HomeMy WebLinkAboutR-03-0908J-03-683
07/23/03
RESOLUTION NO. 03— 908
A RESOLUTION OF THE MIAMI CITY COMMISSION,
WITH ATTACHMENT(S), RESCINDING CERTAIN
PROVISIONS OF RESOLUTION NO. 98-588 WHICH
ADOPTED THE ATTACHED HOUSING LOAN COLLECTION
PROCEDURES AND POLICIES IN THEIR ENTIRETY,
INCLUDING THE REQUIREMENT OF APPROVAL BY THE
CITY COMMISSION, U.S. DEPARTMENT OF HOUSING
AND URBAN DEVELOPMENT, AND STATE EMERGENCY
FINANCIAL OVERSIGHT BOARD OF CERTAIN
DELINQUENT LOAN RESTRUCTURINGS OR
STIPULATIONS OF SETTLEMENT AGREEMENT.
WHEREAS, Resolution No. 98-588, adopted June 9, 1988,
adopted the attached Housing Loan Collection Procedures and
Policies in their entirety; and
WHEREAS, the Housing Loan Collection Procedures and
Policies adopted by Resolution No. 98-588 provide that any
proposals regarding multi -family loans delinquent in excess of
120 days requiring restructuring of the loan or stipulation of
settlement agreement require approval by the Miami City
Commission, the U.S. Department of Housing and Urban Development
("HUD"), and the State Emergency Financial Oversight Board; and
WHEREAS, Resolution No. 00-867, adopted September 28, 2000,
rescinded Resolution No. 98-588 in its entirety, and authorized
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CITY COMMIS&LUN'
MEETTiNG OF
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tiasoluiion No.
!33— 908
and directed the City Manager to establish an eleven (11) member
Housing and Commercial Loan Committee to approve/disapprove
certain housing and commercial loans and/or grants to be
provided by the City through the Community Development Block
Grant ("CDBG"), HOME Investment Partnership ("HOME") and State
Housing Initiatives Partnership ("SHIP") Programs; and
WHEREAS, Resolution No. 00-867, adopted September 28, 2000,
granted the Housing and Commercial Loan Committee the authority
to approve or disapprove all loan applications for funding of
affordable housing projects and commercial (business) projects
and related transactions including, but not limited to,
subordination agreements, loan restructuring plans and/or loan
repayment plans in the City's loan portfolio, except for the
authorization provided to the City Manager or designee in
Section 5 of Resolution No. 00-867; and
WHEREAS, in order for the Housing and Commercial Loan
Committee to have the ultimate authority to approve or
disapprove all loan applications for funding of affordable
housing projects and commercial (business) projects and related
transactions including, but not limited to, subordination
agreements, loan restructuring plans and/or loan repayment plans
in the City's loan portfolio, except for the authorization
provided to the City Manager or designee in Section 5 of
Page 2 of 4
03- 908
Resolution No. 00-867, approval of the City Commission should
not be required; and
WHEREAS, the State Emergency Financial Oversight Board has
been dissolved and its approval is no longer necessary; and
WHEREAS, pursuant to direction from HUD and applicable law,
approval of HUD is also no longer necessary; and
WHEREAS, it is in the best interest of the City of Miami to
eliminate superfluous requirements; and
WHEREAS, to accomplish the foregoing, it is necessary to
rescind the provisions of Resolution No. 98-588 requiring
approval by the City Commission, HUD, and State Emergency
Financial Oversight Board;
NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE
CITY OF MIAMI, FLORIDA:
Section 1. The recitals and findings contained in the
Preamble to this Resolution are adopted by reference and
incorporated as if fully set forth in this Section.
Section 2. Certain provisions of Resolution
No. 98-588, adopted June 9, 1998 which adopted Housing Loan
Collection Procedures and Policies in their entirety (attached
and incorporated), including the requirement of approval by the
City Commission, HUD, and State Emergency Financial Oversight
Page 3 of 4
033- 908
Board of certain delinquent loan restructuring and stipulations
of settlement agreement, are rescinded.
Section 3. This Resolution shall become effective
immediately upon its adoption and signature of the Mayor Y
PASSED AND ADOPTED this 24th
ATTEST:
ILLA A. TH MPSON
?� CITY CLERK
APPROVED
KITJObRO VILARELLO
C ATTORNEY
W7425:MJS:BSS
day of July 2003.
f
UEL A. DIAZ, MAY
ECTNESS
�i If the Mayor does not sign this Resolution, it shall become
effective at the end of ten calendar days from the date it was
passed and adopted. If the Mayor vetoes this Resolution, it shall
become effective immediately upon override of the veto by the
City Commission.
