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HomeMy WebLinkAbout11197RESOLUTION NO. 11197 A RESOLUTION APPROVING AN AGREEMENT BETWEEN HABITAT FOR HUMANITY OF PUEBLO, INC., A COLORADO NON - PROFIT CORPORATION AND THE CITY OF PUEBLO, A MUNICIPAL CORPORATION, AND AUTHORIZING THE PRESIDENT OF THE CITY COUNCIL TO EXECUTE SAME BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. The Agreement dated January 14 2008 between Habitat for Humanity of Pueblo, Inc., a Colorado Non - Profit Corporation and the City of Pueblo, a Municipal Corporation, ( "the Agreement "), for the construction of new affordable for -sale single family housing, a copy of which is attached and incorporated herein, having been approved as to form by the City Attorney, is hereby approved. SECTION 2- The President of the City Council is hereby authorized to execute Agreement in the name of the City and the City Clerk is directed to affix the seal of the City thereto and attest same. INTRODUCED January 14, 2008 BY Judy Weaver Councilperson APPROVED. PRESIDENT OF THE CITY COUNCIL ATTESTED BY: ITY CLERK Rcs Il01 Background Paper for Proposed RESOLUTION AGENDA ITEM # g DATE: JANUARY 14, 2008 DEPARTMENT: HOUSING AND CITIZEN SERVICES / ADA RIVERA CLARK TITLE A RESOLUTION APPROVING AN AGREEMENT BETWEEN HABITAT FOR HUMANITY OF PUEBLO, INC., A COLORADO NON- PROFIT CORPORATION AND THE CITY OF PUEBLO, A MUNICIPAL CORPORATION, AND AUTHORIZING THE PRESIDENT OF THE CITY COUNCIL TO EXECUTE SAME ISSUE To approve an agreement between the City of Pueblo and Habitat for Humanity of Pueblo, Inc., (HFH) for the undertaking of their affordable housing construction and mortgage loan program within the City for low and moderate income families. RECOMMENDATION Approve BACKGROUND The City of Pueblo receives a yearly allocation of HOME funds. As part of the allocation there is a mandatory set -aside for Community Development Housing Corporations (CHDO). Fifteen percent must be set -aside for these agencies. Habitat for Humanity qualifies as an eligible CHDO under the guidelines. Therefore the City wishes to enter into an agreement with HFH to provide new single family homes within the City limits. Under the Agreement the City would provide $135,000 in HOME funds for construction and administrative costs. FINANCIAL IMPACT Funding is available in the 251 Fund and has been appropriated for these purposes. It the City does not have any eligible CHDO or activities the funds are recaptured by HUD. AGREEMENT FOR AFFORDABLE NEW HOME CONSTRUCTION AND MORTGAGE SERVICES (HOME -CHDO) This Agreement is made and entered into this 14th day of January, 2008, by and between the City of Pueblo, a Municipal Corporation (hereinafter referred to as "City") and Habitat for Humanity of Pueblo, Inc., a Colorado Non -Profit Corporation (hereinafter referred to as "Subrecipient "). WITNESSETH, that: WHEREAS, the City has entered into agreements with the U. S. Department of Housing and Urban Development ( "HUD "), whereby federal financial assistance may be made available to City on behalf of the Pueblo Consortium ( "Consortium ") established under Agreements between the City and Pueblo County, Colorado, as a participating jurisdiction for the purpose of expanding the availability of affordable housing pursuant to the Home Investment Partnerships Act ( "the Act ") (42 U.S.C. 12701 et. seq.), the Cranston - Gonzales National Affordable Housing Act and implementing regulations, including but not limited to those at 24 CFR Part 92; and WHEREAS, in accordance with the provisions of the Act and 24 CFR Sections 92.205(a)(1), 92.300 and 92.301, a portion of such financial assistance, subject to deobligation (and subject to appropriation with respect to any assistance payable out of future fiscal year allotments), may be made available to qualifying subrecipients for the purpose of carrying out specific elements of the participating jurisdiction's housing strategy including construction ofnew affordable owner occupied non -luxury housing and reimburse the recipient for a portion of authorized operating expenses which relate to such elements of the housing strategy; and WHEREAS, Subrecipient has represented to City that it is a duly qualified community housing development organization ( "CHDO ") within the meaning of 24 CFR §92.2, and is eligible and willing to undertake certain approved elements of City's housing strategy, including construction of new affordable owner - occupied housing located within the City and the making of mortgage loans in connection with the sale of such housing to qualified low and moderate income buyers, as identified herein and in the Scope of Services attached hereto; and WHEREAS, federal financial assistance is necessary and required for such new housing construction in order to maintain affordable housing in the specified neighborhood; and