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1995-207 j:\wpdocs\ord\optrecon.o ORDINANCE NO. ~' 2~ ~ 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. SECTION II. 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 /7~h day of ~~ 1995. ATTEST: BOB' CASTLEBkRRY, MA7 ~ JENNIFER WALTERS, CITY SECRETARY BY: . APP~ED ~S TO LEGAL FORM. HERBERT L. PROUTY, CITY ATTORNEY TABLE OF CONTENTS I. PURPOSE ............................. Page II. DESIGNATED AUTHORITY ...................... Page III. IMPLEMENTATION PROCESS ..................... Page IV. ELIGIBILITY REQUIREMENTS .................... Page V. FEASIBILITY FOR RECONSTRUCTION ................. Page VI. SELECTION OF RECIPIENTS FOR ASSISTANCE ............. Page VII. ALLOWABLE EXPENSES AND CATEGORIES OF FINANCIAL ASSISTANCE .... Page VIII. REHOUSING AGREEMENT ....................... Page IX. FINAL INSPECTION - CERTIFICATE OF OCCUPANCY ........... Page PROGRAM INCOME RANGE TABLE .................... APPENDIX 1 APPLICATION AND TEMPORARY RELOCATION QUESTIONNAIRE ........ APPENDIX 2 REHOUSING AGREEMENT FOR HOMEOWNERS ................ APPENDIX 3 TEMPORARY REHOUSING ASSISTANCE POLICY ............... APPENDIX 4 C~'TY OF DENTON OPTIONAL RECONSTRUCTTON PROGE~M GUTD~r.]~NES Unless herein stated otherwise, general operating procedures contained in the City of Denton's Community Development Homeowner Rehabilitation Program Gu£delines w£11 be followed. PURPOSE A. The City of Denton, Texas, will provide assistance necessary to accomplish the reconstruction of dwellings not feasible for rehabilita- tion through the Homeowner Rehabilitation Program. The Optional Reconstruction Program will provide funds to temporarily relocate occupants from dilapidated structures into adequate, decent safe, and sanitary dwellings, demolish existing dilapidated dwellings and reconstruct adequate, decent, safe and sanitary replacement dwelling. In addition, the City will also promote the elimination of slum and blight that exists in the City. B. 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. II, DESIGNATED AU=~ORITY 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 and relocation assistance to be made available to individual applicants in accordance with the implementing procedures. This determination will be based upon evaluations of the costs to be incurred by alternative housing options and upon needs of individual applicants with respect to temporary relocation assistance and other expenses required in order to facilitate the rehousing of the occupants. 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 Housing Rehabilitation Program. III. IMPLEMENTATION PROCESS Steps in implementing the program will be as follows: Revised 10/09/95 Program Guidelines - Page i A. Con~nunity Development Office maintains list of applicants for housing rehabilitation program assistance where a determination has been made that the structure is not feasible to rehabilitate to minimum standards under the City's Housing Rehabilitation Program. B. Homeowner 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 proce~ses applications as possible under funding and staff limitations. D. Homeowner is informed of available housing options, including temporary relocation payments and assistance. E. Homeowner submits a Replacement Housing Assistance Request, acknowledg- ing receipt of information explaining the City's program, and request- ing reconstruction payments and assistance to enable homeowner to obtain suitable and adequate housing. F. Community Development Staff determine whether or not approval of homeowner's Replacement Housing Assistance Request reasonably may be expected to result in the successful and feasible rehousing of the homeowner. In cases where the homeowner'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 homeowner's request may be denied. The homeowner 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 homeowner that the City is authorized to enter into a Rehousing Agreement with the homeowner 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 homeowner 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 homeowner and the City, under the terms of which the homeowner agrees to move permanently and voluntarily from the dwelling on or before a specified date. The City agrees to provide the homeowner with a specified amount of Replacement Housing Payment to be used for the sole purpose of obtaining a suitable decent, safe, and sanitary replacement dwelling. H. Community Development Staff will provide counseling and assistance as needed to approved homeowners in order to facilitate the homeowner's rehousing, including referrals to builders, suppliers, etc.; and in extreme hardship cases, provision of temporary housing or reimbursement of temporary housing expenses and reimbursement of moving, storage, and other necessary expenses