Compliance Analysis Overview

Virginia Enterprise Zone Local Zone Administrator’s Management Manual

600 E. Main Street, Suite 300 Richmond, VA 23219 (804) 371-7171 EZONE@dhcd.virginia.gov www.dhcd.virginia.govTABLE OF CONTENTS

VIRGINIA ENTERPRISE ZONE PROGRAM OVERVIEW .............................................................. 3

ZONE ADMINISTRATION AND OVERSIGHT ............................................................................ 3

LOCAL ZONE ADMINISTRATION ............................................................................................ 3

STATE INCENTIVE QUALIFICATION 4

PROVISION OF LOCAL INCENTIVES 5

MAINTAINING ZONE BOUNDARIES 5

ENTERPRISE ZONE AMENDMENT REQUIREMENTS ................................................................ 6

BOUNDARY AMENDMENTS 6

INCENTIVE AMENDMENTS 7

TYPES OF LOCAL INCENTIVES ................................................................................................ 7 LOCAL INCENTIVE CONDITIONS & ELIGIBLITY CRITERIA 9

GUIDELINES FOR DEVELOPING LOCAL ENTERPRISE ZONE INCENTIVES 9

PARTNERSHIPS AND PARTICIPATION .................................................................................... 9

PERFORMANCE EVALUATION AND INCENTIVE MONITORING .............................................. 10

ANNUAL REPORTING 10

CONSIDERATIONS FOR ZONE EVALUATION 10

PERFORMANCE MEASURES 11

MONITORING LOCAL INCENTIVES 12

MARKETING ENTERPRISE ZONES ......................................................................................... 13

GUIDELINES FOR DEVELOPING A SUCCESSFUL MARKETING PLAN 13

ZONE RENEWAL .................................................................................................................. 15

ZONE TERMINATION........................................................................................................... 16

QUESTIONS AND ASSISTANCE ............................................................................................. 17

VIRGINIA ENTERPRISE ZONE PROGRAM OVERVIEW

The Virginia Enterprise Zone (VEZ) program is a partnership between state and local government to promote economic development through job creation and real property investment. When used in conjunction with other local, state, and federal programs, enterprise zones can leverage private sector investment in targeted areas throughout Virginia. There are currently 45 designated Enterprise Zones in the Commonwealth; however, under the 2005 Enterprise Zone Grant Act the total number of zones is to be reduced to 30. The Governor has the power to designate new zones as older zones expire. Under the 2005 Grant Act, each zone is designated for an initial 10-year period and is eligible for two consecutive 5-year extensions.

Five-year extensions are based on the locality’s performance of zone administration responsibilities, the continued need for such a zone, and the zone’s effectiveness in creating jobs and capital investment. New legislation passed in 2019 allows for a third 5-year extension for each zone, effectively extending zone designations up to 25 years.

The 2005 Act also replaced the former tax credit program with two grant-based incentives; the Real Property Investment Grant (RPIG) and the Job Creation Grant (JCG). In addition to supporting the overall policy shift of the program, the current incentives reflect changes in business best practices and development trends that have occurred over the past decade.

Businesses that began qualification periods for the pre-2005 tax credit program prior to July, 2005 may complete their 10-year agreed-upon incentive period provided they continue to meet qualification requirements. By statute, the tax credits are available through fiscal year 2019.

ZONE ADMINISTRATION AND OVERSIGHT

The Virginia Enterprise Zone program is guided by the Code of Virginia and the Virginia Enterprise Zone Program Regulations. The Regulations establish specific criteria and procedures for zone administration, designation, and amendments, as well as to define the eligibility criteria for businesses and investors seeking qualification for state incentives. While the Department of Housing and Community Development (DHCD) administers the state-wide program, the day-to-day administration of a designated zone is the responsibility of the participating jurisdiction. Each locality is required to designate a Local Zone Administrator who is responsible for administering, managing, and marketing the locality’s Enterprise Zone.

LOCAL ZONE ADMINISTRATION

A Local Zone Administrator (LZA) is the chief executive of the participating jurisdiction in which the Enterprise Zone is located or his/her designee. DHCD recommends that LZAs develop a formal process for managing their zone by developing an instruction manual that includes detailed procedures on the provision of local incentives, marketing the zone (state & local incentives), a process for zone evaluation, maintaining an updated list of addresses and businesses within the zone boundaries, and procedures for meeting DHCD reporting requirements. Creating a documented process will help ensure consistent zone administration throughout the life of the zone.

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STATE INCENTIVE QUALIFICATION

It is the responsibility of the LZA to identify and assist potential Enterprise Zone applicants with the state incentive qualification process. Each year, DHCD holds regional “How to Qualify” workshops and provides LZAs with updated instruction manuals and application forms for state incentive qualification. These documents and additional information can always be found on the EZ Online Submission System site: https://dmz1.dhcd.virginia.gov/EZonePortal/.

DHCD strongly urges LZAs to attend the regional workshops for updated information on the state incentive eligibility requirements and qualification process. It is also important for LZAs to market these annual workshops to the various stakeholders within their zones including (but not limited to) local businesses, property owners, real estate agents, and Certified Public Accountants.

Real Property Investment Grant (RPIG) awards up to 20 percent of the total amount of qualified real property investments made to a building or facility, not to exceed $100,000 within a five-consecutive-year period for investments of less than $5 million. For qualified real property investments of $5 million or more, the grant is capped at $200,000 per building or facility. For rehabilitation and expansion projects, a zone investor must spend at least $100,000 in qualified real property investments to be considered eligible for the RPIG. For new construction projects, a zone investor must spend at least $500,000 to qualify for the grant. The 20 percent grant is based on investments made in excess of the $100,000 and $500,000 eligibility thresholds, respectively. Starting in 2019, solar projects of at least $50,000 may qualify for RPIG with a $0 threshold. If solar is part of a larger rehab, expansion, or new construction project, the applicable threshold will be reduced by $50,000.

Job Creation Grant (JCG) awards up to $500 per year for each net new, permanent full-time position created above a four-position threshold earning at least 175 percent of the federal minimum wage ($12.69/hour) with offered health benefits. Positions earning at least 200 percent of the federal minimum wage ($14.50/hour) with offered health benefits are eligible for a grant of $800 per year for each qualified position over the threshold. Eligible firms can receive grants for up to 350 positions per year for a period of five years. Retail, food and beverage, and personal service positions are not eligible for the JCG. As of 2010, firms in High Unemployment Areas (HUAs)1 may qualify for the JCG at a reduced wage threshold. High unemployment areas are localities with unemployment rates that are equal to or more than one and one-half times (150 percent) the state average. In such areas, the qualifying wage threshold is lowered to 150 percent of federal minimum wage ($10.88) to qualify for the $500 grant per eligible position. 1 HUAs are localities with an unemployment rate 150 percent higher than the state average.

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PROVISION OF LOCAL INCENTIVES

Localities are responsible for providing local incentives to eligible Enterprise Zone businesses and investors. Local incentives are a critical component of the Enterprise Zone Program as they provide the opportunity for the locality to tailor assistance to the direct needs of their business community. Each locality is required to offer a package of local incentives to businesses and property owners within the Enterprise Zone. Incentives offered within the Enterprise Zone should take into account locally and regionally adopted community and economic development priorities and strategies. Local incentives should complement the Job Creation and Real Property Investment Grants but are not required to be financial. Fast–track permitting, design assistance, and loan packaging assistance are examples of effective forms of local incentives that are appropriate for this program. However, funds foregone as the result of offering incentives with monetary value should be considered an investment that will strengthen the development potential of the zone by creating an enhanced business environment via job growth and improved real estate conditions. It’s important to consider the associated benefits such as an increased tax base and the potential reduction in unemployment.

DHCD recommends that LZAs develop a formal qualification process for each local incentive outlining the eligibility requirements and the roles and responsibilities of all parties involved in the qualification process (e.g., building department, assessor’s office, department of revenue).

The LZA and all involved parties at the local level should be familiar with package of the local incentives. In addition, each administrator should monitor the use of local incentives to determine if they are having the intended impact.

MAINTAINING ZONE BOUNDARIES

It is the responsibility of the LZA to maintain information regarding the boundaries of the Enterprise Zone. The LZA should keep a listing of all addresses and businesses within the boundaries of the zone. Addresses should be used to verify business location and eligibility for state and local incentives. It is also a good idea to have a legal boundary description in addition to a boundary map.

The Virginia Employment Commission (VEC) can provide the locality with a listing of all businesses registered with the VEC, what type of business activity the business performs, the number of employees, and average wage paid in each business sector. With this information, the local administrator can compile a listing of Enterprise Zone businesses. There is a charge for this material and recipients are required to sign a confidentiality agreement. Not every business is required to file with the VEC, so the list may not be all-inclusive. To request VEC information, contact the Labor Market Information Office in Richmond at (804) 786-5880. Local business license reports are another source for determining the type and number of businesses within the zone.

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ENTERPRISE ZONE AMENDMENT REQUIREMENTS

An Enterprise Zone locality may amend the boundaries and/or package of local incentives once every twelve months from the date of the last amendment. Localities must make their request to amend their zone using CAMS. DHCD will not approve an amendment application unless the zone’s local annual reports are current. Please contact the Enterprise Zone office to discuss any potential amendments.

Public Hearings are a required component for ALL amendment applications. The local governing body must hold a Public Hearing on the proposed amendment(s) prior to submitting the amendment application to DHCD. The Public Hearing must not be held more than six months prior to the amendment submission (13VAC5-112-490).

A draft of the amendment application and maps showing boundary revisions MUST be submitted for DHCD’s review prior to the Public Hearing. This initial review will allow Enterprise Zone staff to identify any issues or concerns prior to the Public Hearing, reducing the possibility of significant revisions to the final draft and the need for an additional Public Hearing.

A resolution from the local governing body approving the amendment must be submitted with the application. In the case of a joint zone, each locality participating in the joint zone (regardless of whether or not they are amending their portion of the zone) must pass an approval resolution and sign a Joint Application Agreement, Form EZ-2-JA. This form certifies that the other participating jurisdictions support the filing of the amendment request.

Public Hearing Advertisement Requirements

 Ads must be published once a week for two consecutive weeks in a newspaper of general circulation.  The final advertisement cannot be published less than five days or more than twenty-one days prior to the hearing.  The ad must give the time, date, and location of the hearing.

The complete requirements for conducting public hearings are stated in §15.2-2204, Code of Virginia.

BOUNDARY AMENDMENTS

An Enterprise Zone boundary may be amended once every twelve months from the date of the last amendment application provided the jurisdiction stays within the acreage guidelines outlined in Section 13VAC5-112-440 of the Program Regulations. Boundary amendments may include additions, deletions, or the creation of non-contiguous areas.

ADDING ZONE ACREAGE: Localities may expand the boundaries of their zones up to the maximum size as outlined in Section 13VAC5-112-440 of the program regulations. The addition cannot consist of a single site for a single business firm or be less than a total of 10 acres in size. In a joint zone, the portion of the zone in each locality must meet the minimum and maximum size requirements as outlined in the Program Regulations.

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Page 6 DELETING ZONE ACREAGE: In the case of a boundary amendment that involves the removal of designated acreage, the local governing body must notify each individual property owner and business located within the boundaries of the proposed deletion two weeks prior to holding the Public Hearing. The Local Zone Administrator must demonstrate that the boundary deletion will not have a negative impact on businesses and properties located within the area marked for deletion.

ADDING/REMOVING NON-CONTIGUOUS AREAS: Each Enterprise Zone may have up to three non-contiguous areas. The total acreage of the combined zone areas cannot be greater than the maximum zone size as outlined in Section 13VAC5-112-440 of the Program Regulations. Each participating jurisdiction in a joint zone is allowed to establish up to three non-contiguous areas.

Size Limits for Zones in Towns and Cities Size Limits for Zones in Counties

Minimum: one-quarter (1/4) square mile (160 acres). Minimum: one-half (1/2) square mile (320 acres).

Maximum: one square mile (640 acres). Maximum: six square miles (approximately 3,840 acres).

Exception: may be larger than one square mile provided it does not exceed seven percent of the locality's land Size Limits for Zones in Consolidated Cities area or it does not encompass more than seven percent of the locality’s total population. To calculate the Zones in cities where the present boundaries have been population exception, use the Weldon Cooper Centers’ created through the consolidation of a city and county most recent final (not provisional) population estimates (Chesapeake, Hampton, Newport News, and Virginia for the locality. The following is a link to the Weldon Beach) or the consolidation of two cities (Suffolk and Cooper Public Service Center: Richmond), must use the minimum and maximum size guidelines for zones in unincorporated areas of countieshttp://demographics.coopercenter.org/virginia-population-estimates/ described above.

INCENTIVE AMENDMENTS

Localities should regularly monitor the usage and effectiveness of their local incentives.

Localities should amend their incentive package if certain incentives are not being utilized or as conditions in the zone change. New incentives may be added to the package and existing incentives may be adjusted or replaced. Localities may remove a local incentive from the package if a replacement is offered. DHCD will only approve the deletion of a local incentive if the proposed replacement is equal or superior to the incentives previously offered.

TYPES OF LOCAL INCENTIVES

Participating localities are to provide a variety of financial and non-financial incentives to further encourage economic growth and investment within their Enterprise Zones. For the purposes of the Virginia Enterprise Zone Program, an incentive is any type of regulatory reform, tax exemption, service improvement, resource commitment or other activity intended to

Local Administrator’s Management Manual 2019 Page 7stimulate private sector investment or revitalization. A locality may consider any type of incentive permissible under federal and state law, provided that the incentive is targeted to the zone. An incentive that is available throughout a locality is not considered an Enterprise Zone incentive unless special affirmative conditions are provided to encourage greater use of the incentive within the boundaries of the zone than would otherwise be expected. The package of local Enterprise Zone incentives is to be determined by the local governing body. The following list is sample of frequently offered local Enterprise Zone incentives:

REAL PROPERTY TAX EXEMPTION Section 58.1-3221 of the Code of Virginia enables localities to defer the taxes on the increase in assessed value as a result of the rehabilitation of real estate for structures at least 15 years of age in Enterprise Zones, and 20 years of age elsewhere in the jurisdiction.

MACHINERY AND TOOL TAX GRANTS Grants based on the amount of machinery and tool tax paid to the locality are given to the business through the local IDA. Unlike the real property tax exemption, there is no state enabling legislation that allows localities to forgo the collection of this tax. The locality must collect the tax, but is allowed to work with the local IDA to provide a grant to zone businesses equivalent to all or a portion of the machinery and tool tax they have paid.

LOCAL TAX REBATES Rebates on local sales tax on items purchased in the community for conduct and trade of business in the Enterprise Zone.

BUSINESS LOANS Façade improvement loans for both commercial and industrial properties, low interest loan funds for start-up and expansion, revolving loan funds composed of local and private funding sources.

BUSINESS AND PROFESSIONAL OCCUPATION LICENSE FEE EXEMPTION Exemption from local licensing fees for new and existing firms.

FEE WAIVERS Waiver of permit fees, sewer and water tap fees, utility fees.

PUBLIC IMPROVEMENTS Streets, sidewalks, water and sewer systems, signage or signals, etc.

WORKFORCE SERVICES Targeted training programs or other assistance programs designed to meet business needs.

NON-FINANCIAL Fast track permitting process, loan packaging assistance, and design assistance.

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Page 8 LOCAL INCENTIVE CONDITIONS & ELIGIBLITY CRITERIA

Strategically tailoring local incentive conditions and eligibility criteria is a way localities can encourage particular activities within the zone. Conditions may be placed on the period of time the incentive is made available (ex: during the first five years of zone operation), the period of time in which a zone business can qualify to receive an incentive (ex: a three-year exemption), and eligibility criteria to receive incentives (ex: investment and/or job creation thresholds).

Eligibility requirements can be a key tool to guide development. For example, eligibility requirements can be used to target incentives to particular business sectors such as tourism or technology or businesses that pay wages above a certain rate. Generally, a locality is free to set whatever conditions it considers to be appropriate, provided that there is no conflict with federal or state law.

DHCD discourages using state incentive qualification as the eligibility criteria for local incentives. A business or investor should not be required to qualify for state incentives to be eligible for local incentives.

GUIDELINES FOR DEVELOPING LOCAL ENTERPRISE ZONE INCENTIVES

USE INCENTIVES TO ACCOMPLISH A PLAN: Incentives should be directly linked to actions that are consistent with local Enterprise Zone revitalization and development goals.

ESTABLISH PERFORMANCE BASELINES THAT PROVIDE A THRESHOLD FOR QUALIFICATION: Incentives should reward firms that make a commitment to invest in a zone by creating new jobs, investing in real property, or a combination of both.

MONITOR INCENTIVES REGULARLY: Incentives should be structured to facilitate the evaluation of their usage and return-on-investment.

CONSIDER RETURN ON INVESTMENT: Incentives should represent sound fiscal policy.

CONSIDER DESIRED OUTCOMES: Incentives should have reasonable eligibility criteria or limitations that support the localities desired outcomes (e.g., attracting businesses that pay higher wages).

PARTNERSHIPS AND PARTICIPATION

Interagency partnerships and cooperation, as well as community participation are essential to the long-term success of the local Enterprise Zone Program. There are a number of departments such as code enforcement, housing, planning, police, parks and recreation, and community development that may have activities and interests in the Enterprise Zone area.

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Page 9 Localities may also have a number of private sector organizations (financial institutions, local Main Street organizations, chambers of commerce, business and merchant associations, utility companies, real estate agencies, CPAs), or quasi-governmental agencies (housing authorities, industrial development authorities) that conduct activities in the Enterprise Zone area.

Organizing Enterprise Zone businesses around an association geared towards meeting zone needs and addressing zone interests is another element of an effective local program.

PERFORMANCE EVALUATION AND INCENTIVE MONITORING

Enterprise Zones provide a framework for the coordination of diverse activities to improve the community and economic conditions of distressed areas. The creation of an Enterprise Zone is an opportunity for localities to examine various programs and policies that focus on a host of economic and community development initiatives. Incentive monitoring and performance evaluations are valuable ways to assess the locality’s progress toward achieving stated goals and improving local performance over the life of the zone. Regular evaluation helps the locality to determine if the program is having its intended impact as the purpose of the program is to provide assistance in reaching established goals and objectives. Additionally, evaluation provides a mechanism to examine the use of local incentives. Results of regular monitoring may indicate the need for amendments or other adjustments to ensure the ongoing effectiveness of the local zone.

ANNUAL REPORTING

Localities are required to submit annual reports to DHCD for the purpose of program monitoring and evaluation. Annual reports must be submitted to DHCD through CAMS by July 15th of every year, as required by Program Regulations. Current reports must be on file before a zone may apply for boundary and/or incentive amendments. Report findings are forwarded to the Virginia General Assembly in the Enterprise Zone Program’s Annual Report. See 13VAC5-112-500 in the Program Regulations for more information about the reporting requirements.

CONSIDERATIONS FOR ZONE EVALUATION

FOCUS ON OUTCOMES: This includes reviewing progress toward achieving local goals and objectives and examining the effectiveness of individual incentives as tools to overcome identified barriers within the zone.

There are a variety of factors to review when evaluating the goals and objectives of your Enterprise Zone. Things to consider include:  Is the zone having the desired outcomes in terms of achieving local goals?  Are the goals and objectives realistic?  Is the timeframe for achieving these goals realistic?  How well do they fit into the locality's overall community and economic development strategy?

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Page 10  Could other courses of action be pursued?  What progress has been made in pursuing opportunities and resolving high priority problems?

INCLUDE NONTRADITIONAL DATA SOURCES Examples include business surveys, number of new utility connections, police data on reported criminal activity in the zone, and code violation activity by type and location within the zone.

INCLUDE QUALITATIVE FACTORS Not all impacts can be quantified, but these factors can still offer a compelling indication of the success of the zone. Include a narrative discussion of these observations.

MEASURE ZONE CHANGES OVER TIME The revitalization of an Enterprise Zone is incremental and the impacts may occur gradually throughout life of the zone. Tracking changes over time enables the locality to determine any long-term trends and subtle impacts. Public and private investment, sales tax revenues, housing activities, job creation and job losses, population, income, unemployment, job training, education, public safety, and property values are just some of the items that should be monitored over time.

DOCUMENT ZONE CHANGES WITH BEFORE AND AFTER PHOTOGRAPHS A picture is worth a thousand words and can often instantly communicate a sense of progress that numbers alone cannot.

SHOW THE BENEFITS TO THE COMMUNITY AS A WHOLE Positive changes in the zone have an impact on the community as a whole. Improving conditions in the zone have a multiplier effect as they ripple throughout the entire community.

Be sure to share achievements.

INCORPORATE THE WORK OF COMMUNITY GROUPS There are a number of public and private efforts that contribute to the revitalization of a zone.

A locality should not limit the evaluation to its own activities, but should also document the contributions of nonprofit, religious, higher education, fraternal and professional service organizations to the success of the zone as well.

PERFORMANCE MEASURES

Below is a list of suggested outcomes to track within the boundaries of your Enterprise Zone.

This list is only an example of what could be measured and is not all-inclusive. Each locality may choose any number of variables to evaluate success in the Enterprise Zone.

JOB CREATION OUTCOMES Total new jobs added, jobs retained, types of jobs (industrial, commercial, service sectors), cost per job vs. cost of creating jobs using other local, state and federal job programs.

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Page 11 BUSINESS DEVELOPMENT OUTCOMES Net new investment as a result of business expansion or relocation, micro-business creation; type and number of new start-up businesses, type and number of new jobs created.

TYPE OF FIRM (CAPITAL VERUS LABOR INTENSIVE) Track the kinds of businesses within the zone and, if possible, the skill levels they require of their employees.

LEVERAGE RATIOS OF INVESTMENT Determine foregone public revenue to private investment ratio.

IMPORTANCE OF INCENTIVES TO BUSINESSES Survey businesses to determine the significance of local incentives in business retention, expansion, or relocation.

INFRASTRUCTURE IMPROVEMENTS Track the type and amount of improvements made within the zone and compare it to the amount and type of private investment occurring during the same time period.

NEW PUBLIC FACILITIES What public facility was placed in service? What is the level of use and what is the importance of the facility within the zone over time? The local zone administrator could document this with a user survey.

IMPROVED AMENITIES AND NEIGHBORHOOD BEAUTIFICATION These types of improvements often relate to quality of life issues. It is important to track what activity has occurred and what individual, nonprofit, philanthropic, or public organization under took the activity. Measure the impact on the zone over time.

MONITORING LOCAL INCENTIVES

Local incentives are essential tools in achieving goals and objectives for the zone. It is important to consistently review whether or not the incentives have produced the desired results and if not, why not? Zone administrators need to develop a process to regularly monitor the usage of incentives and are asked to discuss this in the annual report they submit to DHCD. In addition to monitoring usage, the effectiveness of the incentives should also be evaluated on a regular basis. Below are basic categories of local incentives and suggestions for evaluating their effectiveness.

INVESTMENT INCENTIVES SUCH AS LOANS, TAX EXEMPTIONS AND GRANTS What is the public to private investment ratio (for every dollar the locality has foregone how much private investment was made)? Track the types of firms using these incentives and the corresponding job creation levels.

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CAPITAL FINANCING INCENTIVES SUCH AS LOW INTEREST DEVELOPMENT LOANS OR VENTURE CAPITAL FUNDS What types of loans are applied for most often and by what types of zone businesses? Track job creation. Track the return on investment. For every loan dollar given out how much investment is generated?

REGULATORY INCENTIVES SUCH AS RELAXED LOCAL REGULATION What regulations are most often requested for exceptions within the zone area?

PERMITTING INCENTIVES SUCH AS ONE-STOP-SHOP OR FAST TRACK PERMITTING How often is this incentive used by zone businesses?

PUBLIC SERVICE INCENTIVES SUCH AS ENHANCED POLICING OR SECURITY AUDITS Compare the costs of enhanced policing to the changes in reported crime over time in the zone area. What types of businesses get security audits and where are they principally located in the zone? What is the level of the business’s satisfaction after participating in a security audit? Has there been any change in the crime rate, or in the business’s perception of crime, or both?

EDUCATION-RELATED INCENTIVES What educational programs are most often used by businesses and what educational programs do businesses feel their workforce needs to assist them in being more competitive?

MARKETING ENTERPRISE ZONES

An Enterprise Zone designation is a useful economic development tool only to the degree that businesses are aware of the program with an understanding of how to participate. Building awareness and participation requires marketing. Each locality is responsible for marketing its Enterprise Zone. There is a direct correlation between the level of marketing and the level of business participation. The most effective marketing efforts are guided by a plan.

Essential marketing tools include comprehensive program materials such as handouts and an up-to-date website, local workshops, and enlisting strategic partners to help market the program to targeted audiences. Banks, real estate firms, utility companies, CPA firms, and the local building department are some of the partners that should be engaged in the process.

GUIDELINES FOR DEVELOPING A SUCCESSFUL MARKETING PLAN

A strong marketing plan should include long-term guidance outlining marketing objectives, stakeholders and facilitators, the necessary tools, how much money will be spent, and how marketing success will be evaluated. The marketing plan must be clear and specific about the local intent. The locality should not take the “shot gun approach”, aiming at everything and hoping something lands in the zone. Marketing resources are limited; therefore they should be targeted to businesses that are in line with the localities economic development strategy.

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Page 13 As you craft the plan, remember that marketing your zone should be a part of regional and state-wide efforts. It is extremely difficult to market a zone as a stand-alone entity. Prospects are typically interested in the attributes of the entire region rather than just those of the zone.

GENERAL MARKETING PLAN OUTLINE Who markets the Enterprise Zone?

1. Determine the objective. What is the locality trying to accomplish within the zone in terms of community Everybody! The broader your marketing team, the better your development, new jobs, business ventures and reach. Here are some potential investment? partners for your marketing efforts.

1. Collect data and take an inventory of the zone:  Local government officials and staff  Existing conditions  State government departments  Local and regional economy  CPAs, architects, realtors  Trends in the market place  Property and business owners,  Regional factors such as competition tenants  Available resources  Nonprofits, neighborhood groups  Utilities
2. Assess the zone’s environment:  Chambers of Commerce, Main Street  Assets and liabilities or downtown development  Strengths and weaknesses organizations, other key business  Key opportunities associations  Financial and educational institutions  Hospitality industry4. Develop the product and know what there is to sell:  Demographics:  SBDCs ► Who lives in the zone? Who works in the zone?  Zone inventory: ► Vacant land and buildings, rents and square footage, development and rental costs, utilities, amenities.  Business survey: ► What kinds of businesses are in the zone? Who/where are their suppliers? Why is the zone a good business location for them?

1. Identify a target market:  Geographic distribution: ► Why are businesses located there in the first place? Is it because of the site, suppliers, supply costs, or market opportunities?  Industry types: ► Consider existing businesses and look for complimentary value-added businesses, not businesses that will compete.

Local Administrator’s Management Manual 2019 Page 146. Devise a marketing strategy  Wide Net approach: ► Broad-based and general to establish an identity, offers a wide variety of benefits to all businesses.  Targeted approach: ► Targeted and specific to sell an opportunity, focuses on specific business categories or an individual company.  Amenities ► All strategies should include aspects of business retention, encouraging business start-ups, business recruitment, and the development of value-added products.

1. Develop an implementation plan:  Specify projects and task  Set deadlines for accomplishments  Delineate responsibilities  Define both short and long-term activities
2. Follow-up and evaluate marketing activities:  Follow-up on tasks and actions  Review objectives and accomplishments  Evaluate the results  Identify gaps  Redirect resources (if appropriate)

ZONE RENEWAL

Enterprise zones designated pursuant to 13VAC5-112-460 are in effect for an initial 10-year period with up to three five-year renewal periods, except as provided for in 13VAC5-112-510 and 13VAC5-112-520. Enterprise zones designated prior to July 1, 2005 are eligible for one five-year renewal. Recommendations for five-year renewals shall be based on the locality's performance of its enterprise zone responsibilities, the continued need for such a zone, and its effectiveness in creating jobs and capital investment.

In anticipation of the tenth, fifteenth, and twentieth anniversaries of an enterprise zone's designation, the locality (s) shall submit to the department on the prescribed form information regarding, but not limited to, (i) the area conditions; (ii) the continued need for the enterprise zone; (iii) its long-term effectiveness in creating jobs and capital investment. The department shall also consider the locality(s) long-term performance of enterprise zone responsibilities.” DHCD will inform each zone when they will need to submit a renewal application. These applications are non-competitive and will be submitted through CAMS.

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Page 15 ZONE TERMINATION According to Statute (§ 59.1-546) and Program Regulations (13VAC5-112-510 - 520), there are several circumstances under which DHCD may recommend an Enterprise Zone for termination:

FAILURE TO QUALIFY FOR STATE INCENTIVES: If a zone fails to have any business firms qualify for state Enterprise Zone incentives within five-consecutive-year period, DHCD shall recommend termination. Localities will not be able to rectify the situation once the five years of inactivity has elapsed.

FAILURE TO PROVIDE LOCAL PROGRAM INCENTIVES: If a locality or an assigned agent is unable or unwilling to provide any of the approved local Enterprise Zone incentives, the locality must:

1. Notify the Department in writing within 30 days of inability or unwillingness to provide approved local incentive(s).
2. Request an incentive amendment to the zone application within 60 days of sending the written notification.

The zone will remain designated if the amendment is approved. If a locality fails to provide notice, does not offer replacement incentives, or has its incentive amendment denied, the Department will recommend to the Governor that the zone be terminated. In the case of a joint zone, these procedures will apply if any participating locality or assigned agent is unable or unwilling to provide approved local incentives.

TERMINIATION EFFECT ON BUSINESS QUALIFICATION Qualified business firms located in a terminated zone may continue to request tax credits and job creation grants for any remaining years in the qualification period for which they are eligible. After the date of zone termination, no additional business firms or zone investors may apply to receive state Enterprise Zone incentives.

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QUESTIONS AND ASSISTANCE

Contact the Enterprise Zone staff at DHCD with any questions or requests for assistance.

Rebecca Rowe Program Manager Rebecca.Rowe@dhcd.virginia.gov (804) 371-7040 Tory McGowan Program Administrator Tory.McGowan@dhcd.virginia.gov (804) 371-7066 Joy Rumley Program Administrator Joy.Rumley@dhcd.virginia.gov (276) 274-3378 Virginia Department of Housing and Community Development Office of Community Revitalization and Development Main Street Centre 600 East Main Street, Suite 300 Richmond, Virginia 23219 (804) 371-7171 Ezone@dhcd.virginia.gov www.dhcd.virginia.gov Local Administrator’s Management Manual 2019

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Virginia Enterprise Zone Local Zone Administrator’s Management Manual

600 E. Main Street, Suite 300 Richmond, VA 23219 (804) 371-7171 EZONE@dhcd.virginia.gov www.dhcd.virginia.govTABLE OF CONTENTS

VIRGINIA ENTERPRISE ZONE PROGRAM OVERVIEW .............................................................. 3

ZONE ADMINISTRATION AND OVERSIGHT ............................................................................ 3

LOCAL ZONE ADMINISTRATION ............................................................................................ 3

STATE INCENTIVE QUALIFICATION 4

PROVISION OF LOCAL INCENTIVES 5

MAINTAINING ZONE BOUNDARIES 5

ENTERPRISE ZONE AMENDMENT REQUIREMENTS ................................................................ 6

BOUNDARY AMENDMENTS 6

INCENTIVE AMENDMENTS 7

TYPES OF LOCAL INCENTIVES ................................................................................................ 7 LOCAL INCENTIVE CONDITIONS & ELIGIBLITY CRITERIA 9

GUIDELINES FOR DEVELOPING LOCAL ENTERPRISE ZONE INCENTIVES 9

PARTNERSHIPS AND PARTICIPATION .................................................................................... 9

PERFORMANCE EVALUATION AND INCENTIVE MONITORING .............................................. 10

ANNUAL REPORTING 10

CONSIDERATIONS FOR ZONE EVALUATION 10

PERFORMANCE MEASURES 11

MONITORING LOCAL INCENTIVES 12

MARKETING ENTERPRISE ZONES ......................................................................................... 13

GUIDELINES FOR DEVELOPING A SUCCESSFUL MARKETING PLAN 13

ZONE RENEWAL .................................................................................................................. 15

ZONE TERMINATION........................................................................................................... 16

QUESTIONS AND ASSISTANCE ............................................................................................. 17

VIRGINIA ENTERPRISE ZONE PROGRAM OVERVIEW

The Virginia Enterprise Zone (VEZ) program is a partnership between state and local government to promote economic development via job creation and property investment. Currently, 45 zones exist; the 2005 Act reduces this to 30, with zones designated for 10 years and eligible for two 5-year extensions, with the Governor able to designate new zones as others expire.

Five-year extensions depend on zone administration performance, ongoing need, and job and investment creation. The 2019 legislation allows a third 5-year extension, extending designations up to 25 years.

The 2005 Act replaced the tax credit program with two grants: the Real Property Investment Grant (RPIG) and the Job Creation Grant (JCG). These incentives support policy shifts and reflect evolving business practices and trends.

Businesses qualifying before July 2005 for the pre-2005 tax credit program may complete their 10-year incentive if requirements are met. Tax credits are available through FY 2019.

ZONE ADMINISTRATION AND OVERSIGHT

The program is guided by the Code of Virginia and Regulations, which set criteria for zone administration, designation, and amendments, and define business and investor eligibility. DHCD oversees the statewide program, while localities assign a Local Zone Administrator responsible for zone management and marketing.

LOCAL ZONE ADMINISTRATION

A Local Zone Administrator (LZA) is the chief executive of the participating jurisdiction in which the Enterprise Zone is located or his/her designee. DHCD recommends that LZAs develop a formal process for managing their zone by developing an instruction manual that includes detailed procedures on the provision of local incentives, marketing the zone (state & local incentives), a process for zone evaluation, maintaining an updated list of addresses and businesses within the zone boundaries, and procedures for meeting DHCD reporting requirements. Creating a documented process will help ensure consistent zone administration throughout the life of the zone.

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STATE INCENTIVE QUALIFICATION

The LZA must identify and assist applicants with incentive qualification. DHCD hosts annual “How to Qualify” workshops and provides updated manuals and forms on https://dmz1.dhcd.virginia.gov/EZonePortal/.

DHCD urges LZAs to attend regional workshops for updated eligibility info and to market these to stakeholders like businesses, property owners, real estate agents, and CPAs.

RPIG awards up to 20% of qualified investments, capped at $100,000 for investments under $5M, or $200,000 for $5M+. For rehab/expansion, at least $100,000; for new construction, at least $500,000. Since 2019, solar projects ≥$50,000 qualify with a $0 threshold; if part of larger projects, thresholds reduce by $50,000.

JCG awards up to $500/year per new, full-time position above four, earning ≥175% federal minimum wage with benefits. Positions earning ≥200% qualify for $800/year. Firms can get grants for up to 350 positions over five years. Retail, food, personal services are ineligible. Since 2010, firms in HUAs (unemployment ≥150% of state average) qualify at a reduced wage threshold of 150% ($10.88/hour).

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PROVISION OF LOCAL INCENTIVES

Localities must provide incentives to eligible businesses and investors, tailored to community needs. Incentives should complement grants and include options like fast-track permitting, design aid, and loan packaging, viewing foregone funds as investments to boost development, jobs, tax base, and reduce unemployment.

DHCD recommends LZAs develop a formal qualification process for each local incentive, outlining eligibility and roles of involved parties (e.g., building dept, assessor, revenue).

LZA and local parties should be familiar with local incentives and monitor their use to assess impact.

MAINTAINING ZONE BOUNDARIES

The LZA must maintain zone boundary info, including addresses and businesses, to verify locations and eligibility, and should have legal boundary descriptions and maps.

VEC provides a list of registered businesses, activities, employees, and wages, for a fee and confidentiality agreement. Not all businesses file with VEC; local license reports are also useful.

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ENTERPRISE ZONE AMENDMENT REQUIREMENTS

Zones may be amended once every 12 months via CAMS, provided local annual reports are current. Contact the Enterprise Zone office for amendments.

Public hearings are required for all amendments, held before submission, and cannot be more than six months prior, per 13VAC5-112-490.

Draft amendment application and maps must be submitted for DHCD review before the Public Hearing to identify issues early and avoid revisions or additional hearings.

A resolution from the local governing body is required. In joint zones, each jurisdiction must approve and sign EZ-2-JA, certifying support for the amendment.

Public Hearing Advertisement Requirements

Ads must run weekly for two weeks in a general circulation newspaper. The final ad must be 5–21 days before the hearing, including time, date, and location.

Public hearing requirements are in §15.2-2204, Virginia Code.

BOUNDARY AMENDMENTS

Zone boundaries may be amended once annually, within acreage limits in 13VAC5-112-440, including additions, deletions, or non-contiguous areas.

ADDING ZONE ACREAGE: Localities may expand the boundaries of their zones up to the maximum size as outlined in Section 13VAC5-112-440 of the program regulations. The addition cannot consist of a single site for a single business firm or be less than a total of 10 acres in size. In a joint zone, the portion of the zone in each locality must meet the minimum and maximum size requirements as outlined in the Program Regulations.

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Page 6 DELETING ZONE ACREAGE: In the case of a boundary amendment that involves the removal of designated acreage, the local governing body must notify each individual property owner and business located within the boundaries of the proposed deletion two weeks prior to holding the Public Hearing. The Local Zone Administrator must demonstrate that the boundary deletion will not have a negative impact on businesses and properties located within the area marked for deletion.

ADDING/REMOVING NON-CONTIGUOUS AREAS: Each Enterprise Zone may have up to three non-contiguous areas. The total acreage of the combined zone areas cannot be greater than the maximum zone size as outlined in Section 13VAC5-112-440 of the Program Regulations. Each participating jurisdiction in a joint zone is allowed to establish up to three non-contiguous areas.

Size Limits for Zones in Towns and Cities Size Limits for Zones in Counties

Minimum: one-quarter (1/4) square mile (160 acres). Minimum: one-half (1/2) square mile (320 acres).

Maximum: one square mile (640 acres). Maximum: six square miles (approximately 3,840 acres).

Exception: may be larger than one square mile provided it does not exceed seven percent of the locality's land Size Limits for Zones in Consolidated Cities area or it does not encompass more than seven percent of the locality’s total population. To calculate the Zones in cities where the present boundaries have been population exception, use the Weldon Cooper Centers’ created through the consolidation of a city and county most recent final (not provisional) population estimates (Chesapeake, Hampton, Newport News, and Virginia for the locality. The following is a link to the Weldon Beach) or the consolidation of two cities (Suffolk and Cooper Public Service Center: Richmond), must use the minimum and maximum size guidelines for zones in unincorporated areas of countieshttp://demographics.coopercenter.org/virginia-population-estimates/ described above.

INCENTIVE AMENDMENTS

Localities should regularly monitor incentive usage and effectiveness.

Localities should amend incentive packages if unused or conditions change. New incentives can be added, and existing ones adjusted or replaced. DHCD approves deletions only if replacements are equal or better.

TYPES OF LOCAL INCENTIVES

Participating localities shall provide financial and non-financial incentives to promote growth and investment. Incentives include reforms, tax exemptions, service improvements, or resource commitments.

Incentives should stimulate private investment or revitalization and be law-permissible, targeted to the zone. Incentives available citywide are not zone incentives unless specially conditioned. The local governing body determines the incentive package. Examples include:

Real Property Tax Exemption: Virginia Code §58.1-3221 allows localities to defer taxes on assessed value increases from rehabilitating structures at least 15 years old in Enterprise Zones and 20 years elsewhere.

MACHINERY AND TOOL TAX GRANTS Grants based on the amount of machinery and tool tax paid to the locality are given to the business through the local IDA. Unlike the real property tax exemption, there is no state enabling legislation that allows localities to forgo the collection of this tax. The locality must collect the tax, but is allowed to work with the local IDA to provide a grant to zone businesses equivalent to all or a portion of the machinery and tool tax they have paid.

Local Tax Rebate: Rebates on local sales tax for items purchased within the Enterprise Zone for business activities.

Business Loans: Façade improvement loans, low-interest startup and expansion loans, and revolving funds from local and private sources.

BUSINESS AND PROFESSIONAL OCCUPATION LICENSE FEE EXEMPTION Exemption from local licensing fees for new and existing firms.

Fee Waivers: Permit, sewer, water, and utility fees waived.

Public Improvements: Streets, sidewalks, water/sewer systems, signage, signals, etc.

Workforce Services: Targeted training and assistance programs for business needs.

Non-Financial Incentives: Fast-track permitting, loan packaging, and design assistance.

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Page 8 LOCAL INCENTIVE CONDITIONS & ELIGIBLITY CRITERIA

Localities can tailor incentive conditions and eligibility to encourage activities, specify timeframes for incentives (e.g., first five years), and set qualification criteria (e.g., investment or job thresholds).

Eligibility requirements guide development, targeting incentives to sectors like tourism or tech, or wage levels, within legal limits.

DHCD discourages using state incentive qualification as a condition for local incentives; businesses should not need state qualification to qualify locally.

GUIDELINES FOR DEVELOPING LOCAL ENTERPRISE ZONE INCENTIVES

Use incentives to achieve local Enterprise Zone revitalization and development goals through actions aligned with the plan.

Establish performance baselines to reward firms investing in the zone via job creation, property investment, or both.

Monitor incentives regularly to evaluate usage and return on investment.

CONSIDER RETURN ON INVESTMENT: Incentives should represent sound fiscal policy.

Consider desired outcomes; incentives should have criteria supporting goals like attracting higher-wage businesses.

PARTNERSHIPS AND PARTICIPATION

Interagency cooperation and community participation are vital for long-term success, involving departments like code enforcement, housing, planning, police, parks, and community development.

Local Administrator’s Management Manual 2019

Localities may have private sector organizations (financial institutions, Main Street groups, chambers, business associations, utilities, real estate, CPAs) or quasi-governmental agencies (housing, industrial authorities) operating in the Enterprise Zone.

Organizing Enterprise Zone businesses into an association addressing zone needs is another key element of an effective program.

PERFORMANCE EVALUATION AND INCENTIVE MONITORING

Enterprise Zones provide a framework for the coordination of diverse activities to improve the community and economic conditions of distressed areas. The creation of an Enterprise Zone is an opportunity for localities to examine various programs and policies that focus on a host of economic and community development initiatives. Incentive monitoring and performance evaluations are valuable ways to assess the locality’s progress toward achieving stated goals and improving local performance over the life of the zone. Regular evaluation helps the locality to determine if the program is having its intended impact as the purpose of the program is to provide assistance in reaching established goals and objectives. Additionally, evaluation provides a mechanism to examine the use of local incentives. Results of regular monitoring may indicate the need for amendments or other adjustments to ensure the ongoing effectiveness of the local zone.

ANNUAL REPORTING

Localities must submit annual reports to DHCD via CAMS by July 15 for monitoring and evaluation. Reports are required before zone boundary or incentive amendments and are forwarded to the General Assembly. See 13VAC5-112-500 for details.

CONSIDERATIONS FOR ZONE EVALUATION

Focus on outcomes by reviewing progress toward goals and evaluating the effectiveness of incentives in overcoming zone barriers.

There are a variety of factors to review when evaluating the goals and objectives of your Enterprise Zone. Things to consider include:  Is the zone having the desired outcomes in terms of achieving local goals?  Are the goals and objectives realistic?  Is the timeframe for achieving these goals realistic?  How well do they fit into the locality's overall community and economic development strategy?

Local Administrator’s Management Manual 2019

Consider if other actions are possible and assess progress in pursuing opportunities and solving priority issues.

Include nontraditional data sources such as business surveys, new utility connections, police reports, and code violations by type and location.

Include qualitative factors; while not all impacts are quantifiable, narratives can indicate zone success.

Measure zone changes over time to track long-term trends in investments, sales tax, housing, jobs, population, income, unemployment, safety, and property values.

Use before-and-after photos to visually document zone changes and progress.

Highlight how zone improvements benefit the entire community through positive ripple effects.

Be sure to share achievements.

Incorporate contributions from public and private community groups involved in revitalization.

Localities should document contributions from nonprofits, religious, educational, fraternal, and professional organizations to zone success.

PERFORMANCE MEASURES

Below are suggested outcomes to track within your Enterprise Zone.

This list is only an example of what could be measured and is not all-inclusive. Each locality may choose any number of variables to evaluate success in the Enterprise Zone.

Job creation outcomes include new jobs, retained jobs, job types (industrial, commercial, service), and cost per job compared to other programs.

Local Administrator’s Management Manual 2019

Business development outcomes include net new investment, micro-business creation, new startups, and new jobs.

Track business types (capital vs. labor-intensive) and employee skill levels within the zone.

Determine the ratio of foregone public revenue to private investment.

Survey businesses to assess the importance of local incentives for retention, expansion, or relocation.

Track infrastructure improvements and compare with private investment during the same period.

Document new public facilities, usage levels, and importance over time, possibly via user surveys.

Track improvements in amenities and beautification, noting activities by organizations and their impact over time.

MONITORING LOCAL INCENTIVES

Local incentives are vital; regularly monitor and evaluate their usage and effectiveness, discussing findings in annual reports. Categories include various incentive types.

Track investment incentives (loans, tax exemptions, grants), public-private investment ratios, firm types, and job creation levels.

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Track capital financing incentives (low-interest loans, venture capital), loan types, business types, job creation, ROI, and investment generated per loan.

Track frequently requested regulatory exceptions within the zone.

PERMITTING INCENTIVES SUCH AS ONE-STOP-SHOP OR FAST TRACK PERMITTING How often is this incentive used by zone businesses?

PUBLIC SERVICE INCENTIVES SUCH AS ENHANCED POLICING OR SECURITY AUDITS Compare the costs of enhanced policing to the changes in reported crime over time in the zone area. What types of businesses get security audits and where are they principally located in the zone? What is the level of the business’s satisfaction after participating in a security audit? Has there been any change in the crime rate, or in the business’s perception of crime, or both?

EDUCATION-RELATED INCENTIVES What educational programs are most used by businesses, and what do they need to be more competitive?

MARKETING ENTERPRISE ZONES

An Enterprise Zone is effective only if businesses are aware and understand how to participate. Building awareness requires marketing, which each locality is responsible for. Effective marketing is plan-guided.

Essential marketing tools include program materials, a website, local workshops, and strategic partners like banks, real estate, utilities, CPA firms, and building departments.

GUIDELINES FOR DEVELOPING A SUCCESSFUL MARKETING PLAN

A strong marketing plan should include objectives, stakeholders, tools, budget, and success metrics. It must be clear and targeted, not a shotgun approach, focusing on aligned businesses.

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Page 13 When crafting the plan, remember zone marketing should align with regional and state efforts. Prospects prefer regional attributes over just the zone.

GENERAL MARKETING PLAN OUTLINE Who markets the Enterprise Zone?

1. Determine the objective. What is the locality trying to accomplish within the zone in terms of community Everybody! The broader your marketing team, the better your development, new jobs, business ventures and reach. Here are some potential investment? partners for your marketing efforts.

1. Collect data and take an inventory of the zone:  Local government officials and staff  Existing conditions  State government departments  Local and regional economy  CPAs, architects, realtors  Trends in the market place  Property and business owners,  Regional factors such as competition tenants  Available resources  Nonprofits, neighborhood groups  Utilities
2. Assess the zone’s environment:  Chambers of Commerce, Main Street  Assets and liabilities or downtown development  Strengths and weaknesses organizations, other key business  Key opportunities associations  Financial and educational institutions  Hospitality industry4. Develop the product and know what there is to sell:  Demographics:  SBDCs ► Who lives in the zone? Who works in the zone?  Zone inventory: ► Vacant land and buildings, rents and square footage, development and rental costs, utilities, amenities.  Business survey: ► What kinds of businesses are in the zone? Who/where are their suppliers? Why is the zone a good business location for them?

1. Identify a target market:  Geographic distribution: ► Why are businesses located there in the first place? Is it because of the site, suppliers, supply costs, or market opportunities?  Industry types: ► Consider existing businesses and look for complimentary value-added businesses, not businesses that will compete.

Local Manual 2019 p.146. Devise a marketing strategy: Wide Net (broad, benefits all), Targeted (specific categories or companies). Strategies should include retention, startups, recruitment, and value-added development.

1. Develop an implementation plan:  Specify projects and task  Set deadlines for accomplishments  Delineate responsibilities  Define both short and long-term activities
2. Follow-up and evaluate marketing activities:  Follow-up on tasks and actions  Review objectives and accomplishments  Evaluate the results  Identify gaps  Redirect resources (if appropriate)

ZONE RENEWAL

Enterprise zones designated pursuant to 13VAC5-112-460 are in effect for an initial 10-year period with up to three five-year renewal periods, except as provided for in 13VAC5-112-510 and 13VAC5-112-520. Enterprise zones designated prior to July 1, 2005 are eligible for one five-year renewal. Recommendations for five-year renewals shall be based on the locality's performance of its enterprise zone responsibilities, the continued need for such a zone, and its effectiveness in creating jobs and capital investment.

In anticipation of the tenth, fifteenth, and twentieth anniversaries of an enterprise zone's designation, the locality (s) shall submit to the department on the prescribed form information regarding, but not limited to, (i) the area conditions; (ii) the continued need for the enterprise zone; (iii) its long-term effectiveness in creating jobs and capital investment. The department shall also consider the locality(s) long-term performance of enterprise zone responsibilities.” DHCD will inform each zone when they will need to submit a renewal application. These applications are non-competitive and will be submitted through CAMS.

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Page 15 ZONE TERMINATION: Under § 59.1-546 and 13VAC5-112-510-520, DHCD may recommend zone termination under certain circumstances.

FAILURE TO QUALIFY FOR STATE INCENTIVES: If no firms qualify for five consecutive years, DHCD will recommend termination. Localities cannot rectify after five years.

FAILURE TO PROVIDE LOCAL INCENTIVES: If a locality or agent cannot or will not provide approved incentives, the locality must:

1. Notify the Department in writing within 30 days of inability or unwillingness to provide approved local incentive(s).
2. Request an incentive amendment within 60 days of written notification.

The zone remains if amendments are approved. If no notice, no replacement incentives, or amendments are denied, DHCD will recommend termination. Procedures apply to all localities in joint zones.

TERMINIATION EFFECT ON BUSINESS QUALIFICATION Qualified business firms located in a terminated zone may continue to request tax credits and job creation grants for any remaining years in the qualification period for which they are eligible. After the date of zone termination, no additional business firms or zone investors may apply to receive state Enterprise Zone incentives.

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QUESTIONS AND ASSISTANCE

Contact DHCD Enterprise Zone staff for questions or assistance.

Rebecca Rowe (Program Manager): Rebecca.Rowe@dhcd.virginia.gov, (804) 371-7040; Tory McGowan (Admin): Tory.McGowan@dhcd.virginia.gov, (804) 371-7066; Joy Rumley (Admin): Joy.Rumley@dhcd.virginia.gov, (276) 274-3378; DHCD, Main Street Centre, 600 E Main St, Richmond VA 23219; (804) 371-7171; Ezone@dhcd.virginia.gov; www.dhcd.virginia.gov Local Administrator’s Management Manual 2019

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Virginia Broadband Availability Map

Internet Service Provider Service Territory

Data Submission Guidelines

Bryan W. Horn Director

Tamarah Holmes, Ph.D.

Director, Office of Broadband

• Page 2 ---

Virginia Broadband Availability Map Internet Service Provider Service Territory Data

Submission Guidelines

Draft for Public Comment

Section P of Item 115 of Chapter 2, 2022 Acts of Assembly, 2022 Special Session 1, commonly known as the Budget Bill, directs the Department of Housing and Community Development (DHCD) to develop a statewide broadband availability map indicating broadband coverage, including maximum broadband speeds available in service territories in the Commonwealth. As directed in the Budget Bill, all broadband service providers shall be required to submit updated service territory data to the Department annually, containing the locations to which they provide broadband service.

Pursuant to budget bill language, the Department may publish only anonymized versions of the map, showing serviceable and unserviceable by broadband without reference to any specific provider. The map shall not include information regarding ownership or control over the network or networks providing service. Information submitted by a broadband provider in connection with

this section shall be excluded from the requirements of the Virginia Freedom of Information Act (§ 2.2-3700 et seq.). Information submitted by a broadband provider pursuant to this section shall be used solely for the purposes stated under this section and shall not be released by the Department, or any other public records custodian, without the express written permission of the submitting broadband provider.

Data Submission Requirements Pursuant to budget bill language, broadband providers shall be required to submit updated service

territory data to the Department annually. Also, in no instance may the Department require broadband providers to submit any data, in either substantive content or form, beyond that which the provider is required to submit to the Federal Communications Commission (FCC) pursuant to the federal Broadband Deployment Accuracy and Technological Availability Act, 47 U.S.C. § 641 et. seq. Service territory data includes where the provider has actually built out their broadband network infrastructure and is able to provide that service through a standard broadband installation.1 Broadband providers include terrestrial fixed, mobile or fixed wireless, or satellite2 providing broadband internet access service and includes entities required to provide the federal government

as part of the federal Digital Opportunity Data Collection program pursuant to 47 U.S.C. § 214(e)(6) for any portion of the Commonwealth.

1 As referenced in Public Law 116-130, commonly known as the “Broadband Deployment Accuracy and Technological Availability Act” a standard broadband installation means the initiation by a provider of fixed broadband internet access service in an area where the provider has not previously offered that service, with no charges or delays attributable to the extension of the network of the provider; and includes the initiation of fixed broadband internet access service through routine installation that can be completed not later than 10 business days after the date on which the service request is submitted. 2 Satellite-based broadband providers that have been designated as an eligible telecommunications carrier pursuant to 47 U.S.C. § 214(e)(6) for any portion of the Commonwealth shall be required to submit comparable data as other broadband providers

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The data submitted must meet the requirements established in the federal Broadband DATA Act

(Act, 47 U.S.C. § 641 et. seq.), as outlined in these guidelines, and include granular service territory data.

This data must be the same, in substance and in form, as submitted to the Federal Communications Commission under its Broadband Data Collection Program by their March 1, 2024 submission deadline for service territory data reflecting service availability on December 31, 2023.

This data must be submitted to the Broadband Data Submission Portal by March 5, 2024.

Failure to submit data by this deadline may result in supplemental action by the Commonwealth of Virginia.

Assistance with data submission is available from the DHCD Office of Broadband and CGIT at the contact emails below. After submission, providers will be notified of a successful submission once the data has been verified to be functional. Once the coverage data is published on the state broadband map there will be an opportunity for the public, government entities, and third parties to petition the accuracy of the data.

Permissions for Data Usage

By submitting service territory data for the purposes of this process, internet service providers also permit DHCD to use the data submitted for the purpose of challenging broadband availability mapping data under the Federal Communications Commission’s Broadband Data Collection (BDC) program.

Requirements of Petitioning Inaccuracies in the Commonwealth Connection:

Internet service providers may petition DHCD to correct inaccuracies in the Commonwealth Connection map. Two processes are outlined below for petitioning inaccuracies. These two processes are for the purpose of (1) petitioning inaccuracies in an internet provider’s own service territory, as well as (2) petitioning inaccuracies in service territory data as depicted on the Commonwealth Connection Map. Prior to submitting a petition under either process, DHCD strongly encourages petitioners to contact DHCD staff at broadband@dhcd.virginia.gov.

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Petitioning Inaccuracies on an Internet Service Provider’s own Service Territory Data

Internet service providers wishing to petition DHCD to correct inaccuracies in their own service coverage data as displayed on the map should contact both emails listed under the Contact Information section of this document. Petitions under this category must be received by DHCD by July 1, 2024 to be considered. These petitions must include a cover letter explaining the alleged inaccuracies in the data as displayed on the Commonwealth Connection map, and if necessary, an

updated submission in accordance with the requirements outlined under these guidelines. Any determination made by the department pursuant to any specific petition under this section with respect to any specific map to correct inaccuracies shall be final and not subject to further review.

DHCD will update the Commonwealth Connection map reflecting these petitions by September 1, 2024.

Petitioning Inaccuracies on Service Territory Data as depicted on the map Internet service providers seeking to petition DHCD to correct inaccuracies in service territory data as displayed on the Commonwealth Connection Map must submit the information required

below to initiate the petition process to both email addresses listed under the Contact Information section of this document. DHCD must receive all of the information detailed below or the petition will be deemed incomplete and invalid. Petitioners must provide: ● A cover letter explaining the justification for the petition ● A signed and notarized affidavit affirming the petition and attached information is true. ● Point shapefiles that show each location in the petitioned area, designated by a singular

mapped point, in the petitioned area containing attribute data showing the addresses of each point; or, Polygon shapefiles delineating the general petitioned area(s). These files must be provided in .zip file form and must be in alignment with the shapefile guidelines provided above under the Data Submission Requirements Section. Locations in the petitioned area may also be submitted as a list of VGIN ID points in a comma delimited text file (.csv), so long as their formatting conforms to the CSV and Shapefile Guidelines. Note: Point and polygon shapefiles submitted with petitions are subject to the Freedom of Information Act and will not be provided FOIA exemption. ● Petitioners must, for a minimum of at least 50% of locations in the petitioned area, provide

written justification for the basis of the petition. DHCD requires petitioners to conduct speed tests on at least 20% of locations in the petitioned area to justify assertions included in the petition. DHCD prefers speed tests to be conducted at the access point (i.e. customer premise equipment, router, or modem) at the end-user location.

Petitions under this category must be received by DHCD by July 1, 2024 to be considered. DHCD will review all applicable petition information to determine if a petition is credible. If deemed credible, DHCD will notify internet service providers which purported service coverage in the petitioned area by July 15, 2024.

DHCD will provide the opportunity for internet service providers which purported service coverage in the petition area to submit a rebuttal to the petition. If planning to submit a rebuttal, internet service providers must notify DHCD of this intent by July 22, 2024. Upon this notification, DHCD will provide at a minimum, the cover letter, affidavit, and shapefiles

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submitted with the petition to internet service providers seeking to submit a rebuttal. All rebuttal information must be submitted to DHCD by August 22, 2024. Information submitted to contest a petition is at the discretion of the internet service provider submitting the rebuttal. All information submitted in the rebuttal process by an internet service provider shall be considered voluntarily submitted by that internet service provider.

If a petition is not rebutted, DHCD will make a determination based upon the information submitted in the petition. Any determination made by the department pursuant to any specific petition under this section with respect to any specific map to correct inaccuracies shall be final and not subject to further review. DHCD will update the Commonwealth Connection map reflecting petition determinations by September 1, 2024 and notify internet service providers of the determination by this date.

Contact Information: DHCD Office of Broadband: broadband@dhcd.virginia.gov

VT Center for Geospatial Information Technology: cgitsupport@vt.edu

• Page 1 ---

Virginia Broadband Availability Map

Internet Service Provider Service Territory

Data Submission Guidelines

Bryan W. Horn Director

Tamarah Holmes, Ph.D.

Director, Office of Broadband

• Page 2 ---

Virginia Broadband Availability Map Internet Service Provider Service Territory Data

Submission Guidelines

Draft for Public Comment

Section P of Item 115 of Chapter 2, 2022 Acts, directs DHCD to develop a statewide broadband map showing coverage and speeds. All providers must annually submit updated service territory data with locations served.

Per budget bill, the Department may publish only anonymized maps showing serviceable and unserviceable areas without provider or ownership details. Data submitted by providers in connection with

Data submitted under this section is exempt from FOIA (§ 2.2-3700) and shall only be used for this purpose, not released without provider’s written permission.

Broadband providers must submit updated service territory data annually, per budget bill language.

Data must match FCC submissions under the Broadband Deployment Accuracy and Technological Availability Act (47 U.S.C. § 641). It includes locations where providers have built infrastructure capable of standard broadband service, including terrestrial fixed, mobile, wireless, or satellite providers required for federal data collection.

This includes data collected under the federal Digital Opportunity Data Collection program (47 U.S.C. § 214(e)(6)).

Per Public Law 116-130, a standard broadband installation is the initiation of fixed broadband service in an unserved area, completed within 10 business days. Satellite providers designated as eligible carriers must submit comparable data.

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Submitted data must meet the federal Broadband DATA Act requirements.

(Act, 47 U.S.C. § 641 et. seq.), as outlined in these guidelines, and include granular service territory data.

Data must match FCC submissions for the March 1, 2024 deadline, reflecting December 31, 2023 service availability.

Data must be submitted to the Broadband Data Portal by March 5, 2024.

Failure to submit by deadline may lead to action by Virginia.

Assistance is available from DHCD Office of Broadband and CGIT. Providers will be notified upon verification. After publication, the public and entities can petition data accuracy.

Permissions for Data Usage

By submitting data, ISPs permit DHCD to use it for challenging broadband mapping under FCC’s BDC program.

Petitioning Inaccuracies in the Commonwealth Connection:

ISPs may petition DHCD to correct map inaccuracies in their own service territory or the overall map. Contact DHCD staff at broadband@dhcd.virginia.gov before submitting.

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Petitions to correct ISP’s own service territory data

ISPs must contact the listed emails to petition map inaccuracies in their service data by July 1, 2024, including a cover letter explaining the issues.

updated submission in accordance with the requirements outlined under these guidelines. Any determination made by the department pursuant to any specific petition under this section with respect to any specific map to correct inaccuracies shall be final and not subject to further review.

DHCD will update the map by September 1, 2024, reflecting petitions.

ISPs petitioning DHCD to correct map data inaccuracies must submit required information.

below to initiate the petition process to both email addresses listed under the Contact Information section of this document. DHCD must receive all of the information detailed below or the petition will be deemed incomplete and invalid. Petitioners must provide: ● A cover letter explaining the justification for the petition ● A signed and notarized affidavit affirming the petition and attached information is true. ● Point shapefiles that show each location in the petitioned area, designated by a singular

mapped point, in the petitioned area containing attribute data showing the addresses of each point; or, Polygon shapefiles delineating the general petitioned area(s). These files must be provided in .zip file form and must be in alignment with the shapefile guidelines provided above under the Data Submission Requirements Section. Locations in the petitioned area may also be submitted as a list of VGIN ID points in a comma delimited text file (.csv), so long as their formatting conforms to the CSV and Shapefile Guidelines. Note: Point and polygon shapefiles submitted with petitions are subject to the Freedom of Information Act and will not be provided FOIA exemption. ● Petitioners must, for a minimum of at least 50% of locations in the petitioned area, provide

written justification for the petition basis. DHCD requires speed tests on at least 20% of locations in the petitioned area to justify assertions. Speed tests are preferred at the access point (customer premise equipment, router, or modem) at the end-user location.

Petitions must be received by DHCD by July 1, 2024, to be considered. DHCD will review all information to determine credibility. If credible, DHCD will notify ISPs of service coverage in the petitioned area by July 15, 2024.

DHCD will allow ISPs with coverage in the petition area to submit rebuttals. ISPs must notify DHCD of intent by July 22, 2024. DHCD will then provide the cover letter, affidavit, and shapefiles

• Page 5 ---

Rebuttal information must be submitted to DHCD by August 22, 2024. Submission is at the ISP's discretion and shall be considered voluntary.

If unrebutted, DHCD will decide based on petition info. Final determinations are not reviewable. DHCD will update the map and notify ISPs by September 1, 2024.

Contact Information: DHCD Office of Broadband: broadband@dhcd.virginia.gov

VT Center for Geospatial Information Technology: cgitsupport@vt.edu

• Page 1 ---

Continuing Education Policy Applicable to BHCD Certified Code Enforcement Personnel Effective May 01, 2008

Updated: October 1, 2012

Overview: The Jack A. Proctor Virginia Building Code Academy (JPVBCA) currently provides a comprehensive basic or advanced functional level of training to the state’s code enforcement personnel, generally in the first 12 to18 months of their position hire or appointment date. As the field of code enforcement increases its professional capacity, so does the need for participation in a higher competency level of training, professional career development opportunities, and ongoing skill development activities. The establishment of continuing education requirements and the receipt of attendance credit encourage and support professional advancement, and thus enhance the proficiency capability of the individual and the professional capacity of both the code enforcement community and the locality.

Regulatory Requirement and Guideline: Effective May 01, 2008, the Department of Housing and Community Development (DHCD or Department) shall require continuing education as a component of maintaining compliance with the state regulations relative to certain certifications granted by the Board of Housing and Community Development (BHCD). All building officials, property maintenance officials, and technical assistants employed by a jurisdiction to enforce the Virginia Uniform Statewide Building Code (USBC) as well as local building department personnel certified to enforce the Virginia Amusement Device Regulations (VADR) shall obtain 16 hours of continuing education every two years in addition to the mandatory and/or periodic training required for certificate issuance and maintenance. The 16 hour requirement shall be prompted at the issuance of the first certificate and shall be applicable regardless of the number of BHCD certificates held by the individual. Credit for acceptable continuing education programs and courses shall be granted on an hour received for an hour attended credit basis. A maximum of eight credit hours may be accrued per individual course or activity within a two year requirement period. The retroactive or advance accumulation of credit hours shall not be permitted or accepted. Compliance records of individual certificate holders shall be maintained by the Department through the JPVBCA.

Compliance: Compliance with the continuing education requirements, including the assurance of program content and credit hours, shall be the responsibility of the individual certificate holder. It is highly recommended that the local building department or locality monitor the compliance of their certified code enforcement personnel. The JPVBCA shall maintain compliance records and provide data reports of individual certificate holders regarding compliance with continuing education requirements upon request and as necessary. Failure to comply with the continuing education requirements or to accumulate the required credit hours within the continuing education period shall result in an inactive certification status of the certificate holder.

Documentation: The certificate holder shall be required to submit proof of compliance with the continuing education requirements in a format determined and specified by the Department JPVBCA and within 30 days of the completion of the two year continuing education period. A single submission documenting only the minimum required 16 credit hours shall be submitted to the Department once per every two year requirement period. The certificate holder shall be required to submit record of the satisfactorily completed continuing education requirements; including the associated program provider, program content, and credit hours on a prescribed application form issued by the Department and/or by electronic entry as On-line Registration System is developed and is permissible. The certificate holder shall be required to submit the appropriate substantiating documentation, including verification of program content, confirmation of attendance, certificate of completion, and/or other evidence of compliance, and to attach all associated documentation to the application form or electronic entry. All records shall be subject to further review by the Department and potential denial should program content and/or designated credit hours not meet the continuing education requirements.

Verification: A periodic audit of documentation and programs shall be conducted by the Department JPVBCA based upon a random selection and schedule. A certificate holder may be required to substantiate their declared continuing education with additional training documentation that affirm and support the program, course, or activity as requested by the Department, including education provider information, course syllabus, attendance history, and participation certificates. Therefore, it shall be the responsibility of the certificate holder to retain and maintain all necessary documentation relative to the continuing education program or course for which approval and credit is sought.

Tracking: Individual compliance with the continuing education requirements shall be documented and tracked in the Department On-line Registration System electronic database, which is available for viewing through each user profile. It is highly recommended that the local building department or locality track the compliance of their certified code enforcement personnel.

Implementation Schedule: The 16 hour requirement shall be prompted at the issuance of the first certificate and shall be applicable regardless of the number of BHCD certificates held by the individual. All documentation shall be due to the Department JPVBCA office in accordance with the following schedule.

Updated 10/1/12

• Page 2 ---

Individuals having last names beginning with A through M are due 16 hours, collected over the 24 month period May 1 – April 30 due no later than 30 days after May 01 of the even year;

Individuals having last names beginning with N through Z – are due 16 hours, collected over the 24 month period May 1 – April 30, no later than 30 days after May 01 of the odd year.

In the case of an individual receiving their initial certification during the continuing education cycle, the following exception shall apply toward the credit hour requirement. Based on the date of initial certification and the months remaining in the continuing education period, and in accordance with the above schedules, the following credit hours shall be obtained in the initial continuing education period.

Individuals having 12 months or less remaining in the continuing education period – up to 8 credit hours;

Individuals having 13 months or more remaining in the continuing education period – up to 16 credit hours.

Acceptable Programs, Courses, and Activities: Acceptable continuing education shall constitute professional development for a certificate holder, advancing or enhancing knowledge, skills, and abilities in the applicable field(s) of certification or position and relative to the code, code enforcement, code related issues, or function of position. Acceptable program and course content may relate to, although not be limited to, architectural design, engineering systems, building construction, technical trades, fire protection, fire prevention, property maintenance, construction management, code enforcement, and public administration. The pre-approval of programs and specific courses not categorized or included herein is not offered by the Department. Any programs, courses, and activities not categorized or listed are subject to review and approval, including random audit, by the Department. The certificate holder must comply with the application process as defined by the Department.

Program attendees must adhere to the program procedures required by the education provider to document attendance and receive credit and additionally shall provide such documentation to the Department. The following code and code enforcement related programs, courses, and activities shall be accepted toward the obtainment of the continuing education requirements on an hour received for an hour attended credit basis.

DHCD JPVBCA courses not required for certification;

Prince William County (PWC) Code Academy courses not required for certification;

Fairfax County (FFX) Code Academy courses not required for certification;

Jurisdictional in-service educational events and training programs;

State, national, and federal training programs;

State and governmental agency provided or sponsored training programs;

State and national code organization conferences and seminars;

State and national code development committees and hearings;

State and national code related review and advisory committee, commission, and board service;

State and national association or organization sponsored educational events and training programs;

State and national professional association or organization leadership and/or active attending membership;

State and national professional society and trade organization educational events and training programs;

National standards developing organization training programs;

Construction product, product manufacturer or distributor, or service provider training programs;

Industry site or field installation training programs;

Accredited academic institution programs and courses, i.e. college, university, and trade, technical, and vocational schools;

Web-based, on-line, self-study computer training programs;

Platform instruction;

Publication of articles.

Non-acceptable Programs, Courses, and Activities: The following programs, courses, and activities shall not be accepted toward the obtainment of the continuing education requirements.

Any programs, courses, and activities not relative to the code, code enforcement, and code related issues shall not be considered acceptable.

DHCD JPVBCA courses required for issuance of certification, including core, advanced, and applicable technical modules;

Prince William County (PWC) Code Academy courses required for certification;

Fairfax County (FFX) Code Academy courses required for certification;

DHCD JPVBCA code update training courses required for maintenance of certification;

Community service and volunteer or compensated fieldwork.

Credit Hours: Credit hours shall be granted to the accepted programs, courses, and activities based upon one credit hour for one contact hour, and shall not exceed eight credit hours per individual course or activity per each two year requirement period. The retroactive or advance accumulation of credit hours shall not be permitted or accepted.

Updated 10/1/12

• Page 1 ---

Continuing Education Policy Applicable to BHCD Certified Code Enforcement Personnel Effective May 01, 2008

Updated: 10/1/12

Overview: JPVBCA provides basic or advanced training to code enforcement personnel within 12-18 months of hire. Continuing education promotes professional growth and enhances individual and community capacity.

Effective May 01, 2008, DHCD requires 16 hours of biennial continuing education for building officials, property maintenance officials, technical assistants, and VADR-certified personnel, with records maintained by JPVBCA. Credit is hour-for-hour, max 8 hours per course, no retroactive credit.

Compliance: Certificate holders are responsible for compliance, with local departments encouraged to monitor. JPVBCA maintains records and reports, and non-compliance results in inactive status.

Documentation: Certificate holders must submit proof of 16 credits within 30 days after each 2-year period, including provider, content, and hours, with documentation for review. One submission per cycle.

Verification: JPVBCA will randomly audit documentation; certificate holders must retain proof supporting their credits, including provider info, syllabus, attendance, and certificates.

Tracking: Compliance is tracked in the Department online system; local departments are encouraged to monitor their personnel.

Implementation Schedule: The 16-hour requirement applies at initial certification, regardless of certificate count; documentation is due per schedule.

Updated 10/1/12

• Page 2 ---

A–M last names: 16 hours over May 1–April 30, due within 30 days after May 1 of even years.

N–Z last names: 16 hours over May 1–April 30, due within 30 days after May 1 of odd years.

Initial certification during a cycle allows a prorated credit hour requirement based on remaining months, per schedule.

Remaining 12 months or less: up to 8 credits.

Remaining 13+ months: up to 16 credits.

Acceptable continuing education enhances knowledge in fields like design, engineering, construction, fire, property maintenance, code enforcement, and admin. Pre-approval is not provided; unlisted programs are subject to review.

Attendees must follow provider procedures to document attendance; approved programs count hour-for-hour toward credits.

DHCD JPVBCA courses not required for certification;

PWC Code Academy courses are not required for certification.

Fairfax County (FFX) Code Academy courses not required for certification;

Jurisdictional in-service educational events and training programs;

State, national, and federal training programs;

State and agency-sponsored training programs are accepted.

State and national code organization conferences and seminars;

State and national code development committees and hearings;

Review, advisory, commission, and board service are accepted.

Association-sponsored educational events and training are accepted.

Leadership and active membership in professional associations are accepted.

Professional society and trade organization events and training are accepted.

National standards developing organization training programs;

Construction product, manufacturer, distributor, or service provider training programs;

Industry site or field installation training programs;

Accredited academic programs and courses, e.g., college, university, trade, technical, vocational schools;

Web-based, on-line, self-study computer training programs;

Platform instruction;

Publication of articles.

Non-acceptable Programs, Courses, and Activities: The following programs, courses, and activities shall not count toward continuing education requirements.

Programs, courses, and activities not related to code, enforcement, or code issues are unacceptable.

DHCD JPVBCA courses for certification, including core, advanced, and technical modules;

Prince William County (PWC) Code Academy courses required for certification;

Fairfax County (FFX) Code Academy courses required for certification;

DHCD JPVBCA code update training courses for certification maintenance;

Community service and volunteer or compensated fieldwork.

Credit Hours: Accepted programs, courses, and activities earn one credit hour per contact hour, up to eight hours per course or activity per two-year period. Retroactive or advance credits are not permitted.

Updated 10/1/12

• Page 1 ---

Utility Leverage Program

Unserved Certification Guidelines

Bryan W. Horn

Director

Tamarah Holmes, Ph.D.

Director, Office of Broadband

• Page 2 ---

Department of Housing and Community Development

Utility Leverage Program- Unserved Certification Guidelines

Guidelines as of February 1, 2023

Submission Process

Pursuant to"§ 56-585.1:9" of the Code of Virginia, petitioners may submit proposed project areas to the Department of Housing and Community Development (DHCD) to be designated as unserved by broadband. Petitions must include the following:

1. Point and polygon shapefile(s) of the proposed project area as defined in this document. Petitioners must describe the proposed geographic area including specific boundaries of the project area (e.g. street names, local and regional boundaries, etc.) and attach a copy of the map of your project area(s). Wireless petitioners are required to include shapefiles of heat maps indicating received signal strength indicator (RSSI) measures in the proposed project area. In addition, all shapefiles must exclude state and authorized federal awards in the proposed project areas.

1. Petitioners must provide a list of existing providers in and near the proposed project area and describe their efforts to identify existing providers, ensure overlap was avoided, and how this information was compiled with source(s). Areas with service by satellite providers are not considered served.
2. If the petition is submitted by an entity other than a Phase I or Phase II Utility, the petitioner must provide a copy of the executed Memorandum of

Agreement (MOA) or Memorandum of Understanding (MOU) with an investor owned utility indicating intent that the Phase I or Phase II Utility intends to partner with the petitioner to provide or make available broadband capacity to internet service providers in the petition area.

1. Petitioners are encouraged to submit any additional supporting documentation demonstrating the unserved nature of the project area(s).

After submission, the petition materials will be reviewed for completeness and posted online to the DHCD website. Entities that have signed up to be notified when certifications are posted will be notified via email that a new petition is available for review. Petitioners are strongly encouraged to contact incumbent providers, if any, adjacent to the project area to

ensure the proposed project area does not overlap with existing service. Petitioners are also encouraged to contact DHCD prior to submitting a petition area to ensure state funded areas are removed from the petition area prior to submittal. Depending on project volume and any other unforeseen circumstances, DHCD shall make a determination if the project area is unserved within (75) seventy-five days, from the date of posting the proposed project. A written determination of a petition and point shapefiles depicting the final unserved area shall be provided by the Director of the Office of Broadband.

• Page 3 ---

Challenge Process

Pursuant to"§ 56-585.1:9" of the Code of Virginia, "unserved by broadband" means a designated area in which less than 10 percent of residential and commercial units are capable of receiving broadband service, provided that DHCD for its Virginia Telecommunication Initiative may, by guideline, increase such percentage from time to time. Prospective

challengers are strongly encouraged to contact applicants directly and discuss the contested project area before submitting a challenge, as project areas can often be re-scoped to remove overlap. Evidence of serviceability must be demonstrated by showing a reasonable number of customers within the area of claimed serviceable units.

Planned service to a proposed project area is eligible for the purpose of a challenge if state or federal funds have been awarded and the provider has committed to providing service to the areas using these state or federal funds. Areas adjacent to state or federally funded areas may be eligible for a challenge if the challenger demonstrates existing awards will cover the adjacent area. The challenger must commit to serving the adjacent areas at speeds equal to or greater than the petitioners deployment speed.

Challenges can be made to portions of a proposed project area without invalidating the entire project. DHCD reserves the right to invalidate a portion(s) of a proposed project area as served, aggregate challenges by different providers to determine overlap, and invalidate insufficient challenges. Challengers must demonstrate that serviceable units in the project area have access to broadband1 speeds as of the date of the challenge submission deadline or that the petition is

ineligible as a result of committed state or federal funding subject to the conditions described above.

1 Internet access at speeds equal to or greater than the speed threshold at which internet service is considered broadband, as determined by the Department of Housing and Community Development in it’s the Virginia Telecommunication Initiative program guidelines and criteria

• Page 4 ---

DHCD must receive all of the information detailed below or the challenge may be deemed incomplete and invalid. Challengers must provide:

1. A signed and notarized affidavit affirming the challenge and attached information is true.
2. Most recent Federal Communications Commission (FCC) Form 477 or equivalent.
3. Minimum/maximum speeds available in the proposed project area. (Note: Minimum/maximum speeds available in the challenged area are subject to the Freedom of Information Act and will not be provided FOIA exemption.)
4. Street level data of serviceable units within the proposed project area and provide the speeds those serviceable units are able to receive.

1. Point shapefiles that show each proposed passing in the challenged area, designated by a singular mapped point, in the challenged area containing attribute data showing the addresses of each point. Polygon shapefiles delineating the general challenged area(s).
2. For wireless providers: Heat maps indicating received signal strength indicator (RSSI) in the challenged area.

1. If challenging due to planned state or federal funding, documentation detailing commitment to provide service in or adjacent to the proposed project area.
2. The technology type deployed in the challenged area, i.e. fiber, DSL, hybrid-coaxial, fixed wireless (Note: The technology type deployed in the challenged area is subject to the Freedom of Information Act and

will not be provided FOIA exemption.)

DHCD will review all applicable challenge and rebuttal information to determine if a challenge is credible. DHCD reserves the right to request verified speed tests on all or portion(s) of the challenged area at the time of peak network usage. Further, DHCD reserves the right to request locations of actual subscribers within the area of claimed serviceable units.

Petition Review Timeline

DHCD, on the agency website2 , shall publish two dates in calendar year 2023 at which petitions for unserved certification will be due and considered by DHCD for unserved certification.

Petitions submitted prior to this deadline will be considered at the next closest petition filing deadline. Petitions submitted between the date3 that Virginia Telecommunication Initiative (VATI) Notice of Applications are due and the deadline for challenge rebuttals will be considered beginning at the nearest stated review date after the deadline for challenge rebuttals.

DHCD reserves the right to adjust this guideline based on the unique requirements of the Broadband Equity, Access, and Deployment Program.

DHCD will post electronic copies of the proposed findings to the agency website within seven (7) days after petition materials are received. DHCD will notify individuals signed up for certification notifications via email that the petition is available for review. Providers wishing

1 https://dhcd.virginia.gov/utilityleverage 3 The VATI Timeline can be found on the agency website at https://www.dhcd.virginia.gov/vati

• Page 5 ---

to submit a challenge must provide the information required in these guidelines no later than (30) thirty days from the date the petition is posted on the agency website. Petitioners will be notified if their proposed project area is being challenged and will have fourteen (14) days from notification of a challenge to provide rebuttal information to DHCD including speed tests and

a signed and notarized affidavit affirming the rebuttal and attached information is true. Should DHCD require additional information from the challenger following the submission of rebuttal materials, challengers will have ten (10) days to submit requested materials from the time of request. If speed tests are requested, please see Appendix A for additional guidance on the number of speed tests required and acceptable practices for conducting speed tests. Broadband providers that utilize variable speed technologies are strongly encouraged to include speed tests

according to this guidance at the time of challenge. DHCD may extend any portion of the review period if petition volume or other circumstances necessitate extension.

DHCD shall notify the petitioner and challenger in writing if a challenge is valid no later than (45) forty-five days after the challenge window has closed. If petition volume or circumstances necessitate an extension, final notification will be issued no later than (60) sixty days after challenge window has closed. If no challenge is received and DHCD has determined no state

or authorized federal funding is present in the project area, the proposed project area will be deemed as unserved.

For all questions regarding the submission and challenge process, please email:broadband@dhcd.virginia.gov.

Freedom of Information Act (FOIA) Policy

Pursuant to"§ 2.2-3705.6-3" of the Code of Virginia, information pertaining to utility leverage program challenges may be eligible for FOIA exemption. Challengers wishing to receive FOIA exemption must request exemption directly to broadband@dhcd.virginia.gov, detailing the nature of the requested material. Do not include the confidential materials in the FOIA exemption request. Challengers wishing to request exemption for multiple challenges must do so individually, in separate requests. DHCD will notify challengers if their FOIA exemption request is approved and then challengers can transmit confidential information to DHCD.

Petitioners who have received a challenge will be notified and may also request FOIA

exemption for information pertaining to their rebuttal.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department: a. Invoking such exclusion upon submission of the data or other materials for which protection from disclosure is sought; b. Identifying with specificity the data, information, or other materials for which protection is sought; and c. Stating the reasons why protection is necessary.

• Page 6 ---

The Department shall determine whether the requested exclusion from disclosure is necessary to protect the trade secrets or confidential proprietary information of the applicant. The

Department shall make a written determination of the nature and scope of the protection to be afforded by it under this subdivision.

Definitions

Adjacent- adjoining parcels sharing a roadway, private or public, other than highways or expressways as a common boundary

Authorized - federal awards that have received final approval for funding Passing - any structure that can receive service. Multi-unit structures may be counted as

more than 1 passing, provided individual connections and accounts are planned at that structure.

Peak Usage - Weekdays from 7:00 p.m. - 11:00 p.m. local time.

Point Shapefiles - shapefiles that show each proposed passing in the application area as a singular mapped point, in the application or challenged area containing attribute data showing the addresses of each point.

Polygon Shapefiles - shapefiles delineating the general project area(s).

RSSI - Received Signal Strength Indicator, or RSSI, is an estimated measure of power level that a wireless client device is receiving from an access point or router. See Appendix B for more information.

Service Area - Refers to the geographic territory in which a petitioner has proposed to provide service.

Serviceable Units - Properties that are eligible for broadband service without additional special construction costs from the property owner/subscriber.