WHEREAS, based upon Subrecipient's representations, the City believes Subrecipient is capable or can reasonably be expected to become capable of carrying out said approved elements of City's housing strategy, including the undertaking of a new affordable housing construction and mortgage loan program within the City for low and moderate income families, and City is willing to allocate federal funds to or for the benefit of Subrecipient for investment in such housing to be constructed by Subrecipient in full compliance with said approved elements of City's housing strategy; and WHEREAS, the City and Consortium intend for this Agreement to, in part, fulfill the Consortium's obligations for allocation of HOME funds to CHDO's pursuant to 24 CFR §92.300. NOW, THEREFORE, in consideration of the foregoing recitals and the covenants, terms and conditions set forth herein, the parties agree as follows: 1. PROGRAM AND SUBRECIPIENT SERVICES (a) The Neighborhood Subrecipient will undertake the Program, as hereinafter defined, within the geographic boundaries of Pueblo, Colorado, hereinafter referred to as the "Neighborhood ". (b) The Program Subrecipient shall, at Subrecipient's own cost and expense, do all things necessary and appropriate, in strict accordance with the requirements of this Agreement, to conduct its City -Wide Affordable New Housing Program (the "Program "). The Program is described in Subrecipient's application for funding to the Consortium, as revised and approved by City, and will entail planning, acquisition of building sites, construction of new single family affordable housing units, and originating and servicing mortgage loans for such newly constructed owner - occupied housing located in the Neighborhood. The Program shall be operated in conformance with the requirements of 24 CFR Part 92. With the HOME funds provided under this Agreement, Subrecipient shall assist in the construction of not less than 3 homes with assistance under this Agreement for acquisition of construction costs not to exceed the maximum eligible amount per housing unit. Additionally, up to but not exceeding 5% of the HOME assistance provided under this Agreement or $6,750 of the HOME assistance provided hereunder, whichever is less, may be used by Subrecipient for eligible administrative costs related to the Program. 2. FINANCIAL ASSISTANCE (a) Subject to and contingent upon Subrecipient complying with all requirements ofthis Agreement, and subject to the availability of HOME funds for the Program, City commits to invest HOME and, at City's sole option, other funds in the Project in an amount not to exceed in the aggregate One Hundred Thirty -Five Thousand Dollars (U.S. $135,000.00) allocated as follows: (i) for Owner- Occupied new construction and loans to be originated by Subrecipient, an amount not to exceed $128,250; and (ii) for reasonable eligible administrative expenses associated with the Program, an amount not to exceed $6,750. (b) The full amount of the assistance referred to above will be furnished to the Program as a grant to Subrecipient, hereinafter referred to as the "Grant ", which Grant is subject to all terms and conditions of this Agreement and contingent upon Subrecipient executing all documents required by City and submitting periodic disbursement requests accompanied by documentation establishing justification for each requested disbursement. Provided that Subrecipient is not in default of any provisions of this Agreement, the Grant shall be disbursed in accordance with the provisions of paragraphs 3 and 6 of this Agreement. -2- 3. USE OF GRANT FUNDS The Grant funds will be disbursed to Subrecipient on a periodic basis for allowed Program expenditures and administrative costs. At no time will funds for administrative expenses be advanced before the reasonable administrative costs are actually incurred. 4. SUBRECIPIENT WARRANTIES AND COMMITMENTS (a) Subrecipient warrants and represents that (i) it has the requisite authority and capacity to perform all terms and conditions on Subrecipient's part to be performed hereunder; (ii) that it is duly organized as a non -profit corporation under state law and is in good standing with the Secretary of State of Colorado; (iii) that it meets, or before accepting any payment hereunder will meet, the organizational, membership and accountability requirements of community housing development organizations as that term is defined and limited in 24 CFR §92.2; (iv) that it is aware of and understands its duty to perform all functions and services in accordance with the regulatory requirements of 24 CFR Part 92 and those identified in Exhibit "C" hereto; and (v) that it is accepting federal financial assistance hereunder subject to certain mandatory repayment provisions. (b) Time is of the essence hereof. Subrecipient agrees that it shall commit and initially invest all funds made available within 24 months of the date of this Agreement. 