Pleasant Hill City Council
September 12, 2022

STATE OF CALIFORNIA - BUSINESS, CONSUMER SERVICES AND HOUSING AGENCY GAVIN NEWSOM, Governor

DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT

DIVISION OF STATE FINANCIAL ASSISTANCE
2020 W. El Camino Avenue, Suite 670, 95833
P. O. Box 952054
Sacramento, CA 94252-2054
(916) 263-2771
www.hcd.ca.gov March 30, 2022
Amended June 10, 2022
MEMORANDUM FOR: POTENTIAL APPLICANTS
FROM: Jennifer Seeger, Deputy Director
Division of State Financial Assistance
SUBJECT: Multifamily Finance Super Notice of Funding Availability Amendment #1
This Super NOFA and its applicable Guidelines are intended to advance the State’s goal of creating 2.5 million homes by 2030 according to the 2022 Statewide Housing Plan, and in particular assist in producing the more than 1 million homes needed for Californians experiencing homelessness and people with low and very low incomes.

Together, the Guidelines and Super NOFA have these primary goals:

1. Produce more affordable and climate smart housing,

2. Act with urgency to address homelessness and housing stability,

3. Consolidate and streamline State affordable housing programs,

4. Reduce time and cost to develop housing,

5. Prioritize equitable State policy objectives in the creation of more homes in the State, and

6. Harmonize those State policy objectives with the broader affordable housing finance system.

The California Department of Housing and Community Development (Department or HCD) is pleased to announce the release of its initial Multifamily Finance Super Notice of Funding Availability (Super NOFA), for approximately $650 million in funds available under the following Programs:
• Multifamily Housing Program (MHP)
• Veterans Housing and Homelessness Prevention (VHHP) Program • Joe Serna, Jr. Farmworker Housing Grant (FWHG) Program • Infill Incentive Grant Program of 2007 (IIG-2007) and Infill Infrastructure Grant Program of 2019 (IIG-2019)
In response to stakeholder feedback, the Department is amending the previously issued March 30, 2022 Super NOFA, and include the following:

1. Extension of the application due date from June 28, 2022 to July 12, 2022.

2. Clarification on Housing Element compliance threshold requirements and timing.

3. The IIG per Unit grant amounts updated based on December Consumer Price Index per U.S. Bureau of Labor Statistics (BLS)
Multifamily Housing Super NOFA
March 30, 2022 (Amended June 10, 2022)

4. Updated tiebreaker adjustment factors

5. Clarifying language added to Tribal Entity and Emerging and Community Based Developer Set-Asides

6. Clarifying language added to Program Funding Amounts and Terms

7. Clarifying language regarding concurrent applications using 4 and 9 Percent Tax Credits

8. Clarifying language regarding applicability of the Department’s Negative Points Policy.

9. Other non-technical changes for enhanced readability and to provide clarity.

These changes are shown in red strikeout and underline throughout the NOFA.

Per California Assembly Bill No. 434 (AB 434) (Chapter 192, Statutes of 2020), HCD is required to do the following for the programs listed above: (1) make the program funds available at the same time it makes funds, if any, available under the Multifamily Housing Program (MHP); (2) rate and rank the applications in a manner consistent with MHP; (3) administer the funds in a manner consistent with MHP; and (4) to the extent applicable, make the terms of any Designated Program loan consistent with MHP loan terms. 1 This marks the first year for HCD to issue a Super NOFA that will provide applicants the opportunity to apply for any combination of the available funding programs at the same time and within the same round. The Super NOFA makes funds more accessible to developers (including emerging and community-based developers, and Tribal Entities), enables the funding to further serve the lowest-income Californians, and increases the range of potential applicants and target populations to achieve better outcomes in health, climate, and household stability.

Application materials must be submitted electronically via the Super NOFA Application Portal “SNAP” no later than 4:00 p.m. Pacific Daylight Time on July 12, 2022. SNAP portal application upload and submittal instructions will be released with the application documents. Personal deliveries will not be accepted. No facsimiles, incomplete applications, application revisions, or walk-in application packages will be accepted.

The Super NOFA Application, online workshop details, and guidelines are posted on HCD’s website AB 434 Multifamily Finance Super NOFA. The Super NOFA application will available and posted to the website no later than April 20, 2022. To receive information regarding online workshops and other updates, please subscribe to the Super NOFA email list.

If you have further questions, please contact [email protected]. 1 The Housing for a Healthy California Program (HHC) and the Transit-Oriented Development Implementation Program (TOD) are also identified as programs subject to AB 434 but are not included in this NOFA as there is no program funding available at this time.

MULTIFAMILY HOUSING DEVELOPMENT FUNDING
2022 Multifamily Finance Super
Notice of Funding Availability- Amendment #1
(Super NOFA)
Gavin Newsom, Governor
State of California
Lourdes Castro Ramírez, Secretary
Business, Consumer Services and Housing Agency
Gustavo Velasquez, Director
Department of Housing and Community Development
2020 West El Camino Avenue, Suite 500, Sacramento, CA 95833 Telephone: (916) 263-2771
Website: AB 434 Multifamily Finance Super NOFA
Email: [email protected]
March 30, 2022
Amended June 10, 2022
Table of Contents
I. Overview …………………………………………………………………………………………..1
A. Notice of Funding Availability (NOFA)................................................................................................. 1 B. Timeline......................................................................................................................................................... 3 C. Authorizing Legislation and Regulations............................................................................................. 3 II. Program Requirements........................................................................................................4 A. Eligible Sponsor/Applicant....................................................................................................................... 4 B. Eligible Projects .......................................................................................................................................... 5 C. Eligible Use of Funds ................................................................................................................................ 5 D. Program Funding Amounts and Terms ............................................................................................... 6 E. Site Control ................................................................................................................................................ 11 F. Set-Asides, Geographic Distribution of Funds, and Discretionary Funds............................... 13 G. Funding Limits........................................................................................................................................... 16 H. Cost Limitations ........................................................................................................................................ 19 I. Threshold.................................................................................................................................................... 20 J. Scoring and Ranking............................................................................................................................... 23 K. Negative Points and Disencumbrance Policies .............................................................................. 26 III. Application Submission and Review Procedures ...........................................................26 A. Application Submission Process ......................................................................................................... 26 B. Electronic Submission ............................................................................................................................ 26 C. Application Workshops and Pre-Application Consultation .......................................................... 27 D. Disclosure of Application........................................................................................................................ 27 E. Concurrent Applications......................................................................................................................... 27 F. Prior Awards .............................................................................................................................................. 28 G. Significant Changes in Project After Application ............................................................................ 28 IV. Universal Scoring Criteria..................................................................................................28 A. Summary..................................................................................................................................................... 28 B. Extent to which the Project serves households at the lowest income levels ......................... 29 C. State Policy Priorities .............................................................................................................................. 31 D. Project Sponsor/Applicant and Property Management Experience ......................................... 32 E. Project Readiness ................................................................................................................................... 37 F. Adaptive Reuse / Infill / Proximity to Amenities / Sustainable Building Methods ................ 39 G. Cost Containment .................................................................................................................................... 42 H. Tiebreaker Score...................................................................................................................................... 43 V. Appeals................................................................................................................................46 A. Basis of Appeals....................................................................................................................................... 46 B. Appeal Process and Deadlines............................................................................................................ 46 C. Decision ...................................................................................................................................................... 46 VI. Award Announcements and Contracts.............................................................................47 A. Award Announcements .......................................................................................................................... 47 B. Contracts..................................................................................................................................................... 47 VII. Other State Requirements ............................................................................................47 A. Article XXXIV............................................................................................................................................. 48 B. California’s Preservation Notice Law ................................................................................................. 49 C. Relocation................................................................................................................................................... 49 VIII. Other Terms and Conditions........................................................................................49 A. Right to Modify or Suspend................................................................................................................... 49 B. Conflicts ...................................................................................................................................................... 49 California Department of Housing and Community Development Page 1 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) I. Overview
A. Notice of Funding Availability (NOFA)
The Department of Housing and Community Development (Department or HCD) is pleased to announce the initial release of this Multifamily Finance Super Notice of Funding Availability for approximately $650 million in funds, which may be augmented based on availability of funds. Since the NOFA consolidates up to six housing Programs, it is also referred to as a Super NOFA. The Super NOFA is issued to distribute funds through a combination of HCD-administered multifamily rental housing and infrastructure Programs. The Super NOFA and Guidelines for these Programs implement the requirements of California Assembly Bill 434 (AB 434) (Chapter 192, Statutes of 2020). AB 434 amends, repeals, and adds sections to the Health and Safety Code (HSC) and to the Military and Veterans Code in relation to the Designated Programs.

In addition to the Designated Programs named in AB 434, HCD is also making Infill Infrastructure Grant (IIG) funding available for Large Jurisdiction Qualifying Infill Projects (QIPs) available under Infill Infrastructure Grant Program of 2019 (IIG2019). As such, IIG will have two programs (2007 and 2019) with funding available.

While IIG-2007 is a Designated Program under AB 434, IIG-2019 is not a Designated Program, and therefore is not required to harmonize with the Multifamily Housing Program (MHP). However, in an effort to streamline the development process, the Department has included IIG-2019 funds with the Super NOFA.

Programs providing funding pursuant to this Super NOFA include the following:
• Multifamily Housing Program (MHP) which provides loans to assist the new construction, Rehabilitation, and conversion of permanent and transitional rental housing for Lower Income households.
• Veterans Housing and Homelessness Prevention (VHHP) program which provides funds for acquisition, construction, Rehabilitation, and preservation of affordable multifamily housing for Veterans and their families to allow Veterans to access and maintain housing stability.
• Joe Serna, Jr. Farmworker Housing Grant (FWHG) program which provides construction loans or deferred loans for multifamily housing, new construction, or Rehabilitation to serve Agricultural Workers with a priority for Lower Income households.
• Infill Incentive Grant Program (IIG) of 2007 (IIG-2007) and Infill Infrastructure Grant Program of 2019 (IIG-2019) which provides grant assistance available as gap funding for infrastructure improvements necessary for specific residential or mixed-use infill development projects. Under IIG, eligible infrastructure improvements are referred to as Capital Improvement California Department of Housing and Community Development Page 2 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) Projects (CIPs). 2 They are associated with specific residential or mixed-use infill development projects, or Qualified Infill Projects (QIPs).

Unless otherwise indicated by context, the term “Project” should be interpreted to mean “Capital Improvement Project” when considered in connection with IIG-2007 or IIG-2019 funding.

Funding for this Super NOFA is provided by a combination of funding sources as outlined below:
• Veterans and Affordable Housing Bond Act of 2018 (Proposition 1): Provides funding for IIG-2007, MHP, and FWHG.
• General Fund (as appropriated in the 2021 Budget Act): Provides funding for IIG2019. • Building Homes and Jobs Act (Senate Bill 2) Building Homes and Jobs Act (Senate Bill 2): Provides funding for FWHG.
• Veterans Bond Act of 2008 (as amended by the Veterans Housing and Homeless Prevention Bond Act of 2014 (Prop 41): Provides funding for VHHP. *Total funds awarded maybe augmented based on the availability of funds. 2 For IIG, “Project” or “Capital Improvement Project” or “CIP” means the construction, Rehabilitation, demolition, relocation, acquisition, or other physical improvement of a Capital Asset that is an integral part of, or necessary to facilitate the development of, a Qualifying Infill Project or Qualifying Infill Area. Projects that may be funded under the Program include, but are not limited to, those described in Section 200 of IIG-2007 Guidelines.
3 Please note that the Housing for a Healthy California Program (HHC) and the Transit-Oriented Development Implementation Program (TOD) are also identified as Programs subject to AB 434 but are not included in this Super NOFA as there is no Program funding available at this time.

Funding Program3
Approximate
Funding
Available
Multifamily Housing Program (MHP) $275 million
Veterans Housing and Homelessness Prevention (VHHP)
Program $95 million
Joe Serna, Jr. Farmworker Housing Grant (FWHG) Program $80 million Infill Incentive Grant Program (IIG-2007) and
Infill Infrastructure Grant Program (IIG-2019) $200 million Total Super NOFA fund available: $650 million*
California Department of Housing and Community Development Page 3 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) AB 434 requires the Department to harmonize the other Designated Programs with MHP in four respects: 1) the Department is to make Designated Program funds available at the same time as it makes any MHP funds available; 2) it is to rate and rank Designated Program applications in a manner consistent with MHP applications; 3) it is to administer Designated Program funds consistent with MHP; and 4) to the extent applicable, it is to make the terms of any Designated Program loan consistent with MHP loan terms.

