Property Management PERMANENT SUPPORTIVE HOUSING - The Florida Housing Finance Corporation - Florida Housing Coalition
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PERMANENT SUPPORTIVE HOUSING
Property Management
GUIDEBOOK
SPONSORED BY: PRESENTED BY:
The Florida Housing The Florida Housing Coalition
Finance Corporation June 2018
INTRODUCTION...............................................................................................................................2
PART I: Planning a Permanent Supportive Housing Community...............................................................3
Choices and Decisions
Rehabilitation or New Construction
Rehabilitation
Capital Needs Assessment
New Construction
Property Characteristics
Size and scale of property
Target population
Ownership and Management Structure
Property Management: In-house or Outsource?
Safety and Security Considerations
Building Consensus, Support, and Momentum
Board of Directors
Support Service Providers
Local government leadership, planning and housing staff
The Development Team
The Technical Advisor
PART II: Developing a Permanent Supportive Housing Community........................................................11
Predevelopment
Selecting a Co-Developer
Site Location Criteria
Areas of Opportunity
Proximity Considerations
Due Diligence Process for Site Selection
Market Analysis
Legal Consultation
Financing Process
Credit Underwriting
Funding Award and Initial Closing
Construction and Lease-Up
Project Stabilization and Final Closing
Period of Affordability
Compliance Monitoring
Regulatory Agreement / Land Use Restriction Agreement
PART III: Managing and Operating a Permanent Supportive Housing Development...............................18
The Property Management Plan
Staff Organization
Organization Chart
Property Management Policies
Leasing Policies
Maintenance and Repair Policies
Operating Procedures
Operation in Compliance with Financing Requirements
Operating Budget and Reserves
Set-asides and Unit Mix
PE R M ANE NT SUPPOR T IV E HOUSING | PR OPE R T Y M ANAGEMENT GUI D EBO O K
Income Limits
Rent Limits
Rental Assistance
Utility Allowances
Tenant Eligibility
Financial Management
Fair Housing
General Fair Housing Requirements
Marketing
Reasonable Modifications and Reasonable Accommodations
Affirmative Fair Housing Marketing Plan
Support Services
Administrative Procedures
Compliance Monitoring
Reporting Requirements
Record Retention and Access
Staff Training
PART IV: Support Services in Permanent Supportive Housing...............................................................28
Introduction
Separation of Property Management and Support Services
Voluntary Service Provision
Service Provision Models
Contracting Support Services
Training and Competencies in Support Services
Funding for Support Services
Documentation and Privacy Issues
APPENDIX I: Resources...................................................................................................................34
APPENDIX II: Glossary.....................................................................................................................35
APPENDIX III: Due Diligence............................................................................................................37
APPENDIX IV: Property Management Plan Template...........................................................................39
FLORIDA HO U S I N G COA L I T ION | WWW. F L HO U S IN G.OR G
WHAT IS
Permanent Supportive Housing?
Permanent supportive housing (PSH) is an evidence-based hous-
ing model that combines affordable permanent housing with
access to flexible supportive services. Supportive housing is de-
signed for people with disabilities who are unlikely to be able to
maintain stable housing without service-enriched housing. This
combination of affordable housing and individualized support
services helps individuals live healthier, more stable lives.
Typically, supportive housing is rental housing with a standard lease. The PSH
apartments may be scattered through the community in mainstream apart-
ment complexes or may be project-based rental units in one or more devel-
opments. In some cases, permanent supportive housing apartments are set-
aside units in larger affordable subsidized housing complexes.
Combined with the rental housing are the individualized, flexible, and acces-
sible supportive services. These services may vary widely and often include
case management, health care coordination, behavioral health coordination,
job and education coaching, assistance with daily living skills, transportation
assistance, and assistance accessing mainstream resources such as food as-
sistance and disability income.
Permanent supportive housing for those with disabilities not only saves lives
and provides a platform for health and wellness, it also results in cost savings
to public service systems.
PE R M ANE NT SUPPOR T IV E HOUSING | PR OPE R T Y M ANAGE M E NT GUI D EBO O K 1
Introduction
Affordable housing development begins with an idea or, for some, a vision. Bringing that vision to life starts with
exploring choices, making decisions, and taking action. The same can be said about the permanent supportive
housing (PSH) model. Permanent supportive housing is often more deeply affordable than general affordable hous-
ing and offers a permanent private residence in which to thrive – a very different, and much more effective, approach
as compared to a congregate setting, an institution, and or an emergency shelter.
The idea or vision for PSH includes not only stable and helpful for those who may be developing or operating
affordable housing, but the supports needed to main- PSH without FHFC financing because the basic tenets
tain housing stability for a lifetime. The visionaries who of good management and quality support services ap-
strive to become developers and operators of perma- ply to any PSH project or program.
nent supportive housing have a special challenge to not
This guidebook describes the steps and milestones
only make the home a reality, but to integrate the com-
required to bring the initial concept of permanent
munity-based supportive services needed by house-
supportive housing to successful development and
holds with disabling conditions who tend to have expe-
sustainable operation. The ultimate goal, of course, is
rienced housing instability or homelessness.
to position your project to provide a permanent resi-
The primary purpose of this guidebook is to provide dence for people who have faced serious challenges
a tool to assist you in the operation and maintenance in finding a home that meets their needs for accessibil-
of permanent supportive housing, including basic ity, affordability, and supports.
management operations, as well as the coordination
The guidebook was prepared by the Florida Housing
and delivery of support services. Part I of this guide
Coalition, a statewide nonprofit organization whose
is focused on the advance planning of a permanent
mission is to bring together housing advocates and re-
supportive housing project-based multifamily devel-
sources so that all Floridians have a quality affordable
opment. Part II focuses on predevelopment and de-
home and suitable living environment. The Florida
velopment activities to build a quality project-based
Housing Coalition provides training, consulting, and
PSH development. In Part III, we highlight the oper-
technical assistance services in permanent supportive
ating and property management approaches and ac-
housing, as well as in community development, ending
tions that qualify the PSH project property for afford-
homelessness, affordable housing, and much more.
