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HomeMy Public PortalAbout2009 CC RES 09-059RESOLUTION NO. 09-059 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARSON, CALIFORNIA, AUTHORIZING AND APPROVING THE SUBMISSION OF AN APPLICATION FOR FUNDING FROM THE STATE OF CALIFORNIA NEIGHBORHOOD STABILIZATION PROGRAM (NSP), AND THE EXECUTION OF A GRANT AGREEMENT WITH THE STATE AND A JOINT AGREEMENT WITH THE CITY OF LYNWOOD AND TAKING OTHER ACTIONS IN CONNECTION THEREWITH. WHEREAS, in response to a nationwide housing foreclosure crisis and the negative effects of these foreclosures on the stability of residential neighborhoods throughout the nation, the United States Congress passed the Housing and Economic Recovery Act of 2008, which provided a nationwide special allocation of $3.92 billion in Community Development Block Grant funding, known as the Neighborhood Stabilization Program (NSP), to enable state and local jurisdictions to finance, purchase, acquire, or redevelop abandoned and foreclosed homes, with the objective of stabilizing residential neighborhoods and stemming the decline in residential property values as a result of widespread foreclosures; and WHEREAS, the United States Department of Housing and Urban Development has provided $530 million in NSP funding for use throughout California; $385 million of that funding was provided directly to selected city and county governments, and $145 million has been provided to the California Department of Housing and Community Development ( "HCD ") for distribution among the remaining California local jurisdictions; and WHEREAS, the HCD has informed the City of Carson that the City qualifies for NSP funds in the amount of $1,329,065.00; and WHEREAS, the City of Carson is permitted to help other jurisdictions implement their NSP funds to the extent said jurisdictions receive an amount less than $1,000,000.00; and WHEREAS, the City of Carson desires to enter into the joint agreement with the City of Lynwood in the form attached hereto as Exhibit A and by this reference incorporated herein (the "Agreement ") to effectuate its administration and implementation of the Lynwood grant; and WHEREAS, the City of Carson has held public hearings on April 2, 2009 and May 19, 2009, as well as an additional public meeting on April 30, 2009, to obtain input from the public into the proposed program; WHEREAS, the City of Carson has prepared an application to the State incorporating all the requirements of the NSP program (the "Application "); NOW, THEREFORE, the City Council of the City of Carson hereby finds and resolves: Section 1. The City Council has reviewed and hereby approves the Application (and its contents) for up to $1,329,065.00 for Carson and $916,161 for Lynwood for the following activities: Purchase and rehabilitation of homes and residential properties that have been abandoned and foreclosed upon, in order to sell such homes to income - eligible purchasers. These activities are to be performed throughout the geographic boundaries of the City of Carson and the City of Lynwood. If any additional NSP funding becomes available at a later date, the City of Carson is authorized to apply for, and /or accept funding, up to the maximum amount available under the NSP allocation. Any additional NSP funding will be used in accordance with funding requirements established by the State of California Neighborhood Stabilization Program. Section 2. The City Council hereby authorizes the City to submit a joint NSP application in collaboration with the City of Lynwood, and accepts the role of Lead Agency for the activities under this joint NSP Application. The City Council hereby approves the Agreement and authorizes the City Manager or the Mayor to enter into and execute the Agreement for and on behalf of the City. Section 3. The City Council has determined that federal Citizen Participation requirements were met during the development of this application. Section 4. The City Council hereby approves the relocation plan attached hereto as Exhibit "B" and by this reference incorporated herein which plan is required for the Application. Section 5. The City Manager or the Economic Development General Manager is hereby authorized and directed to act on the City's behalf in all matters pertaining to the Application, including the execution of the State of California's Standard Agreement or other Agreement with the State related to the funding. Section 6. If the application is approved, the City Manager or the Economic Development General Manager is authorized to enter into and sign the grant agreement, and any subsequent amendments thereto, with the State of California for the purposes of this grant. Section 7. If the application is approved, the City Manager, the Economic Development General Manager, or the Housing and Neighborhood Development Manager are authorized to sign Funds Requests and other required reporting forms. Section 8. This action is not a "project" under the California Environmental Quality Act ( "CEQA ") Guideline 15378(b)(4) and the activities proposed under the Application are exempt from CEQA pursuant to CEQA Guideline 15301. 2008. Section 9. This Resolution supplements Resolution No. 08 -150 adopted on December 2, Section 10. This Resolution shall be effective immediately upon its adoption. PASSED, APPROVED, and ADOPTED this 16th day of June, 2009 Nt;1-4.}) ayor Jim Dear ATTEST: iuv City Clerk Helen Kawagoe APPROVED AS TO FORM: City Attorney STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) ss. CITY OF CARSON ) I, Helen S. Kawagoe, City Clerk of the City of Carson, California, do hereby certify that the whole number of members of the City Council is five; that the foregoing resolution, being Resolution No. 09 -059 was duly and regularly adopted by said Council at a regular meeting duly and regularly held on the 16th day of June, 2009, and that the same was passed and adopted by the following vote: AYES: NOES: ABSTAIN: ABSENT: COUNCIL MEMBERS: COUNCIL MEMBERS: COUNCIL MEMBERS: COUNCIL MEMBERS: Mayor Dear, Davis - Holmes, Santarina, Gipson and Ruiz -Raber None None None Lt. City Clerk Helen S. awagoe JOINT COOPERATION AGREEMENT THIS AGREEMENT (this "Agreement "), made and entered into by and between the CITY OF CARSON, a municipal corporation ( "CARSON ") and the CITY OF LYNWOOD, a municipal corporation ("PARTICIPATING JURISDICTION "). WITNESSETH WHEREAS, per the Housing and Economic Recovery Act of 2008, pursuant to Title III of Division B ( "HERA "), under the