Loading...
Item J1 BOARD OF COUNTY COMMISSIONERS AGENDA ITEM SUMMARY Meeting Date: August 19,2009 Division: Monroe County Housing Authority Bulk Item: Yes --1L No Department: MC SHIP Program Staff Contact Person/Phone #: Marie Brouillette, 292-5621 x 252 AGENDA ITEM WORDING: A RESOLUTION OF THE BOARD OF COUNTY COMMISSIONERS OF MONROE COUNTY, FLORlDA APPROVING AN AMENDMENT TO THE 2008/2009/2010 LOCAL HOUSING ASSISTANCE PLAN AS REQUIRED BY THE STATE HOUSING INITIATIVES PARTNERSHIP (SHIP) PROGRAM, AUTHORIZING THE ADOPTION OF THE "FLORIDA HOMEBUYER OPPORTUNITY PROGRAM" (FHOP) STRATEGY AND THE SUBMISSION OF THE AMENDED LOCAL HOUSING ASSISTANCE PLAN TO THE FLORIDA HOUSING FINANCE CORPORATION. ITEM BACKGROUND: Section 47. 2009-2010 General Appropriations Act, Specific Appropriation 1570 - 2009-2010 SHIP Distributions will be utilized to fund the "Florida Homebuyer Opportunity Program", The intent of the Legislature is to ensure that the residents of the state derive the maximum possible economic benefit from the federal first-time homebuyer tax credit created through the American Recovery and Reinvestment Act of 2009. PREVIOUS RELEVANT BOCC ACTION: nJa CONTRACT/AGREEMENT CHANGES: Amendment ofthe 2008-2009-2010 Monroe County Local Housing Assistance Plan by adopting the Florida Homebuyer Opportunity Program Strategy. STAFF RECOMMENDATIONS: Approval. TOT AL COST: 0.00 INDIRECT COST: BUDGETED: Yes _No COST TO COUNTY: 0.00 SOURCE OF FUNDS:2009-20l 0 SHIP Distribution REVENUE PRODUCING: Yes~o AMOUNT PER MONTH_ Year APPROVED BY: County Attytt OMBlPurchasing _ Risk Management _ DOCUMENT A TION: Included X Not Required_ DISPOSITION: AGENDA ITEM # Revised 1/09 RESOLUTION NO. , 2009 A RESOLUTION OF THE BOARD OF COUNTY COMMISSIONERS OF MONROE COUNTY, FLORIDA APPROVING AN AMENDMENT TO THE 2008/2009/2010 LOCAL HOUSING ASSISTANCE PLAN AS REQUIRED BY THE STATE HOUSING INITIATIVES PARTNERSHIP (SHIP) PROGRAM, AUTHORIZING THE ADOPTION OF THE "FLORIDA HOMEBUYER OPPORTUNITY PROGRAM" (FHOP) STRATEGY AND THE SUBMISSION OF THE AMENDED LOCAL HOUSING ASSISTANCE PLAN TO THE FLORIDA HOUSING FINANCE CORPORATION, WHEREAS, the State Housing Initiatives Partnership (SHIP) Act, ss. 420.907-420.9079, Florida Statutes (1992), and Rule Chapter 67-37, Florida Administrative Code, required local governments to develop a Local Housing Assistance Plan (LHAP) outlining how SHIP funds will be used; and WHEREAS, The Monroe County Housing Authority prepared a 2008/2009/2010 Local Housing Assistance Plan which was approved by the Monroe County Board of County Commissioners and the Florida Housing Finance Corporation; and WHEREAS, the Florida Housing Finance Corporation has been charged to implement Specific Appropriation 1570 of the 2009-2010 General Appropriations Act; and WHEREAS, the state program shall be called the "Florida Homebuyer Opportunity Program" (FHOP); and WHEREAS, the Florida Homebuyer Opportunity Program Strategy is designed in response to the legislative proviso requiring SHIP local governments to expend 2009-2010 funds to ensure that residents of the state derive the maximum possible economic benefit from the federal First-time Homebuyer Tax Credit created through The American Recovery and Reinvestment Act of 2009 by providing subordinate down payment assistance loans to first time homebuyers for owner- occupied primary residences which can be repaid by the income tax refund the homebuyer is entitled to under the First Time Homebuyer Credit; and WHEREAS, the Florida Housing Finance Corporation is responsible for administering the Florida Homebuyer Opportunity Program to optimize eligibility for conventional, VA, USA, FHA and other loan programs through the State Housing Initiatives Partnership (SHIP) program; and WHEREAS, up to ten percent (10%) of funds received may be used for administrative expenses to implement the FHOP and not more than .25 percent (.25%) may be used to compensate the Florida Housing Finance Corporation for the expenses associated with compliance monitoring; and WHEREAS, prior to December 1, 2009 or any later date established by the Internal Revenue Service, counties receiving funds shall expend the funds appropriated under Specific Appropriation 1570A only, to provide subordinate loans to perspective first-time homebuyers under the FHOP, The funds appropriated under Specific Appropriation 1570A may not be used for any other program currently existing under ss. 420.907-420.9079, Florida Statutes. Thereafter, the funds shall be expended in accordance with ss. 420.907-420.9079, Florida Statutes. NOW, THEREFORE, BE IT RESOLVED, by the Board of County Commissioners of Monroe County Florida, that the County hereby: Authorizes