Street Level Data - Address ranges or specific addresses from an existing provider along with the existing number of customers within those ranges. No personal information on specific customers will be requested.

Unserved - Properties that do not have internet access at speeds equal to or greater than the speed threshold at which internet service is considered broadband, as determined by the Department of Housing and Community Development in it’s the Virginia Telecommunication Initiative program guidelines and criteria

• Page 7 ---

Appendix A - Requirements of Speed Tests

As outlined in these guidelines, DHCD reserves the right to request verified speed tests on all or portion(s) of a challenger’s existing network. Upon the request of DHCD, verified speed tests must be conducted at times of peak network usage and be distributed throughout a challenged area..

DHCD prefers speed tests be conducted at the access point (i.e. customer premise equipment, router, or modem) at the end-user location. Recognizing the feasibility constraints of conducting speed tests at end-user locations, speed tests that are reported by the management application software at the network operations center will also be considered as valid.

The percent of required speed tests on a challenger’s existing network will depend on the size of the challenged area.

Requirements of Challengers: If challengers are required to submit verified speed tests as a part of their challenge, or are requested by DHCD to submit speed test information, the number of required speed tests will be based upon the total number of challenged units. Please see the table below for the required number of speed

tests.

Number of Less than 500 500 or Greater, but 1000 or Greater Challenged less than 1000 Locations within an Application Area Required Percentage 10% 7.5% 5% of Speed Tests, based on Total Number of Challenged Units

In the event the challenger does not have enough customers to achieve the required percentage of speed tests, DHCD will consider field tests data to satisfy the requirement. When submitting this information to DHCD, speed tests and field tests must be listed in a spreadsheet along with the address of the unit or location at which the speed test or field test was conducted. If these materials submitted are incomplete, DHCD will consider the application invalid.

[TABLE 7-1] Number of Challenged Locations within an Application Area | Less than 500 | 500 or Greater, but less than 1000 | 1000 or Greater Required Percentage of Speed Tests, based on Total Number of Challenged Units | 10% | 7.5% | 5%

[/TABLE]

• Page 1 ---

Utility Leverage Program

Unserved Certification Guidelines

Bryan W. Horn

Director

Tamarah Holmes, Ph.D.

Director, Office of Broadband

• Page 2 ---

Department of Housing and Community Development

Utility Leverage Program- Unserved Certification Guidelines

Guidelines as of February 1, 2023

Submission Process

Pursuant to"§ 56-585.1:9" of Virginia law, petitioners may submit proposed project areas to DHCD for unserved designation. Petitions must include:

1. Petitioners must submit shapefiles of the project area, including boundaries, maps, and heat maps of RSSI; exclude state and federal awards.

1. Petitioners must list nearby providers, describe efforts to identify and avoid overlap, and include sources. Satellite service areas are not considered served.
2. If submitted by non-Phase I/II utility, provide a copy of the executed Memorandum of

An MOA or MOU with an investor-owned utility indicating the utility's intent to partner with the petitioner to provide or make broadband capacity available to ISPs in the petition area.

1. Petitioners are encouraged to submit additional documentation showing the unserved status of the project area(s).

After submission, DHCD will review petitions for completeness, post online, notify registered entities via email, and strongly encourage petitioners to contact adjacent incumbent providers to

Petitioners should ensure no overlap with existing service, contact DHCD beforehand to exclude state-funded areas, and DHCD will determine unserved status within 75 days, providing a written decision and shapefiles.

• Page 3 ---

Challenge Process

Per"§ 56-585.1:9" of Virginia law, "unserved by broadband" means less than 10% of units can receive broadband, with DHCD able to increase this threshold by guideline. Prospective

Challengers are encouraged to contact applicants before challenging, as areas can be re-scoped. Evidence must show a reasonable number of customers in the claimed service area.

Service planned with awarded state or federal funds is challenge-eligible. Adjacent areas with existing awards may also qualify if challengers commit to equal or higher speeds than petitioners.

Challenges may target parts of a project without invalidating the whole. DHCD can invalidate portions, aggregate challenges, or dismiss insufficient ones. Challengers must show units have broadband speeds at challenge deadline or that the petition is

ineligible due to committed state or federal funding per above conditions.

1 Internet access at speeds meeting or exceeding broadband thresholds as defined by DHCD in the Virginia Telecommunication Initiative guidelines.

• Page 4 ---

DHCD must receive all required information below; incomplete challenges may be invalid. Challengers must provide:

1. A signed and notarized affidavit affirming the challenge and attached information is true.
2. Most recent FCC Form 477 or equivalent.
3. Available minimum/maximum speeds in the project area. (Note: Speeds are subject to FOIA and will not be exempted.)
4. Street-level data of serviceable units and their speeds within the project area.

1. Point shapefiles of each proposed passing with address attributes; polygon shapefiles delineating challenged areas.
2. Wireless providers: heat maps of RSSI in the challenged area.

1. If challenging due to planned funding, provide documentation of service commitments in or near the project area.
2. Technology deployed in the challenged area (fiber, DSL, hybrid-coaxial, fixed wireless). (Note: Technology info is subject to FOIA).

will not be FOIA-exempt.

DHCD will review challenge and rebuttal info for credibility, may request verified speed tests during peak usage, and actual subscriber locations within the challenged area.

Petition Review Timeline

DHCD will publish two 2023 dates on its website when petitions for unserved certification are due and will be considered.

Petitions before the deadline will be considered at the next filing date. Those submitted between VATI application due date and challenge rebuttal deadline will be reviewed after the rebuttal deadline.

DHCD may adjust this guideline based on the Broadband Equity, Access, and Deployment Program's needs.

DHCD will post proposed findings within 7 days of receipt and notify registered individuals via email. Providers wishing

1 https://dhcd.virginia.gov/utilityleverage; VATI timeline at https://www.dhcd.virginia.gov/vati

• Page 5 ---

To submit a challenge, provide required information within 30 days of petition posting. Petitioners will be notified of challenges and have 14 days to submit rebuttal info including speed tests.

A signed, notarized affidavit affirming rebuttal accuracy is required. DHCD has 10 days to request additional info. Appendix A guides speed test requirements; providers using variable speed tech are encouraged to include tests.

DHCD may extend review periods as needed based on petition volume or circumstances.

DHCD will notify petitioner and challenger in writing within 45 days if challenge is valid; with extension, final notice is within 60 days. If no challenge and no state

If no federal funding is present, the project area is deemed unserved.

For questions on submission and challenge process, email broadband@dhcd.virginia.gov.

FOIA Policy

Pursuant to"§ 2.2-3705.6-3" of the Code of Virginia, information pertaining to utility leverage program challenges may be eligible for FOIA exemption. Challengers wishing to receive FOIA exemption must request exemption directly to broadband@dhcd.virginia.gov, detailing the nature of the requested material. Do not include the confidential materials in the FOIA exemption request. Challengers wishing to request exemption for multiple challenges must do so individually, in separate requests. DHCD will notify challengers if their FOIA exemption request is approved and then challengers can transmit confidential information to DHCD.

Challenged petitioners will be notified and may request FOIA

exemption for rebuttal information.

Applicants must submit a written request to the Department to exclude data, specifying the materials and reasons for protection, upon submission.

• Page 6 ---

The Department will decide if exclusion is necessary to protect trade secrets or confidential info.

The Department will issue a written determination of the protection scope.

Definitions

Adjacent: parcels sharing a private or public roadway, excluding highways or expressways.

Authorized: federally approved funding. Passing: any structure receiving service; multi-unit structures may count as

more than 1 passing if individual connections and accounts are planned.

Peak Usage: weekdays 7:00 p.m. - 11:00 p.m. local time.

Point Shapefiles: show each proposed passing as a point with address attribute data.

Polygon Shapefiles: delineate general project areas.

RSSI: measure of wireless signal power received by a device. See Appendix B.

Service Area: geographic territory where service is proposed.

Serviceable Units: properties eligible for broadband without extra construction costs.

Street Level Data: address ranges or specific addresses with customer counts; no personal info requested.

Unserved: properties lacking broadband speeds per Virginia Telecommunication Initiative criteria.

• Page 7 ---

Appendix A: Speed Test Requirements

As outlined in these guidelines, DHCD reserves the right to request verified speed tests on all or portion(s) of a challenger’s existing network. Upon the request of DHCD, verified speed tests must be conducted at times of peak network usage and be distributed throughout a challenged area..

DHCD prefers speed tests at the end-user access point; tests from network management software are also valid if end-user testing isn't feasible.

Required speed test percentage depends on challenged area size.

Challengers must submit speed tests based on challenged units; see table for required number.

tests.

Number of Less than 500 500 or Greater, but 1000 or Greater Challenged less than 1000 Locations within an Application Area Required Percentage 10% 7.5% 5% of Speed Tests, based on Total Number of Challenged Units

If challengers lack enough customers for required speed tests, DHCD may consider field test data. Submissions must include a spreadsheet with test locations and addresses; incomplete submissions render the application invalid.

[TABLE 7-1] Challenged locations: <500, 500-999, ≥1000; required speed test percentages: 10%, 7.5%, 5%

[/TABLE]

• Page 1 ---

Utility Leverage Program

Unserved Certification Guidelines

Bryan W. Horn

Director

Tamarah Holmes, Ph.D.

Director, Office of Broadband

• Page 2 ---

Department of Housing and Community Development

Utility Leverage Program- Unserved Certification Guidelines

Guidelines as of February 1, 2023

Submission Process

Pursuant to"§ 56-585.1:9" of the Code of Virginia, petitioners may submit proposed project areas to the Department of Housing and Community Development (DHCD) to be designated as unserved by broadband. Petitions must include the following:

1. Point and polygon shapefile(s) of the proposed project area as defined in this document. Petitioners must describe the proposed geographic area including specific boundaries of the project area (e.g. street names, local and regional boundaries, etc.) and attach a copy of the map of your project area(s). Wireless petitioners are required to include shapefiles of heat maps indicating received signal strength indicator (RSSI) measures in the proposed project area. In addition, all shapefiles must exclude state and authorized federal awards in the proposed project areas.

1. Petitioners must provide a list of existing providers in and near the proposed project area and describe their efforts to identify existing providers, ensure overlap was avoided, and how this information was compiled with source(s). Areas with service by satellite providers are not considered served.
2. If the petition is submitted by an entity other than a Phase I or Phase II Utility, the petitioner must provide a copy of the executed Memorandum of

Agreement (MOA) or Memorandum of Understanding (MOU) with an investor owned utility indicating intent that the Phase I or Phase II Utility intends to partner with the petitioner to provide or make available broadband capacity to internet service providers in the petition area.

1. Petitioners are encouraged to submit any additional supporting documentation demonstrating the unserved nature of the project area(s).

After submission, the petition materials will be reviewed for completeness and posted online to the DHCD website. Entities that have signed up to be notified when certifications are posted will be notified via email that a new petition is available for review. Petitioners are strongly encouraged to contact incumbent providers, if any, adjacent to the project area to

ensure the proposed project area does not overlap with existing service. Petitioners are also encouraged to contact DHCD prior to submitting a petition area to ensure state funded areas are removed from the petition area prior to submittal. Depending on project volume and any other unforeseen circumstances, DHCD shall make a determination if the project area is unserved within (75) seventy-five days, from the date of posting the proposed project. A written determination of a petition and point shapefiles depicting the final unserved area shall be provided by the Director of the Office of Broadband.

• Page 3 ---

Challenge Process

Pursuant to"§ 56-585.1:9" of the Code of Virginia, "unserved by broadband" means a designated area in which less than 10 percent of residential and commercial units are capable of receiving broadband service, provided that DHCD for its Virginia Telecommunication Initiative may, by guideline, increase such percentage from time to time. Prospective

challengers are strongly encouraged to contact applicants directly and discuss the contested project area before submitting a challenge, as project areas can often be re-scoped to remove overlap. Evidence of serviceability must be demonstrated by showing a reasonable number of customers within the area of claimed serviceable units.

Planned service to a proposed project area is eligible for the purpose of a challenge if state or federal funds have been awarded and the provider has committed to providing service to the areas using these state or federal funds. Areas adjacent to state or federally funded areas may be eligible for a challenge if the challenger demonstrates existing awards will cover the adjacent area. The challenger must commit to serving the adjacent areas at speeds equal to or greater than the petitioners deployment speed.

Challenges can be made to portions of a proposed project area without invalidating the entire project. DHCD reserves the right to invalidate a portion(s) of a proposed project area as served, aggregate challenges by different providers to determine overlap, and invalidate insufficient challenges. Challengers must demonstrate that serviceable units in the project area have access to broadband1 speeds as of the date of the challenge submission deadline or that the petition is

ineligible as a result of committed state or federal funding subject to the conditions described above.

1 Internet access at speeds equal to or greater than the speed threshold at which internet service is considered broadband, as determined by the Department of Housing and Community Development in it’s the Virginia Telecommunication Initiative program guidelines and criteria

• Page 4 ---

DHCD must receive all of the information detailed below or the challenge may be deemed incomplete and invalid. Challengers must provide:

1. A signed and notarized affidavit affirming the challenge and attached information is true.
2. Most recent Federal Communications Commission (FCC) Form 477 or equivalent.
3. Minimum/maximum speeds available in the proposed project area. (Note: Minimum/maximum speeds available in the challenged area are subject to the Freedom of Information Act and will not be provided FOIA exemption.)
4. Street level data of serviceable units within the proposed project area and provide the speeds those serviceable units are able to receive.

1. Point shapefiles that show each proposed passing in the challenged area, designated by a singular mapped point, in the challenged area containing attribute data showing the addresses of each point. Polygon shapefiles delineating the general challenged area(s).
2. For wireless providers: Heat maps indicating received signal strength indicator (RSSI) in the challenged area.

1. If challenging due to planned state or federal funding, documentation detailing commitment to provide service in or adjacent to the proposed project area.
2. The technology type deployed in the challenged area, i.e. fiber, DSL, hybrid-coaxial, fixed wireless (Note: The technology type deployed in the challenged area is subject to the Freedom of Information Act and

will not be provided FOIA exemption.)

DHCD will review all applicable challenge and rebuttal information to determine if a challenge is credible. DHCD reserves the right to request verified speed tests on all or portion(s) of the challenged area at the time of peak network usage. Further, DHCD reserves the right to request locations of actual subscribers within the area of claimed serviceable units.

Petition Review Timeline

DHCD, on the agency website2 , shall publish two dates in calendar year 2023 at which petitions for unserved certification will be due and considered by DHCD for unserved certification.

Petitions submitted prior to this deadline will be considered at the next closest petition filing deadline. Petitions submitted between the date3 that Virginia Telecommunication Initiative (VATI) Notice of Applications are due and the deadline for challenge rebuttals will be considered beginning at the nearest stated review date after the deadline for challenge rebuttals.

DHCD reserves the right to adjust this guideline based on the unique requirements of the Broadband Equity, Access, and Deployment Program.

DHCD will post electronic copies of the proposed findings to the agency website within seven (7) days after petition materials are received. DHCD will notify individuals signed up for certification notifications via email that the petition is available for review. Providers wishing

1 https://dhcd.virginia.gov/utilityleverage 3 The VATI Timeline can be found on the agency website at https://www.dhcd.virginia.gov/vati

• Page 5 ---

to submit a challenge must provide the information required in these guidelines no later than (30) thirty days from the date the petition is posted on the agency website. Petitioners will be notified if their proposed project area is being challenged and will have fourteen (14) days from notification of a challenge to provide rebuttal information to DHCD including speed tests and

a signed and notarized affidavit affirming the rebuttal and attached information is true. Should DHCD require additional information from the challenger following the submission of rebuttal materials, challengers will have ten (10) days to submit requested materials from the time of request. If speed tests are requested, please see Appendix A for additional guidance on the number of speed tests required and acceptable practices for conducting speed tests. Broadband providers that utilize variable speed technologies are strongly encouraged to include speed tests

according to this guidance at the time of challenge. DHCD may extend any portion of the review period if petition volume or other circumstances necessitate extension.

DHCD shall notify the petitioner and challenger in writing if a challenge is valid no later than (45) forty-five days after the challenge window has closed. If petition volume or circumstances necessitate an extension, final notification will be issued no later than (60) sixty days after challenge window has closed. If no challenge is received and DHCD has determined no state

or authorized federal funding is present in the project area, the proposed project area will be deemed as unserved.

For all questions regarding the submission and challenge process, please email:broadband@dhcd.virginia.gov.

Freedom of Information Act (FOIA) Policy

Pursuant to"§ 2.2-3705.6-3" of the Code of Virginia, information pertaining to utility leverage program challenges may be eligible for FOIA exemption. Challengers wishing to receive FOIA exemption must request exemption directly to broadband@dhcd.virginia.gov, detailing the nature of the requested material. Do not include the confidential materials in the FOIA exemption request. Challengers wishing to request exemption for multiple challenges must do so individually, in separate requests. DHCD will notify challengers if their FOIA exemption request is approved and then challengers can transmit confidential information to DHCD.

Petitioners who have received a challenge will be notified and may also request FOIA

exemption for information pertaining to their rebuttal.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department: a. Invoking such exclusion upon submission of the data or other materials for which protection from disclosure is sought; b. Identifying with specificity the data, information, or other materials for which protection is sought; and c. Stating the reasons why protection is necessary.

• Page 6 ---

The Department shall determine whether the requested exclusion from disclosure is necessary to protect the trade secrets or confidential proprietary information of the applicant. The

Department shall make a written determination of the nature and scope of the protection to be afforded by it under this subdivision.

Definitions

Adjacent- adjoining parcels sharing a roadway, private or public, other than highways or expressways as a common boundary

Authorized - federal awards that have received final approval for funding Passing - any structure that can receive service. Multi-unit structures may be counted as

more than 1 passing, provided individual connections and accounts are planned at that structure.

Peak Usage - Weekdays from 7:00 p.m. - 11:00 p.m. local time.

Point Shapefiles - shapefiles that show each proposed passing in the application area as a singular mapped point, in the application or challenged area containing attribute data showing the addresses of each point.

Polygon Shapefiles - shapefiles delineating the general project area(s).

RSSI - Received Signal Strength Indicator, or RSSI, is an estimated measure of power level that a wireless client device is receiving from an access point or router. See Appendix B for more information.

Service Area - Refers to the geographic territory in which a petitioner has proposed to provide service.

Serviceable Units - Properties that are eligible for broadband service without additional special construction costs from the property owner/subscriber.

Street Level Data - Address ranges or specific addresses from an existing provider along with the existing number of customers within those ranges. No personal information on specific customers will be requested.

Unserved - Properties that do not have internet access at speeds equal to or greater than the speed threshold at which internet service is considered broadband, as determined by the Department of Housing and Community Development in it’s the Virginia Telecommunication Initiative program guidelines and criteria

• Page 7 ---

Appendix A - Requirements of Speed Tests

As outlined in these guidelines, DHCD reserves the right to request verified speed tests on all or portion(s) of a challenger’s existing network. Upon the request of DHCD, verified speed tests must be conducted at times of peak network usage and be distributed throughout a challenged area..

DHCD prefers speed tests be conducted at the access point (i.e. customer premise equipment, router, or modem) at the end-user location. Recognizing the feasibility constraints of conducting speed tests at end-user locations, speed tests that are reported by the management application software at the network operations center will also be considered as valid.

The percent of required speed tests on a challenger’s existing network will depend on the size of the challenged area.

Requirements of Challengers: If challengers are required to submit verified speed tests as a part of their challenge, or are requested by DHCD to submit speed test information, the number of required speed tests will be based upon the total number of challenged units. Please see the table below for the required number of speed

tests.

Number of Less than 500 500 or Greater, but 1000 or Greater Challenged less than 1000 Locations within an Application Area Required Percentage 10% 7.5% 5% of Speed Tests, based on Total Number of Challenged Units

In the event the challenger does not have enough customers to achieve the required percentage of speed tests, DHCD will consider field tests data to satisfy the requirement. When submitting this information to DHCD, speed tests and field tests must be listed in a spreadsheet along with the address of the unit or location at which the speed test or field test was conducted. If these materials submitted are incomplete, DHCD will consider the application invalid.

[TABLE 7-1] Number of Challenged Locations within an Application Area | Less than 500 | 500 or Greater, but less than 1000 | 1000 or Greater Required Percentage of Speed Tests, based on Total Number of Challenged Units | 10% | 7.5% | 5%

[/TABLE]

• Page 1 ---

Utility Leverage Program

Unserved Certification Guidelines

Bryan W. Horn

Director

Tamarah Holmes, Ph.D.

Director, Office of Broadband

• Page 2 ---

Department of Housing and Community Development

Utility Leverage Program- Unserved Certification Guidelines

Guidelines as of February 1, 2023

Submission Process

Pursuant to"§ 56-585.1:9" of Virginia law, petitioners may submit proposed project areas to DHCD for unserved designation. Petitions must include:

1. Petitioners must submit shapefiles of the project area, including boundaries, maps, and heat maps of RSSI for wireless projects. Exclude state and federal awards.

1. Petitioners must list nearby providers, describe efforts to identify and avoid overlap, and include sources. Satellite service areas are not considered served.
2. If submitted by non-Phase I/II utility, provide a copy of the executed Memorandum of

An MOA or MOU with an investor-owned utility indicating the utility's intent to partner with the petitioner to provide or make broadband capacity available to ISPs in the petition area.

1. Petitioners are encouraged to submit additional documentation demonstrating the unserved status of the project area(s).

After submission, petition materials will be reviewed for completeness, posted online, and notification sent via email. Petitioners are encouraged to contact incumbent providers near the project area to

Petitioners should ensure the project area does not overlap existing service and contact DHCD beforehand to remove state-funded areas. DHCD will determine unserved status within 75 days, providing a written decision and shapefiles.

• Page 3 ---

Challenge Process

Under"§ 56-585.1:9" of Virginia law, "unserved by broadband" means less than 10% of units can receive broadband, with DHCD possibly increasing this threshold by guideline. Prospective

Challengers are encouraged to contact applicants directly before submitting a challenge, as project areas can often be re-scoped. Evidence must show a reasonable number of customers within the claimed service area.

Service planned in a project area is challenge-eligible if funds are awarded and the provider commits to service. Adjacent areas may also be challenged if existing awards cover them, with challengers committing to equal or greater speeds.

Challenges may target parts of a project area without invalidating the whole. DHCD can invalidate served portions, aggregate provider challenges, and invalidate weak ones. Challengers must show units have broadband speeds at the challenge deadline or that the petition is

ineligible due to committed state or federal funding under the above conditions.

1 Internet access at speeds meeting or exceeding the broadband threshold set by DHCD in the Virginia Telecommunication Initiative guidelines.

• Page 4 ---

DHCD must receive all required information below; incomplete challenges may be invalid. Challengers must provide:

1. A signed and notarized affidavit affirming the challenge and attached information is true.
2. Most recent FCC Form 477 or equivalent.
3. Available min/max speeds in the project area. (Note: speeds are subject to FOIA and will not be exempted.)
4. Street-level data of serviceable units and their speeds within the project area.

1. Point shapefiles of each proposed passing with address attributes; polygon shapefiles delineate challenged areas.
2. Wireless providers: heat maps of RSSI in the challenged area.

1. If challenging due to planned funding, provide documentation of service commitments in or near the project area.
2. Technology deployed in the challenged area: fiber, DSL, hybrid-coaxial, fixed wireless. (Note: subject to FOIA).

will not be provided FOIA exemption.)

DHCD will review challenge and rebuttal info to assess credibility. It may request verified speed tests during peak usage and subscriber locations within the challenged area.

Petition Review Timeline

DHCD will publish two 2023 dates on its website when petitions for unserved certification are due and will be considered.

Petitions before the deadline will be considered at the next filing date. Those submitted between VATI application due date and challenge rebuttal deadline will be reviewed after the rebuttal deadline.

DHCD may adjust this guideline based on the Broadband Equity, Access, and Deployment Program's needs.

DHCD will post proposed findings within 7 days of receipt and notify signed individuals via email. Providers wishing

1 https://dhcd.virginia.gov/utilityleverage 3 VATI Timeline at https://www.dhcd.virginia.gov/vati

• Page 5 ---

To submit a challenge, provide required information per guidelines within 30 days of petition posting. Petitioners will be notified of challenges and have 14 days to submit rebuttal info, including speed tests.

Challengers must submit a signed, notarized affidavit affirming rebuttal accuracy. If DHCD requests more info, challengers have 10 days to respond. Appendix A guides speed test requirements; providers using variable speed are encouraged to include tests.

DHCD may extend review periods as needed based on petition volume or circumstances.

DHCD will notify petitioner and challenger in writing within 45 days if challenge is valid; if extended, final notice within 60 days. If no challenge and no state

If no federal funding is present, the project area is deemed unserved.

For questions about submission and challenge process, email broadband@dhcd.virginia.gov.

FOIA Policy

Pursuant to"§ 2.2-3705.6-3" of the Code of Virginia, information pertaining to utility leverage program challenges may be eligible for FOIA exemption. Challengers wishing to receive FOIA exemption must request exemption directly to broadband@dhcd.virginia.gov, detailing the nature of the requested material. Do not include the confidential materials in the FOIA exemption request. Challengers wishing to request exemption for multiple challenges must do so individually, in separate requests. DHCD will notify challengers if their FOIA exemption request is approved and then challengers can transmit confidential information to DHCD.

Challenged petitioners will be notified and may request FOIA

exemption for their rebuttal information.

To exclude info from disclosure, the applicant must submit a written request identifying specific data and reasons for protection upon submission to the Department.

• Page 6 ---

The Department will decide if exclusion is necessary to protect trade secrets or confidential info.

The Department will issue a written determination of protection scope.

Definitions

Adjacent parcels sharing a private or public roadway, excluding highways or expressways.

Authorized: federally approved funding. Passing: any structure receiving service; multi-unit structures may count as

more than one passing if individual connections and accounts are planned.

Peak Usage: weekdays 7:00 p.m. - 11:00 p.m. local time.

Point Shapefiles: show each proposed passing as a point with attribute data of addresses in the application or challenged area.

Polygon Shapefiles: delineate general project areas.

RSSI: measure of wireless signal power received by a device from an access point or router. See Appendix B.

Service Area: geographic territory where service is proposed.

Serviceable Units: properties eligible for broadband without extra construction costs.

Street Level Data: address ranges or specific addresses with customer counts; no personal info requested.

Unserved: properties lacking broadband speeds as defined by the Virginia Telecommunication Initiative guidelines.

• Page 7 ---

Appendix A: Speed Test Requirements

As outlined in these guidelines, DHCD reserves the right to request verified speed tests on all or portion(s) of a challenger’s existing network. Upon the request of DHCD, verified speed tests must be conducted at times of peak network usage and be distributed throughout a challenged area..

DHCD prefers speed tests at the end-user access point; tests from network management software are also valid if end-user testing isn't feasible.

Required speed test percentage depends on challenged area size.

Challengers must submit verified speed tests based on challenged units; see table for required number.

tests.

Number of Less than 500 500 or Greater, but 1000 or Greater Challenged less than 1000 Locations within an Application Area Required Percentage 10% 7.5% 5% of Speed Tests, based on Total Number of Challenged Units

If challengers lack enough customers for required speed tests, DHCD may consider field test data. Submissions must include a spreadsheet with test locations and addresses; incomplete submissions render the application invalid.

[TABLE 7-1] Challenged locations: <500, 500–999, ≥1000; required speed test percentages: 10%, 7.5%, 5%.

[/TABLE]

• Page 1 ---

Virginia Telecommunication

Initiative (VATI)

2024 Program

Guidelines and Criteria

[TABLE 1-1] 2024 Program Guidelines and Criteria

[/TABLE]

• Page 2 ---

Table of Contents

Background 3 Summary of Changes to the 2024 VATI Guidelines and Criteria Program 4

Description 6 Definition of Broadband 6

Freedom of Information Act (FOIA) 6 Eligible Applicants 7 Selection Process 7 Infrastructure Investments and Jobs Act 7

Technical Assistance 8 Universal Coverage 8 Eligible Areas 8 Previously Funded Areas 9 Multiple Applications 11 Project Financing 11 VATI Notice of Application 12 Challenge Process 12 Implementation Deadline 14 Organizational and Management Capabilities 15 Application Due Date 16 Evaluation Criteria 17 Application Questions 19 List of Required Attachments, PDF Format Required 23 List of Required Attachments, Shapefiles 24 Freedom of Information (FOIA) Policy 27

Definitions 30 Appendix A-Sample VATI Application Notice 32

Appendix B - Received Signal Strength Indicator 34 Appendix C - Requirements of Speed Tests 36

2 | Page

• Page 3 ---

Background

The digital divide – the lack of universal broadband coverage – is not only a technology issue; it is essential infrastructure for modern community and economic development. Broadband availability promotes sustainability and growth of communities by providing; access to health care, particularly through the introduction of telemedicine, which improves the local workforce,

provides increased educational opportunities through distance learning, and encourages an entrepreneurial economy where new and existing home-based and small businesses are able to compete globally.

Disconnected communities continue to struggle to retain existing businesses due to slow, sporadic, or limited broadband services. Since the vast majority of businesses rely on the internet to perform business functions such as online banking, e-commerce transactions (i.e., sales and online payment processing), market development (i.e. online ads, websites, bulk-email, etc.), customer service through online chat or emails and internal/external communication, broadband connectivity is vital to the performance of businesses of all sizes. Broadband is a necessity in the twenty-first century economy.

Additional guidance and questions regarding project development or about the VATI, guidelines and criteria should be directed to:

VATI email address vati@dhcd.virginia.gov

Tamarah Holmes, Ph.D. Director, Office of Broadband

Caroline Luxhoj, VATI Program Manager

Cole McAndrew, Broadband Policy Planner

Please refer questions regarding your application to: vati@dhcd.virginia.gov

3 | Page

• Page 4 ---

Summary of Changes to the 2024 VATI Guidelines and Criteria

Broadband Equity, Access, and Deployment (BEAD) Program Funding

The Department of Housing and Community Development’s Office of Broadband has been

designated by Governor Youngkin to serve as the recipient of, and administering agent for, any BEAD Program funding for the Commonwealth of Virginia. Both BEAD funding utilized for broadband deployment and state general funds will be regarded as under the umbrella of the Virginia Telecommunication Initiative; however, the Office of Broadband will invite proposals for funding under the BEAD program separate of those proposals for state general funds. Proposals received for BEAD funding will be scored, governed, and administered via BEAD and subsequent federal guidance. Proposals received for state general funding will be scored, governed, and

administered via FY24 VATI Guidelines and Criteria.

Eligible applicants to each program are encouraged to apply for both funding sources, with

consideration of the eligibility of areas in the application. There is no prohibition on proposals receiving funds from both programs, so long as a project is otherwise eligible and there is no duplication of funding.. DHCD reserves the right to make administrative determinations and recommendations on VATI awards of state general funds based on capacity of the participating internet service provider to accommodate federal requirements of BEAD funds, the funding feasibility of the technology type under BEAD, as well as funding eligibility of areas for state general funding when compared to BEAD, among other factors. DHCD reserves the right to

partially award any application and may request applicants and internet service providers provide information for a subset of an area within their original application area during the application process for state general funding.

Applicants, including internet service providers are strongly encouraged to contact DHCD prior to submitting applications for BEAD or state general funds to discuss alignment, as well as incongruence, between each program. (Page 6)

Connect America Fund Phase II

Announced in 2018, the Federal Communications Commission’s (FCC) Connect America Fund Phase II (CAF-II) Auction obligated over $108 million in funding to extend broadband

infrastructure access to over 39,800 locations across the Commonwealth. The performance requirements of this program are staggered with a construction deadline of 6 years, beginning after internet service provider grantees finalize documentation with the FCC. While many examples across the Commonwealth exist of timely construction of these areas under this program, a limited number of CAF-II awarded areas have yet to be built out.

To account for these areas which have not yet been constructed, and thus ensuring these locations

have a solution for broadband access regardless of the outcome of federal programs, passings in 4 | Page

• Page 5 ---

CAF-II awarded areas which have not yet been built out may be included in a VATI application,

provided the CAF-II awardee and VATI co-applicant are not the same entity and the project timeline would provide broadband access ahead of the CAF-II construction deadline.

The Department of Housing and Community Development may provisionally award these CAF-II funded areas. Awards in these areas will be contingent to the CAF-II awarded internet service provider’s de-obligation of these areas without penalty by the FCC.

Project Financing

Elimination of the requirement that an applicant and co-applicant had to be unsuccessful in a previous round of VATI to count prior-expended match toward their application.

Commonwealth Priorities

Additional Response Required Under Commonwealth Priorities (Page 20) a. The co-applicant’s efforts to mitigate costs and delays that may be associated with make-ready and other permitting requirements anticipated for network deployment.

5 | Page

• Page 6 ---

Program Description

Administered by the Virginia Department of Housing and Community Development (DHCD), the Virginia Telecommunication Initiative (VATI) enhances the sustainability and growth of communities throughout the Commonwealth by preparing those communities to build, utilize, and

capitalize on telecommunications infrastructure. Consistent with the enabling budget language, DHCD will award funding to eligible applicants to provide last-mile services to unserved areas of the Commonwealth. DHCD reserves the right to award any amount to eligible grantees, depending entirely on the quality and quantity of applications received.

The primary objective of the VATI grant making process is to provide financial assistance to supplement construction costs by private sector broadband service providers, in partnership with

local units of government, to extend service to areas that presently are unserved by any broadband provider.

Definition of Broadband

Broadband is the transmission of wide bandwidth data over a high-speed internet connection.

For the purposes of VATI and other programs dependent on the VATI definition of broadband, the speeds at which internet service is considered broadband, is access to speeds at or above 100

megabits per second (Mbps) download and 20 Mbps upload.

Freedom of Information Act (FOIA)

Pursuant to Section 2.2-3705.6-32 of the Code of Virginia, DHCD has the legal authority with the following information contained in a public record and is exempt from the mandatory disclosure

provisions of the Virginia Freedom of Information Act (FOIA): “information related to a grant application, or accompanying a grant application, submitted to the Department of Housing and Community Development that would (i) reveal (a) trade secrets, (b) financial information of a grant applicant that is not a public body, including balance sheets and financial statements, that are not generally available to the public through regulatory disclosure or otherwise, or (c) research-

related information produced or collected by the applicant in the conduct of or as a result of study or research on medical, rehabilitative, scientific, technical, technological, or scholarly issues, when such information has not been publicly released, published, copyrighted, or patented, and (ii) be harmful to the competitive position of the applicant.” Applicants wishing to receive FOIA

exemption must submit a written request to DHCD and follow the FOIA policy, found on page 21. Note: Point and polygon shapefiles submitted with VATI applications are subject to the Freedom of Information Act and will not be provided FOIA exemption. RSSI measures in the project area(s) are eligible for Freedom of Information Act exemption.

6 | Page

• Page 7 ---

Eligible Applicants

Applications must be submitted by a unit of government (Towns, Cities, Counties, Economic Development Authorities/Industrial Development Authorities, Planning District Commissions, School Divisions, etc.) with a private sector internet service provider as a co-applicant. Eligible projects must be owned and operated by the private sector co-applicant. Publicly owned networks are eligible for the program when partnered with a private sector co-applicant, so long as the private sector applicant is serving as the customer-facing internet service provider.

Notwithstanding program requirements that applications include a private-sector internet service provider as the co-applicant, public broadband authorities may apply directly for VATI funds without investment from the private sector. Such awards, in sum, shall not exceed 10 percent of total available state general funds in FY2024. Applications submitted without a private sector co-applicant will be evaluated alongside other applications. DHCD reserves the right to update this guidance upon final adoption of the state budget by the General Assembly and Governor.

Selection Process

Awardees will be selected through a competitive application process. Application questions will be

focused on the applicant’s broadband needs as well as information related to ready-to-construct project(s) needing financial assistance to supplement construction costs. The applicant must demonstrate a readiness to proceed with an awarded project in a timely manner by the required deadline and must provide access to broadband speeds at or above 100 Megabits per second (Mbps) download and 20 Megabits (Mbps) upload. DHCD reserves the right to revoke an award due to a material misrepresentation.

Broadband Equity, Access, and Deployment (BEAD) Program Funding

The Department of Housing and Community Development’s Office of Broadband has been designated by Governor Youngkin to serve as the recipient of, and administering agent for, any BEAD Program funding for the Commonwealth of Virginia. Both BEAD funding utilized for

broadband deployment and state general funds will be regarded as under the umbrella of the Virginia Telecommunication Initiative; however, the Office of Broadband will invite proposals for funding under the BEAD program separate of those proposals for state general funds. Proposals received for BEAD funding will be scored, governed, and administered via BEAD and subsequent federal guidance. Proposals received for state general funding will be scored, governed, and administered via FY24 VATI Guidelines and Criteria.

Eligible applicants to each program are encouraged to apply for both funding sources, with consideration of the eligibility of areas in the application. There is no prohibition on proposals receiving funds from both programs, so long as a project is otherwise eligible and there is no

duplication of funding. DHCD reserves the right to make administrative determinations and recommendations on VATI awards of state general funds based on capacity of the participating internet service provider to accommodate federal requirements of BEAD funds, the funding feasibility of the technology type under BEAD, as well as funding eligibility of areas for state general funding when compared to BEAD, among other factors. DHCD reserves the right to partially award any application and may request applicants and internet service providers provide 7 | Page

• Page 8 ---

information for a subset of an area within their original application area during the application process for state general funding.

Applicants, including internet service providers,are strongly encouraged to contact DHCD prior to submitting applications for BEAD or state general funds to discuss alignment, as well as incongruence, between each program.

Technical Assistance

DHCD staff is available to provide technical assistance on the development of an application and during the challenge process to units of local government, internet service providers, grant writers,

consultants, and all other VATI stakeholders. Please reach out to DHCD staff and consult the broadband toolkit available at www.commonwealthconnect.virginia.gov/broadband-toolkit prior to engaging a private consultant. DHCD staff strongly recommends engagement of technical assistance throughout project development.

Universal Coverage

DHCD encourages applicants to ensure all projects either achieve or are part of a plan to achieve universal broadband for the locality or region. Localities can find resources for developing a universal broadband plan on the Commonwealth Connect website at www.commonwealthconnect.virginia.gov/broadband-toolkit. DHCD recognizes that due to the nature of wireless projects having an inherent potential of overlap it is strongly encouraged that

applicants contact DHCD staff for assistance. Applicants are discouraged from submitting projects that focus on pockets of density while not including nearby unserved, less dense areas. This tactic, also known as cherry picking, hurts the economics of serving the remaining areas in your community and will ultimately make it more difficult and costly to get all Virginians access to broadband coverage.

Eligible Areas

DHCD will award funding to applicants to provide last-mile services, including middle-mile

networks, equipment, or other investments required to deliver last-mile service to unserved areas of the Commonwealth. Unserved areas are defined as having broadband speeds below 100 Megabits per second (Mbps) download and 20 Megabits (Mbps) upload. Areas lacking 25 Megabits per second download and 3 Megabits per second upload speeds will be given significant

priority in application scoring.

● For a wireline project, a proposed project area is considered eligible if 20 percent or fewer of serviceable units have access to service with no special construction costs from any provider as of the date of the application. ● For a wireless project, a proposed area is considered eligible if 25 percent or fewer of serviceable units have access to service with no special construction costs from any provider as of the date of the application. Passings with RSSI below -90dbm are not eligible to be included in a VATI application. 8 | Page

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Applicants are strongly encouraged to include passings in the proposed project areas that have special construction costs (see definitions for more detail) for low to moderate income residents, as these locations will become increasingly more difficult to connect outside of the VATI application process. These passings include properties where the location has an extended setback from the public right of way beyond the maximum distance between a network access point and the home or business allowed by the co-applicant.

In some cases, applicants may seek to include locations that do not have access to broadband because of special construction costs associated with extending broadband infrastructure to a location. In instances where concentrated pockets of locations do not have access to broadband, due to special construction costs, VATI is better designed for extending broadband infrastructure to these locations. The Line Extension Customer Assistance Program (LECAP) is intended to cover costs to extend service to scattered locations across the locality, not address long drop issues in concentrated pockets of a locality. For more information, please contact DHCD staff to discuss the scope of projects prior to application.

DHCD discourages the sole use of broadband availability maps when determining unserved areas to be included in an application. Mapping efforts, regardless of the level of detail should not replace further evaluation of broadband availability (i.e., fiber, cable, vertical assets). For best practices regarding drawing a project area, please contact DHCD staff.

Previously Funded Areas

Applicants must do their due diligence to determine if their proposed VATI project area has in whole or in part been awarded state or federal broadband funds. These programs include, but are not limited to, the Virginia Telecommunication Initiative, Tobacco Region Revitalization Commission Awards, Connect America Funds II (CAFII), United States Department of Agriculture (USDA) Reconnect, USDA Community Connect, Alternative Connect America Cost Model (ACAM), and the Rural Digital Opportunity Fund (RDOF).

Federally and state funded areas with existing agreements to build service to, or are currently served with, access to internet at speeds less than 100/20 Mbps are eligible for funding under the VATI program. Federally funded areas with service obligations at or over 100/20 Mbps will not be considered for funds managed and awarded through the VATI grant making process.

In some cases, recipients of federal or state funds were awarded funding to provide service at less than 100/20 Mbps but provide service over this threshold. In instances where the network infrastructure in the previously funded area under this scenario has been constructed, an internet service provider must submit a challenge on the basis of actual serviceability in the previously funded area. In instances where network infrastructure has not been constructed in the previously funded area, a challenger may provide speed test data from existing service territories in Virginia to be considered as that provider’s capability to provide service over the 100/20 Mbps threshold.

Please see Appendix C for additional guidance on the number of speed tests required and acceptable practices for conducting speed tests. In instances where possible, DHCD encourages local governments to explore partnerships with internet service providers which received the previous state or federal award to upgrade coverage in these areas; however, no scoring preference will be assigned to local governments partnering with the state or federally awarded internet service provider during application evaluation.

In the event the VATI co-applicant has been awarded federal broadband funds, they cannot use those funds as matching funds. However, they are encouraged to leverage their federal award and apply for VATI funding to extend service to areas beyond those that were awarded federal funds 9 | Page

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or to accelerate construction of federal awards made through RDOF.

Connect America Fund Phase II

Announced in 2018, the Federal Communications Commission’s (FCC) Connect America Fund Phase II (CAF-II) Auction obligated over $108 million in funding to extend broadband infrastructure access to over 39,800 locations across the Commonwealth. The performance requirements of this program are staggered with a construction deadline of 6 years, beginning after

internet service provider grantees finalize documentation with the FCC. While many examples across the Commonwealth exist of timely construction of these areas under this program, a limited number of CAF-II awarded areas have yet to be built out.

To account for these areas which have not yet been constructed, and thus ensuring these locations have a solution for broadband access regardless of the outcome of federal programs, passings in CAF-II awarded areas which have not yet been built out may be included in a VATI application,

provided the CAF-II awardee and VATI co-applicant are not the same entity and the project timeline would provide broadband access ahead of the CAF-II construction deadline.

The Department of Housing and Community Development may provisionally award these CAF-II funded areas. Awards in these areas will be contingent to the CAF-II awarded internet service provider’s de-obligation of these areas without penalty by the FCC.

Rural Digital Opportunity Fund

On December 7, 2021, the Federal Communications Commission (FCC) announced preliminary results of the Phase 1 RDOF auction. To a far greater extent than previous FCC auctions, RDOF delivered lower than anticipated level of funding to internet service providers, presenting challenges in their ability to deliver services. To accelerate broadband access in RDOF awarded areas, passings

in those areas may be included in VATI application to cover a portion of the infrastructure needed to reach RDOF awarded areas. All RDOF passings included in a VATI application that is awarded funding must be provided access to broadband service within the VATI contractual period. RDOF passings may not exceed VATI passings in the application. DHCD reserves the right to waive this requirement on a case-by-case basis in instances where this may be impractical in an application.

For example, in some localities RDOF locations may outnumber remaining unserved passings that

are eligible for VATI. The internet service provider co-applicant must provide a detailed explanation if RDOF passings exceed VATI passings in the application.

Combining RDOF with VATI

Due to the delay in the FCC issuing the Phase I RDOF final long-form results, areas preliminarily awarded RDOF, regardless of bidder, are eligible to be included in a VATI application. RDOF

awardees who are not the VATI co-applicant may challenge an application that includes all, or portions of their final RDOF awarded area. If the challenge is determined to be credible, the applicant will be required to remove the area(s) that overlap from their application. The challenging RDOF awardee must commit to providing broadband access in the challenge area(s) within 3 years 10 | Page

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of the announcement of FY 2024 VATI awards and will be required to enter into a Memorandum of Understanding (MOU) with DHCD and the VATI applicant, or locality in which the RDOF award is contained (for regional applications), committing to construct the removed area(s) by the time the contract is executed for the awarded project. Please note; if DHCD determines that a

challenge is credible on the basis of a final RDOF award and the RDOF awardee has committed to constructing the challenges area and later defaults, they are prohibited from submitting future VATI applications for that challenged area, unless a unit of local government applicant formally expresses intent in partnering with the defaultee on a future VATI application(s) in that area.

RDOF areas, unless those areas are challenged and an MOU has been entered into by the locality and RDOF awardee, are considered unserved and fully eligible for VATI funding. If RDOF areas

awarded to an internet service provider other than the VATI applicant are included in a VATI application, but not challenged by the RDOF awardee, those will be considered as unserved and scored as such.

Leveraging RDOF in achieving Universal Coverage

If RDOF areas are included in a VATI application and that application achieves universal coverage

in the county, or counties, each RDOF passing included in that VATI application will be awarded ½ of the scoring value of a VATI passing. If multiple applications are submitted with

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different co-applicants and those applications cumulatively reach universal coverage, RDOF locations included in those applications will be awarded at ½ the scoring value of a VATI passing.

If RDOF is included in a VATI application and does not achieve universal coverage in a county, or counties but is part of a universal plan, each passing in the application will be awarded ¼ of the scoring value of one VATI passing. RDOF may not be included in a VATI application if it does not achieve universal coverage or is not part of a universal plan. RDOF passing valuations also apply to businesses and community anchor institutions in RDOF awarded areas in the VATI application.

To account for the potential of supplemental action by the Federal Communications Commission in regard to the results of Phase I RDOF auction, DHCD reserves the right to update the guidelines accordingly in response to federal rules changes.

Multiple Applications

Units of local government may submit multiple applications with different service providers and may include project areas that cross-jurisdictional boundaries. No more than one last-mile internet

service provider may be included in an application. Units of local government must submit an application with each last mile internet service provider. Service providers may submit an application with more than one unit of local government. Multiple applications that reach universal coverage in a county or region when combined will be awarded maximum points for universality when scored. An applicant may include non-contiguous service areas in a single application. If designating more than one county or city in a single application, each county or city must be clearly delineated, and the required data and budget information must be provided for each county and

city.

Project Financing

VATI funding shall not exceed 80 percent of the total project cost. Applicants should note that the program is competitive however, and that those projects that bring greater match to the application are more likely to receive higher evaluations scores.

Consistent with VATI’s enabling budget language; the private co-applicant must contribute a minimum of 10% cash match to the total project cost. If the private co-applicant match is below 10% of total project cost, applicants must provide financial details in their applications

demonstrating appropriate private investment in relation to the density and scope of the project.

Local Government expenditures incurred one year prior to the application open date, are eligible to be included in the application as match funds. Incurred expenses must be related to the proposed VATI project and meet VATI criteria. Expenditures incurred by internet service providers after May 11, 2023 are also eligible to be included in the application as match funds. Incurred expenses must also be directly related to the proposed VATI project and meet VATI criteria. DHCD staff

reserves the right to make administrative determinations on the validity of matching funds and accept a proportion of the funds when necessary. Expenses

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incurred by local governments sought to be considered as matching funds must be included and described in the Prior Expended Match Form as an application attachment.

Demonstrated local government support through contribution of Coronavirus Local Fiscal Recovery Funds (LFRF) delivered to local governments through the American Rescue Plan Act is

strongly encouraged. LFRF contributed to a VATI application are considered match funds.

Pending state allocation of Infrastructure Investments and Jobs Act funds, DHCD reserves the right to determine the source of funds through which awards are made. Nonstate general fund awards

such as this can fund VATI applications and are subject to the rules of the funding source.

VATI Notice of Application

All applicants are required to issue a VATI Notice of Application detailing their intent to apply for VATI funding no later than October 19, 2023. Applicants must submit a copy of the VATI Notice

of Application to DHCD at: vati@dhcd.virginia.gov. The sample notice is located in Appendix A.

VATI Notice of Applications will be posted on DHCD’s VATI webpage no later than 5 business days after the submission deadline.

Application Due Date

Applications are to be submitted by 11:59 p.m. on December 19, 2023. Please note that DHCD Offices close at 5:00 p.m. Therefore, staff will not be available to provide CAMS technical

assistance after 5:00 p.m.

Challenge Process

Prospective challengers are strongly encouraged to contact applicants directly and discuss the contested project area before submitting a challenge as project areas can often be re-scoped to

remove overlap. Evidence of serviceability must be demonstrated by showing a reasonable number of customers within the area of claimed serviceable units.

Planned service to a proposed project area is eligible for the purpose of a challenge if state or federal funds have been awarded and the provider has committed to providing service to the areas using these state or federal funds. Federally and state funded areas with existing agreements to build service to, or are currently served with, access to internet at speeds less than 100/20 Mbps are

eligible for funding under the VATI program. Federally funded areas with service obligations at or over 100/20 Mbps will not be considered for funds managed and awarded through the VATI grant making process, unless otherwise outlined in these guidelines and criteria.

In some cases, recipients of federal or state funds were awarded funding to provide service at less than 100/20 Mbps but provide service over this threshold. In instances where the network infrastructure in the previously funded areas under this scenario has been constructed, an internet service provider must submit a challenge on the basis of actual serviceability in the previously funded area. In instances where network infrastructure has not been constructed in the previously funded area, a challenger must provide speed test data from existing service territories in Virginia to be

considered as that provider’s capability to provide service over the 100/20 Mbps threshold. Please 13 | Page

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see Appendix C for additional guidance on the number of speed tests required and acceptable practices for conducting speed tests. DHCD reserves the right to request verified speed tests at times of peak network usage and street level data of customers receiving service within the proposed project area in federally awarded areas to ensure serviceability.

Areas adjacent to state or federally funded areas may be eligible for a challenge if the challenger demonstrates existing awards will cover the adjacent area. If an incumbent provider serves one side of a roadway, but will not connect the other side, that unserved side of the road is eligible for VATI funding. In these instances, the applicant must prove the incumbent provider will not connect the unserved side of the roadway. The challenger must commit to serving the adjacent areas at speeds equal to or greater than the VATI minimum deployment speed.

DHCD will post electronic copies of all submitted applications to the agency website on or by January 4, 2024. Providers wishing to submit a challenge must provide the information required in this section no later than February 8, 2024. Applicants will be notified if their proposed project area is being challenged by February 15, 2024 and will have 15 business days from notification of a challenge to provide rebuttal information to DHCD.

Providers wishing to submit challenges on multiple applications must submit a separate challenge

for each application. Challenges can be made to portions of a proposed project area without invalidating the entire application. DHCD reserves the right to invalidate a portion(s) of a proposed project area, aggregate challenges by different providers to determine the percentage of serviceable units served in a proposed project area and invalidate insufficient challenges.

Challengers, individually or collectively, must demonstrate that more than 20% for wireline projects, or 25% for wireless projects, of serviceable units in the project area have access to speeds

above 100/20 Mbps as of the date of the application or that the application is ineligible as a result of committed state or federal funding subject to the conditions described above.

DHCD must receive all of the information detailed below or the challenge will be deemed incomplete and invalid. Challengers must provide:

1. A signed and notarized affidavit affirming the challenge and attached information is true.
2. Current Federal Communications Commission (FCC) Form 477 or equivalent.
3. Minimum/maximum speeds available in the proposed project area.
4. Number of serviceable units within the proposed project area and provide the speeds those serviceable units are able to receive.
5. Street level data of customers receiving service within the proposed project area.
6. Point shapefiles that show each proposed passing in the challenged area, designated by a

singular mapped point, in the challenged area containing attribute data showing the addresses of each point; and Polygon shapefiles delineating the general challenged area(s). (Note: These files must be provided in .zip file form)

1. For wireless providers: Heat maps indicating received signal strength indicator (RSSI) in the challenged area, accounting for terrain and peak vegetation (Note: These files must be provided in .zip file form)
2. Wireless providers must also note if the bandwidth is shared or dedicated in

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the challenged area.

1. Using the project area map submitted by the applicant, create a map indicating where the

challenger’s serviceable units are located in the proposed project area. Challengers are encouraged to submit additional maps and information if necessary. 10. If challenging due to planned state or federal funding, documentation detailing commitment to provide service in or adjacent to the proposed project area. 11. If the challenger has not submitted service territory data meeting the

requirements of the Internet Service Provider Service Territory Data Submission Guidelines, the challenger must submit service territory data for the challenge to be considered. 12. If challenging an application on the basis of variable speed technologies (i.e., DSL, Fixed Wireless, etc.), challengers are required to submit verified speed tests at times of peak network usage on all or portion(s) of the challenged area.

Please see Appendix C for additional guidance on the number of speed tests

required and acceptable practices for conducting speed tests.

DHCD strongly encourages challengers to contact DHCD staff for technical assistance regarding the shapefile requirements prior to challenge submittal. DHCD encourages challengers to use the VATI applicant’s point shapefiles, as posted on the Open Data Portal to “cut out” or “clip” addresses being challenged to create the point shapefiles to be submitted under the challenge. This practice ensures accurate representation of challenged areas within the VATI application area and

allows the challenged locations shapefiles to be exact matches geographically to the VATI application shapefiles submitted.

DHCD will review all applicable challenge and rebuttal information to determine if a challenge is credible. DHCD reserves the right to request verified speed tests at times of peak network usage on all or portion(s) of the challenged area. If verified speed tests are requested by DHCD, the

challenger will have 10 days to respond with documentation requested by DHCD. DHCD reserves the right to re-scope any credibly challenged VATI application and fund the remaining portion(s) of the application. Please see Appendix C for additional guidance on the number of speed tests required and acceptable practices for conducting speed tests. DHCD shall notify the applicant and challenger in writing if a challenge is credible no later than April 12, 2024. Upon notification of challenge determination, applicants will have 10 days to submit rescope materials, which include: an updated map of the application area reflecting removal of the challenged area(s), point and

polygon shapefiles of the updated application area, the Funding Sources Table, the VATI Passings Form, the RDOF Passings Form (if applicable), and the Derivation of Costs.

Any proposals to modify a previously awarded project are subject to the VATI challenge process adopted in the most recent guidelines if a new project area has been added.

Implementation Deadline

Applicants must demonstrate that projects will be completed within 18 months. The project timeline begins with the contract execution between the applicant and DHCD. DHCD will consider longer project timelines for larger project areas if applicants can sufficiently detail the reasoning for an 15 | Page

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extended timeline in their application. Applicants are encouraged to phase larger scale projects, and DHCD reserves the right to fund only a phase(s) of a proposed project.

Extensions may be considered for awarded projects that encounter delays due to circumstances

outside of the applicants’ control. Contact DHCD staff for all questions regarding project scope.

Organizational and Management Capabilities

To participate in VATI, applicants and co-applicants must demonstrate suitable organizational and management capabilities. To determine whether applicants meet this criterion, applicants and private sector partner(s), must submit the following documents and/or attest to each of the

following:

1. Documentation that proposed project area is unserved based on VATI criteria.
2. Private co-applicant must provide proof that they have filed an FCC Form 477 by the two

most recently submitted forms prior to submission of application. If the private co-applicant has not submitted an FCC Form 477 in previous years, the co-applicant must provide reasoning for not submitting, business background, number of customers, overview of assets, or equivalent information.

1. Point shapefiles are shapefiles that show each proposed passing in the application area, designated by a singular mapped point, in the project area containing attribute data showing the addresses of each point. Polygon shapefiles delineating the general project

area(s). Polygon shapefiles delineating the general project area(s). (Note: These files must be provided in .zip file form)

1. For wireless providers: Heat maps indicating projected received signal strength indicator (RSSI) in the application area accounting for terrain and peak vegetation (Note: These files must be provided in .zip file form)
2. Projects must be fully financed through a combination of the total requested funds,

committed matching funds from the applicants, and in-kind resources.

1. Private co-applicants must document current assets (i.e., total amount of available cash and equivalents, callable capital, in an amount no less than the proposed committed funding or a commitment letter for financing) in the amount of match funds committed for the project at the time of application. Per VATI’s enabling budget language, the private co-applicant must contribute an appropriate level of match to the total project cost.

1. Applicants must be in good standing in performance of any and all existing Commonwealth of Virginia contracts and in compliance with all federal, state, and local laws.
2. If the co-applicant has not submitted service territory data meeting the requirements of the Internet Service Provider Service Territory Data Submission Guidelines, the co-applicant must submit service territory data for the application to be considered.

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DHCD reserves the right to request verified speed tests distributed throughout a service territory at times of peak network usage from a co-applicant’s existing network to verify a co-applicant’s capability to provide broadband service at speeds at or above 100/20 Mbps. Please see Appendix C

for additional guidance on the number of speed tests required and acceptable practices for conducting speed tests.

Funds managed and awarded through the VATI grant making process may be requested to cover administrative costs please see the table below regarding allowable administrative expenses.

Allowable Request for Total Award Administration

<$1 million $50,000 >$1 million, <$5 million $100,000

>$5 million, <$10 million $200,000 >$10 million $300,000 .

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[TABLE 17-1] Total Award | Allowable Request for Administration <$1 million | $50,000 >$1 million, <$5 million | $100,000 >$5 million, <$10 million | $200,000 >$10 million | $300,000

[/TABLE]

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Evaluation Criteria

Project Description and Need (Maximum of 75 points) Describe the fundamentals of the project, including: ● Overview of the project area and how it was determined ● Internet speeds to be offered ● Network design ● How the project achieves universal broadband coverage in a locality, or how a project fits into a larger plan for universal broadband coverage. Note: Applicants will only

achieve maximum scoring in this section if the application reaches universal coverage in the county or counties included in the application.

Project Readiness (Maximum of 40 points) Describe the capacity to successfully implement the project, including: ● Additional leverage to improve the project ● Marketing activities, including digital literacy efforts, to ensure a sufficient take rate

● Description of the project management plan, including key contacts, projected timeline, and history of managing similar projects/grants

Project Budget and Cost-Appropriateness (Maximum of 135 points) Describe the project budget, including: ● Detailed project budget, including derivation of costs and documentation of cost estimates, delineated by each service area

● Information to calculate the Cost Benefit Index score ● Number of serviceable units passed and the breakdown of those passings ● Breakdown of matching funds and in-kind resources

Commonwealth Priorities (Maximum of 50 points) Describe how the project would reflect priorities of the Commonwealth, including: ● Passings of significant impact

● Unique partnerships involved in the project ● Digital equity efforts ● Capacity for scalability

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Application Questions

Project Description and Need (75 points)

1. Describe why and how the project area(s) was selected. Describe the proposed geographic area including specific boundaries of the project area (e.g., street names, local and regional boundaries, etc.). Attach a copy of the map of your project area(s). Label map: Attachment 1 – Project Area Map.

1. List existing providers in the proposed project area and the speeds offered. Describe your outreach efforts to identify existing providers and how this information was compiled

with source(s).

1. Describe if any areas near the project have received funding from federal grant programs, including but not limited to Connect America Funds II (CAF II), ACAM, ReConnect, Community Connect, and Rural Digital Opportunity Funds (RDOF). If there have been federal funds awarded near the project area(s), provide a map showing these areas, verifying the proposed project area does not conflict with these areas. Label Map: Attachment 2 – Documentation on Federal Funding Area.

1. Overlap: To be eligible for VATI, applicants must demonstrate that the proposed project area(s) is unserved. An unserved area is defined as an area with speeds below 100/20 Mbps and with less than 25% service overlap within the project area for wireless projects and 20% for wireline projects. Describe any anticipated service overlap with current providers within the project area. Provide a detailed explanation as to how you determined the percentage overlap. Label Attachment: Attachment 3 – Documentation Unserved

Area VATI Criteria.

1. Total Passings: Provide the number of total serviceable units in the project area.

Applicants are encouraged to prioritize areas lacking 25 Megabits per second download and 3 Megabits per second upload speeds, as they will receive priority in application scoring. For projects with more than one service area, each service area must have delineated passing information. Label Attachment: Attachment 4 – Passings Form.

a. Of the total number of VATI passings, provide the number of residential, business, non-residential, and community anchors in the proposed project area.

b. If applicable, of the total number of RDOF passings, provide the number of residential, business, non-residential, and community anchors in the proposed project area. c. If applicable, provide the number of passings that will require special construction costs, defined as a one-time fee above normal service connection fees required to provide broadband access to a premise. Describe the methodology used for these projections. d. If applicable, provide the number of passings included in the application that will

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receive broadband access because special construction costs have been budgeted in the VATI application. Describe the methodology used for determining which passings with special construction costs were budgeted in the application.

e. Provide the number of passings in the project area that have 25/3 Mbps or less.

Describe the methodology used for these projections. (Up to 15 points)

1. Describe if any blocks awarded in Rural Digital Opportunity Fund (RDOF) are included in the VATI application area. If RDOF areas are included in the VATI application, provide a map of these areas and include information on number of passings in RDOF awarded areas within the VATI application area, and Census Block Group ID number for each block group in the project area. Label Attachment: Attachment 5 – RDOF Awarded Areas Form in VATI Area

1. For wireless projects only: Please explain the ownership of the proposed wireless infrastructure. Please describe if the private co-applicant will own or lease the radio mast, tower, or other vertical structure onto which the wireless infrastructure will be installed.

Also, provide an estimate of the number of simultaneous subscribers that can be served in an area at the chosen speed.

1. Network Design: Provide a description of the network system design used to deliver broadband service from the network’s primary internet point(s) of presence to end users, including the network components that already exist and the ones that would be added by the proposed project. Provide a detailed explanation of how this information was determined with sources. Provide information on how capacity for scalability, or expansion, of how the network can adapt to future needs. If using a technology with shared bandwidth, describe how the equipment will handle capacity during peak intervals. For wireless projects, provide a propagation map for the proposed project area with a clearly defined legend for scale of map. Label Map: Attachment 6 – Propagation Map Wireless Project.

10. Speeds: Describe the internet service offerings, including download and upload speeds, to be provided after completion of the proposed project. Detail whether that speed is based on dedicated or shared bandwidth and detail the technology that will be used. This description can be illustrated by a map or schematic diagram, as appropriate. List the private co-applicant’s tiered price structure for all speed offerings in the proposed project

area, including all speed offerings. Please note, DHCD reserves the right to request verified speed tests distributed throughout a service area at times of peak network usage from a co-applicant’s existing network to verify a co-applicant’s capability to provide broadband service at speeds at or above 100/20 Mbps. Describe the co-applicant’s methodologies for conducting speed tests. (Up to 10 points)

11. Explain how the proposed project achieves universal broadband coverage for the locality or fits into a larger plan to achieve universal broadband coverage for the locality. If applicable, explain the remaining areas of need in the locality and a brief description of the plan to achieve universal broadband coverage. (Up to 50 points)

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Project Readiness (40 points)

12. Describe the current state of project development, including but not limited to planning,

preliminary engineering, identifying easements/permits, status of MOU or MOA, and final design. Prepare a detailed project timeline or construction schedule, identifying specific tasks, staff, contractor(s) responsible, collection of data, etc., and estimated start and completion dates. Applicants are encouraged to extensively discuss, where applicable, easements relating to railroad crossings, federally owned lands and parks, partnerships with the Virginia Department of Transportation, and mobile home parks.

Applicants must include Memorandums of Understanding (MOUs)or Memorandums of Agreement (MOAs) between applicants (drafts are allowable). Label Attachments: Attachment 7 – Timeline/Project Management Plan; Attachment 8 – MOU/MOA between Applicant/Co-Applicant; (up to 10 points)

13. Has the applicant or co-applicant received any VATI grants? If so, provide a list of these grants, with a detailed summary of the status of each.

14. Matching funds: Complete the funding sources table indicating the cash match and in- kind resources from the applicant, co-applicant, and any other partners investing in the proposed

project (VATI funding cannot exceed 80 percent of total project cost). In-kind resources include, but are not limited to grant management, acquisition of rights of way or easements, waiving permit fees, force account labor, etc. Please note that a minimum 20% match is required to be eligible for VATI, the private sector provider must provide 10% of the required match. If the private co-applicant cash match is below 10% of total project cost, applicants must provide financial details demonstrating appropriate private investment. If applicants and co-applicants are seeking to include prior expended funds as matching funds, Attachment 11 must be completed. Label Attachments: Attachment 9 - Funding Sources Table; Attachment 10 –Documentation of Match Funding; Attachment 11 – Prior Expended Match Form

15. Leverage: Describe any leverage being provided by the applicant, co-applicant, and partner(s) in support of the proposed project. (Up to 10 points)

16. Communications Plan: Describe efforts to keep the public informed of project progress and the broadband adoption plan. a. Explain how you plan on communicating the project status to stakeholders, including but not limited to County leadership, project areas residents, etc. (Up to 10 points)

b. Explain how you plan to promote customer take rate, including marketing activities, outreach plan, and other actions to reach the identified serviceable units

within the project area. Provide the anticipated take rate and describe the basis for the estimate. (Up to 10 points)

c. Describe any digital literacy efforts to ensure residents and businesses in the proposed project area sufficiently utilize broadband. Please list any partnering organizations for digital literacy, such as the local library or cooperative extension office.

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17. Project Management: Identify key individuals who will be responsible for the management of the project and provide a brief description of their role and responsibilities for the project. Present this information in table format. Provide a brief

description of the applicant and co-applicant’s history and experience with managing grants and constructing broadband communication facilities. Project Budget and Cost Appropriateness (135 points) 18. Budget: Applicants must provide a detailed budget that outlines how the grant funds will

be utilized, including an itemization of equipment, construction costs, and a justification of proposed expenses. If designating more than one service area in a single application, each service area must have delineated budget information. For wireless projects, please include delineated budget information by each tower. Expenses should be substantiated by clear cost estimates. Include copies of vendor quotes or documented cost estimates supporting the proposed budget. Label Attachments: Attachment 12 – Derivation of Costs; Attachment 13 - Documentation of Supporting Cost Estimates. (Up to 10 points)

19. The cost benefit index comprises state cost per unit passed. Individual cost benefit scores are calculated and averaged together to create a point scale for a composite score. Provide the following: a. Total VATI funding request b. Number of serviceable units (Up to 125 points)

Commonwealth Priorities (50 points)

20. Additional points will be awarded to proposed projects that reflect Commonwealth priorities. If applicable, describe the following: a. Businesses, community anchors, or other passings in the proposed project area that will have a significant impact on the locality or region because of access to broadband. b. Unique partnerships involved in the proposed project. Examples include electric utilities, universities, and federal/state agencies. c. Digital equity efforts to ensure low to moderate income households in the proposed project area will have affordable access to speeds at or above 100/20 Mbps, include information regarding the internet service provider’s participation in the Affordable Connectivity Program. d. The co-applicant’s efforts to mitigate supply chain constraints, including labor shortages and order-to-delivery delays on telecommunications materials required to construct broadband networks.

e. The co-applicant’s efforts to mitigate costs and delays that may be associated with make-ready and other permitting requirements anticipated for network deployment. f. The applicant’s and co-applicant’s efforts to promote broadband adoption, including, but not limited to telehealth, smart farming, e-entrepreneurship, and distance learning.

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Additional Information

21. Please attach any letters of support from stakeholders. If the applicant is not a locality(s)

in which the project will occur, please provide a letter of support from that locality.

Attachment 14 – Letters of Support.

22. Provide any other information that the applicant desires to include. Applicants are limited to four additional attachments.

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List of Required Attachments, PDF Format Required

• All Attachments MUST be uploaded in PDF format

1. Map(s) of project area, including proposed infrastructure. ● Label Attachment: Attachment 1 – Project Area map
2. Documentation of Federal Funding (CAF/ACAM/USDA/RDOF, etc.…) in and/or

near proposed project area. ● Label Attachment: Attachment 2 – Documentation of Federal Funding Area

1. Documentation that proposed project area is unserved based on VATI criteria ● Label Attachment: Attachment 3 – Documentation Unserved Area VATI Criteria
2. Passings Form (Please use template provided) ● Label Attachment: Attachment 4 – Passings Form
3. Documentation of RDOF awarded area in VATI project area, if needed ● Label Attachment: Attachment 5 – RDOF Awarded Areas included in VATI Application
4. Propagation Map and Heat Map if Wireless Project ● Label Attachment: Attachment 6 – Propagation Map (Wireless Projects only)
5. Timeline/Project Management Plan ● Label Attachments: Attachment 7 – Timeline Project Management Plan
6. MOU/MOA between applicant/co-applicant (can be in draft form) ● Label Attachment: Attachment 8 – MOU.MOA between Applicant/Co-Applicant
7. Funding Sources Table

● Label Attachment: Attachment 9 – Funding Sources Table 10. Documentation for match funding ● Label Attachment: Attachment 10 – Documentation of Match Funding 11. Prior Expended Match Form ● Label Attachment: Attachment 11 – Prior Expended Match Form 12. Derivation of Cost (Project Budget) ● Label Attachment: Attachment 12 – Derivation of Costs 13. Documentation supporting project costs (e.g., vendor quotes) ● Label Attachment: Attachment 13 – Documentation of Supporting Cost Estimates 14. Letters of Support ● Label Attachment: Attachment 14 - Letters of Support 15. Two most recent Form 477 submitted to FCC. ● Label Attachment: Attachment 15 – Two most recent Form 477 submitted to the FCC or equivalent. 16. Point and Polygon shapefiles, in .zip file form, showing proposed passings and project area

● Label Attached. Zip Folder: Attachment 16 - Point and Polygon Shapefiles 17. For wireless applicants: shapefiles, in .zip file form, indicating RSSI projections in the application area ● Label Attached. Zip Folder: Attachment 17 – RSSI Projection Shapefiles 18. Label Additional Attachments as: ● Attachment 18 – XXXXXXX ● Attachment 19 – XXXXXXX ● Attachment 20 – XXXXXXX

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List of Required Attachments, Shapefiles

• All shapefiles MUST be functional

1. Point shapefiles that show each proposed passing in the application area as a singular mapped point containing attribute data showing the addresses of each point.

1. Polygon shapefiles delineating the general challenged area(s).

1. For wireless providers: Shapefiles displaying heat maps indicating received signal strength indicator (RSSI) in the application area accounting for terrain and vegetation.

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Virginia Telecommunication Initiative (VATI)

Freedom of Information (FOIA) Policy Effective July 1, 2019 § 2.2-3705.6:

(32) Information related to a grant application, or accompanying a grant application, submitted to the Department of Housing and Community Development that would (i) reveal (a) trade secrets, (b) financial information of a grant applicant that is not a public body, including balance sheets and financial statements, that are not generally available to the public through regulatory disclosure or otherwise, or (c) research-related information produced or collected by the applicant in the conduct of or as a result of study or research on medical, rehabilitative, scientific, technical, technological, or scholarly issues, when such information has not been publicly released, published, copyrighted, or patented, and (ii) be harmful to the competitive position of the applicant. The exclusion provided by this subdivision shall only apply to grants administered by the Department, the Director of the Department, or pursuant to § 36-139, Article 26 (§ 2.2-2484 et seq.) of Chapter 24, or the Virginia Telecommunication Initiative as authorized by the appropriations act.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

a. Invoking such exclusion upon submission of the data or other materials for which protection from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

c. Stating the reasons why protection is necessary.

The Department shall determine whether the requested exclusion from disclosure is necessary to protect the trade secrets or confidential proprietary information of the applicant. The Department shall make a written determination of the nature and scope of the protection to be afforded by it under this subdivision.

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Virginia Telecommunication Initiative (VATI) Freedom of Information (FOIA) Policy

All entities requesting Freedom of Information (FOIA) exemption for information pertaining to the VATI program shall submit the request for exemption in writing detailing the documentation to vati@dhcd.virginia.gov. DHCD FOIA exemptions do not extend to local government co-applicants. Only materials submitted to DHCD directly are subject to consideration for a FOIA-exemption. Pursuant to 2.2-3705.6-32, the Department of Housing and Community Development (DHCD) will make a written determination within ten (10) days of the request as to whether FOIA-exemption will be afforded as well as the nature and scope of the protection. Upon receipt of the written determination from DHCD documents must be submitted to vati@dhcd.virginia.gov. All exempted information will be securely maintained and accessed by VATI staff only.

Grant Applications

Consistent with VATI Guidelines, DHCD will continue to make available online submitted VATI applications. DHCD respects the right of the public to access to public information about the VATI program and encourages applicants to only request a FOIA-exemption when absolutely necessary. Applications submitted through CAMS must only include information that is open to the public. Applicants may request to submit supplementary information to the application that includes a FOIA-exemption, pursuant to “§ 2.2-3705.6” for information related to a grant application that may make the application more competitive. FOIA-exemption requests must be sent directly to vati@dchd.virginia.gov, and the applicant must indicate for which VATI application the information corresponds. Applicants wishing to submit multiple FOIA exemption requests for multiple VATI applications must do so individually in separate requests.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

a. Invoking such exclusion upon submission of the data or other materials for which protection from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

c. Stating the reasons why protection is necessary.

The Department shall determine whether the requested exclusion from disclosure is necessary to protect the trade secrets or confidential proprietary information of the applicant. The Department shall make a written determination of the nature and scope of the protection to be afforded by it under this subdivision.

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Challenge Applications

Prospective challengers are strongly encouraged to contact applicants directly and discuss the contested project area before submitting a challenge. Many issues can be resolved without a formal challenge process.

Entities wishing to request FOIA exemption on information related to a VATI application challenge must submit any requested information directly to vati@dhcd.virginia.gov. Incumbents with information such as existing street level data in a proposed project area are required to submit a challenge. Challengers wishing to request exemption for multiple challenges must do so individually, in separate requests. Applicants who have received a challenge will be notified and may request FOIA exemption, pursuant to “§ 2.2-3705.6-3” of the Code of Virginia for information pertaining to their rebuttal.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

a. Invoking such exclusion upon submission of the data or other materials for which protection from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

c. Stating the reasons why protection is necessary.

The Department shall determine whether the requested exclusion from disclosure is necessary to protect the trade secrets or confidential proprietary information of the applicant. The Department shall make a written determination of the nature and scope of the protection to be afforded by it under this subdivision.

Grant Monitoring

Projects awarded funds managed and awarded through the VATI grant making process currently work with DHCD to monitor the completion and success of those projects. Entities wishing to request FOIA exemption on information relevant to evaluating the success of awarded projects, including take rate, must submit any requested information directly to: vati@dhcd.virginia.gov

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

d. Invoking such exclusion upon submission of the data or other materials for which protection

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from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

c. Stating the reasons why protection is necessary The Department shall determine whether the requested exclusion from disclosure is necessary to protect the trade secrets or confidential proprietary information of the applicant. The Department shall make a written determination of the nature and scope of the protection to be afforded by it under this subdivision.

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Definitions Adjacent – adjoining parcels sharing a roadway, private or public, other than highways or expressways as a common boundary

Business – An organization or entity that provides goods or services in order to generate profit.

Businesses based in residential homes can count if they are a registered business (BPOL, LLC, etc.).

Community Anchor - schools, libraries, medical and health care providers, public safety entities, community colleges and other institutions of higher education, and other community support organizations and agencies that provide outreach, access, equipment, and support services to facilitate greater use of broadband service by vulnerable populations, including low-income, unemployed, and the aged.

Digital Subscriber Line (DSL) – A technology for bringing high-bandwidth information to homes and small businesses over ordinary copper telephone lines.

Eligible Project Costs – Expenses eligible for reimbursement under the VATI grant.

Fiber-to-the-Home (FTTH) – A network that delivers internet service over optical fiber directly to an end-user home, business, or other Unit.

Fixed Wireless – Wireless devices or systems that are situated in fixed locations.

Hybrid Fiber Coaxial (HFC) – A broadband network combining optical fiber and coaxial cable.

Last-Mile – Components of a network that provide broadband service to end-user premises or devices through an intermediate point of aggregation (e.g., remote terminal, fiber node, wireless tower, or other equivalent access point).

Leverage-Non-match cash or non-match in-kind resources committed to a proposed project that do not qualify as match (i.e., federally funded projects like CAFII, A-CAM, etc.) or being used as match (i.e., volunteer labor, engineering or design, etc.).

Middle-Mile – Network components that provide broadband service from one or more centralized facilities (e.g., the central office, the cable head-end, the wireless switching station, or other equivalent centralized facilities) to an Internet point of presence.

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Non-Residential Passing – Places of worship, federal, state, or local facilities or other potential customers that are neither a residence, business, or a community anchor institution (as defined above).

Passing – any structure that can receive service. Multi-unit structures may be counted as more

than 1 passing, provided individual connections and accounts are planned at that structure.

Peak Interval - Weekdays from 7:00 p.m. – 11:00 p.m. local time.

Point Shapefiles – shapefiles that show each proposed passing as a singular mapped point, in the application or challenged area, containing attribute data showing the addresses of each point.

Polygon Shapefiles - shapefiles delineating the general project area(s).

RSSI - Received Signal Strength Indicator, or RSSI, is an estimated measure of power level that a wireless client device is receiving from an access point or router. See Appendix B for more information.

Service Area – Refers to the geographic territory in which an applicant has proposed to provide service.

Serviceable Units – Properties that are eligible for broadband service without additional special construction costs from the property owner/subscriber.

Special construction costs - one-time fees above normal service connection fees required to provide broadband access to a premise (i.e., service connection drop fee for serviceable units beyond the ISPs set standard length or require nonstandard equipment)

Street Level Data – Address ranges or specific addresses from an existing provider along with the existing number of customers within those ranges. No personal information on specific

customers will be requested.

Unserved – Properties that currently have access to internet speeds below 100 Megabits per second (Mbps) download and 20 Megabits (Mbps) upload.

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Appendix A-Sample VATI Application Notice

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2024 Virginia Telecommunication Initiative

SAMPLE VATI APPLICATION NOTICE FORMAT

[Insert Date] Tamarah Holmes, Ph.D.

Director10 Office of Broadband Department of Housing and Community Development 600 East Main Street, Ste 300 Richmond, VA 23219

Dear Dr. Holmes: I am providing this VATI Application Notice t o notify the Virginia Department of Housing and Community Development of [insert name of unit of local government] and [private

provider (optional)]’s may submit an application for the FY2024 Virginia Telecommunication Initiative (VATI).

[Name of unit of local government, organization] and [private provider (optional)] intends to submit an application for [summary description of Project to be funded] within approximately [proposed Project Area(s)].

[Name] will be our main point of contact for the purposes of the application process, and can be reached at:

[Mailing Address] [Phone Number] [Email Address]

[Name of applicant government, organization and [ private provider (optional)] understands that this VATI Application Notice is required in order to submit an application for the 2024 Virginia Telecommunication Initiative and that this notice is not binding on the entity represented by the undersigned, Virginia Department of Housing and Community Development.

[Type the closing]

[signature] Type the sender’s name] [Type the sender’s title]

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Appendix B - Received Signal Strength Indicator

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Received Signal Strength Indicator

RSSI: Received Signal Strength Indicator is an estimated measure of power level that a wireless client device is receiving from an access point or router.

At larger distances, the signal becomes weaker and the wireless data rates become slower, leading to a lower overall data throughput. RSSI is measured in decibels from 0 to -120, the closer the value to 0 the stronger the signal will be, -55 is considered the best possible signal with measures of -90 and below considered unusable signal. Indoor best practices for mixed use networks see RSSI values of -75 to -80 and for session-based networks (Video Conferencing, Wi-Fi calling, etc.)

• 60 to -65

Below figure (1) shows an example of the RSSI distribution around a wireless site. Please note this is not an actual representation of wireless coverage maps and shows an unimpeded representation of wireless coverage.

Figure (1)

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Appendix C – Requirements of Speed Tests

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Requirements of Speed Tests

As outlined in VATI Program Guidelines and Criteria, DHCD reserves the right to request verified speed tests on all or portion(s) of a co-applicants’ or challenger’s existing network. Upon the request of DHCD, verified speed tests must be conducted at times of peak network usage and be distributed throughout a challenged area or service territory.

DHCD prefers speed tests be conducted at the access point (i.e., customer premise equipment, router, or modem) at the end-user location. Recognizing the feasibility constraints of conducting

speed tests at end-user locations, speed tests that are reported by the management application software at the network operations center will also be considered as valid.

The percent of required speed tests on a co-applicant’s or challenger’s existing network will depend on the size of the challenged area.

Requirements of Co-Applicants:

If DHCD requests co-applicants to submit verified speed tests distributed throughout a service territory at times of peak network usage from a co-applicant’s existing network. The number of speed tests should be no less than 10% of the passings included in the application area. In the event the co-applicant does not have enough customers to achieve the required 10% or greater speed tests based on the number of passings included in the application area, DHCD will consider field tests data to satisfy the 10% requirement. When submitting this information to DHCD, speed tests or field tests must be listed in a spreadsheet along with the address of the unit or location at which the speed test or field test was conducted. If these materials submitted are incomplete, DHCD will consider the application invalid.

Requirements of Challengers:

If challengers are required to submit verified speed tests as a part of their challenger or are requested by DHCD to submit speed test information, the number of required speed tests will be based upon the total number of challenged units. Please see the table below for the required number of speed tests.

Number of Less than 500 500 or Greater, but 1000 or Greater Challenged less than 1000 Locations within an Application Area Required Percentage 10% 7.5% 5%

of Speed Tests, based on Total Number of Challenged Units

In the event the challenger does not have enough customers to achieve the required percentage of speed tests, DHCD will consider field tests data to satisfy the requirement. When submitting this information to DHCD, speed tests and field tests must be listed in a spreadsheet along with the address of the unit or location at which the speed test or field test was conducted. If these materials submitted are incomplete, DHCD will consider the application invalid.

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[TABLE 37-1] Number of Challenged Locations within an Application Area | Less than 500 | 500 or Greater, but less than 1000 | 1000 or Greater Required Percentage of Speed Tests, based on Total Number of Challenged Units | 10% | 7.5% | 5%

[/TABLE]

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Virginia Telecommunication

Initiative (VATI)

2024 Program

Guidelines and Criteria

[TABLE 1-1] 2024 Program Guidelines and Criteria

[/TABLE]

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Table of Contents

Background 3 Summary of 2024 VATI Guidelines and Criteria Changes Program 4

Description 6 Definition of Broadband 6

Freedom of Information Act (FOIA) 6 Eligible Applicants 7 Selection Process 7 Infrastructure Investments and Jobs Act 7

Technical Assistance 8 Universal Coverage 8 Eligible Areas 8 Previously Funded Areas 9 Multiple Applications 11 Project Financing 11 VATI Notice of Application 12 Challenge Process 12 Implementation Deadline 14 Organizational and Management Capabilities 15 Application Due Date 16 Evaluation Criteria 17 Application Questions 19 List of Required Attachments, PDF Format Required 23 List of Required Attachments, Shapefiles 24 Freedom of Information (FOIA) Policy 27

Definitions 30 Appendix A-Sample VATI Application Notice 32

Appendix B - Received Signal Strength Indicator 34 Appendix C - Requirements of Speed Tests 36

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Background

The digital divide—the lack of universal broadband—is a critical infrastructure issue for community and economic development, promoting sustainability, growth, health care access via telemedicine, and workforce improvement.

