Title
Acquisition, Rehabilitation, and Resale Fund for Homeownership Contract
Action
Action:
A. Approve a contract in the amount of $1,200,000 with Habitat for Humanity of the Charlotte Region to support the production and sale of affordable homeownership units under the Acquisition, Rehabilitation, and Resale Fund for a term of one year, and
B. Authorize the City Manager to renew the contract for up to one, one-year term and to amend the contract consistent with the purpose for which the contract was approved.
Body
Staff Resource(s):
Rebecca Hefner, Housing and Neighborhood Services
Warren Wooten, Housing and Neighborhood Services
Explanation
§ The Acquisition, Rehabilitation, and Resale Revolving Loan Fund Program (ARR) was established to expand affordable homeownership opportunities and revitalize neighborhoods by leveraging partnerships with non-profit organizations to acquire vacant or rental single-family homes, perform needed renovations, and resell the homes to income-eligible buyers.
§ In August 2024, the city released a rolling application for ARR loan pool membership seeking non-profit organizations experienced in housing development and rehabilitation. Approved loan pool members are eligible to participate in the program and request funds.
§ Habitat for Humanity of the Charlotte Region (Habitat) was approved as a qualified pool member in November 2024.
§ Habitat will use the $1,200,000 to produce 15 affordable single-family homes through acquisition, rehabilitation, and resale.
§ ARR guidelines include:
- Unit acquisition will be targeted to the Corridors of Opportunity;
- Average per-unit city subsidy up to $80,000, with the possibility for additional down payment layering to ensure affordability (for example, through the city’s House Charlotte program);
- Homes will be sold to buyers earning 80% of Area Median Income or below (currently $84,800 for a family of four);
- Eligible buyers must secure first mortgage financing and meet income requirements; and
- Units may not be used for rental purposes, and the city or non-profit partner will hold a right of first refusal to help ensure long-term affordability.
Background
§ On November 13, 2023, City Council approved $5.9 million in Coronavirus State and Local Fiscal Recovery Funds (SLFR Funds) to support the Neighborhood, Equity, and Stabilization (NEST) Commission’s recommendations, including expanding the ARR Program to create affordable homeownership opportunities for low-to-moderate income residents.
§ On November 25, 2024, City Council approved the use of $25.4 million of SLFR Funds for government services to offset revenue lost as a result of the COVID-19 public health emergency (revenue replacement), and simultaneously appropriated the same amount from the General Operating Fund to the American Rescue Plan Act (ARPA) Fund, to allow more time to obligate and expend ARPA funds that had already been programmed by City Council, including the $5.9 million support of anti-displacement programs recommended by NEST.
§ The ARR Program aligns with City Council goals, priorities, and policies including the Housing Charlotte Framework, Anti-Displacement Strategy, and Affordable Housing Funding Policy.
Fiscal Note
Funding: 2024 General Operating Funds appropriated to the ARPA Fund