Department of Neighborhood Development
Housing Policy --- Section 11
Homeless Housing Set-Aside
DND requires rental housing developments with ten (10) units or greater to include a minimum set-aside of ten percent (10%) of the rental housing units for homeless families and/or individuals with an income no greater than thirty percent (30%) of the Area Median Income adjusted for household size (the "Set-Aside Units").
Policy (Language to be included in Loan Agreement and Affordable Housing Restriction)
Number and Type of Set-Aside Units: Projects including ten (10) or greater rental housing units must include a minimum set-aside of ten percent (10%) of the rental housing units for Homeless Households. The distribution by bedroom size of the Set-Aside Units must be proportional to the overall configuration to and disbursed throughout the project, unless otherwise approved by DND.
Eligible Participants: "Homeless Households", as defined by DND in the "Homeless Set-Aside Procedures", shall be eligible for occupancy in Set-Aside Units. In limited circumstances and with prior approval from DND, the Borrower may lease a Set-Aside Unit to a "Formerly Homeless Household", as defined by DND. In order to be approved for a Set-Aside Unit subsidized under the Section 8 Project Based Assistance (PBA) program, the Homeless Household must be determined eligible for Priority One status as outlined in the Boston Housing Authority's (BHA) Administrative Plan.
Clearinghouse: The Department of Neighborhood Development (DND) has contracted with HomeStart, Inc., a Boston-based housing organization, to serve as a Clearinghouse for the Set-Aside Units. As such, HomeStart monitors leasing activity and provides information and outreach to potential applicants and referral sources for the Set-Aside Units. HomeStart also has capacity to provide limited stabilization services to Homeless Households for up to one year after placement.
Outreach: The Borrower is responsible to ensure that adequate and appropriate outreach is done to identify eligible Homeless Households for the Set-Aside Units. For Non-Section 8 Project Based Assisted Units, the Borrower may elect to fill vacant units solely with applicants referred from HomeStart or they may outreach to and accept referrals from the community including, but not limited to health and social service providers and homeless and housing organizations. For projects utilizing Section 8 Project Based Assisted (PBA) units from the Boston Housing Authority (BHA), the Borrower shall accept applications only from the BHA to fulfill the Set-Aside requirement.
Tenant Screening and Selection: The Borrower shall adopt tenant screening and selection criteria that recognizes the unique circumstances of Homeless Households and appropriately mitigates negative aspects associated with homelessness and/or the Household's past housing history.
Leasing the Set-Aside Units: With regard to new construction rental housing developments, or those that are rehabilitation projects which contain existing vacancies, the Borrower must first fill the Set-Aside Units until the obligation has been satisfied. When a project is fully occupied and there is an existing waiting list, the Borrower has the option to fill the every other vacant unit with applicants from the existing waiting list. However, the Set-Aside obligation must be fully met within three (3) years.
Turnover: Should any Homeless Set-Aside Unit become vacant, then that unit shall continue to be considered part of the Set-Aside and must be released to a Homeless Household with an income no greater than thirty percent (30%) of the Area Median Income adjusted for household size. With DND approval, the Borrower may elect to substitute a different unit so long as the minimum obligation is maintained.
Rent Guideline: Initial rents for the Homeless Set-Aside Units shall not exceed thirty percent (30%) of the median income for a household earning thirty percent (30%) of the Area Median Income adjusted for household size. All Set-Aside Units must be underwritten to serve this population.
Tenant Based Subsidy: The Borrower may lease a Homeless Set-Aside Unit to a Homeless Household receiving assistance under a tenant based rental subsidy program, provided that the Household meet all other eligibility guidelines. The Household may pay no more than 30% of the adjusted income toward their total housing cost.
Section 8 Project Based Subsidy: The Borrower may utilize Section 8 Project Based Assistance subsidies in order to meet the Homeless Set-Aside requirement. However, if the request for Section 8 PBA subsidies is rejected, the Borrower remains obligated to meet the Homeless Set-Aside requirement.
View the Homeless Set-aside Procedures.
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