related to rehousing the applicant as specified in the terms of the Rehousing Agreement. I. The homeowner and the Community Development office agree to the arrangement and method of the approved payments, the homeowner will execute a contract with a builder for the selected replacement Revised 10/09/95 Program Guidelines - Page 2 dwelling. The homeowner will also contract for the demolition of the substandard dwelling and for lot and site clearance and preparation. K. When appropriate, the homeowner voluntarily vacates the substandard dwelling. L. The replacement dwelling is constructed and appropriately inspected by the City to determine adequacy and compliance with City codes. M. City certifies that the replacement dwelling is decent, safe, and sanitary and ready for occupancy. City issues Certificate of Occu- pancy. N. Homeowner accepts replacement home. O. Ail remaining approved payments are made to homeowner at a formal closing ceremony, and homeowner acknowledges receipt of payment. P. Upon completion of all actions in regards to reconstruction, homeowner acknowledges in writing that all payments, assistance, and conditions of the Rehousing Agreement have been received to the applicant's satisfaction. Q. Homeowner occupies replacement structure. Eligibility for reconstruction payments and assistance shall be estab- lished as follows= 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 the city limits of Denton. The dwelling must be the applicant's principal residence for a minimum of 2 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 less 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. Applicant must establish that all property taxes are paid on the property to be vacated (and/or the proposed construction site) and that Revised 10/09/95 Program Guidelines - Page 3 all other liens are satisfied or released. No assistance will be provided on properties with taxes in arrears. The City will relinquish first lien position only to a mortgage company. In all other cases, lienholders will need to relinquish first lien position to the City. F. 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 Cow~unity Development services are provided to applicants who provided inaccurate or incomplete information in order to meet eligibility requirements. Requests for further assistance will be denied unless restitution is made in full. G. Applicants must be certified as financially able to maintain their housing expenses. H. 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. I. Applicants will be encouraged based on individual needs to attend Community Development homeowner education classes, with emphasis being placed on maintenance, budgeting, cost effective decorating, and responsibilities of home ownership when available. V. FEASIBILITY FOR RECONSTRUCTION Feasibility for reconstruction is based on determining all 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. Project costs include, but are not limited to, the cost of demolition, site preparation, approved temporary relocation expenses, cost of replacement dwelling, title search fee, and/or any RUD approved expenditures necessary to replace a substandard unit. VI. SELECTION OF RECIPIENTS FOR ASSISTANCE A. Initial recipients of this program will be taken from the list of homeowners residing in structures determined to be infeasible to rehabilitate. Additional recipients will be added during subsequent operation of the City of Denton's Rousing 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. a?3.OWABLE EXPENSES AND CATEGORIES OF FINANCIAL ASSISTaN~R 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. Revised 10/09/95 Program Guidelines - Page 4 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 D~velopment 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= ~ of Occupants in Household ~ of Bedrooms Minimum Maximum 2 1 4 3 3 6 4 6 8 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 Qualif¥inq Income Limits and Ranqes for the City of Denton's Federally Assisted Proqrams (see appendix to these guidelines for current income limit ranges). A description of the financial assistance categories and their requirements are: 1. 20 Percent Reconstruction Loan / 80 Percent Deferred Payment Loan: Clients whose gross annual household income falls above 65 percent up to 80 percent of Denton's MSA median family income limits will qualify for this two-part loan: a 3 percent interest loan with the loan amount being based on 20 percent of the total project cost (excluding temporary relocation and demolition costs). The 3 percent loan will be amortized over 120 months (10 years). The lien will not be released on this part of the loan until all 120 payments are received in full by the City of Denton; and a deferred payment loan with the loan amount being based on 80 percent of the total project cost (excluding temporary relocation and demolition costs). A detailed description of the deferred payment loan is found below after section VII.D. 2. 