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HomeMy WebLinkAboutMINUTES - 12172013 - C.46RECOMMENDATION(S): APPROVE and AUTHORIZE the Conservation and Development Director, or designee, to execute an agreement with the City of Walnut Creek for the County to administer the City’s Housing Rehabilitation Loan Program using City Housing Successor Agency funds for the period July 1, 2013 through June 30, 2014. FISCAL IMPACT: No fiscal impact to the County General Fund. All funds are City of Walnut Creek Housing Successor funds. BACKGROUND: The County Department of Conservation and Development, administers a housing rehabilitation loan program through its Neighborhood Preservation Program. The Program offers low interest loans to low-income households who own and occupy their home. The loan recipients qualify for loan assistance under County guidelines and U.S. Department of Housing and Urban Development (HUD) regulations. The City of Walnut Creek wishes to enter into a contract with the County to administer its Housing Rehabilitation APPROVE OTHER RECOMMENDATION OF CNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE Action of Board On: 12/17/2013 APPROVED AS RECOMMENDED OTHER Clerks Notes: VOTE OF SUPERVISORS AYE:John Gioia, District I Supervisor Candace Andersen, District II Supervisor Mary N. Piepho, District III Supervisor Karen Mitchoff, District IV Supervisor Federal D. Glover, District V Supervisor Contact: Kara Douglas, 674-7880 I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the Board of Supervisors on the date shown. ATTESTED: December 17, 2013 David Twa, County Administrator and Clerk of the Board of Supervisors By: Chris Heck, Deputy cc: C. 46 To:Board of Supervisors From:Catherine Kutsuris, Conservation and Development Director Date:December 17, 2013 Contra Costa County Subject:AGREEMENT BETWEEN CONTRA COSTA COUNTY AND THE CITY OF WALNUT CREEK FOR THE HOUSING REHABILITATION LOAN PROGRAM BACKGROUND: (CONT'D) Loan Program. The program offers loans to homeowners who can not obtain conventional financing. Funds are used to eliminate conditions that are detrimental to health and safety, and for repairs such as roofing, electrical, plumbing, mechanical, termite repairs, lead paint mitigation, disabled accessibility, interior and exterior painting and other necessary deferred maintenance repairs. The program promotes the stabilization and enhancement of older neighborhoods in order to encourage a sense of pride in the neighborhood. The City has Housing Successor funds from its former Redevelopment Agency and had approved and authorized the expenditure of $65,000 in Housing Successor funds for this program. The City will pay the County a minimum of $1,500 for each loan up to a maximum of 20 percent of the loan or grant amount as compensation for the services provided by the County to the City. CONSEQUENCE OF NEGATIVE ACTION: If the Board of Supervisors does not approve this contract, the program will be delayed or cancelled. CHILDREN'S IMPACT STATEMENT: None. ATTACHMENTS Walnut Creek Rehab Program Contract Walnut Creek Rehab Contract Exhibit A AGREEMENT BETWEEN CONTRA COSTA COUNTY, AND THE CITY OF WALNUT CREEK, ACTING IN ITS CAPACITY AS THE SUCCESSOR HOUSING ENTITY TO THE FORMER CITY OF WALNUT CREEK REDEVELOPMENT AGENCY FOR HOUSING REHABILITATION LOAN PROGRAM SERVICES Effective July 1, 2013, Contra Costa County (“County”), the City of Walnut Creek (“City”), acting in its capacity as the successor housing entity to the former City of Walnut Creek Redevelopment Agency, mutually agree and promise as follows: RECITALS A.The County administers a housing rehabilitation loan program through its Neighborhood Preservation Program. The purpose of the program is to offer low-interest and zero- interest loans to moderate-, low- and very-low income homeowners. B.If a homeowner meets the program’s eligibility requirements and sufficient funds exist, the homeowner receives a loan. The homeowner assumes the loan obligation under a promissory note, secured by a deed of trust, naming the City of Walnut Creek as lender. The City of Walnut Creek and Amerinational Community Services have an existing agreement. Under the agreement, Amerinational Community Services is responsible for servicing loans provided to homeowners under the program. C.After an eligible homeowner receives a loan, the homeowner enters into a contract with a contractor to complete the rehabilitation project. The County maintains a courtesy list of contractors that loan recipients may contact to complete home rehabilitation projects. D.The County’s housing rehabilitation loan program is funded by Community Development Block Grant funds, which are made available to the County under the Housing and Community Development Act of 1974, as amended (42 U.S.C. § 5301 et