Loading...
HomeMy WebLinkAbout7323RESOLUTION NO. 7323 A RESOLUTION APPROVING A GRANT FOR $858,000 TO THE U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD) FOR HOME INVESTMENT PARTNERSHIPS ACT (HOME) FUNDING, AUTHORIZING THE CITY MANAGER TO SUBMIT SAME AND TO ACCEPT FUNDING ON BEHALF OF THE CITY OF PUEBLO AND PUEBLO COUNTY AND DESIGNATING THE CITY MANAGER AS THE CITY'S REPRESENTATIVE TO ACT IN CONNECTION WITH THE APPLICATION. BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, COLORADO, that: SECTION 1. The Application to the U.S. Department of Housing and Urban Development for funding under the HOME Investment Partnership Act (HOME), a copy of which is attached hereto and made a part hereof by reference, including all the representations and assurances contained therein, is approved for submission to HUD as required and the City Manager of the City of Pueblo is hereby authorized to execute and submit said Application on behalf of the City of Pueblo acting as the lead government agency under the HOME program. The City Manager is hereby designated as the City's representative to act in connection with the Application, to provide such additional information as may be required by HUD, and if the Application is approved, to accept on behalf of the City of Pueblo said HOME Investment Partnership Act funds subject to the Consortium Agreement passed by City Council on September 9, 1991. INTRODUCED: March 28 , 1994 By SAMUEL CORSENTINO Councilperson ATTEST: APP OVED: -al 'id City Clerk P ident of the City A nnI In ATtn►t enn OMI Appr No. 0 3" _ mj PI r r {.1 v h 1 1 V n r V rTi FEDERAL ASSISTANCE 2. DATE SUBMITTED Aptyrci;u anlUrer March 15,1994 I. TYPE OF SUBMISSIOIk Appriutron Aaapfs►Kation I. DATE RECEIVED BY STATE N/A State Applical*n IdenMier MC Construction ❑ Construction ' 4. DATE RECEIVED By FEDERAL AGENCY Federal Idenbfier ❑ Non-Construction ❑ Non - Construction S. APPLICANT INFOAMAT1pN Legal Name. City of Pueblo, Colorado OrOarrr$tional Unit: Address (give city, county. state. cad rip code): Name and telephone number of the person to be contacted on mailers invofvrrig #1 City Hall Place this application (give Dina coda) Pueblo, CO 81003 Mr. Tony Berumen, Director Department of Housing & Com. Development (719) 584 -0830 S. EMPLOYER IDENTIFICATION NUMBER tEINI: 8 4 "60 0 0 6 1 5 7. TYPE OF APPLICANT: (enter appeopnarai Inner in box) A. State H Mtdeo.ndent School Dist. B County I: State Controlled Institution of Higher Learning C. Municrpal J Private Unrversity ► TYPE OF APPLICATION: D. Township K Indian Tribe ❑ New ❑ Continuation ❑ Revision E. Interstate • L. Individual It Revision. enter appropriate Inflects) box(es): ❑ ❑ F Intermunicipd M Profit Organization in G Special District N. Other (Specify) A Increase Award B Decrease Award C Increase Duration D Decrease Duration Other (specily): 1. NAME OF FEDERAL AGENCY: Department of Housing And Urban Developmen (HUD) 14. CATALOG 09 FEDER L DOMESTIC 1 [ t 2 3 9 11. DESCRIPTIVE TITLE OF APPLICANTS PROJECT: e TtnE. Title II, Home Investment HOME: Housing Rehabilitation Assistance Partnership Act (HOME) for owner — occupied and rental households. Consortium of the City of Pueblo and the County of 12. AREAS AFFECTED BYPROJECT(Crhes. counties. states. eft.): Pueblo. Pueblo, Colorado 12. PROPOSED PROJECT: 14. CONGRESSIONAL DISTRICTS OF: Start Date Ending Date A. Applicant : b Protect 6/1/94 6/1/96 3rd Congressional Diotrict 3rd Congressional District 1S. ESTIMATED FUNDING: 1$. IS APPLICATION SUBJECT TO REVIEW BY STATE EXECUTIVE ORDER 12772 PROCESS? a. YES THIS PREAPPLICATIOWAPPLICATION WAS MADE AVAILABLE TO THE a Federal S 858,000-00 STATE EXECUTIVE ORDER 12772 PROCESS FOR REVIEW ON b Applicant _ .00 DATE c State = .00 b NO ® PROGRAM IS NOT COVERED BY ED 12372 d Local S .00 OR PROGRAM HAS NOT BEEN SELECTED BY STATE FOR REVIEW a Other S .00 I Program Income E .D0 17. 13 THE APPLICANT DELINOUENT ON ANY FEDERAL DE877 Yes H 'Yes.' attach an explanation C] Np g TOTAL S 858,000-00 Is. TO THE $EST OF MY KNOWLEDGE AND 611.191 ALL DATA IN THIS APPLICATION PREAPPLICATION ARE TRUE AND CORRECT. THE DOCUMENT WAS BEEN DULY AUTHORIZED By THE GOVERNING BODY OF TILE APPLICANT AND THE APPLICANT WALL COMPLY WITH THE ATTACHED ASSURANCES IF THE ASSISTANCE IS AWARDED a Typed Name of Authorized Representative b Tale c Telephone number Lewis A. Quigley City Manager (719)584 -0830 d Signature of Authorized Representative a Date Signed 3/15/94 Standard Form 474 IgEV J asi Prescribed W OMB Lac.rai A iOl OUTLINE I. EXECUTIVE SUMMARY A. Consortium CHAS Housing Strategy II. FORMS OF