HomeMy WebLinkAboutR-20-26 CDBG FY20/25 Housing Assistance PlanRESOLUTION NO. R-20-26
A RESOLUTION OF THE CITY OF SEBASTIAN, FLORIDA,
APPROVING THE COMMUNITY DEVELOPMENT BLOCK GRANT
(CDBG) HOUSING ASSISTANCE PLAN & PROCEDURES (HAPP)
FISCAL YEARS 2020 — 2025; AND AUTHORIZING THE CITY
MANAGER TO EXECUTE AND TRANSMIT ALL DOCUMENTS TO
THE U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT;
PROVIDING FOR CONFLICT; PROVIDING FOR SCRIVENER'S
ERRORS; PROVIDING FOR AN EFFECTIVE DATE.
WHEREAS, the City of Sebastian has prepared the Community Development Block Grant
(CDBG) Housing Assistance Plan & Procedures (HAPP) pursuant to all requirements of the U.S.
Department of Housing and Urban Development; and
WHEREAS, the Housing Assistance Plan & Procedures (HAPP) was made available for
review and comments on the City web site prior to the adoption by City Council; and
WHEREAS, the City of Sebastian conducted a public hearing on October 14, 2020, for
citizen review and comment; and
WHEREAS, proposed CDBG projects and activities are consistent with the U.S. Housing
and Urban Development's National Objectives.
NOW THEREFORE, THE CITY OF SEBASTIAN HEREBY DETERMINES, FINDS,
AND RESOLVES AS FOLLOWS:
Sectionl• (1) Approves the Housing Assistance Plan & Procedures for FFY 2020-2025; and (2)
authorizes the City Manager to execute and transmit all required documents to the U.S. Department of
Housing and Urban Development.
Section 2. CONFLICT. All resolutions or parts of resolutions in conflict herewith are
hereby repeated.
Section 3. SCRIVENER'S ERRORS. Sections of this resolution may be renumbered or re -
lettered and corrections of typographical errors which do not affect the intent may be authorized by the
City Manager, or the City Manager's designee, without need of further action of the City Council by filing
a corrected copy of same with the City Clerk.
Section 4. EFFECTIVE DATE. This resolution shall become effective upon adoption.
The forgoing Resolution was moved for adoption by Hill . The motion was
seconded by Mr_Partlan and, upon being put to a vote, the vote was as follows:
Mayor Ed Dodd aye
Vice Mayor Jim Hill aye
Council Member Fred Jones aye
Council Member Bob McPartlan aye
Council Member Christopher Nunn aye
The Mayor thereupon declared this Resolution duly passed and adopted this 14" day of October
2020.
CITY OF SEBAST�IAN,, FLORIDA
By:
Ed Dodd, Mayor
ATTEST:
aart
m it ram1.�•
Clerk
Approved as to Form and Content for
Reliance by the City of Sebastian Only
ANON. MAN
NY.
JR.1204795629M=91'i;1'
Manny Andn, Jr., City Attorney `
CR OF
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HOME OF PELICAN ISLAND
Community Development Block Grant
(CDBG)
Housing Assistance Plan & Procedures
For
CITY OF SEBASTIAN, FLOMDA
FY
2020 - 2025
September 2020
I. INTRODUCTION 3
II COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG/DRI) PROGRAMS OPERATIONAL
POLICES AND PROCEDURES
3
II. COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG/DRI) PROGRAMS — REHABILIATION AND
CONSTRUCTION POLICES AND PROCEDURES 25
III. CDBG DRI CATEGORY HOUSING REHABILIATION PROGRAM 50
APPENDIX A — DEFINITIONS
APPENDIX A — RESOURCES
48
50
September 2020
I. INTRODUCTION
This manual is a guide for implementing the housing strategies and related aspects of the
City's Community Development Block Grant (CDBG) Housing Programs, including the Regular
CDBG categories (henceforth "CDBG"), and the CDBG Disaster Recovery Initiative
(henceforth "DRI"). The responsibilities of the City, the Applicant homeowner, construction
contractor, the Program Administrator (PA) and the Housing Rehabilitation Specialists (HRS)
are specifically addressed in this manual.
The Program Administrator (PA) shall be the City Designee for oversight of this Housing
Assistance Plan (HAP) and Procedures, and his/her duties are addressed herein. The PA
shall approve all HRS work, including any Consultant or contract work, such as grants
administration or project delivery services. The PA makes all final recommendations and
decisions as to awards, monitoring reports, policies or other work generated by contractors or
consultants. The major focus of this manual is on housing finance, housing rehabilitation,
demolition/clearance, procurement and replacement of eligible, HRS-approved dwellings.
Relocation of households is also covered to a limited extent, as described herein. The Anti -
Displacement Policy should be consulted if displacement or permanent relocation becomes a
concern. Except under Federally Declared Disasters and similar extenuating circumstances,
and by waiver of the City Council and approval by the US Housing and Urban Development
(HUD), no CDBG housing activity shall be undertaken that causes displacement of legal
residents from a dwelling unit. Permanent relocation shall only be considered for replacement
units where the existing lot is not suitable for the replacement unit or is unsafe for the
residents. Eminent domain shall not be addressed using City CDBG Housing funds.
The goal of the CDBG program(s) is to meet the U.S. Department of Housing and Urban
Development (HUD) CDBG (DRI where applicable) National Objectives including but not
limited to the rehabilitation of substandard units, and the rehabilitation of units affected by
natural disasters, located within the unincorporated limits of the City and to bring them up to a
minimum acceptable living standard. This standard shall include the HUD Section 8 Minimum
Housing Quality Standards (Section 8 HQS), the current Florida Residential Building Code and
other relevant local codes (whichever is most stringent for each code -related item). This goal
will be achieved through the use of CDBG funds to contract for the required rehabilitation
construction. The rehabilitation units under the CDBG regular category and DRI categories to
be assisted shall be owner -occupied.
DISCLAIMER: Not all provisions apply to all programs herein. City staff, or designee,
reserves the right to make final interpretation of this plan. Further, in the event of any conflict
between or among any provision(s) herein applicable Florida Administrative Rules, statutes, or
HUD regulations the more stringent may be applied by City staff or designee.
II COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG/DRI) PROGRAMS OPERATIONAL
POLICES AND PROCEDURES
All procedures outlined in this section are applicable to all CDBG categories including Regular
Category Housing Rehabilitation, and the Disaster Recovery Initiative Housing Rehabilitation
and Assistance Category. The operational procedures in this section govern all categories and
may be amended or expanded by any requirements set forth in the individual strategies and
the different programs and categories may require.
September 2020
A. Housing Program Objectives
Maximizing community improvement and benefit should be the goal of any housing program
on its way to meeting national and/or State funding objectives. The objectives of the City's
Housing Rehabilitation Programs include but are not limited to:
For all CDBG Programs, to assist and encourage the revitalization of very low, low to
moderate income neighborhoods through a Housing Rehabilitation and Deferred Payment
Loan (DPL) Program.
a. AMI means Area Median Income
b. VLI shall mean very low income or thirty percent (30%) AMI
c. LI shall mean low income or fifty percent (50%) AMI
d. LMI shall mean low -to -moderate income or not to exceed eighty percent (80%) AMI
e. OI shall mean over income for the particular income for which an Applicant is applying
for benefit under the list above. OI households cannot benefit from CDBG direct
assistance (in this case housing).
2. For DRI Only, to encourage the revitalization of very low, low to moderate income
neighborhoods affected by declared natural disasters through a DRI Housing
Rehabilitation and Deferred Payment Loan (DPL) Program.
3. For CDBG and DRI programs, to remove unhealthy or hazardous conditions (slum and
blight) in VLI and LMI households.
4. To use Community Development Block Grant rehabilitation grant funds as a catalyst to
encourage residents of VLI and LMI neighborhoods to improve their community.
5. For CDBG and DRI programs, to address urgent community needs.
6. For all CDBG programs, to preserve existing housing stock, or replacement of substandard
housing.
7. For all CDBG programs, to enable VLI and LMI families to rehabilitate their homes by
providing financial and technical assistance to those unable to obtain private financing.
8. For all CDBG programs, to reduce utility costs and to improve the comfort of VLI and LMI
families through green construction standards and weatherization activities related to
rehabilitation.
9. For all CDBG programs, to improve the property tax base in VLI and LMI neighborhoods.
10. For all CDBG programs, to increase employment and training opportunities for local
residents and minority persons through the hiring of individuals and small businesses
owned and operated by Section 3 persons and businesses or persons residing in the
vicinity of local projects.
11. For all CDBG programs, to make homes accessible to elderly/handicapped occupants as
may be required by code, accessibility requirements or as determined at the City's
discretion.
September 2020
12. For all CDBG programs, to minimize impact of program participation on Applicants and to
limit direct costs encountered because of program participation.
13. For all CDBG programs, to adopt modern, green building and energy -efficient
improvements for building rehabilitation and construction.
14. For CDBG and DRI programs, treat all participating Applicant homeowners, residents, and
contractors fairly, with sensitivity and respect for their needs, and in accordance with
program rules.
15. For CDBG and DRI programs, to provide all program Applicants any reasonable
assistance necessary to carry out the objectives of the program, bearing in mind:
a. that Applicant homeowners hold the primary responsibility for maintaining their property
and personal finances,
b. that contractors are primarily responsible for the quality of their work and their
obligations to suppliers, creditors, subcontractors and employees; and
c. that any assistance provided must be authorized at the proper level.
16. For CDBG and DRI programs, to prepare and harden homes against high velocity winds
and wind-borne debris in the event of hurricanes and other such natural disasters.
17. For all CDBG programs, to allow some flexibility in administering the CDBG programs in
order to meet the overall CDBG goals and objectives of rehabilitating each addressed
dwelling, and to comply with HUD Section 8 HQS, the current Florida Residential Building
Code and any local codes that may apply. The City Council may waive program rules to
achieve CDBG objectives and benefits only when the result will be consistent with
established goals and objectives, and applicable federal, state or local regulations and
requirements.
18. For all CDBG programs, to adopt Complementary activities which are eligible activities, as
provided in Section 290.042, F.S., which are necessitated by the primary activity or project
scored in the CDBG Application for which grant funds are requested.
19. For all CDBG programs, to allow Complementary activities in the Housing category, which
include water and sewer hookups to provide service to units being rehabilitated or
providing rehabilitation to the kitchen and/or bathroom plumbing of houses so that they can
access water and/or sewer hookups. Water and sewer hookups are not complementary if
they are the primary activity because the home is not being rehabilitated except as needed
to allow the hookup.
a. For the purpose of this HAP the per- housing unit cost of providing service shall not
exceed $5,000. The use of CDBG funds for complementary activities may not exceed
thirty five percent (35%) of the total CDBG funds requested for the primary activity.
B. Key Terms
Program Implementation:
HAP: Housing Assistance Plan
PA: Program Administrator
HRS: Housing Rehabilitation Specialist
September 2020
DPL: Deferred Payment Loan
SOW: Scope of Work
Governing bodies:
CATF: Citizens Advisory Task Force
AHAC: Affordable Housing Advisory Committee
HRS: Housing Rehabilitation Specialist
HUD: US Housing and Urban Development
SHPO: State Historic Preservation Office
THPO: Tribal Historic Preservation Office
EPA: Environmental Protection Agency
Local Government: Local elected body
Recipient: Local governing body
Income Status:
AMI- Area median Income
VLI: Very Low Income: 30% of AMI
LI: Low Income: 50% of AMI
LMI: Low -to -Moderate Income: 80% of AMI
Other terms:
Section 3: a person or business that meets the Federal Section 3 definition
LBP: Lead Based Paint
ACM: Asbestos Containing Material
DRI: Disaster Recovery Initiative
C. Common Housing Program Types
Common Housinq Program Types: Community Development Block Grants: The Community
Development Block Grant (CDBG) program is a flexible program that provides communities
with resources to address a wide range of unique community development needs. CDBG
Grants consist of the following Categories:
1. Entitlement Communities:
The CDBG entitlement program allocates annual grants to larger cities and urban counties
(200,000 or greater in population) to develop viable communities by providing decent
housing, a suitable living environment, and opportunities to expand economic opportunities,
primarily for low- and moderate -income persons.
2. State Administered CDBG:
Also known as the Small Cities CDBG program, the State award grants to smaller units of
general local government (less than 200,000 population) that carry out community
development activities. Annually, each State develops funding priorities and criteria for
selecting projects.
3. Disaster Recovery Assistance:
HUD provides flexible grants to help cities, counties, and States recover from federally
declared disasters, especially in low-income areas, subject to availability of supplemental
appropriations.
September 2020
D. Purpose of Policies and Procedures
It is the policy of the City's Housing Rehabilitation Programs to document program policy
guidelines and procedures to be used by City staff in the everyday operations and practices
utilized in reaching the goals of the Housing Assistance Programs. Further it is the City's policy
to,
Assure that all programs are administered in strict conformance with the community
development and rehabilitation rules and all applicable local, state and federal
requirements (including equal opportunity, conflict of interest, etc.).
2. Assure that no member of the Congress of the United States, the Citizen's Advisory Task
Force (CATF), City Council, or any other elected official shall serve on the CATF or share
in proceeds or benefits of CDBG funded rehabilitation work. This monetary benefit would
constitute a conflict of interest.
3. With regard to regular category CDBG and DRI categories, housing rehabilitation will be
the first priority, with housing replacement units being addressed when program funds are
available.
E. Administrative Program Policies and Procedures
1. Housinu Assistance Plan (HAP)
A Housing Assistance Plan and Procedures guide shall be drafted and approved by the
local governing body to be used as a written guide for implementing program specific
housing strategies. Including but not limited to Applicant intake procedures, maximum
funding amounts, and specific program inclusions and exclusions.
2. Citizen Participation (See the City's Citizens Participation Plan)
As required by specific program rules and requirements, public hearings will be held to
provide information and discuss proposed activities to be undertaken, as well as address
questions or concerns from the public. All public hearings and workshops shall be
advertised in accordance with the appropriate funding agency (HUD, HUD) requirements.
3. Conflict of Interest
The adherence to the rules and regulations in regard to Conflict of Interest is mandatory. All
Applicants that may have a business or familial relationship with a member of the City
Council, CATF, HRS, PA, or participating construction contractors must fully disclose this
relationship on the Application and defiantly before a construction contract is executed. In
addition, all Applicant names must be disclosed at the regular meeting of the City Council
Meme and the CATF as the application process proceeds and these names must be
included in the minutes of both the City Council and the CATF meetings. The City Council
and CATF members must disclose any relationship with an Applicant and must abstain
from any vote related to that Applicant. Any cases of conflict of interests must be made
known at a meeting of the City Council. Before an Applicant with a potential or real conflict
as described in 24 C.F.R.570.489 (h)(2), is given final approval for participation the City
must notify HUD in writing. Prior to the expenditure of housing grant funds, the City must
receive written notification of HUD's approval of the waiver of conflict of interest, in
accordance with C.F.R. Section 570.489 (h)(4). If this process is not followed the City
and/or the Applicant may be liable for returning the funds expended to the program.