The Super NOFA and the Guidelines for each Designated Program (Designated Program Guidelines or Guidelines) implement AB 434. The MHP Guidelines provide a central set of “general” rules and standards that govern the distribution and administration of all Designated Program funds subject to the requirements of AB 434. The separate sets of VHHP, FWHG, and IIG Guidelines incorporate MHP rules and standards, and maintain the distinctive features of their respective Programs by establishing Program-specific threshold criteria and other Programspecific provisions.

The funds awarded under this Super NOFA will be allocated as permanent financing for affordable new construction, construction financing (FWHG), Rehabilitation, preservation, conversion of nonresidential structures to affordable rental housing or Transitional Housing for households with incomes at or below 60 percent of Area Median Income (AMI), unless the Program-specific Guidelines state otherwise (i.e., for FWHG this is 80 percent AMI).

B. Timeline
NOFA Release March 30, 2022
Application Release May 6, 2022
Super NOFA Application Portal
(SNAP) opens
May 6, 2022
Application Due Date July 12, 2022 by 4:00 p.m. PDT
Award Announcement December 2022
C. Authorizing Legislation and Regulations
Applications submitted under this Super NOFA are subject to the applicable Program Guidelines, all applicable statutory requirements, and this Super NOFA.

Section references in this Super NOFA refer to Program Guidelines unless otherwise noted. Capitalized terms in this Super NOFA are either defined herein or in the Designated Program Guidelines. The Guidelines and Super NOFA are available at Multifamily Finance Super NOFA.

California Department of Housing and Community Development Page 4 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) The administration of the Designated Programs and IIG-2019 are governed by the Guidelines that implement, interpret, or make specific the following laws:
• MHP was established by Chapter 637, Statutes of 1999 (SB 1121), which created Chapter 6.7 (commencing with Section 50675) of Part 2 of Division 31 of the HSC.
• VHHP was established by Article 3.2 (commencing with Section 997.001) of Chapter 6 of Division 4 of the Military and Veterans Code. • FWHG was established by Chapter 3.2 (commencing with Section 50515.2) of Part 2 of Division 31 of the HSC. The FWHG Guidelines referenced in this Super NOFA apply only to Rental Housing Developments. Single-family development activities will be governed under a separate set of program guidelines consistent with AB 434 at a later time.
• IIG-2007 was established by Chapter 2 (commencing with Section 53545.13) of Part 12 of Division 31 of the HSC. The IIG Guidelines under AB 434 apply only to QIPs.
• IIG-2019 was established by Part 12.5 (commencing with Section 53559) of Division 31 of the HSC. The rules pertaining to all QIPs in Large Jurisdictions are now set forth in the IIG-2007 Guidelines. The IIG-2007 Guidelines amend and restate the IIG-2019 Guidelines only with respect to Large Jurisdiction QIPs.

II. Program Requirements
The following is provided as a summary only. Applicants should refer to the MHP, VHHP, FWHG, and IIG Guidelines, as applicable, for a comprehensive discussion of the requirements that are relevant to their proposed Projects.

A Project is not eligible for an award unless it meets all the threshold requirements of the applicable Designated Program(s) and IIG-2019. Please review the individual Program Guidelines of each Program for complete information. Further, Sponsors/Applicants must achieve a minimum point score of 85 points in Universal Scoring Criteria to be considered for a funding award.

A. Eligible Sponsor/Applicant
An Applicant is the entity or entities applying to the Department for the Program funding. Such entity or entities may also be the Sponsor. If receiving an award of funds, the Applicant or co-Applicants will, both individually and collectively, be referred to as the “Recipient” in the Department’s legal documents relative to an award of a grant, or as “Sponsor” in the Department’s legal documents relative to an award of a loan.

California Department of Housing and Community Development Page 5 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) A Sponsor shall be any individual, Joint Venture, partnership, Limited Liability Company, Limited Partnership (including a Limited Partnership in which the Sponsor or an affiliate is a general partner), trust, corporation, cooperative, Local Public Entity, Tribal Entity, other legal entity, or any combination thereof which meets the requirements of the following sections of the Designated Program Guidelines as referenced below:
(1) MHP Section 7303 Eligible Sponsor
(2) VHHP Section 203 Eligible Sponsor
(3) FWHG Section 203 Eligible Sponsor
a. The Sponsor shall demonstrate to the Department's satisfaction that the Sponsor is independent from any direction of, or control by, a for-profit entity, and shall meet the requirements of HSC 50517.5.
(4) IIG Section 201 Eligible Applicant (for additional information on IIG-2019 see Section 206: IIG 2019 Large Jurisdiction QIPs)
a. Please note, IIG Guideline Section 206 (a)(2) requires that a letter of support be submitted for a Qualifying Infill Project from the local governing body. For any applicant that is requesting IIG funding in combination with any other Super NOFA funding source or IIG funding on its own, the due date to meet the requirement has been extended to September 30, 2022, 5pm PDT. i. This extension is specific to this requirement and does not provide an extension to any other requirement. The required letter of support is listed in the Super NOFA Application, Document checklist, as Attachment #84.

Failure to provide this attachment by the date and time listed above will result in the disqualification of the Project for failure to meet minimum threshold requirements as stated in MHP Guidelines Section 7303.1 (a) and (d) and Section 7318.

B. Eligible Projects
Eligible Projects must meet the requirements set forth in the sections of the Designated Program Guidelines:
• MHP Guidelines Section 7302: Eligible Project
• VHHP Guidelines Section 201: Eligible Project
• FWHG Guidelines Section 202: Eligible Project
• IIG Guidelines Section 200: Eligible Capital Improvement Projects (for additional information on IIG-2019 see Section 206 IIG: 2019 Large Jurisdiction QIPs) C. Eligible Use of Funds
Funds shall be used only for approved eligible costs that are incurred on the Project as set forth in the MHP, VHHP and FWHG Designated Guidelines sections indicated below, including interim or bridge loans used to pay such costs. In California Department of Housing and Community Development Page 6 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) addition, the costs must be necessary and must be consistent with the lowest reasonable cost consistent with the Project's scope and area as determined by the Department.
• MHP Guidelines Section 7304: Eligible Use of Funds
• VHHP Guidelines Section 204: Eligible Uses of Funds
• FWHG Guidelines Section 205: Eligible Use of Funds
• IIG Guidelines Section 203: Eligible Use of Funds
IIG funds shall be used only for approved eligible costs that are incurred on the CIP as set forth in the IIG Guidelines. In addition, the costs must be necessary and must be consistent with the lowest reasonable cost consistent with the Project's scope and area as determined by HCD.

D. Program Funding Amounts and Terms

1. MHP, VHHP, FWHG Loans
Program funding shall be sized in accordance with the per Unit loan limits listed below:
a. Per Unit loan limits are applicable regardless of the number of sources stacked on the Unit. If requesting funding from more than one Department Program, the per Unit loan limits in paragraph c. below are applicable to the sum total of all Department loans.

Per Unit loan limit will be calculated based upon the Unit’s level of income restriction.

Manager Units, if requested by the applicant will be included in the per Unit loan limit calculation at the 60 percent AMI level.
b. For MHP loan limit calculations, the Unit count may include the number of Restricted Units within the Rental Housing Development (Restricted Units include Units with long-term, low-income or occupancy restrictions imposed by HCD, Tax Credit Allocation Committee (TCAC), or other public agencies and restricted at no greater than 60 percent AMI). Please refer to NOFA Section (II)(G)(5) below for additional information and limitations on MHP funding of Restricted Units. Notably, Units assisted by a VHHP or FWHG award under the Super NOFA will not be additionally assisted by MHP.

For VHHP and FWHG loan limit calculations, the Unit count shall include the number of Assisted Units within the Rental Housing Development.

For FWHG, Assisted Units may be restricted at levels to not exceed 80 percent AMI, however Units greater than 60 percent AMI are funded at 60 percent loan limits amounts.

California Department of Housing and Community Development Page 7 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) c. The amount per Assisted Unit (Restricted Unit for MHP) shall be the amount required to reduce Rents from 30 percent of 60 percent (80 percent for FWHG) of AMI to the actual maximum restricted Rent for the Unit, assuming that the Rent reduction will be achieved by substituting Program funds for private amortized debt and calculated by the Department based on private market multifamily rental loan terms available at the time of issuance of this NOFA.
d. The initial base loan amount shall be:
• $150,000 per Assisted Unit (Restricted Unit for MHP) utilizing 9 percent tax credits,
• $200,000 per Assisted Unit (Restricted Unit for MHP) utilizing 4 percent tax credits, or
• $225,000 per Assisted Unit (Restricted Unit for MHP) utilizing no tax credits.

The initial base per Unit loan limit is inclusive of all requested Super NOFA program loan funds and all Department loan awards made prior to the application close date.
e. The following applications will have the initial base increased by a max $25,000 per Assisted Unit (Restricted Unit for MHP):
• Co-applications including Joint Ventures, co-Sponsors, partnerships, Limited Liability Companies, or Limited Partnerships between an experienced Sponsor and an Emerging Developer (a Tribal Entity may also be an Emerging Developer).
• Projects eligible for High/Highest Resource Area points under the Universal Scoring Criteria; or
• Projects requesting Super NOFA funds in MHP or VHHP where at least 45 percent of the total Restricted Units are restricted in a Department Regulatory Agreement to Special Needs Populations (as defined in Appendix A of the Designated Program Guidelines) or to any VHHP Target Population.
4 Note: The requirement for an increased base loan amount is greater than the minimum required 25 percent of Restricted Units for eligibility as a Special Needs Project type.
4 For the purposes of this paragraph, total Restricted Units means all units at or below 60% AMI as well as all FWHG Units at or below 80%.

California Department of Housing and Community Development Page 8 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) Even if more than one of the above applies, the base loan amount may only be increased by $25,000 per Assisted Unit (Restricted Unit for MHP). f. Program loans shall have an initial term of 55 years or longer to match the period of affordability restrictions under the Low-Income Housing Tax Credit (LIHTC) Program. Permanent loans and FWHG construction financing shall be secured by the Project’s real property and improvements, which may be subject only to liens, encumbrances, and other matters of record approved by HCD, and which are consistent with Uniform Multifamily Regulations (UMR) Section 8316.
g. Program loans for Projects on Tribal Trust Land shall have an initial term of 50 years if an initial term of 55 years is deemed infeasible as determined by the Department.

2. IIG Funding Amounts and Terms
a. Funding Amounts
IIG funding shall be sized in accordance with the grant limits listed below:

For a QIP, the minimum Program grant award is $1 million in urban areas and $500,000 in Rural Areas. The total Program grant award to any QIP is limited to $7.5 million under this Super NOFA.

Pursuant to Section 205 of the IIG Guidelines, the total grant amount shall be determined by the number of Units in the QIP, the bedroom count of these Units, and the density and affordability of the housing to be developed. The total eligible grant amount shall be based upon the lesser of the amount necessary to fund the CIP or the maximum amount permitted by the IIG Grant Amount Calculation table, whichever is less. See the IIG Grant Amount Calculation table below:

California Department of Housing and Community Development Page 9 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) *Increases based on December Consumer Price Index per U.S. Bureau of Labor Statistics (BLS).

Grant amounts established by the IIG Grant Amount Calculation table may be increased based on proposed housing Units per acre, as represented in the following Net Density Adjustment Factor table below.

Net Density Adjustment Factor
Net Density
(Housing Units per acre)
Adjustment
Factor
Fewer than 45 1
45 – 49.9 1.04
50 – 54.9 1.08
55 – 59.9 1.12
60 – 64.9 1.16
65 – 69.9 1.20
70 – 74.9 1.24
75 – 79.9 1.28
80 – 84.9 1.32
85 – 89.9 1.36
5 200 percent Fair Market Rent (FMR) Unit: A 200 percent FMR Unit is a rental Unit with a proposed monthly Rent, which is equal to or greater than 200 percent of its county’s FMR as defined by Department of Housing and Community Development (HUD). 6 IIG Unrestricted: An unrestricted unit for the purposes of calculating grant amounts in IIG is any Unit not restricted at the other levels identified in Guidelines Appendix A Defined Terms, but also not meeting any of the above definitions.

IIG Grant Amount Calculation
(Amounts are represented on a per Unit basis)
Income Level &
Tenure 0-Bdrm 1-Bdrm 2-Bdrm 3-Bdrm 4-Bdrm
200% FMR5 $4,000 $8,000 $11,900 $15,900 $19,900
Program
Unrestricted6
$26,500 $30,500 $35,400 $43,700 $47,700
60% AMI Rental $34,400 $38,400 $46,300 $54,200 $59,600
50 percent AMI
Rental
$39,800 $45,000 $51,600 $62,100 $66,200
30 percent AMI
Rental
$46,300 $49,000 $55,600 $71,500 $75,400
California Department of Housing and Community Development Page 10 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) 90 – 94.9 1.40
95 – 99.9 1.44
100 – 104.9 1.48
105 and above 1.52
For this Super NOFA, HCD is making IIG funding for QIPs available from two different sources. HCD will first evaluate whether Applicants satisfy IIG-2007 and/or IIG-2019 threshold requirements. Applications that meet neither set of requirements will be disqualified. HCD will then rate/rank the remaining applications according to the Universal Scoring Criteria. HCD will award IIG2007 funds to Applicants that passed IIG-2007 threshold, according to their ranked order, until that funding is exhausted. HCD will then award IIG-2019 funds to Applicants that passed IIG-2019 threshold, according to their ranked order. Unsuccessful IIG-2007 Applicants will be awarded IIG-2019 funds if they made the IIG-2019 “opt-in” election and if they satisfied IIG-2019 threshold requirements.
b. Terms of the Proposed Award
The terms of the award are set forth in the Performance Deadlines subsection of this NOFA below. Grant terms will be outlined in the Standard Agreement.