able housing development financial assistance. Part IV
Contact us if you have questions or stories to share!
rounds out the PSH project framework by providing an
overview of how to integrate into the project the sup- Permanent supportive housing links decent, safe, af-
port services needed – those that will enable tenants fordable, community-based housing with flexible, vol-
with histories of housing instability or homelessness to untary support services designed to help the house-
achieve housing stability and wellness, even while liv- hold stay housed and live a more productive life in the
ing with disabling conditions. community. It looks and functions much like any other
brand of housing. People living in supportive housing
This guidebook is sponsored by the Florida Housing
have a private and secure place to make their home,
Finance Corporation (FHFC) to help applicants for de-
just like other members of the community, with the
velopment financing to understand FHFC’s policies and
same rights and responsibilities. The difference is that
regulations governing program design, operation, and
they can access, at their option, services designed to
compliance for permanent supportive housing. While
build independent living and tenancy skills, assistance
applicants for funding may include for profit and non-
with integrating into the community, and connections
profit organizations, or joint ventures between both,
to community-based health care, treatment, and em-
the guidance is primarily directed to the nonprofit, mis-
ployment services. (USICH)
sion-based organization. The guidebook will also be
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PART ONE
Part I
Planning a Permanent Supportive
Housing Community
Choices and Decisions • Is it right for our organization?
As an organization contemplates the possibility of de- • Will this project further the mission, vision, and
veloping and operating permanent supportive hous- strategic plan of our organization?
ing, it is helpful to begin with a framework for exploring • Does our organization have the time, capacity,
the project concept and consider the overall process of and resources to launch a development project?
making initial decisions through the development pro- • Is there a clear picture of the need and demand
cess. It is important to understand the complexity of this for the type of housing being considered?
type of housing, including the long term legal, financial, • Can the project be built as designed and be op-
and operational obligations that are involved. erated with the intended rent levels expected
from the intended residents, or will fundraising
This section outlines the choices and decisions that and grantwriting be required as a permanent ac-
are followed by pre-development, development and tivity to successfully operate the housing? If the
management of permanent supportive housing. The latter, does our organization have the capacity to
development of affordable housing is a complex and ensure success in those arenas?
time-consuming process. It is essentially multifamily real • What specific type of project would be appro-
estate development, made more complicated by the priate for our organization and most compatible
many strings attached from the source(s) of financing with our mission?
and regulatory constraints. • A single site project such as an apartment
complex?
The graphic below shows the general sequence of the • Scattered site housing such as geographically
development of affordable housing, from concept to dispersed individual units detached or attached,
lease up and operation. that are leased with rental or other subsidies?
• Unit set-asides in an affordable housing proj-
The initial decision to pursue the development and opera-
ect where the owner designates a specific
tion of permanent supportive housing is contingent upon number of units for persons with disabilities or
the consideration of several basic but essential questions. special needs?
o Conceptual Vision
The Development
o Site Selection
o Programming/Preliminary Design
o Funding Application
PROCESS
o Credit Underwriting
o Funding Award and Initial Closing
o Construction and Lease-Up
o Project Stabilization and Final Closing
o Project Operation and Program Compliance
PE R M ANE NT SUPPOR T IV E HOUSING | PR OPE R T Y M ANAGE M E NT GUI D EBO O K 3PART ONE
While the residence type may vary, the common element • How will the community respond to the planning
in permanent supportive housing is independent living and construction of the project?
with voluntary supports that are not provided by the • Who will be the development team? Do the
property manager. Permanent supportive housing does team members have experience in developing
not include shelters, transitional housing, group homes, the type of project under consideration?
assisted living facilities, any other congregate setting, or
other specialized licensed residential facilities. Rehabilitation or New Construction
There are many other elements that require decisions Rehabilitation
during the conceptual phase of a permanent support- In some cases, an organization may have access to an
ive housing project. These additional considerations, existing property. Once the concept is fully explored,
along with an assessment of available resources and it must be determined if that property is suitable for the
opportunities, will shape the outcome of the project. project in mind.
The age, condition, and configuration of the property
• Will this be new construction or acquisition and
must be carefully considered. A capital needs assess-
rehabilitation of an existing structure?
ment will probably be required by funding sources if
• What is the size and scale of the property? the organization is considering rehabilitating an exist-
• What are the locational criteria for the project? ing building. Whether by donation or purchase, exist-
• Who is the target population? ing buildings must be thoroughly inspected.
• What are the roles of the principals (i.e., owner, General considerations include the following.
developer, manager, or a combination)?
• Is the building location optimal to serve the needs
• How will we ensure safety and security of the of the residents?
residents and staff?
• Is the rehabilitation cost effective when
• Will property management be performed in compared to either demolition and
house or will a third party professional property reconstruction or acquisition of a new site and
management company be engaged? new construction?
• How will the project support the intended
population?
While the residence type may vary, the common element in permanent supportive housing is
independent living with voluntary supports
that are not provided by the property manager. Permanent supportive housing does not
include shelters, transitional housing, group homes, assisted living facilities,
any other congregate setting, or other specialized licensed residential facilities.
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The table below describes the specific considerations that should be made for acquiring and rehabilitating an
existing building.
Considerations for Existing Buildings as
Suitable for Permanent Supportive Housing Development
ENVIRONMENTAL Pre-1978 buildings may have asbestos or lead based paint on site.
Hazardous materials in construction Testing and remediation will be required. This should be done at the
or vicinity including soils. Water and outset of the due diligence process to determine if there will be a
air quality, noise or light pollution. severe cost impact or delay.
