture. • Title IX of the McKinney Act extends the Veterans Job Training Act. Though amended several times since its passage, the McKinney Act has stood the test of time, and provides the best ﬁrst step to address the needs of a population that is, by and large unknown and underrepresented. TITLE 42, CHAPTER 119, SUBCHAPTER I, § 11302: General deﬁnition of homeless individual (a) In general For purposes of this chapter, the term “homeless” or “homeless individual or homeless person”  includes— (1) an individual who lacks a ﬁxed, regular, and adequate nighttime residence; and (2) an individual who has a primary nighttime residence that is— (A) a supervised publicly or privately operated shelter designed to provide temporary living accommodations (including welfare hotels, congregate shelters, and transitional housing for the mentally ill); A-12 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY (B) an institution that provides a temporary residence for individuals intended to be institutionalized; or (C) a public or private place not designed for, or ordinarily used as, a regular sleeping accommodation for human beings. (b) Income eligibility (1) In general A homeless individual shall be eligible for assistance under any program provided by this chapter, only if the individual complies with the income eligibility requirements otherwise applicable to such program. (2) Exception: Notwithstanding paragraph (1), a homeless individual shall be eligible for assistance under Title I of the Workforce Investment Act of 1998 [29 U.S.C. 2801 et seq.]. (b) Exclusion For purposes of this chapter, the term “homeless” or “homeless individual” does not include any individual imprisoned or otherwise detained pursuant to an Act of the Congress or a State law. Over the past few years, HUD has narrowed the eligibility of different homeless sub- populations, arriving at the following more limited deﬁnition in Fiscal Year 2006: A person is considered homeless only when he/she resides in one of the three places described below. For new and renewal projects, persons assisted with permanent housing must be homeless and come from: 1. places not meant for human habitation, such as cars, parks, sidewalks, and abandoned buildings; 2. an emergency shelter; or 3. transitional housing for homeless persons and who originally came from the streets or emergency shelter. If a person is in one of the three categories listed above, but most recently spent less than 30 days in a jail or institution, he/she qualiﬁes as coming from one of these three categories. A-13 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY In addition to the above three categories, projects providing Transitional Housing, Safe Havens (non-PH), or Supportive Services Only may also serve populations meeting the following: 4. eviction within a week from a private dwelling unit and no subsequent residence has been identiﬁed and the person lacks the resources and support networks needed to obtain housing; or 5. discharge within a week from an institution in which the person has been a resident for 30 or more consecutive days and no subsequent residence has been identiﬁed and he/she lacks the resources and support networks needed to obtain housing. By law, only those persons who are homeless may be served by the programs under the Continuum of Care NOFA. Persons at risk of homelessness (persons who are “doubled up,” or persons who are “near homelessness”) are eligible for assistance through the Emergency Shelter Grants (ESG) program that can fund homelessness prevention activities. A variety of other programs, such as Section 8, Community Development Block Grant (CDBG) and HOME, also serve low-income persons who may be at risk of becoming homeless due to poor housing conditions, overcrowding or other reasons. Owing to the high demand for federal assistance to homelessness and Congress’ reluctance to authorize funding beyond $1.3 billion annually, HUD has felt forced to increasingly target its funds. Recent regulatory changes have focused HUD McKinney-Vento funds in three signiﬁcant ways: (1) HUD has prioritized the use of its funds to assist “chronic homeless persons,” (2) HUD has encouraged localities to use McKinney-Vento funding to develop permanent housing, and as a corollary (3) HUD has begun to downplay the role of transitional housing programs as necessary steps in the process by which persons “recover” from homelessness. HUD deﬁnes a “chronic homeless” individual as: an unaccompanied homeless individual with a disabling condition who has either been continuously homeless for a year or more OR has had at least four (4) episodes of homelessness in the past three (3) years. In order to A-14 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY be considered chronically homeless, a person must have been sleeping in a place not meant for human habitation (e.g., living on the streets) and/or in an emergency homeless shelter.” A disabling condition is deﬁned as “a diagnosable substance use disorder, serious mental illness, developmental disability, or chronic physical illness or disability, including the co-occurrence of two or more of these conditions.” A disabling condition limits an individual’s ability to work or perform one or more activities of daily living. An episode of homelessness is a separate, distinct, and sustained stay on the streets and/or in an emergency homeless shelter. A chronically homeless person must be unaccompanied and disabled during each episode. To be deﬁned as chronically homeless, a person must be living on the street or in emergency shelter at the time of the count or eligibility determination. The deﬁnition does not include those currently in transitional housing. There are a number of key elements to this deﬁnition that are important to note. First, a chronic homeless person is a single (adult) person with a disability. Second, to be considered “chronic,” the homeless person has been either on the streets or in emergency shelters. This is a much narrower deﬁnition of homelessness than HUD typically uses, as it disqualiﬁes any persons leaving either institutional settings, or a transitional housing program. Homeless persons graduating from a transitional housing program may still be eligible for other programs and purposes, but they are excluded from projects targeted to chronic homeless persons. There is one other dimension to this deﬁnition that bears noting: that the deﬁnition itself tacitly endorses a “housing ﬁrst” model. If one may not move a chronic homeless person from transitional housing into permanent housing, then a program necessarily is forced to identify prospective tenants from emergency shelters or the streets. Finally, it is important to recognize that the deﬁnition of chronic homelessness excludes families. A-15 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Agency Name: Riverside County Department of Mental Health, 3600 Lime Street, Building 5, Suite 500, Riverside, CA 92501, (909) 341-6620. Program Coordinator: Maria Marquez (909) 358-4523, email@example.com Recent estimates indicate that there are approximately 300,000 homeless persons in California including 50,000 with serious mental illness. Approximately 5,000 of these persons are served throughout the state in 34 local programs established initially under Assembly Bill 34, and expanded under Assembly Bill 2034. (Steinberg, Chapter 617 and 518, Statutes of 1999 and 2000). In 1999 the Governor provided $10 million for three pilot programs to provide comprehensive, integrated services to homeless adults with serious mental illness with the condition that no future funding would be provided unless the three projects could demonstrate positive client and system outcomes, including cost effectiveness, within that ﬁrst year. As documented in the May 2000 report to the Legislature on the effectiveness of these programs, these three pilot projects located in Sacramento, Stanislaus and Los Angeles, were very successful in reducing the number of homeless days, jail days and psychiatric hospital days experienced by individuals enrolled in the programs. As a result of those early outcomes funding was increased to $54.9 million to support 34 local programs. State funding provided for these programs enables staff to directly or indirectly provide a comprehensive array of services including outreach, supportive housing and other housing assistance, employment, substance abuse, and mental and physical healthcare including medications. The ﬂexibility of the funding provided has made it possible for programs to provide and subsidize housing and deliver the comprehensive services necessary to support individuals living and working in the community. What has become apparent to providers and stakeholders is the therapeutic signiﬁcance of having a stable place to live, and the foundation this provides for individuals’ ability and desire to make progress in other aspects of their lives. A-16 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The individuals served in these programs are nearly always persons with multiple challenges including mental illness, substance abuse issues, criminal justice issues, HIV/AIDS, and other physical disabilities. Additionally many have been homeless a long time, sometimes more than a decade. They often have no ties to family and rarely have any resources. Many will not utilize programs that require sobriety at admission. In short, these are individuals for whom traditional programs have not produced long-term solutions to homelessness. With almost ﬁve years since initial program funding was provided, the success of AB 2034 programs over time continues to exceed expectations. Recent data on individuals who have been in the program three years or more demonstrate that their positive outcomes have been sustained and improved over time. The outcomes described in each annual legislative report on the effectiveness of these programs document not only the personal success of individuals dealing with multiple challenges, but also the ongoing cost effectiveness of AB 2034 programs statewide. Program Overview The County of Riverside receives an allocation of approximately $1.6 million annually from the State of California, Department of Mental Health through the AB2034 program. The AB 2034 Homeless Assistance Program is designed to meet the long-term service needs of homeless adults suffering from mental illness in Riverside County. Riverside County covers a wide geographic area, bordering on Orange County in the west and stretching eastward all the way to the state line. The Homeless Assistance Program offers services in all regions of the county, with specialized teams out-stationed to remote areas. The teams are made of a combination of skilled professional and paraprofessional members who work together to meet the needs of our consumers. While recognizing that each consumer has their own unique strengths and needs, the program endeavors to assist all consumers in achieving three primary goals: • Safe, secure, and stable housing. • Appropriate mental health treatment, including medications. • Participation in meaningful activity, such as employment, education, or volunteering. The program relies heavily on community and inter-agency support. For that reason we maintain ongoing relationships with local public, private, and nonproﬁt agencies in order to provide a wide spectrum of services for our consumers. Program enrollees have become involved in consumer advocacy groups such as the Alliance for the Mentally Ill, and 51 A-17 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY percent have successfully re-entered the workforce either part time or full time. This includes those that have become employees of the agencies who once offered them vocational or housing assistance. Since the program’s inception more than 400 individuals have been assisted. Based on program outcome data, 65.5 percent of consumers have decreased hospitalization and/or incarceration rates. As a result the county has avoided signiﬁcant costs that it has historically incurred serving AB2034 consumers. Equally important AB2034 consumers have avoided these highly restrictive settings and a 74 percent reduction in homelessness indicates an improved overall quality of life. A-18 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The affordable housing and economic development programs of the twelve FHLBanks consist of grants and low-interest loans to member ﬁnancial institutions to use to provide ﬁnancing for economic development and housing activities. FHLBank grants and low-interest loans are catalysts for the construction and revitalization of housing targeted to people with low- and moderate-incomes. AHP- funded projects serve a wide range of neighborhood needs; many are designed for seniors, the disabled, homeless families, ﬁrst-time homeowners and others with limited resources. The AHP is a competitive program that provides grants twice a year through ﬁnancial institutions for investment in low- or moderate-income housing initiatives. Member banks partner with developers and community organizations to ﬁnance the purchase, construction, or rehabilitation of owner-occupied or rental housing. Grants can also be used to lower the interest rate on loans or cover down payment and closing costs. The program is ﬂexible so that AHP funds can be used in combination with other programs and funding sources, ensuring a project’s feasibility. To make certain that AHP-funded projects reﬂect local housing needs, each FHLBank is advised by a 15-member Affordable Housing Advisory Council for guidance on regional housing and community development issues System Highlights • The AHP is funded with 10 percent of the FHLBank System’s net income each year. • The AHP is one of the largest private sources of grant funds for affordable housing in the country. • In 2005, a combined total of $280 million was made available for regional housing projects. • Since the program’s inception in 1991, over $2 billion dollars in AHP funds have been awarded. • $40 billion in CIP-funded loans have ﬁnanced nearly 600,000 housing units and thousands of economic development projects. A-19 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • The FHLBank System is the largest corporate contributor to Habitat for Humanity International; one in four Habitat homes in the U.S has received AHP funds. HP Eligibility • AHP grants can be used to fund housing for families or individuals with incomes at or below 80 percent of the area median. • For AHP funded rental housing, 20 percent of the units must serve households with incomes at or below 50 percent of the area median. Funding is awarded only to ﬁnancial institution members of the FHLBank System working in partnership with a community sponsor organization. A-20 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Introduction The program provides annual grants on a formula-basis to entitled cities, counties and states to develop viable urban communities by providing decent housing and a suitable living environment, and by expanding economic opportunities, principally for low-and moderate- income persons. The program is authorized under Title 1 of the Housing and Community Development Act of 1974, Public Law 93-383, as amended; 42 U.S.C. 5301 et seq. Nature of Program HUD awards grants to entitlement community grantees to carry out a wide range of community development activities directed toward revitalizing neighborhoods, economic development, and providing improved community facilities and services. Entitlement communities develop their own programs and funding priorities. However, grantees must give maximum feasible priority to activities which beneﬁt low- and moderate-income persons. A grantee may also carry out activities which aid in the prevention or elimination of slums or blight. Additionally, grantees may fund activities when the grantee certiﬁes that the activities meet other community development needs having a particular urgency because existing conditions pose a serious and immediate threat to the health or welfare of the community where other ﬁnancial resources are not available to meet such needs. CDBG funds may not be used for activities which do not meet these broad national objectives. Eligible Grantees Eligible grantees are as follows: • Principal cities of Metropolitan Statistical Areas (MSAs); • Other metropolitan cities with populations of at least 50,000; and • Qualiﬁed urban counties with populations of at least 200,000 (excluding the population of entitled cities) are entitled to receive annual grants. A-21 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY HUD determines the amount of each entitlement grant by a statutory dual formula which uses several objective measures of community needs, including the extent of poverty, population, housing overcrowding, age of housing and population growth lag in relationship to other metropolitan areas. A-22 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Administrative Agencies Federal: • Department of Education (ED): Ofﬁce of Elementary and Secondary Education (OESE) (202) 260-4412 www.ed.gov/about/ofﬁces/list/oese/index.html or www.ed.gov/programs/homeless/index.html California: • Department of Education (916) 319-0791 www.cde.ca.gov/ Type Of Assistance: Formula Program Description This formula grant program is designed to: (1) Ensure that homeless children and youth have equal access to the same free, appropriate public education as other children; (2) Provide activities for and services to ensure that these children enroll in, attend, and achieve success in school; (3) Establish or designate an ofﬁce in each State educational agency (SEA) for the coordination of education for homeless children and youth and responsible for gathering comprehensive information about homeless children and youths and the impediments to their regular attendance at school; (4) Develop and implement programs for school personnel to heighten awareness of speciﬁc problems of homeless children and youth; and A-23 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY (5) Provide grants to local educational agencies (LEAs) for the purpose of facilitating the enrollment, attendance, and success of homeless children and youth in school. Eligibility Information Eligible Target Populations: Homeless children and youth in elementary and secondary schools (and homeless preschool children and the parents of homeless children) Eligible Projects/Programs: Educational activities to facilitate enrollment, attendance and success in school of homeless children and youths. Eligible Use of Funds & Use Restrictions: Activities that will facilitate the educational success of homeless children and youth, including: tutoring, summer enrichment programs, the provision of school supplies, and professional development designed to heighten educators’ understanding of and sensitivity to the needs of homeless children and youth. Services provided with these funds cannot replace the regular academic program and must expand upon or improve services provided as part of the regular academic program. Eligible Applicants/Sponsors: Departments of Education and schools serving Indian students that are funded by the Secretary of the Interior. Only Local Education Agencies (LEAs) are eligible for state sub-grants. Grant Terms Awards: The proposed Fiscal Year 2006/07 allocation to California is anticipated to be $8,085,000 of which $140,000 is to be awarded to the Riverside County Ofﬁce of Education and $110,000 to the Riverside Uniﬁed School District. Term of Awards: One ﬁscal year. Matching Requirements: N/A A-24 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Formula: States (and D.C and Puerto Rico) receive formula grant funds proportionate to the distribution of funds under Section 1122 of the Elementary and Secondary Education Act of 1965, as amended (ESEA). Application Process States (and the District of Columbia and Puerto Rico) receive their allocation annually. The state educational agency (SEA) must distribute not less than 75 percent of their allocation in competitive sub-grants to local educational agencies. States may reserve their remaining funds for State-level activities. States are required to have an approved plan for addressing problems associated with the enrollment, attendance, and success of homeless children in school. Biennial updates of State plans are required for ongoing renewals. CFDA Code: 84.196 Authorizing Legislation McKinney-Vento Homeless Assistance Act of 1987, Title VII, Subtitle B, as amended, 42 U.S.C. 11431-11435 Regulations Title 34 CFR Part 74; FY 2003 Draft Guidance for the Education for Homeless Chidren and Youth Program (March 2003) A-25 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The Emergency Food and Shelter National Board Program was created in 1983 to supplement the work of local agencies and non-proﬁt social service organizations help people in need of emergency assistance. This collaborative effort between the private and public sectors has disbursed more than $2.3 billion in Federal funds through FEMA during its 21-year history. These funds have assisted over 11,000 local provider agencies in more than 2,500 counties and cities. In Riverside County, the program is administered by DPSS. The program was absorbed into the McKinney-Vento Act in 1987 and redeﬁned the program’s purpose: “To supplement and expand ongoing efforts to provide shelter, food and supportive services” for homeless and hungry individuals nationwide. The program is centered on quick response, public-private sector cooperation, local decision making and funds allocations to the neediest areas. The program is governed by a national board composed of representatives of the American Red Cross; Catholic Charities, USA; United Jewish Communities; The National Council of the Churches of Christ in the U.S.A.; The Salvation Army; and United Way of America. The Board is chaired by a representative of the Federal Emergency Management Agency (FEMA). The program’s objectives are: • to allocate funds to the neediest areas, • to ensure fast response, • to foster public/private sector cooperation, • to ensure local decision making, and • to maintain minimal, but accountable, reporting. Local Governance Locally, the program is a model of public-private cooperation. Each civil jurisdiction (a county or city) funded by the program must constitute a local board. The board must be composed of representatives of the same organizations as those on the National Board, with A-26 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY a local government ofﬁcial replacing the FEMA representative. The Local Board members elect their chair. Local boards may also have additional members, and, since 1993, local boards have been required to include a homeless or formerly homeless person as a member. If a jurisdiction is located within or encompasses a federally recognized Indian reservation, a Native American representative must also be invited to serve on the local board. The National Board awards funds to jurisdictions based upon a formula; in addition, a small portion of the overall award is allocated by formula to state set-aside committees, who then allocate funds to jurisdictions based upon the criteria they feel is most appropriate. Once an award is made by either the National Board or a state set-aside committee, local boards decide which agencies are to receive funds, and then those agencies are paid directly by the National Board. Within a jurisdiction, no more than two percent (2%) of the entire award may be used for administrative costs by the local board and agencies combined. In 1985, the National Board created a state set-aside process to identify and fund areas of need not reﬂected in the national criteria. State set-aside committees, with members mirroring local boards, receive funds based upon the number of unemployed people in counties within their state that do not qualify under the National Board’s criteria. State committees may use any criteria they wish to develop a needs-based formula to determine which jurisdictions receive funding. The committees must give priority to jurisdictions which have not qualiﬁed under the National Board formula, but they may also select, with National Board approval, jurisdictions that were funded by the National Board. State Set-Aside Committees may use up.ﬁve percent (5%) for administrative purposes. In a few states, the state set-aside committee acts as a local board and funds agencies directly state-wide. Program funds are an important component of homeless prevention programs and can be used to provide the following (as prioritized by the Local Board in funded jurisdictions): • Food, in the form of served meals or groceries. • Lodging in a mass shelter or hotel. • One month’s rent or mortgage payment. • One month’s utility bill. A-27 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • Minimal repairs to allow a mass feeding or sheltering facility to function during the program year. • Equipment necessary to feed or shelter people, up to a $300 limit per item. Application Applications for EFSP funds are submitted to the Local Board which is responsible for making funding decisions and setting overall priorities for the use of FEMA funds. A-28 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Purpose The Emergency Housing and Assistance Program/Capital Development (EHAPCD) funds capital development activities for emergency shelters, transitional housing, and safe havens that provide shelter and supportive services for homeless individuals and families. Assistance Type Deferred payment loans at three percent (3%) simple interest, forgiven when loan term is complete. Term ranges from ﬁve to 10 years based on the development activity. Terms Competitive application process announced annually via a Notice of Funding Availability (NOFA). 80 percent of the total allocation is available to urban counties, and 20 percent to non-urban counties. Eligible Activities Acquiring, constructing, converting, expanding and/or rehabilitating emergency shelter, transitional housing, and/or safe haven housing and administration of the award (limited to ﬁve percent [5%]). Eligible Applicants Local government agencies and nonproﬁt corporations that shelter the homeless on an emergency or transitional basis, and provide support services. Application Procedure When funds are available, applications are invited through issuance of Notices of Funding Availability (NOFAs). In some counties, including Riverside, Designated Local Boards (DLBs) develop local capital development priorities and advise HCD on the relative merits of applications in their counties. Applications are rated and ranked competitively when the demand A-29 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY for funds is greater than the annual allocation. HCD enters into Standard Agreements with the sponsors of successful applications. The availability of funds was announced by HCD on November 9, 2006 with applications due by February 8, 2007. The current funding round has $24,800,000 available for urban counters with the maximum award per project being $1 million. A-30 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Purpose The State Emergency Housing and Assistance Program (EHAP) Operating Facility grants are component funds for emergency shelter, transitional housing, safe havens, and temporary rental assistance and winter shelter programs. The funds are to assist housing programs with their operational costs, as well as for the expansion of bed capacity and/or supportive services offered to clients. Funds are allocated (by formula) to counties that either establish a local planning council, known as a Designated Local Board (DLB), or defer such local planning and priority-setting, and allow the State Department of Housing and Community Development to review requests for funding and administer grant assistance. In Riverside County, EHAP is administered by the Department of Public Social Services. Assistance Type and Term EHAP operating funding is allocated annually as grant assistance. Funds must be expended within fourteen months of contract execution. Eligible Activities EHAP operating funds may be used to establish new emergency shelters, transitional housing, or safe havens, or to expand existing facilities in order to increase the number of homeless persons served, expand existing eligible supportive services, or bring existing facilities up to a level that meets State health and safety standards. These funds may also be used to operate weather-activated shelters, provide short-term rental and/or utility assistance and deposits, and for other forms of assistance that may prevent eviction. A limited amount of EHAP funds may be used to upgrade or repair a shelter. Eligible Applicants EHAP funds may be allocated to not-for-proﬁt organizations or to local government agencies. Applicants must have provided client housing continuously each day for at least a year prior to application submission. EHAP funds may not be used to supplant (substitute) existing emergency shelter or transitional housing funding. A-31 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Application Procedure Designated Local Boards (DLBs) develop local strategies to allocate EHAP funding, and rate and recommend applications. The Round 13 (2006) awards in Riverside County were as follows: Alternatives to Domestic Violence $30,000 Martha’s Village and Kitchen, Inc. $30,000 Path of Life Ministries $21,910 Riverside County Department of Mental Health $32,896 The Homeless Task Force of Corona $30,000 Authorizing Legislation/Statute Health and Safety Code (H&SC) Sections 50800 through 50806.5, and Chapter 47, Statutes of 2006 (Budget Act of 2006), establish the Emergency Housing and Assistance Program (EHAP) and specify the eligible uses of funding for this allocation. The EHAP is administered by the California Department of Housing and Community Development. Regulations/Guidelines Title 25, Division 1, Chapter 7, Subchapter 12 Additional Resources http://www.hcd.ca.gov/fa/ehap/ehapfunding.html A-32 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The Emergency Shelter Grants program is a HUD formula-based program assisting eligible localities with funds to provide homeless persons with basic shelter and essential supportive services. It can assist with the operational costs of the shelter facility, and for the administration of the grant. ESG also provides short-term homeless prevention assistance to persons at imminent risk of losing their own housing due to eviction, foreclosure, or utility shutoffs. Grantees are state governments, large cities, urban counties, and U.S. territories. Funds may be granted to eligible recipients which can be either local government agencies or private nonproﬁt organizations that provide assistance to homeless persons. Recipient agencies and organizations apply to the EDA or the City of Riverside Development Department. The City of Riverside received a Fiscal Year 2006 allocation from HUD of approximately $150,000 and the County of Riverside was allotted just over $440,000 in Fiscal Year 2006. Eligible Activities ESG funds are available for the rehabilitation or remodeling of a building used as a new shelter, operations and maintenance of the facility, essential supportive services (i.e., case management, physical and mental health treatment, substance abuse counseling, childcare, etc.), homeless prevention, and grant administration. Renovated buildings must be maintained as shelters for the homeless for at least three years (10 years in the case of major renovations). Ineligible Activities ESG funds may not be used to acquire a shelter or engage in new construction activities, but rehabilitation and conversion are permissible activities. Match Requirement Local government grantees must match ESG grant funds dollar for dollar with other resources. Matching funds may come from either the grantee or the recipient agency or organization and may be federal funds, state or local grants, or “in-kind” contributions (such as the value of a donated building), supplies and equipment, new staff services, and volunteer time. The only federal funds that do not count toward the match are other McKinney-Vento (homeless) funds. A-33 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The Federal Department of Health and Human Services (HHS) has primary responsibility for allocating funds related to health and human services, including substance abuse prevention and treatment, mental health treatment, community-based social services and child care. In most cases, the bulk of Federal services funding is distributed in block grants/ formula- based allocation grant programs usually going to the state department that is responsible for the service in question for a particular population. Funding for services in supportive housing and other homeless services are rarely funded with Federal pass-through funding, but such services are eligible for this assistance. These block grant programs are occasionally combined with other local sources to fund the service needs of particular special-needs populations. HUD is increasingly encouraging localities to plan for the use of “mainstream” HHS sources in their comprehensive approaches to address homelessness. The following are brief summaries of the mainstream HHS block grant programs which may be used at the local level to fund supportive services for homeless populations. CCDF funds states, territories and tribes to assist low-income families, families receiving temporary public assistance, and those transitioning from public assistance in obtaining childcare so they can work or attend training/education. Beneﬁciaries of CCDF funds must be children under age 13 (or, at the option of the grantee, up to age 19 if physically or mentally incapable of self-care or under court supervision) • who reside with a family whose income does not exceed 85 percent of the State median income adjusted for family size, and who reside with a parent (or parents) who is either working, attending job training or an educational program; or • who are in need of, or are receiving protective services. Except for approved construction of childcare facilities by tribal grantees, no CCDF funds A-34 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY may be used for the purchase or improvement of land, or for the purchase, construction, or permanent improvement of any building or facility (other than remodeling or upgrading facilities to meet State and local child care standards.) Under the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996 (“welfare reform”), the Child Care and Development Fund has changed Federally subsidized child care programs in states by allowing them to serve families through a single, integrated child care system as all child care funding is now combined under the Child Care and Development Block Grant Act. Subsidized childcare services are available to eligible families through certiﬁcates or contracts with providers; parents may select any legally operating childcare provider that meets basic health and safety requirements set by states and tribes. All states, territories and tribes must submit comprehensive plans every two years, which require public hearings regarding the plan; public comment is invited through this process. In Fiscal Year 2006 HHS allocated nearly $536 million to California through this block grant program. The CMHS Block Grant funds states and territories to provide comprehensive, community- based systems of care for adults with serious mental illnesses (SMI) and children with serious emotional disorders (SED) through outreach, mental health treatment, and other health care. Among the other eligible uses of the funds are individualized support services, rehabilitation, employment assistance, housing assistance, and education. These funds are used ﬂexibly by the State of California, but they may not be used for the following activities: inpatient services, cash payment to recipients, capital development, and purchase of medical equipment. This is the major Federal source to plan and implement community-based mental health services. Funding is dependent upon approval of an annual plan submitted to HHS that includes speciﬁc program goals and outcomes to be measured. The plan itself is developed at the State level with input from the State Planning Council. In Fiscal Year 2005/06 the State of California received an allocation of over $55 million through the CMHS program, and most of which is allocated to county mental health departments. In Fiscal Year 2005/06, the Superior Court of California, County of Riverside received an award of $400,000 to provide three-years of enhanced treatment and supportive services through its Family Preservation Court program. These funds are expected to assist 360 drug-dependent clients over its three-year grant period. A-35 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Mission Statement: The Community Services Block Grant (CSBG) program provides States, the District of Columbia, the Common Wealth of Puerto Rico, U.S. Territories, and federal and state-recognized Indian Tribes and tribal organizations, Community Action Agencies, migrant and seasonal farm-workers or other organizations designated by the States, funds to alleviate the causes and conditions of poverty in communities. Major Goal: The CSBG program provides states and Indian Tribes with funds to lessen poverty in communities. The funds provide a range of services and activities to assist the needs of low-income individuals including the homeless, migrants and the elderly. Grant amounts are determined by a formula based on each States’ and Indian Tribes’ poverty population. Grantees receiving funds under the CSBG program are required to provide services