Preparing Applications for Funding

What are the typical components of a Notice of Funding Availability (NOFA) or a Request for Proposal (RFP) response?

Typical NOFA and RFP components include:

• Preapplication meeting with OH staff.
• A proposal narrative comprised of responses to questions proposed by OH.
• Budget workbook, submitted on a Spreadsheet form provided by OH.
• Model documents for preserving lasting affordability; typically, a ground lease or a deed restriction that include the resale limitations.
• Evidence of site control – either a deed, if you already own the land, or a purchase and sale agreement with feasibility timelines that account for assembling funding.
• Construction drawings prepared by an architect, including a site plan and floor plans.
• A Gantt Chart or other visual representation of the developer’s projects currently in development.
• Development team member resumes.
• Current fiscal year’s financial statements (balance sheet, profit, and loss statement).
• Audited financial statements from the past three fiscal years.
• Depending on the legal structure of the proposed development, a 1) Homeowners/ or Condominium Owners Addendum with a corresponding budget for the homeowners/condominium owner’s association, or 2) a Limited Equity Co-operative Addendum with a corresponding budget for the co-op and a market study demonstrating demand for the co-op may be required.
• Board Resolution or similar document approving the submission of the NOFA or RFP response.
• Development consultant or partnership agreements, if applicable.
• Letters of Interest (LOIs) from construction lenders, if applicable.

What can I do now to prepare to respond to a NOFA or an RFP?

Two key technical tasks associated with any successful NOFA or RFP response are:

• Familiarize yourself with the principals of affordable home pricing, and either create a partnership with an existing stewardship organization or decide on an effective resale formula and develop the accompanying legal documents by which ongoing affordability will be secured. We recommend participation in training offered by the Grounded Solutions Network to learn more about the creation and stewardship of resale-restricted homes.
• Prepare a balanced draft development budget that includes affordable homes prices, calculated to be affordable according to best pricing practices, and complete a sample budget workbook. The budget should show you have a good understanding of all the costs typically involved with new construction and demonstrate that you have enough construction and takeout (permanent) sources to cover those costs.

OH also recommends consulting with an attorney experienced in permanently affordable homeownership; identifying the architect who will prepare your construction drawings; reviewing the questions asked in prior NOFA and RFP proposal narratives; gathering materials available in advance, such as development team resumes; and drafting templates that can be prepared in advance, such as the template for your organization’s board resolution. If your organization is new and does not yet have three years of audited financial statements, begin having annual audits and identify a partner for your applicant team who does have three years of audited financial statements. Learn about other financial resources that might be needed to help your project pencil, such as the Housing Trust Fund administered by the Washington State Department of Commerce.

I’ve decided to apply for funding. What should I expect at a preapplication meeting? What will be expected of me?

Applicants should be able to present a preliminary site plan prepared by an architect and be prepared to field questions about the site plan, present a rough development and takeout budget that pencils, and describe the details of the proposal. Key partnerships should be presented, including the plan for long-term oversight of the homes to ensure they are sold at affordable prices to low and moderate-income buyers for at least 50 years.