HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 11/18/2003 - ITEMS RELATING TO THE COMPETITIVE PROCESS FOR ALLO ITEM NUMBER: 19 A-F
AGENDA ITEM SUMMARY DATE: November 18, 2003
FORT COLLINS CITY COUNCIL STAFF: Ken Waldo
SUBJECT
Items Relating to the Competitive Process for Allocating City Financial Resources to Affordable
Housing Projects/Programs and Community Development Activities: the Fiscal Year 2003-2004
Home Investment Partnerships (HOME) Program, the Fiscal Year 2003-2004 Community
Development Block Grant (CDBG) Program, and the City's Affordable Housing Fund.
RECOMMENDATION
Staff recommends adoption of the Resolutions and the Ordinances on First Reading. The CDBG
Commission presents a list of recommendations as to which programs and projects should be funded.
The Commission also presents a recommendation for a policy change for allocating CDBG,HOME,
and Affordable Housing Fund loans by adding 5% to the principal repayment amount.
EXECUTIVE SUMMARY
A. Public Hearing and Resolution 2003-127 Approving the FY 2003-2004 Home Investment
Partnerships Program for the City of Fort Collins.
B. Public Hearing and Resolution 2003-128 Adopting Additional Programs/Projects for the FY
2003-2004 Community Development Block Grant Program for the City of Fort Collins.
C. Public Hearing and Resolution 2003-129 Allocating Funding from the City's Affordable
Housing Fund.
D. Public Hearing and Resolution 2003-130 Approving a Policy Change in the Manner Loans
are Made with CDBG, Home, and Affordable Housing Funds by Adding A 5% Fee to the
Principal Repayment Amount.
E. First Reading of Ordinance No. 162, 2003, Appropriating Unanticipated Revenue in the
Home Investment Partnerships Fund.
F. First Reading of Ordinance No. 163, 2003, Appropriating Unanticipated Revenue in the
Community Development Block Grant Fund.
The Home Investment Partnerships (HOME) Program and the Community Development Block
Grant (CDBG) Program provide funds from the Department of Housing and Urban Development
to the City of Fort Collins that can be allocated to community development and affordable housing
related programs and projects, thereby reducing the demand on the City's General Fund Budget to
November 18, 2003 -2- Item No. 19 A-F
address such issues. The City Council is being asked to consider the adoption of four resolutions
and two ordinances. The first resolution (Resolution 2003-127) establishes which programs and
projects will receive funding with HOME funds for the FY 2003-2004 Program year,which started
on October 1, 2003. The second resolution (Resolution 2003-128) establishes which additional
programs and projects will receive funding with CDBG funds for the FY 2003-2004 Program year,
which also started on October 1,2003. The third resolution(Resolution 2003-129)establishes which
programs and projects will receive funding from the City's Affordable Housing Fund. And, the
fourth resolution(Resolution 2003-130)approves a policy change in the manner loans are made with
CDBG,HOME,and Affordable Housing Funds by adding 5%to the Principal Repayment Amount.
The two ordinances (Ordinance No. 162, 2003, and Ordinance No. 163, 2003) appropriate
unanticipated program income revenue for the HOME and CDBG programs respectively.
BACKGROUND
The City Council will conduct a public hearing and consider the adoption of a series of resolutions
establishing which programs and projects will receive funding from the City's HOME Program for
the FY 2003 Program year, which programs and projects will receive funding from available
Community Development Block Grant (CDBG) Program funds, and which programs and projects
will receive funding from the City's Affordable Housing Fund.
The resolutions establishing which programs and projects will receive HOME, CDBG, and City
Affordable Housing Fund dollars represent the culmination of the fall cycle of the competitive
process approved in January 2000 by the Council for the allocation of the City's financial resources
to affordable housing programs/projects and community development activities. Additional
background material about the competitive process is included in Attachment A.
Since early January of this year,the CDBG Commission and members of the City staff's Affordable
Housing Team have conducted public hearings to assess community development and housing needs
in Fort Collins, conducted technical assistance training workshops for applicants, and solicited
applications for funding. The CDBG Commission reviewed written applications, personally
interviewed each applicant, analyzed the applications, and formulated a list of recommendations to
the City Council as to which programs and projects should receive funding.
The competitive process established refined criteria to determine priorities between proposals
received by the City. The ranking criteria are divided into five major categories. Each category is
given a total number of points that has been weighed according to their importance with respect to
local and federal priorities. The five major categories are:
1. Impact/Benefit
2. Need/Priority
3. Feasibility
4. Leveraging Resources
5. Capacity and History
The Impact/Benefit criteria provide greater rewards to proposals that target lower income groups.
The Need/Priority criteria help assure that the proposal meets adopted City goals and priorities. The
November 18, 2003 -3- Item No. 19 A-F
Feasibility crited a reward projects for timelines and documented additional funding. The Leveraging
Resources criteria reward proposals which will return funds to the City (via loans) and for their
ability to leverage other resources. And, the Capacity and History criteria help gage an applicant's
ability to do the project and reward applicants that have completed successful projects in the past
(have good track records). The ranking sheet used to assist the CDBG Commission is presented in
Attachment A.
The Commission also considered the funding guidelines contained in the Priority Affordable
Housing Needs and Strategies report adopted by the Council on February 2, 1999. These guidelines
include:
• HOME funds should generally be allocated as follows: 90% for Housing projects and 10%
for Program Administration. HUD HOME Program regulations also require the City to set
aside 15%for Community Housing Development Organization(CHDO)projects and allow
an allocation of 5% for CHDO operations;
• CDBG funds should generally be allocated as follows: 65% for Housing projects; 10% for
Program Administration; 10% for Public Facilities; and 15% for Public Services;
• funds allocated to housing should generally be divided as follows: 70% for rental projects
and 30% for homeownership opportunities; and
• the average subsidy should be $5,000 per unit, with relatively more funding to projects
producing housing for lower income families.
The CDBG and HOME Programs are ongoing grant administration programs funded by the
Department of Housing and Urban Development (HUD). The City of Fort Collins has received
CDBG Program funds since 1975 and HOME Program funds since 1994. The City is an Entitlement
recipient of CDBG funds and a Participating Jurisdiction recipient of HOME funds, meaning the
City is guaranteed a certain level of funding each year. The level of funding is dependent on the total
amount of funds allocated to the programs by Congress and on a formula developed by HUD,which
includes data on total population, minorities as a percentage of population, income levels, housing
stock conditions,etc. Additional background information on the City's HOME and CDBG Programs
are presented in Attachments C and D respectively.
