HomeMy WebLinkAboutReso 1989-13941 RESOLUTION NO.13941
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA APPROVING A RENTAL REHABILITATION
PROGRA}4 DESCRIPTION AND RELATED DOCUMENTS AND
AUTHORIZING SUBMITTAL TO HUD
The City Council of the City of Chula Vista does hereby resolve as
follows:
WHEREAS, the City has been informed by the U.S. Department of
Housing and Urban Development (HUD) that funds are available for the
implementation of the HUD Rental Rehabilitation Program, which program is
aimed at improvement of substandard rental units occupied by lower income
families; and,
WHEREAS, the formula allocation for the City is $80,000.
WHEREAS, the City of Chula Vista is desirous of proving assistance
for improvement of substandard rental units occupied by lower income families;
and,
WHEREAS, eligibility and application for the available HUD funds
require that a local Rental Rehabilitation Program be designed with public
input; and,
WHEREAS, a local Rental Rehabilitation Program has been designed and
a public hearing has previously been conducted to consider that design; and,
WHEREAS, submittal documents, including a narrative Program
Description, Certifications, and a Tenant Application Policy have been
prepared and attached as Exhibits A, B, and C, respectively, and are
incorporated herein as though fully set forth.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of
Chula Vista hereby approves the Rental Rehabilitation Program description and
related documents, authorizes the Mayor to sign said documents as necessary,
and authorizes the City Manager to submit said documents to HUD.
Approved as to form by
/Thp~as J. an On
Community Development Director City Att ,~
WPC 3590H
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FEDERAL ASSISTANCE 1-20-89
Commun ~ ~ Devel opme~t Deper~men~
276 Fourth Avenue m,, ,~t~ I~w ~ ~
Chula Vista, CA 92010 Lance Abbott
(619) 691-5047
County of San Diego
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HUD
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EXHIBIT A
RENTAL REHABILITATION PROGRAM
CITY OF CHULA VISTA
PROGRAM DESCRIPTION
The City of Chula Vista will encourage and assist in the rehabilitation of
residential rental units in Chula Vista under the Rental Rehabilitation
Program authorized by the U. S. Community Development and Urban-Rural Recovery
Act of 1983. Grant and rental subsidy resources available from HUD will be
used to increase the stock of standard rental housing in the City and to
assure the affordability of such housing to lower income families. The
program has been designed to maximize both improvement assistance to
substandard rental units which will house larger families and affordability to
very low-income households.
I. PROGRAM ACTIVITIES
In FY 1988-89, the City of Chula Vista will encourage and assist in
the rehabilitation of approximately 10 rental dwelling units. The program
will be pursued by the City's existing staff responsible for the Block
Grant-funded multi-family rehabilitation program, the Community Housing
Improvement Program (CHIP). Rental projects in the tar9eted neighborhoods
will be identified for assistance consideration, using the Housing
Rehabilitation Specialist/Code Enforcement Officer and the Housing
Rehabilitation Administrator. Projects evidencing substandard conditions and
predominant occupancy by lower income tenants will be encouraged to apply for
program assistance. Proposed projects will be evaluated by the Loan Committee
of the existing CHIP Rehabilitation Program for satisfaction of program
goals. Approved projects will be referred to the Bank of America for loan
processing, for both market rate private rehabilitation loans and program
loans. Pro9ram loans will be in the form of ten-year, 0% interest deferred
loans, forgiven in full at term, but payable in full if prepaid prior to full
term or at violation of condominium conversion or assisted tenant
discrimination prohibitions. Maximum assistance will be 50% of the per unit
rehabilitation cost, to a maximum of $6,500 per unit for one bedroom units,
$7,500 per unit for two bedroom units, and $8,500 per unit for units with
three or more units. Program loans and attendant prohibitions will be secured
by a lien on the subject property. Matching private investment will be
accomplished where possible by the underwriting of private property
improvement loans by the Bank of America. Affected eligible tenants will
receive Section 8 Existing rental subsidies from the Public Housing
Authority. Affected lower income tenants not suitably housed in rehabilitated
units will receive technical and financial relocation assistance from program
funds.
Two staff members will be working on the Rental Rehabilitation
Program, Tony Ciotti and Roger Jones. Mr. Ciotti has been the City's Housing
Rehabilitation Coordinator for 11 years and has been certified by NAHRO as a
Rehabilitation Finance Specialist. He has primary responsibility for the
administration and execution of the program. Roger Jones is the City's
Housing Rehabilitation Specialist and is certified by NAHRO as a
Rehabilitation Construction Specialist. He conducts the initial inspections
to determine Code violations and items in need of rehabilitation.
