OHFA Annual Plan - Ohio Housing Finance Agency

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Rural and Appalachian RegionsBackground DataOhio is the seventh most populated state but ranks fifth in the number of rural residents.The rural population of Ohio accounts for over 22 percent of the state’s total populationaccording to 2000 Census data. Living in a rural area is a lifestyle choice for someand a necessity for others, and is notably different than urban areas. The percent ofhomeownership is higher in rural areas with 85.1 percent versus 65.6 percent for urbanareas. In order to raise a family in the rural area or care for older family members, manyfamilies are forced to commute further to work and services. Over 41 percent of ruralresidents work outside of the county of their residence as compared to 25 percent in urbanareas.Living in the rural area is becoming more difficult as the cost of transportation increases,percentage of persons in poverty rises, and unemployment rates climb. As the shift inthe Ohio economy has gone from industrial to information technology the rural area hassuffered. Of the five highest unemployment counties, four are located in the Appalachianregion of Ohio. Whereas Ohio residents living in the large urban cities the unemploymentrate is lower and jobs are in close proximity eliminating the need for a long commute.SynopsisAppalachia is defined as a 200,000-square-mile region that follows the spine of theAppalachian Mountains from southern New York to northern Mississippi. In Ohio, Appalachiaencompasses 29 counties in the southern and eastern parts of the state. Rural Ohio isdefined as villages of less than 2,500 residents or in the open country. Collectively these twoareas account for nearly 25 percent of the state’s population.Both areas lack access to affordable housing. In Rural Ohio, there is a lack of existingpublic infrastructure upon which to build an economic base which could then supportaffordable housing. Appalachian Ohio has additional constraints: the lack of suitable terrainto build quality housing and inconsistent rules and regulations. Further exacerbating theseconditions are historical practices of these areas not receiving adequate rehabilitation dollarsresulting in a large amount of existing substandard housing stock.There are numerous reasons for the lack of decent, safe, and affordable housing in rural andAppalachian areas, the following reasons were identified:• The existing housing stock in rural areas are deteriorating and in desperate need ofrehabilitation resulting in “housing of last resort” stock• Additional development costs are incurred to build in rural and Appalachian areas costsare passed on to renters with already limited incomes• Many rural residents cannot meet the underwriting criteria for homeownershipopportunities• Suitable building sites are more difficult to find• Cost of construction often exceeds the appraised value for single family homes• HUD’s income limits use statistics that are influenced by adjacent MSA’s or those inanother state and are stagnant in most rural areas• Lack of financial education has resulted in deteriorating credit• Some rural counties are affected by large cities with a good but limited employmentbase24
• Job opportunities in rural areas are few• A large uncounted homeless population exists• Lack of support for Community Housing Development Organizations (CHDOs) in ruralareas• Services for special needs, case management, and supportive services are limited inrural communities• The shift of federal programs from a direct loan program with subsidy to a guaranteedloan program does not serve the same clientele• Rural areas of Ohio are suffering with large increases in foreclosures and vacant homesSeveral programs attempt to address the housing needs in Appalachian and rural areas inOhio. Specifically the Low Income Housing Tax Credit program, administered by the OhioHousing Finance Agency, works fairly well but doesn’t meet the full needs of affordablehousing in rural areas. The USDA Rural Development Section 502 Direct program providesa deep subsidy for rural homebuyers but the funds are limited and due to budget coststhey may be reduced. Financing offered by ODOD and OHFA for development, homeimprovements, down payment assistance, and counseling has also been very helpful in therural areas. In 2007, the Ohio Department of Development also identified 25 distressedOhio counties that are priority investment areas and are eligible for priority financing forsome economic development programs. Of the 25 counties identified, 22 are located in theOhio Appalachian region. Recommendations were formed to further address the uniquechallenges in Appalachian and Rural Ohio and to promote affordable housing in these areas.Recommendations1. Priority to Communities that have Infrastructure in PlaceWith such limited resources available, state programs should give priority to communitiesthat have infrastructure in place. It is less costly to adapt/reuse or tear down and rebuildwhere you have existing infrastructure.2. Qualified Allocation Plan (QAP) priority to Rural Development Section 515Ohio Housing Finance Agency’s (OHFA) Qualified Allocation Plan should give priority to theSection 515 funds from Rural Development. There are limited Section 515 funds and theyneed the leverage of tax credits to be most successful.3. Increased Preservation EffortsMore priority and funding needs to be given to preservation of rental units in the rural area.The single family homes may not be feasible to save but apartment complexes, especiallythose with tenant subsidy need to be preserved as they cannot be replaced.4. Interest Rate Assistance as Bridge to HomeownershipDown payment assistance grants take care of the equity requirement on the front endfor home purchase but not the long term affordability. For those who are ready forhomeownership, interest rate assistance is needed as a bridge.5. Consistency and/or Consideration for Septic System CostsDevelopment of individual septic systems in the rural areas can be very costly. The cost forrequired systems in some counties makes home development cost prohibitive. There needsto be requirements from the state level for local health departments to have consistency inthe development of individual sewer systems. If consistency is not obtained, OHFA shouldbe flexible in administering programs to account for the added costs.25
Page 3 and 4: OHFA Annual PlanThe Ohio Housing Fi
Page 5: Mission StatementsThe OHFA Annual P
Page 8 and 9: The State’s Housing NeedsAffordab
Page 10 and 11: Subject Matter Expert (SME) Workgro
Page 12 and 13: 3. Financial LiteracyOHFA and other
Page 14 and 15: Affordable Housing Preservation & D
Page 16 and 17: federal subsidies. To achieve this
Page 18 and 19: Accessible HousingBackground DataOh
Page 20 and 21: 3) Create dedicated funding streams
Page 22 and 23: • Recommend that Ohio support the
Page 26 and 27: 6. Annual Set-Asides and Incentives
Page 28 and 29: • Several cities in Ohio current
Page 30 and 31: OHFA should provide funding, traini
Page 32 and 33: Permanent Supportive Housing Produc
Page 34 and 35: 3. The State should assist local Co
Page 45 and 46: PrioritizationThe challenge of prio
Page 47 and 48: Agency RecommendationsThe Annual Pl
Page 49 and 50: APPENDIXWorkgroup 1: Affordable Hom
Page 51 and 52: Executive SummaryHousing Need Descr
Page 53 and 54: efficiency and resource conservatio
Page 55 and 56: 554. Home Buyer Education in OHFA F
Page 57 and 58: Estimated Units in Need of Some For
Page 59 and 60: Ohio County Foreclosure Filings (19
Page 61 and 62: Operating Costs - Met and Unmet Nee
Page 63 and 64: Workgroup #2:Affordable Housing Pre
Page 65 and 66: Secondary Recommendations• Explor
Page 67 and 68: Executive SummaryOhio’s supply of
Page 69 and 70: Met Housing Needs (“Resource Inve
Page 71 and 72: Ohio Deptof MentalRetardation andDe
Page 73 and 74: Unmet Housing NeedsData OverviewThe
Page 75 and 76:
ody, and will be built within the C
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• OHFA will continue to maintain
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Best Practices, Policies and Progra
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addition, 60,111 one-person househo
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Across Ohio, people with very low i
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• Responsible for Rent - The pers
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Seattle, St. Louis, and Washington,
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Primary Recommendations• Create a
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Unmet Housing Needs:• Due to the
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• The cost of construction often
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Recommendations for Annual Plan Adv
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capacity to quantify vacant propert
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distributed on or about January 15,
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Action is needed at the State level
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a “user-friendly” data system,
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5) Incentivize the formation of bro
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Workgroup #8:Permanent Supportive H
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3. Assist local Continuums of Care
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Program and Resource InventoryNonpr
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Table 2PopulationsPersons whoexperi
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Examples: A national model for succ
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oles, so they create a contract bet
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Workgroup #8:Appendix ANameProgramD
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or remedyingneglect, abuse,or the e
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ased healthcare, and earlyintervent
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“Bob” of Stark County, OhioPubl
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OHFA Annual Plan - Ohio Housing Finance Agency

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