Page 4 of 4 s)3— 908
J-98-566
05/15/98
RESOLUTION NO. 9 8
A RESOLUTION, WITH ATTACHMENT, APPROVING THE
CITY OF MIAMI'S HOUSING LOAN COLLECTION
PROCEDURES AND POLICIES IN CONNECTION WITH THE
CITY'S HOUSING LOAN PORTFOLIO CONSISTING OF LOW-
INTEREST LOANS WHICH HAVE BEEN PROVIDED
THROUGH THE CITY'S CDBG-FUNDED SINGLE-FAMILY
AND MTULTI •FAMILY REHABILITATION LOAN PROGRAMS, ,
RENTAL REHABILITATION GRANT PROGRAM, HOME
INVESTMENT PARTNERSHIP PROGRAM AND STATE
HOUSING INITIATIVES PARTNERSHIP PROGRAM;
AUTHORIZING AND DIRECTING THE CITY ATTORNEY TO
COORDINATE A LOAN COLLECTION PROCEDURE WITH
THE DEPARTMENT OF COMMUNITY DEVELOPMENT
WFUCH WILL INCLUDE SENDING CERTIFIED LETTERS TO
ALL DELINQUENT DEBTORS AND TO AGGRESSIVELY
PURSUE ALL LEGAL ACTIONS AND OPTIONS AGAINST ALL
LOAN ACCOUNTS WHICH ARE IN DEFAULT IN EXCESS OF
120 DAYS; AUTHORIZING AND DIRECTING THE CITY
ATTORNEY TO PROVIDE THE CITY COMMISSION WITH
QUARTERLY STATUS REPORTS OF ALL DEPARTMENT OF
COMMUNITY DEVELOPMENT DELINQUENT LOANS
REFERRED TO THE CITY ATTORNEY'S OFFICE.
Wi-itkEAS, in its Audit Report` dated Marchi 26, 1998, the U.S. Department of '
Housing and Urban Development's District Office of the Inspector General ("OIG"), cited several
problems and concerns relative to the City's housing loan portfolio; and
i�ATTAtNMENT (S)
CONTAINED
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JUN 0 9 1998
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WHEREAS, in an effort to address the OIG's concerns with respect to the collection
practice regarding the defaulted loans in the City's loan portfolio, it is necessary that the City
establish a loan collection procedure; and
W HER�AS, it is Tecocnmended by the. Economic Development. and Transportation
Committee that the City Attorney's Office coordinate a collection procedure with the Department
of Community Development which will include sending certified letters to all delinquent debtors;
and
WHEREAS, it is further recommended that the City aggressively pursue all delinquent
debtors which are in default in excess of 120 days, through legal action to safeguard the City's
assets, by initiating foreclosure actions, enforcing the assignment of rents, pursuing per;L
guarantees, and through the engagement of private debt collection agencies; and
WHEREAS, it is recommended by the Economic Development and Transportation
Committee that the City Attorney provide the City Commission with quarterly reports of all
Department of Community Development delinquent loans referred to the City Attorney's Office;
NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY
OF MIAMI, FLORIDA:
Section I._ The recitals and findings contained in the Preamble to this Resolution are
hereby adopted by reference thereto and incorporated herein as if fully set for in this Section.
Section 2. The City Commission hereby adopts the attached Housing Loan Collection
Procedures and Policies, which delineates the roles and responsibilities of the Department of
Community Development and the City Attorney's Office, in carrying out the loan collection
procedure with respect to the City's housing loan portfolio.
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03- 908
Section 3. The City Attorney is hereby authorized and directed to coordinate the
collection procedure with the Department of Community Development, which will include
sending certified letters to all delinquent debtors.
-Section 4.' - The City Attorney .is further authorized and directed to provide the City
Commission with quarterly status reports of all Department of Community Development
delinquent loans referred to the City Attorney's Office.
Section 5. This Resolution shall become effective immediately upon its adoption.
PASSED AND ADOPTED this 9th day of June , 1998.
JOE CAROLLnod ind�c�ie approval of
to SmordMe with Miami Code Sec. 2.36, since the Mayor
j* legislation by signing it in the designated place provided, said legi;iat:c�.:: r
ATTEST: becomes effective with the elapse of ten (10} c�1�:. Orn the data of Commission c .::n
regarft same, without the Mayor "x . ' in
WALTER J. FOEMAN, CITY CLERK wakfirjefoernan, City Clerk
CITY CLERK'S OFFICE
DEPARTMENT OF CONW)NITY DEVELOPMENT
REJ/. W ANf APPROVAL:
GWEND YN C. WARREN, DIRECTOR
DEPARIVENT OF COMMUNITY DEVELOPMENT
03- 908
3 ... _
PREPARED AND APPROVED BY:
LfNIDAMELICY ICRARSON
ASSISTANT CITY =ATTORNEY
APPROVE'.6'AS T6 FORM AND
CORRECTNESS:
TTORNEY
2589
03- 908
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Department of Community
Development/Housing Division
Housing Loans
Collection Procedures and Policies
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DEPARTMENT OF COMMUNITY DEVELOPMENT/HOUSING DIVISION
HOUSING LOANS) COLLECTION PROCEDURES AND POLICIES
In response to the shortcomings and deficiencies which were identified by the District Inspector
General for Audit in the audit report, dated March 26, 1998, the Department of Community
Development will be charged with the sole responsibility of performing the collection activities
associated with the management of various housing loans which have been provided through the
CDBG-funded Single -Family and Multi -Family Rehabilitation Loan Programs, HOME Program,
State Housing Initiatives Partnership Program (SHIP) and any other housing programs which are
administered by the Department. As part of the City's Corrective Action Plan and the
Departmental Reorganization Plan, an in-house Finance Unit will be charged with the day-to-day
responsibility of collections and oversight of the City's housing loan portfolio. This course of
action will eliminate the lack of communications and misunderstandings which may have
occurred in the past, relative to the roles of other City departments, namely, the Finance a Law
departments. =
The Department of Community Development, through its Finance Unit will be responsible for
receiving all loan payments submitted by the borrowers and the initial booking of the payments
received from each borrower. Through the implementation of a mortgage tracking system, the
Finance Unit will be able to determine whether a borrower is current, 30 days, 60 days and 126.
