$20 Million Slated to Help Convert Multifamily Projects into Assisted Living Facilities

September 23, 2009
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HUD announced the availability of $20 million to help convert multifamily projects into assisted living facilities for low-income seniors. The funding is being offered through HUD’s “Assisted Living Conversation Program” (ALCP).

Private nonprofit owners of eligible multifamily assisted housing developments specified in section 683(2)(B), (C), (D), (E), (F), and (G) of the Housing and Community Development Act of 1992 may apply for an ALCP grant. This includes projects that are a Section 202 with or without Section 8 rental assistance; Section 202 PRAC; Section 8 project-based rental assistance; projects subsidized with Section 221(d)(3) below-market interest mortgage; projects assisted under Section 236 of the National Housing Act; or Section 515 rural housing projects receiving Section 8 rental assistance. In addition, the projects must be in occupancy for at least five years from the date on the HUD-approved form HUD-92485 (Permission to Occupy Project Mortgage).

Ineligible applicants include: owners of developments designed specifically for people with disabilities; owners of Section 232 developments; property management companies and agents of property management companies; limited dividend partnerships; nonprofit public agencies; owners of hospitals or other health-related facilities; owners of an existing insured or privately owned assisted living facility; and owners of commercial structures.

Applications must include a firm commitment for the supportive services to be offered within the ALF. That means the ALCP grant money must be used for the physical costs of converting some or all of the units in a multifamily development into an assisted living facility (ALF), including unit configuration and related common and services space and any necessary remodeling, consistent with HUD or the state’s statutes (whichever is more stringent). HUD warns that there must be enough common space in the community to allow for the addition of a central kitchen or dining facility, lounges, recreation, and other multiple areas available to all residents of the project, and office/staff spaces in the ALF. When food is prepared at an off-site location, the preparation area of the facility must be of sufficient size to allow for the installation of a full kitchen, if necessary.

PRACTICAL POINTER: Conversion changes may include upgrading ALF units with moveable cabinetry, accessible appliances, sinks, bathrooms, and kitchen fixtures, as well as grab bars and widening of doors; elevator upgrades; lighting upgrades; sprinkler systems; emergency alert systems; medication storage and workstations.

Owners will be responsible for ensuring that all converted units meet local standards, codes and regulations governing assisted living facilities. The projects must also be licensed and regulated by the appropriate governing body.

In addition, the developments receiving funding will be asked to provide resident services through a number of sources, including their state home health care programs, state assisted living service funds, congregate housing services program funds, service coordinator funds, and other private grants and donations. Since the funds awarded under the ALCP do not cover the costs of these services, the project owners must also be able to provide supportive services for the residents either directly or through a third party.

Owners will be permitted to charge assisted living residents for meals and other service fees. And, residents will be allowed to contract directly with third-party agencies for nursing, therapy, or other services not offered by the ALF.

Applications, which are due November 5, can be downloaded from HUD’s Web site at www.hud.gov/offices/adm/grants/nofa09/grpalcp.cfm.