INVESTMENT III. HOME MATCHING REQUIREMENT BY CONSORTIUM IV. PROPOSED USE OF HOME FUNDS BY CONSORTIUM A. Guidelines for Resale V. HOME ALLOCATION OF MONIES VI. COMMUNITY HOUSING DEVELOPMENT ORGANIZATION VII. AFFIRMATIVE MARKETING & MINORITY AND WOMEN OWNED BUSINESSES VIII. OTHER CONSORTIUM HOME PROCEDURES IX. CONSORTIUM RECORD KEEPING X. APPENDICES A. Certifications B. Attachments 1 2 2 2 6 8 8 7 11 CITY OF PUEBLO AND PUEBLO COUNTY CONSORTIUM HOME PROGRAM DESCRIPTION I. EXECUTIVE SUMMARY The HOME formula allocation for the Consortium consisting of the City of Pueblo and Pueblo County local governments amounts to $858,000. Under a formal Consortium Agreement between the two participating governments, the City of Pueblo will receive $686,400 and Pueblo County $171,600 to establish an owner occupied rehabilitation program in areas outside the Pueblo city limits. Non - profit participation in the amount of $128,700 will allow Neighborhood Housing Services (NHS) and the Bradford Neighborhood Association to continue acting as the local Community Housing Development Organization (CHDO). Efforts will be made to involve other CHDO's. In response to the CHAS identification of housing needs and a housing delivery approach that would involve the two local governments without the administrative difficulty involved in dealing with different entities, the City of Pueblo will act as lead agency for HUD. Each jurisdiction's proposed use of HOME funds will be defined separately under Section IV of this program description. Housing delivery services will be within each jurisdiction's geographic boundary. The Pueblo County local government and Neighborhood Housing Services HOME program for 1994 will in many ways continue with the housing programs defined in the 1993 HOME program description. Under the Consortium approach, The City of Pueblo will act as the lead participant working directly with the Pueblo County and Neighborhood Housing Services. The City will establish a HOME Investment Trust Fund and do all project set -up under the Cash Management Information (C \MI) System used by HUD to process each project in compliance with the HOME requirements. The City of Pueblo will then provide each agency with monthly project status reports. The Consortium will offer several HOME program alternatives for persons of low and moderate income households identified in the CHAS as needing housing assistance. Each jurisdiction has the goal of helping as many of the Consortium loan applicants as possible within its boundaries and among different categories of housing need. Consortium CHAS Housing Strategy_ Section II of the current Comprehensive Housing Affordability Strategy (CHAS) specifies the following as housing priorities: 1993 HOME Program Description Revised 3/94 1 1. To endeavor to secure contracts with HUD to expand the supply of affordable rental units and new construction for very low -, low- and moderate - income households within the corporate limits of the City of Pueblo. 2. To encourage and support the rehabilitation of existing housing stock for very low -, low- and moderate - income households, principally for owner - occupants. 3. To increase and preserve homeownership through owner - occupied rehabilitation, energy conservation and first -time homebuyer programs to assist renter households become homeowner. 4. To increase and preserve housing opportunities for people with special needs and, wherever possible, help people maintain or achieve independent living. 5. To develop affordable migrant farm worker housing. II. .FORMS OF INVESTMENT The Consortium will use the following forms of assistance with as much utilization of the primary leveraging techniques so as not to invest anymore HOME funds in combination with other federal assistance that will be necessary to provide affordable housing: 1. Interest Reduced Loans 2. Deferred and low - interest loans 3. Non - interest Bearing and Interest Bearing Loans 4. Principal Reduction 5. Grants III. HOME MATCHING REQUIREMENTS BY CONSORTIUM For the Consortium, there will be no matching requirement under the 1994 HOME formula allocation. The Consortium meets the two statutory distress criteria as a "severe fiscal distress" participating jurisdiction allowing a 100 percent match waiver for the Consortium. IV. PROPOSED USE OF HOME FUNDS BY CONSORTIUM PARTICIPANT The following proposed uses of HOME funds are essential to the implementation of the Consortium's approved CHAS for approving the supply, affordability and availability of decent, safe, sanitary housing. Neither the City of Pueblo