AVAILABLE FUNDS
The amount of the City's FY 2003 HOME Grant available for projects is $830,039. Added to the
HOME Grant will be$100,000 of estimated HOME Program Income to make a combined amount
of$930,039 available for projects. The HOME funds will be combined with $1,087,924 from the
City's Affordable Housing Fund and $762,081 of unallocated CDBG funds plus $100,000 of
estimated CDBG Program Income to create a potential pool of$2,880,044 of funds available for
programs from the fall cycle of the competitive process.
CDBG funds are typically allocated in the spring and are,thus,not available for use in the fall cycle
of the competitive process. However, the City did not allocate all of its CDBG funds in the spring
cycle of 2003 carrying over an amount of$762,081 for allocation in the fall cycle.
November 18, 2003 -4- Item No. 19 A-F
The following summarizes the amount and sources of available funds:
AMOUNT SOURCE
--------------------------------------------------------------
--------------------------------------------------------------
$ 930,039 FY 2003 HOME Grant and Estimated Program Income
1,087,924 City's Affordable Housing Fund
862,081 Unallocated CDBG Funds and Estimated Program Income
$2,880,044 Total
SELECTION PROCESS
On January 9, 2003, the CDBG Commission held a public hearing to obtain citizen input on
community development and affordable housing needs. The HOME/CDBG Program office placed
legal advertisements in local and regional newspapers starting in July to solicit requests for HOME
and CDBG funded programs and projects and for proposals for the use of funding from the City's
Affordable Housing Fund. The application deadline was Thursday August 21. At the close of the
deadline the City received twelve(12)applications requesting a total of approximately$4.8 million.
Two (2) proposals were withdrawn by the applicants leaving ten (10) applications requesting
approximately$4.2 million in the review/selection process.
Copies of all applications were forwarded through the City Manager's office to the City Council on
September 4, 2003 and placed in the Council Office for review. Also on September 4, 2003 copies
of the applications were distributed to the CDBG Commission and the Affordable Housing Board.
On September 18, 2003 the Affordable Housing Board conducted a special meeting to review the
affordable housing proposals and formulate a list of priority projects which was forwarded to the
CDBG Commission (see Attachment B). On September 25, 2003, the CDBG Commission met to
hear presentations and ask clarification questions from each applicant. The Commission then met
on October 2 for the purpose of preparing a recommendation to the City Council as to which
programs and projects should be funded within funds available from the fall cycle of the competitive
process. At this meeting the Commission reviewed the written applications, the applicant's verbal
presentation, the information provided during the question and answer session, and reviewed the
performance of agencies who received HOME funds, CDBG funds, or other funding in previous
years. The Commission then worked on the formulation of its list of recommendations.
CDBG COMMISSION'S LIST OF RECOMMENDATIONS
HUD HOME regulations limit the amount of available funds that can be allocated to various
categories. Funds for Administrative purposes are limited to 10%of the HOME Grant which means
90%of the Grant must be used for housing projects. Within the 90%required for projects,the City
is required to set aside 15% for Community Housing Development Organization (CHDO)projects
and allow an allocation of 5% for CHDO operations (if any applications are received). Similarly,
HUD CDBG regulations limit the amount of available funds that can be allocated to various
categories. Funds for Administrative purposes are limited to 20%of the CDBG Grant and estimated
Program Income and funds for Public Services are limited to 15%. The City allocated all eligible
November 18, 2003 -5- Item No. 19 A-F
funds for public services during the spring cycle of the competitive process and designated
approximately 11% for administrative purposes.
The Commission, thus, not only had to decide which applicants presented programs and projects
which best fit into the City's HOME and CDBG Programs,but also had to insure funding allocations
were kept within HUD regulations and follow the funding guidelines contained in the Priority
Affordable Housing Needs and Strategies report.
Listed below is a summary of each applicant's initial request for funding and the Commission's list
of recommendations.
1. Administration Proposal
City of Fort Collins—CDBG Program Administration
Request: $53,910 (CDBG Grant)
Recommendation: $53,910 (CDBG Grant)
This is a request to increase the amount of CDBG funds utilized for administration of the CDBG
Program. HUD regulations limit the amount of CDBG funds that can be used for administrative
purposes to no more than 20% of the Grant amount and estimated Program Income. In the spring,
the City allocated$158,392 for CDBG Program administration purposes(approximately 11%of the
maximum allowed). The additional allocation will raise the percentage used for administrative
purposes to approximately 15%.
2. Affordable Housing Projects
City of Fort Collins - Home Buyer Assistance
Request: $1,000,000 Loan ($500,000 HOME, $500,000 CDBG)
Recommendation: $1,000,000 Loan ($570,458 HOME, $429,542 CDBG)
This program is administered by the Advance Planning Department and provides zero-percent
interest loans to eligible first-time homebuyers. The assistance covers down payment and closing
costs at a current loan rate of$9,000 for households at 51% to 80% of Area Median Income (AMI)
and $18,000 for buyers at or below 50% of AMI. The funding would provide a minimum of 111
loans at the current loan rate of$9,000 over the 2003 Fiscal Year.
3. City of Fort Collins - Home Buyer Assistance (Rental Properties)
Request: $200,000 Loan ($200,000 AHF)
Recommendation: $200,000 Loan ($200,000 AHF)
This program is administered by the Advance Planning Department and provides zero-percent
interest loans to eligible first-time homebuyers to purchase former rental properties. The assistance
covers down payment and closing costs at a current loan rate of$9,000 for households at 51%o to
November 18, 2003 -6- Item No. 19 A-F
80% of Area Median Income (AMI) and$18,000 for buyers at or below 50% of AMI. The funding
would provide a minimum of 22 loans at the current loan rate of$9,000 over the 2003 Fiscal Year.
4. Fort Collins Housing Corporation—Rehabilitation and Refinancing of Apartments
Request: $222,565 ($103,565 HOME Grant and $119,000 HOME Loan)
Recommendation: $222,565 ($222,565 CDBG Loan)
The FCHC proposes to rehabilitate and refinance the Myrtle Street Single Room Occupancy(SRO)
building located at 811 East Myrtle Street. The project involves replacing the heating system,roof
and several other Housing Quality Standards items for the building, which is home to 15 at risk of
becoming homeless individuals.
In addition,the application includes refinancing the existing loan to ensure long-term affordability.
If HUD subsidy is lost, the project may not be able to support the current mortgage loan balance
($119,000).
5. Neighbor to Neighbor—Acquisition and Rehabilitation of Apartments
Request: $235,500 ($75,000 HOME Loan and $160,000 CDBG Loan)
Recommendation: $235,500 ($109,581 home CHDO Loan, $125,919 CDBG Loan)
Neighbor to Neighbor requests funds to purchase an 8-plex located at 1041 Ponderosa Street in Fort
Collins. The units in the project will be converted to rents at 30%and 40%of AMI. Some deferred
maintenance will be required to bring the property up to acceptable health and safety standards.
This property adjoins two other Neighbor to Neighbor properties on Clearview and Crabtree Streets.