September 2020
City employees that submit an application for rehabilitation assistance and who are
involved in the decision -making process related to the CDBG program or are involved in
the financial approvals of this program must identify their conflict of interest at the time of
application.
The Federal requirements are found in 24 CFR 85.36 (b) (3) and 24 CFR 570.489(h). The
State of Florida requirements are found in Chapter 112.311—112.3143 of the Florida
Statutes. A Conflict of Interest is defined as a relationship or circumstances whereby a
person or organization exercises functions or responsibilities for funded activities through
which they, their relatives, or know associates obtain or appear to obtain a financial benefit.
Two types of conflicts are noted, those being beneficiary and procurement.
1. A beneficiary conflict of interest would involve any direct benefit, such as housing rehab,
utility hook-up or fagade renovation. The conflict would occur when benefits are
awarded to anyone with a role in the CDBG and or DRI program approval process, to
include but not limited to, a member of a CATF, PA, City officials and Council members.
There are however exceptions to this rule which are explained in 24 CFR 570.611 (d).
To request a waiver, the Applicant through the HRS and PA must be submitted in
writing to the City for approval, who must then submit the request to HUD for final
approval. Any costs incurred prior to HUD approval are unallowable. There are no
retroactive waivers.
2. A procurement conflict of interest exists if there appears to be a relationship between a
funded activity and City officers, their employees or agents, any member of their
immediate family or any organization that employs or is about to employ, any of the
afore -mentioned individuals. This conflict covers all aspects of the procurement, from
solicitation, to award, to administration to include the writing of the Applicant Selection
Criteria and in the Priority of Assistance, evaluating proposals and negotiating terms.
The affected person must not participate in the procurement process in any manner; the
level of conflict is irrelevant. Any conflict or appearance of a conflict requires non -
participation. A procurement conflict cannot be waived.
4. Fair HousinG ( See the Citv's Fair Housinq Policy)
The City and all its Contractors, Consultants and vendors receiving CDBG and/or DRI grant
funds shall comply with Title VIII of the Civil Rights Act of 1968, Restoration Act of 1987,
Sec. 800 [42 U.S.C. 3601 note] (Fair Housing Act), as amended, 24 CFR Part 92.252, Fair
Housing Rents, Title VI of the Civil Giants Act of 1 ut , Housing for Older Persons Act of
1995 (HOPA), Fair Housing Amendment Act of 1988, Age Discrimination Act of 1975, HCD
Act of 1987, as amended, Section 109 of Title 1 of the Housing and Community
Development Act of 1974 (570.487 and 570.495(b),Section 504 of the Rehabilitation Act of
1973, Americans with Disabilities Act of 1990 (ADA), Executive Order 11063, Executive
Order 11259. The City of Sebastian also will comply with 42 U.S.C. § 3604(f) (3), to ensure
that the design and construction of covered multifamily dwellings include features of
accessible design for disabled persons.
It is important to ensure that the housing program does not discriminate against any class
of potential Applicants. All persons must be treated equally and not discriminated against
September 2020
on the basis of race, color, religion, sex, national origin, familial status, and disability, when
serving housing needs.
The Fair Housing Act is the term commonly used to describe the provisions of Title VIII of
the Civil Rights Act of 1968, as amended in 1988. The Act states that it is unlawful to
discriminate on the basis of race, color, religion, sex, national origin, familial status, and
disability. In addition to what is covered under the Federal act, Florida law also prohibits
discrimination on the basis of material status.
This language should be included in all program information announcements and
advertisements relating to the housing program. It is important for housing administrators
to be familiar with Fair Housing Laws, as well as the more subtle forms of discrimination.
Where possible, application materials and handouts for Applicant meetings should be in
Spanish, and/or a multi-lingual representative of the organization receiving applications is
present to assist Spanish speaking Applicants.
It is the policy of the City to ensure that all state and federally funded projects and activities
prohibit discrimination in the sale, rental, and financing of dwellings, and in other housing -
related transactions, on the basis of race, color, religion, sex, national origin, familial status,
and disability (including children under the age of 18 living with parents or legal custodians,
pregnant women, and people securing custody of children under the age of 18).
5. Equal Opportunity Emplovment: (See the Citv's EEO Policv)
It is the policy of the City of Sebastian to use state and federal grant funded programs to
provide services to very low, low to moderate income Applicants. At no time will
employment opportunities provided through the expenditure of state or federal funds or
otherwise be denied on the basis of race, color, religion, sex, national origin, familial status,
and disability. Notice of the policy will be placed in plain sight on the job location for the
benefit of interested parties and all Contractors, Consultants, vendors will be notified. All
Equal Employment Opportunity Posters will be displayed as required by state and federal
guidelines.
Equal Employment Opportunity protects all employees and the potential employment of all
Applicants of the City and any Contractors, Consultants, and vendors receiving grant funds.
These requirements apply at all times for the City or Contractors receiving state or federal
grant funds.
6. Section 3 Employment Opportunities: (See the Citv's Section 3 Policv)
The City and/or Contractors, Consultants, and vendors receiving grant funds shall comply
with the Housing and Urban Development Act of 1968 (12 U.S.C. 1701 u) (as amended),
Section 3 Statute-12 U.S.C. 1701 u, Section 3 Regulation-24 CFR Part 135, 24 CFR
85.36(B)(8).
It is the policy of the City to use its best efforts to afford Section 3 residents and Section 3
business concerns the maximum practicable opportunity to participate in the performance
of all grant funded contracts. The City may rely on written representations by businesses
and residents regarding their status as Section 3 in lieu of an independent investigation.
September 2020
Every effort shall be made to notify Section 3 residents and businesses residing or
maintaining offices in the local area through public notices, as part of complying with
Section 3. Documentation of such efforts is required.
7. W/MBE Emplovment Opportunities: (See the Citv's W/MBE Policy)
The City and/or Contractors, Consultants, and vendors shall comply with: Public Law 95-
507, The Small Business Act, and Executive Order 11625 of 1971. It is the policy of the
City to use its best efforts to afford small businesses, minority business enterprises, and
women's business enterprises the maximum practicable opportunity to participate in the
performance of all grant funded contracts.
8. Permanent Relocation / Disrilacement:
General:
This activity involves replacement of an eligible owner -occupied unit. The City Council or its
PA will decide with the HRS on a case -by -case basis whether to utilize a slab "site built"
replacement unit, a prefabricated unit, or a modular home. Decision items will include
budget, zoning, replacement requirements, cost estimates, and a number of other items
that may vary on a case -by -case basis.
Once the decision is made, the HRS prepares bid specifications based on Applicant
homeowner input from review of available plans from the Contractor. Bidding contracting
and inspections then proceed as in the rehabilitation process.
For all CDBG categories, permanent relocation (due to flood plain, non -conforming lot,
hazards, etc.) and/or demolition -relocation are synonymous terms used in the rehabilitation
program when a home is unsound and not suitable for rehabilitation based on the structural
integrity criteria. The units must be redeveloped (replaced) on site or elsewhere due to
problems with the site. Homeowner eligibility requirements are the same as for
rehabilitation. Further policies are included in the local Anti -displacement and Relocation
Policy. In this HAP, demolition -relocation shall refer to replacement housing to build a new
unit in place of one that must be demolished for reasons outlined in this HAP and as
recommended by the HRS.
The Housing Program will comply with the Uniform Relocation Act (URA) and Real
Property Acquisition Policies Act of 1970. Except as provided for herein under a Federally
Declared Disaster (and then only by Council Waiver and HUD approval), the City will not
engage in any project under this HAP that displaces any legal, URA -covered occupants.
When provided for in the program budget, for homeowner occupied housing assistance,
temporary relocation services can be made available to qualified persons who need to
relocate while rehabilitation work is completed. The maximum assistance amount and
documentation required to show proof of use of funds shall be determined by the City Anti -
Displacement and Relocation Policy that covers those situations in great detail.
Applicant homeowners previously approved for proposed housing assistance may
voluntarily withdraw their application for assistance, which must be confirmed in writing. If
the PA determines the Applicant to be ineligible for assistance, the HRS shall recommend,
and the City will send written notification to the Applicant stating that the application has
been rejected and the reason for the rejection.
September 2020 10
9. Prooertv Acquisition: (See the City's URA Policy)
In the event the housing program needs or seeks to acquire property to address a specific
community need, some fundamentally required steps will need to occur in order to ensure
compliance and the success. Each purchase, or acquisition, may vary case by case.
However, in general terms, the following should take place:
1. Confirm source of funds and authority to acquire,
2. Identify the property/site and determine its suitability,
3. Perform legal description/boundary survey/preliminary title search (services procured as
necessary),
4. Send notice of intent to acquire to Owner,
5. Solicit appraisal services and retain Appraiser,
6. Where recommended by the HRS or program required, solicit review appraisal services
and retain review appraiser,
7. Receive appraisal review (when required), then solicit and retain Title Company (ies)
(title insurance amount and necessity determined in advance),
8. Send offer to purchase and notice of just compensation to Owner of no less than the
appraised fair market value,
9. Obtain Homeowner(s) acceptance of offer in writing
10. Finalize contract for purchase with Owner after City legal reviews and approves,
11. Company calculates settlement costs and closing date is set,
12. Closing conducted with funds changing hands and,
13. Records of proceedings retained.
10.Voluntary Acquisition:
The City may purchase property with CDBG/DRI funds for use on eligible activities. While
property acquisition must follow the procedures outlined in the Uniform Relocation and Real
Property Acquisition Act, residential property to be used for relocation purposes shall be
purchased only on a voluntary basis.
The City shall determine the features needed and the funds available for land purchases in
the State Sub -recipient agreement(s). When property is needed or required for CDBG/DRI
activities, solicitation procedures of the City shall be followed. The request will state the
specifications and budget and indicate that the purchase is voluntary. All property
acquired by any CDBG/DRI funds shall be meet all the requirements of the Florida CDBG
program and shall be used only for eligible CDBG/DRI activities.
No displacement of tenants (or other legal occupants) will occur as a result of any of the
City CDBG Housing programs. For lease property, owners do not receive any relocation
assistance. Owner -occupants under rehabilitation must voluntarily participate.
A voluntary acquisition occurs when real property is acquired from an owner who has
submitted a proposal to the City for purchase of their property in response to a public
invitation or solicitation of offers. The City Council is committed to this mode of acquisition
to the maximum practicable extent.
Voluntary acquisition shall be permitted only if the property being acquired is not site -
specific and at least two (2) properties in the community meet the criteria established by the
September 2020 11
City for usage, location and/or interest to be acquired. The City Council, prior to publication
of a public notice or attendance of any local government representative at a property
auction, must approve all voluntary acquisitions in principle.
A public notice must be published inviting offers from property owners. This notice must:
1. Accurately describe the type, size and approximate location of the property it wishes to
acquire;
2. Describe the purpose of the purchase;
3. Specify all terms and conditions of sale, including maximum price;
4. Indicate whether or not an owner -occupant must waive relocation benefits as a
condition of sale;
5. Announce a time and place for offers to be accepted; and
6. Announce that local powers of condemnation shall not be invoked to acquire any
property offered for which a mutually agreed to sale price cannot be reached.
Property may also be acquired at auction. The Uniform Relocation Act will be followed, but
all acquisitions shall be voluntary and without displacing legal, URA eligible occupants.
In each voluntary acquisition, a public solicitation shall occur. Offers shall be sealed and
opened at the same time, in the same place, by a City official. Records of offers shall be
kept. Appraisals are not required for purchases less than two thousand five hundred dollars
($2,500) if a mutually agreed -to sales price can be reached. Clear title must be present in
every transaction. The PA must decide at the time of approving the acquisition whether or
not appraisals and review appraisals will be necessary and what the maximum permissible
sales price will be. The decision to acquire will rest with the City Council that can reject or
accept any and all offers. Written records shall be maintained documenting decisions and
rationale for selected courses of action.
11. Non -Voluntary Acquisition Plan: (when applicable under DRI for emergencv purposes) (not
aoolicable under CDBG regular housing cateuories)
Acquisition of property (including easements and right-of-way) using federal funds shall
occur in accordance with the Uniform Relocation Act of 1970 (as amended) and with any
State and Federal regulations that may apply.
Fundamental steps that occur in each purchase may vary case by case. However, in
general terms, the following should take place: (1) source of funds and authority to acquire
confirmed, (2) property/site identified and suitable, (3) legal description/survey/preliminary
title search performed (services procured as necessary), (4) notice of intent to acquire sent
to owner, (5) appraisal services solicited and appraiser retained, (6) where recommend by
the HRS or program required, review appraisal services solicited and appraiser retained (7)
appraisal received and sent for review, (8) title companies solicited and retained after
review received (title insurance amount and necessity determined in advance), (9) offer to
purchase and notice of just compensation sent to owner, (10) owner contacted by attorney
or other representative and contract formalized, (11) settlement costs calculated and
closing date set, (12) closing conducted with funds changing hands and, (13) records of
proceedings retained.
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The Uniform Relocation Act requires certain specific procedures such as some letters being
sent via certified mail. The CDBG implementation manual provides a checklist that may be
utilized in following each transaction to successful conclusion. City CDBG/DRI housing
funds cannot be used in any way that would cause involuntary displacement. (Refer to the
City's separate Anti -Displacement Policy on this subject.)
12. Timing and Planning
Properties necessary for easements or acquisition shall be identified as early in the
planning stage as is practicable. Every attempt shall be made to affect a design that is not
wholly site -dependent that is where two or more sites are suitable for the project. It is
recognized this may not always be possible; however, a policy of minimizing single -site
alternatives is emphasized.
In general terms, the voluntary acquisition process shall be utilized to identify possible sites
early in the project. Sites shall be evaluated for suitability prior to the final design phase to
the maximum practicable extent. As soon as alternative sites are identified and evaluated,
applicable acquisition procedures should commence.
Projects shall not normally be sent out for bids unless properties to be acquired or utilized
for easements have been formally acquired or a commitment exists which is sufficiently firm
and binding to be considered safe for the project to proceed with start up. The PA shall
make the determination as to whether or not bidding, award and start-up may proceed to
closing on the property.
In those cases where needed for easements and/or acquisition is not identified until after
the project is underway, procedures shall be expedited to the maximum practicable extent
and utilization of funds, the value of which would be unrecoverable if the transaction did not
occur, minimized.
The City's Anti -displacement and Citizen Complaint Policies shall be followed in these
cases.
13.Appeals / Complaints: (See the City's Grievance Policy)
The HRS and the PA are authorized by the City to make all determinations of eligibility for
assistance and level of assistance, scheduling of rehabilitation, demolition and relocation,
and contract management. Citizens and/or contractors should issue complaints to the HRS
or the PA. For a complaint to be considered valid, it must be issued in writing within a
period of ten (10) calendar days of its occurrence. Responses also shall be issued in
writing. The City's Citizen Complaint and Grievance Policy, Citizen Participation Plan and
Fair Housing Ordinance shall be adhered to in addressing any complaints.