5. CITY REPRESENTATIVE The City shall designate a representative of the City who will be authorized to make all necessary decisions required of the City on behalf of the Consortium in connection with the performance of this Agreement, approval of the Program to be undertaken by Subrecipient hereunder and the disbursement of funds in connection with operation of the Program. In the absence of such a designation, the City's Director of Housing and Citizen Services shall be deemed as City's authorized representative. 6. DISBURSEMENTS (a) Subrecipient shall not request disbursement of any Grant funds under this Agreement until the funds are needed for reimbursement of reasonable eligible costs incurred or for qualifying progress payments, as the case may be. Disbursement of funds to Subrecipient, as maybe authorized under this Agreement, is subject to all of the following requirements, which shall be conditions precedent to payment: (i) that the Subrecipient has expended funds after date of this Agreement for reasonable eligible approved expenditures with respect to the Program, (ii) that Subrecipient is not in default of any material provision of this Agreement nor applicable law or regulation, (iii) that Subrecipient has timely submitted requests for disbursement detailing the eligible expenditures for the Program in a format approved by City, (iv) that Subrecipient has certified with each payment or disbursement request compliance with the requirements identified in Exhibit "C" and that all expenditures for which disbursement is sought were made for and in furtherance of the Program and are an eligible use of federal assistance under the Act, and (v) that City has timely received from HUD sufficient federal assistance under the Act to pay the disbursement hereunder. -3- (b) Payment hereunder is also subject to and may only be disbursed in accordance with HUD regulations including but not limited to those at 24 CFR Part 92, as presently promulgated and as same may be revised from time to time in the future. All payments received by Subrecipient hereunder are subject to repayment by Subrecipient as provided in 24 CFR Part 92. Funds provided hereunder for Program may only be used for eligible activities and costs, as provided in 24 CFR Part 92. (c) The aggregate of all payments made pursuant to this Agreement shall not exceed One Hundred Thirty -Five Thousand Dollars (U.S. $135,000.00) which includes $6,750.00 toward reasonable eligible administrative expenses of Subrecipient related to the Program. (d) Notwithstanding anything in this Agreement, and in addition to all other conditions precedent, the City may, in its sole discretion, refuse to make the Grant or suspend or terminate further disbursements of Grant funds, if it has cause to believe any of the following circumstances has occurred or exists: (i) There has been any adverse material change in Subrecipient's ability to operate the Program or in the Program itself; (ii) Subrecipient has misapplied Grant funds for other than the purposes stated in this Agreement; (iii) Subrecipient has defaulted in the performance of any term, condition or covenants set forth in this Agreement or required of Subrecipient under the applicable federal regulations. (e) Upon expiration of the term of this Agreement, or upon any prior termination, Subrecipient shall transfer to City any funds provided hereunder which are on hand at the time of expiration or termination together with any accounts receivable attributable to the use of funds provided hereunder. 7. TERM OF AGREEMENT Unless sooner terminated, the term of this Agreement, for purposes of disbursement of Grant funds and completion of the Program, shall be from the date of execution hereof until January 14, 2010; provided however, that with the respect to owner - occupied mortgage loans made under the Program for which Subrecipient has received financial assistance under and during the term of this Agreement, Subrecipient shall have continuing responsibility to comply with all applicable performance, certifications, repayment, affirmative marketing, housing affordability compliance and recordkeeping requirements of this Agreement, and 24 CFR Part 92 (including, without limitation 24 CFR Sections 92.252, 92.254, 92.301, 92.351 and 92.508) which shall survive expiration or termination and remain in effect throughout the applicable required full period of affordability, notwithstanding termination or expiration of this Agreement. As used herein, "period of affordability" shall be twenty (20) years from the date of loan closing on each home constructed as part of the Program, or for the full term of the loan made by Subrecipient to the first homeowner, whichever is longer. -4- 