the amendment to the 2008/2009/20]0 Monroe County Local Housing Assistance Plan to incorporate the "Florida Homebuyer Opportunity Program" (FHOP) Strategy. PASSED AND ADOPTED by the Board of County Commissioners of Monroe County, Florida at a regular meeting of said Board held on the 19th day of August, 2009. Mayor George Neugent Mayor Pro Tern Sylvia Murphy Commissioner Mario DiGennaro Commissioner Kim Wigington Commissioner Heather Carruthers (SEAL) A TrEST: DANNY L. KOLHAGE, Clerk BOARD OF COUNTY COMMISSIONER OF MONROE COUNTY, FLORIDA By: By: Deputy Clerk Mayor George Neugent Approved as to legal sufficiency: 7t"CJC e0UNTY r,TOR~' E,Y ~,rJ, ~ROI4ED AS p~f)''''j . ~ . f "'--f'-<'..I - PEDRO J. ~ EHCADO "" 1 / " ASSISTANT CO TY ATTORNEY 1S) 3/0 T i Date Date: EXHIBIT A Resolution , 2009 D, Name of the Strategy: Florida Homebuyer Opportunity Program (FHOP) a. Summary of the Strategy: This strategy is designed in response to the legislative proviso requiring SHIP local governments to expend 2009-20 10 funds to ensure that residents of the state derive the maximum possible economic benefit from the federal first time homebuyer tax credit created through The American Recovery and Reinvestment Act of2009 by providing subordinate down payment assistance loans to first time homebuyers for owner occupied primary residences that can be repaid by the income tax refund the homebuyer is entitled to under the First time Homebuyer Credit. The state program shall be called the "Florida Homebuyer Opportunity Program" (FHOP). b, Fiscal Years Covered: 2009/2010 or until expiration ofthe federal first-time homebuyer tax credit. c. Income Categories to be Served: Up to $75,000 for single taxpayers or $150,000 for joint filers. There is no requirement to reserve 30 percent of the funds for awards to very-Iow- income persons or 30 percent of the funds for awards to low-income persons; and there is no requirement to expend 75% of funds for construction, rehabilitation or emergency repair. d, Maximum Award: Maximum award is the principal balance of the loans provided shall not exceed 10% of the purchase price or $8,000 whichever is less. e. Terms, Recapture and Default: Mortgage loans will be forgiven ifthe loan is repaid within 18 months from the date of closing. The homebuyer(s) shall be expected to use their federal income tax refund to fully repay the loan. If the county receives repayment from the homebuyer(s) within 18 months after the closing date of the loan, the county shall waive all interest charges and fees, A home buyer who fails to fully repay the loan within 18 months of the date of closing, shall be subject to monthly repayments ofthe outstanding debt amortized over 60 months at 6% per annum. Loans repaid during the period when there is still an active homebuyer tax credit program must be used to help more FHOP buyers. Once the tax credit program ceases to exist, all funds repaid to the county shall be considered "program income" as defined in s. 420.9071 (24) and can be utilized on any SHIP strategy. f. Recipient Selection Criteria: Recipients must meet the requirements of the following; the maximum income limit shall be Adjusted Gross Income of $75,000 for single taxpayer households or $150,000 for joint-filing taxpayer households which is equal to that permitted by the American Recovery and Reinvestment Act of 2009. .. MONROE COUNTY HOUSING AUTHORITY To: Leslie Warren Darlene Raker Florida Housing Finance Corporation From: Marie Brouillette Monroe County SHIP Date: July 29, 2009 Re: Florida Homebuyer Opportunity Program (FHOP) Strategy Leslie/Darlene: Attached please find the proposed FHOP Strategy for Monroe County. Would you please review and approve prior to my submitting to the Monroe County Board of County Commissioners for their final approval at their regular meeting scheduled for August 19, 2009. Thank you. Marie LHAP HOUSING STRATEGY For 2009-2010 NOTE: This is a generic strategy that can be used by all local governments. It has been pre-approved by the SHIP review committee. If you make revisions to this strategy which are beyond technical in nature, it must be submitted to FHFC for approval. Name of the Strategy: Florida Homebuycr Opportunity Program a. Summary of the Strategy: This strategy is designed in response to the legislative proviso requiring SHIP local governments to expend 2009- 2010 funds to ensure that residents of the state derive the maximum possible economic benefit from the federal first time homebuyer tax credit created through The American Recovery and Reinvestment Act of 2009 by providing subordinate down payment assistance loans to first time homebuyers for owner occupied