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2002-3025:Wv Dxum~gmwCCowwv eA ORDINANCE NO. oS 0a?-, OWA AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS, APPROVING THE GUIDELINES FOR THE RENTAL REHABILITATION PROGRAM AND ELIGIBILITY CRITERIA; AUTHORIZING EXPENDITURES IN EXCESS OF $25,000 FOR PROJECTS MEETING PROGRAM GUIDELINES 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 has developed a program to rehabilitate tenant occupied housing units by making needed repairs through its Rental Rehabilitation Program, which is administered by the City of Denton Community Development Office and funded through a federal grant; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. That the City Council approves the Rental Rehabilitation Program Guidelines and eligibility criteria attached to and made a part of this ordinance for all purposes, and authorizes the City of Denton Community Development to administer this program. SECTION 2. That the City Council authorizes the expenditure of funds in excess of $25,000 by the Community Development Office for projects meeting program guidelines and criteria, subject to compliance with competitive bidding laws, where applicable. SECTION 3. That this ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this the / ' day of &rMki , 2002. cam, 94-r1k, EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: 0z' O"y I -h' , APP VED J TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: / u CITY OF DENTON RENTAL REHABILITATION PROGRAM GUIDELINES 2002 RENTAL REHABILITATION PROGRAM GUIDELINES TABLE OF CONTENTS ELIGIBILITY REQUIREMENTS: 8 II. APPLICATION PROCESSING: 9 III PROJECT SELECTION ..................................................................................................9 IV. CONTRACTOR SELECTION, MONITORING AND DEBARMENT: 10 V. PAYMENT TO CONTRACTOR: 11 VI. FINANCIAL ASSISTANCE OPTIONS: 11 VII. PROGRAM GUIDELINES: 12 VIII. MINIMUM REHABILITATION STANDARDS: 16 APPENDIX I - FAIR MARKET RENTS (FMRS)........ _ 21 APPENDIX II - RENTAL REHABILITATION PROCEDURES 22 APPENDIX III - APPLICATION FOR THE CITY OF DENTON 24 APPENDIX IV - TENANT ASSISTANCE POLICY 29 APPENDIX V - TENANT PRE NOTIFICATION SAMPLE LETTER 32 APPENDIX VI - RENTAL RERABR.rrATION TARGET AREA MAP 33 APPENDIX VII - TENANT BENEFICIARY INFORMATION TRACKING FORM 34 6 INTRODUCTION The City of Denton Rental Housing Rehabilitation Program is designed to assist low and moderate- income families in securing safe, sanitary and decent housing. This program's objective is to rehabilitate renter occupied housing units by making needed repairs with the first priority as correcting code violations. The Rental Rehabilitation Program is administered by the City of Denton's Community Development Division and funded through a federal grant. The Community Development Division is located at 100 W. Oak Street, Suite 208. The following pages contain a detailed description of the program including policies and procedures. The purpose of these guidelines is to explain to potential clients and the citizens of Denton, the Rental Housing Rehabilitation Program and types of assistance available. For further information or clarification of the guidelines, contact the Community Development Division at 940-349-7726 7 DESCRIPTION OF PROGRAM PROCEDURES ELIGIBILITY REQUIREMENTS: A. Applicant/(Owner) Requirements: Eligible property owner(s) [hereinafter referred to as Applicant] must: 1.) Be a citizen of the United States or a legal resident alien. 2.) Maintain primary residence within the city limits of Denton. 3.) Own unit(s) to be assisted within a targeted neighborhood (see Appendix VII). 4.) Hold fee simple title to the property. 5.) Have an annual gross household income at or below 150 percent of the current Dallas metropolitan area median income. (See Table LA below). 6.) Not have assets in excess of $600,000 (rental properties, personal property, cash on hand, stocks, bonds, etc.). 7.) Exhibit the financial ability to pay monthly property expenses including mortgage payments, taxes, insurance, utility bills, etc. 8.) Show proof of financial ability to fund the Applicant portion of the rehab project. 9.) Provide proof that all property taxes assessed by the various taxing agencies in Denton County are paid in full on all properties owned by Applicant. 10.) Obtain a statement of income on all tenants. Income data must be verified; i.e., by contacting the tenant's employer and/or obtaining a copy of the tenant's latest income tax return and/or obtaining copies of 1 month of paycheck stubs, etc. Annual income includes earnings (wages, pensions, etc.) spouse's earnings, interest from stocks, bonds, income from real estate, public assistance, etc. Also, include amounts of any monies regularly contributed to tenant(s) by any other adult member of the family, child support payments, SSI, etc. B. Tenant Requirements: The current and future tenants of a unit to be rehabilitated with funding from this program must be low or moderate income. Low/ Moderate income is defined as 80 percent and below of the current Dallas metropolitan area median income. (See Table I.B below) Table IA-Applicant Income Limits Table I.8 -Tenant Income Limits Household Size Maximum Owner Income 1 69,900 2 79,800 3 89,850 4 99,750 5 107,700 6 115,650 7 123,750 8 131,700 Household Size Maximum Tenant Income 1 $37,250 2 $42,550 3 $47,900 4 $53,200 5 $57,450 6 $61,700 7 $65,950 8 $70,200 8 II. APPLICATION PROCESSING: Any property owners wishing to apply for Rental Rehabilitation assistance must complete the application and all other required forms included in the proposal packet. All information on the completed applications will be verified by the Community Development staff. If any information is found to have been intentionally falsified, the application will be rejected and the applicant will not be allowed to reapply. If the applicant is determined to be eligible for the program, a preliminary inspection will be made of the dwelling unit(s). The dwelling unit(s) must meet certain standards to be considered eligible for rehabilitation. These standards are listed below: • The unit(s) must be located within the recognized Rental Rehabilitation Target Area (Appendix VII). The unit(s) must not be situated in the Designated Flood Plain Area. Applicant may not occupy any assisted unit regardless of his or her income with the exception of the circumstances set forth in Section VII-FF on page 15 of these Guidelines. The unit(s) must be in an existing condition that would permit rehabilitation to bring the structure to meet current City of Denton building codes. City-approved water supply, sanitary sewer and electrical system must service the unit(s). • The unit(s) must be two bedroom or larger. Preference will go to three bedroom and four bedroom units. • Owner must agree to have a Lead Paint Risk Assessment completed on all units to be assisted that were built before 1978 (a "hold harmless" agreement must be signed by owner before City staff can conduct the Lead Risk Assessment). III PROJECT SELECTION Project selection will be based upon an analysis of the following factors: • Location of unit(s). • Number of bedrooms. • Owner's ability to obtain private financing. • Number and extent of major health and safety violations to be corrected. • Tenant displacement (preference given to no displacement) • Economic feasibility • Amount of subsidy required • Owner's Equity in property • Potential impact on neighborhood • Track record of landlord in low income tenant placement • Management and maintenance capabilities • Quality of rehabilitation plan • Accessibility or adaptability of unit(s) for handicapped tenants • Commitment by landlord to and/or likelihood of low income tenant placement • Assisted wit(s) must be available for rental, or currently rented to low income household(s). 