In consideration for the IIG award to the Recipient, there shall be a Covenant7 recorded against the fee interest of the real property site(s) of the QIP, which shall impose development, use, and affordability restrictions upon the real property. The Covenant shall be binding, effective and enforceable commencing upon its execution and shall continue in full force and effect for a period of not less than 55 years for Rental Housing Developments after a certificate of occupancy or its equivalent has been issued for the Affordable Housing Development by the local jurisdiction or, if no such certificate is issued, from the date of initial occupancy of the Affordable Housing Development.

Where the QIP is receiving low-income housing tax credits, the Recipient may provide Program funds to the Sponsor of the QIP in the form of a zero percent deferred payment loan, with a term of at least 55 years. The loan may be secured by a deed of trust, which shall be subordinate to all Department loan and grant documents, and which may be recorded with the local county recorder’s office, provided the beneficiary of the loan shall not under any 7 “Covenant” or “Affordability Covenant” means an instrument which imposes development, use, and affordability restrictions on the real property site(s) of the Qualifying Infill Project or of the designated housing in the Qualifying Infill Area, and which is recorded against the fee interest in such real property site(s). The Covenant is executed as consideration for the IIG Program award to the Recipient.

California Department of Housing and Community Development Page 11 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) circumstances exercise any remedy, including, without limitation, foreclosure, under the deed of trust without the prior written consent of the Department, in its sole and absolute discretion.

Additional requirements are set forth in Section 205 of the IIG Guidelines. c. Performance Deadlines
i. The QIP shall complete construction of the housing Units which were used as the basis for calculating the Program award within three years of securing all permanent financing. Completion of construction must be evidenced by a certificate of occupancy or equivalent documentation submitted to the Department.
ii. Program funds must be disbursed by the Program liquidation date of June 30, 2026. The Recipient must submit final disbursement requests no later than March 31, 2026.

E. Site Control

1. MHP, VHHP and FWHG
MHP, VHHP, and FWHG Projects shall comply with the site control requirements as set forth in UMR Section 8303 with the exception that the Sponsor shall maintain site control through the proposed award date, as stated in the Super NOFA with the option to extend beyond that date.

Where site control is in the name of another entity, the Applicant shall submit documentation, in form and substance reasonably satisfactory to the Department (e.g. a purchase and sale agreement, an option, a leasehold interest/option, a disposition and development agreement, an exclusive right to negotiate with a public agency for the acquisition of the site), which clearly demonstrates that the Applicant controls the owner entity and has some form of right to acquire or lease the Project property.

Where site control will be satisfied by a long-term ground lease, the Department will require the execution and recordation of the Department’s form lease rider, which shall be entered into by and among the ground lessor, the ground lessee, the Department, and any other applicable parties. In all cases, the lease rider shall be recorded against the fee interest in the Project property. a. For Projects developed in Indian Country, the following exceptions to the foregoing requirements apply:
i. Where site control is a ground lease, the lease agreement between the Tribal Entity and the Project owner is for a period not less than 50 years; and
California Department of Housing and Community Development Page 12 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) ii. An attorney’s opinion regarding chain of title and current title status is acceptable in lieu of a title report.

2. IIG
The QIP and CIP shall comply with the site control requirements as set forth in UMR Section 8303 with the exception that the Applicant shall also maintain site control as memorialized in the Standard Agreement.
a. The following additional requirements shall apply to IIG QIP projects:
i. Where site control is in the name of another entity, the Applicant shall provide documentation, in form and substance reasonably satisfactory to HCD (e.g., a purchase and sale agreement, an option, a leasehold interest/option, a disposition and development agreement, an exclusive right to negotiate with a public agency for the acquisition of the site), which clearly demonstrates that the Applicant has some form of right to acquire or lease the Project property.
ii. Where site control will be satisfied by a long-term ground lease, the Department will require the execution and recordation of the Department’s form lease rider, which shall be entered into by and among the ground lessor, the ground lessee, the Department, and any other applicable parties. In all cases, the lease rider shall be recorded against the fee interest in the Project property.

b. The following shall apply to offsite work proposed for CIPs and shall be evidenced prior to the disbursement of Program Funds:
i. Recipient/Sponsor shall have a right of way or easement, which is either perpetual, or of sufficient duration to meet Program requirements, and which allows the Recipient and/or Sponsor to access, improve, occupy, use, maintain, repair, and alter the property underlying the right of way or easement; and
ii. Recipient/Sponsor shall have an executed encroachment permit for construction of any improvements or facilities within the public right of way or on public land.
c. For QIPs and CIPs developed in Indian Country, the following exceptions to the foregoing requirements apply:
i. Where site control is a ground lease, the lease agreement between the Tribal Entity and the Sponsor/Project owner is for a period not less than 50 years; and
ii. An attorney’s opinion regarding chain of title and current title status is California Department of Housing and Community Development Page 13 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) acceptable in lieu of a title report.

F. Set-Asides, Geographic Distribution of Funds, and Discretionary Funds

1. Set-Asides
To promote equitable distribution of Program funds, to the extent eligible applications are available to fund, this Super NOFA shall have the following setaside goals listed below:
a. Tribal Entity: To the extent possible, no less than five percent of the total Super NOFA funds, or approximately $32,500,000. In the event the Tribal Entity set-aside is not fully awarded under this Super NOFA, an amount equal to any remaining funds within the Tribal Entity set-aside will be added to a subsequent NOFA for the purposes of a Tribal Entity set-aside. b. Emerging and Community-Based Developers: To the extent possible, no less than 15 percent of the total Super NOFA funds, or approximately $97,500,000, with one-third of this set-aside reserved for Emerging Developers. The remaining two-thirds is reserved for both Emerging and Community-Based Developers.

Community-Based Developers may only compete in the set-aside for this Super NOFA if they meet BOTH of the following: 1) maintain their corporate headquarters within 10 miles of the proposed project site or have three (3) deed-restricted affordable housing projects within 10 miles of the proposed project site; AND 2) directly provide at least two community benefit programs accessible to the general public within 10 miles of the proposed project as detailed below:
i. Community benefit programs may include, but are not limited to, the following:
• Free or reduced-cost childcare, after-school care, youth development, or adult day care programs.
• Community center facilities that are staffed and open to the public at least once a week or a minimum of 7 hours each week.
• Medical clinic with a physician, physician’s assistant, or nurse practitioner onsite for a minimum of 40 hours each week. • Small business technical assistance, lending, or investment to at least ten neighborhood businesses within five miles of the proposed Project. • Job training, digital literacy training, college outreach (linking potential students to college resources and information), financial counseling, housing counseling, free tax return, or other economic empowerment programs.
• Food distribution programs.

California Department of Housing and Community Development Page 14 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) All community benefit programs must be provided directly by the CommunityBased Developer applicant. Such programs must be open and accessible to the general public, as described in the application. The applicant must demonstrate that the services are generally accessible during core hours/times. For example, an applicant could demonstrate that food distribution services are available based on a set schedule of days and hours.

Please note that some services may greater hours, e.g., medical clinic, or job training services, to be responsive to community needs. ii. For Applicants applying as Community-Based Developers, the entity must demonstrate in their application that they have community knowledge, commitment to long-term community investment, and population-specific cultural competency, through a combination of the following:
• Receipt of grant funds for services within the relevant neighborhood or community.
• Cultural and linguistic competency on staff relevant to community members (must be utilized daily in the provision of services and community benefit programs).
• A record of hiring from the community (within a ten-mile range of the Community-Based Developer’s central office).
• Membership in or recruitment from a local Urban League (or substantially equivalent) organization.

Experience points will not be considered in the ranking of this set-aside; however, the experience point category will be applicable if an application is unsuccessful in the Emerging Developer/Community-Based Developer setaside and is then ranked with the remaining unfunded applications. c. Non-Tax Credit Projects: To the extent possible no less than 15 percent of the total Super NOFA funds, or approximately $97,500,000.
d. Senior: To the extent possible, approximately 20 percent of MHP funds will be awarded for Senior housing Projects in accordance with MHP Guidelines Section 7317(g).

Emerging Developers and Tribal Entities are encouraged to engage with the Department in a pre-application consultation session. Please refer to the Multifamily Finance Super NOFA website for additional information at the following link: PreApplication Intake.

California Department of Housing and Community Development Page 15 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) In the event that any set-aside described under (a)through (d) above is undersubscribed, any remaining funds will be used to assist remaining eligible applications in this NOFA that do not meet the set-aside requirements. See Scoring and Ranking section below for additional funding information.

2. Geographic Distribution of Funds
To the extent possible, the Department will target 44 percent of the total funds to Projects in Southern California, 28 percent to Northern California, and 18 percent to Projects in Rural areas. Ten percent shall not be subject to a specific geographic distribution. In its sole discretion, HCD may determine the geographic distribution targets have been met based either on individual Program funding components or on the amount of total funds awarded under this NOFA.

For the purpose of geographic distribution:
a. Targets are based on the percent of Extremely Low Income and Very LowIncome renters in California, based on the HUD-released data from American Community Survey (ACS) for the 2014-2018 period.
b. "Rural" is defined to be consistent with the definition used by the TCAC for the tax credit program. A list of Rural areas, as well as the methodology to determine Rural or non-rural status, can be found on TCAC’s website or by clicking this link: 2022 Methodology for Determining Rural Status of Project Site (ca.gov).

Northern
Alameda, Butte, Contra Costa, El Dorado, Fresno, Kings, Madera, Marin, Merced, Monterey, Napa, Placer,
Sacramento, San Benito, San Francisco, San Joaquin, San Mateo, Santa Clara, Santa Cruz, Shasta, Solano, Sonoma, Stanislaus, Sutter, Tulare, Yolo, Yuba
Southern Imperial, Kern, Los Angeles, Orange, Riverside, San Bernardino, San Diego, San Luis Obispo, Santa Barbara,
Ventura
Rural
Rural areas as defined by statute, including but not limited to the following 100 percent rural counties: Alpine, Amador, Calaveras, Colusa, Del Norte, Glenn, Humboldt, Inyo, Lake, Lassen, Mariposa, Mendocino, Modoc, Mono, Nevada,
Plumas, Sierra, Siskiyou, Tehama, Trinity, Tuolumne
California Department of Housing and Community Development Page 16 2022 Multifamily Finance Super NOFA (Amended June 10, 2022)

3. Discretionary Funds
Approximately ten percent of the total Super NOFA funds, or $67,500,000, shall be held back as discretionary to facilitate full gap funding of Projects pursuant to this Super NOFA and to achieve a balance of state policy goals.

G. Funding Limits
Use of multiple HCD funding sources on the same Assisted Units is permitted, subject to the following limitations:

1. No more than $35,000,000 in total Rental Housing Development loans may be used per Project.
a. This per Project loan cap applies not only to 2022 Super NOFA awards but to all HCD multifamily Rental Housing Development loan funds for onsite development costs.
i. The $35,000,000 cap will be in place for one year beginning on the day the Super NOFA application closes, July 12, 2022, and subject to renewal.
ii. Awards made prior to the Super NOFA application close date will not be counted towards the $35,000,000 per-Project cap. However, all Super NOFA loan awards, as well as any loan awards from the Department subsequent to the Super NOFA, will count against the $35,000,000 per-Project cap. (See II.G.3. for additional loan and grant limitations.)
iii. Funding limits set forth in section 2 (below) shall not include grants. iv. Prior to the release of the second Super NOFA in 2023, the Department will re-evaluate the HCD-wide loan cap for any needed adjustment.
b. At the sole discretion of the Director of HCD, per-Project loan levels in excess of $35,000,000 may be approved as exceptions to the cap if they uniquely advance state policy priorities. Examples include large development Projects that include transformative community investments and advance climate goals through infill development, high density construction and proximity to transit.
i. To request an exception to the loan cap, the Project Sponsor/Applicant must submit justification prior to their Super NOFA application. Exception requests will be evaluated on a first-come, first-served basis and it is in the Sponsor’s interest to submit justification as early as possible. After justifications are submitted a recommendation from staff will be made based upon the strength of evidence and offered to the Director's Office California Department of Housing and Community Development Page 17 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) for consideration. If approved, Applicants must submit documentation of Department approval with any subsequent Department applications for the applicable Project. A form for outlining the justification of the exception request will be provided by the Department and require evidence of financial necessity.

