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HUD’S OFFICE OF MULTIFAMILY HOUSING
PROGRAMSENERGY INNOVATION FUND
NOFASEPTEMBER 19, 2011
PURPOSES OF THE ENERGY INNOVATION FUND (EIF) PURPOSES OF THE ENERGY INNOVATION FUND (EIF) PROGRAMPROGRAM
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MAIN PURPOSE:Stimulate innovative, scalable, replicable approaches for
increasing the energy efficiency of existing multifamily properties.
OUR AUTHORITY: Consolidated Appropriations Act of 2010 (Pub L. 111-117).
Congress directed $25 million for the Multifamily Energy Pilot Program to catalyze innovations in the residential energy efficiency sector that have promise of replication. This NOFA provides information and instructions for applying for a grant.
OUTCOMES OF THE EIFOUTCOMES OF THE EIF
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HUD expects that outcomes of the Program will include:
• Reduced energy consumption, and lower greenhouse gas emissions.
• Increased private investment to support multifamily energy efficiency.
• Green jobs in construction, property management, technical analysis.
• Quality data on retrofit costs, benefits, challenges, and opportunities.
• Approaches for retrofitting such properties that can be applied widely.
• Approaches that address the so-called “split incentives” issue.
CRITICAL CRITICAL DETAILS FOR MULTIFAMILY EIF
Application deadline is Thursday October 20, 2011 Application deadline is Thursday October 20, 2011
Full NOFA and Application can be accessed at Full NOFA and Application can be accessed at www.grants.gov• After you register, go to “Apply For Grants”; then choose “Step 1,
Download a Grant Application package”; then enter CFDA # 14.319.
Applications must meet all:Applications must meet all:• Entity eligibility requirements• Property eligibility requirements• Activity eligibility requirements
• All applications must be submitted electronically through www.grants.govAll applications must be submitted electronically through www.grants.gov• Today’s webcast will be archived, available for viewing on HUD’s websiteToday’s webcast will be archived, available for viewing on HUD’s website• Today’s webcast is intended to provide clarification to the NOFA. In the Today’s webcast is intended to provide clarification to the NOFA. In the
event of conflict between information provided today and information event of conflict between information provided today and information provided in the NOFA, the published NOFA prevails.provided in the NOFA, the published NOFA prevails.
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ELIGIBLE APPLICANTS INCLUDE:
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1. Treasury-certified community development financial institutions (CDFIs) with affordable housing development and rehabilitation programs.
2. National, regional, or local private or non-profit entities, inclusive of Public Housing Authorities, currently administering affordable housing development and rehabilitation programs, including technical assistance and capacity building programs. Such entities must manage or direct programs impacting a minimum of 1,000 units of affordable housing.
3. Special purpose financing entities (e.g., housing trust funds) whose primary purpose is to preserve, retrofit, and/or build affordable housing.
4. Nonprofit or for-profit organizations (and/or consortia thereof) that own or control a portfolio of Eligible Multifamily Properties. Such entities must manage or direct programs impacting a minimum of 1,000 units of affordable housing.
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Eligible Properties must have all of the following features:
• Multifamily Properties (5 units or more)• Existing Properties (no new unit construction)• Affordable Housing (majority of units serve low-income
residents), including public housing properties• Under control of applicant
ELIGIBLE PROPERTIES
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Two types of awards:
1. Financing Demonstrations
2. Applied Research Demonstrations
ELIGIBLE ACTIVITIES / TYPES OF AWARDS
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Must leverage additional capital • Minimum 2:1 match at the award level, plus• Minimum 1:1 match at the property level
Must test new ways of funding energy retrofit improvements.
Examples of eligible Financing Demonstrations include: 1) Energy retrofit financing vehicles providing investor equity; 2) Loan loss reserves; interest rate reductions; 3) Secondary financing; loan guarantees; secured/unsecured loans; 4) Energy-related revolving loan programs; 5) On-bill utility repayment programs or other mechanisms; 6) Power purchase agreements, energy performance contracts, or similar
financing structures.
Award Ceiling for each Financing Demonstration award is $7.5 million
FINANCING DEMONSTRATIONS
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Must address a longstanding barrier to multifamily residential retrofits that:1) is not primarily financial in nature; and2) is applied to an actual property or group of properties (pure research is not
allowed).
May address the issue in behavioral, structural, or regulatory terms, or be related to availability of information or options.
Examples of eligible Applied Research Demonstrations include:• Solutions that provide more information on and greater owner and/or tenant
control over energy use; • Solutions that convert properties from master metered/owner paid utilities to
individually metered/tenant paid utilities that result in efficiencies and savings, or vice versa; and
• Conservation practices and solutions that address the problem of split incentives by creating incentives for parties that promote investment strategies for energy improvements.
Award Ceiling for each Applied Research Demonstration award is $3 million
APPLIED RESEARCH DEMONSTRATIONS
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Participation requires matching funds from private, non-governmental sources (funds other than federal, state, local, or tribal) to complement grant funds. An applicant must demonstrate upon application the commitment of such funds:
• Financing Demonstrations: Matching funds of at least $2 of for every $1 requested, and will be required to bring additional matching funds of $1 for every $1 loaned at the project level.
