HomeMy WebLinkAboutPR 22526: APPROVAL OF THE HURRICANE HARVEY ACQUISTION HOUSING GUIDELINES Allille
City of �- ;
€J4exas
INTEROFFICE MEMORANDUM
Date: April 25,2022
To: The Honorable Mayor and City Council
Through: Ronald Burton, City Manager
From: Pamela Langford, Assistant City Managers fQ
RE: P. R. # 22526
Introduction:
The intent of this Agenda Item is to seek the City Council's approval of P. R. #22526 which
approves the Hurricane Harvey Acquisition Housing Guidelines.
Background:
The Texas General Land Office has allocated $4,207,067.91 to the City of Port Arthur to develop
an Acquisition Program.
The Acquisition Program is designed to assist homeowners that are currently located in the
existing or proposed floodplain, floodway, or potential Disaster Risk Reduction Areas(DRRA)
to relocate to an area that is less prone to flooding and disaster.
The goals of the program are to:
• Reduce the risk to homeowners from the effects of subsequent disasters.
• Assist in the recovery of low to moderate-income households.
• Protect taxpayer resources that might otherwise be needed after a disaster in the same
area.
The purpose of the City of Port Arthur DR-4332 Local Acquisition Guidelines is to aid in the
long-term recovery efforts by encouraging families who face a risk to health and safety due to
hazards created by Hurricane Harvey to permanently relocate to areas outside of the floodplain,
floodway,or Disaster Risk Reduction area(if deemed applicable).
Budget Impact:
Account number#159-13-031-5470-00-10-000; PROJECT#GL0000.
Recommendation:
It is recommended that City Council approve P. R. #22526 as discussed above.
P. R. #22526
04/20/2022- MEE
Page 1
RESOLUTION NUMBER
A RESOLUTION AUTHORIZING THE ADOPTION OF THE CITY OF
PORT ARTHUR DR-4332 (HURRICANE HARVEY) LOCAL
ACQUISITION PROGRAM GUIDELINES.
WHEREAS, The Texas General Land Office has allocated $4,207,067.91 to the City of
Port Arthur for the Acquisition Program under the Community Development Block Grant Disaster
Recovery (TX-DR-4332); and,
WHEREAS, the Acquisition Program allows the City to acquire approximately twenty-
two (22) properties damaged during Hurricane Harvey or located within a disaster risk reduction
area. The Program will relocate homeowners and their families to low-risk areas outside of the
floodplain/floodway and assist qualified applicants in moving/relocation expenses; and,
WHEREAS, the purpose of the City of Port Arthur DR-4332 Local Acquisition
Guidelines is to aid in the long-term recovery efforts by encouraging families who face a risk to
health and safety due to hazards created by Hurricane Harvey to permanently relocate to area
outside of the floodplain, floodway, or Disaster Risk Reduction area(if deemed applicable); and,
WHEREAS, the City Manager is authorized to implement the City of Port Arthur DR-
4332 Local Acquisition Program Guidelines attached hereto in substantially the same form as
Exhibit"A".
NOW THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
PORT ARTHUR:
Section 1. That the facts and opinions in the preamble are true and correct.
Section 2. That the City Council hereby approves the Acquisition Housing Guidelines.
P. R. # 22526
04/20/2022- MEE
Page 2
Section 3. That the City Manager is authorized to implement the City of Port Arthur DR-
4332 Local Acquisition Program Guidelines attached hereto in substantially the same form as
Exhibit "A".
Section 4. That a copy of the caption of this Resolution be spread upon the minutes of the
City Council.
READ, ADOPTED AND APPROVED this day of
A. D., 2022 at a Regular Meeting of the City Council of the City of Port
Arthur, Texas by the following vote: AYES:
MAYOR:
NOES: •
THURMAN "BILL" BARTIE
MAYOR
ATTEST:
SHERRI BELLARD
CITY SECRETARY
APPROVED FOR FORM:
e11) I tibANAlqi
TIZ
CI Y ATT ' EY
P. R. #22526
04/20/2022-MEE
Page 3
APPROVED FOR ADMINISTRATIO ippV
R• A P BUR -: • , CITY AN r�7' Vr
Rivre c I
I . CO
PAMELA LANGFORD, AS STAN CITY MANAGER
c
KANDY DA IELS
INTERIM FINANCE DIRECTOR
P. R. #22526
04/20/2022- MEE
Page 4
EXHIBIT "A"
CITY OF PORT ARTHUR I�
DR-4332
City of Port Arthur
Local Acquisition Program
Community Development and
Revitalization
DR-4332 City of Port Arthur Local Acquisition
Program
Introduction
The General Land Office(GLO),City of Port Arthur,and Long-Term Recovery
As a result of Hurricane Harvey(TX-DR-4332),the City of Port Arthur received over 26 inches
of rainfall on August 30, 2017,and total rainfall of 47.99 inches during the period between
August 24,2017 and August 30,2017. At times,rainfall averaged 3.87 inches per hour. Streets,
homes and businesses throughout the City were inundated with water. Thousands of residents
were trapped in their homes while thousands of others had to be rescued from rooftops,the tops
of vehicles and even emergency shelters.During the disaster event,residents suffered an
• immediate threat to public health and safety. Emergency responders could not offer support,as
roads were impassable. It is estimated that 8o%of the City's housing suffered at least minor
damage as a result of the flooding.
In April, 2018, the City commissioned a comprehensive study of unmet needs and developed a
detailed recovery plan designed to identify priority areas. The following areas constituted the
largest concentrations of unmet housing needs and LMI (low-to-moderate income) individuals
impacted by Hurricane Harvey: Port Acres,Montrose,El Vista/Vista Village,Lakeview and Park
Central.The Port Acres and El Vista neighborhoods will receive a vast reduction in flooding risks
through improved infrastructure funded through HMGP(Hazard Mitigation Grant Program)and
CDBG-DR(Community Development Block Grant — Disaster Recovery) infrastructure funding.
