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HomeMy WebLinkAboutResolution - 1739 - Grant Application - HUD - 1984-85 Rental Rehabilitation Grant Program - 06/28/1984J MG:js RESOLUTION 1739 - 6/28/84 RESOLUTION BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: SECTION 1. THAT the Mayor of the City of Lubbock is hereby authorized and directed to execute and submit for the City of Lubbock a Federal Rental Rehabilitation Grant Program Application for the year 1984 and 1985 and related documents, which application attached herewith, shall be spread upon the minutes of the Council and as spread upon the minutes of this Council shall constitute and be a part of the Resolution as if fully copied herein in detail. Passed by the City Council this 28th day of June , 1984. ` - ALAN RENRY, MA OR ATTEST:~ City Secretary=Treasurer APPROVED AS -T0 CONTENT: Sandy Ogletteepitommunity Development Coordinator APPROVED AS TO FORM: Kjk,KeIe-,"G11sar, Assistant City Attorney RESOLUTION 1739 - 6/28/84 OMB Approval No. 29-80218 I FEDERAL ASSISTANCE 2. APPLI- a. NUMBER S. STAT CANT'S APPLTION L OTFPEGT PREIIPPLICATION APPLI� b. DATE IDENTi- Yew month day AC'rtart •p(I .APPLICATION .CATION 19 FIER a. NUMBER SAI -TX -1010201 6. DATE Year month day ASSIGNED 19 6. FEDERAL EMPLOYER IDENTIFICATION NO. 75-6000590-W 6. Mark sip, ❑ KOTIFICATION OF INTENT (Opt.) [] REPORT OF FEDERAL ACTION Lm,. Blank a. a. NUMBER_ 4. LEGAL APPLICANT/RECIPIENT L TITLE a.Applicant Rues City of Lubbock DDiDisf�d b.OreanlatimUnit Community Development Department Rental Rehabilitation a. Street/P.O. Box P.O. Box 2000 Grant d. City ., OWaa : Lubbock L State Lubbock Purpose I= S. ZIP US: 79457 {strict L Coated Penin 1Name Texas 18. ESTIMATED DA MITTEDTTO Year swona day FEDERAL AGENCY ► 19 84 07 O1 & tdevhoae No.) It. Tam= s oD 7. TITLE AND DESCRIPTION OF APPUCANTS PROJECT � ❑ El 1984-85 Rental Rehabilitation Grant Program a. NUMBER SAI -TX -1010201 6. DATE Year month day ASSIGNED 19 6. FEDERAL EMPLOYER IDENTIFICATION NO. 75-6000590-W 6. A -State PRO. a. a. NUMBER_ I- Nigbar Educational Institution !-Indian Tribe L TITLE rom DDiDisf�d Federal Rental Rehabilitation Catalog) Grant 8. TYPE OF APPLICANT/RECIPIENT A -State H -Community Action Agency 114atarstats I- Nigbar Educational Institution !-Indian Tribe 13. PROPOSED FUNDING 14. CONGRESSIONAL DISTRICTS OF: K-0ther (Specify): DDiDisf�d a. AP CANT ytI) E -City b APPLICANT .00 F -School Dishld 16. PROJECT START DATi ]j�gr trloktk �gy Purpose I= d. LOCAL .00 {strict Eater a appropriate Utter 9. TYPE OF ASSISTANCE A4lWc Cent D-insursaa 1114UPptemental Great E -Other Enter sppro- C-Loan priate Utkr(41) 38. FEDERAL AGENCY A-05 ACTION 524-101 a. U tating Shout action. any comments escow from clearlogc�s were ton. b. FEDERAL AGENCY A45 OFFlCIAL it 6. 1 11 agency responaa Is due wKW prorisioa of Part 1. CUB Circular A-95, (Nacos and gUphone so.) N bas been or Is being Suds. 524 PACE ll (10-75) aDemest Circular 10. AREA OF PROJECT IMPACT (Nomer of cities, oanstise. Sta Stan, ate.) City of Lubbock 11. ESTIMATED NUM- BER OF PERSONS BENEFITING 173, 449 12. TYPE OF APPLICATION A.Mew C -Revision E4kugmentation 8-Ranswal D-0Continuation (� Extra. appropriate Uttar U Housing and Urban Development Fort Worth, Texas 76113 13. PROPOSED FUNDING 14. CONGRESSIONAL DISTRICTS OF: 35. TYPE OF CHANGE (For Ito or Its) A -Decease Dollars F-0tMr (specify) _ ��° Dollars C-isewew Derstion D-0ecrasss Duration E -Cancellation Pr iste letter(A) a. FEDERAL i 140 800 .D0 a. AP CANT ytI) b, ►RD1Epj _19tn b APPLICANT .00 e. STATE .Q0 16. PROJECT START DATi ]j�gr trloktk �gy 17. PROJECT DUijl{ ! wontha d. LOCAL .00 APPLICANT CERTIFIES a OTHER 00 18. ESTIMATED DA MITTEDTTO Year swona day FEDERAL AGENCY ► 19 84 07 O1 19. EXISTING FEDERAL IDENTIFICATION NUMBER B -83 -MC -48-0022 It. Tam= s oD 38. FEDERAL AGENCY A-05 ACTION 524-101 a. U tating Shout action. any comments escow from clearlogc�s were ton. b. FEDERAL AGENCY A45 OFFlCIAL it 6. 1 11 agency responaa Is due wKW prorisioa of Part 1. CUB Circular A-95, (Nacos and gUphone so.) N bas been or Is being Suds. 524 PACE ll (10-75) aDemest Circular ZM FEDERAL AGENCY TO RECEIVE REQUEST (Name, City, Stag, 81P aods) 21. REMARKS ADDED Housing and Urban Development Fort Worth, Texas 76113 r] Yes CX No 22. a. To the best at my knowledge and balid. data In this 6. N rrppuirad by OMB Circular A-95 this application was submRMd, pursuant to In. No re- Reeponae structtone therein, to THE prappilation/apptiation ars hon and cornet. the document has been appropriate clearinghouses and all responses are attached: sponee attached APPLICANT CERTIFIES duly authorized by the governing body of the apptiant and the applicant will empty �) ❑ ❑ THAT ► with the attached assurances N the taslst- � ❑ El Is approved. CJ) 13❑ 13 23. a. TYPED NAME IUCD TITLE 6. SIGMA e. DATE SIGNED EYING Alan Henry, Mayor Year snena day Rc SEN TATNE 19 24. AGENCY NAME 25. APPLICA• Year month day TION - RECEIVED 19 25. ORGAN12ATiONAL UNIT 27. ADMINISTRATIVE OFFICE 28. FEDERAL APPLICATION IDENTIFICATION 29. ADDRESS 30. FEDERAL GRANT IDENTIFICATION 3L ACTION TAKEN 32- FUNDING Year swath day 34. Year wwath day FEDERAL i Jen a AWARDEDa. 