10 Percent Reconstruction Loan / 90 Percent Deferred Payment Loan: Clients whose gross annual household income falls above 50 percent up to 65 percent of Denton's MSA median family income limits will qualify for this two-part loan: a 3 percent interest loan with the loan amount being based on 10 percent of the total project cost (excluding temporary relocation and demolition costs) to be amortized over 120 months (10 years). The lien will not be released on this part of the loan until all 120 payments are received in full by the City of Denton; and a deferred payment loan with the loan amount being based on 80 percent of the total project cost (excluding temporary relocation and demolition costs). A detailed description of the deferred payment loan is found below after section VII.D. 3. 5 Percent Reconstruction Loan / 95 Percent Deferred Payment Loan Revised 10/09/95 Program Guidelines - Page 5 Clients whose gross annual household income falls above 30 percent up to 50 percent of Denton's MSA median family income limits will qualify for this two-part loan: a 3 percent interest loan with the loan amount being based on 5 percent of the total project cost (excluding temporary relocation and demolition costs) to be amortized over 120 months (10 years). The lien will not be released on this part of the loan until all 120 payments are received in full by the City of Denton; and a deferred payment loan with the loan amount being based on 95 percent of the total project cost (excluding temporary relocation and demolition costs). A detailed description of the deferred payment loan is found below after section VII.D. 4. 2.5 Percent Reconstruction Loan / 97.5 Percent Deferred Payment Loan Clients whose gross annual household income falls at or below 30 percent 'of Denton's MSA median family income limits will qualify for this two-part loan: a 3 Dercent interest loan with the loan amount being based on 2.5 percent of the total project cost (excluding temporary relocation and demolition costs) to be amortized over 120 months (10 years). The lien will not be released on this part of the loan until all 120 payments are received in full by the City of Denton; and a deferred payment loan with the loan amount being based on 97.5 percent of the total project cost (excluding temporary relocation and demolition costs). A detailed description of the deferred payment loan is found below. *DESCRIPTION OF A DEFERRED PAYMENT LOAN A deferred payment loan shall carry 0 percent interest and continues until the applicant satisfies the conditions listed in the promissory note executed prior to project start date. There are no monthly payments. Deferred payment loans are secured by a lien on the property. The lien will be for 120 months (10 years). For each month the homeowner lives on the property, 1/120 of the total deferred payment loan amount will be forgiven. If the reconstructed dwelling is sold or transferred before the lien period expires, the homeowner is credited for every month of residency. The credit is subtracted from the total loan amount to determine the unforgiven balance. The unforgiven balance is owed and becomes due upon sale or rental of the property to the Community Development Program and is received and used thereof as program income. The City of Denton will be in the 1st lien position on all reconstructed dwellings. However, in situations where 1st lien position is not feasible, the City will accept a lower lien position subject to the review and approval of the community Develop- ment Administrator. The lien will not be forgiven until the following conditions are met: 1. The homeowner must reside in the unit for a period not less than 10 years. 2. The property must be maintained to meet city code requirements. 3. Mortgage payments must be met on a timely basis. 4. Homeowner must provide documentation of adequate homeowner's insurance, including casualty and fire coverage, and the City must Revised 10/09/95 Program Guidelines - Page 6 be listed on the Certificate of Insurance to be notified in case of policy cancellation. D. If within this lO-year period the homeowner defaults on their deferred payment loan, and/or if the homeowner defaults on payments on their 3 percent interest loan, the loan will be called due in full and foreclosure proceedings may be initiated. The City will make every effort to work with the homeowner to avoid foreclosure and will examine each situation on a case by case basis. E. Allowable expenses will includes 1. Cost of total demolition and clearance of the dilapidated struc- ture, lot clearance, and preparation of job site for new replace- ment dwelling. 