One of the other neighborhoods, Montrose, has been designated as a DRRA (Disaster Risk
Reduction Area).
Though not identified in the April 2018 study, residents within the Herget Ave. and Foley Ave.
DRRA have been denied assistance through all other federal programs due to environmental
concerns in the area. Representatives of the GLO have advised these residents and city officials
that the only assistance for which residents in this DRRA will be eligible is assistance through the
Local Acquisition and Buyout Program.
Large portions of the housing stock in these identified areas were destroyed or damaged by
flooding during Hurricane Harvey. It is estimated that within the target areas alone, there are
approximately 200 housing units considered priority housing acquisitions at an estimated cost of
$13,000,000, with another 150 units identified throughout the City at an estimated cost of
$9,750,000.
In response to the needs of homeowners,the City of Port Arthur applied for and received federal
funding through the Texas General Land Office. The GLO's Community Development and
Revitalization(GLO-CDR)division oversees the administration of Community Development Block
Grant Disaster Recovery (CDBG-DR) funds provided by the U.S. Department of Housing and
Urban Development (HUD) following a disaster.These funds remain the most flexible recovery
source available and can support communities with protection andresiliency.
The acquisition program will remove homes and people from harm's way. The City will acquire
thirty-one (31) properties damaged during Hurricane Harvey or located within disaster risk
reduction areas. The program will relocate homeowners and their families to low risk areas
outside of the floodplain/floodway and assist qualified applicants in moving/relocation expenses.
1
Additional incentives, relocation assistance and down payment assistance may be utilized to
encourage eligible households to relocate to a suitable living environment.
The purpose of the City of Port Arthur DR-4332 Local Acquisition Guidelines is to aid in the
long-term recovery efforts by encouraging families who face a risk to health and safety due to
hazards created by Hurricane Harvey to permanently relocate to areas outside of the floodplain,
floodway, or Disaster Risk Reduction area (if deemed applicable). This Program will be
administered by the City of Port Arthur.
Overview
The DR-4332 Local Acquisition Program is designed to assist homeowners that are currently
located in the existing or proposed floodplain,floodway,or potential Disaster Risk Reduction
Areas(DRRA)to relocate to an area that is less prone to flooding and disaster.
While no Disaster Risk Reduction Areas have been identified at the time of adoption of these
guidelines, DRRA(s) may be established at a later to time if conditions are identified that
warrant designation by Council.
Goals
HUD has authorized the use of Acquisition programs to:
(i) Reduce the risk to homeowners from the effects of subsequent disasters.
(2)Assist in the recovery of low to moderate income households.
(3) Protect taxpayer resources that might otherwise be needed after disaster in the same area
(8o FR 72102).
Acquisition programs support hazard mitigation,floodplain management goals,and resiliency
by removing homeowners from the floodplain,thus eliminating vulnerability to future flooding
situations.
The City of Port Arthur has established that in order to be eligible for acquisition the home or
property must be located in a floodplain, floodway, or DRRA. Having a home located in a
floodplain, floodway, or DRRA is a predictable environmental threat to the safety and well-
being of program beneficiaries as evidenced by the best available data and science.
Property located in a Floodway May NOT Be Redeveloped
The City of Port Arthur may not redevelop property acquired through the DR-4332 Local
Acquisition Program located within a floodway. Property located within a floodway and
acquired by the City will be dedicated and maintained in perpetuity for a use that is compatible
with open space, recreational, or floodplain and wetlands management practices, or other
purposes allowed by HUD and accepted by the GLO. No new structure will be erected on
property acquired within a floodway under the acquisition or relocation program other than:
• a public facility that is open at all sides and functionally related to a designated open
2
space(e.g.a park,campground,or outdoor recreation area)
• a restroom
• a flood control structure,provided that structure does not reduce valley storage,
increase erosive velocities,or increase flood heights on the opposite bank,upstream,
or downstream and that thelocal floodplain manager approves,in writing,before
the commencement of the construction of the structure.
Property located in a Floodplain or DRRA May Be Redeveloped
The City of Port Arthur may use property acquired through the DR-4332 Local Acquisition
Program located within an existing or proposed floodplain or DRRA for redevelopment
activities while ensuring resiliency and mitigating the impact of future disasters. The following
covenants/restrictions will be placed upon acquired properties and will remain in effect for
perpetuity:
• Any structures constructed shall be elevated at least two (2) feet above base
floodplain elevation(BFE)
• Flood insurance shall be maintained on all structures constructed on property
3
Voluntary Acquisition Program
Definitions
Adjusted Gross Income (AGI): AGI is an individual's total gross income minus specific
deductions. The GLO Adjusted Gross Income Methodology may be found at:
http://recovery.texas.gov/.
Affirmatively Furthering Fair Housing(AFFH):The City desires to ensure that the program meets the
requirements of the Affirmatively Furthering Fair Housing Final Rule to provide all residents of
the City an opportunity to improve their living environments within the program parameters as
established by GLO.
Affordability Period:The period of time during which a property must comply with CDBG-DR
program rules and regulations, including primary residency, income, and rent restrictions as
applicable.
Applicant/Homeowner/Survivor: (Used interchangeably) Individuals whose homes or
housing units were destroyed, made uninhabitable, needed repairs, or who suffered disaster-
related displacement from their primary residences and/or loss of property.
Area Median Income (AMI): Calculated annual limits based on HUD-estimated median
family income with adjustments based on family size used for demonstrating LMI beneficiaries in
the programs. May also be referred to Area Median Family Income (AMFI) in other program
documents.
Acquisition: Purchase of an eligible property at the fair market value of the land and structures
with the intent to reduce risk from future flooding or to reduce risk from future hazard.
