USDA - RD: Long-term debt instruments were provided by the United States Department of Agriculture Rural Development (USDA-RD) pursuant to its Rural Rental Housing Program under Section 515 of the National Housing Act of 1949 for Academy Apartments, Acorn Acres, Alicia Arms, Carlton Court, ECL Annex, Edenton Manor, Fairhaven Manor I, Fair Winds, Greenwood Acres, Harbour Towne, Maple Hill, Marshall Manor, Park Royal, Ridgely Meadows, 2nd Fairhaven, West Street Elderly, and West Street Manor Annex (the “Projects”). The debt instruments are secured by mortgages on the real estate, interests in personal property, and assignments of income to be derived from the Projects. The mortgages each have a term of 50 years. The properties listed above executed obligations with USDA-RD under its Section 515 Rural Rental Housing Program. Although the loan proceeds were received and expended in prior years in connection with each property’s original construction or rehabilitation, the loans remain subject to ongoing compliance requirements throughout their full terms. As noted, the mortgage balances presented above reflect the outstanding principal balances as of December 31, 2025. For purposes of the Schedule, the loans under the Section 515 Rural Rental Housing Program are reported at their balances at the beginning of the year, which totaled $14,021,580. In addition, USDA-RD provided interest credit subsidies during the year totaling $880,097, which reduced required debt service payments by effectively lowering the interest rates charged on the loans, in some cases to as low as 1%. These subsidies are also reported on the Schedule separately as federal expenditures from the same program. HUD HOME: Long-term debt instruments were provided by the Delaware State Housing Authority (DSHA) pursuant to the Home Investment Partnership Program (HOME), on behalf of the United States Department of Housing and Urban Development (HUD) for Acorn Acres, East Atlantic, ECL Annex, Harbour Towne, Lingo Creek, Long Neck, Luther Gardens, Marshall Manor, Milton Landing, and West Street Manor Annex (the “Projects”). The debt instruments are secured by mortgages on the real estate, interests in personal property, and assignments of income to be derived from the Projects. The mortgages each have a term of 30 years. The properties listed above executed obligations with DSHA, on behalf of HUD, under its HOME Investment Partnership Program. Although the loan proceeds were received and expended in prior years in connection with each property’s original construction or rehabilitation, the loans remain subject to ongoing compliance requirements throughout their full terms. As noted, the mortgage balances presented above reflect the outstanding principal balances as of December 31, 2025. For purposes of the Schedule, the loans under the HOME program are reported at their balances at the beginning of the year, which totaled $8,907,340.
Certain properties receive project-based federal rental subsidies on behalf of eligible tenants. These subsidies cover the difference between the tenant's income-based contribution and the Project’s approved contract rent, ensuring that tenants are not required to pay more than a prescribed percentage of their adjusted income towards their housing costs. For USDA-RD subsidized properties, this assistance is provided through the Rural Rental Assistance Program. For HUD subsidized properties, the assistance takes the form of Housing Assistance Payments (HAP) from HUD's Section 8 Program. During 2025, the Corporation earned $2,426,789 from USDA-RD and $588,547 from HUD under these programs.
The Corporation expended $289,100 from USDA-RD under the Self-Help Housing Technical Assistance Program. This program provides funding to nonprofit organizations that assist low-income families in constructing their own homes through mutual self-help methods. The funds were used by MHDC to provide administrative and technical support for operating and overseeing self-help housing activities. The Corporation expended $33,333 from HUD under the Community Housing Development Organization (CHDO) program. This program, administered as part of the HOME Program, supports qualified nonprofit developers in producing affordable housing. The funds were used to assist with pre-development and construction costs related to affordable housing projects for low-income individuals and families. The Corporation expended $104,446 from HUD under the Community Development Block Grant (CDBG) program. The CDBG program provides flexible funding to support a broad range of community development initiatives. The funds were used to support housing rehabilitation and repair activities for low-to-moderate income homeowners through the Corporation's Home Repair Project.
The American Rescue Plan Act (ARPA), enacted in 2021, provides economic relief in response to the COVID-19 pandemic. Administered by the United States Department of the Treasury, the Coronavirus State and Local Fiscal Recovery Funds (SLFRF) program supports eligible state, local, and nonprofit entities in addressing public health and economic impacts of the pandemic. During 2025, the Corporation expended $2,385,334 of ARPA funds originating from two pass-through awards. The remaining unspent balance of $670,584 is reported as a component of deferred revenue as of December 31, 2025. The subaward expenditures consisted of the following: The Corporation received SLFRF funding passed through the State of Delaware (SLFRP0139), of which $1,756,762 was expended during 2025. Expenditures included capital contributions to the projects in the Corporation's Beach Portfolio for improvements and repairs, the acquisition of the Wellness Village property, funds allocated for homeownership settlement assistance, and reimbursements for other administrative costs. The Corporation also received SLFRF funding passed through Sussex County, Delaware (SLFRP4442), of which $628,572 was expended during 2025. These funds supported homeownership assistance through settlement payments for eligible families, with a portion from the City of Lewes, also originating from the Sussex County award, used to benefit Dutchman's Harvest. The Corporation received these awards as a subrecipient of the State of Delaware and Sussex County, which are the direct recipients of the SLFRF awards from the U.S. Department of the Treasury. As a subrecipient, the Corporation is responsible for using the funds in accordance with the terms and conditions of the subaward agreements and for maintaining adequate documentation to support all expenditures. Federal compliance and reporting obligations under the SLFRF program, including Treasury reporting requirements, are the responsibility of the primary recipients. All remaining funds must be expended by December 31, 2026, at which time the period of performance ends.