STRUCTURAL CONDITION The Capital Needs Assessment will entail examinations by an
Foundation, interior structure, exte- engineer who must evaluate the condition of the building including
rior coverings, roofing, doors, and code violations or upgrades that will be required.
windows.
MECHANICAL SYSTEMS The Capital Needs Assessment process will evaluate the age esti-
Heating, air conditioning, ventilation, mated useful life of mechanical systems. The report should include
ductwork. a replacement analysis that is tied to capital reserves set aside for
future repairs or replacement.
ENERGY EFFICIENCY & RESILIENCY Existing buildings should be tested for energy efficiency in the
Utilities costs affect both tenant and equipment and building envelope. A blower door test or other
landlord. Consider renewable energy techniques indicate the treatments required to optimize energy
and wind-hazard mitigation. efficiency.
HISTORIC PRESERVATION The rehabilitation of designated historic structures can require ad-
Historic buildings have significance at ditional review and approval as well as rehabilitation methods that
the local, state or federal level. They protect and respect the integrity of the resource.
add to the character and ambience of
a neighborhood and possess unique
architectural features that are desir-
able and aesthetic.
SECURITY The site itself and the surrounding area should be considered for
security features to provide safety for a vulnerable population.
PAVING AND DRAINAGE The site should be evaluated for the efficiency of drainage systems
on and immediately offsite. Existing paving and curbing condition
should be considered for replacement.
CODE COMPLIANCE Determine if the use of the property is compliant with current codes and
if the structure and property configuration conform to current codes.
ADAPTIVE REHABILITATION When converting from a non-residential use to a residential use, be
aware of life safety code variations, the suitability of the building for
housing, and the experience of the development team in the com-
plex process of adaptive re-use.
ACCESSIBILITY Existing buildings may not provide accessibility features critical in
serving persons with disabilities. The renovation must meet and pos-
sibly exceed ADA standards to serve the needs of the intended resi-
dents. Rehab projects financed by FHFC are required to conduct an
ADA compliance analysis.
PE R M ANE NT SUPPOR T IV E HOUSING | PR OPE R T Y M ANAGE M E NT GUI D EBO O K 5PART ONE
Capital Needs Assessment ings that are 1, 2, or 3 stories with or without an eleva-
A Capital Needs Assessment (CNA) is prepared fol- tor. A mid-rise is from 4 to 6 stories, while a high-rise is 7
lowing an inspection of the property and results in a or more stories. In both a mid-rise and high-rise, an ele-
written evaluation of the property condition. The study vator is required in each building. There are also smaller
provides a minimum cost estimate for items requiring scale options that could include single scattered site
immediate attention. In addition, the study should pro- properties, duplexes, triplexes, or quadraplexes.
vide a schedule for the costs of future replacement of
Many developers choose to have mixed uses on site,
mechanical systems so that reserve accounts can be
such as commercial space or services on the ground floor
capitalized both at the time of completion and during
with residences above. It is also possible to choose to in-
operation. All rehabilitation projects to be financed by
clude mixed incomes (i.e., a certain percentage of units
FHFC require a CNA.
for those with moderate incomes and the remainder for
The plan should address the following issues. low income households). Mixed income developments
• Analysis of structural components can provide the property owner higher rental income
• Health and safety issues and further the goal of integrating those with special
needs into the mainstream. The development of a mixed
• Accessibility features and deficiencies
income community requires flexible financing to be able
• Environmental hazards to serve both very low and higher income residents.
• Remaining useful life of mechanical systems and
major structural components Whether large or small, high-rise or garden, scattered
site or an apartment complex, it is important that the
New Construction setting be integrated into the community. Residents
Most financing for the development of permanent sup- should not be segregated or concentrated. While the
portive housing tends to favor new construction. New- housing itself has safety, affordability and accessibility,
ly built properties typically result in lower maintenance residents should also have easy access to the commu-
and capital costs, as well as higher energy efficiency. nity for employment, recreation, education, shopping,
Further, accessibility features are part of the design and services, and worship.
can include the latest in assistive technology.
The number of units and the unit size are also important
Considerations for new construction include the to consider in the conceptual stages. To some degree
following. the number of units and unit sizes are a reflection of the
• Has it been determined that there are no existing type of supportive housing contemplated. For exam-
properties available that would be suitable for ple, if the target population is persons who have expe-
the project under consideration?
rienced chronic or long-term homelessness and have
• Is land available that would be readily prepared a disabling condition, then a larger scale project with
for the intended use?
one-bedroom units might be the best configuration.
• Does the development team have experience in Housing that will serve adults with developmental dis-
new construction of affordable housing?
abilities may consider a shared living model with one,
two, and three-bedroom units with space for a live-in
Property Characteristics caregiver. Scattered site single family homes may be a
Size and Scale of Property good choice for supported independent living for fam-
There are many choices when considering the size and ilies with special needs.
scale of a permanent supportive housing project. A
project with fewer than 30 units is considered small, Target Population
while 30 to 60 units would be medium, and more than Permanent supportive housing may serve a relatively
60 would be large. The most common configuration is broad spectrum of residents. The common element
“garden style,” which may include one or more build- is that supportive housing serves households who
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(1) are low income and (2) have special needs that with disabling conditions requiring support services to
such that the household requires support services remain stably housed, and may be focused on a special
to remain stably housed. People who are moving subpopulation, as follows.
