20-623ORDINANCE NO. 20-623
AN ORDINANCE QF THE CITY C)F DENTON APPRaVIl�TG THE DEVELOPMENT FEE
GRANT PROGRAM; RESCINDING ORDINANGE 19-390 ESTABLISHIN� THE
AFFORDABLE HOUSING FEE GRANT PROGRAM; ESTABLISHI�TG TF� GUIDELIiVES
FOR THE PROGRAM AND THE PRQVISIONS F�R ENFORCEMENT THEREOF;
ESTABLISHIlVG AN ANNUAL BUDGET; AND PROVIDING FOR AN EFFECTIVE DATE.
WI�REAS, the City Council of the City of Denton, finds that affordable housing and
nonprafit facilities within the City Iimits contributes to a slronger economy and better quality of
Iife for residen#s; and
WI-�REAS, the City of Denton recognizes the need to support low-income households in
securing safe, sanitary, and affordable housin�; and
WHEREAS, the City of Denton recognizes the need ta encourage the preservation af
e�sting and cons#ruction of new aecessibie pubic faciliti.es in Denton to suppart low income
hauseholds with access to suppartive services; and
WHEREAS, the City of Denton recognizes thai financial support of nonprofit
arganizations serves a public purpose; and
WHEREAS, the City of Denton has previously adop#ed 4rdinance 19-39Q authorizing an
Affordable Housing Fee Grant Program which the City Council desires to replace with a
Develapment Fee Grant Progra.m; and �
WHEREAS, pursuant to initiatives adapted by the Ciiy Council of the City of Dentan as
part of the Consolidated Plan for Hausing and Cammunity Development, stafF has developed a
development fee grant prQgram to assisi with the building pennits and u#ility fees, including rc�ad,
water and wastewater impact fees for facilities that provide social and suppartive services to
Dentan residents; NOW, THEREFORE
THE CITY COUNCIL OF THE CITY aF DENTON HEREBY ORDAINS:
SECTION 1. The City Council approves the Development Fee Grant Program Guidelines
which are attached hereto as E�ibit A and made a part of this ordinance far a11 purposes and
suthorizes the City of Denton Cammwuty Development Division ta administer this program. The
attached guidelines shall replace and supezsede any previous development fee incentive grant
program guidelines adopted by the City Council.
SECT'ION 2. The City Council authorizes the expendi#ure of general funds by the
Cammunity Development 13ivision, in the amount of $225,000 or less in the farm of a grant of
development fees far each qualifying project in accardance with the Develapment Fee Crrant
Program Guidelines.
SECTION 3. The Development Fee Grant Prfl,gram shall be funded annually in an amaunt
approved by the City Councii in the budget.
SECTION 4. This ordinance sha11 become effective immed'zately upon its passage and
approvai.
The mai�on to approve this ordinance was made by �%�5� /���/iS and seconded
by �fi�i�/ �1�tf �I/ , the ordinance was passed and appraved by the
following vote � - 0�]:
Chris Watts, Mayor:
Geraxd Hudspeth, District 1:
Keely G. �riggs, I}istrict 2:
Jesse Davis, District 3:
3ohn Ryazi, District 4:
Deb Armintar, At Lazge Place 5:
Paul Melizer, At Large Place 6:
A�Te Nav
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Abstain Absent
PASSED AND APPRovEn this the �/ s� day vf Q,C , 2020.
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AT'TEST:
RO�A RIOS, CITY SECRETAR.Y
BY: •-
CHRIS WATTS, MAITOR
EXHIBIT A
DEVELOPMENT FEE GRANT PROGRAM
-- ___- -- - -,
C1TY
OF
DENT�N
DEVELOPM ENT FEE
G RANT P ROG RAM
PURPOSE AND SCOPE
Pursuant to initiatives adopted by the City Council of the City of Denton as part of the Consolidated Plan
for Housing and Community Development, the City of Denton recognizes that safe, decent, affordable
housing and accessible public facilities are an important part of a community development strategy. fihe
purpose of the Development Fee Grant (the "Program") is to assist with the development and
preservation of affordable housing and with the delivery of supportive services that are essential to
quality of life and to building communities that support community diversity and stability.