nor the County propose to do tenant assistance with HOME funds but, the 1993 HOME Program Description Revised 3/94 2 Consortium would like to reserve the right to request such assistance later deemed necessary. City of Pueblo Interest Reduced Loans Method of Assistance: Moderate Rehabilitation of owner - occupied units Estimated Number of Units: 12 Rehabilitation of owner occupied dwellings up to $17,500. Target income group will be those households at 65 to 80% of median income. The City of Pueblo program will subsidize or buy down the lender's market interest rate to the desired housing debt standard of 30% of household income. An interest subsidy, as a direct cash grant to lower the effective higher market interest to the lower borrower can also be described as a discounting of a lower yielding loan to effect a market rate of interest. Interest rates will be targeted at three percent. Because the City will provide the present value of the difference between market rate and the three per -cent rate banks will find this arrangement attractive, allowing the private lender funds to be used at an approximate ratio of 3 to 1 HOME dollars to be used. With the monthly payments to be received, the City will seek to recapture its HOME investment by having the lender deposit these funds into a HOME Investment Trust Fund revolving account that will meet the requirements of the HOME match for future legislative purposes. Countv and Citv of Pueblo Housina Rehabilitation Loans Method of Assistance: Moderate Rehabilitation of owner - occupied units Estimated County Number of Units: it to 15 Estimated City of Pueblo Number of Units: 5 to 8 Loans for rehabilitation of owner occupied dwellings up to $17,000 at 15 years both deferred and low interest rate loans. Each jurisdiction will concentrate in their respective geographic areas. The Pueblo County area will include rural areas outside the corporate limits of the City of Pueblo. Target income groups will be below 80% of medium income with special payback provisions for households at 50% medium income. These eligible properties will meet, after rehabilitation is complete, the City of Pueblo Housing Code. Applicants will be allowed to borrow funds based on analysis of some payback ability. HOME funds will first be used to correct City of Pueblo Housing Code violations addressing health and safety. The basic mechanical systems consisting of roofs, plumbing (water and sewer), electrical and 1993 HOME Program Description Revised 3/94 3 structural will be brought up to housing code before other improvements are made to the property. City of Pueblo HOME Substantial Rehabilitation Program Method of Assistance: Rehabilitation of owner - occupied units Estimated Number of Units: 5 to 8 This program will be similar to the HUD 312 Program which will allow more intensive rehabilitation for households. Owner - occupants of one- to four -unit properties who have incomes below 80 percent of Pueblo's median income will be eligible for loan limits as high as $33,500 at 3% interest rates with 20 year terms. Emphasis will be for larger families greater than four or more. Non - housing code improvements cannot exceed 40% of the total loan amount. The most recent assessed value of the property will be determined to meet the loan -to -value ratio requirements. These loans will be targeted toward borrowers likely to repay and where there is sufficient value in the property, in case the borrower defaults. Emphasis will be for those loans to applicants in riskier neighborhoods at more attractive rates than conventional rehabilitation loans. The applicants total housing expense (PITI) including any HOME loan cannot exceed 30% of gross monthly income. Total debt cannot exceed 45% of gross monthly income. City of Pueblo HOME Rental Rehabilitation Funds Method of Assistance: New Construction for non - profits and Rehab of investor owned units Estimated Number of Units: City of Pueblo 10 Potential income from the property will be analyzed. HOME funds for multifamily loans will be similar to guidelines under the previous HUD funded Rental Rehabilitation Program. The City of Pueblo will follow financial techniques to fit the best deal. All options will be considered such as assumable, forgivable, deferred payment loan or grant versus a below market interest rate loan coupled with a conventional loan or other private investment. , Project financial feasibility and soundness of projects also an owner's investment and return will be analyzed. For Home- assisted rental housing not less than 90% of HOME funds