City asks CPA committee to consider using CPA funds for down-payment assistance as HUD price caps exclude buyers

Bob Dems, of the City of Springfield Office of Housing, told the Community Preservation Committee that federal HOME program rules and area median price caps are preventing otherwise income-eligible residents from using down-payment assistance: "you can't... find a home in Springfield for under $200000 in existing single-family home" he said, describing an effective HUD 95% median-sales-price cap that now exceeds the market for many city buyers.

Dems explained that the HOME program restricts assistance by a sales-price cap tied to 95% of the Hampden County median; that number was reported in the meeting as about $198,000 for the prior year and was slated to rise to roughly $213,000 in the new HOME limits effective June 1. He said the city has repeatedly had to turn away otherwise-eligible buyers because the sales-price cap prevents them from receiving HOME-funded closing or down-payment help even when buyers meet income eligibility.

Dems described CPA as an alternate funding stream that does not impose the same sales-price cap (though CPA still follows income limits). "CPA does not have a sales price cap they do have the income cap... the income cap goes to 100% of the area Median income," he told the committee, arguing CPA-funded down-payment assistance could help buyers priced out of HOME assistance. Committee members asked for further detail on the proposed CPA program structure, the population it would prioritize, and whether funding would inadvertently exclude buyers in the 80–100% AMI band if CPA dollars are used primarily for lower-income applicants.

Dems agreed to provide the committee with more granular income- and eligibility-illustrations and historical program data so members could weigh a narrowly targeted CPA award. The committee directed staff to accept supplemental information and consider the down-payment request as part of deliberations beginning June 1.