33. ACTION DATE ► 19 STARTING DATE 19 E3b. RE1ECfED b. APPLICANT .00 35. CONTACT FOR ADDITIONAL INFORMA- TION (Name and Ildephoas ssrmber) 36. Year month day e. STATE .00 Q a. RETURNED FOR ENDING DATE 19 d- LOCAL ,00 37. REMARKS ADDED AMENDMENT 0 d. DEFEASED a. OTHER .00 1. TOTAL S AO e. WITHDRAWN I E3Yas t]No 38. FEDERAL AGENCY A-05 ACTION 524-101 a. U tating Shout action. any comments escow from clearlogc�s were ton. b. FEDERAL AGENCY A45 OFFlCIAL it 6. 1 11 agency responaa Is due wKW prorisioa of Part 1. CUB Circular A-95, (Nacos and gUphone so.) N bas been or Is being Suds. 524 PACE ll (10-75) aDemest Circular �I 4 �ot RENTAL REHABILITATION PROGRAM The City of Lubbock is applying for $140,800 from the Department of Housing and Urban Development for the Rental Rehabilitation Program. This program was authorized under Section 17 of the United States Housing Act of 1937 which was enacted into law in Section 301 of the Housing and Urban -Rural Recovery Act of 1983. The City of Lubbock is a direct grantee of the program as based on the funding formula as established by the regulations. The following is a description of the program as designed by the City of Lubbock. I. PROGRAM OVERVIEW The Rental Rehabilitation Grant Program will be utilized for the rehabi- litation of real property to be used for primarily residential rental purposes. It is proposed that approximately 28 units will be assisted by this program. The objectives of the Rental Rehabilitation Program for the City of Lubbock are: - To increase the stock of standard rental units for low -to -moderate income tenants; - to involve private sector lender to a significant degree in. project financing; - to limit public subsidy to only the amount necessary to make a project feasible; - to avoid any rent controls and to have rehabilitated properties rent for market rents as defined by the public sector. The City of Lubbock will provide assistance to rental property owners to encourage. the rehabilitation of property that might otherwise not be economically feasible to repair. The Rental Rehabilitation Program will be jointly conducted by the City of Lubbock's Community Development Department and the Lubbock Housing Authority. A Memorandum of Agreement which outlines the willingness of the Lubbock Housing Authority to administer the Section 8 Certificate program in conjunction with the Rental Rehabilitation Program is attached. (Exhibit A) II. PROJECT FINANCING Projects will be financed through a combination of Rental Rehabilitation loan funds, private lender funds, and owner's equity. The amount of City funds provided will be determined after a review of the project income/ expense statement. The amount of public subsidy shall not exceed 50% of the total cost of the rehabilitation and the amount of rental rehabi- litation for any project shall not exceed an average of $5,000 per unit. -1- 8 The.minimum public subsidy shall not be less than an average of $600 per unit per project. The loan amount from the private lender will be determined by the lender using its own underwriting criteria. The City's loan will be structured as a no -interest deferred loan which is forgiveable at the end of ten years. If the property owner does not comply with the guidelines of the program, the loan becomes immediately due and payable. The following conditions must be met to be in full compliance of the program: a) The property must be maintained as a residential property, which is leased or rented to members of the public for resi- dential purposes. b) The property must be maintained in a safe and sanitary condi- tion and in compliance with all City of Lubbock Building, Plumbing, Electrical, and Mechanical Codes. c) The property may not be converted to condominium ownership or any form of cooperative ownership. If each of these conditions is complied with for a period of ten years, then the public subsidy loan will be forgiven. A mechanics lien will be filed on each accepted project, and the condi- tions of the Rental Rehabilitation program will be reviewed annually for compliance. III. ELIGIBLE REPAIRS The rental rehabilitation loan may be used for repairs necessary to meet the; a) basic health, safety, and fire standards contained in the City of Lubbock's