heading Emergency Assistance for Redevelopment of Abandoned and Foreclosed Homes, referred to henceforth as the Neighborhood Stabilization Program (NSP), the U. S. Congress has allocated $3.92 billion for the NSP to States and units of local government with the greatest needs based on three factors: 1) Number and percentage of home foreclosures; 2) Number and percentage of homes financed by a subprime mortgage related loan; and 3) Number and percentage of homes in default or delinquent; WHEREAS, the State of California is anticipated to receive $529.6 million (13.5 percent) of the $3.92 billion in available NSP funding; WHEREAS, the State of California, as are all NSP grantees, is required to give priority emphasis in targeting NSP funding to those metropolitan areas, metropolitan cities, urban areas, rural areas, low- and moderate - income areas, and other areas with the greatest need based on U.S. Department of Housing and Urban Developments Department's ( "HUD ") three factors; WHEREAS, in CARSON and PARTICIPATING JURISDICTION abandoned and foreclosed homes have had an adverse impact to varying degrees. Specifically, those jurisdictions have been burdened with a correlated rise in blight, vandalism, illegal occupancy, code enforcement violations and declining land values as a result of abandoned and foreclosed homes and the declining housing market; WHEREAS, CARSON and PARTICIPATING JURISDICTION are located within Los Angeles County; WHEREAS, based on HUD projections, this matter is only forecasted to worsen due to relaxed underwriting standards, in the recent past, for mortgages that are due to have variable interest rates reset in the near future, thus producing an increase in mortgage defaults and eventual foreclosures; and WHEREAS, pursuant to the guidelines and requirements for obtaining and implementing NSP funding (the "NSP Guidelines ") provided by the California Department of Housing and Community Development ("HCD"), if a potential individual recipient is eligible for an allocation of less than $1,000,000 from NSP funding, then that recipient can combine with one or more other potential recipients who is eligible for an allocation of $1,000,000 or more from NSP funding so the joint allocation would exceed that $1,000,000 threshold; Exhibit A 01007/0005/67518.05 WHEREAS, CARSON is eligible for an allocation of $1,329,065 from NSP funding and Lynwood is eligible for an allocation of $916,161 and each is eligible under Tier 1 or 2 (the "NSP Grants "); and WHEREAS, CARSON and PARTICIPATING JURISDICTION desire to coordinate the receipt of the NSP funding to which each is eligible to ensure each receives their allocation for use as provided in the NSP Guidelines and to provide for CARSON as the lead agency to implement the NSP Grants and is permitted to do so pursuant to a joint agreement; and WHEREAS, this agreement covers State of California NSP requirements; and WHEREAS, CARSON and PARTICIPATING JURISDICTION have each held two public hearings prior to adoption of this Agreement; and WHEREAS, on June 16, 2009, the City Council of CARSON authorized and approved this Agreement and on June 2, 2009, the City Council of Lynwood authorized and approved this Agreement. NOW, THEREFORE, in consideration of the mutual benefits to be derived by CARSON and PARTICIPATING JURISDICTION and of the promises herein contained, it is hereby agreed as follows: 1. Lead Agency: CARSON is hereby designated as the lead entity for purposes of this Agreement, the application for NSP Grants, administration and implementation of NSP Grants and, as required by the NSP Guidelines, and shall be the direct grant recipient for the NSP Grants. CARSON shall administer and implement the portion of the NSP Grants related to PARTICIPATING JURISDICTION and, as such, PARTICIPATING JURISDICTION hereby appoints CARSON as administrator and agent for PARTICIPATING JURISDICTION with respect to the NSP Grant of PARTICIPATING JURISDICTION, as permitted and approved by governing body of PARTICIPATING JURISDICTION. 2. Grant Application. CARSON will complete and execute the State's NSP grant agreement by way of a joint application to be accompanied by an executed copy of this Agreement. All parties hereby agree to provide to CARSON in a timely manner any and all information related to their jurisdiction that is necessary to complete the joint application. 3. Responsibilities of Carson: Consistent with HUD regulations and rules, Carson assumes responsibility for administering and implementing the NSP Grants on behalf of both CARSON and PARTICIPATING JURISDICTION in compliance with applicable program requirements and the law, including but not limited to compliance with program income and rent affordability after close out of the NSP Grant. PARTICIPATING JURISDICTION hereby delegates to the extent required under the NSP program the authority to CARSON to undertake such activities. In such connection, the parties agree as follows: a. Carson shall be responsible for administering and implementing the NSP Grants and activities in accordance with NSP Guidelines. CARSON shall retain the NSP Grants and shall apply them in accordance with this Agreement, any subrecipient 01007/0005/6751 8 agreement, if any, the NSP requirements and any agreement entered into with the State of California relating to the NSP Grants. b. Carson shall use diligent efforts to expend NSP Grants related to PARTICIPATING JURISDICTION on NSP activities in accordance with NSP Guidelines; provided, however that CARSON shall not incur any liability to the extent it is unable or fails to expend all or part of the NSP Grants related to PARTICIPATING JURISDICTION. c. Each party has designated a Program Administrator under Section 10 hereof, which person shall be the contact person for CARSON'S Program Administrator to coordinate with from each PARTICIPATING JURISDICTION in carrying out its duties hereunder. CARSON, as the lead agency, shall be entitled to rely on the direction and decisions of the Program Administrator of PARTICIPATING JURISDICTION. The parties hereto shall comply with Section 8(c) hereof in implementing the NSP Grants. d. CARSON shall acquire, rehabilitate and resell foreclosed homes and undertake such other permitted activities and work under the NSP Guidelines and requirements within CARSON and PARTICIPATING JURISDICTION pursuant to the application filed with the State. Carson shall obtain all required approvals and permits for the work as requested by the Program Administrator for the applicable PARTICIPATING JURISDICTION. e. CARSON shall monitor compliance with the NSP requirements and may request information from PARTICIPATING JURISDICTION as necessary to effectuate its responsibilities under the NSP Grants. f. CARSON may engage the services of qualified consultants to assist with any portion of the administration. The selection of a consultant will follow the normal solicitation, hiring and /or bidding procedures of the City of Carson. g. CARSON shall allocate and administrate any additional funds received under the NSP program with respect to CARSON and PARTICIPATING JURISDICTION. 