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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 11/20/2012 - ITEMS RELATING TO THE 2012 FALL CYCLE OF THE COMPEDATE: November 20, 2012 STAFF: Sharon Thomas Heidi Phelps AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 19 SUBJECT Items Relating to the 2012 Fall Cycle of the Competitive Process for Allocating City Financial Resources to Affordable Housing and Community Development Activities Utilizing Funds from the Federal Community Development Block Grant and HOME Investment Partnership Programs, and the City’s Affordable Housing Fund. A. Public Hearing and Resolution 2012-105 Approving the Programs and Projects that Will Receive Funds from the Federal Community Development Block Grant and HOME Investment Partnership Programs, and the City’s Affordable Housing Fund. B. First Reading of Ordinance No. 131, 2012, Authorizing the Transfer of Appropriations Between Program Years in the Community Development Block Grant Fund. EXECUTIVE SUMMARY This Resolution will complete the 2012 fall cycle of the Competitive Process for allocating $1,670,130 in City financial resources to affordable housing projects and public facility activities. Ordinance No. 131, 2012, reappropriates Community Development Block Grant (CDBG) funds that have been returned to the program for allocation in the fall 2012 Competitive Process. BACKGROUND / DISCUSSION Resolution 2012-105 establishes which programs and projects will receive funding with Community Development Block Grant (CDBG), HOME Investment Partnership (HOME) and Affordable Housing Fund (AHF) dollars for the FY 2012 program year which began on October 1, 2012. A combined total of $1,670,130 was available for funding in the fall cycle. The CDBG Commission presents to the City Council a list of recommendations as to which programs and projects should receive funding. The following table summarizes the total amount and sources of available CDBG, HOME and AHF funds for distribution during the 2012 fall cycle of the Competitive Process: Available Funding AMOUNT SOURCE $750,000 FY 2010 and 2011 CDBG Reprogrammed funds $407,570 FY 2012 HOME Participating Jurisdiction Grant $198,020 FY 2012 HOME Program Income $81,497 FY 2012 HOME CHDO Set-aside $89,888 FY 2011 HOME CHDO Set-aside $143,155 FY 2012 Affordable Housing Fund $1,670,130 Total Funding Available During the spring 2011 cycle of the Competitive Process, Merten, Inc. was awarded $750,000 of CDBG funds for the affordable housing senior project, Union Place. In July 2012, the funds were returned to the City because the developer was unable to continue with the project. Ordinance No.131, 2012 reappropriates those CDBG funds to be reprogrammed into the 2012 fall cycle of the Competitive Process. Community Housing Development Organization (CHDO) funds are HOME grant funds required to be specifically earmarked for use by CHDOs in the city. City CHDO agencies include CARE Housing, Neighbor-to-Neighbor, and Villages (formerly the Fort Collins Housing Corporation). Villages was the only CHDO agency requesting funding in the 2012 fall cycle. November 20, 2012 -2- ITEM 19 FINANCIAL / ECONOMIC IMPACTS The Community Development Block Grant (CDBG) Program, and the Home Investment Partnership (HOME) Program provide federal funds from the Department of Housing and Urban Development (HUD) to the City of Fort Collins which can be allocated to housing and community development related programs and projects, thereby, reducing the demand on the City’s General Fund Budget to address such needs. The total amount of CDBG funds available for allocation for the fall cycle of the Competitive Process is $750,000 and $776,975 from HOME funds. The City’s General Fund contributes $325,047 of Affordable Housing Fund dollars for the fall cycle of the competitive process. Of those funds, $131,892 were allocated to the Fort Collins Housing Authority’s Supportive Housing project following the spring cycle and $50,000 was allocated to developing the Redevelopment Displacement Mitigation Plan, leaving $143,155 to fund projects/programs in the fall 2012 cycle of the Competitive Process. Through the provision of affordable housing, more of Fort Collins’ work force can reside within the community. This means there is an available labor pool within the city, which is a positive benefit to economic sustainability. Public/human services programs contribute to economic sustainability by providing such programs as job training and child care so workers can maintain their employment and housing situations. By providing funding for needed upgrades to their facilities or for partial purchase of service locations, the agencies are better able to utilize funds to serve their clients. ENVIRONMENTAL IMPACTS Affordable housing programs help provide for a healthy environment. By offering affordable housing options for lower income people, more of Fort Collins’ work force can live in the community instead of being forced to live outside the community and commute into the city for work. This helps reduce traffic congestion and, thus, improves air quality. Affordable housing developers, including for-profit and non-profit agencies, are utilizing green building practices. Green building practices are being used in both new construction and major rehabilitation of existing housing unit projects. These practices include geothermal applications and other energy saving techniques. All affordable housing projects utilizing CDBG and HOME funds are required to pass a HUD Environmental Review which covers such items as noise impacts, floodplains, hazardous materials, etc. STAFF RECOMMENDATION Staff recommends adoption of the Resolution and the Ordinance on First Reading. BOARD / COMMISSION RECOMMENDATION Community Development Block Grant (CDBG) Commission Recommendations