It also enhances educational opportunities via distance learning and fosters an entrepreneurial economy for home-based and small businesses to compete globally.

Disconnected communities struggle to retain businesses due to slow or limited broadband, which is vital for online banking, e-commerce, marketing, customer service, and communication in the modern economy.

For guidance or questions on project development, VATI, guidelines, or criteria, contact:

VATI email address vati@dhcd.virginia.gov

Tamarah Holmes, Ph.D. Director, Office of Broadband

Caroline Luxhoj, VATI Program Manager

Cole McAndrew, Broadband Policy Planner

Questions about your application: vati@dhcd.virginia.gov

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Summary of Changes to the 2024 VATI Guidelines and Criteria

BEAD Program Funding

The Department of Housing and Community Development’s Office of Broadband has been

designated by Governor Youngkin as the recipient and administering agent for BEAD funding for Virginia. BEAD and state funds are under the Virginia Telecommunication Initiative; proposals for BEAD will follow federal guidance, while those for state funds will be scored and governed separately.

administered via FY24 VATI Guidelines and Criteria.

Eligible applicants are encouraged to apply for both funding sources, with

Consideration of area eligibility; proposals can receive funds from both programs if eligible and non-duplicative. DHCD may make determinations on VATI awards based on ISP capacity, technology feasibility under BEAD, and funding eligibility, among other factors.

partially award any application and may request applicants and internet service providers provide DHCD may request information for parts of an area during the application process for state funds.

Applicants, including ISPs, are encouraged to contact DHCD before applying for BEAD or state funds to discuss program alignment and discrepancies.

Connect America Fund Phase II

In 2018, FCC’s CAF-II auction allocated over $108 million to extend broadband

infrastructure access to over 39,800 locations across the Commonwealth. The performance requirements of this program are staggered with a construction deadline of 6 years, beginning after ISPs finalize FCC documentation; many areas are built, but some CAF-II awarded areas remain unbuilt.

To address unconstructed areas, ensuring these locations

have broadband access regardless of federal program outcomes.

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Unbuilt CAF-II areas may be included in VATI applications,

if the CAF-II awardee and VATI co-applicant differ and the project provides access before the CAF-II deadline.

DHCD may provisionallly award these areas, contingent on the CAF-II ISP’s de-obligation without FCC penalty.

Project Financing

Eliminated the requirement that applicants and co-applicants must be unsuccessful in prior VATI rounds to count prior match.

Commonwealth Priorities

Under Commonwealth Priorities, co-applicant must address efforts to mitigate costs and delays from make-ready and permitting for deployment.

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Program Description

Administered by DHCD, VATI promotes community growth by preparing communities to build, utilize, and

capitalize on telecom infrastructure. DHCD will fund eligible applicants for last-mile services in unserved areas, awarding amounts based on application quality and quantity.

VATI aims to provide financial assistance to supplement construction costs by private broadband providers, in partnership with

local governments to extend service to currently unserved areas.

Definition of Broadband

Broadband transmits wide bandwidth data over high-speed internet.

For VATI and related programs, broadband is defined as speeds of at least 100

Mbps download and 20 Mbps upload.

Freedom of Information Act (FOIA)

Under VA Code § 2.2-3705.6-32, DHCD can withhold certain public record information from disclosure.

FOIA exempts grant application info that reveals trade secrets, non-public financial data, or unreleased research, which could harm the applicant’s competitive position.

Research data not publicly released or patented, which could harm the applicant’s competitiveness, is also exempt; applicants must request FOIA exemption in writing.

Applicants must request FOIA exemption in writing; shapefiles are not exempt, but RSSI measures are eligible for exemption.

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Eligible Applicants

Applications must be submitted by a government unit (Towns, Cities, Counties, EDAs/IDAs, Planning Districts, School Divisions, etc.) with a private sector ISP as co-applicant. Projects must be owned and operated by the private sector co-applicant. Public networks are eligible if partnered with a private co-applicant serving as the customer-facing ISP.

Public broadband authorities may apply directly for VATI funds without private sector investment, limited to 10% of FY2024 state funds. Applications without private co-applicants will be evaluated with others. DHCD may update guidance after final budget approval.

Selection Process

Awardees will be selected through a competitive application process. Application questions will be

Questions focus on broadband needs, ready-to-construct projects needing financial aid, applicant’s readiness to proceed on time, and access to speeds ≥100 Mbps download and 20 Mbps upload. DHCD may revoke awards for misrepresentation.

Broadband Equity, Access, and Deployment (BEAD) Program Funding

DHCD’s Office of Broadband, designated by Governor Youngkin, is the recipient and administrator of BEAD Program funding for Virginia. Both BEAD funding used for

Broadband and state funds fall under the Virginia Telecommunication Initiative; BEAD proposals will follow federal guidance, while state funds will follow FY24 VATI Guidelines and Criteria.

Applicants are encouraged to apply for both funding sources, considering area eligibility. Projects can receive funds from both if eligible and no

No duplication of funding. DHCD may determine VATI awards based on ISP capacity to meet BEAD requirements, technology feasibility, area eligibility, and may partially award applications or request additional info.

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information for a subset of an area within their original application area during the application process for state general funding.

Applicants, including ISPs, are encouraged to contact DHCD before applying for BEAD or state funds to discuss program alignment and differences.

Technical Assistance

DHCD staff can assist with application development and challenge process for local governments, ISPs, grant writers,

Consultants and VATI stakeholders should contact DHCD and review the broadband toolkit at www.commonwealthconnect.virginia.gov/broadband-toolkit before hiring consultants. Ongoing technical assistance is recommended.

Universal Coverage

DHCD encourages applicants to ensure all projects either achieve or are part of a plan to achieve universal broadband for the locality or region. Localities can find resources for developing a universal broadband plan on the Commonwealth Connect website at www.commonwealthconnect.virginia.gov/broadband-toolkit. DHCD recognizes that due to the nature of wireless projects having an inherent potential of overlap it is strongly encouraged that

Applicants should contact DHCD for assistance. Projects focusing only on dense pockets without nearby unserved areas (cherry picking) harm overall broadband economics and increase costs for universal access.

Eligible Areas

DHCD will award funding to applicants to provide last-mile services, including middle-mile

networks, equipment, or investments to deliver last-mile service to unserved areas, defined as speeds below 100 Mbps download and 20 Mbps upload. Areas under 25 Mbps download and 3 Mbps upload will receive priority.

priority in application scoring.

● For a wireline project, a proposed project area is considered eligible if 20 percent or fewer of serviceable units have access to service with no special construction costs from any provider as of the date of the application. ● For a wireless project, a proposed area is considered eligible if 25 percent or fewer of serviceable units have access to service with no special construction costs from any provider as of the date of the application. Passings with RSSI below -90dbm are not eligible to be included in a VATI application. 8 | Page

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Applicants should include passings with special construction costs for low/moderate income residents, especially those with extended setbacks beyond standard maximum distances from the right of way.

Applicants may include locations lacking broadband due to special construction costs. VATI is suited for extending to scattered sites; LECAP covers costs for scattered locations, not long drops. Contact DHCD for scope discussions.

DHCD discourages relying solely on broadband maps to define unserved areas; maps should be supplemented with further evaluation of broadband options. Contact DHCD for best practices.

Previously Funded Areas

Applicants must verify if their VATI area has received state or federal broadband funds, including programs like VT, Tobacco Revitalization, CAFII, USDA Reconnect, USDA Community Connect, ACAM, and RDOF.

Federally and state-funded areas with existing agreements or current service below 100/20 Mbps are eligible for VATI. Areas with obligations ≥100/20 Mbps are ineligible.

Recipients of federal or state funds awarded to provide service below 100/20 Mbps but over this threshold must submit a challenge based on actual serviceability if infrastructure exists; if not, speed test data from Virginia service areas may be used.

see Appendix C for guidance on speed test numbers acceptable practices for speed tests. In instances where possible, DHCD encourages local governments to explore partnerships with internet service providers which received the previous state or federal award to upgrade coverage in these areas; however, no scoring preference will be assigned to local governments partnering with the state or federally awarded internet service provider during application evaluation.

VATI co-applicants awarded federal funds cannot use them as match but are encouraged to leverage these awards to extend service beyond federal award areas.

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or to accelerate RDOF federal award construction.

Connect America Fund Phase II

In 2018, FCC’s CAF-II auction allocated over $108 million to extend broadband to 39,800 locations, with a 6-year construction deadline after documentation finalization.

internet service provider grantees finalize documentation with the FCC. While many examples across the Commonwealth exist of timely construction of these areas under this program, a limited number of CAF-II awarded areas have yet to be built out.

Unbuilt CAF-II awarded area passings may be included in VATI applications to ensure broadband access regardless of federal program outcomes.

provided the CAF-II awardee and VATI co-applicant are not the same entity and the project timeline would provide broadband access ahead of the CAF-II construction deadline.

The Department of Housing and Community Development may provisionally award these CAF-II funded areas. Awards in these areas will be contingent to the CAF-II awarded internet service provider’s de-obligation of these areas without penalty by the FCC.

Rural Digital Opportunity Fund

On December 7, 2021, FCC announced Phase 1 RDOF results; lower-than-expected funding challenged providers. To accelerate access, passings

RDOF passings in VATI applications may cover infrastructure; they must gain broadband access within the contract period and cannot exceed VATI passings unless DHCD waives this case-by-case.

In some localities, RDOF locations may outnumber remaining unserved passings.

If RDOF passings exceed VATI passings, the co-applicant must explain.

Combining RDOF with VATI

Due to FCC delays, areas preliminarily awarded RDOF are eligible for VATI inclusion regardless of bidder.

Non-VATI RDOF awardees may challenge applications including their areas; credible challenges require removal and a 3-year commitment to provide broadband.

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Challengers must sign an MOU with DHCD and the VATI applicant or locality, committing to construct removed areas by contract execution for FY 2024 VATI awards. DHCD may note; if DHCD determines that a

If a credible challenge is based on a final RDOF award and the awardee defaults after committing to build, they cannot submit future VATI applications for that area unless a local government partner expresses intent.

Unchallenged RDOF areas with an MOU are considered served; otherwise, they are unserved and eligible for VATI.

RDOF areas awarded to non-VATI providers and not challenged are considered unserved and scored accordingly.

Leveraging RDOF in achieving Universal Coverage

If RDOF areas are in a VATI application achieving universal coverage

In counties, each RDOF passing in a VATI application earns ½ the VATI passing score. Multiple applications with

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If multiple co-applicant applications reach universal coverage, RDOF passings in those applications score at ½ VATI passing value.

If RDOF is in a VATI application but does not achieve universal coverage or isn't part of a universal plan, passings score at ¼ VATI value; RDOF valuations apply to businesses and anchors.

DHCD may update guidelines if FCC's Phase I RDOF results change due to federal actions.

Multiple Applications

Local governments may submit multiple applications with different providers and cross-jurisdictional areas; only one last-mile provider per application.

Each application must include one last-mile provider; providers can partner with multiple governments. Multiple applications can cover non-contiguous areas, with clear delineation and data for each jurisdiction.

city.

Project Financing

VATI funding shall not exceed 80% of total project cost. The program is competitive; projects with greater match are more likely to score higher.

Consistent with VATI’s budget language; private co-applicant must contribute at least 10% cash match. If below, applicants must provide financial details.

demonstrating appropriate private investment relative to project density and scope.

Local government expenses from one year before application open date are eligible as match if related to the VATI project and meet criteria. Expenses by ISPs after May 11, 2023 are also eligible if related and meet criteria.

reserves the right to determine validity of matching funds and accept a proportion when necessary. Expenses

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Local government expenses to be considered as match must be included and described in the Prior Expended Match Form as an attachment.

Local government support via Coronavirus Local Fiscal Recovery Funds (LFRF) from the American Rescue Plan Act is

strongly encouraged. LFRF contributed to a VATI application are considered match funds.

Pending state allocation of Infrastructure Investments and Jobs Act funds, DHCD reserves the right to determine award funding sources. Nonstate general fund awards

such awards can fund VATI applications and are subject to funding source rules.

VATI Notice of Application

All applicants must issue a VATI Notice of Application of intent by October 19, 2023, and submit a copy

to DHCD at: vati@dhcd.virginia.gov. The sample notice is in Appendix A.

VATI Notices will be posted on DHCD’s VATI webpage within 5 business days after the deadline.

Application Due Date

Applications are due by 11:59 p.m. on December 19, 2023. DHCD offices close at 5:00 p.m., and staff will not provide CAMS technical assistance after that.

assistance after 5:00 p.m.

Challenge Process

Challengers are encouraged to contact applicants directly and discuss the contested project area before submitting a challenge, as areas can often be re-scoped to

remove overlap. Evidence of serviceability must show a reasonable number of customers within the claimed service area.

Service planned in a project area is challenge-eligible if state or federal funds have been awarded and the provider committed to service. Areas with existing agreements or current service below 100/20 Mbps are

eligible for VATI funding. Areas with service obligations ≥100/20 Mbps are ineligible unless specified otherwise.

Some fund recipients were awarded funds for <100/20 Mbps but now provide over. If infrastructure is built, providers must challenge based on actual serviceability; if not, challengers must submit speed test data from Virginia territories.

considered as the provider’s capability to deliver over 100/20 Mbps. Please

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See Appendix C for speed test guidance. DHCD may request verified tests during peak usage and street-level data to verify serviceability in federally funded areas.

Adjacent areas may be challenge-eligible if existing awards cover them. If an incumbent serves one side but not the other, the unserved side is eligible if the provider won’t connect it. Challengers must commit to serving at or above VATI speeds.

DHCD will post electronic copies of all submitted applications to the agency website on or by January 4, 2024. Providers wishing to submit a challenge must provide the information required in this section no later than February 8, 2024. Applicants will be notified if their proposed project area is being challenged by February 15, 2024 and will have 15 business days from notification of a challenge to provide rebuttal information to DHCD.

Providers must submit a separate challenge for each application.

for each application. Challenges may target parts of a project area without invalidating the whole. DHCD can invalidate parts, aggregate challenges, and invalidate insufficient ones.

Challengers, individually or collectively, must demonstrate that over 20% for wireline or 25% for wireless projects of serviceable units in the project area have access to speeds

above 100/20 Mbps as of the application date or ineligible due to committed state or federal funding under the conditions above.

DHCD must receive all detailed below or challenge is incomplete and invalid. Challengers must provide:

1. A signed and notarized affidavit affirming the challenge and attached information is true.
2. Current FCC Form 477 or equivalent.
3. Minimum/maximum speeds available in the proposed project area.
4. Number of serviceable units in the project area and their speeds.
5. Street-level data of customers receiving service in the project area.
6. Point shapefiles that show each proposed passing in the challenged area, designated by a

a mapped point in the challenged area with attribute data of addresses; and Polygon shapefiles delineating the challenged area(s). (Note: Files must be in .zip form)

1. Wireless providers: Heat maps of RSSI in the challenged area, considering terrain and vegetation (must be in .zip).
2. Wireless providers must also note if the bandwidth is shared or dedicated in

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the challenged area.

1. Using the submitted project area map, create a map indicating where the

challenger’s serviceable units are in the proposed project area. Challengers are encouraged to submit additional maps and info. 10. For challenges due to planned state or federal funding, provide documentation of service commitments in or near the project area. 11. If the challenger hasn't submitted service territory data meeting the

If not meeting ISP Service Territory Data Submission Guidelines, challengers must submit data for consideration. 12. For challenges based on variable speed tech (e.g., DSL, Fixed Wireless), submit verified speed tests during peak usage on all or part of the challenged area.

Please see Appendix C for additional guidance on the number of speed tests

required and acceptable practices for conducting speed tests.

DHCD urges challengers to contact staff for shapefile guidance before submission. Use VATI applicant’s point shapefiles from the Open Data Portal to clip challenged addresses, ensuring accurate representation within the VATI area and

ensures challenged shapefiles match geographically to VATI application shapefiles.

DHCD will review challenge and rebuttal info to assess credibility. DHCD may request verified peak usage speed tests on all or part of the challenged area. If requested, the

challenger has 10 days to respond with DHCD-requested documentation. DHCD may re-scope credible challenges and fund remaining areas. See Appendix C for speed test guidance. DHCD will notify in writing if a challenge is credible by April 12, 2024. After notification, applicants have 10 days to submit rescope materials: updated map showing removed areas, point and

polygon shapefiles of the updated area, Funding Sources Table, VATI Passings Form, RDOF Passings Form (if applicable), and Derivation of Costs.

Proposals to modify awarded projects follow the VATI challenge process if a new area is added.

Implementation Deadline

Applicants must show projects completed within 18 months, starting from contract execution. DHCD may consider longer timelines for larger areas if justified.

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extended timeline if justified. Applicants are encouraged to phase large projects; DHCD may fund only part of the project.

Extensions may be granted for delays caused by circumstances

outside the applicant’s control. Contact DHCD staff for project scope questions.

Organizational and Management Capabilities

Applicants and co-applicants must demonstrate organizational and management capabilities. To verify this, they and private partners must submit the following documents and/or attest to each of the

following:

1. Documentation that proposed project area is unserved based on VATI criteria.
2. Private co-applicant must provide proof of filing FCC Form 477 by the deadline.

most recent forms before application. If the co-applicant hasn't submitted FCC Form 477 previously, they must provide reasons, business background, customer count, assets overview, or equivalent.

1. Point shapefiles show each proposed passing as a mapped point with attribute data of addresses; polygon shapefiles delineate the general project area.

area(s). Polygon shapefiles delineating project area(s). (Files must be in .zip form)

1. For wireless providers: Heat maps showing projected RSSI in the application area, accounting for terrain and vegetation (must be in .zip format).
2. Projects must be fully financed through a combination of the total requested funds,

committed matching funds from the applicants, and in-kind resources.

1. Private co-applicants must document current assets (cash, equivalents, callable capital, or commitment letter) at least equal to the proposed match funds; must contribute an appropriate match per VATI rules.

1. Applicants must be in good standing with all Virginia contracts and comply with federal, state, and local laws.
2. If the co-applicant hasn't submitted service territory data per ISP guidelines, they must submit it for application consideration.

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DHCD may request verified peak usage speed tests across a co-applicant’s network to verify capability at or above 100/20 Mbps. See Appendix C

for guidance on speed test numbers and practices.

Funds awarded via VATI may cover administrative costs; see table below for allowable expenses.

Allowable Request for Total Award Administration

<$1 million $50,000 >$1 million, <$5 million $100,000

>$5 million, <$10 million $200,000 >$10 million $300,000 .

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[TABLE 17-1] Total Award | Allowable Request for Administration <$1 million | $50,000 >$1 million, <$5 million | $100,000 >$5 million, <$10 million | $200,000 >$10 million | $300,000

[/TABLE]

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Evaluation Criteria

Project Description and Need (max 75 pts): Describe project fundamentals, including: overview, area determination, offered speeds, network design, and how it achieves or fits into universal broadband coverage. Note: Applicants will only

achieve max score if the application attains universal coverage in the included counties.

Project Readiness (max 40 pts): Describe capacity to implement, including: leverage, marketing, digital literacy, and ensuring sufficient take rate.

● Project management plan, including key contacts, timeline, and experience managing similar projects/grants

Project Budget and Cost-Appropriateness (max 135 pts): Describe detailed budget, including cost derivation, estimates, and service area breakdown.

● Information to calculate the Cost Benefit Index score ● Number of serviceable units passed and the breakdown of those passings ● Breakdown of matching funds and in-kind resources

Commonwealth Priorities (max 50 pts): Describe how project reflects Commonwealth priorities, including significant impact passings.

● Unique partnerships, digital equity efforts, and scalability capacity

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Application Questions

Project Description and Need (75 points)

1. Describe why and how the project area(s) was selected, including specific boundaries (e.g., streets, local/regional). Attach and label map: Attachment 1 – Project Area Map.

1. List existing providers and speeds in the project area; describe outreach efforts and data compilation.

with source(s).

1. Describe any nearby federal funding (CAF II, ACAM, ReConnect, Community Connect, RDOF). If applicable, provide a map verifying no conflict. Label: Attachment 2 – Federal Funding Map.

1. To qualify for VATI, demonstrate the project area is unserved (speed below 100/20 Mbps, less than 25% overlap for wireless, 20% for wireline). Describe and explain overlap calculations. Label: Attachment 3 – Unserved Area.

Area VATI Criteria.

1. Total Passings: Provide the number of total serviceable units in the project area.

Applicants should prioritize areas below 25 Mbps download or 3 Mbps upload speeds for scoring. For multiple service areas, delineate passings; label Attachment 4 – Passings Form.

a. Provide counts of residential, business, non-residential, and community anchors among VATI passings in the project area.

b. If applicable, provide RDOF passings counts by type. c. If applicable, specify passings needing special construction costs, defined as a one-time fee above normal connection costs, and describe the projection methodology. d. If applicable, provide passings in the application that will

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receive broadband access because special construction costs have been budgeted in the VATI application. Describe the methodology used for determining which passings with special construction costs were budgeted in the application.

e. Provide passings with speeds of 25/3 Mbps or less in the project area.

Describe methodology for these projections. (up to 15 pts)

1. Indicate if RDOF blocks are in the VATI area; if so, provide a map, number of passings, and Census Block Group IDs. Label: Attachment 5 – RDOF Areas.

1. For wireless projects: Explain ownership of the wireless infrastructure; specify if the private co-applicant will own or lease the mast, tower, or structure.

Estimate the number of simultaneous subscribers served at the chosen speed in the area.

1. Describe the network design from internet points to end users, including existing and new components, scalability, capacity during peaks, and, for wireless, include a propagation map with legend. Label: Attachment 6 – Wireless Propagation Map.

10. Speeds: Describe post-project internet speeds, bandwidth type, technology, and include a map or schematic. List co-applicant’s tiered pricing for all speeds.

Include all speed offerings. DHCD may request verified speed tests during peak times to confirm speeds ≥100/20 Mbps. Describe testing methodologies. (up to 10 pts)

11. Explain how the project achieves or fits into universal broadband coverage, including remaining needs and plans. (up to 50 pts)

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Project Readiness (40 points)

12. Describe the current project development status, including planning,

Include preliminary engineering, easements/permits, MOU/MOA status, final design, detailed timeline with tasks, responsible parties, data collection, start/end dates, and discuss easements for crossings, federal lands, partnerships, and mobile home parks.

Applicants must include MOUs/MOAs (drafts allowed). Label Attachments: 7 – Timeline/Management Plan; 8 – MOU/MOA between Applicant/Co-Applicant. (up to 10 points)

13. Has the applicant or co-applicant received VATI grants? If yes, list grants and their status.

14. Matching funds: Complete the funding sources table showing cash match and in-kind resources from all partners involved in the project.

VATI funding cannot exceed 80% of total. In-kind includes management, rights of way, permit fee waivers, labor, etc. Minimum 20% match required; private sector must provide 10%. If private match <10%, provide financial details. Include prior expended funds via Attachment 11. Label: 9 – Funding Sources; 10 – Match Documentation; 11 – Prior Expended Funds.

15. Leverage: Describe leverage from applicant, co-applicant, and partners supporting the project. (Up to 10 points)

16. Communications Plan: Describe how you will inform the public and stakeholders about project progress and broadband adoption. a. Explain communication plans for stakeholders, including County leadership and residents. (Up to 10 points)

b. Explain how you plan to promote customer take rate, including marketing activities, outreach plan, and other actions to reach the identified serviceable units

within the project area. Provide the anticipated take rate and describe the basis for the estimate. (Up to 10 points)

c. Describe digital literacy efforts to ensure residents and businesses utilize broadband, listing partners like libraries or extension offices.

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17. Project Management: Identify key project managers and briefly describe their roles and responsibilities in table format.

Include applicant and co-applicant’s history with grants and broadband construction. Budget (135 points): Provide a detailed budget showing grant fund use, equipment, construction costs, and justification.

Provide itemized budget for equipment, construction, and justified expenses. For multiple service areas or towers, include separate budgets. Support costs with quotes or estimates. Label: 12 – Cost Derivation; 13 – Supporting Estimates. (Up to 10 points)

19. The cost benefit index comprises state cost per unit passed. Individual cost benefit scores are calculated and averaged together to create a point scale for a composite score. Provide the following: a. Total VATI funding request b. Number of serviceable units (Up to 125 points)

Commonwealth Priorities (50 points)

20. Additional points for projects aligning with Commonwealth priorities: a. Impactful businesses, anchors, or passings with broadband access; b. Unique partnerships like utilities, universities, agencies; c. Digital equity efforts for low/moderate income households, including ISP’s ACP participation; d. Co-applicant’s supply chain mitigation efforts for materials and labor delays.

e. Co-applicant’s efforts to mitigate costs/delays from make-ready and permits; f. Efforts to promote broadband adoption, including telehealth, smart farming, e-entrepreneurship, and distance learning.

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Additional Information

21. Please attach any letters of support from stakeholders. If the applicant is not a locality(s)

Include a support letter from the project locality if different from applicant.

Attachment 14 – Letters of Support.

22. Include any other information; limit to four additional attachments.

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List of Required Attachments, PDF Format Required

• All Attachments MUST be uploaded in PDF format

1. Map(s) of project area, including proposed infrastructure. ● Label Attachment: Attachment 1 – Project Area map
2. Documentation of Federal Funding (CAF/ACAM/USDA/RDOF, etc.…) in and/or

near proposed project area. ● Label Attachment: Attachment 2 – Documentation of Federal Funding Area

1. Documentation that proposed project area is unserved based on VATI criteria ● Label Attachment: Attachment 3 – Documentation Unserved Area VATI Criteria
2. Passings Form (Please use template provided) ● Label Attachment: Attachment 4 – Passings Form
3. Documentation of RDOF awarded area in VATI project area, if needed ● Label Attachment: Attachment 5 – RDOF Awarded Areas included in VATI Application
4. Propagation Map and Heat Map if Wireless Project ● Label Attachment: Attachment 6 – Propagation Map (Wireless Projects only)
5. Timeline/Project Management Plan ● Label Attachments: Attachment 7 – Timeline Project Management Plan
6. MOU/MOA between applicant/co-applicant (can be in draft form) ● Label Attachment: Attachment 8 – MOU.MOA between Applicant/Co-Applicant
7. Funding Sources Table

● Label Attachment: Attachment 9 – Funding Sources Table 10. Documentation for match funding ● Label Attachment: Attachment 10 – Documentation of Match Funding 11. Prior Expended Match Form ● Label Attachment: Attachment 11 – Prior Expended Match Form 12. Derivation of Cost (Project Budget) ● Label Attachment: Attachment 12 – Derivation of Costs 13. Documentation supporting project costs (e.g., vendor quotes) ● Label Attachment: Attachment 13 – Documentation of Supporting Cost Estimates 14. Letters of Support ● Label Attachment: Attachment 14 - Letters of Support 15. Two most recent Form 477 submitted to FCC. ● Label Attachment: Attachment 15 – Two most recent Form 477 submitted to the FCC or equivalent. 16. Point and Polygon shapefiles, in .zip file form, showing proposed passings and project area

● Label Attached. Zip Folder: Attachment 16 - Point and Polygon Shapefiles 17. For wireless applicants: shapefiles, in .zip file form, indicating RSSI projections in the application area ● Label Attached. Zip Folder: Attachment 17 – RSSI Projection Shapefiles 18. Label Additional Attachments as: ● Attachment 18 – XXXXXXX ● Attachment 19 – XXXXXXX ● Attachment 20 – XXXXXXX

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List of Required Attachments, Shapefiles

• All shapefiles MUST be functional

1. Point shapefiles showing each proposed passing as a point with attribute data of addresses.

1. Polygon shapefiles delineating the general challenged area(s).

1. For wireless providers: Shapefiles with heat maps showing RSSI in the area, considering terrain and vegetation.

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Virginia Telecommunication Initiative (VATI)

FOIA Policy Effective July 1, 2019 § 2.2-3705.6:

(32) Information submitted with a grant application to DHCD that reveals trade secrets, non-public financial data, or research info not publicly released, which could harm the applicant's competitive position. Exclusion applies only to grants administered by DHCD, the Department Director, or under § 36-139, Article 26, or the Virginia Telecommunication Initiative as authorized by the appropriations act.

To exclude submitted information from this chapter, the applicant must submit a written request to the Department:

a. Invoke exclusion when submitting data or materials for protection;

b. Specifically identify data or materials for protection; and

c. State reasons for protection.

The Department will decide if exclusion is necessary to protect trade secrets or confidential info and will issue a written determination of the protection scope.

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Virginia Telecommunication Initiative (VATI) Freedom of Information (FOIA) Policy

Entities requesting VATI FOIA exemption must submit a written request with documentation to vati@dhcd.virginia.gov. Exemptions do not apply to local government co-applicants. DHCD will decide within 10 days and, upon approval, documents must be sent to the same email. Exempt info will be securely stored and accessed only by VATI staff.

Grant Applications

DHCD will publish submitted VATI applications online. Public access is respected; FOIA-exemptions should only be requested when necessary. Applications via CAMS must include only public info. FOIA-exemption requests, citing § 2.2-3705.6, must be sent individually to vati@dhcd.virginia.gov, specifying the application.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

a. Invoking such exclusion upon submission of the data or other materials for which protection from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

c. Stating the reasons why protection is necessary.

The Department shall determine whether the requested exclusion from disclosure is necessary to protect the trade secrets or confidential proprietary information of the applicant. The Department shall make a written determination of the nature and scope of the protection to be afforded by it under this subdivision.

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Challenge Applications

Challengers are encouraged to contact applicants directly to discuss the contested area before submitting a challenge, as many issues can be resolved informally.

Challengers requesting FOIA exemption for challenge info must submit requests individually to vati@dhcd.virginia.gov. Incumbents with street-level data must submit challenges. Challengers can request exemption for multiple challenges separately. Challenged applicants will be notified and may request FOIA exemption for rebuttals per § 2.2-3705.6-3.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

a. Invoking such exclusion upon submission of the data or other materials for which protection from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

c. Stating the reasons why protection is necessary.

The Department shall determine whether the requested exclusion from disclosure is necessary to protect the trade secrets or confidential proprietary information of the applicant. The Department shall make a written determination of the nature and scope of the protection to be afforded by it under this subdivision.

Grant Monitoring

VATI-funded projects are monitored by DHCD. Entities requesting FOIA exemption for project success info, including take rate, must submit requests to vati@dhcd.virginia.gov.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

d. Invoking such exclusion upon submission of the data or other materials for which protection

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from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

c. State reasons for protection. The Department will decide if exclusion is necessary to protect trade secrets or confidential info and will issue a written determination of the scope.

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Definitions: Adjacent – parcels sharing a roadway, private or public, other than highways or expressways, as a boundary

Business – an entity providing goods or services to generate profit.

Residential home businesses can count if registered (BPOL, LLC, etc.).

Community Anchor includes schools, libraries, healthcare providers, public safety, colleges, and organizations supporting broadband access for vulnerable populations, including low-income, unemployed, and aged.

Digital Subscriber Line (DSL) – Technology delivering high-bandwidth info to homes and small businesses over copper telephone lines.

Eligible Project Costs – Expenses eligible for VATI grant reimbursement.

Fiber-to-the-Home (FTTH) – Network delivering internet over optical fiber directly to end-user homes, businesses, or other units.

Fixed Wireless – Wireless devices or systems in fixed locations.

Hybrid Fiber Coaxial (HFC) – A broadband network combining optical fiber and coaxial cable.

Last-Mile – Network components providing broadband to end-user premises or devices via an intermediate aggregation point (e.g., remote terminal, fiber node, wireless tower, or similar).

Leverage-Non-match cash or in-kind resources committed to a project that do not qualify as match (e.g., federally funded projects like CAFII, A-CAM) or are used as match (e.g., volunteer labor, engineering, design).

Middle-Mile – Network components providing broadband from centralized facilities (e.g., central office, cable head-end, wireless switching station) to an Internet point of presence.

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Non-Residential Passing – Places of worship, federal, state, local facilities, or other potential customers that are neither residences, businesses, nor community anchors (as defined above).

Passing – any structure that can receive service. Multi-unit structures may be counted as more

than 1 passing, provided individual connections and accounts are planned at that structure.

Peak Interval - Weekdays from 7:00 p.m. – 11:00 p.m. local time.

Point Shapefiles – shapefiles showing each proposed passing as a mapped point in the application or challenged area, with attribute data of each point's address.

Polygon Shapefiles - shapefiles delineating the general project area(s).

RSSI – Received Signal Strength Indicator, an estimated measure of power level a wireless client receives from an access point or router. See Appendix B for details.

Service Area – Geographic territory where an applicant proposes to provide service.

Serviceable Units – Properties eligible for broadband without extra special construction costs from owners/subscribers.

Special construction costs – One-time fees above standard service connection fees to provide broadband to a premise (e.g., connection drop fee beyond standard length or nonstandard equipment).

Street Level Data – Address ranges or specific addresses from an existing provider along with the existing number of customers within those ranges. No personal information on specific

customers will be requested.

Unserved – Properties with internet speeds below 100 Mbps download and 20 Mbps upload.

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Appendix A-Sample VATI Application Notice

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2024 Virginia Telecommunication Initiative

SAMPLE VATI APPLICATION NOTICE FORMAT

[Insert Date] Tamarah Holmes, Ph.D.

Director10 Office of Broadband Department of Housing and Community Development 600 East Main Street, Ste 300 Richmond, VA 23219

Dear Dr. Holmes: I am providing this VATI Application Notice t o notify the Virginia Department of Housing and Community Development of [insert name of unit of local government] and [private

provider (optional)]’s may submit an application for the FY2024 Virginia Telecommunication Initiative (VATI).

[Name of unit of local government, organization] and [private provider (optional)] intends to submit an application for [summary description of Project to be funded] within approximately [proposed Project Area(s)].

[Name] will be our main point of contact for the purposes of the application process, and can be reached at:

[Mailing Address] [Phone Number] [Email Address]

[Name of applicant government, organization and [ private provider (optional)] understands that this VATI Application Notice is required in order to submit an application for the 2024 Virginia Telecommunication Initiative and that this notice is not binding on the entity represented by the undersigned, Virginia Department of Housing and Community Development.

[Type the closing]

[signature] Type the sender’s name] [Type the sender’s title]

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Appendix B - Received Signal Strength Indicator

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Received Signal Strength Indicator

RSSI: Received Signal Strength Indicator is an estimated measure of power level that a wireless client device is receiving from an access point or router.

At larger distances, the signal becomes weaker and the wireless data rates become slower, leading to a lower overall data throughput. RSSI is measured in decibels from 0 to -120, the closer the value to 0 the stronger the signal will be, -55 is considered the best possible signal with measures of -90 and below considered unusable signal. Indoor best practices for mixed use networks see RSSI values of -75 to -80 and for session-based networks (Video Conferencing, Wi-Fi calling, etc.)

• 60 to -65

Below figure (1) shows an example of the RSSI distribution around a wireless site. Please note this is not an actual representation of wireless coverage maps and shows an unimpeded representation of wireless coverage.

Figure (1)

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Appendix C – Requirements of Speed Tests

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Requirements of Speed Tests

As outlined in VATI Program Guidelines and Criteria, DHCD reserves the right to request verified speed tests on all or portion(s) of a co-applicants’ or challenger’s existing network. Upon the request of DHCD, verified speed tests must be conducted at times of peak network usage and be distributed throughout a challenged area or service territory.

DHCD prefers speed tests be conducted at the access point (i.e., customer premise equipment, router, or modem) at the end-user location. Recognizing the feasibility constraints of conducting

speed tests at end-user locations, speed tests that are reported by the management application software at the network operations center will also be considered as valid.

The percent of required speed tests on a co-applicant’s or challenger’s existing network will depend on the size of the challenged area.

Requirements of Co-Applicants:

If DHCD requests co-applicants to submit verified speed tests distributed throughout a service territory at times of peak network usage from a co-applicant’s existing network. The number of speed tests should be no less than 10% of the passings included in the application area. In the event the co-applicant does not have enough customers to achieve the required 10% or greater speed tests based on the number of passings included in the application area, DHCD will consider field tests data to satisfy the 10% requirement. When submitting this information to DHCD, speed tests or field tests must be listed in a spreadsheet along with the address of the unit or location at which the speed test or field test was conducted. If these materials submitted are incomplete, DHCD will consider the application invalid.

Requirements of Challengers:

If challengers are required to submit verified speed tests as a part of their challenger or are requested by DHCD to submit speed test information, the number of required speed tests will be based upon the total number of challenged units. Please see the table below for the required number of speed tests.

Number of Less than 500 500 or Greater, but 1000 or Greater Challenged less than 1000 Locations within an Application Area Required Percentage 10% 7.5% 5%

of Speed Tests, based on Total Number of Challenged Units

In the event the challenger does not have enough customers to achieve the required percentage of speed tests, DHCD will consider field tests data to satisfy the requirement. When submitting this information to DHCD, speed tests and field tests must be listed in a spreadsheet along with the address of the unit or location at which the speed test or field test was conducted. If these materials submitted are incomplete, DHCD will consider the application invalid.

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[TABLE 37-1] Number of Challenged Locations within an Application Area | Less than 500 | 500-999 | 1000+ Required Percentage of Speed Tests, based on Total Challenged Units | 10% | 7.5% | 5%

[/TABLE]

• Page 1 ---

Virginia Telecommunication

Initiative (VATI)

2024 Program

Guidelines and Criteria

[TABLE 1-1] 2024 Program Guidelines and Criteria

[/TABLE]

• Page 2 ---

Table of Contents

Background 3 Summary of Changes to the 2024 VATI Guidelines and Criteria Program 4

Description 6 Definition of Broadband 6

Freedom of Information Act (FOIA) 6 Eligible Applicants 7 Selection Process 7 Infrastructure Investments and Jobs Act 7

Technical Assistance 8 Universal Coverage 8 Eligible Areas 8 Previously Funded Areas 9 Multiple Applications 11 Project Financing 11 VATI Notice of Application 12 Challenge Process 12 Implementation Deadline 14 Organizational and Management Capabilities 15 Application Due Date 16 Evaluation Criteria 17 Application Questions 19 List of Required Attachments, PDF Format Required 23 List of Required Attachments, Shapefiles 24 Freedom of Information (FOIA) Policy 27

Definitions 30 Appendix A-Sample VATI Application Notice 32

Appendix B - Received Signal Strength Indicator 34 Appendix C - Requirements of Speed Tests 36

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• Page 3 ---

Background

The digital divide – the lack of universal broadband coverage – is not only a technology issue; it is essential infrastructure for modern community and economic development. Broadband availability promotes sustainability and growth of communities by providing; access to health care, particularly through the introduction of telemedicine, which improves the local workforce,

provides increased educational opportunities through distance learning, and encourages an entrepreneurial economy where new and existing home-based and small businesses are able to compete globally.

Disconnected communities continue to struggle to retain existing businesses due to slow, sporadic, or limited broadband services. Since the vast majority of businesses rely on the internet to perform business functions such as online banking, e-commerce transactions (i.e., sales and online payment processing), market development (i.e. online ads, websites, bulk-email, etc.), customer service through online chat or emails and internal/external communication, broadband connectivity is vital to the performance of businesses of all sizes. Broadband is a necessity in the twenty-first century economy.

Additional guidance and questions regarding project development or about the VATI, guidelines and criteria should be directed to:

VATI email address vati@dhcd.virginia.gov

Tamarah Holmes, Ph.D. Director, Office of Broadband

Caroline Luxhoj, VATI Program Manager

Cole McAndrew, Broadband Policy Planner

Please refer questions regarding your application to: vati@dhcd.virginia.gov

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Summary of Changes to the 2024 VATI Guidelines and Criteria

Broadband Equity, Access, and Deployment (BEAD) Program Funding

The Department of Housing and Community Development’s Office of Broadband has been

designated by Governor Youngkin to serve as the recipient of, and administering agent for, any BEAD Program funding for the Commonwealth of Virginia. Both BEAD funding utilized for broadband deployment and state general funds will be regarded as under the umbrella of the Virginia Telecommunication Initiative; however, the Office of Broadband will invite proposals for funding under the BEAD program separate of those proposals for state general funds. Proposals received for BEAD funding will be scored, governed, and administered via BEAD and subsequent federal guidance. Proposals received for state general funding will be scored, governed, and

administered via FY24 VATI Guidelines and Criteria.

Eligible applicants to each program are encouraged to apply for both funding sources, with

consideration of the eligibility of areas in the application. There is no prohibition on proposals receiving funds from both programs, so long as a project is otherwise eligible and there is no duplication of funding.. DHCD reserves the right to make administrative determinations and recommendations on VATI awards of state general funds based on capacity of the participating internet service provider to accommodate federal requirements of BEAD funds, the funding feasibility of the technology type under BEAD, as well as funding eligibility of areas for state general funding when compared to BEAD, among other factors. DHCD reserves the right to

partially award any application and may request applicants and internet service providers provide information for a subset of an area within their original application area during the application process for state general funding.

Applicants, including internet service providers are strongly encouraged to contact DHCD prior to submitting applications for BEAD or state general funds to discuss alignment, as well as incongruence, between each program. (Page 6)

Connect America Fund Phase II

Announced in 2018, the Federal Communications Commission’s (FCC) Connect America Fund Phase II (CAF-II) Auction obligated over $108 million in funding to extend broadband

infrastructure access to over 39,800 locations across the Commonwealth. The performance requirements of this program are staggered with a construction deadline of 6 years, beginning after internet service provider grantees finalize documentation with the FCC. While many examples across the Commonwealth exist of timely construction of these areas under this program, a limited number of CAF-II awarded areas have yet to be built out.

To account for these areas which have not yet been constructed, and thus ensuring these locations

have a solution for broadband access regardless of the outcome of federal programs, passings in 4 | Page

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CAF-II awarded areas which have not yet been built out may be included in a VATI application,

provided the CAF-II awardee and VATI co-applicant are not the same entity and the project timeline would provide broadband access ahead of the CAF-II construction deadline.

The Department of Housing and Community Development may provisionally award these CAF-II funded areas. Awards in these areas will be contingent to the CAF-II awarded internet service provider’s de-obligation of these areas without penalty by the FCC.

Project Financing

Elimination of the requirement that an applicant and co-applicant had to be unsuccessful in a previous round of VATI to count prior-expended match toward their application.

Commonwealth Priorities

Additional Response Required Under Commonwealth Priorities (Page 20) a. The co-applicant’s efforts to mitigate costs and delays that may be associated with make-ready and other permitting requirements anticipated for network deployment.

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Program Description

Administered by the Virginia Department of Housing and Community Development (DHCD), the Virginia Telecommunication Initiative (VATI) enhances the sustainability and growth of communities throughout the Commonwealth by preparing those communities to build, utilize, and

capitalize on telecommunications infrastructure. Consistent with the enabling budget language, DHCD will award funding to eligible applicants to provide last-mile services to unserved areas of the Commonwealth. DHCD reserves the right to award any amount to eligible grantees, depending entirely on the quality and quantity of applications received.

The primary objective of the VATI grant making process is to provide financial assistance to supplement construction costs by private sector broadband service providers, in partnership with

local units of government, to extend service to areas that presently are unserved by any broadband provider.

Definition of Broadband

Broadband is the transmission of wide bandwidth data over a high-speed internet connection.

For the purposes of VATI and other programs dependent on the VATI definition of broadband, the speeds at which internet service is considered broadband, is access to speeds at or above 100

megabits per second (Mbps) download and 20 Mbps upload.

Freedom of Information Act (FOIA)

Pursuant to Section 2.2-3705.6-32 of the Code of Virginia, DHCD has the legal authority with the following information contained in a public record and is exempt from the mandatory disclosure

provisions of the Virginia Freedom of Information Act (FOIA): “information related to a grant application, or accompanying a grant application, submitted to the Department of Housing and Community Development that would (i) reveal (a) trade secrets, (b) financial information of a grant applicant that is not a public body, including balance sheets and financial statements, that are not generally available to the public through regulatory disclosure or otherwise, or (c) research-

related information produced or collected by the applicant in the conduct of or as a result of study or research on medical, rehabilitative, scientific, technical, technological, or scholarly issues, when such information has not been publicly released, published, copyrighted, or patented, and (ii) be harmful to the competitive position of the applicant.” Applicants wishing to receive FOIA

exemption must submit a written request to DHCD and follow the FOIA policy, found on page 21. Note: Point and polygon shapefiles submitted with VATI applications are subject to the Freedom of Information Act and will not be provided FOIA exemption. RSSI measures in the project area(s) are eligible for Freedom of Information Act exemption.

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Eligible Applicants

Applications must be submitted by a unit of government (Towns, Cities, Counties, Economic Development Authorities/Industrial Development Authorities, Planning District Commissions, School Divisions, etc.) with a private sector internet service provider as a co-applicant. Eligible projects must be owned and operated by the private sector co-applicant. Publicly owned networks are eligible for the program when partnered with a private sector co-applicant, so long as the private sector applicant is serving as the customer-facing internet service provider.

Notwithstanding program requirements that applications include a private-sector internet service provider as the co-applicant, public broadband authorities may apply directly for VATI funds without investment from the private sector. Such awards, in sum, shall not exceed 10 percent of total available state general funds in FY2024. Applications submitted without a private sector co-applicant will be evaluated alongside other applications. DHCD reserves the right to update this guidance upon final adoption of the state budget by the General Assembly and Governor.

Selection Process

Awardees will be selected through a competitive application process. Application questions will be

focused on the applicant’s broadband needs as well as information related to ready-to-construct project(s) needing financial assistance to supplement construction costs. The applicant must demonstrate a readiness to proceed with an awarded project in a timely manner by the required deadline and must provide access to broadband speeds at or above 100 Megabits per second (Mbps) download and 20 Megabits (Mbps) upload. DHCD reserves the right to revoke an award due to a material misrepresentation.

Broadband Equity, Access, and Deployment (BEAD) Program Funding

The Department of Housing and Community Development’s Office of Broadband has been designated by Governor Youngkin to serve as the recipient of, and administering agent for, any BEAD Program funding for the Commonwealth of Virginia. Both BEAD funding utilized for

broadband deployment and state general funds will be regarded as under the umbrella of the Virginia Telecommunication Initiative; however, the Office of Broadband will invite proposals for funding under the BEAD program separate of those proposals for state general funds. Proposals received for BEAD funding will be scored, governed, and administered via BEAD and subsequent federal guidance. Proposals received for state general funding will be scored, governed, and administered via FY24 VATI Guidelines and Criteria.

Eligible applicants to each program are encouraged to apply for both funding sources, with consideration of the eligibility of areas in the application. There is no prohibition on proposals receiving funds from both programs, so long as a project is otherwise eligible and there is no

duplication of funding. DHCD reserves the right to make administrative determinations and recommendations on VATI awards of state general funds based on capacity of the participating internet service provider to accommodate federal requirements of BEAD funds, the funding feasibility of the technology type under BEAD, as well as funding eligibility of areas for state general funding when compared to BEAD, among other factors. DHCD reserves the right to partially award any application and may request applicants and internet service providers provide 7 | Page

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information for a subset of an area within their original application area during the application process for state general funding.

Applicants, including internet service providers,are strongly encouraged to contact DHCD prior to submitting applications for BEAD or state general funds to discuss alignment, as well as incongruence, between each program.

Technical Assistance

DHCD staff is available to provide technical assistance on the development of an application and during the challenge process to units of local government, internet service providers, grant writers,

consultants, and all other VATI stakeholders. Please reach out to DHCD staff and consult the broadband toolkit available at www.commonwealthconnect.virginia.gov/broadband-toolkit prior to engaging a private consultant. DHCD staff strongly recommends engagement of technical assistance throughout project development.

Universal Coverage

DHCD encourages applicants to ensure all projects either achieve or are part of a plan to achieve universal broadband for the locality or region. Localities can find resources for developing a universal broadband plan on the Commonwealth Connect website at www.commonwealthconnect.virginia.gov/broadband-toolkit. DHCD recognizes that due to the nature of wireless projects having an inherent potential of overlap it is strongly encouraged that

applicants contact DHCD staff for assistance. Applicants are discouraged from submitting projects that focus on pockets of density while not including nearby unserved, less dense areas. This tactic, also known as cherry picking, hurts the economics of serving the remaining areas in your community and will ultimately make it more difficult and costly to get all Virginians access to broadband coverage.

Eligible Areas

DHCD will award funding to applicants to provide last-mile services, including middle-mile

networks, equipment, or other investments required to deliver last-mile service to unserved areas of the Commonwealth. Unserved areas are defined as having broadband speeds below 100 Megabits per second (Mbps) download and 20 Megabits (Mbps) upload. Areas lacking 25 Megabits per second download and 3 Megabits per second upload speeds will be given significant

priority in application scoring.

● For a wireline project, a proposed project area is considered eligible if 20 percent or fewer of serviceable units have access to service with no special construction costs from any provider as of the date of the application. ● For a wireless project, a proposed area is considered eligible if 25 percent or fewer of serviceable units have access to service with no special construction costs from any provider as of the date of the application. Passings with RSSI below -90dbm are not eligible to be included in a VATI application. 8 | Page

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Applicants are strongly encouraged to include passings in the proposed project areas that have special construction costs (see definitions for more detail) for low to moderate income residents, as these locations will become increasingly more difficult to connect outside of the VATI application process. These passings include properties where the location has an extended setback from the public right of way beyond the maximum distance between a network access point and the home or business allowed by the co-applicant.

In some cases, applicants may seek to include locations that do not have access to broadband because of special construction costs associated with extending broadband infrastructure to a location. In instances where concentrated pockets of locations do not have access to broadband, due to special construction costs, VATI is better designed for extending broadband infrastructure to these locations. The Line Extension Customer Assistance Program (LECAP) is intended to cover costs to extend service to scattered locations across the locality, not address long drop issues in concentrated pockets of a locality. For more information, please contact DHCD staff to discuss the scope of projects prior to application.

DHCD discourages the sole use of broadband availability maps when determining unserved areas to be included in an application. Mapping efforts, regardless of the level of detail should not replace further evaluation of broadband availability (i.e., fiber, cable, vertical assets). For best practices regarding drawing a project area, please contact DHCD staff.

Previously Funded Areas

Applicants must do their due diligence to determine if their proposed VATI project area has in whole or in part been awarded state or federal broadband funds. These programs include, but are not limited to, the Virginia Telecommunication Initiative, Tobacco Region Revitalization Commission Awards, Connect America Funds II (CAFII), United States Department of Agriculture (USDA) Reconnect, USDA Community Connect, Alternative Connect America Cost Model (ACAM), and the Rural Digital Opportunity Fund (RDOF).

Federally and state funded areas with existing agreements to build service to, or are currently served with, access to internet at speeds less than 100/20 Mbps are eligible for funding under the VATI program. Federally funded areas with service obligations at or over 100/20 Mbps will not be considered for funds managed and awarded through the VATI grant making process.

In some cases, recipients of federal or state funds were awarded funding to provide service at less than 100/20 Mbps but provide service over this threshold. In instances where the network infrastructure in the previously funded area under this scenario has been constructed, an internet service provider must submit a challenge on the basis of actual serviceability in the previously funded area. In instances where network infrastructure has not been constructed in the previously funded area, a challenger may provide speed test data from existing service territories in Virginia to be considered as that provider’s capability to provide service over the 100/20 Mbps threshold.

Please see Appendix C for additional guidance on the number of speed tests required and acceptable practices for conducting speed tests. In instances where possible, DHCD encourages local governments to explore partnerships with internet service providers which received the previous state or federal award to upgrade coverage in these areas; however, no scoring preference will be assigned to local governments partnering with the state or federally awarded internet service provider during application evaluation.

In the event the VATI co-applicant has been awarded federal broadband funds, they cannot use those funds as matching funds. However, they are encouraged to leverage their federal award and apply for VATI funding to extend service to areas beyond those that were awarded federal funds 9 | Page

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or to accelerate construction of federal awards made through RDOF.

Connect America Fund Phase II

Announced in 2018, the Federal Communications Commission’s (FCC) Connect America Fund Phase II (CAF-II) Auction obligated over $108 million in funding to extend broadband infrastructure access to over 39,800 locations across the Commonwealth. The performance requirements of this program are staggered with a construction deadline of 6 years, beginning after

internet service provider grantees finalize documentation with the FCC. While many examples across the Commonwealth exist of timely construction of these areas under this program, a limited number of CAF-II awarded areas have yet to be built out.

To account for these areas which have not yet been constructed, and thus ensuring these locations have a solution for broadband access regardless of the outcome of federal programs, passings in CAF-II awarded areas which have not yet been built out may be included in a VATI application,

provided the CAF-II awardee and VATI co-applicant are not the same entity and the project timeline would provide broadband access ahead of the CAF-II construction deadline.

The Department of Housing and Community Development may provisionally award these CAF-II funded areas. Awards in these areas will be contingent to the CAF-II awarded internet service provider’s de-obligation of these areas without penalty by the FCC.

Rural Digital Opportunity Fund

On December 7, 2021, the Federal Communications Commission (FCC) announced preliminary results of the Phase 1 RDOF auction. To a far greater extent than previous FCC auctions, RDOF delivered lower than anticipated level of funding to internet service providers, presenting challenges in their ability to deliver services. To accelerate broadband access in RDOF awarded areas, passings

in those areas may be included in VATI application to cover a portion of the infrastructure needed to reach RDOF awarded areas. All RDOF passings included in a VATI application that is awarded funding must be provided access to broadband service within the VATI contractual period. RDOF passings may not exceed VATI passings in the application. DHCD reserves the right to waive this requirement on a case-by-case basis in instances where this may be impractical in an application.

For example, in some localities RDOF locations may outnumber remaining unserved passings that

are eligible for VATI. The internet service provider co-applicant must provide a detailed explanation if RDOF passings exceed VATI passings in the application.

Combining RDOF with VATI

Due to the delay in the FCC issuing the Phase I RDOF final long-form results, areas preliminarily awarded RDOF, regardless of bidder, are eligible to be included in a VATI application. RDOF

awardees who are not the VATI co-applicant may challenge an application that includes all, or portions of their final RDOF awarded area. If the challenge is determined to be credible, the applicant will be required to remove the area(s) that overlap from their application. The challenging RDOF awardee must commit to providing broadband access in the challenge area(s) within 3 years 10 | Page

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of the announcement of FY 2024 VATI awards and will be required to enter into a Memorandum of Understanding (MOU) with DHCD and the VATI applicant, or locality in which the RDOF award is contained (for regional applications), committing to construct the removed area(s) by the time the contract is executed for the awarded project. Please note; if DHCD determines that a

challenge is credible on the basis of a final RDOF award and the RDOF awardee has committed to constructing the challenges area and later defaults, they are prohibited from submitting future VATI applications for that challenged area, unless a unit of local government applicant formally expresses intent in partnering with the defaultee on a future VATI application(s) in that area.

RDOF areas, unless those areas are challenged and an MOU has been entered into by the locality and RDOF awardee, are considered unserved and fully eligible for VATI funding. If RDOF areas

awarded to an internet service provider other than the VATI applicant are included in a VATI application, but not challenged by the RDOF awardee, those will be considered as unserved and scored as such.

Leveraging RDOF in achieving Universal Coverage

If RDOF areas are included in a VATI application and that application achieves universal coverage

in the county, or counties, each RDOF passing included in that VATI application will be awarded ½ of the scoring value of a VATI passing. If multiple applications are submitted with

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different co-applicants and those applications cumulatively reach universal coverage, RDOF locations included in those applications will be awarded at ½ the scoring value of a VATI passing.

If RDOF is included in a VATI application and does not achieve universal coverage in a county, or counties but is part of a universal plan, each passing in the application will be awarded ¼ of the scoring value of one VATI passing. RDOF may not be included in a VATI application if it does not achieve universal coverage or is not part of a universal plan. RDOF passing valuations also apply to businesses and community anchor institutions in RDOF awarded areas in the VATI application.

To account for the potential of supplemental action by the Federal Communications Commission in regard to the results of Phase I RDOF auction, DHCD reserves the right to update the guidelines accordingly in response to federal rules changes.

Multiple Applications

Units of local government may submit multiple applications with different service providers and may include project areas that cross-jurisdictional boundaries. No more than one last-mile internet

service provider may be included in an application. Units of local government must submit an application with each last mile internet service provider. Service providers may submit an application with more than one unit of local government. Multiple applications that reach universal coverage in a county or region when combined will be awarded maximum points for universality when scored. An applicant may include non-contiguous service areas in a single application. If designating more than one county or city in a single application, each county or city must be clearly delineated, and the required data and budget information must be provided for each county and

city.

Project Financing

VATI funding shall not exceed 80 percent of the total project cost. Applicants should note that the program is competitive however, and that those projects that bring greater match to the application are more likely to receive higher evaluations scores.

Consistent with VATI’s enabling budget language; the private co-applicant must contribute a minimum of 10% cash match to the total project cost. If the private co-applicant match is below 10% of total project cost, applicants must provide financial details in their applications

demonstrating appropriate private investment in relation to the density and scope of the project.

Local Government expenditures incurred one year prior to the application open date, are eligible to be included in the application as match funds. Incurred expenses must be related to the proposed VATI project and meet VATI criteria. Expenditures incurred by internet service providers after May 11, 2023 are also eligible to be included in the application as match funds. Incurred expenses must also be directly related to the proposed VATI project and meet VATI criteria. DHCD staff

reserves the right to make administrative determinations on the validity of matching funds and accept a proportion of the funds when necessary. Expenses

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incurred by local governments sought to be considered as matching funds must be included and described in the Prior Expended Match Form as an application attachment.

Demonstrated local government support through contribution of Coronavirus Local Fiscal Recovery Funds (LFRF) delivered to local governments through the American Rescue Plan Act is

strongly encouraged. LFRF contributed to a VATI application are considered match funds.

Pending state allocation of Infrastructure Investments and Jobs Act funds, DHCD reserves the right to determine the source of funds through which awards are made. Nonstate general fund awards

such as this can fund VATI applications and are subject to the rules of the funding source.

VATI Notice of Application

All applicants are required to issue a VATI Notice of Application detailing their intent to apply for VATI funding no later than October 19, 2023. Applicants must submit a copy of the VATI Notice

of Application to DHCD at: vati@dhcd.virginia.gov. The sample notice is located in Appendix A.

VATI Notice of Applications will be posted on DHCD’s VATI webpage no later than 5 business days after the submission deadline.

Application Due Date

Applications are to be submitted by 11:59 p.m. on December 19, 2023. Please note that DHCD Offices close at 5:00 p.m. Therefore, staff will not be available to provide CAMS technical

assistance after 5:00 p.m.

Challenge Process

Prospective challengers are strongly encouraged to contact applicants directly and discuss the contested project area before submitting a challenge as project areas can often be re-scoped to

remove overlap. Evidence of serviceability must be demonstrated by showing a reasonable number of customers within the area of claimed serviceable units.

Planned service to a proposed project area is eligible for the purpose of a challenge if state or federal funds have been awarded and the provider has committed to providing service to the areas using these state or federal funds. Federally and state funded areas with existing agreements to build service to, or are currently served with, access to internet at speeds less than 100/20 Mbps are

eligible for funding under the VATI program. Federally funded areas with service obligations at or over 100/20 Mbps will not be considered for funds managed and awarded through the VATI grant making process, unless otherwise outlined in these guidelines and criteria.

In some cases, recipients of federal or state funds were awarded funding to provide service at less than 100/20 Mbps but provide service over this threshold. In instances where the network infrastructure in the previously funded areas under this scenario has been constructed, an internet service provider must submit a challenge on the basis of actual serviceability in the previously funded area. In instances where network infrastructure has not been constructed in the previously funded area, a challenger must provide speed test data from existing service territories in Virginia to be

considered as that provider’s capability to provide service over the 100/20 Mbps threshold. Please 13 | Page

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see Appendix C for additional guidance on the number of speed tests required and acceptable practices for conducting speed tests. DHCD reserves the right to request verified speed tests at times of peak network usage and street level data of customers receiving service within the proposed project area in federally awarded areas to ensure serviceability.

Areas adjacent to state or federally funded areas may be eligible for a challenge if the challenger demonstrates existing awards will cover the adjacent area. If an incumbent provider serves one side of a roadway, but will not connect the other side, that unserved side of the road is eligible for VATI funding. In these instances, the applicant must prove the incumbent provider will not connect the unserved side of the roadway. The challenger must commit to serving the adjacent areas at speeds equal to or greater than the VATI minimum deployment speed.

DHCD will post electronic copies of all submitted applications to the agency website on or by January 4, 2024. Providers wishing to submit a challenge must provide the information required in this section no later than February 8, 2024. Applicants will be notified if their proposed project area is being challenged by February 15, 2024 and will have 15 business days from notification of a challenge to provide rebuttal information to DHCD.

Providers wishing to submit challenges on multiple applications must submit a separate challenge

for each application. Challenges can be made to portions of a proposed project area without invalidating the entire application. DHCD reserves the right to invalidate a portion(s) of a proposed project area, aggregate challenges by different providers to determine the percentage of serviceable units served in a proposed project area and invalidate insufficient challenges.

Challengers, individually or collectively, must demonstrate that more than 20% for wireline projects, or 25% for wireless projects, of serviceable units in the project area have access to speeds

above 100/20 Mbps as of the date of the application or that the application is ineligible as a result of committed state or federal funding subject to the conditions described above.

DHCD must receive all of the information detailed below or the challenge will be deemed incomplete and invalid. Challengers must provide:

1. A signed and notarized affidavit affirming the challenge and attached information is true.
2. Current Federal Communications Commission (FCC) Form 477 or equivalent.
3. Minimum/maximum speeds available in the proposed project area.
4. Number of serviceable units within the proposed project area and provide the speeds those serviceable units are able to receive.
5. Street level data of customers receiving service within the proposed project area.
6. Point shapefiles that show each proposed passing in the challenged area, designated by a

singular mapped point, in the challenged area containing attribute data showing the addresses of each point; and Polygon shapefiles delineating the general challenged area(s). (Note: These files must be provided in .zip file form)

1. For wireless providers: Heat maps indicating received signal strength indicator (RSSI) in the challenged area, accounting for terrain and peak vegetation (Note: These files must be provided in .zip file form)
2. Wireless providers must also note if the bandwidth is shared or dedicated in

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the challenged area.

1. Using the project area map submitted by the applicant, create a map indicating where the

challenger’s serviceable units are located in the proposed project area. Challengers are encouraged to submit additional maps and information if necessary. 10. If challenging due to planned state or federal funding, documentation detailing commitment to provide service in or adjacent to the proposed project area. 11. If the challenger has not submitted service territory data meeting the

requirements of the Internet Service Provider Service Territory Data Submission Guidelines, the challenger must submit service territory data for the challenge to be considered. 12. If challenging an application on the basis of variable speed technologies (i.e., DSL, Fixed Wireless, etc.), challengers are required to submit verified speed tests at times of peak network usage on all or portion(s) of the challenged area.

Please see Appendix C for additional guidance on the number of speed tests

required and acceptable practices for conducting speed tests.

DHCD strongly encourages challengers to contact DHCD staff for technical assistance regarding the shapefile requirements prior to challenge submittal. DHCD encourages challengers to use the VATI applicant’s point shapefiles, as posted on the Open Data Portal to “cut out” or “clip” addresses being challenged to create the point shapefiles to be submitted under the challenge. This practice ensures accurate representation of challenged areas within the VATI application area and

allows the challenged locations shapefiles to be exact matches geographically to the VATI application shapefiles submitted.

DHCD will review all applicable challenge and rebuttal information to determine if a challenge is credible. DHCD reserves the right to request verified speed tests at times of peak network usage on all or portion(s) of the challenged area. If verified speed tests are requested by DHCD, the

challenger will have 10 days to respond with documentation requested by DHCD. DHCD reserves the right to re-scope any credibly challenged VATI application and fund the remaining portion(s) of the application. Please see Appendix C for additional guidance on the number of speed tests required and acceptable practices for conducting speed tests. DHCD shall notify the applicant and challenger in writing if a challenge is credible no later than April 12, 2024. Upon notification of challenge determination, applicants will have 10 days to submit rescope materials, which include: an updated map of the application area reflecting removal of the challenged area(s), point and

polygon shapefiles of the updated application area, the Funding Sources Table, the VATI Passings Form, the RDOF Passings Form (if applicable), and the Derivation of Costs.

Any proposals to modify a previously awarded project are subject to the VATI challenge process adopted in the most recent guidelines if a new project area has been added.

Implementation Deadline

Applicants must demonstrate that projects will be completed within 18 months. The project timeline begins with the contract execution between the applicant and DHCD. DHCD will consider longer project timelines for larger project areas if applicants can sufficiently detail the reasoning for an 15 | Page

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extended timeline in their application. Applicants are encouraged to phase larger scale projects, and DHCD reserves the right to fund only a phase(s) of a proposed project.

Extensions may be considered for awarded projects that encounter delays due to circumstances

outside of the applicants’ control. Contact DHCD staff for all questions regarding project scope.

Organizational and Management Capabilities

To participate in VATI, applicants and co-applicants must demonstrate suitable organizational and management capabilities. To determine whether applicants meet this criterion, applicants and private sector partner(s), must submit the following documents and/or attest to each of the

following:

1. Documentation that proposed project area is unserved based on VATI criteria.
2. Private co-applicant must provide proof that they have filed an FCC Form 477 by the two

most recently submitted forms prior to submission of application. If the private co-applicant has not submitted an FCC Form 477 in previous years, the co-applicant must provide reasoning for not submitting, business background, number of customers, overview of assets, or equivalent information.

1. Point shapefiles are shapefiles that show each proposed passing in the application area, designated by a singular mapped point, in the project area containing attribute data showing the addresses of each point. Polygon shapefiles delineating the general project

area(s). Polygon shapefiles delineating the general project area(s). (Note: These files must be provided in .zip file form)

1. For wireless providers: Heat maps indicating projected received signal strength indicator (RSSI) in the application area accounting for terrain and peak vegetation (Note: These files must be provided in .zip file form)
2. Projects must be fully financed through a combination of the total requested funds,

committed matching funds from the applicants, and in-kind resources.

1. Private co-applicants must document current assets (i.e., total amount of available cash and equivalents, callable capital, in an amount no less than the proposed committed funding or a commitment letter for financing) in the amount of match funds committed for the project at the time of application. Per VATI’s enabling budget language, the private co-applicant must contribute an appropriate level of match to the total project cost.

1. Applicants must be in good standing in performance of any and all existing Commonwealth of Virginia contracts and in compliance with all federal, state, and local laws.
2. If the co-applicant has not submitted service territory data meeting the requirements of the Internet Service Provider Service Territory Data Submission Guidelines, the co-applicant must submit service territory data for the application to be considered.

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DHCD reserves the right to request verified speed tests distributed throughout a service territory at times of peak network usage from a co-applicant’s existing network to verify a co-applicant’s capability to provide broadband service at speeds at or above 100/20 Mbps. Please see Appendix C

for additional guidance on the number of speed tests required and acceptable practices for conducting speed tests.

Funds managed and awarded through the VATI grant making process may be requested to cover administrative costs please see the table below regarding allowable administrative expenses.

Allowable Request for Total Award Administration

<$1 million $50,000 >$1 million, <$5 million $100,000

>$5 million, <$10 million $200,000 >$10 million $300,000 .

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[TABLE 17-1] Total Award | Allowable Request for Administration <$1 million | $50,000 >$1 million, <$5 million | $100,000 >$5 million, <$10 million | $200,000 >$10 million | $300,000

[/TABLE]

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Evaluation Criteria

Project Description and Need (Maximum of 75 points) Describe the fundamentals of the project, including: ● Overview of the project area and how it was determined ● Internet speeds to be offered ● Network design ● How the project achieves universal broadband coverage in a locality, or how a project fits into a larger plan for universal broadband coverage. Note: Applicants will only

achieve maximum scoring in this section if the application reaches universal coverage in the county or counties included in the application.

Project Readiness (Maximum of 40 points) Describe the capacity to successfully implement the project, including: ● Additional leverage to improve the project ● Marketing activities, including digital literacy efforts, to ensure a sufficient take rate

● Description of the project management plan, including key contacts, projected timeline, and history of managing similar projects/grants

Project Budget and Cost-Appropriateness (Maximum of 135 points) Describe the project budget, including: ● Detailed project budget, including derivation of costs and documentation of cost estimates, delineated by each service area

● Information to calculate the Cost Benefit Index score ● Number of serviceable units passed and the breakdown of those passings ● Breakdown of matching funds and in-kind resources

Commonwealth Priorities (Maximum of 50 points) Describe how the project would reflect priorities of the Commonwealth, including: ● Passings of significant impact

● Unique partnerships involved in the project ● Digital equity efforts ● Capacity for scalability

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Application Questions

Project Description and Need (75 points)

1. Describe why and how the project area(s) was selected. Describe the proposed geographic area including specific boundaries of the project area (e.g., street names, local and regional boundaries, etc.). Attach a copy of the map of your project area(s). Label map: Attachment 1 – Project Area Map.

1. List existing providers in the proposed project area and the speeds offered. Describe your outreach efforts to identify existing providers and how this information was compiled

with source(s).

1. Describe if any areas near the project have received funding from federal grant programs, including but not limited to Connect America Funds II (CAF II), ACAM, ReConnect, Community Connect, and Rural Digital Opportunity Funds (RDOF). If there have been federal funds awarded near the project area(s), provide a map showing these areas, verifying the proposed project area does not conflict with these areas. Label Map: Attachment 2 – Documentation on Federal Funding Area.

1. Overlap: To be eligible for VATI, applicants must demonstrate that the proposed project area(s) is unserved. An unserved area is defined as an area with speeds below 100/20 Mbps and with less than 25% service overlap within the project area for wireless projects and 20% for wireline projects. Describe any anticipated service overlap with current providers within the project area. Provide a detailed explanation as to how you determined the percentage overlap. Label Attachment: Attachment 3 – Documentation Unserved

Area VATI Criteria.

1. Total Passings: Provide the number of total serviceable units in the project area.

Applicants are encouraged to prioritize areas lacking 25 Megabits per second download and 3 Megabits per second upload speeds, as they will receive priority in application scoring. For projects with more than one service area, each service area must have delineated passing information. Label Attachment: Attachment 4 – Passings Form.

a. Of the total number of VATI passings, provide the number of residential, business, non-residential, and community anchors in the proposed project area.

b. If applicable, of the total number of RDOF passings, provide the number of residential, business, non-residential, and community anchors in the proposed project area. c. If applicable, provide the number of passings that will require special construction costs, defined as a one-time fee above normal service connection fees required to provide broadband access to a premise. Describe the methodology used for these projections. d. If applicable, provide the number of passings included in the application that will

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receive broadband access because special construction costs have been budgeted in the VATI application. Describe the methodology used for determining which passings with special construction costs were budgeted in the application.

e. Provide the number of passings in the project area that have 25/3 Mbps or less.

Describe the methodology used for these projections. (Up to 15 points)

1. Describe if any blocks awarded in Rural Digital Opportunity Fund (RDOF) are included in the VATI application area. If RDOF areas are included in the VATI application, provide a map of these areas and include information on number of passings in RDOF awarded areas within the VATI application area, and Census Block Group ID number for each block group in the project area. Label Attachment: Attachment 5 – RDOF Awarded Areas Form in VATI Area

1. For wireless projects only: Please explain the ownership of the proposed wireless infrastructure. Please describe if the private co-applicant will own or lease the radio mast, tower, or other vertical structure onto which the wireless infrastructure will be installed.

Also, provide an estimate of the number of simultaneous subscribers that can be served in an area at the chosen speed.

1. Network Design: Provide a description of the network system design used to deliver broadband service from the network’s primary internet point(s) of presence to end users, including the network components that already exist and the ones that would be added by the proposed project. Provide a detailed explanation of how this information was determined with sources. Provide information on how capacity for scalability, or expansion, of how the network can adapt to future needs. If using a technology with shared bandwidth, describe how the equipment will handle capacity during peak intervals. For wireless projects, provide a propagation map for the proposed project area with a clearly defined legend for scale of map. Label Map: Attachment 6 – Propagation Map Wireless Project.

10. Speeds: Describe the internet service offerings, including download and upload speeds, to be provided after completion of the proposed project. Detail whether that speed is based on dedicated or shared bandwidth and detail the technology that will be used. This description can be illustrated by a map or schematic diagram, as appropriate. List the private co-applicant’s tiered price structure for all speed offerings in the proposed project

area, including all speed offerings. Please note, DHCD reserves the right to request verified speed tests distributed throughout a service area at times of peak network usage from a co-applicant’s existing network to verify a co-applicant’s capability to provide broadband service at speeds at or above 100/20 Mbps. Describe the co-applicant’s methodologies for conducting speed tests. (Up to 10 points)

11. Explain how the proposed project achieves universal broadband coverage for the locality or fits into a larger plan to achieve universal broadband coverage for the locality. If applicable, explain the remaining areas of need in the locality and a brief description of the plan to achieve universal broadband coverage. (Up to 50 points)

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Project Readiness (40 points)

12. Describe the current state of project development, including but not limited to planning,

preliminary engineering, identifying easements/permits, status of MOU or MOA, and final design. Prepare a detailed project timeline or construction schedule, identifying specific tasks, staff, contractor(s) responsible, collection of data, etc., and estimated start and completion dates. Applicants are encouraged to extensively discuss, where applicable, easements relating to railroad crossings, federally owned lands and parks, partnerships with the Virginia Department of Transportation, and mobile home parks.

Applicants must include Memorandums of Understanding (MOUs)or Memorandums of Agreement (MOAs) between applicants (drafts are allowable). Label Attachments: Attachment 7 – Timeline/Project Management Plan; Attachment 8 – MOU/MOA between Applicant/Co-Applicant; (up to 10 points)

13. Has the applicant or co-applicant received any VATI grants? If so, provide a list of these grants, with a detailed summary of the status of each.

14. Matching funds: Complete the funding sources table indicating the cash match and in- kind resources from the applicant, co-applicant, and any other partners investing in the proposed

project (VATI funding cannot exceed 80 percent of total project cost). In-kind resources include, but are not limited to grant management, acquisition of rights of way or easements, waiving permit fees, force account labor, etc. Please note that a minimum 20% match is required to be eligible for VATI, the private sector provider must provide 10% of the required match. If the private co-applicant cash match is below 10% of total project cost, applicants must provide financial details demonstrating appropriate private investment. If applicants and co-applicants are seeking to include prior expended funds as matching funds, Attachment 11 must be completed. Label Attachments: Attachment 9 - Funding Sources Table; Attachment 10 –Documentation of Match Funding; Attachment 11 – Prior Expended Match Form

15. Leverage: Describe any leverage being provided by the applicant, co-applicant, and partner(s) in support of the proposed project. (Up to 10 points)

16. Communications Plan: Describe efforts to keep the public informed of project progress and the broadband adoption plan. a. Explain how you plan on communicating the project status to stakeholders, including but not limited to County leadership, project areas residents, etc. (Up to 10 points)

b. Explain how you plan to promote customer take rate, including marketing activities, outreach plan, and other actions to reach the identified serviceable units

within the project area. Provide the anticipated take rate and describe the basis for the estimate. (Up to 10 points)

c. Describe any digital literacy efforts to ensure residents and businesses in the proposed project area sufficiently utilize broadband. Please list any partnering organizations for digital literacy, such as the local library or cooperative extension office.

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17. Project Management: Identify key individuals who will be responsible for the management of the project and provide a brief description of their role and responsibilities for the project. Present this information in table format. Provide a brief

description of the applicant and co-applicant’s history and experience with managing grants and constructing broadband communication facilities. Project Budget and Cost Appropriateness (135 points) 18. Budget: Applicants must provide a detailed budget that outlines how the grant funds will

be utilized, including an itemization of equipment, construction costs, and a justification of proposed expenses. If designating more than one service area in a single application, each service area must have delineated budget information. For wireless projects, please include delineated budget information by each tower. Expenses should be substantiated by clear cost estimates. Include copies of vendor quotes or documented cost estimates supporting the proposed budget. Label Attachments: Attachment 12 – Derivation of Costs; Attachment 13 - Documentation of Supporting Cost Estimates. (Up to 10 points)

19. The cost benefit index comprises state cost per unit passed. Individual cost benefit scores are calculated and averaged together to create a point scale for a composite score. Provide the following: a. Total VATI funding request b. Number of serviceable units (Up to 125 points)

Commonwealth Priorities (50 points)

20. Additional points will be awarded to proposed projects that reflect Commonwealth priorities. If applicable, describe the following: a. Businesses, community anchors, or other passings in the proposed project area that will have a significant impact on the locality or region because of access to broadband. b. Unique partnerships involved in the proposed project. Examples include electric utilities, universities, and federal/state agencies. c. Digital equity efforts to ensure low to moderate income households in the proposed project area will have affordable access to speeds at or above 100/20 Mbps, include information regarding the internet service provider’s participation in the Affordable Connectivity Program. d. The co-applicant’s efforts to mitigate supply chain constraints, including labor shortages and order-to-delivery delays on telecommunications materials required to construct broadband networks.

e. The co-applicant’s efforts to mitigate costs and delays that may be associated with make-ready and other permitting requirements anticipated for network deployment. f. The applicant’s and co-applicant’s efforts to promote broadband adoption, including, but not limited to telehealth, smart farming, e-entrepreneurship, and distance learning.

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Additional Information

21. Please attach any letters of support from stakeholders. If the applicant is not a locality(s)

in which the project will occur, please provide a letter of support from that locality.

Attachment 14 – Letters of Support.

22. Provide any other information that the applicant desires to include. Applicants are limited to four additional attachments.

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List of Required Attachments, PDF Format Required

• All Attachments MUST be uploaded in PDF format

1. Map(s) of project area, including proposed infrastructure. ● Label Attachment: Attachment 1 – Project Area map
2. Documentation of Federal Funding (CAF/ACAM/USDA/RDOF, etc.…) in and/or

near proposed project area. ● Label Attachment: Attachment 2 – Documentation of Federal Funding Area

1. Documentation that proposed project area is unserved based on VATI criteria ● Label Attachment: Attachment 3 – Documentation Unserved Area VATI Criteria
2. Passings Form (Please use template provided) ● Label Attachment: Attachment 4 – Passings Form
3. Documentation of RDOF awarded area in VATI project area, if needed ● Label Attachment: Attachment 5 – RDOF Awarded Areas included in VATI Application
4. Propagation Map and Heat Map if Wireless Project ● Label Attachment: Attachment 6 – Propagation Map (Wireless Projects only)
5. Timeline/Project Management Plan ● Label Attachments: Attachment 7 – Timeline Project Management Plan
6. MOU/MOA between applicant/co-applicant (can be in draft form) ● Label Attachment: Attachment 8 – MOU.MOA between Applicant/Co-Applicant
7. Funding Sources Table

● Label Attachment: Attachment 9 – Funding Sources Table 10. Documentation for match funding ● Label Attachment: Attachment 10 – Documentation of Match Funding 11. Prior Expended Match Form ● Label Attachment: Attachment 11 – Prior Expended Match Form 12. Derivation of Cost (Project Budget) ● Label Attachment: Attachment 12 – Derivation of Costs 13. Documentation supporting project costs (e.g., vendor quotes) ● Label Attachment: Attachment 13 – Documentation of Supporting Cost Estimates 14. Letters of Support ● Label Attachment: Attachment 14 - Letters of Support 15. Two most recent Form 477 submitted to FCC. ● Label Attachment: Attachment 15 – Two most recent Form 477 submitted to the FCC or equivalent. 16. Point and Polygon shapefiles, in .zip file form, showing proposed passings and project area

● Label Attached. Zip Folder: Attachment 16 - Point and Polygon Shapefiles 17. For wireless applicants: shapefiles, in .zip file form, indicating RSSI projections in the application area ● Label Attached. Zip Folder: Attachment 17 – RSSI Projection Shapefiles 18. Label Additional Attachments as: ● Attachment 18 – XXXXXXX ● Attachment 19 – XXXXXXX ● Attachment 20 – XXXXXXX

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List of Required Attachments, Shapefiles

• All shapefiles MUST be functional

1. Point shapefiles that show each proposed passing in the application area as a singular mapped point containing attribute data showing the addresses of each point.

1. Polygon shapefiles delineating the general challenged area(s).

1. For wireless providers: Shapefiles displaying heat maps indicating received signal strength indicator (RSSI) in the application area accounting for terrain and vegetation.

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Virginia Telecommunication Initiative (VATI)

Freedom of Information (FOIA) Policy Effective July 1, 2019 § 2.2-3705.6:

(32) Information related to a grant application, or accompanying a grant application, submitted to the Department of Housing and Community Development that would (i) reveal (a) trade secrets, (b) financial information of a grant applicant that is not a public body, including balance sheets and financial statements, that are not generally available to the public through regulatory disclosure or otherwise, or (c) research-related information produced or collected by the applicant in the conduct of or as a result of study or research on medical, rehabilitative, scientific, technical, technological, or scholarly issues, when such information has not been publicly released, published, copyrighted, or patented, and (ii) be harmful to the competitive position of the applicant. The exclusion provided by this subdivision shall only apply to grants administered by the Department, the Director of the Department, or pursuant to § 36-139, Article 26 (§ 2.2-2484 et seq.) of Chapter 24, or the Virginia Telecommunication Initiative as authorized by the appropriations act.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

a. Invoking such exclusion upon submission of the data or other materials for which protection from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

c. Stating the reasons why protection is necessary.

The Department shall determine whether the requested exclusion from disclosure is necessary to protect the trade secrets or confidential proprietary information of the applicant. The Department shall make a written determination of the nature and scope of the protection to be afforded by it under this subdivision.

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Virginia Telecommunication Initiative (VATI) Freedom of Information (FOIA) Policy

All entities requesting Freedom of Information (FOIA) exemption for information pertaining to the VATI program shall submit the request for exemption in writing detailing the documentation to vati@dhcd.virginia.gov. DHCD FOIA exemptions do not extend to local government co-applicants. Only materials submitted to DHCD directly are subject to consideration for a FOIA-exemption. Pursuant to 2.2-3705.6-32, the Department of Housing and Community Development (DHCD) will make a written determination within ten (10) days of the request as to whether FOIA-exemption will be afforded as well as the nature and scope of the protection. Upon receipt of the written determination from DHCD documents must be submitted to vati@dhcd.virginia.gov. All exempted information will be securely maintained and accessed by VATI staff only.

Grant Applications

Consistent with VATI Guidelines, DHCD will continue to make available online submitted VATI applications. DHCD respects the right of the public to access to public information about the VATI program and encourages applicants to only request a FOIA-exemption when absolutely necessary. Applications submitted through CAMS must only include information that is open to the public. Applicants may request to submit supplementary information to the application that includes a FOIA-exemption, pursuant to “§ 2.2-3705.6” for information related to a grant application that may make the application more competitive. FOIA-exemption requests must be sent directly to vati@dchd.virginia.gov, and the applicant must indicate for which VATI application the information corresponds. Applicants wishing to submit multiple FOIA exemption requests for multiple VATI applications must do so individually in separate requests.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

a. Invoking such exclusion upon submission of the data or other materials for which protection from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

c. Stating the reasons why protection is necessary.

