CITY OF CHANDLER IGA HOME AMENDMENT 2.PDF
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Contract No. C-22-17-048-3-02 Amendment No. 2 AMENDMENT TO THE INTERGOVERNMENTAL AGREEMENT BETWEEN MARICOPA COUNTY ADMINISTERED BY ITS HUMAN SERVICES DEPARTMENT AND CITY OF CHANDLER I. Maricopa County (“County”) administered by its Human Services Department and the City of Chandler (“City”) entered into a financial Intergovernmental Agreement (“Agreement”) on or about February 15, 2017. The purpose of the Agreement is for the City to provide single family owner occupied housing reconstruction and a tenant based rental assistance program. The County provided the City with $299,853 in 2016 HOME Investment Partnerships Program (HOME) funds from the U.S. Department of Housing and Urban Development (HUD). The County and the City may be referred to individually as “Party” or collectively as “Parties.” The Parties executed Amendment No. 1 on or about February 13, 2018 to add 2017 Work Statements for a Community Land Trust program for the City to acquire, rehabilitate and resell a single family home and for expansion of the tenant based rental assistance and administration programs. The County provided the City with $298,870 for the 2017 Work Statements. Upon approval of Amendment No. 1, the Agreement funding amount increased to $598,723. II. The Parties wish to amend the Agreement as follows (Amendment No. 2): A. Add additional Work Statements hereinafter referred to as “2018 Work Statement A” for the City to acquire, rehabilitate and resell a single family home . The County will provide the City with $189,473 in 2018 HOME funds. The expenditure term for this Work Statement shall expire on September 30, 2022. B. Add additional Work Statements hereinafter referred to as “2018 Work Statement B” for the City to provide tenant based rental assistance. The County will provided the City with $232,484 in 2018 HOME funds. The expenditure term for this Work Statement shall expire on September 30, 2022. C. Funding amount for the 2018 Work Statements shall not exceed $421,957. D. All work performed or costs incurred or expended under the previously approved 2016 Work Statements in the amount of $299,853 shall remain reimbursable under the terms of the original Agreement through September 30, 2019. All work performed or costs incurred or expended under the previously approved 2017 Work Statements in the amount of $298,870 shall remain reimbursable through September 30, 2021. E. Upon approval of Amendment No. 2, the Agreement funding amount shall be increased to $1,020,680. F. Section IV, Compensation, Subsection D, Reimbursement shall be amended to reference total funding of $1,020,680. III. This Agreement is subject to A.R.S. §38-511. The foregoing paragraphs contain all the changes made by this Amendment. All other terms and conditions of the original Agreement remain the same and in full force and effect as approved and amended. Contract No. C-22-17-048-3-02 Amendment No. 2 IN WITNESS THEREOF, the Parties have signed this Amendment: APPROVED BY: APPROVED BY: CITY OF CHANDLER MARICOPA COUNTY ___________________________________ ____________________________________ Chairman, Board of Supervisors Date: __________________________ Date: __________________________ Attested To: Attested To: ____________________________________ ____________________________________ City Clerk Fran McCarroll, Clerk of the Board IN ACCORDANCE WITH A.R.S. §§ 11-952, 11-201, AND 11-251, THIS AGREEMENT HAS BEEN REVIEWED BY THE UNDERSIGNED DEPUTY COUNTY ATTORNEY, AND, IN ACCORDANCE WITH A.R.S. § 11-952, THIS AGREEMENT HAS BEEN REVIEWED BY THE UNDERSIGNED ATTORNEY FOR CITY ON BEHALF OF CITY, AND, AS TO THEIR RESPECTIVE CLIENTS ONLY, EACH ATTORNEY HAS DETERMINED THAT THIS AGREEMENT IS IN PROPER FORM AND WITHIN THE POWER AND AUTHORITY GRANTED UNDER THE LAWS OF THE STATE OF ARIZONA. CITY OF CHANDLER MARICOPA COUNTY BY: ______________________________ BY: ______________________________ City Attorney Deputy County Attorney Date: __________________________ Date: __________________________ C-22-17-048-3-02 2018 Work Statement A MARICOPA COUNTY HOME Investment Partnerships Program Work Statement Project: Newtown Community Land Trust Acquisition/Resale Program Year 2018 HOME Funds: $189,473 Type of Property: Single Family Residential Amount of Funding OTHER HOME CASH MATCH TOTAL RESOURCES AMOUNT AMOUNT BUDGET AMOUNT $189,473 $75,927 $265,400 Work Statement The City of Chandler will contract with Newtown Community Development Corporation (Newtown CDC), acting in the capacity of a Community Housing Development Corporation (CHDO) developer to acquire and rehabilitate a single-family home in Chandler. The project is a scattered-site homeownership project which target specific zip codes: 85224, 85225, and 85226 to be supplemented by the specific street address. The Parties shall execute an Addendum, once a property is identified. The Addendum shall identify the individual property by street address for participation in the Newtown CDC Community Land Trust Program (CLT) will be executed