4. Responsibilities of all Parties. CARSON and PARTICIPATING JURISDICTION agree: a. To comply with the State of California NSP Guidelines, HUD regulations and HERA. b. To undertake or assist in undertaking activities which further the redevelopment of abandoned and foreclosed homes and residential properties, principally for persons of low and moderate income activities that may include: (i) Establishment of financing mechanisms for the purchase and redevelopment of foreclosed upon homes and residential properties, including such mechanisms as soft seconds, loan loss reserves, and shared - equity loans for low and moderate - income homebuyers; (ii) Purchase and rehabilitation of homes to sell, rent or redevelop, (iii) Establishment of land banks for 01007/0005/67518 five percent (5 %) of the amount of its allocations for its administration of the NSP Grants. homes that have been foreclosed upon; (iv) Demolition of blighted structures; or (iv) Redevelopment of demolished or vacant properties, funded from NSP Grants and from any program income generated from the expenditure of such funds. c. To undertake appropriate State and /or Federal environmental review with respect to use of NSP Grants for projects, including the National Environmental Protection Act ( "NEPA ") and /or the California Environmental Quality Act ( "CEQA "). For each project assisted with NSP Funds, CARSON shall be the lead entity for compliance purposes with NEPA and CEQA unless otherwise requested by PARTICIPATING JURISDICTION'S Program Administrator or unless otherwise requested by CARSON of PARTICIPATING JURISDICTION. d. To provide for citizen participation where appropriate and as required by the NSP Guidelines and /or the U.S. Department of Housing and Urban Development in their respective jurisdictions, including public noticing and public hearings as permitted by HCD. e. To account for and provide appropriate records relating to approval and use of funds pursuant to NSP Guidelines, HUD regulations and HERA. f. To only use the NSP Grants for the benefit of low, moderate and middle income individuals and families pursuant to NSP Guidelines and HUD regulations. g. Each party is obligated to take all actions necessary to assure compliance with the certification required by section 104(b) of Title I of the Housing and Community Development Act of 1974, as amended, including Title VI of the Civil Rights Act of 1964, the Fair Housing Act, section 109 of Title I of the Housing and Community Development Act of 1974, and other applicable laws. h. Each party is prohibited from using any portion of the NSP Grant for any activity in, or in support of, any action or program that does not affirmatively further fair housing within its own jurisdictions or any of the jurisdictions or that impedes CARSON'S actions to comply with its fair housing certification. i. To enter into subrecipient agreements as required by NSP Guidelines, if necessary. The City Manager of PARTICIPATING JURISDICTION and CARSON or the officer authorized to enter into this Agreement is hereby authorized to enter into and execute any subrecipient agreement with CARSON with respect to the NSP Grants. j. Each party agrees to comply with all Federal, State and local laws, ordinances, rules and regulations governing NSP. 5. Program Costs. 8. Additional Compliance. The parties hereto agree as follows. a. This Agreement shall remain in effect until the NSP Grant funds and program income received are expended and the funded activities completed. b. This Agreement cannot be terminated and neither CARSON nor PARTICIPATING JURISDICTION and no party may withdraw from it while it remains in effect. c. None of the parties hereto has authority to veto or otherwise restrict obstruct the implementation of the approved State NSP application during the period covered by either party's NSP agreement with the State. d. Pursuant to 24 CFR 570.501(b), each party is subject to the same requirements applicable to subrecipients, including the requirement of a written agreement as described in 24 CFR 570.503. 9. Amendment. This Agreement may be amended or modified only by mutual written consent of PARTICIPATING JURISDICTION and CARSON and only if such amendment and modification is consistent with the requirements of the NSP. Modifications clarifying NSP program requirements may be entered into by the Program Administrators of CARSON and each PARTICIPATING JURISDICTION without the requirement of action of the applicable city council on the modification. 10. Notices and Program Administrator. Any correspondence, communication, or contact concerning this Agreement shall be directed to the Program Administrator at each party at following addresses: LYNWOOD Roger Haley, Program Administrator City of Lynwood 11330 Bullis Road Lynwood, CA 90262 Phone: 310/603-0220 Ext. 200 Email: rhaley @lynwood.ca.us CARSON: Jerome G. Groomes, Program Administrator City of Carson 1 Civic Plaza Drive, Suite 500 Carson, CA 90745 Phone: 310/952 -1729 Email: jgroomes @carson.ca.us 01007/0005/67518 11. Indemnification. CARSON and PARTICIPATING JURISDICTION agree as follows: a. CARSON and its officers or employees or agents shall not be responsible for any damage or liability occurring by reason of any acts or omissions on the part of PARTICIPATING JURISDICTION or each of their officers or employees or Agents under or in connection with this Agreement. It is also understood and agreed, pursuant to Government Code, Section 895.4, PARTICIPATING JURISDICTION, and each of them, shall fully indemnify, defend, and hold CARSON harmless from any liability imposed for injury (as defined by Government Code, Section 810.8) occurring by reason of any acts or omissions on the part of PARTICIPATING JURISDICTION under or in connection with any work, authority, or jurisdiction delegated to or determined to be the responsibility of PARTICIPATING JURISDICTION under this Agreement. b. PARTICIPATING JURISDICTION, with respect to each of their portion of the NSP Grants, and each jurisdictions officers or employees or agents shall not be responsible for any damage or liability occurring by reason of any acts or omissions on the part of CARSON or its officers or employees under or in connection with this Agreement. It is also understood and agreed that, pursuant to Government Code, Section 895.4, CARSON shall fully indemnify, defend, and hold PARTICIPATING JURISDICTION harmless from any liability imposed for injury (as defined by Government Code, Section 810.8) occurring by reason of any acts or omissions on the part of CARSON under or in connection with any work, authority, or jurisdiction delegated to or determined to be the responsibility of CARSON under this Agreement. 