The Department shall determine whether the requested exclusion from disclosure is necessary to protect the trade secrets or confidential proprietary information of the applicant. The Department shall make a written determination of the nature and scope of the protection to be afforded by it under this subdivision.

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Challenge Applications

Prospective challengers are strongly encouraged to contact applicants directly and discuss the contested project area before submitting a challenge. Many issues can be resolved without a formal challenge process.

Entities wishing to request FOIA exemption on information related to a VATI application challenge must submit any requested information directly to vati@dhcd.virginia.gov. Incumbents with information such as existing street level data in a proposed project area are required to submit a challenge. Challengers wishing to request exemption for multiple challenges must do so individually, in separate requests. Applicants who have received a challenge will be notified and may request FOIA exemption, pursuant to “§ 2.2-3705.6-3” of the Code of Virginia for information pertaining to their rebuttal.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

a. Invoking such exclusion upon submission of the data or other materials for which protection from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

c. Stating the reasons why protection is necessary.

The Department shall determine whether the requested exclusion from disclosure is necessary to protect the trade secrets or confidential proprietary information of the applicant. The Department shall make a written determination of the nature and scope of the protection to be afforded by it under this subdivision.

Grant Monitoring

Projects awarded funds managed and awarded through the VATI grant making process currently work with DHCD to monitor the completion and success of those projects. Entities wishing to request FOIA exemption on information relevant to evaluating the success of awarded projects, including take rate, must submit any requested information directly to: vati@dhcd.virginia.gov

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

d. Invoking such exclusion upon submission of the data or other materials for which protection

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from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

c. Stating the reasons why protection is necessary The Department shall determine whether the requested exclusion from disclosure is necessary to protect the trade secrets or confidential proprietary information of the applicant. The Department shall make a written determination of the nature and scope of the protection to be afforded by it under this subdivision.

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Definitions Adjacent – adjoining parcels sharing a roadway, private or public, other than highways or expressways as a common boundary

Business – An organization or entity that provides goods or services in order to generate profit.

Businesses based in residential homes can count if they are a registered business (BPOL, LLC, etc.).

Community Anchor - schools, libraries, medical and health care providers, public safety entities, community colleges and other institutions of higher education, and other community support organizations and agencies that provide outreach, access, equipment, and support services to facilitate greater use of broadband service by vulnerable populations, including low-income, unemployed, and the aged.

Digital Subscriber Line (DSL) – A technology for bringing high-bandwidth information to homes and small businesses over ordinary copper telephone lines.

Eligible Project Costs – Expenses eligible for reimbursement under the VATI grant.

Fiber-to-the-Home (FTTH) – A network that delivers internet service over optical fiber directly to an end-user home, business, or other Unit.

Fixed Wireless – Wireless devices or systems that are situated in fixed locations.

Hybrid Fiber Coaxial (HFC) – A broadband network combining optical fiber and coaxial cable.

Last-Mile – Components of a network that provide broadband service to end-user premises or devices through an intermediate point of aggregation (e.g., remote terminal, fiber node, wireless tower, or other equivalent access point).

Leverage-Non-match cash or non-match in-kind resources committed to a proposed project that do not qualify as match (i.e., federally funded projects like CAFII, A-CAM, etc.) or being used as match (i.e., volunteer labor, engineering or design, etc.).

Middle-Mile – Network components that provide broadband service from one or more centralized facilities (e.g., the central office, the cable head-end, the wireless switching station, or other equivalent centralized facilities) to an Internet point of presence.

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Non-Residential Passing – Places of worship, federal, state, or local facilities or other potential customers that are neither a residence, business, or a community anchor institution (as defined above).

Passing – any structure that can receive service. Multi-unit structures may be counted as more

than 1 passing, provided individual connections and accounts are planned at that structure.

Peak Interval - Weekdays from 7:00 p.m. – 11:00 p.m. local time.

Point Shapefiles – shapefiles that show each proposed passing as a singular mapped point, in the application or challenged area, containing attribute data showing the addresses of each point.

Polygon Shapefiles - shapefiles delineating the general project area(s).

RSSI - Received Signal Strength Indicator, or RSSI, is an estimated measure of power level that a wireless client device is receiving from an access point or router. See Appendix B for more information.

Service Area – Refers to the geographic territory in which an applicant has proposed to provide service.

Serviceable Units – Properties that are eligible for broadband service without additional special construction costs from the property owner/subscriber.

Special construction costs - one-time fees above normal service connection fees required to provide broadband access to a premise (i.e., service connection drop fee for serviceable units beyond the ISPs set standard length or require nonstandard equipment)

Street Level Data – Address ranges or specific addresses from an existing provider along with the existing number of customers within those ranges. No personal information on specific

customers will be requested.

Unserved – Properties that currently have access to internet speeds below 100 Megabits per second (Mbps) download and 20 Megabits (Mbps) upload.

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Appendix A-Sample VATI Application Notice

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2024 Virginia Telecommunication Initiative

SAMPLE VATI APPLICATION NOTICE FORMAT

[Insert Date] Tamarah Holmes, Ph.D.

Director10 Office of Broadband Department of Housing and Community Development 600 East Main Street, Ste 300 Richmond, VA 23219

Dear Dr. Holmes: I am providing this VATI Application Notice t o notify the Virginia Department of Housing and Community Development of [insert name of unit of local government] and [private

provider (optional)]’s may submit an application for the FY2024 Virginia Telecommunication Initiative (VATI).

[Name of unit of local government, organization] and [private provider (optional)] intends to submit an application for [summary description of Project to be funded] within approximately [proposed Project Area(s)].

[Name] will be our main point of contact for the purposes of the application process, and can be reached at:

[Mailing Address] [Phone Number] [Email Address]

[Name of applicant government, organization and [ private provider (optional)] understands that this VATI Application Notice is required in order to submit an application for the 2024 Virginia Telecommunication Initiative and that this notice is not binding on the entity represented by the undersigned, Virginia Department of Housing and Community Development.

[Type the closing]

[signature] Type the sender’s name] [Type the sender’s title]

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Appendix B - Received Signal Strength Indicator

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Received Signal Strength Indicator

RSSI: Received Signal Strength Indicator is an estimated measure of power level that a wireless client device is receiving from an access point or router.

At larger distances, the signal becomes weaker and the wireless data rates become slower, leading to a lower overall data throughput. RSSI is measured in decibels from 0 to -120, the closer the value to 0 the stronger the signal will be, -55 is considered the best possible signal with measures of -90 and below considered unusable signal. Indoor best practices for mixed use networks see RSSI values of -75 to -80 and for session-based networks (Video Conferencing, Wi-Fi calling, etc.)

• 60 to -65

Below figure (1) shows an example of the RSSI distribution around a wireless site. Please note this is not an actual representation of wireless coverage maps and shows an unimpeded representation of wireless coverage.

Figure (1)

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Appendix C – Requirements of Speed Tests

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Requirements of Speed Tests

As outlined in VATI Program Guidelines and Criteria, DHCD reserves the right to request verified speed tests on all or portion(s) of a co-applicants’ or challenger’s existing network. Upon the request of DHCD, verified speed tests must be conducted at times of peak network usage and be distributed throughout a challenged area or service territory.

DHCD prefers speed tests be conducted at the access point (i.e., customer premise equipment, router, or modem) at the end-user location. Recognizing the feasibility constraints of conducting

speed tests at end-user locations, speed tests that are reported by the management application software at the network operations center will also be considered as valid.

The percent of required speed tests on a co-applicant’s or challenger’s existing network will depend on the size of the challenged area.

Requirements of Co-Applicants:

If DHCD requests co-applicants to submit verified speed tests distributed throughout a service territory at times of peak network usage from a co-applicant’s existing network. The number of speed tests should be no less than 10% of the passings included in the application area. In the event the co-applicant does not have enough customers to achieve the required 10% or greater speed tests based on the number of passings included in the application area, DHCD will consider field tests data to satisfy the 10% requirement. When submitting this information to DHCD, speed tests or field tests must be listed in a spreadsheet along with the address of the unit or location at which the speed test or field test was conducted. If these materials submitted are incomplete, DHCD will consider the application invalid.

Requirements of Challengers:

If challengers are required to submit verified speed tests as a part of their challenger or are requested by DHCD to submit speed test information, the number of required speed tests will be based upon the total number of challenged units. Please see the table below for the required number of speed tests.

Number of Less than 500 500 or Greater, but 1000 or Greater Challenged less than 1000 Locations within an Application Area Required Percentage 10% 7.5% 5%

of Speed Tests, based on Total Number of Challenged Units

In the event the challenger does not have enough customers to achieve the required percentage of speed tests, DHCD will consider field tests data to satisfy the requirement. When submitting this information to DHCD, speed tests and field tests must be listed in a spreadsheet along with the address of the unit or location at which the speed test or field test was conducted. If these materials submitted are incomplete, DHCD will consider the application invalid.

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[TABLE 37-1] Number of Challenged Locations within an Application Area | Less than 500 | 500 or Greater, but less than 1000 | 1000 or Greater Required Percentage of Speed Tests, based on Total Number of Challenged Units | 10% | 7.5% | 5%

[/TABLE]

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Virginia Telecommunication

Initiative (VATI)

2024 Program

Guidelines and Criteria

[TABLE 1-1] 2024 Program Guidelines and Criteria

[/TABLE]

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Table of Contents

Background 3 Summary of Changes to the 2024 VATI Guidelines and Criteria Program 4

Description 6 Definition of Broadband 6

Freedom of Information Act (FOIA) 6 Eligible Applicants 7 Selection Process 7 Infrastructure Investments and Jobs Act 7

Technical Assistance 8 Universal Coverage 8 Eligible Areas 8 Previously Funded Areas 9 Multiple Applications 11 Project Financing 11 VATI Notice of Application 12 Challenge Process 12 Implementation Deadline 14 Organizational and Management Capabilities 15 Application Due Date 16 Evaluation Criteria 17 Application Questions 19 List of Required Attachments, PDF Format Required 23 List of Required Attachments, Shapefiles 24 Freedom of Information (FOIA) Policy 27

Definitions 30 Appendix A-Sample VATI Application Notice 32

Appendix B - Received Signal Strength Indicator 34 Appendix C - Requirements of Speed Tests 36

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Background

The digital divide—the lack of universal broadband—is a critical infrastructure issue for community and economic development, promoting sustainability, growth, health care access via telemedicine, and workforce improvement.

It also enhances educational opportunities via distance learning and fosters an entrepreneurial economy for home-based and small businesses to compete globally.

Disconnected communities struggle to retain businesses due to slow or limited broadband, which is vital for online banking, e-commerce, marketing, customer service, and communication—essential in the 21st-century economy.

Guidance and questions on project development, VATI, guidelines, or criteria should be directed to:

VATI email address vati@dhcd.virginia.gov

Tamarah Holmes, Ph.D. Director, Office of Broadband

Caroline Luxhoj, VATI Program Manager

Cole McAndrew, Broadband Policy Planner

Please refer questions regarding your application to: vati@dhcd.virginia.gov

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Summary of Changes to the 2024 VATI Guidelines and Criteria

BEAD Program Funding

The Department of Housing and Community Development’s Office of Broadband has been

designated by Governor Youngkin as the recipient and administering agent for BEAD funding in Virginia. BEAD and state general funds fall under the Virginia Telecommunication Initiative; proposals for BEAD will be scored and governed by federal guidance, while those for state funds will follow FY24 VATI Guidelines.

administered via FY24 VATI Guidelines and Criteria.

Eligible applicants are encouraged to apply for both funding sources.

Consideration of area eligibility; proposals can receive funds from both programs if eligible and non-duplicative. DHCD may make determinations on VATI awards based on ISP capacity, technology feasibility under BEAD, and funding eligibility, among other factors.

May partially award applications and request info for a subset of the original area during the application process for state funding.

Applicants, including ISPs, are encouraged to contact DHCD before applying for BEAD or state funds to discuss program alignment and discrepancies.

Connect America Fund Phase II

In 2018, FCC’s CAF-II auction allocated over $108 million to extend broadband

The program extends infrastructure to over 39,800 locations with a 6-year deadline after FCC documentation; some areas remain unbuilt.

To address unbuilt areas and ensure broadband access for these locations

have broadband access regardless of federal program outcomes.

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Unbuilt CAF-II areas may be included in VATI applications,

if the CAF-II awardee and VATI co-applicant differ and the project provides access before the CAF-II deadline.

DHCD may provisional award these areas, contingent on the CAF-II ISP’s de-obligation without FCC penalty.

Project Financing

Removed the requirement that applicants and co-applicants must be unsuccessful in a prior VATI round to count prior-expended match.

Commonwealth Priorities

Under Commonwealth Priorities, co-applicant must address efforts to mitigate costs and delays from make-ready and permitting for deployment.

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Program Description

DHCD administers VATI to enhance community sustainability and growth by preparing communities to build, utilize, and

to capitalize on telecom infrastructure. DHCD will fund eligible applicants to provide last-mile services to unserved areas, awarding amounts based on application quality and quantity.

VATI aims to provide financial assistance to supplement construction costs by private broadband providers, in partnership with

local governments to extend service to unserved areas.

Definition of Broadband

Broadband is high-speed data transmission over internet.

For VATI, broadband is internet speeds of at least 100

Mbps download and 20 Mbps upload.

Freedom of Information Act (FOIA)

Under VA Code § 2.2-3705.6-32, DHCD can withhold certain public record information from disclosure.

FOIA exempts grant application info that reveals trade secrets, non-public financial data, or unreleased research, which could harm the applicant’s competitive position.

Research data not publicly released that could harm the applicant’s competitiveness is exempt; applicants must request FOIA exemption in writing.

Applicants must request FOIA exemption in writing; shapefiles are not exempt, but RSSI measures are eligible for exemption.

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Eligible Applicants

Applications must be submitted by a government unit (Towns, Cities, Counties, EDAs/IDAs, Planning Districts, School Divisions, etc.) with a private sector ISP as co-applicant. Projects must be owned and operated by the private sector co-applicant. Public networks are eligible if partnered with a private sector co-applicant serving as the customer-facing ISP.

Public broadband authorities may apply directly for VATI funds without private sector investment, limited to 10% of FY2024 state general funds. DHCD may update guidance after budget finalization.

Selection Process

Awardees will be selected through a competitive application process. Application questions will be

Questions focus on broadband needs, ready-to-construct projects needing financial aid, applicant’s readiness, and broadband speeds ≥100 Mbps download and 20 Mbps upload. DHCD may revoke awards for misrepresentation.

Broadband Equity, Access, and Deployment (BEAD) Program Funding

DHCD’s Office of Broadband, designated by Governor Youngkin, will receive and administer BEAD Program funding for Virginia. Both BEAD funding used for

Broadband and state funds fall under the Virginia Telecommunication Initiative; BEAD proposals will follow federal guidance, while state funds follow FY24 VATI Guidelines.

Applicants are encouraged to apply for both funding sources, considering area eligibility. Projects can receive funds from both if eligible and no

No duplication of funding. DHCD may determine VATI awards based on ISP capacity, technology feasibility, area eligibility, and may partially award applications or request additional info.

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DHCD may request info for parts of an area during the application process for state funds.

Applicants, including ISPs, are encouraged to contact DHCD before applying for BEAD or state funds to discuss program alignment and differences.

Technical Assistance

DHCD staff can assist with application development and challenge process for local governments, ISPs, grant writers,

Consultants and stakeholders should contact DHCD and review the broadband toolkit at www.commonwealthconnect.virginia.gov/broadband-toolkit before hiring consultants. Ongoing technical assistance is recommended.

Universal Coverage

DHCD encourages applicants to ensure all projects either achieve or are part of a plan to achieve universal broadband for the locality or region. Localities can find resources for developing a universal broadband plan on the Commonwealth Connect website at www.commonwealthconnect.virginia.gov/broadband-toolkit. DHCD recognizes that due to the nature of wireless projects having an inherent potential of overlap it is strongly encouraged that

Applicants should contact DHCD for assistance. Projects focusing only on dense pockets without nearby unserved areas (cherry picking) harm overall broadband economics and increase costs.

Eligible Areas

DHCD will award funding to applicants to provide last-mile services, including middle-mile

networks, equipment, or investments to deliver last-mile service to unserved areas, defined as speeds below 100 Mbps download and 20 Mbps upload. Areas below 25 Mbps download and 3 Mbps upload will receive priority.

priority in application scoring.

● For a wireline project, a proposed project area is considered eligible if 20 percent or fewer of serviceable units have access to service with no special construction costs from any provider as of the date of the application. ● For a wireless project, a proposed area is considered eligible if 25 percent or fewer of serviceable units have access to service with no special construction costs from any provider as of the date of the application. Passings with RSSI below -90dbm are not eligible to be included in a VATI application. 8 | Page

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Applicants should include passings with special construction costs for low/moderate income residents, especially those with extended setbacks beyond standard maximum distances.

Applicants may include locations lacking broadband due to special construction costs. VATI is suited for extending to scattered locations; LECAP covers costs for scattered areas, not long drops. Contact DHCD for project scope.

DHCD discourages relying solely on broadband maps for unserved areas; maps should be supplemented with further evaluation. Contact DHCD for best practices.

Previously Funded Areas

Applicants must verify if their VATI area has received state or federal broadband funds, including programs like VT, Tobacco Revitalization, CAFII, USDA Reconnect, USDA Community Connect, ACAM, RDOF.

Federally and state funded areas with existing agreements or current service below 100/20 Mbps are eligible. Areas with ≥100/20 Mbps are ineligible for VATI funds.

Recipients of federal or state funds awarded to provide service below 100/20 Mbps but over this threshold must submit a challenge based on actual serviceability if infrastructure exists; if not, challengers may submit speed test data from Virginia service areas to demonstrate capability.

see Appendix C for guidance on speed test numbers acceptable practices for speed tests. In instances where possible, DHCD encourages local governments to explore partnerships with internet service providers which received the previous state or federal award to upgrade coverage in these areas; however, no scoring preference will be assigned to local governments partnering with the state or federally awarded internet service provider during application evaluation.

VATI co-applicants awarded federal funds cannot use them as matching but are encouraged to leverage these awards to extend service beyond federal award areas.

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or to accelerate RDOF federal award construction.

Connect America Fund Phase II

In 2018, FCC’s CAF-II auction allocated over $108 million to extend broadband to 39,800 locations in the Commonwealth, with a 6-year construction deadline after documentation finalization.

After FCC documentation, many CAF-II areas are built; some remain unconstructed across the Commonwealth.

Unbuilt CAF-II areas may be included in VATI applications to ensure broadband access regardless of federal program outcomes.

provided the CAF-II awardee and VATI co-applicant are not the same entity and the project timeline would provide broadband access ahead of the CAF-II construction deadline.

The Department of Housing and Community Development may provisionally award these CAF-II funded areas. Awards in these areas will be contingent to the CAF-II awarded internet service provider’s de-obligation of these areas without penalty by the FCC.

Rural Digital Opportunity Fund

On December 7, 2021, FCC announced Phase 1 RDOF results; lower-than-expected funding challenged providers’ ability to deliver services. Passings in RDOF areas may be included in VATI applications to accelerate broadband access.

RDOF passings in VATI applications must gain broadband access within the contract period; they cannot exceed VATI passings unless DHCD waives this case-by-case.

In some localities, RDOF locations may outnumber remaining unserved passings.

If RDOF passings exceed VATI passings, the co-applicant must explain.

Combining RDOF with VATI

Due to FCC delays, areas preliminarily awarded RDOF are eligible for VATI applications regardless of bidder.

Non-VATI RDOF awardees may challenge applications including their areas; credible challenges require removal and a 3-year commitment to provide broadband.

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Challengers must sign an MOU with DHCD and the VATI applicant/locality to construct removed areas by contract execution; DHCD may note if a

If a credible challenge is based on a final RDOF award and the awardee defaults, they cannot submit future VATI applications for that area unless a local government partner expresses intent.

Unchallenged RDOF areas with an MOU are considered served; otherwise, they are unserved and eligible for VATI.

RDOF areas awarded to non-VATI providers and unchallenged are considered unserved and scored accordingly.

Leveraging RDOF in achieving Universal Coverage

If RDOF areas are in a VATI application achieving universal coverage

In counties, each RDOF passing in a VATI application earns ½ the VATI passing score; multiple applications with different co-applicants can cumulatively reach universal coverage.

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RDOF passings in applications reaching universal coverage will score at ½ VATI passing value.

If RDOF in a VATI application does not achieve universal coverage but is part of a universal plan, each passing scores at ¼ VATI value; RDOF can’t be included otherwise. RDOF valuations also apply to businesses and anchor institutions.

DHCD may update guidelines if FCC’s Phase I RDOF results change due to federal rule adjustments.

Multiple Applications

Local governments may submit multiple applications with different providers, including cross-jurisdictional areas. Only one last-mile provider per application.

Each last-mile provider must be in a separate application; providers can partner with multiple local governments. Multiple applications can reach universal coverage; non-contiguous areas are allowed. Each jurisdiction must be clearly delineated with data and budget for each.

city.

Project Financing

VATI funding shall not exceed 80% of total project cost. The program is competitive; projects with greater match are more likely to score higher.

Consistent with VATI’s budget language; the private co-applicant must contribute at least 10% cash match. If below 10%, applicants must provide financial details.

demonstrating appropriate private investment relative to project density and scope.

Local government expenses from one year before application open date are eligible as match if related to the VATI project and meet criteria. Expenses by ISPs after May 11, 2023 are also eligible if related and meet criteria.

reserves the right to determine the validity of matching funds and accept a proportion when necessary. Expenses

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Local government expenses to be considered as match must be included and described in the Prior Expended Match Form as an attachment.

Local government support via LFRF funds from the American Rescue Plan Act is

strongly encouraged. LFRF contributed to a VATI application are considered match funds.

Pending state allocation of Infrastructure Investment and Jobs Act funds, DHCD reserves the right to determine award funding sources. Nonstate general fund awards

such awards can fund VATI applications and are subject to funding source rules.

VATI Notice of Application

Applicants must issue a VATI Notice of Application by October 19, 2023, detailing intent and submit a copy

to DHCD at: vati@dhcd.virginia.gov. Sample notice is in Appendix A.

VATI Notices will be posted on DHCD’s webpage within 5 business days after the deadline.

Application Due Date

Applications are due by 11:59 p.m. on December 19, 2023. DHCD offices close at 5:00 p.m., and staff will not provide CAMS technical

assistance after 5:00 p.m.

Challenge Process

Challengers are encouraged to contact applicants directly to discuss contested project areas before submitting a challenge, as areas can often be re-scoped to

remove overlap. Evidence of serviceability must show a reasonable number of customers within the claimed service area.

Service in a proposed area is challenge-eligible if state or federal funds have been awarded and the provider committed to service. Areas with existing agreements or current service below 100/20 Mbps are

eligible for VATI funding. Areas with service obligations ≥100/20 Mbps are ineligible unless specified in guidelines.

Some providers funded for <100/20 Mbps now offer >100/20 Mbps. If infrastructure is built, providers must challenge based on actual serviceability; if not, challengers must submit speed test data from Virginia territories.

considered as the provider’s capability to deliver over 100/20 Mbps. Please

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see Appendix C for guidance on speed test numbers and practices. DHCD reserves the right to request verified speed tests at times of peak network usage and street level data of customers receiving service within the proposed project area in federally awarded areas to ensure serviceability.

Adjacent areas may be challenged if existing awards cover them. If an incumbent serves one side but not the other, the unserved side is eligible if the provider won’t connect it. Challengers must commit to serving at or above VATI speeds.

DHCD will post electronic copies of all submitted applications to the agency website on or by January 4, 2024. Providers wishing to submit a challenge must provide the information required in this section no later than February 8, 2024. Applicants will be notified if their proposed project area is being challenged by February 15, 2024 and will have 15 business days from notification of a challenge to provide rebuttal information to DHCD.

Providers must submit separate challenges for each application.

for each application. Challenges may target parts of a project area without invalidating the whole. DHCD can invalidate parts, aggregate challenges, or invalidate insufficient ones.

Challengers, individually or collectively, must demonstrate that over 20% for wireline or 25% for wireless projects of serviceable units in the project area have access to speeds

above 100/20 Mbps as of the application date or ineligible due to committed state or federal funding per above conditions.

DHCD must receive all detailed below or challenge is incomplete and invalid. Challengers must provide:

1. A signed and notarized affidavit affirming the challenge and attached information is true.
2. Current FCC Form 477 or equivalent.
3. Minimum/maximum speeds available in the proposed project area.
4. Number of serviceable units in the area and their speeds.
5. Street-level data of customers receiving service in the area.
6. Point shapefiles that show each proposed passing in the challenged area, designated by a

singular mapped point, in the challenged area containing attribute data showing the addresses of each point; and Polygon shapefiles delineating challenged area(s). (Note: These files must be provided in .zip file form)

1. Wireless providers: Heat maps of RSSI in the challenged area, considering terrain and vegetation (must be in .zip).
2. Wireless providers must note if bandwidth is shared or dedicated in

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the challenged area.

1. Using the submitted project area map, create a map indicating where the

challenger’s serviceable units are in the proposed project area. Challengers are encouraged to submit additional maps and info. 10. For challenges due to planned state or federal funding, provide documentation of service commitments. 11. If the challenger hasn't submitted service territory data meeting the

If not meeting ISP Service Territory Data Guidelines, submit data for consideration. 12. For variable speed tech challenges (DSL, Fixed Wireless), submit verified speed tests during peak usage on all or part of the challenged area.

Please see Appendix C for additional guidance on the number of speed tests

required and acceptable practices for conducting speed tests.

DHCD encourages challengers to contact staff for shapefile guidance before submission. Use VATI applicant’s point shapefiles from the Open Data Portal to clip challenged addresses, ensuring accurate representation within the VATI area.

This ensures challenged location shapefiles match geographically with VATI application shapefiles.

DHCD will review challenge and rebuttal info to assess credibility. DHCD may request verified speed tests during peak usage on all or part of the challenged area. If requested, the

The challenger has 10 days to respond to DHCD’s request. DHCD may re-scope and fund remaining parts of the application. See Appendix C for speed test guidance. DHCD will notify in writing by April 12, 2024 if a challenge is credible. After notification, applicants have 10 days to submit rescope materials: updated map, point and

polygon shapefiles of the updated area, Funding Sources Table, VATI Passings, RDOF Passings (if applicable), and Derivation of Costs.

Proposals to modify awarded projects are subject to the VATI challenge process if a new area is added.

Implementation Deadline

Applicants must complete projects within 18 months, starting from contract execution. DHCD may consider longer timelines for larger areas if justified.

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Applicants can request extended timelines; DHCD may fund only phases of larger projects.

Extensions may be granted for delays outside the applicant’s control.

outside the applicant’s control. Contact DHCD staff for project scope questions.

Organizational and Management Capabilities

Applicants and co-applicants must demonstrate organizational and management capabilities. To verify this, they and private partners must submit the following documents and/or attest to each of the

following:

1. Documentation that proposed project area is unserved based on VATI criteria.
2. Private co-applicant must provide proof of filing FCC Form 477 by the deadline.

Most recent forms prior to application. If no FCC Form 477, provide reasoning, business background, customer count, assets, or equivalent.

1. Point shapefiles show each proposed passing as a mapped point with attribute data of addresses; polygon shapefiles delineate the general project area.

area(s). Polygon shapefiles delineating project area(s). (Files must be in .zip form)

1. For wireless providers: Heat maps showing projected RSSI in the application area, accounting for terrain and vegetation (must be in .zip format).
2. Projects must be fully financed through a combination of the total requested funds,

committed matching funds from the applicants, and in-kind resources.

1. Private co-applicants must document current assets (cash, equivalents, callable capital, or commitment letter) at least equal to the proposed match funds, contributing an appropriate match to the total project cost.

1. Applicants must be in good standing with all Virginia contracts and comply with federal, state, and local laws.
2. If the co-applicant hasn't submitted service territory data per ISP Data Submission Guidelines, they must do so for application consideration.

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DHCD may request verified speed tests during peak usage from co-applicant’s network to verify capability at or above 100/20 Mbps. See Appendix C

for additional guidance on the number of speed tests required and acceptable practices for conducting speed tests.

VATI funds may cover administrative costs; see table below for allowable expenses.

Allowable Request for Total Award Administration

<$1 million $50,000 >$1 million, <$5 million $100,000

>$5 million, <$10 million $200,000 >$10 million $300,000 .

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[TABLE 17-1] Total Award | Allowable Request for Administration <$1 million | $50,000 >$1 million, <$5 million | $100,000 >$5 million, <$10 million | $200,000 >$10 million | $300,000

[/TABLE]

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Evaluation Criteria

Project Description and Need (max 75 points): Describe project fundamentals, including: overview, area determination, offered speeds, network design, and how it achieves or fits into universal broadband coverage. Note: Applicants will only

achieve max score if the application attains universal coverage in the included counties.

Project Readiness (max 40 points): Describe capacity to implement, including: leverage, marketing, digital literacy, and ensuring sufficient take rate.

● Project management plan, including key contacts, timeline, and past project/grant management.

Project Budget and Cost-Appropriateness (max 135 points): Describe detailed budget, including cost derivation, estimates, and service area breakdown.

● Information to calculate the Cost Benefit Index score ● Number of serviceable units passed and the breakdown of those passings ● Breakdown of matching funds and in-kind resources

Commonwealth Priorities (max 50 points): Describe how the project reflects state priorities, including significant impact passings.

● Unique partnerships, digital equity efforts, and scalability capacity.

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Application Questions

Project Description and Need (75 points)

1. Describe why and how the project area(s) was selected, including specific boundaries (e.g., streets, local/regional). Attach and label map: Attachment 1 – Project Area Map.

1. List existing providers and speeds in the project area; describe outreach efforts and data compilation.

with source(s).

1. Describe any nearby federal funding (CAF II, ACAM, ReConnect, Community Connect, RDOF). If awarded, provide a map verifying no conflict. Label: Attachment 2 – Federal Funding Areas.

1. To qualify for VATI, demonstrate the project area is unserved (speed <100/20 Mbps, <25% overlap wireless, <20% wireline). Describe anticipated overlap and how determined. Label: Attachment 3 – Unserved Area.

Area VATI Criteria.

1. Provide the total number of serviceable units in the project area.

Applicants should prioritize areas below 25 Mbps download and 3 Mbps upload speeds for scoring. For multiple service areas, delineate passings; label Attachment 4 – Passings Form.

a. Provide counts of VATI passings: residential, business, non-residential, and community anchors in the project area.

b. If applicable, provide RDOF passings: residential, business, non-residential, and community anchors. c. Provide the number requiring special construction costs, defined as a one-time fee above normal connection costs, and describe the projection methodology. d. Provide the number of passings in the application that will

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receive broadband access because special construction costs have been budgeted in the VATI application. Describe the methodology used for determining which passings with special construction costs were budgeted in the application.

e. Provide the number of passings with speeds 25/3 Mbps or less.

Describe methodology for these projections. (up to 15 points)

1. Indicate if RDOF blocks are in the VATI area; if so, provide a map, number of passings, and Census Block Group IDs. Label: Attachment 5 – RDOF Areas.

1. For wireless projects: Explain ownership of the wireless infrastructure; specify if the co-applicant will own or lease the mast, tower, or structure.

Estimate the number of simultaneous subscribers served at the chosen speed.

1. Describe the network design from primary internet points to end users, including existing and new components, sources, scalability, and capacity during peaks. For wireless, include a propagation map with legend. Label: Attachment 6 – Propagation Map Wireless.

10. Speeds: Describe service offerings, including download/upload speeds, bandwidth type, technology, and tiered pricing. Include maps or diagrams as needed.

Include all speed offerings. DHCD may request peak-time verified speed tests to confirm capability at or above 100/20 Mbps. Describe testing methods. (up to 10 points)

11. Explain how the project achieves or fits into universal broadband coverage, including remaining needs and plans. (up to 50 points)

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Project Readiness (40 points)

12. Describe the current project development status, including planning,

Include preliminary engineering, easements/permits, MOU/MOA status, final design, detailed timeline with tasks, responsible parties, data collection, start/end dates, and discuss easements for crossings, federal lands, partnerships, and mobile home parks.

Include MOUs/MOAs (drafts allowed). Label Attachments: 7 – Timeline/Management Plan; 8 – MOU/MOA between applicants (up to 10 points).

13. Has the applicant or co-applicant received VATI grants? If yes, list grants and their status.

14. Matching funds: Complete the funding sources table showing cash match and in-kind resources from all partners involved in the project.

VATI funding cannot exceed 80%. In-kind includes management, rights of way, permit fee waivers, labor, etc. Minimum 20% match required; private sector must provide 10%. If private match <10%, provide financial details. Include prior expended funds via Attachment 11. Label: 9 – Funding Sources; 10 – Match Documentation; 11 – Prior Expended Funds.

15. Describe leverage from applicant, co-applicant, and partners supporting the project. (Up to 10 points)

16. Describe efforts to inform the public on project progress and broadband adoption. a. Explain communication plans for stakeholders, including County leadership and residents. (Up to 10 points)

b. Explain how you plan to promote customer take rate, including marketing activities, outreach plan, and other actions to reach the identified serviceable units

within the project area. Provide the anticipated take rate and describe the basis for the estimate. (Up to 10 points)

c. Describe digital literacy efforts to ensure residents and businesses utilize broadband, listing partners like libraries or extension offices.

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17. Project Management: List key individuals responsible, their roles, and responsibilities in table format. Provide a brief

Include applicant and co-applicant’s history with grants and broadband projects. 18. Budget: Provide a detailed budget showing grant fund use.

Provide itemized budget for equipment, construction, and justified expenses. For multiple areas or towers, include separate budgets. Support costs with quotes or estimates. Label: 12 – Cost Derivation; 13 – Supporting Estimates. (Up to 10 points)

19. The cost benefit index comprises state cost per unit passed. Individual cost benefit scores are calculated and averaged together to create a point scale for a composite score. Provide the following: a. Total VATI funding request b. Number of serviceable units (Up to 125 points)

Commonwealth Priorities (50 points)

20. Additional points for projects aligning with Commonwealth priorities: a. Impactful businesses, anchors, or passings; b. Unique partnerships like utilities, universities, agencies; c. Digital equity efforts for low/moderate income households, including ACP participation; d. Co-applicant’s supply chain mitigation efforts, including labor shortages and delays.

e. Co-applicant’s efforts to mitigate make-ready and permit delays. f. Promote broadband adoption via telehealth, smart farming, e-entrepreneurship, distance learning.

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Additional Information

21. Please attach any letters of support from stakeholders. If the applicant is not a locality(s)

in which the project will occur, please provide a letter of support from that locality.

Attachment 14 – Letters of Support.

Provide any additional information; limit to four attachments.

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List of Required Attachments, PDF Format Required

• All Attachments MUST be uploaded in PDF format

1. Map(s) of project area, including proposed infrastructure. ● Label Attachment: Attachment 1 – Project Area map
2. Documentation of Federal Funding (CAF/ACAM/USDA/RDOF, etc.…) in and/or

near proposed project area. ● Label Attachment: Attachment 2 – Documentation of Federal Funding Area

1. Documentation that proposed project area is unserved based on VATI criteria ● Label Attachment: Attachment 3 – Documentation Unserved Area VATI Criteria
2. Passings Form (Please use template provided) ● Label Attachment: Attachment 4 – Passings Form
3. Documentation of RDOF awarded area in VATI project area, if needed ● Label Attachment: Attachment 5 – RDOF Awarded Areas included in VATI Application
4. Propagation Map and Heat Map if Wireless Project ● Label Attachment: Attachment 6 – Propagation Map (Wireless Projects only)
5. Timeline/Project Management Plan ● Label Attachments: Attachment 7 – Timeline Project Management Plan
6. MOU/MOA between applicant/co-applicant (can be in draft form) ● Label Attachment: Attachment 8 – MOU.MOA between Applicant/Co-Applicant
7. Funding Sources Table

● Label Attachment: Attachment 9 – Funding Sources Table 10. Documentation for match funding ● Label Attachment: Attachment 10 – Documentation of Match Funding 11. Prior Expended Match Form ● Label Attachment: Attachment 11 – Prior Expended Match Form 12. Derivation of Cost (Project Budget) ● Label Attachment: Attachment 12 – Derivation of Costs 13. Documentation supporting project costs (e.g., vendor quotes) ● Label Attachment: Attachment 13 – Documentation of Supporting Cost Estimates 14. Letters of Support ● Label Attachment: Attachment 14 - Letters of Support 15. Two most recent Form 477 submitted to FCC. ● Label Attachment: Attachment 15 – Two most recent Form 477 submitted to the FCC or equivalent. 16. Point and Polygon shapefiles, in .zip file form, showing proposed passings and project area

● Label Attached. Zip Folder: Attachment 16 - Point and Polygon Shapefiles 17. For wireless applicants: shapefiles, in .zip file form, indicating RSSI projections in the application area ● Label Attached. Zip Folder: Attachment 17 – RSSI Projection Shapefiles 18. Label Additional Attachments as: ● Attachment 18 – XXXXXXX ● Attachment 19 – XXXXXXX ● Attachment 20 – XXXXXXX

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List of Required Attachments, Shapefiles

• All shapefiles MUST be functional

1. Point shapefiles showing each proposed passing as a point with attribute data of addresses.

1. Polygon shapefiles delineating challenged area(s).

1. For wireless providers: Shapefiles with heat maps of RSSI in the application area, considering terrain and vegetation.

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Virginia Telecommunication Initiative (VATI)

FOIA Policy Effective July 1, 2019 § 2.2-3705.6:

● (32) Information submitted with a grant application to DHCD that reveals trade secrets, non-public financial data, or sensitive research info, which could harm the applicant’s competitive position, is excluded from disclosure only for grants managed by DHCD, the Department’s Director, or under § 36-139, Article 26, or the Virginia Telecommunication Initiative as authorized by the appropriations act.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

a. Invoking such exclusion upon submission of the data or other materials for which protection from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

c. Stating the reasons why protection is necessary.

The Department will decide if exclusion is necessary to protect trade secrets or confidential info and will issue a written determination of the protection scope.

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Virginia Telecommunication Initiative (VATI) Freedom of Information (FOIA) Policy

Entities requesting VATI FOIA exemption must submit a written request with documentation to vati@dhcd.virginia.gov. DHCD will decide within 10 days whether to grant exemption; exempt info will be securely stored and accessed only by VATI staff. Exemptions do not apply to local government co-applicants.

Grant Applications

DHCD will publish VATI applications online. Applicants should only request FOIA-exemptions when necessary. FOIA-exemption requests, citing § 2.2-3705.6, must be sent separately to vati@dchd.virginia.gov, specifying the application. Multiple requests require separate submissions.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

a. Invoking such exclusion upon submission of the data or other materials for which protection from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

c. Stating the reasons why protection is necessary.

The Department shall determine whether the requested exclusion from disclosure is necessary to protect the trade secrets or confidential proprietary information of the applicant. The Department shall make a written determination of the nature and scope of the protection to be afforded by it under this subdivision.

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Challenge Applications

Challengers are encouraged to contact applicants directly to resolve issues before submitting formal challenges.

Challenge-related FOIA exemption requests must be sent to vati@dhcd.virginia.gov. Incumbents with street-level data must submit challenges. Multiple requests must be separate. Challenged applicants will be notified and may request FOIA exemption for rebuttals.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

a. Invoking such exclusion upon submission of the data or other materials for which protection from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

c. Stating the reasons why protection is necessary.

The Department shall determine whether the requested exclusion from disclosure is necessary to protect the trade secrets or confidential proprietary information of the applicant. The Department shall make a written determination of the nature and scope of the protection to be afforded by it under this subdivision.

Grant Monitoring

VATI-funded projects are monitored by DHCD. FOIA exemption requests for project success info, including take rate, must be sent to vati@dhcd.virginia.gov.

In order for the information submitted by the applicant and specified in this subdivision to be excluded from the provisions of this chapter, the applicant shall make a written request to the Department:

d. Invoking such exclusion upon submission of the data or other materials for which protection

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from disclosure is sought;

b. Identifying with specificity the data, information, or other materials for which protection is sought; and

The Department will decide if exclusion is needed to protect trade secrets or confidential info and will issue a written scope of protection.

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Adjacent: parcels sharing a roadway, private or public, other than highways or expressways as a boundary

Business: an organization providing goods or services to generate profit.

Residential home businesses can count if registered (BPOL, LLC, etc.).

Community Anchor includes schools, libraries, healthcare providers, public safety, colleges, and organizations supporting broadband access for vulnerable populations, including low-income, unemployed, and aged.

Digital Subscriber Line (DSL) – Technology delivering high-bandwidth info to homes and small businesses over copper telephone lines.

Eligible Project Costs – Expenses eligible for VATI grant reimbursement.

Fiber-to-the-Home (FTTH) – Network delivering internet over optical fiber directly to end-user homes, businesses, or other units.

Fixed Wireless – Wireless devices or systems in fixed locations.

Hybrid Fiber Coaxial (HFC) – A broadband network combining optical fiber and coaxial cable.

Last-Mile – Network components providing broadband to end-user premises or devices via an intermediate aggregation point (e.g., remote terminal, fiber node, wireless tower).

Leverage-Non-match cash or in-kind resources committed to a project that do not qualify as match (e.g., federally funded projects like CAFII, A-CAM) or are used as match (e.g., volunteer labor, engineering, design).

Middle-Mile – Network components providing broadband from centralized facilities (e.g., central office, cable head-end, wireless switching station) to an Internet point of presence.

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Non-Residential Passing – Places of worship, federal, state, or local facilities, or other potential customers that are neither residences, businesses, nor community anchors (as defined above).

Passing – any structure that can receive service. Multi-unit structures may be counted as more

than 1 passing, provided individual connections and accounts are planned at that structure.

Peak Interval - Weekdays from 7:00 p.m. – 11:00 p.m. local time.

Point Shapefiles – shapefiles showing each proposed passing as a mapped point in the application or challenged area, with attribute data of addresses.

Polygon Shapefiles - shapefiles delineating the general project area(s).

RSSI – Received Signal Strength Indicator, an estimated measure of power level received by a wireless client from an access point or router. See Appendix B.

Service Area – Geographic territory where an applicant proposes to provide service.

Serviceable Units – Properties eligible for broadband without extra special construction costs from owners/subscribers.

Special construction costs – One-time fees above standard connection fees to provide broadband to a premise (e.g., service drop fee beyond standard length or nonstandard equipment).

Street Level Data – Address ranges or specific addresses from an existing provider along with the existing number of customers within those ranges. No personal information on specific

customers will be requested.

Unserved – Properties with internet speeds below 100 Mbps download and 20 Mbps upload.

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• Page 32 ---

Appendix A-Sample VATI Application Notice

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• Page 33 ---

2024 Virginia Telecommunication Initiative

SAMPLE VATI APPLICATION NOTICE FORMAT

[Insert Date] Tamarah Holmes, Ph.D.

Director10 Office of Broadband Department of Housing and Community Development 600 East Main Street, Ste 300 Richmond, VA 23219

Dear Dr. Holmes: I am providing this VATI Application Notice t o notify the Virginia Department of Housing and Community Development of [insert name of unit of local government] and [private

provider (optional)]’s may submit an application for the FY2024 Virginia Telecommunication Initiative (VATI).

[Name of unit of local government, organization] and [private provider (optional)] intends to submit an application for [summary description of Project to be funded] within approximately [proposed Project Area(s)].

[Name] will be our main point of contact for the purposes of the application process, and can be reached at:

[Mailing Address] [Phone Number] [Email Address]

[Name of applicant government, organization and [ private provider (optional)] understands that this VATI Application Notice is required in order to submit an application for the 2024 Virginia Telecommunication Initiative and that this notice is not binding on the entity represented by the undersigned, Virginia Department of Housing and Community Development.

[Type the closing]

[signature] Type the sender’s name] [Type the sender’s title]

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• Page 34 ---

Appendix B - Received Signal Strength Indicator

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• Page 35 ---

Received Signal Strength Indicator

RSSI: Received Signal Strength Indicator is an estimated measure of power level that a wireless client device is receiving from an access point or router.

At larger distances, the signal becomes weaker and the wireless data rates become slower, leading to a lower overall data throughput. RSSI is measured in decibels from 0 to -120, the closer the value to 0 the stronger the signal will be, -55 is considered the best possible signal with measures of -90 and below considered unusable signal. Indoor best practices for mixed use networks see RSSI values of -75 to -80 and for session-based networks (Video Conferencing, Wi-Fi calling, etc.)

• 60 to -65

Below figure (1) shows an example of the RSSI distribution around a wireless site. Please note this is not an actual representation of wireless coverage maps and shows an unimpeded representation of wireless coverage.

Figure (1)

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• Page 36 ---

Appendix C – Requirements of Speed Tests

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• Page 37 ---

Requirements of Speed Tests

As outlined in VATI Program Guidelines and Criteria, DHCD reserves the right to request verified speed tests on all or portion(s) of a co-applicants’ or challenger’s existing network. Upon the request of DHCD, verified speed tests must be conducted at times of peak network usage and be distributed throughout a challenged area or service territory.

DHCD prefers speed tests be conducted at the access point (i.e., customer premise equipment, router, or modem) at the end-user location. Recognizing the feasibility constraints of conducting

speed tests at end-user locations, speed tests that are reported by the management application software at the network operations center will also be considered as valid.

The percent of required speed tests on a co-applicant’s or challenger’s existing network will depend on the size of the challenged area.

Requirements of Co-Applicants:

If DHCD requests co-applicants to submit verified speed tests distributed throughout a service territory at times of peak network usage from a co-applicant’s existing network. The number of speed tests should be no less than 10% of the passings included in the application area. In the event the co-applicant does not have enough customers to achieve the required 10% or greater speed tests based on the number of passings included in the application area, DHCD will consider field tests data to satisfy the 10% requirement. When submitting this information to DHCD, speed tests or field tests must be listed in a spreadsheet along with the address of the unit or location at which the speed test or field test was conducted. If these materials submitted are incomplete, DHCD will consider the application invalid.

Requirements of Challengers:

If challengers are required to submit verified speed tests as a part of their challenger or are requested by DHCD to submit speed test information, the number of required speed tests will be based upon the total number of challenged units. Please see the table below for the required number of speed tests.

Number of Less than 500 500 or Greater, but 1000 or Greater Challenged less than 1000 Locations within an Application Area Required Percentage 10% 7.5% 5%

of Speed Tests, based on Total Number of Challenged Units

In the event the challenger does not have enough customers to achieve the required percentage of speed tests, DHCD will consider field tests data to satisfy the requirement. When submitting this information to DHCD, speed tests and field tests must be listed in a spreadsheet along with the address of the unit or location at which the speed test or field test was conducted. If these materials submitted are incomplete, DHCD will consider the application invalid.

37 | Page

[TABLE 37-1] Number of Challenged Locations within an Application Area | Less than 500 | 500-999 | 1000+ Required Percentage of Speed Tests, based on Total Challenged Units | 10% | 7.5% | 5%

[/TABLE]

• Page 1 ---

Virginia Private Activity Bond Allocation Guidelines

Local Housing Authority (LHA) Allocation

Adopted: May 13, 2024 Effective Date: January 1, 2025

TABLE OF CONTENTS

I DEFINITIONS

1. 1. Definitions

II PROGRAM OVERVIEW

1. 1. Introduction
2. 2. Availability of Bonds
3. 3. Allocation Size Limits
4. 4. Carryforward Allocation.

III ELIGIBILITY

1. 1. Eligible Use of Funds
2. 2. Threshold Requirements
3. 3. Effective Period of Allocation
4. 4. State Guidelines to Change as Federal Law Determines Eligibility

IV ADDITIONAL CRITERIA

1. 1. Reporting Requirements for Allocations

V APPLICATION REVIEW AND EVALUATION

1. 1. Dates and Submission Timeline
2. 2. Scoring Criteria
3. 3. Other Scoring Criteria
4. 4. Tiebreaker Criteria
5. 5. Scoring Rubric
6. 6. Project Approval

VI EFFECTIVE PERIOD OF GUIDELINES

VII APPENDIXES

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1. DEFINITIONS

1. 1. Definitions

A. Section 15.2-5000 of the Code of Virginia provides definitions of the following terms and phrases as used in these Guidelines:

• “Exempt project”
• “Industrial development bond”
• “Local housing authority”
• “Manufacturing facility”
• "Manufactured housing bond”
• “Private activity bond”

• “Single family housing bond”
• “State ceiling”

B. The following words and terms, when used in these guidelines, shall have the following meaning, unless the context clearly indicates otherwise.

"Allocation" or "award" means the notice given by the Commonwealth to provide a project with a specified amount from the state ceiling for a specific issue of bonds.

“Applicant” means an entity that properly submits an application for private activity bond authority in accordance with these Guidelines.

"Carryforward purpose" means certain projects that are eligible to receive an allocation during a calendar year and issue the bonds from the allocation in a later year pursuant to § 146 of the Internal Revenue Code of 1986, as amended.

“Consolidated plan” means the plan required by the United States Department of Housing and Urban Development (HUD) for State and Entitlement jurisdictions that receive funding for any of the following HUD formula programs: Community Development Block Grant (CDBG), HOME Investments Partnerships (HOME), Emergency Solutions Grant (ESG) and Housing Opportunities for Persons with

AIDS (HOPWA).

“DHCD” means Department of Housing and Community Development.

“Eligibility” means, with respect to any applicant seeking an allocation of PABs from the local housing authority allocation for projects, that the rents for the units subject to restrictions on the incomes of residents under the Code will meet rent affordability standards. Rent affordability standards can be met by allocation to the project of low-income housing tax credits under Section 42 of the Code or participation in other federal, state, or local housing affordability programs that include legally enforceable rent affordability standards.

DHCD reserves the right to waive this eligibility requirement in the case of a housing project that addresses another compelling local or state objective.

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"Governing body" means the board of supervisors of each county and the council of each city and of each town.

"Housing bonds" means multifamily housing bonds and single family housing bonds requiring allocation from the state ceiling.

"IRC” means the Internal Revenue Code of 1986, as amended.

"Issued" means that the PABs have been issued in accordance with IRC §§103 and 141-150.

"Issuing authority" means any political subdivision, governmental unit, authority, or other entity of the Commonwealth which is empowered to issue PABs.

"Locality" means a city, town, or county of the Commonwealth.

"Multifamily housing bond" means any obligation which constitutes an exempt facility bond under federal law for the financing of a qualified residential rental project within the meaning of § 142 of the Code.

"Population" means the most recent estimate of resident population for Virginia and the counties, cities, and towns published by the United States Bureau of the Census or the Weldon Cooper Center for Public Service of the University of Virginia before January 1 of each calendar year.

"Project" means the facility (as described in the application) proposed to be financed, in whole or in part, by an issue of bonds and that meets all of the requirements for eligibility set forth in these Guidelines.

“Rent affordability standards” means that the rent and any estimated cost of utilities (except telephone) payable by residents shall not exceed 30 percent of the applicable income limits under the Code during the period of time that the bonds issued to finance the project will be outstanding.

"State Allocation" means the portion of the state ceiling set aside for projects of state issuing authorities and for projects of state or regional interest as determined by the Governor.

A “Supplemental allocation” means an allocation of PABs that is supplemental to a previous year’s allocation (regardless of issuer). A supplemental allocation is for a project that has previously closed and is seeking additional allocation for the same project. A supplemental allocation is not an allocation for a separate phase of a larger development.

2. PROGRAM OVERVIEW

1. 1. Introduction

Every year, the Commonwealth of Virginia is allowed to issue a certain number of federally tax-exempt bonds. Referred to as a “private activity bond” (PAB), a PAB is used to finance certain projects that are considered “qualified private activities” under the Internal Revenue Code of 1986, as amended.

Chapter 50 (§§ 15.2-5000 through 15.2-5005) of Title 15.2 of the Code of Virginia sets aside specified amounts of the Commonwealth's limited PAB issuing authority into four allocation pools. This Chapter requires the Department of Housing and Community Development (DHCD), through the Board of

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Housing and Community Development, to “establish guidelines in accordance with this chapter that shall detail (i) the specific administrative policies, criteria, and procedures for the allocation to local housing authorities” in addition to other responsibilities.

As such, DHCD will allocate PAB authority from the local housing authority allocation through the criteria and procedures set forth in these guidelines. In administering these guidelines, DHCD has responsibilities that include:

A. Determining the state ceiling on PABs each year beyond 2008 based on the federal per capita limitation on PABs and the population.

B. Setting aside the proper amount of the state ceiling on PABs for each project type as specified in § 15.2-5002 of the Code of Virginia each year beyond 2008.

C. Receiving and review project applications for PAB authority to be awarded from the portion of the state ceiling allocated to local housing.

D. Allocating PAB authority to projects requesting bond authority from the portion of the state ceiling allocated to local housing authorities.

1. 2. Availability of Bonds

The allocation of PABs for the State is based on the federal per capita limitation on PABs. Section 15.2-5002 of the Code of Virginia reserves 14% of these bonds for local housing authorities. While these authorities issue PABs, DHCD is required to review and allocates PABs authority to qualified projects.

Yearly availability of PABs will be as posted on the DHCD website. Funding will occur in two competitive rounds with the option for a third, non-competitive round if there is available allocation.

DHCD will reserve at least 50% of the available PAB allocation for the applications applying in the second and potential third round. Any unused allocations from the first and second round will automatically be included in the subsequent round.

1. 3. Allocation Size Limits

For Allocation Round 1, an applicant may apply to receive up to $20 million per project from the portion of the state ceiling reserved for local housing authority projects. For Allocation Round 2, there is no upper limit for project allocations. There is no limit if there is an optional Round 3.

Projects are limited to one allocation per project per calendar year. However, an applicant

may reapply if they do not receive an allocation in a prior allocation round.

Projects that applied and did not receive an allocation in the first or second round will automatically be considered in subsequent application rounds, provided that i) all necessary application materials are current and that ii) the application remain identical or substantively similar to the original application. Projects with substantive changes must complete a new application.

1. 4. Carryforward Allocation

On or about December 15, DHCD will notify the Virginia Housing Development Authority (VHDA) of the amount of bond issuing authority remaining in the portion of the state ceiling reserved for local housing authorities. After this notification, VHDA must provide a written request to DHCD in order to

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have such bond issuing authority transferred to VHDA. Any bond authority that remains with DHCD and is not requested by VHDA shall be allocated to other carryforward purposes.

3. ELIGIBILITY

1. 1. Eligible Use of Funds

An entity seeking bond authority from the LHA pool of PABs for a project must be used to advance production or rehabilitation of affordable housing may submit application to DHCD. This means that the rents for the units subject to restrictions on the incomes of residents under the Code will meet rent affordability standards. Rent affordability standards can be met by allocation to the project of low-income housing tax credits in accordance with IRC § 42 of the Code or participation in other federal, state, or local housing affordability programs that include legally enforceable rent affordability standards.

1. 2. Threshold Requirements

All projects seeking an allocation of PAB authority from DHCD must file an application. Application forms are available from DHCD.

Local housing authorities seeking an allocation of bond authority for housing projects shall file Form

LHA.

All applications and requests for PAB authority from DHCD shall be accompanied by the following documentation for each project:

1. Inducement or official intent resolution or other documentation of the preliminary approval of the project by the issuing authority, in conformity with applicable federal and state law;

1. Documentation of approval of the project by the appropriate governing body (see § 5.1 of these guidelines) or elected official, in conformity with applicable federal and state law;

1. Written opinion of bond counsel that the project is eligible to utilize PABs pursuant to the Code and that an allocation of bond issuing authority from the state ceiling is required;

1. A definite and binding financing commitment from the buyer or underwriter of the bonds for the project, or if the bonds are to be sold competitively, a letter from the financial advisor for the project;

1. Certification that the project’s financing package will include low-income housing tax credits under IRC §42. If such credits are not a part of the project’s financing package, then documentation on participation in another federal, state, or local housing program with legally enforceable rent affordability standards must be included;

1. Certification signed by an accountant, executive, or other appropriate entity attesting that the applicant is requesting no more than 55% of the project’s aggregate basis in PAB allocation consistent with the submitted budget; and,

1. All applications from local housing authorities requesting an allocation of bond authority for housing projects shall be accompanied by a letter from the city manager, the town manager, the county administrator, the county executive, or other chief administrator s of the locality in which

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the project is located, stating that the project is in conformity with the Consolidated Plan covering the locality. If the locality is subject to the Commonwealth’s consolidated plan as completed by DHCD, DHCD will determine if the project is in conformity with the plan.

1. Supplemental allocation only: Supplemental allocations must certify that the allocation addresses project costs that have no alternative but to utilize additional tax-exempt bond

financing. The applicant must provide a detailed explanation of use of additional allocation and reason it was not included in original application.

1. 3. Effective Period of Allocations

An allocation of PAB authority awarded by DHCD from the portion of the state ceiling reserved for local housing authority projects shall be effective for 120 days after the allocation award date or until December 15, whichever is earlier.

Additionally, DHCD reserves the authority to extend the 120 day closing period for a project by up to 60 days but no later than December 15. Projects requesting an extension of the closing period shall notify DHCD of the need for an extended closing period and provide compelling reasons why DHCD should extend the allocation period by day 90 of the 120 day closing period

1. 4. State Guidelines to Change as Federal Law Determines Eligibility

If federal law terminates the eligibility or terminates and reauthorizes the eligibility for PAB financing for any PAB the effect shall be to exclude or include, as applicable, that portion of the PAB from these guidelines.

4. ADDITIONAL CRITERIA

1. 1. Reporting Bond Issuance

For all PABs issued in the Commonwealth from the portion of the state ceiling allocated to local housing authorities and the state allocation during any calendar year, a copy of the filed federal Internal Revenue Service (IRS) Form 8038 must be received by DHCD no later than 5:00 p.m. on the expiration date of the allocation award. Bond authority that has not been documented as having been issued by the filing of IRS Form 8038 with DHCD by this deadline will revert to DHCD for reallocation to other projects.

For all allocations to carryforward purposes, a copy of the filed IRS Form 8328 must be filed with DHCD by January 15 following the calendar year in which the carryforward award was received. In order to document the amount of bonds issued, a copy of IRS Form 8038 must be sent to DHCD when the bond(s) are issued.

5. APPLICATION REVIEW AND EVALUATION

1. 1. Dates and Submission Timeline

Applicants are strongly encouraged to notify DHCD of their intent to make application for allocation as soon as possible after January 1 of each year.

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First round applicants (or their representative) that intend to submit an application must notify DHCD of their intent to submit an application at least 30 days before the application open date.

Second round applicants/representatives must notify 30 days before the application open date. For projects that held a public hearing in the previous calendar year, they must submit notice by the

beginning of the first round of applications.

An applicant will provide notification on the appropriate form provided by DHCD. If notification is not provided, the application may not receive an allocation in the calendar year it submits an application.

Program Dates:

The following is a listing of important application and allocation dates and deadlines concerning the portion of the state ceiling administered by DHCD. DHCD will accept applications at the times indicated during the year. Please note that these are approximate dates and may be revised by DHCD as needed.

January 1 – January 15: Specified amounts of the state ceiling are reserved for different project types in the Commonwealth by either state law in each calendar year.

January 15 (Anticipated): Anticipated first round of applications opened by DHCD for Local Housing Authority PAB allocation authority. Application period will close following on or about following a thirty-day application window provided by DHCD.

April 1 (Anticipated): Anticipated second round of applications opened by DHCD. Application period will close following on or about following a thirty-day application window provided by DHCD.

July 1 (Anticipated): Anticipated opening of optional third funding round, to be scored on a rolling basis.

December 1: Last day applications will be accepted for year-end carryforward purposes.

December 15:

Last day for the issuance of private activity bonds for projects that received allocations from the state ceiling prior to this date.

December 20 – 31:

Allocations will be made to year-end carryforward purposes in accordance with the priority system established by these guidelines.

1. 2. Scoring Criteria

The overarching goal of DHCD’s allocation of PABs from the LHA pool is to promote the production and/or rehabilitation of affordable housing in high demand areas through the efficient allocation of PABs. Based on that intent, DHCD has developed three scoring criteria to help advance this allocation priority.

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Clear Description of Project Need:

DHCD will prioritize projects that address areas experiencing a greater need for affordable housing. In doing so, DHCD will consider the following criteria:

• Job creation activity in the locality’s Planning District Commission (PDC), as measured by Virginia Economic Development Partnership’s (VEDP) job announcements per person for the prior calendar year (see Appendix A for calculation); and
• Housing cost burden, calculated as the percentage of renters who pay more than 30% of their income on housing costs, as calculated by DHCD for the prior calendar year (included in Appendix B).

Demonstration of Readiness: (timeline/schedule) DHCD will give priority to projects that demonstrate clear readiness for financing and would lead to the rapid production or rehabilitation of affordable housing. In doing so, DHCD will consider:

• Presence of a valid proposed Plan of Development;
• Presence of a completed Zoning Document;
• Presence of a construction contract
• Positive Recommendation from National Council on Housing Market Analysis (NCHMA) Certified Market Analysis; and
• Sponsor Characteristics.

Efficiency for Project Allocation Request: DHCD will give priority to projects that demonstrate greater measures of project efficiency and that are mindful of the limited pool of PABs. In doing so, DHCD will consider:

• The cost per unit created or rehabilitated;
• Leveraging of other financing resources, as shown in the project’s capital stack or as determined by DHCD; and
• The bond request size, representing no more than 55% of the project’s aggregate basis in PAB allocation as certified by the appropriate entity in the project, and where smaller basis request equal a higher score.

1. 3. Other Scoring Considerations

DHCD will not prioritize new construction over rehabilitation projects or vice versa. However, DHCD will take into consideration the project’s category (new construction v. rehabilitation) when comparing measures of project readiness, efficiency, and other factors that are influenced by that categorization.

1. 4. Tiebreaker Criteria

Should DHCD receive multiple properly completed allocation requests with identical scores that exceed the available allocation for the given application round, DHCD will use a random lottery process to determine which request will receive an allocation.

1. 5. Scoring Rubric

Category Percent Possible Points Project Need – 35%

8

[TABLE 8-1]

1. 4. Tiebreaker Criteria Should DHCD receive multiple properly completed allocation requests with identical scores that exceed the available allocation for the given application round, DHCD will use a random lottery process to determine which request will receive an allocation.
2. 5. Scoring Rubric

[/TABLE]

[TABLE 8-2] Category | Percent | Possible Points Project Need – 35% | |

[/TABLE]

• Page 9 ---

10 Points: where projects located in localities with a greater job creation activity/PDC equals a higher score.

• 10 points: High Job Creation/PDC Job Creation Activity 10%
• 5 points: Medium Job Creation/PDC
• 0 points: No Job Creation/PDC 25 Points: where projects located in localities with a higher level of cost burden equals a higher score.
• 25 points: High Cost Burden

Housing Cost Burden 25% - 20 points: Above Average Cost Burden

• 15 points: Below Average Cost Burden
• 0 points: Low Cost Burden

Project Readiness – 35% Approved Plan of 5 Points: where submission of an approved plan provides 5 5% Development points. 5 Points: where submission of a document (either Zoning Document 5% demonstrating approved zoning changes or that the project is by-right) provides 5 points.

Market Analysis 10 Points: where submission of a document provides 10 10% Recommendation points. 5 Points: where presence of a fixed cost and executed construction contract equals a higher score.

• 5 points: There is an executed fixed cost construction contract.

Construction Contract 5% - 3 points: There is evidence of a construction contract that will be executed prior to closing.

• 0 points: There is no evidence of a construction contract. 10 Points: where presence of additional Developer Experience can add up to 15 points:
• 10 points : 5 or more bond projects in Virginia in the past five calendar years Sponsor Characteristics 10%
• 5 points: 1-4 bond projects in Virginia in the past five years
• 0 points: 0 projects in Virginia in the past five years Project Efficiency - 30%

10 Points: where a higher efficient use of resources (cost) score equals a higher score.

• 10 points: 80-100 score Cost per Unit 10%
• 5 points: 40-79 score
• 0 point: 0-39 score 10 Points; where evidence of more eligible resources Other Resources leverage equated to a higher score: 10% Leveraged* 10 points: at least 2 other local, state, or federal resources leveraged. 9

[TABLE 9-1] | | Job Creation Activity | | | 10% | | | | 10 Points: where projects located in localities with a greater | | | | | | | | | | | job creation activity/PDC equals a higher score. | | | | | | | | | | | - 10 points: High Job Creation/PDC | | | | | | | | | | | - 5 points: Medium Job Creation/PDC | | | | | | | | | | | - 0 points: No Job Creation/PDC | | | | Housing Cost Burden | | | 25% | | | | 25 Points: where projects located in localities with a higher | | | | | | | | | | | level of cost burden equals a higher score. | | | | | | | | | | | - 25 points: High Cost Burden | | | | | | | | | | | - 20 points: Above Average Cost Burden | | | | | | | | | | | - 15 points: Below Average Cost Burden | | | | | | | | | | | - 0 points: Low Cost Burden | | | Project Readiness – 35% | | | | | | | | | | | | Approved Plan of Development | | | 5% | | | | 5 Points: where submission of an approved plan provides 5 | | | | | | | | | | | points. | | | | Zoning Document | | | 5% | | | | 5 Points: where submission of a document (either | | | | | | | | | | | demonstrating approved zoning changes or that the project | | | | | | | | | | | is by-right) provides 5 points. | | | | | Market Analysis | | 10% | | | | 10 Points: where submission of a document provides 10 | | | | | Recommendation | | | | | | points. | | | | Construction Contract | | | 5% | | | 5 Points: where presence of a fixed cost and executed construction contract equals a higher score.

• 5 points: There is an executed fixed cost construction contract.
• 3 points: There is evidence of a construction contract that will be executed prior to closing.
• 0 points: There is no evidence of a construction contract. | 5 Points: where presence of a fixed cost and executed | | | | | | | | | | | construction contract equals a higher score. | | | | | | | | | | | | - 5 points: There is an executed fixed cost | | | | | | | | | | | construction contract. | | | | | | | | | | | - 3 points: There is evidence of a construction | | | | | | | | | | | contract that will be executed prior to closing. | | | | | | | | | | | - 0 points: There is no evidence of a construction | | | | | | | | | | | contract. | | | Sponsor Characteristics | | | 10% | | | 10 Points: where presence of additional Developer Experience can add up to 15 points:
• 10 points : 5 or more bond projects in Virginia in the past five calendar years
• 5 points: 1-4 bond projects in Virginia in the past five years
• 0 points: 0 projects in Virginia in the past five years | | | | Project Efficiency - 30% | | | | | | | | | | | | Cost per Unit | | | 10% | | | 10 Points: where a higher efficient use of resources (cost) score equals a higher score.
• 10 points: 80-100 score
• 5 points: 40-79 score
• 0 point: 0-39 score | 10 Points: where a higher efficient use of resources (cost) | | | | | | | | | | | score equals a higher score. | | | | | | | | | | | | - 10 points: 80-100 score | | | | | | | | | | | - 5 points: 40-79 score | | | | | | | | | | | - 0 point: 0-39 score | | | Other Resources Leveraged* | | | 10% | | | | 10 Points; where evidence of more eligible resources | | | | | | | | | | | leverage equated to a higher score: | | | | | | | | | | | 10 points: at least 2 other local, state, or federal resources | | | | | | | | | | | leveraged. | |

[/TABLE]

[TABLE 9-2] 10 Points: where presence of additional Developer | Experience can add up to 15 points: | | - 10 points : 5 or more bond projects in Virginia in | the past five calendar years | - 5 points: 1-4 bond projects in Virginia in the past | five years | - 0 points: 0 projects in Virginia in the past five years

[/TABLE]

[TABLE 9-3]

[/TABLE]

[TABLE 9-4] Other Resources Leveraged*

[/TABLE]

• Page 10 ---

5 points: at least one other local, state, or federal resources leveraged. 0 points: no other resources leveraged.

• this includes grant or loan funding provided by a local, state, federal or other entity. It does not include GP, sponsor loans, or deferred developer fees or other similar items. 10 Points: where a lesser proportion of the aggregate basis requested equals a higher score: 10 points: 50.01% - 50.99% aggregate basis requested.

1. 5 points: 51% - 51.99% aggregate basis requested.

Bond Request Size 10% 5 points: 52.00 – 52.99% aggregate basis requested.

1. 5 points: 53.00 – 53.99 aggregate basis requested. 0 points: 54.00 – 54.99% aggregate basis requested.

Threshold Criteria Must be met to receive allocation

TOTAL 100% _/100 Points

1. 6. Project Approval.

Upon scoring from DHCD and approval of PAB allocation authority, projects of local issuing authorities must be approved by the governing body having jurisdiction over the authority as well as by the governing body having jurisdiction over the locality in which the project is located. This is often the same governing body.

6. EFFECTIVE DATE OF SCORING CRITERIA

The Guidelines presented above will not go into effect until January 1, 2025, upon approval of the BHCD before that date and completion of a final 30 day public comment period.

10

[TABLE 10-1] | | | | | | | | 5 points: at least one other local, state, or federal resources | | | | | | | | | leveraged. | | | | | | | | | 0 points: no other resources leveraged. | | | | | | | | | *this includes grant or loan funding provided by a local, state, federal or | | | | | | | | | other entity. It does not include GP, sponsor loans, or deferred developer | | | | | | | | | fees or other similar items. | | | Bond Request Size | | 10% | | | | 10 Points: where a lesser proportion of the aggregate basis | | | | | | | | | requested equals a higher score: | | | | | | | | | 10 points: 50.01% - 50.99% aggregate basis requested. | | | | | | | | | 7.5 points: 51% - 51.99% aggregate basis requested. | | | | | | | | | 5 points: 52.00 – 52.99% aggregate basis requested. | | | | | | | | | 2.5 points: 53.00 – 53.99 aggregate basis requested. | | | | | | | | | 0 points: 54.00 – 54.99% aggregate basis requested. | Threshold Criteria | | | | Must be met to receive allocation | | | | | | TOTAL | | | | 100% | | | _/100 Points |

[/TABLE]

• Page 11 ---

APPENDIX A: JOB CREATION PER PLANNING DISTRICT COMMISSION:

In order to encourage projects in localities with high levels of economic development activity, DHCD will consider the ratio between the number of new jobs created in a Planning District Commission (PDC)

to its overall population. The formula is as follows:

𝑁𝑈𝑀𝐵𝐸𝑅 𝑂𝐹 𝐽𝑂𝐵𝑆 𝐶𝑅𝐸𝐴𝑇𝐸𝐷

𝐽𝑂𝐵 𝐶𝑅𝐸𝐴𝑇𝐼𝑂𝑁/𝑃𝐸𝑅𝑆𝑂𝑁 = 𝑇𝑂𝑇𝐴𝐿 𝑃𝐷𝐶 𝑃𝑂𝑃𝑈𝐿𝐴𝑇𝐼𝑂𝑁 Upon completing this calculation, DHCD will categorize localities by three categories:

• High Job Creation Levels (job creation/per capita > 0.001);
• Medium Job Creation Levels (0.001 > job creation/per capita > 0.000), and
• Low/No Job Creation Levels (job creation/per capita = 0.000 ).

Projects that are located in localities with “High” or “Medium” job creation levels will received additional points in the scoring of applications. Local categories are included in the following table.

Data for job creation is for the 2022 Calendar Year from the Virginia Economic Development Partnership Authority’s Virginia Announcements Database. Data for local population is from the Weldon Cooper Center as of July 1, 2022.

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• Page 12 ---

GOVA New Jobs Category – Locality PDC Jurisdiction Population Region Created PDC Accomack County 5 22 County 32,926 246 High Albemarle County 9 10 County 115,495 8 Low Alexandria City 7 8 City 158,128 0 High Alleghany County 2 5 County 14,898 0 Low Amelia County 3 14 County 13,263 0 None Amherst County 2 11 County 31,139 0 Low Appomattox County 2 11 County 16,534 130 Low Arlington County 7 8 County 241,283 1118 High Augusta County 8 6 County 77,758 500 Medium Bath County 8 6 County 4,228 0 Medium Bedford City 2 11 City 79,943 30 Low Bland County 1 3 County 6,295 0 Medium Botetourt County 2 5 County 33,510 0 Low

Bristol City 1 3 City 16,803 0 Medium Brunswick County 3 13 County 15,465 0 High Buchanan County 1 2 County 19,434 181 High Buckingham County 3 14 County 16,810 0 None Buena Vista City 8 6 City 6,647 0 Medium Campbell County 2 11 County 55,955 0 Low Caroline County 6 16 County 32,334 745 High Carroll County 1 3 County 28,809 0 Medium Charles City County 4 15 County 6,587 0 High Charlotte County 3 14 County 11,433 0 None Charlottesville City 9 10 City 51,278 0 Low

Chesapeake City 5 23 City 251,959 75 Low Chesterfield County 4 15 County 381,858 2212 High Clarke County 8 7 County 15,341 0 Low Colonial Heights City 4 15 City 18,040 0 High Covington City 2 5 City 5,650 0 Low Craig County 2 5 County 4,906 0 Low Culpeper County 9 9 County 54,089 0 Low Cumberland County 3 14 County 9,877 0 None Danville City 3 12 City 42,348 0 Medium Dickenson County 1 2 County 13,711 0 High Dinwiddie County 4 19 County 28,552 145 Low

Emporia City 4 19 City 5,657 0 Low Essex County 6 18 County 10,578 0 None Fairfax City 7 8 City 24,003 0 High Fairfax County 7 8 County 1,139,755 3237 High Falls Church City 7 8 City 14,566 0 High Fauquier County 9 9 County 73,536 0 Low Floyd County 2 4 County 15,160 15 Medium Fluvanna County 9 10 County 27,843 0 Low Franklin City 5 23 City 54,155 0 Low Franklin County 2 5 County 7,987 0 Low Fredrick County 8 7 County 94,871 37 Low

Fredericksburg City 6 16 City 27,667 0 High 12

[TABLE 12-1] Locality | GOVA Region | PDC | Jurisdiction | Population | New Jobs Created | Category – PDC Accomack County | 5 | 22 | County | 32,926 | 246 | High Albemarle County | 9 | 10 | County | 115,495 | 8 | Low Alexandria City | 7 | 8 | City | 158,128 | 0 | High Alleghany County | 2 | 5 | County | 14,898 | 0 | Low Amelia County | 3 | 14 | County | 13,263 | 0 | None Amherst County | 2 | 11 | County | 31,139 | 0 | Low Appomattox County | 2 | 11 | County | 16,534 | 130 | Low Arlington County | 7 | 8 | County | 241,283 | 1118 | High Augusta County | 8 | 6 | County | 77,758 | 500 | Medium Bath County | 8 | 6 | County | 4,228 | 0 | Medium Bedford City | 2 | 11 | City | 79,943 | 30 | Low Bland County | 1 | 3 | County | 6,295 | 0 | Medium Botetourt County | 2 | 5 | County | 33,510 | 0 | Low Bristol City | 1 | 3 | City | 16,803 | 0 | Medium Brunswick County | 3 | 13 | County | 15,465 | 0 | High Buchanan County | 1 | 2 | County | 19,434 | 181 | High Buckingham County | 3 | 14 | County | 16,810 | 0 | None Buena Vista City | 8 | 6 | City | 6,647 | 0 | Medium Campbell County | 2 | 11 | County | 55,955 | 0 | Low Caroline County | 6 | 16 | County | 32,334 | 745 | High Carroll County | 1 | 3 | County | 28,809 | 0 | Medium Charles City County | 4 | 15 | County | 6,587 | 0 | High Charlotte County | 3 | 14 | County | 11,433 | 0 | None Charlottesville City | 9 | 10 | City | 51,278 | 0 | Low Chesapeake City | 5 | 23 | City | 251,959 | 75 | Low Chesterfield County | 4 | 15 | County | 381,858 | 2212 | High Clarke County | 8 | 7 | County | 15,341 | 0 | Low Colonial Heights City | 4 | 15 | City | 18,040 | 0 | High Covington City | 2 | 5 | City | 5,650 | 0 | Low Craig County | 2 | 5 | County | 4,906 | 0 | Low Culpeper County | 9 | 9 | County | 54,089 | 0 | Low Cumberland County | 3 | 14 | County | 9,877 | 0 | None Danville City | 3 | 12 | City | 42,348 | 0 | Medium Dickenson County | 1 | 2 | County | 13,711 | 0 | High Dinwiddie County | 4 | 19 | County | 28,552 | 145 | Low Emporia City | 4 | 19 | City | 5,657 | 0 | Low Essex County | 6 | 18 | County | 10,578 | 0 | None Fairfax City | 7 | 8 | City | 24,003 | 0 | High Fairfax County | 7 | 8 | County | 1,139,755 | 3237 | High Falls Church City | 7 | 8 | City | 14,566 | 0 | High Fauquier County | 9 | 9 | County | 73,536 | 0 | Low Floyd County | 2 | 4 | County | 15,160 | 15 | Medium Fluvanna County | 9 | 10 | County | 27,843 | 0 | Low Franklin City | 5 | 23 | City | 54,155 | 0 | Low Franklin County | 2 | 5 | County | 7,987 | 0 | Low Fredrick County | 8 | 7 | County | 94,871 | 37 | Low Fredericksburg City | 6 | 16 | City | 27,667 | 0 | High

[/TABLE]

• Page 13 ---

GOVA New Jobs Category – Locality PDC Jurisdiction Population Region Created PDC Galax City 1 3 City 6,778 0 Medium Giles County 2 4 County 16,657 0 Medium Gloucester County 6 18 County 38,799 0 None Goochland County 4 15 County 26,183 0 High Grayson County 1 3 County 15,347 0 Medium Greene County 9 10 County 21,165 0 Low Greensville County 4 19 County 11,088 0 Low Halifax County 3 13 County 33,257 297 High Hampton City 5 23 City 136,387 0 Low Hanover County 4 15 County 112,409 502 High Harrisonburg City 8 6 City 55,700 0 Medium Henrico County 4 15 County 336,074 809 High Henry County 3 12 County 48,835 0 Medium

Highland County 8 6 County 2,234 0 Medium Hopewell City 4 19 City 22,657 0 Low Isle of Wight County 5 23 County 39,950 0 Low James City County 5 23 County 79,488 0 Low King and Queen County 6 18 County 6,663 0 None King George County 6 16 County 27,645 0 High King William County 6 18 County 18,107 0 None Lancaster County 6 17 County 10,757 0 None Lee County 1 1 County 21,699 0 None Lexington City 8 6 City 7,264 0 Medium Loudoun County 7 8 County 431,006 903 High

Louisa County 9 10 County 39,725 0 Low Lunenburg County 3 14 County 11,958 0 None Lynchburg City 2 11 City 80,127 0 Low Madison County 9 9 County 14,017 0 Low Manassas City 7 8 City 42,626 149 High Manassas Park City 7 8 City 17,277 0 High Martinsville City 3 12 City 13,234 0 Medium Mathews County 6 18 County 8,446 0 None Mecklenburg County 3 13 County 30,179 60 High Middlesex County 6 18 County 10,779 0 None Montgomery County 2 4 County 102,061 200 Medium

Nelson County 9 10 County 14,813 0 Low New Kent County 4 15 County 24,808 352 High Newport News City 5 23 City 183,504 64 Low Norfolk City 5 23 County 237,770 355 Low Northampton County 5 22 County 12,039 0 High Northumberland County 6 17 County 11,778 0 None Norton City 1 1 City 3,638 0 None Nottoway County 3 14 County 15,608 0 None Orange County 9 9 County 37,109 10 Low Page County 8 7 County 23,374 0 Low Patrick County 3 12 County 17,080 0 Medium

Petersburg City 4 19 City 33,466 10 Low 13

[TABLE 13-1] Locality | GOVA Region | PDC | Jurisdiction | Population | New Jobs Created | Category – PDC Galax City | 1 | 3 | City | 6,778 | 0 | Medium Giles County | 2 | 4 | County | 16,657 | 0 | Medium Gloucester County | 6 | 18 | County | 38,799 | 0 | None Goochland County | 4 | 15 | County | 26,183 | 0 | High Grayson County | 1 | 3 | County | 15,347 | 0 | Medium Greene County | 9 | 10 | County | 21,165 | 0 | Low Greensville County | 4 | 19 | County | 11,088 | 0 | Low Halifax County | 3 | 13 | County | 33,257 | 297 | High Hampton City | 5 | 23 | City | 136,387 | 0 | Low Hanover County | 4 | 15 | County | 112,409 | 502 | High Harrisonburg City | 8 | 6 | City | 55,700 | 0 | Medium Henrico County | 4 | 15 | County | 336,074 | 809 | High Henry County | 3 | 12 | County | 48,835 | 0 | Medium Highland County | 8 | 6 | County | 2,234 | 0 | Medium Hopewell City | 4 | 19 | City | 22,657 | 0 | Low Isle of Wight County | 5 | 23 | County | 39,950 | 0 | Low James City County | 5 | 23 | County | 79,488 | 0 | Low King and Queen County | 6 | 18 | County | 6,663 | 0 | None King George County | 6 | 16 | County | 27,645 | 0 | High King William County | 6 | 18 | County | 18,107 | 0 | None Lancaster County | 6 | 17 | County | 10,757 | 0 | None Lee County | 1 | 1 | County | 21,699 | 0 | None Lexington City | 8 | 6 | City | 7,264 | 0 | Medium Loudoun County | 7 | 8 | County | 431,006 | 903 | High Louisa County | 9 | 10 | County | 39,725 | 0 | Low Lunenburg County | 3 | 14 | County | 11,958 | 0 | None Lynchburg City | 2 | 11 | City | 80,127 | 0 | Low Madison County | 9 | 9 | County | 14,017 | 0 | Low Manassas City | 7 | 8 | City | 42,626 | 149 | High Manassas Park City | 7 | 8 | City | 17,277 | 0 | High Martinsville City | 3 | 12 | City | 13,234 | 0 | Medium Mathews County | 6 | 18 | County | 8,446 | 0 | None Mecklenburg County | 3 | 13 | County | 30,179 | 60 | High Middlesex County | 6 | 18 | County | 10,779 | 0 | None Montgomery County | 2 | 4 | County | 102,061 | 200 | Medium Nelson County | 9 | 10 | County | 14,813 | 0 | Low New Kent County | 4 | 15 | County | 24,808 | 352 | High Newport News City | 5 | 23 | City | 183,504 | 64 | Low Norfolk City | 5 | 23 | County | 237,770 | 355 | Low Northampton County | 5 | 22 | County | 12,039 | 0 | High Northumberland County | 6 | 17 | County | 11,778 | 0 | None Norton City | 1 | 1 | City | 3,638 | 0 | None Nottoway County | 3 | 14 | County | 15,608 | 0 | None Orange County | 9 | 9 | County | 37,109 | 10 | Low Page County | 8 | 7 | County | 23,374 | 0 | Low Patrick County | 3 | 12 | County | 17,080 | 0 | Medium Petersburg City | 4 | 19 | City | 33,466 | 10 | Low

[/TABLE]

• Page 14 ---

GOVA New Jobs Category – Locality PDC Jurisdiction Population Region Created PDC Pittsylvania County 3 12 County 59,366 218 Medium Poquoson City 5 23 City 12,624 0 Low Portsmouth City 5 23 City 96,700 0 Low Powhatan County 4 15 County 31,365 0 High Prince Edward County 3 14 County 21,956 0 None Prince George County 4 19 County 43,295 0 Low Prince William County 7 8 County 490,325 185 High Pulaski County 2 4 County 33,571 0 Medium Radford City 2 4 City 16,835 0 Medium Rappahannock County 9 9 County 7,394 0 Low Richmond City 4 15 City 226,967 0 None Richmond County 6 17 County 9,165 387 High Roanoke City 2 5 City 99,634 20 Low

Roanoke County 2 5 County 96,605 0 Low Rockbridge County 8 6 County 22,498 0 Medium Rockingham County 8 6 County 84,149 0 Medium Russell County 1 2 County 25,338 50 High Salem City 2 5 City 24,924 0 Low Scott County 1 1 County 21,309 0 None Shenandoah County 8 7 County 44,541 0 Low Smyth County 1 3 County 29,025 75 Medium Southampton County 5 23 County 17,913 0 Low Spotsylvania County 6 16 County 145,013 0 High Stafford County 6 16 County 163,239 103 High

Staunton City 8 6 City 25,773 0 Medium Suffolk City 5 23 City 99,179 362 Low Surry County 4 19 County 6,492 0 Low Sussex County 4 19 County 10,388 5 Low Tazewell County 1 2 County 39,470 88 High Virginia Beach City 5 23 City 455,385 525 Low Warren County 8 7 County 41,280 100 Low Washington County 1 3 County 53,723 250 Medium Waynesboro City 8 6 City 22,537 6 Medium Westmoreland County 6 17 County 18,760 0 None Williamsburg City 5 23 City 16,224 0 Low

Winchester City 8 7 City 28,417 45 Low Wise County 1 1 County 35,515 0 None Wythe County 1 3 County 27,941 0 Medium York County 5 23 County 71,491 0 Low

14

[TABLE 14-1] Locality | GOVA Region | PDC | Jurisdiction | Population | New Jobs Created | Category – PDC Pittsylvania County | 3 | 12 | County | 59,366 | 218 | Medium Poquoson City | 5 | 23 | City | 12,624 | 0 | Low Portsmouth City | 5 | 23 | City | 96,700 | 0 | Low Powhatan County | 4 | 15 | County | 31,365 | 0 | High Prince Edward County | 3 | 14 | County | 21,956 | 0 | None Prince George County | 4 | 19 | County | 43,295 | 0 | Low Prince William County | 7 | 8 | County | 490,325 | 185 | High Pulaski County | 2 | 4 | County | 33,571 | 0 | Medium Radford City | 2 | 4 | City | 16,835 | 0 | Medium Rappahannock County | 9 | 9 | County | 7,394 | 0 | Low Richmond City | 4 | 15 | City | 226,967 | 0 | None Richmond County | 6 | 17 | County | 9,165 | 387 | High Roanoke City | 2 | 5 | City | 99,634 | 20 | Low Roanoke County | 2 | 5 | County | 96,605 | 0 | Low Rockbridge County | 8 | 6 | County | 22,498 | 0 | Medium Rockingham County | 8 | 6 | County | 84,149 | 0 | Medium Russell County | 1 | 2 | County | 25,338 | 50 | High Salem City | 2 | 5 | City | 24,924 | 0 | Low Scott County | 1 | 1 | County | 21,309 | 0 | None Shenandoah County | 8 | 7 | County | 44,541 | 0 | Low Smyth County | 1 | 3 | County | 29,025 | 75 | Medium Southampton County | 5 | 23 | County | 17,913 | 0 | Low Spotsylvania County | 6 | 16 | County | 145,013 | 0 | High Stafford County | 6 | 16 | County | 163,239 | 103 | High Staunton City | 8 | 6 | City | 25,773 | 0 | Medium Suffolk City | 5 | 23 | City | 99,179 | 362 | Low Surry County | 4 | 19 | County | 6,492 | 0 | Low Sussex County | 4 | 19 | County | 10,388 | 5 | Low Tazewell County | 1 | 2 | County | 39,470 | 88 | High Virginia Beach City | 5 | 23 | City | 455,385 | 525 | Low Warren County | 8 | 7 | County | 41,280 | 100 | Low Washington County | 1 | 3 | County | 53,723 | 250 | Medium Waynesboro City | 8 | 6 | City | 22,537 | 6 | Medium Westmoreland County | 6 | 17 | County | 18,760 | 0 | None Williamsburg City | 5 | 23 | City | 16,224 | 0 | Low Winchester City | 8 | 7 | City | 28,417 | 45 | Low Wise County | 1 | 1 | County | 35,515 | 0 | None Wythe County | 1 | 3 | County | 27,941 | 0 | Medium York County | 5 | 23 | County | 71,491 | 0 | Low

[/TABLE]

• Page 15 ---

APPENDIX B: RENTER COST BURDEN PER LOCALITY:

In order to encourage projects in localities with high levels of housing need, DHCD will consider the degree to which a locality’s renter population is cost burdened compared to all other localities. This comparison is done by creating a normal distribution, where a locality’s degree of renter cost burden is compared to the state average.