before funding is made available. Funds will be considered to be committed only after requirements of the HOME Investment Partnerships Program rules are met under the definition of commitment which includes: all funding necessary for the project is secured, a budget and schedule are established, underwriting and subsidy layering is completed, construction is scheduled to begin within twelve months and the individual address for acquisition is identified. Funds for rehabilitation are obligated by completing a detailed set of plans and specifications (work write-up) and completing a detailed construction/rehabilitation cost estimate based upon those specifications. Such cost estimate may include a contingency for construction change orders of up to 15% for rehabilitation and up to 5% for new construction. The property must be free from any defects that pose a danger to the health and safety of occupants, and must meet written rehabilitation standards and local codes and ordinances at project completion. Copies of final inspection must be retained in the project files and submitted to the County upon submitting completion report. The completed home will be sold to an eligible low-income first-time homebuyer. The property will be acquired with Newtown’s line of credit, following completion of environmental review requirements. Newtown CDC will execute a Deed of Trust and Note naming the City of Chandler as Beneficiary in order to secure any funds provided to Newtown CDC as reimbursement for acquisition costs. Resale provisions will be used to ensure compliance with the period of affordability required by HUD at 92.254 of the HOME regulation. The affordability restrictions will be secured by a Community Land Trust (CLT) Ground Lease and a Declaration of Affirmative Land Use Restrictions. The completed unit shall be sold through the Newtown (CLT) program in which the buyer purchases the improvements only and enters into a 99-year CLT Ground Lease with Newtown CDC. The CLT Ground Lease contains provisions that require the housing to be used as the buyer’s principal residence and restricts resale/transfer only to Low-Income buyers. In addition, the CLT Ground Lease has a shared-appreciation provision that limits the sale price of the housing and helps ensure affordability for future buyers. A Memorandum of Ground Lease and Right of First Refusal are recorded. A “Performance” Deed of Trust is C-22-17-048-3-02 2018 Work Statement A also recorded with the Newtown CDC as the beneficiary; this ensures the Newtown CDC is notified in the event the owner of the improvements attempts to refinance or transfer the property. The shared appreciation provision conforms to Maricopa HOME Consortium Recapture / Resale Provisions: “Fair Return” for leasehold properties is defined as the lessees purchase price, plus 25% of the lessee’s share of the increase in leasehold value at time of resale based on a leasehold valuation performed by a duly licensed appraiser. Declaration of Affirmative Land Use Restrictions: Upon sale to an eligible buyer, a Declaration of Affirmative Land Use Restrictive Covenant for HOME Project is executed between the Administrator and Newtown CDC and recorded against the land to secure the Period of Affordability as required by HUD. The Period of Affordability is based on the total amount of HOME funds invested in the housing. Eligible buyers will be required to complete an approved homebuyer education class and homeownership counseling. Eligible buyers will also be required to complete a Community Land Trust (CLT) orientation, at which time the ground lease, resale restrictions, shared equity and all other provisions of the CLT program are fully explained. Beneficiaries: One (1) first time homebuyer at or below 80% of the area median income level. Newtown CDC will secure affordability through the Resale Provisions. The City shall ensure the beneficiaries are income eligible and comply with 24 CFR 92.203(d)(1). Consolidated Plan – Project will increase the supply of affordable rental units for low and very low income households. High priority rated in the Consolidated Plan. A. OBJECTIVES AND OUTCOMES: OUTCOMES OBJECTIVE AVAILABILITY/ ACCESSIBILITY AFFORDABILITY SUSTAINABILITY DECENT Single Family Homebuyer Activities, Housing Rehab and Acquisition/Rehab of rental housing, Housing Activities in a HOUSING Emergency Rehab; Acquisition/New Construction of rental targeted revitalization Homebuyer housing, TBRA, Expansion of assisted area Assistance rental units B. LOGIC MODEL: PERFORMANCE INDICATORS The City of Chandler will partner with Newtown CDC to acquire and rehabilitate one home which will be sold to a low or moderate homeowner using a Community Land Trust Model. The outcome will be increased affordable housing for low to moderate income families as well as to increase homeownership, provide decent housing, improve neighborhoods and quality of life. C. SITE INFORMATION: Scattered sites in Chandler. Parties will execute addenda to this agreement when specific parcels are identified. D. PERFORMANCE REPORTING - GOALS: Project Completion date: September 30, 2021 C-22-17-048-3-02 2018 Work Statement A E. TIMELINE OF ACTIVITIES START COMPLETION MILESTONES: Tasks to be Performed DATE DATE Application/market study 11/2017 11/2017 Site selection 12/1/2018 6/30/19 Environmental reviews to City of Chandler 12/1/18 6/20/19 Homeownership counseling/buyer preparation 7/1/18 9/30/2019 Acquisition 12/15/18 9/30/2019 Work write-ups and bid selection 12/15/18 9/30/2019 Homebuyer financing secured 12/1/18 9/30/2019 Rehabilitation 12/30/18 9/30/2019 Resale of properties to homeowners 1/15/19 9/30/19 Final Close-out /Project Completion Form 10/31/2019 Any change to the Timeline will need to be approved by the County. F. ACTIVITY FOLLOW-UP AND LONG TERM COMMITMENT: The HOME unit will have a period of affordability of 15 years. During this time, the project will be monitored annually and the unit will be verified annually. The affordability standard is applied to both the original homebuyer and subsequent purchaser and will be enforced by imposing deed restrictions, covenants running with the land, or other similar mechanisms. G. ACTIVITY BUDGET SUMMARY: 2018 TOTAL ACTIVITY CASH Additional HOME PI and Recapture ACTIVITY MATCH Resources AMOUNT BUDGET Acquisition (b) 189,473 22,927 212,400 Rehabilitation Down payment assistance 25,000 25,000 Relocation Development Costs (a) 9,000 9,000 Staff Costs (a) Services (a) Development Fees 19,000 19,000 Other (LBP, title, appraisal) TOTALS $189,473 $75,927 $265,400 (a) These costs must be address specific; otherwise, these costs must be considered administrative costs. (b) $2,500 per activity/property will be withheld from the total amount of HOME funds obligated to each activity/address until a completion form is submitted by Newtown CDC. C-22-17-048-3-02 2018 Work Statement A H. ACTIVITY MATCH: AMOUNT FORM OF MATCH $47,468.25 IDA Funds I. SALES PRICE: To ensure the home is affordable for the target income groups, the sales prices shall be calculated so that the Buyers' monthly housing expenses are 28% of their gross monthly household income. Monthly housing expenses include principal, interest, property taxes, home insurance, HOA fees, and monthly ground lease fees. Buyers' monthly housing expenses must be at least 24% and not exceed 33% of Buyer's gross monthly household income; unless there are documented compensating factors. Homebuyers may obtain only mortgage loans with a fixed term and interest rate; lender fees may not exceed 5% of the mortgage amount. The income of buyers shall be determined according to the requirements at 92.203. In addition, the property will have an estimated value after rehabilitation that does not exceed 95 percent of the median purchase price for the area as described in 24 CFR 92.254(a)(2)(iii). J. CHDO PROJECT PROCEEDS: All proceeds generated from CHDO development activities shall be considered project proceeds and subject to the project proceeds requirements set forth in HOME Program regulations. Project proceeds shall be tracked by the CHDO. Documentation supporting the amount of project proceeds received and expended shall be submitted on the periodic progress report, if requested by the County. Project proceeds shall be retained and expended by the CHDO for acquisition and/or rehabilitation of additional properties under this agreement. K. CONVERSION TO RENTAL: Any HOME homebuyer units that have not been sold to an eligible homebuyer within nine (9) months of receipt of a Certificate of Occupancy must be converted to a HOME rental unit that complies with all HOME requirements for the period of affordability applicable to such rental units, according to 24 CFR 92.254(a)(3). If the vacant property is not converted, HOME funds must be repaid to the County. L. AFFORDABILITY REQUIREMENTS: 1. The housing that is acquired with HOME funds must be single family housing. The family or individual acquiring the housing must qualify as Low Income and maintain the housing as the principal residence throughout the Period of Affordability, which shall be for a period of 15 years in accordance with HOME program requirements. 2. Resale provisions (Attachment D) will be used to ensure compliance with the period of affordability required by HUD at 92.254 of the HOME regulation. The affordability restrictions will be secured by a Community Land Trust (CLT) Ground Lease and a Declaration of Affirmative Land Use Restrictions and a Deed of Trust. a.) CLT Ground Lease. Completed units shall be sold through Newtown’s Community Land Trust (CLT) program in which the buyer purchases the improvements only and enters into a 99-year CLT Ground Lease with Newtown CDC. The CLT Ground Lease contains provisions that require the housing to be used as the buyer’s principal residence and restricts C-22-17-048-3-02 2018 Work Statement A resale to only Low-Income buyers. In addition, the CLT Ground Lease has a shared- appreciation provision that limits the sale price of the housing and helps ensure affordability for future buyers. A Memorandum of Ground Lease and Right of First Refusal are recorded. A “Performance” Deed