9 IV. CONTRACTOR SELECTION, MONITORING AND DEBARMENT: A. Contractors participating in the Rental Rehabilitation Program will be selected by the eligible Applicant. The Applicant will be required to solicit at least two bids from contractors based on the preliminary work specifications completed by the CD inspector. The Applicant shall also be responsible for supplying all bidders with a Community Development Contractor's Packet that includes the contractor information sheet, performance manual, and general specifications for workmanship, all insurance and bonding requirements, a contractor's eligibility certification form and a copy of the preliminary work write-up. Bid proposals and all other required forms from the contractors should be submitted to Community Development Division for review. B. Acceptable bid proposals must fall within a ten percent (10%) margin of the cost estimate developed by the community development inspector. THE CITY OF DENTON AND/OR THE APPLICANT RESERVE THE RIGHT TO REJECT ANY AND ALL BIDS. Any contractor whose name appears on the most current HUD Debarred Contractors List will not be eligible to participate in this program. C. Once the contractor has been selected and approved, a contract agreement must be signed. Before the contractor can start work, the Applicant must issue a notice to proceed. D. The Applicant, the Community Development staff and the City of Denton building code inspectors will monitor the contractors work. If the Applicant considers any work done by the contractor to be unsatisfactory or incomplete, the property owner should advise the contractor of the discrepancy and ask that it be corrected. E. Acceptance of Work 1.) Final Inspection - In order for the contractor to close out a rehabilitation job, a final inspection shall be made by the City of Denton building code inspector, the Community Development Inspector, and the property owner. If the final inspection results in no additional work or no specked corrections, the property owner shall sign the contractor's release form which states that all work has been completed to their (property owner's) satisfaction. The building code inspector shall sign a final inspection form to confirm the same. At this time, the contractor is required to submit to the property owner copies of all warranties and releases of liens from subcontractors and suppliers. The Community Development staff will not authorize payment to the contractor until these documents are properly completed and submitted to the property owner and copies provided to the Community Development Division. 2.) Warranty of Work - As stated in the rehabilitation contract, the contractor shall guarantee the work performed for a period of at least one year from the date of final acceptance. The owner is responsible for periodic review of the work. Contractor Debarment 1.) A contractor will be declared ineligible to participate in projects funded by the City of Denton's Housing Rehabilitation Program for one or more of the following causes: 2.) Failure to complete a project within the prescribed contract period. 3.) Failure to complete warranty repairs within a reasonable time period. 4.) Failure to use licensed plumbing and electrical subcontractors. 5.) Failure to obtain proper insurance, i.e., both liability and worker's compensation. 10 6.) Failure to complete work in accordance with program specifications and/or accepted standards of workmanship. 7.) Failure to pay all subcontractors working on the project appropriately and/or submit affidavits of payment signed by all subcontractors. 8.) Failure to obtain proper permits for work in progress. G. Contractors will be notified of their proposed debarment and will be afforded the opportunity to comment or appeal the action. Ali appeals must be made in writing to the Community Development Division at least 15 days after the date of the notification letter. V. PAYMENT TO CONTRACTOR: A. The contractor shall receive payment for all completed contracts within 15 working days after final inspection and approval of all work. Ten percent (10%) of the total contract amount will be withheld for 30 days. At the end of this time, the property owner must approve release of contingency funds. B. An "All Bills Paid" affidavit or release of lien from all subcontractors and suppliers must be submitted before payment. Rental rehabilitation partial payment minimum are as follows: projects over 50,000 at least 10% per draw, projects under 50,000 50% and final payment. VI. FINANCIAL ASSISTANCE OPTIONS: Applicant is provided with two assistance options: Option 1: The City of Denton will provide 25 percent (or up to the maximum limit-whichever is lower) of the amount needed to rehabilitate the property. Funds will be provided as a 10-year deferred loan. At the end of the 10-year period, if all program guidelines have been met, the loan will be forgiven. Option 1 Maximum Limits: $6,000 for three or more bedroom units. $5,000 for two bedroom units. (One-bedroom units are not eligible for assistance.) Option 2: The City of Denton will provide 50 percent (or up to the maximum limit-whichever is lower) of the amount needed to rehabilitate the property. The first 25 percent will be a deferred loan (as described in option 1 above). An additional amount of 25 percent (or up to the maximum limit - whichever is lower) will be a loan with a 2 percent interest rate. There will be a 10-year loan term. Option 2 Maximum Limits: $6,000 as a loan and $6,000 as a deferred loan for three or more bedroom units. $5,000 as a loan and $5,000 as a deferred loan for two bedroom units. (One-bedroom units are not eligible for assistance.) Applicants are required to sign a contract. A lien will be placed on the property for the 10-year period. Applicants are required to maintain the property and affirmatively market the property to low and moderate-income households. * All project funding contributed by the Applicant will be placed in an escrow account with the City of Denton prior to contract execution. The owner must also comply with the terms of the note and mortgage that include the following: 11 No conversion to condominiums or any, type of cooperative ownership for the 10-year duration of the lien. No discrimination against tenants receiving Federal, State or local rental assistance for the 10-year duration of the lien. The project must be maintained according