8. TERMINATION OF AGREEMENT (a) For Cause This Agreement may be terminated by City for cause, including any nonperformance by Subrecipient, upon ten (10) days written notice to Subrecipient including a statement of the reasons therefor, and after an opportunity for a hearing has been afforded. If a hearing is requested, it shall be held before the City's Director of Housing and Citizen Services whose decision as to both the grounds for termination and the appropriateness thereof shall be final and binding upon both City and Subrecipient. In accordance with 24 CFR 85.43, cause for termination shall include any material failure by Subrecipient to comply with any term of this Agreement. (b) For Convenience This Agreement may be terminated for convenience in accordance with the provisions of 24 CFR 85.44. This Agreement shall terminate immediately upon any non - appropriation of funds, or upon any suspension or non - receipt of federal assistance provided to City under the Act, regardless of cause. (c) Post Termination Procedures In the event of termination, Subrecipient shall continue to be responsible for those matters which survive termination, including those identified in paragraphs 4, 7, 11, 13, 14, 15, 16, 17, and 18 of this Agreement, unless City takes over the Program and, in connection therewith, prospectively releases Subrecipient from one or more specific responsibilities in writing. Additionally, at City's sole option, all property acquired by Subrecipient with grant funds, all grant funds, program income, and mortgage loans originated with Grant funds or by payments therefrom and payments received under such mortgage loans, held, owned or retained by Subrecipient shall immediately become the sole and separate property of the City and Subrecipient shall perform all acts and execute all instruments necessary to transfer and assign such property, funds, income, and mortgage loans to City. All finished or unfinished plans, specifications, documents, data, studies, reports and work product prepared by Subrecipient under this Agreement or with Grant funds shall, at the option of the City, become its property and Subrecipient may be entitled to receive just and equitable compensation only for satisfactory work completed and eligible costs for which compensation has not previously been paid nor reimbursement made. 9. ASSIGNABILITY This Agreement shall not be assigned or transferred by Subrecipient without the prior written consent of the City. Any assignment or attempted assignment made in violation of this provision shall, at City's election, be deemed void and of no effect whatsoever. 10. CONFLICT OF INTEREST HOME Regulation 24 CFR, Part 92.356 is incorporated herein by reference, and sets forth applicable laws and regulations that apply to Conflict of Interest. Subrecipient, and its Board of Directors, officers and employees, shall avoid all conflicts prohibited by applicable regulations, including but not limited to those set forth in 24 CFR Part 92 as presently promulgated and as same may be revised from time to time in the future. -5- 11. SUBRECIPIENT RECORDKEEPING Subrecipient shall maintain records as to the Program work and activities undertaken with assistance hereunder, services provided, reimbursable expenses incurred in connection with the Project and complete accounting records. Accounting records shall be kept on a generally recognized accounting basis and as requested by the City's auditor. Subrecipient agrees to comply with all applicable uniform administrative requirements described or referenced in 24 CFR Part 92. The compliance provisions attached as Exhibit "B" hereto are also made a part of this Agreement, and Subrecipient agrees to perform and comply with same. The City, HUD, the Comptroller General of the United States, the Inspector General of HUD, and any of their authorized representatives, shall have the right to inspect and copy, during reasonable business hours, all books, documents, papers and records of Subrecipient which relate to this Agreement for the purpose of making an audit or examination. Upon completion of the work and end of the term of this Agreement, or at any time during the period of affordability or within 5 years thereafter, the City may require all of Subrecipient's financial records relating to this Agreement to be turned over to the City. 12. MONITORING AND EVALUATION The City shall have the right to monitor and evaluate the progress and performance of Subrecipient to assure that the terms of this Agreement are being satisfactorily fulfilled in accordance with HUD's, City's and other applicable monitoring and evaluation criteria and standards. The City shall at least quarterly review Subrecipient's performance using on -site visits, progress reports required to be submitted by Subrecipient, audit findings, disbursement transactions and contact with Subrecipient as necessary. Subrecipient shall furnish to the City monthly or quarterly program and financial reports of its activities in such form and manner as may be requested by the City. Subrecipient shall fully cooperate with City relating to such monitoring and evaluation. 