As the state participating jurisdiction (PJ), Kentucky Housing Corporation (KHC) awards the special designation of Community Housing Development Organization (CHDO) to select nonprofit housing agencies that have an existing partnership with KHC and a proven record of producing HOME-funded, CHDO-eligible affordable housing projects in their service area. These organizations may be invited by KHC to apply for designation as a CHDO, if KHC has determined that a need exists for a CHDO in the organization's service area.
Note: Applications for CHDO designation will not be accepted without invitation.
A CHDO is a nonprofit, community-based service organization that has significant capacity to develop affordable housing for the community it serves. To be eligible, a nonprofit must:
- Be legally organized under state and local law and maintain a record of good standing with the Kentucky Secretary of State's office.
- Have its 501(c) tax-exempt determination from the Internal Revenue Service.
- State a written commitment to providing decent, affordable housing to low- and moderate-income persons in its articles of incorporation or bylaws.
- Have a clearly defined service area outlined in its articles or bylaws.
- Organize its board of directors to contain no more than one-third representation from the public sector and a minimum of one-third representation from the low-income community.
- Demonstrate that the organization is not controlled, nor receives direction from, individuals or entities seeking profit from or who will derive direct benefit from the organization, as evidenced by its bylaws.
- Have no part of their net earnings benefiting any member, founder, individual, or contributor.
- Provide in its bylaws, a formal process for low-income program beneficiaries and low-income residents of its service area to advise the organization in all of its decisions regarding the design, location, development and management of affordable housing projects.
- Employ at least one paid, full-time housing production staff person.
- Maintain a staffed, physical office location in the proposed service area that is open for business and accessible by potential program applicants during customary business hours.
- Be able to demonstrate the capacity of their key staff and board of directors to carry out CHDO-eligible, HOME-assisted projects in the community where it intends to develop affordable housing (key staff and board of directors have successfully completed HOME-funded, CHDO-eligible projects in the past).
- Demonstrate that it has at least one year of relative experience serving the area where it intends to develop affordable housing.
- Have established a minimum five-year strategic business plan, which must include CHDO-related production and community involvement goals.
- Meet the financial accountability standards as outlined in 24 CFR 84.21, "Standards for Financial Management Systems."
- Maintain a history of no significant compliance findings on its KHC-funded projects.
KHC may grant exceptions to non-regulatory requirements on a case-by-case basis.
The above list is not intended to be all-inclusive, and KHC may require additional information prior to making a determination for CHDO designation. Meeting the above requirements does not guarantee that the organization will be granted CHDO designation by KHC. KHC reserves the right to deny or revoke CHDO designation based upon its evaluation of the nonprofit organization's performance. Designated CHDOs will be evaluated periodically for production and other benchmarks as established by KHC.
Resources
For information on CHDO eligibility and requirements, please visit the HUD website training module on How To Become a CHDO. For resources related to your Kentucky Housing Corporation CHDO project, please visit the Housing Contract Administration Help Desk.