The Kansas Housing Resources Corporation has awarded Lincoln County a Moderate-Income Housing (MIH) program grant in the amount of $150,000 to develop affordable housing units. The goal will be to convert up to five (5) chronically vacant houses into viable and occupiable houses. By reinvesting in these long-vacant houses at a time when housing demand is high, the program will create new opportunities for families looking to move into the county or grow into a larger home, remove nuisances creating more attractive neighborhoods and communities, and boost property valuations generating new revenue for local government, schools, and services.
MIH grant funds can be used for down-payment assistance for the purchase and/or substantial rehabilitation of chronically vacant houses. Grant funds are up to 25% of the overall project cost with a maximum grant of $30,000. The Lincoln County Economic Development Foundation (LCEDF) is serving as grant administrator and coordinator for the program.
- Houses targeted for MIH funding must meet the following criteria:
- Have been vacant for at least five (5) years OR become vacant more recently but has a significant issue(s) that will likely result in the house remaining vacant if the issue(s) isn’t rectified.
- Are 3 bedroom/2 bathroom to meet current housing demands OR will be after rehabilitation.
- Must be located in Lincoln County.
- Must not be located within the pending floodplain being drafted by FEMA or mitigation must occur to protect the property from flooding. (https://gis2.kda.ks.gov/gis/lower_solomon_saline/)
- End use must be an owner- or renter-occupied house. Seasonal residences, Airbnb’s or short-term rentals are not eligible.
- Individuals who apply for MIH funding must meet the following criteria:
- Meet moderate income qualifications (outlined in the chart at this link) if they intend to live in the house. If the house is to be a rental, the renters must meet moderate income qualifications. Income criteria may be updated/adjusted by HUD in the near future.
- Have recently purchased the proposed house OR have a contract to purchase the proposed house. (Contract can be contingent upon MIH grant approval.) Property owners who have owned the proposed house for a long period of time and bear significant responsibility for the house being chronically vacant and/or falling into a state of disrepair will not be considered for the program.
- Be current on all property taxes and utilities on all properties owned within Lincoln County.
Other Grant Requirements
Funding for this program is through the Kansas Housing Resources Corporation (KHRC). Due to state funding and other local priorities, the grant also requires the following:
- Project must be complete within one (1) year of either closing on the purchase of the house or being approved for the MIH grant program.
- Project results in the substantial rehabilitation of the house with a minimum investment of $50,000 in the house that increases the property’s appraised value by at least 20%.
- A housing inspection must be completed after the project has been completed to ensure the rehabilitation results in a house that meets the KHRC’s Uniform Physical Condition Standards for Single Family Housing Rehabilitation. There must be no outstanding issues reported in the inspection. The North Central Regional Planning Commission (NCRPC) will complete all housing inspections.
- A deed restriction filed with the Lincoln County Register of Deeds office limiting the profit that can be achieved if the property is sold within a five (5) year period after project completion. The property owner must agree the restriction shall require a declining refund of any grant funds in increments of ten percent (10%) bi-annually. At the end of the fifth year of ownership, the deed restriction shall be lifted and there shall be no restriction on the profit achieved by the sale of the property.
- For renter-occupied houses:
- Upon project completion and over the course of a five (5) year period, any new tenants must meet MIH income qualifications prior to moving into the rental house. Income verification documentation must be provided to the LCEDF for review and approval. At the end of the fifth year, there will be no further income qualifications for tenants.
- Upon project completion and over the course of a five (5) year period, when a vacancy occurs the rental house must be publicly advertised as being available for rent.
- There must be a signed lease between the property owner and all tenants stating the rent amount, date rent is due, security deposit and pet fee requirements, charges for late payments, timeline for lease renewal, and other relevant details. Property owner must provide the LCEDF a copy of the signed lease.
- Grant funds will be a reimbursement of project costs after paid receipts have been submitted as proof of expenses. No reimbursement will be more than 25% of expenses. The overall reimbursement will not exceed $30,000.
- Ineligible expenses that will not be reimbursed by grant funds include: costs incurred prior to MIH grant approval, the applicant’s/property owner’s own labor (sweat equity), landscaping, repairs to outbuildings and detached garages (or other improvements that are not directly associated with the house), furniture, and appliances.
As a new program, the Moderate Income Housing Grant program application process is expected to be the following (check the full program guidelines and application for all details):
1) Submit an MIH application to the LCEDF office.
2) Application review and approval process.
3) Upon approval submit all MIH required documents within 30-60 days. The required documents may vary depending on the individual project.
4) Upon submission and approval of all documents, project begins.
5) Upon project completion (within 1 year), submit additional required documents for project close-out.
All projects will be scored based on the following criteria:
1) Level of critical repairs needed to the house
2) Community impact and visibility of the house
3) Financial feasibility/viability of rehabilitation
4) Project readiness, anticipated start and completion dates
5) Economic development impact
Lincoln County has been awarded $150,000 in Moderate Income Housing grant funds. Of those funds, $30,000 has been set aside for the relocation and rehabilitation of the ‘free’ house at 602 N 2nd Street in Lincoln if an MIH qualified buyer is found. If there is high demand for MIH funds, the LCEDF will work to try and secure additional funding to expand the program and fund more projects.
If you have questions on the Moderate Income Housing Program guidelines, application or process, please contact Kelly Gourley, Director of the Lincoln County Economic Development Foundation, at 785-524-8954, by email: [email protected], or stop by the office in the basement of the county courthouse at 216 E. Lincoln Avenue, Lincoln, KS 67455.
The Lincoln County Economic Development Foundation is an equal opportunity provider, employer and lender.