HomeMy WebLinkAboutResolution - 2005-R0285 - Approve HOME Funding - CHRB Lease-Purchase XI Program - 06_23_2005Resolution No. 2005-R0285
June 23, 2005
Item 66
RESOLUTION
IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
THAT the City Council of the City of Lubbock does hereby approve of the
)osal for the Community Housing Resource Board Lease -Purchase XI Program from
Home Investment Partnerships (HOME) Program and all related documents. Said
)osal is attached hereto and incorporated in this resolution as if fully set forth herein
shall be included in the minutes of the City Council.
Passed by the City Council this 23rd day of Juni % , 2005.
MAYOR
TTEST:
Garza,
OVED AS TO CONTENT:
ancy Haney
OVED AS TO
Sims,
;s/res-CHRB-Lease-Purchase XI Prog-HOME.res
17, 2005
Page 2
FY 2005-2006 Funding Request
To submit an application, complete Part A — J, Attachments 14 (if applicable) and .any other items requested. Do
not bind the application or include any items that are not requested. Submit one proposal per project. Submit one
original and one copy of each application (SINGLE SIDE ONLY) to Community Development, 1625 13th Street,
PO Box 2000, Lubbock, Texas 79457 by April 1. 2005 5:00 PM. Please review the "Citizen's Guide" for the
Community Development programs, goals, requirements and timelines. For assistance, please call the Community
Development Department at 775-2301.
A. GENERAL INFORMATION
1, NameofApplicant: Community Housing Resource Board of Lubbock
® Not -For -Profit ❑ For -Profit ® CHDO []City Dept. ❑ Other
(Please include a copy of your IRS ruling providing tax exempt status under
Section 501(c)(3) of the 1986 IRS Code if you are a non-profit.)
2. Name of Project: Lease/Purchase XI
3. Area or Location of Project: City of Lubbock — Prioritizing in Targeted Areas
4. ContactPerson/Title: Maggie Trejo, Executive Director
MailingAddressMp: 1628 Main Street, Lubbock, TX 79401
Telephone/Fax Number(s): 8 0 6 7 6 3— 3 8 7 7 / 80 6 7 6 3— 3 8 8 3
5. Grant Request: ❑ CDBG ❑ ESG ® HOME
6. Amount of Funds Requested for Project: $17 4 , 7 5 0
7. Amount of Matching Funds for Project: , $ 4 3 , 6 8 8
Match Type: ❑ Cash ❑ Sweat Equity [Other Grants ❑ Donations
Identify Source of Match: private foundations and difference of assessed
value and sales price
Match Status: ❑Confirmed ® Requested
8. Unduplicated Units Served (agency's definition) Average of four persons per household
(a) Total CD Funds Requested_ S 174, 750 d) Total Project _ $ 218 , 43 8
(b) Total Unduplicated Units Served 4 e) Total Unduplicated Units Served 4
(c) Average CD Cost Per Unit (a/b)% 4 3 , 6 8 8 I fl Average Cost Per Unit (d/e): $ 5 4 , 610
9. Is this project? ❑Year 1 ❑ Year 2 ❑ Year 3 ® Year 4
l
FY 2005-2006 Funding Request Page 3
B. PROPOSED PROJECT: Project Description: In two sentences concisely describe your project.
This description will be used in future publications should your application be approved. Limit two
sentences 'him LeaseMurchase Program enables low to moderate -income families become homeowners within a two year
period by providing a forgivable loan in the amount up to $2,300.00 for down payment and closing coat and counseling them to
leam to budget and -be credit ready. CHR$ purchases pre -owned houses and complewly rehabilitates them before leasing them to
families that eventually will become homeowners.