to adopted City of Denton building codes in effect during the year in which the rehabilitation took place. The owner must affirmatively market vacant units for the ten-year duration of the lien using the "fair housing logo" below. EQUAL HOUSING OPPORTUNITY The unit will be made available and leased to persons whose income is at or less than 80% of the area median income. If the Applicant violate any of these restrictions, the entire amount of the loan less 10% for each full year after completion of the rehabilitation of the units until the time of default, will be due and payable in full immediately after the owner is notified that the loan must be repaid. VII. PROGRAM GUIDELINES: A. Property owner agrees to comply with all HUD requirements to not discriminate upon the basis of race, ethnicity, religion, gender, disability status or family status in the sale, lease, rental, or use of occupancy of the subject property. B. Property owner agrees to not award any contract for rehabilitation work to be paid for in whole or in part with the proceeds of the grant, to any contractor who, at the time, is ineligible under the provisions of any applicable regulations issued by the Secretary of Labor, United States Department of Labor, or the Department of Housing and Urban Development to receive an award of such contract. C. The tenant will continue to occupy the premises during the rehabilitation. Any tenant required to move temporarily or permanently as a result of the rehabilitation*, must be paid relocation/displacement costs as outlined in the City's Tenant Assistance Policy (Appendix IV to these Guidelines). *Any displacement of tenant(s) living in unit(s) at the time applicant decided to apply for funding who move because of their inability to pay increased rents, are considered displaced. Displacement costs are the responsibility of the property owner. D. Property owner agrees that existing house utility services will be made available to the contractor without charge as follows: electricity, gas, water and telephone (local calls only). E. Property owner agrees that the City shall be the agent for the owner and as such agent shall hold both the owner's private funds and all grant funds in escrow for the purpose of disbursement thereof to the contractor. F. Property owner agrees that it is his/her sole responsibility to see that the contractor completes the work specified in his contract to the owner's satisfaction and that the City of Denton has no responsibility for any defects, faulty work or incomplete work by the contractor. The owner 12 further agrees that the City has,no liability for warranty of any of the workmanship or materials furnished by the contractor und6r the contract. The owner further agrees that latent or hidden conditions in the property which were not included in the original inspection and work write-up of the City are not the responsibility of the contractor nor of the City, but remain the responsibility of the owner. G. As part of the consideration for providing the funds to rehabilitate property as described herein, the property owner agrees to maintain and keep the property in good repair after the completion of the work to be performed by contractor, taking into consideration the ability of the owner to do so. The property owner also agrees to maintain the property up to City of Denton Building Code standards that were in effect when the rehabilitation was completed. Owner agrees to do this during the term of the loan agreement and understands that if at anytime the property fails to meet these Code standards, the loan amount will become due immediately. H. The owner shall issue a written Notice to Proceed within thirty (30) days from the date of acceptance of the contractor's bid and proposal. If the contractor does not receive the Notice to Proceed within this 30-day period, the contractor has the option of withdrawing his/her bid and proposal. If the contractor chooses to do this, a written notice must be delivered to the owner with a copy to the City. The contractor shall not begin the work to be performed until receipt of written Notice to Proceed from the owner after which the contractor shall begin the work within ten (10) calendar days of the date of said Notice and shall complete said work within ninety (90) days or as agreed to in the Rehabilitation contract. The contractor shall not assign the contract without written consent of the owner and the City and/or its agent. J. The contractor shall not be responsible for any delays in the completion of work due to the following: 1.) Any acts of the government; including controls or restrictions upon or requisitioning of materials, equipment, tools or labor by reason of war, National Defense or any other national emergency. 2.) Any acts of the owner. 3.) Causes not reasonably foreseeable by the parties to this contract at the time of the execution of the contract which are beyond the control and without the fault or negligence of the contractor; including but not limited to acts of God or of the public enemy; acts of another contractor in the performance of some other contract with the owner, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes and weather of unusual severity such as hurricanes, tornadoes, etc. 4.) Any delay of the subcontractor occasioned by any of the causes specified in Subparagraphs (A) (B) and (C) above, provided that the contractor promptly (within 10 days) notifies the Owner in writing of the cause of the delay. If the facts show the delay to be properly excusable, the owner shall extend the contract time by a period commensurate with the period of excusable delay. K. The contractor shall not be held responsible for preexisting violations of law including but not restricted to zoning or building code regulations at the property listed in the contract. Before beginning work, the contractor shall examine the work write-up for compliance with the applicable ordinance and codes for the new or replaced work and shall immediately report any discrepancy to the owner. Where the requirements of the work write-up fail to comply with such applicable ordinances or codes for the new or replaced work, the owner and the City will adjust the contract by change order to conform to such ordinances or code and make appropriate adjustment in the contract price unless waivers in writing covering the difference have been granted by the proper authority. 13 L. The contractor shall comply with all non-discrimination clauses included in the contract; non-compliance may result in termination of the contract. M. Bids or proposals will be submitted at the bidder's risk and the City and/or the owner reserve the right to decline funding for projects not in compliance with the guidelines. N. Subcontractors shall be bound by.the terms and conditions of the contract, insofar as it applies to their work. This shall not relieve the general contractor from the full responsibility to the owner for the completion of all work to be executed under this agreement and he shall not be released from this responsibility by any subcontractual agreement he may make with others. 