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HomeMy WebLinkAbout1996-235t \updocs\ord\optrecon o ORDINANCE NO. '1 & ^A367 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS, APPROVING GUIDELINES FOR OPERATION OF THE CITY OF DENTON OPTIONAL RECONSTRUCTION PROGRAM AND ELIGIBILITY CRITERIA; AUTHORIZING EXPEN- DITURES IN EXCESS OF $15,000 FOR PROJECTS MEETING PROGRAM GUIDE- LINES AND CRITERIA; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, the City Council of the City of Denton recognizes the need to assist low and moderate income families in securing safe, sanitary and decent housing; and WHEREAS, the City of Denton participates in a Housing Rehabili- tation Program administered by the City of Denton Community Devel- opment Office and funded through a federal grant from the Depart- ment of Housing and Urban Development, NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION I. That it approves the Optional Reconstruction Program Guidelines and Optional Reconstruction Program Eligibility Criteria which is attached to this ordinance as Exhibit "A" and authorizes the City of Denton Community Development Office to administer this program SSECTION That it authorizes the expenditure of funds in excess of $15,000 by the Community Development Office for projects meeting program guidelines and criteria. SECTION III. That this ordinance shall become effective immed- iately upon its passage. /+." PASSED AND APPROVED this the � day of / /(�ri8 , 1996. i At Ck JACK MILLER, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: PROUTY, CITY BY: - _--- CITY OF DENTON OPTIONAL RECONSTRUCTION PROGRAM GUIDELINES - 1996/97 Page 4 TABLE OF CONTENTS I PURPOSE Page 1 II DESIGNATED AUTHORITY Page 1 III IMPLEMENTATION PROCESS Page 1 IV ELIGIBILITY REQUIREMENTS Page 3 V FEASIBILITY FOR RECONSTRUCTION Page 4 VI SELECTION OF RECIPIENTS FOR ASSISTANCE Page 4 VII ALLOWABLE EXPENSES AND CATEGORIES OF FINANCIAL ASSISTANCE Page 4 VIII REHOUSING AGREEMENT Page 6 IX FINAL INSPECTION CERTIFICATE OF OCCUPANCY Page 6 APPENDIX I PROGRAM INCOME RANGE TABLE Page 7 APPENDIX II APPLICATION AND TEMPORARY RELOCATION QUESTIONNAIRE Page 8 APPENDIX III REHOUSING AGREEMENT FOR AppllcantS Page 9 APPENDIX IV TARGET REHABILITATION NEIGHBORHOODS MAP Page 11 Page 5 CITY OF DENTON OPTIONAL RECONSTRUCTION PROGRAM GUIDELINES Unless herein stated otherwise, the general operating procedures contained in the City of Denton's Community Development Homeowner Rehabilitation Program Guidelines will be followed II. The City of Denton, Texas, will provide assistance necessary to accomplish the reconstruction of dwellings not feasible for rehabilita- tion The Optional Reconstruction Program will provide funds to demolish existing dilapidated dwellings and reconstruct adequate, decent, safe and sanitary replacement dwellings. In addition, the City will also promote the elimination of alum and blight that exists in the City Reconstruction payments and assistance will be carried out under the City of Denton's Community Development Program as an eligible expense from project funds. Assistance shall be subject to the availability of grant funds and U S Department of Housing and Urban Development (HUD) implementing regulations. Administrative procedures will be modified to meet any change in rules and regulations of HUD which may occur over time. A. Administrative authority for implementation of the program will rest with the City of Denton's Community Development Office. This office will serve as the approving office for Rehousing Agreements and for contractual and budget changes as needed for project completion B. The Community Development Administrator will have the responsibility for final determination of the amount of reconstruction assistance to be made available to individual applicants in accordance with the implementing procedures. C. The Community Development Administrator will be responsible for approval of applicant eligibility for the program and final approval of selection of applicants to be assisted This will be based upon relative need of applicants on the City's list of houses which have been determined infeasible for rehabilitation under the City's Homeowner Rehabilitation Program Steps in implementing the program will be as follows A. Community Development Office maintains list of applicants for Homeowner Rehabilitation Program assistance where a determination has been made that the structure is not feasible to rehabilitate to minimum standards under the City's Homeowner Rehabilitation Program Revised 08/02/96 Program Guidelines - Page 1 Page 6 B Applicant is notified that the