Initial Steps in Developing a Section 202/8 Application-Private:

When a group wants to undertake an application to HUD for a Section 202 capital advance, there are four primary areas which are the responsibility for the local group:

1. Location of a site and site control

For an elderly housing project, HUD requires that a site be under option at the time of application. the term of the option needs to be for one year and renewable for an additional 12 months, should the project be awarded a capital advance reservation. Often it is necessary to make a small payment to the owner in order to obtain the option. The minimum project size, in order to have sufficient unites over which to spread the administrative costs is 40 to 60 units. A project of this size will typically require about three acres to accommodate a three-story building and appropriate amounts of parking. All utilities should be present at the site boundary (water, gas, sewer, and electric lines with sufficient capacity to carry the project). this is money which is typically at risk, as it will usually not be recovered unless the project is funded. It should be located in close proximity to shopping, medical, pharmacy and bank services, and on public transit lines if at all possible.

Before the application deadline, the site must either be properly zoned for multifamily housing, or a letter from the city commission governing zoning must be obtained indicating willingness to change the zoning or the steps necessary to change the zoning.

2. Selection of an Architect

It is extremely important that the architect selected be someone who has experience in working with the particular HUD office to which the application will be submitted. the reason this is so important is that the design is graded and rated along with all other aspects of the application. HUD has a very particular cost containment regulations, but they are interpreted differently in different offices. In order to score highly and have a good chance of being funded, groups need to
work with an architect who is familiar with the particular interpretations of the office to which the application will be
submitted. Housing 202 Ltd. will recommend an architect that has the experience to complete the project.

3. Collection of Letters of Support

One of the required exhibits in the application is a demonstration that the project is supported by your community, by means of support. The connections of the local task force members should be call on to obtain letters of support from the Chief Executive of the city (Mayor or Manager), the city Government Representative for the district in which the site is located (Alsterman, Councilman, etc.) and other local elected officials such as Zoning commissioners. It is also very important to have letters from the national Senators and Representatives for the district. Letters from the Governor and other state officials are also desirable. in addition, there should be letters from people who direct community services to the elderly in the area. Ideally these letters, in addition to documenting the support of the social service agencies for this project, would make it clear that these services would be available to residents of the new project. The third type of letter is a general category including letters from local business people and the community. The purpose of this category is to demonstrate that the group has community support.

4. Obtaining Seed Money

A commitment to sponsorship of a project currently carries with it a commitment of $25,000. The funds are used to defray the costs of such items as Phase 1 Environmental, Option on the proposed site, title work for the site, retainer feeds to the housing consultant or architect, plan review fees, and phone or postage bills and printing expenses. A group wishing to undertake a project should have in mind a source for these funds.