2. Exceptions to the funding limit in subsection (1)(a) include loans for non-housing related infrastructure, transit amenities, programs, capitalized operating, or operating subsidy reserves.

3. Each Sponsor/Applicant is limited to no more than $80,000,000 in Super NOFA grant or loan awards of any type, excluding any applications awarded in which the Sponsor is a co-Applicant or part of a Joint Venture partnership, Limited Liability Company, or Limited Partnership with an Emerging Developer or Tribal Entity. The per-Sponsor/Applicant Super NOFA award cap is not applicable beyond an individual Super NOFA competition – it is not a cumulative perSponsor/Applicant cap across other HCD NOFA funding opportunities.

4. Total HCD loan and grant funding, including all Super NOFA funds, shall not exceed the following percentages of the total development cost:
• 40 percent for Projects utilizing 9 percent tax credits • 50 percent for Projects utilizing 4 percent tax credits • 75 percent for Projects not utilizing tax credits
In calculating percentage of total development cost, total HCD funding shall be inclusive of both loan and grant awards received at any point in time. Thus, total HCD funding will include prior loan and grant awards, all Super NOFA awards, and shall also be applicable to future HCD awards subsequent to any Super NOFA award.

All Department Funding Sources listed in the HCD Repeal of Stacking Prohibition of Multiple Department Funding Sources Administrative Notice Number: 21-06, are applicable to the percentages of total development cost listed above. The foregoing Administrative Notice is hereby incorporated by this reference to this Super NOFA as if set forth in full herein and shall apply with equal force as all other provisions set forth herein.

At the sole discretion of the Director of HCD, funding levels in excess of the percentages above may be approved as exceptions to the limits if they uniquely advance state policy priorities. Examples include large development Projects that include transformative community investments and advance climate goals through infill development, high density construction and proximity to transit.

To request an exception, the Project Sponsor/Applicant must submit justification prior to their Super NOFA application. Exception requests will be evaluated on a first-come, first-served basis and it is in the Sponsor’s interest to submit justification as early as possible. After justifications are submitted a California Department of Housing and Community Development Page 18 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) recommendation from staff will be made based upon the strength of evidence and offered to the Director's Office for consideration. If approved, Applicants must submit documentation of Department approval with any subsequent Department applications for the applicable Project. A form for outlining the justification of the exception request will be provided by the Department and require evidence of financial necessity.

5. The HCD Repeal of Stacking Prohibition of Multiple Department Funding Source Memo shall remain applicable. A maximum of four HCD Funding Sources comprised of no more than two development loans and two housing-related infrastructure grants may be used on a single Project. Housing related infrastructure grants are those grants provided through the Affordable Housing Sustainable Communities program and also include the following: Housing Related Infrastructure (HRI) grants, Transit-Oriented Development (TOD) Implementation Program - Infrastructure grants, and Infill Incentive Grant Program of 2007 (IIG-2007) and Infill Infrastructure Grant Program of 2019 (IIG2019). a. Within the Super NOFA, the Department will offer loan funding from only one Designated Program (MHP, VHHP, or FWHG) per eligible Unit. The Department will, however, offer funding on previously funded units (i.e. the Department may make a new MHP award on a Unit that has previously received an FWHG award.) However, projects must still comply with the “two-loan, two-grant per Project” rule articulated in the HCD Repeal of Stacking Prohibition of Multiple Department Funding Sources Administrative Notice Number: 21-06. However, Projects must still comply with the “two loan and two grant per Project” rule articulated in Administrative Notice Number 21-06 (Repeal of Stacking Prohibition of Multiple Department Funding Source). Additionally, the Department will not award funding from a specific Super NOFA Designated Program to a Unit that previously received funding from the same program funding source. For example, the Department will not provide MHP funding under the Super NOFA to Units that were awarded MHP funding in a prior MHP round.

6. For Projects assisted by MHP, the number of MHP Assisted Units shall equal the number of Restricted Units to the extent allowed by the requirements of Article XXXIV of the California Constitution, with the exception that Units assisted by a VHHP or FWHG award under the Super NOFA will not be additionally assisted by MHP.

Notwithstanding the above limitations on stacking, at the Department’s discretion, in order to promote Project feasibility, Units assisted by VHHP or FWHG awarded under the Super NOFA may be additionally assisted by MHP in instances where Article XXXIV restrictions limit the Department’s regulatory role.

California Department of Housing and Community Development Page 19 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) Such stacking will occur only in consultation with Project Applicant during the application review period.

For the purpose of calculating loan limits, MHP will loan on any Units restricted to occupancy by households 60% AMI or lower, unless that Unit is also receiving an FWHG or VHHP award under the Super NOFA, in which case the more restrictive AMI targeting will be applicable.

7. Although the exact balance will be driven by the Applicant pool, the Department will strive to ensure that no single MHP Project-type exceeds roughly 50 percent of the total NOFA funds.

H. Cost Limitations
The limits on developer fee are set forth in the applicable Designated Program Guidelines and repeated below for ease of use.
• MHP Guidelines Section 7305: Cost Limitations
• VHHP Guidelines Section 205: Cost Limitations
• FWHG Guidelines Section 206: Cost Limitations
Developer fee limits specified in UMR Section 8312 shall apply, except that:

1. UMR Section 8312(d) shall not apply.

2. For non-tax credit new construction Projects, the total developer fee shall not exceed the following:
a. For Projects with 49 or fewer Restricted Units (excluding Units restricted at levels above 60 percent of AMI): the greater of $40,000 per Restricted/Manager’s Unit or $1,200,000.
b. For Projects with between 50 and 100 Restricted Units (excluding Units restricted at levels above 60 percent of AMI): $2,200,000; and c. For Projects with more than 100 Restricted Units (excluding Units restricted at levels above 60 percent of AMI): $2,200,000 plus $20,000 per Restricted Unit in excess of 100 up to a maximum of $3,500,000. The developer fee in excess of $2,200,000 must be deferred. Payment of deferred developer fee shall be in compliance with UMR Section 8314.

3. For Projects utilizing 4 percent tax credits, developer fee payments shall not exceed the amount that may be included in Project costs pursuant to Title 4 California Code of Regulations (CCR), Section 10327(c)(2)(B); and

4. Joint Ventures or co-Sponsors that include a Tribal Entity or an Emerging Developer that rely on partner to meet the experience requirements of an eligible Sponsor (this does not include contracting without co-ownership pursuant to California Department of Housing and Community Development Page 20 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) section 7303(d)(3) MHP Guidelines), shall have their allowable total developer fee increased according to the following:

a. For non-tax credit Projects, an increase of $300,000 over the limits set forth in (b)(2) (a)-(c) above. Additionally, for Projects with more than 100 Units as defined above in (b)(2)(c), the developer fee paid from sources may increase up to $2,640,000.
b. For Projects utilizing 4 percent tax credits, an increase consistent with Title 4 CCR, Section 10327(c)(2)(E), if eligible pursuant to that section.

I. Threshold
A Project is not eligible for an award unless it meets all the threshold requirements of the applicable Designated Program(s) and IIG-2019. Below is a summary of some of the universal or Program-specific threshold requirements and is not to be considered a complete representation of the entirety of the threshold, or other requirements, terms, and conditions for MHP, VHHP, FWHG, and IIG. Please review the individual Program Guidelines of each Program for complete information.

Further, Sponsors/Applicants must achieve a minimum point score of 85 points in Universal Scoring Criteria to be considered for a funding award.

1. MHP Section 7303.1 Complete Threshold Requirements
All threshold requirements of MHP shall be satisfied. The following listed below are highlights of threshold requirements of MHP that may also apply to other Designated Programs:
• Projects with Special Needs Units shall provide services suitable to the needs of the Special Needs Population; and the application shall demonstrate a specific, feasible plan for delivery and funding of those services, including identification of the Lead Service Provider (LSP), service delivery partners and funding sources, pursuant to Section 7310 and 7314.

2. VHHP Section 202 Complete Threshold Requirements
All threshold requirements of VHHP shall be satisfied. The following listed below are highlights of threshold requirements of VHHP:
• Occupancy is restricted to the greater of 25 percent of total Units in the Project or ten Units to VHHP Assisted Units. At least restrict 50 percent of Assisted Units to Extremely Low-Income Veterans (ELI) and at least 60 percent of these Units must be Supportive Housing Units meeting one of the Homeless subpopulations targeting requirements set forth in 201 (g). • As part of application initial threshold review, meet the requirements specified in the following Sections:

California Department of Housing and Community Development Page 21 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) a. Submission of the VHHP Supportive Services Plan application form b. 201 (k), 201 (l), (LSP) Experience)
c. 214 (b) (1), (formal agreement between LSP and Sponsor) • Ensure compliance with the Disabled Veteran Business Enterprise (DVBE) and Veteran hiring requirements set forth in Section 217 of the VHHP Guidelines.
• The Sponsor must demonstrate confirmation of local need for the Project set forth in Section 201 (p).

3. FWHG Section 204 Complete Threshold Requirements

All threshold requirements of FWHG shall be satisfied. The following listed below are highlights of threshold requirements of FWHG:
• Funding is prohibited for use in housing H-2A (temporary agricultural) workers.

• At least 25 percent of the Units shall be reserved for Agricultural Households. • The Applicant shall document that there is sufficient demand for Agricultural Household Units in the area in which the Project is or will be located as evidenced by a market study.
• Farmworker Need- The maximum number of Projects awarded per County under this Super NOFA shall be based on the presence of farmworkers in the County in which the Project is located based on the most recent U.S. Census of Agriculture (hired farm labor).

Counties
Percentage of
Statewide Hired
Farm Labor
Maximum
Awards Per
County
Fresno, Monterey, Tulare, Santa
Barbara, Ventura, Kern, San
Joaquin, Santa Cruz, Madera,
Merced, Sonoma, Stanislaus, San
Diego, San Luis Obispo, Riverside
3% or more 3
All others Less than 3% 2
California Department of Housing and Community Development Page 22 2022 Multifamily Finance Super NOFA (Amended June 10, 2022)

4. IIG Section 202 Complete Threshold Requirements (for IIG-2007)

All threshold requirements of IIG shall be satisfied. The following listed below are highlights of the threshold requirements of IIG:
• The application must involve an eligible CIP pursuant to section 200. This includes the following requirements, among others, for the QIP:
a. Must meet the definition of a QIP under Guidelines Appendix A Defined Terms.
b. Must include Net Densities on the parcels to be developed that are equal to or greater than the Densities described in section 200. c. Must include not less than 15 percent of the total residential Units to be developed in the QIP as Affordable Units.

5. IIG Section 206 Complete Threshold Requirements (for IIG-2019) IIG-2019 is not one of the Designated Programs and will have slightly different threshold requirements from IIG-2007. A QIP is not eligible for an IIG-2019 award unless it meets all the threshold requirements of the IIG-2019 program set in section 206 of IIG Guidelines.

Please note, however, that the Department will determine threshold eligibility pursuant to Section 206(a)(1)(A) of the IIG Program Guidelines related to housing element compliance at the time of award. Specifically, prior to award, the locality in which the QIP is located must have an adopted housing element that has been found by the Department to be in substantial compliance with the requirements of Article 10.6 (commencing with Section 65580) of Chapter 3 of Division 1 of Title 7 of the GC, pursuant to GC Section 65585 at time of award. If the award decisions are made within 120 days of the housing element due date, the Department may refer to the jurisdiction’s compliance from the prior cycle.

For the purposes of this section alone, jurisdictions that are undergoing Department review of their housing element at the time of award, and jurisdictions which are receiving Department technical assistance to bring their housing element into compliance at the time of award, shall both be deemed to be in a presumptive state of substantial compliance by the Department. All awards premised on presumptive substantial compliance shall include conditions in their respective standard agreements requiring that prior to funds disbursement the subject jurisdiction must have received a final housing element certification letter from the Department.

California Department of Housing and Community Development Page 23 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) J. Scoring and Ranking

1. Scoring Overview
For the purposes of the Super NOFA, all scoring criteria have been outlined in Section III. Universal Scoring of this NOFA. This section details the scoring criteria applicable to all Programs subject to AB 434.

The proposed rating and ranking system aim to accomplish the following goals:
(1) Minimize incentive to apply to multiple programs solely to increase funding levels,
(2) Minimize the number of partially funded Projects,
(3) Ensure that VHHP and FWHG funds are utilized,
(4) Ensure high-quality Projects are awarded, regardless of funding sources requested,
(5) Eliminate subjectivity in rating, ranking, award levels, or award types, (6) Support more efficient use of time and resources, for both Applicants and HCD.