rehabilitation of the structure has been determined to be infeasible Eligibility requirements for the Optional Reconstruction Program must be met for applicants to be placed on the Optional Reconstruction Program waiting list C Staff evaluates applications for reconstruction assistance as specified in Section VI Staff processes applications as possible under funding and staff limitations D Applicant is informed of available assistance E Applicant submits a Replacement Housing Assistance Request, acknowledg- ing receipt of information explaining the City's program, and request- ing reconstruction assistance to enable applicant to obtain suitable and adequate housing F Community Development Staff determine whether or not approval of applicant's Replacement Housing Assistance Request reasonably may be expected to result in the successful and feasible rehousing of the applicant In cases where the applicant's general health or income level would preclude his or her adequate and responsible operation of a replacement dwelling; and/or cases in which the costs of the replacement dwelling would be substantially above the costs of typical cases, and to the extent that the probability of the City reaching its Community Development Program goals would be endangered due to cost overruns, the applicant's request may be denied. The applicant will be notified in writing of the determination and, if the request is not approved, the reasons for denial When the determination is approval of the applicant's request, a Notice of Approval will be sent informing the applicant that the City is authorized to enter into a Rehousing Agreement with the applicant for a specified Replacement Housing Payment determined appropriate by the city pursuant to its Reconstruc- tion Policy Prior to any agreement being executed between the applicant and the City, the Community Development Office will comply with the public disclosure and notification/authorization to and from HUD requirements according to 24CFR Part 70, Section 104(d), Recon- struction and One -for -One Replacement Housing Requirements G. A Rehousing Agreement is executed between the applicant and the City, under the terms of which the applicant agrees to move permanently and voluntarily from the dwelling on or before a specified date. H Community Development Staff will provide counseling and assistance as needed to approved applicants in order to facilitate the applicant's rehousing, including referrals to builders, suppliers, etc. I The applicant and the Community Development office agree to the arrangement and method of the approved payments, the applicant will execute a contract with a builder for the selected replacement dwelling The applicant will also contract for the demolition of the substandard dwelling and for lot and site clearance and preparation J When appropriate, the applicant voluntarily vacates the substandard dwelling K The replacement dwelling is constructed and appropriately inspected by the City to determine adequacy and compliance with City codes L City certifies that the replacement dwelling is decent, safe, and sanitary and ready for occupancy. City issues a final building inspection Revised 08/02/96 Program Guidelines - Page 2 Page 7 M. Applicant accepts replacement home N. All remaining approved payments are made to applicant at a formal closing ceremony, and applicant acknowledges receipt of payment schedule 0. Upon completion of all actions in regards to reconstruction, applicant acknowledges in writing that all payments, assistance, and conditions of the Rehousing Agreement have been received to the applicant's satisfaction. P. Applicant occupies replacement structure IV. ELIGIBILITY REQUIRMOSNTB Eligibility for reconstruction payments and assistance shall be estab- lished as followsi A. Applicant must have applied for rehabilitation assistance under the City of Denton's Housing Rehabilitation Program. B. Applicant must have been rejected for rehabilitation assistance on the grounds that the applicant's occupied dwelling was not feasible to rehabilitate. C. Applicant must be an owner occupant of the dwelling for which rehabili- tation assistance is requested and reside within a Target Rehabilitation Neighborhood (see Appendix 4) The dwelling must be the applicant's principal residence for a minimum of 8 years prior to the submission of a completed application for assistance D Applicant must present proof of ownership by General or Special Warranty deed. City staff will verify proof of ownership with title searches as necessary on the property where the dilapidated structure exists and/or