days past due on his/her loan. Appropriate late notices will be forwarded to the borrower, along
with follow-up telephone calls to the borrower(s) to bring the loan current and/or to establish the
problem area associated with the delinquent account.
After a loan is in default for ninety (90) days, the Department of Community Development will
be responsible for notifying the City Attorney's Office to send certified delinquency letters to all
borrowers who are delinquent on their loan account. If the borrower contacts the Department of
Community Development and/or the City Attorney's Office, and is desirous of correcting the
delinquency, no further ligal action will be pursued by the City.
After a loan is in default for 120 days, the Department of Community Development in
conjunction with the City Attorney's Office will continue through appropriate written
correspondences and telephone calls, attempt to notify the borrower(s) to bring his/her delinquent
loan account current or enter into a stipulation of settlement agreement with the City Attorney's
Office. If there is no response from the borrower(s), the Department of Community
Development will be responsible for referring the matter to the City's Attorney's Office for
foreclosure action.
Any multi -family loan(s) that is delinquent in excess of 120 days, and the borrower(s) has
responded to the appropriate notices forwarded by the Department of Community Development
and/or City Attorney's Office and requires a restructuring of the loan or stipulation of settlement
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agreement, will require that the Department of Community Development submit said request to
the City's Housing Loan Committee for approval/disapproval. Such action will also require
approval from the Miami City Commission and U.S. HUD. Once approval has been received
from the City Commission and U.S. HUD, all loan restructuring plans must also receive final
approval from the State Oversight Review Board.
The Department of Community Development will be responsible for performing the appropriate
project analysis to determine whether foreclosure is the proper remedy. This project analysis
will take certain factors into consideration which include:
1. The assessed value of the property.
2. The amount of superior lien holders (i.e., mortgages, tax certificates).
3. The condition of the property and liability associated with same.
4. The cost of maintaining the property.
5. The marketability of the property.
6. The loss in tax revenue once the property becomes exempt.
Should the Department of Community Development decide that foreclosure is econ 'cally
feasible, a Foreclosure Referral will be executed and forwarded to the Office orAsset
Management and the City Manager's Office for approval/disapproval. Once approval has been
sacured from the City Manager's Office, the completed foreclosure referral form will be
forwarded to the City Attorney's Office for legal action against the borrower(s). In the event that
the Department of Community Development makes a determination that it is not economically,
feasible to foreclose and take title to the property, the Department of Community Development .
will refer the case to the City Attorney's Office for other legal remedies which may include a suit
on the promissory note and/or personal guarantees. In addition, in those instances whereby the
City has utilized every available legal remedy to address a defaulted loan account, the City plans
to utilize the services of a private debt collection agency to pursue all funds which remain
outstanding.
The Department of Community Development will be responsible for working with the City
Attorney's Office in tmcking the status of the foreclosure case, from the filing of the complaint,
summary `� . n � °° gme t, f oreclosure sale,; temporary management of the. property(ies; by ;a private <_
management firm, and disposition to a new property owner. A new position, Default/Loan
Workout Specialist will be assigned the responsibilities of monitoring default loans, make
recommendations with regard to payment stipulations and loan workout agreements.
In addition to the foreclosure actions, the City Attorney's Office will be charged with pursuing
all legal remedies to cure loan defaults, to safeguard the City's assets and to recover losses by the
City. These remedies shall include collecting. rents through the assignment of rent agreements,
and pursuing personal" guarantees to recover losses. Moreover, through the utilization of the
City's newly establithed Housing Loan Recovery Fund, the City will make every attempt to
satisfy any superior lien holders which may be ahead of the City's loan, in order to safeguard the
City's asset when possible.
03- 908
The City Attorney's Office will be responsible for the preparation of a quarterly status report on
the status of all legal actions against all borrower(s) for on
to the appropriate
Department, in addition to providing a quarterly status report to the City Commission regarding
the status of each foreclosure case.
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03- 908
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