and activities addressing the following: employment, education, better use of available income, housing, nutrition, emergency services, and health. • In 2004 $642 million was available for CSBG • In 2005 $636.8 million was available for CSBG • In 2006, $630.4 million was available for CSBG • In 2007, the President has requested no funds for CSBG The Community Services Block Grant program is designed to provide a range of services to assist low-income people in attaining the skills, knowledge, and motivation necessary to achieve self-sufﬁciency. The program also provides low-income people with immediate life necessities such as food, shelter, and health care needs, etc. In addition, services are provided to local communities for the revitalization of low-income communities, the reduction of poverty and to help provider agencies to build capacity and develop linkages. Services provided with CSBG must contribute to the achievement of one or more of the six goals developed by the National CSBG Monitoring and Assessment Task Force. • Low-income people become more self-sufﬁcient; • The conditions in which low-income people live are improved; • Low-income people own a stake in their community; • Partnerships among supporters and providers of services to low-income people are achieved; A-36 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • Agencies increase their capacity to achieve results; • Low-income people achieve their potential by strengthening family and other supportive systems. The Community Services Block Grant program funds are allocated to the state’s existing network of community action agencies and other eligible entities. This is a formula based grant and is not competitive. Social Services Block Grant (SSBG) is authorized by Title XX of the Social Security Act. Funds enable each state to furnish social services best suited to meet the needs of the individuals residing within the state. Such services may be, but are not limited to: daycare for children or adults, protective services for children or adults, special services to persons with disabilities, adoption, counseling, case management, family planning, health-related services, transportation, foster care for children or adults, substance abuse, legal, housing, home- delivered meals, congregate meals, independent/transitional living, special services for youth, employment services or any other social services found necessary by the state for its population. Funds are allocated to the 50 States, the District of Columbia, the Commonwealth of Puerto Rico, and the Territories of Guam, American Samoa, the Virgin Islands, and the Northern Mariana Islands in proportion to each State’s population. Services funded by the SSBG as far as practicable under the conditions of that State are directed at one or more of these ﬁve goals: • Achieving or maintaining economic self-support to prevent, reduce or eliminate dependency • Achieving or maintaining self-sufﬁciency, including reduction or prevention of dependency • Preventing or remedying neglect, abuse or exploitation of children and adults unable to protect their own interest, or preserving, rehabilitating or reuniting families • Preventing or reducing inappropriate institutional care by providing for community-based care, home-based care or other forms of less intensive care • Securing referral or admission for institutional care when other forms of care are not appropriate or providing services to individuals in institutions. A-37 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY State and/or local Title XX agencies (i.e., county, city, regional ofﬁces) may provide these services directly or purchase them from qualiﬁed agencies and individuals. In Fiscal Year 2007 the State of California is expected to receive over $145 million in SSBG funding. No information could be obtained on how much of this funding was allocated to the County of Riverside. The SAPT Block Grant funds states, tribes and territories to support substance abuse prevention and treatment programs for people at risk of or abusing drugs and alcohol. (20 percent of funds allocated to states must be spent on substance abuse primary prevention services.) While the program enables states and localities to provide substance abuse prevention and treatment services through a variety of means, both statute and regulations place special emphasis on provision of treatment and primary prevention services to injecting drug users, and to women who use substances and are pregnant or with dependent children. States have ﬂexibility in how to use these funds, but some activities are ineligible, including: inpatient hospital substance abuse programs, cash payments to recipients, capital development, and needle-exchange and provision programs. In California, the block grant accounts for approximately 70 percent of public funds expended on substance prevention and treatment services. In Fiscal Year 2006/07 SAMHSA is schedule to allocate over $227 million in SAPT funds to California of which nearly $10 million is slated to be allocated to the County of Riverside for a full range of program activities. Child Care and Development Fund CFDA Code: 93.575 Legislation: Child Care and Development Block Grant Act of 1990, as amended, Public Law 101-508, 42 U.S.C. 9858 et seq.; Personal Responsibility and Work Opportunity Reconciliation Act of 1996, Public Law 104-193; Balanced Budget Act of 1997, Public Law 105-33; Departments of Labor, Health and Human Services, and Education, and Related Agencies Appropriations Act of 2006, Public Law 109-149. Regulations: 45 CFR Parts 98 and 99 A-38 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY CFDA Code: 93.958 Legislation: Public Health Services Act, Title XIX, Part B, Subpart I as amended, Public Law 106-310; 42 U.S.C. 300X Regulations: 45 CFR Part 96 CFDA Code: 93.569 Legislation: Community Opportunities, Accountability, Training, and Educational Services Act of 1998, Title II, Section 201 and Sections 671-thru 679, Public Laws 97- 35, 103-252, Public Laws 106-554 and 98-502 Regulations: 45 CFR 16, 45 CFR 74, 45 CFR 96 CFDA Code: 93.667 Legislation: Social Security Act, Title XX, as amended (see CFDA for full citation) Regulations: 45 CFR 96 (For example, Chafee Foster Care Independent Living formula grant program targeting aging out foster youth, CFDA code 93.674; Promoting Safe and Stable Families formula grant program targeting preserving at-risk families, CFDA code 93.556.) CFDA Code: 93.959 Legislation: Public Health Services Act, Title XIX, Part B, Subpart II as amended, Public Law 106-310; 42 U.S.C. 300X Regulations: 45 CFR Part 96 A-39 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY On August 31, 2005, Governor Schwarzenegger announced an initiative to address long- term homelessness in California. As part of this initiative, he directed the Department of Housing and Community Development (HCD), the California Housing Finance Agency (CalHFA) and the Department of Mental Health (DMH) to provide an integrated package of funding for the development of permanent supportive housing for persons with severe mental illness who are chronically homeless. These housing development funds are intended to be complemented by Mental Health Services Act (MHSA) funds from counties, as described in Section D. This NOFA announces the funds available under the Governor’s Homeless Initiative, as follows: 1. Approximately $40 million in permanent development ﬁnancing under HCD’s Multifamily Housing Program (MHP) for units set aside for persons with severe mental illness who are chronically homeless. These funds were appropriated by the Housing and Emergency Shelter Trust Fund Act of 2002 (Proposition 46). 2. Additional MHP funds for other units, in projects serving mixed populations that do not use nine percent (9%) credits. 3. Construction, bridge and permanent ﬁnancing from CalHFA, based on CalHFA’s loan underwriting criteria for supportive housing projects. 4. Approximately $2 million in State share Mental Health Services Act (MHSA) funds for rent subsidies. Applications are accepted on an “over-the-counter” basis. Authority MHP was established by SB 1121, Statutes of 1999 (Alarcón), which created Chapter 6.7, commencing with Section 50675, of the Health and Safety Code. In addition to the requirements of this NOFA, applications shall be subject to two sets of regulations, the A-40 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY MHP-speciﬁc Regulations (including Article 6. Supportive Housing Loans) and the Uniform Multifamily Regulations (UMR), both of which are available on the HCD’s website at www.hcd.ca.gov/ca/mhp. Applications submitted under this NOFA are also subject to the applicable statutory requirements (including those of Proposition 46 and SB 1227 of 2002). All section references in this NOFA refer to the MHP regulation text unless otherwise noted. UMR section references refer to the Uniform Multifamily Regulations. Target Population GHI targets chronic homeless households, deﬁned as: 1. Households whose income does not exceed 30 percent of Area Median Income (or 30 percent of State Median Income, if this is a greater amount); and 2. Households that include an adult or older adult member eligible for services under the Mental Health Services Act (MHSA) who is Chronically Homeless. Welfare and Institutions Code Section 5813.5 speciﬁes who is eligible for services under the MHSA, by reference to Welfare and Institutions Code Section 5600.3(b) and (c). “Chronically Homeless” means individuals (including accompanied individuals) who have been continuously “Homeless” for a year or more during the past three years or have experienced four or more episodes of sustained homelessness during the past three years. “Homeless” means the same as that term is deﬁned in Section 7341(b), except that it does not include individuals moving directly from transitional housing who have occupied such housing for more than a year. With advance State approval, project sponsors may elect to abide by more restrictive deﬁnitions of these terms, such as those used by HUD. The MHP set-aside funds may only be used to cover development costs for permanent housing linked to services where occupancy is restricted to the Target Population (“Target Population Units”). These units are a subset of the units deﬁned as Supportive Housing Units under the MHP regulations. County Mental Health Department Role Typically, projects serving the Target Population will require three types of subsidies: (1) development (capital) subsidies; (2) operating or rental subsides to cover the difference each year between the cost of operating the housing and tenant-paid rents; and (3) subsidies for A-41 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY mental health and other supportive services. The GHI offers development subsidies, plus a sharply limited amount of funds for rental subsidies. In some areas, federal funds are available for more substantial rental subsidies and some supportive services. To be eligible for GHI funds, projects must have commitments from the local County Mental Health Department for ongoing Mental Health Services Act funding. At a minimum, Counties must commit funding for services, and, operating subsidies (where federal funding is inadequate for this purpose). Since the State is making a major capital investment in housing intended to serve the Target Population for many years, County funding commitments shall be formalized through Memorandums of Understanding, or similar agreements, and shall be for the longest legally permissible term. County commitments must also be consistent with the Community Services and Supports plan submitted to (and ultimately approved by) the State. Eligible Project Sponsors Sponsors and borrowing entities may be organized on a for-proﬁt or not-for-proﬁt basis. Any individual, public agency or private entity capable of entering into a contract is eligible to apply, provided that they or their principals have successfully developed at least one affordable housing project. Sponsors of projects where at least 70 percent of the units consist of Target Population Units or Special Needs Population units are exempt from the requirement for previous development experience under limited conditions. See Section 7303 (d). Sponsors must also demonstrate a minimum of 24 months experience in the ownership or operation of at least one Supportive Housing or Special Needs Population project with ﬁve or more units, and provide the commitment of County Mental Health Department funds described in Section D. See Section 7343. Sponsors must have site control in the name of the Sponsor or an entity controlled by the sponsor as deﬁned in Uniform Multifamily Regulations (UMR) Section 8303. Eligible Uses of Funds MHP funds will be provided as permanent ﬁnancing only, and may be used to take out construction loans used to cover normal project development (capital) costs. MHP funds may also be used to capitalize a project operating reserve account for up to four months. MHP funds may not be used for the cost of supportive services, although the cost of on-site supportive services coordination may be treated as a project operating cost, payable from operating income. MHP funds A-42 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY must be attributable to the costs of “restricted” units (MHP units and units subject to a long- term regulatory agreement with occupancy and rent restrictions similar to those of MHP) or to the costs of facilities used for childcare, after-school care, and social service provision integrally linked to the restricted units. CalHFA funds are available as construction, bridge and permanent ﬁnancing. They may be used to cover normal project development (capital) costs. Eligible Projects Projects must qualify as rental housing developments, as deﬁned in UMR Section 8301, and meet the requirements of Sections 7302 and 7342. For example, projects must contain ﬁve or more dwelling units. Projects must contain Target Population units, as deﬁned in Section C above, in an amount equal to the greater of ﬁve units or 35 percent of the total project units. The income limit for Target Population Units shall not exceed 30 percent of Area Median Income (or 30 percent of State median income, if this is a greater amount). Projects are ineligible if construction has commenced prior to the date funds offered under this NOFA are awarded, or if the project is already fully funded. Maximum MHP Loan Amounts The maximum MHP loan amount is a function of the number of restricted units in a project, their size, location, affordability level, whether the project is receiving nine percent (9%) tax low income housing tax credits (LIHTC), and the number and type of units restricted to the Target Population. For projects not receiving nine percent (9%) LIHTC, the per unit limits are the same as for other MHP NOFAs, except that the base amount for Target Population units is $60,000 instead of $30,000. HCD updates the subsidy amount periodically (roughly every 12 to 18 months). For projects receiving nine percent (9%) LIHTC credits, the per-unit limits are as the same for other MHP NOFAs (with a $30,000 base amount), but the total maximum loan amount will be calculated by applying these limits to Target Population Units only. The maximum loan per project is $7,000,000. Loan Terms and Security MHP Loans have a 55-year term, and bear simple interest at the rate of three percent (3%) per year. For the ﬁrst 30 years, annual payments will be required in the amount of 0.42 percent (0.42%) of the outstanding principal loan balance. The annual payment amount A-43 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY for the next 25 years will be set by the HCD in year 30, and will be the minimum amount necessary to cover the HCD’s monitoring costs. Unpaid principal and accrued and deferred interest will be due at the end of the loan term. CalHFA construction loans have a 12- to 36-month loan term, with a variable interest rate. Monthly interest-only payments (capitalized) will be required through the term of the construction loan. In addition, permanent loans and bridge loans will be available under CalHFA’s Special Needs Financing Program. Tax-exempt bridge loans for projects receiving four percent (4%) tax credits will have a one- to three-year term, while permanent loans will have a term of ﬁve to 30 years. Application Process The Application form is available on the HCD website. Applications are considered on an “over-the-counter” basis until available funds are exhausted. A-44 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Federal: • Department of Health and Human Services (HHS): Health Resources and Services Administration (HRSA) Bureau of Primary Health Care Divisions of Health Center Development and Health Center Management (301) 594-4300 and (301) 594-4420 www.bphc.hrsa.gov Type Of Assistance: Competitive Program Description The Health Care for the Homeless (HCH) program delivers a full range of comprehensive primary health care services to homeless people through a multi-disciplinary approach that combines aggressive outreach with integrated systems of primary care, mental health and substance abuse services, case management and client advocacy . Part of the allocation for Community Health Centers (CFDA Code 93.224), Health Care for the Homeless is a competitive grant program designed to promote and sustain the health status, outcomes and well-being of homeless people, including homeless children. In addition to direct federal grant funding, Health Care for the Homeless programs qualify for enhanced Medicaid reimbursement provisions as Federally Qualiﬁed Health Centers (FQHCs.) A-45 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Table 1. Federal Assistance for HCH Grants Federal Assistance for HCH Grants Year Appropriations (In millions) 1995 $65.4 1996 $65.4 1997 $69.4 1998 $71.3 1999 $80.0 2000 $88.0 2001 $101.0 2002 $116.0 2003 $130.0 2004 $137.0 2005 $145.0 Eligible Target Populations: Homeless individuals including but not limited to children, elderly persons, handicapped persons, families with children, Native Americans, and veterans. Homeless individual is deﬁned as an individual who lacks housing (without regard to whether the individual is a member of a family), including an individual whose primary residence during the night is a supervised public or private facility that provides temporary living accommodations, an individual who is a resident in transitional housing, or a person who was homeless and has been living in permanent housing for one year or less. Eligible Projects/Programs: HCH programs are encouraged to integrate both health and social services into individual care plans and to provide a coordinated, comprehensive approach to the care they provide their homeless clients. Applicants for this program are further encouraged to include homeless people in the development and oversight of the HCH program in order to foster client-centered approaches to treatment. HCH funds can be used to provide eligible services A-46 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY in shelters, transitional housing and for up to 12 months in permanent housing, if the services were provided to the individuals when they were homeless. For ongoing funding for some of the services paid for with time-restricted HCH grant funding, the HCH grantee may pursue billing Medicaid for eligible services as a Federally Qualiﬁed Health Center (see the Medicaid description for more information) or identify other sources of funds. Eligible Use of Funds & Use Restrictions: Outreach; primary health care, mental health and substance abuse services at locations accessible to homeless individuals; 24-hour emergency primary health, mental health and substance abuse services; referrals, as appropriate to medical facilities and to needed mental health services; outreach services to inform homeless individuals of the availability of primary health, mental health and substance abuse services; supplementary services (e.g., podiatry, dental and vision care, etc.) and, aid in establishing eligibility for assistance, and in obtaining services under entitlement programs and housing programs. HCC funds may be used to continue to provide the services listed above for up to 12 months to individuals who have obtained permanent housing if services were provided to these individuals when they were homeless. Eligible Applicants/Sponsors: Eligible applicants include: private non-proﬁt organizations and public entities, including State and local governmental agencies. Applicants/sponsors may provide these services directly or through contract. Grantees and other organizations with which applicants contract for services under this program must have an agreement with a State under its Medicaid program and be qualiﬁed to receive payments under the agreement. About half of Health Care for the Homeless projects is administered by community and migrant health centers; the other half is administered by nonproﬁt coalitions, inner city hospitals and local public health departments. Term of Awards: Grants are awarded for ﬁve years, although funding for years two to ﬁve is contingent upon available funding and project performance. A-47 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Matching Requirements: The applicant must assume part of the project costs determined on a case-by-case basis. Application Process Eligible sponsors apply for HCH for a ﬁve-year period, although funding for years two to four is contingent upon available funding and project performance. After the initial year, applications for funding are submitted annually as budget period renewals. After the ﬁve-year project is completed, other local organizations can compete with the previous HCH grant recipient in the same service area by submitting a grant application. The program accepts applications for new service areas, called “new starts”, only when there is an increase in the program appropriation. For information about current HCH grant funding opportunities, look at the HRSA Preview, published twice a year, which is a consolidated announcement of all of HRSA’s funding opportunities. (Visit www.hrsa.gov, and click on Grants under the Funding site.) CFDA Code: 93.151 Authorizing Legislation/statute Public Health Service Act, as Amended under the Health Centers Consolidation Act of 1996, Section 330(h), Public Law 104-299. Regulations/guidelines 52 CFR 32347 “Availability of Funds for Project Grants for Health Services to the Homeless Population” A-48 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY HOME is authorized under Title II of the Cranston-Gonzalez National Affordable Housing Act, as amended. Program regulations are at 24 CFR Part 92. The HOME program ﬁnal rule is available electronically. Additional information about the HOME program can be found by visiting the HOME program web pages. HOME provides formula grants to States and localities that communities use—often in partnership with local nonproﬁt groups—to fund a wide range of activities that build, buy, and/or rehabilitate affordable housing for rent or homeownership, or provide direct rental assistance to low-income people. Purpose HOME is the largest Federal block grant to State and local governments designed exclusively to create affordable housing for low-income households. Each year HUD allocates approximately $2 billion among the States and hundreds of localities nationwide. The combined allocation of HOME funds to eligible jurisdictions within Riverside County in Fiscal Year 2006 is: $6.3 million. The HOME program was designed to reinforce several important values and principles of community development: • HOME’s ﬂexibility empowers localities to design and implement strategies tailored to their own needs and priorities; • HOME’s emphasis on consolidated planning expands and strengthens partnerships among all levels of government and the private sector in the development of affordable housing; • HOME’s technical assistance activities and set-aside for qualiﬁed community-based nonproﬁt housing groups builds the capacity of these partners; • HOME’s requirement that participating jurisdictions (PJs) match 25 cents of every dollar in program funds mobilizes community resources in support of affordable housing. Types of Assistance HOME funds are awarded annually as formula grants to participating jurisdictions. HUD establishes HOME Investment Trust Funds for each grantee, providing a line of credit that the jurisdiction may draw upon as needed. The program’s ﬂexibility allows States and local governments to use HOME funds for grants, direct loans, loan guarantees or other forms of credit enhancement, or rental assistance and security deposits. A-49 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Eligible Grantees States are automatically eligible for HOME funds and receive either their formula allocation or $3 million, whichever is greater. Local jurisdictions eligible for at least $500,000 under the formula ($335,000 in years when Congress appropriates less than $1.5 billion for HOME) also can receive an allocation. Communities that do not qualify for an individual allocation under the formula can join with one or more neighboring localities in a legally binding consortium whose members’ combined allocation would meet the threshold for direct funding. Other localities may participate in HOME by applying for program funds made available by their State. Eligible Customers The eligibility of households for HOME assistance varies with the nature of the funded activity. For rental housing and rental assistance, at least 90 percent of beneﬁting families must have incomes that are no more than 60 percent of the HUD-adjusted median family income for the area. In rental projects with ﬁve or more assisted units, at least 20 percent of the units must be occupied by families with incomes that do not exceed 50 percent of the HUD-adjusted median. The incomes of households receiving HUD assistance must not exceed 80 percent of the area median. HUD publishes updated income limits annually. Eligible Activities Participating jurisdictions (PJs) may choose among a broad range of eligible activities, using HOME funds to provide home purchase or rehabilitation ﬁnancing assistance to eligible homeowners and new homebuyers; build or rehabilitate housing for rent or ownership; or for “other reasonable and necessary expenses related to the development of non-luxury housing,” including site acquisition or improvement, demolition of dilapidated housing to make way for HOME-assisted development, and payment of relocation expenses. PJs may use HOME funds to provide tenant-based rental assistance contracts of up to two years if such activity is consistent with their Consolidated Plan and justiﬁed under local market conditions. This assistance may be renewed. Up to 10 percent of the PJs annual allocation may be used for program planning and administration. HOME-assisted rental housing must comply with certain rent limitations. HOME rent limits are published each year by HUD. The program also establishes maximum per unit subsidy limits and maximum purchase-price limits. A-50 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Some special conditions apply to the use of HOME funds. PJs must match every dollar of HOME funds used (except for administrative costs) with 25 cents from non-federal sources, which may include donated materials or labor, the value of donated property, proceeds from bond ﬁnancing, and other resources, including redevelopment and State funds. In addition, PJs must reserve at least 15 percent of their allocations to fund housing to be owned, developed, or sponsored by experienced, community-driven nonproﬁt groups designated as Community Housing Development Organizations (CHDOs). PJs must ensure that HOME- funded housing units remain affordable in the long term (20 years for new construction of rental housing; ﬁve-15 years for construction of homeownership housing and housing rehabilitation, depending on the amount of HOME subsidy). PJs have two years to commit funds (including reserving funds for CHDOs) and ﬁve years to spend funds. Application Program funds are allocated to units of general local government on the basis of a formula that considers the relative inadequacy of each jurisdiction’s housing supply, its incidence of poverty, its ﬁscal distress, and other factors. Shortly after HOME funds become available each year; HUD informs eligible jurisdictions of the amounts earmarked for them. Participating jurisdictions must have a current and approved Consolidated Plan, which will include an action plan that describes how the jurisdiction will use its HOME funds. A newly eligible jurisdiction also must formally notify HUD of its intent to participate in the program. HOME and Homeless Housing HUD has provided guidance to grantees as to the use of HOME Program funds to assist in the development and operation of housing for homeless populations. HOME funds can be used to develop transitional or permanent housing for individuals and families experiencing homelessness. Additionally, HOME funds can be used as tenant-based rental assistance (TBRA) to assist homeless persons to access permanent housing in the community. HUD regulations, however, prohibit the use of HOME funds as project-based rental assistance. HOME funds may not be used to provide emergency rental assistance, nor may funds be used for the development or operation of emergency shelters. A-51 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The HELP Program offers a three and one half percent (0.5%) interest rate loan to local government entities for their locally determined affordable housing activities and priorities. HELP Program funds can be used to assist with the acquisition, development, rehabilitation or preservation of multifamily rental units and special needs housing. In addition, this program also provides ﬁnancing to facilitate the construction or rehabilitation of ownership housing, as well as making funds available for the implementation of subordinate loan programs for eligible home buyers. Open application periods are announced each spring and fall (typically February and August). Applicants (local government agencies) compete for approximately $7.5 million of HELP Program funding in each round. Program Objective To provide affordable housing opportunities through program partnerships with local government entities, consistent with their affordable housing priorities. Program Parameters Affordable Housing. HELP Program funds must be used to directly provide affordable housing units. Housing units must be affordable for at least 10 years, with “affordable” being deﬁned in the context of the unmet housing needs and priorities of the locality. HELP Program funds may not be used for technical assistance or administrative costs. Local Government Involvement. Local government entities (e.g., city and county housing- related divisions and agencies, and redevelopment agencies) must have a direct involvement with their programs. Local government entity involvement can include ﬁnancial contributions of Federal, State, and locality program funds, and contributions such as land write-downs, fee waivers, density bonuses, and local agency program stafﬁng and administration, and other similar beneﬁts. Unmet Affordable Housing Needs. HELP funds are intended to help local government entities address unmet affordable housing needs as determined by each participating locality. Local government entities must demonstrate how the local priority was established and A-52 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY approved Commonly, priorities are stated in Housing Elements, Consolidated Plans, or other documented housing plans. Eligible housing activities under the program are as follows: • Multifamily Rental Housing. Rehabilitation and code enforcement programs; and revolving loan programs to assist with site acquisition, predevelopment and construction of projects; or ﬁnancing to support the development of a speciﬁc project. (This housing category accommodates shelters, special needs that include group homes, etc.) • Single-Family Ownership Housing. Rehabilitation and code enforcement programs, revolving loan programs to assist with construction ﬁnancing, and subordinate loan programs for homebuyers. Please Note: The Agency’s new Residential Development Loan Program (RDLP) provides ﬁnancing for site acquisition and predevelopment activities for inﬁll housing; you can obtain further information on this program at CalHFA’s website (www. calhfa.ca.gov). Additionally, HELP and RDLP cannot be accessed for the same project, unless HELP is used exclusively to provide construction ﬁnancing or subordinate loans for the homebuyers of that project. Loan Conditions and Repayment. HELP funds are available to a local government entity as an unsecured loan from CalHFA for up to 10 years at three and one half percent (0.5%) simple interest per annum, and carry minimal restrictions and conditions. Repayment is backed by the general obligation of the local government entity and is required, in full, no later than 10 years from the date a loan agreement is executed. The local government entity shall assure and demonstrate that it possesses full authority to enter into the loan agreement and to repay the loan under the terms and conditions of the loan agreement. Loan-to-Lender Format. Under this format, the local government entity contracts to repay CalHFA and re-lends or otherwise utilizes the funds for its stated purposes. The local government entity does not provide property or other resources as collateral. General Considerations for Program Design Evaluation Criteria. Proposals will be ranked on a competitive basis, using the following criteria: • Extent to which assisted units are affordable (term, depth, amount, proportion of assisted units within project, relative affordability given the market) • Efﬁciency of program costs (interest rate, administrative and stafﬁng costs, source and A-53 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY assurance of HELP loan repayment, timing of HELP repayment, etc.). NOTE: If the HELP Program funds are intended to be reloaned by the local government entity to their program participant(s), then the interest rate on the reloaned funds should be as low as practical to provide the maximum beneﬁt to the assisted households. • Maximization of beneﬁt (number of units, HELP funds per unit, number of persons to beneﬁt, etc.) • Implementation readiness (local agency experience with the type of housing activity, stafﬁng and administrative capacity, local agency ﬁnancial capacity, site control, requisite zoning and entitlements, local programs in place, drafted implementation plan, market and risk analyses, other ﬁnancing sources in place, authority to proceed has been provided by local government, etc.) • Relative resource impact in directly achieving program objectives (the locality’s relative ability to contribute funds, stafﬁng, administration and in-kind services; and the depth of leveraging provided) • Comprehensiveness of physical design (physical design aspects that enable the residents and incorporation of the housing into the community; physical design aspects of consistency of residential development in relation to surrounding land use) and resident support structure (that potentially includes, as appropriate, homeownership education and training, community building, participatory management or governance, personal enrichment, direct support services, and linkages to local support services, etc.) Documented Housing Plans. Proposals must include documented housing plans that demonstrate that the proposed housing activity described in the application has been identiﬁed as a local housing priority. Eligible documented housing plans include the Housing Elements, Consolidated Plans, redevelopment plans or other general housing plans that the locality’s governing board has ratiﬁed. Applications must also include evidence that a plan has been approved. Federal, State, and Local Requirements. Federal, State or local government requirements may apply in this process depending on the nature and structure of the local program. These requirements may include Davis-Bacon and/or State Prevailing Wages and compliance with Article 34 of the California State Constitution. A-54 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY If the applicant to the HELP Program is a city or county rather than a separate legal entity such as a redevelopment agency or housing authority, the applicant must address the requirements of Article 16, Section 18 (public ﬁnance indebtedness limitation), of the California Constitution. If a city or county is awarded funding, the agency will require an opinion letter from its legal counsel to conﬁrm that entering into a loan agreement under the Program is not in violation of this requirement. Equitable Distribution of Funds. One of CalHFA’s goals is to ensure an equitable distribution of HELP funds throughout California. CalHFA will utilize equitable distribution as a factor in the application ranking process to the extent necessary to achieve this goal. Proposal Limitations (These limitations were applicable in previous funding rounds and are subject to change in future program announcements): • Applicants are limited to local government entities (i.e., city, county, housing authority, redevelopment agency, etc.). • Proposals are limited to a maximum request of $1,500,000. • Applicants are limited to one proposal in a funding round. • Applicants are limited to one approved proposal in a ﬁscal year (which begins July 1 and ends June 30). • Only one proposal for a speciﬁc project or program may be submitted (e.g., multiple proposals for the same project