There are two categories of projects eligible for this Development Fee Grant:
1. DEVELOPMENT FEE GRANT — AFFORDABLE HOUSING PROJECTS
In collaboration and partnerships with local nonprofits, the City is offering the Program as an
incentive for single-family affordable housing to:
• Reduce the housing cost burden for income qualified families;
• Increase homeownership opportunities for income qualified families; and
• Encourage preservation of existing and construction of new affordable housing in Denton.
2. DEVELOPMENT FEE GRANT — NONPROFIT FACILITY PROJECTS
In collaboration and partnerships with local nonprofits, the City is offering the Program as an
incentive for supportive services provision to:
• Reduce barriers to residents in need to receive assistance through supportive services;
� Increase access to supportive services;
• Encourage preservation of existing and construction of new accessible public facilities in Denton.
The Program, provided as a reimbursement grant, will assist eligible organizations and projects with the
cost of building permits and utility fees, including road, water and wastewater impact fees. ihis
document sets forth the administrative process for the application, implementation, and compliance
requirements of the Program.
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DEVELOPMENT FEE GRANT PROGRAM
01. QUALIFYING ENTITY
The entity must be a Qualified Nonprofit Organization as defined in
26 U.S.C. Section 501(c)(3); and
• has a corporate purpose that meets the definition of charitable as
set forth in the in 26 U.S.C. Section 501(c)(3) that is stated in its
articles of incorporation, by-laws, or charter;
• has been incorporated in this state of Texas for at least two years;
• has none of its earnings inure to any private shareholder or
individual;
• has at least one-fourth of its board of directors residing in Denton;
� engages primarily in services for low- to moderate-income
individuals and families.
❖ SINGLE-FAMILY AFFORDABLE HOUSING PROJECTS
1. Must be a Qualified Nonprofit Developer of Affordable Housing as defined in in 26 U.S.C. Section
501(c)(3); or
2. Must be an income qualified homeowner eligible for housing programs supported by the City's
CDBG and HOME funds.
❖ NONPROFIT FACILITY PROJECTS
1. The Qualified Nonprofit Organization facility must be providing housing or human services to
Denton residents inside the building; and
2. NONPROFIT FACILITY PRIORITIES
Projects will be reviewed and ranked with the following considerations.
—� Facility provides low barrier access permanent supportive housing for persons
experiencing homelessness.
� Facility provides low barrier access transitional or emergency housing for persons
experiencing homelessness.
� Facility provides housing and/or supportive services for persons experiencing or at-risk of
homelessness.
� Facility provides physical health, mental health and/or behavioral health care to
uninsured and other income qualified persons.
� Facility provides services to victims of abuse or neglect.
� Facility provides sliding scale or other fees subsidized quality child care program for
children and youth.
� Facility provides services to the elderly or infirm.
� Facility provides services to persons with disabilities.
� All other facilities that do not provide direct services to people but are a Qualified
Nonprofit Organization.
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DEVELOPMENT FEE GRANT PROGRAM
02. ASSISTANCE
The Program will assist Qualified Nonprofit Organizations with
reimbursement grant for the cost of permits and utility fees, including
but not limited to:
� Building permit fees including plan review, building permits,
temporary power, and fence permits;
• Roadway Impact Fees; and
• Utility Fees including water and wastewater impact fees.
To be eligible the Single-Family Affordable Housing Unit or Nonprofit Facility must meet the
requirements of all applicable City Codes, Zoning, and related development regulations. In addition:
SINGLE-FAMILY AFFORDABLE HOUSING PROJECTS
The Affordable Housing unit must be a new single-family residential unit developed by a Qualified
Nonprofit Developer and/or a new or existing single-family residential unit qualifying for a housing
program supported by the City's CDBG or HOME funds.
NONPROFIT FACILITY PROJECTS
The Qualified Nonprofit Organization building must be open to the public and providing housing or
supportive services to Denton residents inside the building.