2. City approved actual and reasonable moving expenses, plus reim- bursement of approved costs for storage of homeowner's belongings as needed. 3. Cost of utility and appliance transfers and hookups as necessary (excluding cable TV). 4. City approved legal and filing fees necessary to obtain a clear title to property. 5. Cost of temporary housing as set forth in the City of Denton's community Development Tenant Assistance Policy. Costs exceeding the Policy can be made in extreme hardship cases when determined necessary by the Community Development staff. 6. Other expenses the Community Development Office determines to be necessary to facilitate the relocation of the homeowner. 7. Cost to reconstruct safe, sanitary, decent replacement dwelling. F. 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 bids for replacement housing. 3. Assistance in temporary relocation and related concerns. 4. Assistance in contractual compliance between homeowner and contractor. 5. Assistance in inspection of construction of replacement dwelling, if applicable. 6. Assistance to applicant in evaluation of future maintenance burdens of various housing options. G. If, after the loan payback begins, a household experiences a permanent, substantial loss of household income, a homeowner 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 2.5 percent payable loan level. The loss of incomemustbefromanincome-earning household member whose incomewas used indeter~ingthe original loan assistance category. Examples of "permanent loss" are: Revised 10/09/95 Program Ouidelines - Page 7 1. death 2. retirement (must be 62 years of age or older) 3. permanent disability 4. member (not a deed holder) has permanently moved out 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 for the Homeowner Rehabilitation Program. 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 loss 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 assistance category guidelines. When a loan reduction is granted, the homeowner 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 property owner feels that his/her circumstances require special consideration. Section V. of the Homeowner Rehabilitation Program Procedures explains how to request a waiver. VIII. REHOUSING AGREEMENT A. 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 homeowner 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. B. The Rehousing Agreement outlines the City's responsibility to provide replacement housing payment, that includes bearing the cost of temporary relocation and moving expenses that have been determined reasonable, and obligates the City to bear the cost of utility and appliance hookups and other fees which may be necessary to make the rehousing possible. FINAL INSPECTION - CERTIFICATE OF OCCUPANCY The City of Denton will be responsible for final inspection of all housing units made available through the program to determine that the replacement unit 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 HUD 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 10/09/95 Program Guidelines - Page 8 APPENDIX 2 OPTIONAL RECONSTRUCTION PROGRAM APPLICATION and TEMPORARY RELOCATION QUESTIONNAIRE Your participation in the Optional Reconstruction Program is voluntary. Reconstruction funds are limited. Therefore, only limited temporary relocation assistance may be available to you. Please complete the following questionnaire. This information will help our staff in determining if you will be eligible for the Optional Reconstruction Program. 1. Do you own any other property within the City limits besides the property your home is on? Yes No If yes, what is the property address: . Could this property be used to construct your replacement dwelling? Yes No 2. Are you currently paying a mortgage payment on your home? Yes No If yes, what is the payment amount? $ 3. If you need to be relocated for home reconstruction, do you have a family member or friend whom you could live with during the reconstruction period (about 3 - 4 months)? Yes No If no, what are your plans for relocating during the reconstruction period? 4. Are you, family members or friends able to move your household goods? Yes No 5. I 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 6. I understand that an increase in my property value may cause my property taxes to increase by a significant amount. I am financially prepared to meet any increase? Yes No 7. I understand that I am obligated to carry homeowner's insurance for the duration of the lien (10 years) that the City of Denton will have on my property. Yes No 8. I 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 after-reconstruction appraised value of my property. I am financially prepared to meet this increase. Yes No g. I understand that I must request that my insurance company list the City of Denton as a "Certificate Holder" on my policy?. Yes No 10. I understand that The City 