𝑆𝑇𝐴𝑇𝐸𝑊𝐼𝐷𝐸 𝐴𝑉𝐸𝑅𝐴𝐺𝐸 𝐶𝑂𝑆𝑇 𝐵𝑈𝑅𝐷𝐸𝑁 − 𝐿𝑂𝐶𝐴𝐿𝐼𝑇𝑌 𝐶𝑂𝑆𝑇 𝐵𝑈𝑅𝐷𝐸𝑁

𝑅𝐸𝑁𝑇𝐸𝑅 𝐶𝑂𝑆𝑇 𝐵𝑈𝑅𝐷𝐸𝑁 𝑆𝐶𝑂𝑅𝐸 = 𝑆𝑇𝐴𝑇𝐸𝑊𝐼𝐷𝐸 𝑆𝑇𝐴𝑁𝐷𝐴𝑅𝐷 𝐷𝐸𝑉𝐼𝐴𝑇𝐼𝑂𝑁 𝑂𝐹 𝐶𝑂𝑆𝑇 𝐵𝑈𝑅𝐷𝐸𝑁 Upon completing this calculation, DHCD categorized localities by four categories, where higher scores equate to greater renter cost burden:

• High Cost Burden = Renter cost burden one standard deviation or more above the statewide average (Renter Cost Burden > 47%);
• Above Average Cost Burden = Renter cost burden within standard deviation above statewide average (47% > Renter Cost Burden > 39%);
• Below Average Cost Burden = Renter cost burden within standard deviation below statewide average (39% > Renter Cost Burden > 31%);
• Low Cost Burden = Renter cost burden one standard deviation below or more than the statewide average (Renter Cost Burden < 31%);

Projects that are located in localities with higher cost burden levels will receive additional points in the scoring of applications. Local categories are included in the following table.

Data for housing cost burden is from the American Community Survey from 2027-2021. “Cost Burdened” is defined as any household who pays more than 30% of their gross income on rent. Values are as a percent of total renter population.

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• Page 16 ---

Renter Cost Renter Cost GOVA Juris- Renter Cost Locality PDC Burden Burden Region diction Burden Score Category Accomack County 5 22 County 34.23% 96.87 Below Average Albemarle County 9 10 County 43.29% 102.45 Above Average Alexandria City 7 8 City 42.92% 102.22 Above Average Alleghany County 2 5 County 33.44% 96.39 Below Average Amelia County 3 14 County 48.65% 105.75 High Amherst County 2 11 County 38.07% 99.24 Below Average Appomattox County 2 11 County 37.03% 98.60 Below Average Arlington County 7 8 County 37.02% 98.59 Below Average Augusta County 8 6 County 35.20% 97.47 Below Average Bath County 8 6 County 23.02% 89.97 Low Bedford City 2 11 City 39.52% 100.13 Above Average Bland County 1 3 County 37.33% 98.79 Below Average Botetourt County 2 5 County 24.61% 90.95 Low Bristol City 1 3 City 42.15% 101.75 Above Average Brunswick County 3 13 County 38.41% 99.45 Below Average Buchanan County 1 2 County 31.70% 95.32 Below Average

Buckingham County 3 14 County 40.63% 100.82 Above Average Buena Vista City 8 6 City 51.16% 107.30 High Campbell County 2 11 County 32.74% 95.96 Below Average Caroline County 6 16 County 45.25% 103.66 Above Average Carroll County 1 3 County 33.79% 96.60 Below Average Charles City County 4 15 County 43.46% 102.56 Above Average Charlotte County 3 14 County 40.75% 100.89 Above Average

Charlottesville City 9 10 City 51.35% 107.41 High Chesapeake City 5 23 City 51.72% 107.64 High Chesterfield County 4 15 County 45.81% 104.00 Above Average Clarke County 8 7 County 56.76% 110.75 High Colonial Heights City 4 15 City 59.66% 112.53 High Covington City 2 5 City 26.48% 92.11 Low

Craig County 2 5 County 24.54% 90.91 Low Culpeper County 9 9 County 39.96% 100.40 Above Average Cumberland County 3 14 County 26.42% 92.07 Low Danville City 3 12 City 42.62% 102.04 Above Average Dickenson County 1 2 County 38.35% 99.41 Below Average Dinwiddie County 4 19 County 32.49% 95.80 Below Average Emporia City 4 19 City 43.70% 102.71 Above Average

Essex County 6 18 County 49.86% 106.50 High Fairfax City 7 8 City 48.82% 105.85 High Fairfax County 7 8 County 44.50% 103.19 Above Average Falls Church City 7 8 City 34.57% 97.08 Below Average Fauquier County 9 9 County 34.02% 96.74 Below Average Floyd County 2 4 County 36.00% 97.97 Below Average

16

[TABLE 16-1] Locality | GOVA Region | PDC | Juris-diction | Renter Cost Burden | Renter Cost Burden Score | Renter Cost Burden Category Accomack County | 5 | 22 | County | 34.23% | 96.87 | Below Average Albemarle County | 9 | 10 | County | 43.29% | 102.45 | Above Average Alexandria City | 7 | 8 | City | 42.92% | 102.22 | Above Average Alleghany County | 2 | 5 | County | 33.44% | 96.39 | Below Average Amelia County | 3 | 14 | County | 48.65% | 105.75 | High Amherst County | 2 | 11 | County | 38.07% | 99.24 | Below Average Appomattox County | 2 | 11 | County | 37.03% | 98.60 | Below Average Arlington County | 7 | 8 | County | 37.02% | 98.59 | Below Average Augusta County | 8 | 6 | County | 35.20% | 97.47 | Below Average Bath County | 8 | 6 | County | 23.02% | 89.97 | Low Bedford City | 2 | 11 | City | 39.52% | 100.13 | Above Average Bland County | 1 | 3 | County | 37.33% | 98.79 | Below Average Botetourt County | 2 | 5 | County | 24.61% | 90.95 | Low Bristol City | 1 | 3 | City | 42.15% | 101.75 | Above Average Brunswick County | 3 | 13 | County | 38.41% | 99.45 | Below Average Buchanan County | 1 | 2 | County | 31.70% | 95.32 | Below Average Buckingham County | 3 | 14 | County | 40.63% | 100.82 | Above Average Buena Vista City | 8 | 6 | City | 51.16% | 107.30 | High Campbell County | 2 | 11 | County | 32.74% | 95.96 | Below Average Caroline County | 6 | 16 | County | 45.25% | 103.66 | Above Average Carroll County | 1 | 3 | County | 33.79% | 96.60 | Below Average Charles City County | 4 | 15 | County | 43.46% | 102.56 | Above Average Charlotte County | 3 | 14 | County | 40.75% | 100.89 | Above Average Charlottesville City | 9 | 10 | City | 51.35% | 107.41 | High Chesapeake City | 5 | 23 | City | 51.72% | 107.64 | High Chesterfield County | 4 | 15 | County | 45.81% | 104.00 | Above Average Clarke County | 8 | 7 | County | 56.76% | 110.75 | High Colonial Heights City | 4 | 15 | City | 59.66% | 112.53 | High Covington City | 2 | 5 | City | 26.48% | 92.11 | Low Craig County | 2 | 5 | County | 24.54% | 90.91 | Low Culpeper County | 9 | 9 | County | 39.96% | 100.40 | Above Average Cumberland County | 3 | 14 | County | 26.42% | 92.07 | Low Danville City | 3 | 12 | City | 42.62% | 102.04 | Above Average Dickenson County | 1 | 2 | County | 38.35% | 99.41 | Below Average Dinwiddie County | 4 | 19 | County | 32.49% | 95.80 | Below Average Emporia City | 4 | 19 | City | 43.70% | 102.71 | Above Average Essex County | 6 | 18 | County | 49.86% | 106.50 | High Fairfax City | 7 | 8 | City | 48.82% | 105.85 | High Fairfax County | 7 | 8 | County | 44.50% | 103.19 | Above Average Falls Church City | 7 | 8 | City | 34.57% | 97.08 | Below Average Fauquier County | 9 | 9 | County | 34.02% | 96.74 | Below Average Floyd County | 2 | 4 | County | 36.00% | 97.97 | Below Average

[/TABLE]

• Page 17 ---

Renter Cost Renter Cost GOVA Juris- Renter Cost Locality PDC Burden Burden Region diction Burden Score Category Fluvanna County 9 10 County 20.11% 88.18 Low Franklin City 5 23 City 47.31% 104.93 Above Average Franklin County 2 5 County 36.02% 97.97 Below Average Fredrick County 8 7 County 36.54% 98.29 Below Average Fredericksburg City 6 16 City 44.73% 103.34 Above Average Galax City 1 3 City 39.40% 100.06 Above Average Giles County 2 4 County 30.32% 94.47 Low Gloucester County 6 18 County 40.30% 100.61 Above Average Goochland County 4 15 County 31.61% 95.26 Below Average Grayson County 1 3 County 30.03% 94.29 Low Greene County 9 10 County 26.10% 91.87 Low Greensville County 4 19 County 38.63% 99.58 Below Average Halifax County 3 13 County 43.18% 102.39 Above Average Hampton City 5 23 City 52.53% 108.14 High Hanover County 4 15 County 40.91% 100.99 Above Average Harrisonburg City 8 6 City 43.98% 102.87 Above Average

Henrico County 4 15 County 47.64% 105.13 High Henry County 3 12 County 38.31% 99.39 Below Average Highland County 8 6 County 29.88% 94.20 Low Hopewell City 4 19 City 45.91% 104.06 Above Average Isle of Wight County 5 23 County 36.67% 98.38 Below Average James City County 5 23 County 46.35% 104.33 Above Average King and Queen County 6 18 County 24.95% 91.16 Low

King George County 6 16 County 47.07% 104.78 Above Average King William County 6 18 County 33.26% 96.28 Below Average Lancaster County 6 17 County 37.94% 99.16 Below Average Lee County 1 1 County 39.66% 100.22 Above Average Lexington City 8 6 City 48.49% 105.65 High Loudoun County 7 8 County 41.41% 101.29 Above Average

Louisa County 9 10 County 46.59% 104.48 Above Average Lunenburg County 3 14 County 34.10% 96.80 Below Average Lynchburg City 2 11 City 45.23% 103.65 Above Average Madison County 9 9 County 33.30% 96.30 Below Average Manassas City 7 8 City 51.59% 107.56 High Manassas Park City 7 8 City 58.94% 112.09 High Martinsville City 3 12 City 40.93% 101.00 Above Average

Mathews County 6 18 County 34.57% 97.09 Below Average Mecklenburg County 3 13 County 36.18% 98.07 Below Average Middlesex County 6 18 County 36.69% 98.39 Below Average Montgomery County 2 4 County 44.61% 103.27 Above Average Nelson County 9 10 County 29.21% 93.79 Low New Kent County 4 15 County 54.06% 109.08 High

17

[TABLE 17-1] Locality | GOVA Region | PDC | Juris-diction | Renter Cost Burden | Renter Cost Burden Score | Renter Cost Burden Category Fluvanna County | 9 | 10 | County | 20.11% | 88.18 | Low Franklin City | 5 | 23 | City | 47.31% | 104.93 | Above Average Franklin County | 2 | 5 | County | 36.02% | 97.97 | Below Average Fredrick County | 8 | 7 | County | 36.54% | 98.29 | Below Average Fredericksburg City | 6 | 16 | City | 44.73% | 103.34 | Above Average Galax City | 1 | 3 | City | 39.40% | 100.06 | Above Average Giles County | 2 | 4 | County | 30.32% | 94.47 | Low Gloucester County | 6 | 18 | County | 40.30% | 100.61 | Above Average Goochland County | 4 | 15 | County | 31.61% | 95.26 | Below Average Grayson County | 1 | 3 | County | 30.03% | 94.29 | Low Greene County | 9 | 10 | County | 26.10% | 91.87 | Low Greensville County | 4 | 19 | County | 38.63% | 99.58 | Below Average Halifax County | 3 | 13 | County | 43.18% | 102.39 | Above Average Hampton City | 5 | 23 | City | 52.53% | 108.14 | High Hanover County | 4 | 15 | County | 40.91% | 100.99 | Above Average Harrisonburg City | 8 | 6 | City | 43.98% | 102.87 | Above Average Henrico County | 4 | 15 | County | 47.64% | 105.13 | High Henry County | 3 | 12 | County | 38.31% | 99.39 | Below Average Highland County | 8 | 6 | County | 29.88% | 94.20 | Low Hopewell City | 4 | 19 | City | 45.91% | 104.06 | Above Average Isle of Wight County | 5 | 23 | County | 36.67% | 98.38 | Below Average James City County | 5 | 23 | County | 46.35% | 104.33 | Above Average King and Queen County | 6 | 18 | County | 24.95% | 91.16 | Low King George County | 6 | 16 | County | 47.07% | 104.78 | Above Average King William County | 6 | 18 | County | 33.26% | 96.28 | Below Average Lancaster County | 6 | 17 | County | 37.94% | 99.16 | Below Average Lee County | 1 | 1 | County | 39.66% | 100.22 | Above Average Lexington City | 8 | 6 | City | 48.49% | 105.65 | High Loudoun County | 7 | 8 | County | 41.41% | 101.29 | Above Average Louisa County | 9 | 10 | County | 46.59% | 104.48 | Above Average Lunenburg County | 3 | 14 | County | 34.10% | 96.80 | Below Average Lynchburg City | 2 | 11 | City | 45.23% | 103.65 | Above Average Madison County | 9 | 9 | County | 33.30% | 96.30 | Below Average Manassas City | 7 | 8 | City | 51.59% | 107.56 | High Manassas Park City | 7 | 8 | City | 58.94% | 112.09 | High Martinsville City | 3 | 12 | City | 40.93% | 101.00 | Above Average Mathews County | 6 | 18 | County | 34.57% | 97.09 | Below Average Mecklenburg County | 3 | 13 | County | 36.18% | 98.07 | Below Average Middlesex County | 6 | 18 | County | 36.69% | 98.39 | Below Average Montgomery County | 2 | 4 | County | 44.61% | 103.27 | Above Average Nelson County | 9 | 10 | County | 29.21% | 93.79 | Low New Kent County | 4 | 15 | County | 54.06% | 109.08 | High

[/TABLE]

• Page 18 ---

Renter Cost Renter Cost GOVA Juris- Renter Cost Locality PDC Burden Burden Region diction Burden Score Category Newport News City 5 23 City 48.40% 105.60 High Norfolk City 5 23 County 49.39% 106.21 High Northampton County 5 22 County 27.86% 92.95 Low Northumberland County 6 17 County 30.96% 94.86 Low Norton City 1 1 City 43.91% 102.83 Above Average Nottoway County 3 14 County 31.19% 95.00 Below Average Orange County 9 9 County 32.84% 96.02 Below Average Page County 8 7 County 35.51% 97.66 Below Average Patrick County 3 12 County 29.74% 94.11 Low Petersburg City 4 19 City 45.64% 103.90 Above Average Pittsylvania County 3 12 County 40.77% 100.90 Above Average Poquoson City 5 23 City 21.56% 89.07 Low Portsmouth City 5 23 City 51.95% 107.79 High Powhatan County 4 15 County 40.42% 100.68 Above Average Prince Edward County 3 14 County 41.03% 101.06 Above Average Prince George County 4 19 County 42.47% 101.95 Above Average

Prince William County 7 8 County 46.56% 104.46 Above Average Pulaski County 2 4 County 32.60% 95.87 Below Average Radford City 2 4 City 47.44% 105.01 High Rappahannock County 9 9 County 28.71% 93.47 Low Richmond City 4 15 City 50.21% 106.72 High Richmond County 6 17 County 32.82% 96.01 Below Average Roanoke City 2 5 City 44.22% 103.03 Above Average

Roanoke County 2 5 County 42.76% 102.12 Above Average Rockbridge County 8 6 County 32.83% 96.01 Below Average Rockingham County 8 6 County 32.24% 95.65 Below Average Russell County 1 2 County 29.96% 94.25 Low Salem City 2 5 City 37.80% 99.07 Below Average Scott County 1 1 County 26.75% 92.27 Low

Shenandoah County 8 7 County 35.78% 97.83 Below Average Smyth County 1 3 County 39.56% 100.16 Above Average Southampton County 5 23 County 32.92% 96.07 Below Average Spotsylvania County 6 16 County 45.61% 103.88 Above Average Stafford County 6 16 County 43.37% 102.50 Above Average Staunton City 8 6 City 45.63% 103.90 Above Average Suffolk City 5 23 City 51.98% 107.80 High

Surry County 4 19 County 31.15% 94.98 Low Sussex County 4 19 County 38.48% 99.49 Below Average Tazewell County 1 2 County 33.32% 96.31 Below Average Virginia Beach City 5 23 City 46.79% 104.61 Above Average Warren County 8 7 County 37.79% 99.07 Below Average Washington County 1 3 County 28.28% 93.21 Low

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[TABLE 18-1] Locality | GOVA Region | PDC | Juris-diction | Renter Cost Burden | Renter Cost Burden Score | Renter Cost Burden Category Newport News City | 5 | 23 | City | 48.40% | 105.60 | High Norfolk City | 5 | 23 | County | 49.39% | 106.21 | High Northampton County | 5 | 22 | County | 27.86% | 92.95 | Low Northumberland County | 6 | 17 | County | 30.96% | 94.86 | Low Norton City | 1 | 1 | City | 43.91% | 102.83 | Above Average Nottoway County | 3 | 14 | County | 31.19% | 95.00 | Below Average Orange County | 9 | 9 | County | 32.84% | 96.02 | Below Average Page County | 8 | 7 | County | 35.51% | 97.66 | Below Average Patrick County | 3 | 12 | County | 29.74% | 94.11 | Low Petersburg City | 4 | 19 | City | 45.64% | 103.90 | Above Average Pittsylvania County | 3 | 12 | County | 40.77% | 100.90 | Above Average Poquoson City | 5 | 23 | City | 21.56% | 89.07 | Low Portsmouth City | 5 | 23 | City | 51.95% | 107.79 | High Powhatan County | 4 | 15 | County | 40.42% | 100.68 | Above Average Prince Edward County | 3 | 14 | County | 41.03% | 101.06 | Above Average Prince George County | 4 | 19 | County | 42.47% | 101.95 | Above Average Prince William County | 7 | 8 | County | 46.56% | 104.46 | Above Average Pulaski County | 2 | 4 | County | 32.60% | 95.87 | Below Average Radford City | 2 | 4 | City | 47.44% | 105.01 | High Rappahannock County | 9 | 9 | County | 28.71% | 93.47 | Low Richmond City | 4 | 15 | City | 50.21% | 106.72 | High Richmond County | 6 | 17 | County | 32.82% | 96.01 | Below Average Roanoke City | 2 | 5 | City | 44.22% | 103.03 | Above Average Roanoke County | 2 | 5 | County | 42.76% | 102.12 | Above Average Rockbridge County | 8 | 6 | County | 32.83% | 96.01 | Below Average Rockingham County | 8 | 6 | County | 32.24% | 95.65 | Below Average Russell County | 1 | 2 | County | 29.96% | 94.25 | Low Salem City | 2 | 5 | City | 37.80% | 99.07 | Below Average Scott County | 1 | 1 | County | 26.75% | 92.27 | Low Shenandoah County | 8 | 7 | County | 35.78% | 97.83 | Below Average Smyth County | 1 | 3 | County | 39.56% | 100.16 | Above Average Southampton County | 5 | 23 | County | 32.92% | 96.07 | Below Average Spotsylvania County | 6 | 16 | County | 45.61% | 103.88 | Above Average Stafford County | 6 | 16 | County | 43.37% | 102.50 | Above Average Staunton City | 8 | 6 | City | 45.63% | 103.90 | Above Average Suffolk City | 5 | 23 | City | 51.98% | 107.80 | High Surry County | 4 | 19 | County | 31.15% | 94.98 | Low Sussex County | 4 | 19 | County | 38.48% | 99.49 | Below Average Tazewell County | 1 | 2 | County | 33.32% | 96.31 | Below Average Virginia Beach City | 5 | 23 | City | 46.79% | 104.61 | Above Average Warren County | 8 | 7 | County | 37.79% | 99.07 | Below Average Washington County | 1 | 3 | County | 28.28% | 93.21 | Low

[/TABLE]

• Page 19 ---

Renter Cost Renter Cost GOVA Juris- Renter Cost Locality PDC Burden Burden Region diction Burden Score Category Waynesboro City 8 6 City 49.27% 106.14 High Westmoreland County 6 17 County 42.75% 102.12 Above Average Williamsburg City 5 23 City 47.49% 105.04 High Winchester City 8 7 City 43.52% 102.59 Above Average Wise County 1 1 County 34.16% 96.83 Below Average Wythe County 1 3 County 28.34% 93.25 Low York County 5 23 County 45.79% 103.99 Above Average

19

[TABLE 19-1] Locality | GOVA Region | PDC | Juris-diction | Renter Cost Burden | Renter Cost Burden Score | Renter Cost Burden Category Waynesboro City | 8 | 6 | City | 49.27% | 106.14 | High Westmoreland County | 6 | 17 | County | 42.75% | 102.12 | Above Average Williamsburg City | 5 | 23 | City | 47.49% | 105.04 | High Winchester City | 8 | 7 | City | 43.52% | 102.59 | Above Average Wise County | 1 | 1 | County | 34.16% | 96.83 | Below Average Wythe County | 1 | 3 | County | 28.34% | 93.25 | Low York County | 5 | 23 | County | 45.79% | 103.99 | Above Average

[/TABLE]

• Page 1 ---

Virginia Private Activity Bond Allocation Guidelines

Local Housing Authority (LHA) Allocation

Adopted: May 13, 2024 Effective Date: January 1, 2025

TABLE OF CONTENTS

I DEFINITIONS

1. 1. Definitions

II PROGRAM OVERVIEW

1. 1. Introduction
2. 2. Availability of Bonds
3. 3. Allocation Size Limits
4. 4. Carryforward Allocation.

III ELIGIBILITY

1. 1. Eligible Use of Funds
2. 2. Threshold Requirements
3. 3. Effective Period of Allocation
4. 4. State Guidelines to Change as Federal Law Determines Eligibility

IV ADDITIONAL CRITERIA

1. 1. Reporting Requirements for Allocations

V APPLICATION REVIEW AND EVALUATION

1. 1. Dates and Submission Timeline
2. 2. Scoring Criteria
3. 3. Other Scoring Criteria
4. 4. Tiebreaker Criteria
5. 5. Scoring Rubric
6. 6. Project Approval

VI EFFECTIVE PERIOD OF GUIDELINES

VII APPENDIXES

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1. DEFINITIONS

1. 1. Definitions

A. Section 15.2-5000 of the Code of Virginia defines terms used in these Guidelines:

• “Exempt project”
• “Industrial development bond”
• “Local housing authority”
• “Manufacturing facility”
• "Manufactured housing bond”
• “Private activity bond”

• “Single family housing bond”
• “State ceiling”

B. The following words and terms, unless the context indicates otherwise, shall have the following meanings:

"Allocation" or "award" means the notice from the Commonwealth providing a project with a specified amount from the state ceiling for a bond issue.

“Applicant” means an entity submitting an application for private activity bond authority per these Guidelines.

"Carryforward purpose" means projects eligible for allocation in one year and bond issuance in a later year under § 146 of the IRC.

“Consolidated plan” is HUD-required plan for jurisdictions receiving funding from CDBG, HOME, ESG, and Housing Opportunities for Persons with

AIDS (HOPWA).

“DHCD” means Department of Housing and Community Development.

“Eligibility” means applicant's project rents, restricted by the Code, meet rent affordability standards via low-income housing tax credits under Section 42 or other federal, state, or local programs with enforceable rent standards.

DHCD may waive this eligibility requirement for projects addressing other compelling local or state objectives.

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"Governing body" means the board of supervisors of each county and the council of each city and of each town.

"Housing bonds" means multifamily housing bonds and single family housing bonds requiring allocation from the state ceiling.

"IRC” means the Internal Revenue Code of 1986, as amended.

"Issued" means that the PABs have been issued in accordance with IRC §§103 and 141-150.

"Issuing authority" means any political subdivision, governmental unit, authority, or other entity of the Commonwealth which is empowered to issue PABs.

"Locality" means a city, town, or county of the Commonwealth.

"Multifamily housing bond" means any obligation which constitutes an exempt facility bond under federal law for the financing of a qualified residential rental project within the meaning of § 142 of the Code.

"Population" means the most recent estimate of resident population for Virginia and the counties, cities, and towns published by the United States Bureau of the Census or the Weldon Cooper Center for Public Service of the University of Virginia before January 1 of each calendar year.

"Project" means the facility (as described in the application) proposed to be financed, in whole or in part, by an issue of bonds and that meets all of the requirements for eligibility set forth in these Guidelines.

“Rent affordability standards” mean rent and utility costs (excluding telephone) do not exceed 30% of applicable income limits under the Code during bond maturity.

"State Allocation" means the portion of the state ceiling set aside for projects of state issuing authorities and for projects of state or regional interest as determined by the Governor.

A “Supplemental allocation” is additional PABs for a previously closed project, not for a separate development phase, regardless of issuer.

2. PROGRAM OVERVIEW

1. 1. Introduction

Virginia annually issues tax-exempt bonds, called PABs, to finance projects classified as “qualified private activities” under the IRC.

Chapter 50 (§§ 15.2-5000 through 15.2-5005) of Title 15.2 of the Code of Virginia sets aside specified amounts of the Commonwealth's limited PAB issuing authority into four allocation pools. This Chapter requires the Department of Housing and Community Development (DHCD), through the Board of

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DHCD shall establish guidelines detailing policies, criteria, procedures for allocating to local housing authorities and other responsibilities, per this chapter.

DHCD will allocate PAB authority from the local housing authority allocation per these guidelines. DHCD's responsibilities include:

A. Determining the annual state ceiling on PABs beyond 2008 based on federal per capita limits and population.

B. Setting aside the appropriate portion of the state ceiling for each project type as specified in § 15.2-5002 of the Code of Virginia annually beyond 2008.

C. Receiving and reviewing project applications for PAB authority from the local housing allocated portion.

D. Allocating PAB authority to projects requesting bond authority from the local housing portion.

1. 2. Availability of Bonds

PAB allocation is based on federal per capita limits; § 15.2-5002 reserves 14% for local housing authorities. DHCD reviews and allocates PABs to qualified projects.

Annual PAB availability is posted on DHCD's website. Funding occurs in two competitive rounds, with a possible third non-competitive round if funds remain.

DHCD reserves at least 50% of PABs for the second and potential third round. Unused allocations from earlier rounds carry over automatically.

1. 3. Allocation Size Limits

In Round 1, applicants may request up to $20 million per project; no cap exists for Round 2 or optional Round 3.

Projects are limited to one allocation per year. However, an applicant

may reapply if not allocated in a prior round.

Projects not allocated in rounds 1 or 2 are automatically reconsidered if materials are current and applications are unchanged or similar; substantive changes require a new application.

1. 4. Carryforward Allocation

Around December 15, DHCD will notify VHDA of remaining bond authority. VHDA must then submit a written request to DHCD to

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transfer bond authority to VHDA; unrequested remaining authority reverts to DHCD for other uses.

3. ELIGIBILITY

1. 1. Eligible Use of Funds

Entities seeking bond authority for affordable housing projects that meet rent affordability standards under the Code, via low-income housing tax credits under IRC § 42 or other programs, may apply to DHCD.

1. 2. Threshold Requirements

All projects requesting PABs must file an application, available from DHCD.

Local housing authorities must file Form

LHA.

All PAB applications to DHCD must include the following documentation per project:

1. Inducement or official intent resolution or documentation of preliminary project approval by the issuing authority, in conformity with federal and state law;

1. Documentation of project approval by the appropriate governing body (see § 5.1) or elected official, in conformity with federal and state law;

1. Written bond counsel opinion that the project qualifies for PABs under the Code and requires an allocation of bond authority from the state ceiling;

1. A binding financing commitment from the bond buyer or underwriter, or if sold competitively, a letter from the project’s financial advisor;

1. Certification that the project’s financing includes IRC §42 low-income housing tax credits; if not, documentation of participation in other federal, state, or local housing programs with enforceable rent standards;

1. Certification by an accountant, executive, or appropriate entity that the applicant requests no more than 55% of the project’s basis in PAB allocation per the submitted budget;

1. All applications from local housing authorities requesting bond allocations must include a letter from the city, town, county manager, or chief local administrator;

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Project location and conformity with the local or DHCD-consolidated Plan. DHCD will determine conformity if applicable.

1. Supplemental allocations must certify that the allocation covers project costs requiring additional tax-exempt bonds;

Financing: applicant must explain additional allocation use and why it was not in the original application.

1. 3. Effective Period of Allocations

PAB allocation from DHCD is effective for 120 days after award or until December 15, whichever is earlier.

DHCD may extend the 120-day closing period by up to 60 days before December 15. Requests must include reasons for extension by day 90 of the period.

1. 4. State Guidelines to Change as Federal Law Determines Eligibility

Federal law termination or reauthorization of PAB eligibility will exclude or include that PAB portion from these guidelines.

4. ADDITIONAL CRITERIA

1. 1. Reporting Bond Issuance

DHCD must receive IRS Form 8038 for all PABs issued in the year by the deadline; unfiled bonds revert to DHCD for reallocation.

For carryforward allocations, IRS Form 8328 is due by January 15; IRS Form 8038 must be sent when bonds are issued.

5. APPLICATION REVIEW AND EVALUATION

1. 1. Dates and Submission Timeline

Applicants are encouraged to notify DHCD of intent to apply soon after January 1 annually.

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First round applicants must notify DHCD of intent at least 30 days before application opening.

Second round applicants/representatives must notify 30 days before the application open date. For projects with a public hearing in the previous year, they must submit notice by the

beginning of the first round of applications.

Applicants must submit notification on DHCD's form; failure to do so may result in no allocation for that year.

Program Dates:

Below are key application and allocation dates for DHCD-administered state ceiling; dates are approximate and subject to revision.

January 1–15: State ceiling amounts are reserved for project types per state law each year.

January 15 (Anticipated): DHCD's first application round for Local Housing Authority PAB allocation opens; closes after about 30 days.

April 1 (Anticipated): DHCD's second application round opens; closes after about 30 days.

July 1 (Anticipated): Optional third funding round opens, scored on a rolling basis.

December 1: Final day for applications for year-end carryforward.

December 15:

Last day to issue private activity bonds for projects with prior allocations from the state ceiling.

December 20–31:

Allocations for year-end carryforward will follow the priority system in these guidelines.

1. 2. Scoring Criteria

DHCD aims to promote affordable housing production/rehab in high-demand areas via PAB allocation, using three scoring criteria to prioritize.

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Clear Description of Project Need:

DHCD will prioritize projects in areas with greater affordable housing needs, considering the following criteria:

• Job creation in the locality’s PDC, measured by VEDP’s job announcements per person for the prior year (see Appendix A);
• Housing cost burden, the percentage of renters paying over 30% of income on housing, as calculated by DHCD for the prior year (see Appendix B).

Demonstration of Readiness: DHCD prioritizes projects showing clear financing readiness for rapid affordable housing production or rehab, considering:

• Presence of a valid proposed Plan of Development;
• Presence of a completed Zoning Document;
• Presence of a construction contract
• Positive recommendation from NCHMA-certified Market Analysis;
• Sponsor Characteristics.

Efficiency for Allocation Requests: DHCD prioritizes efficient projects mindful of limited PABs, considering:

• The cost per unit created or rehabilitated;
• Leveraging other financing resources as shown in the project’s capital stack or as determined by DHCD;
• Bond request size, no more than 55% of the project’s basis in PAB allocation as certified; smaller basis requests score higher.

1. 3. Other Scoring Considerations

DHCD does not prioritize new construction over rehab or vice versa but considers project category when evaluating readiness, efficiency, and related factors.

1. 4. Tiebreaker Criteria

If multiple requests with equal scores exceed available allocation, DHCD will select via random lottery.

1. 5. Scoring Rubric

Category Percent Possible Points Project Need – 35%

8

[TABLE 8-1]

1. If DHCD receives multiple equally scored requests exceeding available allocation, a random lottery will determine the award;
2. 5. Scoring Rubric

[/TABLE]

[TABLE 8-2] Category | Percent | Possible Points Project Need – 35% | |

[/TABLE]

• Page 9 ---

10 Points: projects in localities with higher job creation activity/PDC score higher.

• 10 points: High Job Creation/PDC activity 10%
• 5 points: Medium Job Creation/PDC
• 0 points: No Job Creation/PDC; 25 points: higher score for projects in localities with higher cost burden.
• 25 points: High Cost Burden

Housing Cost Burden 25% - 20 points: Above Average Cost Burden

• 15 points: Below Average Cost Burden
• 0 points: Low Cost Burden

Project Readiness – 35% Approved Plan of 5 Points: where submission of an approved plan provides 5 5% Development points. 5 Points: where submission of a document (either Zoning Document 5% demonstrating approved zoning changes or that the project is by-right) provides 5 points.

Market Analysis 10 Points: where submission of a document provides 10 10% Recommendation points. 5 Points: where presence of a fixed cost and executed construction contract equals a higher score.

• 5 points: There is an executed fixed cost construction contract.

Construction Contract 5% - 3 points: There is evidence of a construction contract that will be executed prior to closing.

• 0 points: No evidence of a construction contract. 10 Points: additional Developer Experience can add up to 15 points.
• 10 points: 5+ bond projects in Virginia in past five years Sponsor Characteristics 10%
• 5 points: 1-4 bond projects in Virginia in the past five years
• 0 points: 0 projects in Virginia in the past five years Project Efficiency - 30%

10 Points: higher resource efficiency score equals higher score.

• 10 points: 80-100 score Cost per Unit 10%
• 5 points: 40-79 score
• 0 point: 0-39 score 10 Points; where evidence of more eligible resources Other Resources leverage equated to a higher score: 10% Leveraged* 10 points: at least 2 other local, state, or federal resources leveraged. 9

[TABLE 9-1] | | Job Creation Activity | | | 10% | | | | 10 Points: where projects located in localities with a greater | | | | | | | | | | | job creation activity/PDC equals a higher score. | | | | | | | | | | | - 10 points: High Job Creation/PDC | | | | | | | | | | | - 5 points: Medium Job Creation/PDC | | | | | | | | | | | - 0 points: No Job Creation/PDC | | | | Housing Cost Burden | | | 25% | | | | 25 Points: where projects located in localities with a higher | | | | | | | | | | | level of cost burden equals a higher score. | | | | | | | | | | | - 25 points: High Cost Burden | | | | | | | | | | | - 20 points: Above Average Cost Burden | | | | | | | | | | | - 15 points: Below Average Cost Burden | | | | | | | | | | | - 0 points: Low Cost Burden | | | Project Readiness – 35% | | | | | | | | | | | | Approved Plan of Development | | | 5% | | | | 5 Points: where submission of an approved plan provides 5 | | | | | | | | | | | points. | | | | Zoning Document | | | 5% | | | | 5 Points: where submission of a document (either | | | | | | | | | | | demonstrating approved zoning changes or that the project | | | | | | | | | | | is by-right) provides 5 points. | | | | | Market Analysis | | 10% | | | | 10 Points: where submission of a document provides 10 | | | | | Recommendation | | | | | | points. | | | | Construction Contract | | | 5% | | | 5 Points: where presence of a fixed cost and executed construction contract equals a higher score.

• 5 points: There is an executed fixed cost construction contract.
• 3 points: There is evidence of a construction contract that will be executed prior to closing.
• 0 points: There is no evidence of a construction contract. | 5 Points: where presence of a fixed cost and executed | | | | | | | | | | | construction contract equals a higher score. | | | | | | | | | | | | - 5 points: There is an executed fixed cost | | | | | | | | | | | construction contract. | | | | | | | | | | | - 3 points: There is evidence of a construction | | | | | | | | | | | contract that will be executed prior to closing. | | | | | | | | | | | - 0 points: There is no evidence of a construction | | | | | | | | | | | contract. | | | Sponsor Characteristics | | | 10% | | | 10 Points: where presence of additional Developer Experience can add up to 15 points:
• 10 points : 5 or more bond projects in Virginia in the past five calendar years
• 5 points: 1-4 bond projects in Virginia in the past five years
• 0 points: 0 projects in Virginia in the past five years | | | | Project Efficiency - 30% | | | | | | | | | | | | Cost per Unit | | | 10% | | | 10 Points: higher resource efficiency score equals higher score.
• 10 points: 80-100 score
• 5 points: 40-79 score
• 0 point: 0-39 score | 10 Points: where a higher efficient use of resources (cost) | | | | | | | | | | | score equals a higher score. | | | | | | | | | | | | - 10 points: 80-100 score | | | | | | | | | | | - 5 points: 40-79 score | | | | | | | | | | | - 0 point: 0-39 score | | | Other Resources Leveraged* | | | 10% | | | | 10 Points; where evidence of more eligible resources | | | | | | | | | | | leverage equated to a higher score: | | | | | | | | | | | 10 points: at least 2 other local, state, or federal resources | | | | | | | | | | | leveraged. | |

[/TABLE]

TABLE 9-2: Developer Experience: 10 points for 5+ bond projects in Virginia in past 5 years; 5 points for 1-4 projects; 0 for none.

[/TABLE]

[TABLE 9-3]

[/TABLE]

[TABLE 9-4] Other Resources Leveraged*

[/TABLE]

• Page 10 ---

5 points: at least one other local, state, or federal resources leveraged. 0 points: no other resources leveraged.

• Includes grant or loan funding from local, state, federal entities, excluding GP, sponsor loans, or deferred fees. 10 Points: 50.01%-50.99% of basis requested.

1. 5 points: 51%-51.99% basis requested.

Bond Request Size 10% 5 points: 52.00–52.99% aggregate basis requested.

1. 5 points: 53.00–53.99%; 0 points: 54.00–54.99% basis requested.

Threshold Criteria Must be met to receive allocation

TOTAL 100% _/100 Points

1. 6. Project Approval.

Upon scoring from DHCD and PAB approval, local issuing authority projects must be approved by the governing body over the authority and the locality, often the same.

6. EFFECTIVE DATE OF SCORING CRITERIA

The guidelines take effect January 1, 2025, upon BHCD approval before that date and after a 30-day public comment period.

10

[TABLE 10-1] | | | | | | | | 5 points: at least one other local, state, or federal resources | | | | | | | | | leveraged. | | | | | | | | | 0 points: no other resources leveraged. | | | | | | | | | *this includes grant or loan funding provided by a local, state, federal or | | | | | | | | | other entity. It does not include GP, sponsor loans, or deferred developer | | | | | | | | | fees or other similar items. | | | Bond Request Size | | 10% | | | | 10 Points: where a lesser proportion of the aggregate basis | | | | | | | | | requested equals a higher score: | | | | | | | | | 10 points: 50.01% - 50.99% aggregate basis requested. | | | | | | | | | 7.5 points: 51%-51.99% basis requested. | | | | | | | | | 5 points: 52.00 – 52.99% aggregate basis requested. | | | | | | | | | 2.5 points: 53.00 – 53.99 aggregate basis requested. | | | | | | | | | 0 points: 54.00 – 54.99% aggregate basis requested. | Threshold Criteria | | | | Must be met to receive allocation | | | | | | TOTAL | | | | 100% | | | _/100 Points |

[/TABLE]

• Page 11 ---

APPENDIX A: JOB CREATION PER PLANNING DISTRICT COMMISSION:

To encourage projects in economically active localities, DHCD will consider the ratio of new jobs created in a Planning District Commission (PDC)

relative to its population. The formula is:

𝑁𝑈𝑀𝐵𝐸𝑅 𝑂𝐹 𝐽𝑂𝐵𝑆 𝐶𝑅𝐸𝐴𝑇𝐸𝐷

JOB CREATION/PERSON = TOTAL PDC POPULATION. After calculation, DHCD will categorize localities into three groups:

• High Job Creation (per capita > 0.001);
• Medium Job Creation (0.001 > per capita > 0.000),
• Low/No Job Creation (per capita = 0.000).

Projects in localities with “High” or “Medium” job creation will receive extra points; categories are in the following table.

Job creation data is from 2022 Virginia Announcements; population data is from the Weldon Cooper Center as of July 1, 2022.

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• Page 12 ---

GOVA New Jobs Category – Locality PDC Jurisdiction Population Region Created PDC Accomack County 5 22 County 32,926 246 High Albemarle County 9 10 County 115,495 8 Low Alexandria City 7 8 City 158,128 0 High Alleghany County 2 5 County 14,898 0 Low Amelia County 3 14 County 13,263 0 None Amherst County 2 11 County 31,139 0 Low Appomattox County 2 11 County 16,534 130 Low Arlington County 7 8 County 241,283 1118 High Augusta County 8 6 County 77,758 500 Medium Bath County 8 6 County 4,228 0 Medium Bedford City 2 11 City 79,943 30 Low Bland County 1 3 County 6,295 0 Medium Botetourt County 2 5 County 33,510 0 Low

Bristol City 1 3 City 16,803 0 Medium Brunswick County 3 13 County 15,465 0 High Buchanan County 1 2 County 19,434 181 High Buckingham County 3 14 County 16,810 0 None Buena Vista City 8 6 City 6,647 0 Medium Campbell County 2 11 County 55,955 0 Low Caroline County 6 16 County 32,334 745 High Carroll County 1 3 County 28,809 0 Medium Charles City County 4 15 County 6,587 0 High Charlotte County 3 14 County 11,433 0 None Charlottesville City 9 10 City 51,278 0 Low

Chesapeake City 5 23 City 251,959 75 Low Chesterfield County 4 15 County 381,858 2212 High Clarke County 8 7 County 15,341 0 Low Colonial Heights City 4 15 City 18,040 0 High Covington City 2 5 City 5,650 0 Low Craig County 2 5 County 4,906 0 Low Culpeper County 9 9 County 54,089 0 Low Cumberland County 3 14 County 9,877 0 None Danville City 3 12 City 42,348 0 Medium Dickenson County 1 2 County 13,711 0 High Dinwiddie County 4 19 County 28,552 145 Low

Emporia City 4 19 City 5,657 0 Low Essex County 6 18 County 10,578 0 None Fairfax City 7 8 City 24,003 0 High Fairfax County 7 8 County 1,139,755 3237 High Falls Church City 7 8 City 14,566 0 High Fauquier County 9 9 County 73,536 0 Low Floyd County 2 4 County 15,160 15 Medium Fluvanna County 9 10 County 27,843 0 Low Franklin City 5 23 City 54,155 0 Low Franklin County 2 5 County 7,987 0 Low Fredrick County 8 7 County 94,871 37 Low

Fredericksburg City 6 16 City 27,667 0 High 12

[TABLE 12-1] Locality | GOVA Region | PDC | Jurisdiction | Population | New Jobs Created | Category – PDC Accomack County | 5 | 22 | County | 32,926 | 246 | High Albemarle County | 9 | 10 | County | 115,495 | 8 | Low Alexandria City | 7 | 8 | City | 158,128 | 0 | High Alleghany County | 2 | 5 | County | 14,898 | 0 | Low Amelia County | 3 | 14 | County | 13,263 | 0 | None Amherst County | 2 | 11 | County | 31,139 | 0 | Low Appomattox County | 2 | 11 | County | 16,534 | 130 | Low Arlington County | 7 | 8 | County | 241,283 | 1118 | High Augusta County | 8 | 6 | County | 77,758 | 500 | Medium Bath County | 8 | 6 | County | 4,228 | 0 | Medium Bedford City | 2 | 11 | City | 79,943 | 30 | Low Bland County | 1 | 3 | County | 6,295 | 0 | Medium Botetourt County | 2 | 5 | County | 33,510 | 0 | Low Bristol City | 1 | 3 | City | 16,803 | 0 | Medium Brunswick County | 3 | 13 | County | 15,465 | 0 | High Buchanan County | 1 | 2 | County | 19,434 | 181 | High Buckingham County | 3 | 14 | County | 16,810 | 0 | None Buena Vista City | 8 | 6 | City | 6,647 | 0 | Medium Campbell County | 2 | 11 | County | 55,955 | 0 | Low Caroline County | 6 | 16 | County | 32,334 | 745 | High Carroll County | 1 | 3 | County | 28,809 | 0 | Medium Charles City County | 4 | 15 | County | 6,587 | 0 | High Charlotte County | 3 | 14 | County | 11,433 | 0 | None Charlottesville City | 9 | 10 | City | 51,278 | 0 | Low Chesapeake City | 5 | 23 | City | 251,959 | 75 | Low Chesterfield County | 4 | 15 | County | 381,858 | 2212 | High Clarke County | 8 | 7 | County | 15,341 | 0 | Low Colonial Heights City | 4 | 15 | City | 18,040 | 0 | High Covington City | 2 | 5 | City | 5,650 | 0 | Low Craig County | 2 | 5 | County | 4,906 | 0 | Low Culpeper County | 9 | 9 | County | 54,089 | 0 | Low Cumberland County | 3 | 14 | County | 9,877 | 0 | None Danville City | 3 | 12 | City | 42,348 | 0 | Medium Dickenson County | 1 | 2 | County | 13,711 | 0 | High Dinwiddie County | 4 | 19 | County | 28,552 | 145 | Low Emporia City | 4 | 19 | City | 5,657 | 0 | Low Essex County | 6 | 18 | County | 10,578 | 0 | None Fairfax City | 7 | 8 | City | 24,003 | 0 | High Fairfax County | 7 | 8 | County | 1,139,755 | 3237 | High Falls Church City | 7 | 8 | City | 14,566 | 0 | High Fauquier County | 9 | 9 | County | 73,536 | 0 | Low Floyd County | 2 | 4 | County | 15,160 | 15 | Medium Fluvanna County | 9 | 10 | County | 27,843 | 0 | Low Franklin City | 5 | 23 | City | 54,155 | 0 | Low Franklin County | 2 | 5 | County | 7,987 | 0 | Low Fredrick County | 8 | 7 | County | 94,871 | 37 | Low Fredericksburg City | 6 | 16 | City | 27,667 | 0 | High

[/TABLE]

• Page 13 ---

GOVA New Jobs Category – Locality PDC Jurisdiction Population Region Created PDC Galax City 1 3 City 6,778 0 Medium Giles County 2 4 County 16,657 0 Medium Gloucester County 6 18 County 38,799 0 None Goochland County 4 15 County 26,183 0 High Grayson County 1 3 County 15,347 0 Medium Greene County 9 10 County 21,165 0 Low Greensville County 4 19 County 11,088 0 Low Halifax County 3 13 County 33,257 297 High Hampton City 5 23 City 136,387 0 Low Hanover County 4 15 County 112,409 502 High Harrisonburg City 8 6 City 55,700 0 Medium Henrico County 4 15 County 336,074 809 High Henry County 3 12 County 48,835 0 Medium

Highland County 8 6 County 2,234 0 Medium Hopewell City 4 19 City 22,657 0 Low Isle of Wight County 5 23 County 39,950 0 Low James City County 5 23 County 79,488 0 Low King and Queen County 6 18 County 6,663 0 None King George County 6 16 County 27,645 0 High King William County 6 18 County 18,107 0 None Lancaster County 6 17 County 10,757 0 None Lee County 1 1 County 21,699 0 None Lexington City 8 6 City 7,264 0 Medium Loudoun County 7 8 County 431,006 903 High

Louisa County 9 10 County 39,725 0 Low Lunenburg County 3 14 County 11,958 0 None Lynchburg City 2 11 City 80,127 0 Low Madison County 9 9 County 14,017 0 Low Manassas City 7 8 City 42,626 149 High Manassas Park City 7 8 City 17,277 0 High Martinsville City 3 12 City 13,234 0 Medium Mathews County 6 18 County 8,446 0 None Mecklenburg County 3 13 County 30,179 60 High Middlesex County 6 18 County 10,779 0 None Montgomery County 2 4 County 102,061 200 Medium

Nelson County 9 10 County 14,813 0 Low New Kent County 4 15 County 24,808 352 High Newport News City 5 23 City 183,504 64 Low Norfolk City 5 23 County 237,770 355 Low Northampton County 5 22 County 12,039 0 High Northumberland County 6 17 County 11,778 0 None Norton City 1 1 City 3,638 0 None Nottoway County 3 14 County 15,608 0 None Orange County 9 9 County 37,109 10 Low Page County 8 7 County 23,374 0 Low Patrick County 3 12 County 17,080 0 Medium

Petersburg City 4 19 City 33,466 10 Low 13

[TABLE 13-1] Locality | GOVA Region | PDC | Jurisdiction | Population | New Jobs Created | Category – PDC Galax City | 1 | 3 | City | 6,778 | 0 | Medium Giles County | 2 | 4 | County | 16,657 | 0 | Medium Gloucester County | 6 | 18 | County | 38,799 | 0 | None Goochland County | 4 | 15 | County | 26,183 | 0 | High Grayson County | 1 | 3 | County | 15,347 | 0 | Medium Greene County | 9 | 10 | County | 21,165 | 0 | Low Greensville County | 4 | 19 | County | 11,088 | 0 | Low Halifax County | 3 | 13 | County | 33,257 | 297 | High Hampton City | 5 | 23 | City | 136,387 | 0 | Low Hanover County | 4 | 15 | County | 112,409 | 502 | High Harrisonburg City | 8 | 6 | City | 55,700 | 0 | Medium Henrico County | 4 | 15 | County | 336,074 | 809 | High Henry County | 3 | 12 | County | 48,835 | 0 | Medium Highland County | 8 | 6 | County | 2,234 | 0 | Medium Hopewell City | 4 | 19 | City | 22,657 | 0 | Low Isle of Wight County | 5 | 23 | County | 39,950 | 0 | Low James City County | 5 | 23 | County | 79,488 | 0 | Low King and Queen County | 6 | 18 | County | 6,663 | 0 | None King George County | 6 | 16 | County | 27,645 | 0 | High King William County | 6 | 18 | County | 18,107 | 0 | None Lancaster County | 6 | 17 | County | 10,757 | 0 | None Lee County | 1 | 1 | County | 21,699 | 0 | None Lexington City | 8 | 6 | City | 7,264 | 0 | Medium Loudoun County | 7 | 8 | County | 431,006 | 903 | High Louisa County | 9 | 10 | County | 39,725 | 0 | Low Lunenburg County | 3 | 14 | County | 11,958 | 0 | None Lynchburg City | 2 | 11 | City | 80,127 | 0 | Low Madison County | 9 | 9 | County | 14,017 | 0 | Low Manassas City | 7 | 8 | City | 42,626 | 149 | High Manassas Park City | 7 | 8 | City | 17,277 | 0 | High Martinsville City | 3 | 12 | City | 13,234 | 0 | Medium Mathews County | 6 | 18 | County | 8,446 | 0 | None Mecklenburg County | 3 | 13 | County | 30,179 | 60 | High Middlesex County | 6 | 18 | County | 10,779 | 0 | None Montgomery County | 2 | 4 | County | 102,061 | 200 | Medium Nelson County | 9 | 10 | County | 14,813 | 0 | Low New Kent County | 4 | 15 | County | 24,808 | 352 | High Newport News City | 5 | 23 | City | 183,504 | 64 | Low Norfolk City | 5 | 23 | County | 237,770 | 355 | Low Northampton County | 5 | 22 | County | 12,039 | 0 | High Northumberland County | 6 | 17 | County | 11,778 | 0 | None Norton City | 1 | 1 | City | 3,638 | 0 | None Nottoway County | 3 | 14 | County | 15,608 | 0 | None Orange County | 9 | 9 | County | 37,109 | 10 | Low Page County | 8 | 7 | County | 23,374 | 0 | Low Patrick County | 3 | 12 | County | 17,080 | 0 | Medium Petersburg City | 4 | 19 | City | 33,466 | 10 | Low

[/TABLE]

• Page 14 ---

GOVA New Jobs Category – Locality PDC Jurisdiction Population Region Created PDC Pittsylvania County 3 12 County 59,366 218 Medium Poquoson City 5 23 City 12,624 0 Low Portsmouth City 5 23 City 96,700 0 Low Powhatan County 4 15 County 31,365 0 High Prince Edward County 3 14 County 21,956 0 None Prince George County 4 19 County 43,295 0 Low Prince William County 7 8 County 490,325 185 High Pulaski County 2 4 County 33,571 0 Medium Radford City 2 4 City 16,835 0 Medium Rappahannock County 9 9 County 7,394 0 Low Richmond City 4 15 City 226,967 0 None Richmond County 6 17 County 9,165 387 High Roanoke City 2 5 City 99,634 20 Low

Roanoke County 2 5 County 96,605 0 Low Rockbridge County 8 6 County 22,498 0 Medium Rockingham County 8 6 County 84,149 0 Medium Russell County 1 2 County 25,338 50 High Salem City 2 5 City 24,924 0 Low Scott County 1 1 County 21,309 0 None Shenandoah County 8 7 County 44,541 0 Low Smyth County 1 3 County 29,025 75 Medium Southampton County 5 23 County 17,913 0 Low Spotsylvania County 6 16 County 145,013 0 High Stafford County 6 16 County 163,239 103 High

Staunton City 8 6 City 25,773 0 Medium Suffolk City 5 23 City 99,179 362 Low Surry County 4 19 County 6,492 0 Low Sussex County 4 19 County 10,388 5 Low Tazewell County 1 2 County 39,470 88 High Virginia Beach City 5 23 City 455,385 525 Low Warren County 8 7 County 41,280 100 Low Washington County 1 3 County 53,723 250 Medium Waynesboro City 8 6 City 22,537 6 Medium Westmoreland County 6 17 County 18,760 0 None Williamsburg City 5 23 City 16,224 0 Low

Winchester City 8 7 City 28,417 45 Low Wise County 1 1 County 35,515 0 None Wythe County 1 3 County 27,941 0 Medium York County 5 23 County 71,491 0 Low

14

[TABLE 14-1] Locality | GOVA Region | PDC | Jurisdiction | Population | New Jobs Created | Category – PDC Pittsylvania County | 3 | 12 | County | 59,366 | 218 | Medium Poquoson City | 5 | 23 | City | 12,624 | 0 | Low Portsmouth City | 5 | 23 | City | 96,700 | 0 | Low Powhatan County | 4 | 15 | County | 31,365 | 0 | High Prince Edward County | 3 | 14 | County | 21,956 | 0 | None Prince George County | 4 | 19 | County | 43,295 | 0 | Low Prince William County | 7 | 8 | County | 490,325 | 185 | High Pulaski County | 2 | 4 | County | 33,571 | 0 | Medium Radford City | 2 | 4 | City | 16,835 | 0 | Medium Rappahannock County | 9 | 9 | County | 7,394 | 0 | Low Richmond City | 4 | 15 | City | 226,967 | 0 | None Richmond County | 6 | 17 | County | 9,165 | 387 | High Roanoke City | 2 | 5 | City | 99,634 | 20 | Low Roanoke County | 2 | 5 | County | 96,605 | 0 | Low Rockbridge County | 8 | 6 | County | 22,498 | 0 | Medium Rockingham County | 8 | 6 | County | 84,149 | 0 | Medium Russell County | 1 | 2 | County | 25,338 | 50 | High Salem City | 2 | 5 | City | 24,924 | 0 | Low Scott County | 1 | 1 | County | 21,309 | 0 | None Shenandoah County | 8 | 7 | County | 44,541 | 0 | Low Smyth County | 1 | 3 | County | 29,025 | 75 | Medium Southampton County | 5 | 23 | County | 17,913 | 0 | Low Spotsylvania County | 6 | 16 | County | 145,013 | 0 | High Stafford County | 6 | 16 | County | 163,239 | 103 | High Staunton City | 8 | 6 | City | 25,773 | 0 | Medium Suffolk City | 5 | 23 | City | 99,179 | 362 | Low Surry County | 4 | 19 | County | 6,492 | 0 | Low Sussex County | 4 | 19 | County | 10,388 | 5 | Low Tazewell County | 1 | 2 | County | 39,470 | 88 | High Virginia Beach City | 5 | 23 | City | 455,385 | 525 | Low Warren County | 8 | 7 | County | 41,280 | 100 | Low Washington County | 1 | 3 | County | 53,723 | 250 | Medium Waynesboro City | 8 | 6 | City | 22,537 | 6 | Medium Westmoreland County | 6 | 17 | County | 18,760 | 0 | None Williamsburg City | 5 | 23 | City | 16,224 | 0 | Low

[/TABLE]

• Page 15 ---

APPENDIX B: RENTER COST BURDEN PER LOCALITY:

To promote projects in high housing need areas, DHCD considers localities' renter cost burden compared to the state average via a normal distribution.

𝑆𝑇𝐴𝑇𝐸𝑊𝐼𝐷𝐸 𝐴𝑉𝐸𝑅𝐴𝐺𝐸 𝐶𝑂𝑆𝑇 𝐵𝑈𝑅𝐷𝐸𝑁 − 𝐿𝑂𝐶𝐴𝐿𝐼𝑇𝑌 𝐶𝑂𝑆𝑇 𝐵𝑈𝑅𝐷𝐸𝑁

𝑅𝐸𝑁𝑇𝐸𝑅 𝐶𝑂𝑆𝑇 𝐵𝑈𝑅𝐷𝐸𝑁 𝑆𝐶𝑂𝑅𝐸 = 𝑆𝑇𝐴𝑇𝐸𝑊𝐼𝐷𝐸 𝑆𝑇𝐴𝑁𝐷𝐴𝑅𝐷 𝐷𝐸𝑉𝐼𝐴𝑇𝐼𝑂𝑁 𝑂𝐹 𝐶𝑂𝑆𝑇 𝐵𝑈𝑅𝐷𝐸𝑁 Upon completing this calculation, DHCD categorized localities by four categories, where higher scores equate to greater renter cost burden:

• High Cost Burden: renter burden > 47% (≥1 SD above average);
• Above Average Burden: renter burden between 39%-47%;
• Below Average Burden: renter burden between 31%-39%;
• Low Cost Burden = Renter cost burden one standard deviation below or more than the statewide average (Renter Cost Burden < 31%);

Projects in higher burden localities earn extra points; categories are in the following table.

Housing cost burden data is from the 2021 ACS; 'Cost Burdened' households pay over 30% of income on rent, as a percentage of renters.

15

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Renter Cost Renter Cost GOVA Juris- Renter Cost Locality PDC Burden Burden Region diction Burden Score Category Accomack County 5 22 County 34.23% 96.87 Below Average Albemarle County 9 10 County 43.29% 102.45 Above Average Alexandria City 7 8 City 42.92% 102.22 Above Average Alleghany County 2 5 County 33.44% 96.39 Below Average Amelia County 3 14 County 48.65% 105.75 High Amherst County 2 11 County 38.07% 99.24 Below Average Appomattox County 2 11 County 37.03% 98.60 Below Average Arlington County 7 8 County 37.02% 98.59 Below Average Augusta County 8 6 County 35.20% 97.47 Below Average Bath County 8 6 County 23.02% 89.97 Low Bedford City 2 11 City 39.52% 100.13 Above Average Bland County 1 3 County 37.33% 98.79 Below Average Botetourt County 2 5 County 24.61% 90.95 Low Bristol City 1 3 City 42.15% 101.75 Above Average Brunswick County 3 13 County 38.41% 99.45 Below Average Buchanan County 1 2 County 31.70% 95.32 Below Average

Buckingham County 3 14 County 40.63% 100.82 Above Average Buena Vista City 8 6 City 51.16% 107.30 High Campbell County 2 11 County 32.74% 95.96 Below Average Caroline County 6 16 County 45.25% 103.66 Above Average Carroll County 1 3 County 33.79% 96.60 Below Average Charles City County 4 15 County 43.46% 102.56 Above Average Charlotte County 3 14 County 40.75% 100.89 Above Average

Charlottesville City 9 10 City 51.35% 107.41 High Chesapeake City 5 23 City 51.72% 107.64 High Chesterfield County 4 15 County 45.81% 104.00 Above Average Clarke County 8 7 County 56.76% 110.75 High Colonial Heights City 4 15 City 59.66% 112.53 High Covington City 2 5 City 26.48% 92.11 Low

Craig County 2 5 County 24.54% 90.91 Low Culpeper County 9 9 County 39.96% 100.40 Above Average Cumberland County 3 14 County 26.42% 92.07 Low Danville City 3 12 City 42.62% 102.04 Above Average Dickenson County 1 2 County 38.35% 99.41 Below Average Dinwiddie County 4 19 County 32.49% 95.80 Below Average Emporia City 4 19 City 43.70% 102.71 Above Average

Essex County 6 18 County 49.86% 106.50 High Fairfax City 7 8 City 48.82% 105.85 High Fairfax County 7 8 County 44.50% 103.19 Above Average Falls Church City 7 8 City 34.57% 97.08 Below Average Fauquier County 9 9 County 34.02% 96.74 Below Average Floyd County 2 4 County 36.00% 97.97 Below Average

16

Counties and cities' renter burden data, scores, and categories from table 16-1, including Accomack, Albemarle, Alexandria, and others. Buckingham County | 3 | 14 | County | 40.63% | 100.82 | Above Average Buena Vista City | 8 | 6 | City | 51.16% | 107.30 | High Campbell County | 2 | 11 | County | 32.74% | 95.96 | Below Average Caroline County | 6 | 16 | County | 45.25% | 103.66 | Above Average Carroll County | 1 | 3 | County | 33.79% | 96.60 | Below Average Charles City County | 4 | 15 | County | 43.46% | 102.56 | Above Average Charlotte County | 3 | 14 | County | 40.75% | 100.89 | Above Average Charlottesville City | 9 | 10 | City | 51.35% | 107.41 | High Chesapeake City | 5 | 23 | City | 51.72% | 107.64 | High Chesterfield County | 4 | 15 | County | 45.81% | 104.00 | Above Average Clarke County | 8 | 7 | County | 56.76% | 110.75 | High Colonial Heights City | 4 | 15 | City | 59.66% | 112.53 | High Covington City | 2 | 5 | City | 26.48% | 92.11 | Low Craig County | 2 | 5 | County | 24.54% | 90.91 | Low Culpeper County | 9 | 9 | County | 39.96% | 100.40 | Above Average Cumberland County | 3 | 14 | County | 26.42% | 92.07 | Low Danville City | 3 | 12 | City | 42.62% | 102.04 | Above Average Dickenson County | 1 | 2 | County | 38.35% | 99.41 | Below Average Dinwiddie County | 4 | 19 | County | 32.49% | 95.80 | Below Average Emporia City | 4 | 19 | City | 43.70% | 102.71 | Above Average Essex County | 6 | 18 | County | 49.86% | 106.50 | High Fairfax City | 7 | 8 | City | 48.82% | 105.85 | High Fairfax County | 7 | 8 | County | 44.50% | 103.19 | Above Average Falls Church City | 7 | 8 | City | 34.57% | 97.08 | Below Average Fauquier County | 9 | 9 | County | 34.02% | 96.74 | Below Average Floyd County | 2 | 4 | County | 36.00% | 97.97 | Below Average

[/TABLE]

• Page 17 ---

Renter Cost Renter Cost GOVA Juris- Renter Cost Locality PDC Burden Burden Region diction Burden Score Category Fluvanna County 9 10 County 20.11% 88.18 Low Franklin City 5 23 City 47.31% 104.93 Above Average Franklin County 2 5 County 36.02% 97.97 Below Average Fredrick County 8 7 County 36.54% 98.29 Below Average Fredericksburg City 6 16 City 44.73% 103.34 Above Average Galax City 1 3 City 39.40% 100.06 Above Average Giles County 2 4 County 30.32% 94.47 Low Gloucester County 6 18 County 40.30% 100.61 Above Average Goochland County 4 15 County 31.61% 95.26 Below Average Grayson County 1 3 County 30.03% 94.29 Low Greene County 9 10 County 26.10% 91.87 Low Greensville County 4 19 County 38.63% 99.58 Below Average Halifax County 3 13 County 43.18% 102.39 Above Average Hampton City 5 23 City 52.53% 108.14 High Hanover County 4 15 County 40.91% 100.99 Above Average Harrisonburg City 8 6 City 43.98% 102.87 Above Average

Henrico County 4 15 County 47.64% 105.13 High Henry County 3 12 County 38.31% 99.39 Below Average Highland County 8 6 County 29.88% 94.20 Low Hopewell City 4 19 City 45.91% 104.06 Above Average Isle of Wight County 5 23 County 36.67% 98.38 Below Average James City County 5 23 County 46.35% 104.33 Above Average King and Queen County 6 18 County 24.95% 91.16 Low

King George County 6 16 County 47.07% 104.78 Above Average King William County 6 18 County 33.26% 96.28 Below Average Lancaster County 6 17 County 37.94% 99.16 Below Average Lee County 1 1 County 39.66% 100.22 Above Average Lexington City 8 6 City 48.49% 105.65 High Loudoun County 7 8 County 41.41% 101.29 Above Average

Louisa County 9 10 County 46.59% 104.48 Above Average Lunenburg County 3 14 County 34.10% 96.80 Below Average Lynchburg City 2 11 City 45.23% 103.65 Above Average Madison County 9 9 County 33.30% 96.30 Below Average Manassas City 7 8 City 51.59% 107.56 High Manassas Park City 7 8 City 58.94% 112.09 High Martinsville City 3 12 City 40.93% 101.00 Above Average

Mathews County 6 18 County 34.57% 97.09 Below Average Mecklenburg County 3 13 County 36.18% 98.07 Below Average Middlesex County 6 18 County 36.69% 98.39 Below Average Montgomery County 2 4 County 44.61% 103.27 Above Average Nelson County 9 10 County 29.21% 93.79 Low New Kent County 4 15 County 54.06% 109.08 High

17

[TABLE 17-1] Locality | GOVA Region | PDC | Juris-diction | Renter Cost Burden | Renter Cost Burden Score | Renter Cost Burden Category Fluvanna County | 9 | 10 | County | 20.11% | 88.18 | Low Franklin City | 5 | 23 | City | 47.31% | 104.93 | Above Average Franklin County | 2 | 5 | County | 36.02% | 97.97 | Below Average Fredrick County | 8 | 7 | County | 36.54% | 98.29 | Below Average Fredericksburg City | 6 | 16 | City | 44.73% | 103.34 | Above Average Galax City | 1 | 3 | City | 39.40% | 100.06 | Above Average Giles County | 2 | 4 | County | 30.32% | 94.47 | Low Gloucester County | 6 | 18 | County | 40.30% | 100.61 | Above Average Goochland County | 4 | 15 | County | 31.61% | 95.26 | Below Average Grayson County | 1 | 3 | County | 30.03% | 94.29 | Low Greene County | 9 | 10 | County | 26.10% | 91.87 | Low Greensville County | 4 | 19 | County | 38.63% | 99.58 | Below Average Halifax County | 3 | 13 | County | 43.18% | 102.39 | Above Average Hampton City | 5 | 23 | City | 52.53% | 108.14 | High Hanover County | 4 | 15 | County | 40.91% | 100.99 | Above Average Harrisonburg City | 8 | 6 | City | 43.98% | 102.87 | Above Average Henrico County | 4 | 15 | County | 47.64% | 105.13 | High Henry County | 3 | 12 | County | 38.31% | 99.39 | Below Average Highland County | 8 | 6 | County | 29.88% | 94.20 | Low Hopewell City | 4 | 19 | City | 45.91% | 104.06 | Above Average Isle of Wight County | 5 | 23 | County | 36.67% | 98.38 | Below Average James City County | 5 | 23 | County | 46.35% | 104.33 | Above Average King and Queen County | 6 | 18 | County | 24.95% | 91.16 | Low King George County | 6 | 16 | County | 47.07% | 104.78 | Above Average King William County | 6 | 18 | County | 33.26% | 96.28 | Below Average Lancaster County | 6 | 17 | County | 37.94% | 99.16 | Below Average Lee County | 1 | 1 | County | 39.66% | 100.22 | Above Average Lexington City | 8 | 6 | City | 48.49% | 105.65 | High Loudoun County | 7 | 8 | County | 41.41% | 101.29 | Above Average Louisa County | 9 | 10 | County | 46.59% | 104.48 | Above Average Lunenburg County | 3 | 14 | County | 34.10% | 96.80 | Below Average Lynchburg City | 2 | 11 | City | 45.23% | 103.65 | Above Average Madison County | 9 | 9 | County | 33.30% | 96.30 | Below Average Manassas City | 7 | 8 | City | 51.59% | 107.56 | High Manassas Park City | 7 | 8 | City | 58.94% | 112.09 | High Martinsville City | 3 | 12 | City | 40.93% | 101.00 | Above Average Mathews County | 6 | 18 | County | 34.57% | 97.09 | Below Average Mecklenburg County | 3 | 13 | County | 36.18% | 98.07 | Below Average Middlesex County | 6 | 18 | County | 36.69% | 98.39 | Below Average Montgomery County | 2 | 4 | County | 44.61% | 103.27 | Above Average Nelson County | 9 | 10 | County | 29.21% | 93.79 | Low New Kent County | 4 | 15 | County | 54.06% | 109.08 | High

[/TABLE]

• Page 18 ---

Renter Cost Renter Cost GOVA Juris- Renter Cost Locality PDC Burden Burden Region diction Burden Score Category Newport News City 5 23 City 48.40% 105.60 High Norfolk City 5 23 County 49.39% 106.21 High Northampton County 5 22 County 27.86% 92.95 Low Northumberland County 6 17 County 30.96% 94.86 Low Norton City 1 1 City 43.91% 102.83 Above Average Nottoway County 3 14 County 31.19% 95.00 Below Average Orange County 9 9 County 32.84% 96.02 Below Average Page County 8 7 County 35.51% 97.66 Below Average Patrick County 3 12 County 29.74% 94.11 Low Petersburg City 4 19 City 45.64% 103.90 Above Average Pittsylvania County 3 12 County 40.77% 100.90 Above Average Poquoson City 5 23 City 21.56% 89.07 Low Portsmouth City 5 23 City 51.95% 107.79 High Powhatan County 4 15 County 40.42% 100.68 Above Average Prince Edward County 3 14 County 41.03% 101.06 Above Average Prince George County 4 19 County 42.47% 101.95 Above Average

Prince William County 7 8 County 46.56% 104.46 Above Average Pulaski County 2 4 County 32.60% 95.87 Below Average Radford City 2 4 City 47.44% 105.01 High Rappahannock County 9 9 County 28.71% 93.47 Low Richmond City 4 15 City 50.21% 106.72 High Richmond County 6 17 County 32.82% 96.01 Below Average Roanoke City 2 5 City 44.22% 103.03 Above Average

Roanoke County 2 5 County 42.76% 102.12 Above Average Rockbridge County 8 6 County 32.83% 96.01 Below Average Rockingham County 8 6 County 32.24% 95.65 Below Average Russell County 1 2 County 29.96% 94.25 Low Salem City 2 5 City 37.80% 99.07 Below Average Scott County 1 1 County 26.75% 92.27 Low

Shenandoah County 8 7 County 35.78% 97.83 Below Average Smyth County 1 3 County 39.56% 100.16 Above Average Southampton County 5 23 County 32.92% 96.07 Below Average Spotsylvania County 6 16 County 45.61% 103.88 Above Average Stafford County 6 16 County 43.37% 102.50 Above Average Staunton City 8 6 City 45.63% 103.90 Above Average Suffolk City 5 23 City 51.98% 107.80 High

Surry County 4 19 County 31.15% 94.98 Low Sussex County 4 19 County 38.48% 99.49 Below Average Tazewell County 1 2 County 33.32% 96.31 Below Average Virginia Beach City 5 23 City 46.79% 104.61 Above Average Warren County 8 7 County 37.79% 99.07 Below Average Washington County 1 3 County 28.28% 93.21 Low

18

Counties and cities' renter burden data, scores, and categories from table 18-1, including Newport News, Norfolk, Northampton, Northumberland, Norton, Nottoway, Orange, Page, Patrick, Petersburg, Pittsylvania, Poquoson, Portsmouth, Powhatan, Prince Edward, Prince George, Prince William, Pulaski, Radford, Rappahannock, Richmond, Roanoke, Rockbridge, Rockingham, Russell, Salem, Scott, Shenandoah, Smyth, Southampton, Spotsylvania, Stafford, Staunton, Suffolk, Surry, Sussex, Tazewell, Virginia Beach, Warren, Washington counties and cities.

[/TABLE]

• Page 19 ---

Renter Cost Renter Cost GOVA Juris- Renter Cost Locality PDC Burden Burden Region diction Burden Score Category Waynesboro City 8 6 City 49.27% 106.14 High Westmoreland County 6 17 County 42.75% 102.12 Above Average Williamsburg City 5 23 City 47.49% 105.04 High Winchester City 8 7 City 43.52% 102.59 Above Average Wise County 1 1 County 34.16% 96.83 Below Average Wythe County 1 3 County 28.34% 93.25 Low York County 5 23 County 45.79% 103.99 Above Average

19

Counties and cities' renter burden data, scores, and categories from table 19-1, including Waynesboro, Westmoreland, Williamsburg, Winchester, Wise, Wythe, York.

[/TABLE]

• Page 1 ---

Virginia Broadband Availability Map

Internet Service Provider Service Territory

Data Submission Guidelines

Bryan W. Horn Director

Tamarah Holmes, Ph.D.

Director, Office of Broadband

• Page 2 ---

Virginia Broadband Availability Map Internet Service Provider Service Territory Data

Submission Guidelines

Draft for Public Comment

Section P of Item 115 of Chapter 2, 2022 Acts of Assembly, 2022 Special Session 1, commonly known as the Budget Bill, directs the Department of Housing and Community Development (DHCD) to develop a statewide broadband availability map indicating broadband coverage, including maximum broadband speeds available in service territories in the Commonwealth. As directed in the Budget Bill, all broadband service providers shall be required to submit updated service territory data to the Department annually, containing the locations to which they provide broadband service.

Pursuant to budget bill language, the Department may publish only anonymized versions of the map, showing serviceable and unserviceable by broadband without reference to any specific provider. The map shall not include information regarding ownership or control over the network or networks providing service. Information submitted by a broadband provider in connection with

this section shall be excluded from the requirements of the Virginia Freedom of Information Act (§ 2.2-3700 et seq.). Information submitted by a broadband provider pursuant to this section shall be used solely for the purposes stated under this section and shall not be released by the Department, or any other public records custodian, without the express written permission of the submitting broadband provider.

Data Submission Requirements Pursuant to budget bill language, broadband providers shall be required to submit updated service

territory data to the Department annually. Also, in no instance may the Department require broadband providers to submit any data, in either substantive content or form, beyond that which the provider is required to submit to the Federal Communications Commission (FCC) pursuant to the federal Broadband Deployment Accuracy and Technological Availability Act, 47 U.S.C. § 641 et. seq. Service territory data includes where the provider has actually built out their broadband network infrastructure and is able to provide that service through a standard broadband installation.1 Broadband providers include terrestrial fixed, mobile or fixed wireless, or satellite2 providing broadband internet access service and includes entities required to provide the federal government

as part of the federal Digital Opportunity Data Collection program pursuant to 47 U.S.C. § 214(e)(6) for any portion of the Commonwealth.

1 As referenced in Public Law 116-130, commonly known as the “Broadband Deployment Accuracy and Technological Availability Act” a standard broadband installation means the initiation by a provider of fixed broadband internet access service in an area where the provider has not previously offered that service, with no charges or delays attributable to the extension of the network of the provider; and includes the initiation of fixed broadband internet access service through routine installation that can be completed not later than 10 business days after the date on which the service request is submitted. 2 Satellite-based broadband providers that have been designated as an eligible telecommunications carrier pursuant to 47 U.S.C. § 214(e)(6) for any portion of the Commonwealth shall be required to submit comparable data as other broadband providers

• Page 3 ---

The data submitted must meet the requirements established in the federal Broadband DATA Act

(Act, 47 U.S.C. § 641 et. seq.), as outlined in these guidelines, and include granular service territory data.

This data must be the same, in substance and in form, as submitted to the Federal Communications Commission under its Broadband Data Collection Program by their March 1, 2024 submission deadline for service territory data reflecting service availability on December 31, 2023.

This data must be submitted to the Broadband Data Submission Portal by March 5, 2024.

Failure to submit data by this deadline may result in supplemental action by the Commonwealth of Virginia.

Assistance with data submission is available from the DHCD Office of Broadband and CGIT at the contact emails below. After submission, providers will be notified of a successful submission once the data has been verified to be functional. Once the coverage data is published on the state broadband map there will be an opportunity for the public, government entities, and third parties to petition the accuracy of the data.

Permissions for Data Usage

By submitting service territory data for the purposes of this process, internet service providers also permit DHCD to use the data submitted for the purpose of challenging broadband availability mapping data under the Federal Communications Commission’s Broadband Data Collection (BDC) program.

Requirements of Petitioning Inaccuracies in the Commonwealth Connection:

Internet service providers may petition DHCD to correct inaccuracies in the Commonwealth Connection map. Two processes are outlined below for petitioning inaccuracies. These two processes are for the purpose of (1) petitioning inaccuracies in an internet provider’s own service territory, as well as (2) petitioning inaccuracies in service territory data as depicted on the Commonwealth Connection Map. Prior to submitting a petition under either process, DHCD strongly encourages petitioners to contact DHCD staff at broadband@dhcd.virginia.gov.

• Page 4 ---

Petitioning Inaccuracies on an Internet Service Provider’s own Service Territory Data

Internet service providers wishing to petition DHCD to correct inaccuracies in their own service coverage data as displayed on the map should contact both emails listed under the Contact Information section of this document. Petitions under this category must be received by DHCD by July 1, 2024 to be considered. These petitions must include a cover letter explaining the alleged inaccuracies in the data as displayed on the Commonwealth Connection map, and if necessary, an

updated submission in accordance with the requirements outlined under these guidelines. Any determination made by the department pursuant to any specific petition under this section with respect to any specific map to correct inaccuracies shall be final and not subject to further review.

DHCD will update the Commonwealth Connection map reflecting these petitions by September 1, 2024.