• Applied Research Demonstrations: Matching funds of at least $1 for every $1 requested.
NOTE: A secondary purpose of this program is to engage private industry in the initiative; additional matching funds above these minimum thresholds are desirable, and the application review process gives credit for funds above the match minimums.
MATCHING FUNDS REQUIREMENT
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Guidance for preparing a Successful Application
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• Competitive entities must be eligible (as defined in the NOFA) and are expected to be very experienced, control a lot of housing, already be addressing affordability, be able to get parties in private sectors interested.
• Applicants must bring something new to the table - seeking creativity, innovation.
• Credit Factors (in review of applications): • 1. Experience/Capability• 2. Soundness of Approach• 3. Maintenance of Funds and leveraging above match• 4. Low Income Needs• 5. Sustainable Solutions
ANTICIPATED IDEAL APPLICANTS (FAVORED IN SCORING)
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Are you an eligible applicant? Do you have significant experience in affordable housing? Have you secured necessary outside funding? Can you document your private funding sources? Are you proposing a “new” area of investigation, i.e. is your idea competitively
innovative? Is your proposal “replicable” and “scalable”? Are you prepared to negotiate the final terms of work to be performed with HUD
prior to an award? Are you proposing a team of key personnel who are experienced in both housing
and energy innovation? Are you willing to negotiate changes to the work activity based on periodic
examination of progress and outcomes? Have you identified properties for this program that can meet environmental and
other HUD requirements? Do you have or are you willing to accept/extend Use Agreements on all program
properties? Have you determined how to perform the proposed work and created a draft
Work Plan (complete with milestones and timetables) to submit with your application?
APPLICATION CHECKLIST
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• HUD will require that the ownership of a property benefiting from these grant funds:
• Have an existing Use Agreement with a remaining term of at least ten years from date of delivery of the grant benefit or commencement of grant-related activity; or
• Extend the term of any existing Use Agreement for a period of at least ten years; or
• Execute a new Use Agreement for a period of no less than ten years from this date, in a form and substance prescribed by HUD.
USE AGREEMENT REQUIREMENTS
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• Applicants must make a commitment in the Draft Work Plan to Implement an Operations and Maintenance Plan for each property.
• Applications must include a template for an Operations and Maintenance Plan.
• Templates should: Identify best practices from the green housing industry; Describe how residents will be engaged.
• Examples include the HUD Mark-to-Market Green Initiative Operations and Maintenance Plan, and the Enterprise Green Communities Operations and Maintenance requirements.
• For Financing Demonstrations, sub-grantees/borrowers may develop their own plan so long as the Grantee reviews and accepts the plan prior to commencement of the grant activity.
OPERATIONS & MAINTENANCE PLAN
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Matching Dollars Required:• Financing Demonstrations: matching dollars 2:1• Applied Research Demonstrations: matching dollars 1:1
As a part of the application, demonstrate the ability to match funds via either:1) their own capacity to provide required funds or2) letters of intent from one or more third parties
Letters of Intent from third parties must : 1) demonstrate agreement to perform a specified activity2) describe the proposed total level of commitment (in dollar value)3) demonstrate financial capacity to deliver the pledged resources; and 4) evidence intent to commit the resources if the application is funded. 5) be written on the letterhead of the third party organization6) be executed by a legally authorized official of the organization7) be dated no earlier than the date of publication of this NOFA; and 8) remain valid for the full period of proposed grant activities.
Letter of Intent must convert to Third Party Commitment Letters prior to award.
DEMONSTRATING THE ABILITY TO BRING IN MATCHING FUNDS AT THE APPLICATION STAGE
Application received by HUD
HUD checks for completeness; examines receipt date and inventories documents.
HUD checks for completeness; examines receipt date and inventories documents.
Complete applications delivered to Selection Committee (SC) Complete applications delivered to Selection Committee (SC)
SC makes preliminary selection and contacts potential grantees to open negotiations
SC makes preliminary selection and contacts potential grantees to open negotiations
SC and potential grantees agree on Work PlanSC and potential grantees agree on Work Plan
Grantee executes grant /cooperative agreement and work plan - POINT of OBLIGATION of FUNDS
Grantee executes grant /cooperative agreement and work plan - POINT of OBLIGATION of FUNDS
SC is satisfied with terms of Work Plan and 718 Issued - COMMITMENT
SC is satisfied with terms of Work Plan and 718 Issued - COMMITMENT
Incomplete app rejected or request revisions
Incomplete app rejected or request revisions
Incomplete app rejectedIncomplete app rejected
Applicant fails to negotiate/ rejected
Applicant fails to negotiate/ rejected
Agreement not reachedAgreement not reached
Negotiations failNegotiations fail
EI project begins
PROCESS FLOW CHART – APPLICATION, NEGOTIATION & AWARD
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• Draft Work Plan is a required submission with the application.
• The Draft Work Plan must describe the objectives of the proposed activity, how those activities will be implemented and achieved, milestones, and timetable.