The arrangement allows for an efficient economy of scale for property management and maintenance
purposes.
6. Paradigm Real Estate Partners LLC—Lakeside Village at Rigden Farm
Request: $600,000($200,000 HOME Loan,$200,000 CDBG Loan and$200,000 AHF
Loan)
Recommendation: No funding
Paradigm Real Estate Partners is requesting funds for the acquisition of land to build 44 single-
family homes targeted to the first-time homebuyers. The Rigden Farm Community is located south
of Drake Road and east of Timberline Road.
All of the units within this first phase will be assisted with public funds and sold to qualified
homebuyers earning no more than 80% of AMI. Home values will be protected and maintained as
affordable as each new homeowner must commit to preserving the affordability of the neighborhood
by agreeing to limit price appreciation on their home to 4% accrued/year or less.
November 18, 2003 -7- Item No. 19 A-F
7. Habitat for Humanity — Multi-Family Partnership for Land Acquisition and
Infrastructure
Request: $695,500 ($695,500 HOME Loan)
Recommendation: $695,500 ($250,000 HOME Loan, $445,500 CDBG Loan)
Habitat for Humanity is requesting funds for the acquisition of land and infrastructure improvements
to develop the Richard Lake PUD. The City has approved this PUD for 54 units of affordable
housing. The project is located north of County Club Road and west of County Road 11.
Habitat for Humanity plans to joint venture with the owner of the development, Scott Price,
Stonebridge Properties LLC. In discussions with the for-profit partner,Habitat would receive 50%
of the units, or 27 units. Habitat would use $250,000 of this request for land acquisition and
$445,500 for infrastructure improvements. Habitat units would be affordable at or below 50% of
AMI and the for-profit partner units would be affordable at 80%and below AMI. This would ensure
a 3-4 year supply of lots for Habitat.
8. Habitat for Humanity—Land Acquisition
Request: $240,000 ($240,000 CDBG Loan)
Recommendation: $ 62,569 ($30,145 CDBG Loan, $32,424 AHF Loan)
Habitat for Humanity is requesting CDBG funds to acquire four new lots ($60,000 per lot). The
organization is actively searching for properties that will meet their needs. Habitat provides
homeownership opportunities for families at or below 50% of AMI.
9. City of Fort Collins Land Bank Program—Interstate Land Site
Request: $410,000 ($410,000 AHF Loan)
Recommendation: $410,000 ($410,000 AHF Loan)
This proposal requests the balance of funds needed to purchase a portion of the Interstate Land
Property neighborhood located on the northwest comer of Prospect Road and I-25 within the city
limits. In the spring, the City designated$400,000 from the Affordable Housing Fund for a portion
of the$810,000 needed for this project. The property is zoned LMN and is currently going through
the City's development review process.
The owners of the Interstate Land development project have approached the City about acquiring 8.3
acres for an affordable housing component in the development. The Interstate Land development
will be a 176-acre mixed-use neighborhood including commercial development, single-family
residential units, townhomes, condominiums and multiple small employment uses.
10. City of Fort Collins—Land Bank General Application
Request: $500,000 (AHF Loan)
Recommendation: No funding
November 18, 2003 -8- Item No. 19 A-F
This application is requesting funds to purchase a site for the City's Land Bank Program. The exact
site has not been identified. The City implemented the Land Bank Program to preserve scarce land
resources for affordable housing projects. Currently, the City has purchased 30 acres (three
properties), which will yield approximately 300-320 future affordable housing units.
Total amount of funding requested = $4,157,475
Total amount of funding available = $2,880,044
Total amount of funding allocated= $2,880,044
The total amount of funding requests considered by the CDBG Commission was approximately$4.2
million, however, only about$2.9 million of funds are available. With the amount of total requests
far exceeding available funding, obviously not all applications could be funded.
The CDBG Commission has recommended full funding for seven(7)proposals,partial funding for
one (1) proposal, and no funding for two (2) projects.
The Commission's reasons for either full funding, or no funding, for all projects are presented in
Attachment E.
• The Commission has recommended allocating all (100%) of the available $862,081 of
CDBG funds.
• The Commission has recommended allocating all (100%)of the$820,458 available HOME
funds.
• The Commission has recommended allocating all(100%)of the$109,581 available from the
HOME-CHDO set-aside.
• The Commission has recommended allocating all (100%)of the$1,087,924 available from
the Affordable Housing Fund.
Proposed Policy Change for CDBG/HOME/AHF Loans
Presently, the City allocates funding from the CDBG and HOME Federal Grant Programs, as well
as funds from the City's Affordable Housing Fund,for non-public service programs as zero-interest,
due on sale, deferred loans. This means recipients of funds make no payments on their loans, but
are required to repay the full loan principal amount if the property is sold at some point in the future.
For example,in the Home Buyer Assistance Program, a family can receive$9,000 in downpayment
assistance to help them purchase a home. The family makes no payments on the loan and only pays
back the loan if they sell their home at some point in the future (or, they refinance, etc.). When the
family does sell, they pay the $9,000 back to the City, whether they sell their home in 1 year or 10
years in the future.
At the CDBG Commission meeting conducted on October 2, 2003, the Commission voted to
recommend to the City Council a policy change in the manner in which the City allocates funding
from the CDBG/HON1E Programs and the City's Affordable Housing Fund by adding a fee to the
City's loans in the amount of 5% of the loan principal, to be paid at the time that the loan is repaid.
The Commission's concerns and rationale were twofold:
November 18, 2003 -9- Item No. 19 A-F
(1) Unknown budget constraints could adversely affect the availability of funds from the
three sources in the future and generating program income now could help ensure
that these programs continue in the light of future adverse financial situations.
(2) Families helped by these loans should have a participatory role in helping the next
family achieve their housing goals. Families receiving these loans certainly should
receive a financial benefit from taxpayer involvement; paying back the loans with a
fee to be used to help other families means the taxpayers' loans are reaping even
more benefits.
The Commission had a subcommittee review and discussed several other options; however, the
Commission believes it to be unrealistic to attempt to recoup"inflation representative"dollars,i.e.,
where the purchasing power of the repaid loans equals the purchasing power of new loans when new
loans are made. While this could be accomplished, and was an important topic of the Commission
subcommittee's discussions, it would essentially require the City to administer extremely
cumbersome adjustable rate mortgages with monthly amortization. The Commission considered
traditional inflation rates, Consumer Price Indices, etc., and determined that 5% of the principal
amount,as a fee due on repayment,was the most efficient avenue to pursue to answer concerns listed
in numbers 1 and 2 above. The end result of this proposal would be that an original $9,000 loan,for
example,would repay$9,450 whenever the property was resold or refinanced. Of course,if the loan
is repaid within the first year, the fee would make the loan fairly expensive. After the first year,the
fee becomes more reasonable when compared to market rate "interest." The fee becomes less
burdensome for those who do not sell their homes early.