Petitioning Inaccuracies on Service Territory Data as depicted on the map Internet service providers seeking to petition DHCD to correct inaccuracies in service territory data as displayed on the Commonwealth Connection Map must submit the information required

below to initiate the petition process to both email addresses listed under the Contact Information section of this document. DHCD must receive all of the information detailed below or the petition will be deemed incomplete and invalid. Petitioners must provide: ● A cover letter explaining the justification for the petition ● A signed and notarized affidavit affirming the petition and attached information is true. ● Point shapefiles that show each location in the petitioned area, designated by a singular

mapped point, in the petitioned area containing attribute data showing the addresses of each point; or, Polygon shapefiles delineating the general petitioned area(s). These files must be provided in .zip file form and must be in alignment with the shapefile guidelines provided above under the Data Submission Requirements Section. Locations in the petitioned area may also be submitted as a list of VGIN ID points in a comma delimited text file (.csv), so long as their formatting conforms to the CSV and Shapefile Guidelines. Note: Point and polygon shapefiles submitted with petitions are subject to the Freedom of Information Act and will not be provided FOIA exemption. ● Petitioners must, for a minimum of at least 50% of locations in the petitioned area, provide

written justification for the basis of the petition. DHCD requires petitioners to conduct speed tests on at least 20% of locations in the petitioned area to justify assertions included in the petition. DHCD prefers speed tests to be conducted at the access point (i.e. customer premise equipment, router, or modem) at the end-user location.

Petitions under this category must be received by DHCD by July 1, 2024 to be considered. DHCD will review all applicable petition information to determine if a petition is credible. If deemed credible, DHCD will notify internet service providers which purported service coverage in the petitioned area by July 15, 2024.

DHCD will provide the opportunity for internet service providers which purported service coverage in the petition area to submit a rebuttal to the petition. If planning to submit a rebuttal, internet service providers must notify DHCD of this intent by July 22, 2024. Upon this notification, DHCD will provide at a minimum, the cover letter, affidavit, and shapefiles

• Page 5 ---

submitted with the petition to internet service providers seeking to submit a rebuttal. All rebuttal information must be submitted to DHCD by August 22, 2024. Information submitted to contest a petition is at the discretion of the internet service provider submitting the rebuttal. All information submitted in the rebuttal process by an internet service provider shall be considered voluntarily submitted by that internet service provider.

If a petition is not rebutted, DHCD will make a determination based upon the information submitted in the petition. Any determination made by the department pursuant to any specific petition under this section with respect to any specific map to correct inaccuracies shall be final and not subject to further review. DHCD will update the Commonwealth Connection map reflecting petition determinations by September 1, 2024 and notify internet service providers of the determination by this date.

Contact Information: DHCD Office of Broadband: broadband@dhcd.virginia.gov

VT Center for Geospatial Information Technology: cgitsupport@vt.edu

• Page 1 ---

Virginia Broadband Availability Map

Internet Service Provider Service Territory

Data Submission Guidelines

Bryan W. Horn Director

Tamarah Holmes, Ph.D.

Director, Office of Broadband

• Page 2 ---

Virginia Broadband Availability Map Internet Service Provider Service Territory Data

Submission Guidelines

Draft for Public Comment

Section P of Item 115, Chapter 2, 2022 Acts, directs DHCD to develop a statewide broadband map showing coverage and max speeds. Providers must annually submit updated service territory data with locations served.

Per budget bill, the Department may publish only anonymized maps showing serviceable/unserviceable areas without provider info or ownership details. Data submitted by providers in connection with

Data submitted under this section is exempt from FOIA (§ 2.2-3700) and may only be used for stated purposes, not released without provider’s written permission.

Broadband providers must submit updated service

annually. The Department cannot require data beyond what providers submit to the FCC under the Broadband Deployment Accuracy and Technological Availability Act (47 U.S.C. § 641). Data includes locations where infrastructure is built and service is available via standard broadband installation. Providers include terrestrial fixed, mobile, wireless, satellite, and entities required for federal Digital Opportunity Data Collection.

as part of the federal Digital Opportunity Data Collection under 47 U.S.C. § 214(e)(6) for any part of the Commonwealth.

1 Under Public Law 116-130, a standard broadband installation is initiating fixed broadband service in an area not previously served, with no charges or delays, completed within 10 business days. 2 Satellite providers designated as eligible telecommunications carriers must submit comparable data.

• Page 3 ---

Data must meet the federal Broadband DATA Act requirements

(Act, 47 U.S.C. § 641 et. seq.), as outlined in these guidelines, and include granular service territory data.

Data must match FCC Broadband Data Collection submissions by March 1, 2024, reflecting service availability as of December 31, 2023.

Submit data to the Broadband Data Portal by March 5, 2024.

Failure to submit by deadline may lead to actions by Virginia.

Assistance is available from DHCD Office of Broadband and CGIT. Providers will be notified upon verification. After publication, the public and entities can petition data accuracy.

Permissions for Data Usage

By submitting data, ISPs permit DHCD to use it for challenging broadband mapping under FCC’s BDC program.

Requirements of Petitioning Inaccuracies in the Commonwealth Connection:

ISPs may petition DHCD to correct map inaccuracies in their own service territory or on the Commonwealth Connection Map. Contact DHCD staff at broadband@dhcd.virginia.gov before submitting.

• Page 4 ---

Petitions to Correct ISP’s Own Service Data

ISPs seeking to correct their service data on the map must contact the listed emails. Petitions are due by July 1, 2024, and must include a cover letter explaining inaccuracies.

updated submission in accordance with the requirements outlined under these guidelines. Any determination made by the department pursuant to any specific petition under this section with respect to any specific map to correct inaccuracies shall be final and not subject to further review.

DHCD will update the map by September 1, 2024, reflecting petitions.

ISPs petitioning to correct map data must submit required information.

below to initiate the petition process to both email addresses listed under the Contact Information section of this document. DHCD must receive all of the information detailed below or the petition will be deemed incomplete and invalid. Petitioners must provide: ● A cover letter explaining the justification for the petition ● A signed and notarized affidavit affirming the petition and attached information is true. ● Point shapefiles that show each location in the petitioned area, designated by a singular

mapped point, in the petitioned area containing attribute data showing the addresses of each point; or, Polygon shapefiles delineating the general petitioned area(s). These files must be provided in .zip file form and must be in alignment with the shapefile guidelines provided above under the Data Submission Requirements Section. Locations in the petitioned area may also be submitted as a list of VGIN ID points in a comma delimited text file (.csv), so long as their formatting conforms to the CSV and Shapefile Guidelines. Note: Point and polygon shapefiles submitted with petitions are subject to the Freedom of Information Act and will not be provided FOIA exemption. ● Petitioners must, for a minimum of at least 50% of locations in the petitioned area, provide

Petitioners must provide written justification. DHCD requires speed tests on at least 20% of locations, preferably at the access point (customer premise equipment, router, or modem).

Petitions must be received by DHCD by July 1, 2024. DHCD will review and, if credible, notify ISPs of coverage in the petitioned area by July 15, 2024.

ISPs may submit rebuttals; they must notify DHCD of intent by July 22, 2024. DHCD will then provide the cover letter, affidavit, and shapefiles submitted with the petition.

• Page 5 ---

Rebuttal submissions must be received by DHCD by August 22, 2024. Submission content is at the ISP's discretion and is voluntary.

If unrebutted, DHCD will decide based on petition info. Final map updates will be made by September 1, 2024, and ISPs notified.

Contact Information: DHCD Office of Broadband: broadband@dhcd.virginia.gov

VT Center for Geospatial Information Technology: cgitsupport@vt.edu

• Page 1 ---

Affordable and Special Needs Housing –Consolidated Application Program Guidelines

2020 - 2021 Application Due Dates: December 4, 2020 March 31, 2021

• Page 2 ---

Purpose The Affordable and Special Needs Housing (ASNH) Program’s goals are to create and preserve affordable housing units within the Commonwealth of Virginia. The program achieves these goals by providing assistance in the form of financing to projects that will meet local affordable housing needs and support state housing policy.

This document is intended to provide guidance only. For more detailed information and for questions outside the scope of the guidelines please contact the Department of Housing and Community Development (DHCD):

DHCD Affordable and Special Needs Housing Program Staff Michael Program Manager Michael.haas@dhcd.virginia.gov (804)212-5934 Haas Chloe Program Chloe.Rote@dhcd.virginia.gov (804)840-1909

Rote Administrator Loren Program Loren.brown@dhcd.virginia.gov (804)371-7024 Brown Administrator: Long Term Compliance

Background The ASNH Program is funded through a single competitive application for four funding sources.

These program guidelines provide requirements and parameters for each of these funding sources. Overall the ASNH program seeks to support affordable housing statewide, however the ASNH’s HOME funds give preference to projects located in HOME non-entitlement localities. The four funding sources and available amounts are listed below:

2020 – 2021 ASNH

Source Amount

HOME $7,547,851 National Housing Trust Fund $5,552,095

Virginia Housing Trust Fund $16,680,000*

State Permanent Supportive Housing $500,000

TOTAL $30,279,946 *Estimated funding availability, subject to change

HOME This program is funded through the federal HOME Investment Partnerships Program (HOME).

This federal funding was created through the National Affordable Housing Act of 1990. Funds from the HOME program are made available annually through formula allocations to states and local governments (Participating Jurisdictions or PJs).

Virginia Affordable and Special Needs Housing: Program Guidelines 2 2020 - 2021 (revised October, 2020)

[TABLE 2-1] | DHCD Affordable and Special Needs Housing Program Staff | | | | Michael Haas | | Program Manager | Michael.haas@dhcd.virginia.gov | (804)212-5934 | Chloe Rote | | Program Administrator | Chloe.Rote@dhcd.virginia.gov | (804)840-1909 | Loren Brown | | Program Administrator: Long Term Compliance | Loren.brown@dhcd.virginia.gov | (804)371-7024 |

[/TABLE]

[TABLE 2-2] | 2020 – 2021 ASNH | | | | | Source | | | Amount | | HOME | | | $7,547,851 | | National Housing Trust Fund | | | $5,552,095 | | Virginia Housing Trust Fund | | | $16,680,000* | | State Permanent Supportive Housing | | | $500,000 |

| TOTAL | | | $30,279,946 |

[/TABLE]

• Page 3 ---

PJs are responsible for conducting needs assessments and establishing priorities and goals, and developing and managing the programs that will help meet these goals. The Affordable and Special Needs Housing Program is a subset of the Commonwealth’s HOME Program.

While projects may be statewide the program gives priority to projects located in non-entitlement areas which are those not receiving a direct federal HOME allocation through a local PJ or HOME Consortium.

The ASNH program also gives Community Housing Development Organizations (CHDO) preference for HOME funding. See DHCD’s online resources for more information on CHDO requirements.

National Housing Trust Fund The National Housing Trust Fund (NHTF) is a federal program administered by HUD through an annual block grant to states. The NHTF is a new program with its first allocation beginning

in 2016 to support the creation and preservation of affordable housing for extremely low-income households (at or below 30 percent area median income AMI). Virginia will allocate these funds based on a competitive application process to projects that will create or preserve critical affordable rental housing based on local market need, and project feasibility/readiness, and developer capacity.

Virginia Housing Trust Fund (Competitive Loan Pool) The Virginia Housing Trust Fund Competitive Loan Pool is funded through Virginia’s Housing Trust Fund, which is a special allocation of state funds intended to help address the commonwealth’s housing needs and reduce homelessness. The loan pool provides low-interest loans to meet the financing needs of housing projects including affordable rental and homeownership addressing key state housing policies. Beneficiaries must be at 80 percent or less area median income.

Please note that Virginia Housing Trust Fund expenditures associated with projects funded through the ASNH program will be used to meet the State’s federal HOME program match

requirement and may not be utilized for any subsequent regulatory match requirement without permission from DHCD.

State Permanent Supportive Housing (PHS) Funds The PSH funds provides a developer subsidy to support the development of new permanent supportive housing units. Supportive housing is an evidence-based housing intervention that combines non-time-limited affordable housing assistance with wrap-around supportive services for people experiencing homelessness, as well as other people with disabilities.

Application Process Based on funding availability up to $30.2 million dollars in HOME, NHTF, Virginia HTF, and PSH resources will be made available during the 2020 – 2021 program year to assist affordable housing projects selected through the ASNH consolidated application process.

Applications will be accepted twice during the program year. Approximately half of the HOME, NHTF and State Housing Trust Funds will be allocated during each of the two funding

Virginia Affordable and Special Needs Housing: Program Guidelines 3 2020 - 2021 (revised October, 2020)

• Page 4 ---

rounds (December 4, 2020 and March 31, 2021). Any funding not obligated as a result of the first round will be allocated through a subsequent round with applications.

Developers may submit project applications to DHCD for consideration on or before the established deadlines. All applications received by the deadline will be reviewed against established criteria to identify those projects best positioned to meet priority housing needs within Virginia. Applicants have the opportunity to receive a debriefing on unsuccessful applications.

All applications for funding must be submitted to DHCD through the online application and project management system called CAMS (Centralized Application and Management System). Please allow up to two business days for responses to any CAMS help desk request. Applications must be submitted in CAMS by 11:59 PM by the deadline as follows:

 December 4, 2020

 March 31, 2021

Please note that DHCD technical assistance is limited to normal business hours.

Applications must meet minimum requirements including scoring at least 60 points in order to be considered for funding. Scoring criteria are as follows:

o Meeting local housing needs (40 percent); o Project feasibility (30 percent); and o Development team’s capacity to successfully complete the proposed project (30 percent).

Beginning activities prior to receiving approval from DHCD may jeopardize the ASNH preliminary qualification status.

Preliminary Qualification Status Project applications selected through the ASNH application process for funding offers will receive notification in writing that their project has met initial thresholds criteria to preliminarily qualify the project. The preliminary qualification period expires in one year from the date of the letter. DHCD reserves the right to withdraw project preliminary qualification status based on project progress and overall status at any point during the one-year period.

Environmental Review All applicants must complete a Phase 1 Environmental Site Assessment (ESA). In addition, a Part 58 ESA review is required before DHCD can execute any HOME or NHTF Program Agreement to secure a final funding offer. It is essential that developers not proceed with any project activity (e.g., acquisition, rehabilitation, demolition, construction, etc.) prior to the execution of the program agreement lest the project be rendered ineligible for funding.

Applicants must allow sufficient time to complete and forward all required environmental site assessment documentation to DHCD. Please note, coordination on the environmental review procedure is required if combining ASNH resources with CDBG or other federal funding such

as local HOME. Part 58 checklists must be submitted within six months of a HOME or NHTF award being made, and prior to any potentially choice limiting activities being undertaken. The Virginia Affordable and Special Needs Housing: Program Guidelines 4 2020 - 2021 (revised October, 2020)

• Page 5 ---

checklists can be found on DHCD’s website under at: https://www.dhcd.virginia.gov/home-funds under “resources.”

Pre-Contract Conference Developers must meet with DHCD program staff to review program and project requirements prior to the issuance of a program agreement. DHCD will take the initiative to schedule the conferences as appropriate. Please note, participation is required as a condition to preliminary qualification status.

Program Agreement Applicants who have received notification of preliminary qualification status must finalize and execute a program agreement including meeting any federal requirements, if applicable, prior to the expiration of the preliminary qualification status. The program agreements expire two years from the execution date of the agreement. A six-month extension to the program agreement may be granted by DHCD in specific circumstances. Written requests for extensions must be received by DHCD prior to expiration of the agreement. Please note

developers cannot proceed with any project activities prior to the execution of the program agreement and that doing so will render the project ineligible.

Loan Commitment A program agreement must be in effect in order to receive a formal loan commitment for permanent financing (deferred loan agreement for Homebuyer projects). Loan commitments will generally expire after 18 months after the issue date.

Additional information on the ASNH application process can be found in the Application Instructions and at the How to Apply Workshop.

Eligible Virginia Localities DHCD targets ASNH statewide, thus projects located in any Virginia locality are eligible for HOME, NHTF and State HTF. Please note that a funded project must be clearly addressing a critical local need as supported by needs assessments, market studies, and/or documented demand.

DHCD gives scoring preferences for HOME funds to projects in localities that do not receive direct HOME allocations. These are localities that are not HUD participating jurisdictions (PJs) or members of HOME consortiums.

There is a local match requirement for all projects located in areas receiving a HOME allocation directly from the federal government. These localities are HOME entitlement areas or member jurisdictions of a HOME consortium.

Projects proposed in these areas must have a local match for at least 25 percent of the total HOME Affordable Housing and Special Needs Housing Program loan request. Local match can include CDBG, HOME or other federal or state funds that are administered by the local government. This match can also be met based on the waiver of locally collected fees directly associated with the specific development (e.g., water and sewer connection fees).

Documentation of local match must be included in the application.

Virginia Affordable and Special Needs Housing: Program Guidelines 5 2020 - 2021 (revised October, 2020)

• Page 6 ---

HOME Entitlements and Consortiums – 25 percent Match Required Winchester Consortium – including: Alexandria Winchester Chesapeake

Fredrick County Danville Page County Hampton

Clarke County Lynchburg Warren County Newport News Shenandoah County Norfolk

Charlottesville Consortium - including Portsmouth Charlottesville Richmond Albemarle County Roanoke City

Fluvanna County Virginia Beach Greene County Arlington County Louisa County Chesterfield County

Nelson County Fairfax County -including New River Consortium– including Fairfax City Radford Falls Church

Giles County Henrico County Montgomery County Prince William County –including Pulaski County Manassas

Blacksburg Manassas Park Christiansburg Bristol City (member of Tennessee consortium) Suffolk Consortium –including

Suffolk Isle of Wight Franklin City

Southampton

Virginia Affordable and Special Needs Housing: Program Guidelines 6 2020 - 2021 (revised October, 2020)

[TABLE 6-1] HOME Entitlements and Consortiums – 25 percent Match Required | Winchester Consortium – including: | Alexandria Winchester | Chesapeake Fredrick County | Danville Page County | Hampton Clarke County | Lynchburg Warren County | Newport News Shenandoah County | Norfolk Charlottesville Consortium - including | Portsmouth Charlottesville | Richmond Albemarle County | Roanoke City Fluvanna County | Virginia Beach Greene County | Arlington County Louisa County | Chesterfield County Nelson County | Fairfax County -including New River Consortium– including | Fairfax City Radford | Falls Church Giles County | Henrico County Montgomery County | Prince William County –including Pulaski County | Manassas Blacksburg | Manassas Park Christiansburg | Bristol City (member of Tennessee consortium) Suffolk Consortium –including | Suffolk | Isle of Wight | Franklin City | Southampton |

[/TABLE]

• Page 7 ---

Eligible Applicants Eligible applicants are non-profit organizations or for-profit housing developers, state-certified Community Housing Development Organizations (CHDOs), and public housing authorities seeking to develop affordable housing projects in Virginia.

The applicant (CAMS organizational profile) must be the owner, developer, or sponsor of the proposed project:

o Owner – holds valid legal title to, or long term leasehold interest in the property

o Developer – owns the property and is developing the project, or has a contractual obligation to develop the project

o Sponsor –is the owner or partial owner and agrees to convey ownership to a second non-profit at a predetermined time prior to or during development or upon completion (requires consultation with DHCD prior to application)

Applicants, the organization that submits the ASNH application, must have a registered CAMS profile in order to apply. Please note, that the applications must be submitted by the primary partner in the project not the project Limited Liability Corporation (L.L.C.). The applicant is the entity responsible for long-term operations and compliance. Applications will not be accepted from the project legal entity or limited liability corporation. Please contact DHCD if you have any questions.

DHCD will not enter into program agreements with any applicant with outstanding audit findings, IRS findings, DHCD monitoring findings or other compliance issues. Please note that DHCD will work with all interested parties to resolve any findings or compliance issues, where appropriate.

DHCD must verify project partner capacity and roles when evaluating applications and project feasibility. Applicants must be able to clearly articulate the relationship between all partners involved in the development, ownership, and property management of a project.

Type of Assistance Assistance received through ASNH is provided as permanent long-term must pay debt after all other financial commitments are received these funds are leveraged to close a financing gap in the affordable housing project. The amount of funds committed must be the minimum amount needed. Cash flow loan requests will be not be considered.

All rental project applications must assume permanent financing structured as a three percent interest-only deferred payment loan over the full required affordability period of time (30 years).

This is 15 or 20 years for the HUD miniumum affordability period with the balance of the 30 years as a state extended compliance period. Please reference the next section on affordability period for specifics.

Homebuyer projects are typically structured as construction financing. Construction draws are based on specific project completion milestones.

Virginia Affordable and Special Needs Housing: Program Guidelines 7 2020 - 2021 (revised October, 2020)

• Page 8 ---

Per project funding limits and total request caps are as follows: Per Fund Source Limits Project Type Maximum

Affordable Housing Projects $700,000 Project Including PSH $900,000 Total Request Cap

Total Request (not including NHTF) $1,400,000 Total Request (including NHTF) $2,000,000 Total Request Project including $2,400,000 PSH (Including PSH & NHTF) *See the Eligible Projects section for more details.

The funding request caps above are inclusive of any DHCD commitments made to the project through any past or future funding rounds. DHCD reserves the right to adjust funding offers by funding source to meet project needs. Please note, that DHCD will consider excluding Vibrant Community Initiative requests/commitments from these caps.

DHCD reserves the right to charge DHCD incurred project costs to the project. These costs include only actual applicable project costs such as environmental review notices and legal services.

DHCD incurred costs are structured as a grant. This grant amount is included in the total amount of project assistance. The total ASHN project assistance is reflected in the restrictive deed, the program agreement, underwriting, and subsidy layering analysis.

Program requirements including the number of required HOME or NHTF units are based on total amount of HOME or NHTF assistance (including total ASNH assistance and HOME from other sources) as compared to the total development costs. Please note that for this purpose development costs are limited to HOME or NHTF eligible costs and must exclude non-eligible costs such as community buildings, market rate units, and retail space.

Please note that match requirements, if applicable, apply to the total HOME loan amount

only.

Affordability Period Any time funds are committed to a project it results in a mandatory affordability period on the property. This is the period of time that the unit or units must be maintained as affordable according to the agreement between the developer and DHCD. This affordability period is enforced through a restrictive covenant deed on the property. The affordability period is based on the type of project and the total amount of assistance including both developer subsidies and homeownership assistance. Please note the affordability period is specific to a funding source. For the HOME funding this includes all HOME funds from all HOME sources including both state HOME funds and local PJ or Consortium HOME funds. The required type and number of assisted units will be determined by DHCD during underwriting.

Virginia Affordable and Special Needs Housing: Program Guidelines 8 2020 - 2021 (revised October, 2020)

[TABLE 8-1] | Per Fund Source Limits | | Project Type | | Maximum | Affordable Housing Projects | | $700,000 | Project Including PSH | | $900,000 | | Total Request Cap | | Total Request (not including NHTF) | | $1,400,000 | Total Request (including NHTF) | | $2,000,000 | Total Request Project including PSH (Including PSH & NHTF) | | $2,400,000 |

[/TABLE]

• Page 9 ---

Affordability Periods by source/activity

Source/Activity Years

National HTF

National HFT (only rental eligible) 30 years

HOME

HOME Rental New Construction 20 years +10 years state compliance period, 30 total years

HOME Rental Rehabilitation 15 years+ 15 years state compliance period, 30 total years

HOME Homebuyer (less than $15,000)* 5 years

HOME Homebuyer ($15,000 - $40,000)* 10 years

HOME Homebuyer (more than $40,000)* 15 years State HTF/PSH

Virginia HTF/PSH Rental 30 years

Virginia HTF Homebuyer 5 years *If only homebuyer developer subsidy, a resale provision applies. If DHCD DPA is included in a unit then a recapture provision applies and affordability is based on the amount of DPA only.

Long-Term Compliance (Rental Projects) Projects will be inspected for property standards and program compliance within 12 months of project completion. Projects will be inspected thereafter no less than every three years. All rental projects must submit annual rent and occupancy reports and project financials. Onsite inspections and monitoring frequencies are based on performance and risk assessments.

Rental projects must meet program rent, occupancy, and property standards and other

applicable federal or state requirements for the duration of the affordability period in accordance with the program agreement. Additional HOME/NHTF program investments cannot occur during this time period. Projects unable to meet these requirements or projects at-risk of non-compliance may be required to submit to more frequent monitoring, to change property management, and/or transfer ownership.

Long-Term Compliance (Homebuyer Projects) Resale Requirement: (Homebuyer Developer Subsidy Only) Homebuyer assisted units structured as only developer subsidy are subject to a resale provision. In these cases a resale provision applies where units must be resold to an income eligible homebuyer if within the applicable affordability period. The developer must monitor sales, foreclosures, and title transfers to assure affordability requirements. The developer Virginia Affordable and Special Needs Housing: Program Guidelines 9 2020 - 2021 (revised October, 2020)

[TABLE 9-1] | Affordability Periods by source/activity | | | | | Source/Activity | | | Years | | National HTF | | | | | National HFT (only rental eligible) | | | 30 years | | HOME | | | | HOME Rental New Construction | | | | 20 years +10 years state | | | | | compliance period, 30 total | | | | | years | HOME Rental Rehabilitation | | | | 15 years+ 15 years state | | | | | compliance period, 30 total | | | | | years | | HOME Homebuyer (less than $15,000)* | | | 5 years | | HOME Homebuyer ($15,000 - $40,000)* | | | 10 years | | HOME Homebuyer (more than $40,000)* | | | 15 years | | State HTF/PSH | | | | | Virginia HTF/PSH Rental | | | 30 years | | Virginia HTF Homebuyer | | | 5 years |

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must ensure that resale requirements are imposed if the housing does not continue to be the principal residence of the occupant or family for the duration of the period of affordability, and must also ensure that the housing is only made available for subsequent purchase to a buyer whose family household qualifies as a low-income family and will use the property as its principal residence. The resale requirement must also ensure that the price at resale provides the original assisted owner a fair return on investment (including the homeowner’s investment and any capital improvement) and ensure that the housing will remain affordable to a reasonable range of qualified low-income homebuyers. The period of affordability is based on the total amount of funds invested in the housing.

A “fair return on investment” is determined by the resale price that takes into account a return of the initial homebuyer’s initial investment plus any capital improvements made to the housing unit, which are typically set or limited based on changes in area median sales price. These factors typically establish the fair market value for the city or county that the property is located. The intent is to provide a fair return to the seller while limiting price based solely on the Median Sales Price to a potential buyer. To determine a “a fair return on

investment”, the ASNH Program will measure the percentage change in median sales prices over the period of ownership as a reasonable index that is directly related to real estate prices in the area which will simplify the resale approach by taking both market appreciation and depreciation into account. It is important to note that in certain circumstances, such as a declining housing market where home values are depreciating, the original homebuyer may not receive a return on his or her investment because the home sold for less or the same price as the original purchase price. DHCD ‘s intent is to set a resale price that provides a fair return to the original homebuyer while ensuring that the property is affordable to the target population, thus reducing the need for additional subsidies to eligible buyers.

A capital improvement is any addition or alteration to real property that meets the following conditions:

 It substantially adds to the value of the real property, or appreciably prolongs the useful life of the real property; and

 It becomes part of the real property or is permanently affixed to the real property so that removal would cause material damage to the property or article itself.

The value of any capital improvement will be determined by the national average increase in value that a specific type of improvement brings at sale. For example, if homeowner’s downpayment = $5000, value of capital improvements = $9000 and the percentage change of median sales price over ownership period = 3.5%, then, fair return on investment = ($5000 + $9000) x 3.5= $490. In this example, the total return to original homebuyer at sale = $14,490 ($5000 + $9000 + $490).

A “reasonable range of low-income buyers” is defined in the ASNH Program as a household or family at or below 80 percent of Area Median Income paying no more than 30 percent of income for principal, interest, property taxes, and insurance.

DHCD will use deed restrictions, covenants running with the land, or other similar mechanisms as the mechanism to impose the resale and continued affordability requirements as outlined in §92.254(a)(5)(i)(A) of the HOME Rule. The developer may use

Virginia Affordable and Special Needs Housing: Program Guidelines 10 2020 - 2021 (revised October, 2020)

[TABLE 10-1]  It substantially adds to the value of the real property, or appreciably prolongs the useful life of the real property; and  It becomes part of the real property or is permanently affixed to the real property so that removal would cause material damage to the property or article itself.

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purchase options, rights of first refusal or other preemptive rights to purchase the housing before any conveyance to preserve affordability. The affordability restrictions shall be revived according to the original terms if, during the original affordability period, the owner of record before the termination event, obtains an ownership interest in the housing.

Recapture Provision: Direct Buyer Assistance ASNH Homebuyer HOME-assisted units including DHCD HOME Down Payment Assistance (DPA) direct buyer assistance are subject to a recapture provision in order to assure that the units either remain affordable (i.e., housing eligible clients) or that DHCD recovers its investment based on the terms of the agreement. Recapture applies and the amount to be recaptured is limited to the amount of direct buyer assistance (not the developer subsidy).

Virginia will use the recapture provision at §92.254(a)(5)(ii))1)- to recapture the entire amount. The total original amount of the direct buyer assistance is recaptured from the net proceeds in the case of sale, refinance (see exception below), foreclosure or failure to maintain as primary residency prior to the end of the affordability period. In these cases the required

amount returned (total assistance amount from net proceeds) is due and payable in full to DHCD to the Treasurer of Virginia. The assistance may not be subordinated to refinancing of the first lien position primary mortgage or an equity loan or line of credit during the period of affordability except under special hardship conditions at DHCD’s discretion. Affordability requirements are secured by a Restricted Deed of Covenant in the amount of direct assistance.

The loan is forgiven in full at the end of the affordability period.

Developer Requirements Federal regulations require DHCD to certify developer capacity (including CHDOs) prior to the commitment of HOME or NHTF funds. Developer capacity requirements include:  Experience developing similar projects  Staff with development experience (excludes consultants, contractors or partners)  Current financial soundness

Please note that capacity is evaluated for all applicants including those seeking state resources. DHCD seeks to select the highest quality projects for funding commitments. It is critical that applicants and development teams have demonstrated success with similar projects and financial health to successful complete a project and all applicable long-term compliance terms.

Please note that preference for HOME funding is given to CHDO’s. DHCD must confirm at application that the CHDO meets CHDO organizational and mission requirements. These include:  Nonprofit status  Primary mission provision of affordable housing  Board composition meets HUD requirements

 Independence in decision making authority  Community based organization  Financial soundness

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CHDOs with existing ASNH projects must confirm at any subsequent ASNH application that the CHDO continues to meet these organizational and mission requirements. Documentation of CHDO compliance must be uploaded and maintained in CAMS.

Please note, CHDOs receive funding preference for HOME funds. Any organization that meets the CHDO requirements may apply for this status by uploading documentation of organizational and mission requirements in CAMS. Please see CHDO Survival Kit and CHDO Capacity Self-Assessment Tool for more details.

CHDOs must also meet financial management and capacity requirements. These include:  Conformance to accounting standards  No individual benefit  Demonstrated capacity to develop affordable housing

CHDO requirements must be met at the time of fund commitment, for the duration of the development phase, and through the long-term compliance period for CHDO’s in the role of project/property owner. Please see CHDO Survival Kit and CHDO Capacity Self-Assessment Tool for more details.

Eligible Projects Eligible projects produce or preserve affordable housing units for low income homeowners or low income renters. Projects must include a minimum of five units (unless 100 percent special needs) and must be under common ownership, management, and financing. The minimum total investment (total development costs) per unit is at least $15,000 or includes replacement of at least three out of five major systems (e.g., HVAC, plumbing, roofing, electrical) but is no more than the actual costs or the 221 (d)(3) limit (for HOME/NHTF investments). Selected projects will always be assisted with the minimum amount of funds needed.

When HOME/NHTF resources are invested in a project the total amount of HOME/NHTF is

limited to the 221 (d) (3) HOME maximum per unit subsidy limits:

Maximum Subsidy Limit (HOME/NHTF) (effective July 14, 2020) Bedrooms Limits 0 $153,314 1 $175,752 2 $213,718 3 $276,482 4+ $303,490

A project must be either a rental project or a homebuyer project (not both). In either case these projects must have units that target income eligible households. Homebuyer projects require at least five units targeting 80 percent or below AMI. Rental projects require at least

five units (unless 100 percent special needs) that will target 60 percent or below AMI (at least 20 percent of HOME-assisted units must target 50 percent or below and 100 percent of NHTF assisted units must be at or below 30 percent AMI). Please note that project applications designed to provide a greater proportion of lower income targeting will be given

Virginia Affordable and Special Needs Housing: Program Guidelines 12 2020 - 2021 (revised October, 2020)

[TABLE 12-1] | Maximum Subsidy Limit (HOME/NHTF) | | | (effective July 14, 2020) | | Bedrooms | | Limits | 0 | | $153,314 | 1 | | $175,752 | 2 | | $213,718 | 3 | | $276,482 | 4+ | | $303,490 |

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scoring preference on the need criteria. The actual number of ASNH assisted units and income mix will be determined by DHCD during underwriting.

Projects must meet local market needs based on vacancy rates for similar projects in the area and gaps in affordable housing. DHCD must evaluate and certify that the project will meet local needs based on a market analysis.

Both new construction and substantial rehabilitation projects are eligible. Development activity beyond the original footprint will be considered new construction. In either case, construction and property standards (DHCD’s Minimum Design, Construction, and Rehab Requirements) must be met to assure that no further investment is required during the affordability period.

The ASNH assistance may not be used for acquisition-only projects, public housing or public facilities including emergency shelter, group homes (possible exception for Virginia HTF), hospitals, nursing homes, or intermediate care or assisted living facilities. In addition HOME

assistance is prohibited in any project with any prior HOME assistance from any source where the project is in the HOME affordability period.

In limited cases group homes may be eligible for Virginia HTF assistance. There must be an identified local need. Applications for Virginia HTF assisted groups homes require a pre-application consultation with DHCD.

Eligible property types include multi-unit structures, single family, two- to-four unit structures, and manufactured homes. Regardless of type, the units must be considered modest relative to the neighborhood.

All assisted projects should be located where possible in areas that decrease the overall concentration of poverty and minorities. Applicants must submit a completed Site and Neighborhood Standards form. DHCD will review and confirm the information provided. The Site and Nieghborhood Standards form includes the following information about the project and its location:

 Is located on adequate and accessible site  Furthers compliance with fair housing laws  Is on a site that is: o Not in minority concentration or racially mixed area OR o In racially mixed area but will not increase the minority concentration OR o In area of minority concentration but:  Sufficient comparable opportunities exist outside of the area for minorities OR  Necessary to meet overriding housing need that cannot otherwise be met (integral to preservation strategy OR integral to revitalizing area strategy)

 Promotes greater choice of housing opportunities and avoids undue concentration of assisted persons  Is in a neighborhood that is not detrimental to family life  Is in a location with comparable access to services and facilities Virginia Affordable and Special Needs Housing: Program Guidelines 13 2020 - 2021 (revised October, 2020)

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 Is in a location where travel/access to jobs is not excessive (not applicable to elderly housing)

Projects located in areas of concentrated proverty or minorities must provide evidence that the project will be located in a revitalization area.

Development costs are limited to eligible costs and must exclude non- eligible costs such as community buildings, market rate units, and retail space. Mixed income and multiple-use projects are eligible; however these projects must contain assisted units that will meet income and rent or sales value requirements. Please note that program requirements including the number of required assisted units are based on total amount of assistance (including HOME from other resources) as compared to the total development costs.

Scattered site projects are allowable, but all projects must be under common ownership, management, and financing.

Projects may also include units structured as Single Room Occupancy (SRO) units. These are single-room dwellings that are the primary residence of one household (single individual or two-person household). The unit must contain food preparation and/or sanitary facilities. If the unit does not contain food preparation or sanitary facilities, then the building must contain and provide access to these.

Projects may include one or more units of permanent supportive housing, which is housing targeting households who are classified as chronically homeless per the HUD definition,individuals with intellectual/developmental disabilities (IDD), and those with serious mental illnesses (SMI). Projects may also target other special needs populations such as veterans, formerly homeless (but do not meet the HUD definition of chronically homeless), and elderly. However, projects targeting these populations are not considered permanent supportive housing for the higher project cap.

Unit Type Subpopulations Project Maximum PSH Chronically $900,000 Project Cap;

Homeless/SMI/IDD Scoring Preference PSH All other subpopulations $700,000 Project Cap;

Scoring Preference Special Needs Populations: All other subpopulations $700,000 Project Cap;

Without wrap around Scoring Preference services

Please note that compliance with fair housing always applies, tenants must have a lease in their name, and participation in services may not be a condition of tenancy. Also note that project applications are evaluated based, in part, on the need the project seeks to address.

Virginia Affordable and Special Needs Housing: Program Guidelines 14 2020 - 2021 (revised October, 2020)

[TABLE 14-1] | Unit Type | | | Subpopulations | | | Project Maximum | PSH | | | Chronically Homeless/SMI/IDD | | | $900,000 Project Cap;

Scoring Preference | | PSH | | | All other subpopulations | | | $700,000 Project Cap;

Scoring Preference | | Special Needs Populations: Without wrap around services | | | All other subpopulations | | | $700,000 Project Cap;

Scoring Preference | |

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Accessible Units DHCD wishes to promote the development of accessible units and gives scoring preferences to projects that exceed minimum Section 504 accessibility requirements. This is a scoring preference for unit types that exceed the minimum requirements as below:

Minimum Requirement Unit Type Number of Units Physically Impaired Assessibility Five percent of units (minimum of one) Sensory Impaired Assessibility Two percent of units (minimum of one)

Please note, that accessible units must be distributed equitably within the project and unit types.

Please note that program agreements will reflect accessible units and require that any vacant accessible units are listed on Virginia Housing Search and held for at least 60 days before being leased to households who do not require the accommodations. Tenant selection plans must also include these units.

Accessible units are a type of unit. Special needs households, including those requiring permanent supportive housing may or may not need these accomodations. Accessible units are considered for scoring purposes separate from the number of permanent supportive housing units.

Permanent Supportive Housing Permanent Supportive Housing (PSH) is a statewide initiative to directly connect individuals meeting the PSH criteria with affordable housing. As such, projects which are selecting to

reserve a set-aside of PSH units must exhibit a direct service and referral connection with a referring and/or service agency as demonstrated by an executed MOA/MOU at the time of application. Examples of such agencies include, but are not limited to: State Agencies such as the Department of Behavioral Health and Developmental Services (DBHDS), local health departments or departments of behavioral health, local Community Service Boards, homeless continuum of care, or other such agency which provides supportive services to individuals meeting the PSH criteria.

Scoring preference and higher maximum funding limits (up to $900,000 per project) are given to projects setting aside a specific amount and type of units to targeting PSH eligible households. These units are targeted towards households whom are considered chronically homeless, have serious mental illness (SMI), and/or have an intellectual or developmental disability (I/DD).

Units designated as PSH units must upon becoming vacant be offered to families meeting the PSH criteria, and should be referenced in the properties Tenant Selection Plan. PSH units

must be held open for a minimum of 60 days upon vacancy, and may only be filled by a non-PSH household if no eligible PSH households are referred within that 60 day period. PSH designated units in properties of 25 units or less must be held open for a minimum of 30 days Virginia Affordable and Special Needs Housing: Program Guidelines 15 2020 - 2021 (revised October, 2020)

[TABLE 15-1] | Minimum Requirement | | Unit Type | | Number of Units | Physically Impaired Assessibility | | Five percent of units (minimum of one) | Sensory Impaired Assessibility | | Two percent of units (minimum of one) |

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upon vacancy, and may only be filled by a non-PSH household if no eligible PSH households are referred within that 30 day period. Projects which utilize tax credits must defer to the tax credit policy.

If at the conclusion of that MOA the initial agency cannot, or is not able to renew the MOA documented steps must be taken by the property to seek a new referral and service partner.

Please note, that the $900,000 is limited to those projects providing units to the priority PSH targets, however DHCD supports and encourages the development of projects that support other special need populations and provides scoring perferences for these projects.

Special needs and PSH units or units targeted to extremely low-income (30 percent of below AMI) households must further DHCD’s goals to support mixed-income and integrated community-based housing options. Scoring preference is given to those projects serving these populations that will also leverage rental assistance.

Please note that program agreements will reflect special needs units and require that any vacant accessible units are listed on Virginia Housing Search and held for at least 60 days before being leased to non-special needs households. Tenant selection plans must also include these units.

The applicant may not propose targeting units if other project funding resources specifically prohibit the targeting of units to specific populations.

Green Built Preference Projects including Green Building standards are encouraged. Scoring preference will be given to projects that will be third party certified.

Other Project Requirements The Fair Housing Act prohibits discrimination in the sale or rental of housing based race, color, religion, sex, national origin, handicap or familial status. This prohibition applies to all projects assisted with the ASNH program. Project that discriminate or are structured to

discriminate are ineligible.

Lead Safe Housing policies apply to ASNH projects. Please note that some projects may be exempt. For all other projects appropriate measures must be taken to assure that:

 Rehabilitation or demolition activities meet lead safe requirements;  Development costs include associated costs;  Homebuyers or tenants will receive notification (if applicable);  Operating costs include ongoing associated maintenance costs for rental projects; and  Records are maintained to document all measures taking.

Environmental measures apply to all assisted projects. All projects will require an Environmental Phase one Site Assessment. Projects receiving HOME and/or NHTF will require an additional Environmental Part 58 review. This must be completed, reviewed, and approved by DHCD. The process requires public notifications and a HUD approval of the release of funding. No development activity including the acquisition of the property can Virginia Affordable and Special Needs Housing: Program Guidelines 16 2020 - 2021 (revised October, 2020)

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occur prior to the release of funds. Any project where development activity has occurred prior to the release of funds is ineligible.

Local/state coordination of the environmental review will be required for any project combining State HOME funds local HOME or Community Development Block Grant (CDBG) funds.

Accommodations for any relocations are required for all funding sources. However,the Uniform Relocation Act (URA) applies to all HOME/NHTF assisted projects where development activity will result in the permanent or temporary dislocation of households, businesses, farms and nonprofit organizations. When permanent or temporary dislocation is possible, a notice of the intent and a survey of the occupants must be conducted prior to the ASNH application. All application must include a completed URA supplemental form and documentation of the notice and survey results. Development costs must reflect any associated costs that the project anticipates.

Section 3 requirements apply to all HOME/NHTF-assisted projects. These requirements mean that development generated opportunities must be designed to benefit to the greatest degree possible low and very low income persons in the project services area and the business that employ them. Developer hiring, contracting, and subcontracting must be structured to maximize this benefit. Project owner/developers are required to adopt specific goals, develop a Section 3 plan, and comply with required notifications, documentation, and reporting. Please note this requires annual reporting to DHCD through CAMS.

Labor Standards apply to all projects. All projects must assure that workers receive “overtime” compensation at a rate of 1.5 times their basic rate of pay for all hours worked in excess of 40 hours a work week. This applies to all project associated construction contracts funding in whole or in part with HOME/NHTF resources. All projects with 12 or more HOME assisted units (determined in underwriting by DHCD) must meet Davis-Bacon Act and the Copeland “Anti-Kickback” Act requirements. Please note that the number of units required is based, in part, of the proportion of HOME funds to the total development costs. In these cases, Davis-Bacon prevailing wages must be paid to workers at least weekly without any

deductions or rebates except permissible deductions. Reporting requirements include the payroll submissions.

Violence Against Women Act applies to all projects and provides housing protection for survivors of domestic and date violence, sexual assault, and stalking. This requirement requires that all tenants are notified of their rights under the provision. The provision allows for emergency transfers to other units, bifurcation of leases, protection against denials, evictions, and terminations that directly result from being a victim, and allow for a low-barrier certification process.

CAMS Requirements Each developer/project sponsor is required to meet project management and reporting requirements in CAMS. This is DHCD’s Centralized Application and Management System.

Applications for ASNH funding must be received in CAMS. Once a project is selected the project developer/sponsor will be required to submit project documentation to include, for example, Section 3 reports and quarterly progress reports. Please note, that it is the

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responsibility of the project developer/sponsor to log in to CAMS on a regular basis. CAMS will be the record for any project funded through the ASNH program. Preliminary qualifications letters, program agreements, inspections reports, and other project documentation will all be maintained in CAMS.

Eligible Costs Regardless of the form that ASNH assistance takes (permanent financing for rental projects or construction draws for homebuyer projects), all funded development costs must be allowable:

Specifically the following costs are allowable:  Demolition costs are eligible costs, however construction must begin within 12 months  Construction, labor, and materials  Project development related costs (e.g., financing fees, legal fees, affirmative action

marketing)  Up to 18 months rental project operating deficit reserve  Relocation (can pay for relocation costs for any household in project as a part of the overall project development costs)

The following are ineligible costs:  HOME/NHTF investments not resulting in HOME/NHTF eligible units  Project reserves other than the rental operating (listed above)  Operating reserves (rental) are limited to 18 months - operating reserves beyond 18 months are ineligible

 This assistance cannot be used for the development, operation, or modernization of any public housing  Project-based rental assistance is a prohibited expense  Delinquent taxes, fees, charges cannot be paid  Items not allowed under 2 CFR 200 or not deemed cost reasonable (see the Resources and References section for more details)  Some specific costs related to RAD (Rental Assistance Demonstration) projects

Income Eligibility The number of assisted units in a project will be determined during underwriting. These units will be limited to income eligible households based on Area Median Incomes (AMI). Income calculations must be based on HUD’s Section 8 income eligibility standard. Projects must be

able to provide a set number of assisted units.

All assisted homebuyer units must be at or below 80 percent AMI at the time that program eligibility is determined. Eligibility determination expires after six months. If closing does not occur during the six month timeframe, then income eligibility must be re-established.

All HOME -assisted rental units must be at or below 60 percent AMI at initial occupancy. The number of units and/or specific units will be determined during underwriting. At least 20 percent of these HOME units will be limited to 50 percent or below AMI.

All NHTF –assisted units must be at or below 30 percent AMI.

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All State HTF projects must be at 80 percent or below AMI; this applies to rental and homeownership projects.

Rental Projects Project development teams must attend a project management conference based on a DHCD determined schedule. A program agreement must be executed within a year of the date of notification of the preliminary qualification of the project. This means that underwriting has been completed and all funding contingencies are resolved including the environmental review and release of funds, if applicable. Please note, once the program agreement is executed any cost changes and/or changes in financing must be communicated in writing to and approved by DHCD. Changes will be reviewed and adjustments made to the underwriting analysis and program agreement as applicable.

While final cost certification and completion reports are required at closing, progress reports are required quarterly on each project during the development phase. Regular construction inspections will be conducted to verify progress.

Affordability periods begin once completion reports (including lease up data) are submitted and approved by DHCD. Lease up documentation as well as all inspection documents must be submitted to DHCD in order to close the development phase of the project, to assure eligibility of the developer for funding of future projects, and to begin the affordability period. Non-compliance could suspend eligibility for subsequent commitments and could result in the repayment of all funds to DHCD.

The actual amount of assistance in any project must be the minimum amount needed to produce or preserve an affordable housing unit. All assisted rental projects have affordability periods based on the type of assistance and development.

Based on the ASNH investment the project will require a set number of assisted units. This is based on the proportion of total funds in the project compared to the total development costs.

Total development costs must exclude non-eligible costs.

Assisted units have income and rent restrictions. HOME-assisted units are limited to 50 or 60 percent AMI at initial occupancy (NHTF are limited to 30 percent AMI). Rents for the units are restricted to the Low or High HOME (or NHTF) rents for the area. Rents cannot exceed the HOME/NHTF rents, with the exception of project-based rental assistance. Please see the Compliance in HOME Rental Projects: Guide for Property Owners and HOME Rental Compliance Training for more detail on income and rent requirements. Rent increases over those proposed in the project application must be approved by DHCD. Please note, initial and annual certification of income is required.

During the affordability period each project will be required to submit annual rent and occupancy reports and project financials. DHCD will verify through onsite monitoring compliance with rent, occupancy, property standards, and other programmatic requirements.

Section 504 applies to all ASNH assisted rental projects. Section 504 applies to certain new construction and rehabilitation projects, as follows:

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New Construction New construction of multifamily rental housing with five or more units must be designed and constructed to be readily accessible to and usable by persons with disabilities. The common areas in the building must be made accessible, as well as a certain number of units:

 A minimum of five percent of the dwelling units in the project (but not less than one unit) must be accessible to individuals with mobility impairments.  An additional two percent of the dwelling units (but not less than one unit) must be accessible to individuals with sensory impairments (i.e., hearing or vision impairments).

Rehabilitation: Substantial alterations Multifamily rental projects of fifteen units or more that undergo “substantial alterations” must also comply with Section 504’s accessibility requirements. Rehabilitation activities are considered “substantial alterations” when the costs of rehabilitation will be 75 percent or more of the replacement cost of the completed facility. For these projects, again, the common spaces must be made accessible as well as the same number of units required for new construction:

 A minimum of five percent of the dwelling units in the project (but not less than one unit) must be accessible to individuals with mobility impairments.  An additional two percent, at a minimum (but not less than one unit), must be

accessible to individuals with sensory impairments.

The requirements for multifamily projects undergoing substantial alterations are found at 24 CFR 8.23(a).

Rehabilitation: Other Alterations For rehabilitation of multifamily rental projects that do not meet the definition of substantial alterations, the alterations that are made must, to the maximum extent feasible, make the dwelling units accessible to and usable by individuals with mobility impairments. Further, if alterations of single elements or spaces of a dwelling unit, when considered together, amount to an alteration of a dwelling unit, then the entire dwelling unit shall be made accessible to persons with mobility impairments. (This would include alterations that involve certain kitchen and bathroom renovations, as well as entrance door jamb replacements.) In addition, alterations to common spaces must make those areas accessible, to the maximum extent feasible.

When a minimum of five percent of the dwelling units (but not less than one unit) are accessible to people with mobility impairments, no additional units are required to be made accessible. For this category of rehabilitation, there is no requirement to make any units accessible to individuals with sensory impairments.

A recipient is not required to make these accessibility alterations if doing so would impose undue financial and administrative burdens on the operation of the multifamily housing

project (24 CFR 8.23(b)).

Please note, that program agreements will reflect 504 units and require that any vacant 504 units are listed on Virginia Housing Search and held for at least 60 days before being leased to household not requiring a unit-specific accommodation. Tenant selection plans must also include 504 units.

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Homebuyer Projects Please note, homebuyer units assisted with HOME will automatically convert to HOME rental units if there is no ratified sales contract at nine months after the completion of construction (date of the Certificate of Occupancy). These projects are targeted to income eligible first-time homebuyers.

Project development teams must attend a project management conference based on a DHCD determined schedule. A program agreement must be executed within a year of the date of notification of the preliminary qualification of the project. This means that underwriting has been completed and all funding contingencies are resolved including the environmental review and release of funds. Please note, once the program agreement is executed any cost changes and/or changes in financing must be communicated in writing to and approved by DHCD. Changes will be reviewed and adjustments made to the underwriting analysis and program agreement as applicable. A deferred loan commitment will be issued once a program agreement has been executed to expire in one year from the date issued.

The project is complete when the last unit has closed and lien documentation and completion reports have been submitted and approved by DHCD. Please note that the length of each individual unit affordability period is based on the total amount of assistance in the particular unit and that the affordability period begins once closing and sale completion documentation has been submitted and approved by DHCD. Please see the Homebuyer recapture and resale section for more details. Non-compliance could suspend eligibility for additional funds and could result in the repayment of all funds to DHCD.

While final cost certification and completion reports are required at the end of the development phase and prior to the last draw, progress reports are required quarterly on each project during the development phase. Regular construction inspections will be conducted to verify progress.

The actual amount of assistance must be the minimum amount needed. Based on the investment the project will require a set number of HOME-assisted units. This is based on the proportion of total funds in the project compared to the total development costs. Total

development costs must exclude non- eligible cost.

Assisted units have income and value restrictions. Assisted units are limited to 80 percent AMI households who will be using the property as their primary residence.

Homebuyer projects can be structured as lease-purchase projects. These projects must be identified as lease-purchase in the application. Lease-purchase projects must convert to a tenant purchased unit (homebuyer unit) within three years. Units failing to meet this requirement will convert to rental unit for the duration of the affordability period. Please see the Compliance in HOME Rental Projects: Guide for Property Owners and HOME Rental Compliance Training for unit requirements. Developers considering this option are encouraged to consult with DHCD prior to application submission.

HOME –assisted homebuyer units will automatically convert to HOME rental units if there is no ratified sales contract at nine months after the completion of construction (date of the Certificate of Occupancy). HUD allows no exception to this requirement. This requires that all homebuyer

Virginia Affordable and Special Needs Housing: Program Guidelines 21 2020 - 2021 (revised October, 2020)

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projects have strong sales plans in place. There must be a pipeline of homebuyers and a demonstrated history in successfully completing homebuyer projects.

Housing must be modest (based on property sales price or value). No luxury homes or amenities (based on neighborhood standards) are allowed for assisted units. The sales price can NOT exceed 95 percent of median area purchase price (use HUD 203 (b) limits or local market survey).

Marketing Materials DHCD and the specific funding source(s) must be including on all marketing materials to include press releases, the project website, and signage. DHCD requires that a project sign be installed within thirty (30) days of the execution of the Agreement. Please see signage requirements for more details.

Virginia Affordable and Special Needs Housing: Program Guidelines 22 2020 - 2021 (revised October, 2020)

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The following is a summary of some key elements by funding source.

Summary of Key Requirements by Funding Source

HOME NHTF VA-HTF VA-PSH Total $7,547,851 $5,552,095 $16,680,000* $500,000 Available

Project Limits $700,000 – 900,000 $700,000 – 900,000 $700,000 – 900,000 $500,000

Geographic Preference for non- Statewide Statewide Statewide Target entitlement

Match 25% (entitlements None None None only) Mixed – Allowable Allowable Allowable Allowable Income

Homebuyer Allowable Ineligible Allowable Ineligible Projects Assisted 60% or below AMI 30% or below AMI 80% or below AMI 80% or Units 80% or below AMI below AMI (income) (homebuyer) Assisted HOME NHTF To be determined To be Units (Rents) determined

Affordability 15/20 yrs. Federal 30 yrs. 30 yrs Rental; 30 yrs.

Period Compliance 10/15 5 yrs Homebuyer State Compliance total of 30 yrs.

Homebuyer (5-20 yrs.) Group Homes Ineligible Ineligible Allowable (requires Allowable prior DHCD (requires consultation) prior DHCD consultation) *Estimated funding availability, subject to change.

Virginia Affordable and Special Needs Housing: Program Guidelines 23 2020 - 2021 (revised October, 2020)

[TABLE 23-1] | Summary of Key Requirements by Funding Source | | | | | | | HOME | NHTF | VA-HTF | VA-PSH | Total Available | | $7,547,851 | $5,552,095 | $16,680,000* | $500,000 | Project Limits | | $700,000 – 900,000 | $700,000 – 900,000 | $700,000 – 900,000 | $500,000 | Geographic Target | | Preference for non-entitlement | Statewide | Statewide | Statewide | Match | | 25% (entitlements only) | None | None | None | Mixed – Income | | Allowable | Allowable | Allowable | Allowable | Homebuyer Projects | | Allowable | Ineligible | Allowable | Ineligible | Assisted Units (income) | | 60% or below AMI 80% or below AMI (homebuyer) | 30% or below AMI | 80% or below AMI | 80% or below AMI | Assisted Units (Rents) | | HOME | NHTF | To be determined | To be determined | Affordability Period | | 15/20 yrs. Federal Compliance 10/15 State Compliance total of 30 yrs.

Homebuyer (5-20 yrs.) | 30 yrs. | 30 yrs Rental; 5 yrs Homebuyer | 30 yrs. | Group Homes | | Ineligible | Ineligible | Allowable (requires prior DHCD consultation) | Allowable (requires prior DHCD consultation) |

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Affordable and Special Needs Housing –Consolidated Application Program Guidelines

2020 - 2021 Application Due Dates: December 4, 2020 March 31, 2021

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Purpose The ASNH Program aims to create and preserve affordable housing in Virginia by providing financing to projects meeting local needs and supporting state housing policy.

This document provides guidance only. For detailed info or questions outside these guidelines, contact DHCD:

DHCD Affordable and Special Needs Housing Program Staff Michael Program Manager Michael.haas@dhcd.virginia.gov (804)212-5934 Haas Chloe Program Chloe.Rote@dhcd.virginia.gov (804)840-1909

Rote Administrator Loren Program Loren.brown@dhcd.virginia.gov (804)371-7024 Brown Administrator: Long Term Compliance

Background The ASNH Program is funded through a single competitive application for four funding sources.

These guidelines specify requirements for each funding source. While supporting statewide affordable housing, ASNH’s HOME funds favor projects in non-entitlement localities. Funding sources and amounts:

2020–2021 ASNH

Source Amount

HOME $7,547,851 National Housing Trust Fund $5,552,095

Virginia Housing Trust Fund $16,680,000*

State Permanent Supportive Housing $500,000

TOTAL $30,279,946 *Estimated funding availability, subject to change

HOME This program is funded through the federal HOME Investment Partnerships Program (HOME).

Created by the 1990 National Affordable Housing Act, HOME funds are allocated annually via formulas to states and PJs.

Virginia Affordable and Special Needs Housing: Program Guidelines 2 2020 - 2021 (revised October, 2020)

[TABLE 2-1] | DHCD Affordable and Special Needs Housing Program Staff | | | | Michael Haas | | Program Manager | Michael.haas@dhcd.virginia.gov | (804)212-5934 | Chloe Rote | | Program Administrator | Chloe.Rote@dhcd.virginia.gov | (804)840-1909 | Loren Brown | | Program Administrator: Long Term Compliance | Loren.brown@dhcd.virginia.gov | (804)371-7024 |

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[TABLE 2-2] | 2020–2021 ASNH | | | | | Source | | | Amount | | HOME | | | $7,547,851 | | National Housing Trust Fund | | | $5,552,095 | | Virginia Housing Trust Fund | | | $16,680,000* | | State Permanent Supportive Housing | | | $500,000 |

| TOTAL | | | $30,279,946 |

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PJs must conduct needs assessments, set priorities, and manage programs to meet goals. The ASNH program is part of the Commonwealth’s HOME Program.

Projects statewide are eligible, but priority is given to non-entitlement areas not receiving direct federal HOME allocations via PJs or Consortia.

CHDOs are preferred for HOME funding. See DHCD resources for CHDO requirements.

NHTF is a federal program administered by HUD via annual grants to states, with its first allocation starting in 2016.

Since 2016, NHTF supports affordable housing for extremely low-income households (≤30% AMI). Virginia allocates funds via a competitive process based on need, feasibility, and developer capacity.

Virginia HTF (Loan Pool) is funded by state funds to support housing needs and reduce homelessness, offering low-interest loans for projects serving households ≤80% AMI.

Virginia HTF expenditures for ASNH projects will fulfill the state’s federal HOME match.

and cannot be used for subsequent regulatory matches without DHCD approval.

PHS funds provide developer subsidies for new permanent supportive housing, combining affordable housing with wrap-around services for homeless and disabled individuals.

Up to $30.2 million in HOME, NHTF, Virginia HTF, and PSH funds will be available in 2020–2021 for projects selected via the ASNH consolidated application.

Applications are accepted twice yearly, with about half of the HOME, NHTF, and State Trust Funds allocated each round.

Virginia Affordable and Special Needs Housing: Program Guidelines 3 2020 - 2021 (revised October, 2020)

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Rounds (December 4, 2020, and March 31, 2021). Unobligated funding from the first round will be allocated through subsequent rounds with applications.

Developers may submit applications to DHCD by deadlines. All applications will be reviewed against criteria to identify projects meeting Virginia's priority housing needs. Unsuccessful applicants may request debriefings.

All funding applications must be submitted via CAMS. Allow up to two business days for help desk responses. Applications are due in CAMS by 11:59 PM on the deadlines below:

 December 4, 2020

 March 31, 2021

DHCD technical assistance is limited to normal business hours.

Applications must meet minimum requirements, including a score of at least 60 points, to be considered for funding. Scoring criteria are:

o Meeting local housing needs (40 percent); o Project feasibility (30 percent); and o Development team’s capacity to successfully complete the proposed project (30 percent).

Beginning activities before DHCD approval may jeopardize ASNH preliminary qualification.

Selected applications will receive written notification of preliminary qualification, valid for one year. DHCD may withdraw qualification based on project progress during this period.

All applicants must complete a Phase 1 ESA and a Part 58 ESA review before DHCD executes any HOME or NHTF agreement. Developers must not proceed with activities before agreement to avoid ineligibility.

Applicants must allow sufficient time to complete and forward all required environmental site assessment documentation to DHCD. Please note, coordination on the environmental review procedure is required if combining ASNH resources with CDBG or other federal funding such

as local HOME. Part 58 checklists must be submitted within six months of a HOME or NHTF award being made, and prior to any potentially choice limiting activities being undertaken. The Virginia Affordable and Special Needs Housing: Program Guidelines 4 2020 - 2021 (revised October, 2020)

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Checklists are available at: https://www.dhcd.virginia.gov/home-funds under “resources.”

Developers must meet with DHCD staff before issuing a program agreement. DHCD will schedule the conference. Participation is required for preliminary qualification.

Applicants with preliminary qualification must finalize and execute a program agreement before it expires in two years. A six-month extension may be granted with prior written request.

Developers cannot proceed with activities before executing the program agreement; doing so will render the project ineligible.

A program agreement is required for a formal loan commitment for permanent financing. Loan commitments generally expire 18 months after issue date.

Additional information is available in the Application Instructions and How to Apply Workshop.

DHCD targets ASNH statewide; projects in any Virginia locality are eligible for HOME, NHTF, and State HTF if addressing a critical local need supported by assessments or demand data.

DHCD favors projects in localities without direct HOME allocations, i.e., non-HUD PJs or HOME consortium members.

Projects in areas with a direct federal HOME allocation (entitlement areas or consortium members) must meet a local match requirement.

Projects proposed in these areas must have a local match for at least 25 percent of the total HOME Affordable Housing and Special Needs Housing Program loan request. Local match can include CDBG, HOME or other federal or state funds that are administered by the local government. This match can also be met based on the waiver of locally collected fees directly associated with the specific development (e.g., water and sewer connection fees).

Documentation of local match must be included in the application.

Virginia Affordable and Special Needs Housing: Program Guidelines 5 2020 - 2021 (revised October, 2020)

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HOME Entitlements and Consortiums – 25 percent Match Required Winchester Consortium – including: Alexandria Winchester Chesapeake

Fredrick County Danville Page County Hampton

Clarke County Lynchburg Warren County Newport News Shenandoah County Norfolk

Charlottesville Consortium - including Portsmouth Charlottesville Richmond Albemarle County Roanoke City

Fluvanna County Virginia Beach Greene County Arlington County Louisa County Chesterfield County

Nelson County Fairfax County -including New River Consortium– including Fairfax City Radford Falls Church

Giles County Henrico County Montgomery County Prince William County –including Pulaski County Manassas

Blacksburg Manassas Park Christiansburg Bristol City (member of Tennessee consortium) Suffolk Consortium –including

Suffolk Isle of Wight Franklin City

Southampton

Virginia Affordable and Special Needs Housing: Program Guidelines 6 2020 - 2021 (revised October, 2020)

[TABLE 6-1] HOME Entitlements and Consortiums – 25% Match Required | Winchester Consortium including: | Alexandria, Winchester, Chesapeake, Fredrick County, Danville, Page County, Hampton, Clarke County, Lynchburg, Warren County, Newport News, Shenandoah County, Norfolk, Charlottesville, Portsmouth, Charlottesville, Richmond, Albemarle County, Roanoke City, Fluvanna County, Virginia Beach, Greene County, Arlington County, Louisa County, Chesterfield County, Nelson County, Fairfax County, including New River Consortium, Fairfax City, Radford, Falls Church, Giles County, Henrico County, Montgomery County, Prince William County, including Pulaski County, Manassas, Blacksburg, Manassas Park, Christiansburg, Bristol City (Tennessee consortium), Suffolk, Isle of Wight, Franklin City, Southampton

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Eligible applicants are non-profit or for-profit housing developers, state-certified CHDOs, and public housing authorities seeking to develop affordable housing in Virginia.

The applicant (CAMS organizational profile) must be the owner, developer, or sponsor of the proposed project:

o Owner – holds valid legal title to, or long term leasehold interest in the property

o Developer – owns the property and is developing the project, or has a contractual obligation to develop the project

o Sponsor –is the owner or partial owner and agrees to convey ownership to a second non-profit at a predetermined time prior to or during development or upon completion (requires consultation with DHCD prior to application)

Applicants must have a registered CAMS profile. Applications must be submitted by the primary partner, not the project LLC. The applicant is responsible for long-term operations and compliance. Contact DHCD with questions.

DHCD will not enter into program agreements with any applicant with outstanding audit findings, IRS findings, DHCD monitoring findings or other compliance issues. Please note that DHCD will work with all interested parties to resolve any findings or compliance issues, where appropriate.

DHCD must verify project partner capacity and roles. Applicants must clearly explain all partners' roles in development, ownership, and management.

Assistance through ASNH is long-term, used to close financing gaps, and must be the minimum needed. Cash flow loans are not considered.

All rental applications must assume 3% interest-only deferred loans over the 30-year affordability period.

The HUD minimum affordability is 15 or 20 years, with the remaining years as a state extended compliance period. Refer to the next section for details.

Homebuyer projects are usually structured as construction financing, with draws based on completion milestones.

Virginia Affordable and Special Needs Housing: Program Guidelines 7 2020 - 2021 (revised October, 2020)

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Per project funding limits and total request caps are as follows: Per Fund Source Limits Project Type Maximum

Affordable Housing Projects $700,000 Project Including PSH $900,000 Total Request Cap

Total Request (not including NHTF) $1,400,000 Total Request (including NHTF) $2,000,000 Total Request Project including $2,400,000 PSH (Including PSH & NHTF) *See the Eligible Projects section for more details.

Caps include DHCD commitments from all rounds. DHCD may adjust offers by funding source and may exclude Vibrant Community Initiative requests from caps.

DHCD may charge actual project costs, including environmental notices and legal services, to the project.

DHCD costs are grants included in total project assistance, reflected in the deed, agreement, underwriting, and subsidy analysis.

HOME/NHTF unit requirements depend on total assistance (including ASNH and other sources) versus development costs, limited to eligible costs, excluding non-eligible items like community buildings and retail.

Match requirements, if applicable, apply to the total HOME loan amount.

only.

Any committed funds trigger a mandatory affordability period, enforced via deed covenant, based on project type and total assistance, including all HOME funds from all sources. DHCD determines required units during underwriting.

Virginia Affordable and Special Needs Housing: Program Guidelines 8 2020 - 2021 (revised October, 2020)

[TABLE 8-1] | Per Fund Source Limits | | Project Type | | Maximum | Affordable Housing Projects | | $700,000 | Project Including PSH | | $900,000 | | Total Request Cap | | Total Request (not including NHTF) | | $1,400,000 | Total Request (including NHTF) | | $2,000,000 | Total Request Project including PSH (Including PSH & NHTF) | | $2,400,000 |

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Affordability Periods by source/activity

Source/Activity Years

National HTF

National HFT (only rental eligible) 30 years

HOME

HOME Rental New Construction 20 years +10 years state compliance period, 30 total years

HOME Rental Rehabilitation 15 years+ 15 years state compliance period, 30 total years

HOME Homebuyer (less than $15,000)* 5 years

HOME Homebuyer ($15,000 - $40,000)* 10 years

HOME Homebuyer (more than $40,000)* 15 years State HTF/PSH

Virginia HTF/PSH Rental 30 years

Virginia HTF Homebuyer 5 years *If only homebuyer developer subsidy, a resale provision applies. If DHCD DPA is included in a unit then a recapture provision applies and affordability is based on the amount of DPA only.

Long-Term Compliance (Rental): Inspections within 12 months, then at least every 3 years. All must submit annual rent, occupancy, financials. Monitoring varies by risk.

Rental projects must meet program rent, occupancy, and property standards and other

Must meet federal/state requirements during affordability. No additional HOME/NHTF investments during this period. Non-compliance may lead to more monitoring, management changes, or transfer.

Long-Term Compliance (Homebuyer Projects) Resale Requirement: (Homebuyer Developer Subsidy Only) Homebuyer assisted units structured as only developer subsidy are subject to a resale provision. In these cases a resale provision applies where units must be resold to an income eligible homebuyer if within the applicable affordability period. The developer must monitor sales, foreclosures, and title transfers to assure affordability requirements. The developer Virginia Affordable and Special Needs Housing: Program Guidelines 9 2020 - 2021 (revised October, 2020)

[TABLE 9-1] | Affordability Periods by source/activity | | | | | Source/Activity | | | Years | | National HTF | | | | | National HFT (only rental eligible) | | | 30 years | | HOME | | | | HOME Rental New Construction | | | | 20 years +10 years state | | | | | compliance period, 30 total | | | | | years | HOME Rental Rehabilitation | | | | 15 years+ 15 years state | | | | | compliance period, 30 total | | | | | years | | HOME Homebuyer (less than $15,000)* | | | 5 years | | HOME Homebuyer ($15,000 - $40,000)* | | | 10 years | | HOME Homebuyer (more than $40,000)* | | | 15 years | | State HTF/PSH | | | | | Virginia HTF/PSH Rental | | | 30 years | | Virginia HTF Homebuyer | | | 5 years |

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Resale requirements apply if housing ceases to be principal residence during the affordability period. Resale must be to low-income, principal residence buyers, ensuring fair return and affordability based on funds invested.

Fair return on investment is based on resale price covering initial investment plus capital improvements, adjusted by area median sales price changes, ensuring fair seller return and affordability.

The program measures median sales price changes over ownership to set resale prices, ensuring fair return and affordability, even in declining markets, reducing subsidy needs.

A capital improvement is any addition or alteration meeting the following conditions:

 It substantially adds to the value of the real property, or appreciably prolongs the useful life of the real property; and

 It becomes part of the real property or is permanently affixed to the real property so that removal would cause material damage to the property or article itself.

Capital improvement value is based on national average increase; example: downpayment $5K, improvements $9K, appreciation 3.5%, total return $14,490.

A “reasonable range” is households ≤80% AMI paying ≤30% income for principal, interest, taxes, insurance.

DHCD will impose resale and affordability via deed restrictions, covenants, or similar mechanisms as per §92.254(a)(5)(i)(A) of the HOME Rule. The developer may use

Virginia Affordable and Special Needs Housing: Program Guidelines 10 2020 - 2021 (revised October, 2020)

[TABLE 10-1]  It substantially adds value or prolongs the useful life of the property;  It becomes part of or is permanently affixed to the property, removal causing material damage.

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Purchase options, rights of first refusal, or preemptive rights to preserve affordability. Restrictions revive if owner gains interest during the original period.

Recapture Provision: Direct Buyer Assistance ASNH Homebuyer HOME-assisted units, including DHCD HOME DPA, are subject to recapture to ensure units remain affordable or DHCD recovers its investment. Recapture is limited to the direct buyer assistance amount.

Virginia will use §92.254(a)(5)(ii) to recapture the full amount from net proceeds upon sale, refinance (see exception), foreclosure, or failure to maintain primary residency before the affordability period ends.

The total assistance from net proceeds is payable in full to DHCD/Treasurer of Virginia. Assistance cannot be subordinated to refinancing or equity loans during the affordability period, except under hardship at DHCD’s discretion. Requirements are secured by a Restricted Deed of Covenant for the assistance amount.

The loan is forgiven in full at the end of the affordability period.

Developer Requirements Federal regulations require DHCD to certify developer capacity (including CHDOs) prior to the commitment of HOME or NHTF funds. Developer capacity requirements include:  Experience developing similar projects  Staff with development experience (excludes consultants, contractors or partners)  Current financial soundness

Capacity is evaluated for all applicants, including those seeking state resources. DHCD aims to select high-quality projects; applicants must demonstrate success with similar projects and financial health for project completion and compliance.

Please note that preference for HOME funding is given to CHDO’s. DHCD must confirm at application that the CHDO meets CHDO organizational and mission requirements. These include:  Nonprofit status  Primary mission provision of affordable housing  Board composition meets HUD requirements

 Independence in decision making authority  Community based organization  Financial soundness

Virginia Affordable and Special Needs Housing: Program Guidelines 11 2020 - 2021 (revised October, 2020)

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CHDOs with existing ASNH projects must confirm ongoing compliance with organizational and mission requirements in subsequent applications; documentation must be uploaded and maintained in CAMS.

CHDOs receive funding preference for HOME funds. Organizations meeting CHDO requirements may apply by uploading documentation in CAMS. Refer to CHDO Survival Kit and Self-Assessment Tool for details.

CHDOs must also meet financial management and capacity requirements. These include:  Conformance to accounting standards  No individual benefit  Demonstrated capacity to develop affordable housing

CHDO requirements must be met at the time of fund commitment, for the duration of the development phase, and through the long-term compliance period for CHDO’s in the role of project/property owner. Please see CHDO Survival Kit and CHDO Capacity Self-Assessment Tool for more details.

Eligible projects produce or preserve affordable units for low-income homeowners or renters, with at least five units (unless 100% special needs), under common ownership, management, and financing. Minimum total investment per unit is $15,000 or includes major system replacements, not exceeding actual costs or 221(d)(3) limit. Projects will be assisted with minimum necessary funds.

When HOME/NHTF resources are invested, the total amount of HOME/NHTF is

Limited to the 221(d)(3) HOME maximum per unit subsidy limits:

Maximum Subsidy Limit (HOME/NHTF) (effective July 14, 2020) Bedrooms Limits 0 $153,314 1 $175,752 2 $213,718 3 $276,482 4+ $303,490

Projects must be either rental or homebuyer (not both), targeting income-eligible households. Homebuyer projects need at least five units at 80% or below AMI; rental projects require at least

At least five units (unless 100% special needs) targeting 60% or below AMI; at least 20% of HOME units target 50% or below; all NHTF units target 30% or below AMI. Projects with greater lower-income targeting will be prioritized.

Virginia Affordable and Special Needs Housing: Program Guidelines 12 2020 - 2021 (revised October, 2020)

[TABLE 12-1] | Maximum Subsidy Limit (HOME/NHTF) | | | (effective July 14, 2020) | | Bedrooms | | Limits | 0 | | $153,314 | 1 | | $175,752 | 2 | | $213,718 | 3 | | $276,482 | 4+ | | $303,490 |

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Preference is given based on need criteria; DHCD will determine the number of assisted units and income mix during underwriting.

Projects must address local market needs, vacancy rates, and gaps in affordable housing. DHCD will evaluate and certify this based on a market analysis.

Both new construction and substantial rehabilitation projects are eligible. Development activity beyond the original footprint will be considered new construction. In either case, construction and property standards (DHCD’s Minimum Design, Construction, and Rehab Requirements) must be met to assure that no further investment is required during the affordability period.

ASNH assistance cannot be used for acquisition-only projects, public housing, facilities (including shelters, group homes—possible exception for Virginia HTF), hospitals, nursing homes, or assisted living. Also, HOME

Assistance is prohibited in projects with prior HOME assistance from any source during the affordability period.

Group homes may be eligible for Virginia HTF assistance in limited cases with identified local need; pre-application consultation with DHCD is required.

Eligible properties include multi-unit, single-family, 2-4 unit structures, and manufactured homes; units must be modest relative to the neighborhood.

Assisted projects should be located to reduce poverty and minority concentration. Applicants must submit a Site and Neighborhood Standards form for DHCD review, including project location info:

 Is located on adequate and accessible site  Furthers compliance with fair housing laws  Is on a site that is: o Not in minority concentration or racially mixed area OR o In racially mixed area but will not increase the minority concentration OR o In area of minority concentration but:  Sufficient comparable opportunities exist outside of the area for minorities OR  Necessary to meet overriding housing need that cannot otherwise be met (integral to preservation strategy OR integral to revitalizing area strategy)

 Promotes greater choice of housing opportunities and avoids undue concentration of assisted persons  Is in a neighborhood that is not detrimental to family life  Is in a location with comparable access to services and facilities Virginia Affordable and Special Needs Housing: Program Guidelines 13 2020 - 2021 (revised October, 2020)

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 Is in a location where travel/access to jobs is not excessive (not applicable to elderly housing)

Projects in high-poverty or minority areas must show they are in a revitalization zone.

Development costs are limited to eligible expenses, excluding non-eligible items like community buildings, market-rate units, and retail. Mixed-income projects are eligible if they include assisted units meeting income and rent/sales criteria. Requirements depend on total assistance (including HOME) relative to costs.

Scattered site projects are permitted if under common ownership, management, and financing.

Projects may include SRO units—single-room dwellings for one household with food prep and/or sanitary facilities. If not in the unit, the building must provide access.

Projects may include PSH units for chronically homeless (per HUD), IDD, SMI, veterans, formerly homeless, and elderly. These are not counted toward the higher PSH cap.

Unit Type Subpopulations Project Maximum PSH Chronically $900,000 Project Cap;

Homeless/SMI/IDD Scoring Preference PSH All other subpopulations $700,000 Project Cap;

Special Needs Populations scoring preference—$700,000 cap;

Without wrap around Scoring Preference services

Fair housing compliance applies; tenants must have leases; participation in services cannot be required; applications are evaluated partly on need.

Virginia Affordable and Special Needs Housing: Program Guidelines 14 2020 - 2021 (revised October, 2020)

[TABLE 14-1] | Unit Type | | | Subpopulations | | | Project Maximum | PSH | | | Chronically Homeless/SMI/IDD | | | $900,000 Project Cap;

Scoring Preference | | PSH | | | All other subpopulations | | | $700,000 Project Cap;

Scoring Preference | | Special Needs Populations: Without wrap around services | | | All other subpopulations | | | $700,000 Project Cap;

Scoring Preference | |

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DHCD promotes accessible units and favors projects exceeding Section 504 minimum accessibility requirements.

Minimum Requirement Unit Type Number of Units Physically Impaired Assessibility Five percent of units (minimum of one) Sensory Impaired Assessibility Two percent of units (minimum of one)

Accessible units must be equitably distributed within the project and unit types.

Program agreements will specify accessible units; vacant units must be listed on Virginia Housing Search and held 60 days before leasing to non-eligible households. Tenant plans must include these units.

Accessible units are a type; special needs households may or may not need them. They are scored separately from PSH units.

PSH is a statewide initiative connecting eligible individuals with affordable housing. Projects choosing to

Projects reserving PSH units must have a formal MOA/MOU with a service/referral agency (e.g., DBHDS, local health, CSBs, continuum of care) at application.

Projects reserving PSH units targeting chronically homeless, SMI, or I/DD households may receive scoring preference and up to $900,000 funding.

Vacant PSH units must be offered to eligible families and referenced in the Tenant Selection Plan.

must be held open for a minimum of 60 days upon vacancy, and may only be filled by a non-PSH household if no eligible PSH households are referred within that 60 day period. PSH designated units in properties of 25 units or less must be held open for a minimum of 30 days Virginia Affordable and Special Needs Housing: Program Guidelines 15 2020 - 2021 (revised October, 2020)

[TABLE 15-1] | Minimum Requirement | | Unit Type | | Number of Units | Physically Impaired Assessibility | | Five percent of units (minimum of one) | Sensory Impaired Assessibility | | Two percent of units (minimum of one) |

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Vacant PSH units must be offered to eligible households for 30 days; only non-PSH if no referral. Tax credit projects follow their policies.

If the MOA cannot be renewed, the property must seek a new referral and service partner.

$900,000 limit applies to projects targeting priority PSH populations; DHCD supports and favors projects serving other special needs populations with scoring preferences.

Special needs and PSH units targeting extremely low-income (30% below AMI) households must support DHCD’s goals for mixed-income, integrated housing. Preference is given to projects serving these populations that leverage rental assistance.

Program agreements will reflect special needs units, requiring vacant accessible units to be listed on Virginia Housing Search and held 60 days before leasing to non-special needs households. Tenant plans must include these units.

Applicants cannot propose targeting units if other funding resources prohibit it.

Green Built Preference Projects including Green Building standards are encouraged. Preference is given to projects with third-party certification.

The Fair Housing Act prohibits discrimination in housing sales or rentals based on race, color, religion, sex, national origin, handicap, or familial status. This applies to all ASNH projects. Projects that discriminate or are structured to

discriminate are ineligible.

Lead Safe Housing policies apply to ASNH projects. Some may be exempt. For others, appropriate measures must ensure:

 Rehabilitation or demolition activities meet lead safe requirements;  Development costs include associated costs;  Homebuyers or tenants will receive notification (if applicable);  Operating costs include ongoing associated maintenance costs for rental projects; and  Records are maintained to document all measures taking.

Environmental measures apply to all assisted projects. All projects will require an Environmental Phase one Site Assessment. Projects receiving HOME and/or NHTF will require an additional Environmental Part 58 review. This must be completed, reviewed, and approved by DHCD. The process requires public notifications and a HUD approval of the release of funding. No development activity including the acquisition of the property can Virginia Affordable and Special Needs Housing: Program Guidelines 16 2020 - 2021 (revised October, 2020)

• Page 17 ---

occur prior to the release of funds. Any project where development activity has occurred prior to the release of funds is ineligible.

Environmental review coordination is required for projects combining State HOME, local HOME, or CDBG funds.

Relocation accommodations are required for all funding sources. URA applies to all HOME/NHTF projects causing dislocation. When dislocation is possible, notices and occupant surveys must be completed before application, including URA forms and documentation. Development costs must include related costs.

Section 3 applies to all HOME/NHTF projects, requiring opportunities benefit low/very low income persons and their employers. Developers must set goals, develop a plan, and comply with notifications, documentation, and annual DHCD reporting via CAMS.

Labor Standards apply to all projects, requiring workers to receive 1.5x pay for hours over 40 weekly. Projects with 12+ HOME units must meet Davis-Bacon and Anti-Kickback Act requirements, based on the proportion of HOME funds to total costs, with weekly prevailing wages paid without deductions.

deductions or rebates except permissible deductions. Reporting requirements include the payroll submissions.

The Violence Against Women Act applies to all projects, providing housing protections for survivors of domestic violence, sexual assault, and stalking. Tenants must be notified of their rights, including emergency transfers, lease bifurcation, protections against denials, evictions, and a low-barrier certification process.

CAMS Requirements: Developers must meet project management and reporting requirements in DHCD’s Centralized Application and Management System.

ASNH funding applications must be submitted in CAMS. Selected projects must submit documentation, including Section 3 reports and quarterly progress reports. Note that it is the

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responsibility of the project developer/sponsor to log in to CAMS on a regular basis. CAMS will be the record for any project funded through the ASNH program. Preliminary qualifications letters, program agreements, inspections reports, and other project documentation will all be maintained in CAMS.

Eligible costs, regardless of assistance form (permanent financing or construction draws), must be allowable for all funded development costs.