the site where the replacement housing will be built In situations where the applicant does not have clear title, attempts to clear the title will be initiated with the assistance of the applicant. When meeting this guideline requirement is not feasible, applicant must present proof of ownership (General or Special Warranty Deed) showing fee simple title of 50% or more ownership in the applicant's name (All other title holders will be requested to relinquish their title rights to the applicant ) Applicants with lase than 100 percent fee simple title must have a continuing right to occupy the premises. Applicant must provide documentation for all existing liens. All current lienholders will be requested to subordi- nate their lien position to the City E Mortgage note balance cannot exceed 50 percent of the property's appraised value as set by the Denton Central Appraisal District F. The City will relinquish first lien position only to a mortgage lender In all other cases, lienholders will need to relinquish first lien position to the City. G Applicants shall provide complete and accurate information regarding their household composition, household income, and housing situation Failure to disclose information which may affect eligibility require- ments shall also constitute fraud Applicants shall be required to make full restitution to the City in the event Community Development services are provided to applicants who provided inaccurate or incomplete information in order to meet eligibility requirements Revised 08/02/96 Program Guidelines - Page 3 Page 8 Requests for further assistance will be denied unless restitution is made in full H Applicants must demonstrate that their income exceeds their projected housing expenses I Applicants will agree to conform with Denton Code Enforcement requests prior to being determined eligible for replacement housing assistance Applicants agree to maintain dwelling and exterior grounds in accor- dance with applicable city ordinances * Applicants will be encouraged based on individual needs to attend Community Development applicant education classes, with emphasis being placed on maintenance, budgeting, cost effective decorating, and responsibilities of home ownership when available. R Must apply to a participating lender and be eligible for a loan to cover part of the cost of the reconstruction Feasibility for reconstruction is based on determining g�,,] related costs to complete a reconstruction project. Total project costs cannot exceed the maximum amount allowed as set by the current Section 221(d)(3) Lowest Home Per -Unit Subsidy Limits for the State of Texas as set by the Department of Housing and Urban Development (HUD). Project costs include, but are not limited to, the cost of demolition, site preparation, cost of replacement dwelling, title search fee, aid/or City -funded interest buy - down for bank financed portion of the project. A Initial recipients of this program will be taken from the list of applicants residing in structures determined to be infeasible to rehabilitate Additional recipients will be added during subsequent operation of the City of Denton's Housing Rehabilitation Program B The number of recipients to receive assistance will be subject to availability of funds C Applicants will be placed on a waiting list for reconstruction assistance based on the time and date they originally applied to the Community Development Office for rehabilitation assistance VII. ALLOMAELS EXPENSES AND CATEOORIES OF FINANCIAL ASSISTWCX A. The primary form of assistance to be provided will be the use of Federal HOME grant funds to pay for the cost of the replacement dwelling and costs related to replacing a substandard unit B No reconstruction will net fewer bedrooms than the number of bedrooms a family has before reconstruction Room addition(s) to relieve serious overcrowding may be eligible only with the approval of the Community Development Administrator In general the City will follow the standards consistent with the applicable Housing Quality Standards described at 24CFR 882 209(b)(2) when considering the number of bedrooms needed to avoid overcrowding Revised 08/02/96 Program Guidelines - Page 4 Page 9 # of occupants in Household ! of Bedrooms Minimu maximum 2 1 4 3 3 6 4 6 e C The City of Denton has FOUR FINANCIAL ASSISTANCE CATEGORIES for those who qualify for the Optional Reconstruction Program. These categories are based on the Oualifyina Income Limits and Ranges for the City of Denton's Federally Assisted Programs (see appendix 1 to these guide- lines for current income limit ranges) A description of the financial assistance categories and their requirements are found in Section III of the Homeowner Rehabilitation Guidelines D Allowable expenses will includes 1 Cost of total demolition and clearance of the dilapidated structure, lot clearance, and preparation of job site for new replacement dwelling. 