RESOLUTION 2003-127
OF THE COUNCIL OF THE CITY OF FORT COLLINS
APPROVING THE FY 2003-2004
HOME INVESTMENT PARTNERSHIPS PROGRAM
FOR THE CITY OF FORT COLLINS
WHEREAS, the purpose of the Home Investment Partnership (HOME) Program is to
increase the supply of decent,safe,and affordable housing in the City of Fort Collins for an extended
period of time; and
WHEREAS, The City's Consolidated Plan identifies the following priorities for housing
related needs: (1)stimulate housing production for very low,low and moderate income households;
(2)increase home ownership opportunities for very low,low and moderate income households; and
(3) increase the supply of public housing for families and those with special needs; and
WHEREAS, specific projects for the use of HOME funds will be determined in November
as a result of the fall funding cycle of the competitive process for the allocation of the City's
financial resources to affordable housing programs/projects and community development activities.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT
COLLINS that City staff is hereby authorized to submit the FY 2003-2004 Home Investment
Partnerships Program application as follows:
$570,458 City of Fort Collins Home Buyer Assistance
$250,000 Habitat for Humanity—Multi-Family
$109,581 Neighbor to Neighbor- Acquisition and Rehabilitation
Passed and adopted at a regular meeting of the Council of the City of Fort Collins held this
18th day of November A.D. 2003.
Mayor
ATTEST:
City Clerk
RESOLUTION 2003-128
OF THE COUNCIL OF THE CITY OF FORT COLLINS
ADOPTING ADDITIONAL PROGRAMS/PROJECTS FOR THE FY 2003-2004
COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM
FOR THE CITY OF FORT COLLINS
WHEREAS, the Community Development Block Grant Program is an ongoing grant
administration program funded by the Department of Housing and Urban Development(HUD);and
WHEREAS, the City of Fort Collins has received CDBG Program funds since 1975; and
WHEREAS,on January 18, 2000,the City Council approved Resolution 2000-13,formally
adopting a competitive process for the allocation of City financial resources to affordable housing
programs/projects and community development activities; and
WHEREAS,since January 2003,the CDBG Commission has held a public hearing to obtain
citizen input on community development and affordable housing needs,and has heard presentations
and asked clarification questions from each applicant that submitted a proposal to the Cityrequesting
funding; and
WHEREAS, the CDBG Commission met in a special meeting for the purpose of preparing
a recommendation to the City Council as to which additional programs and projects should be
funded for the FY 2003-2004 program year.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT
COLLINS that City staff is hereby authorized to submit the FY 2003-2004 Community Development
Block Grant Program application including the additional programs and projects as follows:
$ 53,910 City of Fort Collins - CDBG Administration
$429,542 City of Fort Collins Home Buyer Assistance
$222,565 Fort Collins Housing Corp—Rehabilitation
$125,919 Neighbor to Neighbor- Acquisition and Rehabilitation
$ 30,145 Habitat for Humanity—Land Acquisition
Passed and adopted at a regular meeting of the Council of the City of Fort Collins held this
18th day of November A.D. 2003.
Mayor
ATTEST:
City Clerk
RESOLUTION 2003-129
OF THE COUNCIL OF THE CITY OF FORT COLLINS
ALLOCATING FUNDING FROM THE CITY'S AFFORDABLE HOUSING FUND
WHEREAS, the Council of the City of Fort Collins has identified affordable housing as a
primary need in the community; and
WHEREAS,the Council has established an Affordable Housing Fund consisting of General
Fund revenues from the City's Annual Budget; and
WHEREAS, on January 18,2000,the City Council approved Resolution 2000-13,formally
adopting a competitive process for the allocation of City financial resources to affordable housing
programs/projects and community development activities; and
WHEREAS,specific proposals for the use of Affordable Housing funds have been reviewed
by the City's Affordable Housing Board and Community Development Block Grant Commission
which have forwarded recommendations to the City Council.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT
COLLINS that $1,087,924 from the City's Affordable Housing Fund be allocated as follows:
$ 200,000 City of Fort Collins Home Buyer Assistance
(for previously rented properties)
$ 445,500 Habitat for Humanity—Multi-Family
$ 32,424 Habitat for Humanity—Land Acquisition
$ 410,000 City of Fort Collins —Land Bank Interstate Lands
Passed and adopted at a regular meeting of the Council of the City of Fort Collins held this
18th day of November A.D. 2003.
Mayor
ATTEST:
City Clerk
RESOLUTION 2003-130
OF THE COUNCIL OF THE CITY OF FORT COLLINS
APPROVING A POLICY CHANGE IN THE MANNER LOANS ARE
MADE WITH CDBG, HOME, AND AFFORDABLE HOUSING FUNDS BY
ADDING A 5% FEE TO THE PRINCIPAL REPAYMENT AMOUNT
WHEREAS,presently,the City allocates funding from the CDBG and HOME Federal Grant
Programs, as well as funds from the City's Affordable Housing Fund, for non-public service
programs as zero-interest, due on sale, deferred loans; and
WHEREAS, unknown budget constraints could adversely affect the availability of funds
from the three sources in the future and the early generation of program income could help ensure
that these programs continue in the event of future adverse financial situations; and
WHEREAS,families helped by these loans should be required to participate in helping future
families achieve their housing goals; and
WHEREAS, at the CDBG Commission meeting conducted on October 2, 2003, the
Commission voted to recommend to the City Council a policy change in the manner in which the
City allocates funding from the CDBGIHOME Programs and the City's Affordable Housing Fund
by adding a fee in the amount of five percent (5%) of principal to the City's loans, which fee shall
be repaid at the time of repayment of the loan.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT
COLLINS that City staff is hereby authorized to add a fee in the amount of five percent (5%) of
principal,which fee shall be paid at the time of repayment of the loan,for all loans made with CDBG
and HOME Federal Grant Program funds, as well as loans funded from the City's Affordable
Housing Fund.
Passed and adopted at a regular meeting of the Council of the City of Fort Collins held this
1 Sth day of November A.D. 2003.
Mayor
ATTEST:
City Clerk
ORDINANCE NO. 162, 2003
OF THE COUNCIL OF THE CITY OF FORT COLLINS
APPROPRIATING UNANTICIPATED REVENUE
IN THE HOME INVESTMENT PARTNERSHIPS FUND
WHEREAS, the City will receive unanticipated HOME Program income in the 2003-2004
federal fiscal year in the amount of$100,000; and
WHEREAS, Article V, Section 9, of the Charter of the City of Fort Collins permits the City
Council to make supplemental appropriations by ordinance at any time during the fiscal year,
provided that the total amount of such supplemental appropriations,in combination with all previous
appropriations forthat fiscal year,does not exceed the then current estimate of actual and anticipated
revenues to be received during the fiscal year; and
WHEREAS, City staff has determined that the appropriation of unanticipated HOME
Program income will not result in total appropriations in excess of the current estimate of actual and
anticipated revenues for fiscal year 2003; and
WHEREAS, by adoption of Resolution 2003-127 the City Council approved Programs and
Projects for the 2003-2004 Home Investment Partnerships Program.