out of homelessness and have disabling conditions People living with special needs or disabling condi-
generally fall into the very low-income or extreme- tions may include a target subpopulation, such as:
ly low-income category. If a household has not yet
• People moving out of homelessness
been awarded disability support income, they may
have no income at all. • Survivors of domestic violence
• Seniors
Housing that costs no more than 30 percent of house-
• Foster youth aging out of the child welfare
hold income for low income persons is often not avail-
system
able outside of public housing. For example, a person
• Veterans
whose sole income is $750 from Supplemental Security
Income (SSI) would typically have to spend 100 percent Ownership and Management Structure
of their income on housing in the private market and still The developer must consider the ownership structure
might not have access to the supports needed to main- it will form. The development of affordable housing
tain stability in the community. often requires a combination of team members, each
of whom brings specialized resources essential to the
As with the locational considerations, the developer
success of the project, both in completion of develop-
must evaluate financing choices and make decisions
ment and long-term operation. Affordable permanent
based on the population it will serve. Most organiza-
supportive housing is subsidized by public and private
tions have one or more target populations defined with-
sources each with expectations on the compliance and
in their mission, vision, and core values statements. The
sustainability of operations.
target population should comprise those who are living
PE R M ANE NT SUPPOR T IV E HOUSING | PR OPE R T Y M ANAGE M E NT GUI D EBO O K 7PART ONE
There are four primary roles comprising the team:
According to the FHFC (Florida Nonprofit Organization as Owner. The nonprofit owner may pro-
Housing) Compliance Guide- vide land, equity, development oversight, and community good-
book, it is the owner’s responsi- will. An experienced high-capacity nonprofit may not only be the
bility to obtain Florida Housing’s owner, but also the developer, property manager, and provider of
approval for the management supportive services, or any combination of those roles.
company selected to manage the
Developer. The developer is responsible for securing financing,
development. This requirement
credit underwriting, construction oversight, and completion. The
is in addition to the review of the
developer may remain in the project as a co-owner or investor.
management company informa-
tion by the credit underwriter. Property Manager. The property manager takes responsibility for
The owner shall advise the Asset marketing the property, lease-up, move in, move out, rent collec-
Management Staff of Florida tions, evictions, accounting, supervision of maintenance, routine
Housing of any change in the reporting to owner, compliance, and monitoring. The property
owner’s selection of a manage- manager may be a contracted third party or may be a division with-
ment company; any such new in the ownership structure.
management company shall be
approved by Florida Housing pri- Support Services Provider. While it is sometimes the case that the
or to the firm assuming responsi- owner also takes responsibility for support services, it is more often
bility for the development. true that the owner relies on third party service providers to work
directly with residents to ensure they have access to services. Even
The management company and when most services will be provided by third parties, a support ser-
all on-site personnel are respon- vices coordinator should be on the staff of the owner.
sible to the owner for imple-
Property Management: In-House or Outsource?
menting the applicable Regu-
The ongoing success of any affordable housing property is directly re-
latory Agreement and program
lated to the quality of its property management services. Permanent
requirements correctly. Anyone
supportive housing projects that receive financing from FHFC have
who is authorized to lease apart-
strict requirements for experienced property management. FHFC re-
ment units to residents shall be
quires the preparation of a Management Plan that identifies the role
thoroughly familiar with each
of the property manager and the role of support coordinators. As dis-
federal and state law, rule, or
cussed in more detail later, permanent supportive housing requires a
regulation governing certifica-
separation between property management and the provision of sup-
tion and leasing procedures. It is
port services. This distinction is important and must be designed into
also important that the manage-
the management plan with routine reviews.
ment company provide infor-
mation, as needed, to Florida Developers and owners who are just getting started in this arena will be
Housing and submit all required required to hire an outside qualified property management company.
reports and documentation in a In Florida, third party professional property management requires a Real
timely manner. It is recommend- Estate Brokerage license. FHFC requires a property manager to have
ed that a management company managed at least two properties similar in size and type as the proposed
representative attend Man- permanent supportive housing project. As the entity gains experience,
agement Reviews and Physical the owner may bring management in-house if approved by FHFC. In-
Inspections conducted by the house management by the owner does not require a brokerage license.
monitoring agent. (Section 2.3) The choice to manage in-house will depend on the availability of qualified
staff and a strong web-based property management tracking program.
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According to the FHFC (Florida Housing) Compliance Safety and Security Considerations
Guidebook, it is the owner’s responsibility to obtain The safety and security of residents is of utmost impor-
Florida Housing’s approval for the management com- tance in the management of supportive housing. De-
pany selected to manage the development. This re- pending on the size of the property and characteristics
quirement is in addition to the review of the manage- of the residents, security can be handled in a variety of
ment company information by the credit underwriter. ways. A professional security analyst should be asked to
The owner shall advise the Asset Management Staff of provide a plan with the type of systems recommended.
Florida Housing of any change in the owner’s selection It is important to include the anticipated costs of securi-
of a management company; any such new management ty in the operating budget estimates. Security methods
company shall be approved by Florida Housing prior to may include any of the following, or other options.
the firm assuming responsibility for the development. • Remotely monitored cameras
The management company and all on-site personnel are • On-site 24-hour monitoring of camera feeds
responsible to the owner for implementing the applica- • Locked entrance with attendant
ble Regulatory Agreement and program requirements • Unattended locked entrance
correctly. Anyone who is authorized to lease apartment
In addition, each apartment should have security fea-
units to residents shall be thoroughly familiar with each
tures that would be appropriate to ensure the unit is
federal and state law, rule, or regulation governing cer-
safe and accessible.
tification and leasing procedures. It is also important
that the management company provide information, Building Consensus, Support, and Momentum
as needed, to Florida Housing and submit all required Once the organization has settled on a basic concept,
reports and documentation in a timely manner. It is rec- it is important to gain confidence in the overall feasibil-
ommended that a management company representative ity of the concept so that it can be further defined. The
attend Management Reviews and Physical Inspections development of permanent supportive housing does
conducted by the monitoring agent. (Section 2.3) not happen simply as a result of a building sketch and
The property manager must be knowledgeable and raising some money. There are dozens of relationships
capable of being responsible for the following basic that must be cultivated and maintained to bring all of
requirements. the pieces together to accomplish the stages of devel-
opment and operation.
