The Affordable Housing Program (AHP) regulations require that all projects receiving AHP subsidies must be monitored by the Federal Home Loan Bank of Chicago (FHLB Chicago) to ensure that the project complies with the commitments made in the AHP application (and any subsequent approved modifications), FHLB Chicago policies and procedures and the AHP regulations throughout the project's retention period. AHP projects must be retained as affordable housing for five years for owner-occupied projects and fifteen years for rental projects. Semi-Annual Progress Reports Prior to completion of the project, the member and project sponsor are required to report semi-annually to the FHLB Chicago on the project's progress. The FHLB Chicago initiates this process and will send a progress report to both the member and project sponsor. The project sponsor should complete the form, sign it and forward it to the member for their review and signature. The member then forwards the report to the FHLB Chicago.   Monitoring Following Project Completion and Long Term Monitoring Following project completion, the monitoring process differs for owner-occupied projects and rental projects. Again, the FHLB Chicago will initiate this process by requesting the necessary monitoring documentation. Owner-Occupied Projects: Monitoring Following Project Completion All owner-occupied projects shall be reviewed by the FHLB Chicago. As part of the review: • The member and project sponsor are required to complete a Project Completion Report to verify compliance with commitments made in the AHP application (and any subsequent approved modifications). • The project sponsor is required to certify to the FHLB Chicago that the AHP subsidy was used for eligible purposes, households served were eligible, and services and activities were provided. • The member is required to certify to the FHLB Chicago that the project is habitable and that long term (five-year) retention documents have been properly executed and recorded. The member may be required to submit documentation confirming that the retention documents have been recorded. • The member and project sponsor may be required to submit further documentation required by the FHLB Chicago to verify compliance with commitments of the approved AHP application, FHLB Chicago policies and procedures and the AHP regulations. Owner Occupied Project: Long Term Monitoring No further monitoring is required. However: • The member will be required to notify the FHLB Chicago of any sale or refinancing of units prior to the end of the 5 year retention period and repay any unforgiven subsidy to the FHLB Chicago. This is easily achieved through the recording of a retention vehicle. • The member and project sponsor will be required to submit documentation requested by the FHLB Chicago or the Federal Housing Finance Board as part of their annual review, throughout the project's 5 year retention period. Rental Projects: Monitoring Following Project Completion All rental projects shall be reviewed by the FHLB Chicago after project completion. As part of the review: • The member, project sponsor, or owner if applicable, are required to complete a Project Completion Report to verify compliance with commitments made in the AHP application (and any subsequent approved modifications). • Member, project sponsor, or owner if applicable, may be required to submit further documentation required by the FHLB Chicago to verify compliance with commitments of the approved AHP application, FHLB Chicago policies and procedures and the AHP regulations. • The member will be required to certify that the retention documents have been recorded and the AHP subsidy was used for eligible purposes. • The owner will be required to certify to the FHLB Chicago that the project is habitable and in compliance with the income and rent commitments made in the AHP application, the AHP subsidy was used for eligible purposes, and the services and activities have been provided. • The project sponsor, or owner if applicable, will be required to submit a final Sources and Uses Statement showing final costs and final sources of funding. Sources and uses of funds must balance. If project includes commercial space, please submit separate Sources and Uses Statements for the housing and the commercial space.     • Sources and Uses Statement (.xls) • The project sponsor, or owner if applicable, will be required to submit a final Development Budget detailing total project costs and sources of financing (including terms, rates and amortization) to confirm that project costs are reasonable. If project includes commercial space, please submit separate development budgets for the housing and the commercial space.     • Sample Development Budget (.xls) • The project sponsor, or owner if applicable, will be required to submit a final 15 Year Operating Proforma detailing both income and expenses to confirm that operating costs are reasonable and that the project is financially feasible for the full 15 year retention period. The operating proforma should include:     • Gross Rent     • Other income separated from rental income (laundry, parking, etc.).     • Vacancy/Loss     • Detailed Operating Expenses     • Replacement Reserves     • Debt Coverage Ratio     • Inflation Assumptions If the project includes on-site residential services, such as meals, tenant counseling, case management, etc., please submit separate operating budgets, including income and expenses, for housing and services. • The project sponsor, or owner if applicable, will be required to submit documentation to validate the project's total development costs. • The project sponsor, or owner if applicable, will be required to submit a Tenant Income Worksheet listing the current occupants of the building. The information provided on the worksheet allows the FHLB Chicago to confirm that rents are affordable and that current tenants are eligible for the AHP subsidy and meet the commitments made in the AHP application. Please review the Tenant Income Worksheet Definitions for help with completing the Tenant Income Worksheet. • Tenant Income Worksheet & Definitions (.xls) Rental Projects: Long Term Monitoring • The project owner will be required to certify annually to the FHLB Chicago that the project is in compliance with rent and income targeting commitments made in the AHP application and to the project habitability • The member will be required to certify to the FHLB Chicago every five years that the project appears to be suitable for occupancy based upon an exterior visual inspection. • The project sponsor, or owner if applicable, will be required to submit a Tenant Income Worksheet listing the current occupants of the building and income documentation for a sample of current tenants every five years. The information provided on the worksheet allows the FHLB Chicago to confirm that rents continue to be affordable and that the current tenants meet the commitments made in the AHP application. Please review the Tenant Income Worksheet Definitions for help with completing the Tenant Income Worksheet.     • Tenant Income Worksheet & Definitions (.xls) The FHLB Chicago uses median income guidelines published annually by the Department of Housing and Urban Development (HUD) to determine income eligibility. • Projects receiving over $500,000 in AHP subsidy, where the subsidy represents 40% or more of the total sources, will have an onsite visit every three years. The project sponsor, or owner if applicable, will be required to have a representative present during the site visit to answer any questions. • The member and project sponsor, or owner if applicable, will also be required to submit documentation required by the FHLB Chicago or the Federal Housing Finance Board as part of their annual review throughout the project's retention period.