NOW,THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT
COLLINS that there is hereby appropriated from unanticipated program income revenue for
approved Home Investment Partnerships projects, upon receipt thereof into the Home Investment
Partnerships Grant Fund,the amount of ONE HUNDRED THOUSAND DOLLARS ($100,000)for
approved Home Investment Partnerships projects.
Introduced, considered favorably on first reading, and ordered published this 18th day of
November,A.D. 2003,and to be presented for final passage on the 2nd day of December,A.D.2003.
Mayor
ATTEST:
City Clerk
Passed and adopted on final reading this 2nd day of December, A.D. 2003.
Mayor
ATTEST:
City Clerk
ORDINANCE NO. 163, 2003
OF THE COUNCIL OF THE CITY OF FORT COLLINS
APPROPRIATING UNANTICIPATED REVENUE
IN THE COMMUNITY DEVELOPMENT BLOCK GRANT FUND
WHEREAS, the City will receive unanticipated Community Development Block Grant (CDBG)
Program income in the 2003-2004 federal fiscal year in the amount of$100,000; and
WHEREAS, Article V, Section 9, of the Charter of the City of Fort Collins permits the City
Council to make supplemental appropriations by ordinance at anytime during the fiscal year,provided that
the total amount of such supplemental appropriations,in combination with all previous appropriations for
that fiscal year,does not exceed the then current estimate of actual and anticipated revenues to be received
during the fiscal year; and
WHEREAS, City staff has determined that the appropriation of unanticipated CDBG Program
income will not result in total appropriations in excess of the current estimate of actual and anticipated
revenues for fiscal year 2003; and
WHEREAS, by adoption of Resolution 2003-128 the City Council approved Additional
Programs/Projects for the 2003-2004 Community Development Block Grant Program.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT
COLLINS that there is hereby appropriated from unanticipated program income revenue for approved
Community Block Grant projects, upon receipt thereof into the Community Development Block Grant
Fund, the amount of ONE HUNDRED THOUSAND DOLLARS ($100,000) for approved Community
Development Block Grant projects.
Introduced, considered favorably on first reading, and ordered published this 18th day of
November, A.D. 2003, and to be presented for final passage on the 2nd day of December, A.D. 2003.
Mayor
ATTEST:
City Clerk
Passed and adopted on final reading this 2nd day of December, A.D. 2003.
Mayor
ATTEST:
City Clerk
Attachment A
Background Information on the Competitive Process
for the Allocation of City Financial Resources
to Affordable Housing Programs/Projects
and Other Community Development Activities
In February of 1999, the City Council approved the Priority Affordable Housing Needs and
Strategies report, which contained the following strategy:
Change from an administrative funding mechanism...to a competitive application process
for the Affordable Housing Fund.
Between September and November of 1999, a subcommittee consisting of members from the
Affordable Housing Board and the Community Development Block Grant (CDBG) Commission
met with staff to review issues and develop options for establishment of a competitive process.
In addition, the staff solicited ideas from existing affordable housing providers. The
subcommittee established the following Mission Statement for their work:
Develop a competitive application process and establish a set of shared criteria for the
allocation of the City's financial assistance resources to affordable housing
projects/programs that address the City's priority affordable housing needs.
Competitive Process
Five options for a competitive process were reviewed and discussed by the subcommittee. The
subcommittee reached a general consensus to support a competitive process that involved both
the Affordable Housing Board and the CDBG Commission. The option selected would have the
Affordable Housing Board providing recommendations to the City Council in regards to
affordable housing policy. In addition, the option would have the Affordable Housing Board
reviewing all affordable housing applications for CDBG, HOME and Affordable Housing funds.
The Board would then provide a priority listing of proposals to the CDBG Commission. The
CDBG Commission would then make the final recommendations to the City Council for funding.
Funding Cycles
The subcommittee also agreed that there should be two funding cycles per year, one in the spring
and the other in the fall. CDBG Program funds would be allocated in the spring to affordable
housing programs/projects and other community development activities (public services, public
facilities, etc.). HOME Program and Affordable Housing funds would be allocated in the fall
primarily to affordable housing programs/projects.
The staff and subcommittee agreed that overlaying the new process and cycles would be
heightened staff technical assistance to applicants. Both the subcommittee and staff recognize
that a bi-annual process will require additional meetings by both the CDBG Commission and
Affordable Housing Board, and will require more time from current City staff, and increase the
City Council's involvement.
Schedule
The subcommittee also discussed two alternative schedules for the funding cycles. The option
selected incorporates a spring cycle that starts in January and ends in May, and a fall cycle that
starts in July and end in November.
Review Criteria
The subcommittee also discussed and agreed to a new set of review criteria to be used to rank
proposals. The criteria are divided into the following five major categories:
1. ImpactBenefit
2. Need/Priority
3. Feasibility
4. Leveraging Resources
5. Capacity and History
The Impact/Benefit criteria provide greater rewards to proposals that target lower income groups
and provide longer benefits. The Need/Priority criteria help assure the proposal meets adopted
City goals and priorities. The Feasibility criteria reward projects for timeliness and documented
additional funding. The Leveraging Resources criteria reward proposals which will return funds
to the City(loans) and for their ability to leverage other resources. And, the Capacity and History
criteria help gage an applicant's ability to do the project and reward applicants that have
completed successful projects in the past (have good track records).
See next page for a detailed criteria scoring sheet.
Application Forms
Two new application forms have also been developed. One form would be used for Housing
proposals while to other form would be used for Non-Housing Proposals (public services, public
facilities, etc.).
City Council Adoption
On January 18, 2000, the City Council approved Resolution 2000-13, formally adopting the
competitive process for the allocation of City financial resources to affordable housing
programs/projects and community development activities and the component parts discussed
above.