Acquisitions are properties within defined Disaster Reduction Risk Areas(DRRA),determined in
consultation with county and local governments such as areas within the ioo-year floodplain
and/or in the highest risk areas as defined by FEMA flood map"V Zone."The property acquired
will be dedicated and maintained in perpetuity for a use that is compatible with open space,
recreational use, or floodplain and wetlands management practices.Acquisition-only is typically
not considered a complete activity in the Program and may be combined with another eligible
activity(i.e.,relocation assistance and new construction of housing).
Beneficiary: The recipient deriving advantage from CDBG-DR funding.
Community Development Block Grant (CDBG): A federal program administered by the
US Department of Housing&Urban Development(HUD)which provides grant funds to local and
state governments. The CDBG program works to ensure decent affordable housing, to provide
services to the most vulnerable in our communities,and to create jobs through the expansion and
retention of businesses.
4
Current Fair Market Value (CFMV): As-is value of property at time of appraisal. Also
referred to as post-disaster value. Includes structure(s), land parcel, rights and easements.
Appraisal methodology will use comparable sales approach and highest best use assumption to
determine CFMV.
Demolition:The clearance and proper disposal of dilapidated buildings and improvements.
Disabled Household: Disabled household*is*a household composed of:
1. One or more persons at least one of whom is an adult (18 years or older) who has a
disability;
2.Two or more persons with disabilities living together,or one or more such persons living
with another person who is determined by HUD, based upon a certification from an
appropriate professional (e.g., a rehabilitation counselor, social worker, or licensed
physician)to be important to their care or wellbeing;or
3.The surviving member or members of any household described in paragraph(1)of this
definition who were living in a unit assisted under this part with the deceased member of
the household at the time of his or her death. [24 CFR 891.305]
Disaster Risk Reduction Area: An area identified as meeting the following conditions as
declared by Resolution of the City Council:
1. An area containing a hazard caused or exacerbated by the Presidentially declared
disaster for which the grantee received its CDBG-DR allocation;
2. The hazard must be a predictable environmental threat to the safety and well-being of
Program beneficiaries,as evidenced by the best available data and science; and
3. The Disaster Risk Reduction Area must be clearly delineated so that HUD and the
public may easily determine which properties are located within the Disaster Risk
Reduction Area.
4. In carrying out acquisition activities, the subrecipient must ensure they are in
compliance with their long-term redevelopment plans.
Documented Impact (DI): Documented Impact from Hurricane Harvey includes copies of
Flood Insurance Claim Adjustor Report and Claim Payment Summary, FEMA Damage
Assessment, FEMA Individual Assistance Emergency Home Repair payments, and geo-
referenced/time-stamped photos. As all potential participants are required to provide
documented proof of impact,this captures the tie back to the storm requirement as stated in the
GLO's Acquisition and Acquisition Program Guidelines Checklist.
Duplication of Benefits:The Robert T.Stafford Disaster Assistance and Emergency Relief Act
(Stafford Act) prohibits any person, business concern, or other entity from receiving financial
assistance from CDBG-DR funding with respect to any part of a loss resulting from a major
disaster as to which he/she has already received financial assistance under any other program or
from insurance or any other source.
Elderly Family:
5
1. Families of two or more persons,the head of which(or his or her spouse)is 62 years of
age or older;
2.The surviving member or members of a family described in paragraph(1)living in a unit
assisted under 24 CFR part 891,subpart E(Section 202 loans)with the deceased member
of the family at the time of his or her death;
3.A single person who is 62 years of age or older;or
4. Two or more elderly persons living together, or one or more such persons living with
another person who is determined by HUD,based upon a licensed physician's certificate
provided by the family,to be essential to their care or well-being. [24 CFR 891.505]
Eligible Properties(EP):Eligible Properties are those within a floodplain,floodway,or DRRA
with documented impacts from Hurricane Harvey.
Environmental Review:All qualified projects must undergo an environmental review process.
This process ensures that the activities comply with National Environmental Policy Act (NEPA)
and other applicable state and federal laws.
Fair Housing: Activities that follow the rules and guidelines set forth in the Fair Housing Act
and subsequent fair housing legislation. The goal of these activities is to eliminate housing
discrimination,promote economic opportunity, and achieve diverse,inclusive communities.
Fair Housing Marketing Plan: A marketing strategy designed to attract applicants of all
majority and minority groups, regardless of sex, handicap, familial status, etc. to participate in
the housing activities which are being marketed.
Fair Market Value:The hypothetical price that a willing buyer and seller will agree upon when
they are acting freely,carefully,and with complete knowledge of the situation.
Federal Emergency Management Agency (FEMA): An agency of the United States
Department of Homeland Security.The agency's primary purpose is to coordinate the response
to a disaster that has occurred in the United States and that overwhelms the resources of local and
state authorities.
Federal Register Notice(FRN):The federal document,published by HUD,which governs the
rule and requirement of the grant.
Floodplain: FEMA designates floodplains as geographic zones subject to varying levels of flood
risk. Each zone reflects the severity or type of potential flooding in the area. • "loo-year
floodplain" — the geographical area defined by FEMA as having a one percent chance of being
inundated by a flooding event in any given year. •"500-year floodplain"—the geographical area
defined by FEMA as having a 0.2 percent change of being inundated by a flooding event in any
given year.
Head of Household: The adult member of the family who is the head of the household for
purposes of determining income eligibility and rent. [24 CFR 5.504]
6
Housing Incentives: Housing incentives is an overarching term comprising two
subcategories: Down Payment Assistance and Optional Relocation Assistance.The purpose of
such housing incentives is to encourage maximum participation by property owners and to
facilitate the relocation of those applicants to Decent Safe Sanitary Housing(DSSH)options in
safer,more disaster-resilient areas.