The CDBG Commission presents recommendations as to which programs and projects should receive funding from the available funding sources presented above, including CDBG, HOME and AHF funds. The following tables present the allocations recommended by the Commission to the City Council within each major category: Economic Development Category Applicant Project/Program Funding Request Commission’s Recommendation Unfunded Balance Percent of Request Funded ED-1 Fort Collins Local Development Company: Revolving Loan Fund for Start- up Companies $300,000 $0 $300,000 0% November 20, 2012 -3- ITEM 19 Affordable Housing Category Applicant Project/Program Funding Request Commission’s Recommendation Unfunded Balance Percent of Request Funded HO-1 City of Fort Collins: Homebuyer Assistance Program – Affordable Housing Funds $50,000 $50,000 AHF $0 100% HO-2 City of Fort Collins: Homebuyer Assistance Program – HOME Funds $50,000 $50,000 HOME $0 100% HO-3 Fort Collins Housing Authority: Tenant Based Rental Assistance (TBRA) for CDDT $156,240 (Grant) $156,240 HOME (Grant) $0 100% HO-4 Fort Collins Housing Authority: TBRA Administrative Costs $17,434 (Grant) $17,434 AHF (Grant) $0 100% HO-5 Housing Authority of the City of Loveland: Larimer Home Improvement Program $75,000 (Grant) $67,721 AHF (Grant) $7,279 90% HO-6 Villages Ltd.: Property Acquisition $1,072,811 $1,072,811 CDBG/HOME 0% 100% All funding recommendations in the Affordable Housing category are in the form of a “Due on Sale Loan + 5% Simple Interest” unless noted as a grant. November 20, 2012 -4- ITEM 19 PUBLIC OUTREACH HUD regulations require a 30-day public comment period on the proposed allocation of CDBG and HOME funds as recommended by the CDBG Commission. Staff placed an ad in the Coloradoan presenting the list of recommended funding for programs/projects and indicated the public comment period would start on October 15, 2012, and end on November 13, 2012. To date, no public comments have been received. ATTACHMENTS 1. Background and Summary of the CDBG Commission’s Recommendations for Funding 2. Background Information on the Competitive Process 3. Affordable Housing Board’s Comments, Meeting Minutes September 20, 2012 4. Background Information on the CDBG and HOME Federal Programs 5. CDBG Commission’s Funding Recommendations, Meeting Minutes October 11, 2012 1 ATTACHMENT 1 Background And Summary of CDBG Commission’s Recommendations for Funding At the November 20, 2012, regular City Council meeting, the Council will be conducting a public hearing and consider the adoption of a resolution establishing which programs and projects will receive funding from the Community Development Block Grant (CDBG) Program, Federal Home Investment Partnership (HOME) Program and the City’s Affordable Housing Fund for the FY 2012 Program year. The resolution establishing which programs and projects will receive funds represents the culmination of the fall cycle of the 2012 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 2. Since early January of this year, the CDBG Commission and members of the City staff’s Affordable Housing and Grants Administration Work Group 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 City’s Affordable Housing Board reviewed the written applications for affordable housing projects and forwarded a priority ranking of proposals, as well as comments and questions, to the CDBG Commission. See Attachment 3 for a copy of the Board’s materials sent to the CDBG Commission. The CDBG Commission, in addition to reviewing the 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 CDBG and HOME Programs are ongoing grant administration programs funded by the U.S. 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 Community 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 is presented in Attachment 4. The City’s Affordable Housing Fund (AHF) was established in 2000 to supplement federal funding from the CDBG and HOME Programs. One purpose of the AHF was to have a source of funding free of federal rules and regulations. 2 SELECTION PROCESS The selection process for the City's FY 2012 Competitive Process began in January when the CDBG Commission held a public hearing to obtain citizen input on community development and affordable housing needs. The City’s Social Sustainability Department placed legal advertisements in local newspapers starting in July to solicit requests for housing, community development and public facility projects for FY 2012. In addition emails were sent to potential applicants. The application deadline was Thursday August 16, 2012. At the close of the deadline the City received ten (10) applications requesting a total of $2,102,685. Copies of the housing applications were distributed to the Affordable Housing Board and all applications were made available to the CDBG Commission in early September. On Thursday September 20, 2012, the Affordable Housing Board conducted a special meeting to review the housing proposals and prepared a priority listing of applications to the CDBG Commission (see Attachment 3). On Thursday, September 27, the Commission met to hear presentations and ask clarification questions from each applicant. The Commission then met on Thursday, October 11 for the purpose of preparing a recommendation to the City Council as to which programs and projects should be funded for the FY 2012 program year. 