C. CONSOLIDATED PLAN GOAL Check the ONE GOAL that best describes your project.
Check
One
X
Prioritized Objective
from Consolidated Plan
H-1
H-2 Owners -Limited Rehab
H-3 Owners -Assistance for
Home Buvers
Number of Units
This Project Will Serve
Households:
4
Households:
Households:
Economic Development
CD-1 Rehab of Publicly/Privately Owned # of Low -Mod Business Owners:
Businesses
CD-2 ED-Direct Assistance to For -Profit # of Jobs Created:
CD-3 Micro -Enterprise Assistance # of Low -Mod Business Owners:
CD4 Street Improvements # of Low -Mod Households:
CD-5 Sidewalks I # of Low -Mod Households:
Public Service
N/A
CD-6 Handicapped Services for Job Training
# of People Served:
N/A
CD-7 Handicapped Services for Recreation
# of People Served:
N/A
CD-8 Substance Abuse Services for Rehabilitation
# of People Served:
N/A
CD-9 Substance Abuse Services for Shelter
# of People Served:
N/A
CD-10 Substance Abuse Services for Training
# of People Served:
N/A
CD-11 Employment Training for Computer Skills
# of People Served:
N/A
CD-12 Employment Training for Job Readiness
# of People Served:
N/A
CD-13 Employment Training for Reading Skills
# of People Served:
N/A
CD-14 Health Services for Children
# of People Served:
N/A
CD-15 Mental Health Facilities for Operations
# of People Served:
D. PR4JECr SAY
1. Summarize your proposed program. Explain how this program fits with your mission. How will it
impact your current operation? How does this program relate to the Consolidated Plan priority?
Does this program serve a targeted area? Who is the target population? Where will the program take
place? How will this program benefit the Low -Mod income community? Are you working with
other organizations in a cooperative effort on the program? LEWr 3 pages
D. PROPOSED PROJECT
1. Project Summary
Community Housing Resource Board of Lubbock (CHRB) would like to continue a project that
has been successful in enabling families in the 301/6-80% of median income become
homeowners. Since the mission of CHRB is to make homeownership accessible to low to
moderate -income individuals, this project indeed makes this possible because it gives families
the opportunity to save while they lease the property that eventually will become their own. For
families that complete the program, forgivable loans for down payment and closing costs will be
granted when the houses are financed through financial institutions of their choice. The grant can
be up to $2,500.00, depending on the length of time they lease. The families can combine the
grant with their tax money which most families in this income level get for earned income credit
and child tax credit.
While the families are leasing, they have the opportunity to become credit ready and learn to
budget and how to maintain a house. This is accomplished by having periodic counseling
sessions scheduled with CHRB staff. At the same time, if they need to have job stability, they
can do so while leasing. The time frame for this program is six months to two years.
The program has become well known and the ones participating in the program are usually the
ones that spread the word about the program. At the present, we have a waiting list of about 15
families that want to participate. Those applications are already processed and when a house
becomes available that fits a family profile, they are contacted.
To date, thirty houses have been purchased, twelve have sold and seven are occupied with
prospective buyers. Three houses are in the process of being leased and five houses are being
rehabilitated and when completed, pre -qualified families from our waiting list will be considered.
With the funding that CHRB is requesting we will be able to purchase four to five houses, CHRB
will continue to provide more homes to those that otherwise would never have the opportunity to
own a home due to not being able to save funds on their own for down payment and closing costs
without learning to budget and getting credit ready.
Although this a citywide program, CHRB has concentrated in acquiring houses in the targeted
areas as designated by the City because the neighborhoods have identified housing as the number
one priority. CHRB believes that this project will act as a catalyst in converting renters into
homeowners, thereby stabilizing the neighborhoods.
CHRB has the experience in making this type of program work since it was its Executive
Director who developed this program. Since the program was established, improvements have
been made to better serve the families. Therefore, it will not create an additional burden in the
daily operations of CHRB. With the funds requested, CHRB will concentrate on the new
couriers areas, which the City has identified.
D. GOALS AND OBJECTIVES
2. Goals and Objectives
Community Housing Resource Board of Lubbock (CHRB) goals and objectives are:
1. Provide rehabilitated and affordable housing in targeted areas for the low to moderate -
income families who would otherwise be unable to purchase a house die to credit flaws
and/or lack of funds for down payment and closing costs.
2. Design an individual plan for each family to help acquire homeownership within an
agreed period of time.
3. Made available a forgivable loan in an amount of up to $2,500.00 for those families that
complete the program for down payment and closing costs.
4. Be instrumental in stabilizing older neighborhoods by promoting homeownership.
5. Approximately 16 individuals will benefit if an average number of four persons occupy
each house.