Applications that pass the initial threshold review will be scored using the Universal Scoring Criteria. In the event of tied point scores, HCD shall rank tied applications based on three factors pursuant to the tie-breaker system detailed in the Universal Scoring Criteria: the lowest weighted average affordability of all residential Units, leverage of other funds, and cost containment.

Incomplete applications or others not expected to receive an award of funds due to relatively low scores may not be fully evaluated.

The scoring and tiebreaker contained in the Universal Scoring Criteria is being implemented for the first time in this 2022 Super NOFA, thus the Department recognizes there may be some degree of unpredictability in the outcome of this competition.

2. Ranking Overview
This section provides an overview of the application ranking process and funding order. All applications meeting all the threshold requirements of the applicable Designated Program(s) and IIG-2019 and achieving a minimum point score of 85 points in Universal Scoring Criteria will be considered for funding pursuant to the process described below. Please note, however, that regional targets and setasides will only be funded to the extent that eligible applications (those meeting all threshold requirements including minimum point score) exist. If the Department receives fewer eligible applications than funding available, any unawarded funds within the regional targets or set-asides may be used to fund remaining eligible applications based on ranked score.

California Department of Housing and Community Development Page 24 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) a. Tribal, non-tax credit, and Emerging Developer/Community Based Developer set-asides. Beginning with the top-ranked Projects (according to the Universal Scoring Criteria including tiebreakers as applicable) eligible for a set-aside, the highest scoring set-aside applications will be “fully funded” (provided all applicable threshold, minimum point score, and underwriting criteria are met). “Fully funded” means these applications will receive an award of all requested Program funds, subject to applicable limits. Applicable limits that could result in Department awards below requested levels include but are not limited to maximum allowable loan limits (per Unit, per Project and per Sponsor) and available funding in the 2022 Super NOFA. Applicants that are eligible can compete in multiple set-asides if unsuccessful in one set-aside due to oversubscription (for example, Tribal and non-tax credit).

Experience points will not be considered in the ranking of the Emerging Developer/Community Based Developer set-aside; however, the experience point category will be applicable if an application is unsuccessful in the Emerging Developer/Community-Based Developer set-aside and is then ranked with the remaining unfunded applications.
i. Within the Emerging Developer/Community-Based Developer set-aside, priority will be given to Emerging Developers for approximately one-third of set-aside funds. These Projects will be ranked against each other and funded first. The Department will also prioritize applications under the Emerging Developer/Community-Based Developer set-aside that do not include co-Sponsors/Applicants or Sponsors/Applicants that are part of Joint Ventures.
ii. Projects funded through the set-asides are accounted for in the regions’ percentage targets.
b. Once all set-asides are funded to the extent possible, remaining VHHP applications will be funded as described below, then FWHG, followed by MHP and IIG.

VHHP and FWHG Applicants remaining after the set-asides are funded will be ranked separately according to their score for the Universal Scoring Criteria, including tiebreakers as applicable, until VHHP and FWHG funds are exhausted.

The highest ranking VHHP and FWHG Projects will be fully funded until all VHHP and FWHG funds are exhausted. In other words, highest scoring applications will receive an award of all requested Program funds for which they qualify.
c. When approximately 50 percent of VHHP Program funds have been allocated to Projects located in High/Highest Resource Areas, and approximately 50 percent of FWHG funds have been allocated to Projects located in High/Highest Resource Areas, the Universal Scoring Criteria points for California Department of Housing and Community Development Page 25 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) location in High/Highest Resource Areas will no longer apply, and all remaining Applicants to these two Programs will be awarded based upon their ranking without points for the High/Highest Resource Area location. d. Projects funded through VHHP and FWHG are accounted for in the regions’ percentage targets. Additionally, if a concentration of VHHP or FWHG in any region would make it impossible for the Department to achieve an equitable NOFA-wide geographic distribution, the Department may skip to lower-scoring VHHP and FWHG applications.
e. At the point when VHHP funds are depleted, if the last funded VHHP application requests more VHHP funds than remain, MHP funds may be substituted for the VHHP funds at the sole discretion of the Department, or the application may be partially funded, or the Department may employ a skipping strategy. To qualify for partial funding, the Applicant must have an alternate plan for successfully securing other gap financing that would have been covered by VHHP or FWHG. Partially funded Projects shall have 180 days to secure this gap financing. HCD may grant extensions to this timeframe at its sole discretion.
f. If the last-ranked FWHG application requests more FWHG funds than remain, that Project will receive an augmentation of FWHG funds and be fully funded unless the funding augmentation would be in excess of $15 million. In that case, last-ranked FWHG application may be skipped for the next in line with a smaller request, or the Department may make remaining FWHG funds available in a future NOFA.
g. The remaining Projects will be ranked according to their Universal Scoring Criteria point score and tie-breaker score and fully funded with the remaining MHP and IIG funds, as applicable, until there are no more funds available to fully-fund Projects.
h. However, if the next ranked application according to the Universal Scoring Criteria originally requested VHHP or FWHG (but was not awarded VHHP or FWHG), then the Department at its sole discretion may either partially fund that application or skip to the next-ranked application that did not request VHHP or FWHG. To qualify for partial funding, the Applicant must have an alternate plan for successfully securing other gap financing that would have been covered by VHHP or FWHG. Partially funded Projects shall have 180 days to secure this gap financing. HCD may grant extensions to this timeframe at its sole discretion.
i. The Department may employ the same skipping strategy as described above to achieve the statutorily required MHP allocation to Senior or other housing. j. After MHP and/or IIG funds are largely depleted, if the next-ranked MHP or IIG application requests more MHP or IIG funds than remain in the NOFA, at the sole discretion of the Department, that Project may receive an California Department of Housing and Community Development Page 26 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) augmentation of funds and be fully funded if the augmentation would be $15 million or less. If the augmentation required to fully fund the request would be more than $15 million, the MHP or IIG application may be skipped or partially funded. Partially funded Project(s) will be offered partial funds if they have an alternate plan for successfully securing other gap financing that would have been covered by MHP or IIG. Partially funded Projects shall have 180 days to secure this gap financing. HCD may grant extensions to this timeframe at its sole discretion. If the next ranked partially funded Project(s) are not deemed to have a viable plan for securing other gap financing, then they will be skipped, or the remaining funds will be made available in a future NOFA which includes such Program funding.
k. If there are insufficient applications for MHP, VHHP, FWHG, or IIG funds that meet threshold, scoring, and underwriting requirements, any remaining funds will be made available in a future NOFA.

K. Negative Points and Disencumbrance Policies
The Department’s Negative Points Policy (Administrative Notice Number 2022-01) and Disencumbrance Policy (Administrative Notice Number 2022-02), dated March 30, 2022 and published on the Department’s website, are hereby incorporated by this reference to this Super NOFA as if set forth in full herein, and shall apply with equal force as all other provisions set forth herein.

If the Sponsor/Recipient/Applicant is subject to a negative points assessment based on the criteria outlined in the Department’s Negative Points Policy or is determined to be ineligible for funding, HCD shall notify the Sponsor/Recipient/Applicant in writing in the initial point score letter.

III. Application Submission and Review Procedures
a. Application Submission Process
Applications must meet eligibility requirements upon submission (except as expressly indicated in the Guidelines). See Program Requirements above for eligible Sponsors/Applicants, eligible Projects, and eligible uses of funds. Applications that do not meet the filing deadline requirements will not be eligible for funding.

Applications must be on HCD’s forms and cannot be altered or modified by the Applicant. It is the Applicant’s responsibility to ensure the application is clear, complete, and accurate. Excel forms must be submitted in Excel format, not a PDF document.
b. Electronic Submission
Application materials must be submitted electronically via the SNAP Portal.

Requirements for uploading the universal Super NOFA application and required supporting documentation, including naming conventions, are described in the Super California Department of Housing and Community Development Page 27 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) NOFA application instructions page. Applicants must upload all application materials to the SNAP Portal no later than 4:00 p.m. Pacific Daylight Time on July 12, 2022. c. Application Workshops and Pre-Application Consultation HCD will conduct three in-person workshops and two recorded webinars for the Super NOFA. Please visit the Multifamily Finance Super NOFA website for the dates and registration information. Pre-application consultations are also available and can be requested by contacting [email protected].

D. Disclosure of Application
Information provided in the application will become a public record available for review by the public pursuant to the California Public Records Act (Gov. Code, § 6250 et seq.). As such, any materials provided are subject to disclosure to any person making a records request under this Act. HCD cautions Applicants to use discretion in providing information not specifically requested, including, but not limited to, bank account numbers, personal phone numbers and home addresses.

By providing this information to HCD, the Applicant is waiving any claim of confidentiality and consents to the disclosure of submitted material upon request.

E. Concurrent Applications
Due to the unique circumstances of the current challenging funding environment, the Department will allow Super NOFA Applicants to pursue more than one funding scenario. This means that a separate, concurrent application to other HCD Program funding source(s) is permitted under this Super NOFA. These Applicants, however, MUST submit within each application a disclosure of all HCD applications under review or anticipated to be submitted. All anticipated applications with NOFAs subsequent to the Super NOFA application due date must be disclosed to Super NOFA staff no later than September 30, 2022. In addition, Applicants must notify Super NOFA Program staff via the Super NOFA mailbox at the time the second application is submitted ([email protected]). Submission of concurrent Super NOFA applications proposing 4 percent and 9 percent tax credits, as well as submitting a Super NOFA application proposing 4 percent tax credits and submitting a 9 percent application in TCAC’s second 2022 round, is prohibited.

In instances where such Applicants are competitive for an award, the Department will also engage in consultation with Applicants to discern which funding scenario(s) are optimal for Project feasibility while balancing cost containment. However, it is the Department’s intent to avoid any possibility of over-subsidizing.

In the absence of compelling reasons to do otherwise, HCD’s approach for Super NOFA Applicants will be to reduce the Super NOFA award commensurately with any amounts awarded under another HCD program.

California Department of Housing and Community Development Page 28 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) F. Prior Awards
Applicants seeking to substitute previously awarded funds, including but not limited to substitutions in order to increase the amount of an award, must first withdraw their previous award in writing and provide reasonable justification that the substitution is necessary to ensure Project feasibility. A consultation with Department Program staff is required at the time of the withdrawal. Substitutions based solely upon Sponsor/Applicant preference or convenience will not be permitted. However, it is allowable for Applicants that wish to retain their previous award to apply for another funding source available within this Super NOFA, so long as the previous award is unmodified. In this case, the Department will also allow previously awarded Projects to lower their proposed income targets from one application to the next, so long as the total Unit count remains the same. The Department will restrict Units to the lowest targeting across all awarded funds and will require Projects awarded from a Program with prioritized Target Populations to maintain the special population Units (increasing Target Population and/or Restricted Units is permitted). However, for Projects proposing a reduction to AMI levels on the Unit mix, the awardee must engage with Program staff of their prior award and confirm the change does not impact Project feasibility and would not cause a reduction in awarded funds pursuant to that Program’s requirements. This consultation process must begin no later than June 1, 2022.

G. Significant Changes in Project After Application
The Department will review, and score based on information provided in the application. If there is a significant departure from the application, the Department may re-evaluate the Project’s score, reduce loan or grant amount, or assign negative points to the Sponsor/Applicant.

IV. Universal Scoring Criteria
A. Summary
The criteria detailed below and summarized in the following table shall be used to rate applications:

Universal Point Score Criteria
(Used in Project ranking separate from Threshold Review) Criterion Maximum Score Universal Scoring Criteria
Extent to Which the Project Serves Households
at the Lowest Income Levels 30
State Policy Priorities 17
Project Sponsor and Property Management
Experience 20
California Department of Housing and Community Development Page 29 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) B. Extent to which the Project serves households at the lowest income levels (30 points maximum)
Applications will be scored based on the percentage of Restricted Units limited to various percentages of AMI, adjusted by household size, and as follows:

1. A maximum of 30 points will be awarded based on the Lowest Income Points Table below.

2. The “Percent of AMI” category may be used only once. For instance, 50 percent of Restricted Units at 50 percent of AMI cannot be used twice for 100 percent of Units at 50 percent AMI and receive 25 points, nor can 50 percent of Restricted Units at 50 percent of AMI for 12.5 points and 40 percent of Restricted Units at 50 percent of AMI be used for an additional 10 points. However, the “Percent of Restricted Units” may be used multiple times. For example, 50 percent of Restricted Units at 50 percent of AMI for 12.5 points may be combined with another 50 percent of Restricted Units at 45 percent of AMI to achieve the maximum points.