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 funding in previous years. The Commission then worked on the formulation of its list of recommendations. CDBG COMMISSION'S LIST OF RECOMMENDATIONS The Commission had to decide which applicants presented programs and projects which best fit the City's needs, had to insure funding allocations were kept within HUD regulations, and followed the priorities contained in the Affordable Housing Strategic Plan. Listed below is a summary of each applicant's initial request for funding and the Commission's funding recommendations. ECONOMIC DEVELOPMENT APPLICATIONS ED-1 Fort Collins Local Development Company – Revolving Loan Funds for Start- up Companies Amount of Request: $300,000 (Due-on-Sale Loan) CDBG Funding Recommendation: $0 This request seeks to provide monies for a revolving loan fund for start-up companies. Funding for such early-stage companies is not an option through traditional revenue sources, such as the Small Business Administration (SBA). The goal of the project is to create 10 jobs for low- to moderate-income employees. The LDC was formed in 1977 to 3 provide micro-finance funding to local businesses, and has $600,000 in assets to lend. The CDBG funding would augment and mitigate risk for the LDC debt fund. AFFORDABLE HOUSING APPLICATIONS HO-1 City of Fort Collins – Homebuyer Assistance Program - AHF Amount of Request: $50,000 (Due-on-sale Loan) AHF Funding Recommendation: $50,000 (Due-on-sale Loan) AHF The Social Sustainability Department is requesting $50,000 in Affordable Housing Fund (AHF) dollars to assist with homebuyer assistance applications that don’t meet federal guidelines (e.g., rentals) and to provide required City funding program match. The overall program funding is anticipated to serve a minimum of 42 households. For this request, $27,200 will provide for a minimum of five (5) loans, and $22,800 will fund the 12 hours per week needed for the Administrator to operate this City program. The project provides loans up to 6% of the purchase price (to a maximum of $10,000) for downpayment and closing costs for households earning less than 80% of Area Median Income (AMI). HO-2 City of Fort Collins – Homebuyer Assistance Program - HOME Amount of Request: $50,000 (Due-on-sale Loan) HOME Funding Recommendation: $50,000 (Due-on-sale Loan) HOME The Social Sustainability Department is requesting $50,000 in HOME dollars to assist with homebuyer assistance applications. The overall program funding is anticipated to serve a minimum of 42 households. This request is anticipated to serve a minimum of ten (10) loans. The project provides loans up to 6% of the purchase price (to a maximum of $10,000) for downpayment and closing costs for households earning less than 80% of Area Median Income (AMI). HO-3 Fort Collins Housing Authority – Tenant Based Rental Assistance (TBRA) for CDDT Amount of Request: $156,240 (Grant) HOME Funding Recommendation: $156,240 (Grant) HOME As part of a the Community Dual Disorders Team’s (CDDT) collaborative service program, the Fort Collins Housing Authority is submitting an application for HOME funds for the rental assistance component to support chronically homeless people. The $156,240 request would provide for 24 months of rental and deposit assistance for up to 10 individuals suffering from both severe mental illness and a severe substance abuse disorder. HO-4 Fort Collins Housing Authority – Tenant Based Rental Assistance (TBRA) for CDDT - Administration Amount of Request: $17,434 (Grant) AHF Funding Recommendation: $17,434 (Grant) AHF 4 The Fort Collins Housing Authority is requesting $17,434 from the Affordable Housing Fund (AHF) for housing assistance administration that supports the currently requested Tenant Based Rental Assistance funds for the Community Dual Disorders Team (CDDT) treatment program participants. The housing eligibility, compliance, coaching, housing search, lease negotiations, housing retention and re-housing issues are among the functions of the administrative support. HO-5 Housing Authority of Loveland – Larimer Home Improvement Program Amount of Request: $75,000 (Grant) AHF Funding Recommendation: $67,721 (Grant) AHF This a request from the Loveland Housing Authority to provide funding for the Larimer Home Improvement Program (LHIP) which provides low- to no-interest loans for homeowners in Larimer County-- including within the City Limits of Fort Collins--to address health, safety, and energy efficient repairs to their homes. The program is available to families earning no more than 80% of the Area Median Income (AMI), but the average participant is closer to 50% AMI. The Emergency Funds Program provides a one-time-only grant of up to $1,000 to very low income families (50% or below of AMI) who have emergency repair needs (e.g., no hot water, leaking or burst pipes, dangerous electrical issues). HO-6 Villages, Ltd. – Property Acquisition Amount of Request: $1,072,811 (Due-on-sale Loan) CDBG, HOME and AHF Funding Recommendation: $1,072,811(Due-on-sale Loan) CDBG and HOME This request from the non-profit development arm partner of the Fort Collins Housing Authority seeks to provide partial financing for the purchase of 284 affordable rental units at risk of converting to market rate rents. The proposal seeks five percent (5%) of the total purchase price of $21,456,215. The acquisition consists of three adjacent properties at the northeast corner of Horsetooth Road and Shields Street, with a mix of unit types: 1-bedroom (52), 2-bedroom (210), and 3-bedroom (16). The current portfolio serves a range of households between 45% and 80% of Area Median Income (AMI), with the majority of tenant households below 60% AMI. PUBLIC FACILITY APPLICATIONS PF-1 Respite Care – Life Skills Program Area for Teens with Developmental Disabilities Amount of Request: $72,700 (Due-on-sale Loan) CDBG Funding Recommendation: $72,700 (Due-on-sale Loan) CDBG This proposal seeks funding to upgrade the Respite Care facility’s unfinished basement area to provide more effective programming and care for this agency’s youth population, ages 13-21. The universally designed additional space will include: handicap 5 accessibility; plumbing and electrical; walls and ceiling; a separate storage area; a