13. SUBRECIPIENT FILES AND INFORMATION REPORTS Subrecipient shall maintain files containing information which shall clearly document all activities performed in conjunction with this Agreement, including, but not limited to, financial transactions, conformance with assurances, activity reports, and program income. These records shall be retained by Subrecipient for a period of five years, except that with respect to each property rehabilitated with assistance provided hereunder, such records shall be maintained for the full required period of affordability for such property. Activity reports shall be submitted monthly or quarterly no later than the ninth day of the month following the end of month or quarter for which the report is submitted. 14. INDEPENDENCE OF SUBRECIPIENT Nothing herein contained nor the relationship of Subrecipient to the City, which relationship is expressly declared to be that of an independent contractor, shall make or be construed to make Subrecipient or any of Subrecipient's agents, contractors, consultants or employees the agents or employees of the City. Subrecipient shall be solely and entirely responsible for its acts and the acts of its agents, employees and subcontractors. 15. LIABILITY & INSURANCE (a) As to the City, Subrecipient agrees to assume the risk of all personal injury, including death and bodily injury, and damage to and destruction of property, including loss of use therefrom, M caused by or sustained, in whole or in part, in conjunction with or arising out of the performance or nonperformance of this Agreement by Subrecipient, construction or rehabilitation of improvements upon any property or by the conditions created thereby or resulting therefrom. Subrecipient further agrees to indemnify and save harmless the City, its officers, agents, attorneys and employees, from and against any and all claims, liabilities, costs, expenses, penalties and attorney fees arising from such injuries to persons or damages to property or based upon or arising out of the performance or nonperformance of this Agreement by Subrecipient, construction or rehabilitation of properties under the Program, origination and servicing of rehabilitation loans, or arising from the warranties relating to any of the foregoing or out of any violation by Subrecipient of any statute, ordinance, rule or regulation. (b) Subrecipient agrees that it shall procure and will maintain during the term of this Agreement, such insurance as will protect it from claims under workers' compensation acts, claims for damages because of personal injury including bodily injury, sickness or disease or death of any of its employees or of any person other than its employees, and from claims or damages because of injury to or destruction of property including loss of use resulting therefrom; and such insurance will provide for coverage in such amounts as set forth in subparagraph (c). (c) The minimum insurance coverage which Subrecipient shall obtain and keep in force is as follows: (i) Workers' Compensation Insurance complying with statutory requirements in Colorado. (ii) Comprehensive General Liability ( "CGL ") Insurance written on ISO Form CG 00 01 0196, or a substitute form providing equivalent coverage, with a limit not less than One Million Dollars ($1,000,000.00) per occurrence, covering liability arising from premises, operations, independent contractors, personal injury, products completed operations, and liability assumed under an insured contract, on an occurrence basis. The policy shall identify the City as an additional insured. (d) Subrecipient shall furnish a certificate of insurance certifying the required insurance coverages to City's Director of Finance prior to disbursement of any funds to Subrecipient under this Agreement. The certificate of insurance and the policies shall name the City as an additional insured on the CGL policy. 16. CERTIFICATIONS Subrecipient agrees to execute and abide by the certifications contained in Exhibit "C" hereto, which are hereby expressly made a part of this Agreement. 