How do grantees determine the LMMI benefit standard for NSP-assisted rental developments?

Date Published: October 2012

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Occupancy of NSP-assisted housing by LMMI households under the LMMI Housing national objective is determined using the following general rules: 

  • All NSP-assisted single unit structures must be occupied by LMMI households.
  • An NSP-assisted two-unit structure (duplex) must have at least one unit occupied by an LMMI household.
  • An NSP-assisted structure containing more than two units must have at least 51 percent of the units occupied by LMMI households; however, per the guidance in the Unified NSP1 and NSP3 Notice, there are alternate ways that grantees can meet this rule. The additional methods of meeting occupancy requirements are:
  • Grantees may follow the HOME program requirements at 24 CFR Part 92.205(d).; or
  • The number of income eligible units is proportional to the amount of assistance provided. Note that this approach may only be used if the units are generally comparable in size and finishes.  

Example: If a grantee has a 10-unit project with a total development cost of $1 million, including $400,000 of NSP funds, 40 percent of the units (or four of the ten units) would have to be LMMI. The rest could be market rate.

The grantee must select and use just one method for each project.

Tags: NSP Rental Housing Development