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Office of Mental Health

Service-Enriched Single Room Occupancy (SRO) NY/NY III
Request For Proposal
Questions and Answers

Population | Budget | Property/Siting | General Questions | Limitations on HCR Funding 


  1. In Section 4.1, it indicates that 20 points are related to "Population". As the population served is dictated by the RFP, what are these points for?
    • The "Population" section of the proposal evaluates how well the applicant describes the characteristics and service needs of the population.
  2. I am writing with regard to the January 2011 New York/New York III RFP. On page 15, under the topic Population, Question 1 asks us to "provide a brief narrative which describes in full detail the model proposed for the housing". My question is what details you are seeking in this response. What specific details do we need to provide?
    • Your response should explain if the proposed project is new construction, a renovation or a purchase of an existing building. It should describe the population groups that will be housed. It should also include whether a site has been secured, describe the stage of development it is in, and the status of any capital or operating grants for the site.
  3. In section 5.4 of the RFP, it indicates that persons under an AOT within the targeted group will receive priority consideration for admission. HCR requires that a priority be given for persons within the targeted group to veterans of the armed forces of the United States. How will these preferences work within the DHS referral process under NY/NY III?
    • OMH units are designated for individuals meeting the NY/NY III Population A criteria, and within this group, OMH considers individuals under a current Assisted Outpatient Treatment (AOT) order to be a priority admission. At this time, the NYC Department of Homeless Services (DHS) referral system does not give preference to veterans for NY/NY III Population A. However, the developer/provider may request and prioritize Population A eligible veteran referrals from DHS.
  4. Section 5.1 of the RFP indicates that it is anticipated that an average size project will house between 25 and 50 individuals with serious mental illness, integrated within a larger, mixed use housing project and a number of factors will influence the final number of units. As we are submitting an application to HCR on or before February 9th and will set the number of studio apartments in the project based on the number of OMH NY/NY III units being applied for, we would like feedback on what an acceptable mix is now. In an approximately 56 unit project, are approximately 32 OMH units an acceptable mix if the remaining 24 units are one and two bedroom units targeted to non-special needs families? We have done several projects like this previously with HCR and they were considered integrated projects that were well received by the residents and the local communities. While 57% of the units would be OMH NY/NY III, that will translate to approximately 35% of the building residents as the other units will be occupied by multiple person households/persons. It is difficult to make the economies of scale work for 24 hour front desk coverage and service provision with less than 32 NY/NY III units.
    • OMH prefers a 30% SMI population to 70% non-SMI population ratio. OMH considers the ultimate goal to be integrated mixed-use housing development. OMH will not consider a 100% SMI population.
  5. What is an acceptable mix of SMI units and non – SMI units in a building?
    • Please refer to the answer above.
  6. At the bidder's conference, the answers about what constituted integrated housing did not seem to be entirely consistent. OMH indicated several times that the OMH units were to be integrated with regular housing. But in response to a question about whether the non-OMH units could be other special needs units (e.g. people with HIV/AIDS) OMH seemed to answer in the affirmative. Mixing formerly homeless adults with serious mental illness with other special needs populations doesn't seem like very integrated housing. Would you want the total of all special needs populations (OMH and other) to be limited to 60% of units? Can you clarify OMH's position on this?
    • The non OMH units must be for persons who don't have a serious mental illness. The target population for the non OMH units will depend upon the funding available to support the development and operation of these units. OMH would not want more than 60% of the units to be for disabled persons.
  7. Can other funding for special needs groups be included in this project, i.e. HASA?
    • Yes, see previous question and answer
  8. When the RFP asks to describe the population under the scored Population section, who is the population referring?
    • The population refers to individuals meeting the Population A criteria under the NY/NY III agreement who will be served in the OMH units. It does not refer to any other individuals who may be tenants of the mixed-use units.
  9. For the new SRO RFP, can we propose to serve a subset of Population A (e.g. seniors, HIV/AIDS clients) in our housing?
    • No, applicants are not allowed to limit accessibility by proposing to serve a subset of Population A. Applicants must be selected from the referrals forwarded by the NYC Department of Homeless Services. Also, priority must be given to anyone within the target population who has an Assisted Outpatient Treatment (AOT) order.