0. When adjacent property is affected or endangered by any work done under this contract, it shall be the responsibility of the contractor to take whatever steps are necessary for the protection of the adjacent property and to notify the owner thereof of such hazards. P. Repairs shall be made to all surfaces damaged by the contractor resulting from his/her work under this contract at no additional cost to the owner. Where "repair of existing work" is called for by the contract, the feature shall be placed in "equal to new condition" either by patching or replacement. Al damaged, loose or rotted parts shall be removed and replaced and the finished work shall match adjacent work in design and dimension. Q. After the final inspection and acceptance by the owner of all work under the contract including cleanup, the contractor shall submit to the owner for approval a requisition for payment. When the required warranties and other required documents have been submitted and the contractor has executed the release of liens, the final payment will be made. The payment will include any amounts remaining due under the contract as adjusted in accordance with approved change orders. Payments will be made within 15 days of formal requisition for payment. Partial payments will be made at discretion of the owner with the consent of the City. R. A Rehabilitation Loan may be made to cover the cost necessary to bring the dwelling into conformance with City of Denton Codes. The two categories of repairs listed below are to be included as priority items: 1.) Required Repairs: Code violations which create hazardous conditions in regard to safety or health will generally involve the basic heating, plumbing or electrical systems. 2.) Recommended Repairs: Code corrections or preventive maintenance efforts which should be undertaken to avoid more costly future action. 3.) Heating, plumbing and electrical improvements 4.) Weatherization 5.) Exterior work such as roofing, siding, painting, step and porch repair and retaining walls 6.) Interior work such as renovation and repair of existing kitchen and bath facilities. S. The Denton Central Appraisal District automatically reappraises any house where a building permit is issued. Participants in the Rehabilitation Program should be aware that the appraised value of their property might increase which consequently may cause their yearly property taxes to increase. The policy shall be thoroughly explained to any person applying for rehabilitation assistance. T. Change orders may be made to cover an item of work that cannot be determined until sometime during the course of the rehabilitation work. Change orders will be considered as follows: 1.) Change orders are used to add work necessary to correct incipient items that have been found to be defective after work is in progress but were not anticipated at the time the contract was executed. 14 2.) The change order amount is limited to a maximum of 10 percent (10%) of the total contract amount. If it is necessary to request a change order to make required repairs and the contract is already at the maximum amount, a work item of less priority will be deleted from the bid proposal in order to compensate for the added amount. 3.) Change orders will be used when it is necessary to delete work from a contract for any reason. When items are deleted from the contract, they shall be at their previously bid amount. When items are deleted, but do not have specific costs, in such cases the contract shall be reduced by negotiating the cost at prevailing rates. 4.) All change orders shall be executed by the property owner, contractor, and a Community Development official. 5.) Except for the purpose of affording protection against any emergency endangering fife or property, the Contractor shall make no change in the work or rehabilitation, provide any extra or additional work or supply additional labor, services or materials beyond that actually required for the execution of the contract. 6.) All change order requests must be submitted by the contractor, signed by the homeowner and approved by Community Development Division. No claim for an adjustment of the contract price by the contractor or homeowner will be valid unless this is done. 7.) The approval of a change order shall constitute authorization by the property owner and Community Development to change the loan amount equal to the cost of the work added or deleted, unless all available funds have been utilized. If this is the case, the owner must absorb the total cost or delete non-code items in order to pay for the work described in the change order. 8.) It may be necessary to change the time of completion due to the addition of certain work items or delays that are beyond the contractor's control. U If the work completed is not in accordance with the construction contract, Community Development shall advise the property owner of the non-compliance who then shall obtain appropriate action from the contractor. No payment shall be processed on a construction contract until a contractor has satisfactorily completed all necessary corrective action. V. The owner shall be able to select the color and style of certain materials (i.e. carpet, floor covering, paneling, paint, etc.). W. The contractor warrants that all materials, fixtures, and equipment furnished by the contractor and its subcontractors shall be new, of good title and that the work will be done in a neat and workmanlike manner. Neither the final payment nor any provision in the contract nor partial or entire use or occupancy of the premises by the owner shall constitute an acceptance of work not done in accordance with the Contract or relieve the Contractor of liability in respect to any express warranties or responsibility for faulty materials or workmanship. The contractor shall promptly remedy any defect in the work and pay for any damage to other work resulting therefrom that may appear within a period of one year from the date of final acceptance of the work unless a longer period is specified. The owner will give notice of observed defects with reasonable promptness. X. Mobile homes are not eligible for rehabilitation. Y. Interest of certain federal and other officials: 1.) No member or Delegate to the Congress of the United States and no Resident Commissioner and no federal employee shall be admitted to any share or part of this contract or to any benefit to arise from same. 1s 2.) No member of the governing body of the City and no other public official of or within the City or County who exercises any functions or responsibilities in connection with the administration of the Community Development Block Grant Program and no other employee of the Economic Development Department who exercises any such functions or responsibilities shall have any interest, direct or indirect, in rehabilitation proceeds which is incompatible or in conflict with the discharge or fulfillment of his functions and responsibilities in connection with the carrying out of the Housing Rehabilitation Program. The length of time this exclusion shall be in effect is