• Marketing
• Application intake, with support coordinator Board of Directors
assistance to applicants as appropriate The development of permanent supportive housing re-
• Income qualification and annual re-certification, quires an informed board of directors that has reached
if required by financing source a consensus on the concept and the decision to move
• Move-in and move-out procedures forward. Board members should be invited to participate
• Eviction procedures consistent with Florida law in the concept development phase and understand their
(F.S. Chapter 83) role going forward in guidance and direction. The board
• Maintenance of buildings, grounds, and com- should also be kept apprised of all activities and provid-
mon areas ed routine reports and updates. Many of the engage-
• Accounting ments that will be required in planning and financing the
• Tracking and reporting for annual monitoring development will require a board resolution in approval.
• Annual inspection of units, with assistance from
Support Service Providers
support staff as appropriate
It is important to inform and seek input from the network
• Monitoring schedule and compliance with of appropriate support service providers and, if target-
financing requirements
PE R M ANE NT SUPPOR T IV E HOUSING | PR OPE R T Y M ANAGE M E NT GUI D EBO O K 9PART ONE
ing those moving out of homelessness, the Continuum The Development Team
of Care. The successful management of the housing will The formation of the development team should start
depend on the availability of support services to help early in the process. If your organization is not expe-
tenants stabilize housing and achieve goals of health rienced in development of this type, you will need an
and wellness. This topic is covered in more depth in experienced co-developer. Other members of the team
Part IV of this guidebook. include the architect, engineer, general contractor,
and attorney. The development of affordable housing
Local Government Leadership, Planning and should be led by a project manager responsible for as-
Housing Staff sembling a team of professionals bringing experience
Housing is a community asset that is locally based. Public and expertise in their respective fields. For example,
support of housing developments is tied to the problems projects financed with low income housing tax credits
they solve and the scope and quality of proposals. It is or SAIL funding will be required to have a development
critical to begin early to meet with several stakeholders in team that already has experience with these funding
the public sector to inform and to receive input. At some mechanisms. The members of the development team
point a project may require a public hearing for zoning or include the following.
funding, for example, and in those cases the importance
• Project Manager
of having made these connections is amplified.
• Developer
Many affordable housing projects are also eligible for • Appraiser/Market Analyst
local government funding. It is important to undertake a • Architect/Engineer/Surveyor
review of important local government documents such • General Contractor
as the Consolidated Plan, the Local Housing Assistance • Consultant
Plan, and the Housing Element that is part of the Com-
• Legal Team
prehensive Plan. These documents will help inform if
• Financing Partners
the project fits within the local community affordable
• Property Manager/Real Estate Agent
housing plans.
After reviewing the documents, meet with your local The Technical Advisor
government’s housing staff to determine the eligibil- As early as possible, it is important to communicate with
ity of your project for various funding programs, as a technical advisor who has expertise in the develop-
well as development incentives, application proce- ment of permanent supportive housing. The Florida
dures, and critical deadlines and timeframes. It is im- Housing Coalition’s technical assistance team has this
portant to convey to the housing staff that the project expertise and can provide guidance throughout the en-
will meet a demonstrated need for permanent sup- tire process. Applicants for the Predevelopment Loan
portive housing, and that the proposed project will Program (PLP), administered by the Florida Housing
be designed and operated to comply with program Finance Corporation, will be assigned a technical as-
rules and regulations. Housing staff may have valu- sistance provider to assist in forming the development
able suggestions on adjusting the concept to ensure plan and financing structure that are critical in the pre-
eligibility for housing programs and fit within their development phase. PLP is described further in Part II.
available funding sources.
Access the Predevelopment Loan Program at FHFC at: http://www.floridahousing.org/programs/
special-programs/predevelopment-loan-program
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Part II
Developing a Permanent Supportive
Housing Community
Predevelopment experience of a co-developer allowing them to eventu-
The predevelopment stage spans the time from con- ally develop more projects on their own.
cept development to ground breaking. This phase
The selection of a development partner for permanent
should not be rushed because spending quality time
supportive housing follows the same track as other
on predevelopment activities will save time, money,
types of housing, but there are some additional consid-
and heartache during development. It is not uncom-
erations. A Request for Qualifications may be the best
mon for the predevelopment phase to take longer
way to systematically consider and evaluate potential
than the overall financing and construction phase of
developers. If interested in a developer, it is instruc-
the project.
tive to visit the developer’s projects and talk with their
During the predevelopment process the development previous clients and funders. Seek to learn if they have
team is selected and begins to take action by selecting completed projects on time and within the budget. De-
a site and designing the project. In this formative stage termine if their previous nonprofit partners were active
there are opportunities to shift direction, choose a dif- participants, both financially and during the develop-
ferent site, or stop the process altogether. Once financ- ment process. Also consider if the type of housing they
ing and credit underwriting are underway, however, it is have produced is similar to the concept desired (e.g.,
much more difficult to make substantial changes. renovating single family homes is different from new
construction of a multifamily rental complex).
The Predevelopment Loan Program (PLP), which is ad-
ministered by the Florida Housing Finance Corporation, The checklist below provides some questions to con-
is an excellent way to borrow low interest funds to pay for sider when vetting possible co-developers.
many of the expenses incurred during predevelopment.
• Experience
Often, nonprofit organizations do not have the funding
available to pay for these expenses in this stage, and the • Is your project the type of project in which this
developer specializes?
PLP provides the financing and technical assistance to
guide the organization through the process. • Does the developer deliver a quality product?
• What is the developer’s reputation? Among
It should be noted that it is not a bad thing to terminate a former nonprofit partners? Funders? Credit
project in the predevelopment stage if it has been deter- underwriters?
mined that the project was not feasible, the organization • How many projects have they created and where?
did not have the capacity to execute the project, or the • Resources
site had issues that could not be corrected or mitigated.