or program from the redevelopment agency and housing authority located in the same city will not be accepted.) • Proposals for a particular project or program, regardless of the applicant, will be limited to a maximum of one approved funding per ﬁscal year and two approved requests, overall. To obtain additional program information, or to be placed on the mailing list to receive program announcements for future funding rounds (occurring typically in February and August of each year), pvlease contact HELP Program staff at (916) 323-8232. You may also check this web site for future program funding announcements and news. A-55 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY About The HOPWA Program HUD’s Ofﬁce of HIV/AIDS Housing manages the HOPWA program in collaboration with 44 state and area CPD ofﬁces in providing guidance and program oversight. The Ofﬁce works with other HUD ofﬁces to ensure that all HUD programs and initiatives are responsive to the special needs of people with HIV/AIDS. One of the primary functions of the Ofﬁce is to administer the Housing Opportunities for Persons with HIV/AIDS (HOPWA) program. The HOPWA Program was established by HUD to address the speciﬁc needs of persons living with HIV/AIDS and their families. HOPWA makes grants to local communities, States, and nonproﬁt organizations for projects that beneﬁt low income persons medically diagnosed with HIV/AIDS and their families. HOPWA Programs HOPWA funds are awarded as grants from one of three programs: • The HOPWA Formula Program uses a statutory method to allocate HOPWA funds to eligible States and cities on behalf of their metropolitan areas. • The HOPWA Competitive Program is a national competition to select model projects or programs. HOPWA funding provides housing assistance and related supportive services as part of HUD’s Consolidated Planning initiative that works in partnership with communities and neighborhoods in managing Federal funds appropriated to HIV/AIDS programs. HOPWA grantees are encouraged to develop community-wide strategies and form partnerships with area nonproﬁt organizations. HOPWA funds may be used for a wide range of housing, social services, program planning, and development costs. These include, but are not limited to: acquisition; rehabilitation; or new construction of housing units; costs for facility operations; rental assistance; and short-term payments to prevent homelessness. HOPWA funds also may be used for supportive social services, including: health care; mental health services; chemical dependency treatment; nutritional services; case management; assistance with daily living; and other supportive services. A-56 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Many beneﬁciaries receive supportive services that are funded by HOPWA or other related public and private programs. In fact, states and cities have tended to leverage approximately two dollars for every one dollar provided by the HOPWA program. Ninety percent (90%) of program funds are distributed under a formula that is based on AIDS surveillance information from the Centers for Disease Control and Prevention (CDC), including cumulative AIDS cases and area incidence. In Fiscal Year 2006, a total of $256.2 million was allocated by formula to 122 grantees, to the qualifying cities and one county for 83 eligible metropolitan statistical areas (EMSAs) and to 39 eligible states for areas outside of EMSAs. Eligible formula areas have at least 1,500 cumulative cases of AIDS, as of March 31, a population of at least 500,000 and have a HUD-approved Consolidated Plan. One-quarter of the formula is awarded for metropolitan areas that have a higher than average per capita incidence of AIDS. A description of the areas and allocation data for each HOPWA formula program can be found at: www.hud.gov/ofﬁces/cpd/aidshousing/programs/formula. Federal HOPWA Funding 2004-2006 (In millions $) Fiscal Formula Competitive Technical Year Allocations Grants Assistance Total 2004 263.1 29.2 2.5 294.7 2005 251.3 27.9 2.4 281.7 2006 256.2 28.5 1.5 286.1 Since 1992, the Federal government has made available over $ 2.3 billion in HOPWA funds to support community efforts to create and operate HIV/AIDS housing initiatives. A statutory requirement of the HOPWA program is that formula allocations are administered by the largest municipality in the planning area. Accordingly, the City of Riverside was designated a formula grantee in 1993. Its Fiscal Year 2006 allocation of $1,684,000 is allotted to agencies throughout both Riverside and San Bernardino Counties. Program Accomplishments Activities carried out with HOPWA funds include housing rental assistance, utility payments, acquisition and rehabilitation, home health care and counseling. The City of Riverside contracts with the Riverside County Housing Authority and the San Bernardino County A-57 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Public Health Department to administer funds delivered by Project Sponsors selected on the basis of demonstrated background and experience in program delivery to HIV/AIDS patients. The provision of housing has been identiﬁed as the highest priority service need for HOPWA funds. The housing services are also funded through this program, including: assistance with short-term rent, mortgage and utility payments and information services. This program also funds the following supportive services: health care, home health services, and case management. For additional information, contact: Tranda Drumwright Housing and Community Development Manager 3900 Main St., 5th Floor Riverside, CA 92522 Phone: 951-826-5608 Fax: 951-826-5744 A-58 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Administrative Agencies Federal: • U.S. Department of Veterans Affairs (VA): Health Care for Homeless Veterans (HCHV) Programs (202) 273-5764 www.va.gov/homeless/ Type Of Assistance Authorization/mandate to Regional VA Medical Centers to provide clinical and case management services to homeless veterans linked to housing Program Description Unlike many other services systems, the Department of Veterans Affairs (VA) provides, rather than subcontracts out for many of the services commonly found in supportive housing for homeless veterans. Some of the VA’s homeless programs are designed to leverage the case management, primary and behavioral health care, and other services the VA provides to homeless veterans with housing provided by others. The HUD-VA Supported Housing Program and the VA Supported Housing Program are two such programs. Begun in 1992, the HUD-VASH program is a partnership between HUD and the VA to further the objectives of serving veterans who are homeless and mentally ill and those with substance abuse disorders by closely linking two interventions: (1) Permanent affordable housing through the provision of housing subsidies from a special needs set-aside of HUD’s Housing Choice Voucher Program (Section 8); and (2) Community-oriented outreach, clinical care and case management services. A-59 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Through 2002, HUD funded three rounds of almost 600 vouchers each (a total of 1,753) for this special needs Section 8 program. (See the Introduction to the Operating section for more information about how the special needs Section 8 programs work.) At the same time, VA medical centers formed clinical case management teams at 34 sites, usually social workers or nurses to provide outreach, clinical care and case management services to the veterans housed through the program. VA Supported Housing Program: Like the HUD-VASH Program outlined above, staff in VA’s Supported Housing Program provide ongoing case management services to homeless veterans, with an emphasis on securing long-term transitional or permanent housing and assisting veterans in retaining that housing. Emphasis is placed on helping veterans ﬁnd permanent housing and providing clinical support needed to keep veterans in permanent housing. Staff in these programs operates without beneﬁt of the especially dedicated Section 8 housing vouchers available in the HUD-VASH program, but are often successful in locating transitional or permanent housing through local means, especially by collaborating with Veterans Service Organizations. VA staff work with private landlords, public housing authorities and nonproﬁt organizations to ﬁnd housing arrangements. For supportive housing sponsors serving homeless veterans with mental health and substance use issues, both of these programs can be sources of in-kind clinical care and case management services linked to or provided on-site in supportive housing. Essentially these programs are authorizations for VA Medical Centers and Supported Housing Program sites to provide clinical care and case management services to homeless veterans. To facilitate services to homeless veterans, each of the VA’s 206 Vet Centers has an identiﬁed staff person who functions as a homeless veterans’ coordinator. Eligible Target Populations: HUD-VASH Program: Homeless veterans with mental illness and/or those suffering from substance abuse disorders. VA Supported Housing Program: Homeless veterans. A-60 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Eligible Projects/Programs: HUD-VASH Program: any project/program that has access to Section 8 vouchers through this set-aside program (or because the local public housing authority has established a preference for veterans within their existing mainstream Section 8 program) is eligible to request clinical care and case management services from the VA. VA Supported Housing Program: any project/program serving homeless veterans. Eligible Applicants/Sponsors: Programs serving the target population. Application Process HUD-VASH Program: The best way to access these resources is by contacting the local Public Housing Authority to determine if there are HUD-VASH vouchers and/or if it has a preference for veterans. If either is the case in your community, after developing a partnership with the housing authority about how the two interventions would be coordinated, contact the Homeless Coordinator in the Regional Ofﬁce of the VA (www.va.gov/homeless/index. cfm) , go to Homeless Programs and Initiatives, and click on Homeless Veteran Program Coordinators for access to state by state listings.) VA Supported Housing Program. The best way to access these resources is to contact the Homeless Coordinator in the Regional Ofﬁce of the VA. (Go to Homeless Programs and Initiatives, and click on Homeless Veteran Program Coordinators for access to state by state listings.) (www.va.gov/homeless/index.cfm) CFDA Code: N/A Authorizing Legislation/statute: HUD-VASH: Section 12 of Public Law 107-95 Regulations/Guidelines: N/A Additional Resources For more information about the services provided to homeless veterans through the Veterans Health Administration, go to the “VA Homeless Coordinators” page on the VA website at www.va.gov/homeless/. The Homeless Coordinator at each Homeless Veteran Coordinator A-61 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Ofﬁce can provide information about the services for Homeless Veterans provided through the Veterans Health Administration. Services include outreach, case management, referrals to beneﬁts counselors, linkage to health care and housing assistance. Each facility is unique and services vary among each medical center. To ﬁnd the Homeless Coordinator in your area, go to the “VA Homeless Coordinators” page on the VA website at www.va.gov/homeless/. A-62 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The California Tax Credit Allocation Committee (“Committee” or “TCAC”) administers two low income housing tax credit programs – a federal program and a state program. Both programs were authorized to encourage private investment in affordable rental housing for households meeting certain income requirements. The Committee has seven members, including three voting members and four advisors. The voting members include the State Treasurer, who serves as chairman, the State Controller, and the Governor, who may choose to designate the Director of the Department of Finance as his representative. The non-voting members are the Executive Director of the California Housing Finance Agency, the Director of the Department of Housing and Community Development, and two representatives of local governments. One local representative must be associated with a city and is appointed by the Speaker of the Assembly. The other member is a county representative appointed by the Senate Rules Committee. The Federal Program Congress created the federal Low Income Housing Tax Credit Program in 1986. It replaced traditional housing tax incentives, such as accelerated depreciation, with a tax credit that enables low-income housing sponsors and developers to raise project equity through the sale of tax beneﬁts to investors. Two types of federal tax credits are available and are generally referred to as nine percent (9%) and four percent (4%) credits. These terms refer to the approximate percentage of a project’s “qualiﬁed basis” a taxpayer may deduct from their annual federal tax liability in each of ten years. (See “How Credit Amounts are Calculated” below). The program is regulated through Internal Revenue Code Section 42, and is administered by the Internal Revenue Service, which is part of the U.S. Treasury Department. Section 42 speciﬁes that each state must designate a “housing credit agency” to administer the Credit program. In California, responsibility for administering the program was assigned to the California Tax Credit Allocation Committee (TCAC), ﬁrst by a February 1987 gubernatorial A-63 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY proclamation, and later by enactment of SB 113, Chapter 658, and Statutes of 1987. The federal tax credit program was granted permanent status with passage of the Omnibus Budget Reconciliation Act of 1993. The State Program Recognizing the extremely high cost of developing housing in California, the state legislature authorized a state low income housing tax credit program to augment the federal tax credit program. Authorized by Chapter 1138, Statutes of 1987, the state credit is only available to a project which has previously received, or is concurrently receiving, an allocation of federal credits. Thus the state program does not stand alone, but instead, supplements the federal tax credit program. Annual Federal Credits Available For 2006, each state has an annual housing credit ceiling of $1.90 per capita for nine percent (9%) Low Income Housing Tax Credits. In addition, States may qualify for a pro rata share of credits available annually in a national pool comprised of states’ unused credits. Also, any credits returned to a state from a credit recipient may be allocated to new projects. From the total ceiling amount available to California, the Committee allocates credit amounts based upon assessments of eligible project costs, as deﬁned by IRC Section 42. The housing sponsor uses or sells ten times the allocation amount, since investors can take the annual credit each year for a ten-year period. Although the credit is taken over a ten-year period, the Internal Revenue Code requires that the project remain in compliance for at least 30 years. Annual State Credits Available The annual state credit ceiling is currently $72,992,217 and would be increased by any unused or returned credits from previous years. Investors claim the state credit over a four- year period, rather than the ten-year federal allocation period. The full four-year state credit allocated to a project is deducted from the $70 million state ceiling, while only the annual federal credit allocated to a project is deducted from the federal ceiling. A-64 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Tax-Exempt Bond Financed Projects Developments ﬁnanced with the proceeds of tax-exempt bonds may also receive federal tax credit. In this instance, the developer/owner of a tax-exempt development must apply to the Committee and must meet both the federal and state statutory and regulatory requirements. The tax credits available are tied to the private activity bond cap limits, but are not deducted from the state’s annual tax credit ceiling. The annual credit available is based on approximately four percent (4%) (instead of nine percent [9%]) of the “qualiﬁed basis” of the development. Qualiﬁed basis consists of the costs attributable to the units that will be income and rent restricted for a minimum of 30 years. Eligible Projects Only rental housing projects are eligible for tax credits in both the federal and state programs. Credits can be allocated to new construction projects or existing properties undergoing rehabilitation. Nine percent (9%) credits are allocated on a competitive basis so that those meeting the highest housing priorities and public policy objectives, as determined by the Committee, have ﬁrst access to credits. Those utilizing tax credits must own the project for which the credits are awarded. Rent and Income Restrictions The programs have both rent and income restrictions. Rents on tax credit units cannot exceed 30 percent of an imputed income based on one and one half persons per bedroom (i.e., in a two-bedroom unit, the income of a three-person household is used to calculate rent, regardless of the actual family size of the household). Federal law requires that the initial incomes of households in tax credit units not exceed either 60 percent or 50 percent of the area median income, adjusted for household size. When a project developer or sponsor applies for tax credits, he or she irrevocably elects one of the following minimum federal set-aside requirements: • a minimum of 40 percent of the units must be both rent-restricted and occupied by households whose incomes are 60 percent or less of the area median gross income, adjusted for family size, or • 20 percent of the units must be both rent-restricted and occupied by households whose incomes are 50 percent or less of the area median gross income, adjusted for family size. A-65 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Despite this minimum set-aside election, most project sponsors designate all of the units in a project for occupancy by low-income households, since credits are allocated only for restricted units. For instance, if a developer builds a project in which half of the units are market-rate and half are affordable, only half of the eligible project costs would be considered when determining how much credit may be allocated. Additionally, as described below, sponsors generally target a certain number of units to tenants with incomes below 60 percent or 50 percent of median to compete successfully. Under federal law, credit projects must remain affordable for at least 30 years; however, California law generally requires a 55-year extended use period for nine percent (9%) tax credit projects. Also, four percent (4%) tax credit recipients frequently access signiﬁcant boosts to their basis limits by agreeing to 55-year extended use restrictions. Regulatory agreements are recorded against each tax credit project to ensure compliance. Determination of Credit Need As required by federal law, the Committee performs feasibility analyses on every project to ensure that allocations do not exceed the amount required for project feasibility. While a project’s qualiﬁed basis determines a maximum credit allocation, only the amount needed to ﬁll the ﬁnancing shortfall may be allocated. The Committee must consider the sources and uses of funds and the total ﬁnancing planned for the development, including the projected proceeds to be generated by the sale of tax credits. The Committee must also determine the reasonableness of estimated development, operational and intermediary costs. For each project, the amount of credits needed must be determined at least three times; at application, allocation, and placed-in-service. How Credit Amounts Are Calculated In determining the amount of credit for which a project may be eligible, ﬁrst, total project cost is calculated. Secondly, “eligible basis” is determined by subtracting non-depreciable costs, such as land, permanent ﬁnancing costs, rent reserves and marketing costs. The project developer may also voluntarily reduce the requested eligible basis in order to gain a competitive advantage. If the development is located in a HUD-designated Difﬁcult to A-66 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Develop Area (DDA) or Qualiﬁed Census Tract (QCT), the eligible basis receives a 130 percent adjustment. Next, the eligible basis is multiplied by the “applicable fraction”, which is the smaller of (1) the percentage of low-income units to total units, or, (2) the percentage of square footage of the low-income units to the square footage of the total units. This ﬁgure is known as the “qualiﬁed basis” of the project. The qualiﬁed basis is multiplied by the federal tax credit rate, published monthly by the IRS, to determine the maximum allowable tax credit allocation. For projects that are new construction or rehabilitation, which are not ﬁnanced with a federal subsidy, the rate is summarized as nine percent (9%). For projects involving a federal subsidy (including projects ﬁnanced more than 50 percent with tax exempt bonds), the rate is summarized as four percent (4%). Due to the ﬂuctuating federal tax credit rate published monthly by the IRS, TCAC currently uses an eight and one-tenths percent (8.1%) and three and one half percent (3.5%) rate to determine a project’s initial tax credit reservation. A project’s ﬁnal (placed-in-service) tax credit allocation is based on actual project sources and uses of funds, the ﬁnancing shortfall and the actual applicable federal rate. The rate applicable to a project is the rate published for the month each building is placed in service or in an earlier month elected by the sponsor. The allocation cannot exceed the initial reservation amount and may be reduced if an analysis determines that the maximum allowable amount would generate excess equity proceeds to the project. Raising Equity Investment Most credits are sold to corporate or individual investors through public or private syndication. Investors beneﬁt from the tax credit by purchasing an ownership interest in one or more tax credit housing projects. In turn, investors claim a dollar-for-dollar credit against their tax liability over a ten-year period. Partnership equity contributed to the project in exchange for the credit typically ﬁnances 30-60 percent of the capital costs of project construction. The net amount of equity proceeds contributed to a project is based on investor contributions (the present value of the ten-year credit) less syndication overhead and fees and other related costs. The Committee uses the net tax credit factor (net proceeds divided by the total 10-year tax credit allocation) to determine the credit amount needed. A-67 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY California’s tax credit program was structured to mirror the federal program with certain exceptions. In addition to the state credit only being available to projects which also receive a federal credit, other differences include: • TCAC gives priority for state credit allocations to projects not located in a Difﬁcult to Develop Area or Qualiﬁed Census Tract and those using HOME funds to ﬁnance eligible costs. • The applicable percentage to be applied to the qualiﬁed basis for determining the amount of state credits is 30 percent for projects which are not federally subsidized, and 13 percent for projects which are federally subsidized, in contrast to nine percent (9%) and four percent (4%) for the federal credit. • State credits are not available for acquisition costs, except for previously subsidized projects that qualify as “at-risk” of being converted to market rate. • The state program has a rate of return limitation. Any surplus revenues generated above the limitation must be used to reduce rents. Federal Preference and Selection Criteria Each state agency is responsible for designing and implementing its housing tax credit program in accordance with requirements of the Internal Revenue Code and its own particular state housing needs. The Internal Revenue Code sets broad parameters that must be considered by each state in its “Qualiﬁed Allocation Plan” (QAP), adopted after public hearings and input that sets forth the state’s program. Section 42, for example, requires that each state give preference to projects that serve the lowest income tenants, projects obligated to serve qualiﬁed low income tenants for the longest period of time, and projects located in qualiﬁed census tracts that contribute to a concerted community revitalization plan. Additionally, the following selection criteria must be considered by each state in awarding credit: project location, housing needs characteristics, project characteristics, tenant populations with special housing needs, public housing waiting lists, tenant populations of individuals with children, and projects intended for eventual tenant ownership. California’s Program In California, the demand for housing tax credit has recently exceeded the supply by approximately two to one (2:1). This means, of course, many good, worthwhile projects are A-68 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY unable to be awarded credit. It also means a rather elaborate set of legal and regulatory rules for determining what projects are awarded credit has been established. State and federal law require at least 10 percent of the annual credit be awarded to projects that materially involve nonproﬁts. State law also requires 20 percent of the annual credit be awarded to projects located in rural areas of the state, and two percent (2%) of the credit be set-aside for “Small Development” projects of 20 or fewer units. Additionally, to assure geographic distribution of the tax credit, a certain percentage of credit is awarded each year to projects located in twelve geographic regions of the state. Public policies encouraging smart growth principles, energy efﬁciencies, and the like are part of California’s housing tax credit program. In its competitive scoring system, points are awarded for a variety of items, ranging from serving lower income tenants, to achieving energy efﬁciency, to the degree that the project will contribute to revitalization efforts in the area where it will be located. Threshold criteria require that the applicant show the following: (a) the type of housing proposed is needed and affordable to the targeted population within the community in which it is to be located; (b) enforceable ﬁnancing commitments of at least 50 percent of the total estimated ﬁnancing need; (c) control of the site; (d) compliance with all applicable local land use and zoning ordinances; (e) development team experience and ﬁnancial capacity to ensure project completion and operation for the extended use period; (f) ﬁnancial viability throughout the compliance period of the project; (g) minimum construction standards; (h) all deferred-payment ﬁnancing, grants, and subsidies be “committed” at application; and (i) new construction projects using nine percent (9%) tax credits are limited to no more than 150 units for non-rural set-aside applications, and 80 units for rural set-aside applications. In addition, targeted projects must meet additional threshold requirements applicable to the targeted populations they are intended to serve. These additional threshold requirements can be found in the Regulations. Application Cycles and TCAC Review Process State law requires the Committee to hold two or more application cycles each year for awarding nine percent (9%) tax credits, unless circumstances warrant a reduction in the number of cycles. The funding schedule generally allows for a ﬁrst round due date in late March and a second round due date in late July. A-69 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Application Process TCAC has prepared an application package to help applicants to present clearly their project’s characteristics. Staff reviews the application to determine the reasonableness of project costs, the maximum allowable tax credit allocation, and the amount of credit needed for ﬁnancial feasibility. The application review process generally takes about sixty days to complete. Point System for Ranking and Scoring Applications TCAC receives far more applications for tax credit than it has authority to award. Generally, the demand is roughly twice the supply of available credit. For that reason, the Committee, in 1999, implemented a point system by which to rank applications. Although it is somewhat complicated by the overlay of statutory set-asides and geographical apportionments, the basic point structure advantages applications that show evidence of leveraging public and some private funds, projects for which the owner and management company have previous affordable housing experience, projects that have location amenities (for example, being located by a public transit stop), projects that will offer tenants various service amenities (for example, after school computer classes), projects serving the lowest income tenants, “mixed income” projects that have a non-tax credit component of renters, projects that are ready to proceed, projects that attain energy efﬁciencies, and projects that contribute to neighborhood revitalization. (See the regulations for a fuller explanation.) Stages of Tax Credit Reservation Federal law has stringent requirements for making allocations and placing projects in service. A slip in timing could cause the state to lose credits and not be able to access unused credits from other states. It is for this reason that the Committee has established progress requirements that ensure California is in compliance with federal law. (1) Preliminary Reservation - Generally, when applications are submitted to TCAC, projects are not yet ready to begin construction and the applicant seeks a Preliminary Reservation. (2) Final Reservation - Project sponsors receive a Final Reservation when all conditions of the Preliminary Reservation have been met. The construction loan must be funded, permanent ﬁnancing and any other ﬁnancing required to complete the project must be A-70 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY committed, and a partnership agreement must be executed. A second feasibility analysis is completed. This reservation is in effect during the project’s construction period. (3) Carryover Allocation - An applicant may obtain a Carryover Allocation prior to or after a Final Reservation, depending upon the time constraints imposed by federal law. Federal law requires that a Carryover Allocation be obtained if a project will not be placed-in- service in the same year the project receives a reservation. Once a Carryover Allocation is made, project owners have until December 31 of the second calendar year after the year in which the Carryover Allocation is made to place the project in service. (4) Issuance of Tax Forms - This is accomplished when conditions of the Final Reservation have been met, the project is “placed in service”, or ready for occupancy, and the owner submits various documentation to TCAC for review. TCAC issues IRS Form 8609 (and the state Form FTB 3521A, if applicable) after performing a ﬁnal feasibility and cost reasonableness analysis to determine the requisite amount of tax credits needed. The ﬁnal analysis is based on an audited cost certiﬁcation prepared by the owner’s accountant. One tax form will be issued for each residential building in a project. Before the tax forms are issued, the applicant must enter into a regulatory agreement with TCAC. This agreement is recorded against the land and holds the project owner to the speciﬁcations and characteristics of the project on which the tax credit reservation was awarded (rent and income restrictions, selection criteria, preference points and other requirements). Compliance Monitoring The Committee administers a compliance monitoring program involving all projects with an allocation of federal or state housing tax credits. Projects are monitored according to the requirements of Section 42, IRS regulations, and the terms of the regulatory agreement entered into between the owner and the Committee. Each project will have a site visit from TCAC staff or its agent every three years. During this visit, tenant ﬁles and rent rolls will be examined to assure that the incomes and rents are properly restricted. Other items to be inspected include promised amenities as well as the physical conditions of the development and its units. The Commercial Revitalization Deduction Program AB 2010, signed into law in September 2002, designates the California Tax Credit Allocation Committee as California’s Commercial Revitalization agency for the purpose of allocating A-71 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY federally authorized Commercial Revitalization deductions to qualiﬁed businesses located in California’s ﬁve federally designated Renewal Communities. The ﬁve communities include the rural communities of Orange Cove and Parlier, and certain census tracts in the cities of Los Angeles, San Diego, and San Francisco. The deduction is available to businesses located in these Renewal Communities that purchase, build, or renovate property for commercial use. It must be allocated by the Committee, pursuant to a Qualiﬁed Allocation Plan that the Committee has adopted, and can be claimed, once allocated, at the taxpayer’s election, either in the amount of 50 percent of the qualiﬁed costs in the ﬁrst year after the building is placed in service, or at the rate of 10 percent per year for 10 years, beginning in the year the building is placed in service. A total of $12 million in deductions is available to each Renewal Community for each year beginning in 2002 and ending in 2009. In 2005, the Committee allocated a total of $2.9 million in deductions to four such projects. A-72 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Administrative Agencies Federal: • Department of Health and Human Services: Centers for Medicare and Medicaid Services (CMS) (410) 786-3870 www.cms.gov/medicaid California: • California Department of Health Services (DHS): Medical Care Services (MCS) (916) 440-7800 www.dhs.ca.gov/mcs/MedicalInformation/Med.htm and www.medi-cal.ca.gov Type of Assistance: Formula Program Description The information in this summary is signiﬁcantly drawn from the Corporation for Supportive Housing’s white papers issued under its Medicaid Project. For more detailed information, see the white papers titled “Medicaid in Supportive Housing: Lessons for Policy-Makers,” “The Basics of the Federal/State Medicaid Program” and “Current Opportunities for Medicaid Financing” issued in March-April 2003 and available on their website at www.csh.org. Federal: Medicaid is a Federal entitlement program, matched by state and local dollars, that funds health care for low-income families and disabled or elderly individuals. The Medicaid health care reimbursement program is jointly funded and administered by the Federal and state governments. In layperson’s terms, Medicaid is an insurance plan that has two payers -- the Federal and state governments. That is, when a person insured by Medicaid gets sick and goes to a provider that accepts Medicaid for health services, payment for those services is provided A-73 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY by a combination of funding from the state and Federal governments. (The provider bills the appropriate unit of state government and is paid by the state, at a price or “rate” set by the state, with a combination of state and Federal funds.) Working within parameters deﬁned by Federal law and administrative rules, each state develops a State Medicaid plan that deﬁnes: • Who is eligible for Medicaid coverage; • What kinds of services are covered under Medicaid (i.e., basic health services plus state options, the deﬁnition of “medical necessity,” where services must be provided); • Who can provide services to be paid by Medicaid; • Rate structure (i.e., fee-for-service, case rates, capitation, etc.); and, • Other applicable requirements including billing procedures, record-keeping, and other administrative provisions. Federal law establishes some requirements but many important provisions are established under Medicaid “options” that are allowed but not required. Most states have enacted Medicaid program changes to require or allow some or all Medicaid recipients to enroll in managed care plans. Although most Federal requirements apply regardless of whether the recipient is in a managed care or fee-for-service setting, the application of these rules may shift from the state to managed care organizations. In addition, many states have obtained Federal waivers to “carve out” mental health services, or other services, separating the administration of these beneﬁts from provisions which govern and reimburse the delivery of other Medicaid beneﬁts. A carve-out may allow a state mental health agency to establish managed care programs (which may be administered by county government or a local mental health authority) or otherwise limit service providers’ ability to obtain Medicaid reimbursement for a deﬁned set of covered beneﬁts. In that the primary way Medicaid can pay for services provided in supportive housing is under beneﬁts around mental health services, carve-out arrangements may impact the administration of Medicaid beneﬁts for services provided in supportive housing. Carve-out arrangements can result in a confusing division of health care services or undermine the integrated delivery of health care including “wraparound services.” The A-74 