one (1) year following the ending of term of office and shall be binding upon, but not limited to, all of the individuals and agencies herein described. Z.. The property owner agrees that for a period of ten years after the project is completed not to convert the rehabilitated units to condominium ownership. If the owner does convert rehabilitated units to condominium ownership, the entire loan amount shall be due immediately. AA. The property owner agrees not to discriminate against prospective tenants on the basis of their receipt of or eligibility for, housing assistance under any Federal, State or local housing assistance program; on the basis that the tenants have a minor child who will be residing with them; or on the basis that they are handicapped. BB. Applicant agrees to rent all assisted units to households whose total gross annual income is at or below 80 percent of the area median income found in Table I.B, page 7 of these guidelines (see "note" below). Applicant agrees to track tenant income and beneficiary data (See Appendix VII -Tenant Income and Beneficiary Tracking Form). This form is to be made available to the Community Development Division when requested. The Form is to be completed at the time assisted units are leased. (NOTE: Income Limits may change annually - usually on October 1 s`. It is the Applicant's responsibility to request a copy of the most current income limits from the Community Development Division.) CC. The property owner agrees to maintain the rehabilitated property up to adopted City of Denton Building Code Standards in effect the year in which the rehabilitation was completed. This will be applicable for a period of at least ten years after the project is completed. DD. The property owner agrees to comply with applicable lead-based paint regulations. EE. The property owner agrees to comply with the City of Denton's Tenant Assistance Policy, including execution of all tenant notifications outlined in the policy. Copies of all tenant correspondence regarding this project must be submitted to the Community Development Division. FF. When the property to be rehabilitated is a td- or four-plex, and the owner/applicant meets the income limits for tenants (see Table I.B on page 7 of these guidelines), the owner/applicant is eligible to occupy one of the assisted units. VIII. MINIMUM REHABILITATION STANDARDS: Roofs Roofs should not leak and have no evidence of rotted decking, fascia or soffit. Any roof with two or more layers of roofing must be stripped to the decking. If it is determined a new roof is necessary the decking must be checked for broken or rotted decking and shall be repaired or replaced as needed. Where new decking is required the material shall be one-half inch plywood or one-half inch wafer board to be used with H clips between sheets. All roofs that are stripped shall be replaced with new felt paper, the proper flashing and metal drip edge with 240 pound shingles. Any roof with less than a 4/12 pitch shall be covered with rolled roofing, with at least 12 inches of lap, if installation of rolled roofing is not sufficient to promote proper run off roof will be rebuilt. Siding and Trim 16 All exterior siding and trim shall be free;of holes, cracks or rotted material that might admit moisture into walls. New siding may be applied only if the cost of new siding and installation is comparable to the repair and painting costs of the existing siding. Windows All windows and hardware shall operate satisfactorily. Cracked or broken windows shall be replaced. Window glazing shall be weather tight and windows shall be weather stripped so as not to allow entry of air and water around the glass, sashes or window casings. All windows shall have screens and working locks. Drainage The grade of concrete or dirt should drain at least five feet away from foundation walls. Site Improvements All replaced concrete surfaces are to be level with the widths to match the existing surfaces. All steps both concrete or wood that pose a threat to the occupants shall be repaired or, if necessary, replaced with treated material or concrete. Foundations and Piers Skirting shall be six (6) inches underground level. If it is necessary to install skirting, new 22 or 24 gauge skirting shall be used. Kitchens Kitchens shall have a specific area that contains a sink with hot and cold running water, counter workspace, and space for storage of cooking utensils. Stairs All stairs shall provide for the safety of ascent and descent. All treads and risers should show no evidence of breakage or have evidence of excessive wear. All stairs shall be equipped with handrails. Utility Areas Gas or oil fired water heaters or furnaces shall not be located in the bathrooms or bedrooms. In addition to all plumbing and electrical codes, water heaters and furnaces shall be enclosed with a sealed door and adequate upper and lower combustion air. All washer and dryer hookups must meet City Code. Structural System The wood, masonry or steel components shall be in serviceable condition for the expected useful life of the rehabilitated building. Structural members that are in seriously deteriorated condition shall be replaced. Sagging and unleveled floors shall be raised and stabilized as level as possible without causing interior damage. Termite inspection and treatment shall be done if evidence of active infestations exist. A certified pest control company will carry out the treatment and present documents of proof. Electrical System 17 All replacement of existing wiring and equipment shall be done in conformance with the National Electric Code and the City of Denton Code. And potential source of electrical hazard or ignition of combustible material shall be corrected. GFCI outlets shall be used in bathrooms, kitchen, garage, and exterior receptacles. Additional outlets shall be added to eliminate extension cords and, at the request of the City Inspector, to meet City Codes. Plumbing The plumbing system shall operate free of fouling and clogging, and not have cross-connections which permit contamination of the water supply or back siphonage between fixtures. All sinks, lavatories, water closets, water heater, and other plumbing fixtures shall have accessible cutoff valves. All fixtures shall have P-traps, necessary vents and be properly connected to a public or private sewage disposal system. All sewer lines shall have accessible cleanouts. All water heaters shall be installed with double wall vent stack, a pop-off valve, and overflow to the exterior of the structure. Mechanical Equipment All gas fired heating units must be vented with double wall pipe and proper upper and lower combustion air. The unit shall not be installed in a living area such as bedrooms or under stairways. Rigid gas pipe must be used to supply heating units with a maximum of three (3) feet of flexible pipe from the stop to the appliance. All ductwork shall be properly sealed from the heat source to the register vent and from the return air supply to the heat source. A gas pipe pressure test is required. All leaks must be repaired. Insulation and Weatherization