II. NEIGHBORHOOD SELECTION
The Rental Rehabilitation Program will be operated in the CHIP target
neighborhoods. These neighborhoods are among the lowest income neighborhoods
in the City, with 1980 Census data indicating that the median income in the
Census Tracts these neighborhoods comprise is below 80% of the area median
income. These neighborhoods are a mix of single-family and multi-family
units, with the great majority of rental rates being below prevailing market
rates in Chula Vista and below the current Section 8 Existing Fair Market
Rents. Community Development Block Grant-funded Housing Rehabilitation and
Capital Improvement activities, and redevelopment of the adjacent downtown
commercial section, promise to revitalize these declining neighborhoods, but
the modest nature of the housing stock and the scope of the revitalization
activities will not result in gentrification of the neighborhoods. Rent
levels will rise over the next five years, but not at as great a rate as rents
in the market area.
Selection of these neighborhoods is based on 1980 Census data, A Housing Study
for the City of Chula Vista, dated May 1984, and field observation.
III. LOWER INCOME BENEFIT
A minimum of 70% of the rental rehabilitation grant will be used to
assist lower income families. One-hundred percent lower income benefit will
be striven for, but achieving that level is unlikely. No neighborhoods in
Chula Vista are so significantly lower income, and no rental projects are so
significantly substandard, that more than 70% low income occupancy of a rental
project would likely be encountered. If 100% lower income occupancy were
necessary, significant numbers of non-lower income families would have to be
displaced by the property owner/applicant, which the City feel s is an
unacceptable circumstance. Given the characteristics of the Chula Vista
neighborhoods and the displacement which would result, no practical program
design exists which could achieve 100% low income benefit level. Through the
ublic hearing process to consider the program description, the public has
~een consulted regarding the inability to achieve a 100% lower income benefit
level.
IV. USE OF RENTAL REHABILITATION GRANTS FOR HOUSING FOR FAMILIES
A minimum of 70% of the units assisted under the program will be
two-bedroom or larger. First priority for assistance will go to three bedroom
units. As apartment projects in Chula Vista seldom contain three bedroom
units, outreach will be concentrated on rental duplexes. All assistance given
under the program will be approved by the City's CHIP Loan Committee, using as
one of their criteria for project selection the goal of a minimum of 70% total
program assistance to units of two bedrooms or larger and highest priority to
three-bedroom units.
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V. USE OF RENTAL REHABILITATION GRANTS FOR UNITS IN SUBSTANDARD
CONDITION THAT ARE OCCUPIED BY VERY LOW-INCOME FAMILIES
Priority will be given to projects with substandard units occupied by
very low-income families. All assistance given under the program will be
approved by the City's CHIP Loan Committee, using as one of their criteria for
project selection the priority to projects with substandard units occupied by
very low-income families.
VI. SELECTION OF PROPOSALS
Proposals will be selected by the CHIP Loan Committee based on the
following criteria:
a. Correction of substandard units, especially those occupied by
very low-income families.
b. Predominance of assistance to large families in lower-income
categories, with a minimum of 70% of all units assisted being
two bedrooms or larger, and with highest priority going to
three-bedroom units.
c. Maximum stimulation of private investment.
d. Minimization of displacement of tenants.
The Loan Committee will also evaluate the pro forma and loan
processing information in order to select financially feasible projects with
maximum program benefit. Operating income and replacement reserve levels will
be considered. The Loan Committee will consider the distribution of Section 8
Existing Vouchers to a project or the provision of financial relocation
assistance in their evaluation of program benefit. Relocation expenses paid
to project unit displacees will be deducted from the per unit maximum
assistance levels.
VII. FINANCIAL FEASIBILITY
The Rental Rehabilitation Program will be financially feasible.
Private funds will be available through private lending institutions, with
lending services for both program deferred loans and private loans obtained
from Bank of America.
VIII. NEIGHBORHOOD PRESERVATION
Neighborhood preservation is currently under way in the target
neighborhood, using Block Grant-funded housing rehabilitation, Block
Grant-funded Capital Improvement Projects, and Block Grant-funded social
service activities. Additional property improvement under the program could
only enhance that neighborhood preservation.
-3-
IX. SCHEDULE FOR COMNITTING RENTAL REHABILITATION GRANT AMOUNTS
Specific projects have not yet been selected for the program, but as
the City runs an existing Block Grant-funded multi-family rehabilitation
program, projects suitable for this program can be easily identified. All
staff and mechanisms for processing and approving loans are in place.
