HomeMy WebLinkAboutcover memoCITY OF MIAMI, FLORIDA
INTER -OFFICE MEMORANDUM
TO
FROM:
The Honorable Mayor and
Members of The Commission
Joe A � la
City �• ager
DATE :
SUBJECT:
FEB 6 2004
HOME Program Housing
Development Policy
REFERENCES : City Commission Agenda
February 26, 2004
ENCLOSURES:
FILE :
RECOMMENDATION:
It is respectfully recommended that the City Commission adopt the attached Resolution,
authorizing the allocation of FY'2004-2005 HOME Investment Partnerships (HOME) funds in
the amount of $1,500,000 to Little Havana Home Ownership Advisory Board for the
development of housing; and further adopting housing development policies, attached and
incorporated, related to the funding of rental and home ownership housing development under
the 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 30`I' Program Year HOME entitlement will be
approximately $5,117,000 for the HOME Investment Partnerships (HOME) Program.
The allocation of $1,500,000 to the Little Havana Horne Ownership Advisory Board represents
the second year of a five (5) year commitment, with each subsequent year's funding source to be
determined at the time of allocation.
The Administration recommends that the City Commission establish a policy that continues to
encourage public/private partnerships through the Request for Proposal (RFP) process. It is
further recommended that the City Commission continue the policy of directing 25% of Brick
and Mortar housing development funds under the HOME Program to new construction of rental
housing and reserving the remaining 75% for homeownership activities.
The Administration recommends that the City Commission approve the below listed allocations
of FY'2004-2005 HOME Program funds:
Little Havana Horne Ownership Advisory Board 1,500,000
New Construction —Rental Projects 776,325
New Construction —Home Ownership Projects 2,328,975
Administration 511,700
Total Allocation $ 5,117,000
It is recommended that funding for the development of rental housing under the HOME
Program, be limited to projects that: (1) need local matching funds from the City to apply for
Housing Credit funding from the State of Florida's Florida Housing Finance Corporation
(FHFC), (2) that are approved for funding by the FHFC, (3) that meet all requirements, including
eligibility requirements, of the applicable RFP and (4) that are approved by the Housing and
Commercial Loan Committee. In accordance with this focus, the timing of the RFP process for
the funding of the rental housing development must be adjusted to enhance alignment with the
State of Florida's RFP process for the allocation of Housing Credit funding. The State requires
submission of applications for Housing Credit no later than March 31, 2004 and allows a thirty
(30) day cure period, during which time the applicant can provide documentation of local
matching from the City.
The Administration further recommends approval of a policy that includes an application fee of
1 % of the total award amount, due and payable to the City of Miami within thirty (30) days of
funding approval by the Housing and Commercial Loan Committee from for -profit developers of
housing development projects. The application fee will be refundable only to rental housing
development projects that apply for, but fail to win, approval for Housing Credit funding from
the Florida Housing Finance Corporation. Failure to pay the application fee in full by the
required date will result in forfeiture of funding approval by the City.
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 a
maximum of thirty (30) 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.
On May 8, 2003, the City Commission authorized a change to leveraging requirements reducing
the 3:1 minimum required contribution of non -City public or private funding to 2:1 for
homeownership projects. The 5:1 leveraging requirement for rental housing projects remained
unchanged.
It is recommended that the City Commission adopt the attached Resolution authorizing the
allocation of FY'2004-2005 HOME funds and further adopting policies, attached and
incorporated, related to the funding of rental and homeownership housing development under the
HOME Program.
The proposed Resolution does not have a budgetary impact on the General Fund.
LMH/BGR