seq.). E.The City has housing rehabilitation loan program. The program is funded with successor housing funds. For fiscal year 2013-2014, the City has approved and authorized the expenditure of up to $65,000 in housing successor funds for the housing rehabilitation loan program. F.The City has verified and represented to the County that the successor housing funds may be used throughout the City of Walnut Creek for housing rehabilitation loans for qualifying homeowners. G.The City wish to have the County administer the City’s housing rehabilitation loan program. H.This Agreement authorizes the County to administer the portion of the housing rehabilitation loan program funded by successor housing funds. NOW, THEREFORE, the parties agree as follows: AGREEMENT 1.Term. Unless sooner terminated as provided in this Agreement, the term of this Agreement is from July 1, 2013 through June 30, 2014. 2.County Obligations. The County will provide the following services: A. Distribute loan application forms to interested property owners. B. Consult with property owners and provide information regarding rehabilitation program requirements. C. Application intake, review, and processing. D. Determine each applicant’s loan eligibility. For a property owner to be eligible for a rehabilitation loan, the property owner must meet the current low-income or moderate-income guidelines established by the U.S. Department of Housing and Urban Development. Eligibility will be based on these guidelines and on guidelines set forth in the Housing Rehabilitation Program policy of the Neighborhood Preservation Program. The policy is attached as Exhibit A and is incorporated into this Agreement. E. Conduct initial inspection of properties of eligible applicants and preparation of inspection reports. F. Assist eligible applicants with securing contractual services to undertake repair work, including preparing bid packages, noticing the availability of bid packages, and reviewing bids received. The County may assist the applicant in choosing a contractor from the County’s courtesy list of contractors or may assist the applicant in choosing a contractor who has a license from the State Contractor’s Board and a business license from the City of Walnut Creek. G. Assist eligible applicants with preparation of loan application documents and submittal of documents to financial institution. H. Prepare contract for execution by applicant and contractor. I. Perform periodic progress inspections, payment inspections and final inspection to determine whether rehabilitation work has been properly performed in accordance with the terms of the contract. J. If rehabilitation work has been properly performed in accordance with the terms of the contract, the County will, in conjunction with property owner, accept the work and authorize payments to contractor for work completed. K. If requested by the City, County Neighborhood Preservation Program staff will attend up to two City meetings to present information regarding the County’s provision of services under this Agreement. L.The County will annually report to the City on all rehabilitation loans made with City funds, including the name of borrower, address and parcel number, loan amount, the term of the loan, type of rehabilitation work completed under the loan, and program demographic information. This report shall be submitted to the City within 30 days after the end of the program year on June 30. M.Verification of contractor’s general liability, automobile liability and workers compensation prior to each project start date. Contractor’s general liability policy must list the County and the City as additional insured. 3. City and Obligations. The City will be responsible for the following: A. If the County determines an applicant is eligible for a loan, the County will submit a copy of the application to the City for the City’s review. The City will review the application to determine whether to approve the loan. If the City approves the loan, the City will authorize the County in writing to proceed with the processing of the loan application. If the City approves a loan, the County will be responsible for preparing the loan documents and contracts for the homeowner, where the homeowner assumes the loan obligation under a promissory note, secured by a deed of trust, naming the City as lender. B. If a homeowner and contractor execute a contract for rehabilitation work, the County will notify the City of the contract amount and the City will provide that amount to the County for payment to the contractor. Upon receipt of funds from the City, the County will make payments to the contractor in accordance with the contract terms, provided the rehabilitation work has been properly performed in accordance with the terms of the contract. C. The