HomeMy WebLinkAbout08344ORDINANCE NO. 8344
AN ORDINANCE APPROVING AND AUTHORIZING THE
EXECUTION OF A MEMORANDUM OF UNDERSTANDING
BETWEEN PUEBLO COUNTY AND THE CITY OF PUEBLO, A
MUNICIPAL CORPORATION CONCERNING MORTGAGE LOAN
ORIGINATION UNDER THE HOME CONSORTIUM
BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that:
SECTION 1.
The Memorandum of Understanding between the City of Pueblo, a Municipal
Corporation, and Pueblo County, relating to the origination of residential mortgage applications
for the County’s down payment and rehabilitation loans, is hereby approved substantially in the
form attached hereto, with such minor changes therein as shall be approved by the President of
City Council and the City Attorney, is hereby approved.
SECTION 2.
The President of City Council is hereby authorized to execute and deliver said
memorandum of understanding in the name of and on behalf of the City of Pueblo, a Municipal
Corporation, and the City Clerk shall affix the seal of the City thereto and attest the same.
INTRODUCED: April 11, 2011
BY: Larry Atencio
COUNCILPERSON
PASSED AND APPROVED: April 25, 2011 _
Background Paper for Proposed
ORDINANCE
# R-9
DATE: AGENDA ITEM
APRIL 11, 2011
DEPARTMENT:
HOUSING AND CITIZEN SERVICES
DIRECTOR – ADA RIVERA CLARK
TITLE
AN ORDINANCE APPROVING AND AUTHORIZING THE EXECUTION OF A MEMORANDUM
OF UNDERSTANDING BETWEEN PUEBLO COUNTY AND THE CITY OF PUEBLO, A
MUNICIPAL CORPORATION CONCERNING MORTGAGE LOAN ORIGINATION UNDER THE
HOME CONSORTIUM
ISSUE
Should the City Council approve the Memorandum of Understanding (MOU) with the County,
which provides for City Staff to underwrite loans for the County's HOME Programs for a set fee?
RECOMMENDATION
Approval of the Ordinance.
BACKGROUND
Under the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (“SAFE Act”) loan
originators are required to be licensed by the State of Colorado as a “Loan Originator.” The
County does not have licensed staff members, and wants to enter into an agreement with the
City to underwrite their HOME Program loans. The City’s Loan Coordinator is licensed by the
State. The County will reimburse the City for the Loan Coordinators time.
The City currently underwrites the County’s Downpayment Assistance Loans at no cost to the
County. This MOU will incorporate all the County Programs and will charge for those services.
It is anticipated that no more than 5 loans will be underwritten. Current staff can undertake the
work.
FINANCIAL IMPACT
The County is using HOME funds to pay for the City service and therefore these funds are
considered program income and have all the general restrictions of the HOME Program.
MEMORANDUM OF UNDERSTANDING
CONCERNING MORTGAGE LOAN ORIGINATION
UNDER THE HOME CONSORTIUM
THIS MEMORANDUM OF UNDERSTANDING is made and entered into this 25th day
of April , 2011, by and between the City of Pueblo, a Municipal Corporation, (hereinafter
referred to as the "City "), and Pueblo County, Colorado (hereinafter referred to as the "County "),
WITNESSETH.
WHEREAS, City and County (collectively, the "Parties ") have heretofore entered into a
Consortium Agreement effective October 1, 2009 (the "Agreement "), under which they formed and
continued a Consortium for the purpose of receiving certain federal funds and undertaking housing
assistance activities pursuant to the HOME Investment Partnerships Program ( "HOME Program ") as
a Participating Jurisdiction in accordance with the provisions of said Agreement; and
WHEREAS, the HOME Program allows the Parties to grant residential mortgage loans for
the purpose of down payment assistance and rehabilitation programs,
WHEREAS, the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ( "SAFE
Act ") requires that any individual employed at a non -profit or government agency who accepts
applications for residential mortgage loans, and who offers or negotiates terms of a residential
mortgage loan for compensation or gain, be licensed by the State of Colorado as a "Loan
Originator ", and
WHEREAS, the City has a licensed mortgage Loan Originator on staff underwriting its down
payment and rehabilitation loans, and
WHEREAS, the County does not employ a licensed Loan Originator; and
WHEREAS, the parties desire to set forth in this Memorandum their mutual understanding
concerning the origination of loans pursuant to the HOME Program guidelines
NOW, THEREFORE, in consideration of the mutual covenants and promises herein, the
parties agree as follows
1 The Parties agree that the City shall act as the Loan Originator for all down payment
assistance and rehabilitation loans issued pursuant to the HOME Program. As the Loan Originator,
the City will review any applications for down payment assistance and rehabilitation programs
provided to it by the County, collect information from the applicant, offer and negotiate terms for
loans, advise the applicant of the loan terms, prepare loan packages, and supervise the underwriting
process.
2 The County shall pay the City thirty -one dollars and seventy -four cents ($31 74) per
hour for this service. The City shall provide the County with periodic, but not more frequently than
monthly, invoices for payment. Thereafter, the County shall pay the City the amount due within
thirty (30) days of the date of the invoice. The City may discontinue this service if the County fails
to remit payment within sixty (60) days of the date of the invoice.
3 Each party shall retain authority over its respective housing programs and agencies
carrying out such programs on behalf of each party Each party shall set its own priorities for the use
of any grant monies received by the Consortium and shall retain the right to determine how those
funds attributed to each entity shall be expended in meeting those pnorrties.
4 This Memorandum shall become effective as a supplement to the Consortium
Agreement immediately upon approval by the respective govenung bodies of each of the Parties, and
shall terminate on December 31, 2011
5 Except as modified and supplemented by this Memorandum, all of the provisions set
forth in the Consortium Agreement shall continue in full force and effect and shall apply to the
operation -of -the Consortium.
-- IN WI -TNESS WHEREOF, the parties have entered into this Agreement the day and year first
above written.
ATTEST PUEBLO COUNTY, COLORADO
By. —. i By atP00117.--
Clerk to the Board- ,/ C irperson, Board of County Commissioners
ATTEST CITY OF PUEBLO,
A UNICI' AL CO' ' ORATION
I
B Y
City Cl President of thd City Council