Our best local estimate is that the average subsidy per unit will be
approximately $7,500. That means that the program would rehabilitate
approximately 10 units in 12 months. As it would be most advantageous for the
Loan Committee to evaluate a number of project proposals simultaneously,
project proposals will be batched for consideration. By March 1989, we would
anticipate committing funds to approximately 5 units at that point. That
commitment would be $37,500, or 45% of our 1989-90 grant funds. The total
grant amount should be committed by September of 1990.
X. HEED FOR RENTAL HOUSING ASSISTANCE.
Not applicable.
XI. NON-DISCRIMINATION AND EQUAL OPPORTUNITY
Affirmative marketing and fair housing principles will be pursued by
the program. The program will not participate in unit marketing, but property
owners will be counseled in affirmative marketing principles and monitored for
compliance.
The City will provide fair housing counseling to owners of assisted
units and to perspective tenants. The following steps will be taken:
a. Written material on Federal Fair Housing Laws will be
distributed to owners and tenants. All advertisements or public
announcements regarding the program will include the Equal
Housing Opportunity logo.
b. Each unit assisted through the Rental Rehabilitation Program
will be marketed in a manner to affirmatively further fair
housin9, including but not limited to the following:
l) Listing available units with the Section 8 Existing
Marketing Section of the Housing Authority.
2) Attempting to fill vacant units with families who are
active certificate holders through the Section 8 program,
or who are applicants on the waiting list for Section 8
certificates or vouchers.
3) Using the Equal Housing Opportunity logo in any newspaper
advertisement or written communication to community groups,
organizations, agencies, or other community contacts.
Owners will utilize various community contacts to advertise unit
availability to those persons in the housing market area least likely to apply
for the unit. Applications will be solicited from such individuals.
The City will gather and maintain records to demonstrate compliance
as follows:
a. Copies of all written material regarding vacant units for rent
will be kept by the property owner and by the City. Records
will be kept of applications received in response to available
vacancies.
b. The City will periodically review affirmative marketing efforts
made by owners to ensure compliance with Equal Housing
Opportunity provisions. Where an owner has failed te follow
affirmative marketing requirements, appropriate actions,
available under program regulations and/or applicable laws, will
be taken to enforce conformity. In cases where housing
discrimination is established to have occurred, such established
housing discrimination shall be a condition of default on
program deferred loans.
Owners will be encouraged to comply with provisions of affirmative
marketing of the units for no less than seven years after the completion date
of rehabilitation of all units in the project.
XII. GRANTEE ORGANIZATIONAL STRUCTURE
The Pental Rehabilitation Program contact person for the City of
Chula Vista is: David Gustafson, Assistant Community Development Director,
City of Chula Vista, 276 Fourth Avenue, Chula Vista, CA 92010.
XIII. PUBLIC HOUSING AUTHORITY PARTICIPATION
The Housing Authority of the County of San Diego has applied to HUD
for Section 8 Existing Vouchers to provide to the City Rental Rehabilitation
Program. A Memorandum of Understanding for the administration of these
certificates has been executed between the City and the Housing Authority.
The Section 8 Existing Pental Rehabilitation Program contact person
is: Josephine Silva, Chief, Housing Pro9rams, Housing Authority of the County
of San Diego, 7917 Ostrow Street, San Diego, CA 92111-3694, at 694-4803.
XIV. CERTIFICATIONS
The necessary certifications are attached. They were approved by
City Council Resolution for FY 1987-88 fundin9 on January 17, 1989.
-5-
XV. RECENT REHABILITATION ACTIVITIES
The City offers loans and grants for the rehabilitation of rental
units, owner occupied single family dwellings, and mobilehomes. The following
chart shows the number of units rehabilitated and the amount of funds spent
over the past 3 fiscal years.
CITY OF CHULA VISTA
HOUSING REHABILITATION
FISCAL YEARS 1985-88
FY 1985-86
No. of Single Family Dwellings 27
No. of Mobilehomes 24
Total Funds Spent $399,422.00
FY 1986-87
No. of Single Family Dwellings 24
No. of Mobilehomes 31
Total Funds Spent $591,129.00
FY 1987-88
_ No. of Single Family Dwellings 34
No. of Mobilehomes 13
Total Funds Spent $980,508.65
FY 1988-89 (through December)
No. of Single Family Dwellings 21
No. of Mobilehomes 15
Total Funds Spent $569,346.77
WPC 3914H
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RENTAL REHABILITATION PROGRAM
CERTIFICATIONS
The grantee certifies that:
(1) The submission of this Program Description is authorized under State
and local law las applicable), and the grantee possesses the legal
authority to carry out the Rental Rehabilitation Program described
herein, in accordance with 24 CFR Part 511;
(2) The grantee's Rental Rehabilitation Program was developed after
consultation with the public and its description of program
activities in the "Program Activities" section of this Program
Description has been made available to the public;
(3) X (Check if this paragraph is applicable.)