2. Cost to reconstruct safe, sanitary, decent replacement dwelling 3 Other expenses the Community Development office determines to be necessary to facilitate the reconstruction of the substandard property E. Community Development staff will also provide assistance and counseling to applicants as needed, including the following. 1. Information on the program and rehousing options available 2 Assistance in soliciting bide for replacement housing 3. Assistance in contractual compliance between applicant and contractor 4. Assistance in inspection of construction of replacement dwelling, if applicable. 5. Assistance to applicant in evaluation of future maintenance burdens of various housing options F If, after the loan payback begins, a household experiences a permanent, substantial lose of household income, a applicant can request a review to adjust their current level of assistance However, in no instance will the payable loan portion be reduced below the minimum 10 percent payable loan level The loss of gnome must be from an income-earnzng anplicantls) whose ancome was used in determining the original loan assistance category. Lose of employment (voluntarily or involuntarily) is not considered a "permanent lose". For purposes of this program "permanent lose" is defined set 1 death 2 mandatory retirement (must be 62 years of age or older) 3. permanent disability Revised 08/02/96 Program Guidelines - Page 5 Page 10 To determine if a reduction in the loan is eligible, the household members will be asked to complete all income information and forms as required in Section II - Application Processing A determination will be made after evaluating the household size and income using the program guideline income limits and financial assistance categories that are being used at the time the request for reduced loan payment is made If the lose of income places the household in a lower payback category, the loan balance will be reduced (which will increase the deferred payment loan balance) according to current financial assis- tance category guidelines When a loan reduction is granted, the applicant must sign an Extension of Note and Lien reflecting the new loan and deferred loan amounts A waiver of these provisions can be requested if the applicant feels that their circumstances require special consideration. Section V of Program Procedures explains how to request a waiver VIII REHOUSING AGREBNENT Each applicant assisted through the program will sign a Rehousing Agreement with the City which outlines the responsibilities of each The agreement establishes a date on which the applicant agrees to permanently vacate the present structure, agrees to demolition of the present dilapidated structure, agrees to occupy the replacement structure when structure is completed and ready to be inhabited, and agrees that temporary housing will terminate when structure is ready for occupancy as determined by the City of Denton IE. FINAL INSPECTION - CERTIFICATE OF M MMC The City of Denton will conduct a final inspection of all housing unite made available through the program to determine that the replacement unit and all items identified in a "punch list" have been corrected This Certificate of Occupancy will serve as evidence to HOD of the City's determination that the dilapidated structure has been replaced by a decent, safe, and sanitary dwelling and that the family has been successfully relocated Revised 08/02/96 Program Guidelines - Page 6 Page 11 APPENDIX 1 9) z 0 z w 0 b LU U �k �■ ■ U.a z� 40 o« «.j �Ir �§ LU kLL � z § « � 0 k§ §k § 2§ § 2| | §N § § | § | | IS:§ m ! ! ! m § m m K K a s K s& 5 \ \ } } \ } \ } § § r § § B 2 # ; ; ■ & & ! 3 # \ \ § k § \ ■ § � m ■ ; � . 6 & & # # ! ! # k § § ■ ■ ■ ! G G ■ & a 3 ! 2 # ■ 2 2 2 ! § ■ § \ §§§ e §§k / CC 30 § §>.§ 9 2§E ir §§/ § qa § zz cc WJ cc §§� $ \§| \ G§2 } k(§ (02 ir \j§ k <k5- w 509 § !§e [ !x» §�� 5 © } ���wz ) \\�z ) z� / )k¢B k )( cz/ § 0. �(E s §( |§*E § e §=k$ § �k §�\) § \) �CC CC2& . a cc <m (rWCC- >.« §°mcr ! !