D. Activity Measures/ Goals and Me& es and 'Timeline for Each Activity Measure
3. Activity Measures/Goals and Objectives and Timeline for Each Activity Measure
ACTIVITY T51ELINE
Purchase Properties - 4 November through January
♦ General Notice Letter
♦ Property Inspections
♦ Environmentals
Rehabilitate Properties
♦ Work Specifications
♦ Bid Work
♦ Rehabilitate Property
Lease Properties Prospective Buyers
♦ Verify Client's Income
♦ Execute Lease /Purchase Agreement
Maintain Properties While Leased
♦ Insurance
♦ Maintenance
Sell Property to Prospective Buyer
♦ Provide Forgivable Grant for
Down Payment And Closing Cost
♦ Homebuyer Agreement for Affordability
♦ Guidelines
♦ Transfer Ownership to Leaseholder
February through May
June through August
June and Ongoing for up to a
two-year period
January 2006 and Ongoing
for up to a two-year period
D. EVALUATION
4. Evaluation
Community Housing Resource Board of Lubbock (CHRB) will evaluate the project by
maintaining records that will:
1. Describe each activity undertaken.
2. Demonstrate that each activity undertaken meets the eligible activities under the HOME
Program
3. Document the acquisition, improvement, use and disposition of real property.
4. Document compliance with the fair housing and equal opportunity components of the
HOME program.
5. Document that financial records as required by HUD is in compliance with HUD
regulations.
6. Document that the project meets the requirements of period of affordability.
7. Demonstrate client eligibility for services provided.
E. PROGRAM INCOME
1. Program Income
Anticipated Program Income and Return of Investment to Grantor:
The anticipated program income for a year will be as follows:
$400 X 4 Houses X 12 = $ 19,200 (Rent) - $13,000 (Expenses) _ $6,200
The Return of Investment to the City is as follows:
25% of $174,750 = $ 43,688. CHRB proposes to payback to the City $364 per
month ($ 4,361 yearly) for 10 years at 0% once the project is completed (when
all the houses funded by the proposed project are sold) or a lump sum of $43,688
when the last house funded by the project is sold.
Page 6
G. PROJECT BUDGET
1. Please list applicant's anticipated expenditures, detailing requested funds and applicant's matching
funds. Please place C==Cash, S= Sweat Equity, Other Grants, D=Donations beside each amount
under "Applicant's Match" to denote the type of match being used.
ADMIIOSTRATION:
Personnel #
PayroH Taxes
EMPIOYW Benefits
Office Supphes
COPY lies
Postage
To hone
Promotional
Professional Service
Vehide Fuel/Mileage
Other.
PROGRAM:
AcquWdon
$105,000
$26,250 (0)
$131,250
Recoa UuCtiion
RehabUiiadon
69,750
17,438 (0)
87,188
Installation
Demolition
T ech. Asst.
Direct Assistance
Rental of Space
Rental of Bquhmmg
Professional Sesvfces
for Clients
Other:
Professional services
Construction
TOTAL4
$174,750
$43,688 (0
$218,438
H. APPLICANT INFORMATION
1. Capacity of Organization
Community Housing Resource Board of Lubbock (CHRB) is an established organization
committed to helping the low to moderate -income population in the City of Lubbock and the
South Plains region. CHRB's mission is to make homeownership accessible to the low to
moderate income individuals of targeted areas and provide affordable rental for those unable to
purchase a home. It keeps its programs and activities focused on the needs of the said targeted
group. It enjoys success with its programs in making homeownership a reality and maintaining
its operations fiscally sound.
CHRB is a 501 (C) (3) non-profit organization established in 1985. Initially, it was funded by
the U.S. Department of Housing and Urban Development (HUD) as an agency whose mission
was to hear and file housing discrimination complaints.
Since 1993, CHRB redirected its service to housing programs funded by the City, State and
Federal Government as well as private foundations. In 1994 it was certified as a Community
Housing Development Organization (CHDO) by the Texas Department of Housing and
Community Affairs and also by the City of Lubbock. Today it enjoys partnerships with local
financial institutions in an effort to create accessible housing for the low to moderate income
individuals by offering lower interest rates and less stringent methods of financing, thereby
making it easier to secure a loan.
CHRB has successfully implemented and continues to implement unique housing programs. The
Lease/Purchase program is one that gives families in the low to moderate -income range, the
opportunity to become homeowners. To date, it has acquired thirty houses, rehabilitated twenty-
six of them, four are being written up for rehabilitation, seven are leased to prospective
homeowners and twelve have been sold. Families are pre -qualified before they occupy the
houses. This program is designed to help those that have credit problems that can be fixed, too
much credit that must be reduced, not enough job stability or no funds for down payment and
closing costs. As an incentive for participants to complete the program, CHRB provides down
payment and closing costs assistance in an amount up to $2,500.00 depending on how long they
lease the property. CHRB is in the process of purchasing an additional five houses or more that
will be, rehabilitated, and occupied in the very near future.