  1. Also in section 5.1, it indicates that an SP-SRO must offer 24 hour front desk coverage, however 24 hour staffing is not required. Is that implying that the front desk coverage can be provided without physical staff present on-site – i.e. through a virtual doorman/concierge service? Or is it indicating that the other support services staffing does not need to be provided 24 hours? Is it okay during times when support services staff are on-site for such staff to cover the front desk instead of having separate staff during those hours?
    • Front desk coverage is generally required for all OMH SP-SROs. Support staff is not required on a 24 hour basis. If the number of NY/NY III beds does not support full front desk coverage, however, some flexibility will be allowed. The agency's proposal should explain how safety and security will be ensured for the building and its residents if there is less than 24 hour front desk coverage. Also, the agency may use a portion of the "on-site services and supports" portion of the budget for front desk coverage, provided that sufficient services are provided to the NY/NY III tenants. Support staff should not routinely provide front desk coverage.
  2. Please confirm that the 24 hour front desk staffing comes out of the approximately $11,868 for on-site services and supports. The Appendix B – Operating Budget seems to include it as a property expense which seems impossible in light of the amount of funds specified for property expenses.
    • Front desk coverage is generally paid through the $6,470 allocated towards property expenses. However, OMH will consider some front desk coverage paid from the $11,868 allocated for on-site services and supports. Final approval is based on a review of the overall staffing plan and budget.
  3. Can security be used in the property category?
    • Flexibility is allowed when calculating the budgets especially with regards to security or 24/7 staff coverage. A portion of operating funding can be used towards 24/7 front desk security/staff. The amount calculated can be higher than the stated amount in the RFP to be used for property ($6,470). OMH will review each proposal's budget to ensure an adequate amount of funding is provided towards the service needs of the residents.
  4. Can on-site services and supports be used for property expenses and vice versa, can property funding be used for on-site services?
    • Some flexibility may be allowed. See previous answers above.
  5. For those applicants who are not the developer/owner, is it the expectation that OMH funding is to provide front desk reception/security for the entire building if we are only occupying 32 apartment/beds?
    • Some flexibility is allowed. See other similar responses above.
  6. Can staff from another program be used for front desk coverage?
    • Flexibility will be given with regards to 24/7 front desk coverage. Bidders should clearly describe in their proposal how the safety and security of the residents and building will be maintained.
  7. In section 5.6 of the RFP, it indicates that approximately $6,470 per bed may be budgeted toward property expenses which we assume would mean the amount of rent being paid. This results in a monthly rent of $539 which is well below what a tax credit 0-BR unit rent would be at 60% AMI (Area Median Income). or even at 50% AMI. Even with HCR subsidies for the development of the units, it is very difficult to make a project feasible with 0-BR unit rents at $539 per month. How much flexibility is there on the portion of the funding that can go toward rent/property expenses?
    • Budgets will be reviewed on an individual basis. Use the budget narrative section in your proposal to explain the logic behind the line item calculations and the assumptions you are making. Flexibility in moving some of the funding to the property side of the budget will be considered provided the program design includes sufficient support services and adequate staff.
  8. Also, when referencing "property expenses" it indicates "(non debt service)". Most integrated supportive/affordable housing projects have debt service, even if it is just Housing Trust Fund Corporation debt service. But many have conventional debt service as well. Is there a prohibition on the rents from the OMH units paying for debt service? And since rents go into an operating account that pays a variety of operating expenses including debt service, reserves, etc., how would such a prohibition work?
    • There is no prohibition in having client rents pay debt service. The overall budget must be balanced and consistent with the operating funding amounts outlined in Section 5.6 of the RFP.
  9. Also in section 5.6, the client share of income (SSI Living Alone rate of $2,329 assuming 85% collection) does not take into account a utility allowance for the client paying for their own electricity. In a typical integrated housing project, electric is individually metered for each apartment and paid by the tenant (individual metering is also a requirement for HCR Housing Trust Fund projects).
    • Client rent must assume a reasonable allowance for utility costs. The OMH Supported Housing guidelines state that a client pays 30% of their income for rent and reasonable utility costs. Utilities are an allowable expense under the $6,470 per bed allocated towards property costs.
  10. The budget forms seem to contemplate a scenario where the non-profit applicant is operating the whole building. In a situation where the non-profit applicant to OMH will utilize a group of units in a larger building being developed by a third party developer being funded by HCR, the applicable budget line item for property expenses would be "rent" as the OMH funds would be used to pay rent as opposed to individual property expense items. In such a scenario, can "rent" be put in the "other" row as a line item and the amount going toward rent included there?
    • In this scenario, the applicant may indicate a "rent payment" for the group of NY/NY III units or it may itemize the property expenses. Either way is allowed. Use the budget narrative to explain the budgetary calculations. If the non-profit will pay rent to the developer explain what the rent covers and the terms of the master lease, including rent increases.
  11. The funding model in Section 5.6 & Budget Form Appendix B is structured as if the provider is the developer. If the Provider Agency is providing services only and pays rent/utilities similar to a typical supported housing program, how is this reflected in the Budget Form Appendix B?
    • In the budget form you may indicate "rent" and leave the property expense columns blank. In the budget narrative describe the relationship between the developer/owner and the service provider. Describe what "rent" covers.
  12. If we are providing services only, how do we complete the Appendix B Budget Form? Where do we budget for typical supported housing expenses such as rent?
    • You can write "rent" on the form and provide an explanation in the budget narrative section.
  13. Can rent increases be tied to rent stabilization process?
    • Yes
  14. Can we combine the OMH funding with HUD Shelter Plus Care?
    • Using two rental subsidies for the same housing unit is not allowed (i.e. OMH and Shelter Plus Care). You may use Shelter Plus Care to fund additional rental units beyond those covered through OMH funding, as long as there are additional affordable housing units in the building.
  15. Can OMH operating funds be used to provide services to other non OMH units?
    • No, the funding available through this RFP is to be used for the units serving individuals who meet the Population A criteria of NY/NY III.
  16. How does HCR fund capital reserve?
    • For projects utilizing 9% LIHC:
      An operating reserve capitalization of 1% of total development cost must be included in the development budget. This can be funded with LIHC equity proceeds or another eligible source. Neither NYS Housing Trust Fund money nor HOME funds may be used to capitalize an operating reserve.

