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Although each of the three set aside recipients had applied for a SHIP set aside with an acknowledgement that the SHIP funds would be used in a manner consistent with current SHIP (Local Housing Assistance�-Plan) requirements, the Indian River County Homeless Services Council recently indicated that it needs to use the SHIP set aside funds in a manner that is not consistent with the provisions of the county's Local Housing Assistance Plan. Consequently, the Homeless Services Council has requested that the county revise its LHAPlan. As submitted, the Homeless Services Council's SHIP funds set aside application indicated that the SHIP funds would be used to provide downpayment/closing cost and/or rehabilitation assistance to homeless persons who graduate from the council's transitional housing program. When the set aside request was made, Homeless Services Council staff stated that funds used in that manner would constitute an acceptable match for a HUD grant submitted by the council. Recently, the Homeless Services Council determined that SHIP downpayment/closing cost/ rehabilitation loans to homeless graduates will not be acceptable to HUD as a grant match. Instead, Council staff has indicated that the SHIP funds may serve as a HUD grant match only if the funds are used for rehabilitation of the Council's homeless facility (a multi -family, rental facility) and only if the funds are provided as a grant not a loan. Consequently, the Homeless Service Council is now requesting that the Board of County Commissioners revise the county's Local Housing Assistance Plan to allow up to $100,000 of SHIP funds to be used by non-profit organizations for rehabilitation of multi -family facilities. The Council also requests that the LHAPIan be revised to provide multi -family rental rehab funds to non-profit organizations as grants instead of loans. ANALYSIS One of the goals of the county's local housing assistance plan is to increase home ownership for very low and low income households. In the past, the Board of County Commissioners has set aside SHIP funds to match CDBG funds, HOME funds, Habitat for Humanity funds and Homeless Council funds (HUD Transitional Housing Funds), with the requirement that these set aside funds be used consistent with SHIP program rules and regulations. As proposed, the Homeless Services Council's LHAP revisions are consistent with the state's SHIP program requirements and the county's overall SHIP program objectives. If approved, these revisions will ensure that housing assistance will be provided to very low income households and that the funds will be used for construction activities. With this revision, the principal change will be a modification of the County's policy to target SHIP funds for ownership, rather than rental, purposes. Revisions to the plan are shown on pages 27-31 of the plan (copy attached). Deletions are shown as r'Fdek thfu and additions are shown as underlined. If the Board revises the Local Housing Assistance Plan as proposed and if the revised plan is approved by the Florida Housing Finance Corporation, then $100,000 of FY 2001-2002 SHIP funds can be utilized as a SHIP rehabilitation grant by the Homeless Services Council. In such case, the following provisions will apply: The county's Rehabilitation grant will be secured by a mortgage in favor of Indian River County. The repayment of funds awarded as a rehabilitation grant will not be required, except in the case that the assisted units are sold within 10 years from the date of granting the award. OCTOBER 23, 2001 -85- EiR 12!JV 12!J 1 1 8