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mortgages, while SHIP loans are generally structured as soft second mortgages. Since SHIP is a state funded program,the SHIP program fiscal year(FY)is concurrent with the state fiscal year and runs from July 1 to June 30. Because SHIP funds provided in one fiscal year can be spent over a three fiscal year period,the county often has two or more years of SHIP funding active. For example,in the past year the county has expended funds from the following SHIP program fiscal years: FY 12/13, FY 13/14, and FY 14/15. For each fiscal year (FY), SHIP funds consist of state allocations and program income. Program income consists of SHIP loan repayments and interest earned. Attachment#1 shows historic SHIP fund information. That includes the number of loans provided to eligible applicants by fiscal year and by income category. According to SHIP Program requirements,by September 15 of each year,the county must submit an annual report for each fiscal year for which SHIP funds were expended. Those reports must be signed by the Chairman of the Board of County Commissioners or his designee. For all previous fiscal years, closeout reports were previously submitted to and approved by the state. 2015 annual reports are also submitted by the September 15"' deadline and approved by the state. For state FY 2013-14 funding, legislators provided a shorter than normal expenditure deadline. For that fiscal year, all funds must have been expended by the end of September 2015. The county complied with that deadline. Attached to this staff report is the county's SHIP Program FY 2013-2014 annual report/closeout report (see attachment 2). That annual report must be submitted to the state by October 31, 2015. i i I ANALYSIS According to state regulations, SHIP funds must be utilized in such a manner that all state requirements and all requirements of the county's Local Housing Assistance Program are met. Among the State Housing Initiatives Partnership Program (SHIP) requirements are the following: • At least 30% of funds must be utilized by very low income (VLI) households • At least 30% of funds must be utilized by low income (LI) households j • At least 65% of funds must be utilized for homeownership • At least 75% of funds must be utilized for construction, rehabilitation or emergency repair Not more than 10% of funds may be utilized for administration costs In administering the SHIP program,the county has met all of those requirements as well as all local requirements for homeownership, credit, employment, assets, and others. i As part of the 2015 SHIP annual report review, a copy of the attached annual report has been distributed to members of the county's Affordable Housing Advisory Committee, Affordable Housing Partnership Group, municipalities, and other interested persons for their review and comment. Also,a notice of the availability of the report was posted on the county website. To date, staff has received no comments. 2 29