Low-Income Family:A family whose annual income does not exceed 80 percent of the area
median income,as determined by HUD,with adjustments for smaller and larger families. [24
CFR 5.603]
Low-Moderate Income Households:A household is considered LMI if they make less than
80%of the area median income.Income prioritization will be determined using area median
household income adjusted for family size and verified following the GLO's Adjusted Gross
Income Methodology.The methodology uses the previous year's filed tax return or tax return
transcript for all household members to verify the household's annual income.
Manufactured Homes: Manufactured homes are pre-constructed to a federal HUD building
code completely in a factory on a permanent,fixed steel chassis.Manufactured homes typically
have skirting or siding around the bottom of them to hide where the wheels were removed.
Special residential zoning restrictions limit their placement in the City.
Modular Homes: Modular homes are pre-built in sections at a factory,then transported to the
building site,placed on a permanent foundation,and finished on location.Modular homes must
conform to all local,state,and regional building codes and require a post-construction building
inspection.
National Environmental Policy Act(NEPA): Establishes a broad national framework for
protecting the environment.NEPA's basic policy is to assure that all branches of government
give proper
consideration to the environment prior to undertaking any major federal action that could
significantly affect the environment.
National Flood Insurance Program(NFIP): Created by Congress in 1968 to reduce future
flood damage through floodplain management and to provide people with flood insurance
through individual agents and insurance companies. FEMA manages the NFIP.
Single Family Home:A single-unit family residence detached or attached to other housing
structures.
Substantial Damage: Occurs when a property sustains damages that equal or exceed 50
percent of its Fair Market Value(FMV)prior to the event,as determined by a local authorized
official(e.g.,a code officer)and is sent a Substantial Damage Letter,or if the ECR/AA value
(minus elevation and bulkheads costs)meets or exceeds 5o percent of the program cap.
7
Local Acquisition Program Requirements
National Objective
Housing activities under the DR-4332 City of Port Arthur Acquisition Program must meet one
of the following National Objectives:
LMHI —Low to Moderate Housing Incentive- assisted with a housing incentive tied to the
voluntary Acquisition of housing owned by the qualifying LMI household for the
purpose of moving outside of the affected floodplain or to a lower-risk area.
LMA—End use of property provides a benefit to an area determined by census data or
household income survey to consist predominantly of low-to-moderate income
households
Environmental
All sites must undergo a complete environmental review prior to any commitment of funds.The
environmental review should document compliance with 24 CFR Part 58 and all related laws and
authorities. Properties with adverse environmental conditions will not be permitted to proceed
under housing activities unless the adverse conditions are corrected. No work can start on a site
until the environmental evaluation is complete.
Proof of Event Damage
For acquisition activities, the homeowner must demonstrate that damage or destruction to the
home occurred or a hazard currently exists as the result of the DR-4332 disaster event. All
verification methods are subject to City of Port Arthur approval.
Method of Verification
Disaster damage can be documented by the following source documentation:
• FEMA,SBA or Insurance award letters
Alternate Method of Verification
• If the above-referenced documentation is not available and/or if a homeowner was denied
assistance by FEMA, assistance through the DR-4332 Acquisition Program may still be
available. Homeowners are not solely ineligible based on a denial by FEMA. Time stamped
photos provided by homeowners, neighborhood level media reports,or documentation done
by disaster relief organizations may be utilized to determine that the damage was caused by
the event.As a last resort, a Damage Assessment complete with photos of the damage and a
written assessment of the damage by each photo taken must be performed and conducted by
a certified or licensed inspector (HQS, TREC, or similar license). This inspection must be
completed in accordance with GLO's Damage Assessment Guidelines and must be supplied
by City of Port Arthur as the GLO subrecipient that certifies the damage occurred as a result
of the event.
16
• If proof of event damage is inconclusive,City of Port Arthur must provide alternative
evidence to GLO prior to approval of any assistance.
Affirmative Fair Housing Marketing Plan
The goal of the City of Port Arthur is to ensure that outreach and communication efforts reach
eligible survivors from all racial, ethnic, national origin, religious, familial status, the disabled,
"special needs,"and gender groups.Emphasis will be focused on successful outreach to LMI areas
and those communities with minority concentrations that were affected by the disaster.Outreach
efforts may include:
• Door-to-door canvassing and special outreach efforts to hard-to-reach populations
(e.g.,seniors,and persons with severe disabilities who either do not have information
about the resources available or are unable to apply for resources).
• Advertise with the local media outlets, including newspapers and broadcast media,
that provide unique access for persons who are considered members of a protected
class under the Fair Housing Act;
• Flyers in utility and tax bills advertising the Program;
• Reach out to public or non-profit organizations and hold/attend community meetings;
• Other forms of outreach tailored to reaching the eligible population, including door-
to-door outreach,and on the weekends,if necessary;
• Measures will be taken to make the Program accessible to persons who are considered
members of a protected class under the Fair Housing Act by holding informational
meetings in buildings that are compliant with the Americans with Disabilities Act
(ADA), providing sign language assistance when requested, and providing special
assistance for those who are visually impaired when requested.
• Applications and forms will be offered in English and other languages prevailing in the
region in accordance with Title VI of the Civil Rights Act of 1964, including persons
with disabilities (24 CFR 8.6), Limited English Proficiency (LEP), and other fair
housing and civil rights requirements such as the effective communication
requirements under the Americans with Disabilities Act. Every effort will be made to
assist such applicants in the application process.
• Case managers will help navigate and inform survivors who may qualify for acquisition
and Acquisition of their damaged unit to remove them from flood hazards,
environmental hazards,and other unsafe conditions while meeting AFFH obligations.
• Documentation of all marketing measures used,including copies of all advertisements
and announcements,will be retained and made available to the public upon request.
• Subrecipients and the state will be required to use the Fair Housing logo in Program
advertising,post Fair Housing posters and related information and,in general,inform
the public of its rights under Fair Housing regulations law.