City will design, print and distribute all promotional literature relating to the program. The City will pay for all printing and other costs associated with the promotional literature. The City will advertise the program in city-published newsletters and similar publications, and will bear the cost of doing so. D. The City Community Development Department, Building Division, will be responsible for the processing of plans, issuing all necessary permits, periodic and final site and building inspections, and issuing any final occupancy permits for any rehabilitation project. Rehabilitation projects must meet the City’s building codes. The City Community Development Department, Building Division, will be responsible for determining whether a rehabilitation project meets the City’s building codes and for taking any code enforcement action it deems necessary. E. The City will be responsible for complying with any reporting requirements that may be required by applicable federal and state housing laws and community development laws. F.The City will be responsible for receiving loan repayments from the homeowner. The City will be responsible for enforcement of the payment obligation by the homeowner up to and including foreclosure on the house. The City will be responsible for collection actions on delinquent loans. 4.Compensation. The City will pay the County approximately $11,000 as compensation for the services provided by the County to the City under this Agreement. This amount includes all administrative and technical services provided by the County, including the Rehabilitation Specialist’s salary, administrative oversight, clerical assistance, and overhead costs. 5.Records. A. It is understood that periodic review of the County's work under this Agreement may be necessary and the right to do so review is reserved by the City. The City will have access to any books, documents, papers and records of the County that are directly pertinent to the work performed under this Agreement, except for confidential attorney/client materials. If required by applicable federal and state housing laws or community development laws, the County agrees to have an annual audit of activities provided to the City under this Agreement. B.The County shall retain all records relating to this Agreement for a period of three years from the termination of this Agreement, except that all loan records shall be retained for a period of three years after the final loan repayment. 6.Termination. This Agreement may be terminated by the County, or the City, upon 90 days written notice. If the City terminates this Agreement, the City shall pay to the County all payments due, or previously due, at the time of termination. 7. Amendments. Any amendments to this Agreement must be in writing and signed by the parties. 8.Assignments. This Agreement is not assignable by the County in whole or in part without the prior written consent of the City. 9.Indemnification. The City agree to indemnify and hold harmless the County and its officers and employees for the City’s share of any and all claims, costs and liability, including attorneys fees, for any damage, injury or death of or to any person or the property of any person arising out of the willful misconduct or the negligent acts, errors or omissions of the City in the City’s performance under this agreement. The County agrees to indemnify and hold harmless the City and its officers and employees for the County’s share of any and all claims, costs and liability, including attorneys fees, for any damage, injury or death of or to any person or the property of any person arising out of the willful misconduct or the negligent acts, errors or omissions of the County in the County’s performance under this agreement. 10.Insurance. The City understand and agrees that the County is self-insured for its workers compensation and general liability exposures and agrees to extend the benefits of this protection to the City. 11. Third Parties. Nothing in this Agreement is intended, nor shall it be construed, to create rights inuring to the benefit of third parties. 12. Remedies. The sole remedy for violation of this Agreement is the specific performance of this Agreement. The County and City waive their respective rights to trial by jury of any claim or cause of action arising out of this Agreement. The County and City will have no liability for damages to one another or to any person or entity resulting from any violation of this Agreement. 