will be invested in units occupied by families whose annual income do not exceed 60% of median income for Pueblo county. The City of Pueblo will select low income neighborhoods with priority for rehab of vacant units. New construction will take place on units deemed infeasible to rehabilitate and meet neighborhood target criteria in regards to number of abandoned homes, blight and lack of private investment 1993 HOME Program Description Revised 3/94 4 in the area. Target units for rehab will be larger families units with two or more bedrooms. Minimum rehabilitation costs must total $1,000 per unit in each project. Rehabilitation standards will be the City of Pueblo Housing Code with all units after rehabilitation meeting the Section 8 HQS. Substantial rehabilitation projects will meet the cost effective energy conservation and effectiveness standards in 24 CFR Part 39. All new construction projects must meet the Model Energy Code published by the Council of American Building Officials. Eligible projects will be carefully screened for those receiving other federal assistance except tenant based Section 8 Existing Housing Program under 24 CFR Part 882 or the Housing Voucher Program under 24 CFR 887, Subparts A and B. HOME funds will provide preferred financing for: 1. Purchase or Refinance Existing Vacant Multi - Family Units 2. Substantial Rehabilitation of Existing Apartments 3. New Construction and single residential homes acquisition and rehabilitation for lower income families City of Pueblo HOME First Time Homeownership Assistance Loans Method of Assistance: Acquisition and Rehabilitation of single residential units for first -time homeowners. Estimated Number of Units: City of Pueblo 6 - 10 The City of Pueblo will use HOME fund to provide homeownership opportunities by techniques such as downpayment assistance, sales price reduction, below market interest rate loans and closing cost assistance. Loans will be secured by promissory notes and second and third mortgage. These will be primarily bridge loans for allowing homeownership financing to take place. The proposed type of homeownership that potential homebuyers will acquire under this program will include both fee simple and lease /purchase arrangements that allow a person to acquire and /or rehabilitate a property that will be leased to a potential homebuyer. First mortgage financing for the Homeownership program will come from the Colorado Housing Finance Authority (CHFA) and other local mortgage lenders utilizing FHA mortgage insurance. Under a now existing City of Pueblo homeownership program a private lender using CHFA low interest bond funds makes a first mortgage FHA loan to a qualified borrower at 29% of gross income for principal, interest, taxes and insurance. The City of Pueblo places a temporarily deferred low- interest loan behind the Lender's loan for the remainder of the rehabilitation cost. This program allows the borrower to purchase an older Pueblo home in 1993 HOME Program Description Revised 3/94 5 addition to having funds to rehabilitation the property at an affordable monthly mortgage payment. All homes after rehab must meet the City of Pueblo Housing code. The lease /purchase arrangement will allow homebuyers to defer monthly payments on second and third gap financing loans for a two -year period before the option to purchase the home is exercised. In addition, under the lease option system, homeownership counseling will be.given the family during the two year period. In addition to the above, HOME funds will attempt to be used to provide for acquisition downpayment assistance for conventional financing of homeownership by low- and moderate income families. Under a typical downpayment assistance loan program, borrowers provide a l0% downpayment, the City provides a lot interest - accrued, recertified, deferred loan and a conventional loan will provide variable or fixed rate financing for the remaining 80 %. The City of Pueblo may recertify borrowers every year and if their income has increased by a specific amount, the deferred loan converts to an amortizing loan. Section 203 (K) Acctuisition /Rehabilitation Loans and CHFA The City of Pueblo currently uses under it's Pueblo Urban Homestead Program, the FHA Section 203 (K) Program. Loans are designed to facilitate the purchase and rehabilitation of vacated or boarded -up older Pueblo homes that are feasible to rehabilitation and provides renter households opportunities to obtain homeownership. Section 203 (k) loans carry 30 year terms and are currently being loan by (CHFA) at 