2016 Affordable Housing Programs Announced
The FHLBC’s Board of Directors recently approved the 2016 Affordable Housing Program Implementation Plan (Plan). The Plan sets forth certain requirements and guidelines applicable to the FHLBC’s Affordable Housing Program (AHP). AHP consists of a homeownership set-aside program (i.e. Downpayment Plus®) and a competitive program.

Significant details of the 2016 Plan:

Downpayment Plus (DPP®) Homeownership Set-Aside
  • The FHLBC is now administering the DPP programs.
  • All program functionalities have been migrated to a new online system.
  • Program participation fees have been eliminated.
  • Enhanced security of data and documents is in place.
  • The maximum grant to eligible households is $6,000.
  • The member limit is $420,000.
  • Reservations are on a first-come, first-served basis.
  • The member must originate or fund the first mortgage.
  • Grants are forgiven on a monthly basis over a five-year retention period.
  • Properties may be in any state in which the member does business. 
Competitive AHP Program
  • In 2016, there will be one competitive application round with an application deadline of 5:00 p.m. on Friday, June 17, 2016.
  • The maximum subsidy per project is $850,000 or 75% of total project costs, whichever is less.
  • The FHLBC will continue to limit the amount of subsidy a member may apply for to a maximum of 25% of the subsidy announced for each application period. The limit will be calculated based on the order in which applications are in “Member Approved” status in AHP Online.
  • The section previously titled “Program Minimum Eligibility Requirements” has been deleted and all but one of the requirements under that section were moved to Exhibit I: Project Feasibility and Cost Guidelines.
  • Changes to the Feasibility Guidelines include:
    • Minimum LIHTC price increased to $0.87
    • Increased operating cost-per-unit guidelines
    • Development cost-per-unit guidelines will be published prior to the opening of the 2016 competitive round.
  • Changes to the Scoring Guidelines include:
    • Use of Donated or Conveyed Government-Owned or Other Properties: revised the definition of projects eligible to receive points.
    • Project Sponsorship: points for owner-occupied projects are now variable.
    • Promotion of Empowerment: an additional empowerment service was added.
    • Project Readiness: site control and zoning will be evaluated as part of project feasibility and are no longer included as part of this scoring category.
    • Member Financial Participation: clarified that eligible member financial participation may be by an entity in which the member has >50% ownership interest and/or by an entity that has >50% ownership interest in a member; also added participation in permanent financing as an example of long-term financing and participation in a construction or bridge loan as an example of intermediate or short-term financing.
    • Community Stability remains a 23 variable-point scoring category but the allocation of points has changed slightly:
      • Rehabilitation of Single-Family Housing was revised to Rehabilitation of Existing Occupied Housing and was increased from six to seven points.
      • Promotion of Homeownership was revised to Promotion or Preservation of Homeownership.
      • Elimination of Blighting Influences has been increased from four to five points.
      • Preservation of Affordable Housing tied to the expiration of land use or restrictive use has been deleted.
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Federal Home Loan Bank of Chicago
200 East Randolph Drive
Chicago, IL 60601
www.fhlbc.com
This newsletter contains forward-looking statements which are based upon our current expectations and speak only as of the date hereof. These statements may use forward-looking terms, such as "anticipates," "believes," "expects," "could," "plans," "estimates," "may," "should," "will" or their negatives or other variations on these terms. We caution that, by their nature, forward-looking statements involve risk or uncertainty, that actual results could differ materially from those expressed or implied in these forward-looking statements, and that actual events could affect the extent to which a particular objective, projection, estimate, or prediction is realized. These forward-looking statements involve risks and uncertainties including, but not limited to, the risk factors set forth in our periodic filings with the Securities and Exchange Commission, which are available on our website at www.fhlbc.com.

Copyright © 2016, Federal Home Loan Bank of Chicago. "Downpayment Plus," "DPP," "Downpayment Plus Advantage," and "DPP Advantage" are registered trademarks of the Federal Home Loan Bank of Chicago. "Community First" is a registered trademark of the Federal Home Loan Bank of Chicago.
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