13.Notice. All correspondence regarding this Agreement, including invoices, payments, and notices, shall be delivered by deposit in the United States mail, postage prepaid, and shall be directed to the following persons at the following addresses: COUNTY:Catherine O. Kutsuris, Director Contra Costa County Department of Conservation & Development 30 Muir Road Martinez, CA 94553 CITY Laura Simpson, Housing Division Manager City of Walnut Creek P.O. Box 8039 Walnut Creek, CA 94596 14. Construction. The section headings and captions of this Agreement are, and the arrangement of this instrument is, for the sole convenience of the parties to this Agreement. The section headings, captions and arrangement of this instrument do not in any way affect, limit, amplify or modify the terms and provisions of this Agreement. This Agreement shall not be construed as if it had been prepared by one of the parties, but rather as if both parties have prepared it. The parties to this Agreement and their counsel have read and reviewed this Agreement and agree that any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not apply to the interpretation of this Agreement. The Recitals are, and shall be enforceable as, a part of this Agreement. 15. Severability. If any term or provision of this Agreement is, to any extent, held invalid or unenforceable, the remainder of this Agreement shall not be affected. 16. Authorizations Obtained. The person executing this Agreement on behalf of the City represents that he or she has the requisite legal authority to enter into this Agreement on behalf of the City and to bind the City to the terms of this Agreement. The person executing this Agreement on behalf of the County represents that he or she has the requisite legal authority to enter into this Agreement on behalf of the County and to bind the County to the terms of this Agreement. 17.Entire Agreement. This Agreement contains the entire agreement between the parties and all prior understandings or agreements, oral or written, regarding this matter are superseded. CONTRA COSTA COUNTY CITY OF WALNUT CREEK By: ____________________________By: __________________________ Catherine O. Kutsuris, Director Contra Costa County City Manager Dept. of Conservation & Development Building Inspection Division APPROVED AS TO FORM:APPROVED AS TO FORM: Sharon Anderson, County Counsel By: _____________________________By: __________________________ City Attorney City of Walnut Creek VERIFICATION OF AVAILABILITY OF FUNDS By: City of Walnut Creek Finance Department 1 City of Walnut Creek Home Rehabilitation Loan and Emergency Grant Program Policies and Guidelines I.INTRODUCTION A.This document sets forth policies for owner-occupied residential rehabilitation financial assistance in the form of low loans, and grants, for the City of Walnut Creek’s Home Rehabilitation Loan and Emergency Grant (Home Rehab) Program. B.The program is available throughout incorporated limits of the City of Walnut Creek. II.OBJECTIVES AND PRIORITIES A.Primary Objective The primary objective of the Walnut Creek Home Rehab program is to provide low interest loans and emergency grants to low- and moderate-income Walnut Creek homeowners for the purpose of improving their homes. Consistent with CDBG provisions, the program maintains viable communities by providing decent housing and a suitable living environment in the community, principally for persons of low- and moderate-income. B.Specific Objectives 1.Eliminate conditions that are detrimental to health, safety and public welfare by rehabilitating housing that is in need of safety repairs, accessibility enhancements, and building code compliance repairs. 2.Stabilize and enhance older neighborhoods to encourage future investment from the private sector and from other public funds and programs. 3.Encourage resource conservation by funding energy efficiency upgrades. To attain these objectives, the City has developed a financial assistance program consisting of low-interest loans and grants. The loans and grants must be used to rehabilitate owner-occupied homes. Eligibility for loans is based on household income, ability to service an additional monthly housing payment, and home equity. Grants are limited to emergency repair work. As a condition of receiving a loan or grant, a homeowner must agree to allow the County to enter the premises and inspect the premises to determine whether the rehabilitation work complies with building, housing and safety codes. Once a homeowner receives a loanor grant commitment, the homeowner enters into a contract with an independent contractor to complete the rehabilitation project. The City of Walnut Creek and the County Neighborhood Preservation Program is not a party to these contracts. 