7.8% interest rate. Section 203 (K) can frequently provide less costly private funds which the City may more efficiently leverage. Section 203 (K) provides an additional resource with which the City can leverage HOME funds with acquisition needs. The Home mortgage for assistance will be equal to the term of the HUD - insured mortgage. Guidelines for Resale Projects assisted under the Homeownership program will be required to adhere to the resale guidelines specified by 24 CFR 92.254. To allow the resale of properties and a fair return to the initial owner the City of Pueblo will adopt the following provisions: 1. The housing must remain affordable to low income homebuyers for a period of 15 years from the date of initial purchase. If a subsequent buyer of a first time homebuyer unit is assisted with HOME funds in order to make the unit affordable in accordance with the resale restrictions, the period of affordability will begin anew. 1993 HOME Program Description Revised 3/94 6 2. Since new construction is at this time anticipated with the use of HOME funds the City of Pueblo will assure affordability with a 20 year period. If the house is sold prior to the end of the 20 year compliance period, the housing must be offered to a low income family (80 % of median income) that will use the property as its principal residence; and it must be offered at a price that provides the initial owner with a fair return on investment, including any improvements, but also remains within a price range which is affordable to a subsequent low income purchaser whose monthly payments of principal, interest, taxes and insurance do not exceed 30 percent of the gross income of a family with an income that is equal to 75 percent of median income for the Pueblo area, as determined by HUD with adjustments for smaller and larger families. 3. To eliminate future uncertainty for the first time homebuyer as much as possible the City of Pueblo will clarify up -front what equity the owner can recapture if a sale occurs within the resale restriction period. The city will use a shared appreciation resale provision whereby the owner's fair return will be based on the following formula: Downpayment plus monthly payments applied toward principal and cost of major improvements which increased the value of the property. This amount when added to the homeowners investment represents his share of the appreciation of the value of the property. The City of Pueblo's subsidy and any appreciation will be reduced if necessary to be affordable for the subsequent buyer. If the seller is unable to adhere to the above, the entire amount of subsidy attributable to the site in question is repayable upon sale. However, an alternative resale restriction requires the recapture of the HOME subsidy (in whole or in part) in those instances where on the subsequent purchase, the property is not sold to a low- income homebuyer. Enforcement provisions for principal residence and HOME resale restrictions for subsequent low income buyers will be enforced through deed restrictions. Legal documents will require the homebuyer to retain the purchased home as their principal residence and convey the property to low income subsequent purchasers with affordable payments. The HOME subsidy for the initial purchaser will become due on sale with the full or partial repayment subject to assurance that these resale provisions are met. Upon foreclosure by a lender or other transfer in lieu of foreclosure, the affordability period shall be suspended if the foreclosure by a lender or other transfer in lieu of foreclosure 1993 HOME Program Description Revised 3/94 7 recognizes any contractual or legal rights of public agencies, nonprofit sponsors or others to take action that would avoid termination of low- income affordability. V. HOME ALLOCATION OF MONIES Table A below summarizes the proposed use of HOME funds by the Consortium: Total Home Rental $ Owner $ New Construction $ 80,000 $100,000 Substantial Rehabilitation $ 0 $ 140,000 Other Rehab $ 0 $378,000 Acquisition $ 80,000 $ 80,000 Tenant Assistance $ 0 $ 0 ,F- TOTAL $ 160,000 $698,000 VI. COMMUNITY HOUSING DEVELOPMENT ORGANIZATION AND HOME The City of Pueblo has requested and will enter into a formal agreement with the two local non - profit housing agencies. Neighborhood Housing Services will address two primary needs of their targeted areas: 1. Increase investment in housing owned, developed or sponsored by NHS and thereby increase the amount of affordable housing to the low- income neighborhood served by NHS. 2. In response to the decline in the housing stock conditions in NHS area the City of Pueblo will contribute $100,000 of HOME funds for their area of neighborhood revitalization. 