An "R-30" insulation value in the attic shall be required. Exterior Doors All exterior doors shall be solid core. All locks shall be capable of tightly securing the door and shall be readily operable from the inside without the use of keys. All exterior doors shall be weather stripped so that there is no significant entry of air or water into the structure. Porches and Decks All porches and decks shall be safe and capable of supporting anticipated loads. All porches and decks in deteriorated condition and which serve no useful purpose or which are not economically repairable shall be removed. Porches and decks 30 inches above grade shall have guardrails and flights of stairs with four or more risers. They shall have a handrail on at least one side. Gutters and Downspouts Gutters and downspouts should exist where they are deemed necessary to promote proper drainage. Gutters will not normally be installed if they do not already exist. Downspouts that cannot be connected to drain tiles shall have splash backs with proper site grading. Chimneys and Vents Furnace and water heater vents shall be double wall vent pipe. Existing unlined masonry chimneys having open mortar joints or cracks shall be removed or made safe by installation of a UL approved flue liner. 18 Vent-a-hood stacks shall be vented through the roof. Interiors All floors, walls, and ceilings shall be maintained in good, clean, and sanitary condition. All peeling paint, cracked or loose plaster, and other defective surface conditions shall be eliminated. All doors shall be operational. Carpet and vinyl that is badly wom, tom or too dirty to be cleaned shall be replaced. This shall be determined by the C.D. Inspector. Existing carpet shall be cleaned with a commercial steam cleaner, if necessary. Bathrooms An operational water closet, tub or shower, and lavatory should be in the bathroom. Hot water should flow to the lavatory and tub or shower. Cold water should be supplied to all fixtures. Either a window or an exhaust fan must be present to properly vent the bathroom. Cabinets Built-in kitchen cabinets shall be repaired up to 50 percent of the cost of new cabinets. Bathroom cabinets are not required. ALL WORK MUST COMPLY WITH HUD TITLE X REGULATIONS REGARDING LEAD - BASED PAINT. BY APPLYING FOR CDBG FUNDS, OWNER/APPLICANT UNDERSTANDS THE CITY MUST COMPLETE A LEAD RISK ASSESSMENT TO DETERMINE THE SCOPE OF WORK AND COST ESTIMATE ON PROPERTIES BUILT BEFORE 1978. FOR PROPERTIES BUILT BEFORE 1978, OWNER / APPLICANT MUST EXECUTE AN ACKNOWLEDGEMENT AND RELEASE OF LIABILITY FOR LEAD PAINT TESTING OF PROPERTY. 19 20 APPENDIX 1 FMR's a 2 LL F~ W a LL !C 0 W CL CL Q N N x F N f0 w .D d O M a a R c LL N O O N U. U. to O O LO N ❑ Cl) W Go~ m -Rt U 2 O O o ~ N ❑ W ~ m M N O O ~ O ❑ co W e» m N 2 O 0 Cl) Gr~ m G O O Ix 00 ❑ 9 W ~ m O W N Q X z W m Q D N m C7 N Q O ❑ F o Q co (n 9 Page 21 APPENDIX II - RENTAL REHABILITATION PROCEDURES The following list of procedures is designed to insure that property owners understand their responsibilities under the Rental Rehabilitation Program. Please call the Community Development Division at (940) 349-7726 if you have any questions regarding these procedures. 1.) Return completed application. Include a copy of property deed, tax receipts from all taxing entities, proof of insurance coverage on the property and documentation of all owner(s) income and assets*. 2.) A set of work specifications must be drawn up by the owner and approved by the Community Development Division. 3.) The owner of the proposed property will bear the responsibility of contacting at least two general contractors, who will submit bid proposals. These proposals must remain within a margin of ten percent of the estimate determined by the Community Development Division. 4.) Upon project approval, a title search must be submitted. 5.) Certification that all tenants have received timely written notice that they will not be displaced by the project must be submitted within two weeks of application submission. A copy of the City of Denton's Tenant Assistance Policy must accompany the notice to the tenant. 6.) Requests for all interim and final payments should include an itemized list of completed work and its cost and two "Requests for Payment" signed by both the property owner and the contractor. IT IS THE CONTRACTOR'S RESPONSIBILITY TO FILE ALL NECESSARY PAPERWORK WITH COMMUNITY DEVELOPMENT DIVISION 7.) A final inspection must be completed by Community Development Division. 8.) Final payment is contingent on receipt of the following by Community Development: a) signed affidavits from all subcontractors stating that they have received full payment b) affidavit from general contractor and signature on lien assignment c) two executed requests for payment *Documentation of income sources may include but is not limited to the following: Current year's income tax Return with W-2's for each household member who has filed tax returns. APPENDIX II PAGE 22 • Most current Social Security income statement if applicable. • Paycheck stubs for last four weeks for each employed household member. • Names and addresses of all retirement income or any other income sources (ALL INCOME SOURCES AND ASSETS MUST BE DISCLOSED--RETIREMENT, RENTAL HAP INCOME, AFDC, FOOD STAMPS, PROPERTIES OWNED, ETC.) • Divorce decree if you receive child/other support from a divorce or if you were awarded property through a divorce. • Name, address, account number(s) of all banks, credit unions, savings banks, IRA accounts, etc. for all household members who have any such accounts. APPENDIX II PAGE23 APPENDIX III -APPLICATION FOR THE CITY OF DENTON RENTAL. HOUSING REHABILITATION PROGRAM OWNER PROPOSAL FORM CONTACT AGENCY: COMMUNITY DEVELOPMENT DIVISION 100 W. OAK, SUITE 208 DENTON, TX 76201 TELEPHONE NO. (940) 349-7726 PLEASE COMPLETE ALL SECTIONS OF THIS OWNER PROPOSAL FORM. IF YOU NEED ASSISTANCE IN COMPLETING THE FORM, CONTACT THE AGENCY LISTED ABOVE. SECTION I: OWNERSHIP DATA A.COMPLETE THE INFORMATION BELOW FOR ALL OWNERS OF THE PROPOSED PROPERTY. NAME STREET ADDRESS CITY STATE ZIP (AC) Phone # B. TYPE OF OWNERSHIP (check one): ❑ (a) Sole Owner ❑ (c) Corporation ❑ (e) Other: C. PROPERTY ADDRESS: D. BUILDING DESCRIPTION ❑ (b) Partnership ❑ (d) Limited Partnership No. Street Unit No(s). City APPENDIX III PAGE 24 1 ❑ Single Family ❑ Duplex ❑ Tri-Plex ❑ Four-Plex E. BUILDING STRUCTURE ❑ Frame ❑ Brick ❑ Masonry ❑ Other: F. FOR EACH UNIT IN THE PROJECT PLEASE PROVIDE THE INFORMATION REQUESTED IN THE FOLLOWING TABLES. The following information must be provided on all existing tenants. Applications will not be processed until all tenant information is received. Tenant's Name Curren Rent Apt. No. No. Occupants Over 65 Ethnic Code *FEM HHH Handi- Capped Section 8 Income ..vin. mr me more mo ve, use me muowmg canes: Ethnic Codes: 1 - White 2 - Black 3 - Amer. Indian/Alaskan Native 4 - Asian Pacific Islander 5 - Hispanic 6 - Other * Please note a female head-of-household is a single female with dependent children. Section 8 recipient Codes: C - Certificate V - Voucher N - None A. NOTE: PROVIDE INFORMATION FOR ALL UNITS