HomeMy WebLinkAboutCover MemoCITY OF MIAMI, FLORIDA
INTER -OFFICE MEMORANDUM
TO :
FROM
The Honorable Iylayor•-and
mbers of;I he City Comiji
7be �rriola
Manager
DATE:
SUBJECT
MAR I 7 2004 FILE
Accepting FY'2003 & FY'2004
ADDI Grants from U.S. HUD
City Commission Agenda
REFERENCES : April 8, 2004
ENCLOSURES:
RECOMMENDATION:
It is respectfully recommended that the City Commission adopt the attached Resolution
accepting U.S. Department of Housing and Urban Development (U.S. HUD) entitlement grants
under the American Dream Downpayment Initiative (ADDI) program for FY'2003 and FY'2004
for use as downpayment assistance in the purchase of single family housing by low-income
families who are first-time homebuyers, to be provided in the form of a deferred, non interest -
bearing, non -amortizing, twenty-year loan to be repaid by the homebuyer in full, in the event that
the home is sold, leased or rented during the twenty-year period; and authorizing the City
Manager or designee to determine whether repayment by the homebuyer is required in the event
of a refinancing of the home during the twenty-year period, on a case by case basis; and
authorizing the City Manager to execute the necessary documents, in a form acceptable to the
City Attorney, to implement acceptance of said grants.
BACKGROUND:
The City of Miami has been advised by U.S. HUD that the projected entitlement amounts under
the American Dream Downpayment Initiative (ADDI) program for FY'2003 and FY'2004 will
be as follows.
PROGRAM
AMOUNT
FY'2003 American Dream Downpayment Initiative (ADDI)
$ 204,049
FY'2004 American Dream Downpayment Initiative (ADDI)
$ 240,784
ADDI funds may only be used for downpayment assistance towards the purchase of single
f roily housing by low-income families who are first-time homebuyers. Eligible costs include
hard costs for rehabilitation completed in conjunction with a home purchase, including the cost
of reduction of lead paint hazards and the remediation of other home health hazards. A first-time
homebuyer is an individual and spouse who have not owned a home during the three-year period
prior to ADDI assistance.
The Administration recommends that this program be designed to current City Homebuyer
Assistance programs by providing funding in the form of deferred, non -amortizing, non interest -
bearing, twenty-year loans that are to be repaid, in full, by the homebuyer in the event that the
assisted home is sold, leased or rented during the twenty-year loan term. Furthermore, the
current City Homebuyer Assistance program authorizes the City Manager or designee to
determine whether the loan is to be repaid, in full, in the event of a refinancing of the assisted
home during the loan term, on a case by case basis.
ADDI funds may be invested in the form of:
• Interest -bearing loans or advances
• Interest subsidies
• Deferred payment loans
• Grants, or
• Other forms of assistance that U.S. HUD determines to be consistent with ADDI
ADDI assistance cannot exceed the greater of: (i) six percent (6%) of the purchase price of a
single family housing unit or (ii) $10,000 for each family. The home purchased with ADDI
assistance must remain affordable in accordance with requirements identified in the HOME
program, based on the combined ADDI and HOME funds invested in the unit. Many of the
HOME program regulations apply to ADDI assistance, including Environmental Review (24
CFR 92.352), Lead -based paint (24 CFR 92.355), Nondiscrimination requirements (24 CFR
92.350) and Conflict of Interest (24 CFR 92.356). Affirmative marketing and relocation
requirements do not apply to ADDI assistance, except that relocation requirements (24 CFR
92.353) do apply to FY'2003 ADDI funds.
Like HOME funds, ADDI funds must be committed within twenty-four (24) months and
expended within five (5) years of the last day of the month in which HUD notified the City of the
execution of the HOME Agreement. Any funds remaining uncommitted after twenty-four (24)
months and unexpended after five (5) years will be reallocated in the following fiscal year. U.S.
HUD has indicated that ADDI funds are usually assigned the same grant number for each years
1-TOME and ADDI funds.
It is recommended that the City Commission adopt the attached Resolution accepting U.S.
Department of Housing and Urban Development (U.S. HUD) entitlement grants under the
American Dream Downpayment Initiative (ADDI) program for FY'2003 and FY'2004 for use as
downpayment assistance in the purchase of single family housing by low-income families who
are first-time homebuyers, to be provided in the form of a deferred, non interest -bearing, non -
amortizing, twenty-year loan to be repaid by the homebuyer in full, in the event that the home is
sold, leased or rented during the twenty-year period; and authorizing the City Manager or
designee to determine whether repayment by the homebuyer is required in the event of a
refinancing of the home during the twenty-year period, on a case by case basis; and authorizing
the City Manager to execute the necessary documents, in a form acceptable to the City Attorney,
to implement acceptance of said grants.
Theyr s : osed Resolution does not have a budgetary impact on the General Fund.
LMH1: R