3. The Bradford Neighborhood Association will work closely with the City to develop the capacity to become a second CHDO. Activities to be carried out by NHS with HOME funds It is the intent of NHS to provide, with the use of $100,000 HOME funds, the purchase and rehabilitation of 5 vacant single family homes in the Northside /Downtown neighborhood of Pueblo. Approximately $80,000 of the HOME funds will provide downpayment 1993 HOME Program Description Revised 3/94 8 assistance to purchase and rehabilitate a vacant and boarded up ten unit multi - family dwelling to be used for low and moderate income clients with the assistance of the Pueblo Housing Authority. Total Home Rental S Owner New Construction $ 0 $ 0 Substantial Rehabilitation $ 0 $ 20,000 Other Rehab $ 80,000 $ 0 Acquisition Tenant Assistance $ 0 1 $ 0 Grand Total IS 80,000 20 000 VII. AFFIRMATIVE MARKETING AND MINORITY AND WOMEN OWNED BUSINESSES Outreach to Minority and Women Business The City of Pueblo through the procurement policies followed by the Department of Purchasing strongly supports small minority and women business opportunities. Some of the affirmative steps the City of Pueblo takes are: To encourage minority business participation in the bidding process, the department actively subscribes to publications such as the directory of " Minority and Women Advertisers and " Colorado Women's News ". These procedures assure such businesses have an equal opportunity to compete and obtain contracts. Encourage General Contractors on larger construction jobs to divide total contract requirements into small tasks or quantities or subcontract work to minority businesses and women's with the City of Pueblo projects. Requires no formal performance and payment requirements on smaller housing rehabilitation projects less than $10,000 except for general business insurance and compliance with local license requirements, thereby assisting smaller businesses. Fair Housing Choice The City of Pueblo, Pueblo County and NHS, are all members of the Fair Housing Task Force Committee. The Fair Housing Task Force conducted an analysis of fair housing impediments in July, 1993 1993 HOME Program Description Revised 3/94 9 and under its Fair Housing Strategies Plan took action designed to address the conditions identified as limiting fair housing choice. The Proposed Use of Home funds as defined in this Program Description will assist with the implementation of this impediment study. In order to attract eligible persons from all racial, ethnic and gender groups to the available housing the Consortium will make good faith efforts by: Using the Fair Housing Task Force network brochures to inform the public, in churches, employment centers and other housing counseling agencies. Using the EHO logo type or slogan in press releases and written brochures that advertise the programs. Organizing periodic meetings with private lenders about the benefits of identifying affirmative loan targeting to low - income residents and neighborhoods. Using housing advocates agencies such as HOPE ALIVE, SRDA, Family Counseling Agency and other community housing advocates. Periodically assessing the affirmative marketing efforts following advertisements. Affirmative Marketing Procedures The Consortium will take the following actions to provide information and otherwise attract eligible persons from all racial, ethnic and gender groups in the housing market area to the housing which is assisted by the HOME Program funding: All correspondence, notices and advertisements related to the HOME funds will contain either the Equal Housing Opportunity logotype or slogan. Participants in the HOME Program will be required to use affirmative fair housing marketing practices in soliciting renters or buyers, determining their eligibility and concluding all transactions. Any HOME assisted housing must comply with the following procedures for the required compliance period depending on which program is utilized. 1. Owner's advertising of vacant units must include the equal housing opportunity logo or statement. Advertising media may include newspapers, radio, television, brochures, leaflets, or may involve simply a sign in a window. 