Ranking Criteria for CDBG, HOME and Affordable Housing Funding
The ranking criterion is divided into five major categories.Each category is given a total number of points that has been weighed
according to their importance with respect to local and federal priorities.This ranking sheet will be used to assist the Community
Development Block Grant Commission(CDBGC)and the Affordable Housing Board(AHB)in the FY01 Competitive Funding
Process.CDBG and AHB members will rank projects according to the questions and criteria shown below.
impact/Benefit(maximum 30 points)
I. Primarily targets low income persons? (0-10)
(0-30%of AMI= 10 pts,31-50%=8 pts,51-80%=4 pis)
2. Project produces adequate community benefit related to cost? (0-5)
3. Does the project provide direct assistance for persons to gain self-sufficiency? (0-5)
4. Does the project provide long-term benefit or affordability? (0-10)
(1-10 yrs=3 pts, 11-19 yrs=6 pts,20 to 30 yrs=8 pts,and Permanent= 10 pis)
Sub-total
Need/Priority(maximum 15 points)
I. Meets a Consolidated Plan priority? (0-5)
2. Project meets goals or objectives of City Plan and Priority Needs and Strategies study (0-5)
3. Has the applicant documented a need for this project? (0-5)
Sub-total
Feasibility(maximum 15 points)
I. The project will be completed within the required time period? (0-3)
2. Project budget isjustified?(Costs are documented and reasonable)? (0-4)
3. The level of public subsidy is needed?(Private funds not available)? (0-4)
4. Has the applicant documented efforts to secure other funding? (0-4)
Sub-total
Leveraeine Resources(maximum 25 points)
I. Does the project allow the reuse of our funding? (0-8)
A. Principal and interest(30 year Amortization or less) 8 point
B. Principal and no interest or Principal and balloon payment 4 point
C. Declining balance lien(amount forgiven over time) I point
D. Grant(no repayment) 0 point
2. Project or agency leverages human resources(Volunteers) (0-7)
3. Project leverages financial resources?(Including in-kind) (0-10)
A. Less than I:1 0 point
B. 1:1 to 1:3 4 point
C. 1:4 to 1:6 7 point
D. More than 1:7 10 poll
Sub-total
Capacity and History(maximum 15 points)
1. Applicant has the capacity to undertake the proposed project? (0-10)
2. If previously funded,has the applicant completed prior project and maintain regulatory compliance? (0-5)
3. If new,applicant has capacity to maintain regulatory compliance? (0-15)
Sub-total
GRAND TOTAL
Attachment B
Fall 2003 Competitive Process
The Affordable Housing Board's priority listing of the affordable housing
applications is as follows:
1. HO-1, Homebuyer Assistance Programs
2. HO-7, Habitat for Humanity— Multi-Family Partnership
3. (tie) HO-8, Habitat for Humanity— Land Acquisition, and
LB-1, Land Bank Program Interstate Land Site
4. HO-3, Ft. Collins Housing Authority — Myrtle Street SRO
Rehabilitation
Comments/Concerns: Funding should be a Deferred Loan and not
a Declining Balance Loan. If Mortgage if paid-off, future
"payments' should go into a reserve account for maintenance
purposes.
5. HO-4, Neighbor-to-Neighbor— Acquisition/Rehabilitation of an 8-
plex
Comments/Concerns: Why is there a $20,000 Developers Fee for
acquisition of an existing structure?
6. LB-2, Land Bank Program General Application
7. HO-6, Paradigm Real Estate Partners Lakeside/Rigden Farm
Comments/Concerns: Funding should be a Deferred Loan and not
a Declining Balance Loan. Project seems premature, no Market
Study to verify potential buyers. Applicant should resubmit in a
future competitive process cycle when the proposal could be
further developed.
The Board believes the all proposals were good applications all should
receive some funding, if possible, given the limitations of the funding
sources.
Attachment C
ADDITIONAL BACKGROUND INFORMATION
on the
HOME INVESTMENT PARTNERSHIP PROGRAM
HOME INVESTMENT PARTNERSHIP PROGRAM GUIDELINES
(Adopted by the Fort Collins City Council, July 18, 1995)
PURPOSE:
The purpose of the Home Investment Partnership (HOME) Program is to increase the supply of
decent, safe, and affordable housing in the City of Fort Collins for an extended period of time.
All of the HOME funds must benefit low and very low income households which are defined by
the Department of Housing and Urban Development as having a total household income not
exceeding 80%of the median household income for the Fort Collins area.
ELIGIBLE PROJECTS:
HOME funds must be used in the following ways:
1. To help low-income individuals to purchase housing for their principal residence.
Applicants must meet income guidelines of no more than 80% of the median household
income for the Fort Collins area and will be required to attend a homebuyer workshop.
Assistance is in the form of zero percent deferred loan up to a maximum of$5,000 to
help cover downpayment and closing cost expenses. The funding is repaid when the
property is sold or transferred out of the buyer's name. See Eligible Property Types
section below for a list of property types eligible for HOME assistance and purchase
price restrictions. Restrictions will apply which will assure the property remains
affordable. This is accomplished by the "recapturing" of the HOME investment.
Income Limits: 1 person $36,300
2 persons $41,450
3 persons $46,650
4 persons $51,850
5 persons $56,000
6 persons $60,150
7 persons $64,300
8 persons $68,450
2. For new construction of units for homeownership as well as rental occupancy targeted for
low-income individuals and families which are developed, sponsored, or owned by
1
community housing development organizations (CHDOs), non-profit agencies, and for-
profit developers.
3. For acquisition of undeveloped, or developed, land resulting in the development or
purchase of units for homeownership as well as rental occupancy. All regulations
regarding income guidelines, purchase price limitations, resale limitations, rental rates,
etc., will apply to acquisition projects.
ELIGIBLE PROPERTY TYPES:
Eligible property types for purchase include both existing property or newly constructed homes.
Eligible property includes a single-family property, a condominium unit, a manufactured home
(including mobile homes on a permanent foundation), or a cooperative unit. For purposes of the
HOME program, homeownership means:
(1) ownership in fee simple title, or
(2) a 99 year leasehold interest, or
(3) ownership or membership in a cooperative, or
(4) an equivalent form of ownership which has been approved by the Department of
Housing and Urban Development.
The value and purchase price of the HOME assisted property to be acquired must not exceed
95%of the area median purchase price for that type of housing as established by HUD.
RECAPTURE RESTRICTIONS WILL APPLY. (The value must be verified by a qualified
appraiser or current tax assessment.) Initial purchase price limit established by HUD is currently
$201,000.
PROGRAM ACTIVITY BY YEAR
Home Buyer HOME
Year Administration Assistance Projects Total
1994-95 50,000 50,000 400,000 500,000
1995-96 45,500 165,700 243,800 455,000
1996-97 53,900 269,500 215,600 539,000
1997-98 53,300 319,800 159,900 533,000
1998-99 56,900 319,750 192,350 569,000
1999-00 61,500 253,309 342,250 657,059
2000-01 70,000 75,000 630,000 775,000
2001-02 78,300 251,000 433,500 762,800
2002-03 68,400 723,174 166,677 958,251
2
HOME PROGRAM PRIORITIES
The 2000-2004 Consolidated Plan identifies the following priorities for housing related needs:
1. Stimulate housing production for very low, low and moderate income rental
households.
2. Increase home ownership opportunities for very low, low and moderate income
households.
