Powerpoint accompanying workshop session from the Homeless and Housing Coalition of Kentucky's 2013 conference. Presented by Bill Kerley, Pennyroyal Center Permanent supportive housing is a successful, cost-effective combination of affordable housing with services that helps reduce homelessness for people facing complex challenges and live more stable, productive lives. A major barrier to the construction of supportive housing is a lack of capacity among non-profit social service/homeless providers and housing developers. Service providers know how to provide case management services and help homeless families apply for rental assistance and other public benefits, but they don’t know how to structure tax- credit projects and access other funds available for affordable housing construction. Low-income housing developers know how to apply for tax credits and structure deals, but they don’t know how to provide supportive services to low-income families. This session will benefit all housing and service agencies interested in forging partnerships to develop permanent supportive housing projects

1. Kentucky Supportive Housing
Academy
Kentucky Housing Corporation
PROVIDED BY HOMELESS & HOUSING
COALITION OF KENTUCKY

2. Kentucky Interagency Council on
Homelessness

3. Kentucky Interagency Council on Homelessness:
Supportive Housing Committee
The committee’s purpose is to
encourage the construction of more
supportive housing projects in Kentucky.
The committee has identified capacity
building among non-profit social
service/homeless providers in affordable
housing development as an opportunity
which will result in more Supportive
Housing development.

4. Recovery Kentucky

5. Kentucky Supportive Housing
Academy
Service providers know how to provide
case management services and help
homeless families apply for rental assistance
and other public benefits, but they don't
know how to structure tax-credit projects
and access other funds available for
affordable housing construction. Low-
income housing developers know how to
apply for tax credits and structure deals, but
they don't know how to provide supportive
services to low-income families.

6. Homelessness & Mental Health
In comparison to other adults, those who
had been homeless were six times more
likely to have had an alcohol or drug
problem and three times more likely to have
had a psychiatric illness
(Greenburg and Rosenheck n.d.)

7. Supported housing defined
Dedicated housing resources or subsidies
combined with Human Services
Human Services are community-based mental
health services and practical assistance of the
social work profession.They must be intense,
flexible and sustained for many years.
(Ellen and O’Flaherty, How to House the Homeless, NewYork, 2010)
© 2012 Stephanie Sweeney & Associates

8. Pennyroyal RegionalVeterans
Program Center

9. Kentucky Supportive Housing
Academy
Hands-on technical assistance has
strengthened numerous community
development practitioners’ capacity. It
has bridged the gap between the
classroom and the neighborhood, helping
turn ideas into solid realities.

10. Goals & Objectives
Help participants understand the existing
world they are entering in the
development of affordable housing
Help participants understand risks &
rewards
Help participants understand the concept
of “asset management”

11. Why do non-profits participate in
housing development?
Social Services Provision
Percentage of Developer Fee supports
mission
Ownership interest in a significant asset
What organizations typically participate in
Housing Development?

12. Community Development Corporation or
CDC.
Also called, non-profit housing development
corporations (NDC’s)
Typically the corporation’s charter identifies the
development of affordable housing as the purpose
of the organization
Community Housing Development Organizations
(CHODO’s) commit to an additional level of
community participation. In return they can receive
operating support.

13. Kentucky Supportive Housing Academy will
include topics such as:
There are 3 phases in the life of the project
Development Stage
Leasing Stage
Operational Stage

14. The DevelopmentTeam – part 1
Developer - responsible for developing project,
overseeing construction and overseeing rent-up
and oversight of on going project operation
General Contractor – responsible for obtaining
building permits and insurance not specifically the
developer’s responsibility, building the project as
designed by the architect, working with
construction inspectors, and completing
construction on time and within budget
Architect - responsible for project design and
often construction supervision

15. The DevelopmentTeam – part 2
Attorney - responsible for review and
negotiation of loan and investor documents
Property Manager – responsible for tenant
certifications and the day-to-day operation
of the project
Accountant - reviews the closing financial
projection, confirms the carryover basis of
costs in the allocation year, prepares
partnership tax returns, and prepares the
cost certification required to begin the flow
of tax credits.
Consultant - Contributes project
development expertise to the process

16. How to choose the site
Rehab vs. new construction
Availability of rental subsidy
Local community & government support (vs.
NIMBY)
Local community & government financial
support
Market considerations
Considerations of impaction of affordable
housing & concentrations of populations
with special needs

17. How to choose the financing
We’ve considered the market – now what
is the appropriate number of units to
develop?
Low-income housing tax credits work
best on projects of at least 32 units
There are a variety of other tools
available to subsidize housing
developments of smaller size

18. Kentucky Supportive Housing
Academy
How TrainingWill Be Organized:
The training will occur over four months
and cover a range of topics critical to
supportive housing development. On the
last day of the training, the teams will make
formal presentations to a panel of funders
who will critique the proposals and make
suggestions for improvements to the
projects.

19. Kentucky Supportive Housing
Academy
Training session 1: Project concept development, selecting a project size and
design to fit the community and target population, community support and
budgeting
Training session 2: Service planning for special needs populations and
budgeting; targeting other project partners and commitments,
understanding rental assistance options, and supportive housing best
practices
Training session 3: Property management, operating budgets and operating
issues, and fair housing
Training session 4: Presentation to funders, with training completed before
Kentucky Housing Corporation releases its Qualified Allocation Plan.
Submission of project to KHC’s Qualified Allocation Plan tax credit or
appropriate program.

20. Kentucky Supportive Housing
Academy
The training will only be available to
organizations, including CHDOs, with a
commitment to developing low-income
supportive housing. Participants will be
required to form development teams in
order to apply for the training. The teams
will include three people: representatives of
a service provider; property management
agency; and housing developer.The training
will have the capacity for up to ten three-
person development teams.

21. Pre-Development:
Forming project plans
Analyzing project budget to identify cost
savings opportunities
Identifying understated project costs to
prevent overruns
Recommending modifications to the budget,
financial structure and terms of the financial
commitment to enhance project viability
Developing the financial package for
submission to private and public sources of
funding for financing

22. Financing:
Negotiating with private and public lenders
for funding to achieve the desired structure
Confirming financing commitments from
lenders and investors
Assistance with FHLB Affordable Housing
Program applications
Finding equity investors to purchase tax
credits or become partners in ownership
Loan servicing

23. Construction:
Working with developers
Managing construction and improvements
Negotiating construction contracts

24. Management:
Identifying potential tenants
Handling marketing and pre-leasing
Negotiating leases
Selecting and retaining a management firm
Managing assets

25. SMI Housing, Cincinnati, OH

26. LIHTC Organizational Structure

27. Primary risks to non-profit during
development phase
Risk should be commensurate to level of
control – the non-profit sponsor should
be cautious of responsibility of cost
overruns.
Should the non-profit sponsor take on
responsibility for areas where it lacks
expertise such as building permits?
How to hold the development team
accountable.

28. Leasing PhaseTax credit adjusters
The tax credit proforma contains certain
time limits for the lease up of units. It is
only through the lease up of units that
investors can actually take their credit.
The limited partnership agreement (LPA)
will protect the investors in the case units
do not lease up as quickly as forseen!

29. Kentucky Supportive Housing
Academy

30. Kentucky Supportive Housing
Academy

31. For more information & to register:
FrancesW.Alvis
Executive Director
(502) 223-1834 ext. 1114
falvis@hhck.org
306W Main St, Ste. 207 (McClure Building)
Frankfort, KY 40601