of Trust is also recorded with Newtown CDC as the beneficiary; this ensures Newtown CDC is notified in the event the owner of the improvements attempts to refinance or transfer the property. b.) Declaration of Affirmative Land Use Restrictions. Upon sale to an eligible buyer, a Declaration of Affirmative Land Use Restrictions is executed between the Administrator and Newtown CDC and recorded against the land to secure the Period of Affordability as required by HUD. The Period of Affordability is based on the total amount of HOME funds invested in the housing. c.) Deed of Trust. Upon sale to an eligible buyer, a Deed of Trust is executed between the Administrator and Newtown CDC and recorded against the land to secure the Period of Affordability as required by HUD. The Period of Affordability is based on the total amount of HOME funds invested in the housing. C-22-17-048-3-02 2018 Work Statement B MARICOPA COUNTY HOME Investment Partnerships Program 2018 Work Statement B Consortium Member: City of Chandler, Arizona Project: Tenant Based Rental Assistance and HOME Administration Program Year 2018 HOME Funds: $206,112 (Entitlement funds); and $26,372 (Administrative funds) Program income and recapture funds: $62,812.19 Type of Property: Rental A. DETAILED SCOPE OF WORK: Include the following- 1. Consolidated Plan goals as it relates to this activity, include the priority rating i.e. High, Low High 2. Type of assistance/activity to be provided with HOME funds: Tenant Based Rental Assistance Administration 3. Methods and instruments used for ensuring affordability: Recapture provision (insert description of how the funds will be recaptured i.e. paid in full, pro-rated etc.) Not applicable to this activity. 4. Anticipated use of program income/project proceeds: This activity does not generate program income. B. OBJECTIVES AND OUTCOMES (Check appropriate box below.): OUTCOMES OBJECTIVE AVAILABILITY/ AFFORDABILITY SUSTAINABILITY ACCESSIBILITY Homebuyer Activities, DECENT Single Family Acquisition/Rehab of rental housing, Housing Activities in a HOUSING Housing Rehab and Acquisition/New Construction of rental targeted revitalization Emergency Rehab housing, TBRA, Expansion of assisted area rental units C. LOGIC MODEL: PERFORMANCE INDICATORS: The City of Chandler Housing and Redevelopment Division will administer the Tenant Based Rental Assistance Program. Through this effort, homelessness will be prevented by providing decent, affordable rental housing for families in need. This will result in self-sufficiency and housing stabilization, as well as an understanding of the underlying issues that contributed to loss of housing. C-22-17-048-3-02 2018 Work Statement B D. PROPOSED BENEFICIARIES: Targeted Population by Number of Total Number Number of Income Level Households of Units HOME Assisted Units in program (if rental) Households at or below 50% 20 Households at or below 60% Households at or below 80% TOTAL 20 E. PRIORITY POPULATIONS: Complete the table below only if the Activity will specifically set-aside units for a priority population. Set-asides will be enforced through contract provisions. Priority Populations No. of Units Elderly Physically Disabled Other Priority Populations: Veterans Homeless 20 F. PERFORMANCE REPORTING GOALS-TIMELINE OF ACTIVITIES: START COMPLETION TBRA MILESTONES DATE DATE September 13, HOME Contract Amendment signed by City Council 2018 Signed MOA between City of Chandler Neighborhood Resources/CD and Housing and Redevelopment Division October 2018 August 2018 September 13, Environmental Program Clearance 2018 October 2018 September 30, Application Intake-Certification of Income Eligibility 2022 October 2018 September 30, Application Review 2022 Prior to leasing throughout September 30, Initial HQS Property Inspection Contract Term 2022 Home Set up Report to County October 2018 October 2018 Unit Occupied by Low/Moderate Income Throughout September 30, Person/Family Contract Term 2022 Completion Report submitted to City July 31, 2022 September 30, 2022 Any change to the Timeline will need to be submitted to and approved by Maricopa County. C-22-17-048-3-02 2018 Work Statement B G. ACTIVITY BUDGET SUMMARY: TBRA ACTIVITIES HOME HOME TOTAL FUNDS Program Income COST Program Year and Recaptured 2018 Funds RENTAL COSTS Monthly Rent** – $206,112 $62,812.19 Utility Costs Security Deposit Assistance Utility Deposit Assistance HOME ADMINISTRATION* $26,372 TOTAL FUNDING $232,484 $62,812.19 $268,924.19 *Administration funds to be expended by the City of Chandler for overall HOME program administration. **Monthly rent (includes one-time security and utility deposit, as needed, for each participating household) H. MATCH: IDENTIFY MATCH SOURCES AND AMOUNTS THAT HAVE BEEN COMMITTED TO THE PROJECT: Match commitment must equal 25% of the HOME funds requested. Documentation is due at the time of request for payment(s). Match Logs must be submitted annually by June 30th of each year. SOURCE/FUNDING TYPE AGENCY TOTAL Cash or cash equivalents from a non-federal source (City of $51,528 $51,528 Chandler General Funds)