03. AMOUNT
The total grant funds available for the Program shall be limited to an
amount set by City Council on an annual basis. All Program grants will be
approved or denied solely at the discretion of the City of Denton, subject
to the Program requirements and the availability of funds.
Each request will be considered on a case-by-case basis until grant funds
are expended.
❖ SINGLE-FAMILY AFFORDABLE HOUSING PROJECTS
Qualified Nonprofit Developers of Affordable Housing units and eligible homeowners participating
in housing programs supported by the City's Community Development Block Grant ("CDBG") and
HOME Investment Partnership ("HOME") funds may be eligible for a grant award for some or all of
the following fees up to a maximum per unit cost of $12,000 per unit.
❖ NONPROFIT FACILITY PROJECTS
4ualified Nonprofit Organizations may be eligible for a grant award for some or all of the
development fees up to a maximum per proiect cost of $50.000.
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DEVELOPMENT FEE GRANT PROGRAM
04. MONITORING AND COMPLIANCE
Once the grant is approved, to avoid repayment of fees, the project must
meet the minimum compliance requirements and the City reserves the
right to periodically monitor the Affordable Housing Unit or Public
Facility to ensure ongoing compliance during the 10-year compliance
period. The following sources of verification may be used:
• Income Verifications.
• Compliance with applicable City Municipal Codes and Ordinances.
• Title report search.
� Lien and ownership search in the applicable County Clerk's Office
online records.
• Ownership verification in applicable tax office appraisal records.
� Scheduled Onsite Visit and/or Inspection.
05. LIMITATIONS
To ensure the program funds are dispersed equitably and are available
for a variety of projects, the following limits apply:
1. No grant applications will be accepted for work that has already been
started or completed, or for work that is covered by insurance.
2. Grants are awarded on a reimbursement basis once completed work
has been verified by City staff as compliant with the project proposed
in the approved application.
3. Homeowners will not be eligible for the Program if the homeowner
owes city ad valorem taxes or another city debt.
4. The Qualified Nonprofit Organization will not be eligible for the
Program if the entity owes city ad valorem taxes, other city debt, or
has code or other accessibility violations on any previous units,
facilities, or projects.
5. The project cannot be in partnership with a for profit entity.
6. Applicant cannot have any unexpended/open grant funds from any
other City grant for the same Affordable Housing or Public Facility
project.
AFFORDABLE HOUSING GEOGRAPHIC LIMITATIONS
The City of Denton seeks to encourage an equitable distribution of Affordable Housing in all parts of
Denton. Qualified Nonprofit Developer seeking the Development Fee Grant for an affordable housing
project must demonstrate it has made reasonable attempts to reduce the isolation of income groups
within a geographic area by expanding and dispersing affordable housing units throughout the City
Preference in the grant program will be given to projects that promote the spatial deconcentration of
affordable housing. Projects that do not promote an equitable distribution of Affordable Housing may
be eligible for the Program if the Qualified Nonprofit Developer demonstrates that there are limited
options for geographic deconcentration due to limited availability of affordable parcels of land, owner
choice for location of home, projects retain a property already affordable, etc.
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DEVELOPMENT FEE GRANT PROGRAM
06. PROCESS
Qualified Nonprofit Organizations requesting to participate in the Program
must submit a completed Development Fee GrantApplication and submit
it to the City of Denton. Applicants receiving the grant will be required to
enter into an agreement with the City of Denton that require the applicant
to comply with the Program Requirements.
The process is described in Part A, B. and C. next.
PART A. APP�ICATION SUBMISSION REQUIREMENTS
An application for participation in the Program is available online or can be obtained from and returned
to Community Development, located at 601 E. Hickory, Suite B, and Denton, TX 76205. The application
must be completed in its entirety, signed, and submitted together as described. Application must be
provided to Community Development at least 2 weeks prior to application for applicable permits.