• The City will coordinate with HUD-certified housing counseling organizations to
ensure that information and services are made available to both renters and
homeowners. Additional information for each grantee is available here:
https://apps.hud.gov/offices/hsg/sfh/hcc/hcs.cfm?weblistaction=summary
Applications
Upon approval of these guidelines by the General Land office,the City of Port Arthur will accept
17
applications for a period of sixty(60)days by the following methods:
In person:
City of Port Arthur City Hall Annex*
444 4t St.
Port Arthur,TX 77640
Monday-Friday, 8:3o am—4:3o pm
Via mail:
City of Port Arthur
Attn: Pamela Langford
P.O.Box 1089
Port Arthur,TX 77641
Special arrangements can be made for persons with special needs, language interpretation or
for persons needing alternate times and locations by calling Pamela Langford, Development
Services Manager,at(409)983-8135.
*This location is accessible under the American for Disabilities Act Accessibility Guidelines.
Should the initial application period not yield enough applications to expend all allocated funding,
the City will re-advertise the program and conduct another sixty(6o)day application period.
Timeliness of Homeowner Application Status
The City of Port Arthur will ensure timely communication of application status to homeowners
who have applied for disaster recovery assistance. Timeliness includes-multiple methods of
communication, such as City of Port Arthur and Traylor&Associates websites,phone, email,
letters, site visits, and case managers to provide homeowners for recovery assistance with
timely information regarding the status of their application for recovery assistance at all phases.
City of Port Arthur will ensure the accessibility and privacy of individualized information for
all homeowners, frequency of homeowner status updates and personnel responsible for
informing homeowners of the status of recovery applications. Questions regarding status of an
application may be directed to:
Melinda Smith, Project Manager
Traylor&Associates, Inc.
P.O Box 7035
Tyler,TX 75711
903-581-050o ext. 219
Affirmatively Furthering Fair Housing (AFFH) Review
All projects must undergo an AFFH review by the GLO prior to any commitment of funds. Such
review will include assessment of a proposed project's area demography, socio economic
18
characteristics, housing configuration and need, educational, transportation, health care
opportunities, environmental hazards or concerns, and all other factors material to the
determination.Applications should show that projects are likely to lessen area racial, ethnic, and
low-income concentrations, and/or promote affordable housing in low-poverty, non- minority
areas in response to natural hazard related impacts.
Records Retention
Compliance will be maintained in accordance with the reporting requirements under the GLO's
CDBG-DR Program. This includes providing all information and reports as required under the
GLO's contract with the City of Port Arthur, demographic data and other information acquired
from the homeowners,and project documentation from awarded homeowners. This information
must be retained at the City for 3 years after GLO closes the DR-4332 flood grant with HUD.
Section 3
1) Compliance with Section 3 is required by 24 CFR Part 135 and the
executed contract between the City of Port Arthur and the GLO. City of
Port Arthur is subject to the GLO's Section 3 Policy. A Section 3 Plan will be
created and continue to be updated throughout the program process. In order
to comply with Section 3,the acquisition program will do the following
whenever necessary:
• Implementing procedures to notify Section 3 residents and business
concerns about training, employment, and contracting opportunities
generated by Section 3 covered assistance;
• Notifying potential contractors working on Section 3 covered projects of
their responsibilities;
• Incorporating the Section 3 Clause into all covered solicitations and
contracts [see 24 CFR Part 135.38];
• Facilitating the training and employment of Section 3 residents and the
award of contracts to Section 3 business concerns;
• Assisting and cooperating with HUD Policy in making contractors and
subcontractors comply;
• Refraining from entering into contracts with contractors that are in
violation of Section 3 regulations;
• Documenting actions taken to comply with Section 3; and
• Submitting Section 3 Quarterly and Annual Summary Reports (form HUD-
60002).
Homeowner Data
The GLO will establish procedures for City of Port Arthur to collect and report data relevant to
HUD. The reporting requirements will include, but not be limited, to the following for each
program activity requiring a direct application by an individual or non-institutional entity:
• Homeowner's household income.
19
• Household's income as a percentage of area median family income as defined by HUD.
• The race,ethnicity,and gender of the head of household.
• The household's familial status.
• The presence or non-presence of a household member with a disability.
• The presence or non-presence of a household member that is a Veteran.
Procurement Requirements
City of Port Arthur will provide adequate documentation to show that the selection process was
carried out in an open, fair, uniform, and thorough manner to ensure that federal (2 CFR
200.318-200.326)and state procurement requirements were met.
It's important to note that failure to maintain proper documentation may result in disallowed
costs.These records must include,but are not limited to,the following information:
• Rationale for the method of procurement
• Evaluation and selection criteria
• Contractor selection or rejection
• The basis for the cost or price.
During the procurement process,City of Port Arthur will clearly identify any items included in
the bid/purchase that are not included in the CDBG-DR contract. City of Port Arthur may
utilize HUD's CDBG-DR and Procurement guidance6.
City of Port Arthur will procure goods and services using the federal procurement and contract
requirements outlined in 2 CFR 200.318—200.326.These procurement requirements must be
followed for reimbursement from grant allocations of CDBG-DR funds provided by the U.S.
Department of Housing and Urban Development(HUD).City of Port Arthur is also required to
follow state and local procurement laws and policies as prescribed by 2 CFR 200.318(a)as well
as the additional requirements stated in 2 CFR Part 200.
Additionally, City of Port Arthur may request that the GLO review draft solicitations or
responses prior to award for compliance.
City of Port Arthur will execute a contract to document the work to be completed,the agreed
price,and contractor or provider's required compliance with all applicable federal, state, and
local requirements that City of Port Arthur must follow. If there is a conflict between federal,
state, and local laws and regulations regarding procurement, the more stringent law or
regulation will apply.