      For projects that include HCR capital funds (i.e. HTF or HOME) an annual operating reserve contribution equal to 3% of gross rent must be provided in the project operating budget. Annual operating reserve contributions are not required for projects which request only tax credits from HCR.

      Replacement reserves are funded by annual contributions in the project operating budget. For non-senior projects with HCR capital funding, annual replacement reserve contributions of .5% of construction, including builder's fees, up to a maximum of $800 per unit are required. For non-senior projects without HCR capital funding, the required contribution is $300 per unit annually.
  17. How does OTDA fund/calculate capital reserve?
    • At the end of the Questions and Answers is an excerpt from the HHAP RFP which outlines HHAC's policy regarding capital and replacement reserves. Potential applicants should note that the maximum amount of reserve funding that HHAC will provide (for both replacement and operating reserves) is $100,000. For additional information about reserve and other HHAC policies, applicants are encouraged to review the HHAP RFP which is located on OTDA's website Leaving OMH site.
  18. Down the line, the agency needs money for a major repair, who pays?
    • Housing developed with HHAP funding should be constructed to withstand the test of time and tenants. Proper tenant relations and maintenance protocols should negate the need for repairs to new programs for quite some time. However, should the need for repairs become evident, it is HHAC's expectation that accumulated reserves will be able to cover the cost. HHAC does not have a separate, dedicated pool of funds for asset management needs. Any money spent on existing projects takes away from the creation of new units. HHAC's Asset Management Unit will work with sponsors experiencing repair needs to identify the most appropriate funding source. HHAC is under no obligation to fund future repairs.