• Do they have appropriate financing? How
strong is their balance sheet?
Selecting a Co-Developer
Many organizations that aspire to develop permanent • Do they have sufficient liquidity?
housing do not have experience in the financing and • Do they have appropriate and sufficient staffing?
development of housing, nor in the management of • What other projects do they have in process
rental property. In these cases, predevelopment would or in the pipeline?
likely entail forming a partnership with an experienced • Are they well-connected?
developer who can take responsibility for the many re- • Consider compatibility of mission with Co-De-
quirements ahead. The nonprofit may benefit from the veloper partner
PE R M ANE NT SUPPOR T IV E HOUSING | PR OPE R T Y M ANAGE M E NT GUI D EBO O K 11PART TWO
• Is the developer a for-profit or nonprofit entity? services, educational institutions, employment oppor-
• Do they prioritize good design features tunities, medical and support services, shopping, and
such as natural light, balconies, gardens, recreational amenities.
and amenities?
One primary consideration for the location of project
• Does the developer have an affiliation with a
is whether the setting is urban, suburban, or rural. The
property manager experienced in permanent
support housing? availability of transit, services, and employment are
most relevant for the residents. The availability of financ-
• Do they tend to have high requirements (i.e.,
high barriers) for leasing to tenants? Do they ing, land, and infrastructure are dependent and contin-
require minimum credit scores, minimum gent upon these development considerations.
income requirements, clear background
The discussion below covers the locational criteria that
checks, pristine former rental history? This is
very critical. Seek a partner that will not im- must be met to participate in the competitive multi-fam-
pose high barriers to qualification for residen- ily housing financing programs administered by FHFC.
cy in permanent supportive housing. Even if a development will not be using FHFC funding,
the criteria bear careful consideration as they are the re-
Site Location Criteria sult of demographic and market analyses that may im-
The developer of permanent supportive housing must pact the feasibility of the planned project.
consider the most important locational features for the
project while at the same time, if seeking FHFC funding, Areas of Opportunity
balancing the locational requirements inherent in the Projects that are located in defined “Areas of Opportu-
FHFC competitive multifamily housing financing oppor- nity” will receive preference for financing in many of the
tunities. In exploring choices and making decisions, the Requests for Applications offered by the Florida Hous-
developer will weigh these and attempt to choose a site ing Finance Corporation. Geographical criteria are
that ensures residents’ convenient access to community summarized in the table on the next page.
For more information on joint ventures, please visit and view the recorded webinar series by the Florida
Housing Coalition at https://vimeo.com/267291348 and https://vimeo.com/270495575.
12 FLO RI DA H O U S I N G COA L ITIO N | WWW. F L HO U S IN G.OR GPART TWO
SITE SELECTION CRITERIA DESCRIPTION
Geographic Areas of Census tracts that are designated as two or three factor tracts. These are
Opportunity locations with high indicators of community wellbeing:
1) Tract median income is greater than the 40th percentile of all tracts in the
county, and
2) Educational attainment above the median of all tracts for adults over age
25 have completed some college, and
3) Tract employment rate is greater than the statewide employment rate.
Difficult to Develop DDA’s are areas that have high construction, land, and utility costs relative
Areas (DDA’s) to area median gross income.
DDA’s may qualify for a 30 percent basis boost for housing tax credit proj-
ects. DDA’s apply to an entire county.
Small Area Difficult to More precisely defined DDA’s useful in metropolitan settings to qualify for
Develop (SADDA) a basis boost and other incentives.
R/ECAP Areas FHFC discourages new affordable housing development in R/ECAP areas
Racially/Ethnically but will consider applications to preserve or redevelop housing in R/ECAPs.
Concentrated Areas of
Poverty
Qualified Census Tracts QCT’s are tracts in which at least half of the households in the tract have an
(QCT) income less than 60 percent of the area median income (AMI) or there is
a poverty rate of at least 25 percent. QCT’s are eligible for a “basis boost”
for tax credit projects. Projects that are located in a QCT that is also in a R/
ECAP area (see above) will not qualify for new construction.
Limited Development LDA’s are defined by FHFC as having low occupancy conditions (less than
Area (LDA’s) 90 percent occupancy) in its rental property portfolio, where development
is limited to allow existing properties to stabilize income and occupancy
before new developments of similar scope are approved.
Mandatory Distance FHFC publishes mandatory distance requirements for certain types of
Requirement Areas housing in certain areas to prevent the overconcentration of subsidized
housing which could affect the occupancy of assisted existing projects.
The Beta Mapping Tool for Multi-family applications is a valuable aid in evaluating a particular site for its
potential to be awarded financing from Florida Housing Finance corporation. The instructions for using the
tool can be downloaded from this site: https://www.floridahousing.org/docs/default-source/programs/
mapping-basics-user-guide.pdf?sfvrsn=2
PE R M ANE NT SUPPOR T IV E HOUSING | PR OPE R T Y M ANAGE M E NT GUI D EBO O K 13PART TWO
Proximity Considerations party reports and the use of a checklist to make sure the
Another important location consideration is meeting property can be developed as planned. Sites that must
the proximity requirements within each Request for Ap- be rezoned, require land use plan amendments, or do
plication (RFA) for financing offered by FHFC. Proximity not have infrastructure are least desirable. It is best to
requirements are specified for each RFA; therefore, it is acquire land that has the correct zoning and land use
important to evaluate each RFA individually to ensure that designations with infrastructure available to the site.
the planned project will be on a site that meets the prox-
To ensure project operating feasibility, supportive hous-
imity requirements for services, as specified in the RFA.
ing projects should have as little debt as possible. Land
Importantly, the chosen site must have access to reliable costs are often a large portion of the budget and can
public transportation. Residents unable to walk to bus impact the operational capacity if debt service must be
or transit stops should be able to enroll in paratransit covered. Many local governments have “surplus land”
services. Services may be provided to provide transport that can be made available to nonprofit housing organi-
assistance to bus stops, shopping, and other locations. zations. In Florida, municipalities are required to main-
Residents must have access to groceries, medicine, tain an inventory of surplus land suitable for affordable
household supplies, and general shopping. housing, so you should check with the appropriate lo-
cal government housing department to view the inven-
Each RFA that includes proximity criteria states the maxi-
tory and consider making an application for acquisition.
mum distance for a service to qualify as meeting locational
requirements. Proximity to services includes the following. An expanded list of site due diligence criteria is pro-
• Bus/Rail stop vided in Appendix III.