3. Increase the supply of public housing for families and those with special needs.
Implementation and funding of activities to address these priorities will come, in part, from the
City of Fort Collins HOME Investment Partnership Program.
3
ATTACHMENT D
ADDITIONAL BACKGROUND INFORMATION
on the
COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM
CDBG PROGRAM NATIONAL OBJECTIVES
The primary objective of the CDBG Program is Athe development of viable urban communities,by
providing decent housing and a suitable living environment and expanding economic opportunities,
principally for persons of low and moderate income.- Programs and projects funded with CDBG
funds must address at least one of the following three broad National Objectives:
(1) provide a benefit to low or moderate income households or persons,
(2) eliminate or prevent slum and blight conditions, or
(3) meet urgent community development needs which pose an immediate and serious
threat to the health and welfare of the community.
Presented below is a comparison of City CDBG expenditures for programs and projects categorized
according to the National Objectives:
National Objectives
Low/Moderate Slum/Blight Urgent
Income Benefit Elimination Need
_-----------------------------------
National Average 90% 10% 0%
City Expenditures
for:
2002 100% 0% 0%
2001 100% 0% 0%
2000 100% 0% 0%
1999 100% 0% 0%
1998 100% 0% 0%
1997 100% 0% 0%
1996 100% 0% 0%
1995 100% 0% 0%
1994 90% 10% 0%
1993 100% 0% 0%
1992 100% 0% 0%
CDBG PROGRAM ELIGIBLE ACTIVITIES
CDBG funds can be used on a wide range of activities including:
(1) acquiring deteriorated and/or inappropriately developed real property (including
property for the purpose of building new housing);
(2) acquiring, constructing, rehabilitating or installing publicly owned facilities and
improvements;
(3) restoration of historic sites;
(4) beautification of urban land;
(5) conservation of open spaces and preservation of natural resources and scenic areas;
(6) housing rehabilitation can be funded if it benefits low and moderate income people;
and
(7) economic development activities are eligible expenditures if they stimulate private
investment of community revitalization and expand economic opportunities for low
and moderate income people and the handicapped.
Certain activities are ineligible, under most circumstances, for CDBG funds including:
(1) purchase of equipment,
(2) operating and maintenance expenses including repair expenses and salaries,
(3) general government expenses,
(4) political and religious activities, and
(5) new housing construction.
Presented below is a comparison of CDBG expenditures by activity category:
National City Expenditures for:
Activity Average 2002 2001 2000 1999 1998 1997 1996 1995
Housing 43% 73% 72% 64% 73% 73% 63% 61% 74%
Public Facilities 21% 11% 2% 5% 2% 2% 13% 15% 7%
Planning/Admin. (20%) 14% 7% 11% 17% 10% 10% 9% 9% 5%
Economic Development 13% 0% 0% 0% 0% 0% 0% 0% 0%
Public Services (15%) 9% 9% 15% 14% 15% 15% 15% 15% 14%
The Planning and Administration category can include funds allocated for planning related
projects as well as program administration. In the past, planning projects have included funds for
the East and West Side Neighborhood Plans and the Downtown Plan. The 2000 figure includes
funds for the BAVA Neighborhood Plan. The 2001 Administrative percentage was 12%.
Attachment E
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6:00 p.m. - 7:30 p:m-
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Commission members present:
Phil Majerus, Chair
Terri Bryant, Vice Chair
Robert Browning
Linda Coxen
Bruce Croissant
Michael Kulischeck
Billie Rosen
Shelley Steele
Dennis Vanderheiden
Cheryl Zimlich
Staff:
Ken Waido
Heidi Phelps
Maurice Head
Julie Smith
Melissa Visnic
Produced by Meadors Court Reporting, LLC
171 North College Avenue
Fort Collins, Colorado 80524
970.482.1506
1
1
MEETING HIGHLIGHTS
Mr. Waido displayed the electronic spreadsheet and reviewed voting and tallying
procedures.
Ms. Phelps urged the Commission to speak in turn, particularly during motions,
identifying themselves for motions and seconding. She asked for clarity concerning
explanations of pros and cons as the basis for any motions.
Funding Source Adiustments Motion
Following motions on funding, Mr. Waido recommended the following adjustments be
made in order to fit within the available funding and applicable requirements: The
HOME $450,000 portion of the HO-1 recommendation to be adjusted to $470,458; the
CDBB $350,000 portion of the HO-1 allocation to be adjusted to $329,542; the $20,458
HOME portion of the HO-8 allocation to be removed; the $9,687 CDBG portion of the
HO-8 allocation to be adjusted upward to $30,145.
Moved by Ms. Zimlich, seconded by Mr. Kulischeck: To accept the
recommendation of funding adjustments. Motion passed unanimously.
Moved by Ms. Zimlich, seconded by Mr. Browning: To accept the funding
recommendations in toto. Motion passed 8-1. [See also Funding Matrix.]
Mr. Waido reviewed the next steps in the process. There will be a discussion with City
Council in a work session on October 28, 2003. The discussion will encompass the
recommendations made in this session as well as the proposed policy change voted on
last week concerning the recommendation of the 5% finance charge on any loans made
from our funding sources.
Staff is checking with lenders and legal staff as to the designation of this charge.
Currently, it appears that it will be disclosed as a finance charge due to truth in lending
requirements. Council may show curiosity as to the reasons for 5%. It was noted that
the figure was generally based on a historical CPI/inflation rate of 4%. Council may then
be curious as to why the proposal exceeds that rate. Staff is receiving more input from
the Finance Department.
Designated speakers:
Policy change: Mr. Vanderheiden and Mr. Browning
AD-1: Mr. Vanderheiden
HO-1 (both): Ms. Molander
HO-3: Ms. Bryant
HO-4: Ms. Rosen
HO-6: Ms. Rosen
HO-7: Mr. Kulischeck
HO-8: Mr. Kulischeck
2
LB-1: Mr. Vanderheiden
LB-2: Mr. Vanderheiden
Mr. Majerus noted that he may be absent for the Council meeting on November 18. Ms.
Bryant will be absent as well. Mr. Browning will represent the Commission if both the
Chair and Vice Chair are absent.
3
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FALL 2003 COMPETITIVE PROCESS FUNDING CYCLE
AD-1, CDBG Administration - $53,910
Moved by Ms. Rosen, seconded by Ms. Bryant: To recommend full funding;
source, CDBG funds. Motion approved unanimously.
Total recommended funding level - $53.910
7Expenses
s of Application Cons of Application
nerated by the CDBG Takes funding from projects.
ld be met by the programle. The funding is less thann the program requirements.ge of funding is less than
other comparable Colorado communities.
