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Bankruptcies have been fully discharged for at least one year with no negative credit history. If there are any disputed chargeoffs, judgments, or repossessions, the applicant must submit a written reason(s) for the dispute, and Habitat for Humanity as a first lender must provide a written document to the county that states that Habitat for Humanity believes that the dispute is justifiable and it stands ready to make the first loan. Community Development Block Grant In August 1996, Indian River County's Community Development Block Grant (CDBG) application was approved by the State Department of Community Affairs. Thepurposeof the grant is to provide for street and drainage improvements, water line extensions, and water connections to the Colored School and Whitfield subdivisions in the Wabasso area. To assist very low and low income households of both subdivisions with the cost of connecting to the county water system, the county pledged $200,000 of SHIP funds as part of the CDBG application. By pledging county SHIP funds, the county acquired more points, and the CDBG application was approved. The cost of the street and drainage improvements, the water line extensions, and the water connections in the Whitfield and Colored School subdivisions are being paid using CDBG funds totaling $750,000. Without the CDBG funds, the cost of the infrastructure improvements would fall on the residents that benefit from the improvements. Although CDBG funds will pay for all of the improvements listed above, there are some costs associated with connecting to county water that cannot be paid with CDBG funds. These include impact fees, and any required plumbing improvement costs. These costs, however, can be paid with county SHIP funds for qualifying -families. Per CDBG requirements, all residents must connect to county water to be considered benefiting recipients. According to the county's Local Housing Assistance Plan, applicants for rehabilitation and impact fee loans will be deemed to have satisfactory credit if the applicable credit report shows that there are no active chargeoffs or judgments against the applicant. With CDBG assisted applicants, there is a concern that some residents in the target area may not meet the county's credit requirements. If that is the case and target area residents have insufficient funds to connect to the water system, the county's CDBG grant may be jeopardized. To connect to the county water system, an impact fee of $1,300 is required. In some cases a rehabilitation loan to repair plumbing facilities may be needed. Where required, rehabilitation loans should not exceed $200. For eligible households, these costs can be paid by SHIP loans. Although credit requirements may make some target area residents ineligible for SHIP loans, staff feels that the county's interest will be secured by a lien on the household's real property that is recorded with the SHIP loans. Since reducing credit requirements for CDBG assisted applicants will ensure that CDBG requirements will be met, staff feels that it would be appropriate to waive SHIP credit requirements for CDBG assisted SHIP applicants. On May 8,1997, the Affordable Housing Advisory Committee (AHAC) reviewed these special credit requirements for Habitat for Humanity and Community Development Block Grant (CDBG) assisted SHIP loans and recommended that the Board of County Commissioners approve these special credit requirements as proposed The Affordable Housing Advisory Committee (AHAC) and staff recommend that the Board of County Commissioners approve the proposed special credit requirements for Habitat for Humanity assisted SHIP loans. Also, AHAC and staff recommend that the Board of County Commissioners waive the local housing assistance plan credit requirements for CDBG assisted applicants only. MAY 20, 1997 77 1