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY supportive housing provider may be able to contract with a state or county mental health department (or a managed care organization) to provide, for example, rehabilitation services to tenants. But another public or private agency may have responsibility for approving tenants’ psychotropic prescriptions and/or hospital services; medical care may be provided by yet another agency using a different set of administrative procedures. Because these arrangements vary from state to state, supportive housing sponsors will need to determine how each of the beneﬁts they are to provide is administered. Despite the challenges of using the Medicaid program to fund services in supportive housing, there are numerous examples of governments and providers doing so; Medicaid is increasingly being viewed as a reliable source of funding for services for residents of supportive housing with a range of health care needs, particularly if the resident population includes signiﬁcant numbers of persons with mental illness. There are several ways Medicaid can be used to fund some of the services provided to supportive housing tenants. Strategies currently in use or being explored in some states include funding services through: • The Rehabilitation Option • The Targeted Case Management (TCM) Option • A combination of these ﬁrst two options to fund Assertive Community Treatment (ACT) programs and other client-centered services • Partnerships with Federally Qualiﬁed Health Centers (FQHCs) • Home and Community Based Services 1915(c) waivers • Other Federal waivers • The Assisted Living and Personal Care Option. The two most successful strategies to date have been the Rehabilitation Option and partnering with FQHCs to provide health and mental health services to supportive housing residents. A-75 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY California: Medi-Cal is California’s Medicaid health care program. Local county welfare/social services departments manage Medi-Cal eligibility determinations. In California, specialty mental health services were carved out from the provision of other Medicaid covered beneﬁts. The State gives the counties a ﬁxed amount of state funding, based on the amount the State was paying to match Federal funds for Medicaid-covered mental health services in past years. The counties are responsible for providing (or contracting for the delivery of) specialty mental health services, including mental health services covered by Medi-Cal, and for paying the State’s share to match Medicaid reimbursements from the Federal government. In essence, the counties operate de facto mental health managed care plans wherein they contract with a limited number of providers to provide these services, through which Medi-Cal recipients access these services. (Note: counties also have to provide or pay for mental health service to other indigent patients not insured by Medi-Cal in certain circumstances.) There are two exceptions to the mental health carve-out arrangement in California: (1) Primary care providers are still able to provide mental health-related services that fall under primary care, e.g., prescription of anti-depression medication. (2) Federally Qualiﬁed Health Centers (FQHCs), generally community clinics or Health Care for the Homeless programs, can deliver primary care and specialty mental health services separate from the county’s managed care system. In such instances, FQHCs are paid for those services through an arrangement that pays for visits by licensed clinicians (including physicians, nurse practitioners, psychiatrists, and LCSW’s). It is important to note that FQHC reimbursement rates are relatively high because they are designed to capture all of the costs associated with comprehensive care for vulnerable patients. Eligible Target Populations: Federal law deﬁnes Medicaid eligibility in terms of “categorical” and “ﬁnancial” criteria. To establish eligibility, an individual must meet both criteria. Categorical criteria describe population groups that are eligible; ﬁnancial criteria require that recipients’ income and resources do not exceed state limits set for each group. In addition, a Medicaid recipient must be a citizen or have appropriate immigration status, and must be a resident of the state paying for the services. A-76 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Federal law requires states to provide coverage to some “mandatory” groups, while allowing states ﬂexibility to extend or restrict coverage for other “optional” groups. Mandatory groups include: pregnant women; children; low-income families with children; aged, blind and disabled individuals; and, low-income, elderly Medicare beneﬁciaries. (Low-income parents and children are often eligible even if not receiving welfare/TANF beneﬁts, but often they do not apply.) Optional groups include: aged, blind or disabled individuals who meet income and resource requirements of the SSI program but do not actually receive beneﬁts; persons enrolled in special home and community-based waiver programs; institutionalized individuals with certain income limitations; and, disabled children 18 years and younger who would be eligible if in an institution. The complex eligibility rules vary widely from state to state and therefore the state Medicaid plan should be consulted for state-speciﬁc eligibility rules. For service providers serving homeless people or supportive housing tenants, it is important to understand that very low-income adults who are not “disabled” as deﬁned by SSI eligibility standards, and who do not have or are not living with dependent children, are generally not eligible for Medicaid. (There are exceptions in a few states with 1115 waivers.) This group includes adults who have health conditions or disabilities that are primarily attributable to substance abuse (which since 1996 has been excluded from SSI eligibility.) In addition, the following groups have limited or no eligibility for Medicaid: immigrants, people with asymptomatic HIV, and incarcerated people. In addition to these mandated, optional and ineligible groups, states may choose to offer Medicaid coverage to medically needy persons, disabled individuals who work and other groups covered under a Federal Medicaid demonstration waiver. (For example, states have the option to extend eligibility for people who qualify for SSI, based on disability level, but have earnings from work.) Eligible Projects/Programs: As mentioned above, there are several promising strategies for using Medicaid in supportive housing: Rehabilitation Option: Under the “rehab option,” supportive housing providers can obtain reimbursement for services intended to restore the skills tenants need to live independently and to improve functioning impaired by mental illness (or in some states, chemical addiction.) Some key issues related to using the rehab option are: A-77 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • To qualify for reimbursement, services must be related to the tenant’s identiﬁed diagnosis and based upon an individualized plan of care. • Some covered services can be delivered by staff with a broad range of skills and training levels, subject to appropriate clinical oversight. • Only some of the supportive housing tenants covered by Medicaid will be eligible for rehabilitation services, based on diagnosed mental illness or other medical necessity criteria established by the state. Most supportive housing providers that currently rely on Medicaid reimbursement for rehab option services are nonproﬁt agencies that also deliver Medicaid-reimbursed services in other settings, or have previously established contracts with local or state mental health (or behavioral care) authorities for residential, outpatient, or case management programs. (1) Targeted Case Management Option: Some states have established targeted case management (TCM) beneﬁts that appear to match the service needs of many supportive housing tenants. However there is limited experience using this option to pay for supportive housing services. The TCM option provides Medicaid coverage for assessment, goal-setting, and ﬂexible services that help tenants gain access to other needed medical, social, and education services or beneﬁts, especially when they allow them to utilize necessary health services. (2) Partnerships with Federally Qualiﬁed Health Centers (FQHCs): FQHCs (including community clinics and Health Care for the Homeless Programs) can partner with housing providers to deliver services to meet tenants’ needs for health care, including health education and mental health or substance abuse treatment services. This strategy has some advantages: FQHC providers can use other grant funding; and FQHC providers often qualify for Medicaid reimbursement at rates that are higher than those available to other health care providers, in order to ﬁnance a more comprehensive array of services to patients with complex health and social services needs. (3) Medicaid Waivers: Waivers of Federal rules allow states to use Medicaid in more creative ways. Some states have obtained waivers to expand Medicaid coverage to individuals who would not otherwise be eligible. For example, Massachusetts obtained a waiver to extend coverage to some very low-income adults without children, including people experiencing long-term unemployment and those with HIV who do not currently A-78 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY qualify for SSI based on disability. Michigan used a waiver to establish prepaid health plans, administered by county-sponsored mental health agencies. Theses plans have implemented “person-centered planning” for consumers with mental illness or chemical addiction. They have also established a structured partnership at state and local levels that facilitates the production of supportive housing and uses Medicaid ﬁnancing to pay for ﬂexible community living supports. Although providing numerous opportunities for ﬂexible, creative approaches, Medicaid waivers require signiﬁcant investment, leadership, and creativity to make them work for supportive housing. Eligible Use of Funds & Use Restrictions: In order to receive Federal Medicaid funding, states must offer basic services to the mandatory, categorically needy populations described above under Target Populations. Federal law requires all states to provide Medicaid reimbursement for a broad array of clinical health services. These “mandatory” services include hospital and physician services; certain dental services; nursing facility and home health care; family planning; and related laboratory test and X-rays. States also receive Federal matching funds for “optional” Medicaid services they may choose to cover, e.g., clinic services, prescription drugs, etc., within a wide range of federally allowed options regarding eligibility, covered beneﬁts and other program speciﬁcations. All reimbursed services must be deemed “medically necessary” (although the speciﬁc criteria and procedures used to apply this rule vary among states and types of services.) Each State’s interpretation of Federally-mandated services and additional coverage it has elected to provide are laid out in its Medicaid plan. Many of the health, case management, and supportive services provided to supportive housing tenants appear to qualify for Medicaid reimbursement. To access Medicaid funding for supportive housing services, a supportive housing project must house Medicaid-eligible tenants, provide services that are Medicaid-fundable, and include a qualiﬁed service provider. Medicaid reimbursement requires that the client, the service, and the provider are all qualiﬁed as Medicaid-eligible, with the provider having sufﬁcient administrative capacity to meet state and Federal billing and record-keeping requirements. A-79 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Eligible Applicants/Sponsors: States receive Federal funds to match their expenditures for Medicaid-covered health care services. Within broad Federal guidelines, provider participation requirements vary widely from state to state. In order to bill for Medicaid, health care providers may complete a relatively simple certiﬁcation or registration process in one state or may be required to enter a detailed, executed contract in another. Administrative requirements will vary from state to state as the state determines the billing structure that providers must use. States may also delegate the administration of parts of the Medicaid program to local governments (particularly in large urban areas such as New York City, and in states, such as California, where counties play a large role in administering health and human services programs. Medicaid managed care plans may further deﬁne provider eligibility. Again, states outline their interpretation of Federal requirements and any additional requirements in the state Medicaid plan. In general four types of providers are relevant in terms of accessing Medicaid to pay for services to supportive housing tenants: (1) Federally Qualiﬁed Health Centers (FQHCs). FQHC is deﬁned as a clinic that serves populations in particular need of health care services, such as homeless and very low- income people. Many public and nonproﬁt community health centers and Health Care for the Homeless Programs, migrant health clinics, and primary care centers located in public housing qualify for designation as FQHCs. Programs are designated as FQHCs either because they receive a grant speciﬁcally for such care, or because they have demonstrated to the Federal public health service that they are serving the targeted high-need populations. FQHCs also serve uninsured persons and provide a wide range of necessary, non-medical services, such as social assistance or translation services. FQHCs receive Medicaid reimbursement for health care visits provided to Medicaid-eligible consumers by physicians, psychiatrists, and other mid-level medical practitioners, as well as qualiﬁed clinical social worker and psychologists. (2) Nonproﬁt community-based supportive housing agencies under contract with (or otherwise recognized as a Medicaid provider by) local or state governments. Although most supportive housing agencies are not eligible to directly bill Medicaid for health care services provided by their staff, states may allow these providers to receive Medicaid reimbursement through contracts with agencies that can bill for Medicaid services, usually state or local governments. Alternatively, some states allow providers A-80 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY to bill Medicaid without an established service contract, using instead procedures for provider certiﬁcation by a state or local government agency (or by a managed care entity under terms speciﬁed by the state.) (3) Nonproﬁt community-based supportive housing agencies not under contract with (or otherwise recognized as a Medicaid provider by) local or state governments. As noted, these agencies are generally not able to bill Medicaid, although state law may allow licensed or credentialed individual practitioners to bill for services provided in supportive housing settings. (4) Individual Providers. State laws establish the qualiﬁcations, requirements, and administrative process for the credentialing and/or licensing of clinical practitioners. In general, sates allow most types of licensed professionals, e.g., doctors, to participate in Medicaid. States deﬁne the settings and circumstances under which individual providers may bill for their services and require additional administrative procedures in order to become a Medicaid provider. Although a potentially a signiﬁcant funding stream for services for supportive housing tenants, Medicaid is a complicated program that requires sophisticated administrative and ﬁnancial capacity on the part of the provider. Supportive housing programs that have been most successful in using Medicaid to fund services have been those that include as the service provider an organization that has already been getting Medicaid reimbursement for more traditional reasons, e.g., a community clinic, Health Care for the Homeless provider, or a non-proﬁt agency already delivering outpatient or residential mental health services under contract with a county mental health department. Minimum/Maximum Awards: N/A Average Awards: N/A Term of Awards: States are awarded funds quarterly on a Federal ﬁscal year, based on their estimates of funds needed to provide medical assistance to the needy. A-81 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Matching Requirements: States receive Federal funds to match their expenditures for Medicaid-eligible health care, based on an allocation formula which renders the Federal share anywhere from 50 to 80 percent. In some states, local governments share responsibility for the state’s share of costs for some Medicaid covered beneﬁts. For Medicaid-eligible providers of services, there are no match requirements, although providers often need to utilize other funds to cover costs that exceed Medicaid payment rates, or for services to individuals who are not eligible for Medicaid beneﬁts. There are pre-determined reimbursement rates and in some cases some Medicaid beneﬁts are administered through managed care arrangements whereby providers receive a ﬁxed amount of resources per eligible beneﬁciary to provide a speciﬁc range of services. Formula: States receive Federal funds to match their expenditures for health care, based on an allocation formula that includes factors such as the state’s current ﬁscal year budget, the relative income level of the state’s population, etc. These criteria are used to determine the state’s match requirement for Medicaid funding. Application Process States apply to the Federal government making budgetary requests based on previous year Medicaid expenditures. The best ways for supportive housing providers to begin exploring using Medicaid reimbursements to fund services in supportive housing is by: a. Contacting the State or, in many places, the local public health or mental health agency; and/or b. Contacting a community clinic, Health Care for the Homeless program, or other health care provider that provides medical or mental health services to Medicaid beneﬁciaries, homeless people, and other low-income people. If Medicaid seems a likely funding process, supportive housing sponsors should begin to ensure that those tenants and prospective tenants who are Medicaid-eligible receive A-82 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY coverage. This oftentimes requires SSI advocacy, as some supportive housing tenants that are eligible for Medicaid have difﬁculty getting through the process and/or have been denied. CFDA Code: 93.778 Authorizing Legislation/statute: Social Security Act, Title XIX, as amended. Regulations: 42 CFR, Subchapter C Additional Resources • CSH published ﬁve white papers under the CSH Medicaid Project on the challenges and opportunities of using the Medicaid program to fund services in supportive housing. www. csh.org (Go to Resources, Funding Resources, Medicaid Resources 854) • “Casualties of Complexity, Why Eligible Homeless People are not Enrolled in Medicaid,” Patricia A. Post, National Health Care for the Homeless Council, 2001. (http://www. nhchc.org/Publications/) • “Recovery in the Community, Funding Mental Health Rehabilitative Approaches Under Medicaid,” Bazelon Center for Mental Health Law, 2001. • Center for Health Care Strategies has published two reports on homeless people accessing Medicaid through managed care. www.chcs.org • Links to state Medicaid pages can be found at: www.geocities.com/CapitolHill/5974. A-83 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The passage of Proposition 63 (now known as the Mental Health Services Act or MHSA) in November 2004, provides the ﬁrst opportunity in many years for the California Department of Mental Health (DMH) to provide increased funding, personnel and other resources to support county mental health programs and monitor progress toward statewide goals for children, transition age youth, adults, older adults and families. The Act addresses a broad continuum of prevention, early intervention and service needs and the necessary infrastructure, technology and training elements that will effectively support this system. This Act imposes a one percent (1%) income tax on personal income in excess of $1 million. Statewide, the Act was projected to generate approximately $254 million in ﬁscal year 2004- 2005, $683 million in 2005-2006 and increasing amounts thereafter. Much of the funding will be provided to county mental health programs to fund programs consistent with their local plans. Any uncommitted funds during ﬁscal year 2005-01006 will be used to establish county prudent reserve accounts as required by the Act. To provide for an orderly implementation of MHSA, DMH has planned for sequential phases of development for each of the six components of the Act. An extensive stakeholder process is being employed to inform the state’s implementation efforts. Improvement in client outcomes is a fundamental expectation throughout the implementation process. MHSACommunity Services and Supports Project Updates The State Department of Mental Health approved the Riverside County Community Services and Support (CSS) Plan in June 2006 thereby providing the resources necessary to begin implementation of the new MHSA services. The CSS Plan was developed through a twelve-month extensive community planning process that included 81 community focus groups, 20 specialty focus groups, four public forums, three public hearings and numerous written surveys. The Department estimates that it heard from over 1200 individuals in the planning process including consumers, family members, the court system, law enforcement agencies, human services agencies, and organizations and groups that advocate for and support the mentally health needs of our County residents. A-84 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Services through the CSS Plan will be community based, focused on recovery, culturally competent, and will include consumers and family members in treatment service provision. Funding can only be used for voluntary services and no less than 50 percent must be targeted to “full service partnerships” (FSP). FSP provides wrap-around services to help the most severely mentally ill clients and their families with access to assistance twenty-four hours a day, seven days a week. These wrap-around services include: psychiatric treatment; case management; transportation; housing; crisis intervention; education; vocational training and employment services; as well as socialization and recreational activities, based upon the individual needs for successful treatment outcomes. MHSA funds can not be used to supplant programs that existed prior to November 2004. The seriously mentally ill populations given priority for services includes the homeless, those in juvenile halls and jails, high-users of crisis and hospital services, and those at risk of institutionalization and placement. The programs through MHSA must include services for all ages and include: Children (0-16), Transition Age Youth (16-25), Adults (26-59), and Older Adults (60+). The CSS Plan includes six work plans that encompass the services to be provided to the priority population described above. • Community Collaboration • Cultural Competence • Client/Family Driven • Wellness and Recovery Focused • Integrated Services $16.7 million of MHSA funding is available each year to the County for community services and support to children and youth, transition age youth, adults and older adults. All four age groups must be served and ethnic disparities addressed. A-85 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Mission of Mental Health Services That the residents of Riverside County facing the challenge of severe mental illness have a quality of life that includes a reduction or absence of symptoms, meaningful relationships, activities, and choices, stable housing and employment in supportive communities free of stigma. Vision for a Transformed Mental Health System A transformed system would include all of the following characteristics: • User-friendly, easily accessible services across the county • Welcoming and engaging from point of ﬁrst contact • Services which are comprehensive, recovery focused and empowering • Integrated Peer Support System with consumer and family involvement at all levels • Active and continuous outreach to unserved populations with special attention to disparities in service use • Sensitive, respectful, and responsive to client’s culture, gender, age, sexual orientation, and ethnicity • Focused on the most effective clinical practices through a trained and supported workforce • Actively develops community partnerships, provide education to enhance community support and resources and to reduce stigma • Focused on consumer outcomes and utilizes feedback and evaluation to continually improve services. Plan for Community Services And Supports Building on the existing system, with a focus on transformation, the following is a summary of the draft plan: A-86 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY A. Proposed Priority Populations of Seriously Mentally Ill There was consistency across age groups of the populations who are priority to be served with two other populations tied only to a speciﬁc age group. 1. Homeless 2. Co-Occurring Disorders – Mental Illness and Substance Abuse 3. Juvenile Justice and Forensic populations 4. Adult & Transition age users of Hospital and Crisis Services. 5. High risk of hospitalization or institutionalization. 6. Co-Occurring Disorders Mental Illness and Health problems (Older Adults) 7. Very young children (0-5) B. Proposed Services Related to Homelessness Transition Age Youth (Ages 16-25): $1.85 Million of MHSA funds per year: • Three Integrated Service Recovery Centers (266 to be served per year) • Three Peer Support and Resource Centers (264 to be served per year) • Crisis Residential Program (45 to be served per year) • Augmented Board & Care, beds (30 to be served per year) • Evidence-based practices implemented in Children’s outpatient clinics serves the 16-18 year olds also Adults: $5.49 Million of MHSA funds per year: • Outreach • Three Mental Health Court programs (345 to be served per year) • Jail Mental Health Follow-up (2500 to be served per year) • Integrated Service Recovery (365 to be served per year) • Expansion of Family Advocate Program • Crisis Residential Program (235 to be served per year) • Augmented Board & Care - 82 beds (120 to be served per year) • Expanded Outpatient and Case Management Services (315 to be served per year) Older Adults: $2.34 Million of MHSA funds per year: • Infrastructure Changes – Designated Older Adult Managers and Supervisors • Multidisciplinary – Mobile Outreach & Integrated Service Team (350 provided assessment per year and 163 provided ongoing services) A-87 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • Peer & Family Support Services – Consumer and Family Advocates in each region plus Senior Peer Counseling (150 to be served by peer counseling) • Screening & Consultation in Public Health Clinics (250 to be served per year) • Augmented Board & Care (32 to be served per year) • Training of staff, consumers, and Board & Care staff (six trainings to be held per year) Peer Recovery/Support Services: $846,000 of MHSA Funds per year: • Three Consumer Operated Peer Support & Resource Centers (1200 served per year) • Consumer Advocate Position in Administrative Budget • Consumer/Family members on Mental Health Boards/Committees Outreach & Engagement: $265,000 of MHSA Funds per year: • General Community Outreach Strategies • Speciﬁc Targeted Ethnic Population Outreach Strategies • Outreach Coordinator One Time Funds: • Request has been made for one time funds to provide ongoing training and start up of programs. Additionally, $4.9 million has been requested to use under the CSS plan through ﬁscal year 2007-2008 to provide a range of housing options for transition age, adults and older adult populations Administration: $844,000 of MHSA Funds per year: • Includes MHSA Administrative & Support Staff, Housing Development Unit Staff, Research Analyst, and Consumer Advocate A-88 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Administrative Agencies Federal: • Department of Health and Human Services (HHS): Substance Abuse and Mental Health Services Administration (SAMHSA) Center for Substance Abuse Prevention (301) 443-2332 www.samhsa.gov or www.samhsa.gov/grants/grants.html Type Of Assistance: Competitive Program Description Competitive grant program to help community-based organizations expand their capacity to provide and sustain effective, integrated substance abuse prevention and HIV prevention services in high risk minority communities disproportionately impacted by the HIV/AIDS epidemic. The goal of this program is to increase access to substance abuse prevention and HIV prevention programs in areas with hard to reach populations and high incidence rates of substance abuse and HIV infection, such as rural communities, by increasing both the number and quality of prevention programs in traditionally under-served areas. The program is designed to be implemented in three phases: Phase I: Strategic Planning/Start-Up to deliver effective, integrated substance abuse prevention and HIV prevention services. (Not to exceed nine months). Phase II: Implementation activities including involvement of target population and community representatives, recruitment and retention of target population participants, and delivery of substance abuse prevention and HIV prevention services. A-89 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Phase III: Evaluation and Sustainability, including compiling, analyzing and reporting on the outcomes of the services delivered and completing the approved sustainability plan designed to ensure continuation of services. Eligible Target Populations: This program seeks to increase and sustain the availability of effective, integrated substance abuse prevention and HIV prevention services for women, youth and other at-risk populations in African-American, Hispanic/Latino, American Indian/Alaska Native, and Asian-American/Paciﬁc Islander communities which have traditionally been underserved or not served at all. Other at-risk populations may include: • Adolescents • Female adolescents and women • Runaway youth • Homeless individuals • Commercial sex workers • Individuals re-entering the community from prison, jail or juvenile justice facilities • Partners of individuals in or re-entering the community from correctional facilities • Gay, lesbian, bi-sexual, transgender and questioning individuals • Individuals, both male and female, with a history of sexual abuse or intimate partner violence • Migrant workers, or other immigrant populations living away from home for extended periods • Immigrants from countries with high HIV seroprevalence rates A-90 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Eligible Projects/Programs: Projects that increase the provision of effective substance abuse prevention and HIV prevention services; increase the number of community based organizations that provide such services; and increase the capacity of such organizations to successfully sustain their integrated prevention services. Eligible Use of Funds & Use Restrictions: Effective, integrated substance abuse prevention and HIV prevention services in high risk minority communities. Funds may not be used for: • Substance abuse treatment services • Mental health treatment services • HIV/AIDS treatment services • Primary health care services • Any services or treatments that would be covered under public or private programs such as Medicaid or Medicare Eligible Applicants/Sponsors: Domestic public and private non-proﬁt entities. State and local government agencies are not eligible. SAMHSA/CSAP intends to achieve overall program balance in terms of geography and race/ethnicity of target populations. An attempt will be made to distribute awards across all regions of the country and across all targeted minority groups; however, this funding criterion will be balanced against the priority score. Minimum/Maximum Awards: Maximum: $350,000 in total costs per year. Average Awards: FY 2003, $250,000 - 350,000 in total costs per year. A-91 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Term of Awards: Grants are awarded for up to ﬁve years. Annual continuation awards depend on the availability of funds and progress achieved. Matching Requirements: No cost sharing requirements, however, all successful applicants will develop and implement a sustainability plan to ensure continued provision of services subsequent to cessation of Federal funding. Formula: N/A Application Process: Annual NOFA with one application submission per year. Authorizing Legislation/statute: Public Health Services Act, Section 516 Regulations/guidelines 45 CFR Parts 74 and 92; PHS Grants Policy Statement; Last published Guidance for Applicants: No. SP 03-005 A-92 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Program description Program Summary MHP provides low-interest loans to developers of affordable housing. Available MHP General Funds may be used for multifamily rental and transitional housing projects involving new construction, rehabilitation, acquisition and rehabilitation, or conversion of nonresidential structures. HCD expects MHP funds to be leveraged with other resources, including local government funds, the federal Continuum of Care programs, four percent (4%) low-income housing tax credits, tax-exempt bond ﬁnancing and private debt ﬁnancing. Projects using nine percent (9%) tax credits are ineligible. Projects receiving funding from the Department’s Local Housing Trust Fund Matching Grant Program are not eligible to receive funds through MHP. Program Regulations and Legal Authority MHP was established by SB 1121, Statutes of 1999 (Alarcón), which created Chapter 6.7 of Part 2 of Division 31 commencing with Section 50675, of the Health and Safety Code. Applications are subject to two sets of regulations (the MHP-speciﬁc regulations and the Uniform Multifamily Regulations). The regulation text is available on the HCD website at: http://www.hcd.fa.gov/ca/multifamilyregs.html. Applications are also subject to the applicable statutory requirements, including those of Proposition 46 and SB 1227 of 2002 and the requirements speciﬁed in this NOFA.. Eligibility Information Eligible Project Sponsors Sponsors and borrowing entities may be organized on a for-proﬁt or not-for-proﬁt basis. Any individual, public agency or private entity capable of entering into a contract is eligible to apply, provided that they, or their staff, have successfully developed at least one affordable housing project. The Department will evaluate all Sponsors, including the roles of any general partner(s) in a limited partnership, to determine if the Sponsor’s roles, responsibilities, and beneﬁts in the project development and operations are commensurate with activities normally undertaken or controlled by project developers and owners. The Sponsor will be reviewed to determine if adequate stafﬁng levels exist to undertake and complete the project. A-93 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The same criteria will be applied to evaluate sponsor experience for purpose of awarding points. Sponsors of projects where at least 70 percent of the units consist of Special Needs Population units may be exempt from the requirement for previous development experience under limited conditions per Section 7303(d). Sponsor entities must maintain sufﬁcient control of the borrowing entity to ensure that the Ultimate Borrower has the resources and experience to develop, own and manage the project. Sponsors must have site control in the name of the Sponsor or an entity controlled by the Sponsor as deﬁned in UMR Section 8303. Eligible Uses of Funds MHP funds are provided as permanent ﬁnancing only, and may be used to take out construction loans used to cover normal project development (capital) costs, as detailed in Section 7304. MHP funds may be used to capitalize a project operating reserve account up to the limit required under UMR Section 8308. Program funds may not be used for the cost of supportive services, although Department-approved costs of on-site supportive services coordination may be treated as a project operating cost, payable from operating income. MHP funds must be attributable to the costs of “restricted” units (MHP units and units subject to a long-term regulatory agreement with occupancy and rent restrictions similar to those of MHP) or to the costs of facilities used for childcare, after-school care, and social services that are integrally linked to the restricted units. Eligible Projects Projects must qualify as rental housing developments, as deﬁned in UMR Section 8301, and meet the requirements of Section 7302. For example, projects must contain ﬁve or more dwelling units. MHP General funded units may be operated as permanent or transitional housing. Projects are ineligible if construction has commenced as of the application due date per Section 7302, or if the project is already fully funded. Projects must meet the underwriting standards described in UMR Section 8310. Maximum Loan Amounts The maximum loan per project is $10,000,000. The maximum loan amount per “restricted” unit is a function of unit size, location, and affordability level per Section 7307. The maximum loan per restricted unit has been increased to $45,000 per unit for the Southern California region to encourage the equitable distribution of funds for the area. A-94 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Loan