3. Point values that are only available to Projects in Rural Areas are marked with an asterisk.

Lowest Income Points Table
Percent of AMI
Percent of
Restricted
Units
55% 50% 45% 40% 35% 30% 25% 20% &
below
50% 5* 12.5* 16.9 17.5 18.75 30 30 30
45% 5* 11.25* 16.9 17.5 18.75 30 30 30
Project Readiness 20
Adaptive Reuse / Infill / Proximity to
Amenities / Sustainable Building Methods 21
Cost Containment 5
Total Possible Universal Points 113
California Department of Housing and Community Development Page 30 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) 40% 5* 10 15 17.5 18.75 27.5 30 30
35% 4.4* 8.75 13.15 17.5 18.75 25 27.5 30
30% 3.75* 7.5 11.25 15 18.75 22.5 25 30
25% 3.15* 6.25 9.4 12.5 15.65 18.75 21.9 25
20% 2.5* 5 7.5 10 12.5 15 17.5 20
15% 1.9* 3.75 5.65 7.5 9.4 11.25 13.1 15
10% 1.25* 2.5 3.75 5 6.25 7.5 8.75 10
To receive any points in this category, at least 10 percent of the Restricted Units must be restricted to households with incomes not exceeding 30 percent of AMI.

Deeply Affordable Units under this paragraph (2) - those Units with up to 30 percent AMI targeting - cannot be concentrated among a Project’s smaller Units.

They must be distributed proportionately across all Unit sizes, or, alternately, more heavily represented among larger Units. To ensure a proportional spread of deeply Affordable Units, at least 10 percent of the larger Units in the Project must be provided at 30 percent of AMI, as applicable. So long as the Applicant meets the 10 percent standard Project-wide, the 10 percent standard need not be met among all the smaller Units.

Example:
60 Total Units in Project Required ELI Units
(30% AMI)
18 three-bedroom 2 Units
21 two-bedroom 3 Units
21 one-bedroom 1 Unit
Total (10%) 6 Units
California Department of Housing and Community Development Page 31 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) In Projects that rely on renewable project-based rental assistance contracts to maintain Fiscal Integrity consistent with the targeted income limits (and associated tenant Rents), scores will be based on the applicable income and Rent limits.

C. State Policy Priorities (17 points maximum)

1. Five points will be awarded for Projects located in a “High Resource” or “Highest Resource” Area as shown on the TCAC/HCD Opportunity Area Map

MHP Senior Projects do not qualify for High/Highest Resource Area points unless they also qualify as MHP Special Needs Projects with at least 25 percent Department-restricted Special Needs Units. These may also qualify under the MHP Senior set-aside if they meet the eligibility requirements under MHP Guidelines section 7302(e)(2).

Once Projects receiving 5 points pursuant to paragraph (1) have been ranked according to the scoring criteria and as further described in a NOFA and recommended for award in the amount of 50 percent of all Program funds available in a NOFA, remaining Projects shall not receive 5 points for meeting the requirements of this paragraph.

To the extent possible, the Department will aim to achieve 50 percent High and Highest Resource Area Projects under VHHP and FWHG-funded Projects.

An Applicant may choose to utilize the applicable census tract, or census block group, or resource designation from the TCAC/HCD Opportunity Area Maps in effect when the initial site control (pursuant to UMR section 8303(a)) was obtained up to seven calendar years prior to the application.

2. Total Percentage of Super NOFA-funded8 Units Serving Special Needs Populations, Agricultural Households (10 points maximum) Chronically Homeless, Homeless via CES9 Other Special
Needs, Agricultural Households
Total percent of Super NOFA-funded Units Points
25%+ 10 points
16-24% 9 points
10-15% 8 points
8 Super NOFA-funded Units means a request of funding for Units by the Designated Program(s) under this Super NOFA. This does not include any Units funded under a prior round of any program funding. 9 Coordinated Entry System (CES) California Department of Housing and Community Development Page 32 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) Note: Per Threshold Criteria for FWHG, the Project shall meet the minimum percent of Assisted Units as defined in each NOFA. See NOFA for current minimum percent of Agricultural Household Assisted Units. Also see VHHP Guidelines Section 201 (f) through (i) for VHHP subpopulation threshold percentages.

Under this category, applications requesting IIG Program funds only and no other Super NOFA funds will automatically receive 10 points.

Under this category, Rehabilitation Projects are scored differently from new construction. Rehabilitation Projects will automatically receive 10 points. To receive these points, the Project shall maintain any Chronically Homeless, Homeless, other Special Needs, and Agricultural Households population restrictions pursuant to an existing Regulatory Agreement, deed restriction, or similar encumbrance. Any existing income, Rent, and population restrictions must be documented in the application. No permanent relocation shall be permitted unless reviewed and approved by the Department.

Rehabilitation Projects must also meet the following conditions:

a. The Project qualifies as At High Risk or involves the conversion of single occupancy Units without kitchens and/or bathrooms to Units with kitchens and bathrooms; and
b. The contract for Rehabilitation work equals or exceeds $60,000 per Unit in hard construction costs. Hard construction costs mean costs included in a construction contract but excluding general requirements, profit and overhead.

3. Public Excess Lands (2 points maximum)
Two points will be awarded if a new construction Project is located on a site selected under Executive Order N-06-19 to enter into a ground lease with the state to create affordable housing on excess state-owned property.

D. Project Sponsor/Applicant and Property Management Experience (20 points maximum)
NOTE: For applications requesting IIG funds only, Applicant experience is evaluated. For applications requesting IIG plus another Designated Program funds (e.g., MHP), Applicant experience is evaluated for IIG, and Sponsor experience is evaluated for MHP (in this example, Applicant and Sponsor may or may not be the same entity).
“Projects” as used in paragraph (1) and (2) below means Rental Housing Developments of over ten Affordable Units that are subject to a recorded Regulatory Agreement, or, in the case of housing on Indian Country, where federal HUD funds California Department of Housing and Community Development Page 33 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) have been utilized in affordable rental developments. Points in paragraphs (1) and (2) will be awarded in the highest applicable category and are not cumulative. For points to be awarded in paragraph (2), an enforceable management agreement executed by both parties for the subject application must be submitted at the time of application.

By applying for and receiving points in these categories, Applicants certify that the property shall be owned and managed by entities with equivalent experience scores for the entire Regulatory Agreement period.

1. Development and Ownership Experience. Applications will be scored based on the number of subsidized rental housing Projects (including tax credit Projects) that the Sponsor/Applicant has completed and operated and whether the Sponsor/Applicant is subject to penalties pursuant to paragraph (3) below.

For completed Projects, a Sponsor/Applicant may include the experience of its controlled affiliated entities or its principals (e.g., employed by, and under the control of the Sponsor/Applicant and responsible for managing development activities), but not the experience of non-management board members. A Sponsor/Applicant may include the experience of a partner (e.g., Joint Venture partners pursuant to Appendix A of the Guidelines) to gain experience points; however, the experienced partner must have a controlling interest in the Project’s ownership and a substantial and continued role in the Project’s ongoing operations, as evidenced in the organizational documents for the owner.

Experience among partners shall not be aggregated. Any change in the ownership that reduces the Sponsor’s/Applicant’s role shall require prior written approval by the Department.

If a Sponsor/Applicant relies upon the experience of its Principal for scoring, documentation of the Principal’s experience is required as set forth in the NOFA and application.

The experience of an Emerging Developer’s principal shall not be used to qualify an Emerging Developer Sponsor/Applicant for maximum development and ownership experience points. An Emerging Developer cannot have developed, owned, or operated more than three (3) Affordable Housing Developments. If the experience of an Emerging Developer’s principal is used for scoring and exceeds three (3) Affordable Housing Developments, the Sponsor/Applicant does not meet the qualifications of an Emerging Developer.

To receive points under this paragraph the following conditions must be met:

a. Submit a certification that the Projects for which points are requested have maintained Fiscal Integrity for the year in which each Rental Housing Development’s last financial statement has been prepared, a positive operating cash flow from typical residential income alone and have funded reserves in accordance with the partnership agreement and any applicable loan documents.

California Department of Housing and Community Development Page 34 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) To obtain points for Projects previously owned, a certification must be submitted with respect to the last full year of ownership by the Sponsor/Applicant, along with verification of the number of years that the Project was owned by that Sponsor/Applicant. To obtain points for Projects previously owned, the ending date of ownership or participation must be no more than ten years from the application deadline.

Points are available as follows:
3-4 projects in service more than 3 years, of which 1 shall be in service more than 5 years and 2 shall be Departmentregulated or projects utilizing low-income housing tax credits allocated by TCAC
10 points
5 or more projects in service more than 3 years, of which 1 shall be in service more than 5 years and 2 shall
be Department-regulated or projects utilizing low-income housing tax credits allocated by TCAC

15 points
For Special Needs Projects or Community-Based Developers only with experience serving Target Population(s) proposed to be served in the application, points are available as described above or as follows:

For Special Needs projects:
• 4 or more Special Needs Projects in service more
than 3 years, of which 1 shall be Departmentregulated or a project utilizing low-income housing tax credits allocated by TCAC.

For Community-Based Developers:
• 4 or more projects in service more than 3 years, of
which 1 shall be Department-regulated or a project
utilizing low-income housing tax credits allocated by
TCAC.

The property manager shall have three or more years’
experience serving the Target Population(s) proposed to be served in the application.
15 points
Pursuant to Section 7303 of the MHP Guidelines, Applicants with fewer than four active Rental Housing Developments in service more than three years shall contract with a bona-fide management company which itself earns a minimum total of five Property Management Experience points at the time of application.
b. To obtain development and ownership experience points, Tribal Entities, Community-Based Developers or Emerging Developers may contract with California Department of Housing and Community Development Page 35 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) a Developer who will not be the Project owner and may receive points commensurate with the Developer’s experience pursuant to (a) above.

For purposes of this subparagraph only, a Developer is defined to include an entity pre-approved by the Department that has developed but not owned the requisite number of projects described in (a above and that provides the certification described in (a) above for the projects for which experience points are requested. If the projects for which the entity requests experience points do not include two Department-regulated projects in service more than three years, the Tribal Entity shall also contract with a bona-fide management company which itself earns a minimum total of 5 Property Management Experience points at the time of application. For this purpose, only, “develop” shall mean developing the project scope and timeline, securing financing, hiring, or performing the services of a general contractor, and overseeing completion of construction and placement in service as well as asset managing the project for at least three years after construction completion.

When seeking the Department’s pre-approval, the entity shall provide fully executed copies of contracts demonstrating the Department’s criteria for “develop” as specified above have been met.

The contract shall be in effect at least until the Project’s stabilized occupancy (90 percent occupancy for single room occupancy (SRO) and Special Needs Projects and 95 percent for all other projects), completion of all permanent loan closings, and achievement of all stabilization milestones of the Project’s ownership agreement. Tribal Entities exercising the option under this subparagraph (B) to contract with a Developer for these experience points shall also contract for asset management for at least the term of the 15-year federal compliance period with an entity that has provided three years of asset management for at least two Department-regulated Projects.

2. Property Management Company Experience. To receive points under this paragraph, the property management company must meet the following conditions:
a. To obtain points for projects previously managed, the ending date of the property management role must be no more than ten years from the application deadline. In addition, the property management experience with a project shall not pre-date the project’s construction completion date.

Points are available as follows:
6-10 projects managed over 3 years, of which 2 shall
be Department-regulated or projects utilizing low-income housing tax credits allocated by TCAC
3 points
California Department of Housing and Community Development Page 36 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) 11 or more projects managed over 3 years, of which 2
shall be Department-regulated or projects utilizing lowincome housing tax credits allocated by TCAC 5 points
For Special Needs Projects and for Community-Based Developers, points are available as described above or as follows:

For Special Needs projects:
• 4 or more Special Needs Projects in service more
than 3 years, of which 1 shall be Departmentregulated or a project utilizing low-income housing tax credits allocated by TCAC.

For Community-Based Developers:
• 4 or more projects in service more than 3 years, of
which 1 shall be Department-regulated or a project
utilizing low-income housing tax credits allocated by
TCAC.
5 points
When contracting with an experienced property management company under the terms of paragraphs (1) or (2) above, the Sponsor/Applicant or property co-management entity must obtain training in: project operations, on-site certification training in federal fair housing law, and manager certification in Internal Revenue Code (IRC) Section 42 Low Income Housing Credit Program requirements from a CTCAC-approved, nationally recognized entity. Additionally, the experienced property management agent or an equally experienced substitute, must remain for a period of at least three years from the construction completion date (or, for ownership transfers, three years from the sale or transfer date) to allow for at least one HCD monitoring visit to ensure the Project is in compliance with HCD requirements for inspection and monitoring contained in the Regulatory Agreement. Thereafter, the experienced property manager may transfer responsibilities to the remaining general partner or property management firm following formal written approval from HCD.

3. Negative Points – An application will be assessed negative points based on one or more of the following:
a. Performance penalties assessed pursuant to the Department’s Negative Points Policy (Administrative Notice Number 2022-01), dated March 30, 2022, as may be amended from time to time.