      For HCR, the project replacement reserve is established for the purpose of covering future replacement cost of items such as flooring, plumbing systems, heating systems, electrical systems, roofs, windows etc. To the extent possible this reserve should be used to cover major repairs. There is no obligation on the part of HCR to provide any additional funds to recapitalize projects as systems reach the end of their useful lives.


  1. If my agency does not have site control, should we still apply to the OMH services only RFP?
    • Yes. If your OMH proposal scores 65 or above, you will receive a written award letter from OMH to include in future applications made to HCR or OTDA for capital funding. Site control is required for the HCR and OTDA (HHAP) capital grant applications, but agencies can apply to HCR and/or OTDA in the next available round later this year or in future rounds once site control is obtained. For additional information about OTDA's site control requirements, please see the HHAP RFP.
  2. If my agency has multiple sites, do I need to make an application to HCR for each site?
    • Yes. If your agency has site control, an application for each site is required.
  3. In a case where a non-profit applicant to OMH is utilizing a group of units within a building to be constructed by a third party developer, is a master lease scenario acceptable to OMH? This has frequently been used in NY/NY III projects with City agencies.
    • Yes, a master lease is acceptable but it must be reviewed by OMH prior to signing.
  4. If we are providing services only and are not the developer/owner, is there an expectation that the property related funding from the RFP is to be shared with the developer/owner? If so, what portion will be shared?
    • You will need to negotiate a rent payment with the owner in conformance with the owner's low income tax credit application. OMH must review the lease before it is signed.
  5. If we use HPD's Supported Housing Loan Program for capital funding (along with HCR and/or HHAP capital), can we use their design guidelines which don't require a full kitchen and allow for studios that are smaller than 300 square feet?
    • The capital for the NY/NY III units must include HCR or HHAP Funding. Accordingly, you must adhere to HCR or HHAP's design standards. For units receiving OMH operating funding, these units should be designed to include a full kitchen and be at least 300 square feet.
  6. Does HCR or OMH offer any assistance with pairing agencies to known project developers?
    • No, however HCR does have a list of developers on their website who have been awarded past projects and providers may access this public information via the site.
  7. Can an Agency develop multiple sites?
    • Yes, there is no limit on how many sites an agency can potentially develop.
  8. Does any agency need to have site control to apply to the OMH RFP?
    • No, an agency does not need site control to apply for units under this RFP. However both HCR and OTDA do require site control for applying to their RFP's. Please refer to the HHAP RFP for additional information about OTDA's site control requirements.
  9. Is there a minimum number of OMH units that a project would need to receive the extra points on HCR/OTDA's RFP?
    • HCR recommends that under the NY/NY III initiative, 15% or more of the total project units should be targeted to one or more NY/NY III eligible populations. For OTDA, no minimum number of units has been established; however, bonus points are only awarded to applicants proposing to house individuals who meet Category A eligibility criteria.
  10. Are we to apply for capital funding through HCR or OTDA if we are not the developer/owner of the building?
    • An agency may be the developer/owner or may partner with a developer/owner. Either arrangement is permissible. For specific information on who can apply to HCR or OTDA, please contact these agencies directly.
  11. Under Scope of Work (V.5.2) the RFP notes OMH Supportive Housing living units "may be designed as studio apartments, one bedroom apartments or shared two bedroom apartments". Does this mean that in the event that two Population A adults desire to live together, that both individuals are eligible to receive the full operating and service subsidy, even if they choose to share one two- bedroom unit? Or a one-bedroom unit?
    • Applicants will need to follow the design guidelines of the capital funder for the beds which is either HCR or OTDA. If two population A individuals live in a two bedroom apartment, the agency will receive an operating/service subsidy for 2 individuals. If two population A individuals live in a one bedroom apartment, the agency will receive one subsidy. In general the subsidy is for the bed. If the agency develops 20 beds, it will get an operating subsidy for 20 beds.