bathroom and small kitchen; patio, fence and walkway; and furnishings. Overall cost of project is $136,200. PF-2 Sexual Assault Victim Advocate Center – SAVA Center Capital Campaign Amount of Request: $300,000 (Due-on-sale Loan) CDBG Funding Recommendation: $175,224 (Due-on-sale Loan) CDBG Request is for funds to support the purchase of 4,000 square feet of program delivery space at 4812 S. College Ave.; to accommodate SAVA’s 14 Fort Collins staff and 3-4 interns. Annually, SAVA provides over 17,000 units of service to over 600 victims of sexual assault from all over Larimer County. SAVA also has an education component, serving 6,000 PSD students. The acquisition cost for the anticipated site is $540,000. PF-3 Turning Point Center for Youth and Family Development Inc. – Wheelchair Accessibility – Mathews Boy’s Facility Amount of Request: $8,500 (Grant) CDBG Funding Recommendation: $8,000 (Grant) AHF The request is for a wheelchair lift purchase and installation at the rear of the current residential boys’ facility, located at 614 Mathews Street. The former facility had wheelchair access. The current facility does not, creating a barrier for both residents with disabilities and family members with disabilities who are visiting or engaged in co- treatment programming. CDBG COMMISSION'S SUMMARY OF RECOMMENDATIONS The CDBG Commission has recommended that $1,670,130 (100.0%) of the available funding be allocated to Affordable Housing and Public Facility programs and projects. The following table summarizes the utilization of funds from all sources. Recommended Funding % of Total Category $0 0.00% Economic Development $1,414,206 84.7% Affordable Housing Programs and Projects $255,924 15.3% Public Facility Projects $1,670,130 100.0% Total Funds Available Attachment 5 contains information from the CDBG Commission meeting on October 11, 2012 outlining how formulation of the funding recommendations was conducted. 1 ATTACHMENT 2 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 Fund monies 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 2 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. 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 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 for a new on-line application process using a web-based platform through a product called ZoomGrants. One form is used in the fall for Housing and Public Facility proposals, while the other form is used in the spring and incorporates questions for all types of applicants. 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. 3 Guidance Charts for CDBG, HOME and Affordable Housing Funding There are two different “ranking sheets” which are used as guidelines for the Competitive Process. Primarily, the components listed serve to ensure that federal regulations and local policies and preferences are being addressed. These guidance charts are one set of many tools to assist the Community Development Block Grant (CDBG) Commission and the Affordable Housing Board (AHB) in Competitive Process decision making. The ranking sheets are completed by staff, based on information provided in proposal applications. 1 ATTACHMENT 3 City Of Fort Collins Affordable Housing Board Draft Minutes of the Priority Ranking Meeting Segment Special Board Meeting 281 N. College Ave. Fort Collins, Colorado September 20, 2012, 4 to 6 p.m. Chair: Dan Byers Staff Liaison: Ken Waido 970-221-6753 City Council Liaison: Lisa Poppaw Board Members present: Dan Byers, Jeff Johnson Troy Jones, Mike Sollenberger, Wayne Thompson Board Members absent: Ben Blonder, Karen Miller Staff present: Ken Waido Council Members present: None Other Staff present: Chadrick Martinez, Development Director, Fort Collins Housing Authority; Kristin Fritz, Senior Project Manager, Fort Collins Housing Authority; Kate Jeracki, Note Taker Guests: Marilyn Heller, League of Women Voters Meeting called to order with a quorum present at 4:15 p.m. by Chair Dan Byers PRIORITY RANKING OF AFFORDABLE HOUSING PROPOSALS — Ken Waido reviewed the six applications for Affordable Housing funds have been received for the fall cycle of the Competitive Process. The Board discussed each request, then assigned priority ranking for recommendations to the Community Development Block Grant (CDBG) Commission. Jeff Johnson recused himself from the discussion because of a conflict of interest; he sits on the board of Funding Partners, which is involved in request HO-6 (Villages Ltd.: Property Acquisition). 2 HO-1 City of Fort Collins: Homebuyer Assistance Program - AHF -- $50,000 loan from the Affordable Housing Fund for the City of Fort Collins Homebuyer Assistance Program (HBA) HO-2 City of Fort Collins: Homebuyer Assistance Program - HOME -- $50,000 loan from HOME funds for the City of Fort Collins Homebuyer Assistance Program The overall program funding is anticipated to serve a minimum of 42 households earning less than 80 percent of Area Median Income (AMI) with loans of up to 6 percent of a home’s purchase price (up to $10,000) for downpayment and closing costs. AHF monies provide the City’s portion of the funding match for CDBG HBA loans; HOME funds provide the required federal match. Funds paid back from loans to homeowners are returned to general Competitive Process coffers. HO-3 Fort Collins Housing Authority: Tenant Based Rental Assistance for CDDT -- $156,240 grant from HOME funds for the Fort Collins Housing Authority’s Tenant- Based Rental Assistance Community Dual Disorders Treatment (CDDT) program HO-4 Fort Collins Housing Authority: Tenant Based Rental Assistance for CDDT Administrative Costs -- $17,434 grant from the Affordable Housing Fund for administrative support for Fort Collins Housing Authority’s Tenant-Based Rental Assistance for CDDT program HO-3 is for the rental assistance component of the Community Dual