Supervisors return recaptured down-payment funds to county DPA program

A county housing-program staff member told the Carroll County Board of Supervisors that recapture from a past down-payment-assistance (DPA) loan amounted to $11,536 and recommended returning the money to the county's DPA program. Supervisors moved and approved returning $10,536 to down-payment assistance and allocating $1,000 for administration.

The staff member, who said they had supported and sponsored the Carroll County DPA program in 2019 and 2021, described three options for the recapture funds: (1) treat the money the same way as the original Iowa Economic Development Authority grant and offer it as down-payment assistance to households at or below 80% of area median income (AMI); (2) submit the funds to the regional Housing Trust Fund and apply for a dollar-for-dollar match at the trust's September board meeting; or (3) use the money for home rehabilitation. The staff member said rehabs currently have a three-year wait list in Carroll County.

On the first option, the presenter described the administrative steps that would mirror the original program: an inspection for lead-based-paint hazards, income verification and standard DPA documentation. "We would do an inspection. We would ensure whether any lead-based paint was in such a state as it would cause an adverse effect to the homeowner," the staff member said. The presenter added that, after taking the $1,000 administration fee, $10,536 would be available for assistance.

On the second option, the presenter said a Housing Trust Fund application could double the local contribution through a dollar-for-dollar match if approved; the presenter cautioned that match-program products use different low-to-moderate-income (LMI) tiers and loan terms, meaning the assistance could become a loan rather than a forgivable grant depending on the LMI tier. "If you choose to go that way and you want to continue using the down payment assistance, it will more than likely end up being a loan to that person in lieu of a grant," the staff member said.

Supervisors discussed how the amount could fund one larger DPA award or possibly two smaller awards, given current home prices. The presenter said many callers have asked when the DPA program will return and expressed confidence the funds would be spent quickly if reallocated to the original program.

A motion to return the recaptured money to the county's down-payment-assistance fund, including the $1,000 administration allocation, was moved and seconded and approved by the board. Staff noted the county will need to amend the budget to recognize the expenditure because the funds have been held in reserves for several years.

The board did not direct a single alternate outcome; staff left the option to pursue the Housing Trust Fund match or rehabilitation uses open for future consideration.

Ending: The board approved reinvesting the recapture into the county DPA program and asked staff to handle the budget amendment and next steps; staff retained discretion to pursue a Housing Trust Fund match or rehabilitation funding later.