If the Applicant is subject to a negative points assessment based on the criteria outlined in the Department’s Negative Points Policy or is determined to be ineligible for funding, HCD shall notify the Applicant in writing in the initial point score letter.

California Department of Housing and Community Development Page 37 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) b. VHHP applications where the Project Sponsor was involved in a previously funded VHHP Project(s) where there was a failure to make good faith efforts to hire Veterans for development, construction, and related jobs associated with the Project pursuant to Section 217 of the VHHP Guidelines.

Negative points will be assessed as a reduction to the score earned under paragraphs (1) and (2) above and will serve as the final score for this criterion. For example, if a Project earns 15 points under paragraph (1) Development and ownership experience and 5 points under paragraph (2) Project Management Company Experience but is assessed 3 negative points, the final score for this criterion would be 17 (15 + 5 - 3).

If the Sponsor/Applicant is subject to negative points assessment, HCD shall notify the Sponsor/Applicant in writing within the point score letter and will provide opportunity to appeal negative points assessment pursuant to the appeals process as set forth in the NOFA.

E. Project Readiness (20 points maximum, negative 5 points maximum) Points will be awarded to Projects under each of the following rating factors as documented in the application and as indicated below. If a particular rating factor is not applicable, full points shall be awarded in that category.

1. Financing Commitments (10 points maximum)
a. Five points will be awarded for evidencing Enforceable Funding Commitments for all construction financing, excluding: funds applied for under this NOFA, an allocation of tax-exempt bonds, and 4 percent or 9 percent tax credits. For Projects with bond financing, lender commitment of bond financing is required for these points.
b. Five points will be awarded for evidence of Enforceable Funding Commitments for all permanent financing, grants, project-based rental assistance, and operating subsidies, excluding: funds applied for under this NOFA, an allocation of tax-exempt bonds, and 4 percent or 9 percent tax credits. For Projects with bond financing, any applicable permanent lender commitment of bond financing is required for these points.

For both construction financing commitments and permanent financing commitments, the assistance will be deemed to be an Enforceable Funding Commitment as this term is defined in Appendix A of the Guidelines, if it has been awarded to the Project or if the Department approves other evidence that the assistance will be reliably available. Contingencies in commitment documents based upon the receipt of an allocation of tax-exempt bonds, 4 percent tax credits or 9 percent tax credits will not disqualify a source from being counted as committed.

California Department of Housing and Community Development Page 38 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) To receive points under paragraphs (a) and (b) above for deferred payment financing, grant funds, or subsidies from other Department programs, these funds must be awarded prior to finalizing the preliminary point scoring of applications under this NOFA.

2. Local and Environmental Approvals (7 points maximum) a. Land use approvals (5 points maximum) – Points will be awarded under either item i, ii, or iii below.
i. Five points will be awarded for obtaining all land use approvals or entitlements necessary prior to issuance of a building permit, including any required discretionary approvals. Notwithstanding this requirement, design review, variances, and development agreements are not required to be completed. Project sites where the planning department confirms eligibility for streamlined ministerial approval (including but not limited to the Senate Bill 35 (2017) Streamlined Ministerial Approval Processing) are eligible for these points.

For Projects located within city limits where a FEMA Major Disaster Declaration has been made up to three years preceding the application due date, these 5 points will be awarded for certification that all necessary land use approvals or entitlements necessary prior to issuance of a building permit will be completed within 90 days of award.

For Projects located outside of city limits where a FEMA Major Disaster Declaration has been made and the local government responsible for land use approvals or entitlement review is not a city, the Applicant must, in addition to providing this certification, demonstrate to the Department’s satisfaction that the Project contributes to providing housing for disaster-impacted households.
ii. Four points will be awarded for submission of a complete application to the relevant local authorities for land use approval under a Nondiscretionary Local Approval Process, where the application has been neither approved nor disapproved.
iii. One point will be awarded for a letter signed by a planner certified by the American Institute of Certified Planners indicating that, in their opinion, the Project meets all of the requirements for approval under a Nondiscretionary Local Approval Process, where an application has not been approved or disapproved by the local authorities.

California Department of Housing and Community Development Page 39 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) b. Environmental Approvals (2 points maximum) – Points will be awarded for local certification of CEQA (California Environmental Quality Act) exemption or completion.

For Projects located within city limits where a FEMA Major Disaster Declaration has been made up to three years preceding the application due date, these 2 points will be awarded for certification that the Project is exempt from CEQA or that the CEQA review will be completed prior to the issuance of the Department’s standard agreement for funds under this NOFA. For Projects located outside of city limits where a FEMA Major Disaster Declaration has been made and the local government responsible for environmental review is not a city, the Applicant must, in addition to providing this certification, and demonstrate to the Department’s satisfaction that the Project contributes to providing housing for disaster-impacted households.

For Projects receiving federal funds subject to review under the National Environmental Policy Act (NEPA), a copy of the Project’s Authority to Use Grant funds must be provided prior to the construction loan closing. It is not necessary to have the Authority to Use Grant Funds at application stage.

3. Organizational Documents (3 points maximum) – Points will be awarded if the ultimate borrowing entity or IIG-only Recipient, including all affiliated entities, is fully formed and all required organizational documents are submitted with the application.

4. TCAC Hybrid Projects Five points will be subtracted for a Project utilizing lowincome housing tax credits that will be part of an application to TCAC seeking hybrid tiebreaker incentives.

F. Adaptive Reuse / Infill / Proximity to Amenities / Sustainable Building Methods (21 points maximum)
Applications will receive 5 points for each of paragraphs (1), (3), (4) and 6 points for paragraph (2) of the following four conditions, up to a maximum of 21 points as defined below:
• Infill development and Net Density
• Proximity to amenities
• Broadband access
• Sustainable building methods

1. Infill development and Net Density. Five points will be awarded for infill development, including adaptive reuse of a vacant and underutilized nonresidential building located in a developed area served with public infrastructure.

The Project must meet one of the following requirements of (a) or (b) below:

California Department of Housing and Community Development Page 40 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) a. Located on a site where either:
i. At least 75 percent of the site was previously improved (including areas where improvements have been demolished) or used for any use other than Open Space, agriculture, forestry, or mining waste storage; or ii. At least 75 percent of the perimeter of the site’s adjoining parcels that are developed with Urban Uses (residential, commercial, industrial, public institutional, transit or transportation passenger facility use, or retail use, or any combination of those uses) but not including lands used for agricultural uses or parcels in excess of 15,000 square feet in size and containing only one single family residence, or is separated from parcels that are developed with Urban Uses only by an improved public right-of-way. In calculating this percentage, perimeters bordering navigable bodies of water and improved Parks shall not be included; or iii. The combination of at least 50 percent of site area as previously improved (including areas where improvements have been demolished) or used for any use other than Open Space, agriculture, forestry, or mining waste storage, and at least 50 percent of the perimeter of the site adjoining parcels that are developed with Urban Uses or is separated from parcels that are developed with Urban Uses only by an improved public right-of-way. In calculating this percentage
perimeters bordering navigable bodies of water and improved Parks shall not be included.
b. Developed at average residential Net Densities on the parcels to be developed that are greater than the densities described below:
i. For an incorporated city within a nonmetropolitan county and for a nonmetropolitan county that has a micropolitan area:  sites allowing at least 20 Units per acre.
ii. For an unincorporated area in a nonmetropolitan county not included in clause (i):  sites allowing at least 15 Units per acre. iii. For a suburban jurisdiction:  sites allowing at least 25 Units per acre. iv. For a jurisdiction in a metropolitan county:  sites allowing at least 45 Units per acre.
v. For a Rural Area: sites allowing at least 15 Units per acre.

2. Proximity to amenities. Maximum of 6 points, may combine options under (a) and (b):
a. Projects will receive 1/3 point per site amenity point that would be awarded under TCAC Regulations, Title 4 CCR, Division 17, Chapter 1, California Department of Housing and Community Development Page 41 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) Section 10325(c)(4)(A) or successor regulation (In TCAC regulations, this is a 15-point category, however, achieving all 15 points under TCAC translates to 5 points under this category).

Transit points must be for a Transit Station or Major Transit Stop and distance must be measured by a Walkable Route.
b. Projects within one-quarter mile of a Transit Station or Major Transit Stop shall receive 1 point.

These transit points shall be measured by a Walkable Route from the nearest boundary of the Project to the outer boundary of the site of the Transit Station or Major Transit Stop.

3. Broadband access. Five points will be awarded for Projects meeting the following requirements:
a. Residential dwelling Units that can accommodate broadband service with at least a speed of 100 megabits (50 megabits for rural) per second for downloading and 20 megabits per second (10 megabits for rural) for uploading. Internet service (and its ongoing fee) is not required; and b. The application includes a plan for reducing barriers to access for Project residents. The plan should be tailored to the needs of the tenant population and may include Programs providing free or reduce internet prices; reasonable access to Project facilities, computers, and shared Wi-Fi; and computer and Wi-Fi literacy training and technical assistance.

4. Sustainable building methods. Points will be awarded based on the following (up to a maximum of 5 points):
a. 2.5 points will be awarded if the Project supports the implementation of a sustainable community’s strategy or alternative planning strategy that has been determined by the California Air Resources Board to achieve the region's greenhouse gas emissions target or other adopted regional growth plan intended to foster land use. Consistency with such plans must be demonstrated by a letter or resolution executed by an officer or an equivalent representative from the metropolitan planning organization, regional transportation agency, planning, or local transportation commission. b. If a sustainable community’s strategy is not required for a region by law, 2.5 points will be awarded if the Project supports a regional plan that includes policies and programs to reduce greenhouse gas emissions. Evidence of consistency with such plans must be demonstrated by a letter or resolution executed by an officer of, or an equivalent representative from, the metropolitan planning organization or regional transportation planning agency or local transportation commission.

California Department of Housing and Community Development Page 42 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) c. A Project in which not less than 50 percent of the land area is within a Transit Priority Area shall receive 2.5 points. Evidence of Project location within, or partially within, a Transit Priority Area must be demonstrated by a letter or resolution executed by an officer of, or an equivalent representative from, the metropolitan planning organization, regional transportation planning agency, or local transportation commission.
d. Five points will be awarded for a Project that is designed to achieve green building status beyond State mandatory building code requirements as verified upon construction completion by a certified LEED Green rater, certified Green Point rater, or licensed engineer. Applicants may select from the following green building certification programs:

Program Minimum Required Tier or
Designation
CalGreen Tier 2
U.S. Green Building Council
LEED Certification Gold
Green Point Rated New Construction: Gold
Rehabilitation: Whole Building
ENERGY STAR Certified Home
Living Future Challenge Living Building
e. Three points for Projects that achieve near electrification – Projects where two out of three of the major energy appliances (cook stoves, space heating, water heating) are electric. Projects must be wired to be electric-ready, defined as having 240 volts outlets near each gas appliance. f. Five points will be awarded for Projects that are powered entirely through electricity with no connections to natural gas infrastructure.

G. Cost Containment—5 points maximum
A Project shall receive 1 point for each full percent that the Project's eligible basis is less than the Project's adjusted threshold basis limit, up to a maximum of 5 points.

The percentage is calculated by dividing the project’s eligible basis by the Project’s adjusted threshold basis limit.

Total Eligible Basis per the Development Budget
Adjusted Threshold Basis Limit
(Per California Debt Limit Allocation Committee
(CDLAC) Regulation Section 5230)
For purposes of this subdivision, a Project's adjusted threshold basis limit shall be the Project's threshold basis limit, as if it were a 4 percent LIHTC project, as California Department of Housing and Community Development Page 43 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) determined pursuant to Section 10327(c)(5) of the TCAC regulations, except that the increase for deeper targeting pursuant to Section 10327(c)(5)(C) of the TCAC regulations that is multiplied by the unadjusted threshold basis limit shall be limited to 80 percent. Section 10327(c)(5) of the TCAC regulations states that for Projects financed through CDLAC, “an increase of one percent in the threshold basis limits shall be available for every 1 percent of the project's Low-Income and Market Rate Units that will be income and rent restricted at or below 50 percent but above 35 percent of AMI. An increase of 2 percent shall be available for every 1 percent of the project's Low-Income and Market Rate Units that will be restricted at or below 35 percent of AMI. In addition, the applicant must agree to maintain the affordability period of the project for 55 years (50 years for projects located on Tribal Trust Land).” The Department, however, will only restrict to income levels in 5 percent increments.

Any Project may be subject to performance penalties if the Project’s total eligible basis determined upon construction completion exceeds the revised total adjusted threshold basis limits for the year the Project completes construction (or the original total eligible threshold basis limit if higher) by 40 percent.