2. The owner will be required to solicit applications for vacant units from persons in the housing market who are least likely to 1993 HOME Program Description Revised 3/94 10 apply for the HOME assisted housing without benefit of special outreach efforts. In general, persons who are not of the race /ethnicity of the residents of the neighborhood in which the rehabilitated building is located shall be considered those least likely to apply. The owner may wish to use community organizations, places of worship, employment centers, fair housing groups, housing counseling agencies, social service centers, or medical service centers as resources for this outreach. 3. The owner must maintain a file containing all marketing efforts (i.e. copies of newspaper ads, memos of phone calls, copies of letters, etc.) and the records to assess the results of these efforts are to be available for inspection by the City of Pueblo. 4. The owner shall maintain a listing of all tenants residing in each unit at the time of application submittal through the end of the compliance period. The City of Pueblo will assess the affirmative marketing efforts of the owner by comparing predetermined occupancy goals to actual occupancy data that the owner is required to maintain. Outreach efforts on the part of the owner will also be evaluated by reviewing marketing efforts. The City of Pueblo will assess the efforts of the owners receiving HOME funds during the rent -up and marketing of the units by use of a compliance certification or personal monitoring visit to the project at least annually. Corrective actions shall include extensive outreach efforts to appropriate contacts to achieve the occupancy goals or other sanctions the City of Pueblo may deem necessary. Each unit of general local government that subgrants the administration of this program must adopt affirmative marketing procedures and requirements that meet the requirement in paragraphs (a) and (b) of 24 CFR 92.351. VIII. OTHER CONSORTIUM HOME PROCEDURES Other Loan Underwriting Criteria All HOME loans will be secured by promissory notes secured by deeds of trust. Subordination to no less than third position will be considered when appropriate. The City frequently receives loan packages in which a low- income borrower has a first or second mortgages lien that carries an exorbitant interest rate. 1993 HOME Program Description Revised 3/94 11 The City will analyze such bad loans and using non -HOME funds refinance such high interest rate mortgages. The borrower greatly benefits from reduced payments on the refinanced mortgage, the elimination of an high interest rates from their property and the consolidation of mortgage debt obligations, allowing needed home repairs to take place. IB. CONSORTIUM- RECORD KEEPING HOME project set -up procedures will be administered by the City of Pueblo for entering into HUD's Cash Management information System. The City of Pueblo will also track compliance with the 15 -day initial disbursement requirement. The City of Pueblo will provide full cycle reporting to participating other agencies involved in the HOME program to assure effective program administration. The City will monitor HUD's C /MI System which maintains a running account of funds for each project including the amount committed to specific projects. Monthly financial reports generated by the System will be passed on to Pueblo County and NHS. Staff of the City of Pueblo will process reservation and obligation of funds in accordance with the C /MI System. Pueblo County and NHS, in addition, will maintain files that summarize (i) each payee, (ii) date of payment, (iii) amount, (iv) account running balance and other funding sources for each HOME project. Upon either Pueblo County or Neighborhood Housing Services recordation of a notice of completion for the HOME funded project general record - keeping requirements in accordance with any Agreements drawn up between the agencies and HOME administrative requirements. Each agency will be required to prepare loan portfolio servicing on a monthly HOME deferred and amortized loans. The files will provide complete collection information and primary information regarding HOME funds. A loan servicing system will include late payment notices sent out at certain intervals. Appropriate tax reporting on interest paid by the borrower will be forwarded to the IRS on form 1098 for each borrower. In addition, each agency will provide loan payoff quotations, amortization schedules and recertifications of income eligibility for any loans by HOME borrowers. City Contracts Disk HONEPLAN Doc 1993 HOME Program Description Revised 3/94 12 ATTACHMENT C CERTIFICATIONS HOME PROGRAM DESCRIPTION In accordance with the Home Investment Partnerships Act and with 24 CFR 92.150 of the home Investment