Disorders Team’s program to support chronically homeless people. The amount requested would provide for 24 months of rental and deposit assistance for up to 10 individuals suffering from both severe mental illness and a severe substance abuse disorder. Such assistance is eligible for HOME funding only. HO-4 is to support administrative functions of the program: eligibility, compliance, coaching, housing search, ease negotiations, housing retention and re-housing issues. HO-4 could be covered by HOME or CDBG funds, but there is no current funding available in those budgets, so the funding must come from the AHF. HO-5 Housing Authority of the City of Loveland: Larimer Home Improvement Program -- $75,000 grant from the Affordable Housing Fund for the Larimer Home Improvement Program (LHIP) LHIP is administered by the Loveland Housing Authority and provides low- and no- interest loans to county homeowners – including within the city limits of Fort Collins – to address health, safety and energy-efficiency repairs to their homes. The program is available to families earning no more than 80 percent AMI, but the average participant is closer to 50 percent. The Emergency Funds Program provides a one-time-only grant of up to $1,000 to very low-income families – 50 percent AMI or below – for emergency repair needs. The amount requested will match the larger state Division of Housing (DOH) grant for housing rehabilitation. Request components are: $42,500 for rehab for an estimated three households; $25,000 for emergency repairs for an estimated 25 households; and $7,500 for program administration. Repaid loans are returned to the program; funds must come from the AHF. 3 HO-6 Villages Ltd.: Property Acquisition -- $1,072,081 loan to Villages Ltd. For Property Acquisition: Phase 1 This request from the nonprofit development arm of the Fort Collins Housing Authority seeks to provide partial financing for the purchase of 284 affordable rental units at risk of converting to market rate rents. The amount requested is 5 percent of the total purchase price of $21,456,215 for three adjacent properties at the northeast corner of Horsetooth Road and Shields Street which serve households between 45 percent and 80 percent of AMI. The applicant has secured significant commitments for other financial layering of the project, which must close by December 15, 2012. Purchase of the property will extend affordability of units to 2043. Chadrick Martinez of the Fort Collins Housing Authority explained that HO-6, the Villages project, is being underwritten by First Bank and Funding Partners. Villages has also applied for a $2 million grant from the Colorado Division of Housing for the first phase of the project. Phase II will be the tax credit phase, in which the nonprofit will take out short-term – 12-24 month – debt for rehabilitation of the units. Dan Byers asked if the financing should fall through on the acquisition, would the units go to market rate rentals. Ken Waido said yes. Martinez explained that the current owner’s 15-year tax credits are expiring at the end of the year. The Villages represents 15 percent of the City’s tax-credit portfolio and has since the early 1990s. If they were to go to market rates, it would take 10-15 years to replace 60-80 units at a time, and longer than 2 years to approve a deal, and another 15 years to get back to where we are right now. He added that the property is worth keeping affordable, given the number of units in one spot, but some components are at the end of their useful life and will require $20,000 to $30,000 per unit to rehab. The location has passed all HUD-required environmental reviews, and FirstBank is not requiring any additional. Full funding of the amount requested is required because of the many pieces of the financial puzzle that need to fit together, Martinez said. If they don’t make the closing, the deal’s off the table. Mike Sollenberger said this was the most exciting opportunity to retain and expand the city’s affordable housing base he has seen and offered kudos to Martinez. He asked if there was enough money to fund all of the projects fully. Ken Waido said that all of the housing projects could be funded, but the CDBG has an additional $680,000 in requests for four additional proposals – three for Public Facilities and one for Economic Development – in the Fall Cycle. After discussion, the Affordable Housing Board gave the proposals the following ranking: 1. HO-6 (Villages: Property Acquisition); recommended full funding 4 2. HO-3 (FCHA: TBRA) and HO-4 (FCHA: TBRA – Administrative Support); partial funding acceptable 3. HO-1 (City of Fort Collins: HBA Program – AHF) and HO-2 (City of Fort Collins HBA Program – HOME); partial funding acceptable 4. HO-5 (Housing Authority of the City of Loveland: LHIP); partial funding acceptable Dan Byers felt they were all good programs, and asked Board members for comments on the rankings to share with the CDBG Commission at its meeting on October 11th. HO-6 was the obvious first choice, and the Board felt it should be fully funded even if other proposals were not. Wayne Thompson pointed out that it keeps a huge number of units affordable, units that would take a decade and a half to replace. Troy Jones said HO-3 and HO-4 are important because of the very-low income population served. Ken Waido added that it is part of the city’s effort to break the cycle of homelessness. Wayne Thompson said it seemed that HO-3 and HO-4 spend a lot of money to help 10 people, and HO-1 and HO-2 provided more bang for the buck. Ken said he expects demand for homebuyer’s assistance will pick up soon, now that the City has hired someone to administer the program. Mike Sollenberger thought HO-5 should be a lower priority because the people served are already in a home. Wayne Thompson felt that