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HomeMy WebLinkAboutR-03-0278CITY OF MIAMI, FLORIDA I V5 INTER -OFFICE MEMORANDUM TO: The Honorable r and Jibers of e City Commi i n 70k FROM: iola anager RECOMMENDATION: DATE : MAR 1 3 2003 FILE: 29thYear CDBG Funds — SUBJECT: Housing Development Policy City Commission Agenda REFERENCES: March 27, 2003 ENCLOSURES: It is respectfully recommended that the City Commission adopt the attached Resolution, with attachment, approving the policies related to the Housing Development category of the 29th Year Community Development Block Grant (CDBG) Program and the HOME Investment Partnerships (HOME) Program. BACKGROUND: Under the entitlement formula, the U.S. Department of Housing and Urban Development (U.S. HUD) has advised the City that the projected 29th Program Year entitlement for Community Development Block Grant (CDBG) Program will be approximately $10,132,000 and for HOME Investment Partnerships (HOME) Program will be approximately $5,140,914. Approximately $2,003,600 in 29th Year CDBG Program funds is earmarked for the Housing Development category and $3,855,685 in HOME Program funds is earmarked for homeownership activities. The Administration recommends that the City Commission establish a policy for funding housing development actipities with the 29th Year CDBG and HOME Programs that continues to encourage public/privates, partnerships through the Request for Proposal (RFP) process. To provide focus to the competitive RFP process, the Administration recommends that proposals for 29th Year CDBG Program funding of housing development activities and HOME Program funding of homeownership activities be limited to programs designated as a District priority, according to the chart below. District Priority Activities District 1 - (1) Down payment Assistance / Second Mortgage (2) New Construction, Homeownership District 2 - (1) New Construction, Homeownership (2) Down payment Assistance / Second Mortgage District 3 - (1) Down payment Assistance / Second Mortgage (2) Multi -family Rehabilitation (3) New Construction, Homeownership District 4 - (1) Multi -family Rehabilitation (2) Down payment Assistance / Second Mortgage (3) New Construction, Homeownership District 5 - (1) New Construction, Homeownership (2) Down payment Assistance / Second Mortgage 03. 278 Housing is one of the funding priorities set forth in the City's Action Plan for the 29h Program Year. It is recommended that the City Commission continue the policy of directing 75% of HOME Program funds for Brick and Mortar housing development activities to new construction of homeownership units and 25% to rehabilitation and new construction of rental housing. Under this scenario, there will be a single RFP published for 29t` Year CDBG and HOME Program funding covering the activities designated above by District. Housing administrative costs on Brick and Mortar activities of affordable housing projects will be covered through developer fees of funded projects, thereby eliminating the use of U.S. HUD funds for housing administration. Priority will be given to Community Housing Development Organizations (CHDOs) and projects identified in the City's Five -Year Consolidated Plan in the Homeownership Zones for all funded activities. Funding of down payment assistance and second mortgages must be project -driven. New construction of homeownership projects and projects requesting down payment assistance and second mortgages will be considered in all Districts. Multi -family Rehabilitation projects will be considered only in District 3 and District 4. For a project to be eligible for funding, construction must be ready to begin within six (6) months of executing an agreement with the City and the project must be able to be completed within twenty-four (24) months of executing the agreement. Brick and Mortar housing development proposals submitted outside the RFP process seeking gap financing due to unforeseen cost overruns for projects which are consistent with the City's Action Plan and policy may be considered for funding pending availability of funds from other projects which have been deobligated or which are suffering significant delays. Current procedure, as per the settlement of the Audit Report issued by the Office of the Inspector General March 27, 1998, requires funding approval of all housing development projects by the Housing and Commercial Loan Committee. The Administration further recommends continuing the policy that requires developers to leverage City funds using other public and/or private funding at a minimum of 5:1 for rental housing projects and 3:1 for homeownership projects, as per Resolution No. 98-587, adopted by the City Commission on July 9, 1998. The down payment assistance and second mortgage programs for CDBG and HOME funding will be project -driven. The maximum funding per eligible home purchase will be $25,000. Eligibility and repayment terms will be based current structure for the City's State Housing Initiatives Partnership (SHIP) Homebuyer Financing program, except where CDBG or HOME Program requirements are more restrictive. Loans made