12. Governing Law. This Agreement shall be governed by the laws of the State of California. 13. Counterparts. This Agreement may be executed in counterparts. 01007/0005/67518 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers, duly authorized, by the CITY OF CARSON on June 16, 2009, and by the CITY OF LYNWOOD on June 9, 2009. CITY OF CARSON By: Jim Dear, Mayor ATTEST: Helen Kawagoe, City Clerk APPROVED AS TO FORM: By: City Attorney CITY OF LYNWOOD By: Roger Haley, City Manager ATTEST: Maria Quinonez, City Clerk APPROVED AS TO FORM: By: City Attorney 01007/0005/67518.05 ALESHIRE WYNDER, LLP ATTORNEYS AT LAW www.awattorneys.com June 12, 2009 State of California Department of Housing and Community Development Division of Financial Assistance Neighborhood Stabilization Program 1800 Third Street, Suite 330 Sacramento, CA 95811 Orange County Offices 18881 Von 'Carman Avenue Suite 400 Irvine, California 92612 Phone 949.223.1170 Fax 949.223.1180 Los Angeles Office: South Bay Centre 1515 West 190th Street South Tower, Suite 565 Gardena, California 90248 Phone 310.527.6660 Fax 310.532.7395 Re: Joint Agreement with the cities of Lynwood and Carson for the Neighborhood Stabilization Program ( "NSP ") Funding To Whom It May Concern: In my capacity as City Attorney of the City of Lynwood (the "City ") in connection with the execution of the Joint Cooperation Agreement by and between the City and the City of Carson related to the NSP program (the "Agreement "), I have examined the Agreement, the guidelines for the NSP and a resolution adopted by the City Council of the City on June 2, 2009, as supplemented by a resolution adopted on June 9, 2009. I have assumed, without independent verification, the accurateness of all factual matters and assertions in the Agreement. Relying on such examination, assumptions and pertinent law, and subject to the limitations and qualifications hereinafter set forth, I am of the opinion that: 1. The City is a municipal corporation duly organized and validly existing under and by virtue of the Constitution and laws of the State of California. 2. The City has all necessary power and authority to enter into and perform its duties under the Agreement. 3. The Agreement has been duly authorized, executed and delivered by the City and, assuming due authorization, execution and delivery thereof by the other parties thereto, the Agreement constitutes legal, valid and binding obligation enforceable against the City in accordance with the respective terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance or other laws affecting the enforcement of creditors' rights generally and by the application of equitable principles if sought and by the limitations on legal remedies imposed on actions against cities in the State of California. 01095/0001/69220.01 State of California June 12, 2009 Page 2 I am a member of the State Bar of California. I opine only as to the laws of the State of California. This opinion is furnished to you solely to comply with the obligations of the NSP program application. This opinion is not to be used, circulated, quoted or otherwise referred to for any other purpose. Very truly yours, ALESHIRE & WYNDER, LLP Fred Galante City Attorney 01095/0001/69220.01 ALESHIRE WYNDER, LLP ATTORNEYS AT LAW www.awattorneys.com June 16, 2009 State of California Department of Housing and Community Development Division of Financial Assistance Neighborhood Stabilization Program 1800 Third Street, Suite 330 Sacramento, CA 95811 Orange County Officet 18881 Von Karman Avenue Suite 400 Irvine, California 92612 Phone 949.223.1170 Fax 949.223.1180 Los Angeles Office: South Bay Centre 1515 West 190th Street South Tower, Suitc 565 Gardena, California 90248 Phone 310.527.6660 Fax 310.532.7395 Re: Joint Agreement with the cities of Carson and Lynwood for the Neighborhood Stabilization Program ( "NSP ") Funding To Whom It May Concern: In my capacity as City Attorney of the City of Carson (the "City ") in connection with the execution of the Joint Cooperation Agreement by and between the City and the City of Lynwood related to the NSP program (the "Agreement "), I have examined the Agreement, the guidelines for the NSP and a resolution adopted by the City Council of the City on June 16, 2009. I have assumed, without independent verification, the accurateness of all factual matters and assertions in the Agreement. Relying on such examination, assumptions and pertinent law, and subject to the limitations and qualifications hereinafter set forth, I am of the opinion that: 1. The City is a municipal corporation duly organized and validly existing under and by virtue of the Constitution and laws of the State of California. 2. The City has all necessary power and authority to enter into and perform its duties under the Agreement. 3. The Agreement has been duly authorized, executed and delivered by the City and, assuming due authorization, execution and delivery thereof by the other parties thereto, the Agreement constitutes legal, valid and binding obligation enforceable against the City in accordance with the respective terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance or other laws affecting the enforcement of creditors' rights generally and by the application of equitable principles if sought and by the limitations on legal remedies imposed on actions against cities in the State of California. 