An eight -unit apartment complex was acquired with HOME funds and with a loan in 1995 and in
1997 it was completely rehabilitated with HOME funds. Individuals must be in the 50% - 60%
of area median income to qualify for these apartments. CHRB manages and maintains the
complex.
In the New Construction Program, ten houses have been completed, nine have sold, and four lots
have been acquired in order to build more new houses. All houses have been or will be built in
targeted areas as designated by the City Council.
Other programs administered in the past by CHRB were the Down Payment and Closing Cost
.f
Direct Assistance Program in which 40 families achieved homeownership, the Emergency
Shelter Grant Program (2 years of funding), HUD Mortgage Counseling Program (2 years of
funding), and the Slaton Rehabilitation Program for the elderly (9 houses @ $25,000 each.)
CHRB was funded for affordable handicapped accessibility housing. Construction will begin in
the near future. Management and maintenance will be similar to the Elderly Housing program.
As of fiscal year ending September 30, 2004, CHRB had $2,006,206 in assets, $36,415 in
liabilities, and $2,042,621 in fund balance. During the same fiscal period, CHRB had $282,351
in grant support, and $68,384 in other revenue for a total of $350,735 in total support and
revenue. For 2004-2005, CHRB's expected operations budget is $150,000, which will cover
personnel, utilities, and general operation expenses. There are two positions allocated. The
agency also contracts with a grant writer, Paul Watson, and a Rehab Specialist, Wally McNeil,
Raul Alvarado with Century Small Business Solutions, and receives assistance from board
members, community individuals, and Texas Tech University Small Business Development
Center (SBDC). Williams, Rogers, Lewis Company, . PC, a certified public accountants firm,
conducts an annual independent audit in accordance with generally accepted auditing standards
and government auditing standards. The audit is comprehensive and covers financial, internal
control, and compliance report sections.
ia. STAFFING
2. Staffing:
CHRB is governed by a seven -member Board of Directors with diverse backgrounds in terms of gender,
race, city residency, and profession. CHRB utilizes personnel and professionals in accomplishing the
work of the office including hiring personnel, training, clerical work, recording and data entry,
submitting grant funding requests and administering contracts. CHRB currently has an executive
director, and a bookkeeper. Additionally, CHRB utilizes the services of Raul Alvarado with Century
Small Business Solutions, a business consultant specializing in accounting and bookkeeping, a grant
writer, Paul Watson, and Wally McNeil, a Rehab Specialist, who prepares the rehab write-ups and bids
and does inspections on all on -going projects.
Maggie Trejo was hired by Community Housing Resource Board (CHRB) in January, 1995 as a Housing
Specialist. In October,1996 she assumed the post of Executive Director. Mrs. Trejo has been successful
in acquiring community development funding, has built 10 new homes and is working on building others.
In addition, Mrs. Trejo has rehabilitated twenty-one existing homes, an 8-unit apartment complex and a
6-unit complex for the -elderly and is currently working on constructing a 4-unit complex for the
handicapped. She has received extensive training from the Neighborhood Reinvestment Training
Institute, Community Revitalization Training Center, Texas Department of Housing and Community
Affairs and The Development Training Institute, in topics such as Raising Operating Funds, Managing
New Construction, HUD CHDO Texas Project Development Program, Advance Project Development
Program., Design and Specification for Rehab Specialists, How to Finance Affordable Housing, and
other related training.
Mrs. Trejo earned a Bachelor of Business Administration (Management) from Texas Tech in 1979. She
is a licensed real estate broker and certified Homebuyer Education trainer.
Executive Director - Job responsibilities: Administer projects and programs. Adhere to and interpret all
federal HUD regulations. Prepare annual budgets and funding request proposals. Supervise personnel,
construction, and rehabilitation projects including: New Construction, Lease/Purchase Programs, Rental
Housing, Management of Apartments and Execute Real Estate Contracts. Qualtflcations: Education and
experience equivalent to Bachelors degree in business administration, public administration, or a close
related field. Experience of increasingly responsible administrative and management experience
involved in the development, planning, funding, implementation, and operation of housing programs.