H. Tiebreaker Score
In the event of tied point scores, the Department shall rank tied applications based on three factors which will be added together for a final tiebreaker score. The three factors are: (1) the lowest weighted average affordability of all residential Units, (2) leverage of other funds, and (3) additional cost containment. The tiebreaker scoring calculation is explained below. Although the exact balance will be driven by the Applicant pool, the Department will strive to ensure that no single MHP Project-type exceeds roughly 50 percent of the total NOFA funds.

1. Lowest weighted average affordability of all residential Units. a. Multiply each income limit applicable to the Project by the number of adjusted residential Units restricted at that income level (market rate Units, which do not include Units subject to Rent and/or occupancy restrictions at 70 percent or 80 percent AMI, shall be designated 100 percent AMI). Unrestricted Manager’s Unit(s) are excluded from this calculation.

To calculate adjusted residential Units, multiply the residential Units of a Unit Type (bedroom count) by the following adjustment factors:

Unit Type Adjustment Factor
Studio/SRO 0.90
1-Bedroom 1.00
2-Bedroom 1.25
3-Bedroom 1.50
4-Bedroom or larger 1.75
California Department of Housing and Community Development Page 44 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) For purposes of this calculation:
• Units with federal project-based rental assistance shall be assigned targeted Rent levels of 30 percent AMI regardless of their actual income targeting; and
• If the average affordability of all unadjusted residential Units, exclusive of Units with rental assistance, is less than 40 percent AMI, then the calculation shall assume a targeted Rent level of 40 percent AMI for each residential Unit that does not have rental assistance.
b. Add the products calculated pursuant to the previous paragraph. c. Divide the sum calculated pursuant to the previous paragraph by the total number of adjusted residential Units in the Project to obtain the average affordability.
d. Subtract (c) from 1.0.

2. Leverage of other funds.
a. Applications will be scored based on the leverage of other soft funds, meaning local public funds, including land donations or fee waivers to be used for permanent funding of the development costs attributable to the Restricted Units as a percentage of the total Project development cost. b. Land donations will be counted as leveraged funds where the value is established with a current appraisal, with the amount discounted to reflect a purchase price that is lower than the appraised value, or any fees, or other reliably predictable payments required as a condition of the donation. c. The capitalized value of Rent differentials attributable to public project-based rental or public operating subsidies, based upon TCAC underwriting standards. Standards shall include the following and shall be annually aligned with TCAC standards for these capitalized values to the extent possible: a 15-year loan term; an interest rate based upon a spread over 10-year Treasury Bill rates; a 1.15 to 1 debt service coverage ratio; and a five percent vacancy rate.

The rental income differential for subsidized Units shall be established by subtracting rental income at 40 percent AMI levels (30 percent AMI for Special Needs Project types with project-based rental assistance) from the committed contract Rent income documented by the subsidy source. In the case of a USDA rental subsidy only, the contract Rent income is the higher of 60 percent AMI rents or the committed contract USDA Basic rents. The committed contract Rent income for Units with existing project-based Section California Department of Housing and Community Development Page 45 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) 8 rental subsidy shall be documented by the current monthly contract Rent in place at the time of the application or by contract Rent committed to and approved by the subsidy source (HUD); Rent from a Rent comparable study or post-Rehabilitation Rent shall not be permitted.

The Rent differential for Projects with public operating subsidies shall equal the annual subsidy amount in year one, provided the subsidy will be of a similar amount in succeeding years, or the aggregate subsidy amount of the contract divided by the number of years in the contract if the contract does not specify an annual subsidy amount.
d. Add the sum of all eligible soft funds as set forth in paragraphs (a), (b) and (c).
e. Divide (d) by total Project development cost and express as a decimal.

3. Additional Cost Containment. The “additional cost containment” category for the Tiebreaker follows the same methodology as the Cost Containment scoring category above, in Scoring Category G. This factor is calculated by dividing the Project’s eligible basis by the Project’s adjusted threshold basis limit as illustrated below:

For purposes of this subdivision, a Project's adjusted threshold basis limit shall be the Project's threshold basis limit, as if it were a 4 percent LIHTC Project, as determined pursuant to Section 10327(c)(5) of the TCAC regulations, except that the increase for deeper targeting pursuant to Section 10327(c)(5)(C) of the TCAC regulations that is multiplied by the unadjusted threshold basis limit shall be limited to 80 percent. Section 10327(c)(5) of the TCAC regulations states that for Projects financed through CDLAC, “an increase of one percent in the threshold basis limits shall be available for every 1% of the Project's LowIncome and Market Rate Units that will be income and rent restricted at or below 50 percent (50%) but above thirty-five percent (35%) of Area Median Income (AMI). An increase of two percent (2%) shall be available for every 1% of the Project's Low-Income and Market Rate Units that will be restricted at or below 35% of AMI. In addition, the Applicant must agree to maintain the affordability period of the Project for 55 years (50 years for Projects located on tribal trust land).” The Department, however, will only restrict to income levels in 5 percent increments.

Percentages shall not include any percentage points requested or awarded (up to 5 percent) pursuant to the Cost Containment point category. The maximum percentage shall be 25 percent.

Total Eligible Basis per the Development Budget
Adjusted Threshold Basis Limit
(Per CDLAC Regulation Section 5230)
California Department of Housing and Community Development Page 46 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) Note: Any Sponsor may be subject to future performance penalties if the Project’s total eligible basis determined upon construction completion exceeds the revised total adjusted threshold basis limits for the year the Project completes construction (or the original total eligible threshold basis limit if higher) by 40 percent.

The calculation in this paragraph (3) is multiplied by 0.75.

V. Appeals
A. Basis of Appeals

1. Upon receipt of HCD’s written notice that an application is incomplete, has failed threshold review, or has otherwise been determined to provide an insufficient basis for an award (including point scoring and tie breaker), Applicants under this Super NOFA may appeal such decision(s) to the Director of the Department or their designee pursuant to this section.

2. No Applicant shall have the right to appeal a decision of HCD relating to another Applicant’s application (e.g., eligibility, award).

3. Any request to appeal HCD’s decision regarding an application shall be reviewed for compliance with the Guidelines and this Super NOFA. All decisions rendered shall be made by the Director or his/her designee. The decision shall be final, binding, and conclusive, and shall constitute the final action of HCD.

4. The appeal process provided herein applies solely to decisions of HCD made pursuant to this Super NOFA.

B. Appeal Process and Deadlines

1. Process: To file an appeal, Applicants must submit to the Director of the Department or their designee, by the deadline set forth below, a written appeal which states all relevant facts, arguments, and evidence upon which the appeal is based. Furthermore, the Applicant must provide a detailed reference to the area or areas of the application that provide clarification and substantiation for the basis of the appeal. No new or additional information will be considered if this information would result in a competitive advantage to an Applicant. Once the written appeal is submitted to HCD, no further information of materials will be accepted or considered thereafter. Appeals are to be submitted to HCD at [email protected] according to the deadline set forth in HCD review letters.

2. Filing Deadline: Appeals must be received by HCD no later than five business days from the date of HCD’s threshold review, or initial score letters, as applicable, representing HCD’s decision made in response to the application.

C. Decision
California Department of Housing and Community Development Page 47 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) Any request to appeal HCD’s decision regarding an application shall be reviewed for compliance with the Guidelines and this Super NOFA. All decisions rendered shall be final, binding, and conclusive, and shall constitute the final action of HCD.

VI. Award Announcements and Contracts
A. Award Announcements
HCD will announce Program awards on the Multifamily Finance Super NOFA website.

B. Contracts
Successful Sponsors/Applicants (awardee(s)/Recipient(s)) will enter into one or more Standard Agreements with HCD. The Standard Agreement contains all the relevant state and federal requirements, as well as specific information about the award and the work to be performed.

A condition of award will be that a Standard Agreement must be executed by the awardee(s) within 90 days (Contracting Period) of HCD’s issuance of the award letter. Failure to execute the Standard Agreement(s) within the contracting period may result in award cancellation. The awardee(s) shall remain a party to the Standard Agreement for the entire term of the Standard Agreement; removal of the awardee(s) without prior HCD consent is prohibited and will result in a default.

Once a Project is awarded HCD funds, the Sponsor/Recipient is acknowledging the Project as submitted and approved is the Project that is to be funded and built. Any bifurcation would make that award null and void, as the awarded Project is no longer feasible as originally submitted and awarded funds are unable to be assumed or assigned.

VII. Other State Requirements
The Sponsor/Recipient agrees to comply with all applicable state and federal laws, rules, guidelines, and regulations that pertain to construction, health and safety, labor, fair employment practices, equal opportunity, and all other matters applicable to the Rental Housing Development, the Sponsor/Recipient, its contractors or subcontractors, and any loan or grant activity, including without limitation the following:
• MHP Guidelines Section 7314: State and Federal Laws, Rules, Guidelines and Regulations
• VHHP Guidelines Section 303: State and Federal Laws, Rules, Guidelines and Regulations
• FWHG Guidelines Section 303: State and Federal Laws, Rules, Guidelines and Regulations
California Department of Housing and Community Development Page 48 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) • IIG Guidelines Section 300: State and Federal Laws, Rules, Guidelines and Regulations
Where the proposed Project type presents a fair housing issue (e.g., MHP senior housing, FWHG housing), the Department reserves discretion to require a fair housing legal opinion.

A. Article XXXIV
All Projects subject to Article XXXIV shall comply with Article XXXIV, Section 1 of the California Constitution, as clarified by the Public Housing Election Implementation Law (PHEIL) (Health & Safety Code, § 37000 - 37002). Article XXXIV documentation for loans underwritten by HCD shall be subject to review and approval by HCD prior to the announcement of award recommendations.

Article XXXIV requires local voter approval before any state public body can develop, construct, or acquire a low-rent housing project in any manner. However, the PHEIL provides clarification as to when Article XXXIV is applicable. HSC section 37001, for example, lists a number of project types that are not considered “low-Rent housing projects.”
Applicants must submit documentation that shows the Project’s compliance with or exemption from Article XXXIV. If a Project is subject to Article XXXIV, the HCD requires an allocation letter from the Local Public Entity that shows that there is Article XXXIV authority for the Project. A local government official with authority should prepare the allocation letter, and it should include the following:

1. The name and date of the proposition and the number of Units that were approved,

2. A copy of the referendum and a certified vote tally,

3. The number of Units that remain in the Local Public Entity’s “bank” of Article XXXIV authority (i.e., the number of Units that are still available for allocation); and

4. The number of Units that the Local Public Entity will commit to this Project, including the Manager’s Unit.

If a Project is statutorily exempt from Article XXXIV, then HCD requires an Article XXXIV opinion letter from the Applicant’s legal counsel. The Article XXXIV opinion letter must demonstrate that the Applicant has considered both the legal requirements of Article XXXIV and the relevant facts of the Project (e.g., all funding provided by public bodies, including state, county, or city sources; the number of Low-Income restricted Units; and the general content of any regulatory restrictions).

Any conclusion that a Project is exempt from Article XXXIV must be supported by facts and a specific legal theory for exemption that itself is supported by the Constitution, statute, and/or case law.

California Department of Housing and Community Development Page 49 2022 Multifamily Finance Super NOFA (Amended June 10, 2022) B. California’s Preservation Notice Law
All Applicants, Sponsors, co-Sponsors, owners, and special purpose entities must, at all times, comply with, and not be in violation of, California’s Preservation Notice Law (Gov. Code, §§ 65863.10, 65863.11, 65863.13).

C. Relocation
The Sponsor/Recipient of a Project resulting in displacement of persons, businesses, or farm operations shall be solely responsible for providing the assistance and benefits set forth in the Designated Program Guidelines section indicated below, and in applicable state and federal law, and shall agree to indemnify and hold harmless HCD from anyliabilities or claims for relocation-related costs.
• MHP Guideline Section 7315: Relocation Requirements
• VHHP Guideline Section 304: Relocation Requirements
• FWHG Guidelines Section 304: Relocation Requirements
• IIG Guidelines Section 301: Relocation Requirements
VIII. Other Terms and Conditions
A. Right to Modify or Suspend
HCD reserves the right, at is sole discretion, to suspend, amend, or modify the provisions of this Super NOFA at any time, including without limitation, the amount of funds available hereunder. If such an action occurs, HCD will notify all interested parties via HCD’s email list and will post the revisions to the IIG website. Please be sure and subscribe to HCD’s email list.

B. Conflicts
It is the duty and responsibility of the Applicant and Sponsor to review any funding source they obtain for a Project to ensure each of the requirements for those funding sources are compatible with HCD program requirements
In the event of any conflict between the terms of this Super NOFA and Guidelines and either applicable state or federal law or applicable regulation, the terms of the applicable state or federal law or applicable regulation shall control. Applicants are deemed to have fully read and understand all applicable state and federal laws, regulations, and guidelines pertaining to the relevant program, and understand and agree that HCD shall not be responsible for any errors or omissions in the preparation of this Super NOFA.