Specifically the following costs are allowable:  Demolition costs are eligible costs, however construction must begin within 12 months  Construction, labor, and materials  Project development related costs (e.g., financing fees, legal fees, affirmative action

marketing)  Up to 18 months rental project operating deficit reserve  Relocation (can pay for relocation costs for any household in project as a part of the overall project development costs)

The following are ineligible costs:  HOME/NHTF investments not resulting in HOME/NHTF eligible units  Project reserves other than the rental operating (listed above)  Operating reserves (rental) are limited to 18 months - operating reserves beyond 18 months are ineligible

 This assistance cannot be used for the development, operation, or modernization of any public housing  Project-based rental assistance is a prohibited expense  Delinquent taxes, fees, charges cannot be paid  Items not allowed under 2 CFR 200 or not deemed cost reasonable (see the Resources and References section for more details)  Some specific costs related to RAD (Rental Assistance Demonstration) projects

Assisted units are determined during underwriting, limited to households at or below AMI, based on HUD’s Section 8 standards. Projects must be

able to provide a set number of assisted units.

Homebuyer units must be at or below 80% AMI at eligibility, which expires after six months; if no closing, eligibility must be re-established.

HOME-assisted rental units must be at or below 60% AMI at initial occupancy, with the number determined during underwriting. At least 20% must be at or below 50% AMI.

NHTF-assisted units must be at or below 30% AMI.

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All State HTF projects must be at 80% or below AMI; applies to rental and homeownership.

Rental Projects: Development teams must attend a DHCD-scheduled conference. A program agreement must be signed within a year of preliminary qualification notification, after underwriting and contingencies are resolved. Cost or financing changes require written DHCD approval; adjustments will be made accordingly.

Final cost certification and completion reports are due at closing; quarterly progress reports and inspections are required during development.

Affordability periods start after DHCD approves completion reports, lease-up data, and inspections. Non-compliance may suspend future funding and require repayment.

Assistance must be the minimum needed to produce or preserve an affordable unit. All assisted rental projects have affordability periods based on assistance type.

The project requires a set number of assisted units based on the proportion of ASNH investment to total development costs.

Total development costs must exclude non-eligible costs.

Assisted units have income and rent restrictions. HOME-assisted units are limited to 50 or 60 percent AMI at initial occupancy (NHTF are limited to 30 percent AMI). Rents for the units are restricted to the Low or High HOME (or NHTF) rents for the area. Rents cannot exceed the HOME/NHTF rents, with the exception of project-based rental assistance. Please see the Compliance in HOME Rental Projects: Guide for Property Owners and HOME Rental Compliance Training for more detail on income and rent requirements. Rent increases over those proposed in the project application must be approved by DHCD. Please note, initial and annual certification of income is required.

During the affordability period, annual rent, occupancy, and financial reports are required. DHCD will conduct onsite monitoring for compliance.

Section 504 applies to all ASNH assisted rental projects, including certain new construction and rehabilitation.

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New construction of multifamily rental housing (5+ units) must be accessible to persons with disabilities, including common areas and a minimum number of units:

 A minimum of five percent of the dwelling units in the project (but not less than one unit) must be accessible to individuals with mobility impairments.  An additional two percent of the dwelling units (but not less than one unit) must be accessible to individuals with sensory impairments (i.e., hearing or vision impairments).

Rehabilitation of 15+ units with substantial alterations (cost ≥75% of replacement) must meet Section 504 accessibility, including accessible common areas and units as in new construction.

 A minimum of five percent of the dwelling units in the project (but not less than one unit) must be accessible to individuals with mobility impairments.  An additional two percent, at a minimum (but not less than one unit), must be

accessible to individuals with sensory impairments.

Requirements for substantial alterations are at 24 CFR 8.23(a).

For non-substantial rehab, alterations must, to the extent feasible, make units and common areas accessible for mobility impairments; if alterations of elements total a unit, the whole must be accessible.

If ≥5% (min 1) units are accessible for mobility impairments, no further units need accessibility; no sensory unit requirement applies.

A recipient is not required to make these accessibility alterations if doing so would impose undue financial and administrative burdens on the operation of the multifamily housing

project (24 CFR 8.23(b)).

Program agreements will specify 504 units, which must be listed on Virginia Housing Search and held 60 days before leasing to households without accommodations. Tenant plans must include 504 units.

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Homebuyer units assisted with HOME will convert to rental if no ratified sales contract exists after 9 months post-construction (Certificate of Occupancy). Projects target income-eligible first-time buyers.

Teams must attend a DHCD conference. A program agreement must be signed within a year of preliminary qualification, after underwriting and contingencies are resolved. Cost or financing changes require DHCD approval; a deferred loan will be issued upon agreement, valid for one year.

Project is complete when all units close, lien docs and reports are approved. Affordability begins after sale docs are approved; non-compliance may suspend funds and require repayment.

Final cost certification and reports are due at phase end; quarterly progress reports and inspections are required during development.

Assistance must be the minimum needed. The project requires a set number of HOME units based on the proportion of funds to total development costs.

development costs must exclude non- eligible cost.

Assisted units have income and value restrictions; limited to 80% AMI households using the property as primary residence.

Homebuyer projects may be lease-purchase, identified in application, converting to homebuyer units within three years; otherwise, they convert to rental units during the affordability period. Developers should consult DHCD before applying.

HOME-assisted homebuyer units automatically convert to rental if no ratified sales contract exists at nine months post-construction; HUD allows no exceptions.

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Projects must have strong sales plans, a homebuyer pipeline, and a history of successful homebuyer projects.

Housing must be modest; luxury homes or amenities are not allowed. Sales price cannot exceed 95% of median area purchase price (HUD 203(b) limits or local survey).

DHCD and funding source(s) must be included on all marketing materials, including press releases, website, and signage. A project sign must be installed within 30 days of Agreement execution.

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Summary of key elements by funding source.

Key Requirements by Funding Source

HOME NHTF VA-HTF VA-PSH Total $7,547,851 $5,552,095 $16,680,000* $500,000 Available

Project Limits $700,000 – 900,000 $700,000 – 900,000 $700,000 – 900,000 $500,000

Geographic Preference for non- Statewide Statewide Statewide Target entitlement

Match 25% (entitlements None None None only) Mixed – Allowable Allowable Allowable Allowable Income

Homebuyer Allowable Ineligible Allowable Ineligible Projects Assisted 60% or below AMI 30% or below AMI 80% or below AMI 80% or Units 80% or below AMI below AMI (income) (homebuyer) Assisted HOME NHTF To be determined To be Units (Rents) determined

Affordability 15/20 yrs. Federal 30 yrs. 30 yrs Rental; 30 yrs.

Period Compliance 10/15 5 yrs Homebuyer State Compliance total of 30 yrs.

Homebuyer (5-20 yrs.) Group Homes Ineligible Ineligible Allowable (requires Allowable prior DHCD (requires consultation) prior DHCD consultation) *Estimated funding availability, subject to change.

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[TABLE 23-1] | Summary of Key Requirements by Funding Source | | | | | | | HOME | NHTF | VA-HTF | VA-PSH | Total Available | | $7,547,851 | $5,552,095 | $16,680,000* | $500,000 | Project Limits | | $700,000 – 900,000 | $700,000 – 900,000 | $700,000 – 900,000 | $500,000 | Geographic Target | | Preference for non-entitlement | Statewide | Statewide | Statewide | Match | | 25% (entitlements only) | None | None | None | Mixed – Income | | Allowable | Allowable | Allowable | Allowable | Homebuyer Projects | | Allowable | Ineligible | Allowable | Ineligible | Assisted Units (income) | | 60% or below AMI 80% or below AMI (homebuyer) | 30% or below AMI | 80% or below AMI | 80% or below AMI | Assisted Units (Rents) | | HOME | NHTF | To be determined | To be determined | Affordability Period | | 15/20 yrs. Federal Compliance 10/15 State Compliance total of 30 yrs.

Homebuyer (5-20 yrs.) | 30 yrs. | 30 yrs Rental; 5 yrs Homebuyer | 30 yrs. | Group Homes | | Ineligible | Ineligible | Allowable (requires prior DHCD consultation) | Allowable (requires prior DHCD consultation) |

[/TABLE]

Virginia Homeless and Special Needs Housing

Funding Guidelines

2022 - 2024Table of Contents

Virginia Department of Housing and Community Development .................................................. 4 Homeless and Special Needs Housing Grant Programs ............................................................ 4 Homeless and Special Needs Housing Grantee Requirements .................................................. 5 Service Provider .................................................................................................................................... 6 Service Coordinator .............................................................................................................................. 6 Fiscal Agent........................................................................................................................................... 6 Continuum of Care (CoC)/Local Planning Group (LPG) Point-in-Time Count Date Coordination ....... 6 Participation in CoC/LPG ...................................................................................................................... 6 Non-Discrimination in Housing and Community Development Programs ............................................ 6 Equal Access and Prohibited Inquiries ................................................................................................. 7 Discharge Coordination ......................................................................................................................... 7 Compliance with Fair Housing and Civil Rights Laws ........................................................................... 8 Confidentiality Policy ............................................................................................................................. 8 Grievance and Termination Policy ........................................................................................................ 8 Recordkeeping ...................................................................................................................................... 9 Data Reporting Requirements ............................................................................................................... 9 HMIS ..................................................................................................................................................... 9 DUNS Number .................................................................................................................................... 10 System for Award Management (SAM) .............................................................................................. 10 Method of Payment ............................................................................................................................. 10 Financial Management ........................................................................................................................ 10 Time Sheets ........................................................................................................................................ 12 Hazard Pay .......................................................................................................................................... 12 Accounting Standards ......................................................................................................................... 12 Internal Controls .................................................................................................................................. 13 Monitoring ............................................................................................................................................ 13 Conflicts of Interest ............................................................................................................................. 13 Property Standards ............................................................................................................................. 14 Nondiscrimination and Equal Opportunity Requirements ................................................................... 15 Affirmatively Furthering Fair Housing .................................................................................................. 15 HSNH Ineligible and Prohibited Activities ........................................................................................... 15 Emergency Crisis Response System ........................................................................................16 What Is a Crisis Response System? ................................................................................................... 16 Role of the CoC/LPG ................................................................................................................17 Responsibilities ................................................................................................................................... 17 Governance and structure ................................................................................................................... 17 System coordination and planning ...................................................................................................... 17 Designating and operating HMIS ........................................................................................................ 17 Coordinated entry ................................................................................................................................ 17

HSNH 2022 – 2024 2 Back to topVirginia Homeless Solutions Program .......................................................................................18 Key Outputs and Performance Measures ........................................................................................... 18 VHSP Funding .................................................................................................................................... 18 Grant Award Funding .......................................................................................................................... 19 Match Requirement ............................................................................................................................. 19 Grantee Requirements ........................................................................................................................ 19 Eligible Service Areas ......................................................................................................................... 22 Eligible Activities ................................................................................................................................. 22 Outreach ............................................................................................................................................. 23 Centralized or Coordinated Assessment/Entry System ...................................................................... 24 VHSP Participant Initial Eligibility ........................................................................................................ 26 Targeted Prevention ........................................................................................................................... 26 Emergency Shelter Operations ........................................................................................................... 31 Rapid Re-housing ............................................................................................................................... 33 CoC/LPG Planning (limited to ten percent of total VHSP base budget) ............................................. 39 HMIS (limited to five percent of total VHSP base budget) .................................................................. 39 Administrative Costs (limited to five percent of total VHSP base budget) .......................................... 40 Housing Opportunities for Persons With AIDS (HOPWA) ..........................................................41 Eligible Service Areas ......................................................................................................................... 41 Grantee Requirements ........................................................................................................................ 42 Project Participant Eligibility ................................................................................................................ 43 Eligible Activities ................................................................................................................................. 45 Tenant-based Rental Assistance (TBRA) ........................................................................................... 45 Short-term Rent, Mortgage, and Utility (STRMU) Assistance ............................................................ 46 Supportive Services ............................................................................................................................ 48 Permanent Housing Placement .......................................................................................................... 49 Housing Information Services (limited to three percent of total HOPWA budget) ............................. 49 Administrative Costs (limited to seven percent of total HOPWA budget) ........................................... 50 Virginia Housing Trust Fund: Homeless Reduction Grant .........................................................51 Eligible Grantees ................................................................................................................................. 51 Grantee Requirements ........................................................................................................................ 51 Eligible Activities ................................................................................................................................. 51 Rapid Re-housing ............................................................................................................................... 51 Underserved Populations Innovation Project ...................................................................................... 56 Permanent Supportive Housing (Housing Stabilization Services and Rental Assistance for Chronic Homeless) ........................................................................................................................................... 67 Administrative Costs (limited to three percent of total HTF-HRG budget) .......................................... 71 Homeless and Special Needs Housing Grants – Amendments .................................................72

HSNH 2022 – 2024 3 Back to topVirginia Department of Housing and Community Development The Virginia Department of Housing and Community Development (DHCD) partners with state, federal, local and nonprofit housing and community and economic development initiatives.

DHCD programs strive to maintain the vibrancy of communities throughout the Commonwealth and include providing universal broadband access, investing in economic development initiatives, promulgating the statewide building and fire regulations, preserving the affordability and efficiency of Virginia’s homes and buildings, addressing homelessness, reducing eviction rates across the state and fostering innovative solutions to create affordable housing. DHCD invests over $350 million annually in addition to $2 billion in federal recovery programs as a partner to Virginia communities to create safe, affordable and prosperous communities to live, work and do business in Virginia.

Homeless and Special Needs Housing Grant Programs The mission of the Homeless and Special Needs Housing unit (HSNH) within DHCD is to ensure homelessness is rare, brief, and one-time. To that end, HSNH administers a continuum of state- and federally-funded homeless service programs to address housing and stabilization services for individuals and families at-risk of or experiencing homelessness in the commonwealth. HSNH works closely with communities and an array of service providers including nonprofits, units of local government, and housing authorities, to ensure comprehensive homeless services are provided effectively and efficiently in accordance with best-practice models to maximize limited resources.

HSNH administers three grant programs:

Virginia Homeless Solutions Program Virginia Homeless Solutions Program (VHSP) funding supports the development and implementation of localized emergency crisis response systems, to ensure homelessness is rare, brief, and one-time through coordinated community-based activities. Through a housing-focused approach, the goals of VHSP are to assist households experiencing homelessness to quickly regain stability in permanent housing and to prevent households from becoming homeless. These activities are designed to reduce the overall length of homelessness in the community, the number of households becoming homeless, and the overall rate of formerly homeless households returning to homelessness.

Housing Opportunities for Persons With AIDS The Housing Opportunities for Persons With AIDS (HOPWA) program is U.S. Department of Housing and Urban Development (HUD) funding dedicated to the housing needs of people living with HIV/AIDS. DHCD administers the program by granting funds to nonprofits and local governments to provide housing and services that benefit low-income persons living with HIV/AIDS and their families.

Virginia Housing Trust Fund The goal of the Virginia Housing Trust Fund Homeless Reduction Grant (HTF-HRG) is to reduce homelessness in the Commonwealth of Virginia. DHCD will support continuum of care (CoC)/balance of state local planning group (LPG) strategies and homeless service projects that are a part of an effective emergency crisis response system in communities to ensure that homelessness is rare, brief, and one-time.

• FY 2023 HSNH Administered Funding VHSP HOPWA HTF Homeless Reduction Grant $15,075,392 $1,375,014 $8,300,000 * Actual funding levels have not been determined at the writing of this document and could vary significantly from estimated amounts.

HSNH 2022 – 2024 4 Back to topHomeless and Special Needs Housing Grantee Requirements Grantees must comply with program guidelines and applicable state and federal policies and procedures, including compliance with non-discrimination laws. In addition to the grantee requirements below, grantees must adhere to the requirements for the specific funding streams.

Organizations funded by HSNH grant programs (direct grantees and sub-contractors) may not engage in inherently religious activities, such as worship, religious instruction, or proselytization as part of the programs or services funded under HSNH. If an organization conducts these activities, then they must be offered separately, in time or location, from the programs or services funded under HSNH and participation must be voluntary for project participants.

Grantees must have established standard accounting practices including internal controls, fiscal accounting procedures, and cost allocation plans as well as track agency and program budgets by revenue sources and expenses.

Grantees with outstanding audit findings, IRS findings, DHCD monitoring findings, or other compliance issues are not eligible to receive funding. Grantees will not be eligible to receive allocations if any of these conditions occur within the grant period. DHCD will work with all interested parties where appropriate, to resolve findings and compliance issues.

Proposed grantees without recent DHCD funding agreements will be subject to an organizational assessment prior to the execution of any DHCD funding agreement. Recent funding agreements must have been executed since July 1, 2017 for any HSNH funding program. An assessment includes a review of organization finances, accounting standards, internal controls, grievance policies, record keeping policies, confidentiality practices, conflict of interest policies, and fair housing practices. DHCD reserves the right to require and conduct organizational assessments of any proposed grantee prior to the execution of any agreement.

All proposed grantees must be registered in DHCD’s Centralized Application and Management System (CAMS) and are required to submit one of the following financial documents: Financial Statement*; Reviewed Financial Statement prepared by an independent Certified Public Accountant (CPA); Audited Financial Statement prepared by an independent CPA; or, an OMB A-133 Audit (Single Audit) prepared by an independent CPA. See the table below to determine which document your organization is required to submit.

The threshold requirements outlined below are the minimal standards required by DHCD. All organizations funded by DHCD are encouraged to undertake the highest level of financial management review to ensure practices and procedures are fully examined and evaluated.

Threshold Requirement Document Total annual expenditures ≤ $100,000, Financial Statement prepared by organization regardless of source (does not require preparation by a CPA) Total annual expenditure between Reviewed Financial Statement prepared by an $100,001 and $300,000, regardless of Independent Certified Public Accountant (CPA) source Total annual expenditures > $300,000, Audited Financial Statement prepared by an regardless of source Independent CPA 2 CFR 200 Subpart F Audit - prepared by an Federal expenditures ≥ $750,000 Independent CPA

Entities shall file the required financial document in the Centralized Application and Management System (CAMS) within nine (9) months after the end of their fiscal year or 30 days after it has been accepted (Reviewed Financial Statement, Audited Financial Statement, and OMB A-133 Audit only) - whichever comes first.

HSNH 2022 – 2024 5 Back to topThe full DHCD Audit Policy, including an explanation of the specific document requirements, can be found online at https://www.dhcd.virginia.gov/sites/default/files/Docx/audit-policy/dhcd-audit-policy.pdf.

Eligible grantees are the organizations that DHCD contracts with for the provision of eligible activities. These organizations are identified during the grant application process and are designated as the:  Service Provider(s)  Service Coordinator, and/or  Fiscal Agent

Service Provider These are the individual organizations identified in the HSNH application to provide the eligible activities. This would also include a Homeless Management Information System (HMIS) administrator, if applicable.

Service Coordinator One or more service providers may collaborate to provide specific services. In this case, DHCD will consider contracting with the service coordinator. The service coordinator is a service provider in the collaboration. The application must clearly explain how the service providers will work together. Written agreements are required between services providers involved in the coordinated effort. Copies of the related written agreements or Memoranda of Understanding (MOUs) must be submitted as an attachment with the application. The service coordinator (grantee) assumes full responsibility for meeting all HMIS, reporting, record keeping, spending, and other program requirements. These responsibilities include monitoring each service provider included in the coordinated effort for program compliance. This role is limited to organizations with demonstrated capacity.

Fiscal Agent DHCD will consider contracting with organizations as fiscal agents. In this case, the organization does not directly provide any services covered by the DHCD contract. However, all remittances, documentation requirements, and other program responsibilities must be maintained by the fiscal agent. The fiscal agent assumes full responsibility for meeting all HMIS reporting, record keeping, spending, and other program requirements. These responsibilities include monitoring each service provider providing any services or activities funded through the application process. This role is limited to organizations with demonstrated capacity.

Continuum of Care (CoC)/Local Planning Group (LPG) Point-in-Time Count Date Coordination Each CoC and LPG must conduct the annual point-in-time (PIT) count on the date designated by the state.

Participation in CoC/LPG CoC/LPG participation in accordance with the community’s bylaws and standards is required.

Non-Discrimination in Housing and Community Development Programs Federal laws prohibit discrimination in housing and community development programs and activities because of race, color, religion, sex (including gender, gender identity, sexual orientation, and sexual harassment), national origin, familial status, and disability. These obligations extend to recipients of HUD financial assistance, including sub-recipients, as well as the operations of state and local governments and their agencies, and certain private organizations operating housing and community development services, programs, or activities.

HSNH 2022 – 2024 6 Back to topEqual Access and Prohibited Inquiries All activities must be made available without regard to actual or perceived sexual orientation, gender identity, or marital status. Grantees are prohibited from inquiring about an applicant’s or participant’s sexual orientation or gender identity for the purpose of determining eligibility or otherwise making housing available. This does not prohibit an individual from voluntarily self-identifying sexual orientation or gender identity.

Service providers that make decisions about eligibility for or placement into single-sex emergency shelters or other facilities will place a potential project participant (or current project participant seeking a new assignment) in a shelter or facility that corresponds to the gender with which the person identifies, taking health and safety concerns into consideration. A project participant’s or potential project participant’s own views with respect to personal health and safety should be given serious consideration in making the placement. For instance, if the potential project participant requests to be placed based on his or her sex assigned at birth, the provider should place the individual in accordance with that request, consistent with health, safety, and privacy concerns. Providers must not make an assignment or reassignment based on complaints of another person when the sole stated basis of the complaint is a project participant or potential project participant’s non-conformance with gender stereotypes.

While an emergency shelter or housing project may limit assistance to households with children, it may not limit assistance to only women with children. Such a shelter or housing project must also serve the following family types, should they present, in order to be in compliance with the Equal Access rule: Single male head of household with minor child(ren); and any household made up of two or more adults, regardless of sexual orientation, marital status, or gender identity, presenting with minor child(ren).

Further, grantees must not discriminate against a group of people presenting as a family based on the composition of the family (e.g., adults and children or just adults), the age of any member’s family, the disability status of any members of the family, marital status, actual or perceived sexual orientation, or gender identity.

Under the Equal Access Rule, “family” includes, but is not limited to, regardless of marital status, actual or perceived sexual orientation, or gender identity, any group of persons presenting for assistance together with or without children and irrespective of age, relationship, or whether or not a member of the household has a disability. A child who is temporarily away from the home because of placement in foster care is considered a member of the family.

Grantees must assess and serve individuals and households as they present. Any group of people that present together for assistance and identify themselves as a family, regardless of age, relationship, or other factors, are considered to be a family and must be served as such.

Discharge Coordination Persons who are being imminently discharged into homelessness from publicly funded institutions are eligible to receive financial assistance or services through this funding as long as they meet the project participant eligibility requirements. Grantees and CoCs/LPGs must coordinate with these institutions to prevent, where possible, individuals from becoming homeless. Referrals must be made where appropriate to the following:

• Veterans Administration (VA)
• Department of Social Services
• Community Services Boards (CSBs)
• Other mainstream resources as needed

HSNH 2022 – 2024 7 Back to topCompliance with Fair Housing and Civil Rights Laws (1) Grantees must comply with all applicable state and federal fair housing and civil rights requirements (see 24 CFR 5.105(a)). This includes the Virginia Values Act (effective July 1, 2020) which expands the list of protected classes under the Virginia Fair Housing Act. As expanded, the Virginia Fair Housing Act prohibits discrimination based on race, color, national origin, sex, pregnancy, childbirth or other related conditions (including lactation), age (over 40), marital status, disability, sexual orientation, gender identity, or veteran status (collectively the “Protected Classes”). (2) If the grantee: (a) Has been charged with an ongoing systemic violation of the Fair Housing Act; or (b) Is a defendant in a Fair Housing Act lawsuit filed by the Department of Justice alleging an ongoing pattern or practice of discrimination; or (c) Has received a letter of findings identifying ongoing systemic noncompliance under Title VI of the Civil Rights Act of 1964, section 504 of the Rehabilitation Act of 1973, or section 109 of the Housing and Community Development Act of 1974, and the charge, lawsuit, or letter of findings referenced in subparagraphs (a), (b), or (c) above has not been resolved before the application deadline, then the grantee is ineligible to apply for funds.

Compliance with Virginia Residential Landlord and Tenant Act All HSNH-funded project activities must adhere to the Virginia Residential Landlord and Tenant Act (VRLTA) as applicable.

Americans with Disabilities Act Compliance All grantees shall adhere to Title II and III of the Americans with Disabilities Act (ADA). Title II prohibits discrimination in the form of excluding an otherwise qualified person with a disability (i.e. a person who would qualify for the program or activity but for their disability) from participating in programs or activities is prohibited. All are required to make reasonable accommodations in policies and practices and to make reasonable modifications in physical structures to ensure equal access to the programs. Title III prohibits discrimination on the basis of disability in the activities of places of public accommodations which include shelters, social service establishments, and other public accommodations providing housing and requires newly constructed or altered places of public accommodation—as well as commercial facilities (privately owned, nonresidential facilities such as factories, warehouses, or office buildings)—to comply with the ADA Standards.

Confidentiality Policy All grantees shall ensure the confidentiality of the name of any individual assisted and any other information regarding individuals receiving assistance.

The grantee’s confidentiality policy should, at a minimum, address:

• How staff will gather, record, and store confidential information;
• The consent process for the release of confidential information;
• Protocols for responding to breaches of confidentiality;
• Standards contained in relevant state and federal laws, including HIPAA compliance (if applicable) and HIV confidentiality statutes; and,
• Privacy standards related to data collection and use of participant information for program reporting, such as HMIS.

Grievance and Termination Policy Any individual receiving assistance must receive written notification of the grantee’s grievance policy. Grievance policies must be board-approved and provide specific procedures to be followed for any disputed decision affecting this assistance. Project participants contacting DHCD directly will be referred back to the grantee’s grievance policy. The grantee must be prepared to provide documentation of the grievance record for all project participant grievances.

DHCD will review and approve all grievance policies.

HSNH 2022 – 2024 8 Back to topGrantees may terminate assistance to a project participant who violates program requirements and resume assistance to a project participant whose assistance was previously terminated.

Termination must include a formal process that recognizes the rights of individuals receiving assistance to the due process of law. This process must include at least two-levels. The initial level of the process should be held by the grantee organization wherein the grievance is reviewed or heard by an individual other than the person (or subordinate of that person) who made or approved the termination decision. Should the client or household disagree with the decision made by the initial reviewer, a second level must be available for an appeal at the CoC/LPG level. This two-level process, at a minimum, must consist of: (1) Written notice to the project participant containing a clear statement of the reasons for termination; (2) Prompt written notice of the final decision to the project participant; and (3) Written policy for continuing assistance to surviving family members, in the event of a death of a head of household, that establishes a reasonable grace period of continued assistance to surviving family members, not to exceed one year, measured from the date of death of the participant.

Recordkeeping Grantees must keep any records and make any reports (including those pertaining to services received, project participant housing status, race, ethnicity, gender, and disability status data) that DHCD requires within the specified timeframe. All contractual and project participant records must be maintained for at a minimum of five years. Records include both program records such as the documentation or match requirement, financial records such as bank statements, and project participant records. Copies of cancelled checks/bank statements or expenses associated with the project participant must also be retained. Grantees are required to maintain a record of all project participants that are screened and classified as ineligible for a service provided within the continuum of care. This must include documentation of the reason for the determination of ineligibility. For more information about documentation requirements see Accounting Standards.

Data Reporting Requirements Reports must be submitted in CAMS as required by DHCD. Reports will also be required at the CoC and LPG level. Timeliness is critical, as this data will be aggregated for other reporting purposes. Grantees that fail to meet reporting requirements and deadlines are considered non-compliant which may affect future grant reimbursements and other DHCD funding opportunities.

Grantees must ensure that data is complete and accurate. Each grantee is expected to enter all project participant data into the HMIS system, complete periodic data quality checks, and work with the local HMIS administrator to ensure that complete quality data is submitted to DHCD by the specific due dates. Grantees primarily serving survivors of domestic violence and sexual assault must meet these requirements using a comparable database.

Grantees must be able to track and report program activities, project participant data, and spending separately from other activities. Grantees will report on outputs, such as the number of persons served and the demographic characteristics of persons served, program funds expended by activity type, as well as outcomes related to housing stability. Most reporting elements will be generated from HMIS data. Adherence to required HMIS data standards will be essential to performance reporting.

HMIS HMIS is an electronic data collection system that facilitates the collection of information on persons who are homeless or at risk of becoming homeless that is managed and operated locally. Grantees must certify that there is full utilization with the HMIS in their area. However, different areas within the state may use different systems and/or system administrators. The

HSNH 2022 – 2024 9 Back to topgrantee or any prospective grantee should work with their CoC/LPG to coordinate HMIS access and technical assistance. The grantee assumes full responsibility for all reporting to DHCD.

Grantees are required to report project participant-level data, such as the number of persons served and their demographic information, in a HMIS database. Grantees providing financial assistance and services will use the HMIS system in the applicable continuum of care to collect data and report on outputs and outcomes as required. The required data elements that will be collected in HMIS are included in the 2022 HMIS Data Standards.

HMIS systems may be open or closed. Closed systems prevent other providers within a local HMIS system from sharing project participant data. Open systems allow for coordination among service providers and facilitate a coordinated or centralized assessment process. While an open system may not yet be available in a specific CoC/LPG, grantees must participate in an open system as one becomes available for local use.

Domestic violence service providers and HOPWA providers not using HMIS must use a comparable system that meets all HMIS data standards and reporting requirements.

Learn more about HMIS requirements.

DUNS Number All grantees are required to register with Dun and Bradstreet to obtain a DUNS number, if they have not already done so, and complete or renew their registration in the Central Contractor Registration (CCR).

System for Award Management (SAM) The System for Award Management (SAM) combines federal procurement systems and the Catalog of Federal Domestic Assistance into one system to include the CCR. As with CCR, SAM collects, validates, stores, and disseminates data. Since 2003, indirect recipients of federal funds have been required to register with CCR and as of 2012, CCR merged with SAM. All grantees and sub grantees or subcontractors receiving federal grant awards or contract must be registered with SAM. For further information on registering and renewing annual registrations, go to https://www.sam.gov.

Method of Payment All grantees must be registered in CAMS and have approved audits in order to receive reimbursement. Remittances are submitted in CAMS; however, any grantee with unresolved findings or compliance issues may have reimbursement suspended.

DHCD requires that grantees receive funds via electronic transfer. Instructions on establishing an account with the Virginia Department of Accounts (DOA) is located on their website through the selection of Electronic Data Interchange (EDI) from the link on the right hand side of the DOA main webpage. The EDI guide can then be accessed through a link under the Trading Partner Information section.

Financial Management Grantees must ensure compliance with regulations and requirements pertaining to the following key areas of financial management:

• Allowable costs
• Source documentation
• Internal controls
• Budget controls
• Cash management

HSNH 2022 – 2024 10 Back to top • Cost allocation plans

• Accounting records
• Procurement
• Property asset controls
• Audits

Grantees must only use funds for eligible activities and in accordance with the DHCD-approved program budget. Any changes from the planned expenditures must be approved in advance by DHCD. Funds may not be used for activities other than those authorized in the guidelines and approved by DHCD. Reimbursements are based on the date the payment is made by the grantee. All expenditures must be in accordance with program conditions such as funding ceilings and other limitations on eligible costs.

Internal controls refer to the combination of policies, procedures, defined responsibilities, personnel, and records that allow an organization to maintain adequate oversight and control of its finances. Internal controls reflect the overall financial management system of an organization or agency. Budget controls, cash management, cost allocation plans, accounting records, procurement, and property controls are subsets of the overall financial system.

The specific administrative requirements (i.e., financial management standards) for grants to state and local government entities are contained in 24 CFR Part 200 and CAPP Manual.

Grantees will be monitored for compliance with the program requirements and documentation.

A financial compliance monitoring may include the following:

• An organizational chart showing titles and lines of authority for all individuals involved in approving or recording financial (and other) transactions
• Written position descriptions that describe the responsibilities of all key employees
• A written policy manual specifying approval authority for financial transactions and guidelines for controlling expenditures
• Written procedures for the recording of transactions, as well as an accounting manual and a chart of accounts
• Adequate separation of duties to ensure that no one individual has authority over an entire financial transaction
• Hiring policies to ensure that staff qualifications are equal to job responsibilities and that individuals hired are competent to do the job
• Access to accounting records, assets, blank forms, and confidential records is adequately controlled, such that only authorized persons can access them
• Procedures for regular reconciliation of its financial records, comparing its records with actual assets and liabilities of the organization
• Accounting records/source documentation
• Cash management procedures
• Cost allocation plans
• Procurement procedures
• Property controls
• Annual Audit

In order to ensure DHCD monitoring processes are compliance with Violence Against Women Act (VAWA), domestic violence service providers must adopt a formal check request policy to ensure appropriate use of grant funds. The grantee must use a Check Request form as the primary method of requesting checks or cash in connection with an authorized expense incurred on behalf of grant-funded programs or project participant expenses. Check requests describe the expense, list the amount of the expense, and should follow the following steps:

HSNH 2022 – 2024 11 Back to top 1. Use a standardized Check Request form to include a description of the expense, the title of the corresponding eligible grant activity, the amount of the expense, and the payee.

1. Get requisite approval from supervisor.
2. Attach receipts and/or invoices. Make sure the amount requested matches the amount to be spent or reimbursed.
3. Submit to appropriate finance personnel who will verify information provided, review back-up documentation, file documentation, and prepare check(s). Once filed, the Check Request forms and attached receipts and/or invoices must have any project participant-level personally identifying information redacted.

All check requests must have at least two signatures: the requestor and the authorizer. The authorizing signature must be a director or manager that has budgetary oversight for the program incurring the expense. All significant (over $5,000), unusual, and nonrecurring transactions must be reported to the CEO.

Time Sheets Employee time sheets must reflect actual hours (not percentages) worked based on the cost allocation plan. Time sheets must be signed and dated by the employee and the supervisor with first-hand knowledge of the work performed or equivalent electronic approval. If the expenditures are paid for by more than one source (e.g., federal, public, private) the split costs should be accurately tracked within the grantee's accounting system.

Hazard Pay Grantees with staff who are working in frontline or essential services positions may elect to adopt a Hazard Pay policy. This policy must be formally adopted and written into the organization’s employee policies manual. During an emergency crisis, the adoption of a Hazard Pay policy would allow grantees to increase pay for frontline or essential services staff for continuing their work during the crisis. If the grantee chooses to adopt a hazard pay policy, it should be reflected on employee time sheets to support the increase in payments.

Accounting Standards In addition to establishing a system of accounting sufficient to accurately record and report transactions, adequate source documentation must be maintained as support for these transactions. Source documentation includes but is not limited to the following:

• Purchase Requisitions
• Purchase Orders
• Contracts
• Contract Invoices
• Bank Statements
• Cancelled Checks
• Draw downs
• Payment Vouchers
• Employee Time Sheets
• Travel Advance Requests
• Travel Reimbursement Vouchers
• Vendor Invoices
• Journal Voucher Entries
• Cash Receipts

All source documents must be coded by a reference number so that a clear link exists between the fiscal records and these documents. Coding could include the check number used to make the payment, the journal entry in which transaction was recorded or the page number from the

HSNH 2022 – 2024 12 Back to topcash receipt journal. Purchase order numbers and payment voucher numbers may also be used to provide the necessary audit link.

Supporting documents can be copies or originals, but must be sufficient in detail to support the transaction and to justify it as an allowable grant expense.

The grantee must keep copies of the source documents, and be made available for HUD and/or DHCD review upon request for a minimum of five (5) years.

The grantee must maintain proof of cancellation (e.g. copy of check’s backside, bank statement, or photocopy of check’s cancellation) for all payments. While these are not required in the project participant files, they must be readily available for monitoring purposes.

Internal Controls The grantee must have appropriate internal controls in place to:

• Safeguard assets;
• Prevent waste, fraud, and mismanagement;
• Promote efficiency of operations; and
• Whistleblower protections.

Effective internal controls to the extent possible must include the following procedures:

• Segregation of duties among employees to prevent one person from having complete control over all phases of any transaction
• Workflow procedures for processing all transactions from one employee to another. This must provide for a cross check of work, but not a duplication of effort
• Rotation of duties among employees to allow for control over any one given phase and ensure that other employees can fill in when a position becomes vacant
• The procedures used should be clearly detailed and documented for all individuals to follow and as an aid in training new employees
• All assets, records, and checks must be properly protected using locks, safes, and other measures to ensure security

Monitoring DHCD is responsible for monitoring all program activities carried out by a grantee to ensure that the program requirements are met. Monitoring can include both programmatic and financial reviews. DHCD and HUD may monitor any funded project, as applicable. Grantees must make available organizational and project related records to both DHCD and HUD with notice.

Grantees are responsible for all programmatic and contractual terms. The grantee is responsible for ensuring that these terms and requirements are met regardless of partnership arrangements or MOUs with other organizations.

Results from the monitoring of grantees will be shared with the grantee’s board of directors and CoC/LPG lead agency.

Conflicts of Interest Grantees and partners must have conflict of interest policies that clearly prohibit personal gain or benefit and meet other program requirements.

Organizational Conflicts of Interest The provision of any type or amount of assistance may not be conditional on a household’s acceptance or occupancy of housing owned by the grantee, sub-grantee, parent organization, or subsidiary. An organization may not both participate in decision-making related to

HSNH 2022 – 2024 13 Back to topdetermining eligibility and receive any financial benefit. For example, a grantee, sub-grantee, parent organization, or subsidiary may not both administer rapid re-housing or prevention assistance and use the assistance for households residing in units owned by the entity.

A CoC/LPG may request a waiver for an organization to both administer rapid re-housing assistance and place households in units owned by the same organization, a parent organization, or subsidiary where critical local necessity can be demonstrated and where project participant evaluations will be provided by another unrelated organization. Waiver requests must be submitted in writing to DHCD prior to the provision of rapid re-housing assistance specific to the requested waiver. Waivers will not be granted for prevention administrators.

Individual Conflicts of Interest Individual conflicts of interest apply to any person who is an employee, agent, consultant, officer, or elected or appointed official of the grantee or its sub-grantee. For the procurement of goods and services, the grantee and/or its sub-grantee must comply with the agency code of conduct and conflict of interest policies.

Individuals (employees, agents, consultants, officers, or elected or appointed officials of the grantee or sub-grantee) may not both participate in decision-making related to determining eligibility and receive any financial benefit. This financial benefit may not be received by the specific individual, any member of his/her immediate family or a business interest. The restriction applies throughout tenure in the position and for a one-year period following tenure.

Upon written request of the grantee, DHCD may grant an exception to the restrictions in the paragraph above on a case-by-case basis when it determines that the exception will serve to further the goals of the program and promote the efficient use of program funds. In requesting an exception, the grantee must provide a disclosure of the nature of the conflict, accompanied by an assurance that there has been public disclosure of the conflict and a description of how the public disclosure was made. In most cases, additional HUD waivers are required.

Property Standards DHCD provides the Basic Habitability Checklist that must be completed, signed by all required parties, and included in all project participant records for rapid re-housing and prevention (new units only) assistance. The checklist must also be completed for each emergency shelter location and retained in agency administrative records. While the habitability standards do not require a certified inspector, the inspector must meet one of the following criteria:

• Program staff (grantee/sub-grantee staff); or
• Staff from or hired by an agency of the grantee/sub-grantee, such as a city department that is designated to conduct inspections, or a contractor hired for that task; or
• Staff from another subsidy program that is providing assistance and requires an inspection (e.g., Section 8, Public Housing).

The habitability standards are different from HUD’s Housing Quality Standards (HQS).

Housing that is occupied by families with children and that was constructed before 1978 must also comply with Lead Based Paint inspection requirements, per the Lead Based Paint Poisoning Prevention Act. This requirement applies only to units that a family moves into with assistance. This does not apply to units currently occupied by project participants.

HOPWA HQS differs from the standards of the Basic Habitability Checklist. See HOPWA HQS.

DHCD provides a Lead-Based Paint Visual Assessment form that must be completed and included in project participant records. Staff must complete an online training course before performing visual assessments.

HSNH 2022 – 2024 14 Back to topThe Lead-Based Paint Poisoning Prevention Act (42 U.S.C. 4801 et seq.), as amended by the Residential Lead-Based Paint Hazard Reduction Act of 1992 (42 U.S.C. 4851 et seq.) and implementing regulations at 24 CFR part 35, subparts A, B, M, and R shall apply to housing occupied by families receiving assistance through HOPWA.

HUD’s lead-based paint rules apply to all housing units that a family with children moves into with assistance. Specifically, lead-based paint rules apply when:

1. Housing to be assisted was constructed before 1978; and
2. Residents will include a pregnant woman or a child 6 years of age or younger. Note: Studio units are exempt.

All housing meeting the above criteria must receive a lead-based paint visual assessment before assistance may be provided. Staff must complete an online training course before performing visual assessments and retain the certification on file.

Nondiscrimination and Equal Opportunity Requirements Grantees must comply with all applicable fair housing and civil rights requirements. In addition, grantees must make known that rental assistance and services are available to all on a nondiscriminatory basis and ensure that all citizens have equal access to information about and equal access to the financial assistance and services provided under this program. A statement of such must be included in the Project Participant Agreement, signed by the project participant, and maintained in the project participant file.

Among other things, this means that each grantee must take reasonable steps to ensure meaningful access to programs to persons with limited English proficiency (LEP), pursuant to Title VI of the Civil Rights Act of 1964.This may include providing language assistance or ensuring that program information is available in the appropriate languages for the geographic area served by the CoC/LPG and that LEP persons have meaningful access to this assistance.

Affirmatively Furthering Fair Housing Grantees have a duty to affirmatively further fair housing opportunities for classes protected under the Fair Housing Act. Protected classes include race, color, national origin, religion, sex, disability, and familial status. In addition, Virginia’s Fair Housing Law further protects “elderliness,” individuals age 55 or older, from housing discrimination and the Virginia Values Act extends existing state non-discrimination protections for housing on the basis of sexual orientation and gender identity. Examples of affirmatively furthering fair housing include: (1) marketing the program to all eligible persons, including persons with disabilities and persons with limited English proficiency; (2) making buildings and communications that facilitate applications and service delivery accessible to persons with disabilities (see, for example, HUD’s rule on effective communications at 24 CFR 8.6); (3) providing fair housing counseling services or referrals to fair housing agencies; (4) informing participants of how to file a housing discrimination complaint, including providing the toll-free number for the Housing Discrimination Hotline: 1-800-669-9777; and (5) recruiting landlords and service providers in areas to which housing choice is expanded. In addition, housing discrimination complaints may be reported to the Virginia Fair Housing Office at the Department of Professional and Occupational Regulation at (888) 551-3247.

HSNH Ineligible and Prohibited Activities Ineligible and prohibited activities include but are not limited to the following:  Grantee past due taxes  Grantee late fees  Repayment of loans from the project participant to the grantee  Return of utility or security deposits to the grantee not tracked as program income

HSNH 2022 – 2024 15 Back to top  Construction or rehabilitation  Project participant credit card bills or other debt  Vehicle repair  Medical or dental care and medicines (not applicable to HOPWA)  Expenses related to drug and alcohol testing  Clothing and grooming  Home furnishings  Pet care  Renter’s insurance  Payment of third-party security deposits such as surety bonds  Entertainment activities  Project participant work or education related materials  Cash assistance to project participants, including gift cards and gas cards  Expenses to develop discharge planning programs from institutional settings  Any payments made to project participants  Any payments to ineligible third parties  Any fees charged to the project applicant or participant  Employee bonuses

Emergency Crisis Response System How A Crisis Response System Can End Homelessness An effective crisis response system is able to identify and quickly connect people who are experiencing or are at risk of experiencing homelessness to housing assistance and other services. It works because it aligns a community, its programs, and services around one common goal – to make homelessness rare, brief, and nonrecurring.

What Is a Crisis Response System?

The goals of an effective crisis response system are to identify those experiencing homelessness, prevent homelessness when possible, connect people with housing quickly, and provide services when needed. An effective crisis response system achieves those goals through the following:

Outreach: Outreach workers connect people at risk of or experiencing homelessness to coordinated entry, emergency services, and shelter. They work with other programs in the system to connect people to stable, permanent housing.

Coordinated entry: Coordinated entry is a process designed to quickly identify, assess, refer, and connect people in crisis to housing assistance and services.

Prevention: Prevention is an important component of a community’s crisis response system and can help it reduce the size of its homeless population. Prevention assistance can aid households in preserving their current housing situation or prevent homelessness for people who are currently housed, but seeking shelter. This assistance helps them identify immediate alternate housing arrangements and, if necessary, connect them with services.

Emergency shelters and interim housing: People experiencing a housing crisis or fleeing an unsafe situation need to find a place to stay, quickly. Emergency shelter and interim housing can fill this role in a crisis response system. These interventions should be low-barrier and align their goals and program activities with the larger system’s goals.

HSNH 2022 – 2024 16 Back to topPermanent housing: A crisis response system must have the capacity to connect people experiencing homelessness with permanent housing programs, such as rapid re-housing and permanent supportive housing, and other stable housing options.

Role of the CoC/LPG The role of the CoC/LPG is to promote a communitywide goal of ending homelessness, provide funding for efforts to rehouse those who are homeless, promote access to mainstream programs, and optimize housing stabilization.

Each CoC/LPG must have a lead entity accountable for these goals and the responsibility to ensure effective communication to all stakeholders involved in the CoC/LPG’s emergency crisis response system.

Responsibilities The responsibilities of the CoC/LPG include governance and structure, system coordination and planning, designating and operating the HMIS, and designing a coordinated entry system.

Governance and structure Each CoC/LPG is to have a board that represents the CoC/LPG and includes at least one homeless or formally homeless person. The responsibilities of the board depend on the authority delegated to the board by the CoC/LPG and must be documented in the CoC/LPG’s governance charter. Other committees should be identified in the charter to carry out the responsibilities of the CoC/LPG.

System coordination and planning At a minimum, the system should include coordinated outreach and engagement, entry and assessment, shelter, permanent housing, supportive services, and homeless prevention strategies. Written system standards must be established to guide the implementation of all homeless assistance services.

Planning efforts must ensure a coordinated and “right sized” system by conducting a point-in-time count, annual gaps analysis, participation in consolidated plan development, and consultation with Emergency Solutions Grant (ESG) recipients. In addition, the CoC/LPG must establish and monitor performance measures and take action against poor performers.

Designating and operating HMIS Each CoC/LPG must designate a HMIS lead to carry out the day-to-day operations of the CoC

HMIS.

Coordinated entry CoC/LPG must operate a coordinated entry system that provides an initial, comprehensive assessment of households who are homeless and best connect them to the housing and services they need to return to, and stabilize in, permanent housing.

HSNH 2022 – 2024 17 Back to topVirginia Homeless Solutions Program Virginia Homeless Solutions Program (VHSP) funds support the emergency crisis response system, a housing-focused approach to ensure homelessness is rare, brief, and one-time through coordinated community-based activities. The goals of VHSP are to assist households experiencing homelessness to quickly regain stability in permanent housing and to prevent households from becoming homeless. These activities are designed to reduce the overall length of homelessness in the community, the number of households becoming homeless, and the overall rate of formerly homeless households returning to homelessness.

Key Outputs and Performance Measures Grantees and CoC/LPGs will be evaluated and monitored on how well they achieve key outputs, performance measures, and processes.

Agencies will be required to report on the following outputs:  Demographics  Permanent housing placements  Length of time receiving financial assistance (Targeted Prevention and RRH)  Length of time receiving case management (Targeted Prevention and RRH)  Capacity and utilization (Emergency Shelter Operations)  Prior living situation (all project types)  Insurance (all project types)

During agency and system monitoring, evaluations of the following processes will occur:  Ensuring that all households at the entry point are assessed with a standardized assessment tool  Entry point(s) are low-barrier and easily accessible  Service providers refer appropriate households seeking shelter to the entry points  Appropriate written policies and procedures are implemented (DHCD must review and approve these and all revisions)  Individualized housing-focused case management is provided

VHSP Funding DHCD administers the Commonwealth of Virginia’s homeless services resources through VHSP. These resources include approximately $15 million in state and federal annual funding.

Funding Sources (approximate annual amounts) Name Source Amount Emergency Solutions Grant Federal – HUD $2,430,583 $8,656,397 ($1,078,000 set aside State General Funds – Homeless Virginia for RRH, $100,000 of which is Assistance veteran-specific) State General Funds – Homeless Virginia $3,988,412 Prevention TOTAL $15,075,392 * Actual funding levels have not been determined at the writing of this document and could vary significantly from estimated amounts.

DHCD will support CoC/LPG strategies and homeless service programs that align with state and federal goals to ensure there is an effective emergency crisis response system to homelessness in communities throughout the commonwealth.

HSNH – VHSP 2022 – 2024 18 Back to topVHSP funding will be administered based on a two-year funding cycle. DHCD will issue one-year (July 1, 2022 - June 30, 2023) grants to grantees as a result of an application process.

These grants will be renewable based on performance, compliance, and available funds for a second year of funding (July 1, 2023 – June 30, 2024).

Grant Award Funding VHSP funds will be allocated through the community-based competitive application process.

The amount of funding received within any CoC/LPG is based on available funds and the application score that reflects the following:  Local need;  Alignment of the approach with state and federal goals;  Alignment of proposed activities with state goals;  Local coordination;  Community and provider capacity;  Data quality; and  Performance outcomes.

While applications are community-based, grants are provided to specific organizations for eligible projects. There is a minimum contract request amount of $25,000 per grantee; however, DHCD reserves the right to enter into contracts with grantees for less than $25,000.

Match Requirement VHSP funds require a 25 percent match based on the total amount of funds allocated to the CoC/LPG. This match requirement may be met at the community and/or grantee level. This allows communities to use programs or services funded by local and private resources as a match for this funding. The match must be used to meet the VHSP goals: to reduce the number of persons who become homeless, to shorten the length of time persons are homeless, and to reduce the number of persons that return to homelessness. Match must be received and expended within the grant year and may not be used to meet multiple match requirements.

Allowable sources of match are cash, the fair rental value of any donated material or space and any salary paid from local or private sources which have not otherwise been charged to VHSP.

Match resources also may include in-kind donations and volunteer labor. The worth of in-kind donations and labor are based on the value at the time of the donation or service rendered.

To determine the volunteer hourly rate, consult Independent Sector’s website https://independentsector.org/value-of-volunteer-time-2021/. The value of the volunteer rate presented is the average wage of non-management, non-agricultural workers. If a volunteer is providing a specialized skill, the Bureau of Labor Statistics has hourly wages by occupation that may be used to determine the value of a specialized skill.

Grantee Requirements Grantees are funded as a result of a community based application process which identifies specific organizations that will carry out homeless service activities. DHCD contracts directly with these individual organizations or grantees. Grantees must be non-profits that are current on 990 filings, housing authorities, planning district commissions or units of local government.

Planning district commissions and housing authorities are not eligible to receive funding for shelter operations or rapid re-housing activities. However, units of local government may sub-grant rapid re-housing funding to housing authorities. See Notice CPD-17-10 Sub-awarding Emergency Solutions Grants Program Funds to Public Housing Agencies and Local Redevelopment Authorities.

HSNH – VHSP 2022 – 2024 19 Back to topIn addition to requirements set forth in the Homeless and Special Needs Housing guidelines, each grantee must adhere to the following requirements including:  Full participation in coordinated/centralized assessment system  100 percent of project participants assessed with community-based common assessment tool  Coordination with other homeless services and homeless prevention providers  Use of HMIS that meets HUD HMIS data standards (DV programs may use another data system, but must meet all HUD HMIS data standards and reporting requirements)  Timely referral of eligible households for targeted prevention or rapid re-housing assistance through coordinated assessment/entry or coordination with providers  Documentation of project participant homeless status and services provided  Completion of a housing barrier assessment and housing plan that includes how permanent housing will be maintained once assistance is terminated  Adherence to a primary focus on quick placement into permanent housing  Adherence to a secondary focus on housing stability

Housing First All programs must use a housing first approach focused on moving project participants into permanent housing as quickly as possible. Grantees must use housing stabilization support services and mainstream resources as needed to ensure housing stability. Grantees’ program policies and procedures must reflect a Housing First approach.

Harm Reduction All programs must emphasize a Harm Reduction approach. In accordance with Harm Reduction principles, programs must not require treatment or sobriety. Grantees must seek to work with project participants to reduce the negative consequences of the person’s continued use of alcohol and/or drugs. Termination of assistance must not be based upon a person’s continued use of alcohol and/or drugs or adherence to medical regimen. Efforts should include all possible approaches to assist the person to reduce or minimize the risk of these behaviors, while at the same time assisting them to move into, and stabilize in, permanent housing. Harm reduction is not intended to prevent the termination of a participant whose actions constitute a threat to the safety of other participants and staff. Grantees’ program policies and procedures must reflect a Harm Reduction approach.

Trauma Informed Care All programs must incorporate Trauma Informed Care policies and procedures into their program design and delivery of services. Trauma Informed Care is defined as: an organizational structure and treatment framework that involves understanding, recognizing, and responding to the effects of all types of trauma. Trauma Informed Care also emphasizes physical, psychological, and emotional safety for both project participants and providers, with the goal of rebuilding a sense of control and empowerment. Trauma Informed services take into account an understanding of trauma in all aspects of service delivery and place priority on the trauma survivor’s safety and agency. Trauma Informed Services create a culture of nonviolence, learning, and collaboration. Grantees’ program policies and procedures must reflect a Trauma Informed Care approach.

Case Management Best Practices All programs must ensure staff providing case management and supportive services have the necessary skills and training to effectively serve project participants. All VHSP-funded case management and supportive services staff positions must have these skills and trainings listed within the job position description. These skills and training should include: Housing-Focused Case Management, Motivational Interviewing, Trauma-Informed Care, and Harm Reduction.

HSNH – VHSP 2022 – 2024 20 Back to top  Housing-Focused Case Management is a case management approach focused on housing stability and placement with an emphasis on the arrangement, coordination, monitoring, and delivery of services related to housing needs and improving housing stability. While showing empathy and respect, an effective case manager tailors their approach, methods of engagement, and services offered to meet the unique needs of each project participant household.  Motivational Interviewing is a person-centered approach to working with project participants focused on evoking motivation for change and developing an actionable plan using self-identified goals.

Homeless Participation Grantees must provide for the participation of not less than one homeless individual or formerly homeless individual on the board of directors or other equivalent policy-making entity of the recipient, to the extent that the entity considers and makes policies and decisions regarding any facilities, services, or other assistance. If the grantee is unable to meet the requirement, it must instead develop and implement a plan to consult with homeless or formerly homeless individuals in considering and making policies and decisions regarding any facilities, services, or other assistance that receive funding. To the maximum extent practicable, the grantee must involve homeless individuals and families in constructing, renovating, maintaining, and operating facilities. This involvement may include employment or volunteer services.

Prohibition Against Involuntary Family Separation The family unit must be accepted and sheltered as they present. Further, the age of a child under age 18 must not be used as a basis for denying a family admission to an emergency shelter that uses VHSP funding or services and provides shelter to families with children under age 18. All VHSP-funded service providers that provide shelter to families must do so regardless of the age of the child.

Initial Screening All households seeking homeless assistance must be initially screened through coordinated or centralized assessment/entry. This screening must be completed in a manner that allows for the identification of households for prevention services and immediate referral to the appropriate provider. Initial screenings take place when the household is seeking assistance. All households seeking services, regardless of eligibility or ineligibility for any specific program, must receive appropriate referrals. Records must be maintained for all households denied services. See Recordkeeping requirements.

Proof of Diversion All households seeking homeless assistance must be engaged in diversion, a problem-solving conversation to address the household’s current housing crisis. Diversion is not meant to turn households away from accessing necessary services; rather, it is a strengths-based practice that helps households identify safe housing options and solutions based on their available resources, not those of the homeless crisis response system. This should include a discussion of alternative resources available to the household, linkages to mainstream and natural supports, and light-touch assistance such as short-term and one-time financial assistance.

Evidence of diversion must be documented at intake using case notes and/or a grantee’s or CoC/LPG’s established diversion tool.

Strength-Based Housing Barriers Assessment and Housing Plan Once the initial housing crisis is addressed, the project participant household must receive a housing barriers assessment. A housing plan must be developed based on the initial assessment for each project participant household. In all cases, housing barrier assessments

HSNH – VHSP 2022 – 2024 21 Back to topand plans must be individualized to identify and address the unique household situation. All plans must be focused first on quickly obtaining permanent housing and second on obtaining and maintaining housing stability. Project participants must receive at least monthly housing-focused case management.

Environmental Reviews Environmental reviews (ER) are required for rapid re-housing when rental assistance is provided. Based on guidance provided by HUD Headquarters, DHCD will complete one ER that will cover the majority of the VHSP RRH projects. A grantee will need to complete an ER only if the unit is part of a complex with more than five units and falls in the 100 Year Flood Plain or on a Coastal Barrier. To determine if the unit is located in either of these two locations use the following resources:

 John H. Chafee Coastal Barrier Resources System Virginia: http://www.fws.gov/ecological-services/habitat-conservation/cbra/maps/Locator/VA.pdf  Coastal Barrier Resources System Mapper: http://www.fws.gov/cbra/Maps/Mapper.html  FEMA’s National Flood Hazard Layer (mapping tool): https://www.fema.gov/national-flood-hazard-layer-nfhl

In addition, units in the following areas (regardless of flood plain status but not coastal barrier status) are not required to complete an additional ER: Accomack Hillsboro Painter Cheriton Keller Scottsburg Clintwood La Crosse South Hill Dendron Melfa The Plains Galax Montross Troutdale Gretna Newsoms

The environmental review is based on the building and surrounding geography, and not just the actual unit. Therefore, if a unit is located within a building or a complex the ER need only be conducted on the building or complex and not each unit. Environmental reviews are valid for five years, so if a unit, building, or complex has had a review within the last five years, an additional ER will not need to be conducted.

The environmental review form, Environmental Review for Activity/Project that is Exempt or Categorically Excluded Not Subject to Section 58.5 (Pursuant to 24 CFR 58.34(a) and 58.35(b)), must be completed for each unit/complex that falls in the flood plain or coastal barrier where rental assistance is provided. DHCD will provide a partially completed form to be used for VHSP rapid re-housing projects.

Eligible Service Areas The VHSP funds are allocated to grantees within CoCs/LPGs within Virginia. Eligible service area requirements are intended to maximize the amount of available funds serving Virginia localities and are not intended to exclude services to any individuals or family based upon their last known address.

Eligible Activities There are eight categories of eligible VHSP activities:  Outreach  Centralized or Coordinated Assessment/Entry System  Targeted Prevention  Emergency Shelter Operations  Rapid Re-housing HSNH – VHSP 2022 – 2024 22 Back to top  CoC/LPG Planning  HMIS  Administrative Costs

VHSP activities and associated costs are intentionally focused on the implementation of an emergency crisis response system. Whenever possible, households experiencing a housing crisis should be diverted from entering the homeless services system through problem-solving conversations, linkages to mainstream and natural supports, and light-touch financial assistance through flexible funding sources.

This assistance is to prevent households from homelessness when possible, provide emergency shelter as necessary, rapidly move project participants to permanent housing, and ensure housing stability. VHSP assistance is not intended to provide long-term support, nor will it be able to address all of the financial and supportive services needs of households. Rather, assistance should be focused on housing stabilization, linkages to community resources, and mainstream benefits, and helping project participants develop a plan for preventing future housing instability. CoCs/LPGs must ensure that there is a clear process for determining the type, level, and duration of assistance for each project participant.

Outreach Outreach includes essential services related to reaching out to unsheltered homeless individuals and families, connecting them with emergency shelter, housing, or critical services.

Communities should share information across outreach teams and sites and engage with other systems, including law enforcement, hospitals and emergency departments, corrections, libraries, and job centers. These efforts should proactively seek all unsheltered people within the CoC/LPG geographic area, including people living in encampments or tent cities, and not be limited to serving only persons seeking assistance. All outreach should be person-centered and emphasize building rapport and trust as a means of helping people obtain housing with appropriate services.

Project Participant Eligibility Unsheltered homeless includes individuals or families who lack a fixed, regular, and adequate nighttime residence, such as an individual or family with a primary nighttime residence that is a public or private place not meant for human habitation including but not limited to a car, park, abandoned building, bus or train station, airport, or camping ground.

Requirements Outreach must be connected with the community’s centralized or coordinated assessment/entry system.

Required Documentation:  Documentation of literal homeless status  Strength-based housing barrier assessment and housing plan  Evidence of connection with the community’s coordinated entry process  Coordination with mainstream resources

Expenses Eligible outreach costs include:  Engagement and housing-focused case management  Limited support services (requires DHCD pre-approval)  Service location costs

HSNH – VHSP 2022 – 2024 23 Back to top  Other (requires DHCD pre-approval)

Engagement and housing-focused case management includes the costs of activities to locate, identify, and build relationships with unsheltered households experiencing homelessness and the cost of assessing housing and service needs, arranging, coordinating, and monitoring the delivery of individualized services to meet the needs of the project participant. Engagement and housing-focused case management costs include staff expenses related to:  Connecting with centralized or coordinated assessment system;  Actively connecting and providing information and referrals to programs targeted to people experiencing homelessness and mainstream social services and housing programs;  Purchasing items necessary for the household experiencing unsheltered homelessness to access housing such as the cost to secure identification;  Conducting and documenting an initial assessment of needs and eligibility;  Providing crisis counseling;  Addressing urgent physical needs such as the costs to purchase tangible items related to meeting the health and safety needs of an unsheltered household such as meals, toiletries, or blankets;  Completing a strength-based housing barriers assessment and corresponding individualized housing and service plans;  Assisting a project participant in overcoming immediate barriers to obtaining housing;  Monitoring and evaluating project participant progress; and  Oversight and supervision of engagement and housing-focused case management staff.

Limited support services include the transportation costs of travel by outreach workers, social workers, medical professionals, or other service providers are eligible, provided that this travel takes place during the provision of services eligible under this section. The costs of transporting unsheltered persons to emergency shelter or other service facilities, or to connect households with other permanent housing solutions (such as reuniting with family or friends in another locality), may also be eligible. These costs include the use of public transportation and rideshare programs by the project participant.

Any limited support services provided must be based on project participant needs and address specific housing barriers and emergency health services and mental health service needs.

These funds should be used as a last resort for support services and may not be used if other resources are available. Documentation of the need for a specific support service and the lack of other available resources must be included in the project participant file in cases where these funds are used to pay for essential services.

All limited support services costs must be pre-approved by DHCD.

Funds may be used for service location costs, such as rent for office space, printer/copier costs, and utilities for an office.

Centralized or Coordinated Assessment/Entry System All CoCs/LPGs and DHCD homeless services grantees must use a local centralized or coordinated assessment/entry system. A local centralized or coordinated assessment/entry system is a best practice for a housing-focused approach targeted to helping households experiencing homelessness quickly regain stability in permanent housing.

All local centralized or coordinated assessment/entry system providers must engage households seeking homeless assistance in diversion.

HSNH – VHSP 2022 – 2024 24 Back to topThe following are standards of an effective coordinated entry system:  Provides and documents problem-solving conversations to address the immediate housing crisis;  Provides coordinated project participant intakes, assessments, and referral;  Covers the entire CoC/LPG geographic area;  Affirmatively markets housing and support services regardless of race, color, national origin, religion, sex, age, familial status, or disability who are least likely to apply in the absence of outreach and maintains records of marketing activities;  Provides easy access for individuals and families seeking housing or services;  Provides a comprehensive and standardized assessment tool;  Conducts regular evaluations to determine overall system effectiveness for process improvement measures;  Has written standards that are low barrier for determining program eligibility, prioritization, and level of assistance; and  Provides training protocols and at least one annual training opportunity to organizations that serve as access points or otherwise conduct assessments.

For additional information, visit: https://www.hudexchange.info/pro-grams/coc/toolkit/responsibilities-and-duties/#coordinated-entry

Requirements Each centralized or coordinated assessment system must have in place written standards for determining program eligibility, prioritization, and level of assistance. Each system must conduct regular evaluations to determine overall effectiveness for process improvement measures.

CoC/LPGs must provide a local method and point-of-contact appropriate for referrals from state agencies and providers outside of their CoC/LPG. This contact must directly link individuals or providers to the centralized or coordinated assessment system.

All projects receiving VHSP funds for Centralized or Coordinated Assessment/Entry System must have projects set up as such in HMIS.

Expenses Eligible costs include:  Service Location Costs  Maintenance  Travel  Supplies  Hardware/Software  Staff salaries  Other (requires DHCD pre-approval)

Service location costs such as rent for office space where access is provided to conduct assessments, printer/copier costs, and utilities for an office are eligible.

Maintenance costs may include staff costs accrued by the grantee in the performance of maintenance on a location where access is provided to centralized or coordinated assessments.

Any maintenance or other contract for services must adhere to grantee procurement policies.

While travel costs are eligible, these must be documented as necessary. These include travel costs for staff to provide initial assessments where access either electronic or otherwise is not

HSNH – VHSP 2022 – 2024 25 Back to topreadily available. Systems must be designed to provide coverage for the entire CoC/LPG. Every effort must be made to leverage technology and community-based resources.

Supplies are limited to those directly related to the provision of centralized or coordinated assessments. These include but are not limited to office supplies. Supplies do not include luxury items or items that go beyond what is necessary to provide for the centralized or coordinated assessment system.

Reasonable and appropriate costs of hardware or software required for the purposes of providing initial assessments through a centralized or coordinated system are eligible. Eligible costs include the purchase of software and/or user licenses, the leasing or purchasing of needed computer equipment, and cost for auxiliary aids and language services.

Staff costs to provide access to the centralized or coordinated assessment, conduct the initial assessments, make referrals, and implement diversion are eligible costs. These include salary, fringe, and associated costs..

VHSP Participant Initial Eligibility Project Participant Initial Eligibility by Activity Type Eligible Activity Project Participant Eligibility  At imminent risk of homelessness;  Household income below 30 percent of median family Prevention income; AND  No other resources  Literally homeless  At imminent risk of homelessness and diversion has been attempted Shelter  Individuals exiting institution (where they resided temporarily) with no resources or anywhere to go  Individuals fleeing domestic violence  Literally homeless (shelter residents, living in other situations not meant for human habitation); or  Individuals who were literally homeless prior to entering an Rapid Re-housing institution (where they resided temporarily – 90 days or fewer) and are exiting the institution with no resources or anywhere to go; AND  No other resources

Targeted Prevention The crisis response system must attempt to prevent episodes of homelessness for individuals and households seeking shelter who are currently housed but at imminent risk of homelessness. Whenever possible and safe, households experiencing a housing crisis should be diverted from entering the homeless services system through problem-solving conversations, linkages to mainstream and natural supports, and light-touch financial assistance through flexible funding sources.

Communities should ensure that prevention financial assistance is targeted to households most likely to enter shelter but for the financial assistance. Prevention financial assistance is not intended to operate as an eviction prevention program. Non-financial prevention assistance should be leveraged where possible to divert households from homelessness. Financial assistance (e.g., rent assistance) should be provided as a last resort to prevent homelessness.

HSNH – VHSP 2022 – 2024 26 Back to topDuplication of assistance is not eligible. Financial assistance cannot be made on behalf of eligible individuals or families for the same period of time and for the same cost types that are being provided through another federal, state, or local housing subsidy program.

The following are examples of situations where prevention from homelessness may be feasible:  Household living in someone else’s unit (doubled-up) where the right to occupy has been terminated  Household living in their own unit where housing loss within 14 days is imminent and homelessness could be averted  Household living in hotel/motel (paid for by household) and the household is unable to pay for additional nights

Project Participant Eligibility Prevention assistance is limited to those households who will imminently lose their primary nighttime residence within 14 days and meet all other requirements. The household must have an income below 30 percent of MFI and lack the sufficient resources and support networks necessary to retain housing without assistance.

Prevention financial assistance beyond three months requires recertification of eligibility. This recertification must then be completed every three months based on the household’s project entry date for the duration of financial assistance. Recertification requires grantee documentation of the following:  Project participant household income below 30 percent of MFI  The household lacks the financial resources and support networks needed to remain in existing housing without Prevention assistance  Housing stabilization services are being appropriately implemented

Recertification Requirement Any Financial Assistance Every three months Services/Case Management Only Every 12 months

Requirements Prevention providers must coordinate with other service providers to ensure project participants receive services in a timely manner.

Provision of any financial assistance should be “needs-based,” meaning that grantees should determine the amount of assistance based on the minimum amount needed to maintain housing stability in the near term. This will allow communities to use program resources efficiently to serve as many households as possible.

When households are moved into a new unit or stabilized into an existing unit and rent assistance is provided, the rent must meet two standards:  Rent Reasonableness – rent is equal to or less than other like units in the area  Fair Market Rent (FMR) – rent (including utilities) is at or below the HUD established FMR for the unit size in the unit location

Rent reasonableness means that the total rent charged for a unit must be reasonable in relation to the rents being charged during the same time period for comparable units in the private unassisted market and must not be in excess of rents being charged by the owner during the same time period for comparable non-luxury unassisted units. To make this determination, the

HSNH – VHSP 2022 – 2024 27 Back to topgrantee should consider (a) the location, quality, size, type, and age of the unit; and (b) any amenities, housing services, maintenance and utilities to be provided by the owner.

FMR limits include the cost of utilities. Grantees will need to utilize an established utility allowance in order to assess FMR limits for rents on units not including all utilities. The actual rent charged for a unit plus the allowance for any utilities that the project participant must pay themselves must not exceed the FMR for the area.

If the gross rent for the unit exceeds either the rent reasonableness standard or the FMR, grantees are prohibited from using VHSP funds for any portion of the rent, even if the household is willing and/or able to pay the difference.

Grantees must not make payments directly to project participants, but only to landlords or property management companies. In addition, an assisted property may not be owned by the grantee or their parent, subsidiary, or affiliated organization (see Conflict of Interest).

Monthly housing-focused case management is required but participation in all program services must be voluntary. Grantees must provide the appropriate level of case management in order to ensure housing stability.

Required documentation for all VHSP – Prevention Project Participant Client Files:  Initial screening  Proof of diversion at intake (see HSNH-VHSP Guidelines, page 22)  Coordination with mainstream resources  Certification form signed by the project participant stating that the project participant has received a copy of the grantee’s grievance policy  Completed VHSP Prevention Project Participant Eligibility Requirements with corresponding eligibility documentation  Strength-based housing barrier assessments and housing plans;  Grantees must use HUD Published Income Limits for determining income limits;  Prevention financial assistance requires that the project participant head of household have the valid lease with a landlord that is in compliance with tenant/landlord laws in their name. A copy of this lease must be included in the project participant record; and  Monthly housing-focused case management (e.g., updates on housing plan, noted progress toward housing stability, etc.).

In addition, the following documentation is required for all VHSP – Prevention Project Participants receiving rent assistance:  A completed copy of the HSNH Rent Reasonableness Worksheet with the applicable Fair Market Rents (FMR) for the area noted, and  A copy of the completed utility allowance worksheet must be included in the project participant file. Grantees must utilize the appropriate utility allowance for any utilities paid by the project participant separate from rent. The local housing authority’s or Virginia Housing's appropriate regional allowances may be used to calculate the rent standard.

Expenses Non-financial prevention assistance should be leveraged where possible. Financial assistance (e.g., rent assistance) should be provided as a last resort to prevent homelessness.

Eligible targeted prevention costs include:  Rent assistance  Rent arrears

HSNH – VHSP 2022 – 2024 28 Back to top  Housing stabilization financial assistance  Housing stabilization case management  Housing search and placement  Housing stabilization services  Service location costs

Rent Assistance and Rent Arrears Rental assistance is tenant-based rental assistance that allows individuals and families to obtain and remain in rental units. These funds cannot be used for mortgage assistance.

Grantees must determine the amount of rental assistance provided, such as “shallow subsidies” (payment of a portion of the rent), payment of 100 percent of the rent, or graduated/declining subsidies. Grantees may require a project participant to share in the costs of rent.

No project participant may receive more than 24 months of assistance during any three-year period of time. Assistance with any portion of rent during a month counts as a month toward the 24-month limit.

Payment of rent arrears consists of a one-time payment for up to six months in arrears, including any late fees on those arrears. Rental arrears may be paid if the payment enables the project participant to obtain or retain a housing unit. Rental arrearage assistance should only be used to prevent homelessness.

If funds are used to pay rental arrears, arrears must be included in determining the total period of the project participant’s rental assistance, which may not exceed 24 months. While the payment of rent arrears is a lump sum and recorded as such in HMIS, each month and the number of months must be noted in HMIS and counted toward the total rent assistance limit of 24 months.

Any individual or family receiving assistance beyond any arrears and two current months of rent and financial assistance must be evaluated and recertified as eligible every three months.

Funds may not be used to pay damage costs incurred by the tenant.

Rental assistance or arrears to pay for a lot on which a manufactured or mobile home is located is an eligible expense as long as the household is otherwise eligible.

Housing Stabilization Financial Assistance Funds may be used to provide financial assistance to help project participants quickly access housing. The housing relocation and stabilization services financial assistance includes:  Security deposit and last month’s rent (if applicable)  Utility payments, including utility deposits and arrears  Moving costs  Application fees  Project participant travel costs

Security deposits must be paid directly to landlords or property managers.

Grantees must not take measures to recapture any deposit assistance provided to project participants. In the cases where the return of a deposit to the grantee is unavoidable, all returned deposits must be tracked as program income. Any resulting program income must be used for eligible activities.

HSNH – VHSP 2022 – 2024 29 Back to topFunds may be used for up to 24 months of utility payments for each project participant in any three-year period of time, provided that the project participant or a member of his/her household has an account in his/her name with a utility company and is not receiving assistance for the same period of time for the utilities.

Utility assistance may include up to six months of utility payments in arrears per service.

Payments of arrears must be counted toward the 24-month limit.

The grantee must use the Virginia Housing (VH) or the local housing authority utility allowance guideline to set reasonable limits for utility payments.

Assistance with utilities may be structured where the project participant pays a portion of the utilities. Partial assistance payment for any month of utilities counts as a month of assistance.

Utilities are limited to water/sewer, heating oil, gas, and electricity. Twenty-four month limits are based on assistance with one or more of the basic utilities per month. Since the actual number of months may be difficult to determine, grantees may estimate the total number of months covered. In these cases, the grantee must document the basis for the estimation.

Funds may be used for reasonable moving costs, such as truck rental or hiring a moving company, to assist an eligible household with housing stability.

Funds may be used for lease or apartment application fees where necessary and no other source has been identified to assist an eligible household with housing stability.

Funds may be used for reasonable project participant costs directly related to housing stabilization efforts. Project participant travel costs may include the cost for bus, taxi, or ride share services for the project participant during the housing search or unit leasing process.

Housing Stabilization Case Management Funds may be used for housing stabilization case management. This includes the costs of assessing, arranging, coordinating, and monitoring the delivery of individualized services to facilitate housing stability for project participants residing in permanent housing or to assist a project participant in overcoming immediate barriers to obtaining housing. Project participants must receive housing-focused case management at least once a month.

This assistance cannot exceed 24 months during the period the project participant is living in permanent housing.

These costs include:  Conducting initial assessments  Counseling  Facilitating access to mainstream services  Monitoring and evaluating project participant progress  Coordination with and referrals to other providers  Developing individualized housing and service plans  Fees for use of auxiliary aids and language services  Oversight and supervision of housing-focused case management staff

Prevention funds can be used for housing-focused case management alone. That is, although rental assistance cannot be provided independent of case management services, case management can be provided independent of rental assistance. For example, case

HSNH – VHSP 2022 – 2024 30 Back to topmanagement could be provided after the term of a project participant’s rental assistance expires, as long as the 24-month cap for each type of assistance is not exceeded.

“Stand alone” case management or other services can also be provided to support project participants who receive rental assistance through non-VHSP funds, as long as the individual or family is eligible for assistance at the time of the intake.

Housing Search and Placement Housing search and placement funds may be used for services or activities designed to assist individuals or families in locating, obtaining, and retaining suitable housing. Component services or activities may include education of tenant rights and responsibilities, lease requirements, securing utilities, moving arrangements, representative payee services concerning rent and utilities, and landlord outreach and mediation. Costs may also include expenditures associated with assessing housing unit compliance with property standards, lead-based paint requirements, and rent reasonableness. Expenses associated with staff salaries in the role of housing locator are eligible costs.

Housing Stabilization Services Funds may be used for services that are targeted to assist project participants to maintain housing. These may include critical skills related to household budgeting, money management, accessing a personal credit report, and resolving personal credit issues. If grantees elect to conduct credit checks on project participants, they must do so for all project participants so as not to violate Fair Housing Law or otherwise discriminate among project participants. Grantees may not use these funds to reimburse landlords for their costs associated with conducting credit and/or background checks. Credit may not be used to determine program eligibility. Payment of debt is an ineligible expense.

Service Location Costs Funds may be used for service location costs, such as rent for office space, printer/copier costs, and utilities for an office.

Emergency Shelter Operations Whenever possible, households experiencing a housing crisis should be diverted from entering the homeless services system through problem-solving conversations, linkages to mainstream and natural supports, and light-touch financial assistance through flexible funding sources.

In cases where the prevention of homelessness is not possible or safe, emergency shelter may be used as a temporary measure. Shelter operations will support low-barrier, housing-focused emergency shelter for households experiencing homelessness in Virginia. Types of shelters may include scattered site, congregate, seasonal, or hotel/motel vouchers. Transitional housing is not eligible under this program.

The focus of all shelter stays is:  To quickly obtain permanent housing (primary focus)  To obtain housing stability (secondary focus)

Project Participant Eligibility

1. Literally homeless: individuals and families who lack a fixed, regular, and adequate nighttime residence including those residing in a shelter or a place not meant for human habitation and those exiting an institution where they resided temporarily
2. At imminent risk of homelessness: individuals and families who will imminently lose their primary nighttime residence within 14 days and diversion has been attempted

HSNH – VHSP 2022 – 2024 31 Back to top 3. Households fleeing or attempting to flee domestic violence who are either literally homeless or at imminent risk of homelessness (category one and two above)

Requirements Coordination with prevention resources must be established and maintained to ensure timely referrals where appropriate. Grantees must work with local prevention services to help identify and refer all households seeking shelter where prevention of homelessness would be a viable alternative.

Participants are immediately assisted to obtain permanent housing to ensure shelter stays are minimized.

Grantees must not implement a maximum length of stay in VHSP-funded emergency shelter for persons and households experiencing homelessness.

Homeless assistance case management and services are needs-based and housing-focused with minimal barriers.

Shelters must meet basic habitability standards, pass annual fire inspections, and comply with the Americans with Disabilities Act (ADA) and Fair Housing Act standards. If the shelter is not ADA compliant, the grantee must have a plan to meet the needs of households with disabilities.

Required Documentation:  Proof of diversion at intake (see HSNH-VHSP Guidelines, page 23)  Certification form signed by the project participant stating that the project participant has received a copy of the grantee’s grievance policy  Strength-based housing barrier assessment and housing plan  Coordination with mainstream resources

Expenses Most costs associated with the operation of a shelter are eligible. These include:  Service Location Costs  Security  Maintenance  Supplies  Housing-focused case management  Limited support services (requires DHCD pre-approval)  Other (requires DHCD pre-approval)

Service location costs must be for actual leasing costs accrued by the grantee for the housing unit(s), hotel/motel vouchers, or building(s) where temporary shelter and essential services are provided. These funds may not be used to reimburse the grantee for costs associated with a mortgage or loan on the property. Other costs include rent for office space, printer/copier costs, and utilities for an office.

Both security and maintenance costs may include staff and supply costs accrued by the grantee in the performance of security and/or maintenance. Any security, maintenance, or any other contract for services must adhere to grantee procurement policies.

As condominium fees cover maintenance and sometimes utilities associated with a unit, these are allowable for grantee-owned properties utilized for programs funded through this program.

HSNH – VHSP 2022 – 2024 32 Back to topSupplies are limited to those directly related to meeting basic health and safety needs of project participants during the shelter stay. These include but are not limited to office supplies, cleaning supplies, food costs for meals provided, and bathroom supplies. Supplies do not include luxury items or items that go beyond meeting basic health and safety needs of project participants. The grantee should contact their program administrator for further guidance.

Case management must be housing-focused. Costs include:  Conducting initial assessments  Completing a strength-based housing barriers assessment and corresponding individualized housing and service plans  Assisting a project participant in overcoming immediate barriers to obtaining housing.  Facilitating access to mainstream services  Monitoring and evaluating project participant progress  Coordination with and referrals to other providers  Fees for use of auxiliary aids and language services  Oversight and supervision of engagement and housing-focused case management staff

Any support services provided must be based on project participant needs and address specific housing barriers including the cost to secure personal identification. These funds should be used as a last resort for support services and may not be used if other resources are available.

Documentation of the need for a specific support service and the lack of other available resources must be included in the project participant file in cases where these funds are used to pay for essential services. All support services costs must be pre-approved by DHCD.

Transportation costs of project participants may be eligible under the “other” category. This includes the cost of transporting project participants to shelter sites from designated pick up locations in the case of shelter models that require mass transportation. The cost of transporting emergency shelter project participants to other permanent housing solutions (such as reuniting with family or friends in another locality), may also be eligible. All “other” costs must be pre-approved by DHCD and adhere to grantee procurement policies.

Rapid Re-housing Rapid re-housing is an intervention designed to help individuals and families quickly exit homelessness and return to permanent housing. Rapid re-housing assistance is offered without preconditions (such as employment, income, absence of criminal record, or sobriety) and the resources and services provided are tailored to the unique needs of the household.

Core components:

1. Housing identification
2. Rent and move-in assistance
3. Rapid re-housing case management and services

Project Participant Eligibility Rapid re-housing assistance is limited to literally homeless households. These are households who lack a fixed, regular, and adequate nighttime residence. This includes those currently residing in a shelter and those exiting an institution (where they resided temporarily for 90 days or fewer) with no housing resources.

Veteran rapid re-housing assistance is limited to literally homeless households wherein a member of the household is a veteran. A veteran is any military member who has been released from their obligation to continue service in the armed forces. To be eligible for services an

HSNH – VHSP 2022 – 2024 33 Back to tophonorable discharge is not required; all veterans are eligible regardless of discharge type.

Veteran rapid re-housing is an eligible cost sub-category for state funded rapid re-housing only.

Duplication of assistance is not eligible. Financial assistance cannot be made on behalf of eligible individuals or families for the same period of time and for the same cost types that are being provided through another federal, state, or local housing subsidy program.

All rapid re-housing financial assistance beyond three months requires recertification of eligibility. This recertification must then be completed every three months based on the household’s project entry date for the duration of financial assistance. Recertification requires grantee documentation of the following:  Project participant household income below 30 percent of MFI  The household lacks the financial resources and support networks needed to remain in existing housing without Rapid Rehousing assistance  Housing stabilization services are being appropriately implemented

Recertification Requirement Any Financial Assistance Every three months Services/Case Management Only Every 12 months

Requirements Provision of any financial assistance should be needs based, meaning that grantees should work closely with each project participant household to determine the level and length of financial assistance necessary to obtain and maintain housing in the near term.