Terms and Security Loans have 55-year terms, and bear simple interest at the rate of three percent (3%) per year. For the ﬁrst 30 years, annual interest payments are required in the amount of 0.42 percent (0.42%) of the outstanding principal loan balance. The annual payment amount for the next 25 years will be set by HCD in year 30, and will be the minimum amount necessary to cover HCD’s monitoring costs. Unpaid principal and accrued/deferred interest will be due at the end of the loan term. Rent and Occupancy Limits MHP assisted unit rent and tenant incomes will be restricted in accordance with the rent and income limits proposed by the project sponsor in their MHP application, with rents not exceeding 30 percent of the applicable income limit. The maximum possible income and rent limits are those set by the Tax Credit Allocation Committee (TCAC), using its calculation methods: Sixty percent (60%) of Area Medium Income (AMI), adjusted by household size, and 30 percent of 60 percent of AMI, adjusted by bedroom size. (These maximum limits are available on the TCAC website at www.treasurer.ca.gov/ctcac/.) Projects will be underwritten at the rent limits for the income levels proposed in the application. The Program’s 1.20 debt coverage ratio limit will be applied using the maximum rents allowable. Assisted unit rent increases will be limited in accordance with the rules governing tax credit units and Section 7311 and 7312. Where the project receives Section 8 or other rental assistance subsidies, “rent” is deﬁned as the tenant’s contribution, rather than the contract rent level. Sponsors of this type of project will be required to continue the rental assistance as long as it is available. Projects with rental subsidies must also be feasible with 50 percent of AMI rents for units garnering income-targeting points in the event the rental assistance is terminated. Projects for Populations with Special Needs Sponsors of Special Needs Populations projects must submit a speciﬁc, feasible plan for delivery and funding of tenant services for Department approval and will be required to meet minimum threshold criteria for experience and the provision of services. MHP funds may not be used to fund tenant services. Sponsors must also be very careful to avoid violation of laws barring housing discrimination. HCD will review proposed tenant selection criteria A-95 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY for potential violations of these laws. HCD may condition funding on the elimination of restrictions that it believes to be impermissible, or reject an application where it determines that compliance with applicable law is not feasible. Fair Housing is a very complex and in many ways unsettled area of law. Sponsors are encouraged to seek professional advice if there is any doubt that their proposal may run afoul of non-discrimination and fair housing laws. A useful resource is Between the Lines, A Question and Answer Guide on Legal Issues in Supportive Housing published by the Corporation for Supportive Housing. This document is available online at www.csh.org or by calling the publisher at (510) 251-1910. Geographic Distribution MHP’s enabling statute requires the program to “ensure a reasonable geographic distribution of funds.” To prevent an extreme imbalance in funding, no less than approximately 45 percent of the total funds are currently awarded to projects in Southern California (including Riverside County), 30 percent will be awarded to projects in Northern California, and 10 percent will be awarded to projects in rural areas. Transitional Housing MHP funds may be used to ﬁnance the development of transitional housing for homeless populations. The Supportive Housing Program component of MHP may only be used to ﬁnance the development of permanent housing. Loan Amounts The table that follows shows the most recent allocation per unit and affordability level for projects developed in the County of Riverside. Riverside County MHP Loan Limits Income Level Efﬁciency 1 BR 2 BR 3 BR 4+ BR 60% Income Level $45,000 $45,000 $45,000 $45,000 $45,000 55% Income Level $52,202 $52,779 $54,363 $55,804 $56,956 50% Income Level $59,549 $60,557 $63,726 $66,607 $69,056 45% Income Level $66,751 $68,336 $73,089 $77,411 $81,012 40% Income Level (MHP A) $73,954 $76,114 $82,308 $88,070 $92,968 35% Income Level (MHP B) $81,300 $83,893 $91,671 $98,874 $105,068 30% Income Level (MHP C) $88,502 $91,671 $101,034 $109,677 $117,024 A-96 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The Stewart B. McKinney Homeless Assistance Amendments Act of 1990 authorized a Federal grant program to deal with the needs of people who are homeless and have serious mental illnesses. The program -- known as Projects for Assistance in Transition from Homelessness (PATH) -- funds community-based outreach, mental health, substance abuse, case management and other support services, as well as a limited set of housing services. In FY 2005, the PATH program distributed over $52 million through formula grants to each State, the District of Columbia, Puerto Rico, and the U.S. Territories to provide services to people with serious mental illnesses -- including those with co-occurring substance use disorders -- who are homeless or at risk of becoming homeless. The formula is based on the urban population in the jurisdiction compared to the total U.S. urban population, with minimum grants of $300,000 per year to each State. Latest available data indicate that in FY 2005, States engaged 463 local organizations in the provision of services. These organizations reported more than 82,000 enrollments for PATH- supported services. The PATH program is administered by the Center for Mental Health Services, a component of the Substance Abuse and Mental Health Services Administration, one of eight Public Health Service agencies within the U.S. Department of Health and Human Services. PATH Providers Serve People with Mental Illnesses Who Are Homeless: Local PATH-supported agencies reported they delivered services to more than 82,000 people in FY 2005. Who were their clients? Demographic data reveal the following for the clients for whom information was obtained. • More than half the clients served (61 percent) were male. • More than half the clients (54 percent) were Caucasian. Over a third (33 percent) were African American; 9 percent were of Hispanic origin; the rest represented Asian, Native American and other racial groups. • Nearly 97 percent of the people served were between the ages of 18 and 64. A-97 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • PATH clients have some of the most disabling mental disorders. Among clients for whom a diagnosis was reported, 27 percent had schizophrenia and other psychotic disorders and 44 percent had affective disorders such as depression. • Over 57 percent of the clients had a substance use disorder in addition to a serious mental illness. PATH Projects Involve a Broad Range of Service Providers: The PATH program involves a wide network of State and local agencies that contribute comprehensive community-based services for people who are homeless and have serious mental illnesses. PATH providers have succeeded in putting experience and expertise to work to meet the needs of homeless people who have mental illnesses by engaging the services of community mental health centers and other mental health providers, community-based social service agencies, health care providers, and substance abuse service providers. Local PATH-supported organizations provide a wide range of services to people who are homeless. Among the services eligible for funding under PATH are: • Outreach services, • Screening and diagnostic services, • Habilitation and rehabilitation services, • Community mental health services, • Alcohol or drug treatment services (for people with mental illnesses and co-occurring substance use disorders), • Case management services, • Supervisory services in residential settings and • A limited set of housing services and services to help clients access housing resources. In addition, virtually all States use PATH funds to provide outreach services to contact and engage people who have not sought services. FY 2005 data reveal the following: • Over 90 percent of all providers offer outreach to persons who are homeless. • Eighty-three percent (3%) of providers offer case management services. A-98 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • More than 78 percent of providers use PATH funds to assist clients in accessing primary health care services, job training, education services, and housing. States also use PATH funds to train local provider staff on effective strategies to assist persons who are homeless and have mental illnesses. In many States, PATH funds are the only dollars available for outreach services within the mental health system. PATH Program Funds Stimulate State and Local Contributions: PATH funds represent over 23 percent of the total dollar amount earmarked by provider agencies for serving homeless people with mental illnesses. These funds are worth more than their face value because they must be matched by State and local resources. For every $3 in Federal funds, State or local agencies must put forward $1 in cash or in-kind services. At a minimum, a $26 million Federal allocation would result in a $8.6 million match. However, in FY 2005, States matched over $32.7 million in State and local funds against the $52.4 million Federal allocation. In some States, PATH funds and the State and local match are the only commitment of resources targeted to homeless people with serious mental illnesses. For more information about the PATH program, please contact: Michael Hutner, Ph.D., Director, and Dorrine Gross, Co-Director, PATH Program Homeless Programs Branch Division of Service Systems Improvement Center for Mental Health Services Substance Abuse and Mental Health Services Administration U.S. Department of Health and Human Services A-99 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Public housing was established to provide decent and safe rental housing for eligible low- income families, the elderly, and persons with disabilities. Public housing comes in all sizes and types, from scattered single family houses to high-rise apartments for elderly families. There are approximately 1.3 million households living in public housing units, managed by some 3,300 Housing Authorities (HAs). The U.S. Department of Housing and Urban Development (HUD) administers Federal aid to local housing agencies (HAs) that manage the housing for low-income residents at rents they can afford. HUD furnishes technical and professional assistance in planning, developing and managing these developments. Eligibility Public housing is limited to low-income families and individuals. A Housing Authority determines eligibility based on: 1) annual gross income; 2) age, disability, and family composition; and 3) U.S. citizenship or eligible immigration status. The HA checks references to verify an applicant’s previous rental history and experiences. Applicants whose habits and practices may be expected to have a detrimental effect on other tenants or on the project’s environment are denied access. HAs use income limits developed by HUD to determine eligibility. HUD sets the lower income limits at 80 percent and very low income limits at 50 percent of the median income for each county or metropolitan area. Income limits vary by area and are adjusted for family size. Application and Documentation In Riverside the Economic Development Administration receives, reviews, and approves applications for public housing. The documentation process requirements are as follows: (1) Names of all persons who would be living in the unit, their sex, date of birth and relationship to the family head; (2) Current address and telephone number; (3) Family characteristics (e.g., veteran) or circumstances (e.g., living in substandard housing) that might qualify the family for tenant selection preferences; 4) Names and addresses of current and previous landlords for information about each household’s suitability as a tenant; A-100 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY (5) An estimate of each household’s anticipated income for the next twelve months and the sources of that income; (6) The names and addresses of employers, banks, and any other information the HA would need to verify income and deductions, and to verify the household (family) composition; and an authorization to release the information by contacting each to provide a written certiﬁcation and/or documentation; and (7) The PHA also may conduct home visits to assess how a household currently maintains its unit. Tenancy All units managed by Housing Authorities must be under (minimum 6 month) lease. Waiting Lists and Selection Preferences Because demand for public housing exceeds supply, each Public Housing Authority maintains a waiting list of eligible applicants awaiting access to public housing. The waiting list is managed by the HA which has the authority (with HUD approval) to designate speciﬁc populations for priority. Currently the waiting list managed by the Riverside EDA includes 15,000 applicants for assisted housing. The management of the waiting list reﬂects public policy priorities; it is the mechanism by which a Housing Authority may target its scarce housing resources to households with the greatest housing needs. Each HA has the discretion to establish preferences to reﬂect needs in its own community. These preferences are included in the HA’s written policy manual. Among the most common preferences are: Rent HUD refers to the tenant’s portion of rent as the Total Tenant Payment (TTP). TTP is established for each household based on anticipated gross annual income, less deductions, if any. HUD regulations allow Housing Authorities to exclude from annual income the following allowances: $480 for each dependent; $400 for any elderly family, or a person with a disability; and some medical deductions for families headed by an elderly person, or a person with disabilities. Annual income is the anticipated total income from all sources received from the family head and spouse, and each additional member of the family 18 years of age or older. A-101 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The formula used in determining the TTP is the highest of the following, rounded to the nearest dollar: (1) 30 percent of the monthly adjusted income. (Monthly Adjusted Income is annual income less deductions allowed by the regulations); (2) 10 percent of monthly income; (3) Applicable welfare rent (established by the County), if applicable; or (4) A $25 minimum rent or higher amount (up to $50) set by a Housing Authority. Role of the Housing Authority The Riverside County Economic Development Administration is responsible for the management and operation of the local public housing program. It also operates other types of housing programs. As regard public housing, the HA’s routine management responsibilities include: (a) compliance with leases (b) establishing and collecting other charges (e.g., security deposit, excess utility consumption, and damages to unit); (c) performing annual re-veriﬁcations of each household’s income and other eligibility criteria; (d) transferring households from one unit to another, in order to correct over/under crowding, repair or renovate a dwelling, or to satisfy a personal preference of the tenant; (e) terminating leases as necessary; and (f) maintaining the development in a decent, safe, and sanitary condition. Many Housing Authorities, including the EDA, provide other supportive services that may include such things as: homeownership opportunities for qualiﬁed families; employment training opportunities, and other special training and employment programs for residents; and support programs for elderly and/or disabled residents. In general, a household may remain in public housing as long as it is in compliance with the terms of the lease. If, at re-certiﬁcation a household’s income is sufﬁcient to obtain housing on the private market, the HA may terminate assistance so long as there are suitable affordable units available in the private market. A-102 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Purpose For over 50 years, redevelopment agencies in California have effectively provided the economic stimulus to rebuild declining communities. In today’s business and economic climate, California cannot afford to let its communities decline. Yet, persons in local government feel that the rebuilding of our communities is at risk due to actions taken by State government. Redevelopment has proven to be one of the most effective ways to expand businesses, develop affordable housing, create jobs, and provide public infrastructure. Redevelopment is a “smart growth” approach that encourages inﬁll development in urban areas, slows development of vacant farmland, cleans up contaminated sites, and revitalizes old neighborhoods. There are 417 community redevelopment agencies and 772 project areas in the state. Throughout the County of Riverside, there are 24 redevelopment agencies administering 55 project areas. Statewide, 80 percent of all cities have redevelopment agencies and 45 percent of all counties and in Riverside, all Cities with the exception of Canyon Lake have redevelopment agencies. In Riverside County, annual local property tax increment revenues of approximately $360 million fund local redevelopment projects from jobs to housing to public infrastructure. Just over $72 million has been allocated to meet the housing set-aside requirements contained in redevelopment law as a result of a 1976 statute. The State of California has not always recognized redevelopment’s contributions to California’s economy. On ﬁve occasions, the State has taken away funds from redevelopment investment. In 1992 and 1993, the State Legislature was confronted with a budget greatly out of balance. As part of the solution, the Legislature established the Education Revenue Augmentation Fund (ERAF) and required a portion of property tax increment to be allocated to schools through this device. (An ERAF “shift” reduces dollar-for-dollar the amount of State general fund aid to schools, making up for it with redevelopment funds.) In 1992, the shift from redevelopment agencies to ERAF amounted to $205 million. In 1993-94 and 1994-95, redevelopment agencies were required to transfer $65 million each year to ERAF. Funds were A-103 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY transferred to ERAF again in 2002-03 and 2003-04 with redevelopment agencies: $75 million and $135 million, respectively. Assistance Type An agency may allocate grants or loans linked to speciﬁc developments. It may also offer annual operating assistance (subsidies). Terms Negotiable, but generally loans for affordable housing are residual receipt at a reduced interest rate for 55 years. California Community Redevelopment Law (CRL) requires that no less than 20 percent of tax increment revenue derived from a redevelopment project area be used to increase, improve, and preserve the supply of housing for very low-, low- and moderate-income households. If none is provided within a redevelopment project area, then the funds must be used to build twice that amount elsewhere. Possibilities include ﬁnancial assistance to upgrade existing units, the construction of new housing, and improvements to public facilities and infrastructure that service low- and moderate-income neighborhoods. The following uses are authorized housing set-aside expenditures: • Acquisition of real property or building sites; • Onsite or offsite improvements, if such improvements are part of a program which results in the new construction or rehabilitation of affordable housing, or if the redevelopment agency ﬁnds that such improvements are necessary to eliminate a speciﬁc condition which jeopardizes the health or safety of low- and moderate-income households; • Donation of real property to private or public persons or entities; • Financing insurance premiums during the construction or rehabilitation of properties by government entities or nonproﬁt organizations to provide lower-income housing; • New construction or rehabilitation of buildings or structures; • Acquisition of buildings or structures; • Provision of subsidies to, or for the beneﬁt of, lower-income households to the extent that these households cannot obtain housing at affordable costs in the private marketplace; A-104 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • Development of plans, payment of principal, interest, ﬁnancing or carrying costs on bonds, loans, advances or other indebtedness to ﬁnance low- and moderate-income housing; • Preservation of the affordability of low- and moderate-income housing units which are assisted or subsidized by public entities and which are threatened with imminent conversion to market rates; • Satisfaction of replacement housing requirements of CRL; and • Reasonable administrative expenses (including operating support for nonproﬁt developers of redevelopment agency-assisted housing). Whenever residential units housing persons of low or moderate income are removed from the market as part of a speciﬁc project, an agency is required by law to rehabilitate or construct an equal number of replacement dwelling units within the jurisdiction of that agency, within four years of removal. Also, 75 percent of the replacement units must be affordable to the same income level (very low, low or moderate) as the persons displaced from the removed units. Inclusionary Housing Requirements In addition to the 20 percent requirement, the California Community Redevelopment Law (CRL) contains inclusionary housing requirements. If the agency develops the units, at least 30 percent of all new or rehabilitated dwelling units must be available at affordable housing cost to persons of low and moderate income. Also, not less than 50 percent of those units are to be available at affordable cost to persons of very low income. Within a project area, new or rehabilitated dwelling units developed by public or private entities (or persons other than an agency within a 10-year period) are to be available at costs affordable to persons of low or moderate income with not less than 40 percent of these units made available to very low-income households. Redevelopment law permits an agency to meet the inclusionary requirements by constructing housing units outside a project area on a two for one basis, i.e., for every unit of inclusionary housing required, two units outside the project area must be developed. Application Procedure Developers seeking ﬁnancial assistance contact redevelopment agencies in the jurisdiction in which the subject project is located. A-105 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Administrative Agencies Federal: Department of Health and Human Services (HHS), Health Resources and Services Administration (HRSA), HIV/AIDS Bureau, (301) 443-6745 www.hab.hrsa.gov and www.hab.hrsa.gov/programs.htm CA: California Health and Human Services Agency, Department of Health Services, Ofﬁce of AIDS, (916) 449-5900, www.dhs.ca.gov/ps/ooa/ooaindex.htm Riverside/San Bernardino Counties: Mr. Danny Perez, MSW, Public Health Program Coordinator, San Bernardino County, Department of Public Health, 1280 East Cooley Drive, Suite C, Colton, CA 92324; (909) 876-3952; Fax: (909) 872-1505 Type Of Assistance: Formula and Competitive Program Description The Ryan White CARE Act provides funding to localities, states and other public or private nonproﬁt entities to develop, organize, coordinate and operate more effective and cost-efﬁcient systems for the delivery of essential health care and support services to medically underserved individuals and families affected by HIV disease. The Ryan White CARE Act established a A-106 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY variety of AIDS programs to address the unmet health needs of persons living with HIV disease in order to improve the availability and quality of community-based outpatient primary health care and support services that enhance access to and retention in care. CARE Act-funded services are intended to reduce the use of more costly inpatient care, increase access to care for underserved populations, and improve the qualify of life for those affected by the epidemic. CARE Act programs fund local and State programs that provide medical care and support services; healthcare provider training; and, technical assistance to help funded programs address implementation and emerging HIV care issues. The CARE Act established programs under ﬁve titles or parts, of which Titles I and II are most relevant for supportive housing providers. While Titles I and II do not directly fund the development or operation of permanent or long-term supportive housing for people with AIDS, they will fund housing-related services (including emergency ﬁnancial assistance, emergency housing, housing referrals, and some transitional housing assistance) and supportive services to residents in supportive housing. Title I: Grants to Eligible Metropolitan Areas (EMAs) or HIV Emergency Relief Project Grants Title I establishes formula and competitive supplemental grants to fund community-based health care, and early intervention and support services in localities that are most severely affected by the HIV/AIDS epidemic, called Eligible Metropolitan Areas (EMAs). Title I funding to EMAs includes formula and supplemental components, and Minority AIDS Initiative funds targeted for services to minority populations. Supplemental grants are awarded competitively based on demonstration of severe need and other criteria. To be eligible, an area must have reported at least 2,000 AIDS cases during the previous ﬁve years and have a population of at least 500,000. When the ﬁrst Title I grants were awarded in ﬁscal year 1991, there were 16 EMAs. Today, 51 EMAs receive funding in 21 States, Puerto Rico, and the District of Columbia. Funding In ﬁscal year 2006, $611.6 million was appropriated for Title I spending of which $7,074,521 was awarded to Riverside and San Bernardino Counties. Title I funding to EMAs includes formula and supplemental components, as well as Minority AIDS Initiative funds targeted A-107 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY for services to minority populations. The funds allocated to Riverside and San Bernardino Counties are administered by the San Bernardino County Department of Public Health. • Formula grants are based on the estimated number of living cases of AIDS over the most recent 10-year period. Beginning in FY 2007, if accurate and reliable data are available, formula funds will be based on living HIV/AIDS cases (HIV-positive and AIDS cases).* • Supplemental grants are awarded competitively based on demonstration of severe need and other criteria. Title II: Grants to States or Territories or HIV Care Formula Grants Title II establishes a formula grant program to all States and Territories to improve the quality, availability, and organization of their health care and support services for individuals and families with HIV/AIDS. Title II funds a wide range of services including (and in addition to direct health and support services) continuation of health insurance coverage and pharmaceutical treatments. Title II funding to States or Territories includes: a base formula component; the AIDS Drug Assistance Program (ADAP); and grants to States for Emerging Communities -- those reporting between 500 and 1,999 AIDS cases over the most recent ﬁve years. The base formula grant component of Title II is most relevant for supportive housing sponsors. Decisions about the use of Title II funds are made at the sate and/or local consortia level. Some communities receive funding from both formula grant programs, some from one or the other. Relative to supportive housing sponsors accessing these CARE Act funds, Title I and II formula grants are generally not distinguished at the local level and are administered together as CARE Act funds. Except where there are signiﬁcant differences, the balance of this summary will describe the formula grant components of Title I and II CARE Act programs together. Eligible Target Populations: Low-income individuals with HIV/AIDS and their families (including caregivers). The most likely users of CARE Act services include people with no other source of health care and those with MediCal or private insurance whose care needs are not being met. A-108 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Eligible Projects/Programs: Programs that provide an effective, appropriate and cost efﬁcient continuum of health care and support services for individuals and families with HIV disease. Eligible Use of Funds & Use Restrictions: Title I funds may be used for the provision of health and support services, including: • outpatient and ambulatory health services including substance abuse and mental health treatment • early intervention services, including outreach, counseling and testing, and referral services designed to identify HIV-positive individuals who know their HIV status • support services (including case management, home health and hospice care, emergency and short-term housing assistance, transportation assistance, nutrition services, and day/ respite care) to the extent that these support services facilitate, enhance, support, or sustain delivery, continuity or beneﬁts of health services • inpatient case management services that expedite discharge and prevent unnecessary hospitalization. Title I funds may not be used for: construction, rehabilitation, or long-term rental assistance, and only a small portion of Title I funds may directly provide housing services. Title II funds may be used for all of the uses of Title I plus: • establishment and operation of HIV consortia • continuity of insurance coverage; and • pharmaceutical treatments through the AIDS Drug Assistance Program (ADAP). Ryan White funds can support the wide variety of health care needs and other supportive services described above delivered in a variety of settings, including housing. As such, they are commonly used to fund the supportive services in transitional housing and permanent supportive housing targeted for people with HIV disease. For example, primary medical care and support services for residents of permanent housing are eligible under the primary medical care and supportive services categories, not out of housing assistance. Likewise, substance abuse services can be provided to residents in a supportive housing program as long as they are funded under the substance abuse category, not one of the housing-related categories. A-109 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY There are two categories of housing related expenditures to which Ryan White funds may be allocated: Housing Referral Services and Short-term or Emergency Housing. • Housing Referral Services include assessment, housing search and placement, and advocacy to assist persons living with HIV/AIDS to obtain and maintain stable housing. To be eligible for Ryan White funding these services must be provided by case managers or other professionals who possess a comprehensive knowledge of local, state, and Federal housing programs and how they can be accessed. • Emergency assistance refers to programs that are of very short duration and are intended to assist individuals or households in situations of immediate housing crisis. Examples of emergency assistance include hotel or motel vouchers, emergency shelter stays, homeless prevention assistance (such as one-time rent or utility payments), assistance moving to a new location, or payments to cover bed nights in an emergency alcohol or substance abuse detoxiﬁcation program. Housing funds used for detoxiﬁcation services are only allowed if the treatment provider requires payment for the housing and does not receive Ryan White funds from the substance abuse category to cover this expense. • Short-term assistance refers to programs or payments that are designed to stabilize an individual’s housing situation, and to support his or her transition to long-term sustainable housing. Short-term housing assistance includes transitional housing programs, short-term rental assistance, temporary living assistance, and short-term residential treatment. As with funds to pay for detoxiﬁcation services, Ryan White funds can pay for residential treatment if the treatment provider requires payment for the housing portion of the program and does not receive Ryan White funds from the substance abuse category to cover this expense. Eligible Applicants/Sponsors: Title I: Formula grants are awarded to Eligible Metropolitan Areas (EMAs) deﬁned as areas that have reported at least 2,000 AIDS cases during the previous ﬁve years and have a population of at least 500,000. EMAs range in size from one city/county to more than 26 different political entities, and some span more than one state. Supplemental grants are awarded competitively to EMAs that demonstrate: severe need; a plan to use the funds responsively and in accordance with local demographics; an ability to use the funds cost- effectively; the commitment of local resources to combat HIV/AIDS, and members on the HIV planning council that is inclusive and representative of the population living with HIV A-110 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY disease. Title I funding is evenly split between formula and supplemental grants. Public and private nonproﬁt entities are eligible to receive sub-grants from Title I EMAs. The CARE Act requires each EMA to establish an HIV Health Services Planning Council which develops a comprehensive plan for the organization and delivery of health care and supportive services to people living with HIV/AIDS in its area, along with strategies for identifying HIV-positive persons not in care and strategies for coordinating services to be funded with existing prevention and substance abuse treatment services. In addition, the plan must comply with any local plan regarding the provision of such services to people living with HIV/AIDS, e.g., Consolidated Plan, HOPWA funding. The Planning Council identiﬁes and prioritizes funding needs and advises on an effective mechanism to allocate funds. Planning Council membership must “reﬂect the local epidemic” and include members with speciﬁc expertise, e.g., health care planning, housing for the homeless, incarcerated populations, substance abuse and mental health treatment, or represent other CARE Act and Federal programs. At least 33 percent of Council members must be people living with HIV who are consumers of CARE Act Title I services. Ryan White Title I funds are commonly used for supportive services for HOPWA-funded housing projects. Title II: Formula grants are awarded to all 50 States, the District of Columbia, Puerto Rico, Guam, the U.S. Virgin Islands and ﬁve newly eligible U.S. Paciﬁc Territories and Associated Jurisdictions. Most States provide some services directly, while others work through subcontracts with public or nonproﬁt entities, and Title II HIV Care Consortia, for the provision of services. A consortium is an association of public and nonproﬁt health care and support service providers and community-based organizations that plans, develops, and delivers services for people living with HIV disease.) In some limited cases, for-proﬁt entities are eligible for sub-contracts. Except where ADAP funds are concerned, decisions about the use of Ryan White Title II funds are made at the local level by the state and/or local consortia. Many communities receiving both Title I and II funds have one body that serves as both the HIV Health Services Planning Council and HIV Care Consortia. Eligible sub-grantees of Ryan White CARE funds include public or nonproﬁt entities. For-proﬁt entities are eligible only if they are the sole available providers of quality HIV care in the area. A-111 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Minimum/Maximum Awards: Title II: Minimum of 100,000 if state has fewer than 90 estimated living AIDS cases or $250,000 if state has at least 90 living AIDS cases. (No minimum grant amount for Territories.) Average Awards: N/A Term of Awards: Annual awards Matching Requirements: Title I: N/A Title II: States with more than one percent (1%) of total AIDS cases reported in the U.S. during the previous two years must contribute a match with their own resources, according to a formula. Formula: Title I formula grants are based on the estimated number of living cases of AIDS over the most recent 10-year period. Beginning in FY 2004, if accurate and reliable data exist, formula funds will be based on HIV prevalence -- AIDS cases and HIV infections that have not yet progressed to AIDS. Title I formula grants have no matching requirements. Title II formula grants are based on a formula that historically has been based on reported AIDS cases. Beginning in ﬁscal year 2004, if accurate and reliable data exist, formula funds will be based on HIV prevalence -- AIDS cases and HIV infections that have not yet progressed to AIDS. Application Process EMAs and States and Territories are the eligible applicants for formula components of CARE Act programs. All previous EMAs are can apply for Title I Supplemental project grants. To determine if you are located in an EMA, see the HRSA/HAB website (www.hab.hrsa.gov Programs, Title I). A-112 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Supportive housing sponsors wishing to access CARE Act funds to deliver services in supportive housing should contact the local and/or state HIV Planning Council or CARE consortium in charge of Ryan White CARE Act planning and fund allocation processes. HIV planning