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October 17, 2008

Recommendations for the Implementation of the
2008 Neighborhood Stabilization Program (NSP)

Presented to: Miami Dade County, Miami, North Miami, Hialeah, North Miami Gardens, Miami Gardens, and Homestead (The “Grantees”) by the  South Florida Community Development Coalition, Inc.,  October 16, 2008

• Property Acquisition. Grantees should consider their administrative capacity and ability to use NSP funds within the statutory deadline.  For this reason they should make the funds available to non-profit and for-profit developers for the acquisition and redevelopment of properties.  This mechanism will provide a more streamlined and efficient process than then the Grantees themselves directly acquiring properties.

• Complying with the Short Deadlines Imposed by the Federal Regulations:  Grantees should utilize their existing RFP and RFA processes which they should modify to include simultaneous approval of both the developer and the amount and use of the funds.  Doing that will reduce the time from the initial application to decision.

• Selection of Developers:  Approval of developer entities to acquire property should include such considerations as ability to proceed, capacity, experience in working with these types of properties and purchasers, leveraging, and a demonstration by the developer of an appropriate timeline for delivery. 

• Compliance with NSP Affordability Restrictions: The easiest way for Grantees to comply with the NSP regulations would be to adopt the affordability restrictions and guidelines set forth by the federal Community Development Block Grant (CDBG) and federal HOME Programs where applicable (a method authorized in the NSP regulations).  In no event should the affordability restrictions be more restrictive than what is provided by these Federal Regulations.  The primary purpose of the Housing and Economic Recovery Act (HERA) is neighborhood stabilization.  Therefore, properties targeted by NSP funds should not be encumbered by excessive restrictions which may ultimately diminish the overall stability and value of the neighborhood. 

• Rental Properties: The NSP Regulations mandate that 25% of the funds benefit individuals and families whose income does not exceed 50% of AMI.  To meet this requirement, the Grantees should allocate 25% of the funds for developers that want to acquire and rehabilitate rental properties.

• Enhance Homebuyer Education Component: In accordance with the NSP Regulations up to 10% of an NSP grant provided to a jurisdiction and up to 10% of program income earned may be used for general administrative and planning activities as defined at 24 CFR 570.205 and 206.  The Coalition recommends that some portion of this 10% amount be used to assist qualified approved homebuyer counseling agencies.  Such counseling is required by the NSP regulations. Doing this will mitigate the potential for homebuyer failure and will also reduce the potential for foreclosures.
  

The South Florida Community Development Coalition and its members are committed to creating and strengthening our community’s vision of how we can make our neighborhoods more stable, sustainable, competitive, and integrated.  Our organization is intimately familiar with the current needs of our residents.  We are here to assist our local governmental entities with this new challenge of creating and implementing policies and procedures in utilizing the NSP funds to increase access to affordable housing while adhering to the federal regulations and statutory timelines.