Housing Opportunity Fund

The South Dakota Housing Opportunity Fund (HOF) is a state-administered grant initiative that promotes economic development through the expansion of affordable housing for low- and moderate-income individuals and families across South Dakota. Created by legislative action in 2013 under Senate Bill 235 as part of the “Building South Dakota Fund,” the program is governed by South Dakota Codified Law 11-13 and administered by the South Dakota Housing Development Authority (SDHDA) in coordination with the SD Housing Board of Commissioners. The HOF provides financial resources to a diverse range of entities for the development and preservation of housing that meets essential safety, affordability, and accessibility standards. Funding from HOF can be applied to a broad set of project types, including the new construction or purchase and rehabilitation of both rental and homeownership housing units. In addition, the fund supports home repair grants, modifications to improve accessibility for individuals with disabilities, homelessness prevention initiatives, and the creation of community land trusts. Within the homelessness prevention area, eligible uses include assistance with rental and utility deposits, rental arrears, short- to long-term rental support, and housing stabilization costs. Eligible financing instruments for applicants include 5-year deferred mortgages or forgivable loans, which are forgiven annually over a five-year period. Eligible applicants include for-profit and nonprofit organizations, tribal governments, housing authorities, and political subdivisions of the state or its agencies. The HOF programs are structured to allow equitable access to both rural and urban areas. Development projects are subject to location-based funding caps: $500,000 per developer for rural areas and $200,000 per developer for urban settings. Additionally, administrative costs are capped at 10% of the total HOF funding request. Application cycles for the HOF vary slightly by project type. For rental housing and homeownership development projects, applications are accepted on a rolling basis from April 15 through August 31 each year and are reviewed on a first-come, first-served basis once deemed complete. For program-based activities, such as homeowner rehabilitation and homelessness prevention, applications follow a competitive annual cycle, with a deadline set for the last working day of August at 5:00 p.m. Central Time. All submissions must be delivered by mail or through the SDHDA online portal; email or fax submissions are not accepted. Applicants are encouraged to refer to Exhibit 1 of the HOF Plan Application for detailed submission instructions. The evaluation process for HOF applications considers factors such as income targeting, feasibility, administrative capacity, cost effectiveness, and the potential impact on community housing needs. Programs are expected to provide services to households earning up to 115% of the area median income (AMI), with prioritization for households at or below 80% AMI. Projects may include homebuyer counseling, tenant support services, and partnerships with service providers, depending on the proposal type. Performance measurements are to be included in the narrative to demonstrate how affordability, accessibility, and outcomes will be tracked. Award announcements and notification timelines are not explicitly stated, though applicants are informed that conditional funding commitments may be made by SDHDA and are subject to change. The fund operates on an annual recurring basis, with application deadlines and procedures generally consistent year to year. Official inquiries may be directed to SDHDA’s main line at (605) 773-3181. Further guidance and downloadable resources, including the full application form, are available through the SDHDA website.