If the complainant is not satisfied with the PA's response, the issue must be presented in
writing to the City Mayor and/or City Manager) in accordance with the Complaint
Procedures set forth in the City's CDBG policies and procedures. Further action on any
complaints shall be governed by City CDBG policies, including Citizen's Participation and
Grievance Procedures. Any appeals will be made according to the City CDBG policies and
procedures. Further appeals, if necessary, must be addressed to the Florida Department
Economic Opportunity (HUD).
September 2020 13
14. Fraud
All levels of housing program management are responsible for the detection and prevention
of fraud, misappropriations, waste, and other inappropriate conduct as it pertains to the use
of specific program funding.
Fraud is defined in this document as a willful or deliberate act or failure to act with the
intention of obtaining an unauthorized benefit. Any fraud that is detected or suspected will
be reported immediately to the PA, who will conduct or employ on his/her behalf to conduct
an objective and impartial investigation into the fraudulent activity, along with other
applicable departments and/or law enforcement agencies, as deemed necessary or
appropriate. Any individual found to have engaged in fraudulent activity, as defined by this
policy, is subject to disciplinary action as program regulation and the law will allow, which
may include program, service, and/or employment dismissal, as well as prosecution by
appropriate law enforcement authorities, when appropriate.
15. Actions Constituting Fraud:
As used in this policy, the term "fraud" includes, but is not limited to, the following:
1. Any dishonest or fraudulent act.
2. Forgery or alteration of any financial document used for the purpose of program
eligibility.
3. Deliberately including and/or providing false information from the program assistance
application.
4. Deliberately withholding any required information requested to properly determine
eligibility status, including all assets, liabilities, incomes.
5. Destruction or concealment of records, income and/or assets.
6. Failure to disclose and/or an attempt to conceal any conflicts of interest relationships.
7. Failure to disclose and/or an attempt to conceal any required information on
employment.
8. Any similar or related inappropriate conduct.
16. Non -Fraud Irregularities and Conduct:
This Section covers allegations of personal improprieties or other irregularities not
constituting fraud, such as drug abuse or distribution of, vandalism, assault, murder, sex
offense or other such public nuisances, or criminal activity. Suspected improprieties
concerning employees, managers, committee members, elected officials, or constituents
seeking assistance from the various programs administered by the City, as it pertains to
moral, ethical, or behavioral conduct should be resolved by the appropriate Local
Government Department Director and Administration whenever possible. This section uses
24 CFR part 5 subpart I; PREVENTING CRIME IN FEDERALLY ASSISTED HOUSING -
DENYING ADMISSION AND TERMINATING TENANCY FOR CRIMINAL ACTIVITY OR
ALCOHOL ABUSE (5.851-5.861) and 24 CFR part 5 subpart J; ACCESS TO CRIMINAL
RECORDS AND INFORMATION ( 5.901-5.905), as a guide when referencing non fraud
irregularities and conduct.
17. Local Government Status Reports:
The housing program may as applicable to funding requirements, create and maintain or
require any of its Sub -Recipients, Contractors, Consultants and/or vendors to create and
maintain a quarterly status report. This report is to be presented to the PA/HRS on a
September 2020 14
regular pre -designated date and time each month. It is important that the PA and local
governing body be kept informed as to the project scheduling (i.e. bidding, work write-ups,
contracting, construction, and completion) and budget to ensure that program compliance
is being maintained. Every status report should be prepared in a format approved by the
PA/HRS and have an attached budget summary. The budget summary shall contain all
relevant construction cost, and demographic data relevant to budget and administrative
closeout audits and/or compliance reviews. Likewise, the HRS and PA will submit periodic
reports to the local elected officials and submit all required quarterly and annual required
reporting to the funding agency on time and as required.
The follow reports include but are not limited to and will be required by the funding agency:
1. Quarterly Status Report (QSR)
2. W/MBE Report (bi-yearly)
3. Section 3 Report (annual)
18. Subordination: (See the Citv's Subordination Policv)
Approved Applicant homeowners who have received financial assistance from the various
housing programs frequently request the local government to subordinate its interest in
their property to a new loan mortgage/deed of trust for the purposes of; refinancing an
existing first mortgage, obtaining a new line of credit, home improvement, or debt
consolidation.
The allowance of the subordination of the DPL shall be in accordance with the local policy
as approved by the City and/or the policy approved by the funding agency. An active
subordination policy is critical and is intended to protect the local government's financial
interest in the homeowner's property without unduly restricting the homeowner's access to
the equity in their property.
The language of the documents (grants, mortgages, deeds of trust) filed as liens against a
property to secure the City's interest prohibit the transfer of title, or portion thereof, without
prior consent by the City. Executing an additional lien, subsequent to the execution of the
City's security instruments, constitutes a transfer of title that would make the City's
loan/grant immediately due and payable.
19. Consent to Place Subordinate Lien
The City will generally consent to the placement of a Subordinate Lien upon written request
from the homeowner(s) under the following conditions:
1. Requests for Subordination of Lien must be approved by the PA, or his/her designee.
2. The following documentation at a minimum should be provided to the PA for
consideration of Subordination requests:
a. Proof of licensure of refinancing lender to do business in the State of Florida.
b. Authorization for Release of Information signed by the homeowner(s). Signatures
will be verified.
c. Written statement from the Homeowner(s) stating reason for the subordination
request.
d. Supporting documentation as to the validity of the reason.
e. Lender's Good Faith Estimate.
f. Complete terms and conditions of the existing loan and the new loan.
g. Documentation about payment of taxes and insurance and their status.
September 2020 15
h. Copy of appraisal or property valuation information with method of determining
same.
Note: Consideration should not be given to any request for Subordination of Lien without
this information. Additional information may be required.
3. Requests for Subordination of Lien will be reviewed, and a decision made on a case by
case basis on such merits as the following:
a. Emergency needs arising from a natural disaster.
b. Emergency housing repairs which eliminate a threat to the health or safety of the
occupants or that eliminate an immediate or imminent danger to the dwelling itself.
c. Refinancing to lower the interest rate on the first mortgage if the closing costs and/or
fees can be recovered within four (4) years.
d. There is sufficient property value to support all outstanding mortgages.
e. Refinancing for educational purposes.
f. Refinancing for medical emergencies.
4. Request for Subordination of Lien should not be considered under the following
circumstances:
a. The interest rate on the new mortgage exceeds the interest rate of the existing
mortgage.
b. The cumulative loan -to -value ratio exceeds 100%.
c. The housing debt -to -income exceeds 30%.
d. The total debt -to -income ratio exceeds 40%.
e. There is cash paid out to the borrower(s).
f. The mortgage lender and applicant fail to provide all required documentation.
5. Additionally, no subordination request should be approved if it contains any of the
following provisions:
a. Adjustable rate mortgage (ARM)
b. Balloon payment(s)
c. Open line of credit
d. Reverse mortgage
e. Prepayment penalty
f. Interest only mortgage
g. Negative amortization
6. In the event the City agrees to subordinate its affordable housing liens or mortgages:
Usually such consideration is given only for proven hardship. Payment of credit card
debt is not a basis for approval in accordance with the City's Subordination Policy. It is
the intent that granting of subordination shall be one time only and shall not include any
liens/mortgages recorded subsequent to the City's lien interest.
20. Refinancing Existing Superior Liens:
The City will generally agree to subordinate its interest in a rehabilitated or newly
constructed owner -occupied residential property assisted under the CDBG or DRI
programs if the proposed new loan is in an amount that does not exceed the current
aggregate balance of existing superior lien(s) plus reasonable closing costs. This policy
applies to both repayable and deferred payment loans. Requests for a Subordination Lien
September 2020 16
due to hardship will be considered on a case -by -case basis and are contingent upon state
and federal funder guidelines and rules.
21. Program Income
No program income is planned to result from the CDBG program. Program income should
only result in the case of DPL repayment where the title is transferred, or the unit is no
longer the primary residence of the Applicant homeowner. All Deferred Payment Loans
(DPLs) shall be zero -interest and deferred payment with repayment of CDBG/DRI funds
only in the event of transfer of title or where the eligible Applicant homeowners no longer
occupy the unit as a primary residence within the DPL period. After the expiration of the
HUD CDBG Award Agreement between the City and the State, the monitoring will be
performed by the PA annually through site visits and title verification through the Clerk of
Courts and City Appraiser offices. The City's DPL mortgage documents and liens shall
always include a notice to the City as soon as the title changes ownership.
If repayment of CDBG/DRI funds is received during the DPL period, it will be relegated
back to the US Housing and Urban Development (HUD) or used for additional eligible
CDBG/DRI activities as may be authorized by HUD. Program income or DPL payments
received subsequent to closeout will be returned to HUD (within ten (10) days or the time
frame allowed by HUD at the time of program income receipt if longer than ten (10) days)
unless the state's program income regulations are changed.
F. General Program Polices
1. Obiectives/Goals of Assistance: The Housing program is designed to provide the following
community opportunities:
a. To allow for public and community participation.
b. Provide safe and affordable housing solutions to very low (VLI) and low income (LI)
families and individuals.
c. To eliminate deficient code and housing quality standards (HQS) within the housing
stock of the community.
d. Eliminate housing units that can be considered to be a blighted influence on the
community.
e. Eliminate emergency housing conditions that pose an immediate health and safety
concern to residents/inhabitants.
f. Provide energy efficient and affordable green housing features to very low (VLI) and low
income (LI) families and individuals.
g. Address other housing issues that meet program funding criteria within the intent and
policy of the specific housing program.
2. Funding Sources
The funding sources listed below will be used to conduct all approved activities associated
with the CDBG/DRI Program. The specific rules and regulation requirements approved for
each program shall govern the specific use of the associated funds.
a. Community Development Block Grant (CDBG):
b. Community Development Block Grant Disaster Recovery Initiative (CDBG/DRI):
c. Matched or leveraged State Housing Initiative Partnership (SHIP) funds
September 2020 17
The above funding sources may be used to supplement all approved activities associated
with the CDBG/DRI Program. The specific rules and regulation requirements approved for
each program shall govern the specific use of the associated funds.
G. Priority of Assistance;
Priority of assistance is determined based on local need and specific program requirements.
When awarding funds for assistance to Applicants of housing -related services, it is important
for the City to establish a fair and equitable underwriting process for selection. For awards to
individual Applicants, criteria are established by the program requirements, the current
established HUD Area Median Income (AMI) limits, those affected by documented federal
disasters, and other non -demographic preferences, such as targeting to special needs
populations, elderly and disabled. Eligibility for individuals is based upon annual household
income and on a first come, first qualified, and first serve system.
Applicants must complete and submit all required information on all household members for a
determination of income eligibility and must be willing to execute all necessary documents on a
timely basis.
Ar}clicant Qualification Criteria and Requirements
Applicants will not be served until they have submitted a complete Application with all
documentation required and have been found by the HRS to be income -eligible and can
document clear and/or unencumbered title.
Income -eligible Applicants are those Applicants with household incomes that fall between Very
Low Income (VLI or 30% AMI) to Low -to -Moderate (LMI or 80% AMI). Income eligibility is
determined by using the total household gross income and shall be determined upon
completion of the application process.
Applicant Selection Criteria and Requirements
Applicants will be selected on a first -come, first -qualified, first -served basis and will be
documented by the individual(s) receiving the Applications by date and time stamp. Priority will
be given to VLI, veteran and handicapped applicants. Assistance is subject to funding
availability. No other ranking or scoring process will be used.
Armlicant Prioritv
While the City will be using a first -come, first -qualified, first -served basis for selecting
Applicants for program funding, the housing program recognizes there are times when priority
must be given to certain underserved groups or to meet funding agency requirements.
Other Applicant priority consideration factors are:
1. Applicants who are elderly (Greater than 62 years of age)
2. Applicants who are handicapped/disabled (with acceptable proof of handicap/disability)
3. Applicants who are veterans of any war as declared by the Congress of the United States
of America
September 2020 18
These other Applicant priority consideration factors will take effect in the event that Applicants
simultaneously submit an Application and it is not discernible by the individual(s) receiving the
Application which Applicant entered the facility to submit the Application first, or in the event
that the Applicants enter the facility to submit the Application at the same time and there is only
one individual to receive the Applications causing one person to have a later date and time
stamp on their Application.
In addition, if the HRS, in consultation with the PA and other applicable local government
departments (Housing, Building, Fire, Health Department or Code, etc.) determines that one
Applicant's housing unit poses a greater hazard to health and safety than another's, the
Applicant at greater risk of physical harm may be given priority (i.e. roof replacement would
take precedence over a window repair).
H. Applicant Intake
As required by specific program rules, the City will solicit and advertise the appropriate public
notification and public hearing(s) notices. A notice of funding availability shall be placed in the
appropriate media outlets to provide information and discuss specific program housing
activities to be undertaken with the available program funding. Subsequent to the public
hearing and advertising periods a minimum of:
1. One (1) Applicant workshop should be advertised and held in a public setting to address
additional questions or concerns from the participating public.
2. All public hearings, advertisements, and workshops shall be advertised in accordance with
the appropriate funding agency (HUD, and HUD) requirements.
An informed Applicant will help minimize future misunderstandings. To this end, Applicants
should be informed early in the process of the program's income limits, benefits, stipulations
for assistance; repayment terms (if applicable) and anticipated timeline from application to
assistance. This information can be effectively conveyed via a program and/or goal specific
fact sheet or program brochure and should be discussed during the initial Applicant workshop
and as required during any follow up contact.
The HRS shall review and Program Administrator shall review and rank the applications based
on a first come, first qualified, and first serve process. The DRI category will be based on the
same criteria.
The application process will have a noticed cutoff date for the receipt of applications.
Applications received after that date shall only be considered on a `first come, first qualified,
first served' basis as alternates after the primary list of Applicants has been considered and
exhausted and where sufficient funds still remain to address more units. Primary consideration
of `first come, first qualified, first served' status shall be when the Applicant complies with all
program criteria and has furnished all required documentation and can therefore be qualified
by the HRS, rather than time of receipt of the initial application. This is contingent upon funds
remaining available at the time of approval and the unit in question also qualifying. Income
qualification and unit qualification both apply (e.g. an Applicant completes their file and is
qualified, but the unit is in the flood plain or historic and insufficient funds remain to address
those issues. However, the next Applicant in the first come, first qualified, first served line
qualifies and only needs roof and window repairs within the remaining budget.
September 2020 19
The HRS or the City's PA may remove an Applicant from any CDBG program for a change in
household income, approved in the Applicant Selection Criteria, not complying with the
minimum qualification procedures, refusing to comply with the program requirements or HRS
directions (such as temporary relocation from an unsafe dwelling or work area), not accepting
the program standards or HRS recommendations for eligible repairs or other just cause that
would expose the City to unacceptable risk. If it is determined that it is necessary to remove an
Applicant from the program, a certified letter will be drafted and recommended by the HRS and
sent by the City to the Applicant stating the reasons for the removal. The Applicant will have
the right to appeal the decision as identified in the Citizen Participation Plan. The HRS's best
judgment shall be the guide in determining whether it is in the best interest of the program or
the City to reject a unit or application. The practical housing rehabilitation experience of the
HRS is critical in dealing with potential risk to the City or program, or the safety of the occupant
in cases where Applicants refuse to cooperate with program guidelines or HRS directions.