Building, Plumbing, Electrical, and Mechanical Codes, b) the Section 8 Housing Quality Standards and, c) the cost-effective energy requirements. A limited amount of non -code repairs will be allowed in rehabilitating the structure. The cost of non -code repair will not exceed 10% of the total cost per unit of a project. IV. NEIGHBORHOOD SELECTION, NEIGHBORHOOD PRESERVATION AND LOWER INCOME BENEFIT The City of Lubbock's Planning Department recently completed the Neigh- borhood Statistics Program for the City. This information will assist in the neighborhood selection process. The Neighborhood Statistics Program compiled information on the income, racial, and housing characteristics of the neighborhoods. -2- -Thetarget neighborhoods for the program will be within the current .Community Development Target Area. This area is limited to neighborhoods where the median income of the residents is 80% of the City's median income or less. Only projects which are located in a low income neigh- borhood will be assisted in the Rental Rehabilitation Program. The City anticipates the impact of this program on neighborhood preserva- tion to be positive. During the preparation of the City's Housing Assistance Plan, the lack of available decent, safe, and sanitary units in the rental market became acutely apparent. This program will assist the City in its goal of stabilizing neighborhoods and in increasing the number of available rental units. Other factors which will be considered during the neighborhood evaluation are: median income, median rent levels, the historical trend of the area, current and projected land use, and current housing stock conditions. With each of these considerations, a rapid increase in the rent levels in the selected neighborhoods is not anticipated. A market analysis of targeted neighborhoods will be conducted which assesses the current rent structure and vacancy rates in preliminarily selected neighborhoods. At this time, the city of Lubbock has not finalized the neighborhood or project selection process. For this reason, the City is requesting a 70% lower benefit guideline. This guideline will minimize displacement of existing tenants in projects to be rehabilitated and will provide a reasonable margin of error during project or neighborhood selection. To further insure the City's compliance with the lower income benefit guideline, the City's project selection criteria will favor properties that are occupied by Section 8 eligible tenants or properties which are vacant at the time of applicant submission. The City of Lubbock will require that the project applicant provide information pertinent to the determination of Section 8 eligibility for existing tenants. This information will be required upon application to the Rental Rehabilitation Program. This information will be utilized during the evaluative process and to assist the City in compliance with the lower income benefit guidelines. This information will also be utilized in assessing the tenant for inclusion in the Section 8 Certifi- cate Program and in calculating potential relocation benefits. Potential tenants for the available or vacant rehabilitated units will be selected from the City of Lubbock's Section 8 waiting list. By defini- tion, tenants selected from this list who are eligible for Section 8 assistance will be lower income. Additionally, the City of Lubbock's project selection criteria will place a higher priority on properties occupied by very low income persons. The very low income guideline is 50% of the City's median income or below. MI! V. •LARGE FAMILY AND VERY LOW INCOME EMPHASIS The Rental Rehabilitation Program is placing a major emphasis on the rehabilitation of units with two or more bedrooms. These larger units are to be occupied by large families. The City of Lubbock will encourage the rehabilitation of large family units by allocating only 30% of the Rental Rehabilitation Grant funds for one bedroom units. The City of Lubbock's project selection criteria will place a higher priority on properties occupied by very low income persons. VI. SELECTION OF PROJECTS Each project will be reviewed according to criteria which includes the following: a) The project is consistent with the objectives of the Rental Rehabilitation Program. b) The private funds and owner's equity are sufficient to complete the financing of the project. c) The location of the project is consistent with the low and very low income guidelines and is in a targeted neighborhood. d) The condition of the property is substandard, and it can be rehabilitated to meet local codes with the available financing, both public and private. e) The level of displacement is minimal. f) The project contains the