primary residences that can be repaid by the income tax refund the homebuyer is entitled to under the First Time Homebuyer Credit. The state program shall be called the "Florida Homebuyer Opportunity Program." b. Fiscal Years Covered: 2009/2010 until expiration of the Florida Homebuyer Opportunity Program Tax Credit. c. Income Categories to be served: Up to $75,000 for single taxpayers or $150,000 for joint filers. There is no requirement to reserve 30 percent of the funds for awards to very-law-income persons or 30 percent of the funds for awards to low-income persons; and there is no requirement to expend 75% of funds for construction, rehabilitation or emergency repair. d. Maximum award is the principal balance of the loans provided shall not exceed 10% ofthe purchase price or $8,000 whichever is less. e. Terms, Recapture and Default: If the county or eligible municipality receives repayment from the homebuyer within 18 months after the closing date of the loan the county or eligible municipality shall waive all interest charges. A homebuyer who fails to fully repay the loan within 18 months shall be subject to repayment terms provided in an appropriate strategy in the local housing assistance plan. All funds repaid to a county or eligible municipality shall be considered "program income" as defined in s. 420.9071 (24). f. Recipient Selection Criteria: Recipients must meet the requirements of the following: The maximum income limit shall be Adjusted Gross Income of $75,000 for single taxpayer households or $150,000 for joint-filing taxpayer households which is equal to that permitted by the American Recovery and Reinvestment Act of 2009 ng Initiatives Partnership Program (SHIP) Technical Bulletin 2009-01 Florida Homebuyer Opportunity Program regular legislative session, the Florida Homebuyer Opportunity Program was ($30 million statewide) is detailed in the budget implementing bill (see program, which will be distributed through and operated under the SHIP that the funding be used to provide up to $8,000 in purchase assistance to are eligible to receive the federal first-time homebuyer tax credit created American Recovery and Reinvestment Act of 2009. The assistance shall be be the Applicant when they receive their federal tax refund. This will be use funds as long as the homebuyer tax credit is available. The , available after July 1, 2009 pending the bill being signed by the Governor Documentary Stamp Collections. will be implemented under a new strategy to be adopted within the local plan (LHAP). Florida Housing (FHFC) is providing a generic strategy use. This strategy is pre-approved by Florida Housing's SHIP Review no further action with FHFC if adopted as is. If you make changes to submit the changes for review and approval. to the SHIP statute and/or rule that apply to this program income limit shall be Adjusted Gross Income of $75,000 for single taxpayer or $150,000 for joint-filing taxpayer households. to reserve 30 percent of the funds for awards to very-low-income percent of the funds for awards to low-income persons; and no requirement to expend 75% of funds for construction, rehabilitation or repair. FI +d4u · orl a nOUslng f 1 nl1':~' C' -r) I p "r r "'-] i t~~' we make housing affordcble This e-mail is intended as a follow up to previous information provided regarding the Florida Homebuyer Opportunity Program (FHOP). In the 2009 legislative session, $30 million was allocated to the FHOP program (see attached technical bulletin for a summary). In order to allow for the funds to be expended expediently, it was determined that SHIP was the best delivery system. The FHOP program requires that the funding allocated to local governments be expended for recipients who qualify for a federal first time homebuyer tax credit up to $8,000 (please see the attached legislation detailing the requirements). The legislation requires that each SHIP jurisdiction amend their LHAP to include a strategy for the FHOP (see sample strategy attached). You should already have begun this process--there will he no rulemaking regarding this particular program. There will be a follow up public meeting via telephone on July 7th at 10 AM (see attached notice), but in the meantime, if you have questions, please call us as time is of the essence, The following is a Q&A regarding the FHOP funding: . Will there be rulemaking for FHOP? No, Although there will be rulemakingfor SHIP this year, those changes are being made to incorporate program changes made in SB 360. There will be no rule for FHOP, FHOP must adhere to all SHIP rules and regulations except where noted in the legislation. . How will funds be allocated? Funds will be