through this program are due at payable at time of refinancing, sale or in the event that the property is leased or rented during the term of the loan. The interest rate will be based on homebuyer income, as per the chart below: Income Interest M of Area Median Income) Term of Loan Rate At least 50% but less than 55% Up to 15 years 07. At least 55% but less than 60% Up to 15 years 1% At least 61% but less than 70% Up to 15 years 2% 03- 278 It is recommended that the City Commission adopt the attached Resolution, with attachment, providing policy direction related to the Housing Development category of the 29`x' Year Community Development Block Grant (CDBG) Program and HOME Investment Partnerships (HOME) Program homeownership activities. The proposed Resolution does not have a budgetary impact on the General Fund. 03- '-'278 NOTICE OF 'ELIC HEARING RELATING TO COMMUNI fY DEVELOPMENT ISSUES f••�so.no�� H ' L� i The Miami City Commission will hold a Public Hearing to discuss issues relating to the Community Development Block Grant Program (CDBG) and other HUD programs. The Public Hearing will be held: Thursday, March 27,2003,3:00 p.m. City of Miami Commission Chamber 3500 Pan American Drive Miami, Florida The City Commission Meeting Agenda will include the following items relating to the CDBG Program: 1. Discussion and proposed resolution approving the policies related to the Housing Development category of the 29th Year CDBG Program and the HOME Investment Partnership (HOME) Program_ 2. Discussion and proposed resolution approving the policies related to the Economic Development category of the 29th Year CDBG Program. 3. Discussion and proposed resolution approving the policies related to the Public Services category of the 29th Year CDBG Program. 4. Discussion and proposed resolution directing the allocation of $10,140,000 of the 29th Year CDBG Program funds and $1,000.000 of program income to support City municipal services and related activities for the 29th Program Year. 5. Discussion and proposed resolution allocating $440,000 of Fiscal Year 2003- 2004 Emergency Shelter Grant (ESG) funds by specifically allocating $426,800 to be offered through the Request for Proposals (RFP) process and $13,200 for the Administration of grant related activities. 6. Discussion and proposed resolution allocating CDBG funds from the District 5 Little Haiti Job Creation Pilot Project set-aside in the amount of $90,000 to Super Kids Christian Day Care, Inc., $90,000 to Tender Loving Christian Day Care Center Inc. and $90,000 to Webennan's Traditional Foods, Inc. in the form of five (5) year deferred, forgivable loans with the provision that the funds be used to create and maintain new employment opportunities for residents of the Little Haiti neighborhood for a period of five (5) years. 7. Discussion and proposed resolution certifying that the rehabilitation of the Little Haiti Community Center located at 181 N.E. 82nd Street in the Little Haiti neighborhood and the new construction of a 16 -unit affordable rental housing project located at 6601 N.E. Miami Place in the Little Haiti neighborhood, as completed and as proposed to be developed, respectively, by Little Haiti Housing Association, Inc. are consistent with the Five -Year Consolidated Plan (1999-2004). 8. Discussion and proposed resolution reallocating 28th Year CDBG funds in the category of Historic Preservation in the amount of $75,000 from the City of Miami Planning Department — Historic Preservation Activities to City of Miami Retired Police Officers Community Benevolent Association, Inc. 9. Discussion and proposed resolution amending Resolution No. 02-1133, adopted at the City Commission Meeting of October 10, 2W2, relating to the allocation of $2223,400 of 28th Year CDBG Program funds in the Economic De�relopmant category and amending Resolution No. 02-775, adopted July 8, 2002, relating to the allocating of $1,117,500 of 28th Year CDBG Program funds in the Housing Development category, by transferring District 1 funds in the amount of $50,000 from the District 1 Economic Development Pilot Projects reserve fund in the category of Economic Development to Allapattah Business Development Authority, Inc. in the category of Housing Development for the 28th Program Year beginning October 1, 2002. 10. Disarssior and proposed resolution amending Resolution No. 99-204, adopted March 23, 1999, which appointed the City's Housing opportunities for Persons with AIDS ('HOPWA") Program administrator to serve as a voting member of the Miami -Dade HIV/AIDS Partnership and the Director of the Department of Community Development, or designee, to serve as an alternate member, by changing said appointments such that the Director of the Department of Community Development, or designee, is appointed to serve as a voting member of the Partnership and the Assistant Director of the Department of Community Development is appointed to serve as an alternate member. Interested individuals are encouraged to attend this Public Hearing. The meeting site is accessible to the handicapped. No. 09842) ramr r. rain n tnw www.lherald.corn The Herald N ■ 03- 278