UNIT NUMBER NUMBER OF BEDROOMS, EXISTING NUMBER OF BEDROOMS, AFTER REHABILITATION CURRENT RENT PROJECTED RENT AFTER REHABILITATION UNIT OCCUPIED (O) OR VACANT SECTION II: PROPERTY DATA B. ORIGINAL MORTGAGE APPENDIX III PAGE 25 Orig.'Amount Mortgagee Balance C. OTHER LIENS Amounts Lien Holder Total Due D. ORIGINAL PURCHASE PRICE E. DATE OF PURCHASE F. ESTIMATED MARKET VALUE OF PROPERTY (Attach recent appraisal) G. DOLLAR AMOUNT OF RECENT CAPITAL IMPROVEMENTS DESCRIBE IMPROVEMENTS BELOW: H. AMOUNT OF INSURANCE COVERAGE 1. NAME OF INSURANCE COMPANY (Attach copy of policy) J. AMOUNT OF RENTAL REHABILITATION FUNDS REQUESTED FROM CITY K. FINANCING OF OTHER REHABILITATION COSTS NOT COVERED BY THE RENTAL REHABILITATION PROGRAM 1. AMOUNT OF ESTIMATED OWNER COSTS FOR REHABILITATION TO BE PAID FROM OWNER'S FUNDS (EQUITY): 2. AMOUNT TO BE BORROWED FROM PRIVATE LENDING INSTITUTION: NAME OF LENDING INSTITUTION: 3. ANTICIPATED INTEREST RATE AND LOAN PERIOD: % for years APPENDIX III PAGE 26 SECTION III: PROPERTY OWNER INCOME DATA Note: Owner income eligibility is based on household income which includes the income of all worldng members of the household. If the property is owned by a partnership or corporation, all partners and/or principals must be income eligible. Please list all income amounts below and provide documentation of each income source. (To be completed by all households with ownership in the property.) Income Type Owner Household Member #1 Household Member #2 (please attach additional sheet if needed) Total Salary Overtime pay Fees/tips Commissions/bonuses Interest and/or dividends Net income from business Net rental income Social Security, pensions retirement Unemployment benefits, workers compensation, etc. Alimony, child support Welfare pymts, AFDC, food stamps, etc. Assets Checking accounts Savings/CD accounts Stocks, bond, etc. Rental property income Value of private residence Life Insurance Other APPENDIX III PAGE27 SECTION IV: CERTIFICATION THE OWNER/CO-OWNER CERTIFIES: (1) THAT HE/SHE HAS READ THE RENTAL REHABILITATION PROGRAM GUIDELINES AND UNDERSTANDS THE PROCEDURES AND REGULATIONS DESCRIBED THEREIN; (2) THAT HE/SHE AGREES TO ABIDE BY THOSE PROCEDURES, REGULATIONS, AND CONDITIONS; AND (3) THAT THE INFORMATION CONTAINED IN THIS APPLICATION AND PROPOSAL IS TRUE, CORRECT, AND COMPLETE. THE APPLICANT AGREES NOT TO DISCRIMINATE UPON THE BASIS OF RACE, AGE, GENDER, DISABILITY, FAMILY STATUS, CREED OR NATIONAL ORIGIN IN THE SALE, LEASE, RENTAL, USE, OR OCCUPANCY OF THE REAL PROPERTY REHABILITATED WITH ASSISTANCE FROM THE RENTAL REHABILITATION PROGRAM. VERIFICATION OF ANY OF THE INFORMATION CONTAINED IN THIS APPLICATION MAY BE OBTAINED FROM ANY SOURCE NAMED HEREIN. THE APPLICANT CERTIFIES THAT HE/SHE HAS NOT REQUIRED ANY TENANT TO MOVE WITHOUT CAUSE, SUCH AS VIOLATION OF THE LEASE OR LOCAL LAW DURING THE 12 MONTHS PREVIOUS TO THE DATE OF THIS APPLICATION. Owner's Signature Social Security Number Date Co-Owner's Signature Social Security Number Date ITEMS TO INCLUDE WITH THIS APPLICATION: 1. A COPY OF THE DEED. 2. PICTURE(S) OF THE BUILDING AND, IF AVAILABLE, PICTURES OF THE INSIDE OF THE UNIT(S). 3. PROOF THAT PROPERTY TAXES AND ALL UTILITIES ARE PAID IN FULL. INCLUDE A RECENT TAX STATEMENT SHOWING PROPERTY VALUE. 4. DOCUMENTATION OF OPERATING EXPENSES, TAXES AND INSURANCE. 5. SIGNED LETTER FROM ALL EXISTING TENANTS STATING THEY HAVE RECEIVED A COPY OF THE TENANT ASSISTANCE POLICY AND UNDERSTAND THEIR RIGHTS ACCORDING TO THE POLICY. A COPY OF THE POLICY AND A SAMPLE LETTER ARE ATTACHED. 6. INCOME DOCUMENTATION and COMPLETED AND SIGNED INCOME VERIFICATION FORMS. APPENDIX III PAGE 28 Community Development Division I&Lm APPENDIX IV -TENANT ASSISTANCE POLICY Rental Rehabilitation Program Introduction The regulations for the Rental Rehabilitation Program (24 CFR 511.10(h) require grantees to adopt a written Tenant Assistance Policy. The purpose of the Tenant Assistance Policy is for the grantee to articulate how it will assist tenants currently living in or moving into projects rehabilitated under its Rental Rehabilitation Program. City of Denton residents have been made aware that the policy exists and that the policy is available to tenants in projects selected for rehabilitation. Definition of Displacement The term "displaced person" means any person that moves from real property, or moves personal property from real property, permanently and involuntary as direct result of rehabilitation, demolition or acquisition for a Rental Rehabilitation Program project. Permanent, involuntary moves for a Rental Rehabilitation Program project include: A. A permanent move from the real property following notice by the property owner to move permanently from the property, if the move occurs on or after the date that the owner submits a request for Rental Rehabilitation Program assistance that is later approved and funded. B. A permanent move from the real property that occurs before the submission of the request for assistance to the City, if either the City or HUD determines that the displacement resulted directly from rehabilitation, acquisition, or demolition for the project. C. A permanent move from the real property by a tenant-occupant of a dwelling unit that occurs after the execution of the agreement between the owner and the tenant if, The tenant has not been provided a reasonable opportunity to lease and occupy a suitable, decent, safe and sanitary dwelling in the same building/complex following the completion of the project at a rent, including average utility costs that does not exceed the greater of: The tenant's rent and estimated average utility costs before the execution of the agreement between the City and the owner or the total tenant payment as determined under 24 CFR 813.107, if the tenant is lower income, or 30% of gross household income if the tenant is not lower income, or; 2. The tenant has been required to relocate temporarily but: The tenant is not offered payment for all reasonable out-of-pocket expenses incurred in connection with a temporary relocation, including the cost of moving to and from the temporarily occupied housing and any increased rent and utility costs, or other conditions of APPENDIX IV Page 29 the temporary relocation are not reasonable, and the tenant does not return to the building/complex or; 3. The tenant is required to move to another unit within the building/complex but is not offered reimbursement for all reasonable out-of-pocket expenses incurred in connection with the move or other conditions of the move are not reasonable. A person does not qualify as a displaced person, however, if the person has been evicted for cause based upon a serious or repeated violation of material terms of the lease or occupancy agreement and the City determines if the eviction was not undertaken for the purpose of evading the obligation to provide relocation assistance or the person moved into the property after the owner's submission of the request for assistance but, before commencing occupancy, received written notice of the owner's intent to terminate the person's occupancy for the project or the person