Conflict of Interest
The conflict of interest regulations contained in the contract between City of Port Arthur and
the GLO prohibit local elected officials, City of Port Arthur employees, and consultants who
exercise functions with respect to CDBG-DR activities or who are in a position to participate in
a decision-making process or gain inside information with regard to such activities, from
receiving any benefit from the activity either for themselves or for those with whom they have
family or business ties,during their tenure or for one year thereafter.
For purposes of this section, "family" is defined to include parents (including mother-in-law
and father-in-law), grandparents, siblings (including sister-in-law and brother-in-law), and
20
children of an official covered under the CDBG-DR conflict of interest regulations at 24 CFR
Sec.570.489(h).
The GLO is able to consider granting an exception to the conflict of interest provision should it
be determined by the GLO that City of Port Arthur has adequately and publicly addressed all
of the concerns generated by the conflict of interest and that an exception would serve to
further the purposes of Title I of the Housing and Community Development Act of 1974 and the
effective and efficient administration of the program. City of Port Arthur should not enter a
conflict of interest until justification has been received and approved by the GLO in accordance
with applicable procurement laws.
Complaint/Appeal Process
General Policy
The GLO and City of Port Arthur are responsible for responding to complaints and appeals in
a timely and professional manner.The City will keep a record of each complaint or appeal that
it receives to include all communications and their resolutions.
When a complaint or appeal is received, a representative will respond to the complainant or
appellant within fifteen(15)business days where practicable. For expediency,the City of Port
Arthur will utilize telephone communication as the primary method of contact.However,email
and postmarked letters will be used as necessary. The following procedures as well as contact
information will be provided in the homeowner's application packet.
Responsibilities
The City of Port Arthur has tasked an independent consultant, Traylor &Associates, Inc., to
handle all homeowner inquiries regarding DR-4332 Acquisitions.Traylor&Associates will:
1) Determine whether or not complaints and appeals relate to the business or authority of the
City.
2) Ensure that a response to all complaints and appeals are within the appropriate time frame.
• Response must be provided within 15 working days of the receipt of the complaint.
3) Usher all complaints and appeals through to a resolution.
City of Port Arthur has developed an internal procedure for handling incoming complaints,
including a complaint escalation process in order to ensure that complaints are handled at the
earliest stage in the process.
To file a complaint or appeal regarding the DR-4332 Acquisition Program,please contact:
Pamela Langford, Development Services Manager
444 4th St. (physical) P.O. Box 1089(mailing)
Port Arthur,TX 7764o Port Arthur,TX 77641
21
Documentation
Documentation for each complaint or appeal must be maintained.Each file must include the
following:
• Contact information for homeowner
• Initial complaint
• Address and GLO assigned project number(if applicable)
• Any communications to and from homeowner
• Results of the investigation,together with any notes,letters, or other investigative
documentation
• The date the complaint or appeal was closed
• Any other action taken.
Audit Requirements
If the City of Port Arthur receives funds which exceed the thresholds set in 2 CFR§200.501,Audit
Requirements the city will have a single or program specific audit conducted in accordance with
the applicable federal requirements.
Changes,Waivers, and/or Conflicts
City of Port Arthur has the right to change, modify, waive, or revoke all or any part of these
guidelines, with the prior written approval of the GLO.Waivers to the requirements in these
Guidelines can only be approved by the GLO and must be provided in writing.The GLO will
provide the option for a waiver,only after the posting of the waiver request on the City's website
for a public comment period of at least seven (7) days. The waiver request must demonstrate
why the housing guidelines are not practicable for City of Port Arthur.
In the event that these Guidelines conflict with local,state, or federal law,the more stringent
requirement will prevail,provided that the requirement does not violate local,state,or federal
law.
22
Homeowner Eligibility Requirements
Case Management
Homeowners are likely to need support throughout the process.Homeowners may have suffered
significant losses and emotional hardships. Undertaking the process to claim insurance is often
burdensome and confusing.The simple mechanics of applying to the program may be difficult for
a homeowner to complete. As a GLO subrecipient, we will work to cultivate partnerships with
local and community liaisons such as banks,counseling agencies,legal services,title companies,
etc.
City of Port Arthur Case Managers will work to assist homeowners from inception to close out
under the DR 4332 City of Port Arthur Acquisition Program A single point of contact will be
assigned to each homeowner to ensure that homeowners have the immediate contact information
to be successful in their long-term recovery efforts. As applications are being accepted and
reviewed for determinations of eligibility to participate in the Program, each homeowner will be
counseled and made aware of their application status.
Application Intake and Counseling
Included in this program design is the mechanism to prevent any pre-screening of homeowners
without a written application being taken therefore anyone who makes an inquiry about the
program is provided City of Port Arthur application package to complete. All such inquiries will
be reported in a format to be provided by GLO. All documentation submitted by the homeowner
must include a signed statement, verifying that the information provided is true, complete and
accurate. Any false, fictitious, or fraudulent information, or the omission of any material, may
subject the homeowner to criminal,civil or administrative penalties.Program documents include
the following statement:
"Warning: Any person who knowingly makes a false claim or statement to HUD
maybe subject to civil or criminal penalties under 18 U.S.C.287,1001 and 31 U.S.C.
3729."
Case Managers or Interpreters must be able to communicate with the homeowners in their
primary language and should be assigned to the clients as appropriate. Additionally, they must
ensure effective communications with persons with disabilities pursuant to 24 CFR 8.6 and other
fair housing and civil rights requirements (such as the effective communication requirements
under the Americans with Disabilities Act).Case Managers will be trained to be well versed in all
aspects of the DR 4332 Acquisition Program.