allocated according to the SHIP statute (420.9073, FS). . What sources of money may we leverage with FHOP to assist a homebuyer? There are no restrictions on leveraging other funds, For SHIP funds, you could leverage unexpendedfundsfrom previous year's allocations or program income. . Can a mobile home be purchased? The SHIP rule still applies related to 'Eligible Housing", However, since the passage and signing ofSB 360, manufactured housing that meets certain criteria are eligible under SHIP, This change will be included in the rule during the rulemaking process. . When we look at the buyer's income to determine eligibility, should we look at the 2008 income or the 2009 income? Look at their 2008 income tax return AND also determine that their income is also below $150,OOOfor 2009 when they buy their house. . Will we have to change how we document income? FHOP requires documentation of the income of tax payers. And yet it is possible for a household to have more than one tax payer filing separately. FHOP follows SHIP rules, and the SHIP program requires us to estimate income for the next 12 months, . Are we documenting income based on just the tax return they provide OR do we have to do our traditional third party verifications? You must do third party verifications, You may have to do two income calculations. 1) Determine if they're eligiblefor the Tax Credit and 2) Determine if they're SHIP income eligible, . In our LHAP, can we establish an Income Max BELOW $150,000 per family? Eligibility must remain set at $150,000. However, there is no prohibition from setting a priority for first serving applicants with lower incomes before serving higher income applicants. . Do we know for certain that we will receive our FHOP funding on July 1 ? There is no certainty that there will be enough collections into the State Housing Trust Fund by July 1 to cover the FHap. . Do we have to advertize 30 days in advance of taking FHOP applications? Yes, . If we allow FHOP repayment tbrough installment payments, will this overly tax our staff? It may and you still are limited to no more than a 10% admin budget. Does FHOP bave a separate Education requirement for buyers? There is nothing required in this Legislation, but the first mortgage provider often has some minimum requirement, If the local government requires homeownership counseling, it is legible just as in SHIP. . Can you explain what you bave referred to about 36 months? The legislation States: (6) Irthe county or eligible municivality receives revavment from the homebuver within 18 months after the closing date orthe loan the county or eligible municivalitv shall waive all interest charJ[es, A homebuver who rails to fullv repav the loan within 18 months shall be subiect to revavment terms vrovided in the local housing assistance vlan. Therefore, ajurisdiction may explain in its LHAP that it is setting a repayment plan which requires repayment starting 36 mo'nths after home purchase, in order to avoid negatively affecting FHA's debt ratio calculations. The LHAP must clear state that the recapture terms will be recorded as a lien against the property. in addition, FHA's j\Iortgagee Leiter 2009-15 states that a balloon payment cannot be required. . Could we limit our assistance ONLY to those who will agree to amend their 2008 taxes, so we can get repaid quickly? This may be helpful to ensure the fUnds are expended in a timely manner, . If a City or County arranges for some staff activities (like borne inspection) to be paid with program dollars-rather than admin budget funds-then will FHFC allow the award to a homebuyer to be a little more tban $8000? The FHap legislation indicates the principle balance of the down payment loan cannot be more than $8000 or 10% of the house price. Therefore, it seems you can charge fees, so long as the recapture policy does not include repayment of these fees, just the $8000 award. Consider also that this fee might be considered usury fees, . Do our SHIP maximum purchase price limits apply to FHOP? Yes. . When FHOP is repaid as Program Income, can we use this for any SHIP strategy? If you are repaid during the period when there is still an active homebuyer tax credit program, then it MUST be used to help more FHap buyers. After this tax credit ceases, then the program income can be spent on any SHIP strategy, . Will the FHOP money go into our Local Housing Trust Fund OR do we need to place it in a separate account? Funds should be deposited in the Trust Fund. . For those who have just turned in a new LHAP, do we have to amend our LHAP to zero fund the 09110 housing delivery goals chart? No, but you will have to add a FHOP strategy. . Can