Note:
It is important to ensure that the housing program does not discriminate against any class of
potential Applicants. All persons must be treated equally when serving housing needs. The
Fair Housing Act is the term commonly used to describe the provisions of Title VIII of the Civil
Rights Act of 1968, as amended in 1988. The Act states that it is unlawful to discriminate on
the basis of race, creed, color, religion, age, sex/gender, familial status, national origin, or
disability. In addition to what is covered under the federal act, Florida law also prohibits
discrimination on the basis of marital status. This language should be included in all program
information announcements and advertisements relating to the housing program. It is
important for housing administrators to be familiar with fair housing laws, as well as the more
subtle forms of discrimination.
L Application Process and Applicant Eligibility
Listed below are the minimum functions to be performed in processing an Application for
Assistance. The City should make every good faith effort to notify the Applicant of eligibility
within thirty (30) days of the application date.
1. Review with the Applicant the objectives of the rehabilitation activities.
2. Advise the Applicant on the specifics of the grant program and other funding sources that
may be available.
3. Advise Applicant concerning the conditions under which a loan/grant is made.
4. Assign an application number and set up a separate file for each Applicant.
5. Check all local tax records to determine that property taxes are current.
6. Verify Applicant's household income. Retain documentation in program files. (Also housing
expenses and assets if they are used.)
7. Determine eligibility of the Applicant for assistance. Evidence that ownership of the property
has been verified through the Property Appraisers Office shall be retained in the office files.
The application for assistance should contain all the necessary information to determine
whether an Applicant is eligible for program assistance, including but not limited to:
1. The number of people residing in the household including name, age, relationship to head
of household, Social Security number, present address and home phone number and
employment status;
September 2020 20
2. Name and address of employer(s), work phone number(s), position title and number of
years on job with employer;
3. Sources of annual income, including earned, unearned and asset income (this subject will
be described in detail below);
4. A statement signed by the adults who reside in the household consenting to the disclosure
of information for the purpose of verifying income and assets for determining income
eligibility for program assistance.
5. A signed statement indicating that the Applicant understands that all information provided is
subject to Florida's public records laws.
6. An authorization for release of information sheet.
7. A statement that it is a first -degree misdemeanor to falsify information for the purpose of
obtaining assistance.
To ensure proper Applicant qualification, each Applicant shall also be required to provide, at a
minimum, the following documentation, as applicable, on a case -by -case basis.
1. Completed Application for Assistance and disclosures with signatures and date. (including
duplication of benefits documentation from FEMA, Insurance, SBA, family assistance, faith,
or community assistance documentation, and duplication affidavits)
2. Government Photo Identification for Applicant and any co -Applicants.
3. Proof of Ownership, e.g. recorded copy of Property Deed.
4. Current Property Tax Receipt.
5. Most current year's Tax Returns or current year's Tax Transcripts from IRS.
6. Paycheck Stubs (last 3 pay stubs for each working member, with additional and updated
stubs required at the City's discretion).
7. Most current Social Security Statement of Benefits for each household member.
8. Most current documentation for other assets - 401(k), retirement/pension, IRA, CDs,
annuities, etc.
9. Most current self-employment income statement with schedule C, E, or F.
10. Documentation on dependents claimed (including birth certificate, school records, court -
ordered letter of guardianship, divorce decree and/or letter of adoption).
11. Three most current bank statements for all open checking, savings or other interest -bearing
accounts at the time of application and at contract signing.
12. Property Appraiser documentation showing what year the unit was built.
13. Third party contact information and release to obtain third party verification of employment
signed by employer and notarized. This documentation must be received for eligibility
determination.
The PA/HRS should review the application carefully to ensure that the Applicant has provided
all sources of income, including total household assets and asset income. If an Applicant has
trouble completing the program application and providing the required back up documentation
necessary needed for final program eligibility. It may be preferable to schedule a meeting
between the HRS and Applicant to complete the application for assistance in a scheduled,
face-to-face interview where the Applicant can be prompted to provide accurate and
comprehensive income and household information. It is common for Applicants to
misunderstand what items to count toward annual income.
1. Applicant Responsibility:
September 2020 21
Applicant Homeowners and all household members are responsible for working in good
faith and in a responsible, reasonable, and timely manner with the HRS. Reasonable
deadlines shall be established at each step of the process of submittal of information by the
homeowner. Generally, after two written notifications, any refusal or failure to provide
information, or any established pattern of untimely submittal of information by the
homeowner, at the HRS's discretion and approval by the PA the Applicant's case file may
be closed.
J. Applicant Homeowner Eligibility Standards
In order for a homeowner Applicant to be eligible for purchase and/or rehabilitation assistance,
the following criteria must be met:
1. Total household income under CDBG and DRI must not exceed the very low income (VLI)
to low -to -moderate income (LMI) limits set for the HUD Section 8 program at the time
assistance is provided or no greater than eighty percent (80%) of the Area Median
Household Income (AMI) limits.
2. For regular category CDBG and DRI. The Applicant homeowner must possess and
provide clear title to the property, although it may be jointly owned, and the property may
be mortgaged. Ownership through life estate, heir property or other legal satisfactorily
documented ownership is considered satisfactory for program participation. Providing
proof of title is an owner responsibility and expense.
3. The Applicant homeowner must reside in the dwelling as a primary residence to be
rehabilitated for at least one (1) year prior to the time of application (owner occupied
assistance). In the case of the DRI category, the Applicant homeowner must have been
permanently residing in the dwelling unit as the primary residence at the time of the
declared disaster.
4. Property tax, mortgage payments and utility bills must be current, and ownership must not
be jeopardized by any other threat of foreclosure, default or clouded title to be eligible for
CDBG and DRI owner -occupied rehabilitation.
5. For all CDBG programs, the property must be fully insured for basic
hazard/homeownership insurance. Flood Insurance also applies in the one hundred (100)
year flood plain and the City must be named as a policy holder if the home is in the one
hundred (100) year flood plain. Flood insurance must remain in effect for the entire period
of the Deferred Payment Loan Agreement. Any unit to be addressed with CDBG funds
must be elevated to at least one foot (1') above base flood elevation (or to local code)
whichever is greater or disqualified due to cost infeasibility. This applies to all categories
and all activities involving construction.
6. For all CDBG programs, all Applicants that may have a business or familial relationship
with a member of the City Council, the Citizen's Advisory Task Force Committee, HRS, PA
and participating construction contractors must fully disclose this relationship at the time of
the Application, at the point in time in which the conflict occurs and definitely before a
construction contract is executed (see Conflicts of Interest)
September 2020 22
7. For regular category CDBG and DRI, if a boundary survey is required, the Applicant
homeowner is responsible for providing necessary proof or documentation at the
homeowner's expense.
8. Rental or other income generating properties are not eligible to participate in the CDBG or
DRI owner -occupied rehabilitation program. Only units occupied by the Applicant(s) with
clear title as a primary residence are eligible.
9. In DRI categories, lease units may be addressed if a) the City is seeking lease units to
meet DRI VLI or LMMI needs, b) the project is cost feasible, c) the unit(s) are income
restricted (either LI or VLI), d) the units comply with all HUD and HUD eligibility
requirements (or will by means of agreement and improvements), e) have CDBG eligible
repair needs and f) for VLI rental set aside funds, the property management agency
demonstrates capacity and the minimum five (5) years' experience required to participate.
Such properties shall be screened and qualified by the selection process and review of the
HRS. The property management organization is required to re -verify income annually for
all tenants.
10. Applicants may be required to attend a HUD approved eight (8) hour homebuyers'
education class prior to closing, this may apply to any new construction units under the
DRI program. The HRS will advise the City of any such requirements.
11. For all CDBG and DRI programs, the City shall take all reasonable measures to avoid
fraud and abuse. The City shall provide qualified oversight through competent staff of
contract program oversight. Any fraud or abuse of Housing funds shall be grounds for
disqualification. (See Fraud section of this document)
Each Applicant: to ensure proper homeowner qualification will also be required to provide at a
minimum the following documentation, as applicable on a case by case basis:
1. All CDBG programs: Completed application and disclosures with signatures and date.
2. All CDBG programs: Photo Identification for Applicant and any co -Applicants.
3. Regular Category CDBG and DRI: Proof of Ownership Recorded Copy of Property Deed.
4. Regular Category CDBG and DRI: Property Tax Receipt.
5. All CDBG programs: Most current year's Tax Returns or year's Tax Transcripts from IRS.
6. All CDBG programs: Paycheck Stub (Last three (3} pay stubs for each working member of
household) OR most current Social Security Verification (Statement of Benefits).
7. All CDBG programs: Most current other assets - 401(k), retirement/pension, Individual
Retirement Account (IRA), Certificates of Deposit (CD's), annuities, etc.
8. All CDBG programs (when applicable): Most current Self-employment income statement
with schedule C, E, or F.
9. All CDBG programs: Documentation on dependents claimed (including birth certificate,
school records, court -ordered letter of guardianship, divorce decree and/or letter of
adoption).
10.All CDBG programs: Three (3)) most current bank statements for all open checking,
savings, or other interest -bearing accounts at the time of application and contract signing.
11.All CDBG programs: Documentation showing what year the home was built after 1978.
12. DRI only: Documentation showing the Applicant was displaced or received damage from
Federally Declared Disaster.
September 2020 23
13.All CDBG programs: Third party contact information and release to obtain third party
verification of employment signed by employer and notarized. This documentation must be
received for legibility.
K. Duplication of Benepts
In regard to Disaster Recovery Initiative (DRI): Applicants who responded to an advertised
request for Applications must provide additional documentation as listed below:
1. Proof that the residence was impacted by the applicable federally declared disaster event.
2. All FEMA, Small Business Administration (SBA), and Insurance claim documentation.
3. Written certifications and proof of all benefits received.
4. All receipts and/or invoices for work completed using FEMA, SBA, and/or Insurance monies
from a filed claim.
Any and all program required self -certifications as is required by the funding agency, the
housing program, and applicable local governments
L. Applicant Household and Income Verification
The household and income verification process may vary slightly from one program to another
depending on the funding agency requirements. Generally speaking, an eligible household is
comprised of one or more natural persons determined by the eligible municipality to be of very
low income, low, low to moderate income according to the current HUD income limits adjusted
for family size. The HUD Handbook 4350.3 Chapter 3 Section 3-6 (E) provides guidance on
whether or not to count an individual as a household member. Whenever the handbook
indicates that an individual is a household member, the individual's full income must be
included in the annual income.
M. Household Income
An Applicant homeowner's household income eligibility status shall be determined based on
the total family Gross Annual Anticipated Income according to household size and make-up.
The income eligibility of each household will be determined in accordance with current HUD
"annual income" rules and regulations as defined in HUD Handbook 4350.3 rev 3 or those
adopted through the funding agents Consolidated Plan and approved by HUD.
All household income inclusions and exclusions can be found at HUD 24 CFR part 5:
http:Hi)ortal.hud.aov/hudoortal/HUD?src=/program offices/comm planning/affordablehousinq/t
raininq/web/calculator/definitions/part5
The income of each household assisted with any CDBG or DRI funds will be determined at the
time of purchase in accordance with 24 CFR 570.3 using "annual income" as defined by the
Section 8 Housing Assistance Payments Program to ensure income requirements are being
met.
The following rules are applicable in determining household income:
September 2020 24
For all CDBG programs, the gross income of all household members occupying the
dwelling is included in calculating household income. However, wages earned by
dependent minor children (under age 18) are not included in total.
2. For all CDBG programs, all Applicants applying for housing rehabilitation assistance under
the CDBG program will be subject to a third -party income verification process to ensure
that all Applicants meet the minimum income guidelines set forth by the established HUD
minimum income limits.
3. For all CDBG programs, occupants of a dwelling who are not related to or not dependent
upon the Applicant homeowner(s) are considered part of the Applicant homeowner's
household.
4. For all CDBG programs, rent or other household support contributed by non -household
occupants of a dwelling is included in household income.
For all CDBG programs: The Applicant homeowner s assets, with the exception of the home
in which he/she resides, unless previously assisted with SHIP funds, and personal property
such as an automobile, will be considered in determining eligibility. The actual annual income
from the asset will be calculated as part of the total household income. Inclusion of such
assets, if any, will be in strict accordance with 24 CFR 813.106 and any current modification
thereof.
II. COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG/DRI) PROGRAMS —
REHABILIATION AND CONSTRUCTION POLICES AND PROCEDURES
A. Identification of Units
Housing Rehabilitation will be performed only on units approved by the City and in accordance
with grant requirements established by the State of Florida DEO and the U.S. Department of
Housing and Urban Development (HUD). Alternate units may be provided to replace any
primary units that may become ineligible. The City will solicit applications either from other
housing assistance providers that have knowledge of need within the City, by placing notices
in public areas throughout the City and/or by advertising in publicly circulated publications.
The City will review applications received using the following selection criteria as defined in the
Priority of Assistance section of this document:
1. For all CDBG programs, has the Applicant previously been furnished assistance under any
City Housing assistance program including State Housing Initiative Partnership (SHIP) or
Disaster Recovery Initiative (DRI), or other such federal/state programs, and if so, when
and under what circumstances. A former Applicant that received assistance under the
regular CDBG category cannot be assisted for five (5) years and in any event will not be
served again until all other eligible Applicants have received assistance.
2. For all CDBG programs, number of persons in the family and the family income. Priority
will be given to Applicants that meet the VLI and LI Applicant selection criteria as defined
in the Priority of Assistance section of this document.
September 2020 25
3. For DRI, housing units identified by the City when the City falls under a Federally Declared
Disaster Event, having been affected by a disaster.
4. For regular category CDBG and DRI, type of construction (i.e., block, manufactured home,
wood frame, etc.), state of deterioration of the residence and estimated cost to rehabilitate
as compared to 1) average residence cost calculated in the application and 2) the value of
the residence after rehabilitation. Assistance for mobile or manufactured housing will be
included in the program but will be restricted to replacement of said structure with a site -
built home, unless prohibited by local or state regulations or infeasible due to applicant or
site conditions. The HRS shall make the final evaluation and recommendation for
addressing any mobile or manufactured units.
5. For all CDBG programs, location of the residence with reference to defined areas, i.e.,
floodplain, zoning, incompatible use, historic preservation, hazards, etc.
6. For all CDBG programs, compatibility (consistency) of the proposed residence
rehabilitation with the local Comprehensive Plan and/or land development regulations.
7. For all CDBG programs, confirm that the Applicant is current on all payments to the local
government (i.e., garbage/trash bill, utility bills, taxes, etc.) and mortgage/lien holders.
8. For all CDBG programs, Applicants' willingness to maintain reasonable standard of care
(code compliance) and maintenance to protect and enhance the investment by meeting
local nuisance, trash, and other environmental or health codes.
9. For regular category CDBG and DRI owner -occupied units, to be eligible, Applicant must
be able to show clear title to the property.