councils or consortia typically do needs assessments no less than every three years; develop plans that address particular service needs (e.g., primary health, substance abuse and mental health treatment, housing, etc.); prioritize the service needs; outline which service needs will be addressed by Ryan White funding and which will be addressed by other funding. Sometimes the Planning Council or consortium issue RFPs or use other competitive funding mechanisms to allocate the resources for the prioritized service needs to be addressed by Ryan White funding. (Tip: Permanent supportive housing sponsors seeking Ryan White Care Act funding for supportive services should apply under supportive and early intervention services categories, not under housing assistance categories. Transitional supportive housing sponsors may apply under housing assistance categories for programmatic and operating costs of their programs) CFDA Code: 93.914 & 93.917 Authorizing Legislation/statute Public Health Service Act, Title XXVI, Parts A and B, as amended, Public Law 106-345, Ryan White Care Act Amendments of 2000. Regulations/guidelines PHS Grants Policy Statement, DHHS (OASH) Publication No. 94-50,000 (Rev.) April 1, 1994. Program guidelines and instructions are included in the application kit. HHS has developed a series of public policies that provide further guidance on allowable use of funds, including HAB Policy 99-02 detailing eligible housing-related costs. Additional Resources • “Housing is Health Care: A Guide to Implementing the HIV/AIDS Bureau (HAB) Ryan White CARE Act Housing Policy”, funded by U.S. Department of Health and Human Services Health Resources and Services Administration, HIV/AIDS Bureau, with John Snow, Inc. and AIDS Housing of Washington. www.hab.hrsa.gov/tools/guidance/ housing.htm A-113 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • AIDS Housing of Washington (AHW), www.aidshousing.org, In particular, “Financing AIDS Housing”, “Ryan White CARE Act and Housing Assistance Fact Sheet”, “HIV/AIDS Housing Solutions” on the Resources/Resource Library page of the website. A-114 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Tenant-based vouchers increase affordable housing choices for very low-income families. Families with a tenant-based voucher choose and lease safe, decent, and affordable privately- owned rental housing by providing a subsidy making up the difference between a household’s ability to pay and a maximum rent. The maximum rent that the voucher may pay is established by HUD which publishes annual Fair Market Rent schedules in the Federal Register. Administration The administration of the rental assistance is by the Public Housing Authority (PHA) which is a branch of the EDA in Riverside County. PHAs receive vouchers by applying to HUD in response to notices of funding availability (NOFAs) published in the Federal Register. Each NOFA identiﬁes allocation areas, amount of funds available per area, and the selection criteria for rating and ranking applications. Eligibility for Tenant-based Voucher Assistance Eligibility for voucher assistance is limited to very low-income households (i.e., individuals and families with incomes below 50 percent of area median income) and a few speciﬁc categories of families with incomes up to 80 percent of the area median income. The higher- income families include those that are already assisted under the 1937 U.S. Housing Act, such as families physically displaced by public housing demolition and owners opting out of project-based Section 8 housing assistance payments (HAP) contracts. Eligibility criteria and veriﬁcation of income procedures Identifying Appropriate Housing Units It is the responsibility of each household awarded a voucher to identify a unit that best meets its needs. Units must meet minimum housing quality standards and the rent to be charged must be reasonable based on market comparables. If the household and the unit are deemed eligible, the PHA executes a HAP contract with the property owner which authorizes the PHA to make subsidy payments on behalf of the tenant. Households are permitted to move to another unit under this program (within limits established by the PHA). A-115 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Assistance Levels The PHA pays the owner the difference between 30 percent of adjusted family income and a PHA determined payment standard or the gross rent for the unit, whichever is lower. The family may choose a unit with a higher rent than the payment standard and pay the difference to the owner. A-116 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The SRO Program provides rental assistance for homeless persons in connection with the moderate rehabilitation of SRO dwellings. SRO housing contains units for occupancy by one person. These units may contain food preparation or sanitary facilities, or both. The Single Room Occupancy (SRO) program is authorized by Section 441 of the McKinney- Vento Homeless Assistance Act and the regulations can be found at 24 CFR Part 882. Under the program, HUD enters into Annual Contributions Contracts with public housing agencies (PHAs) in connection with the moderate rehabilitation of residential properties that, when rehabilitation is completed, will contain multiple single room dwelling units. These PHAs make Section 8 rental assistance payments to participating owners (i.e., landlords) on behalf of homeless individuals who rent the rehabilitated dwellings. The rental assistance payments cover the difference between a portion of the tenant’s income (normally 30 percent) and the unit’s rent, which must be within the fair market rent (FMR) established by HUD. Rental assistance for SRO units is provided for a period of 10 years. Owners are compensated for the cost of some of the rehabilitation (as well as the other costs of owning and maintaining the property) through the rental assistance payments. To be eligible for assistance, a unit must receive a minimum of $3,000 of rehabilitation, including its prorated share of work to be accomplished on common areas or systems, to meet housing quality standards (HQS). Assistance provided under the SRO program is designed to bring more standard SRO units into the local housing supply and to use those units to assist INDIVIDUALS leave homelessness for permanent affordable housing. While access to supportive social services is encouraged, there is no requirement (as with the Shelter Plus Care Program) that the residents participate in rehabilitative activities. The SRO program is therefore appropriate for persons who are either resistant to services, but interested in accessing permanent housing, or for those whose primary barrier to housing is low-income. The SRO units might be in a rundown hotel, a “Y”, an old school, or even in a large abandoned home. One strategy has been to undertake an adaptive reuse of an underutilized property. A-117 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The availability of a ten-year housing assistance payments (HAP) contract makes this an important resource for rehabilitation. Long-term HAPs allow for the amortization of debt and provide conﬁdence to investors in Low-Income Housing Tax Credit (LIHTC) properties that the property will provide a positive cash ﬂow over its initial 15-year compliance period. The application for rental assistance is included in the Continuum of Care application submitted to HUD. Eligible applicants are Public Housing Authorities and non-proﬁt organizations. A-118 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The Shelter Plus Care Program provides rental assistance for hard-to-serve homeless persons with disabilities in connection with supportive services funded from sources outside the program. • Shelter Plus Care (S+C) is a program designed to provide housing and supportive services on a long-term basis for homeless persons with disabilities, (primarily those with serious mental illness, chronic problems with alcohol and/or drugs, and acquired immunodeﬁciency syndrome (AIDS) or related diseases) and their families who are living in places not intended for human habitation (e.g., streets) or in emergency shelters. The program allows for a variety of housing choices, and a range of supportive services funded by other sources, in response to the needs of the hard-to-reach homeless population with disabilities. Program grants are used for the provision of rental assistance payments through four components: • Tenant-based Rental Assistance (TRA); • Sponsor-based Rental Assistance (SRA); • Project-based Rental Assistance with (PRAW) or without rehabilitation (PRA); • Section 8 Moderate Rehabilitation Program for Single Room Occupancy (SRO) Dwellings. The supportive services are a required match and may be funded by other Federal, State, or local sources, as well as private sources. Nearly all supportive social services count toward the match requirement. Match is accounted for on an aggregate basis meaning that the there does not need to be a one-to-one correlation between the rental assistance provided to a particular program participant and the level of services he receives. The amount of grant funds is determined by the number of units multiplied by the Fair Market Rent times the term of the grant. Tenant-based, Sponsor-based, and Project-based assistance without rehabilitation are awarded ﬁve-year terms; Project-based assistance and the Section 8 for SRO components are awarded 10-year terms. Project-based and Section 8 for SRO components require a minimum of $3,000 of rehabilitation per unit to prepare it for occupancy. All rehabilitation must be completed within 12 months of grant execution. The costs of rehabilitation must be obtained from sources other than the grant. A description of tenant-based voucher assistance can be found in this section. A-119 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Program Description The Special Needs Financing Program offers low interest rate ﬁnancing for the development of rental housing to serve a broad range of special needs tenants in need of supportive services. Loan types include bridge, permanent, or Loan to Lender and can be used for new construction or acquisition/rehabilitation. • Available to non-proﬁt and public agency sponsors. This program is intended for housing organizations that target special needs populations and supply supportive services. Special needs projects may include mixed income tenants (as appropriate) for the target population Loan Amount: Negotiable. Loan funds must be used for the real estate component of the project, and not for direct services. Fees (subject to change) Application Fee: $500, due at time of application submittal Origination Fee: One percent (1%) of the loan amount, due prior to the CalHFA Board Meeting Credit Enhancement Fee: Included in the interest rate Rate & Terms (subject to change) Fixed rate, fully amortizing; ﬁve to 30 year terms. Interest rate is typically three percent (3%) or less, depending on several factors, including the number of special needs tenants, the percent of very low income tenants served, and the ﬁnancial need of the project. There must be a clear link between the income level of the tenants, the cost of the special needs services provided, and the amount of subsidy that CalHFA must commit to bring the interest rate down to a level that supports the project ﬁnancially. A-120 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Subordinate Financing Subordinate loans or grants are encouraged from local government and third parties to achieve project feasibility. All loans, leases, development and regulatory agreements must be subordinate to CalHFA ﬁnancing. Occupancy Requirements Thirty-ﬁve percent of the units are required to be restricted to special needs households earning 50 percent or less of the county median income (as adjusted by family size). Projects that target either 60 percent or 100 percent special needs tenants may receive lower interest rates (two percent (2%) and one percent (1%) respectively) from CalHFA Due Diligence All of the listed due-diligence efforts are required and are at the borrower’s expense: • Property appraisal will be ordered by CalHFA; • a market study may be required • Phase I, seismic review and other studies may be required at CalHFA’s discretion • Physical Needs Assessment for rehabilitation projects • Construction period inspection fees are estimated at $1,500 per month • Design standards must meet CalHFA’s goal to provide safe and sanitary special needs housing • Service agreement with a qualiﬁed service provider with ﬁrst year’s service ﬁnancing secured Special Needs Populations To receive assistance under the Special Needs Financing Program, the proposed project needs to serve a disabled population or other population that requires special or supportive services to live independently. The Agency reserves the right to review and approve all “special needs” populations for applicability for this funding program. A-121 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Services & Asset Management The borrower must provide a clearly articulated service delivery program and property management plan. The services provided must be appropriate to the special needs population, and designed to assist the special needs residents to live independently. The borrower must have commitments for one-year of service funding at permanent loan closing. The Borrower will be required to provide the services for 10 years. In addition, the borrower and afﬁliate organizations will be scrutinized both for their ability to deliver high-quality services to the tenants and to successfully develop and manage the real estate component of the project. Questions Questions regarding the Special Needs Financing Program can be directed to CalHFA’s Multifamily Programs Division: Kathy Weremiuk, Loan Ofﬁcer, Multifamily Programs 100 Corporate Pointe, Suite 250, Culver City, CA 90230 Phone: 310.342.1250 Email address: firstname.lastname@example.org A-122 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The Supportive Housing Program is designed to develop supportive housing and services that will allow homeless persons to live as independently as possible. Eligible applicants are States, units of local government, other governmental entities such as PHAs, and private nonproﬁts. The Supportive Housing Program Desk Guide highlights key aspects of the Supportive Housing Program (SHP). The Supportive Housing Program is authorized by Title IV, Subtitle C, of the McKinney- Vento Homeless Assistance Act of 1987, as amended. It is designed to promote, as part of a local Continuum of Care strategy, the development of supportive housing and supportive services to assist homeless persons in the transition from homelessness and to enable them to live as independently as possible. Assistance in the Supportive Housing Program is provided to help homeless persons meet three overall goals: • Achieve residential stability, • Increase their skill levels and/or incomes, and • Obtain greater self-determination (i.e., more inﬂuence over decisions that affect their lives). Speciﬁc performance measures for each of these three goals must be established based on the needs and characteristics of the homeless population to be served. Grant recipients are required to monitor their clients’ progress in meeting their performance measures on an ongoing basis. In addition to record keeping and evaluation that grantees may conduct for their own purposes, HUD requires record keeping and annual progress reports. The annual progress report includes questions that ask grantees to report on their progress in meeting performance measures. Grantees are expected to make changes in their program or adjust performance measures in response to ongoing evaluation of their progress. Program Description The Supportive Housing Program (SHP) is one of three sources collectively known as Continuum of Care funding (the other two are the Shelter Plus Care and Section 8 Moderate A-123 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Rehabilitation SRO Programs). These programs are also often referred to as HUD McKinney funding or Targeted Homeless Assistance Programs. The SHP program provides grants to build, operate and provide supportive social services in supportive housing (both permanent and transitional) that enable homeless persons to live as independently as possible. The program operates under a statutory directive that 30 percent of all funds must go to permanent supportive housing thus the majority of new projects funded with this source in the recent past have been (and will likely continue to be) permanent supportive housing. Eligible Target Populations: Only homeless persons may receive assistance from SHP-funded projects. The deﬁnition of homelessness that applies to SHP funding may be found under the McKinney-Vento Act section. Eligible Projects/Programs: • Transitional housing providing stays (generally of up to 24 months). • Permanent housing for homeless persons and families with disabilities. • Safe Havens, deﬁned as projects with a 25 person maximum occupancy, serving hard-to- serve (i.e. chronic) homeless persons who have severe mental illness, are on the streets and have been unable and unwilling to participate in supportive services. Safe havens must provide 24-hour residence for an unspeciﬁed duration (i.e. no time limit on length of stay) and must provide private or semi-private accommodations. • Supportive Services Only programs designed to address the special needs of homeless persons, where the sponsor is only providing the services. • Innovative Supportive Housing programs or projects that are outside the scope of the four project types listed above. • Homeless Management Information Systems (HMIS). SHP funds may be used to pay the costs of implementing and operating a computerized HMIS. These funds may not be used for planning purposes. A-124 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Eligible Use of Funds and Use Restrictions: • New construction (up to a maximum of $400,000, regardless of where the project is located). • Acquisition and/or rehabilitation (up to a maximum of $400,000 for both activities combined, regardless of where the project is located). • Real property leasing (for either social service ofﬁces or residential units). • Operation of housing facilities (with a 25 percent cash match requirement). • Supportive services (with a 20 percent cash match requirement). • HMIS activities. • Administration (capped at ﬁve percent (5%)). Eligible Applicants/Sponsors: Eligible applicants apply through the local Continuum of Care (CoC) process. Applicants may be: • Non-proﬁt organizations • States • Local governments • Other government entities, including Public Housing Agencies (PHAs) Only a locally constituted Continuum of Care may apply to HUD for CoC funding, which includes requests for SHP, S+C and the Section 8 Moderate Rehabilitation for SRO program. The CoC funding process is described in the section titled Continuum of Care Programs, Planning and Systems Change. Minimum/Maximum Awards: N/A Average Awards: N/A A-125 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Term of Awards: Initial awards for operating and/or services, leasing and HMIS may be two- or three-year terms. The term of renewal grants is determined by the CoC based upon available funding. Most CoCs renew grants for one-year terms. Matching Requirements: • Development: 1:1 (i.e. $100 percent) • Operating: 25 percent of costs must be matched by another source • Services: 20 percent of costs must be matched by another source • Use of leveraged resources is among the criteria used to score the overall CoC plan. CoCs are strongly encouraged to seek out mainstream resources to support activities within their housing and service system. Formula: HUD allocates for each CoC a certain “pro rata need” funding amount. The pro rata need is calculated based on a formula that uses the same indices of need as are used in the CDBG program (including such factors as poverty and poor housing conditions). The pro rata need is adjusted to help communities meet the burden of renewing existing SHP grants. In the past years, HUD has also added incentives to create new permanent supportive by adding “bonus” funds to each jurisdiction’s pro rata need. Application Process Sponsors must apply for funding through their local Continuum of Care process. Each year HUD issues a NOFA announcing the availability of Continuum of Care funding. CoCs are required to conduct a community-based planning process to determine goals and strategies for addressing homelessness and priorities for funding for the coming year. The CoC also is required to conduct a broadly publicized application process whereby individual project sponsors submit proposal to the CoC body, which rates and ranks all applications received. The CoC then submits its CoC Plan along with a ranked set of funding applications to HUD. HUD awards funding to projects in the order they have been ranked by the CoC, up the community’s adjusted pro rata need amount. A-126 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY CFDA Code: 14.235 Authorizing Legislation/statute McKinney-Vento Homeless Assistance Act of 1987, Title IV, Subtitle C, as amended. Regulations/guidelines 24 CFR Part 583 www.hud.gov/ofﬁces/cpd/homeless/rulesandregs/regulations/583shp/index.cfm SHP Desk Guide: www.hud.gov/ofﬁces/cpd/homeless/library/shp/shpdeskguide/index.cfm A-127 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Legal Authority MHP was established by SB 121, Statutes of 1999 (Alarcón), which created Chapter 6.7, commencing with Section 50675, of the Health and Safety Code. Program Summary MHP is a streamlined, omnibus ﬁnancing program for affordable multifamily housing developments. It provides funds to cover development (capital) costs only, and cannot be used for services or operating subsidies. Applicants may apply for funding for (1) projects containing Supportive Housing units only; or (2) projects containing Supportive Housing and Non-Supportive Housing units (mixed projects). Supportive Housing and Non Supportive Housing units are deﬁned below. The Supportive Housing units are funded from the Supportive Housing funding component of MHP and the Non-Supportive Housing units are funded from the “General” MHP funding component. The MHP “General” funds may be made available in amounts sufﬁcient to fund the Non-Supportive Housing units that qualify for an MHP loan award. “Supportive Housing Units” means units offered as permanent housing linked to supportive services where occupancy is restricted to households that both (1) are homeless or at risk of homelessness and (2) include a disabled adult. “Non-Supportive Housing Units” means other housing units, including Special Needs Population units (also deﬁned below), in a qualiﬁed Supportive Housing project. “Special Needs Population” Units are units restricted to certain groups, as described in Section 7301(r), that may not meet all of the qualiﬁcations required to occupy Supportive Housing Units, but who still need services linked to their housing, such as disabled households who are not homeless. To be eligible for a mixed population award, at least 35 percent of the units (and not less than ﬁve units) in the proposed development must be Supportive Housing Units. Special Needs A-128 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Population projects that do not meet the 35 percent test may apply under the separate MHP General NOFA. Eligible Project Sponsors Sponsors and borrowing entities may be organized on a for-proﬁt or not-for-proﬁt basis. Any individual, public agency or private entity capable of entering into a contract is eligible to apply, provided that they or their principals have successfully developed at least one affordable housing project. The Department will evaluate all Sponsors, including the roles of any general partner(s) in a limited partnership, to determine if the Sponsor’s roles, responsibilities, and beneﬁts in the project development and operations are commensurate with activities normally undertaken or controlled by project developers and owners. The Sponsor will be reviewed to determine if adequate stafﬁng levels exist to undertake and complete the project. The same criteria will be applied to evaluate Sponsor experience for purpose of awarding points. Sponsors of projects where at least 70 percent of the units consist of Supportive Housing units or Special Needs Population units are exempt from the requirement for previous development experience under limited conditions. Sponsors must have site control in the name of the Sponsor or an entity controlled by the Sponsor as deﬁned in Uniform Multifamily Regulations (UMR) Section 8303. Eligible Uses of Funds MHP funds will be provided as permanent ﬁnancing only, and may be used to take out construction loans used to cover normal project development (capital) costs, as detailed in Section 7304. MHP funds may be used to capitalize a project operating reserve account up to the limit required under UMR Section 8308. Program funds may not be used for the cost of supportive services, although Department approved costs of on-site supportive services coordination may be treated as a project operating cost, payable from operating income. MHP funds must be attributable to the costs of “restricted” units (MHP units and units subject to a long-term regulatory agreement with occupancy and rent restrictions similar to those of MHP) or to the costs of facilities used for childcare, after-school care, and social service integrally linked to the restricted units. A-129 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Eligible Projects Projects must qualify as rental housing developments, as deﬁned in UMR Section 8301, and meet the requirements of Sections 7302 and 7342. For example, projects must contain ﬁve or more dwelling units and contain Supportive Housing units equal to the greater of ﬁve units or 35 percent of the total project units. Supportive Housing units must be restricted to households with incomes not exceeding the greater of 30 percent Area Median Income (AMI) or State Median Income (SMI). Supportive Housing units must be used for permanent housing only. Non Supportive Housing units may be used for either permanent or transitional housing. Projects receiving nine percent (9%) low income housing tax credits (LIHTC) are ineligible. Households Eligible for Supportive Housing Units As deﬁned in Section 7341, to be eligible for Supportive Housing units, households must be homeless or at-risk of homelessness, and include a disabled adult as speciﬁed below. Homeless or at-risk of homelessness means: 1. moving from an emergency shelter; or 2. moving from transitional housing; or 3. currently homeless, meaning: a. an individual who lacks a ﬁxed, regular, and adequate nighttime residence; or b. an individual who has a primary nighttime residence that is: 1. a supervised publicly or privately operated shelter designed to provide temporary living accommodations (including welfare hotels, congregate shelters, and transitional housing for the mentally ill); or 2. an institution that provides a temporary residence for individuals intended to be institutionalized; or 3. a public or private place not designed for, or ordinarily used as, a regular sleeping accommodation for human beings; or 4. at-risk of homelessness, meaning: c. households with incomes at or below the greater of 20 percent of SMI or AMI with no rental subsidy available to the household ; or A-130 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY d. households with incomes above 20 percent but not exceeding 30 percent of the greater of SMI or AMI who: i. face immediate eviction and have been unable to identify a subsequent residence; or ii. face imminent release from an institution (i.e., jail, hospital or foster care system) where other housing placement resources are not available; or iii. reside in an overcrowded setting (more than two persons per living/sleeping area) in which the household does not hold a lease; or reside in substandard housing subject to a current ofﬁcial vacation notice; or iv. pay more than 50 percent of income in housing costs. A disabled adult is a person 18 years of age or older, or an emancipated minor with a qualifying disability. Qualifying disabilities are: 1. Mental illness; or 2. HIV or AIDS; or 3. Substance abuse; or 4. Developmental disability; or 5. Long-term chronic health condition that qualiﬁes them for: a. Eligibility under either of two Medicaid Waiver programs, the Multipurpose Senior Services Program or the Assisted Living Waiver Pilot Program (or its successor); b. Eligibility for 20 or more personal care hours per week under the In-Home Supportive Services Program; or c. Eligibility for services under the Program of All Inclusive Care for the Elderly. Supportive Service and Property Management Requirements Projects shall be designed to provide affordable housing with access to an array of services and amenities for tenants whose ability to live independently would be improved by the availability of such services and amenities. Supportive Housing projects shall be linked to on- site or off-site services that assist the tenant to: retain the housing, improve his or her health, and to maximize his or her ability to live and where possible, work in the community. A-131 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY As part of the MHP application, Sponsors must submit a supportive services plan documenting that the project will ensure the availability of services that meet the needs of the target population served by the project, along with a line-item budget for the supportive services, itemizing all expenses and indicating the sources, amounts, and status (i.e., proposed or committed) of supportive service funds. The primary service provider for the project must demonstrate a minimum of 24 months experience in the provision of services to the targeted population, and a successful history of securing funds for similar activities. The property manager must also have a minimum of 24 months experience in managing a Supportive Housing or Special Needs Population housing project that would qualify as a rental housing development pursuant to UMR Section 8301(o). Maximum Loan Amounts The maximum loan per project is $7,000,000. The maximum loan amount per “restricted” unit is a function of unit size, location, and affordability level. The minimum loan per restricted unit in Riverside County is $45,000. The per-unit loan limits for Riverside County follow. Riverside County MHP Loan Limits Income Level Efﬁciency 1 BR 2 BR 3 BR 4+ BR 60% Income Level $45,000 $45,000 $45,000 $45,000 $45,000 55% Income Level $52,202 $52,779 $54,363 $55,804 $56,956 50% Income Level $59,549 $60,557 $63,726 $66,607 $69,056 45% Income Level $66,751 $68,336 $73,089 $77,411 $81,012 40% Income Level (MHP A) $73,954 $76,114 $82,308 $88,070 $92,968 35% Income Level (MHP B) $81,300 $83,893 $91,671 $98,874 $105,068 30% Income Level (MHP C) $88,502 $91,671 $101,034 $109,677 $117,024 Loan Terms and Security Loans have a 55-year term, and bear simple interest at the rate of three percent (3%) per year. For the ﬁrst 30 years, annual payments will be required in the amount of 0.42 percent (0.42%) of the outstanding principal loan balance. The annual payment amount for the next 25 years will be set by the Department in year 30, and will be the minimum amount necessary to cover the Department’s monitoring costs. Unpaid principal and accrued and deferred interest will be due at the end of the loan term. A-132 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Summary HUD provides funding to nonproﬁt organizations to develop rental housing with the availability of supportive services for very low-income adults with disabilities, and provides rent subsidies for the projects to help make them affordable. Purpose The Section 811 program allows persons with disabilities to live as independently as possible in the community by increasing the supply of rental housing with the availability of supportive services. The program also provides project rental assistance, which covers the difference between the HUD-approved operating costs of the project and the tenants’ contribution toward rent. The program is similar to Supportive Housing for the Elderly (Section 202). Type of Assistance HUD provides interest-free capital advances to nonproﬁt sponsors to help them ﬁnance the development of rental housing such as independent living projects, condominium units and small group homes with the availability of supportive services for persons with disabilities. The capital advance can ﬁnance the construction, rehabilitation, or acquisition with or without rehabilitation of supportive housing. The advance does not have to be repaid as long as the housing remains available for very low-income persons with disabilities for at least 40 years. HUD also provides project rental assistance; this covers the difference between the HUD- approved operating cost of the project and the amount the residents pay--usually 30 percent of adjusted income. The initial term of the project rental assistance contract is ﬁve years and can be renewed if funds are available. The available program funds for a ﬁscal year are allocated to HUD’s local ofﬁces according to factors established by the Department. In Fiscal year 2006, the Department allocated just A-133 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY under $5,000,000 to projects within the jurisdiction of the Los Angeles area HUD. This funding was anticipated to result in the development of 45 units of housing for disabled persons, an investment by HUD of approximately $110,000 per unit. Each project must have a supportive services plan. The appropriate State or local agency reviews a potential sponsor’s application to determine if the plan is well designed to meet the needs of persons with disabilities and must certify to the same. Services may vary with the target population but could include case management, training in independent living skills and assistance in obtaining employment. However, residents cannot be required to accept any supportive service as a condition of occupancy. Eligible Grantees Nonproﬁt organizations with a Section 501(c) (3) tax exemption from the IRS can apply to develop a Section 811 project if they can, among other requirements, submit a resolution that they will provide a minimum capital investment equal to 0.5 percent (0.5%) of the capital advance amount, up to a maximum of $10,000. Eligible Customers In order to live in Section 811 housing, a household which may consist of a single qualiﬁed person must be very low-income (within 50 percent of the median income for the area) and at least one member must be 18 years old or older and have a disability, such as a physical or developmental disability or chronic mental illness. Application Applicants must submit an application for a capital advance, including a Request for Fund Reservation (Form HUD-92016-CA) and other information in response to a Notice of Funding Availability (NOFA) published in the Federal Register each year. Applications must be submitted to the local HUD ﬁeld ofﬁce with jurisdiction over the area where the proposed project will be located. Those selected for funding must meet basic program requirements, including nonproﬁt status, ﬁnancial commitment, and a certiﬁcation from the appropriate State or local agency that the supportive services are well designed to meet the needs of the intended residents. Awards are usually announced in September. A-134 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Technical Guidance This program is authorized by Section 811 of the National Affordable Housing Act of 1990 (P.L. 101-625) as amended by the Housing and Community Development Act of 1992 (P.L. 102-550), the Rescission Act (P.L. 104-19) and the American Homeownership and Opportunity Act of 2000 (P.L. 106-569). Program regulations are in 24 CFR Part 891. To learn more about the Section 811 program, see Section 811 Supportive Housing for Persons with Disabilities (HUD Handbook 4571.2) and Supportive Housing for Persons with Disabilities, Conditional Commitment to Final Closing (HUD Handbook 4571.4) which is available on HUD clips. A-135 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Administrative Agencies Federal: Department of Health and Human Services (HHS), Substance Abuse and Mental Health Services Administration (SAMHSA), Center for Substance Abuse Treatment, (301) 443- 8453, www.samhsa.gov or www.samhsa.gov/grants/grants.html Type Of Assistance Competitive grants with one third of TCE funds for applicants within states and communities with no active TCE grants at time awards are made. Program Description Competitive program to expand or enhance substance abuse treatment capacity in local communities. The Targeted Capacity Expansion (TCE) program is designed to address gaps in treatment capacity by supporting rapid and strategic responses to demands for alcohol and drug treatment services and/or innovative solutions to unmet needs in communities with serious, emerging substance abuse problems. Because States receive substantial funding for substance abuse treatment services via the Substance Abuse Prevention and Treatment (SAPT) Block Grant, SAMHSA/CSAT uses TCE to target speciﬁc local needs that address national treatment priorities and has an interest in funding projects that are consistent with SAMHSA priorities, especially: co- occurring disorders, closing the substance abuse treatment gap, homelessness, aging and criminal justice; and that are consistent with SAMHSA cross-cutting principles: evidence- based treatments, collaboration across community agencies, recovery, cultural