17. PROGRAM INCOME; REVERSION OF ASSETS (a) Unless otherwise authorized by City in writing in a separate instrument executed after date of this Agreement, all program income, as defined in 24 CFR 92.2, shall be returned to City within 30 days of receipt by Subrecipient. In the event City authorizes Subrecipient to retain any -7- portion of program income, it shall only be used to accomplish the work set forth in this Agreement, including the Scope of Services, and the amount of funds payable by City to Subrecipient shall be adjusted as provided by 24 CFR 92.503 and the applicable requirements of 24 CFR 85. (b) Upon expiration of the term of this Agreement, or upon any prior termination, Subrecipient shall transfer to City any funds provided hereunder which are on hand at the time of expiration or termination together with any accounts receivable attributable to the use of funds provided hereunder. (c) The Program, the housing units constructed thereunder, and any other real property acquired, constructed or improved in whole or in part with funds provided pursuant to this Agreement shall be used only to create affordable housing. In the event any assisted property is not or ceases to be so used, Subrecipient shall immediately take steps to recover an amount equal to the current market value.of the property less any portion of the value attributable to expenditures of funds not provided under this Agreement for the construction of the property (that is, the calculation of the portion of value attributable to expenditures not provided by City under this agreement shall be the market value multiplied by a fraction whose numerator is the total determined as of the date of substantial completion less the amount of assistance provided by City and whose denominator is the total value of the property determined as of the date of substantial completion or, (ii) the remaining principal balance and accrued interest owing under the mortgage loan. The use restriction and repayment obligation set forth in this subparagraph shall survive termination or expiration of this Agreement and shall be fully enforceable and subject to collection by City or HUD in accordance with applicable laws. In order to secure the affordability requirements hereunder, Subrecipient shall either (i) record enforceable deed restrictions to such effect for each housing unit or (ii) require the homeowner of each new housing unit to execute a Deed of Trust which shall be and constitute a lien upon the property (and all other real property acquired or improved with funds provided hereunder) conveyed to the homeowner which shall expressly secure the affordability requirements hereunder. (d) In the event City incurs any cost or expense in enforcing the requirements of this Agreement, including but not limited to the requirements of this paragraph 17, or in bringing any action to recover the amount of any repayment obligation, or, upon assignment of the Note and the mortgage or Deed of Trust to City, to foreclose or obtain sale under the Deed of Trust or mortgage instrument, City shall be entitled to recover its costs and expenses, including reasonable attorneys fees. 18. RECOGNITION OF HUD, CITY In all printed materials, Program descriptions and other activities undertaken with funds provided under this Agreement, Subrecipient shall provide recognition that funds have been provided to Subrecipient by the U.S. Department of Housing and Urban Development and the City of Pueblo. Recognition shall be accomplished by disclosure of the role of HUD and the City in all such printed materials and project signage, if any. However, such recognition and signage shall also prominently set forth the following statement: 'By providing funds to Habitat for Humanity of Pueblo, Inc., neither the City of Pueblo nor the U.S. Department of Housing and Urban Development (HUD) make any representations or warranties whatsoever in respect to the mortgage loan or any housing constructed with City or HUD assistance. 19. ENTIRE AGREEMENT: AMENDMENTS The provisions set forth in this Agreement, and all Exhibits and attachments to this Agreement, constitute the entire and complete agreement of the parties hereto and supersede all prior written and oral agreements, understandings or representations related thereto. No amendment or modification of this Agreement, and no waiver of any provision of this Agreement, shall be binding unless made in writing and executed by the duly authorized officers of both the Subrecipient and City. 20. SIGNATURES The persons signing this Agreement on behalf of Subrecipient represent and warrant that such persons and Subrecipient have the requisite power and authority to enter into, execute and deliver this Agreement and that this Agreement is a valid and legally binding obligation of Subrecipient enforceable against Subrecipient in accordance with its terms. IN WITNESS WHEREOF, Subrecipient and the City have executed this Agreement as of the date first above written and under the laws of the State of Colorado. CITY OF PUEBLO, ATTEST: A Municipal Corporate B City erk President of City Council [SEAL] HABITAT FOR HUMANITY OF PUEBLO, INC., ATTEST: a Col Non - Profit Corporafo B GUAc�-vv Title: Name: n'1 _ 14dcr is o Title: Press - i 9)oard irP A recfcrs [SEAL] Approved as to form: City Attorne�/ ME