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 costs 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 APPENDIX 3 CITY OF DENTON COMMUNITY DEVELOPMENT PROGRAM OPTIONAL RECONSTRUCTION PROGRAM REHOUSING AGREEMENT FOR HOMEOWNERS THIS AGREEMENT, made and entered into on FIELD(11), by and between the City of Denton, Te~an, and FIELD(l) hereinafter referred to as Owners. This agreement covers the ~i~ucture occupied at the following legal address: FIELD(4) WHEREAS, The Owner 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 th6 City's Community Development Block Grant and HOME Program; and WHEREAS, the City has determined that rehabilitation of the Owner's residence is not a feasible alternative; and WHEREAS, the City has determined that it is appropriate under the community Development Program to provide the Owner certain relocation payments and assistance necessary to accomplish the voluntary relocation of the Owner from the substandard, unrehabable dwelling currently occupied into an adequate, safe, and sanitary replacement dwelling. NOW, THEREFORE, the City and the Owner for and in consideration of the covenants and promises as hereinafter set forth, do agree as follows: 1. The Owner agrees to vacate permanently the currently occupied substandard dwelling within 10 days notice by the City for the need to vacate. 2. The Owner agrees and hereby authorizes the demolition and removal of the currently occupied dwelling and clearance by the City of the property. The Owner further releases the City from any and all claims arising from this action. 3. The Owner 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 Owner further agrees to sign any required instruments to effect this item. 4. The City agrees, subject to the provisions of the City's Optional Reconstruction Program Administrative Guidelines, to provide the Owner a Temporary Housing Payment. 5. The maximmm budget authority for the Optional Reconstruction Program is FIELD(6), which includes, but is not limited to, the cost to demolish the existing dilapidated structure, approved Temporary Relocation Payments and the cost to reconstruct an adequate, decent, safe, and sanitary replacement dwelling on the original site (lot) of the dwelling vacated by the homeowner. 6. If required, the City agrees to pay a Temporary Housing Payment: Utility transfer or hook-up fees determined by the City as necessary; approved moving and related expenses necessary to effect the moving of the Owner's personal belongings from the original vacated dwelling into temporary housing and back into replacement dwelling; and other expenses determined necessary by the City to complete the rehousing of the Owner. FIELD(12) DATE FIELD(I 3) DATE CITY OF DENTON: BARBARA ROSS, COMMUNITY DEVELOPMENT ADMINISTRATOR NANCY BAKER, HOUSING REHABILITATION SPECIALIST MERGE FIELD DOCUMENT EXPLANATION: FIELD 11 = DATE DOCUMENT WILL BE SIGNED FIELD 1 -- NAME(S) OF HOMEOWNER SIGNING DOCUMENT FIELD 4 -- LEGAL PROPERTY DESCRIPTION OF DWELLING TO BE RECONSTRUCTED FIELD 6 = MAXIMUM ALLOWABLE FUNDS FOR PROJECT: I.E., 1 BDRM -- $41,054; 2 BDRM -- $49,921; 3 BDRM -- $64,581; AND 4 BDRM = $70,890. (THESE DOLLAR AMOUNTS ARE SET BY HUD FOR THE DENTON AREA AND WILL BE CHANGED TO REFLECT HUD'S RE- QUIREMENTS FOR DENTON AS DIRECTED.) FIELD 12 -- FIRST NAME OF HOMEOWNER FIELD 13 = SECOND NAME OF HOMEOWNER (IF APPLICABLE) APPENDIX 4 OPTIONAL RECONSTRUCTION PROGRAM TEMPORARY HOUSING ASSISTANCE SUBSIDY LIMIT POLICY The City of Denton Community Development Office sets this Temporary Housing Assistance Policy to assist clients who have applied for the Optional Reco~i~action Program with temporary housing and relocation payments. The formula used to figure the maximum allowable rent subsidy payment is: Maximum Allowable Rent Subsidy Limit (See table below) less (-) 30 percent of applicant's Household Gross Monthly Income plus (+) amount of applicant's monthly mortgage payment (if applicable) If the result of the above formula is above the Maximum Allowable Rent Subsidy Limit, then the City will ass'.~st only up to the maximum allowable limit. If the actual temporary rent payments are below the allowable maximum limit, the City will reimburse the actual temporary rent payments. MAXIMUM ALLOWABLE SUBSIDY LIMIT TABLE Family Maximum Allowable Size Rent Subsidy Limit 1 $ 640 2 $ 731 3 $ 823 4 $914 5 $ 988 6 $1060 7 $1134 8 $1206 EXAMPLE 1 Family Size = 4 Max Limit = $ 914.00 Gross Mo. Hshld Income = $1967 30% income - 590.00 Mo. Mortg. Payment = 297 Mortg. Pymt. + 297.00 = $ 621.00 The family in Example 1 can receive temporary rent assistance up to $621.00. EXAMPLE 2 Family Size = 2 Max Limit -- $ 731.00 Gross Mo. Hshld Income = $1368 30% income - 410.00 Mo. Mortg. Payment -- $ 0 Mortg. Pymt. + 0.00 = $ 321.00 The family in Example 2 can receive temporary rent assistance up to $321.00.