The Neighborhood Housing Initiatives Division (NHID) of the Michigan State Housing Development Authority (MSHDA) is pleased to announce the availability of $20 million of funding through the U.S. Department of Housing and Urban Development’s (HUD) Community Development Block Grant (CDBG) program for the creation of housing programs that benefit low- and moderate-income households.
Donor Name: Michigan State Housing Development Authority (MSHDA)
State: Michigan
County: All Counties
Type of Grant: Grant
Deadline: 09/25/2023
Size of the Grant: up to $500,000
Details:
MSHDA’s CDBG Housing Improving Local Livability (CHILL) Program provides annual grants to non-entitlement units of general local government—cities, towns, townships, villages, or counties not currently receiving a direct allocation of CDBG funds from HUD. Two activity types are eligible for funding: homeowner rehabilitation, to preserve affordable housing units; and demolition/reconstruction/resale, to remove blight and infill with single-family housing for resale to income eligible homebuyers.
Funding Information
Of the available funds, MSHDA will utilize $19.6 million for UGLG subawards with an 18% set aside for grantee administrative costs. $10 million will be made available for Homeowner Improvement and $6 million for Demolition/Reconstruction Resale. Grant awards will be based on a regional distribution of funding with 5% set aside for the Upper Peninsula (UP), 30% set aside for rural areas (including the 5% set aside for the UP, and 100% targeted to non-entitlement areas overall. Grants will be funded up to $500,000 maximum per UGLG (including administration costs). Applicants may propose more than one eligible activity, but the total funds requested may not exceed the maximum.
The program’s intent is to fund tangible housing activities that are implementation ready—able to be completed in eighteen (18) months); highly visible; impactful to the neighborhood and resident quality of life; holistically/community focused; and where there is buy-in and demonstrated support within the neighborhood and community.
Eligible Activities
CDBG eligible activities include preservation of owner-occupied housing through rehab and reconstruction and resale of housing on sites of a previous demolition. These activities are designed to further the following Rehabilitation and Preservation goals of the Michigan Statewide Housing Plan:
- Strategy 4.4.A: Increase the amount of funding devoted to rehabilitation and preservation in the state.
- Strategy 4.4.D: Increase access to no-interest, low-interest, and “patient capital” (long-term) lending products and grants to address the cost of home and rental repairs.
Homeowner Improvement Program (HIP) Preserving affordable owner-occupied housing units will be achieved by offering low- and moderate-income homeowners, defined as homeowners making less than 80% the area median income (AMI), up to $40,000 for rehabilitation activities to address health and safety concerns and maintenance issues. Projects requiring CDBG assistance of $10,000 or less will be offered as a grant with no requirement or expectation of repayment. CDBG assistance of $10,001 or more shall be offered as a zero interest zero payment loan, forgivable after five years and secured by a second mortgage. Eligible project costs are the actual costs of rehabilitating housing and activity delivery costs, including but not limited to interior and exterior improvements to meet code requirements, roof repair or replacement, siding, windows, plumbing, electrical, mechanical, and insulation.
Demolition/Reconstruction/Resale (DRR) This activity promotes blight reduction, reactivation of vacant parcels in established neighborhoods, infill construction, and affordable homeownership. It allows for the clearance of land through demolition, or the use of a vacant parcel recently cleared through the use of demolition (within last 12 months), in conjunction with the reconstruction and resale of single-family housing to a low- or moderate-income (80% AMI) homebuyer. CDBG assistance is capped at $200,000 per unit, secured by a construction mortgage during construction and discharged upon resale to an eligible buyer. Up to 20% of CDBG assistance can be used as subsidy—either as development or homebuyer subsidy. Homebuyers must receive a minimum of $1,000 of down payment or mortgage buy down assistance, in the form of a zero interest, zero payment loan, forgivable after five (5) years and secured by a second mortgage. Eligible project costs include but are not limited to property acquisition, demolition, costs to meet applicable building and construction standards, modest landscaping, and activity delivery costs (or reasonable developer fee).
Eligibility Criteria
MSHDA is currently accepting Letters of Intent (LOI) from eligible Units of General Local Government (UGLG) for proposals that meet the objectives of the CHILL program.
For more information, visit MSHDA.