• Grocery store
Market Analysis
• Medical clinic During the credit underwriting process, which is nec-
• Pharmacy, for elderly and certain other projects essary to obtain financing, a market analysis will be re-
• Public/charter school, for family projects quired. The market analysis will determine how strong
the demand is for this type of housing, how long it will
Other community services that should be carefully ex- take to reach stabilized occupancy (i.e., 90 percent)
amined and identified include the following. and the level of effort or distance away from the site
• Education for continuing education, vocational where eligible tenants can be “captured” to move to
training, and life skills such as cooking the property. While the formal market study is part of
• Support services, such as behavioral health care
the underwriting process, it is important to conduct an
• Recreation such as volleyball, basketball, table informal market study as part of the due diligence pro-
tennis, bingo, dance classes cess prior to site acquisition. For permanent supportive
• After school programs for youth including ac- housing, the market has certain characteristics that go
ademic achievement, social functioning, post beyond income level and would include persons with
high school readiness, if youth will be residents
disabling conditions, who are homeless, or who meet
in the development
other program requirements.
• Community events
• Small business incubators Legal Consultation
• Career source facilities for job preparation, job Legal counsel should be available to review the details
search assistance, job training of all land transactions and loan agreements. Attorneys
• Child care should be experienced with affordable housing de-
velopment as well as Florida real estate law. A project
Due Diligence Process for Site Selection using Low Income Housing Tax Credits in financing will
The evaluation of the suitability of a site for the pro- need counsel experienced in the closing of these types
posed development can be accomplished with third of agreements and loans.
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Financing Process
Once the site has been deemed appropriate for the project, financing must be secured. This process can involve
many different sources, each with specific requirements. In Florida, the primary source of financing for affordable
housing is from the Florida Housing Finance Corporation, which has provided support and financing for many per-
manent supportive housing developments. Some Requests for Applications (RFA’s) are for larger projects that will
utilize Low Income Housing Tax Credits (LIHTC) and SAIL (60 or more units), and others are for medium projects (30-
60 units) or smaller projects (less than 30 units).
The primary sources of funding for permanent supportive housing are described in the chart below.
INCOME RENT
FUNDING OTHER
SET-ASIDE LIMITS
SHIP (State Housing 120% AMI 30% of 20% of program
Initiatives Partnership applicable funds must be
Funding for construction, rehab, income limit dedicated to persons
emergency and rental assistance with developmental
disabilities or other
special needs
SAIL (State Apartment 20% forPART TWO
The application for financing through FHFC follows an annual process known as the Request for Applications or
RFA cycle. The process allows for public input during the design of financing opportunities. The graphic below
describes the general process of the RFA cycle, though dates vary depending on the RFA.
JUNE AUG OCT DEC MAR APR
FHCA Board RFA RFA Issue Application Review Committee FHFC Board to
Approves RFA Workshop Date Due Date Scores Applications Approve Decisions
Credit Underwriting tion process begins. During this time the owner and
Projects that have been successfully ranked in the com- partners must oversee the development and respond
petitive or non-competitive funding application process to requests for payment, inspections, and overall com-
are invited to credit underwriting and a credit underwrit- pletion of the units according to plan. During this time
er will be assigned by the funder. The credit underwriter the property manager is marketing to potential tenants
will remain responsible for the project not only during and pre-leasing the units.
the preparation of the Credit Underwriting Report, but
throughout the construction, leasing and operations of Project Stabilization and Final Closing
the project during the term of affordability. Once a project is cleared for occupancy the tenants
move in. The property manager is responsible for intake
The basic process of credit underwriting for project fea- of applications, lease signings, and move ins. Property
sibility is to determine if the project has a sound busi- is considered stabilized when it reaches 90 percent oc-
ness plan. The credit underwriting process evaluates cupancy. This status enables the owners to conduct the
four main components, as follows: final closing on the long-term financial obligations.
• Suitability and readiness of the proposed project site
• Financial capacity of developer Period of Affordability
Each funding source has a set of requirements on af-
• Feasibility of project to operate long term as
proposed fordability, number of set-aside units for special needs,
and the term of compliance. The term of compliance
• Ability to proceed
is the length of time the property must serve a certain
Funding Award and Initial Closing population at certain affordable rents. The period of
Once the project receives a favorable Credit Under- affordability can range from 15 to 50 years depending
writing Report, the funds may be officially awarded and on the funding source. The long-term compliance re-
there is a closing on the issuance of the loans and grants quirements vary from program to program and the most
that have been obtained. From this point construction stringent requirement always applies.
may commence and funding draws can be requested.
Compliance Monitoring
Construction and Lease-Up During underwriting a monitoring and compliance
After the initial closing on the financing, and receipt of schedule is set up in the regulatory documents that
all development approvals and permits, the construc- defines the frequency and subject of monitoring over
See the Florida Housing Coalition Affordable Housing Resource Guide for comprehensive information on
each funding source: http://www.flhousing.org/wp-content/uploads/2017/05/Affordable-Housing-
Resource-Guide-2017-05.pdf
16 FLO RI DA H O U S I N G COA L ITIO N | WWW. F L HO U S IN G.OR GPART TWO
the period of compliance. Multifamily rental properties Regulatory Agreement /Land Use Restriction
financed by Florida Housing Finance Corporation are Agreement
required to be monitored on several aspects of oper- The financing agreements and conditions are de-
ations: onsite management, review of tenant files, ad- scribed in a Regulatory Agreement, which is filed in the
ministrative procedures, and a physical inspection of public records for the property as a Land Use Restriction
the property. Noncompliance is reported to the owners Agreement (LURA).
and managers who must respond to any concerns and
correct any findings.