it was something that could help people stay in their homes by addressing safety and quality of life issues. -- Meeting adjourned at 6:05 p.m. by Chair Dan Byers. -- 1 ATTACHMENT 4 Background Information on the Community Development Block Grant (CDBG) and HOME Investment Partnership (HOME) Programs COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) PROGRAM CDBG PROGRAM NATIONAL OBJECTIVES The primary objective of the CDBG Program is the 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. HUD regulations require at least 70% of CDBG funds be used for activities that primarily benefit low and moderate-income persons. National Objectives Low/Moderate Income Benefit Slum/Blight Elimination Urgent Need National Average 90% 10% 0% City Expenditures for: 2011 100% 0% 0% 2010 100% 0% 0% 2009 100% 0% 0% 2008 100% 0% 0% 2007 100% 0% 0% 2006 100% 0% 0% 2005 100% 0% 0% 2004 100% 0% 0% 2003 100% 0% 0% 2002 100% 0% 0% 2 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. HOME INVESTMENT PARTNERSHIP (HOME) 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. 3 ELIGIBLE PROJECTS: HOME funds must be used in the following ways: 1. DIRECT HOUSING ASSISTANCE: Down payment assistance: To help low-income individuals to purchase housing for their principal residence. Applicants must meet income guidelines of no more than 80% of the current 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 $10,000 to help cover downpayment and closing cost expenses. The funding is repaid with a 5% simple interest charge when the property is sold or transferred out of the buyer’s name. Tenant based rental assistance: To help low-income households avoid eviction and homelessness, TBRA provides up to two years of housing subsidy and case management services to stabilize households and put them on the road to self- sufficiency. 2. 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 community housing development organizations (CHDOs), non-profit agencies, and for-profit developers. 3. 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 and 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 $212,015. 4 HOME PROGRAM PRIORITIES The 2010-2014 Consolidated Plan, a planning document required for HUD by entities receiving federal monies for housing and community development activities, 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. 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. 1 ATTACHMENT 5 Community Development Block Grant (CDBG) Commission Funding Deliberations 215 N. Mason Street, Fort Collins, Colorado October 11, 2012, 5:30 p.m. COMMISSION MEMBERS PRESENT: Kay Rios, Chair Anita Basham Robert Browning Catherine Costlow Jamaal Curry Margaret Long Emily Sander Kristin Stephens COMMISSION MEMBERS ABSENT: Gordon Coombes STAFF PRESENT: Mackenzie Cartin, Intern; Heidi Phelps; Beth Rosen; Sharon Thomas; Ken Waido OTHERS PRESENT: Ray Roth, citizen; Julie Brewen, Executive Director, Fort Collins Housing Authority; Jennifer Jones, Executive Director, SAVA; other citizens; Kate Jeracki, Note Taker The meeting was called to order by Chair Kay Rios at 6 p.m. The purpose of the meeting was to allocate funds requested during the 2012 Fall Cycle of the Competitive Process. The Commission deliberated one Economic Development request; six Housing requests; and three Public Facility requests. ED-1 Fort Collins Local Development Company: Revolving Loan Funds for Start-up Companies -- $300,000 requested Anita Basham moved that the Commission award zero funding to ED-1. Margaret Long seconded. Basham said this request was not a high priority for CDBG funding. Long added that the proposal presentation had not been persuasive, and suggested that more tracking of the present program might produce more results. Kristen Stephens said that even though it was presented as providing jobs, those jobs were in high tech, not for those having a hard time finding any kind of work, and she questioned the actual impact of the proposal. Motion passed unanimously. Zero funding recommended. 2 HO-1 City of Fort Collins Homebuyer Assistance (HBA) Program -- $50,000 from the Affordable Housing Fund Bob Browning moved the Commission fully fund HO-1. Emily Sander seconded. Browning said he liked the flexibility of using Affordable Housing Funds to provide short-term funding to help get people into homes. Motion passed unanimously. Full funding recommended. HO-2 City of Fort Collins Homebuyer Assistance (HBA) Program -- $50,000 from HOME funds Bob Browning moved the Commission fully fund HO-2. Jamaal Curry seconded. Browning said this program has been doing a lot of good for a long time, and he liked that it is now helping with refinancing. Curry said the Commission should always support homeownership. Motion passed unanimously. Full funding recommended. HO-3 Fort Collins Housing Authority: Tenant-Based Rental Assistance (TBRA) for the CDDT Program -- $156,240 requested Emily Sander moved that the Commission fully fund HO-3. Margaret Long seconded. Sander said this proposal helps a vulnerable population, and she liked the inclusion of case management and other services that are important for success. Motion passed 7-0, with Kay Rios abstaining. Full funding recommended. HO-4 Fort Collins Housing Authority: Tenant-Based Rental Assistance (TBRA) for the CDDT Program--Administrative Support -- $17,434 requested Emily Sander moved that the Commission fully fund HO-4. Bob Browning seconded. Sander said this money was necessary to support the program. Browning liked that the funds had to come out of the Affordable Housing Fund. Motion passed 7-0, with Kay Rios abstaining. Full funding recommended. HO-5 Housing Authority of the City of Loveland: Larimer Home Improvement Program -- $75,000 requested Kristen Stephens moved the Commission fully fund HO-5. Margaret Long seconded. 