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Using HOME

Home Acquisition and New Construction
Reno, Nevada

The Housing Authority of the City of Reno, Nevada, has used HOME funds aggressively to meet a variety of housing needs since they first became available in 1992. In that year, the authority borrowed $300,000 of the city's $850,000 HOME allocation to help fund the purchase and rehabilitation of Sarrazin Arms, a 59-unit rental development near downtown.

The HOME loan has a 3 percent interest rate and a 20-year term, with interest-only payments for the first 6 years. Because the HOME funds make up only a portion of the $1.65 million total project cost, only 20 of the studio units are designated as HOME funded. However, through favorable financing, the authority has been able to keep the rents on all units at the affordable level required by the HOME program.

In 1993, the housing authority used $100,000 of the city's HOME funds to help finance the purchase of a 10-unit complex from the Resolution Trust Corporation. The total purchase price was $185,000; the remainder of the financing was provided by a local bank at below-market terms. The 8 one-bedroom and 2 two-bedroom units are now occupied by low-income families.

The Reno Housing Authority also operates in the adjacent city of Sparks, Nevada, where the need for affordable homeownership opportunities is a priority. To help meet that need, in 1993 and 1994, the housing authority successfully applied for $222,000 in HOME funds from the State of Nevada. The authority used the funds to help acquire 11 single-family properties in Sparks, which were then sold to eligible low-income families.

The housing authority has also undertaken HOME-funded projects in partnership with Community Housing Development Organizations (CHDO) and other nonprofit organizations. In 1993, the authority helped the Northern Nevada Community Housing Resource Board (CHRB), an existing organization, to become a certified CHDO, eligible to compete for a set-aside of HOME funds. The CHRB received $252,000 in local HOME funds to acquire Joseph's Inn, a 29-unit downtown motel, and rehabilitate it for single-room occupancy (SRO) housing for single homeless persons. Through the housing authority's ongoing involvement, the project also received funding under the Section 8 SRO Moderate Rehab Program. The total project cost was $670,000.

In another partnership with a nonprofit organization, the housing authority is building Silver Sage Court, 16 units for elderly and handicapped persons scheduled for completion in August 1996. The authority originally acquired the site for new public housing development, for which only part of the site was ultimately needed. The authority and its nonprofit partner decided to build special needs units on the remaining land, using approximately $315,000 in local HOME funds as gap financing on the $800,000 project.

In another new construction effort, the Reno Housing Authority plans to use a variety of funding sources, including $260,000 in HOME funds, to build housing for large families on a site it owns next to an existing public housing development. The 30 three- and four-bedroom units will be completed in early 1997. The total development cost will be approximately $2.7 million, which will include, in addition to the HOME funds, more than $1.25 million in low-income housing tax credits from the State of Nevada and $150,000 in state housing trust funds.

The Reno Housing Authority clearly saw the potential for using HOME funds to respond to housing needs that could not be met through its existing funding sources. As an established community institution with development and management expertise, the authority has been able to successfully compete for and use HOME and other funds to provide housing for the homeless, the elderly and disabled, large families, and households moving to homeownership. In the process, the authority has broadened its role as a housing provider and strengthened its partnerships with other public and nonprofit agencies.

Contact: David C. Morton, Executive Director, Housing Authority of the City of Reno, 702/329-3630

Copyright 1997 - 1998 - 1999 - 2000
Affordable Housing and HOME
National Association of Housing and Redevelopment Officials (NAHRO)
630 Eye Street, NW
Washington, DC 20001-3736
Telephone: (202) 289-3500
Fax: (202) 289-4949