Capacity Building for Existing and New Organizations

This initiative is aimed at developing the capacity at the local and tribal level to assist existing community organizations to carry out new functions and/or more effectively perform existing functions and the creation of new organizations or institutions to carry out specific functions. Activities in connection with existing organizations include a broad range of assistance aimed at building administrative, program, and management capabilities of local rural nonprofits, Community Development Corporations (CDCs), Indian tribes, and local affiliates of national nonprofits engaged in housing and economic development.

Building capacity of new organizations is intended to encompass the various aspects of assistance needed to develop access to new or existing funding resources; and/or create (but not capitalize) financing mechanisms such as private community development financial institutions (CDFIs) using lines of credit, revolving loan funds, and Federal or State funding not currently available to the area.

Innovative Housing and Economic Development Funding

The innovative initiative is intended to support, but not be limited to, "hard costs" for both housing and economic development in specified local areas. Eligible activities include all aspects of land acquisition; housing and business development; capitalizing financing vehicles such as CDFIs, lines of credit, revolving loan funds, etc; and providing direct assistance to homeowners/businesses/developers through loans, grants, or securitization mechanisms. Eligible applicants include Indian tribes, State housing finance agencies, local rural nonprofits, and CDCs presently engaged in housing and economic development activities in rural areas.

Seed Support

Seed support funding is intended to provide assistance for startup costs, either for new organizations/institutions or for specific projects new to the eligible area or new to the organizations that will support innovative housing and economic development activities. For organizations, this could include "upfront" money for acquiring space and support facilities as well as startup administrative costs. For both housing and economic development projects, eligible activities would include upfront hard and administrative costs. Eligible applicants are Indian tribes, local rural nonprofits, and CDCs that are located in areas that have limited capacity for development.

Application Review Process

RHED applications are reviewed and scored for their response to the five factors stipulated in HUD's Super Notice of Funding Availability (NOFA) and expanded to meet the requirements of the RHED program. A brief summary of those requirements are as follows:

• Rating Factor 1 - Capacity of the Applicant and Relevant Organizational Experience (up to 25 points)
  This factor addresses the qualifications and experience of the applicant and participating parties to carry out the objectives of the proposed activities within a reasonable period of time. The applicant must submit evidence of their experience and their partners (if any) in leveraging other Federal, local, State, and private-sector funds. For the capacity initiative, the major consideration is the competencies of "core staff," of the organization, or its parent, to effectively utilize the funds being proposed. For Innovative Activities, the focus is on demonstrated experience and competencies of the organization or its partners in carrying out the type of housing or economic development project or activity for which funding is being sought. Seed Support emphasizes experience of "core staff," partners, or parent organizations and competencies to undertake a startup project or activity.

• Rating Factor 2 - Need and Extent of the Problem (up to 25 points)
  The RHED program is designed to address the problems of rural poverty, inadequate housing, and lack of economic opportunity. Need will be considered in two ways - (1) documentation of the demographics of economic distress, i.e., poverty rates, unemployment data, out-migration information, crime rates, percentages of persons on public assistance, vacancy rates, and incidence of homelessness; (2) demonstrated need for the specific project or activity. Because of distances between population centers, considerable latitude is given to establishing the most appropriate area for the statistics. However, such statistics must be compared with those of the county or State in which the project or activity is located. A special need factor, weighting up to 5 points, is given for certain projects or activities that are targeting underserved populations: Areas with populations under 2,500, migrant and seasonal farmworkers, Indian tribes, colonias, and communities in Appalachia and in the Mississippi Delta.

• Rating Factor 3 - Soundness of Approach (up to 30 points)
  Soundness of approach addresses the quality and anticipated effectiveness of the applicant's Statement of Work in meeting the needs identified in Rating Factor 2. HUD will evaluate the Statement of Work for the proposed activities, reasonableness of costs, and management plan for assuring timely completion. The strength of the Statement of Work will be determined by how well the management plan meets the intent of the NOFA, is logical and feasible, and provides a schedule for completion of all tasks.

• Rating Factor 4 - Leveraging Resources (up to 10 points)
  HUD will evaluate the extent to which applicants for any of the three initiatives have obtained firm commitments of resources from other Federal, State, local, and private sources. In awarding up to 5 points for this criterion, resources in the form of cash or in-kind services outside the applicant's organization or affiliation that support the activities will be considered.

  Innovative projects or activities that specifically propose to expand lending opportunities by developing diversified financial leveraging linkages to mitigate the risk of lending through the pooling of much larger funds from other funding sources (e.g., private institutions and foundations) will be awarded (up to 5 additional points).

• Rating Factor 5 - Comprehensiveness and Coordination (10 points)
  The extent to which an applicant's proposed program is coordinated with other ongoing and related activities, agencies, and organizations within the area is evaluated to ascertain that the applicant is not operating in isolation. In this evaluation, HUD will consider the organization's participation in the State's Consolidated Planning process and/or the extent to which the application's management plan supports such strategies.

• Special Points for Rural Empowerment Zones and Communities (2)
  Applicants that provide evidence that their project or activity is located in a USDA-designated Rural Empowerment Zone or Enterprise Community and their management plan supports the Zone's or Community's strategic plan, will be eligible for the special 2 points.

Updated 8/18/2011

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