Assisted Homeowner Priority and Eligibility Requirements
HUD has established the requirement that 70% of the aggregate of CDBG-DR funds be utilized
for the benefit of the low- and moderate-income population in the impacted area. HUD has
indicated they will only consider a waiver to this requirement if it can be adequately demonstrated
that the needs of the low-or moderate-income population within the impacted area have had their
23
needs sufficiently addressed or potentially if the impact is less than 70%low-or moderate-income
persons.
The following are threshold requirements,which must be met for a homeowner to be eligible for
assistance. Eligibility does not assure assistance since a prioritization strategy within LMI
economic subgroups is required that is consistent with GLO Program Design requirements and it
is expected that there will be more eligible homeowners than can be served with available funds.
City of Port Arthur is establishing the following priorities for applicant selection:
Priority 1: Low-to-moderate income 30 percent and below
Priority 2: Low-to-moderate income 50 percent and below
Priority 3: Low-to-moderate income 80 percent and below
Priority 4: Non-Low-to-moderate income
Income Eligibility
Income levels will be established for all homeowners.Although low income homeowners will be
given priority, it is not necessary to be low income to qualify for this program. HUE) publishes
these AMFI levels annually, and eligibility will be based on the most recently published HUD
income limits. This program will verify income received by all household members using the
Internal Revenue Service (IRS) Form 1040 series method. Documents used in verifying
household income must be current as of the date the application is signed.
Income sources include but are not limited to the following:
— Tax Return
— Wages
- Benefits(Social Security,Pension or Retirement,Annuity)
- Self Employed/Business Income
- Rental Income
- Unemployment
- Alimony/Spousal Support/Maintenance
- Other potentially taxable income
- Lump sum or on time potentially taxable receipts(capital gains,lottery winnings etc.)
A household is considered LMI if they make less than 8o%of the area median income.Income
eligibility will be determined using the Low(8o%)Income Limit from the HUD Section 8
Housing Income Limits adjusted for family size and verified following the GLO's Adjusted Gross
Income Methodology.The methodology uses the previous year's filed tax return or tax return
transcript for all household members to verify the household's annual income.
The LMI threshold for an individual household will vary based on number of household
members,as shown in the following guidance table provided by HUD.
24
Median Family Persons in Family
FY
FY 2020 Income Limit Area Income 2020 Income
Ixplanalxx� Limit Category 1 2 3 4 5 6 7 8
Very Low(50%)
Income Limits(S) 23,650 27,000 30,400 33,750 36,450 39,150 41,850 44,550
I xprl inalion
Extremely Low
Beaumont Port Arthur,
IX HUD Metro FMR Area $57,500 Income Limits($)' 14,200 17,240 21,720 26,200 30,680 35,160 39,640 44,120
I xld;urduni
Low(80%)Income
Limits($) 37,800 43,200 48,600 54,000 58,350 62,650 67,000 71,300
I xpldrIaIrtxi
Source: https://www.huduser.gov/portal/datasets/i012020/2020summary.odn
Method of Verification
IRS Criteria and Definition
Taxable income is the gross income of an individual or corporation, less any allowable tax
deductions. Your taxable income is the amount of your income that is subject to income tax, as
defined in the Internal Revenue Code Section 63.Jan 23,2012.
Determining Household Composition
All persons living in the household are part of the household unless they are specifically excluded.
Included persons:
• Head of household,spouse,or co-head of household
• Dependents
• A dependent is never the head,spouse,or co-head.A dependent is a family member who is
under 18 years of age,disabled or a full-time student.
• Prison inmates,if scheduled to be released within 12 months
• Children in joint custody,if in home at least 50%of the time or more
• Military personnel,but only if head,spouse,or co-head.Combat/Hazard pay should not be
counted as income
• Temporarily absent family members.Gross income and income from assets of temporarily
absent family member must be counted in household income,regardless of the amount of
income the absent member contributes to the household.
• If a homeowner is separated from their spouse,the homeowner's application will be used as
proof that the estranged spouse is permanently absent from the household.
Excluded persons:
• Live-in aides
• Children of live-in aides
• Foster Children
• Foster Adults
25
Proof of Ownership
The homeowner must be an individual who owns the home to be demolished or the adjacent
vacant lot(s)that are to be purchased by City of Port Arthur. Ownership can be documented as
follows:
• A valid deed of trust or warranty deed that is recorded in City of Port Arthur
• Statement of Ownership and Location(for Mobile Home Units)
Lien's on MHU properties — If a homeowner owns a mobile home and there is a lien on the
property,your City of Port Arthur case manager will work with the property owner to ensure that
the lien is transferred properly (if one is in place with the mortgage company).The MHU needs
to be"perfected" and made a real property showing that is fixed to the lot.The wheels and axel
need to be removed,and a statement of location needs to be in place from TDHCA. Once this is
done,the lender can transfer the lien from the mobile home to the new property.
Property Taxes
Homeowner must furnish evidence that property taxes are current, have an approved payment
plan,or qualify for an exemption under current laws.Homeowner must prove that property taxes
have been paid or that one of the following alternatives have been met:
• The homeowner qualified for and received a tax deferral as allowed under Section
33.06 of the Texas Property Tax Code;
• The homeowner entered into a payment plan with the applicable taxing authority.
• Support documentation verifying the tax deferral or tax exemption must be provided by the
homeowner.Any homeowner that enters into a payment plan must supply a signed copy of
the payment plan from the applicable taxing entity along with documentation that they are
current on their payment plan.
Duplication of Benefit(DOB) Review
Each homeowner's application will be reviewed to determine if previous funding was
appropriately used on the home. The homeowner must have an unmet need to move forward in
the program. City of Port Arthur will determine the homeowner's unmet needs first prior to
calculating the homeowner's DOB. Homeowner must provide insurance, FEMA, SBA, and any
other type of funding documentation for funds that were received.Additionally, the City/Grant
Administrator will verify that the submitted data is accurate to the best of their abilities (e.g.
validate against FEMA data).