10. For all CDBG programs, is the structure is more than fifty (50) years old? The Applicant
shall indicate on the Application form whether to his/her knowledge the structure is older
than fifty (50) years. If the answer is "yes," or if other evidence suggests the structure is
more than fifty (50) years old, the City must notify the State Bureau of Historic Preservation
and receive written approval for the rehabilitation. Property Appraiser, tax records, or
other government agencies' records will be researched to verify the age of the structure.
11. The HRS shall make the final evaluation and recommendation for each Applicant and unit
as to whether they are appropriate under any CDBG or DRI program and the HUD and
HUD requirements. The City makes the final determination of acceptance of an Applicant
and of award of any units, subject to the guidelines of this HAP as set forth by the City
Council.
12. For regular category CDBG and DRI, for owner -occupied rehabilitation, owner -occupied
shall mean a residential unit with the clear title in the personal name of the Applicant(s)
used as the primary residence of the Applicant(s). This does not include any non-
residential unit or shared space with nonresidential uses or income generating property.
13. For all CDBG and DRI programs, this program will not assist in the rehabilitation or
replacement of rental housing structures.
September 2020 26
B. Eligible Property Types
Eligible property types will vary based on the specific goals and regulations of a specific
program and its funding origination. The most common eligible property types include but are
not limited to:
1. Single -Family Homes.
2. Townhomes, Condominiums units and Duplexes.
3. Mobile Homes (replacement only)
All properties must be within the approved program jurisdiction boundaries and the following
property eligibility criteria are applicable:
1. Type of construction, (i.e., block, mobile/manufactured home, wood frame, etc.), state of
deterioration of the residence and estimated cost to rehabilitate as compared to 1) average
residence cost calculated in the application and 2) the value of the residence after
rehabilitation. Assistance for mobile or manufactured housing may be included in the
program but will be restricted to the specific requirements set forth in the local program
guidelines unless otherwise prohibited by federal or state regulations or infeasible due to
Applicant or site conditions.
2. Any home eligible for assistance where the cost of rehab will be in excess of fifty percent
(50%) of the appraised value of the home as listed with the local Property Appraiser's office
will automatically be considered a replacement home.
3. Location of the residence with reference to defined areas, i.e., floodplain, zoning,
incompatible use, historic preservation, hazards, etc.
4. Consistency of the proposed residence rehabilitation with the local comprehensive plan
and/or land development regulations.
5. Whether or not the Applicant is current on all payments to the local government (i.e.,
garbage/trash bill, utility bills, code violations, taxes, etc.) and mortgage/lien holders.
6. Applicant's willingness to maintain reasonable standard of care and maintenance to protect
and enhance the investment by meeting local nuisance, trash, and other environmental or
health codes.
7. Whether or not the Applicant has clear title to the property. The Applicant shall have fifteen
(15) calendar days from the date of the City's review, which will include the results of a title
search. If fifteen (15) days pass without proper documentation or compliance, the
application will become an alternate (falling to the bottom of the list on the sixteenth [16tn]
day) and shall not be considered until 1) all other applications are exhausted with funds
remaining and 2) the Applicant has a completed file with full compliance with this
requirement and all others.
8. Whether or not the structure is more than fifty (50) years old. The Applicant shall indicate
on the application form whether to his/her knowledge the structure is older than fifty (50)
years. If the answer is "yes," or if other evidence suggests the structure is more than fifty
(50) years old, the City must notify the State Bureau of Historic Preservation and receive
written approval for the rehabilitation or demolition/replacement prior to the start of work.
9. The HRS shall make the final evaluation and recommendation for each Applicant and unit
as to whether they are appropriate and eligible under specific program rules and in
compliance with the funding agency requirements. The PA makes the final determination
of acceptance of an Applicant and of the award of any units, subject to the guidelines of the
local policies.
September 2020 27
10. Where applicable the HRS must complete the proper environmental review process,
including but not limited to a site -specific Tier 2 form, and receive written approval or
release of funds from the funding agency prior to the start of rehabilitation.
11. Partner -assisted programs (with "partners" being affordable housing developers,
community -based organizations, housing authorities, non -profits and similar affordable
housing providers) may be implemented as outlined in local policy guidelines. Partners
shall be selected using the Request for Qualifications (RFQ) or Request for Proposals
(RFP) competitive selection process. Deed restrictions and Deferred Payment Loans
(DPLs) apply. All unit and Applicant qualifications and monitoring by the HRS and PA
apply. Partners must agree to comply with all program specific requirements and submit to
monitoring and directions of the HRS before any funds are released or payments made.
12. For owner -occupied rehabilitation, owner -occupied shall mean a residential unit with the
title in the personal name of the Applicant(s) used as a primary residence of the
Applicant(s). This does not include any non-residential unit or shared space with non-
residential uses or income generating property.
C. Scope of Rehabilitation Assistance
CDBG financing of housing rehabilitation is available for the following purposes:
1. Addressing local housing code required repairs under current Florida
Building Codes requirements for Existing Buildings and local Maintenance Codes and/or
Section 8 HQS violations, whichever is most stringent for each code -related repair needs. This
will include Florida Energy Efficiency Code for new construction where it applies and
Accessibility Requirements (24CFR Part 8, 24 CFR 100.201, 24 CFR 100.205) where they
may apply.
2. Providing for cost effective `Green Standards and Additional "Green
Standards" as described in section J: Rehabilitation and Reolace Procedures. The most
current Florida Green Building Coalition checklist of green features including those required by
HUD and that are appropriate for the type dwelling shall be used as a list of options for
including affordable green features.
3. Providing reasonable repairs and modifications to make the dwelling accessible to
handicapped and elderly occupants as necessary and technically feasible. The HRS shall
determine the feasibility and eligibility of any such repairs; and
4. Correcting health and/or safety violations that may be present, including replacement of
dilapidated or malfunctioning stoves or refrigerators and interim controls or abatement of lead -
based paint hazards. The HRS shall determine the feasibility and eligibility of any such
repairs.
Except for DRI new construction or redevelopment activities, new construction such as adding
a room or closing in a carport is eligible for rehabilitation financing only to eliminate
overcrowding or to provide bathroom or laundry hook ups. In all CDBG categories general
property improvements are eligible for program funds when necessary to obtain an accurate
level of utility, to decrease high maintenance costs, or to eliminate blight. Examples of eligible
general property improvements include installation of cabinets and linen closets, functional
changes in room layout, replacement of unapproved or damaged floor coverings, and
enclosure of a porch for use as a bathroom where the dwelling does not have adequate interior
space.
September 2020 28
In the CDBG and DRI categories for owner occupied rehabilitation, some general property
improvements that are not required by code, and/or Section 8, HQS, or the work required by
the code and/or Section 8 HQS (creating a need for restoration) or other eligible reasons listed
above and recommended by the HRS may be provided at the owner's expense. The cost for
any such improvements shall be borne by the owner who must deposit the funds with the local
government prior to construction otherwise the additional items will not be included in the
construction. These items must be included in the Contract for Rehabilitation that is developed
and administered by the Program. However, ineligible new construction must be contracted
separately. Furthermore, any construction not covered in the construction contract will be
inspected by the local building inspector and will not be inspected by the HRS or PA.
D. ContractorNendor Listing
The Housing Rehabilitation Program will establish and maintain a current listing of eligible
contractors for bidding on all phases of the program. Only those contractors who are so listed
will be considered for work on this program. Establishment of this list will include maximum
outreach to allow for utilization of qualified local Section 3 and minority contractors.
Programs in which the funding originated from a federal source (CDBG, DRI) prohibit local
preference in accordance with 24 CFR 85.36, but require maximum compliance with Section 3,
W/MBE, and EEO practices as set forth in HUD and CFR regulations. Every effort shall be
made to notify Contractors residing or maintaining offices in the local area through public
notices, as part of complying with Federal Section 3 and Minority -Owned Business Enterprise
(MBE) requirements. This special effort will be based upon the list of Contractors licensed in
the jurisdiction including residential, building and general contractors. Letters sent to
Contractors, and/or solicitation advertisements, will be placed in the appropriate program file to
document compliance. In addition to active efforts to comply with Federal Section 3 and MBE
requirements, the City will follow all program requirements in its advertising and will promote
fair and open competition, with no restrictions to promote advantages for local firms or
businesses.
Contractors residing or maintaining offices in the local area will be recruited through public
notice to all such contractors, as part of the City's compliance with Section 3 requirements.
This special effort will be based upon the list of contractors licensed in the jurisdiction including
residential, building and general contractors. Letters sent to contractors, or advertisements
placed soliciting them, will be placed in the appropriate City program file.
The contractor listing will include all local contractors who apply and are determined eligible
based upon program qualification standards.
If the pool of local contractors is inadequate to provide a sufficient pool of contractors willing
and qualified to perform the rehabilitation work at prices that are considered reasonable and
comparable to the prepared estimate, other contractors will be solicited. Maintenance of a pool
of competitive, qualified, and capable contractors is essential to program completion.
The existing purchasing policy of the City vyill be used to determine eligibility of the contractors.
September 2020 29
E. Contractor/Vendor Eligibility
In order to participate in the Housing Rehabilitation Program, a contractor must be approved
as eligible by the HRS, the PA and by the US Housing and Urban Development (HUD).
Standard ContractorNendor qualifications include but are not limited to:
1. Current license(s) with the appropriate jurisdiction.
2. A satisfactory record regarding complaints filed against the contractor at the State, Federal
or local level.
3. Insurance:
a. Contractor's Public Liability Insurance in an amount not less than $1,000,000 aggregate
coverage
b. A certificate evidencing Worker's Compensation insurance in statutory limits in
accordance with Florida law.
c. A certificate evidencing Auto Insurance, including bodily injury, in an amount not less
than $1,000,000 per accident and in the aggregate.
d. A certificate evidencing General Liability insurance covering bodily injury, including
death and property damage, in an amount not less than $1,000,000 combined single
limit per occurrence.
e. Copies of certificates shall be provided to the PA. The Contractor shall provide the PA
with a certificate of insurance from the insurer guaranteeing thirty (30) day notice to the
Housing Rehabilitation Program before discontinuing coverage.
4. A satisfactory performance record, including:
a. References from two (2) suppliers who have done business with the contractor involving
credit purchases.
b. References from three (3) subcontractors or suppliers who have subcontracted with the
contractor.
c. Invoices will only be paid upon 100% satisfactory completion of work. Contractors
should possess the ability to finance all work for awarded rehabilitation contractsso that
all project related bills can be paid prior to requesting final payment.
5. Satisfactory references from at least three (3) parties for whom the contractor has
performed construction work.
6. Absence from any list of debarred contractors issued by the Federal or State DOL, HUD or
HUD.
7. Acceptance of all program requirements, including but not limited to Section 3 goals and
reporting. MBE goals and reporting and where applicable prevailing wage requirements.
The HRS will assure that current and past performance of the contractor are satisfactory based
upon readily available information and reserves the right to check any reliable source in
establishing such determination.
The HRS will explain the contractor's obligations under Federal Equal Opportunity regulations
and other contractual obligations at the pre -bid conference. Program procedures, such as
bidding, and payment will also be explained to the contractor.
F. Contractor Disqualification
Contractors may be prohibited or removed from program participation for, but not limited to:
September 2020 30
1. Poor workmanship or use of inferior materials.
2. Evidence of bidding irregularities such as "low -balling" (submitting an unreasonably low bid
in the hopes of increasing the bid amount through change orders once construction has
commenced), bid rigging, collusion, kickbacks, and any other unethical practice.
3. Failure to abide by the work write-up, failure to complete work write-up (and bid)
accomplishments, and any attempts to avoid specific tasks in attempts to reduce costs.
4. Failure to pay creditors, suppliers, laborers or subcontractors promptly and completely.
5. Disregarding contractual obligations or program procedures.
6. Loss of license(s), insurance or bonding.
7. Lack of reasonable cooperation with homeowners, HRS, PA, rehabilitation staff or the
others involved in the work.
8. Abandonment of a job.
9. Failure to complete work in a timely manner.
10. Inability or failure to direct the work in a competent and independent manner.
11. Failure to honor warranties.
12. Ineligibility to enter into federally or state assisted contracts as determined by the U.S.
Secretary of Labor, HUD or HUD.
13.Other just cause that would expose the Program or homeowner to unacceptable risk.
14. Failure to respond to a minimum of three (3) consecutive requests for bids.
15. At the contractor's request.
G. Eligibility Inspection
Each Applicant who applies for rehabilitation assistance is initially screened to determine
whether he/she is eligible for a 100% Deferred Payment Loan. A preliminary inspection of the
Applicant's unit is then conducted to determine feasibility of rehabilitation.
If either the owner or the structure does not meet eligibility requirements for program
participation, the HRS will reject the unit/Applicant. In the case of owner -occupied rehabilitation
and upon PA review and approval, a written rejection notification will be sent to the Applicant
via certified mail within ten (10) days stating the reason for rejection.
If both the Applicant and the house structure appear to be eligible for program participation, the
application/verification process continues. A work write-up with cost estimate is developed by
the HRS and approved by the Applicant and the PA. The cost estimate for the job is
considered confidential information until bid opening.
If special financing arrangements (such as the Applicant covering excessive costs or general
property improvements) are required or anticipated, arrangements must be made prior to
bidding to prevent soliciting bids on a home that cannot be financed. When the unit and
Applicant receive preliminary approval, bids are solicited for the job.
Once the HRS has found the Applicant and the dwelling unit to be program eligible, a full
property inspection and review will be conducted. The inspection process shall at a minimum
consist of the following:
1. The completion of the HUD HQS Inspection Form (optional at the HRS discretion).
2. The completion of the pre -Scope of Work (SOW) and inspection report further detailing all
code/HQS deficiencies and listing the areas in which rehabilitation is required.
3. The completion of the final SOW and cost estimate
September 2020 31
H. Bidding
Bidding of potential CDBG and DRI units is conducted by the HRS in conjunction with the City
Procurement/Purchasing Department. Applicants review the pre -approved list of eligible
contractors before their cases are sent out for bids. Applicants have the right to remove any
contractor(s) from the list of prospective bidders for their unit, as long as the removal request is
based on non-discriminatory, non -bias, or other non -subjective reasoning and at least three (3)
eligible contractors are allowed to bid. The Applicant must be willing to justify the removal of
contractor(s) from the bidding list. Applicants may also request additional contractors as
bidders. If these Applicant -requested contractors submit the Contractor Application and are
approved by the PA and are otherwise eligible, they may be added to the bidders list and bid
on the housing rehabilitation work. The HRS will make maximum effort to ensure participation
by minority and/or Section 3 owned contracting firms. Under CDBG and DRI, the HRS shall
qualify and recommend all contractors and other necessary vendors (lead -based paint,
asbestos, title search, mold, appraisal, land survey, environmental, etc.) for work the HRS
recommends or the program requires on eligible units. In these cases, the City policies shall
govern the qualifying and award process, including this HAP.
No housing unit owner, occupant, or immediate relative of the same, either personally or
corporately, shall serve as a contractor or sub -contractor to be paid with CDBG funds for the
rehabilitation of said building, nor shall they be paid for their own labor with CDBG funds for
the rehabilitation of said building.
A notice is sent via email, fax or U.S. Mail to each eligible bidder to inform them of the job.