we combine 08/09 SHIP funds with FHOP to help a homebuyer? Yes, but consider the logistics: you will have two subordinate mortgages with different terms, You can have one mortgage with different terms for different amounts of money. Example: "$8000 is due when you get your tax credit, and $20,000 is a deferred payment loan." Get help from your legal counsel. Consider a big concern: combined loan to value. . Will the FHOP money go into our Local Housing Trust Fund OR do we need to place it in a separate account? The funds should be deposited in the Trust Fund. Section 47. In order to implement Specific Appropriation 1570 of the 2009-2010 General Appropriations Act: (1) The intent of the LeQislature is to ensure that residents of the state derive the maximum possible economic benefit from the federal first-time homebuyer tax credit created through The American Recovery and Reinvestment Act of 2009 by providinQ subordinate down payment assistance loans to first time homebuyers for owner- occupied primary residences which can be repaid by the income tax refund the homebuver is entitled to under the First Time Homebuyer Credit. The state prOQram shall be called the "Florida Homebuver Opportunity ProQram." (2) The Florida HousinQ Finance Corporation shall administer the Florida Homebuyer Opportunity ProQram to optimize eligibility for conventional, VA, USDA, FHA. and other loan prOQrams throuQh the State HousinQ Initiatives Partnership program in accordance with ss, 420.907-420.9079, Florida Statutes, and the provisions of this section. (3) Prior to December 1, 2009, or any later date established by the Internal Revenue Service for such purchases, counties and eliQible municipalities receiving funds shall expend the funds appropriated under Specific Appropriation 1570A onlv to provide subordinate loans to prospective first-time homebuyers under the Florida Homebuver Opportunity ProQram. pursuant to this section, except that up to 10 percent of such funds may be used to cover administrative expenses of the counties and eliQible municipalities to implement the Florida Homebuyer Opportunity Program, and not more than .25 percent may be used to compensate the Florida Housing Finance Corporation for the expenses associated with compliance monitorinQ, The funds appropriated under Specific Appropriation 1570A may not be used for any other proqram currently existinq under ss. 420.907- 420.9079, Florida Statutes. Thereafter, the funds shall be 1170 expended in accordance with ss. 420.907-420.9079, Florida Statutes. (4) Notwithstanding s, 420.9075, Florida Statutes, for purposes of the Florida Homebuyer Opportunity Proqram, the followinq exceptions shall apply: (a) The maximum income limit shall be an adiusted qross income of $75,000 for sinqle taxpayer households or $150,000 for ioint-filing taxpayer households, which is equal to that permitted by the American Recovery and Reinvestment Act of 2009; (b) There is no requirement to reserve 30 percent of the funds for awards to very-low- income persons or 30 percent of the funds for awards to low-income persons; (c) There is no requirement to expend 75 percent of funds for construction, rehabilitation, or emergency repair; and (d) The principal balance of the loans provided may not exceed 10 percent of the purchase price or $8,000. whichever is less. (5) Funds shall be expended under a newly created strateqy in the local housinq assistance plan to implement the Florida Homebuyer Opportunity Proqram. (6) The homebuyer shall be expected to use their federal income tax refund to fully repay the loan. If the county or eligible municipality receives repayment from the homebuyer within 18 months after the c10sinq date of the loan, the county or eliqible municipalitv shall waive all interest charqes. A homebuyer who fails to fully repay the loan within the earlier of 18 months or 10 days after the receipt of their federal income tax refund, shall be subiect to repayment terms provided in the local housinq assistance plan, includinq penalties for not usinq his or her refund for repayment. Penalties may not exceed 10 percent of the loan amount and shall be included in the loan aq reement with the homebuver. (7) All funds repaid to a county or eliqible municipalitv shall be considered "proqram income" as defined in s.420.9071 (24), Florida Statutes. (8) In order to maximize the effect of the funding, the counties and eliqible municipalities are encouraqed to work with private lenders to provide additional funds to support the initiative, However, in all instances, the counties and eliqible municipalities shall make and hold the subordinate loan. (9) This section expires JulV 1, 2010.