1. TO APPLY
(a) Complete the Application Packet including all required Attachments:
1) Documentation of incorporation and 501(c)(3) nonprofit status including Articles of
Incorporation, and letter from Secretary of State's Office showing corporation
currently in good standing and any documentation from internal revenue service
showing tax exempt, non-profit status.
2) List of Board of Directors members and officers including contact information.
3) Project budget including a list of all financing sources. Include Copies of award letters
or other documentation of secured financing.
4) Project timeline including the date by which construction will be completed.
5) Estimates detailing the construction costs.
6) Site Plan with Building Elevations
7) Title search &/or Title Policy, Deed
8) Affordable Housing: also include unit price schedule and estimated sales price
(b) The fees eligible under the Program are:
1) Building Permit Fees:
■ Plan review;
■ Building permits;
■ Temporary power; and
■ Fence permits;
2) Roadway Impact Fees, when applicable; and
3) Utility Fees, including Water and Wastewater Impact Fees.
2. APPLICATION REVIEW PROCESS
(a) The Program grant approval will be based upon verification that the proposed project and
the applicant are eligible for the Program.
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DEVELOPMENT FEE GRANT PROGRAM
1) Applications must be complete and contain all required information.
2) Applicant must be a Qualified Nonprofit Organization (PART B. DEFINITIONS).
3) Affordable Housing Unit (PART Ba DEFINITIONS) must be an owner-occupied single
family residential home owned by or sold to an income qualified household.
4) Public Facility (PART B. DEFINITIONS) must be owned and operated by the Qualified
Nonprofit Organization or the Qualified Nonprofit Organization must have a long-term
lease agreement that extends beyond the 10-year compliance requirement,
5) Public Facility must be open to the public and have the primary purpose to serve
Denton residents with housing or human services.
6) Project cannot be in partnership with a for-profit entity.
7) All development projects must meet current City building standards and codes, as well
as building permit requirements. Project must be properly zoned and be situated
within the city limits of Denton.
8) The project will not be eligible for the Program if the homeowner owes city ad valorem
taxes or another city debt or the Qualified Nonprofit Organization if the entity owes
city ad valorem taxes, other city debt, or has code or other accessibility violations on
any previous units, facilities, or projects,
9) No grant applications will be accepted for work that has already been started or
completed, or for work that is covered by insurance.
10) Applicant cannot have any unexpended/open grant funds from any other City grant
for the same Affordable Housing or Public Facility project.
11) Project timeline should include the ability to commence construction within ninety
(90) days from the date the grant is approved and complete construction within
fifteen (15) months from the date the grant is approved.
(b) After review by City staff for compliance with the Program, an agreement will be prepared
by Community Development and presented to City Council for approval. The Denton City
Council has the final discretion regarding funding and reserves the right to modify or
reject any project or elements of any project.
(c) Upon approval of City Council, the City Manager will execute the agreement documents.
The applicants will receive the agreement and the Authorization Form as verification of
the grant award.
3. APPROVED APPLICATIONS
(a) The applicant is required to obtain all applicable City permits and City approvals required
for the construction if a grant is awarded.
(b) Applicants receiving approval shall commence construction described within the
application within ninety (90) days from the date the grant is awarded. All applicants must
complete the construction described in the application within fifteen (15) months from
the date the grant is approved.
1) If the applicant is unable to commence construction within ninety (90) days from the
date the grant is approved or complete construction within fifteen (15) months from
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DEVELOPMENT FEE GRANT PROGRAM
the date the grant is approved, the applicant may submit a written request for an
extension for the commencement date or completion date provided the extension
request is made prior to the ninety (90) day or fifteen (15) month time limit.
2) The City shall not be obligated to allow extensions but may do so for good cause
determined solely by the entity that authorized the grant. The extensions, if granted,
shall be for the term and for the conditions determined exclusively by the entity that
authorized the grant. An extension denial cannot be appealed and shall be final.
4. DENIED APPLICATIONS
An applicant whose application has not been approved by the Denton City Council shall not
be eligible to re-submit a grant application for six (6) months from the date the prior
application was declined by the Denton City Council.