Partnership Program Rule, the participating jurisdiction certifies that: (a) Before committing any funds to a project, it will evaluate the project in accordance with the guidelines that it adopts for thin purpose and will not invest any more HOME funds in combination with other Federal assistance than is necessary to provide affordable housing; (b) If the participating jurisdiction is not on the list published under 24 CFR 92.51 and intends to do new construction to facilitate a neighborhood revitalization program; For each neighborhood revitalization program, 1. Rehabilitation is not the most cost - effective way to meet the participating jurisdictions need to expand the supply of affordable housing within the neighborhood and the participating jurisdictions housing needs, within the neighborhood, cannot be met through rehabilitation of the available housing stock; and 2. The program of new construction is needed to facilitate a neighborhood revitalization program that emphasizes rehabilitation of substandard housing for rental or homeownership opportunities by low- income and moderate - income families in an area designated by the jurisdiction; 3. The housing is to be located in a low- income neighborhood; 4. The housing is to be developed, owned, or sponsored by a community housing development organization or a public agency; and 5. The number of housing units to be constructed with HOME funds does not exceed 20 percent of the total number of housing units in the neighborhood revitalization program that are assisted with HOME funds; unless affordability, and availability of decent, safe, sanitary, and affordable housing. ( ®) The submission of the program description is authorized under State and local law (as applicable), and that it possesses the legal authority to carry out the Home Investment Partnerships (HOME) Program, in accordance with the HOME regulations; (f) It will comply with the acquisition and relocation requirements of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended, implementing regulations at 49 CFR part 24 and the requirements of 24 CFR 92.353; (g) It and State recipients, if applicable, will use HOME funds pursuant to its Comprehensive Housing Affordability Strategy (CHAS) approved by HUD and all requirements of 24 CFR Part 92; (h) It will or will continue to provide a drug -free workplace by: 1. Publishing a statement notifying employees that the unlawful manufacture, distribution, dispensing, possession, or use of a controlled substance is prohibited in the grantee's workplace and - specifying the actions that will be taken against employees for violation of such prohibition; 2. Establishing an ongoing drug -free awareness program to inform employees about - (a) The dangers of drug abuse in the workplace; (b) The participating jurisdiction's policy of maintaining a drug -free workplace; (c) 'Any available drug counseling, rehabilitation, and employee assistance programs; and (d) The penalties that may be imposed upon employees for drug abuse violations occurring in the workplace; 3. Making it a requirement that each employee to be engaged in the performance of the grant be given a copy of the statement required by paragraph (1); 4. Notifying the employee in the statement required by paragraph (1) that, as a condition of employment 3 Place of Performance (Street address, city, county, state, zip code) City of Pueblo, Department of Housing & Community Development #1 City Hall Place Pueblo, CO 81003 (i) To the best of its knowledge and belief: 1. No Federal appropriated funds have been paid or will be paid, by or on behalf of it, to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress in connection with the awarding of any Federal loan, the entering into of any cooperative agreement and the extension, continuation, renewal, amendment or modification of any Federal contract, grant, loan or cooperative agreement; 2. If any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress or an employee of a Member of Congress in connection with this Federal contract, grant, loan or cooperative agreement, it will complete and submit Standard Form - -LLL, "Disclosure Form to Report Lobbying" in accordance with its instructions; and 3. It will require that the language of paragraph (h) of this certification be included in the award documents for all subawards at all tiers (including subcontracts, subgrants, and contracts under grants, loans and cooperative agreements) and that all subrecipients shall certify and disclose accordingly. SIGNATURE March 15, 1994 DATE City Manager TITLE