01018/0005/69219.01 A&W State of California June 16, 2009 Page 2 I am a member of the State Bar of California. I opine only as to the laws of the State of California. This opinion is furnished to you solely to comply with the obligations of the NSP program application. This opinion is not to be used, circulated, quoted or otherwise referred to for any other purpose. Very truly yours, ALESHIRE & WYNDER, LLP Dawn C. Honeywell Assistant City Attorney 01018/0005/69219.01 CITY OF CARSON HOUSING REHABILITATION PROGRAM SINGLE FAMILY TEMPORARY RELOCATION PLAN The Housing and Community Development Act of 1974, as amended, and the National Affordable Housing Act of 1990, require all grantees of Community Development Block Grant (CDBG) funds / Neighborhood Stabilization Program (NSP) funds to follow a written Residential Anti - displacement and Relocation Assistance Plan (Plan) for any activities which could lead to displacement of occupants whose property is receiving funds from these or other federal funding source. Having been developed in response to both aforesaid federal legislations, this Plan is intended to inform the public of the compliance of the City of Carson with the requirements of federal regulations 24 CFR 570.606 under state recipient requirements and Section 104(d) of the Housing and Community Development Act of 1974. The Plan will outline reasonable steps, which the City will take to minimize displacement and ensure compliance with all applicable federal and state relocation requirements. The City's governing body has adopted this plan via a formal resolution. This Plan will affect rehabilitation activities funded by the U.S. Department of Housing and Urban Development (HUD) under the following program titles: CDBG, NSP and such other grants as HUD may designate as applicable, which take place with in the City limits. The City of Carson will provide permanent relocation benefits to all eligible "displaced" households either owner occupied or rental occupied units which are permanently displaced by the housing rehabilitation program (See Section E below.). In addition, the City will replace all eligible occupied and vacant occupiable low income group dwelling units demolished or converted to a use other than low income group housing as a direct result of rehabilitation activities. This applies to all units assisted with funds provided under the Housing and Community Development Act of 1974, as amended, and as described in the Federal Regulations 24 CFR 570.496(a), Relocation, Displacement and Acquisition: Final Rule dated July 18, 1990 (Section 104(d)) and 49 CFR Part 24, Uniform Relocation Assistance (URA) and Real Property Acquisition Regulations Final Rule and Notice (URA) dated March 2, 1989. All City programs /projects will be implemented in ways consistent with the City's commitment to Fair Housing. Participants will not be discriminated against on the basis of race, color, religion, age, ancestry, national origin, sex, familial status, or handicap. The City will provide equal relocation assistance available 1) to each targeted income group household displaced by the demolition or rehabilitation of housing or by the conversion of a targeted income group dwelling to another use as a direct result of assisted activities; and 2) to each separate class of targeted income group persons temporarily relocated as a direct result of activities funded by HUD programs. A. Minimizing Permanent Displacement and Temporary Relocation Resulting from Housing Rehabilitation or Reconstruction Activities: Consistent with the goals and objectives of activities assisted under the Act, the City will take the following steps to Exhibit B minimize the displacement of persons from their homes during housing rehabilitation or reconstruction funded by HUD programs: 1. Provide proper notices with counseling and referral services to all tenants so that they understand their relocation rights and receive the proper benefits. When necessary assist permanently displaced persons to find alternate housing in the neighborhood. 2. Stage rehabilitation of assisted households to allow owner occupants and /or tenants to remain during minor rehabilitation. 3. Encourage owner investors to temporarily relocate tenants to other available safe and sanitary vacant units on the project site area during the course of rehabilitation or pay expenses on behalf of replaced tenants. 4. Work with area landlords, real estate brokers, and /or hotel /motel managements to locate vacancies for households facing temporary relocation. 5. When necessary, use public funds, such as CDBG funds, to pay moving costs and provide relocation /displacement payments to households permanently displaced by assisted activities. B. Lead Based Paint Mitigation Which Causes Temporary Relocation: On September 15, 2000, the Final Rule for Lead Based Paint Hazard Control (LHC) went into effect. Among other things, it requires that federally- funded rehabilitation must use safe work practices so that occupants and workers can be protected from lead hazards. At no time should the tenant - occupant(s) be present in work areas or designated adjacent areas while LHC activities are taking place in any dwelling unit interior, common area, or exterior. As such, occupants may not be allowed to remain in their units during the time that lead -based paint hazards are being created or treated. Once work that causes lead hazards has been completed, and the unit passes clearance, the occupants can return. The tenant - occupants may not reoccupy a work area or adjacent area until post -lead hazard reduction clearance standards have been achieved and verified with laboratory results. The final rule allows for certain exceptions: 1. The work will not disturb lead -based paint, or create dust -lead or soil -lead hazard; or 2. The work is on exterior only and openings are sealed to prevent dust from entering the home, the work area is cleaned after the work is completed, and the residents have alternative lead free entry; or 3. The interior work will be completed in one period of less than 8- daytime hours and the work site is contained to prevent the release of dust into other areas of the home; or 4. The interior work will be completed within five (5) calendar days, the work site is contained to prevent the release of dust, the worksite and areas within 10 feet of the worksite are cleaned at the end of each day to remove any visible dust and debris, and the residents have safe access to kitchen and bath and bedrooms. If temporary relocation benefits are not provided because the City believes that the project meets one of the above criteria, then proper documentation must be provided in the rehabilitation project file to show compliance. It is up to the City to ensure that the owner occupant or tenant in the project does not get