HO-1 — Home Buyer Assistance - $200,000
HO-1 — Home Buyer Assistance (Rentals) - $1,000,000
Moved by Mr. Brown, seconded by Ms. Rosen: To recommend funding of
$1,200,000 for both HO-1 categories, apportioned as follows: CDBG (PI), $100,000;
HOME (PI), $100,000; CDBG, $350,000; HOME, $450,000. Motion approved
unanimously. [See also Funding Source Adjustments Motion and Funding
Matrix.]
Total recommended funding level - $1,200,000
rvaluemfor
os of Application Cons of Application
ssful program. Provides the
or the dollar of any other
icularly in light of the funding
e funds are fully used year
nstratin the need.
5
HO-3 — Fort Collins Housing Authority SRO - $222,565
Moved by Ms. Molander, seconded by Mr. Croissant: To recommend full funding;
source, CDBG funds. Motion passed unanimously.
Total recommended funding level - $222,565
Pros of Application Cons of Application
Serves a critical, special needs population Could have future windfall depending on
with permanent, supportive housing. outcome of Section 8 program.
Maintenance reserves and funding present
a problem at this level of AMI population.
With the necessary deep subsidy, the
program will have a higher level of
operating comfort. FCHA already cross-
subsidizes operation of this unique
property. Program should not be placed in
a position of selling other highly needed
properties. This presents an opportunity to
address maintenance needs and protect
Cit 's investment over time.
HO-4, Neighbor to Neighbor eight-plex - $235,500
Moved by Ms. Rosen, seconded by Ms. Bryant: To recommend full funding;
source, CHDO, $109,581; CDBG, $125,919. Motion passed unanimously.
Total recommended funding level - $235,500
Pros of Application Cons of Application
Good track record. The location provides
for a benefit in consolidating service and
management economies. This acquisition
is a good match for the entire project. This
presents an improvement for the
neighborhood. The project enjoys
neighborhood support. This program
serves a low 30-40% AM level.
6
HO-6, Rigden Farm - $600,000
Moved by Ms. Coxen, seconded by Ms. Steele: To recommend full funding; half of
funds allocated from HOME, half from CDBG. Motion failed 0-9, with one
abstention.
Moved by Mr. Kulischeck, seconded by Ms. Rosen: To recommend no funding.
Motion passed 8-0, with two abstentions.
Total recommended funding level - $0
Pros of Application Cons of Application
Program involves a for-profit developer. Price points of product very high for
Provides for a desirable mix of market and subsidy requested, when compared with
affordable housing. other higher priority needs and in light of
limited, available funding. High AMI
targeted. The cap on equity could be
disadvantageous to the home owner.
Other programs have higher priority. No
long-term statistics on success. A market
already exists for $200,000 homes without
need of subsidy and equity cap. Other
similar projects are not true com arables.
7
HO-7, Habitat Multi-family project - $695,500
Passed Motion: Moved by Mr. Browning, seconded by Mr. Kulischeck: To
recommend funding of$695,500 from HOME funds, with the stipulation that an
explanation of the partnership structure be provided prior to funding and
approved by City staff. Amended, with consent of the second: To apportion
funding of$250,000 from HOME, $445,500 from the Affordable Housing Fund.
Following discussion, the motion was tabled. When untabled, it was discussed that
$250,000 of HOME funding could be used for raw land and be subject to Federal
requirements; the remaining, $445,500, could come from the City's Affordable Housing
Fund, without those requirements. Staff assured the Commission that no funding could
be used for any inappropriate purpose.
Motion passed 7-2, with one abstention.
Failed Motion: Moved by Mr. Majerus, seconded by Ms. Molander: To reallocate
$145,000 from the Affordable Housing fund dollars from HO-7, to be divided
between HO-8 ($45,000) and LB-2 ($100,000). Motion failed 2-8.
Total recommended funding level - $695,500
Pros of Application Cons of Application
The affordable housing continuum needs No other financial leverage yet explored.
stick-built homes. This involves a for-profit Fees are high. The location lacks services
developer. Good mix with market units. that affordable units may need. This
This project may serve as an example for subsidy may serve to aid the for-profit
other for-profit development. Good track developer for the entire development.
record of applicant, but this partnership
structure has not been seen before locally.
Exciting approach. The lack of transit
services is offset by the fact that
historically, all Habitat families have owned
a car.
8
HO-8, Habitat, acquisition - $240,000
Withdrawn Motion: Moved by Ms. Rosen, seconded by Ms. Bryant: To
recommend funding of $62,569 for one lot. After discussion, motion withdrawn
with consent of the second.
Passed Motion: Moved by Mr. Kulischeck, seconded by Ms. Bryant: To
recommend funding of $62,569; sources: HOME $20,458, CDBG $9,687, and AHF
$32,424. At this stage of the discussion, the remaining desirable targets for remaining
funds were HO-8 and LB-2. Motion passed 6-3. [See also Funding Source
Adjustment Motion & Funding Matrix.]
Failed Motion: Moved by Mr. Majerus, seconded by Ms. Molander: To reallocate
$145,000 from the Affordable Housing fund dollars from HO-7, to be divided
between HO-8 ($45,000) and LB-2 ($100,000). Motion failed 2-8.
Total recommended funding level - $62,569
Pros of Application Cons of Application
An immediate need exists for this funding Program may have its hands and focus
due to the number of families applying. fully occupied with the multifamily housing
Good track record of the program. project. High subsidy for one housing unit.
Immediate needs override the future goals The cost to benefit ratio is higher with the
of land banking in competition for funding. multifamily development.
A variety of inventory is desirable for the
Habitat program. Larger or special needs
families are sometimes served. Very little
land remains within the city that will be
available for affordable housing.
LB-1, Land Bank, Interstate Land - $410,000
Moved by Mr. Browning, seconded by Ms. Rosen: To recommend funding of
$410,000. Motion passed 8-1.
Total recommended funding level - $410,000
Pros of Application Cons of Application
The program is committed to the first half The program goal is long-term, and does
of the project and should complete its not serve immediate need.
commitment. This has the potential to be a
good project. The land bank concept
appears sound, and this is an appropriate
use.
9
LB-2, Land Bank, General Application - $500,000
Passed Motion: Moved by Ms. Rosen, seconded by Mr. Vanderheiden: To
recommend no funding. Motion passed 8-1, with one abstention.
Failed Motions: Moved by Ms. Rosen: To recommend funding of $62,569. Motion
died for lack of a second.
Moved by Mr. Majerus, seconded by Ms. Molander: To reallocate $145,000 from
the Affordable Housing fund dollars from HO-7, to be divided between HO-8
($45,000) and LB-2 ($100,000). Motion failed 2-8.
Total recommended funding level - $0
Pros of Application Cons of Application
Land banking seems to be a sound Paucity of funding. Loses priority in light of
concept, and this project may be other more worthy, specific, and
appropriate for the next funding cycle. immediate projects.
10