The grantee's lower income benefit standard is hereby reduced to 70
percent as provided by 24 CFR 511.10(a)(2). The discussion of lower
income benefit in this Program Description contains a specific
explanation of the reasons why this reduced benefit standard is
necessary, which explanation complies with 24 CFR 511.10(a)(2).
(4) The grantee has adopted a written tenant assistance policy conforming
to the requirements of 24 CFR 511.10(h)(2), and such policy will be
- made available to the public on request;
(5) The grantee will conduct and administer its Rental Rehabilitation
Program, and, if applicable ensure that State recipients conduct and
administer their Rental Rehabilitation Programs, in conformity with
the requirements of 24 CFR 511.10(m); and
(6) The grantee will conduct and administer its Rental Rehabilitation
Program, and, if applicable, ensure that State recipients conduct and
administer their Rental Rehabilitation Programs, in accordance with
the requirements of 24 CFR Part 511.
WPC 3915H
RENTAL REHABILITATION PROGRAM TENANT ASSISTANCE POLICY
I. INTENT
The Chula Vista Rental Rehabilitation Program will seek to minimize
permanent displacement of residential rental tenants as a result of
program activities. In cases where permanent displacement of low income
families, (less than 80% of median income) is unavoidable, financial and
technical relocation assistance will be provided to those families.
Very low-income families (less than 50% of median income) will not be
permanently displaced in favor of non very low-income families. Cost
and assistance needs resulting from temporary displacement of tenants
during property improvement will be the responsibility of the property
owner and will not be paid from program funds.
The Rental Rehabilitation Program will be administered so as to not
cause the displacement of persons because of their particular, race,
color, religion, sex, age, handicap, or natural origin.
II. DEFINITIONS OF DISPLACEMENT
A. Non low-income families moving from a unit undergoing
rehabilitation under the program will not be considered displacees
under the Tenant Assistance Program:
B. Low-income and very low-income families will be considered
displacees if their displacement is a direct result of program
activity and not an action for cause.
C. Examples: of program related displacement include, but are not
limited to, unit underutilization, unit overcrowding, housing cost
overpayment (family paying more than 30% of monthly gross income
for housing expenses), or tenant ineligibility to Section 8.
Existing rental subsidy assistance as a result of unit rent
exceeding Section 8 Fair Market Rent. No tenant will be considered
displaced if the tenant has been offered a decent, safe, and
sanitary dwelling unit in the project at an affordable rent.
Qualification as displacees will be solely determined by the City.
III. ASSISTANCE TO DISPLACEES
A. Displacees will receive either Section 8 rental subsidy assistance,
or relocation assistance under the provisions for permanent
displacement of the U.S. Uniform Relocation Assistance and Property
Acquisition Act of 1970, at the option of the City. Provisions of
the Act include technical assistance, moving allowances, and rental
differential payments. Displacees receiving Section 8 certificates
will also be eligible for technical assistance and moving
allowances.
B. Technical assistance will include information and counseling to
familiarize displacees with opportunities to select appropriate
- replacement housing within the full range of available housing,
with individual rights under the federal Fair Housing Law, and with
methods for searching for suitable replacement housing.
C. No displacees will be discriminated against in the provision of
information, counseling, referrals, or other relocation services.
~4Z'/ WPC 3915H R-I~?~I
ADOPTED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF
Ch,..,_A VISTA, CALIFORNIA, this 17th day of January
19 89 , by the following vote, to-wit:
AYES: C0uncilmembers McCandiliss, Nader, Malcolm, Moore
NAYES: Councilmembers None
ABSTAIN: Councilmembers None
Cox
ABSENT: Counci 1 members
C'~f Chula Vista
ATTES ,, City Clerk
S1. ~ OF CALIFORNIA )
COUNTY OF SAN DIEGO ) ss.
CITY OF CHULA VISTA )
I, JENNIE M. FULASZ, CMC, CITY CLERK of the City of Chulo Vista, California,
DO HEREBY CERTIFY that the above and foregoing is o full, true and correct copy of
RESOLUTION NO, 13941 ,and that the same hos not been amended or repealed
DATED
City Clerk
CC-660