competence, community and faith-based programs, violence prevention, and cost-effectiveness. A-136 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Two of the examples listed that are consistent with these priorities and principles are: substance abuse treatment and related support services for homeless persons and substance abuse treatment and related supported services for the elderly and individuals with physical and emotional disabilities. Eligible Target Populations: Not speciﬁc as such however indicates that SAMHSA is interested in funding projects that are consistent with its priorities. (See above.) Eligible Projects/Programs: In addition to basic eligibility requirements, provision of direct substance abuse treatment must be part of the proposed project and at least one provider of substance abuse treatment services must be identiﬁed within the proposal to provide them. TCE grants will not be awarded to applicants that propose only to provide screening, referral or case management when these services are not clearly and speciﬁcally linked to treatment services. The TCE program must provide treatment in outpatient, day treatment or intensive outpatient, or residential programs. If the applicant organization is not a direct provider of substance abuse treatment services, the applicant must document a commitment from an experienced, licensed substance abuse treatment provider to participate in the proposed project. Eligible Use of Funds & Use Restrictions: Substance abuse treatment service expansion and/or enhancement. Expansion of substance abuse treatment services by increasing the availability of treatment services and access to treatment for a larger number of clients. Enhancement of services by improving the quality or intensity of treatment services. • No more than 15 percent of the total grant award may be used for developing the infrastructure necessary for expansion of services. • No more than 20 percent of the total grant award may be used for evaluation and data collection, including GPRA and incentives for completing the evaluation. A-137 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Eligible Applicants/Sponsors: Local governments and federally recognized Tribal authorities and their major organizational units with broad planning, policy, and service coordination responsibilities. Hospitals, community health centers, school systems, or court systems are not eligible. Community- based organizations are not eligible to apply directly for these grants, even if providing services under contract to a unit of government. However, CSAT encourages local government applicants to develop partnerships with these organizations for the provision of services as part of their proposed TCE projects. Applicants must meet two additional criteria: (1) All direct providers of substance abuse services involved in the proposed project must be in compliance with all requirements for licensing, accreditation or certiﬁcation. (2) All direct providers of substance abuse treatment services must have been providing treatment services for a minimum of two years prior to the date of application. At least one substance abuse treatment provider must meet the two-year requirement within the jurisdiction covered in the application. Minimum/Maximum Awards: Maximum: FY 2003, $500,000 in total costs per year. Average Awards: N/A Term of Awards: Grants are awarded for up to three years. Annual continuation awards depend on the availability of funds and progress achieved. Matching Requirements: N/A Formula: N/A, however, CSAT reserves up to one third of TCE funds for applicants within States and communities that have no active TCE grants at the time awards are made. A-138 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Application Process SAMHSA anticipates an annual NOFA with two submission/review cycles per year (in January and September) Authorizing Legislation/statute: Public Health Services Act, Section 509 Regulations/guidelines 45 CFR Parts 74 and 92; PHS Grants Policy Statement; Last published Guidance for Applicants: No. PA 03-001 A-139 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Overview The State of California permits the issuance of Qualiﬁed 501(c)(3) Bonds (the “Bonds”) to ﬁnance the acquisition, construction, installation, expansion or rehabilitation of land, buildings, and equipment to be owned by a nonproﬁt organization as described under Section 501(c)(3) of the Internal Revenue code of 1986 (including religious, charitable, scientiﬁc, testing for public safety, literary or educational purposes). The interest on the Bonds is exempt from federal income taxes; therefore, a nonproﬁt organization can ﬁnance capital projects at a lower interest than conventional ﬁnancing. The Bonds are limited obligations to the conduit issuer, payable solely from revenues or other funds provided by the nonproﬁt organization. A particular issuer, California Statewide Communities Development Agency (CSCDA) can assist nonproﬁt organizations seeking to ﬁnance projects from $1.0 million to $5.0 million through a specialized program it has developed, its Small Issue Public Beneﬁt Program. The California Communities Program Manager will work with the nonproﬁt organization to privately place the tax-exempt note with a qualiﬁed institutional buyer. The Small Issue Public Beneﬁt Program advantages include low-cost access to tax-exempts markets at a ﬁxed-rate and ﬂexible terms. Since its inception, CSCDA has issued more than $10 billion in Qualiﬁed 501(c)(3) bonds for more than 250 nonproﬁt organizations throughout California including: • Hospital and mental health facilities • Private colleges, universities, and K-12 schools • Student dormitories • Multifamily housing facilities • Assisted living facilities • Substance abuse centers • Museums A-140 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The State requires that requires that each nonproﬁt applicant and the proposed project demonstrate a clear public beneﬁt to the community in which the project will reside. Examples of public beneﬁts include (but are not limited to): charitable care or benevolence programs for the indigent, tuition assistance, non-discriminatory enrollment policies, and community outreach (i.e. health and wellness programs, grants and donations, community service initiatives, open campus during non-operating hours). A-141 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The California Debt Limit Allocation Committee (CDLAC) is a three-member body comprised of the State Treasurer as Chair, the Governor, and the State Controller. CDLAC was created in 1985 by Governor proclamation in response to the 1984 Tax Reform Act, which imposed an annual limit on the dollar amount of tax-exempt private activity bonds that may be issued in a state. Private activity bonds included student loan bonds and industrial development bonds (including exempt facility bonds, small-issue industrial development bonds, and bonds for industrial parks). The annual limit was derived by multiplying the state’s population by $150, resulting in a $3.8 billion ceiling at that time. The Act also required each state to designate an entity to allocate the state’s ceiling among various state and local issuers. The 1986 Tax Reform Act made major changes to the allocation of private activity bond authority. It reduced the annual volume cap to $75 per capita in 1986 and 1987 and $50 per capita thereafter. The Act also brought bonds for single-family and multifamily housing under the state ceiling. As a result, a new Governor’s proclamation was issued in 1986 re-afﬁrming CDLAC as the state’s sole entity responsible for allocating the annual ceiling, and expressly uthorizing CDLAC to establish procedures and reserve amounts of the ceiling for certain purposes or issuers. In 1987, the California State Legislature statutorily established CDLAC by enacting Chapter 943. The 1998 Omnibus Budget Act raised the volume cap on private activity bonds to $75 per capita or a minimum of $225 million. However, the increase would take place incrementally over the years 2003 through 2007. The Community Renewal Tax Relief Act of 2000 accelerates the scheduled increase contained in the 1998 Act by raising the volume cap to $62.50 per capita of the state’s population or $187.5 million, whichever is higher, for calendar year 2001 and $75 per capita or $225 million, whichever is higher, in calendar year 2002 and thereafter. The 2000 Act also allows for the volume cap to be indexed for inﬂation starting in calendar year 2003 Federal The purpose of CDLAC is to implement Section 1301 of the Federal Tax Reform Act of 1986 and Section 146 of the Internal Revenue Code which impose a limit on the amount of tax- A-142 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY exempt private activity bonds which a state may issue in a calendar year (i.e. the annual state ceiling). Section 146(d), as amended by the Community Renewal Tax Relief Act of 2000, permits a state to set its annual ceiling at $187,500,000 or an amount equal to $62.50 per capita of its population, whichever is higher, in calendar year 2001. In calendar year 2002 and thereafter, the ceiling will rise to $225,000,000 or an amount equal to $75 per capita, whichever is higher. Beginning in calendar year 2003, the ceiling will be adjusted annually for inﬂation. The actions of CDLAC are fundamentally deﬁned and limited by federal tax law. Federal tax law deﬁnes the term “private activity bond”; limits the volume of private activity bonds which a state may issue in a calendar year; deﬁnes the types of programs and projects which qualify for tax-exempt bond ﬁnancing under the volume cap; and speciﬁes recordkeeping requirements. State CDLAC was statutorily created by Chapter 943, Statutes of 1987, in response to the 1986 Federal Tax Reform Act. California Government Code Section 8869.80 et seq. deﬁnes CDLAC’s responsibilities as follows: • Set the Annual State Ceiling: CDLAC is required to establish the state ceiling as soon as is practicable after the start of each calendar year. • Allocate the State Ceiling: CDLAC is granted the sole authority for allocating the annual ceiling. • Other Administrative Functions: CDLAC is authorized to prepare forms, establish procedures, set priorities, require a performance deposit, assess fees, and perform other administrative functions as necessary. Additionally, in establishing CDLAC the Legislature emphasized the substantial public beneﬁt of promoting housing for lower income families and individuals and of preserving and rehabilitating existing governmental assisted housing for lower income families and individuals. State and local governmental agencies and joint powers authorities can issue tax-exempt housing revenue bonds. These bonds assist developers of multifamily rental housing units to acquire land and construct new units or purchase and rehabilitate existing units. The tax- A-143 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY exempt bonds lower the interest rate paid by the developers. The developers in turn produce market rate and affordable rental housing for low and very low-income households by reducing rental rates to these individuals and families. Projects that receive an award of bond authority have the right to apply for non-competitive four percent (4%) tax credits. www. treasurer.ca.gov/ctcac Bond authority for Rental Projects is awarded to three sub-pools: the General Pool (Projects having more than 50 percent of total units designated as Restricted Rental Units); the Mixed Income Pool (Projects having 50 percent or fewer of total units designated as Restricted Rental Units); and the Rural Project Pool (Projects located in a rural area as deﬁned by California Health and Safety Code Section 50199.21 but shall not include a Mixed Income Project). A-144 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Administrative Agencies Federal: • Department of Health and Human Services: Administration for Children and Families Ofﬁce of Family Assistance (202) 401-5139 www.acf.hhs.gov/programs/ofa/index.htm California: • California Department of Social Services: California Health and Human Services Agency www.dss.cahwnet.gov/cdssweb/california_169.htm Riverside: Department of Public Social Services www.dpss.co.riverside.ca.us/dpss/CalWorks.aspx Type Of Assistance: Formula Program Description In 1996, Congress established the Temporary Assistance for Needy Families program (TANF), creating a ﬂexible block grant that replaced the former cash assistance entitlement program, Aid to Families with Dependent Children (AFDC). TANF, called CalWORKS in California, provides funds that must be matched by the states for income support and a wide range of service for eligible needy families and individuals. A-145 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY There are two sources of CalWORKS program spending, each with its own requirements and restrictions: (1) the federal TANF block grant to the states; and, (2), state of California spending required to match the Federal block grant called “maintenance of effort” (MOE) spending. (States must spend 75–80 percent of the ﬁscal year 1994 state spending level they had spent under the AFDC program.) TANF and MOE funds are disbursed to subdivisions of government, including the County of Riverside which administers this program through the Department of Social Services. Federal TANF funds are provided to states with different restrictions on use, depending on what types of beneﬁts are provided. Regulations impose time limits on aid (generally 18 months for a single period of assistance and not more than 60 months in a lifetime for most welfare recipients) as well as work and child support requirements for any family receiving beneﬁts from CalWORKS funds. Welfare beneﬁts and Medicaid are de-linked as well. States are afforded a great deal of ﬂexibility in deciding how to spend TANF funds as long as the expenditure is reasonably calculated to accomplish a purpose of the TANF program, as follows: • assisting needy families so that children can be cared for in their own homes • reducing dependency of needy parents by promoting job preparation, work and marriage • preventing out-of-wedlock pregnancies • encouraging the formation and maintenance of two-parent families. In general, states have more discretion in spending MOE funds than Federal TANF funds as follows: state MOE funds may be used for more ﬂexible purposes, but must serve a more limited pool of TANF-eligible families; Federal TANF funds can serve a broader population, but may have more restrictions or prohibitions regarding allowable uses. While beneﬁts provided under the ﬁrst two TANF purposes are limited to parents and families that meet the state’s deﬁnition of “needy” (deﬁned as ﬁnancially deprived according to income and related criteria), Federal TANF funds may be used to provide services that are not considered “assistance” to a broader population of families (e.g., non-custodial parents). That is, under certain circumstances states may extend beneﬁts to persons who may not meet the strict deﬁnition of “needy.” Under TANF purposes 3 and 4, states may use Federal TANF funds to extend beneﬁts that are not considered “assistance” to individuals or family members A-146 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY regardless of their income or household composition (i.e., who are not “needy”), but who meet other objective eligibility criteria established by the state. Regardless of whether Federal TANF or California MOE funds are used to provide “assistance,” the TANF requirements prevail. When planning to use TANF funds for a particular service, the State Department of Public Social Services determines whether Federal or state funds are the most appropriate source for that activity. (For further details on the deﬁnition of “assistance” see the ﬁnal TANF regulations 45 CFR 260.31.) Annual TANF block grant allocations to the states are based on federal funding levels from 1994 or 1995 (by choice of the state), when welfare caseloads were much higher. Because of signiﬁcantly declining caseloads and ﬁxed funding levels, periodically a number of states (but not California) have had surplus TANF dollars. These excess funds create new opportunities to provide a wide range of needed work supports to eligible families, including: transportation; child care assistance; substance abuse treatment; mental health treatment; domestic violence counseling; and housing assistance. As such, CalWORKS can be an important revenue source for housing assistance and services in supportive housing for homeless families, non-custodial parents, and transition-aged youth, subject to certain limitations. The goal of assisting homeless populations with supports may thus be furthered with CalWORKS funding. Eligible Target Populations: States determine eligible target populations within Federal guidelines that provide: • Low-income families who meet the state’s income guidelines, have a minor child living with an adult relative in the home, and have not exceeded their ﬁve-year lifetime limit for receiving assistance (i.e., “needy” families with children.) • Former recipients of TANF cash assistance (for certain TANF activities) • Non-custodial parents of TANF-eligible families (for certain TANF activities) • Non-needy families or individuals (who don’t meet the state’s TANF income level or certain other restrictions) for activities related to prevention of out-of-wedlock pregnancy and encouragement of the formation and maintenance of two-parent families. A-147 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY TANF imposes complex requirements regarding the immigration status of TANF recipients. (Consult PRWORA.) Homeless services providers serving CalWORKS-eligible families and/or non-custodial parents of CalWORKS families who have multiple barriers to work or transition-aged youth have the best case for getting surplus TANF funds based on their ability to meet fundamental TANF purposes, i.e., stable affordable housing improves employment outcomes; housing and services to transition-aged youth to prevent and end homelessness can meet the goal of preventing out of wedlock births. Eligible Use of Funds & Use Restrictions: In addition to cash beneﬁts, CalWORKS permits the use of TANF funds for: job training; employment services (e.g., job search, job placement, work subsidies, etc.); childcare assistance (e.g., child care, subsidies, after-school and summer activities, etc.); transportation; education and training; substance abuse counseling; mental health treatment; non-medical substance abuse services (e.g., counseling, room and board costs at residential treatment programs); vocational rehabilitation services, housing/rental assistance (including security deposits, payments of back rent to prevent evictions, subsidies, loans, etc.); case management services; and other supportive services in support of TANF’s program purposes. States also may transfer a limited portion of their assistance grant funds to the Child Care and Development Block Grant (CCDBG) and the Social Services Block Grant (SSBG) Programs. TANF funds may not be used for capital costs or medical services. In general, TANF funds and/or state funds used to match them may be used to pay for many of the services that would be included in a comprehensive system of care for homeless persons and families. This is particularly the case if the services are designed to help families participate in welfare to work activities or address barriers to employment like substance abuse addictions. TANF funds may also be used for some services in projects serving youth leaving the foster care system. As is usually the case with Federally-funded programs, the eligible activities and populations (i.e. the funding source) determines what services may be available to homeless populations. Moreover, CalWORKS funds may also be used for time- limited assistance with housing operating costs (e.g., rent subsidies) making them appropriate as a source of operations funding for transitional housing programs. A-148 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Eligible Applicants/Sponsors: State governments, Territories, the District of Columbia, and all federally recognized Tribes in the lower 48 states and 13 speciﬁed entities in Alaska are eligible. Minimum/Maximum Awards: N/A Average Awards: N/A Term of Awards: Annual awards Matching Requirements: The TANF program has an annual cost-sharing requirement, referred to as “maintenance of effort” (MOE). Every ﬁscal year, each state must spend a certain minimum amount of its own resources to help eligible families in ways that are consistent with the purposes of the TANF program. The rate is determined by whether the state meets the work participation rates: if it does, it must match TANF funds with an amount equal to 75 percent of what it spent for ﬁscal year 1994 or 1995 (by choice of state) on AFDC and AFDC-related programs; if it does not, it must provide an 80 percent match. Formula: TANF funding is allocated to states based on a formula that matches state spending for AFDC in ﬁscal year 1994 or 1995 (by choice of state). (See Matching Requirements above.) Application Process States and others that operate TANF programs must develop a State plan that must be approved by the Department of Health and Human Services. Federal and state matching funds are generally administered by local government welfare departments. Supportive housing sponsors serving tenants who are TANF-eligible will, in most instances, need to advocate at the state and local levels to access TANF funds for services in supportive housing. The leverage (or “selling point”) for supportive housing sponsors is the comprehensive, wraparound support provided in supportive housing for people with multiple barriers to work. A-149 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY California: California’s TANF program is called CalWORKs. -- California Work Opportunity and Responsibility to Kids. CFDA Code: 93.558 Authorizing Legislation/statute Social Security Act, Title IV, Part A, as amended: Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA), Public Law 104-193; Balanced Budget Act of 1997, Public Law 105-33. Regulations/guidelines TANF Final Rule, published in Federal Register on April 12, 1999 (Vol. 64, No. 69). Program rules for State programs found at 45 CFR Parts 260-265. Tribal TANF Final Rule, published in Federal Register on February 18, 2000 (Vol. 65, No. 34). Tribal program rules found at 45 CFR Part 286. Additional Resources • “Using TANF Funds to Finance Essential Services in a Supportive Housing Program for Homeless Families and Young Adults,” Doreen Straka, Constance Tempel, Corporation for Supportive Housing, and Karen Lipson, Kalkines, Arky, Zall & Bernstein LLP, www.csh.org (Resources by Topic, Services Planning/TANF) • “The Increasing Use of TANF and State Matching Funds to Provide Housing Assistance to Families Moving from Welfare to Work - 2001 Supplement”, Barbara Sard and Tim Harrison, The Center for Budget and Policy Priorities, www.cbpp.org/12-3-01hous.pdf • “Helping Families Achieve Self-Sufﬁciency: A Guide on Funding Services for Children and Families through the TANF Program,” Department of Health and Human Services, Administration for Children and Families, Ofﬁce of Family Assistance, www.acf.hhs.gov/ programs/ofa/funds2.htm • HUD’s website describing using surplus TANF funds to fund services http://www.hud. gov/pih/programs/ph/wtw/4HH.html • All the State Welfare Children and Families home pages are accessed at www.acf.dhhs. gov/news/welfare/stlinks.htm A-150 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY HUD collects and publishes information about surplus federal property that can be used to help homeless persons. Eligible grantees include states, local governments, and nonproﬁt organizations. Federal Agency Ofﬁce of Special Needs Assistance Programs, Department of Housing and Urban Development, 451 7th Street, SW, Washington, DC 20410. Authorization McKinney-Vento Homeless Assistance Act of 1987, as amended November 29, 1990, Title V, Public Law 101-645 (42 USC 11411). Program Title V of the McKinney-Vento Act provides suitable Federal properties categorized as unutilized, underutilized, excess, or surplus for use to assist homeless persons. Properties are made available to States, units of local government, and non-proﬁt organizations. Properties can be used to provide shelter, services, storage, or other uses of beneﬁt to homeless persons. The program provides no funding, and the properties are made available on an “as is” basis. Properties are leased without charge, although the homeless organization must pay for operating and repair costs. Depending on the availability of the property, and other factors, surplus properties may also be deeded to the organization. Suitability Process HUD collects information from Federal agencies concerning their unutilized, underutilized, excess and surplus properties and determines which are suitable for use to assist homeless persons. The determination is based on information submitted by the agency controlling the property. HUD publishes a weekly (every Friday) Federal Register notice listing property determinations and availability. A-151 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Application Process The Department of Health and Human Services (HHS) handles the application portion of the program. Interested providers should notify HHS of their intention to apply for property within 60 days of the Federal Register notice. Applicants have 90 days after an expression of interest is received by HHS to submit an application. Once an application is complete, HHS acts on it within 25 days. The landholding agency enters into a license, permit, or lease agreement for homeless provider’s use of unutilized or underutilized property. HHS handles the lease or deed document for surplus properties. Information Contacts HUD Field Ofﬁces: Contact the HUD ﬁeld ofﬁce for your state to obtain property information and/or to be put on a mailing list. Landholding Agencies: Further information on speciﬁc properties can be obtained from the landholding agency. The name and number to contact can be obtained from the HUD ﬁeld ofﬁce or the HUD toll-free number (below). HUD Headquarters Ofﬁce: Kathy Ezzell, Ofﬁce of Special Needs Assistance Programs, Ofﬁce of Community Planning and Development, Department of Housing and Urban Development, Room 5B-17, 451 7th Street, SW, Washington, DC 20410. Telephone Number: (202) 708-1234. HUD’s Toll Free: Title V information number at 1-800-927-7588. HHS: To obtain an application packet for a particular property, write to the U.S. Department of Health and Human Services, Division of Property Management, Program Support Center, Room 5B-41, Parklawn Building, 5600 Fishers Lane, Rockville, MD 20857. Telephone Number: (301) 443-2265. Your letter should identify the property in which you are interested, including the date of the Federal Register notice in which it was published, and request an application packet. A-152 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Federal: • Department of Health and Human Services (DHHS): Administration for Children & Families (ACF) Family and Youth Services Bureau (FYSB) (202) 205-8102 www.acf.hhs.gov/programs/fysb/tlp.htm Type Of Assistance: Competitive Program Description Part of the Runaway and Homeless Youth Program, the Transitional Youth Program for Older Homeless Youth (TLP) is a national competitive grants program to fund transitional living projects that provide shelter, skills training and support services for homeless youth, including pregnant and parenting youth, ages 16 to 21 for a maximum of 18 months. The goal of the program is to help older homeless youth achieve self-sufﬁciency and avoid long- term dependency on social services. Eligible Target Populations: Homeless youth, including pregnant and parenting youth, ages 16 through 21 years old. Eligible Projects/Programs: Transitional Living Programs are required to provide youth with stable, safe living accommodations and services that help them develop the skills necessary to move to independent adult life within eight months. A-153 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • Shelter or Living accommodations must be provided through: a group home facility, family host homes and/or “supervised apartments” (either agency-owned apartment buildings or “scattered site” apartments rented directly by young people with support from the agency). Maternity homes are also eligible for funding. • Skills training must include, but is not limited to: basic life skill-building (including consumer education and instruction in budgeting, using credit, housekeeping, menu planning and food preparation); interpersonal skills building (including enhancing young people’s abilities to establish positive relationships with peers and adults, make decisions, and manage stress); educational advancement (such as GED preparation, post-secondary training or vocational education); and, job preparation and attainment (such as career counseling and job placement) A-154 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Administrative Agencies Federal: • Department of Health and Human Services (HHS): Substance Abuse and Mental Health Services Administration (SAMHSA) Center for Substance Abuse Treatment (301) 443-7945 www.samhsa.gov or www.samhsa.gov/grants/grants.html Type of Assistance: Competitive Program Descripton Competitive program to enable communities to expand and strengthen their treatment services for homeless individuals with substance abuse disorders, mental illness, or with co- occurring substance abuse disorders and mental illness. Eligible Target Populations: Homeless individuals with a diagnosable substance abuse disorder, diagnosable mental illness, or with co-occurring substance abuse disorder and mental illness. This population includes single adults, families, veterans, and runaway and street youth with long or multiple episodes of homelessness. “Homeless” persons are those who lack a ﬁxed, regular, adequate nighttime residence, including persons whose primary nighttime residence is: a supervised public or private A-155 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY shelter designed to provide temporary living accommodations; a time-limited/nonpermanent transitional housing arrangement for individuals engaged in mental health and/or substance abuse treatment; or a public or private facility not designed for, or ordinarily used as, a regular sleeping accommodation. “Homeless” also includes those who are “doubled up” deﬁned as sharing another person’s dwelling on a temporary basis where continued tenancy is contingent upon the hospitality of the primary leaseholder or owner and can be rescinded at any time without notice. Eligible Projects/Programs: Applicant projects must demonstrate a thorough understanding of the current knowledge and practices in the identiﬁcation and treatment of homeless people with substance abuse disorders, mental illness, and/or co-occurring disorders. Programs must be able to show that their program design and service interventions are founded on evidence-based practice, best practice, or promising practice. Applicants need to describe the treatment, services and housing resources within the community where the proposed project will be conducted as well as the roles of participating organizations, how they will support the proposed project, including letters of commitment from participating and coordinating organizations. Applicants must show how treatment services are linked with housing programs and other services for homeless persons. Eligible Use of Funds & Use Restrictions: Substance abuse and/or mental health treatment services for homeless people, including: • Strengthen or expand an existing substance abuse treatment and/or mental health services program to include persons who are homeless; • Provide substance abuse treatment and/or mental health services to persons participating in homeless programs; • Provide substance abuse treatment and/or mental health services and related supportive services to maintain persons in stable housing; • Develop referral linkages with community services providers to create a “no wrong door” approach for accessing substance abuse and mental health treatment and services for their clients; A-156 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • Promote immediate entry to substance abuse treatment and/or mental health services by increasing treatment capacity where gaps exist; • Enable participation in substance abuse treatment and/or mental health services by providing wrap-around services such as transportation or child care. Housing Access and Stability: • Link homeless people with substance abuse and/or mental illness to housing and promote residential stability; • Build linkages among substance abuse treatment providers and/or mental health services providers, housing providers, and homeless service providers; • Purchase groceries or household supplies and pay utility bills, on an emergency or short- term basis, which are necessary to enable a person to remain housed. Education Activities: • Educate individuals on how to refer persons who are homeless to appropriate substance abuse treatment and/or mental health services; • Train direct care providers and other in the system serving the target population about provision of substance abuse treatment and/or mental health services to persons who are homeless. Grant funds may not be used to pay for housing (other than residential substance abuse treatment or residential mental health programs), to carry out syringe exchange programs, or to pay for pharmacologies for HIV antiretroviral therapy, STDS, TB and hepatitis B and C. Eligible Applicants/Sponsors: Community-based public and private non-proﬁt entities. Community-based public entities are those public entities located in the community and would include tribal and local governments that provide community-based services. Private nonproﬁt entities include community-based and faith-based organizations. States are not eligible to apply. Applicants need not be direct providers of substance abuse treatment or mental health services. Eligible applicants also include providers of homeless services, primary health care, housing, and other closely linked services for persons with substance abuse, mental illness, or co-occurring disorders. A-157 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Only existing, experienced providers with demonstrated infrastructure and expertise will be funded: if the applicant or any partners in the proposed system is a direct provider of substance abuse treatment or mental health services, a minimum of two years experience and licensure/accreditation prior to the date of the application is required. If the applicant is not a direct provide of substance abuse treatment or mental health services, the applicant must document a commitment from such to participate in the proposed project. Currently there are about 30 grants made under this program of which approximately half have been for services in permanent supportive housing or transitional housing/residential settings. To meet the goal of geographic diversity, SAMHSA usually funds no more than two applications per state per year. Minimum/Maximum Awards: FY 2003, maximum amount was $600,000 per year in total costs. Average Awards: FY 2003, average awards were from $450,000 - $600,000 per year in total costs. Term of Awards: Grants were awarded for a period of up to three years (although statutorily the period can be up to ﬁve years.) Annual awards are made subject to continued availability of funds and progress achieved by the grantee. Matching Requirements: N/A Formula: N/A Application Process Annual NOFA with one application submission per year. Authorizing Legislation/statute Public Health Services Act, Section 506, as amended A-158 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Regulations/guidelines 45 CFR Parts 74 and 92; PHS Grants Policy Statement; Last published Guidance for Applicants: No. SP 03 -005; Last published Guidance for Applicants: No. TI 02-006 A-159 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Program Description: VA’s Homeless Providers Grant and Per Diem Program is offered annually (as funding permits) by the Department of Veterans Affairs Health Care for Homeless Veterans (HCHV) Programs to fund community agencies providing services to homeless veterans. The purpose is to promote the development and provision of supportive housing and/or supportive services with the goal of helping homeless veterans achieve residential stability, increase their skill levels and/or income, and obtain greater self-determination. Only programs with supportive housing (up to 24 months) or service centers (offering services such as case management, education, crisis intervention, counseling, etc.) are eligible for these funds. The program has two levels of funding: the Grant Component and the Per Diem Component. Grants: Limit is 65 percent of the costs of construction, renovation, or acquisition of a building for use as service centers or transitional housing for homeless vets. Renovation of VA properties is allowed, acquiring VA properties is not. Recipients must obtain the matching 35 percent share from other sources. Grants may not be used for operational costs, including salaries. Per Diem: Priority in awarding the Per Diem funds goes to the recipients of Grants. Non- Grant programs may apply for Per Diem under a separate announcement, when published in the Federal Register, announcing the funding for “Per Diem Only.” Operational costs, including salaries, may be funded by the Per Diem Component. For supportive housing, the maximum amount payable