Bidding notices will be posted at primary governmental buildings to the maximum practical
extent. Advertising for individual jobs will be conducted as necessary but will not exempt
contractors form the requirement that they must be pre -qualified.
1. Notification to Bidders (NTB): The HRS or assigned Housing Staff will notify previous
program approved Contractors of the availability of the work order and establish a date for
the pre -bid conference and bid submission deadline. Bids are opened in the public at the
designated time and bid tabulation is prepared.
2. Pre -Construction Meetinq: An onsite meeting will be arranged between the homeowner, the
approved Contractors and the HRS to review the scope of work and site considerations.
This meeting will also serve to allow for Contractor and homeowner introductions and
questions. Any questions that arise from the onsite meeting must be submitted in writing to
the HRS who is required to answer the question in writing and submit it to all approved
present Contractors. Questions may not be answered less than seventy-two (72) hours
prior to the established bid submission date. Each contractor MUST attend this pre -bid
conference held at the approved unit to be rehabilitated or inspect the house under the
Applicant's supervision. Failure to do so will result in automatic rejection of his/her bid(s) for
the unit(s).
3. Bid Submission and Award Recommendations: Bids will be submitted on the date and time
established in the Notification to Bidders advertisement and awarded in compliance with
the HAP requirements and the terms set forth in the NTB advertisements. Sealed bids will
be opened at a public bid opening. The HRS will generally recommend that the contract be
awarded to the lowest responsible bidder within plus or minus fifteen percent (15 %) of the
September 2020 32
cost estimate. Bidding procedures will adhere to City purchasing policy. Bids below the
fifteen percent (15%) threshold will be reviewed and are not automatically disqualified.
A minus ten percent (10%) participation incentive will be assessed for all Section 3 and/or
W/MBE firms at the bid opening to provide opportunity and encourage the participation of
such established and registered business types in accordance with HUD requirements. All
bid awards will be made available to the participating Contractors and homeowners.
The PA reserves the right to reject any and all bids and to award in the best interest of the
Applicant and the City. The Applicant must approve the bid award prior to signing
contracts.
No contractor will be allowed to have more than two (2) jobs per bid round, with a maximum
award of three (3) jobs under construction at one time without consent of the PA unless:
a. The anticipated date of commencement is after the scheduled and estimated date of
completion of current jobs; or
b. The contractor has demonstrated, through past performance, his/her ability to
satisfactorily complete multiple contracts in a timely manner thereby causing no impact
on project and program completions.
This rule may be waived by the City Council if it is determined that there is an inadequate
pool of qualified bidders, if the other bids are excessive, or if other extenuating
circumstances arise.
4. Contracts: Preparation of Contract Documents: The HRS or approved staff prepares
Applicant homeowner/City and Applicant homeowner/contractor agreements and sets a
time to meet with the Applicant homeowner and contractor to execute the documents and
mark the start of construction. These agreements at a minimum should consist of the
following:
1. Voluntary Participation and Final SOW Approval.
2. Final Income Certification and Affidavit.
3. Truth in Lending Statement.
4. Program Mortgage/DPL and Note.
5. Rehabilitation Agreement/Rehabilitation Contract.
6. Notice to Proceed.
7. Notice of Commencement.
8. Color/Style Selection Sheet.
9. Temporary Relocation Statement (where applicable).
10. Three (3) Day Recession Notification.
L Deferred Payment Loans (DPLS)
The CDBG/DRI Programs provide financing for eligible activities to income qualified Applicant
homeowners in the form of zero -interest Deferred Payment Loans (DPLs) (mortgage), the
amount of which shall include the accepted bid amount for rehabilitation plus a contingency
reserve. In the case of DRI, this can also include acquisition or purchase assistance.
1. Deferred Pavment Loans (DPL)
September 2020 33
a. Deferred Payment Loans (DPLs) are zero -interest loans with deferred payments that
become grants when and if all criteria are met by the Applicant. The DPL is provided to
a) homeowners who are unable or unlikely to obtain conventional financing due to their
income limits, or b) to assist disaster affected homebuyers in purchasing a home under
DRI.
b. DPL financing is also used in the CDBG and DRI categories to provide assistance with
housing rehabilitation and/or replacement of owner occupied, eligible units. The
Deferred Payment Loan (DPL) involves a security instrument (lien) requiring repayment
of the loan if the homeowner sells or transfers ownership of the rehabilitated home,
ceases to use it as his/her primary residence within the date specified in the terms of
the DPL, or fails to maintain reasonable required standards of care and maintenance.
During the specified lien period the principal is "forgiven' or subtracted from the principal
balance in equal annual amounts for CDBG and DRI rehabilitation loans, so that at the
end of the specified term of owner occupancy (by at least one of the Applicants if owned
jointly), the loan is fully amortized. There is no interest charged during this specified
term agreement.
c. In the event that the sole owner dies or both/all owners die within the specified loan
period, repayment of the loan will not be required, and the DPL is forgiven (i.e. it
becomes fully amortized upon the death of the final owner).
d. The assistance provided to each Applicant, at the time of closing, will be in the form of
either a primary or secondary mortgage. The mortgage will be recorded in the Public
Records of the City. The City will monitor possible triggers of the DPL repayment with
annual title verification with online City services through the Cleric of Court and
Appraisers offices and through visits to the assisted units.
e. The primary affordability mechanism is a Deferred Payment Loan (DPL) at zero interest
and is forgiven in accordance with the following schedule:
Assistance Amt. Lien/Affordability Period
Under $15,000.00 5 years
$15,001-$40,000.00 10 years
Over $40,001.00 15 years
Demo/Replacement 20 years
CDBG/DRI Forgiven Annually
100% forgiven only when mature
forgiven 20% annually after 1 st 5 years
forgiven 10% annually after 1 St 5 years
forgiven 20% annually after Vt 15 years
NOTE. With regard to Demo/Replacement (new construction housing), under the CDBG and
DRI Category DPL's must maintain long-term Affordability for the lien periods as described
above. In these instances, the CDBG and DRI funded DPL's are not forgiven annually for the
first 15 years. After the first full fifteen (15) years the CDBG and DRI funded DPL's are forgiven
20% annually for the next five (5) years until amortized.
If repayment of a DPL becomes due, the (prorated for CDBG and DRI) principal balance
will be due in full within thirty (30) days of the sale/transfer of ownership or the owner's
cessation of primary residence at the property. If the owner is unable to make such
payment, the City Council may, at their discretion, and with HUD approval, allow
repayment of the DPL over a term not -to -exceed fifteen (15) years, at a yield of not
September 2020 34
more than one percent (1 %) interest per annum, and/or allow transfer or sale of the unit
to another income qualified household for the remainder of the lien period.
g. Homeowners whose household incomes do not exceed the HUD Section 8 low -to -
moderate income limit will receive a Deferred Payment Loan for one hundred percent
(100%) of the cost of rehabilitation.
h. The maximum DPL for the regular CDBG and CDBG/DRI categories for an owner -
occupied single-family dwelling for repairs or replacement is eighty thousand dollars
rt$80,000).
i. If rehabilitation costs require more than maximum allowed DPL in the aforementioned
categories and the owner is unable to finance the additional cost, the dwelling unit may
be disqualified by the HRS unless matched, leveraged, or other alternative funding is
available. If the HRS considers it appropriate and in the best interest of the program,
CDBG funds may be used in lieu of alternative funding only upon 1) availability of
CDBG construction funds and 2) the approval of the City Council of a waiver of the
maximum DPL.
j. As a general policy, a contingency amount of approximately five percent (5%) shall be
placed on reserve for change orders. Exceptions may be made to this rule if the owner
provides a firm commitment in writing to pay for all required changes exceeding the
authorized loan limit, or if the PA determines that the situation does not require a
contingency fund.
J. Rehabilitation and Replace Procedures
All rehabilitation and replacement construction work shall include and address Section 8
Minimum Housing Quality Standards (Section 8 HQS), the current Florida Residential Building
Code and relevant local codes (whichever is most stringent for each code -related item).
When replacing older obsolete products and appliances the following "green" standards will be
implemented for all homes rehabilitated, including new home construction to include:
Green Standards
1. Refrigerators that are replaced or installed shall be Energy Star rated;
2. Gas water heaters that are replaced or installed shall be Energy Star rated;
3. All exterior doors and windows that are replaced or installed shall be Energy Star rated;
4. All lighting fixtures and ceiling fans that are replaced or installed shall be Energy Star rated.
Additional standards for all homes
1. Weatherization of all homes rehabilitated
2. At a minimum, weatherization shall include attic insulation, and if appropriate, floor
insulation, as well as sealing all exterior walls.
3. HVAC units that are replaced or installed shall be Energy Star rated and have a SEER
rating of at least 14.
4. Where feasible and cost effective as determined by the PA/HRS, all rehabilitation and new
construction work, major or otherwise, shall include the installation of water -efficient toilets,
showers, and faucets.
K. Structural Requirements
For all CDBG programs, in addition to household eligibility requirements for rehabilitation, the
dwelling must:
September 2020 35
1. Meet (or through feasible repairs meet) Section 8 Minimum HQS and,
2. Be feasible for rehabilitation. In order for a house to be considered feasible for
rehabilitation, proposed construction must:
a. Correct all violations of the local housing code, the current Florida Building Code and
Section 8 Housing Quality Standards;
b. Provide interim controls or abatement for lead -based paint hazards as required by HUD
and EPA for structures constructed prior to 1978 that will be assisted by the program.
All houses built prior to 1978 will be tested for lead -based paint. If lead -based paint is
found, interim control procedures will be used for all houses rehabilitated at or below
twenty-five thousand dollars ($25,000). Houses rehabilitated at a cost above twenty-
five thousand ($25,000) will be rehabilitated using abatement procedures. Any
occupants will be notified in writing of the hazards of lead -based paint, the symptoms
and treatment of lead poisoning, how to avoid poisoning, lead level screening
requirements and appropriate abatement procedures;(also see Lead Base Paint
procedures)
c. Meet applicable local zoning requirements, as well as local, State and Federal housing
code requirements for rehabilitation work;
d. Leave at least twenty percent (20 %) of the original structure based upon the formula
provided in this section;
e. Not exceed the program costs noted in this HAP;
f. Be made reasonably accessible to handicapped/elderly occupants, when the unit is
occupied by such;
g. New construction or substantial improvement of any residential building (or
manufactured home) located within the one hundred (100) year flood plain shall have
the lowest floor, including any basement, elevated no lower than one (1) foot above the
base flood elevation (or per local code). Should solid foundation perimeter walls be
used to elevate a structure, openings sufficient to facilitate the unimpeded movements
of flood waters shall be provided;
h. The HRS will determine if any special surveys or studies are needed and may require
any surveys or environmental assessments (with funds available) to determine
feasibility of a unit. The City designee and PA shall approve such special studies or
surveys before being ordered. If the recommended studies or surveys are cost
infeasible, the unit may be denied at the City's discretion, or the Applicant may pay the
cost of such studies or surveys the HRS recommends;
i. Provide interim controls or abatement for asbestos hazards as required by HUD, the
State and EPA that will be assisted by the program.
3. For regular category CDBG and DRI. Be suitable for redevelopment or replacement
housing units in cases where rehabilitation is not feasible and sufficient funds (CDBG and
DRI) are available for the completion of a new or replacement housing unit that meets all of
the above and all other criteria in this HAP. Redevelopment and replacement units must
meet all of these requirements to be eligible.
L. Structural Integrity
For all CDBG programs, rehabilitation requires that at least twenty percent (20%) (CDBG and
DRI) of the original structure remain after construction, based upon the following formula.
Three (3) major components of the house are considered, with each component weighted to
total one hundred percent (100%) of the structural value of the house. These components and
ratios are: roof — twenty percent (20%), exterior walls — sixty percent (60%), and flooring
system — twenty percent (20%).
September 2020 36
As an illustration, assume fifty percent (50%) of the roof must be replaced, fifty percent (50%)
of the walls must be replaced and twenty-five percent (25 %) of the flooring system (including
framing) must be replaced. The factors are then ratioed based on the 20/60/20 formula, so that
fifty percent (50%) replacement of the roof is equal to replacing ten percent (10%) of the
structure, fifty percent (50%) replacement of the exterior walls equals thirty percent (30%)
replacement of the structure, and twenty-five (25 %) replacement of the flooring system equals
five percent (5 %) replacement of the structure. Thus, replacement equals ten percent (10%),
plus thirty percent (30%), plus five percent (5%), or a total of forty-five (45%) of the structure.
This leaves fifty-five percent (55 %) of the original structure, indicating that the structure is
feasible for rehabilitation.
This calculation will be performed by the HRS. Should significant deterioration occur between
application approval and the time the unit is scheduled for rehabilitation, the unit will be re-
evaluated for continued eligibility and a decision made by the HRS whether to replace it with
an alternate unit in accordance with current HUD contract requirements.
M. Cost Feasibility
Pertaining to the CDBG and DRI categories, as an additional means of guarding against
program penalties for substantial reconstruction of a dwelling, the following cost limits are
applicable to all rehabilitation areas. These limits are above the allowable CDBG financing
limits and assume requirements for owner contributions or leveraging with other funding
sources. The limits may be exceeded for rehabilitation/replacement costs when alternative
funds are available for leveraging but must be specifically approved by the City Council or PA
as exceeding the described limits.
1. $80,000 per single family detached house (CDBG and DRI)
2. $50,000 per unit of a duplex, Townhome, or Condominium unit (DRI)
3. $20,000 per mobile home unit built after Jan. 1, 1997(CDBG and DRI)
In addition, for the CDBG and DRI categories, the cost of rehabilitation and improvements may
not exceed the after -rehabilitation value of the dwelling. In the absence of conflicting
information, the mobile home CDBG cost limits shall be assumed to meet this requirement. For
site -built dwellings, the total cost of rehabilitation (plus other improvements, if any) may not
exceed eighty dollars ($80) per square foot of dwelling space, excluding septic tank, well, or
water/sewer hook-ups, which is less than the cost of new construction and will be assumed to
meet the cost/value limit.
N. Clearance
Requirements are identified by the HRS and are included in the replacement unit bid package.
In this way, the same Contractor is responsible for site cleanup and preparation as for
provision of the replacement unit. Disposal of debris and associated activities are also included
if this method is utilized. When demolition or clearance is conducted separately, bid packages
are prepared with procedures following those identified for rehabilitation in this manual.
O. Rehabilitation / Demolition Differences
A major difference between assistance provided to demolish / replace an entire unit and
rehabilitation work is that, with a demo / replace unit, the DPL issued is not for the full value of
the replacement unit (owner occupied). (With rehabilitation, the DPL is issued for the full value
September 2020 37
of the rehab work performed.) The value of the DPL is based on a calculation that takes the
difference between the assessed value of the original unit (real property not included) and the
actual cost of the new unit (without real property). The difference is the value of the DPL. This
is because the dilapidated unit that was demolished belonged to the Applicant homeowner and
is being replaced on a one -for -one basis. Ownership of the replacement unit is vested directly
to the homeowner with no interest on the part of the local government (except for the DPL).