Communication skills. Examine, verify, and analyze financial information, reports and statements. Have
kdowledge of research procedures and techniques. Work effectively with people from a variety of social,
economic, and racial backgrounds.
Bookkeeper - Job responsibilities: Perform general office duties: schedule appointments, provide
general program information, type letters, reports, etc., greet the public, accept rent payments, prepare
statements and receipts, and file. Inspect rental housing and lease purchase properties, prepare list of
repairs for maintenance man, conduct credit and criminal checks for prospective rental housing
applicants and prospective homeowners. Pay monthly bills, keep general ledger for petty cash funds, and
compile expenses that are on going and turn in for reimbursement, with the guidance of the director.
Qual ftcations: Operate a variety of office equipment. Attend workshops and classes to improve skills.
H. REPORTING CAPABILITIES
3. Reporting Capabilities:
Community Housing Resource Board of Lubbock (CHRB) utilizes the following methods in
reporting its activities and finances on a daily, monthly and yearly basis:
1. Uniform HUD forms to report the project set-ups and
close outs.
2: Provide financial reports to private foundations.
3. QuickBooks Pro software for normal accounting activities and reporting
performed in-house by the bookkeeper supervised by the Executive
Director.
4. Annual audit performed by a certified public accounting firm.
•
Page 8
L Conflict Of Interest
Federal law (24CFR570.611) prohibits persons who exercise or who have exercised any functions or responsibilities
with respect to the above grants... or who are in a position to participate in a decision making process or to gain
inside information with regard to such activities, may obtain a financial interest or benefit from an assisted activity...
either for themselves or those with whom they have family or business ties, during their tenure or for one year
thereaft.
Is there any member of the applicant's staff member of the applicant's Board of Directors, or officer who
currently is or has/have been within one year of the data of this application a City employee, a member of the
Community Development & Services Board, or a member of the City Council?
❑ Yes Q No
If yes, please list names:
2. Will the funds requested by the applicant be used to pay the salaries of any of the applicant's staff or award a
subcontract to any individual who is or has been within one year of the date of this application a City employee,
a member of the Community Development & Services Board, or a member of the City Council?
❑ Yes ® No
If yes, please list names:
Is there any member of the applicant's staff, member(s) of the Board of Directors, or officer(s) who are business
partners or immediate family of a City employee, a member of the Community Development & Services Board,
or a member of the City Council?
❑ Yes ® No
If yes, please list names:
If any member of the Community Development Services Board has a conflict, they may not participate in the
sub -committee interview or discussions, nor vote during the recommendation.
The applicant certifies to the best of his/her knowledge and belief that the data in this application is true and correct
and that the governing body of the applicant has duly authorized the filing of the application and that the applicant
will comply with all the requirements of each grant respectively if the application is approved.
Please include: 1) the minutes of the board meeting at which this item was authorized, and 2) who is authorized to
sign the application and/or contracts.
Name: D A. Smith
Signature:,_
Title: Board Chairperson Date: March 21, 2005
C
44 Name: Maggie Trejo Signature: el
Title: Director Date: March 21, 2005
1
OX. Swell.
HOME Investment Partnership Program
Certification of Govtrameental Assistance
Date: March 21, 2005
ATTACHMENT 4
Funding Year. 2005 —2006
Applicant: Community Housing Resource Board of Lubbock
Project Address: City —Wide and Targeted Areas
Amount of Home Funds Requested: $174 , 75 0
Number of Units: 4
Page 13
Please list any governmental assistance, that is now provided or will be provided in the future on this
project, and attach supporting documentation. Govermnental assistance includes any loan, grant
(including Community Development Block Grant), guarantee, insurance, payment, rebate, subsidy,
credit, tax benefit or any other form of direct or indirect assistance from the Federal, State or local
government for use in, or in connection with the project listed above.
Source of Assistance
Amount of Assistance
Eligible Time Period
None
I Maggie T r e j o hereby certify that the information contained in this document is true
anA accurate. ,1
ecutive Director
and
March 21, 2005
Date
BEFORE me, the undersigned, a Notary Public in and for the said County and State personally appeared
Maggie Trejo of Community Housing Resource Board
of Lubbock
onthis 21st dayof March ff�� 2005