under the per diem is $29.31. Veterans in supportive housing may be asked to pay rent if it does not exceed 30 percent of the veteran’s monthly-adjusted income. In addition, “reasonable” fees may be charged for services not paid with Per Diem funds. The maximum hourly per diem rate for a service center not connected with supportive housing is 1/8 of the daily cost of care, not to exceed the current VA State Home rate for domiciliary care. Payment for a veteran in a service center will not exceed 8 hours in any day. A-160 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Applications are not accepted for Capital Grants or “Per Diem Only” funding until the Notice of Funding Availability (NOFA) is published in the Federal Register. Funds will be awarded to programs determined to be the most qualiﬁed. The contact person for the Homeless Providers Grant and Per Diem Program is Roger Casey. Mr. Casey’s address is VA Homeless Providers Grant and Per Diem Program, Mental Health Strategic Healthcare Group (116E), VAHQ, 810 Vermont Avenue, NW, Washington, DC 20420; telephone (toll-free): 1-877-332-0334; E-mail: email@example.com. The HCHV programs are administered nationally by Paul Smits, Associate Chief Consultant, Homeless and Residential Rehabilitation and Treatment Programs, VA Headquarters in Washington, D.C. A-161 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY One-third of adult homeless men and nearly one-quarter of all homeless adults have served in the armed forces. While there is no true measure of the number of homeless veterans, it has been estimated that fewer than 200,000 veterans may be homeless on any given night and that twice as many veterans experience homelessness during a year. Many other veterans are considered at risk because of poverty, lack of support from family and friends and precarious living conditions in overcrowded or substandard housing. Ninety-six percent of homeless veterans are male and the vast majority is single. About half of all homeless veterans suffer from mental illness and more than two-thirds suffer from alcohol or drug use problems. Nearly 40 percent have both psychiatric and substance abuse disorders. The Department of Veterans Affairs (VA) is the only federal agency that provides substantial hands-on assistance directly to homeless people. In 2005, VA provided health care to more than 100,000 homeless veterans and other services to over 60,000 veterans in its specialized homeless programs. More than 40,000 homeless veterans receive compensation or pension beneﬁts annually. Although limited to veterans and their dependents, VA’s major homeless programs constitute the largest integrated network of homeless assistance programs in the country, offering a wide array of services to help veterans recover from homelessness and live as self-sufﬁciently and independently as possible. Nearly three-quarters of homeless veterans we have contacted use VA health care and 55 percent have used VA homeless services. VA, using its own resources or in partnerships with others, has secured more than 15,000 residential rehabilitative, transitional and permanent beds for homeless veterans throughout the nation. VA spends more than one billion dollars from its health care and beneﬁt assistance programs to assist homeless and at-risk veterans. To increase this assistance, VA conducts outreach to connect homeless veterans to both mainstream and homeless-speciﬁc VA programs and beneﬁts. These programs strive to offer a continuum of services that include: • Aggressive outreach to veterans living on the streets and in shelters who otherwise would not seek assistance; • Clinical assessment and referral for treatment of physical and psychiatric disorders, including substance abuse; A-162 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY • Long-term transitional residential assistance, case management and rehabilitation; and, • Employment assistance and linkage with available income supports and permanent housing. VA has awarded more than 400 grants to public and nonproﬁt groups to assist homeless veterans in all states and the District of Columbia to provide transitional housing, service centers and vans to provide transportation to services and employment. VA sponsors and supports national, regional and local homeless conferences and meetings, bringing together thousands of homeless providers and advocates to discuss community planning strategies and to provide technical assistance in such areas as transitional housing, mental health and family services, education and employment opportunities for the homeless. Homeless Programs VA’s Health Care for Homeless Veterans Program (HCHV) operates at 132 sites, where extensive outreach, physical and psychiatric health exams, treatment, referrals and ongoing case management are provided to homeless veterans with mental health problems, including substance abuse. This program makes assessments and referrals for more than 40,000 veterans annually. VA’s Domiciliary Care for Homeless Veterans (DCHV) Program provides medical care and rehabilitation in a residential setting on VA medical center grounds to eligible ambulatory veterans disabled by medical or psychiatric disorders, injury or age and who do not need hospitalization or nursing home care. There are more than 1,800 beds available through the program at 34 sites. The program provides residential treatment to more than 5,000 homeless veterans each year. The domiciliaries conduct outreach and referral; admission screening and assessment; medical and psychiatric evaluation; treatment, vocational counseling and rehabilitation; and post-discharge community support. Veterans Beneﬁts Assistance at VA Regional Ofﬁces is provided by designated staff members who serve as coordinators and points of contact for homeless veterans. Homeless coordinators at VA regional ofﬁces provide outreach services and help expedite the processing of homeless veterans’ claims. The Homeless Eligibility Clariﬁcation Act allows eligible veterans without a ﬁxed address to receive VA beneﬁts checks at VA regional ofﬁces. A-163 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY VA also has procedures to expedite the processing of homeless veterans’ beneﬁts claims. Last year more than 34,000 homeless veterans received assistance and nearly 4,000 had their claims expedited by staff members. Acquired Property Sales for Homeless Providers Program makes properties VA obtains through foreclosures on VA-insured mortgages available for sale to homeless providers at a discount of 20 to 50 percent. To date, more than 200 properties have been sold. These properties have been used to provide homeless people, including veterans, with over 400,000 sheltered nights in VA acquired property since the program began. Readjustment Counseling Service’s Vet Centers provide outreach, psychological counseling, supportive social services and referrals to other VA and community programs. Every Vet Center has a homeless veteran coordinator assigned to make sure services for homeless veterans are tailored to local needs. Annually, the program’s 207 Vet Centers see approximately 130,000 veterans and provide more than 1,000,000 visits to veterans and family members. More than 10,000 homeless veterans are served by the program each year. Veterans Industry/Compensated Work-Therapy (CWT) and Compensated Work- Therapy/Transitional Residence (TR) Programs Through its CWT and TR programs, VA offers structured work opportunities and supervised therapeutic housing for at-risk and homeless veterans with physical, psychiatric and substance abuse disorders. VA contracts with private industry and the public sector for work by these veterans, who learn new job skills, re-learn successful work habits and regain a sense of self-esteem and self-worth. Veterans are paid for their work and, in turn, make a payment toward maintenance and upkeep of the residence. VA operates 66 homes with more than 520 beds in transitional residences. Nine sites with 18 houses serve homeless veterans exclusively. Two-thirds of all CWT and TR beds served homeless veterans. There are more than 140 CWT operations nationwide. Approximately 14,000 veterans participate in CWT programs annually. VA’s National Cemetery Administration and Veterans Health Administration have formed partnerships at national cemeteries, where formerly homeless veterans from the CWT program have received therapeutic work opportunities while providing VA cemeteries with a supplemental work force. A-164 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY HUD-VA Supported Housing (VASH) Program, a joint program with the Department of Housing and Urban Development (HUD), provides permanent housing and ongoing treatment to homeless mentally ill veterans and those suffering from substance abuse disorders. HUD’s Section 8 voucher program has designated more than 1,400 vouchers worth $44.5 million for chronically mentally ill homeless veterans, and VA personnel at 34 sites provide outreach, clinical care and case management services. This approach signiﬁcantly reduces homelessness for veterans plagued by serious mental illness and substance abuse disorders. VA’s Supported Housing Program allows VA personnel to help homeless veterans secure long-term transitional or permanent housing. They also offer ongoing case management services to help the veterans remain in housing they can afford. VA staff work with private landlords, public housing authorities and nonproﬁt organizations to ﬁnd housing arrangements. Veteran service organizations have been instrumental in helping VA establish these housing alternatives nationwide. VA staff at 20 supported housing program sites helped more than 1,500 homeless veterans ﬁnd transitional or permanent housing in the community. Stand Downs are one-to three-day events that provide homeless veterans a variety of services and allow VA and community-based service providers to reach more homeless veterans. Stand downs give homeless veterans a temporary refuge where they can obtain food, shelter, clothing and a range of community and VA assistance. In many locations, stand downs provide health screenings, referral and access to long-term treatment, beneﬁts counseling, ID cards and access to other programs to meet their immediate needs. Each year, VA participates in more than 100 stand downs coordinated by local entities. Surveys show that more than 20,000 veterans and family members attend these events annually with more than 13,000 volunteers. VA Excess Property for Homeless Veterans Initiative provides federal excess personal property, such as clothing, footwear, sleeping bags, blankets and other items, to homeless veterans through VA domiciliaries and other outreach activities. This initiative has been responsible for the distribution of nearly $150 million in material and currently has more than $15 million in inventory. This initiative employs formerly homeless veterans to receive, warehouse and ship these goods to homeless programs across the country that assist veterans. A-165 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY The Homeless Providers Grant and Per Diem Program provides grants and per diem payments to help public and nonproﬁt organizations establish and operate new supportive housing and service centers for homeless veterans. Grant funds may also be used to purchase vans to conduct outreach or provide transportation for homeless veterans. Since the program’s inception in ﬁscal year 1994, VA has awarded more than 400 grants to faith and community- based service providers, state or local government agencies and Native American tribal governments in all states and the District of Columbia. Up to 20,000 homeless veterans are expected to receive supported housing under this program annually in more than 10,000 beds. Project CHALENG (Community Homelessness Assessment, Local Education and Networking Groups) for Veterans is a nationwide initiative in which VA works with other federal, state and local agencies and nonproﬁt organizations to assess the needs of homeless veterans. CHALENG groups have held conferences, developed directories of local resources available to homeless veterans and established local action plans to ﬁght homelessness and prepare strategies for future actions. Program Monitoring and Evaluation conducted by the Northeast Program Evaluation Center at the VA Connecticut Health Care System provides important information about the veterans served and the therapeutic value and cost-effectiveness of VA’s specialized homeless programs. Information from these evaluations also helps program managers determine new directions for expanding and improving services to homeless veterans. VA conducted a one- day census to determine the extent of homelessness among veterans in VA’s acute inpatient programs (1995-2000) and found that one-quarter of all veterans in VA beds were homeless. The Multifamily Transitional Housing Loan Guarantee for Homeless Veterans Program has made conditional commitments to two projects to establish housing for formally homeless veterans. Efforts continue to locate additional projects. VA’s 15-member Advisory Committee on Homeless Veterans submitted its fourth annual report to provide advice and recommendations to the Secretary of Veterans Affairs on the provision of beneﬁts and services to homeless veterans. Nine new Domiciliary Residential Rehabilitation Treatment Programs (DRRTP) have been funded to address the needs of homeless veterans. New DRRTPs will be located in areas identiﬁed as having the greatest need. This funding will add 408 additional beds to the A-166 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY homeless DRRTPs to serve homeless veterans. This will bring the total number of programs to 43 with over 2,000 operational beds. VA is working to expand dental care to homeless veterans. VA will expand Veterans Industry/Compensated Work Therapy Program to twenty ﬁve additional facilities. When the expansion is completed the VA will have over 150 Compensated Work Therapy Programs. VA has initiated outreach to veterans at risk of homelessness who are being discharged or released from incarceration. State-speciﬁc resource guides for incarcerated veterans have been developed that provide contact information and outline steps that veterans can take to plan their re-entry into the community. For more information: • Visit the VA website at www.va.gov, • Contact VA’s Homeless Veterans Programs Ofﬁce at (202) 273-5764, or • E-mail VA at firstname.lastname@example.org. A-167 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY B APPENDIX B-1 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Emergency Shelter Inventory, County of Riverside by District Year-Round Total Year- Family Indiv. Round Other Beds Provider Name Facility Name City District Units Beds Beds Beds Seasonal Voucher Unincorporated County Inventory Alpha Omega Homes Shelter Alpha Omega Ranch 0 0 40 40 0 0 Alternative to Domestic Violence Horizon House 3 10 5 15 0 0 EFSP Local Board & DPSS Motel Voucher 0 0 0 0 0 75 Program Riverside County Countywide 1,2,3,4,5 3 10 45 55 0 75 ALLOCATION 1 2 9 12 0 15 District 1 Countywide Allocation 1 1 2 9 12 0 15 EFSP Local Board & DPSS WS Program Riv. 1 0 0 0 0 80 0 Operation Safe House Safe House Riv. 1 0 0 17 17 0 0 Path of Life Ministries, Inc. Family Shelter Riv. 1 0 50 0 50 0 0 Path of Life Ministries, Inc. Year Rd Shelter Riv. 1 0 0 64 64 0 0 Total District 1 1 52 90 143 80 15 District 2 Countywide Allocation 2 1 2 9 12 0 15 EFSP Local Board & DPSS WS Program Riv. 2 0 0 0 0 40 0 Corona Homeless Task Force Circle of Hope Corona 2 0 25 25 50 0 0 Total District 2 1 27 32 61 140 15 District 3 Countywide Allocation 3 1 2 9 12 0 15 Valley Restart Shelter, Inc. Restart Center Hemet 3 0 40 35 75 0 12 Total District 3 1 42 44 87 0 27 District 4 Countywide Allocation 4 1 2 9 12 0 15 ABC Recovery Center ABC Center Indio 4 0 0 15 15 0 0 Coachella Valley Rescue Mission Coachella Valley Indio 4 4 12 46 58 0 0 Mission Shelter EFSP Local Board & DPSS WS Program Indio 2 0 0 0 0 100 0 Jewish Family Services, Inc. Coachella Vly Ser. 4 0 0 25 25 0 0 & Sh. Shelter From the Storm Mary Stuart PD 4 15 60 0 60 0 0 Rogers Center Episcopal Community Services Nightingale PS 4 12 40 0 40 0 0 Martha’s Village St. Vcnt de Paul Indio 4 0 0 0 0 100 0 Total District 4 32 114 95 210 200 15 District 5 Countywide Allocation 5 1 2 9 12 0 15 None 5 0 0 0 0 0 0 Total District 5 1 2 9 12 0 15 TOTAL EMERGENCY SHELTER INVENTORY 34 185 215 398 40 87 B-2 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Transitional Housing Inventory, County of Riverside by District Year-Round Total Year- Family Indiv. Round Provider Name Facility Name City District Units Beds Beds Beds Unincorporated County Inventory Department of Mental Health AB 2034 County- 0 0 42 42 Scattered Site wide Riverside County Countywide 0 0 42 42 ALLOCATION 1,2,3,4,5 0 0 8 8 District 1 Countywide Allocation 0 0 8 8 Jefferson Transitional Housing Jefferson TH Riv. 1 0 0 30 30 Lutheran Social Services Genesis Riv. 1 8 32 0 32 Lutheran Social Services Amelia’s Light Riv. 1 32 88 0 88 Operation Safe House Main Street Riv. 1 0 0 20 20 Total District 1 40 120 58 178 District 2 Countywide Allocation 0 0 8 8 Corona Homeless Task Force Circle of Hope Corona 2 0 15 20 35 MFI Recovery Center A Women’s Place Riv. 2 14 42 42 Whiteside Manor Dly Diag. Pgm. Riv. 2 0 0 30 30 Whiteside Manor Recovery Pgm. Riv. 2 0 0 52 52 Total District 2 14 57 110 167 District 3 Countywide Allocation 0 0 8 8 Total District 3 0 0 8 8 District 4 Countywide Allocation 0 0 8 8 ABC Recovery Center Village Indio 4 0 0 40 40 Episcopal Community Services Navajo Trails PS 4 0 0 34 34 Martha’s Village & Kitchen Martha’s Village Indio 4 0 84 36 120 Shelter from the Storm Shelter from PD 4 18 108 0 108 the Storm Total District 4 18 192 118 310 District 5 Countywide Allocation 0 0 8 8 US Vets Inland Empire Riv. 5 26 0 50 50 Veterans Housing Total District 5 26 0 58 58 TOTAL TRANSITIONAL HOUSING INVENTORY 98 369 354 723 B-3 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Permanent Supportive Housing, County of Riverside by District Year-Round Total Family Family Indiv. Chronic Year-Round Provider Name Facility Name City District Units Beds Beds Beds Beds Unincorporated or Countywide Inventory County Housing Authority Tenant-Based 1,2,3 0 15 23 23 38 – West County ALLOCATION A 0 5 8 8 13 County Housing Authority Tenant-Based 3,4,5 12 12 11 11 19 –East County ALLOCATION B 4 4 4 4 8 County Housing Authority Tenant-Based 1,2,3,4,5 0 0 44 44 44 S+C Countywide ALLOCATION C 0 0 9 9 9 District 1 Coachella Valley Housing Geel Place Riv. 1 0 0 42 0 42 Coalition/DMH Path of Life Ministries Riv. 1 0 0 6 6 6 Dept. of Mental Health Safe Haven (in development) Riv. 1 0 0 25 25 25 Subtotal 0 0 73 31 73 ALLOCATION A 0 5 8 8 13 ALLOCATION C 0 0 9 9 9 Total District 1 0 5 90 48 95 District 2 ALLOCATION A 0 5 8 8 13 ALLOCATION C 0 0 9 9 9 Total District 2 0 5 17 17 22 District 3 Valley Restart Stable Horizons Hemet 3 8 32 3 2 35 Subtotal 8 32 3 2 35 ALLOCATION A 0 5 8 8 13 ALLOCATION B 4 4 4 4 8 ALLOCATION C 0 0 9 9 9 Total District 3 12 41 24 19 65 District 4 Coachella Vly. HC/DMH La Hacienda 4 0 0 36 0 36 Desert AIDS Project CASAS PS 4 0 0 20 0 20 Episcopal Com. Services Desert Vista PS 4 0 0 40 40 40 Subtotal 0 0 96 40 96 ALLOCATION B 4 4 4 4 8 ALLOCATION C 0 0 9 9 9 Total District 4 4 4 109 49 113 District 5 ALLOCATION B 4 4 4 4 8 ALLOCATION C 0 0 9 9 9 Total District 5 4 4 13 9 17 TOTAL INVENTORY 20 59 250 151 305 B-4 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY C APPENDIX ACF Administration for Children and Families ACF - OFA Administration for Children and Families - Ofﬁce of Family Assistance AHP Affordable Housing Program AMI Area Media Income CARE Ryan White Comprehensive AIDS Resources Emergency (Care) Act Programs: Title I & II CCDBG/CCDF Child Care and Development Block Grant CDBG Community Development Block Grant CEQA California Environmental Quality Act CMHS BG Community Mental Health Services Block Grant CMS Centers for Medicare & Medicaid Services CofC Continuum of Care CSAT Center for Substance Abuse Treatment CSBG Community Services Block Grant DOE Department of Education DOJ Department of Justice DOJ OJP Department of Justice Ofﬁce of Justice Programs C-1 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY DOL Department of Labor DOL ETA Department of Labor Employment and Training Administration DOL SVORI Department of Labor Serious and Violent Offender Reentry Initiative ELHSI Ending Chronic Homelessness Services Initiative ESG Emergency Shelter Grants (McKinney Act) FHLB Federal Home Loan Bank FMR Fair Market Rent HACR Housing Authority of the County of Riverside HCH Health Center Grants for Homeless Populations (Health Care for the Homeless) HHS Dept of Health & Human Services HMIS Homelessness Management Information System HOME Home Investment Partnership Program HOPWA Housing Opportunities for People with AIDS HPS Historic Preservation Services HRSA Health Resources & Services Administration HTC Historic Tax Credits HUD US Dept Housing & Urban Development HVRP Homeless Veterans Reintegration Program IRS Internal Revenue Service LAHSA Los Angeles Homeless Services Agency LIHTC Low Income Housing Tax Credits MHBG, SABG SAMHSA Discretionary Grants MHSA Mental Health Services Act (Proposition 63) NEPA National Environmental Protection Act NIMBY Not in My Backyard C-2 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY NMTC New Markets Tax Credits ODEP Ofﬁce of Disability Employment Policy OPCC Ocean Park Community Center PATH Projects for Assistance in Transition From Homelessness PHA Public Housing Authority PWA Persons Living with Aids RHS Rural Housing Service Guaranteed Rural Rental Housing Program RHYC Runaway and Homeless Youth Coalition S+C Shelter Plus Care SAMHSA Substance Abuse and Mental Health Services Administration SAPTBG Substance Abuse Prevention and Treatment Block Grant Section 108 Section 108 Loan Section 202 Supportive Housing for the Elderly Section 514/516 RHS Section 514/516 Section 515 RHS Section 515 Section 521 RHS Section 521 Rental Assistance Section 538 RHS Section 538 Section 8 - PBA Section 8 Housing Choice Voucher Program Project Based Section 8 - TBA Section 8 Housing Choice Voucher Program Tenant Based Section 811 Supportive Housing for People with Disabilities SELHA Services to End Long-Term Homelessness Act SHP - ISH Supportive Housing Program - Innovative Supportive Housing SHP - TH Supportive Housing Program - Transitional Housing SHP - Perm Supportive Housing Program – Permanent Housing for Persons with Disabilities and Safe Havens Components SHP - PHPWD Supportive Housing Program - Permanent Housing for Persons with Disabilities C-3 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY SHP - SSO Supportive Housing Program - Support Services Only SHP - Trans Supportive Housing Program – Transitional Housing, Support Services Only, Innovative Supportive Housing and HMIS Components SNAPS HUD Special Needs Assistance Programs Ofﬁce SRO Single Room Occupancy SSA Social Security Administration SSBG Social Services Block Grant SSDI Social Security Disability Insurance SSI Supplemental Security Income TANF Temporary Assistance for Needy Families TAY Transitional Age Youth TCAC Tax Credit Allocation Committee TCE Grants to Expand Substance Abuse Treatment Capacity in Targeted Areas of Need (Targeted Capacity Expansion) TCE-SAP Targeted Capacity Expansion Initiatives for Substance Abuse Prevention and HIV Prevention in Minority Communities THP Development of Comprehensive Drug/Alcohol and Mental Health Treatment Systems for Persons who are Homeless (Treatment for Homeless Persons) TLP Transitional Living Program for Older Homeless Youth USDA US Dept of Agriculture USDT US Dept of Treasury VA Veteran’s Administration VAWA Violence Against Women Act VWIP Veterans’ Employment Program (Veterans’ Workforce Investment Programs) WIA Workforce Investment Act C-4 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY D APPENDIX BIBLIOGRAPHY Cities: City of Corona, dated April 2001, Amended December 2, 2004 City of Hemet, 2005-2010 Five Year Consolidated Plan and 2005-2006 Annual Action Plan City of Moreno Valley, 203-2008 Consolidated Plan City of Palm Desert, Five-Year Consolidated Plan/Community Development Block Grant FY 2003-2004 to FY 2007/2008 City of Palm Springs, 2005-2010 Five Year Consolidated Plan and 2005-2006 Annual Action Plan City of Riverside, City of Riverside 2005-1010 Consolidated Plan and Annual Action Plan 2005-2006 County of Riverside: Streamlined 5-Year Plan for Fiscal Years 2005-2010 and Streamlined Annual Plan for Fiscal Year 2006 City And County Of Riverside: “2005 Continuum of Care Plan” “2006 Continuum of Care Plan” D-1 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Federal Government: Federal Register, v. 71, No. 45, (March 8, 2004), p. 12034 Notices: HUD, “Implementing the New Freedom Initiative and Involving Persons with Disabilities in the Preparation of the Consolidated Plan through Citizen Participation,” CPD-05-03 Issued June 6, 2005 HUD, “Guidance on Combining Program Funds of the McKinney Act Programs and the HOPWA Program with the HOME Program,” CPD 01-01 Issued January 17, 2001 HUD, “Using HOME Program Funds to Address the Challenges of Homelessness,” CPD-03-08-Issued July 30, 2003 “ HUD, “Notice of Funding Availability for the Collaborative Initiative to Help End Chronic Homelessness,” Federal Register, Vol. 68, No. 17/Monday, January 27, 2003, 4019 HUD, Public and Indian Housing, “Homeless Initiative in Public Housing and Housing Choice Voucher Programs,” HUD, Notice PIH 2003-25, October 3, 2003 Publications: HUD, “Calculating Unmet Need for Homeless Individuals and Families” (Homeless Assistance Programs April 2006) HUD, “2007 Budget Summary, (Message from Secretary Jackson)” DEPARTMENT OF VETERANS AFFAIRS (VAD) VAD, “Part 61—VA Homeless Providers Grant and Per Diem Program,” VAD, CFR Parts 61, published in the Federal Register September 26, 2003 State of California: Legislative Analyst’s Ofﬁce, “Analysis of the 2006-07 Budget Bill (Education),” February 2006 DEPARTMENT OF EDUCATION (CDE): CDE, “2006-2007 Local Planning Councils’ Priorities/County Funding Priorities—General Child Care and Development Program,” Child Development Division, Revised September 8, 2006 D-2 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT (HCD): HCD, “Memorandum dated June 17, 2002 to Planning Directors and Interested Parties re ‘Housing Element Legislation Effective January 1, 2002’” HCD, Division of Housing Policy Development, California Redevelopment Agencies, “Housing Activities During Fiscal Year 2004/2005,” June 2006 HCD, “Myths and Facts About Affordable & High Density Housing, a Report,” HCD California Planning Roundtable HCD, “California’s Deepening Housing Crisis,” HCD, November 16, 2006 HCD, “California Redevelopment Agencies—Fiscal Year 2004/2005, Project Area Contributions to Low and Moderate Income Housing Fund,” May 1, 2006 DEPARTMENT OF MENTAL HEALTH (DMH): Notices: DMH, “DMH Information Notice No. 06-08 re ‘Initial Mental Health Services Act Contract’” DMH, “DMH Information Notice No. 06-02 re ‘Notiﬁcation of New Mental Health Services Act and Federal Accountability Reporting Requirements: Tracking of Services, Outcomes, Cost, and Program Oversight’” “DMH Information Notice No. 06-02 re ‘Allowable Use of Community Services and Supports Funding for Enhancement of Local Infrastructure’” Other Publications: DMH, “Vision Statement and Guiding Principles for DMH Implementation of Mental Health Services Act” (February 16, 2005) DMH, “FY 2006-2007 Governor’s Budget (Preliminary) Allocation/Statewide Allocation Summary” Department of Alcohol and Drug Programs dated May 19, 2006 DMH, “Statistics and Data Analysis,” California Health and Human Services Agency, January 2005 DMH, “Statistics and Data Analysis,” California Health and Human Services Agency, June 2006 D-3 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY DEPARTMENT OF SOCIAL SERVICES (DSS): DDS, “2006-2007 Appropriation Table,” Administration Division/Estimates Bureau. DDS, “Rights, Responsibilities and Other Important Information for the Cash Aid and Food Stamp Programs, and/or Medi-Cal/State-Run County Medical Services Program (CMSP)” from the Department of Health Services/Health and Human Services Agency DDS, “Fiscal Year 2006/2007 County Services Block Grant and Adult Protective Services General Fund Planning Allocations,” County Fiscal Letter No. 05/06-50, June 26, 2006 DDS, “Temporary Assistance for Needy Families Performance Incentives – Final Allocation for Fiscal Year 2005-06 and Planning Allocation for Fiscal Year 2006/07,” County Fiscal Letter No. 06/07-12, September 28, 2006 DDS, “Fiscal Year 2006/07 California Work Opportunity and Responsibility to Kids Program – Mental Health and Substance Abuse Allocation,” County Fiscal Letter No. 06/07-14, September 28, 2006 DDS, “Fiscal Year 2006/07 California Work Opportunity and Responsibility to Kids (CalWorks) Program Planning Allocation, County Fiscal Letter No. 06/07-11, July 28, 2006 DSS, “Detail Tables/Cost Comparisons,” Administration Division, Estimates and Research Services Branch, Financial Management & Contract Branch, November 2006 Subvention DSS, “Title XX Block Brant Post-Expenditure Report July 1, 2003 through June 2004,” Health and Human Services Agency Other Publications: Beatty, David F., et al., Redevelopment in California, McDonough, Holland & Allen, Solano Press Books, Third Edition, 2004 BUILDING CHILD CARE PROJECT (BCC), “Potential Resources for Child Care Facilities Development in California,” BCC (a California Statewide Collaborative), May 2006 CENTER FOR LAW AND SOCIAL POLICY (CLASP), “Child Care and Development Block Grant Participation in 2005,” September 7, 2006 CORPORATION FOR SUPPORTIVE HOUSING (CSH), “Mental Health Services Act— Housing Toolkit,” CSH, November 2005 (funded by DMH) Gans, Herbert J., The War Against the Poor—The Underclass and Antipoverty Policy, Basic Books, 1995 D-4 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Institute for Urban Research and Development (IURD), County of Riverside: County of Riverside 2004/2005 Homeless Assessment, 2005 MARTHA’S VILLAGE & KITCHEN, “2006 Program Summary;” “January 27, 2006 Mission Statement;” and “Village News” (Winter 2005) Porterﬁeld, David, “Planning, Designing, Siting and Financing Safe Haven Housing (Chapter 2), Wisconsin Partnership for Housing Development, Inc., Madison, Wisconsin. Raubeson, Andy, “Case Study of the Marshal House, a Transitional Housing Facility for Recovering Substance Abusers,” Andy Raubeson, Presented at the 4th Annual Members Conference National Alliance to End Homelessness, Washington, D.C., June 21, 1996 Rawson, Mike, “Laws Prohibiting Discrimination Against Affordable Housing & Its Residents,” Public Interest Law Center Sherwood, Kay E., Connecticut Supportive Housing Demonstration Program Evaluation Report, University of Pennsylvania Health System, Department of Psychiatry, 1999 SOUTHERN CALIFORNIA ASSOCIATION OF GOVERNMENTS (SCAG), “Draft Regional Housing Need Allocation Plan,” (Planning Period 1/1/2006-6/30/2014), SCAG County Of Riverside: County of Riverside, “Demographics/Progress Report,” County of Riverside, http://www. rct\ma.org/tcd/introduction.html County of Riverside Department of Public Health, 2005 Communicable Disease Report, County of Riverside, http://www.rivcohealthdata.org/downloads/reports/CommDisease/cdr_ 05.pdf Federal Government: HEALTH AND HUMAN SERVICES: HHS, “Overview of the Child Care and Development Fund (Fiscal Years 2006-2007) (October 2006),” HHS, http://www.acf.hhs.gov/programs/ccb HHS, Administration for Children & Families/Family and Youth Services Bureau(FYSB), “Fact Sheet,” HHS, http://www.acf.hhs.gov/opa/fact_sheet/fysb_printable.html D-5 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY HHS, Home Page for Ofﬁce of the Assistant Secretary for Planning and Evaluation- Homelessness, HHS, http://www.aspe.hhs.gov/homeless/index.shtml HHS, “HHS Awards $579.7 Million for HIV/AIDS Care,” News Release dated March 14, 2006, HHS, http://www.hhs.gov/news/press/2006pres/20060314.html SAMSH:A SAMSHA, “SAMHSA Grant Awards by State FY 2005,” SAMHSA www.samhsa.gov/ Grants/2006/fy2006awards.aspx SAMSHA, “Projects for Assistance in Transition from Homelessness-California,” SAMSHA, www.pathprogram.samsha.gov/pdf/2005-Proﬁles/ca.pdf HOUSING AND URBAN DEVELOPMENT: HUD, “AMI’s,” HUD, http://www.efanniemae.com/sf/refmaterials/hudmedinc/ HUD, “Statewide HOPWA Information – California,” HUD, http://www.hud.gov/ofﬁces/ cpd/aidshousing/local/ca HUD, “Housing Opportunities for Persons with Aids (HOPWA Program,” HUD, http:// www.hud.gov/ofﬁces/cpd/aidshousing/programs HUD, “HUD’s Public Housing Program,” HUD, http://www.hud.gov/renting/phprog.cfm HUD, “HOME Investment Partnership Program,” HUD, http://www.hud.gov/ofﬁces/cpd/ affordablehousing/programs/home/index.cfm HUD, “Final FY 2006 Fair Market Rent Documentation System,” HUD, http://www.huduser. org/datasets/fmr/fmrs/2006summary U.S. SOCIAL SECURITY ADMINISTRATION (SSA): SSA, “SSI Recipients by State and County, 2005,” SSA, Ofﬁce of Policy, http://www.ssa.gov/ policy/docs/statecomps/ssi_sc/2005/ca.html State of California: DEPARTMENT OF EDUCATION (CDE) CDE, “Funding Results: Education for Homeless Children and Youth,” CDE, www.cde.ca.gov/ fg/fo/r16/homeless06result.asp D-6 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT: HCD, “HCD’s Loans, Grants and Enterprise Zone Programs (Funds Available Calendar),” HCD, http://www.hcd.ca.gov/fa HCD, “Financial Assistance Programs—Annual Report—FY 2005-2006,” December 2006, HCD, http://www.hcd.ca.gov/fa/Annual Report _FY05-06.pdf HCD,“Housing Policy Development,” HCD, http://www.hcd.ca.gov/hpd/hrc/plan/he/sb520_ hpd.pdf HCD, “NIMBY Resources,” HCD, http://www.hcd.ca.gov/hpd/nimby.htm HCD, “Emergency Housing and Assistance Program (EHAP), Funding Round 14, Fiscal Year 2006/2007, Statewide Notice of Funding Availability for Operating Facility Grants,” September 22, 2006 HCD, “Awards and Projected Production by County, Fiscal Year 2005-2006,” HCD. DEPARTMENT OF MENTAL HEALTH (DMH): DMH,“Olmstead/New Freedom Initiative,” DMH, http://www.dmh.ca.gov/AOAPP/ Olmstead/default.asp DMH, “AB 2034 Program Allocations,” DMH, http://www.dmh.cahwnet.gov/AOAPP/Int_ Services/docs/03-04 Other Websites: Institute for Community Economics, “California Redevelopment Law,” Institute for Community Economics, www.people.cornell.edu/pages/rjp17/SharedEquityHome.pdf FEDERAL HOME LOAN BANK (FHLB), “Affordable Housing Program and Community Investment Program,” FHLB, http://www.fhlbanks.com/html/programs.html NATIONAL LOW INCOME HOUSING COALITION (NLIHC), “Out of Reach,” NLIHC, http://www.nlihc.org/oor/index.cfm OXFORD HOUSE, “Oxford House: Housing, Fellowship, Self-Reliance, Self-Respect for Recovering Individuals,” Oxford House, http://www.oxfordhouse.org/leases.html D-7 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY E APPENDIX Claudia Castorena Division Director/Co-Founder Martha’s Village & Kitchen 83791 Date Ave. Indio, CA 92201-4737 Gary M. Christmas Deputy County Executive Ofﬁcer Executive Ofﬁce Leticia DeLara Legal Assistant Board of Supervisors, 4th District County of Riverside 4080 Lemon St., 5th Floor Riverside, CA 92501 Carrie Harmon Department of Public Social Services County of Riverside 4060 County Circle Drive Riverside, CA 92503 Opal Hellweg Legislative Team Member Board of Supervisors, 3rd District 4080 Lemon St., 5th Floor Riverside, CA 92501 E-1 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Cynthia Hinckley, Ph.D. Director Department of Public Social Services County of Riverside 4060 County Circle Drive Riverside, CA 92503 Jaime Hurtado Legislative Assistant to Supervisor Marion Ashley Board of Supervisors, 5th District County of Riverside 4080 Lemon St., 5th Floor Riverside, CA 92501 Wendy Kolk Legislative Assistant Board of Supervisors, 1st District County of Riverside 4080 Lemon St., 5th Floor Riverside, CA 92501 Susan K. Low Assistant Director, Administrative Services Department of Public Social Services County of Riverside 4060 County Circle Drive Riverside, CA 92503 Heidi M. Marshall Deputy Director Economic Development Agency 5555 Arlington Ave. Riverside, CA 92504-2506 E-2 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Maria Marquez, M.F.T. Mental Health Services Manager Department of Mental Health County of Riverside 769 Blaine St., Suite B Riverside, CA 92507 Emilio Ramirez Economic Development Agency County of Riverside 5555 Arlington Ave. Riverside, CA 92504-2508 Robin Reid Legislative Team Member Board of Supervisors, 3rd District 4080 Lemon St., 5th Floor Riverside, CA 92501 Anne Stephens Senior Legislative Assistant Board of Supervisors, 2nd District County of Riverside 4080 Lemon St., 5th Floor Riverside, CA 92501 Ronald A. Stewart, Ph.D. Interim Administrative Manager Homeless Programs Department of Public Social Services 4060 County Circle Drive Riverside, CA 92503 E-3 DESTINATION HOME: A STRATEGIC GUIDE TO THE DEVELOPMENT OF HOMELESS HOUSING IN RIVERSIDE COUNTY Jeff Stone Supervisor, Third District Board of Supervisors County of Riverside 4080 Lemon Street, 5th Floor Riverside, CA 92501 Lori Stone Legislative Team Member Board of Supervisors, 3rd District County of Riverside 4080 Lemon St., 5th Floor Riverside, CA 92501 David L. Terrell Administrative Manager Department of Public Social Services County of Riverside P. O. Box 7789 Riverside, CA 92507 Jerry Wengerd, L.C.S.W. Director Department of Mental Health County of Riverside 4095 County Circle Drive Riverside, CA 92503-7549 Robin Zimpfer Assistant County Executive Ofﬁcer Economic Development Agency P. O. Box 1180 Riverside, CA 92502 E-4
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