2 C.Priorities for Award of Loans and Grants It is the intent of this program that each applicant household first be evaluated for eligibility under the loan element, and second for a grant. The program intends to maximize the use of loans in order to establish a revolving fund for future program years. The origination of a combination interest bearing loanand grant is permissive under these policies. In all cases, if the household qualifiesfor a conventional market rate loan, it would not be eligible for either a loan or grant. Applications will be evaluated and processed as received, based on the eligibility criteria and requirements stated in the following sections of these guidelines. The evaluation will consist of an initial determination of the eligibility of the applicant followed by a determination of the needed repairs of the structure. Financial assistance will be awarded to applicants in the order in which their complete application materials are compiled for eligibility determination. III.GENERAL PROPERTY REQUIREMENTS AND APPLICANT ELIGIBLITY A.General Property Requirements Owner-occupied single family residences and condominiums will be eligible for rehabilitation loan or grant assistance, if the property 1.In need of repairs to: a) eliminate conditions that are detrimental to health, safety and public welfare; b) enhance accessibility; c) comply with building code; and d) improve energy efficiency. 2.has no conditions that cannot be mitigated pursuant to the National Environment Policy Act (24 CFR part 58) and Section 202(a) of the Flood Disaster Protection Act of 1973, B.Applicant Eligibility An eligible applicant is one who 1.is an owner-occupant of a single-family home or condominium inneed of the repairs listed in Section IV.B, 2.is a member of a household with a low (up to 80% area median income) or moderate income (between 80 and 120% AMI), depending on the funding source (CDBG up to 80% AMI) and type of assistance (grants are restricted to 80% and below). IV.ELIGIBLE IMPROVEMENTS Work and items of repair eligible under the program are to be completed as available funds allow, in the following order of priority: 3 A.To make repairs and improvements necessary to the structure to correct health and safety hazards; B.To make other repairs and improvements as necessary, including the following: 1.Property maintenance; 2.Energy efficiency; 3.Removal or architectural barriers for the disabled; 4.physical modifications designed to improve the mobility of handicapped or elderly persons; 5.improvements to conform to code standards applicable to existing residential structure to ensure safe, decent, and sanitary housing; 6.Other common repairs including (but not limited to) new roofs and gutters, insulation, central heating, kitchen and bath remodels, electrical and plumbing upgrades, painting, ramps, grab bars. V.REHABILITATION LOAN AMOUNTS, TERM, AND SECURITY A.Loan Amounts 1.The maximum amount for a rehabilitation loan shall not exceed $60,000 2.The maximum grant shall not exceed $10,000 3.The rehabilitation loan plus existing indebtedness against the property shall not exceed 85 percent of the appraised after-improvement value of the property at the time the loan is approved. B.Interest Rates The rehabilitation loans are amortized loans subject to 3% simple interest. C.Security Requirements Loans must be secured by a Deed of Trust, which secures the Promissory Note. D.Loan Terms 1.Loans may be pre-paid in part or in whole at any time and without any penalty. 2.The term is 20 years. 4 3.Loans are due and payable upon sale or transfer of the property. 4.Transfers that may not require repayment (with City approval) of the loan include the following: a.transfer to an existing spouse or domestic partner who is also an obligor under the note, b.transfer to a spouse or domestic partner where the spouse or domestic partner becomes the co-owner of the Property, c.transfer between spouses as part of a marriage dissolution proceeding, d.transfer to an existing spouse, domestic partner, or child of borrower by devise or inheritance following the death of borrower, or e.transfer by borrower into an inter vivos trust in which borrower is the beneficiary VI.HOUSING REHABILITATION and LEAD-BASED PAINT HAZARD CONTROL GRANTS A.Introduction Rehabilitation grants will be provided only to low-income households (80% and below) who do not qualify for a loan due to insufficient equity in their home . Repairs funded by grants are limited to correcting items that pose urgent health and safety threats. Grants may not be used for general repairs or improvements. C.Grant Amounts The maximum rehabilitation grant amount is $10,000 VII.ADMINISTRATION Implementation and administration of the Walnut Creek Home Rehabilitation Loan Program is the responsibility of the Contra Costa County Neighborhood Preservation Program 5 2013 Income Limits Household Size 120% of AMI 80% of AMI 1 Person $ 78,550 $ 45,750 2 Person $ 89,750 $ 52,300 3 Person $ 101,000 $ 58,850 4 Person $ 112,200 $ 70,600 5 Person $ 121,200 $ 70,600 6 Person $ 130,150 $ 75,850 7 Person $ 139,150 $ 81,050 8 Person $ 148,100 $ 86,300