3 Stephens said it was important to help low-income residents stay in the homes they already own by providing assistance with emergency repairs for safety issues, like water heaters. Margaret Long said she was glad to hear that the program also funds energy efficiency services to mobile homes, which often have no other resources available. Motion passed 5-2, with Jamaal Curry abstaining, Bob Browning and Emily Sander opposed. Bob Browning moved to reduce funding for HO-5 to $67,721. Kay Rios seconded. Browning explained that the small reduction doesn’t affect the program, which has surplus funds available from previous years, and it balances the expenditures in the Affordable Housing Fund. Motion passed unanimously. Partial funding of $67,721 recommended. HO-6 Villages Ltd.: Property Acquisition -- $1,072,811 requested Bob Browning moved the Commission approve full funding for HO-6. Kristen Stephens seconded. Browning pointed out that the Affordable Housing Board had ranked this request as its first priority. It presents a unique opportunity to preserve 284 existing affordable housing units and the Commission should jump on it. Motion passed unanimously. Full funding recommended. PF-1 Respite Care: Life Skills Program Area for Teens with Developmental Disabilities -- $72,700 requested Bob Browning moved the Commission fully fund PF-1. Kristen Stephens seconded. Browning said Respite Care is a good program, and this is a good public facility project not in the housing arena. Stephens pointed out that this is the only child care program for children with disabilities, and they really need the space for older youth programming. Motion passed unanimously. Full funding recommended. PF-2 Sexual Assault Victim Center (SAVA): SAVA Center Capital Campaign -- $300,000 requested Anita Basham moved that the Commission fund PF-2 at the reduced amount of $200,000. Jamaal Curry seconded. Basham said she understood that in negotiations with City staff, SAVA indicated that $200,000 would be acceptable to help with moving to a larger location. Curry said he supported the work the organization is doing for the population served. Margaret Long added that providing treatment for the incredible damage done to victims of sexual assault can save lives and money in other support programs. Kay Rios pointed out that the majority of SAVA clients are from Fort 4 Collins. Kristen Stephens said that SAVA is actively pursuing other funding, and with the whole community supporting it, the Commission should, too. Motion passed 6-2, with Bob Browning and Catherine Costlow opposed. Bob Browning moved the Commission reduce funding to PF-2 to $175,224. Kay Rios seconded. Browning said that while he is in favor of the program and hates to see the numbers reduced at all--given other priorities, the City does not have funds available to give that that large of an allocation to SAVA at this time. Margaret Long said she had concerns about that much of a cut, especially since the majority of SAVA clients are from Fort Collins. She wondered if it would be possible to reduce the amount Respite Care is requesting for furniture, so SAVA would have to take a smaller cut. Margaret Long offered a friendly amendment to reduce the proposed reduction of $24,776 by $15,000. Bob Browning did not accept the amendment. Kristen Stephens said she agreed with Browning. She did not want to see Respite Care funding reduced, and SAVA is seeking additional funding from other sources. She said she was in favor of the motion as it stands. Kay Rios also agreed. Motion passed 7-1, with Margaret Long opposed. Partial funding of $175,224 approved. PF-3 Turning Point Center for Youth and Family Development, Inc.: Wheelchair Accessibility -- $8,500 requested from CDBG funds Kristen Stephens moved the Commission approve full funding for PF-3. Anita Basham seconded. Stephens said this is very little money to provide something that is greatly needed. Bob Browning offered a friendly amendment to reduce the amount funded to $8,000, with the stipulation the money comes out of the Affordable Housing Fund. Kay Rios explained that the additional $500 was for an impact study required for federal CDBG funds but not for the City’s AHF. Stephens and Basham both accepted the amendment. The amended motion passed unanimously. Funding for $8,000 from the Affordable Housing Fund recommended. Staff updated the draft Funding Matrix to reflect the CDBG Commission’s decisions. In response to a question from Anita Basham, Sharon Thomas explained that the final amounts in each HOME and CDBG subaccount had been redistributed to balance the final numbers. Bob Browning moved that the Commission approve the final Funding Matrix as presented. Kristen Stephens seconded. Motion passed unanimously. Meeting adjourned at 6:35 p.m. RESOLUTION 2012-105 OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROVING THE PROGRAMS AND PROJECTS THAT WILL RECEIVE FUNDS FROM THE FEDERAL COMMUNITY DEVELOPMENT BLOCK GRANT AND HOME INVESTMENT PARTNERSHIP PROGRAMS, AND THE CITY’S AFFORDABLE HOUSING FUND WHEREAS, the Community Development Block Grant (CDBG) Program and the Home Investment Partnerships (HOME) Program are ongoing grant administration programs funded by the Department of Housing and Urban Development (HUD); and WHEREAS, the City has received CDBG Program funds since 1975 and HOME Program funds since 1994; and WHEREAS, the City Council has budgeted General Fund dollars into an Affordable Housing Fund for use in assisting affordable housing programs and projects; 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 and projects, and community development activities; and WHEREAS, in January and September 2012, the CDBG Commission held two public hearings to obtain citizen input on community development and affordable housing needs, and since then has heard presentations