5. COMPLAlNTS AND APPEALS
The Program has developed a complaint and appeals process, which can be provided to an
Applicant upon request.
6. REIMBURSEMENT
When the full development project or a portion of the project has been satisfactorily
completed and work inspected, the applicant shall present the Community Development
office with a copy of the Authorization Form and copies of all paid invoices, including copies
of cancelled checks and/or credit card receipts, for reimbursement of the funds up to the
maximum approved grant funding. In addition, the applicant must complete a City of Denton
Vendor Form and a Form 1099 to receive payment from the City. Vendor forms and 1099s
will be provided by the Community Development office.
7. INTERNAL TRANSFfR
Upon request, program grant funds may also be transferred by Community Development to
the appropriate City department upon issuance of an Authorization Form. Community
Development staff will provide the Authorization Form to the Building Official identifying the
service addresses of the Affordable Housing unit or Public Facility selected to receive grant.
The Authorization Form approving the grant funding must be provided before the issuance of
a building permit authorizing the start of construction.
8. MONITORING/COMPLIANCE
Once the grant is approved, to avoid repayment of fees, the project must meet the minimum
requirements, including:
(a) As a condition of the grant, the applicant consents and shall allow City staff to request
City inspections to determine that the grant, if awarded, will not be used for construction
on any building that is not in compliance with the City Municipal Codes and Ordinances
that are applicable to the construction contemplated in the application.
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DEVELOPMENT FEE GRANT PROGRAM
(b) Complete repair/renovation/construction within fifteen (15) months of the issuance of
the Authorization Form.
(c) Provide records and reports as requested by the City throughout the term of the
agreement.
(d) If the Single -Family Affordable Housin� Unit or Nonprofit Facility does not comply with
the terms of the agreement, note, and deed of trust, the applicant is required to repay
the grant to the City.
(e) Single-Family Affordable Housin� Units eligible for the program must meet the following
requirements:
1) The Affordable Housing unit must be a new single-family residential unit developed
by a Qualified Nonprofit Developer and/or a new or existing single-family residential
unit qualifying for a housing program supported by the City's CDBG or HOME funds.
2) The Affordable Housing unit must meet the requirements of all applicable City Zoning,
Codes and other applicable regulations.
3) The price set for the Affordable Housing unit must meet affordability requirements as
defined in PART B. DEFINITIONS.
4) Owner must be an income qualified individual or household as defined in PART A.
DEFINITIONS
5) Homebuyer(s) and homeowner(s) must own and live in the affordable housing unit
for at least ten (10) years.
6) Provide prior to sale of newly constructed:
■ Verification of the homebuyer's income eligibility and defined in PART Co
SELECTION OF PROPERTY OWNERS/SCREENING PROCESS;
■ Copy of new home contract indicating final cost of the single-family residential
unit and affordability period at least 10 years; and
■�opy of Homebuyer's Mortgage Commitment Letter.
■ Copy of Final Title search &/or Title Policy, Deed
(f) A Nonprofit FacilitV eligible for the program must meet the following requirements:
1) Provide supportive services to income eligible residents for a period of 10 years in the
assisted facility.
2) All housing, buildings and property must meet the requirements of all applicable City
Codes, Zoning, and development regulations.
(g) City reserves the right to periodically monitor the Single-Family Affordable Housin� Unit
or Nonprofit Facilitv to determine if it was transferred, sold or no longer provlding the
same services in the same location as when the reimbursement grant was provided. The
following sources of verification may be used:
■ Title report search
■ Lien and ownership search in the applicable County Clerk's Office online
records
■ Ownership verification in applicable tax office appraisal records
■ Scheduled Onsite Visit and/or Inspection
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DEVELOPMENT FEE GRANT PROGRAM
(h) If the assisted property is sold, transferred, or ownership interest in the property is conveyed
during the ten (10) year compliance period, the grant amount of assistance will become
immediately due and payable. To avoid repayment of fees:
1) If a Single-Family Affordable Housing Unit can be resold to an income eligible household,
repayment of fees will not be required. Income information for any new homeowners
that will occupy the assisted unit must be available for review by the Community
Development staff.