impacted by lead paint mitigation efforts. In most cases where lead paint mitigation is taking place, occupants (tenants or owners) will be strongly encouraged to relocate even for just a few days until a final lead clearance can be issued by a certified lead based paint assessor. Occupants who are temporarily relocated because of lead based paint mitigation are entitled to the same relocation benefits as those who are relocated because of substantial rehabilitation or reconstruction activities. C. Temporary Relocation of Owner Occupants: Owner occupants are not allowed to stay in units which are hazardous environments during lead based paint mitigation. When their home is having lead based paint mitigation work done which will not make it safe to live in, then they are eligible for temporary relocation benefits up to $500, which will be provided as a grant. In the same way, a unit requiring substantial rehabilitation (with or without lead based paint mitigation) which will not allow the family to access a bath or kitchen facility, or if the unit is being demolished and reconstructed, then the family will be eligible for temporary relocation benefits up to $500, which will be provided as a grant. In no case shall the grant for temporary relocation exceed $500 for any one owner occupant. Owner occupants will be encouraged to move in with family or friends during the course of rehabilitation, since they are voluntarily participating in the program. The housing rehabilitation loan specialist and /or the rehabilitation construction specialist will complete a temporary relocation benefits form to document that the owner occupant understands that they must relocate during the course of construction and what benefits they wish to be reimbursed for as part of their relocation. D. Temporary Relocation of Residential Tenants: If continued occupancy during rehabilitation is judged to constitute a substantial danger to health and safety of the tenant or the public, or is otherwise undesirable because of the nature of the project, the tenant may be required to relocate temporarily. The program administrator or construction supervisor will make determination of the need for temporary relocation. The temporary relocation period will not exceed 180 days. All conditions of temporary relocation will be reasonable. Any tenant required to relocate temporarily will be helped to find another place to live which is safe, sanitary and of comparable value and they have the first right to move back into the original unit being rehabilitated at the same rent or lower. He or she may move in with family and friends and still receive full or partial temporary assistance based on eligible cost incurred. The housing rehabilitation loan specialist and /or the rehabilitation construction specialist will ensure that each tenant occupied unit under the program will receive a General Information Notice (GIN) (as soon as possible after a loan application is received) and the tenant will receive a Notice of Non - displacement (after loan approval), and each tenant occupied unit will have a temporary relocation benefits form completed for them. These notices will document that each tenant understands what their relocation rights are, and if they must relocate during the course of construction, that they receive the proper counseling and temporary relocation benefits. A tenant receiving temporary relocation shall receive the following: 1. Increased housing costs (e.g. rent increase, security deposits) and 2. Payment for moving and related expenses, as follows: a. Transportation of the displaced persons and personal property within 50 miles, unless the grantee determines that farther relocation is justified; b. Packing, crating, unpacking, and uncrating of personal property; c. Storage of personal property, not to exceed 12 months, unless the grantee determines that a longer period is necessary; d. Disconnection, dismantling, removing, reassembling, and reinstalling relocated household appliances and other personal property; e. Insurance for the replacement value of personal property in connection with the move and necessary storage; f. The replacement value of property lost, stolen or damaged in the process of moving (not through the fault of the displaced person, his or her agent, or employee) where insurance covering such Toss, theft or damage is not reasonably available; g. Reasonable and necessary costs of security deposits required to rent the replacement dwelling; h. Any costs of credit checks required to rent the replacement dwelling; i. Other moving related expenses as the grantee determines to be reasonable and necessary, except the following ineligible expenses: 1) Interest on a loan to cover moving expenses; or 2) Personal injury; or 3) Any legal fee or other cost for preparing a claim for a relocation payment or for representing the claimant before the Grantee; or 4) Costs for storage of personal property on real property already owned or leased by the displaced person before the initiation of negotiations. E. Rehabilitation Activities Requiring Permanent Displacement: The City rehabilitation program will not typically trigger permanent displacement and permanent displacement activities fall outside of the scope of this plan. If a case of permanent displacement is encountered, then the staff responsible for the rehabilitation program will consult with City legal counsel to decide if they have the capacity to conduct the permanent displacement activity. If local staff does not have the capacity, then a professional relocation consultant will be hired to do the counseling and benefit determination and implementation. If local staff does wish to do the permanent displacement activity then they will consult and follow the HUD Relocation Handbook 1378. F. Record Keeping and Relocation Disclosures /Notifications: The City will maintain records of occupants of Federally funded rehabilitated, reconstructed or demolished property from the start to completion of the project to demonstrate compliance with section 104(d), URA and applicable program regulations. Each rehabilitation project, which dictates temporary or permanent or replacement activities, will have a project description and documentation of assistance provided. (See sample forms in HUD Relocation Handbook 1378, Chapter 1, Appendix 11, form HUD - 40054) Appropriate advisory services will include reasonable advance written notice of (a) the date and approximate duration of the temporary relocation; (b) the