� w/!2 ■ E � Page 2 APPENDIX 2 OPTIONAL RECONSTRUCTION PROGRAM APPLICATION Your participation In the Optional Reconstruction Program is voluntary Reconstruction funds are limited Therefore, the Program does not cover costs necessary for household to relocate during reconstruction of property Please complete the following questionnaire This Information will help our staff in determining If you will be eligible for the Optional Reconstruction Program 1 I understand that It is my responsibility to relocate my household and that I am responsible for all costs Involved to do so? _ Yes _ No 2 1 understand that as a result of reconstruction, my appraised property value may Increase significantly from the amount at which it Is currently valued? Yes No 3 1 understand that an increase In my property value may cause my property taxes to Increase by a significant amount I am financially prepared to most any Increase? Yes _ No 4 1 understand that I am obligated to carry homeowner's Insurance for the duration of the Ilan (10 years) that the City of Denton will have on my property Yee No 6 1 understand that my homeowner Insurance premium will most likely Increase as a result of the reconstruction I am aware that my Insurance policy must cover the alter-reconstructon appraised value of my property I am financially prepared to meet this Increase _ Yes _ No 6 1 understand that I must request that my Insurance company list the City of Denton as a'Certificate Holder' on my policy? Yes No 7 1 understand that The Ciy of Denton Is limited In the amount of funds they can spend to reconstruct a property I have been briefed on these limits and understand that my eligibility for the Optional Reconstruction Program will be granted only If It Is determined that the total of all coats Involved to reconstruct my property will be at or below the allowable program limit Yes No This APPLICATION was completed by on By signing below, I am requesting that the City of Denton's Community Development Office accept this as my application to be considered for the Optional Reconstruction Program Applicant's Signature DATE Revised 08/02/96 Program Guidelines - Page 8 Page 13 APPENDIX 3 CITY OF DENTON COMMUNITY DEVELOPMENT PROGRAM OPTIONAL RECONSTRUCTION PROGRAM .EHOUSING AGREEMENT FOR APPLICANTS THIS AGREEMENT, made and entered into on FIELD(11), by and between the City of Denton, Texas, and FIELD(1) hereinafter referred to as Applicants This agreement covers the structure occupied at the following legal address FIELD(4) WHEREAS, The Applicant has heretofore requested and qualified for the Homeowner Rehabilitation Program with assistance from the City in order to obtain adequate, decent, safe, and sanitary housing under the City's Community Development Block Grant and HOME Program, and WHEREAS, the City has determined that rehabilitation of the Applicant's residence is not a feasible alternative, and WHEREAS, the City has determined that the Community Development Program will not provide the Applicant relocation payments and assistance necessary to accomplish the voluntary relocation of the Applicant from the substandard, unrehabable dwelling currently occupied into an adequate, safe, and sanitary replacement dwelling NOW, THEREFORE, the City and the Applicant for and in consideration of the covenants and promises as hereinafter set forth, do agree as follows 1 The Applicant agrees to vacate permanently the currently occupied substandard dwelling within 10 days notice by the City for the need to vacate 2 The Applicant agrees and hereby authorizes the demolition and removal of the currently occupied dwelling and clearance by the City of the property The Applicant further releases the City from any and all claims arising from this action 3 The Applicant agrees to take possession and occupy the replacement dwelling when such dwelling is completed and the City determines it to be ready for occupancy The Applicant further agrees to sign any required instruments to effect this item Revised 08/02/96 Program Guidelines - Page 9 Page 14 The Applicant agrees, to provide and bear all financial costs necessary to relocate Applicant's household and furnishings without assistance from the City of Denton The maximum budget authority for the Optional Reconstruction Program is FIELD(6), which includes, but is not limited to, property title search fee, the cost to demolish the existing dilapidated structure and the cost to reconstruct an adequate, decent, safe, and sanitary replacement dwelling on the origmal site (Iot) of the dwelling vacated by the applicant 6 Applicant agrees to the time limitations as set forth in the Optional Reconstruction Guidelines in which to be moved from the substandard property FIELD(12) DATE FIELD(13) DATE CITY OF DENTON BARBARA ROSS, COMMUNITY DEVELOPMENT ADMINISTRATOR NANCY BAKER, HOUSING REHABILITATION SPECIALIST Revised 08/02/96 Program Guidelines - Page 10 Page 15