• If an applicant is preliminarily selected by HUD, the draft Work Plan will be used as the basis for negotiations, and a final Work Plan will be developed in that process.
• Grants will be awarded through Cooperative Agreements rather than traditional grant agreements, giving HUD the ability to work closely with each Grantee.
DRAFT WORK PLAN
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• MAXIMUM POINTS that may be awarded to any application: 100 plus 2 possible bonus points
• NEGOTIATIONS: Applicants with the highest scoring applications will be contacted in order of ranking to participate in negotiations leading to a possible award of grant funds. HUD will enter into negotiations with those applicants using the draft Work Plan (required in the application package). The applicant and HUD must agree on a Final Work Plan which will include all milestones for the activity and for disbursement of the Grant funds by HUD to the Grantee.
APPLICATION SORTING CRITERIA
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The rating categories are:
Factor 1: Experience and Capacity – up to 25 points • Management Team and Key Staff : 0 to 10 Points• Organizational Experience : 0 to 5 Points• Capacity : 0 to 10 Points• Deduction for Poor Prior Experience: Up to 15 Points
Deducted
Factor 2: Soundness of Approach – up to 35 points • Implementation Strategy: 0 to 15 Points• Innovation: 0 to 10 Points• “Replicability”: 0 to 10 Points
HOW TO MAXIMIZE THE EFFECTIVENESS OF YOUR APPLICATION
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Factor 3: Matching Funds/Leveraging – up to 15 points • More points for leveraging (bringing additional funds above required
matching ratio): 0 to 10 Points • Continuation beyond grant period: 0 to 5 Points
Factor 4: Low Income Housing Needs – up to 10 points • More points for a higher percentage of housing units for Low-income
population• More points for a longer term of Use Agreements (See table in NOFA
for point calculation).
Factor 5: Sustainable Solutions – up to 15 points • Energy savings and Greenhouse gas emission reductions: 0 to 13
Points• Capacity Building and Knowledge Sharing: 0 to 2 Points
Bonus Points - 0 to 2 Points
HOW TO MAXIMIZE THE EFFECTIVENESS OF YOUR APPLICATION
AFTER AWARD – WORKING TOGETHER
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GRANTEES will coordinate progress directly with HUD
Kickoff Meeting –within 30 days of award• Coordinated by OAHP• Discuss/Understand milestones for measuring progress• Discuss/Understand process and procedures for making e-LOCCS
withdrawalsPeriodic Progress Meetings
• Grantees and HUD meet pursuant to Work Plan• Discussion of progress, barriers encountered, proposed solutions
Funding Withdrawals from e-Loccs System• Timing and withdrawal triggers
HUD review and approval of withdrawals requests
MANAGING THE GRANT ACTIVITY
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REPORTING REQUIREMENTS
Quarterly report requirements are as follows:
a.Comparison of scheduled milestone completion and expenditures to actual activity.
b. Dollars expended to date, sub-awards made, and funds remaining, all by funding source.
c. Program Income as per applicable program income rules.
d. For Financing Demonstrations awards that create a revolving loan fund, report on matching dollars for grant activities at
the project loan level (1:1 match requirement).
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Annual report requirements are as follows:
a. Number of units and the number of properties receiving energy retrofits.
b. Energy consumption and costs prior to retrofit in properties receiving energy retrofits.
c. Specific retrofit measures being applied.d. Estimated and actual costs of the retrofit measures.e. Energy consumption reductions anticipated, and as achieved (when
available).f. Financial savings from improved efficiency for the property and for
residents.g. Financial structures utilized, and the associated transaction costs.
REPORTING REQUIREMENTS
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Final report to HUD upon Grant closeout
Contains a final summary of program activities and outcomes including:
• Review of actual outcomes compared to anticipated and projected outcomes;
• Discussion of lessons learned, anticipated and unanticipated problems and solutions;
• Discussion of the benefits that resulted from the program activity.
REPORTING REQUIREMENTS
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• PURPOSE: Stimulate innovative, scalable, replicable approaches for increasing the energy efficiency of existing multifamily properties
• Carefully review entity, property, and activity eligibility requirements• Financing Demonstrations:
2:1 matching requirement (plus 1:1 at the property level for loan funds) Award cap of $7.5 million per award
• Applied Research Demonstrations: 1:1 matching requirement Award cap of $3 million per award
• Applications deadline Thursday, October 20, 2011 at 11:59:59 Eastern time; NOFA General Section includes instructions for timely receipt
• Process: Applications will be reviewed, rated and ranked by HUD. Grantees preliminarily selected will be invited to negotiate final Work Plan
with HUD. • Final Grantees will execute grants/Cooperative Agreements with HUD
EIF NOFA SUMMARY
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• Email questions to [email protected]
• Further Information: • Visit www.grants.gov for complete program description and NOFA
and program application and application instructions
• The Multifamily Energy Innovation Fund is CFDA # 14.319, published as Federal Register FR-5415-N-01
• Thank you for your interest, attention and participation!
CLOSING