address of the suitable, decent, safe, and sanitary dwelling to be made available for the temporary period; (c) the terms and conditions under which the tenant may lease and occupy a suitable, decent, safe, and sanitary dwelling. Notices shall be written in plain, understandable primary language of the persons involved. Persons who are unable to read and understand the notice (e.g. illiterate, foreign language, or impaired vision or other disability) will be provided with appropriate translation /communication. Each notice will indicate the name and telephone number of a person who may be contacted for answers to questions or other needed help. The notices and process below is only for temporary relocation. If permanent relocation is involved then other sets of notice and noticing process and relocation benefits must be applied (See HUD relocation handbook 1378 for those forms and procedures) The Temporary Relocation Advisory Notices to be provided are as follows: 1. General Information Notice: As soon as feasible when an owner investor is applying for Federal financing for rehabilitation, reconstruction, or demolition, the tenant of a housing unit will be mailed or hand delivered a General Information Notice that the project has been proposed and that the tenant will be able to occupy his or her present house upon completion of rehabilitation. The tenant will be informed that the rent after rehabilitation will not exceed current rent or 30 percent of his or her average monthly gross household income. The tenant will be informed that if he or she is required to move temporarily so that the rehabilitation can be completed, suitable housing will be made available and he or she will be reimbursed for all reasonable extra expenses. The tenant will be cautioned that he or she will not be provided relocation assistance if he or she decides to move for personal reasons. 2. Notice of Non Displacement: As soon as feasible when the rehabilitation application has been approved, the tenant will be informed that they will not be permanently displaced and that they are eligible for temporary relocation benefits because of lead based paint mitigation or substantial rehabilitation, or reconstruction of their unit. The tenant will also again be cautioned not to move for personal reasons during rehabilitation, or risk losing relocation assistance. 3. Disclosure to Occupants of Temporary Relocation Benefits: This form is completed to document that the City /County is following its adopted temporary relocation plan for owner occupants and tenants. 4. Other Relocation /Displacement Notices: The above three notices are required for temporary relocation. If the City /County is attempting to provide permanent displacement benefits then there are a number of other forms which are required. Staff will consult HUD's Relocation Handbook 1378 and ensure that all the proper notices are provided for persons who are permanently displaced as a result of housing rehabilitation activities funded by CDBG or other federal programs. City of Carson Report to Mayor and City Council June 16, 2009 Special Orders of the Day SUBJECT: PUBLIC HEARING ON THE PROPOSED SUBMISSION OF AN APPLICATION TO THE STATE OF - Fn ' ► IA FOR FUNDING UNDER THE NEIGHBORHOOD STABILIZA 0 ' ' • G ' (NSP). r/" Submitted by C . Grave Economic Development General Manager Approded by Jerome G. Groo City Manager I. SUMMARY The requested actions relate to the submission by the city of Carson of an application to the California Department of Housing and Community Development (HCD) for Neighborhood Stabilization Program (NSP) funding. NSP is a program through the U. S. Department of Housing and Urban Development (HUD) providing a special allocation of Community Development Block Grant (CDBG) funds to state and local governments to enable those jurisdictions to take a number of permitted actions to combat the effects of widespread housing foreclosures. HUD reserved $530 million for use throughout California, distributing $385 million of it directly to selected local governments, and allocating the remaining $145 million to HCD for distribution throughout the remainder of the state. Carson was not one of the local governments selected for this direct allocation from HUD, but is eligible for a portion of the $145 million allocated to HCD. The application being submitted by Carson involves a collaboration with the city of Lynwood, with Carson as the lead agency, on a joint program of bulk purchases of abandoned foreclosed homes in the two communities, rehabilitating those structures, and reselling them to income - eligible purchasers. The joint application being submitted by the two cities is for $2,245,226.00 ($1,329,065.00 for Carson and $916,161.00 for Lynwood) . II. RECOMMENDATION TAKE the following actions: 1. OPEN the Public Hearing, TAKE public testimony, and CLOSE the Public Hearing. 2. APPROVE the NSP Joint Cooperation Agreement with the city of Lynwood. 3. WAIVE further reading and ADOPT Resolution No. 09 -059, "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARSON, CALIFORNIA, AUTHORIZING AND APPROVING THE SUBMISSION City of Carson Report to Mayor and City Council June 16, 2009 OF AN APPLICATION FOR FUNDING FROM THE STATE OF CALIFORNIA NEIGHBORHOOD STABILIZATION PROGRAM (NSP), AND THE EXECUTION OF A GRANT AGREEMENT AND ANY AMENDMENTS THERETO." 4. AUTHORIZE the City Manager to sign the grant agreement, and any subsequent amendments thereto, with the State of California for the purposes of this grant. III. ALTERNATIVES TAKE another action the City Council deems appropriate. IV. BACKGROUND In previous reports from staff over the past eight months, the City Council has been apprised of the following developments: • The passage by the United States Congress of the Housing and Economic Recovery Act of 2008 (HERA), and the resulting authorization of the NSP, a nationwide special allocation of $3.92 billion in CDBG funding to enable state and local governments to finance, purchase, acquire, and redevelop abandoned and foreclosed homes with the primary objective of stabilizing residential neighborhoods and stemming the decline in residential property values as a result of widespread foreclosures; • The allocation by HUD of $530 million of that $3.92 billion nationwide appropriation for use throughout California, and the distribution of $385 million directly to selected local governments, with the remaining $145 million being allocated for HCD for distribution throughout the remainder of the