The most common sources of disaster recovery assistance are from homeowner's insurance,
FEMA,NFIP,and SBA. However,assistance may also come from non-profit organizations,faith-
based organizations, other disaster relief organizations, and other governmental entities.
Duplicative Assistance includes,but is not limited to,the following benefits:
26
National Flood Insurance Program(NFIP):Insurance proceeds received must be disclosed
by the Owner(s) and verified by the Program. Payments from the NFIP for building loss are
classified as repair assistance and will be considered duplicative assistance.
Private Insurance:All insurance proceeds received must be disclosed by the Owner(s)and verified
by the Program by obtaining a final claims letter or contacting the insurance company. Any funds
received that are classified as building loss or sewer backup will be classified as repair assistance
and will be considered duplicative assistance.
Federal Emergency Management Agency (FEMA): FEMA proceeds received must be
disclosed by the Owner(s) and must be verified by the Program.Any funds received for property
repair will be classified as duplicative assistance.
Small Business Administration (SBA): SBA proceeds approved and/or received must be
disclosed by the applicant and verified by the Program. Any applicant with an SBA loan of less
than $14,000 must provide documentation that he or she is current on his or her repayment plan
and outstanding SBA loans must be satisfied prior to the City taking ownership of the property.
The applicant's award is reduced by this amount at closing and the loan is satisfied prior to the
City taking ownership of the property.Any SBA loan exceeding$14,000.00 is secured against the
subject property and will be repaid(satisfied)at closing pursuant to traditional real estate transfer
procedures. SBA loans are unique in that the deduction of the DOB occurs at the closing table
(which reduces the applicant's net proceeds)as opposed to at the time of the offer.
Other: Funds received from other sources must be disclosed by the Owner(s)and verified
by Program.Examples include nonprofits,other governmental agencies,and social groups.
Using the GLO's DOB Calculation Form,if the prior assistance received exceeds the documented
repairs, this calculated amount becomes the DOB amount. The Case Manager will identify any
possible Duplication of Benefits and discuss with homeowner.
As part of the Acquisition process,homeowners will be required to sign a subrogation agreement.
The subrogation agreement will require that the homeowner pay back funds if he/she receives
any future disaster assistance for the same reason.Future assistance could include funds from an
insurance company if the homeowner is in current litigation and later receives funds from the
claim.Applicants will sign a subrogation agreement indicating that they will repay any funds they
received deemed to be duplicative after their Program real estate closing. In an effort to avoid this
and the costs involved in the subrogation process,the City will not purchase any homes that are
subject to an ongoing insurance settlement case or legal action. The deadline for litigation
settlements that could impact duplication of benefits is March 1,2021.
27
Child Support
All homeowners and other members of their household must be current on payments for child
support. If any member of the household is not current on child support, that member will be
required to enter into a payment plan which will be obtained from the Office of Attorney General
(OAG). A copy of the payment plan signed by all applicable parties along with documentation
demonstrating they are current on their payment plan must be supplied. Each homeowner will
be asked to sign an affidavit regarding child support.
Damage assessment
All homes must be assessed to verify that it was damaged, or a hazard is presently caused from
the event. A damage assessment report along with pictures will be required for each application.
Please refer to the GLO's Damage Assessment Guidelines.
Environmental Review
An environmental review must be performed on the property prior to federal funds being
committed by City of Port Arthur(24 CFR Parts 50,58,574,582,583,and 970).No commitment
or disbursement of funds will occur prior to the completion of this review. The environmental
review should document compliance with 24 CFR Part 58 and all related laws, authorities and
executive orders. The CDBG-DR Program will not reconstruct or rehabilitate homes that have
been determined to be in the floodway.
Flood Insurance Verification/Requirements
Flood Disaster Protection Act of 1973 as amended and Sec.582(a)of the National Flood Insurance
Reform Act of 1994 — compliance with the legal requirements of Section 582(a) mandates that
HUD flood disaster assistance that is made available in an Special Flood Hazard Areas (SFHAs)
may not be used to make a payment (including any loan assistance payment) to a person for
repair, replacement, or restoration for flood damage to any personal, residential or commercial
property if: (1)the person had previously received Federal flood disaster assistance conditioned
on obtaining and maintaining flood insurance; and(2)that person failed to obtain and maintain
flood insurance as required under applicable Federal law on such property.
Project Closeout/Affordability Monitoring Requirements
Approved projects will require affordability note monitoring if the homeowner receives housing
Incentive through the DR-4332 Acquisition Program. For activities that include housing
Incentives, City of Port Arthur will set a budget to accommodate the necessary work to perform
the monitoring requirements under the Unsecured Forgivable Promissory Note for three (3)
years. To ensure compliance with the requirements of the 13.09 executed with the homeowner,
City of Port Arthur will perform an annual check to confirm all promissory note commitments are
in place through the term of the 13.09. Insurance notice of default will be documented and
followed up on as they are received by the City. City of Port Arthur will use the GLO Monitoring
Process.
28
Closing Activities
Once all eligibility requirements have been met and final approval has been received from GLO,
the title company will schedule a meeting between the homeowner and a representative from City
of Port Arthur to sign closing paperwork on the Acquisition property. The Case Manager from
Gary R. Traylor & Associates will also be present to help with any questions that the City or
homeowner may have. Homeowners will be required to sign all closing documents provided by
the title company and a list of homeowner responsibilities will be provided(such as maintaining
insurance on replacement property and staying current on taxes). If the homeowner chooses to
accept relocation assistance,a separate closing may need to be scheduled for the purchase of the
replacement property.
Homeowner Eligibility Requirements Summary
• Income Eligibility
• Proof of Ownership
• Principle Residency
• Property Taxes
• Duplication of Benefits
• Child Support
• Damage Assessment
• Environmental Review
• Flood Insurance Verification
• Project Closeout/Monitoring
29