PE R M ANE NT SUPPOR T IV E HOUSING | PR OPE R T Y M ANAGE M E NT GUI D EBO O K 17PART THREE
Part III
Managing and Operating a Permanent
Supportive Housing Development
The Property Management Plan property is stabilized and there may be different per-
The Property Management Plan is a key factor in the sonnel. It may be useful to include an organization chart
successful and sustainable operation of permanent showing the relationship of the main entities, as well as
supportive housing. The Management Plan defines the management team and the services team.
the governing framework of the property and sets
forth the policies and procedures to be used by man- Property Management Policies
agement staff including leasing, support service coor- Policies for the management of permanent supportive
dination, maintenance, and compliance with the Reg- housing should reflect the purpose and values of the or-
ulatory Agreement and any other financing conditions. ganization and its commitment to provide a quality res-
A separate Management Plan should be provided for idential community that meets the needs of its selected
each property in the portfolio. This section provides tenancy. The policy descriptions below can be adapted
guidance on the preparation of the plan. In Appen- for the property management plan.
dix IV, we offer a property management template as a
sample framework for new projects. Leasing Policies
Lease Form
Staff Organization The standard real estate lease provided by the Florida
Organization Chart Bar/Florida Association of Realtors is recommended.
The Management Plan should have an overview indi- The leases should not contain requirements for tenants
cating all staff and their designated roles and positions. to accept support services, or any other requirements
The initial operating team may change over time as the that are not contained in a standard lease (e.g., abstain-
SAMPLE Permanent Supportive Housing with internal property
ORGANIZATION CHART management and resident services
Board of Directors
Chief Executive Officer
Resident Real Estate Chief Financial Operations Human Fundraising
Services Development Officer Director Resources Director
Services Compliance
Director Leasing
Coordinator
Maintenance
Case Manager
Accounting &
Reporting
18 FLO RI DA H O U S I N G COA L ITIO N | WWW. F L HO U S IN G.OR GPART THREE
ing from alcohol). All occupants of the unit must be tions must take into account the recency, nature, and
listed on the lease and leases must be current and fully severity of the crime. Arrest records alone cannot be
executed. Lease terms must be consistent with the Reg- used to disqualify an applicant for tenancy.
ulatory Agreement.
Timeliness
Housing First The leasing process must be convenient, streamlined,
Housing First should be followed as the core value of and efficient to best serve future residents. The review
the property. This means that individuals and families and approval or denial process should be clearly stated.
experiencing homelessness who have disabilities can Once an application is submitted, this process should
be rapidly housed in permanent housing without pre- take no longer than several days to a week.
conditions (e.g., drug testing), and then connected to
Appeal Process
voluntary support services to help achieve housing sta-
A written and easy to understand appeals process must
bility, wellness, and independence.
be in place and made available to applicants who are
Referrals denied tenancy. The applicant must be notified as to
For properties serving residents who have experienced the reasons for the denial and be provided an oppor-
homelessness, the Continuum of Care (CoC) Coordi- tunity to provide additional information or explanation
nated Entry System is the most effective way to priori- and bto have the denial reconsidered.
tize individuals in the most need of permanent sup-
Eligibility Determination
portive housing. New units coming online should be
If the prospective tenant is referred through the CoC
registered with the CoC through HMIS to create new
Coordinated Entry System or LINK referral agency, the
program capacity according to the set-aside character-
referral will typically include the documentation required
istics of the property. The Coordinated Entry System’s
for the determination of eligibility. For all applicants, the
prioritization programming will determine the highest
property manager must determine the eligibility of an
priority for each eligible group, which in turn will result
applicant based on program requirements, coordination
in the screening in of referrals in priority order facilitat-
with service providers, and as provided for in the Regula-
ing a smooth enrollment process. All vacancies should
tory Agreement. The property manager must certify that
be filled through the prioritization and referral of the
the tenant meets eligibility requirements.
Coordinated Entry System of the Continuum of Care.
For properties serving non-homeless subpopulations, Tenant Income Certification
referrals may be received through FHFC’s LINK referral The income of applicants must be verified and certified
agencies or other human services agencies or health in accordance with the funding sources. Tenants may
care organizations. not be required to have income to live at the proper-
ty if there is evidence that housing costs can be paid
Screening In
through another source. For instance, the owner and
The tenant selection process must rely on an approach
services provider may identify alternative sources of
that will screen tenants in, rather than screen them out.
rent subsidies or housing vouchers to cover the rent
It is recognized that applicants for permanent support-
and utilities for tenants who do not have income while
ive housing may have poor credit, past evictions and
they work with the tenant to obtain income. All tenants’
negative rental histories, and so on. An applicant with
income must be re-verified and certified on an annual
a recent history of poor credit or evictions should be
basis or according to the Regulatory Agreement.
provided an opportunity to present mitigating informa-
tion and additional information to address concerns or, Annual Re-certification
if appropriate and feasible, pay an additional security The property manager must re-certify the eligibility of
deposit. Criminal background checks should be per- tenants on an annual basis or as required by funding
formed only to identify recent convictions for violent sources. A development that is categorized as perma-
crimes, and the consideration of any criminal convic- nent supportive housing certifies that 100 percent of its
PE R M ANE NT SUPPOR T IV E HOUSING | PR OPE R T Y M ANAGE M E NT GUI D EBO O K 19You can also read