General Questions:

  1. Can you provide the Agency Transmittal form and the Budget form in a Word and Excel document?
    • These forms are not available in Word or Excel.
  2. Given the final deadline for the HCR application is February 9th, what constitutes proof that an agency applied to the OMH RFP?
    • A letter from the agency of its intent to apply will suffice given that HCR and OMH will be in communication regarding all applications.
  3. Does HCR have a system of set asides for this initiative?
    • No. HCR does not have separate capital funds specifically designated for these NY/NY III units.
  4. Should my agency apply for the HHAP (OTDA) grant during this round of open or rolling RFP?
    • HHAP has already received applications from nine NYC organizations in this round, which are likely to reach or exceed the $18 million in funding that can be awarded to the NYC region for FY 2010 - 2011. However, if your agency has site control and is ready to apply at this time, applications are still being accepted. Once available SFY 2010-11 funding has been awarded, the next window for the open RFP process will be announced some time after the NY State Budget is passed.
  5. Can my agency apply only for the OMH RFP and provide our own capital for the construction?
    • No, you must also receive an award from HCR or OTDA for the NY/NY III beds.
  6. What are you looking for in an MOU? Do you want the MOU itself?
    • Include the actual MOU in your application as an attachment. Describe in detail the structure of the relationship with the partnering agency and explain the role each will perform to carry out the services/deliverables to the target population. A master lease agreement, if used, should also be attached.
  7. If my agency has multiple ideas or several models we may want to develop, should we describe each idea in one proposal to OMH?
    • Yes
  8. If my agency has multiple ideas we may want to do and it is easier for us to submit more than one proposal, can we do so?
    • Yes
  9. If we are submitting more than one idea or model, do separate budgets need to be developed for each model?
    • Yes
  10. Does an agency have to be licensed to apply under this RFP?
    • No, but eligible applicants are limited to not-for-profit agencies with 501(c) (3) incorporation that have experience providing housing to individuals with a serious mental illness. Additional eligibility criteria are outlined in the RFP and should be reviewed carefully.
  11. If a potential applicant sent in a letter of intent but did not attend the bidder's conference, are they eligible to apply?
    • Attendance at the bidder's conference is mandatory. If the agency did not attend or send a representative, it may not apply.
  12. What is the limit on funding that is provided from the Housing Trust Fund and OTDA? Is it per agency, per site, per region, etc.?
    • The limitations on HHAP funding are as follows:
      1. No more than 60% of available funds can be awarded to any given geographic area. Geographic areas are defined as: the five boroughs of New York City; Westchester, Nassau and Suffolk counties (the suburbs); and the rest of the state.
      2. No single applicant agency can receive more than 25% of available funding for one or more projects. With a $30 million appropriation, the limits are $18 million and $7.5 million respectively.

The limitations on HCR funding are as follows:

  1. Housing Trust Fund Program:

    The maximum per-unit amount of HTF that may be requested is $125,000. The maximum HTF funding request per project is $2 million. However, up to $2.4 million may be requested for projects which meet one or more of the following criteria:

    1. 50% or more of the units have three or more bedrooms to serve large families (defined as households with five or more persons);
    2. 50% or more of the units will serve persons with special needs as listed in the HCR Unified Funding 2011 Reference Materials, Section 11, and for which appropriate on- or off-site services will be provided by an experienced service provider.
    3. demonstrate compliance with the requirements of the Green Building Initiative by receiving a score of seven or more of the ten points available under the initiative; or,
    4. demonstrate compliance with the requirements of the Energy Efficiency Initiative (see Section F2 - Requests for Proposals 2011).
  2. Low Income Housing Credit Program:

    The maximum annual LIHC allocation per unit that may be requested is $22,000. The maximum annual LIHC allocation per project that may be requested is $1.43 million. However, up to $1.65 million may be requested for projects in which:

    1. 50% or more of the units have three or more bedrooms to serve large families (defined as households with five or more persons);


    2. 50% or more of the units will serve persons with special needs as listed in the HCR Unified Funding 2011 Reference Materials, Section 11, and for which appropriate on- or off-site services will be provided by an experienced service provider.