Generally, the local government will accept interim ownership of mobile homes to save
program costs (taxes) with transfer to the homeowner as soon as possible, upon satisfaction of
the DPL.
1. No partial payment is provided for modular replacement units, as the time frame to
complete the transaction is relatively brief. The Contractor is paid in full upon satisfactory
completion of work and providing of warranties. Partial payments are utilized for site -built
homes along the same lines as for rehabilitation work.
2. Program disbursements are made from the local CDBG operating account. As a result,
attention must be paid to the ordering and receipt of funds, to ensure that disbursements
are made in a timely manner and that the CDBG/DRI limitation for cash on hand is not
violated.
3. Rehabilitation cost feasibility limits are based on number of bedrooms to be provided for
site -built homes. These limits may not be exceeded without approval from the City Council
are:
a. four or more bedrooms - $80,000 CDBG/DRI
b. three bedrooms - $70,000 CDBG/DRI
c. two bedrooms - $60,000
In the case of replacement of existing SF/ mobile/manufactured homes, the limit will be based
upon the acceptable bid price of a replacement home of comparable size. If the existing home
is inadequately sized, the replacement home will be sized to include the appropriate bedrooms
needed to meet Section 8 and/or local housing code requirements for occupancy. In no case
will the total assistance be greater than those limits listed above, unless approved by the City
Council or its PA.
Necessary CDBG approved site improvements, including water supply, sewage disposal, and
clearance, will also be provided along with the actual dwelling replacement.
P. Temporary Relocation
The CDBG Housing program provides an allowance for temporary relocation assistance to
qualified persons who need to relocate while the work is being completed on their primary
residence. The City will either;
1. Assist eligible Applicants with up to one thousand dollars ($1,000.00) of
Assistance ($500 at move out and $500 upon return: Award of temporary relocation assistance
is based upon the availability of funds.
September 2020 38
Q. Contracting and Commencement of Construction
The HRS recommends the contract amount and contractor to the PA before the DPL and
contract are signed. The DPL amount, contract amount, contractor, unit and owner eligibility
are all approved by the PA.
The rehabilitation contract is then executed between the Applicant homeowner(s) and the
Contractor. The contract should contain all federal provisions, including but not limited to EEO,
Section 3, W/MBE, drug free workplace, and insurance statements. The DPL is executed by
the PA on behalf of the City simultaneously with the construction contract, with the three (3)
day rescission period running simultaneously for both legal agreements.
For all units, the DPL and the Notice of Commencement are recorded immediately, no more
than three business days of execution. The program pays for recording of the Agreement. The
filing of the Notice of Commencement shall be the responsibility of the Contractor.
The Notice to Proceed is issued to the contractor as soon as possible after the rescission
period elapses. For the CDBG and DRI categories, when temporary relocation of the
occupants is required, the Notice -to -Proceed will be delayed until the unit is vacated. The
contract time of performance (generally 30 - 45 days for rehabilitation and 90 - 180 days for
replacement or redevelopment) begins with issuance of the Notice to Proceed. The HRS shall
recommend the appropriate contract period based on the type, size and complexity of the
work.
R. Construction Progress Inspections
Periodic inspections of the rehabilitation construction are performed by the City and the HRS
throughout the contract period. These inspections are conducted to assure compliance with
the contract standards for workmanship and materials, to detect any unauthorized deviations
and to identify necessary changes to the contract work in its early stages.
Inspection and approval of completed work must be conducted by the HRS prior to the
contractor receiving partial or final payment. The Applicant homeowner's acceptance of the
work is also required before payment is received. No final payments will be issued until the
City Building Department issues a Certificate of Completion or Certificate of Occupancy and all
lien wavers are collected and cleared.
S. Change Orders
Any additions to, deletions from, or changes in the rehabilitation contract work, time, or price
must be approved in a written Change Order before the additional work is started. The Change
Order may be executed by the Applicant homeowner and contractor and is approved by the
HRS and the PA. All change orders must be approved by the PA and the HRS. Change
orders may also be issued to correct code deficiencies, or to obtain any other desired change
in the work. CDBG funds can only be for Change Orders that correct code violations as
documented by the local building department, a bonafide code violation report, time, or to meet
Section 8 HQS found after rehabilitation begins.
For CDBG and DRI categories, additional non -code -related changes will be at the Applicant
homeowner's expense.
September 2020 39
T. Payment
Contractor payments are to be consistent with local policy, unless otherwise approved by the
City and the funding agency as allowable by all applicable regulations. Specific payment policy
depends on the program, and the type and amount of assistance being provided, and the
contract awarded.
There will be NO payments shall not be processed without proper signatures from the owner,
the contractor, the HRs, and the PA. Also, no payments shall be processed without completed
primary and subcontractor lien waivers as applicable to the contract award or as required by
the local policy.
Contractor Payment request and submissions should at a minimum follow these general
guidelines:
1. Contracts of twenty-five thousand dollars ($25,000) or less will not be paid until the
Contractor has completed the job.
2. Contracts in excess of twenty-five thousand dollars ($25,000) allow a partial payment upon
satisfactory completion of sixty percent (60%) (and 100%, see below) of the rehabilitation
work (less punch list items), with a retainage of twenty percent (20%) of the completed
contract amount.
3. Depending on extenuating circumstances and contract balance, a second partial payment
may be authorized at the recommendation of the HRS or PA.
Construction Completion
Less than 50%
50 % and all permits pulled
100%
100%
Approval of a partial payment requires:
Percentage of Funds Paid
0%
50%
80%
After Certificate of Occupancy is issued and all punch
list items are completed.
1. A determination by the HRS and the PA that the claimed percentage of completion of the
work has been satisfactorily completed. Payment will be issued for the amount claimed less
retainage depending on the physical progress as long as the contract funds remaining are
sufficient to complete the work in the event of default by the Contractor.
2. Payment will be issued for the amount claimed less retainage depending on the physical
progress as long as the contract funds remaining are sufficient to complete the work in the
event of default by the contractor.
3. Approval of the work by the Applicant homeowner and/or PA.
4. An affidavit from the Contractor stating that either:
a. There are no claims for unpaid goods and/or services connected with the job,
a. All laborers, suppliers and subcontractors have received just compensation for their
goods,
b. Services up to the date of the request (as evidenced by full or partial waiver of lien from
subcontractors); or
c. A list of all unpaid parties and the amounts owed to each has been submitted with the
request.
September 2020 40
The final payment approval requires:
1. Acceptance of all work by the Applicant homeowner, the HRS and the PA.
2. Submission of all manufacturers' and other warranties (e.g., appliances, roofing,
extermination, contractor's warranty covering the entire job for a minimum one (1) year,
etc.).
3. Waivers of liens from all subcontractors, all parties who were not paid when the contractor
received partial payment, and from any other party supplying notice.
4. A certificate of occupancy or final approval from the Building Department to show
compliance of the rehabilitation work with the locally adopted building (and other
applicable) code requirements.
5. Completion of all punch list items and
6. An affidavit from the contractor stating that all bills have been paid and there are no claims
for subcontracted jobs or materials, or any outstanding Notice to Owner.
If the Applicant homeowner refuses to authorize payment due to a dispute with the Contractor,
the PA may recommend disbursement without the Applicant homeowner's approval if the claim
is shown to be without merit or inconsistent with the policies and the goals of the program.
Such disbursement shall be issued only after the PA and the HRS have reviewed the facts and
circumstances involved in the dispute and have determined that the Applicant homeowner's
refusal to issue payment is without just cause. If a person or party feels that his/her complaint
has not been sufficiently addressed by the HRS or PA, an appeal may be made to the Citizen's
Advisory Task Force (CATF) in accordance with the City's CDBG Citizen Participation Plan. If
a response satisfactory to the aggrieved is not issued by the Committee, an appeal may be
made to the City Council. The City Council has the authority to uphold, rescind or reverse a
previous CATF determination. An appeal of the local determination/decision made by the City
Council should be filed with HUD, as set forth in the City's CDBG Citizen Participation Plan.
Sufficient documentation to this effect shall be placed in the Applicant's file.
U. Disputes and Contract Termination
Regarding disputes, and as authorized and outlined in the construction contract, the
Homeowner and/or the City have/has the right to stop work and terminate the contract in
accordance with approved program policy.
The Applicant homeowners shall make themselves available to the Contractor to resolve all
and any issues that might facilitate completion. The Homeowner is also requested to notify the
HRS and the PA of any complaints to the Contractor so assistance in follow-up can be
provided. If the Contractor does not respond to any oral or written complaints within a
reasonable time frame and in a satisfactory manner, the HRS will verify the complaint and
report it to the PA. If the PA judges the complaint to be valid, he/she will send a written request
for service to the Contractor and a copy to the Homeowner. The Contractor will then take
action as monitored by the HRS and the PA. Upon receiving notice that the complaint has
been satisfied, the HRS will inspect the work and make such note in the case file. Failure to
resolve complaints shall be justification for removing a Contractor from participation with the
program including but not limited to:
1. Inability or failure to direct the work in a competent and independent manner.
2. Failure to honor warranties.
September 2020 41
3. Ineligibility to enter into federally or state assisted contracts as determined by the U.S.
Secretary of Labor, HUD, E-Verify or HUD.
4. Other just cause that would expose the local government, the Program or Homeowner to
unacceptable risk.
5. At the Contractor's or Homeowner's request with cause.
V. Project Closeout
The project award work plan and timeline should be monitored on an ongoing basis by the
HRS and PA to ensure that the program is on schedule and is in compliance with the executed
funding agreement between the local government and the funding agency. All project closeout
reports and documents must be completed and submitted to the correct funding agency on
time and as required.
W. Program Compliance and Monitoring
When preparing for a compliance monitoring visit, the HRS and Program Administrators and
staff should review all Applicant and Program files for completeness of documentation. Special
attention should be given to ensure that the income eligibility documentation is mathematically
accurate and legible. All files should be orderly and systemically organized. All financial
information relevant to each transaction should be easily found, and the files should have
copies of invoices and proof of payment. The file should be accessible, and a comfortable
space should be provided for a thorough review. Copies of all advertisement and contracts
should also be available.
The following data will be provided by each housing unit as part of the administration
documentation for each activity providing direct benefit (for example, housing rehabilitation,
temporary relocation, hookups, etc.) and summarized by activity and maintained in the
program files:
1. Name of approved Applicant and address of each housing unit rehabilitated with CDBG
funds and the date the construction was completed on the housing unit, and the amount of
CDBG funds expended on that housing unit.
2. Whether the household is headed by a female, the number of handicapped persons in the
household, the number of elderly persons in the household and VLI or LMI status of the
household.
3. The number of occupants in the household, categorized by gender.
4. The racial demographics of the household by number (white, black, Hispanic, Asian/Pacific
Islander, Hasidic Jew or American Indian/Alaskan native).
Ill. CDBG DRI CATEGORY HOUSING REHABILIATION PROGRAM
The goal for the City CDBG Disaster Recovery Initiative (DRI) Housing Program is to provide
down payment assistance, rehabilitate or replace existing owner -occupied housing units
located in the City that sustained damage as a result of federally declared natural disaster(s).
A. Housing Rehab or Demo/Replace Activity — Objective
September 2020 42
To provide a Deferred Payment Loan (DPL) to VLI and LMI income residents whose homes
were damaged by a Federally Declared Disaster. The purpose of the program is to bring the
residences that sustained damage during a federally declared disaster up to Section 8
Minimum Property Standards, Florida Residential Building Codes, and the local codes
currently in effect in the City, whichever is most stringent for each housing unit need.
B. Housing Rehab or Demo/Replace Activity — Financing
The type of assistance which will be available to eligible residents is known as a Deferred
Payment Loan. A brief description of this program is presented below. The DPL is a zero (0)
percent interest loan provided by the City. The funding for the loan will come from the City's
CDBG DRI Program. The DPL will be secured by a recorded mortgage on the Applicant's
property. A DPL will be available for all approved Applicants contingent upon available funding.
VLI and LMI Applicants will qualify for a DPL wherein the DPL Amount will be forgiven in
annual increments as described in the CDBG Program Operational Procedures section of this
document.
C. Housing Rehab or Demo/Replace Activity — Eligibility
1. Only those mobile home properties that are conventionally built structures and mobile
homes built after January 1997, which are owner -occupied and located within the City, will
be considered for participation in the rehabilitation program. No mobile homes built prior to
December 31, 1996 will be considered for rehabilitation.
2. Applicants' incomes must fall within the HUD Section 8 Income Limit guidelines as
published by HUD and/or the State of Florida for the region.
3. Priority will be given to Applicants who sustained damage from a federally declared disaster
in the following order:
a. Participants who responded to the City's advertised request for Applicants whose
residences were impacted by the disaster events and who have been qualified and
ranked by the City for inclusion in the Disaster Recovery programs, provided the City
solicitation for affected Applicants took place after the declared events covered in a
federal declaration.
b. If the current list of Applicants does not obligate all of the available funding, then a new
solicitation for impacted residents will be published.
c. All other Applicant eligibility requirements are described in the CDBG Operational
Procedures section of this document.
d. Priority will be given to Applicants who sustained damage in a Federally Declared
Disaster.
e. No geographic distribution of funding shall be considered, except where specified in the
State Sub -recipient Agreement.
4. To select Applicants in both the Rehabilitation and Permanent Relocation Activities, the
following steps will be taken:
a. The City will utilize the list of potential Applicants developed from previous solicitations
(SHIP, HHRP, FEMA) when available for the Federally Declared Disaster.
b. If sufficient clients are not obtained from the previous solicitations, a display ad will be
placed in one or more local newspapers of general circulation advising local citizens of
the availability of grant funds and establishing a convenient time and place for
interested citizens to obtain information and pick up application forms. Applications will
September 2020 43
be accepted by the City for a minimum thirty (30) calendar days after the notice is
placed.
c. Local organizations which normally work with clientele that may qualify for the program
shall be contacted.
d. Prior Applicants who have applied for but did not receive City CDBG/DRI assistance will
be contacted and advised of the funding assistance and requested to submit an
Application.
Once a list of potential Applicants is obtained, the HRS shall perform initial inspections on the
dwellings to determine which of the following categories they fall into:
D. For conventionally r'site'? built structures and modular homes:
1. Rehabilitation for these structures is not to exceed eighty thousand dollars ($80,000.00).
2. If the cost of correcting all existing code violations is estimated to exceed eighty thousand
dollars ($80,000.00) or, the unit is deemed structurally unsound and not feasible for
rehabilitation, the dwelling will be considered for Demolition Replacement, wherein the
Applicant homeowner provides the additional funding needed to complete new construction
or where additional funds have been appropriated to the program for the specific purpose
of demolition/replacement.
E. For mobile homes built after 1996:
1. Rehabilitation for these structures is not to exceed twenty thousand dollars ($20,000.00).
2. Replacement housing — if the cost of correcting all existing code violations exceeds twenty
thousand dollars ($20,000.00), or if the mobile home is deemed structurally unsound and
not feasible for rehabilitation the dwelling will be considered for demolition replacement,
wherein the Applicant homeowner provides the additional funding needed to complete new
construction or where additional funds have been appropriated to the program for the
specific purpose of demolition/replacement.
