26-PLA07 QA.pdf
PDF 312 KB Posted
- Attached to
- DEVELOPMENT OF AFFORDABLE HOMES
- Solicitation number
- 26-PLA07
- Issued by
- Dane County, Wisconsin
About this file
This is a Questions and Answers document for RFP #26-PLA07 issued by the City of Sun Prairie Planning Department in Wisconsin for the Development of Affordable Owner-Occupied Homes Program. The RFP solicits proposals for new construction or acquisition/rehabilitation of affordable housing units targeting households at 80% Area Median Income or below, with completed projects and homeownership dwellings transferred to owner-occupied status within nine months of construction completion. Virtual Question and Answer sessions were held on March 26, 2026, at 2:00 PM CST and March 31, 2026, at 10:00 AM CST via Microsoft Teams, with responses posted by April 3, 2026. Proposals were due electronically to purchase@cityofsunprairie.com by Friday, April 10, 2026, at 2:00 PM CST. The contract term runs from June 1, 2026, through April 30, 2028, with an option to extend for one additional year upon mutual agreement.
The City has $600,000 available in 2026 for this program, offering maximum funding of $200,000 per owner-occupied unit as 0% interest, long-term deferred loans in second position to primary mortgages, with a total financing-to-value ratio not exceeding 115% (or 125% for community land trust projects). Applicants must contribute a minimum 5% equity contribution through ownership equity or deferred development fees. At least 75% of City funds must be directed to capital costs, with up to 25% supporting soft costs including developer fees capped at 10% of the total award. Valuation is determined by fee simple appraisal completed by the developer's lender. For projects offering permanent affordability through 99-year Land Use Restriction Agreements, up to 50% of the total loan is eligible for forgiveness at first homebuyer sale. Projects without permanent affordability require the mortgage assistance loan to be repaid to the City when the homeowner sells the property or transfers ownership. Soft costs include architectural and engineering services, permit fees, legal fees, recording fees, and similar non-construction-related expenses.
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Other files
| File | Type | Posted |
|---|---|---|
| 26-PLA07 DRAFT CONTRACT.PDF | ||
| 26-PLA07 Development of Affordable OO Homes.pdf | ||
| Attachment A - OO Dev Program Combined.pdf | ||
| 26-PLA07 FORM A.PDF | ||
| Development of New OO Housing_App_02112026.docx | DOCX document | |
| Development of Affordable OO Homes Loan Program QA.pptx | PPTX presentation | |
| 26-PLA07 FORM B.PDF | ||
| 26-PLA07 FORM E.PDF | ||
| Appendix B - Budget Workbook - Development 02112026.xlsx | XLSX spreadsheet |
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Text version
RFP 26-PLA07
Development of Affordable Owner-Occupied Homes Program
Questions and Answers
1. The RFP mentions valuation, what will that be determined by?
The valuation will be determined by the fee simple appraisal completed by the developer’s lender (the bank involved in financing the project).
2. Can you confirm how the funding would flow for the project with permanent affordability secured through a LURA? Example:
- Let's say the total development cost is $400,000 and the city is providing $200,000 with $100,000 as a grant and $100,000 as a loan.
- At the time of sale to the homebuyer, the $100,000 grant is instantly granted since it is a grant.
- The $100,000 loan is transferred to the land trust and is recorded against the land.
- If the house AND land are ever sold (basically if the land trust ever gives up on the deal and walks away from their stewardship role) then on the next sale, the city would be paid back the $100,000 loan.
This is correct – the RFP states that alternative financing terms are available to projects offering permanent affordability; up to 50% of the total loan is eligible to be forgiven.
3. Given the 125% loan to value requirement, is there any flexibility in that number? For acquisition/rehab project, the costs incurred don’t significantly increase appraised value.
We recognize that achieving a 125% loan-to-value ratio can be challenging for acquisition/rehabilitation projects, as incurred costs do not always translate directly into increased appraised value. If this threshold cannot be met, please provide an explanation along with the anticipated loan-to-value ratio. This factor will not determine project eligibility on its own but will be considered as part of the overall scoring process.
4. Our firm does not need a construction loan, can these funds be used for mortgage assistance only?
You may submit an application for mortgage assistance only. However, we encourage you to review the scoring criteria and the project types that receive higher scores, as outlined in Appendix A (Section IV), before applying.
5. When is the mortgage assistance loan to the homeowner paid back to the City?
For projects without permanent affordability, the mortgage assistance loan is repaid to the City when the homeowner sells the property or transfers ownership.
6. What types of costs do you consider “soft costs”?
“Soft costs” refer to reasonable and necessary expenses incurred by the owner or participating jurisdiction in connection with the financing and/or development of a housing project, including new construction, rehabilitation, or acquisition. Examples include architectural and engineering services, permit fees, legal fees, recording fees, and similar non-construction-related expenses.
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