Rapid re-housing assistance usually begins prior to the project participant entering housing. For VHSP rapid re-housing, projects in HMIS should be set up as follows:

1. The project entry date is the date the person eligible for VHSP rapid re-housing assistance is admitted to the project, even if only in initial stage of engagement. Rapid re-housing is the only residential program that allows the project entry date to be earlier than the project participant’s move in date.
2. The Universal Data Elements and any other information required at project entry.
3. When the project participant moves into permanent housing, enter the date the household physically moved into the housing unit in the residential move-in date field.

When households are moved into a new unit and rent assistance is provided, the rent must meet two standards:  Rent Reasonableness – rent is equal to or less than other like units in the area  Fair Market Rent (FMR) – rent (including utilities) is at or below the HUD established FMR for the unit size in the area

Rent reasonableness means that the total rent charged for a unit must be reasonable in relation to the rents being charged during the same time period for comparable units in the private unassisted market and must not be in excess of rents being charged by the owner during the same time period for comparable non-luxury unassisted units. To make this determination, the grantee should consider (a) the location, quality, size, type, and age of the unit; and (b) any amenities, housing services, maintenance and utilities to be provided by the owner.

FMR limits include the cost of utilities. Grantees will need to utilize an established utility allowance in order to assess FMR limits for rents on units not including all utilities. The actual rent charged for a unit plus the allowance for any utilities that the project participant must pay themselves must not exceed the FMR for the area.

HSNH – VHSP 2022 – 2024 34 Back to topIf the gross rent for the unit exceeds either the rent reasonableness standard or the FMR, grantees are prohibited from using VHSP funds for any portion of the rent, even if the household is willing and/or able to pay the difference.

Grantees must not make payments directly to project participants, but only to landlords or property management companies. In addition, an assisted property may not be owned by the grantee or their parent, subsidiary or affiliated organization (see Conflict of Interest).

Monthly housing-focused case management is required but participation in all program services must be voluntary. Grantees must provide the appropriate level of case management in order to ensure housing stability.

Required documentation for all VHSP – RRH Project Participant client files:  Initial screening  Certification form signed by the project participant stating that the project participant has received a copy of the grantee’s grievance policy  Completed VHSP Rapid Re-housing Project Participant Eligibility Requirements.  Strength-based housing barriers assessments and housing plans.  Grantees must use HUD Published Income Limits for determining income limits  Rapid re-housing financial assistance requires that the project participant head of household have the valid lease with a landlord that is in compliance with tenant/landlord laws in their name. A copy of this lease must be included in the project participant file.  Monthly housing-focused case management is required. Grantees must provide the appropriate level of case management in order to ensure housing stability.  Grantees must have written agreements with both the project participant and the landlord that identify the terms of the rapid re-housing assistance. This should specifically provide the landlord with guidance for addressing issues which could impact housing stability and must include: o A provision requiring the owner to give the grantee a copy of any notice to the project participant to vacate the housing unit, or any complaint used under state or local law to commence an eviction action against the project participant. o The same payment due date, grace period, and late payment penalty requirements as the project participant’s lease. o The term of the rental assistance agreement for the period of time they anticipate providing assistance.  Documentation of veteran status (as appropriate)*  Veterans Department of Defense (DD) Form 214 Certificate of Release Discharge from Active Duty  VBA Statement of Service (SOS)  VHA Veteran identity card  VISTA printout from VHA healthcare provider  Hospital Inquiry System (HINQS)  VBA letter of service connected disability payment or non-service connected pension

• If documents proving veteran status are not immediately available, an Affidavit of Veteran Status signed by the veteran can be used to allow grantees to enroll veterans and initiate supportive services.

In addition, the following documentation is required for all VHSP – Rapid Rehousing Project Participants receiving rent assistance:  A completed copy of the HSNH Rent Reasonableness Worksheet with the applicable Fair Market Rents (FMR) for the area noted, and

HSNH – VHSP 2022 – 2024 35 Back to top  A copy of the completed utility allowance worksheet must be included in the project participant file. Grantees must utilize the appropriate utility allowance for any utilities that are paid by the project participant separate from rent. The grantee may use the local housing authority’s or VH's regional allowances in order to calculate the rent standard.

Expenses Eligible rapid re-housing costs include:  Rent assistance  Veterans rent assistance (State RRH only)  Rent arrears  Veterans rent arrears (State RRH only)  Housing stabilization financial assistance  Veterans housing stabilization financial assistance (State RRH only)  Housing stabilization case management  Housing search and placement  Risk Mitigation Fund (State RRH only)  Housing stabilization services  Service location costs (State RRH only)

Rental Assistance and Rent Arrears Rental assistance is tenant-based rental assistance that can be used to allow individuals and families to obtain and remain in rental units. Funds cannot be used for mortgage assistance.

Grantees must determine the amount of rental assistance provided, such as shallow subsidies (payment of a portion of the rent), payment of 100 percent of the rent, or graduated/declining subsidies. Grantees may require a project participant to share in the costs of rent.

No project participant may receive more than 24 months of assistance during any three-year period of time. Assistance with any portion of rent during a month counts as a month toward the 24-month limit.

Payment of rent arrears consists of a one-time payment for up to six months in arrears, including any late fees on those arrears. Rental arrears may be paid if the payment enables the project participant to obtain a housing unit.

If funds are used to pay rental arrears, arrears must be included in determining the total period of the project participant’s rental assistance, not to exceed 24 months. While the payment of rent arrears is a lump sum and recorded as such in HMIS, each month and the number of months most be noted in HMIS and counted toward the total rent assistances limit of 24 months.

Any individual or family receiving assistance beyond any arrears or fees and two current months of rent or financial assistance must be evaluated and recertified as eligible every three months.

Assistance should be needs-based, meaning that grantees should determine the amount of assistance based on the minimum amount needed to help the project participant maintain housing stability in the near term. This will allow communities to use program resources efficiently to serve as many households as possible.

Funds may not be used to pay damage costs incurred by the tenant.

HSNH – VHSP 2022 – 2024 36 Back to topThe rental assistance to move into a new unit cannot exceed the actual rental cost, which must be in compliance with HUD’s standard of rent reasonableness and be at or below Fair Market Rents (FMR) for the area.

Rental assistance or arrears to pay for a lot on which a manufactured or mobile home is located is an eligible expense as long as the household is otherwise eligible.

Veterans Rental Assistance and Rent Arrears Follow the above guidelines for VHSP Rental Assistance and Rent Arrears and document veteran status as indicated under RRH Requirements.

Housing Stabilization Financial Assistance Funds may be used to provide financial assistance to help project participants quickly access housing. The housing relocation and stabilization services financial assistance includes:  Security and utility deposits  Last month’s rent  Utility payments  Utility arrears  Moving costs  Application fees

Funds may be used to pay for security deposits, including utility deposits, for project participants. This is eligible in the case where the project participant is otherwise eligible and they are not receiving security or utility deposits assistance from another source. Security deposits must be paid directly to landlords or property managers.

Grantees must not take measures to recapture any deposit assistance provided to project participants. In the cases where the return of a deposit to the grantee is unavoidable, all returned deposits must be tracked as program income. Any resulting program income must be used for eligible activities.

Funds may be used for up to 24 months of utility payments for each project participant in any three-year period of time, provided that the project participant or a member of his/her household has an account in his/her name with a utility company and is not receiving assistance for the same period of time for the utilities.

Utility assistance may include up to six months of utility payments in arrears per service.

Payments of arrears must be counted toward the 24-month limit.

The grantee must use the VH or the local housing authority utility allowance guideline to set reasonable limits for utility payments.

Assistance with utilities may be structured where the project participant pays a portion of the utilities. Utilities are limited to water/sewer, heating oil, gas, and electricity. Partial assistance payment for any month of utilities counts as a month of assistance. Grantees may pay past due utilities which must be included in the 24-month limit. Twenty-four month limits are based on assistance with one or more of the basic utilities per month. As the actual number of months may be difficult to determine, grantees may use estimates to determine the total number of months covered. In these cases, the grantee must document the basis for the estimation.

Funds may be used for reasonable moving costs, such as truck rental or hiring a moving company, to assist an eligible household with housing stability.

HSNH – VHSP 2022 – 2024 37 Back to topFunds may be used for lease or apartment application fees where necessary and no other source has been identified to assist an eligible household with housing stability.

Veteran Housing Stabilization Financial Assistance Follow the above guidelines for VHSP Housing Stabilization Financial Assistance and document veteran status as indicated under RRH Requirements.

Housing Stabilization Case Management Funds may be used for housing stability case management. These are the costs of assessing, arranging, coordinating, and monitoring the delivery of individualized services to facilitate housing stability for project participants residing in permanent housing or to assist a project participant in overcoming immediate barriers to obtaining housing. Project participants must receive housing-focused case management at least once a month.

This assistance cannot exceed 30 days during the period the project participant is seeking permanent housing and cannot exceed 24 months during the period the project participant is living in permanent housing. All project participants must be moved as quickly as possible to permanent housing.

These costs include:  Conducting initial assessments  Counseling  Facilitating access to mainstream services  Monitoring and evaluating project participant progress  Coordination with and referrals to other providers  Developing individualized housing and service plans  Fees for use of auxiliary aids and language services  Oversight and supervision of housing-focused case management staff

Rapid re-housing funds can be used for housing-focused case management alone. Although rental assistance cannot be provided independent of case management, case management can be provided independent of rental assistance. For example, case management could be provided after the term of a project participant’s rental assistance expires, as long as the 24-month cap for each type of assistance is not exceeded.

“Stand alone” case management or other services can also be provided to support project participants who receive rental assistance through non-VHSP funds, as long as the individual or family is eligible for VHSP assistance at the time of the intake evaluation.

Veteran Housing Stabilization Case Management Follow the above guidelines for VHSP Housing Stabilization Case Management and document veteran status as indicated under RRH Requirements.

Housing Search and Placement Housing search and placement funds may be used for services or activities designed to assist individuals or families in locating, obtaining, and retaining suitable housing. Component services or activities may include staff costs related to: tenant counseling, assisting individuals and families to understand leases, securing utilities, making moving arrangements, representative payee services concerning rent and utilities, and outreach and negotiation with property owners related to locating or retaining housing. Costs also include expenditures associated with assessing housing unit compliance with property standards, lead requirements, and rent

HSNH – VHSP 2022 – 2024 38 Back to topreasonableness. Costs associated with staff in the role of housing locator would be eligible housing search and placement costs.

Housing Stabilization Services Funds may be used for services that are targeted to assist project participants to maintain housing. These may include critical skills related to household budgeting, money management, accessing a personal credit report, and resolving personal credit issues. If grantees elect to conduct credit checks on project participants, they must do so for all project participants so as not to violate Fair Housing Law or otherwise discriminate among project participants. Grantees may not use these funds to reimburse landlords for their costs associated with conducting credit and/or background checks. Credit may not be used to determine program eligibility. Payment of debt is an ineligible expense.

Risk Mitigation Funds Risk mitigation funds are eligible under VHSP – State Rapid Rehousing in an effort to increase the number of housing units available to persons exiting homelessness. This activity seeks to improve outreach and engagement efforts between grantees, the households they serve, and landlords or property owners. Eligible risk mitigation fund costs include: (i) the cost to repair damages incurred by the project participant not covered by the security deposit, and (ii) up to two months’ rent or until the vacancy is filled, whichever comes first, in situations where a tenant has left before the end of a lease. Both eligible expense types are offered as a last resort to maintain landlord relationships and encourage the continued reduction of rental barriers.

Any payment of risk mitigation funds must be counted toward the project participant’s 24-month of assistance limit.

Service Location Costs Funds may be used for service location costs, such as rent for office space, printer/copier costs, and utilities for an office under VHSP – State Rapid Rehousing.

CoC/LPG Planning (limited to ten percent of total VHSP base budget) CoC and Balance of State LPG lead organizations may use CoC/LPG Planning funds to meet any of the planning needs of the CoC/LPG.

Expenses Eligible costs include coordination activities, project evaluation, project monitoring, HSNH application activities, developing a CoC/LPG system, training related to the emergency crisis response system, stipends for persons with lived experience serving on leadership board or advisory groups, and compliance activities.

CoC/LPG planning costs are limited to ten percent of the total VHSP base for the entire CoC or balance of state local planning group. The base includes outreach, prevention, shelter operations, rapid re-housing, and centralized or coordinated assessment/entry.

HMIS (limited to five percent of total VHSP base budget) HMIS is a local information technology system used to collect project participant-level data and data on the provision of housing and services to homeless individuals and families and persons at risk of homelessness. Each continuum of care is responsible for selecting an HMIS software solution that complies with HUD's data collection, management, and reporting standards.

Requirements Grantees will be required to conduct data collection and reporting through the use of HMIS that meets HUD HMIS data standards, regardless of receipt of VHSP-HMIS funding. Grantees HSNH – VHSP 2022 – 2024 39 Back to topprimarily serving survivors of domestic violence and sexual assault may use another data system, and must meet all HUD HMIS data standards and reporting requirements. There are reporting requirements for both the grantee and the CoC/LPG.

Grantees (including domestic violence service providers) are required to provide VHSP reports and aggregate data to DHCD and the CoC/LPG. This includes the Consolidated Annual Performance and Evaluation Report (CAPER), the primary reporting mechanism for Emergency Solutions Grants (ESG), which is part of VHSP funding. This report requires that data be reported through a special Comma Separated Value (CSV) export.

Expenses Homeless Management Information System (HMIS) expenditures are limited to five percent of the total VHSP base funding amount which includes outreach, prevention, shelter operations, rapid re-housing, and centralized or coordinated assessment/entry.

Eligible HMIS Activities Reasonable and appropriate costs associated with operating a HMIS for purposes of collecting and reporting data required under this program and analyzing patterns of use of funds are eligible. Eligible costs include the purchase of HMIS software and/or user licenses, leasing or purchasing needed computer equipment for providers and the central server, costs associated with data collection, entry and analysis, and staffing associated with the operation of the HMIS, including training.

For DV shelter service providers, costs associated with a comparable system are eligible.

Ineligible HMIS Activities HMIS activities that are ineligible include planning and development of HMIS systems, development of new software systems, and replacing current state and local government funding for an existing HMIS.

Administrative Costs (limited to five percent of total VHSP base budget) Administrative costs may include accounting for the use of grant funds, preparing reports for submission to DHCD, obtaining program audits, similar costs related to administering the grant after the award, and associated staff salaries. Administrative costs also include staff training for program and case management, as long as this training is directly related to the provision of an emergency crisis response system. As with all billed expenditures, billing for administrative costs must be based on actual costs incurred during a particular period. Office supplies are eligible administrative costs.

No more than five percent of the total VHSP base funding amount may be spent on administrative costs. The base includes outreach, prevention, shelter operations, rapid re-housing, and centralized or coordinated assessment/entry.

While it is not necessary to detail administrative costs on reimbursements, grantees must be able to document all administrative costs and will be required to produce said documentation at the time of either on-site or desk monitorings.

HSNH – VHSP 2022 – 2024 40 Back to topHousing Opportunities for Persons With AIDS (HOPWA) The Housing Opportunities for Persons With AIDS (HOPWA) program was authorized by the National Affordable Housing Act of 1990 and revised under the Housing and Community Development Act of 1992, to provide states and localities with the resources and incentives to devise and implement long-term comprehensive strategies for meeting the housing needs of low-income persons with Acquired Immunodeficiency Syndrome (AIDS) and related diseases, and their families. Activities of primary importance are providing housing assistance and services that assist this population to maintain housing stability where they can maintain complex medication regimens and address HIV/AIDS related problems.

Funds are appropriated annually by Congress to the U.S. Department of Housing and Urban Development (HUD) for administration of this program. HOPWA funds are then awarded by formula to eligible states and Eligible Metropolitan Statistical Areas (EMSAs) that meet the minimum number of cumulative AIDS cases. States and metropolitan areas coordinate use of HOPWA funds with their respective Consolidated Plans, a collaborative process whereby the state or metropolitan area establishes a unified vision for community development actions.

As an eligible state, the Commonwealth of Virginia receives a HOPWA formula grant, administered by the Department of Housing and Community Development (DHCD). DHCD grants these HOPWA funds to eligible grantees (that operate outside the state’s EMSAs) based on a community-based application. DHCD will issue one-year contracts to HOPWA providers (sub-grantees) as a result of the HSNH application process.

Eligible Service Areas Funds received through these awards will only support project participants in programs within Virginia’s non-eligible metropolitan statistical areas (listed in the chart below). HOPWA-eligible metropolitan areas receive their HOPWA allocations directly from HUD and have specific guidelines and separate processes not included within this application process or program.

DHCD’s intention is to provide HOPWA services to eligible individuals and households within Virginia’s non-entitlement area. As resources permit, HOPWA grantees are required to provide services to eligible individuals and households outside the grantee services area.

Counties of: Accomack Charlotte King George Prince Edward Albemarle Craig Lancaster Richmond Alleghany Cumberland Lee Roanoke Amherst Dickenson Louisa Rockbridge Appomattox Essex Lunenburg Rockingham Augusta Floyd Mecklenburg Russell Bath Fluvanna Middlesex Scott Bedford Franklin Montgomery Shenandoah Bland Frederick Nelson Smyth Botetourt Giles Northampton Tazewell Brunswick Grayson Northumberland Washington Buchanan Greene Nottoway Westmoreland Buckingham Greensville Orange Wise Campbell Halifax Page Wythe Caroline Henry Patrick Carroll Highland Pittsylvania

HSNH – HOPWA 2022 – 2024 41 Back to top Independent Cities of: Bedford City Danville Lynchburg Salem Bristol Emporia Martinsville Staunton Buena Vista Galax Norton Waynesboro Charlottesville Harrisonburg Radford Winchester Covington Lexington Roanoke City

Grantee Requirements In addition to requirements set forth in the Homeless and Special Needs Housing Grantee Requirements, each grantee must adhere to the following requirements:

Local Coordination Grantees should partner with other service providers (public and private) to coordinate project participant services and fully leverage the available resources in the particular service area.

Housing Assessments and Plans All project participant files must contain an individualized housing assessment and housing and service plan with evidence of annual updates and ongoing progress. Housing assessments and plans assist in ensuring that participants achieve greater housing stability by receiving HOPWA assistance. Regulation 24 CFR 574.500(b) (2) states that the grantee (DHCD) will ensure that each project agrees to “conduct an ongoing assessment of the housing assistance and supportive services required by the participants in the program”. The housing assessment is the foundation for the development of an individualized housing and service plan that includes gathering participant information about current finances, past rental history, behavioral history and other service needs. The sub-grantee should assess housing and supportive service needs at the point of intake or application and create plans for housing stability. These plans must be updated at least annually.

HOPWA Grantee Oversight Resource Guide - This resource discusses in more detail HOPWA requirements, eligibility and monitoring requirements. It also has useful tools and forms that may assist in running the HOPWA program. Not all activities described in the guide are part of the DHCD HOPWA program.

Duplication of assistance is not eligible. Financial assistance cannot be made on behalf of eligible individuals or families for the same period of time and for the same cost types that are being provided through another federal, state, or local housing subsidy program.

HOPWA Program Administration Toolkit - The resources located here are designed to help grantees that receive HOPWA funding comply with applicable laws and regulations and administer programs more efficiently and effectively. Some of the forms that may be useful are HOPWA HQS Habitability Standards, STRMU tracking sheet, housing application and assessment, project participant files checklist, etc.

HOPWA Financial Management Training The Office of HIV/AIDS Housing (OHH) has worked with the HOPWA technical assistance staff at ICF International to develop a Financial Management Online Training course. This is a new approach to training that allows grantees and other community partners to access vital information remotely. This tool is designed to provide important information about the regulations and practices of the HOPWA program and to benefit a variety of staff. The training covers many topics including HOPWA financial management standards, management of personnel and non-personnel costs, HOPWA rental assistance and reporting, auditing and oversight of grantees. All organizations that receive HOPWA funding must have documentation on file for all applicable staff that the Financial Management Training was completed.

HSNH – HOPWA 2022 – 2024 42 Back to topHOPWA Oversight Training: https://www.hudexchange.info/trainings/hopwa-oversight-training/

Getting to Work: A Training Curriculum for HIV/AIDS Service Providers and Housing Providers: https://www.hudexchange.info/trainings/dol-hud-getting-to-work-curriculum-for-hiv-aids-providers/

HOPWA Financial Management Training course: https://www.hudexchange.info/train-ings/courses/hud-hopwa-financial-management-online-training/

Environmental Reviews Environmental reviews (ER) are required when rental assistance is provided. The environmental review form, Environmental Review for Activity/Project that is Exempt or Categorically Excluded Not Subject to Section 58.5 (Pursuant to 24 CFR 58.34(a) and 58.35(b)), must be completed for each unit/complex that falls in the flood plain or coastal barrier where rental assistance is provided.

Confidentiality Grantees must not use any identifying information that could compromise a participant’s confidentiality regarding HOPWA assistance. For example, checks to property owners, envelopes, letterhead, and other printed material should not contain any language that might indirectly disclose a participant’s HIV status.

HOPWA HQS Habitability standards inspections are required for each unit subsidized (Tenant Based Rental Assistance [TBRA] or permanent housing placement) with HOPWA assistance (except Short Term Rent, Mortgage, and Utility [STRMU). Each unit must pass a housing quality inspection to ensure the housing is safe and sanitary and in compliance with local and state housing codes, licensing standards, and any other jurisdictional requirements, and the HOPWA program habitability standards as outlined in 24 CFR 574.310(b). Housing quality inspections are made at initial move-in and annually during the term of the rental assistance. Prior to occupancy by the HOPWA-funded tenant, the unit must be inspected and approved by the grantee. The staff member performing the inspection does not need any special training, just familiarity with the HOPWA guidelines. The grantee should use the HOPWA HQS Habitability Standards form that covers the standards set out in the HOPWA regulations.

Lead-Based Paint Requirements The Lead-Based Paint Poisoning Prevention Act (42 U.S.C. 4801 et seq.), as amended by the Residential Lead-Based Paint Hazard Reduction Act of 1992 (42 U.S.C. 4851 et seq.) and implementing regulations at 24 CFR part 35, subparts A, B, M, and R shall apply to housing occupied by families receiving assistance through HOPWA, with the exception of studio units.

HUD’s lead-based paint rules apply to all housing assisted with TBRA or STRMU. Specifically, lead-based paint rules apply when:  Housing to be assisted was constructed before 1978; and  Residents will include a pregnant woman or a child 6 years of age or younger.  All housing meeting the above criteria must receive a lead-based paint visual assessment before assistance may be provided.

Staff must complete an online training course before performing visual assessments and retain the certification on file.

Project Participant Eligibility There are two basic elements of HOPWA eligibility:

HSNH – HOPWA 2022 – 2024 43 Back to top  Household has at least one person who has Acquired Immunodeficiency Syndrome (AIDS) or related diseases (Human Immunodeficiency Virus, that is, HIV infection). This includes households where the only eligible person is a minor. Medical verification of status is required.  The household must be at or below 80 percent of Area Median Income (AMI). Income limits are available on HUD’s website at: https://www.huduser.gov/portal/datasets/il.html.

Grantees must document and date the determination of income eligibility, using the HUD Income Calculator. This documentation including all required source documentation must be included in the project participant file. In the case of no household income, a project participant certified statement of no income is allowable.

All participant files must contain documentation of an intake assessment that verifies the participants’ eligibility to receive HOPWA assistance. Low-income people living with Acquired Immunodeficiency Syndrome (AIDS) or Human Immunodeficiency Virus (HIV) diagnosis and their families are eligible to receive HOPWA assistance. Acceptable medical documentation of HIV status includes:  A statement of HIV verification signed by a physician, certified health care worker, or HIV testing site representative;  Social Security Administration records indicating the nature of a disability determination;  Other relevant federal program records verifying HIV status.

Participant eligibility status, household composition, and rental payments must be recertified at least annually. The grantee must have a method in place for tracking participant eligibility and verifying income that looks for changes in income, family composition, and circumstances. The grantee must have policies and procedures that require the participant to notify the organization of any changes during the course of a program year.

Grantees must have signed releases of information from HOPWA participants that allow for obtaining and storing HIV status documentation. As part of a private medical record, such information is highly confidential and protected by state laws that govern HIV status information (see Confidentiality Policy).

Eligible beneficiaries are individuals or households with a total household income at or below 80 percent of the median income for the area (Area Median Income or AMI), as defined by HUD.

HUD AMIs are calculated annually for individual localities and organized by number of persons in the household. Area Median Income charts: https://www.huduser.gov/portal/datasets/il.html.

For detailed information and online training material regarding how to calculate annual income, visit HUD’s website. In calculating eligibility, the entire household income must be taken into account, not just the income of the HOPWA-eligible person. The number of persons living in the household applying for assistance must also be verified. A statement from the participant regarding household composition is acceptable documentation.

The grantee must have income verification for all adult members of a household (including any minor’s income). If an adult member of a household has no verifiable income, the grantee must have the person sign a certification stating that he/she has no income.

Income documentation should reflect current income. Typically, income statements should be less than 90 days old based on the date of eligibility determination. Eligibility must be verified annually, taking into account possible changes in household income.

To receive HOPWA housing assistance and supportive services, at least one family member must have HIV/AIDS and the household must income-qualify. The HOPWA-eligible person in

HSNH – HOPWA 2022 – 2024 44 Back to topany household can be a minor. The minor child must reside in the household at least 51 percent of the time. However, an adult with custodial authority must accompany the eligible minor. In such a case, the “head of the household” is the custodial adult.

Eligible Activities The 2020-22 HOPWA funds will support direct housing assistance to those most in need and supportive services for the HOPWA-eligible individuals.  Tenant-based Rental Assistance (TBRA)  Short-term Rent, Mortgage, and Utility (STRMU) Assistance  Supportive Services  Housing Information Services (limited to three percent)  Administrative Costs (limited to seven percent)

Tenant-based Rental Assistance (TBRA) Tenant-based rental assistance is a rental subsidy used to help participants obtain permanent housing in the private rental housing market that meets housing quality standards and is rent reasonable. Working much like the Section 8 Housing Choice Voucher Program, HOPWA tenant-based assistance pays the difference between the Fair Market Rent and the tenant’s portion of the rent. With TBRA, the HOPWA grantee makes rental payments directly to property owners or property management companies. While the HOPWA subsidy covers a portion of the full rent, the tenant also pays a portion based on their adjusted income or gross income.

There are three key elements for the determination of the HOPWA TBRA assistance:  Calculation of gross and adjusted household income;  Calculation of tenant rent payment (based on income); and  Calculation of HOPWA subsidy payment.

Requirements In addition, participant files must contain proper documentation to support any use of the Earned Income Disregard. The Earned Income Disregard, as it is commonly called, allows qualified individuals and families receiving housing assistance to keep more of their earned income for a period of up to two years following an increase in employment income. The HOPWA Program Administration Toolkit provides guidance on implementing the Earned Income Disregard for the purpose of calculating project participant income and resident rent payment.

All units must comply with HOPWA rent and habitability standards.

Participant eligibility status, household composition, and rental payments should be recertified at least annually. The grantee should have a method in place for tracking participant eligibility and verifying income that looks for changes in income, family composition, and circumstances. The grantee must have policies and procedures in place that require the participant to notify the grantee of income changes during the course of a program year.

Grantees may enter into annual renewable contracts with project participants. Grantees will be required to ensure that all property and occupancy standards continue to be met through the entire contract period. Grantees must reexamine participant’s family income, size, and composition at least once a year.

Grantees must not make payments directly to project participants, but only to landlords or property management companies.

Required Documentation:  Properly calculated household income;

HSNH – HOPWA 2022 – 2024 45 Back to top  Income verification using third-party sources (e.g., pay stubs, earning statements, checks, W-2 forms, and income tax returns);  If a participant reports no income, a signed and witnessed “Verification of No Income”;  Determination of income eligibility (does not require a signature);  Properly calculated project participant rent payment;  Verification that the HOPWA subsidy was properly calculated, including use of utility allowances (when applicable) and FMR rent standards;  Verification of rent reasonableness;  Verification that the housing meets habitability and lead standards;  Housing assessment and plan (completed at least annually);  Verification of HIV/AIDS status; and  Copy of valid lease.

Expenses Eligible costs include rent (not mortgage payments) and utility costs.

For further guidance on rent and utility cost calculations, refer to HUD’s HOPWA Grantee Oversight Resource Guide, Chapter 4, Tenant Based Rental Assistance.

HOPWA participant rent payments will be the higher of two amounts:  10 percent of gross household income;  30 percent of adjusted income.

Short-term Rent, Mortgage, and Utility (STRMU) Assistance STRMU is time-limited housing assistance designed to prevent homelessness and increase housing stability for project participants with an emergency need. Used in connection with other HOPWA activities and other local, state, and federal resources, STRMU can lead to long-term solutions to housing problems for participants receiving this time-limited housing assistance.

Project Participant Eligibility STRMU is designed to be a short-term, needs-based intervention to prevent homelessness.

Individuals must meet the following additional criteria in order to receive STRMU assistance:  Project participant must be currently housed. Homeless individuals are not eligible for STRMU assistance. Assistance is provided to help homeowners and renters remain in their current place of residence.  Project participant must be able to document that he/she has a legal right to occupy premises or has responsibility for the utility payment. Examples of acceptable documentation are as follows: o Rental payments: Project participant must be named tenant under valid lease or referenced in lease as occupant of the premises. o Mortgage payments: Project participant must demonstrate that he/she is owner of mortgaged property (mortgage, deed of trust, title insurance policy). o Utility payments: Project participant must have account in their name or proof of responsibility to make utility payments (copies of money orders, cancelled checks, receipts).  Project participant must demonstrate he/she does not have the resources to meet rent, mortgage, or utility payments and, in the absence of STRMU assistance, would be at risk of homelessness. o Documentation of a default or late payment notice is not required; project participant can provide copies of bank statements and bills to demonstrate need.

Requirements Grantees may provide assistance for a period of up to 21 weeks in any 52-week program year period (for example, not exceeding 21 weeks in the period of July 1, 2020-June 30, 2021). The HSNH – HOPWA 2022 – 2024 46 Back to topamount of assistance varies per project participant depending on funds available, tenant need and program guidelines. STRMU is intended for project participants with an emergency need and not intended to provide long-term financial assistance.

Example of “Emergency Need”  Grantee experiences a sudden loss of income due to changes in health  Grantee has lost employment and has not yet been found eligible for SSDI  Grantee’s household loses a source of income when family composition changes  Due to above, grantee family faces eviction, foreclosure or utilities shut-off  Grantee faces extraordinary and unexpected health care costs

Grantees must not make payments directly to project participants, but only to landlords or property management companies.

Grantees may establish caps (limits) for rent, mortgage, or utility assistance.

Required Documentation:  AIDS/HIV status;  Documentation of determination of income eligibility (does not require a signature);  Properly calculated household income;  Need for STRMU assistance;  Time limits are consistent with 21 weeks of assistance in a 52-week program year (for example: Not exceeding 21 weeks in period between July 1, 2022-June 30, 2023);  Housing meets lead-based paint requirements;  Housing assessment and plan updated at least annually; and  Copy of valid lease.

Expenses Eligible STRMU expenses include:  Rent and mortgage assistance o Must be reasonable and represent actual housing costs o The amount of assistance provided is not limited to Fair Market Rents or “reasonable rent” limits o Unlike other forms of HOPWA assistance, tenants are not required to pay 30 percent of their income towards the rent or mortgage payment. However, if they are able, project participants should pay a portion of their housing costs as any portion paid by the tenant does not count against the 21-week STRMU benefit ceiling. If grantees decide on this method, they must have a policy and procedure in place to ensure that this is calculated and documented clearly and tracked appropriately. The policy and procedure must be pre-approved by DHCD.  Late fees o Late fees and other penalties may be paid if, in the event of nonpayment, the household is at risk of eviction or loss of housing. o Utility assistance late fees may be paid  Utility payments

Ineligible STRMU expenses include:  Security deposits and first month’s rent o STRMU assistance is designed to help homeowners and renters stay in their current place of residence; as a result, security deposits and first month’s rent are not eligible costs under STRMU. However, these costs are eligible as permanent housing placement costs (under the supportive services activity).  Moving assistance HSNH – HOPWA 2022 – 2024 47 Back to top  Household supplies and furnishings  Automobile expenses  Telephone expenses o Telephone expenses are not payable as a utility expense under STRMU.

However, such expenses may be covered as a supportive service expense in limited circumstances.

Supportive Services Supportive services are important tools in helping project participants and family members stabilize their living situations and help address care needs of persons living with HIV infection.

To be eligible for supportive services, a project participant and family members are not required to receive housing financial assistance.

The primary purpose of HOPWA programs is housing assistance.

Requirements Services provided with HOPWA funds must focus on supporting the housing stability of project participants. All supportive service expenses for the HOPWA program must be documented as being last resort. The sub-grantee must document reasonable efforts to qualify recipients for other programs that might pay for supportive services in the project participant’s individual housing service plan.

In addition, sub-grantees must report the following at the end of the year:  The number of eligible households that received the specific service;  The amount expended by the sub-grantee in the specific category; and  The value of other non-HOPWA funds leveraged for this activity.

Permanent housing placement is also designated as supportive services in the reporting forms, but as separate budget line items and tracked separately as a data element.

Required Documentation:  Documentation of HIV status;  Documentation of determination of income eligibility (does not require a signature);  Properly calculated household income;  Documentation of need for supportive service assistance;  Housing assessment and plan;  Recipients of supportive services are eligible, as defined by HOPWA regulations;  The activity itself is an eligible HOPWA activity;  The services are adequate and appropriate for the level of support required by participants; and  Records of supportive services to validate beneficiary data and reported expenditures.

Expenses The following are eligible expenses under HOPWA Supportive Services and need to be reported in HOPWA year-end performance reports:  Adult day care and personal assistance  Alcohol and drug abuse services  Case management/advocacy/coordination of benefits  Child care  Education  Employment assistance and training for persons with HIV/AIDS

HSNH – HOPWA 2022 – 2024 48 Back to top  Health and medical services (health services may only be provided to “individuals with acquired immunodeficiency syndrome or related diseases and not to family members” (24 CFR 574.300b(7))  Legal services  Life skills management  Nutritional services (including meals)  Mental health services  Outreach  Transportation

Permanent Housing Placement Permanent housing placement services may be used to help eligible persons establish a new residence where ongoing occupancy is expected to continue. It may be used to compliment other forms of HOPWA housing assistance.

Requirements Permanent Housing Placement is a subset of supportive services that is tracked separately.

Expenses Eligible permanent housing placement costs include:  Housing location services  Permanent housing placement financial assistance

Housing Location Services Housing location services funds may be used for services or activities designed to assist individuals or families in locating, obtaining, and retaining suitable housing. Component services or activities may include housing referral and tenant counseling (understanding a residential lease and its obligations, mediation of disputes, etc.).

Permanent Housing Placement Financial Assistance Funds may be used to provide financial assistance to help project participants access housing.

Eligible expenses include:  Application fees and credit check expenses  First month’s rent and security deposit (not to exceed two months’ rent)  One-time utility connection fees and processing credit

These costs, including security deposits, are not considered rental assistance and should be billed as a supportive service. Placement costs cannot exceed the value of two months’ rent in the new unit. Further, such funds should be designated to be returned to the sub-grantee’s HOPWA program when beneficiaries vacate the new unit. Returned funds should be recorded and tracked as program income and used for HOPWA program purposes.

Ineligible permanent housing expenses include but are not limited to moving costs, standard furnishings, and housekeeping/household supplies.

Housing Information Services (limited to three percent of total HOPWA budget) HOPWA allows for payment of HMIS costs and participation.

Requirements If participating in HMIS, the HOPWA providers must use the system to enhance service coordination and project participant access to community assistance programs and must collect all of the Universal Data Elements and Program-Specific Data Elements. See HOPWA Program HMIS Manual.

HSNH – HOPWA 2022 – 2024 49 Back to topExpenses Sub-grantees may use up to three (3) percent of the overall HOPWA award for HMIS costs.

Sub-grantees should use the Housing Information Services line item for HMIS costs associated with tracking project participant access and services (data entry).

However, when the systems are developed or are being used by staff for data reporting, the costs are considered administrative costs and are subject to the applicable administrative cost limit.

Administrative Costs (limited to seven percent of total HOPWA budget) Eligible administrative costs include expenses that support program operations, such as bookkeeping and the compilation and reporting of data.

Requirements As with all billed expenditures, billing for administrative costs must be based on actual costs incurred during a particular period.

As with personnel costs, basing administrative charges on a straight pro-rated amount of the total grant (e.g., seven percent of the total amount awarded to the grantee divided into constant monthly increments) may be helpful for budgeting but is not adequate. Rather, administrative charges should be based on the actual monthly program costs, which should vary each month.

While it is not necessary to detail administrative costs on reimbursements, grantees must be able to document all administrative costs and will be required to produce said documentation at the time of either on-site or desk monitorings.

HSNH – HOPWA 2022 – 2024 50 Back to topVirginia Housing Trust Fund: Homeless Reduction Grant The goal of the Virginia Housing Trust Fund Homeless Reduction Grant program is to reduce homelessness in the Commonwealth of Virginia. DHCD will support continuum of care (CoC)/balance of state local planning group (LPG) strategies and homeless service projects that are or will be a part of an effective emergency crisis response system to ensure that homelessness is rare, brief, and one-time.

The Homeless Reduction Grant program must be coordinated with other community-based activities. All CoCs, LPGs, and DHCD homeless services grantees use a local centralized or coordinated assessment/entry system. A local centralized or coordinated assessment/entry system is the best practice for a housing-focused approach targeted toward helping households experiencing homelessness quickly regain stability in permanent housing.

Background The Virginia Housing Trust Fund is estimated to increase significantly this fiscal year. It is estimated that $8,300,000 will be available for HTF Homeless Reduction Grants this fiscal year.

This funding amount is subject to change. This funding provides grants for targeted efforts to reduce homelessness. Priority consideration will be given to efforts to reduce the number of youth and families experiencing homelessness. Funding will be awarded to projects best aligned with state and federal goals to end homelessness in communities throughout the commonwealth.

Eligible Grantees Eligible grantees are units of local government, non-profit organizations, housing developers (non-profit and for-profit), Community Housing Development Organizations (CHDOs), single purpose organizations, or limited liability corporations (LLCs). The preferable grantee is the primary partner in the LLC, development team, or the individual organization that will have the ongoing responsibility for the project. Proposed projects that will leverage multiple partners and subcontracts are allowable.

The grantee is the entity responsible for compliance. DHCD may not enter into program contracts with any grantee with outstanding audit findings, IRS findings, DHCD monitoring findings or other compliance issues. However, DHCD will work with all interested parties toward the resolution of outstanding issues, as appropriate.

Grantee Requirements Each grantee must adhere to the requirements set forth in the Homeless and Special Needs Housing guidelines.

Eligible Activities Eligible projects are designed to reduce homelessness, are located within Virginia, and include:  Rapid Re-housing  Underserved Populations Innovation Project  Permanent Supportive Housing (housing stabilization services and rental assistance for chronically homeless)  Administrative Costs

Rapid Re-housing Rapid re-housing is an intervention designed to help individuals and families quickly exit homelessness and return to permanent housing. Rapid re-housing assistance is offered without preconditions (such as employment, income, absence of criminal record, or sobriety) and the resources and services provided are tailored to the unique needs of the household.

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Back to topCore components:

1. Housing identification
2. Rent and move-in assistance
3. Rapid re-housing case management and services

Project Participant Eligibility Rapid re-housing assistance is limited to literally homeless households. These are households who lack a fixed, regular, and adequate nighttime residence. This includes those currently residing in a shelter and those exiting an institution (where they resided temporarily for 90 days or fewer) with no housing resources.

Duplication of assistance is not eligible. Financial assistance cannot be made on behalf of eligible individuals or families for the same period of time and for the same cost types that are being provided through another federal, state, or local housing subsidy program.

All rapid re-housing financial assistance beyond three months requires recertification of eligibility. This recertification must then be completed every three months based on the household’s project entry date for the duration of financial assistance. Recertification requires grantee documentation of the following:  Project participant household income below 30 percent of MFI  The household lacks the financial resources and support networks needed to remain in existing housing without Rapid Rehousing assistance  Housing stabilization services are being appropriately implemented

Recertification Requirement Any Financial Assistance Every three months Services/Case Management Only Every 12 months

Requirements Provision of any financial assistance should be needs based, meaning that grantees should determine the amount of assistance based on the minimum amount needed to maintain housing stability in the near term. This will allow communities to use program resources efficiently to serve as many households as possible.

When households are moved into a new unit, the rent must meet two standards:  Rent Reasonableness – rent is equal to or less than other like units in the area  Fair Market Rent (FMR) – rent (including utilities) is at or below the HUD established FMR for the unit size in the area

Rent reasonableness means that the total rent charged for a unit must be reasonable in relation to the rents being charged during the same time period for comparable units in the private unassisted market and must not be in excess of rents being charged by the owner during the same time period for comparable non-luxury unassisted units. To make this determination, the grantee should consider (a) the location, quality, size, type, and age of the unit; and (b) any amenities, housing services, maintenance and utilities to be provided by the owner.

FMR limits include the cost of utilities. Grantees will need to utilize an established utility allowance in order to assess FMR limits for rents on units not including all utilities. The actual rent charged for a unit plus the allowance for any utilities that the project participant must pay themselves must not exceed the FMR for the area.

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Back to topIf the gross rent for the unit exceeds either the rent reasonableness standard or the FMR, grantees are prohibited from using VHSP funds for any portion of the rent, even if the household is willing and/or able to pay the difference.

Grantees must not make payments directly to project participants, but only to landlords or property management companies. In addition, an assisted property may not be owned by the grantee or their parent, subsidiary or affiliated organization (see Conflict of Interest).

Monthly housing-focused case management is required but participation in all program services must be voluntary. Grantees must provide the appropriate level of case management in order to ensure housing stability.

Required Documentation:  All project participants must receive an initial screening  Certification form signed by the project participant stating that the project participant has received a copy of the grantee’s grievance policy  All project participants must receive initial eligibility certification using DHCD’s VHSP Rapid Re-housing Project Participant Eligibility Requirements.  All households must have strength-based housing barriers assessments and housing plans.  Grantees must use HUD Published Income Limits for determining income limits  A copy of the HSNH Rent Reasonableness Worksheet and Fair Market Rents (FMR) for the area must be completed and included in the project participant file.  A copy of the completed utility allowance worksheet must be included in the project participant file. Grantees must utilize the appropriate utility allowance for any utilities that are paid by the project participant separate from rent. The grantee may use the local housing authority’s or Virginia Housing's appropriate regional allowances in order to calculate the rent standard.

• Rapid re-housing financial assistance requires that the project participant head of household have the valid lease with a landlord or a master lease agreement that is in compliance with tenant/landlord laws in their name. For master lease agreements, these must be legally binding for a duration of at least 6 months and participation in any program or service must not be a requirement for tenancy. A copy of the lease must be included in the project participant file.  Monthly housing-focused case management is required. Grantees must provide the appropriate level of case management in order to ensure housing stability.  Grantees must have written agreements with both the project participant and the landlord that identify the terms of the rapid re-housing assistance. This should specifically provide the landlord with guidance for addressing issues which could impact housing stability and must include: o A provision requiring the owner to give the grantee a copy of any notice to the project participant to vacate the housing unit, or any complaint used under state or local law to commence an eviction action against the project participant. o The same payment due date, grace period, and late payment penalty requirements as the project participant’s lease. o The term of the rental assistance agreement for the period of time they anticipate providing assistance.

Expenses Eligible rapid re-housing costs include:  Rent assistance  Rent arrears  Housing stabilization financial assistance

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Back to top  Housing stabilization case management  Housing search and placement  Housing stabilization services  Service location costs

Rental Assistance and Rent Arrears Rental assistance is tenant-based rental assistance that can be used to allow individuals and families to obtain and remain in rental units. Funds cannot be used for mortgage assistance.

Grantees must determine the amount of rental assistance provided, such as shallow subsidies (payment of a portion of the rent), payment of 100 percent of the rent, or graduated/declining subsidies. Grantees may require a project participant to share in the costs of rent.

No project participant may receive more than 12 months of assistance. Assistance with any portion of rent during a month counts as a month toward the 12-month limit.

Payment of rent arrears consists of a one-time payment for up to six months in arrears, including any late fees on those arrears. Rental arrears may be paid if the payment enables the project participant to obtain a housing unit.

If funds are used to pay rental arrears, arrears must be included in determining the total period of the project participant’s rental assistance, a period not to exceed 12 months. While the payment of rent arrears is a lump sum and recorded as such in HMIS, each month and the number of months most be noted in HMIS and counted toward the total rent assistance limit of 12 months.

Any individual or family receiving assistance beyond any arrears and two months of rent and financial assistance must be evaluated and recertified as eligible every three months.

Assistance should be needs based, meaning that grantees should determine the amount of assistance based on the minimum amount needed to help the project participant maintain housing stability in the near term. This will allow communities to use program resources efficiently to serve as many households as possible.

Funds may not be used to pay damage costs incurred by the tenant.

The rental assistance to move into a new unit cannot exceed the actual rental cost, which must be in compliance with HUD’s standard of rent reasonableness and be at or below Fair Market Rents (FMR) for the area.

Rental assistance or arrears to pay for a lot on which a manufactured or mobile home is located is an eligible expense as long as the household is otherwise eligible.

Rental assistance provided toward rent for a housing unit owned by a grantee, related entity, or partner is prohibited.

Housing Stabilization Financial Assistance Funds may be used to provide financial assistance to help project participants quickly access housing. The housing relocation and stabilization services financial assistance includes:  Security and utility deposits  Last month’s rent  Utility payments and arrears  Moving costs  Application fees

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Back to topFunds may be used to pay for security deposits, including utility deposits, for project participants. This is eligible in the case where the project participant is otherwise eligible and they are not receiving security or utility deposits assistance from another source. Security deposits must be paid directly to landlords or property managers.

Grantees must not take measures to recapture any deposit assistance provided to project participants. In the cases where the return of a deposit to the grantee is unavoidable, all returned deposits must be tracked as program income. Any resulting program income must be used for eligible activities.

Funds may be used for up to 12 months of utility payments for each project participant in any three-year period of time, provided that the project participant or a member of his/her household has an account in his/her name with a utility company and is not receiving assistance for the same period of time for the utilities.

Utility assistance may include up to six months of utility payments in arrears per service.

Payments of arrears must be counted toward the 12-month limit.

The grantee must use the Virginia Housing or the local housing authority utility allowance guideline to set reasonable limits for utility payments.

Assistance with utilities may be structured where the project participant pays a portion of the utilities. Partial assistance payment for any month of utilities counts as a month of assistance.

Grantees may pay past due utilities; however, the past due months must be included in the 12-month limit. Utilities are limited to water/sewer, heating oil, gas, and electricity. Twelve month limits are based on assistance with one or more of the basic utilities per month. Since the actual number of months may be difficult to determine, grantees may use estimates to determine the total number of months covered. The basis for the estimation must be included in the client file.

Funds may be used for reasonable moving costs, such as truck rental or hiring a moving company, to assist an eligible household with housing stability.

Funds may be used for lease or apartment application fees where necessary and no other source has been identified to assist an eligible household with housing stability.

Housing Stabilization Case Management Funds may be used for housing stability case management. These are the costs of assessing, arranging, coordinating, and monitoring the delivery of individualized services to facilitate housing stability for project participants residing in permanent housing or to assist a project participant in overcoming immediate barriers to obtaining housing. Project participants must receive housing-focused case management at least once a month.

This assistance cannot exceed 12 months during the period the project participant is living in permanent housing.

These costs include:  Conducting initial assessments  Counseling  Facilitating access to mainstream services  Monitoring and evaluating project participant progress  Coordination with and referrals to other providers  Developing individualized housing and service plans  Fees for use of auxiliary aids and language services

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Back to topRapid re-housing funds can be used for housing-focused case management alone. Although rental assistance cannot be provided independent of case management, case management can be provided independent of rental assistance. For example, case management could be provided after the term of a project participant’s rental assistance expires, as long as the 12-month cap for each type of assistance is not exceeded.

“Stand alone” case management or other services can also be provided to support project participants who receive rental assistance through non-VHSP funds, as long as the individual or family is eligible for VHSP assistance at the time of the intake evaluation.

Housing Search and Placement Housing search and placement funds may be used for services or activities designed to assist individuals or families in locating, obtaining, and retaining suitable housing. Component services or activities may include staff costs related to: tenant counseling, assisting individuals and families to understand leases, securing utilities, making moving arrangements, representative payee services concerning rent and utilities, and outreach and negotiation with property owners related to locating or retaining housing. Costs also include expenditures associated with assessing housing unit compliance with property standards, lead requirements, and rent reasonableness. Costs associated with staff in the role of housing locator would be eligible housing search and placement costs.

Housing Stabilization Services Funds may be used for services that are targeted to assist project participants to maintain housing. These may include critical skills related to household budgeting, money management, accessing a personal credit report, and resolving personal credit issues. If grantees elect to conduct credit checks on project participants, they must do so for all project participants so as not to violate Fair Housing Law or otherwise discriminate among project participants. Grantees may not use these funds to reimburse landlords for their costs associated with conducting credit and/or background checks. Credit may not be used to determine program eligibility. Payment of debt is an ineligible expense.

Service Location Costs Funds may be used for service location costs, such as rent for office space, printer/copier costs, and utilities for an office.

Underserved Populations Innovation Project The purpose of the Underserved Populations Innovation Project is to support innovative local efforts to serve members of an underserved population experiencing homelessness and pilot new models of assistance to determine the array of interventions necessary to serve the target population.

Client Eligibility The Underserved Population Innovation Project targets members of an underserved population that are experiencing homelessness.

Underserved populations are defined by a lack of resources targeted towards providing culturally appropriate and trauma-informed services for a vulnerable population.

Examples of underserved populations include but are not limited to:  Persons 60 years of age or older  Unaccompanied youth aged 18 to 24  Persons identifying as LGBTQ+

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Back to top  Persons with disabilities, including physical or cognitive impairments, or substance use disorder  Persons living in rural areas o “Rural” encompasses all population, housing, and territory not included with an urban area as indicated by the U.S. Census Bureau’s 2020: Virginia Core Based Statistical Areas and Counties Map.

Projects serving monolithic groups based on race, color, national origin, or religious ideologies will not be permitted for the use of HTF – HRG funding.

All projects, unless otherwise stated, must utilize the U.S. Department of Housing and Urban Development (HUD) Category 1 definition of literal homelessness.

Literal Homelessness is defined as: Any individual or family who lacks a fixed, regular, and adequate nighttime residence, meaning: (i) Has a primary nighttime residence that is a public or private place not meant for human habitation; (ii) Is living in a publicly or privately operated shelter designated to provide temporary living arrangements (including congregate shelters, transitional housing, and hotels and motels paid for by charitable organizations or by federal, state and local government programs); or (iii) Is exiting an institution where (s)he has resided for 90 days or less and who resided in an emergency shelter or place not meant for human habitation immediately before entering that institution

Grantees targeting unaccompanied homeless youth may choose to employ the following two definitions of homelessness:

1. U.S. Department of Education (ED) Subtitle VII-B of the McKinney-Vento Homeless Assistance Act defines homeless children and youths as follows: The term "homeless children and youths"— A. means individuals who lack a fixed, regular, and adequate nighttime residence (within the meaning of section 11302(a)(1) of this title); and B. includes— i. children and youths who are sharing the housing of other persons due to loss of housing, economic hardship, or a similar reason; are living in motels, hotels, trailer parks, or camping grounds due to the lack of alternative adequate accommodations; are living in emergency or transitional shelters; are abandoned in hospitals; or are awaiting foster care placement; ii. children and youths who have a primary nighttime residence that is a public or private place not designed for or ordinarily used as a regular sleeping accommodation for human beings (within the meaning of section 11302(a)(2)(C) of this title); iii. children and youths who are living in cars, parks, public spaces, abandoned buildings, substandard housing, bus or train stations, or similar settings; and iv. migratory children (as such term is defined in section 6399 of title 20) who qualify as homeless for the purposes of this subtitle because the children are living in circumstances described in clauses (i) through (iii). 42 U.S.C. § 11434a(2)

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Back to top Subtitle VII-B of the McKinney-Vento Homeless Assistance Act defines unaccompanied youth as follows: The term “unaccompanied youth” includes a youth not in the physical custody of a parent or guardian. 42 U.S.C. § 11434a(6)

1. U.S. Department of Housing and Urban Development (HUD) Category 1: Literally Homeless - Individual or family who lacks a fixed, regular, and adequate nighttime residence, meaning: (iv) Has a primary nighttime residence that is a public or private place not meant for human habitation; (v) Is living in a publicly or privately operated shelter designated to provide temporary living arrangements (including congregate shelters, transitional housing, and hotels and motels paid for by charitable organizations or by federal, state and local government programs); or (vi) Is exiting an institution where (s)he has resided for 90 days or less and who resided in an emergency shelter or place not meant for human habitation immediately before entering that institution

Housing solutions assistance must be offered without preconditions (such as employment, income, absence of criminal record, or sobriety).

Eligible Activities There are three categories of Underserved Populations Innovation Project activities:  Innovative Project Planning  Homeless Underserved Populations Outreach/Engagement  Housing Solutions

All HTF – HRG – Underserved Populations Innovation Projects must include the Innovative Project Planning activity and may or may not include Homeless Underserved Populations Outreach/Engagement, and/or Housing Solutions.

Innovative Project Planning Innovative Project Planning funds may be used to develop and/or pilot new models of assistance to best meet the needs of underserved populations experiencing homelessness. All projects must be designed to meet the unique needs of the target population in their community.

Requirements The project must be designed to meet at least one of the following core components:

1. Effectively identify and engage members of the underserved population at risk of or experiencing homelessness and connect them with trauma-informed, culturally appropriate, and developmentally and age-appropriate interventions;
2. Intervene early when members of the underserved population do become homeless and work to divert the individual or household from the experience of homelessness when safe and appropriate;
3. Develop coordinated entry systems to identify members of the underserved population for appropriate types of assistance and to prioritize resources for the most vulnerable;
4. Ensure access to safe shelter and emergency services when needed;
5. Ensure assessments respond to the unique needs and circumstances of members of the underserved population and emphasize strong connections to and supported exits from mainstream systems as needed;
6. Create individualized services and housing options tailored to the needs of each individual or household, and include measurable outcomes across key indicators of performance, including education and employment;

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Back to top 7. Perform a needs assessment of the capacity of the current local crisis response system and existing projects to serve members of the underserved population;

1. Develop an assessment to determine the level of housing and supportive services needs of members of the underserved population experiencing homelessness. This should include a recommendation for type of housing intervention to be utilized based on the individual or household’s level of need;
2. Review opportunities in the local crisis response system and system’s existing projects to implement best practices that are specifically focused on helping members of the underserved population to stabilize in housing and implement the types of housing interventions which are most successful in resolving the housing crisis and setting up the individual or household for an enhanced quality of life (i.e. addressing connections to healthcare and mitigating social isolation); 10. Maintain an inventory of the community’s resources to support members of the underserved population, especially those that assist with stabilization; 11. Develop a collaborative partnership to address discharge planning with institutions such as jails or other corrections facilities, hospitals, addiction treatment facilities, child welfare facilities, or mental health programs; AND/OR 12. Establish an inter-disciplinary coalition between the CoC/LPG leadership, community homeless services projects, and mainstream resources that serve members of the underserved population.

All projects must provide opportunity for involvement by members of the underserved population. Members of the underserved population including homeless and formerly homeless individuals, must be involved in the development, implementation, and evaluation of the Innovative Project Planning and any input must be implemented to the extent that is appropriate for the project and feasible within statutory and regulatory guidelines.

All projects must also review opportunities to raise funding and create proposals that establish new Housing First projects or expand existing projects that support housing-focused solutions for members of the underserved population experiencing homelessness.

Expenses Eligible costs include coordination activities, project planning and design activities, consulting fees, project evaluation, and training related to the pilot project. Stipends and consulting fees as compensation for individuals with lived experience for their participation and shared expertise are eligible expenses.

Homeless Underserved Populations Outreach/Engagement Homeless Underserved Populations Outreach/Engagement includes essential services related to identifying and engaging members of the underserved population at risk of, or experiencing homelessness, and connecting them with trauma-informed, culturally appropriate, and developmentally and age-appropriate interventions.

Outreach services should coordinate a comprehensive set of strategies, spanning the homeless crisis response system, other systems of care, and mainstream resources as appropriate for the underserved population. For example, projects designed to serve unaccompanied homeless youth aged 18 to 24 should work with schools, the child welfare system, the criminal processing system, drop-in centers, hotlines, and 2-1-1 Virginia.

Whenever possible, outreach services should employ prevention and diversion strategies, and otherwise secure immediate access to low-barrier crisis housing and services for members of the underserved population should they so choose. Prevention and diversion strategies may

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Back to topinclude: connecting and/or reunifying individuals with members of their family or other natural supports (as defined by each household).

Requirements All outreach efforts must be client-centered and tailored to the unique needs of the underserved population.

Required Documentation  Individualized service plan, to include housing options  Evidence of connection with the community’s coordinated entry process (as appropriate)  Coordination with mainstream resources

Expenses Eligible Homeless Underserved Populations Outreach/Engagement costs include:  Essential Services – Case Management  Essential Services - Limited Support Services (requires DHCD pre-approval)  Service location costs  Other (requires DHCD pre-approval)

Essential Services – Case Management Funds may be used for engagement and housing-focused case management. These are the costs of locating, identifying, and building relationships with youth experiencing homelessness and the cost of assessing housing and service needs, arranging, coordinating, and monitoring the delivery of individualized services to meet the needs of the youth program participant. Costs include staff expenses related to:  Connecting with centralized or coordinated assessment system;  Actively connecting and providing information and referrals to programs targeted to people experiencing homelessness and mainstream resources and housing programs;  Conducting and documenting an initial assessment of needs and eligibility;  Providing crisis counseling;  Addressing urgent physical needs;  Completing a strength-based housing barriers assessment and corresponding individualized housing and service plans;  Assisting a program participant in overcoming immediate barriers to housing; and  Monitoring and evaluating program participant progress.

Essential Services - Limited Support Services Includes the transportation costs of travel by outreach workers, social workers, medical professionals, or other service providers are eligible, provided that this travel takes place during the provision of services eligible under this section. The costs of transporting unsheltered people to emergency shelters or other service facilities are also eligible. These costs include the use of public transportation and rideshare programs by the project participant.

Service Location Costs Funds may be used for service location costs, such as rent for office space, printer/copier costs, and utilities for an office.

Housing Solutions Members of the underserved population experiencing homelessness should be connected to appropriate and choice-driven service options and swiftly moved into time-limited (Host Homes-only) or permanent or non-time-limited housing options. All services and housing options should be: individualized and tailored to the needs of each individual or household, trauma-informed, culturally and linguistically appropriate, and developmentally and age-appropriate.

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Back to topAll housing solution financial assistance beyond three months requires recertification of eligibility. This recertification must then be completed every three months for the duration of financial assistance. Recertification requires grantee documentation of the following:  Program participant household income below 30 percent of MFI;  The household lacks the financial resources and support networks needed to remain in existing housing without financial assistance; AND  Housing stabilization services are being appropriately implemented.

Recertification Requirement Any Financial Assistance Every three months Services/Case Management Only Every 12 months

Eligible housing solutions activities include:  Host Homes  Rapid Re-housing (including Shared Housing)  Innovative Permanent Housing Solutions  Housing-Stabilization Case Management

Host Homes Host homes is a model in which a family agrees to permit an individual or household to reside in the home with them. While staying in a host home, the individual or household are able to engage in housing stabilization services and work toward self-determined goals.

Requirements In order to be eligible, the residence must be in a community-based setting, the family may or may not be related to the individual or household, and the length of stay may or may not be time-limited.

Grantees must establish a host home screening and training process. All prospective host families must complete the screening and training process prior to hosting the individual or household in their home. The screening must include a background check, an interview with the prospective host family, and a home visit. The training must be a comprehensive training program, conducted in-person or via webinar, to orient host families to the host home program, review program requirements, and discuss expectations of the host home. The training program should also provide training on issues related to, among others:  Homelessness in your community, to include details specific to the experience of homelessness among the underserved population  Personal biases  Cultural competency  Communication and conflict resolution  LGBTQ+  Trauma and resiliency

Grantees must not make payments directly to project participants, but only to host home head of household.

Required Documentation  Grantees must have written agreements with the host family that states their willingness to house the project participant. If there are additional expectations set by the host home, this must be documented.

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Back to top  Grantees must document how household costs are determined and employ the same method for all program participants (ex. pro-rata, compare costs before and after the project participant joined the household, etc.).  Grantees must certify completion of host home screening and training process for each host family.  Monthly housing-focused case management is required. Grantees must provide the appropriate level of case management in order to ensure housing stability.

Expenses Eligible Host Home expenses include:  Host home support  Host home recruitment  Temporary housing placement (hotel or motel)  Housing stabilization services  Service location costs  Other (requires DHCD pre-approval)

Host Home Support Recognizing that the addition of another person in the home may increase costs to the family, funding may be used to subsidize the additional costs attributable to housing the project participant. Costs may include:  Food  Basic needs support  Transportation  Utilities

Host Home Recruitment Funds may be used for host home recruitment. This includes the costs of recruiting host homes, conducting background checks and host home interviews, and developing and providing the host home training program.

Temporary Housing Placement When an appropriate emergency shelter placement is unavailable, funds may be used for hotel/motel vouchers only until the desired housing placement is available. The need for temporary housing placement must be documented in the program participant’s file.

Housing Stabilization Services Funds may be used for services that are targeted to assist project participants to maintain housing. These may include critical skills related to household budgeting, money management, accessing a personal credit report, and resolving personal credit issues. If grantees elect to conduct credit checks on project participants, they must do so for all project participants so as not to violate Fair Housing Law or otherwise discriminate among project participants. Grantees may not use these funds to reimburse landlords for their costs associated with conducting credit and/or background checks. Credit may not be used to determine program eligibility. Payment of debt is an ineligible expense.

Service Location Costs Funds may be used for service location costs, such as rent for office space, printer/copier costs, and utilities for an office.

Rapid Re-housing (including Shared Housing), and Innovative Permanent Housing Solutions Funds may be used to provide tenant-based rental assistance. Innovative Permanent Housing Solutions means any permanent housing solution that does not fall within the definitions of host

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Back to tophomes or rapid re-housing (including shared housing). Examples of Innovative Permanent Housing Solutions are the use of residential care homes for older adults and master leasing units. The permanent housing solution, including any innovative permanent housing solution, must meet all of the requirements listed below.

Requirements Provision of any financial assistance should be needs-based, meaning that grantees should determine the amount of assistance based on the minimum amount needed to maintain housing stability in the near term. This will allow communities to use program resources efficiently to serve as many households as possible.

When households are moved into a new unit, the rent must meet two standards:  Rent Reasonableness – rent is equal to or less than other like units in the area, AND  Fair Market Rent (FMR) – rent (including utilities) is at or below the HUD established FMR for the unit size in the area.

Rent reasonableness means that the total rent charged for a unit must be reasonable in relation to the rents being charged during the same time period for comparable units in the private unassisted market and must not be in excess of rents being charged by the owner during the same time period for comparable non-luxury unassisted units. To make this determination, the grantee should consider (a) the location, quality, size, type, and age of the unit; and (b) any amenities, housing services, maintenance and utilities to be provided by the owner.

FMR limits include the cost of utilities. Grantees will need to utilize an established utility allowance in order to assess FMR limits for rents on units not including all utilities. The actual rent charged for a unit plus the allowance for any utilities that the program participant must pay themselves must not exceed the FMR for the area.

Grantees must not make payments directly to program participants, but only to landlords or property management companies.

Required Documentation  Initial screening  Certification form signed by the project participant stating that the project participant has received a copy of the grantee’s grievance policy  Strength-based housing barriers assessments and housing plans.  A copy of the HSNH Rent Reasonableness Worksheet and Fair Market Rents (FMR) for the area must be completed and included in the project participant file.  A copy of the completed utility allowance worksheet must be included in the project participant file. Grantees must utilize the appropriate utility allowance for any utilities that are paid by the project participant separate from rent. The grantee may use the local housing authority’s or Virginia Housing's appropriate regional allowances in order to calculate the rent standard.  Rapid re-housing financial assistance requires that the project participant head of household have a valid lease with a landlord that is in compliance with tenant/landlord laws in their name. A copy of this lease must be included in the project participant file. If grantee is master leasing, the grantee must have a sublease with the head of household. A copy of the master lease as well as a copy of the sublease must be included in the project participant file.  Monthly housing-focused case management is required. Grantees must provide the appropriate level of case management in order to ensure housing stability.

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Back to top  Grantees must have written agreements with both the project participant and the landlord that identify the terms of the rapid re-housing assistance. This should specifically provide the landlord with guidance for addressing issues which could impact housing stability and must include: o A provision requiring the owner to give the grantee a copy of any notice to the project participant to vacate the housing unit, or any complaint used under state or local law to commence an eviction action against the project participant. o The same payment due date, grace period, and late payment penalty requirements as the project participant’s lease. o The term of the rental assistance agreement for the period of time they anticipate providing assistance.

Expenses Eligible rapid re-housing (including shared housing) and innovative permanent housing solutions costs include:  Rental assistance  Rent arrears  Housing stabilization financial assistance  Housing search and placement  Housing stabilization services  Temporary housing placement  Service location costs  Other (requires DHCD pre-approval)

Rental Assistance and Rent Arrears Rental assistance is tenant-based rental assistance that can be used to allow individuals and families to obtain and remain in rental units. Funds cannot be used for mortgage assistance.

Grantees must determine the amount of rental assistance provided, such as shallow subsidies (payment of a portion of the rent), payment of 100 percent of the rent, or graduated/declining subsidies. Grantees may require a program participant to share in the costs of rent.

No program participant may receive more than 12 months of assistance.

Assistance with any portion of rent during a month counts as a month toward the 12-month limit.

Payment of rent arrears consists of a one-time payment for up to six months in arrears, including any late fees on those arrears. Rental arrears may be paid if the payment enables the program participant to obtain a housing unit.

If funds are used to pay rental arrears, arrears must be included in determining the total period of the program participant’s rental assistance, not to exceed 12 months. While the payment of rent arrears is a lump sum and recorded as such in HMIS, each month and the number of months most be noted in HMIS and counted toward the total rent assistance limit of 12 months.

Any individual or family receiving assistance beyond any arrears and two current months of rent and financial assistance must be evaluated and recertified as eligible every three months.

Assistance should be needs based, meaning that grantees should determine the amount of assistance based on the minimum amount needed to help the program participant maintain housing stability in the near term. This will allow communities to use program resources efficiently to serve as many households as possible.

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Back to topFunds may not be used to pay damage costs incurred by the tenant.

The rental assistance to move into a new unit cannot exceed the actual rental cost, which must be in compliance with HUD’s standard of rent reasonableness and be at or below Fair Market Rents (FMR) for the area.

Rental assistance or arrears to pay for a lot on which a manufactured or mobile home is located is an eligible expense as long as the household is otherwise eligible.

Housing Stabilization Financial Assistance Funds may be used to provide financial assistance to help program participants quickly access housing. The housing relocation and stabilization services financial assistance includes:  Security and utility deposits  Last month’s rent  Utility payments  Utility arrears  Moving costs  Food costs  Transportation  Application fees

Funds may be used to pay for security deposits, including utility deposits, for program participants. This is eligible in the case where the program participant is otherwise eligible and they are not receiving security or utility deposits assistance from another source. Security deposits must be paid directly to landlords or property managers.

Grantees must not take measures to recapture any deposit assistance provided to program participants. In the cases where the return of a deposit to the grantee is unavoidable, all returned deposits must be tracked as program income. Any resulting program income must be used for eligible activities.

Funds may be used for up to 12 months of utility payments for each program participant in any three-year period of time, provided that the program participant or a member of his/her household has an account in his/her name with a utility company and is not receiving assistance for the same period of time for the utilities.

Utility assistance may include up to six months of utility payments in arrears per service.

Payments of arrears must be counted toward the 12-month limit.

The grantee must use the VH or the local housing authority utility allowance guideline to set reasonable limits for utility payments.

Assistance with utilities may be structured where the program participant pays a portion of the utilities. Partial assistance payment for any month of utilities counts as a month of assistance.

Grantees may pay past due utilities; however, the past due months must be included in the 12-month limit. Utilities are limited to water/sewer, heating oil, gas, and electricity. Twelve month limits are based on assistance with one or more of the basic utilities per month. As the number of months may be difficult to determine, grantees may use estimates to determine the total number of months covered. In these cases, the grantee must document the basis for the estimation.

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Back to topFunds may be used for reasonable moving costs, such as truck rental or hiring a moving company, to assist an eligible household with housing stability.

Funds may be used for lease or apartment application fees where necessary and no other source has been identified to assist an eligible household with housing stability.

Funds may be used for emergency food to assist an eligible household with obtaining and maintaining permanent housing. Costs for food may include delivery services if no other food source is available. Documentation of connection to mainstream resources such as Supplemental Nutrition Assistance Program (SNAP) and/or local food banks should be documented in the project participants’ file.

Funds may be used for transportation to obtain and maintain permanent housing.

Transportation expenses are limited to ride share, bus passes, or other methods of public transportation.

Housing Search and Placement Housing search and placement funds may be used for services or activities designed to assist individuals or families in locating, obtaining, and retaining suitable housing. Component services or activities may include staff costs related to: tenant counseling, assisting individuals and families to understand leases, securing utilities, making moving arrangements, representative payee services concerning rent and utilities, and outreach and negotiation with property owners related to locating or retaining housing. Costs also include expenditures associated with assessing housing unit compliance with property standards, lead requirements, and rent reasonableness. Costs associated with staff in the role of housing locator would be eligible housing search and placement costs.

Housing Stabilization Services Funds may be used for services that are targeted to assist project participants to maintain housing. These may include critical skills related to household budgeting, money management, accessing a personal credit report, and resolving personal credit issues. If grantees elect to conduct credit checks on project participants, they must do so for all project participants so as not to violate Fair Housing Law or otherwise discriminate among project participants. Grantees may not use these funds to reimburse landlords for their costs associated with conducting credit and/or background checks. Credit may not be used to determine program eligibility. Payment of debt is an ineligible expense.

Temporary Housing Placement When an appropriate emergency shelter placement is unavailable, funds may be used for hotel/motel vouchers only until the desired housing placement is available. The need for temporary housing placement must be documented in the program participant’s file.

Service Location Costs Funds may be used for service location costs, such as rent for office space, printer/copier costs, and utilities for an office.

Housing Stabilization Case Management Funds may be used for housing stability and housing-focused case management. These are the costs of assessing, arranging, coordinating, and monitoring the delivery of individualized services to facilitate housing stability for project participants residing in permanent housing or to assist a project participant in overcoming immediate barriers to obtaining housing.

This assistance cannot exceed 12 months during the period the project participant is living in permanent housing.

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Back to topThese costs include:  Conducting initial assessments  Counseling  Facilitating access to mainstream services  Monitoring and evaluating project participant progress  Coordination with and referrals to other providers  Developing individualized housing and service plans  Fees for use of auxiliary aids and language services

Clients must receive housing-focused case management at least once per month.

Rapid re-housing funds can be used for housing-focused case management alone. Although rental assistance cannot be provided independent of case management, case management can be provided independent of rental assistance. For example, case management could be provided after the term of a project participant’s rental assistance expires, as long as the 12-month cap for each type of assistance is not exceeded.

“Stand alone” case management or other services may also be provided to support project participants who receive rental assistance through non-HTF – HRG funds, as long as the individual or household is eligible for HTF – HRG assistance at the time of the intake evaluation.

Permanent Supportive Housing (Housing Stabilization Services and Rental Assistance for Chronic Homeless) Permanent supportive housing (PSH) for chronic homelessness is an evidence-based housing intervention that combines decent, safe, and affordable community-based housing, non-time-limited affordable housing assistance, and wrap-around supportive services for individuals experiencing chronic homelessness. In PSH, individuals and households are ensured the rights of tenancy under state and local landlord tenant laws while being linked to voluntary and flexible supports and services designed to meet tenants’ needs and preferences. The goal of PSH is to assist individuals and households in achieving housing stability.

To be eligible, the CoC/LPG must have adopted HUD’s notice (CPD-16-11) prioritizing persons experiencing chronic homelessness and other vulnerable persons experiencing homelessness in permanent supportive housing.

Project Participant Eligibility Permanent Supportive Housing program targets individuals and families who meet the HUD definition of chronic homelessness:  Chronic homelessness: individuals and families who have been homeless and living or residing in a place not meant for human habitation, a safe haven, or in an emergency shelter continuously for at least one year or on at least four separate occasions in the last three years that total 12 months; and, have an adult head of household (or a minor head of household if no adult is present in the household) with a diagnosable substance use disorder, serious mental illness, developmental disability (as defined in Section 102 of the Developmental Disabilities Assistance and Bill of Rights Act of 2000 (42 U.S.C. 15002)), post-traumatic stress disorder, cognitive impairments resulting from a brain injury, or chronic physical illness or disability, including the co-occurrence of two or more of those conditions. For further clarification, see the HEARTH: Defining “Chronically Homeless” Final Rule.

Core Components

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Back to top  Individually tailored and flexible supportive services that are voluntary, can be accessed 24 hours a day/7 days a week, and are not a condition of ongoing tenancy;  Leases that are held by the tenants without limits on length of stay; and  Ongoing collaboration between service providers, property managers, and tenants to preserve tenancy and resolve crisis situations that may arise.

Key Outcomes and Objectives Permanent Supportive Housing projects are evaluated and monitored on how well they are achieving key project outcomes and objectives. Outcomes are measured at both the community- and project-level and include:  Households served and length of assistance  Percentage households stabilized in the permanent supportive housing project  Percentage households exited to a permanent destination (efficacy of the grantee’s Move On strategy

Requirements All programs must adhere to a housing first approach focused first on moving project participants into the permanent supportive housing project as quickly as possible and second on obtaining and maintaining housing stability. Projects must use housing stabilization support services and mainstream resources as needed to ensure housing stability.

Monthly housing-focused case management is required but participation in all program services must be voluntary. Grantees must provide the appropriate level of case management in order to ensure housing stability. All services must be designed and implemented to ensure project participants remain independently housed. All services must be individualized to meet the needs of the project participant.

Projects must strive to meet a participant to case manager ratio of no greater than 15:1 to ensure effective and appropriate provision of case management and supportive services.

Projects that are unable to meet this expectation must provide a written description of how they will ensure effective and appropriate provision of case management and supportive services, and, if applicable, how they will work toward meeting this goal in the future.

Grantees must ensure coordination with mainstream resources and community-based supports to improve housing stability of project participants. Mainstream resources are publicly funded programs that provide services, housing and income supports. They include federal, state, and local programs such as Temporary Assistance for Needy Families (TANF), Medicare, Medicaid, and Housing Choice Vouchers, that provide housing, health care, income supports, and other forms of assistance. Community-based supports include formal and informal programs and resources offered by faith-based organizations, nonprofit agencies, members of the community, and other institutions.

Grantees must establish a sustainability plan to ensure program services, including supportive services and rental assistance, are able to continue once Housing Trust Fund – Homeless Reduction Grant funding ends.

Provision of any financial assistance should be needs based, meaning that grantees should determine the amount of assistance based on the minimum amount needed to maintain housing stability in the near term. This will allow communities to use program resources efficiently to serve as many households as possible.

A program participant must be the tenant on a lease (or sublease) for an initial term of at least one year that is renewable and is terminable only for cause. Further, leases (or subleases) must

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Back to topbe renewable for a minimum term of one month. Permanent supportive housing is permanent housing with indefinite leasing or rental assistance paired with supportive services.

When households are moved into a new unit, the rent must meet two standards:  Rent Reasonableness – rent is equal to or less than other like units in the area  Fair Market Rent (FMR) – rent (including utilities) is at or below the HUD established FMR for the unit size in the area

Rent reasonableness means that the total rent charged for a unit must be reasonable in relation to the rents being charged during the same time period for comparable units in the private unassisted market and must not be in excess of rents being charged by the owner during the same time period for comparable non-luxury unassisted units. To make this determination, the grantee should consider (a) the location, quality, size, type, and age of the unit; and (b) any amenities, housing services, maintenance and utilities to be provided by the owner.

FMR limits include the cost of utilities. Grantees will need to utilize an established utility allowance in order to assess FMR limits for rents on units not including all utilities. The actual rent charged for a unit plus the allowance for any utilities that the project participant must pay themselves must not exceed the FMR for the area.

If the gross rent for the unit exceeds either the rent reasonableness standard or the FMR, grantees are prohibited from using VHSP funds for any portion of the rent, even if the household is willing and/or able to pay the difference.

Grantees must not make payments directly to project participants, but only to landlords or property management companies.

Move-On Strategies Grantees must develop and implement Moving On strategies aimed at identifying permanent supportive housing project participants who may no longer need or want the intensive services offered in PSH but continue to need assistance to maintain their housing. Moving On strategies must include partnerships between the CoC/LPG, grantee, and mainstream housing programs such as public housing, the Housing Choice Voucher program, and HUD-funded multifamily housing providers.

Termination of Assistance The grantee may terminate assistance to a project participant who violates project requirements or conditions of occupancy. Termination under this section does not bar the grantee from providing further assistance at a later date to the same individual or household.

In terminating assistance to a project participant, the grantee must provide a formal process that recognizes the rights of individuals receiving assistance under the due process of law. This process, at a minimum, must consist of:

1. Providing the project participant with a written copy of the program rules and the termination process before the participant begins to receive assistance;
2. Written notice to the project participant containing a clear statement of the reasons for termination;
3. A review of the decision, in which the project participant is given the opportunity to present written or oral objections before a person other than the person (or a subordinate of that person) who made or approved the termination decision; and
4. Prompt written notice of the final decision to the project participant.

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Back to topGrantees that are providing permanent supportive housing for chronically homeless must exercise judgment and examine all extenuating circumstances in determining when violations are serious enough to warrant termination so that a project participant's assistance is terminated only in the most severe cases.

Required Documentation  Initial screening  Documentation of referral of project participant from the CoC/LPG’s coordinated entry system to the PSH project  Strength-based housing barriers assessments and housing plans  Monthly housing-focused case management is required. Grantees must provide the appropriate level of case management in order to ensure housing stability.  Grantees must have written agreements with the project participant to identify the terms of the permanent supportive housing project. This should specifically provide guidance for addressing issues which could impact housing stability  Evidence of coordination with mainstream resources and community-based supports  Grantees must certify (at least annually) that appropriate housing stabilization services are being implemented  Permanent supportive housing rental assistance requires that the project participant head of household have a valid lease (or sublease) with a landlord that is in compliance with tenant/landlord laws in their name. A copy of this lease must be included in the project participant file. The lease must have an initial term of at least one year that is renewable and is terminable only for cause. Further, leases (or subleases) must be renewable for a minimum term of one month.  For project participants receiving rental assistance, grantees must have written agreements with both the project participant and the landlord that identify the terms of the financial assistance. This should specifically provide the landlord with guidance for addressing issues which could impact housing stability and must include: o A provision requiring the owner to give the grantee a copy of any notice to the project participant to vacate the housing unit, or any complaint used under state or local law to commence an eviction action against the project participant. o The same payment due date, grace period, and late payment penalty requirements as the project participant’s lease. o The term of the rental assistance agreement for the period of time they anticipate providing assistance.

Expenses  Housing stabilization services  Rental assistance

Housing Stabilization Services The costs of assessing, arranging, coordinating, and monitoring the delivery of individualized services to facilitate housing stability for project participants residing in permanent supportive housing.

These costs include:  Conducting initial assessments  Provision of case management and housing stabilization services  Counseling  Facilitating access to mainstream resources and community-based supports  Monitoring and evaluating project participant progress  Coordination with and referrals to other providers

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Back to top  Developing individualized housing and service plans

Rental Assistance Rental assistance is tenant-based or project-based rental assistance that may be used to enable individuals and families to obtain and remain in permanent supportive housing rental units. Funds must not be used for mortgage assistance.

Under tenant-based rental assistance, project participants select any appropriately sized unit within the CoC or LPG’s geographic service area, although grantees may restrict the location under certain circumstances to ensure the availability of the appropriate supportive services.

Under project-based rental assistance, project participants reside in a housing unit owned or leased by a grantee and the rental assistance is dedicated to that unit.

Grantees must determine the amount of rental assistance provided, such as shallow subsidies (payment of a portion of the rent), payment of 100 percent of the rent, or graduated/declining subsidies, based on the unique needs of the project participant. Grantees may require a project participant to share in the costs of rent.

Grantees must not request reimbursement for any portion of the rent paid for by the project participant under the HTF-HRG grant.

Assistance should be needs based, meaning that grantees should determine the amount of assistance based on the minimum amount needed to help the project participant maintain housing stability in the near term. This will allow communities to use program resources efficiently to serve as many households as possible.

Funds may not be used to pay damage costs incurred by the tenant.

The rental assistance to move into a new unit cannot exceed the actual rental cost, which must be in compliance with HUD’s standard of rent reasonableness and be at or below Fair Market Rents (FMR) for the area.

All project participants receiving rental assistance must be offered the appropriate housing stabilization and supportive services necessary to maintain their permanent supportive housing or engage in Move On strategies.

Administrative Costs (limited to three percent of total HTF-HRG budget) Administrative costs may include accounting for the use of grant funds, preparing reports for submission to DHCD, obtaining program audits, similar costs related to administering the grant after the award, and associated staff salaries. Administrative costs may also include staff training for program and case management, as long as this training is directly related to the provision of an emergency crisis response system.

As with all billed expenditures, billing for administrative costs must be based on actual costs incurred during a particular period.

No more than three percent of the requested funding amount may be spent on administrative costs.

While it is not necessary to detail administrative costs on reimbursements, grantees must be able to document all administrative costs and will be required to produce said documentation at the time of either on-site or desk monitorings.

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Back to topHomeless and Special Needs Housing Grants – Amendments

Amendment 1 – Fair Market Rent Requirement, Waiver In response to the continued strains to the emergency crisis response system exacerbated by, and in some instances caused by, the COVID-19 health emergency, DHCD’s Homeless and Special Needs Housing is waiving the Fair Market Rent (FMR) requirement for all grant programs utilizing state funds. All other unit eligibility requirements will remain in effect, including the Rent Reasonableness requirement.

This waiver impacts the following HSNH-administered grant programs:  Virginia Homeless Solutions Program - The FMR requirement is waived for any project participant household receiving rental assistance funded under State Rapid Rehousing or Targeted Prevention.  Housing Trust Fund – Homeless Reduction Grant – The FMR requirement is waived for any project participant household receiving rental assistance under Rapid Rehousing, Underserved Populations Innovation Project, or Permanent Supportive Housing.

This waiver does not impact project participant households receiving rental assistance under Housing Opportunities for Persons With AIDS/HIV (HOPWA) or Virginia Homeless Solutions Program – Federal Rapid Rehousing, as both utilize federal funding.

Duration: This waiver is in effect beginning July 1, 2021 and will remain in effect during the COVID-19 health emergency or until otherwise stated by the DHCD’s Homeless and Special Needs Housing.

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