F. Temporary Relocation:
The CDBG/DRI Housing program provides an allowance for temporary relocation assistance to
qualified Applicants who need to relocate while the work is being completed on their primary
residence. The City will: 1) assist eligible Applicants with up to $1,000.00 of assistance,
G. Applicant Requirements:
1. Applicants must be income eligible in accordance with HUD LMI income requirements.
2. Applicants must be able to produce clear title in order to receive assistance from the
CDBG/DRI program. The City is not providing funds for the entire rehabilitation cost of the
home. Other funds or match funds could be utilized.
3. The Applicant must complete a Purchase Assistance Application.
4. Applicants must sign the City's Mortgage and Promissory note. The City's mortgage
(typically a second mortgage) is forgiven after 5, 10, 15, or 20 years — depending on the
amount of assistance received.
5. Total household income cannot exceed eighty percent (80%) of the Area Median Income
(AMI). Please see HUD income guidelines.
6. Applicants must be able to verify and document all income and assets of household
members above eighteen (18) years of age residing in the housing unit.
7. Applicants are processed and served on a 'first come, first qualified, first served' basis.
September 2020 44
H. Program Benefits:
1. CDBG funds can be used to pay up to $80,000.00 of the Applicants' required rehabilitation
to address code violation corrections.
2. Increase housing stock; remove slum and blight conditions, correct code violations.
3. Address health and safety conditions and concerns.
4. Increase City tax base.
5. Increase homeownership.
6. Assistance with the rehabilitation process.
1. Eligible Properties:
1. Single -Family Homes.
2. Townhomes, Condominiums units and Duplexes.
3. Mobile Home built after Jan. 1, 1997.
4. Limitations on maximum CDBG rehab costs - $80,000.00.
5. All properties must have an inspection.
6. All properties must have clear title pursuant to HUD definitions.
7. Properties must be appropriately zoned.
8. Not located in flood zones.
9. Life estates are permitted under this program.
10. Property must be owned and not rented or leased.
11. All properties must be located in the unincorporated limits of the City.
J. CDBG, DRI rehab and demo/replacement activity — financing
The type of financing assistance which will be available to eligible Applicant homeowners is
known as a Deferred Payment Loan (DPL). A description of this program is outlined in the
CDBG Operational Procedures Section, as well as other places throughout this document. We
have provided summary information as follows:
1. Terms of Assistance:
A zero (0) percent interest, deferred payment loan secured by a mortgage and note. The loan
is forgivable in its entirety at the end of the term. Maximum DPL is $80,000. Additional
information is defined under Cost Feasibility and Deferred Payment Loans.
There will be a yearly write -down of the loan after the end of each applicable full year. The
write -down will be directly correlated to the amount of the mortgage. The mortgage and note
shall provide for pro -rated repayment, which shall be due if the home is sold, title is transferred
or conveyed, or the home ceases to be the primary residence of the Applicant homeowner
during the affordability period.
2. Down Payment Assistance Activity — Obiective
To provide a Deferred Payment Loan (DPL) to be utilized as down payment assistance for VLI
and LMI (up to 80% AMI) Applicants who have been approved to purchase dwelling unit under
the City CDBG/DRI program. The purpose of the program is to provide gap financing to enable
very low- and low-income households to purchase affordable standard residential. Priority will
be given to a household that lost primary housing residence due to a federally declared
disaster or has been unable to obtain decent, safe, standard affordable housing in the area as
a result of federally declared disaster.
September 2020 45
3. Down Payment Assistance Activitv — Eligibili&
a. Applicants' income must fall within the HUD Section 8 income limit guidelines as
published by HUD and/or the State of Florida for the region.
b. No member of the governing body, member of the CATF, employee of the City, or
relatives of any of these as defined by HUD and Florida Statutes, shall be eligible for
program participation unless they are granted a waiver by the US Housing and Urban
Development (HUD). The prohibition shall continue for one (1) year after an individual's
relationship with the City is terminated.
c. Priority will be given to Applicants who were forced from their homes because of a
federally declared disaster event(s) or are being forced to vacate their existing units due
to FEMA temporary living unit evacuation requirements.
K. Down Payment Assistance Activity - Construction Process
Once an Applicant has been deemed eligible for the down payment assistance activity, he/she
shall close on the loan and proceed with the following steps:
1. The Contractor will apply for and obtain all building permit(s) in the Applicant's name for
construction of the residence. Once the building permit is obtained the City will provide the
HRS with a copy of the building permit and all subcontractors' permits for the project, a full
set of Plans and Specifications for the unit the Applicant is receiving and a recorded "Notice
of Commencement" for the dwelling.
2. A Pre -Construction conference will be held between the Applicants, the City and the HRS
to review the project in detail.
3. Prior to closing, the City will provide evidence of executed loan agreements with all other
agencies that are providing financing for the construction of the dwelling unit.
4. The following documents will be executed simultaneously: An Agreement between the City
and the Applicant which allows the City to provide down payment assistance to the
Applicant in the form of a zero interest DPL. The DPL will be used to buy down the cost of
the primary mortgage and eligible down payment and closing cost. An Agreement
executed between the Applicant and the City stating that the Applicant will live in and agree
not to sell the relocation property for the duration of the DPL, is required. The DPL process
is described in more detail in the Housing Finance section of this document.
L. Down Payment Assistance Activity - Size of Units
Size of units shall be based upon the following criteria concerning the current permanent
Applicant of the existing dwelling (per 24CFR:982.401)
1. No more than two (2) person of the same sex may occupy the same bedroom.
2. Two (2) persons of the opposite sex may not occupy the same bedroom (excluding
husband and wife and very young children).
3. Only the husband, wife, dependent children (including those who are mentally and/or
physically handicapped), and family members sixty-two (62) years of age or older and
currently residing in the household will be counted in calculating family size and the
minimum number of bedrooms and square footage allowance.
M. Down Payment Assistance Activity - Down Payment Allowances
The approved Applicant of a CDBG/DRI Down Payment Assistance Activity will be eligible for
the following Disaster Recovery Initiative Program housing payment assistance maximum
amounts, subject to Application review by the HRS and PA, and subject to financial need on a
September 2020 46
case by case basis to meet down payment needs and keep the primary mortgage reasonable
and within current HUD guidelines for maximum monthly rent/mortgage cost for the household
income of the Applicant:
Family
Up to
Size
80% AMI
1
$20,000.00
2
$25,000.00
3
$30,000.00
4
$35,000.00'
5
$40,000.00
6
$40,000.00
7
$40,000.00
8
$40,000.00
The HRS and PA will review each Applicant's case and discuss with the primary lender and
Applicant the limitations of the program. The HRS will determine the amount of assistance
needed for down payment, closing and buy down of the primary note for each Applicant's
household size and income range. The HRS will recommend the amount to the PA and City
in the best interest of the program. If more funds are needed than allowed to make the
Applicant feasible to receive purchase assistance, other housing purchase assistance funds
must be obtained to meet HUD mortgage costs limits, or the Applicant will be rejected as
infeasible due to income limitations and the inability to keep the primary note within the HUD
guidelines (usually no more than thirty percent (30%) of gross income for mortgage, insurance,
taxes and other mortgage costs combined, but whatever is current at the time of Application
review will be used as a guide).
This Housing Assistance Plan and its Operational Procedures is adopted this day of
, 2020
Paul E. Carlisle, City Manager
September 2020 47
APPENDIX A — DEFINITIONS
ADA - Americans with Disabilities Act —Provides federal civil rights protection to individuals who are
physically or mentally disabled. The ADA prohibits discrimination against the disabled in employment,
public services, public accommodations, and telecommunications. Entities that are covered by the
ADA must make reasonable accommodation which involves adapting programs, facilities, or
workplaces to allow disabled individuals to participate in the program of services. (HUD's Access to
Housing for Persons with Disabilities, (202) 708-3287).
Affordability Period - The time period for which rent restrictions or resale restrictions apply to
housing that has been assisted by government funding.
Affordable Housing - Housing is considered to be affordable if monthly housing cost does not
exceed a certain percentage of a family's monthly income. The acceptable percentage is thirty (30)
percent of a family's adjusted gross monthly income.
Annual (Gross) Income - Total income (earned, unearned and asset income) anticipated to be
received by all persons who currently reside or intend to reside in a program assisted -unit for the
coming twelve (12) month period. When determining whether a household is income eligible, local
governments, participating jurisdictions and project owners must use one of the following three (3)
definitions of annual income: (1) annual income as defined at 24 CFR section 5.609 (except when
determining the income of a homeowner for an owner -occupied rehabilitation project, the value of the
homeowner's primary residence may be excluded from the calculation of net family assets); or (2)
annual income as reported under the Census long -form for the most recent available decennial
Census; or (3) adjusted gross income as defined for purposes of reporting under Internal Revenue
Service (IRS) Form 1040 series for individual federal annual income tax purposes.
Assets - Cash or non -cash item that can be converted to cash. Under most federally and state
funded housing programs, the income from an asset, either actual or imputed, is included in a family's
total household income.
Blighted structure: a structure that has substantial deterioration in which conditions are leading to
economic distress or endangerment of life, the sub -recipient jurisdiction agrees by ordinance that the
structure is blighted, and one or more of the following factors are present:
1. Unsanitary or unsafe conditions.
2. Deterioration of site or other improvement; or
3. Faulty lot layout in relation to size, adequacy, accessibility, or usefulness.
CATF: The Citizen's Advisory Task Force which the State's sub -recipient must create in order to
provide public participation and comply with citizen participation requirements.
CDBG - Community Development Block Grant - The U.S. Department of Housing and Urban
Development (HUD) administers two CDBG programs. Under the CDBG Entitlement Program, HUD
provides funds directly to urban counties and metropolitan cities based on a population- based
formula. The CDBG Small Cities Program, administered by HUD, Bureau of Community
Development, awards grants on a competitive basis to non -entitlement counties, cities, and towns in
Florida.
September 2020 48
Closing - The final procedure in a real estate sale, in which property ownership is transferred in
exchange for an agreed upon payment.
HUD — US Housing and Urban Development —DEO fulfills three major roles in developing and
implementing policy in the State of Florida which are: housing and community development,
emergency management, and resource planning and management. DEO's activities are
accomplished through the following: providing technical assistance; planning projects; administering
grant programs; reviewing plans, programs and developments; intergovernmental coordination; and,
fostering public/private partnerships.
Deed - A legal instrument that transfers property ownership from one party to another.
Deferred Payment Loan - Funds provided to a borrower under terms that calls for repayment to be
delayed for a certain length of time, until certain circumstances change, or a certain threshold is met.
In housing programs, deferred payment loans are often used as an affordability mechanism. In home
ownership programs the loans often become due when the assisted family sells the home. Under
rental programs the loans often become due if the affordability requirements are breached. In most
housing programs these loans have an interest rate of zero percent; in some communities interest
does accrue.
Demographic Data - Information about the characteristics of human populations, including size,
income, age, wealth, race, ethnicity, gender, housing conditions, etc.
Eligible Household - An individual, family or group of individuals living together as a unit, determined
to be of very low income (30%-50% of AMI), low-income (50%-not to exceed 80% of AMI) for
participation in the Small Cities CDBG and DRI programs.
Fair Housing Act - The Fair Housing Act makes it illegal to deny housing, refuse to rent, sell, or
negotiate, or offer different terms and considerations because of race, color, religion, sex, national
origin, handicap, or familial status. If you suspect violation of the Fair Housing Act or want more
information, you may contact the U.S. Department of Housing and Urban Development, Office of Fair
Housing and Equal Opportunity, 451 7th Street, SW, Washington, D.C. 20410-2000, 1-800-669-9777.
Household - Individual, family, or group of individuals living together in a unit.
HUD - U.S. Department of Housing and Urban Development - The department within the federal
government that is mandated by Congress to create conditions for every family to have decent and
affordable housing, to ensure equal housing opportunities for all, and to strengthen and enrich the
nation's communities. Offices are located at the national and state levels. HUD Locator for general
information: (202) 708-1422; Affordable housing information center: (800) 998-9999. The State
Coordinators' Office (serves South Florida): Brickell Plaza Federal Building, 909 SE First Avenue,
Room 500, Miami, Florida 33131-3028; phone: (305) 536-5678; fax: (305) 536:5765; website:
http://www.hud.gov/local/fl/working/miamioffice.cfm. The Jacksonville office (serves North and Central
Florida: 401 West Bay Street, Suite 1015, Jacksonville, Florida 32202; (904) 232-2627; fax: (904)
232-3759; web site: fl/working/jksoffice.cfm.
Lien - Recorded claim against a property whereby the property is security for a debt. Under certain
circumstances, the holder of the lien is entitled to have the property sold to satisfy the debt. A lien is
an encumbrance against the property.
September 2020 49
Low -Income Person or Household - A person or household who's annual (gross) income does not
exceed eighty percent (80%) of the Area Median Income, as determined by HUD, with adjustments
for smaller and larger families.
Median Income - A determination made through statistical methods establishing a middle point for
determining income limits. Median is the amount that divides the distribution into two equal groups:
one group having income above the median and the other group having income below the median.
Mortgage - A temporary and conditional pledge of property to a creditor as security for the repayment
of a debt. The borrower (mortgagor) retains possession and use of the property.
Reconstruction - Rebuilding of a structure, usually on the same foundation as the existing housing
which will be demolished.
Rehabilitation - The alteration, improvement or modification of an existing structure.
Section 504 - Section of the Handicapped Accessibility/Architectural Barriers Act that
Requires all public buildings to be designed, constructed, or renovated to provide access for
physically handicapped persons.
Very Low -Low -Income Person or Household - A person or household who's annual (gross)
income does not exceed fifty percent (50%) of the area median income, as determined by HUD, with
adjustments for smaller and larger families.
APPENDIX A — RESOURCES
Income Verification Resources:
htto://cortal.hud.gov/hudportal/HUD?src=/program offices/comm planning/affordablehousinq/training/web/calc
ulator/req uirements/verifyinq
Link to HUD and HOME Sample Income Verification and Contract documents:
ittD://i)ortal.hud.gov/hudportal/HUD?src=/program offices/comm planninq/affordablehousinq/library/forms
HUD income limits; (Listed from 2000 to 2013)
http://www.hud.00v/offices/cpd/affordablehousinq/programs/home/limits/income/
Section 3 and W/MBE Resources:
www.hud.ao%,
Section 3 Statute-12 U.S.C. 1701 u
Section 3 Regulation-24 CFR Part 135
Frequently Asked Questions
Section 3 Model Programs
September 2020
50
Downloadable Forms
State of Florida W/MBE directory:
ttps://vendorstrator. dms. m vflorida. com/directory
Davis Bacon Resources:
HUD Handbook 1344.1. Federal Labor Standards Compliance in Housing and Communitv Development
Proarams
Makin4 Davis -Bacon Work: A Practical Guide for States, Indian Tribes and Local Aqencies
A Contractor's Guide to Prevailing Wage Requirements
Fair Housina Link:
www.hud.gov/fairhousing
September 2020 51