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Staff outlines CDBG rules for investor‑owned multiunit housing rehab; committee raises priority questions
Summary
City staff told the CDBG steering committee that rehabilitation of investor‑owned multiunit housing is an eligible CDBG activity but must meet strict occupancy, rent, subsidy and compliance requirements.
Gardner City staff presented a summary of requirements should the city pursue CDBG‑funded rehabilitation of investor‑owned multiunit housing.
Assistant Director Yuhas said eligible activities include demolition, reconstruction and rehabilitation; if CDBG funds are used for multiunit rehabilitation, at least 51% of the units must be occupied by low‑and‑moderate‑income (LMI) households. She said EOHLC enforces rent limits: the city must use the lesser of Section 8 fair market rents or HOME program rents for units assisted. The per‑unit subsidy cap discussed was $175,000. A deed restriction to maintain affordability for a minimum of 15 years is required. Staff also listed other required compliance steps: environmental review, lead‑based paint evaluation and reduction, cost reasonableness, and applicable labor and domestic‑materials rules (Davis‑Bacon and Build America, Buy America where triggered).
Committee members said they were not convinced that using CDBG funds for full gut rehabs of investor‑owned buildings is the best use of limited funds, noting that past local CDBG housing activity focused mainly on owner‑occupied rehabilitation and energy upgrades. Staff said the city would need to develop program guidelines and said EOHLC would review any proposed program design before the city adopted it.
No CDBG funds were committed for such a program at the Oct. 28 meeting; the item remained informational for future policy discussion.
