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Home My WebLink AboutPR 15447: SAVANNAH HOUSING CORPORATION CONTRACT AMENDMENTInteroffice Memorandum .4f'ousingAssirtance Division To: Steve Fitzgibbons, City Manag ^~l From: Rebecca Underhi/!, Assistant Ci n~ n Date: Tuesday, August i8,. 2009 Re: P.R. 15447 RECOMMENDATION: I recommend the City Council adopt Proposed Resolution 15447, authorizing an amendment to the contract between Savannah Housing Corporation and the City of Port Arthur to complete construction of homes on 5849 Texas Avenue, 5901 Texas Avenue and 5910 Texas Avenue with the City providing $100,000 per home for site preparation, and new construction and developer fees for a total of $300,000, with the City providing up to $20,000 per homebuyer for down payment and closing cost assistance, for a total of up to $60,000. The total cost of this amended contract will be up to $360,000. BACKGROUND: The City of Port Arthur has obligated itself to fulfill the statutory Federal HOME requirement of allocating a minimum of fifteen percent (15%) of its annual HOME Program funds for eligible CHDO Set-a-side activities. Savannah Housing Corporation is a chartered Texas non-profit corporation. The Mayor & City Council of Port Arthur, hereby certifies and designates Savannah Housing Corporation as a Community Housing Development Organization (CHDO) in accordance with 24 CFR 92.300. Savannah Housing Corporation will use a minimum of 15% CHDO Set aside Federal HOME Program funds to assist in carrying out the mission of the City of Port Arthur Housing Assistance Programs to eliminate blight, provide decent, safe, sanitary and affordable housing for low and moderate-income persons/families within the City. As much as 50% to 80% of the new construction homes shall be Energy STAR qualified homes in accordance with the Leadership in Energy & Environmental Design (LEEDS), Green Building System. Savannah Housing Corporation will work closely with the Tejano Center to insure qualified buyers are aware of and have access to new homes constructed in the City by Savannah Housing Corporation. The Tejano Center will facilitate the First Time Homebuyer Program which will include homebuyer orientation and education classes, credit and budget workshops, one on one counseling, pre- purchase and post-purchase counseling. Previously, the City Council authorized Savannah Housing to build three homes. However, all funding was not allocated. This amendment provides sufficient funds to complete these homes. When the homes are sold, Savannah Housing will remit approximately $285,000. The City will provide down payment and closing costs assistance up to $20,000, per homebuyer (up to $17,000 to assist with down payment and $3,000 to assist with closing costs), based on actual need. Savannah Housing Corporation has obligated itself to provide an additional $5,000 to assist with closing costs. BUDGETARY/FISCAL EFFECT: Funding will be provided by the Federal HOME Program and CHDO Set aside funds; $95,640 of 2005 funds, account number 108-2141-626.59-00, project number HE0501; $4,360 of 2006 funds, account number 108-2141-626.59-00 project number HE0601; and $60,000 of 2006 funds, account number 108-2141-626.54-01 project number HE0604. STAFFING/EMPLOYEE EFFECT: Housing Division staff will be responsible for administering the contract with Savannah Housing Corporation. SUMMARY: I recommend the City Council adopt Proposed Resolution 15447, authorizing an amendment to the contract between Savannah Housing Corporation and the City of Port Arthur to complete construction of homes on 5849 Texas Avenue, 5901 Texas Avenue and 5910 Texas Avenue with the City providing $100,000 per home for site preparation, and new construction and developer fees for a total of $300,000, with the City providing up to $20,000 per homebuyer for down payment and closing cost assistance. P. R. 15447 08-18-09 BAF/Housing RESOLUTION NUMBER A RESOLUTION AUTHORIZING AN AMENDMENT TO THE CONTRACT BETWEEN SAVANNAH HOUSING CORPORATION AND THE CITY OF PORT ARTHUR TO COMPLETE CONSTRUCTION OF HOMES ON 5849 TEXAS AVENUE, 5901 TEXAS AVENUE AND 5910 TEXAS AVENUE WITH THE CITY PROVIDING FOR EACH HOME $100,000 FOR SITE PREPARATION AND NEW CONSTRUCTION AND DEVELOPER FEES FOR A TOTAL OF $300,000 WITH THE CITY ALSO PROVIDING UP TO $20,000 PER HOME BUYER FOR DOWN PAYMENT AND CLOSING COST ASSISTANCE, ACCOUNT NUMBER 108-2141-626.59-00 PROJECT NUMBERS HE0501 AND HE0601 AND 108-2141-626.54-01 PROJECT NUMBER HE0604. WHEREAS, Savannah Housing Corporation was chartered as a Texas non-profit corporation to provide safe, decent, sanitary and affordable housing to the low and moderate income families; and, WHEREAS, the Department of Housing and Urban Development awards Federal HOME Program funds to the City annually, pursuant to the Housing and Development Act of 1974 for the primary benefit of low and moderate income persons/families; and, WHEREAS, by its adoption of Resolution Number 05-106, (authorizing submission of a 2005 Consolidated Plan) the City has obligated itself to provide direct financial assistance for homeownership to low and moderate income persons/families; and, WHEREAS, per Resolution 09-135, the City has entered into a contract with Savannah Housing Corporation for the construction of two new homes with the City providing $200,000 for site preparation and new construction with $40,000 for down payment and closing cost assistance; and WHEREAS, per Resolution No. 09-301, the City approved an amendment wherein the number of homes to be built was raised from two homes to three homes; and WHEREAS, the homes at 5849 Texas Avenue, 5901 Texas Avenue and 5910 Texas Avenue are in the process of being constructed ;and WHEREAS, there is a need to approve an additional amendment as to clarify that the funding for each of the three homes is $100,000 for site preparation, new construction and developer fees with the City providing up to $20,000 per homebuyer for down payment and closing cost assistance; and a WHEREAS, activities undertaken by the Savannah Housing Corporation must principally benefit low and moderate income persons/families as has been determined by the parties and is established under the guidelines of the Housing and Community Development Act of 1974, as amended; therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PORT ARTHUR: THAT the City Manager is authorized to execute an amendment to the contract with Savannah Housing Corporation in substantially the same form as attached hereto as Exhibit "A" wherein the City will expend HOME funds of $100,000 for site preparation, new construction and developer fees per home as to complete construction of the homes at 5849 Texas Avenue, 5901 Texas Avenue and 5910 Texas Avenue with the City also providing $20,000 per homebuyer for down payment and closing cost assistance with the homes to be constructed by April 7, 2010. 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., 2009 at a Regular Meeting of the City Council of the City of Port Arthur, Texas by the following vote: AYES: MAYOR COUNCILMEMBE NOES: ATTEST: CITY SECRETARY APPROVED FOR FORM: MAYOR APPROVED FOR AVAILABILITY OF FUNDS: DIRECTOR OF FINANCE / (~/\ dam" CITY ATTORNEY APPROVED FOR ADMINISTRATION: CITY MANAGER ~o~a f~ (' .__. ~E-~~-~1 REBECCA UNDERHILL, ASST. CITY MANAGER ATTACHMENT 1 AMENDMENT NUMBER TWO Whereas, the City of Port Arthur and Savannah Housing Corporation entered into an agreement that was approved by Resolution No. 09-135 as to construct two (2) new homes for low to moderate income persons by April 7, 2010 with the City providing HOME funds in the amount of $100,000 per home and with the City providing up to $40,000 in down payment and closing cost assistance and Whereas, the City of Port Arthur and Savannah Housing Corporation entered into Amendment Number One wherein Savannah Housing Corporation agreed to build three homes and Whereas, Savannah Housing is in the process of constructing homes at 5849 Texas Avenue, 5901 Texas Avenue and 5910 Texas Avenue; and Whereas, there is an need to clarify the financial assistance via HOME funds that the City is providing as well as down payment and closing cost assistance; and The parties agree as follows: 1. For each home, the City will be providing HOME funds in the amount of $100,000 per home for a total of $300,000. 2. For each homebuyer, the City will provide up to $20,000 in down payment and closing cost assistance not to exceed $60,000. 3. 4. 5 The budget per home from HOME FUNDS will be the following: Site Preparation and new construction Developer's fees $95,000 $ 2,500 upon 50 % completion of construction $ 2,500 upon receipt of final certificate of occupancy and invoice from Savannah Housing Corporation The city will also provide the following per homebuyer Down payment and closing cost Assistance $ 20,000-CITY FUNDS The homes at 5849 Texas Avenue, 5901 Texas Avenue and 5910 Texas Avenue will be completed by April 7, 2010 with the City receiving applicable certificates of final completion and affidavits that all contractors and subcontractors have been paid. 6. Each home will be at least 1,275 square feet. 7. Savannah Housing will work closely with Tejano Center to facilitate the First Time Homebuyer Program which includes homebuyer orientation and education classes, credit and budget workshops, one on one counseling, pre-purchase and post-purchase counseling. 8. All costs above the contract amount incurred by Savannah Housing Corporation shall be paid for with private or other funds. 9. All costs and developer fees delineated are subject to federal statutes, Code of Federal Regulations and HUD guidelines as to CHDO activities and shall not exceed such guidelines, and any provision of fees in excess thereof are void 10. As much as 50% to 80% of the new construction homes shall be Energy STAR qualified homes in accordance with the Leadership in Energy & Environmental Design (LEEDS), Green Building Systems. 11. Prior to the completion of the homes, the eligibility of the buyers shall be certified and approved by the City. 12. All homes shall have a ten year builder's warranty on the foundation, two (2) years warranty on the mechanical equipment and one (1) year warranty on the workmanship. 13. The goals for female business enterprises is 6.9 % and for minority business enterprises is 22.6 %. 14. Savannah Housing Corporation shall return to the City any unused funds and any income or monies derived the sale of each home less closing costs. Said monies shall be repaid to the City at the time of the closing. SIGNED AND AGREED TO ON THE SIGNED AND AGREED TO ON THE DAY OF 2009 CIiY OF PORT ARTHUR BY STEPHEN FITZGIBBONS, CITY MANAGER DAY OF 2009 SAVANNAH HOUSING CORPORATION BY SINCLAIR OUBRE EXECUTIVE DIRECTOR