and asked clarification questions from each applicant that submitted a proposal to the City requesting funding; and WHEREAS, on October 11, 2012, the CDBG Commission met in a special meeting for the purpose of preparing a recommendation to the City Council as to which programs and projects should be funded with carry-over FY 2010 and 2011 CDBG funds, HOME funds from the FY 2011 and 2012 HOME grants, HOME Program Income, and funds from the City’s Affordable Housing Fund; and WHEREAS, as required by HUD regulations, a 30-day public comment period on the proposed allocation of CDBG and HOME funds as recommended by the CDBG Commission began on October 15, 2012 and ended on November 13, 2012; and WHEREAS, the City Council has considered the recommendations of the CDBG Commission, and has determined that the City’s 2012 allocation should be made as set out in this Resolution. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS that City staff is hereby authorized to submit an application to HUD as follows: AFFORDABLE HOUSING $50,000 City of Fort Collins: Homebuyer Assistance Program – Affordable Housing Funds Affordable Housing Funds $50,000 City of Fort Collins: Homebuyer Assistance Program – HOME Funds HOME Funds $156,240 Fort Collins Housing Authority: Tenant Based Rental Assistance for CDDT HOME Funds $17,434 Fort Collins Housing Authority: Tenant Based Rental Assistance for CDDT – Administrative Support Affordable Housing Funds $67,721 Housing Authority of the City of Loveland: Larimer Home Improvement Program Affordable Housing Funds $1,072,811 Villages, Ltd.: Property Acquisition HOME and CDBG Funds PUBLIC FACILITY $72,700 Respite Care: Life Skills Program Area for Teens with Developmental Disabilities CDBG Funds $175,224 Sex Assault Victim Advocate Center (SAVA): Capital Campaign CDBG Funds $8,000 Turning Point Center for Youth and Family Development: Wheelchair Accessibility – Mathews Boy’s Facility Affordable Housing Funds Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 20th day of November A.D. 2012. Mayor Pro Tem ATTEST: City Clerk ORDINANCE NO. 131, 2012 OF THE COUNCIL OF THE CITY OF FORT COLLINS AUTHORIZING THE TRANSFER OF APPROPRIATIONS BETWEEN PROGRAM YEARS IN THE COMMUNITY DEVELOPMENT BLOCK GRANT FUND WHEREAS, unexpended funds are available from the Community Development Block Grant (CDBG) program from prior fiscal years in the amount of $750,000; and WHEREAS, the unexpended appropriations are available to be transferred and re-allocated to a 2012 CDBG program; and WHEREAS, by adoption of Resolution 2012-105 the City Council approved the 2012 Community Development Block Grant Program; and WHEREAS, Article V, Section 9 of the City Charter permits 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 for that fiscal year, does not exceed the current estimate of actual and anticipated revenues to be received during the fiscal year; and WHEREAS, Article V, Section 10, of the City Charter authorizes the City Council to transfer by ordinance any unexpected and unencumbered amount or portion thereof from one fund or capital project to another fund or capital project, provided that the purpose for which the funds were initially appropriated no longer exists; and WHEREAS, Article V, Section 11, of the City Charter provides that federal grant appropriations shall not lapse if unexpended at the end of the budget year until the expiration of the federal grant; and WHEREAS, City staff has determined that the appropriation of all unanticipated CDBG grant and program revenue as described herein will not result in total appropriations in excess of the current estimate of actual and anticipated revenues for fiscal year 2012. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS that the unexpended and unencumbered amount of SEVEN HUNDRED FIFTY THOUSAND DOLLARS ($750,000) is hereby authorized for transfer from the 2010 and 2011 Community Development Block Grant Program to the 2012-2013 Community Development Block Grant Program and appropriated therein. Introduced, considered favorably on first reading, and ordered published this 20th day of November, A.D. 2012, and to be presented for final passage on the 4th day of December, A.D. 2012. _________________________________ Mayor Pro Tem ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 4th day of December, A.D. 2012. _________________________________ Mayor ATTEST: _____________________________ City Clerk Public Facility Category Applicant Project/Program Funding Request Commission’s Recommendation Unfunded Balance Percent of Request Funded PF-1 Respite Care: Life Skills Program Area for Teens with Developmental Disabilities $72,700 $72,700 CDBG $0 100% PF-2 SAVA: Capital Campaign $300,000 $175,224 CDBG $124,776 71% PF-3 Turning Point Center for Youth and Family Development: Wheelchair Accessibility $8,500 $8,000 AHF (Grant) $500 94% All funding recommendations in the Public Facility category are in the form of a “Due on Sale Loan + 5% Simple Interest” unless noted as a grant. The CDBG Commission has recommended all (100%) of the available funding amount of $1,670,130 be allocated. Because there are not enough funds available to fund all proposals, the Commission has recommended that the economic development proposal receive 0% of its funding request. Economic development is a lower priority in the Consolidated Plan. Of the six affordable housing proposals, five are being recommended for full funding, and the sixth (Housing Authority of Loveland: LHIP) is receiving a recommendation for funding at 90% of the request. All three public facility proposals are being recommended for funding, one full and two partial. SAVA is being recommended for 71% of its request and Turning Point for 94% of its request. The justifications for the CDBG Commission’s recommendations can be found in Attachment 5.