2) If the Nonprofit Facility is sold or transferred to another Qualified Nonprofit who will
be providing a service as described in Section 01. Nonprofit Facilities Priorities
repayment of fees will not be required.
PART B. DEFINITIONS
The following words, terms, phrases, when used in these Development Fee Grant Program Guidelines,
shall have the meanings ascribed to them in this section, except where the context clearly indicates a
different meaning:
A. Affordable Housin�:
Affordable Housing means owner-occupied single family residential homes owned or sold to a
family that qualifies for the City of Denton CDBG and HOME housing assistance programs or has
a purchase price and an estimated appraised value at acquisition that does not exceed value
limits established and published annually by U.S. Department of Housing and Urban
Development in Section 92.254(a)(2)(iii) of the Final Rule of the HOME regulations, as amended.
B. Income Qualified Individuals and Families:
An individual or family whose annual income is less than eighty percent (80%) of the area median
income, with allowable adjustments, as determined and annually updated by U.S. Department
of Housing and Urban Development. Household income cannot exceed 80 percent of the Area
Median Income Limits, adjusted for family size.
C. Public Facilitv:
Buildings and property which are owned, leased for a period that extends beyond the grant's 10-
year required compliance period and operated by a Qualified Nonprofit; or project funded by a
governmental body or public entity for the purpose of providing affordable housing or supportive
services to people in need of assistance.
D. Qualified Nonprofit:
1. A nonprofit organization that develops housing for income qualified individuals and families
as a primary activity to promote community-based revitalization of the municipality; or
2. A nonprofit corporation described by 26 U.S.C. Section 501(c)(3) that:
a. has been incorporated in this state of iexas for at least two years;
b. has a corporate purpose to develop affordable housing that is stated in its articles of
incorporation, by-laws, or charter;
c. has at least one-fourth of its board of directors residing in Denton; and
d. for a Qualified Nonprofit Developer, it must engage primarily in the building, repair, or
sale of housing for income qualified individuals and families.
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DEVELOPMENT FEE GRANT PROGRAM
E. Sin�le Family Residential:
A stand-alone single-unit family residence detached from other housing structures and does not
include a multi-family residential dwelling.
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PART C. SEIECTION OF OWNERS/SCREENING PROCESS FOR AFFORDABLE HOUSING PROJECTS
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For all Affordable Housing projects, an income packet for participation must be submitted to Community
Development Division, located at 601 E. Hickory, Suite B, and Denton, TX 76205. The packet must be
completed in its entirety and submitted together with the following documentation:
1. Household Application Form
2. Social Security Card & Photo ID – a copy of SS card for each household member plus a copy
of a state issued photo ID or driver's license for all household members 18 years and older
3. General Certification of Income - to be completed by all household members 18 years and
older
4. Income Tax Return – Current Year – Signed copy with W-2's and attachments - for each
member of household that filed a Tax Return.
• If self-employed a signed copy with W-2s and attachments will be needed for most
current 3 years.
5. Did Not File an Income Tax - to be completed by all household members 18 years and older
who did not file a Tax Return.
6. Paycheck Stubs for the last 4 Weeks - for all household members 18 years and older
7. Verification of Employment – completed by each working household member 18 years and
older
S. Social Security Income Statement - current year that states income received for each
individual and a signed Consent for Release of Information form by all household members
receiving Social Security Benefits.
9. Retirement/Pension Benefit Statement – that states current income received or a signed
Employment Retirement Request form by all household members receiving
retirement/pension benefits
10. Complete Bank Statements (Checking/Savings) for the last 2 Months for all household
members who have bank accounts, an explanation of all deposits is required, with
explanations dated and initialed by applicant.
11. Other Income Information - for all household members who have any other type of income
ex: Child Support, Insurance Policies, Self-Employment, TANF, Stocks, Bonds, 401K, Annuity,
interest income, etc.
12. Additional items as reasonably requested by the City.
Current eligible income limits: https://www.huduser.�ov/portal/datasets/il.html
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