targeted number of one and two bedroom, or larger units. A cash-flow analysis for each project will be completed to determine the financial feasibility of the project and to minimize the level of public subsidy required for each project. This is also essential in evaluating the rent reasonableness after rehabilitation of the unit. The City of Lubbock's agreement with the selected property owners will formalize the owner's agreement to comply with the program guidelines. If the property is not maintained and operated with rents at the levels originally proposed, the City has the option of calling the lien due in full. VII. IMPLEMENTATION SCHEDULE FOR RENTAL REHABILITATION PROGRAM Immediately following the grant agreement for the Rental Rehabilitation Program, the City anticipates the following schedule for the dispersement of the available funds. -4- Quarter % of Fund Committed 1 0% 2 25% 3 50% 4 100% VIII. OTHER PROGRAM REQUIREMENTS The City of Lubbock will require all program participants to comply with all applicable nondiscrimination, affirmative marketing and equal opportunity requirements as required by the statute. These requirements will be formalized in the agreement between the property owner and the City of Lubbock. IX. CONTACT PERSON The local contact person is Sandy Ogletree, Community Development Coordinator, City of Lubbock, P.O. Box 2000, Lubbock, Texas 79457. The telephone number is (806) 762-6411, extension 2290. The local contact person for the Lubbock Housing Authority is D.C. Fair, Executive Director, Lubbock Housing Authority, P.O. Box 2568, Lubbock, Texas 79408. The telephone number is 762-1191. -5- CERTIFICATIONS FOR THE RENTAL REHABILITATION BLOCK GRANT PROGRAM The City of Lubbock certifies that: 1. The submission of the program description is authorized under State and local law (as applicable), and the grantee possesses the legal authority to carry out the rental rehabilitation program described therein, in accordance with this part; 2. Its rental rehabilitation program was developed after consultation with the public and its description of program activities referred to in paragraph (b) (1) of this section has been made available to the public; 3. If applicable, its lower income benefit standard should be reduced to 70 percent, as provided by § 511.10 (a) (2); this certification will be accompanied by an explanation of the reason why the reduced benefit standard is necessary, as provided in 6 511.10 (a) (2); 4. A written tenant assistance policy conforming to the requirements of § 511.10 (h) (2) has been adopted; 5. It will conduct and administer its rental rehabilitation program, and, if applicable, ensure that State recipients conduct and administer their rental rehabilitation programs, in conformity with the requirement of § 511.10 (m); 6. It will conduct and administer its rental rehabilitation program and, if applicable, ensure that State recipients conduct and administer their rental rehabilitation programs in accordance with the requirements.of this part. nreni ►TION 173.0 - Mr. I.L. Sanchez - Davis Acting Regional Administrator Department of Housing and Urban Development Fort Worth Regional Office 221 West Lancaster Avenue P.O. Box 2905 Fort Worth, Texas 76113 Dear Mr. Sanchez - Davis: 762-6411 P. O. Box 2000 6/28/ i A-JBBCCK LUBBOCK, TEXAS 79457 June 1, 1984 This letter serves as a statement of cooperation between the City of Lubbock and the Lubbock Housing Authority (LHA) in the Rental Rehabilitation Block Grant Program. This Statement is submitted as a part of the City of Lubbock's application to the Rental Rehabilitation Program as required by Section 511.20(13)(i) of the program guidelines. The City and the Housing Authority have a central goal of preserving the City's existing housing stock and providing decent, safe, and sanitary housing for low and moderate income residents. With this goal in mind, the Lubbock Housing Authority will cooperate with the City in the implementation of the Rental Rehabilitation Program. The Lubbock Housing Authority will assist in the development of the policies and procedures necessary for the effective and efficient operation of the program, and the Lubbock Housing Authority will perform the duties required for the administration of the Section 8 Certifi- cate Program. June 11, 1984 Page 2 If any additional information is needed please contact Sandy Ogletree, Community Development Coordinator, City of Lubbock, (806) 762-6411, extension 2290. Sincerely, J i Simpson Cha rman Lubb k Housing Aut rity Board IanHenry Mayor xc: D.C. Fair, Director - Lubbock Housing Authority Jim Bertram, Assistant City Manager for Development Services Sandy Ogletree, Community Development Coordinator