is an owner-occupant who moves as a result of the rehabilitation of the real property or the person is ineligible under 49 CFR 24.2(g)(2) or the City determines that the person was not displaced as a direct result of the acquisition, rehabilitation or demolition for the project and the HUD office concurs in that determination. ll. Relocation Assistance Relocation assistance is available to tenants from two sources: A. Rental rehabilitation funding as provided in CFR 511.10(g) (iv). B. Section 8 assistance provided by the Denton Housing Authority Permanent Relocation Assistance Moving expenses will be provided to a family or individual displaced from any dwelling. They may, at their discretion, choose either a payment related to actual moving expenses or the fixed moving expense and dislocation allowance indicated in the federal register by the Department of Transportation. Replacement housing assistance can be taken in one of two ways: Tenants will be screened to determine if the family is eligible to receive a housing voucher/certificate. When available, housing vouchers/certificates will be offered to families who are permanently displaced. In the absence of vouchers/certificates or when a tenant is found to be ineligible (if for reasons other than not being low income), the Public Housing Authority will provide at least one referral to an available decent, safe, and sanitary unit. Tenants eligible for a replacement housing payment may also elect to obtain a cash payment which will allow them to rent a comparable replacement dwelling for a 42-month period or purchase a replacement dwelling. Tenants eligible for a replacement housing payment include: Those displaced from a dwelling occupied at least 90 days prior to the execution of an agreement between owner and the City and, 2. Those displaced from a dwelling that they did not occupy for at least 90 days immediately before the execution of the agreement between the owner and the granteetrecipient. Generally, replacement housing payments will be the monthly rent and average utility costs at the displacement dwelling or 30% of the tenants average monthly gross income. If a gap exists between the new cost of housing with Section 8 assistance and the old costs, replacement housing payments will be made to cover the gap. Temporary Relocation Assistance APPENDIX IV PAGE 30 All tenants temporarily relocated from their residence will be reimbursed for all out-of-pocket expenses incurred in connection with the move. III. Provisions of Assistance Tenant Assistance will be provided from three sources A. The property owner - The property owner will be charged with informing his/her tenants of their rights under the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (URA). The property owner will provide the Community Development Division with evidence of communication to tenants concerning these matters. B. Community Development Division - The Community Development staff will be responsible for counseling tenants regarding the appropriateness of replacement housing payments. Community Development staff will also be responsible for complaint resolution and referral of tenants to the DHA for additional assistance. C. The Denton Housing Authority - The DHA will perform the following tests related to tenant assistance: 1) certifying eligibility of tenants, 2) issuing vouchers/certificates, 3) notifying and counseling tenants of their rights and rules of participation, and 4) identifying suitable replacement dwellings. IV. Denton Housing Authority Policies The DHA provides counseling and application assistance at their office located at 308 S. Ruddell. Applicants including all income verifications must be submitted to the office prior to any consideration for Section 8 or other public housing assistance. Each applicant found to be eligible is placed on DHA's waiting list. Any applicants found to be eligible under one of the federally mandated preference categories will be moved to the appropriate position on the waiting list. Section 7 of the City's Memorandum of Understanding with DHA states that "DHA recognizes that some tenants residing in units rehabilitated with rental rehabilitation funds may qualify for preferential treatment under federal guidelines" Those households whose rent burden is 50% or more of household income will be entitled to move forward on the DHA's waiting list along with others who fall into the rent burdened category. V. Equal Housing Opportunity and Non-Discrimination The Community Development Division and the Denton Housing Authority are charged with upholding individual rights under the Federal Fair Housing law. The Community Development Division administers the City's Fair Housing Ordinance. Ordinance No. 81-33 declares "The policy of the City against discrimination in housing:" The City and DHA agree not to discriminate in providing information, counseling, referrals or other relocation services to persons displaced by rental rehabilitation activities. The City and DHA also commit that the practices and methods using and administering this program will not result in this displacement of persons because of their particular race, color, religion, sex, handicap, family status or national origin. For further information, please call the Community Development Division at 940-349-7726. The Community Development Division is located in the Texas Building at 100 W. Oak, Suite 208, Denton, TX 76201. APPENDIX IV PAGE 31 APPENDIX V -TENANT PRE NOTIFICATION SAMPLE LETTER -aj Re: Dear Tenant: tese n yt M4. This letter is to let you know that the rental unit where you live is being considered for rehabilitation through the U.S. Department of Housing and Urban Development Rental Rehabilitation Program under the City of Denton's Rental Rehabilitation Program. PLEASE DO NOT MOVE! This renovation project is being considered in order to provide you with a safer, more comfortable and attractive place to live. If you move without receiving a notice to vacate from the owner, you may not be eligible for relocation assistance. We do not foresee you or any other resident will be displaced by the rehabilitation. However, if for some unforeseen reason displacement should become necessary, relocation assistance will be provided for you. This assistance is described in the attached Tenant Assistance Policy, which contains many important facts regarding the rental assistance available to you. If you need more information or need further explanation, please contact (OWNER) at (TELEPHONE NUMBER), or Alma Espino with the City of Denton at 940-349-7756. Thank you for your cooperation. Please keep in mind this project is simply under consideration at this time so PLEASE DO NOT MAKE ANY PLANS TO MOVE. Should we decide at a later date to proceed with the project, you will be notified. I hereby certify that I have received this notice and a copy of the Tenant Assistance Policy. Signature Date Appendix V Page 32 Appendix VI - Rental Rehabilitation TARGET AREA MAP Appendix A Page 33 Appendix VII -Tenant Beneficiary Information Tracking Form PLACE APPENDIX VII HERE (PAGE 33) Appendix A Page 34