state; • The publication in November of 2008 by HCD of a Substantial Amendment to its Annual Action Plan, which indicated that the city of Carson was eligible for $925,366.00 of this NSP funding (which was subsequently revised upward to $1,329,065.00). It is worth noting that in that Substantial Amendment, HCD advised interested local governments that it was requiring that submitted applications include a formal resolution adopted by that juristiction's governing body. Having been so advised, staff prepared Resolution No. 08 -150 (Exhibit No. 1), which Council approved on December 2, 2008, authorizing submission of an application. However, in guidance contained in the Notice of Funding Availability (NOFA) that HCD released on April 30, 2009, HCD spelled out a number of provisions 2 City of Carson Report to Mayor and City Council June 16, 2009 REPLACEMENT PAGES FOR CC ITEM NO. 18 HCD's application guidelines require a minimum of two public hearings; one for the Program Design phase, and one for the approval of the application submittal. Hearings for the Program Design phase were held on April 2, 2009 and May 19, 2009. An additional opportunity for public input into the Program Design phase, designated as a "public meeting ", was conducted on April 30, 2009 in conjunction with an overall public workshop on the housing foreclosure issue. The public hearing for approval of the application submittal will take place at this evening's meeting. Public notices for the April 2 public hearing and April 30 public meeting were published in both the Daily Breeze and Our Weekly. The public notice for the May 19 public hearing was posted in English and Spanish at the customary public places, including public libraries. The public notice for this evening's public hearing was published in the Daily Breeze. V. FISCAL IMPACT No impact to the General Fund. Should the City be awarded NSP funds, it will receive $1,329,065.00. While the NSP funds are considered a special allocation of CDBG funds, program guidelines require that these funds be tracked and accounted for separately from the "regular" CDBG program. VI. EXHIBITS 1. Resolution No. 08 -150 (Approved December 2, 2008). (pgs. 6 -7). 6 -16 -2009 Revised Exhibits 2. Revised Resolution No. 09 -059. (pgs. 8 -10), including: • Joint Cooperation Agreement between the city of Carson and the city of Lynwood. (pgs. 11 -22); and • City of Carson Housing Rehabilitation Program Single Family Relocation Plan (pgs. 23 -28). 3. City of Carson Real Estate Owned Acquisition, Rehabilitation, and Resale Program Guidelines (pgs. 29 -51). Document Name Prepared by: Keith Bennett, Housing & Neighborhood Development Division Id.Rev1107 4 RESOLUTION NO. 08-150 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARSON, CALIFORNIA, AUTHORINZING THE SUBMISSION OF AN APPLICATION TO THE STATE OF CALIFORNIA DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT FOR FUNDS MADE AVAILABLE TO CALIFORNIA UNDER THE UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT'S NEIGHBORHOOD STABILIZATION PROGRAM. WHEREAS, the current housing foreclosure crisis has been one of the primary economic issues of 2008; and WHEREAS, local governments throughout the nation have been concerned about the negative effects of these foreclosures on the stability of their residential neighborhoods; and WHEREAS, in response to this crisis, the United States Congress passed the Housing and Economic Recovery Act of 2008, which provided a nationwide special allocation of $3.92 billion in Community Development . Block Grant Funding, known as the Neighborhood Stabilization Program, to enable state and local jurisdictions to finance, purchase, acquire, or redevelop abandoned and foreclosed homes, with the objective of stabilizing residential neighborhoods and stem the decline in residential property values as a result of widespread foreclosures; and WHEREAS, the United States Department of Housing and Urban Development has provided $530 million in Neighborhood Stabilization Program funding for use throughout California; $385 million of that funding was provided directly to selected city and county governments, and $145 million has been provided to the California Department of Housing and Community Development for distribution among the remaining California local jurisdictions; and WHEREAS, the California Depai tinent of Housing and Community Development has published a Substantial Amendment to its Annual Action Plan which indicates that the City of Carson qualifies for Neighborhood Stabilization Program funds in the amount of $925,366; and NOW, THEREFORE, the City Council of the City of Carson hereby finds and resolves: Section 1. As part of its plan to preserve and maintain the stability of its residential neighborhoods and stem the decline in residential property values, the City Council approves the submission of an application to the California Department of Housing and Community Development for funds made available to California by the EXHIBIT NO. 1 REVISED JUNE 16, 2009 RESOLUTION NO. 09-059 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARSON, CALIFORNIA, AUTHORIZING AND APPROVING THE SUBMISSION OF AN APPLICATION FOR FUNDING FROM THE STATE OF CALIFORNIA NEIGHBORHOOD STABILIZATION PROGRAM (NSP), AND THE EXECUTION OF A GRANT AGREEMENT WITH THE STATE AND A JOINT AGREEMENT WITH THE CITY OF LYNWOOD AND TAKING OTHER ACTIONS IN CONNECTION THEREWITH. WHEREAS, in response to a nationwide housing foreclosure crisis and the negative effects of these foreclosures on the stability of residential neighborhoods throughout the nation, the United States Congress passed the Housing and Economic Recovery Act of 2008, which provided a nationwide special allocation of $3.92 billion in Community Development Block Grant funding, known as the Neighborhood Stabilization Program (NSP), to enable state and local jurisdictions to finance, purchase, acquire, or redevelop abandoned and foreclosed homes, with the objective of stabilizing residential neighborhoods and stemming the decline in residential property values as a result of widespread foreclosures; and WHEREAS, the United States Department of Housing and Urban Development has provided $530 million in NSP funding for use throughout California; $385 million of that funding was provided directly to selected city and county governments, and $145 million has been provided to the California Department of Housing and Community Development ( "HCD ") for distribution among the remaining California local jurisdictions; and WHEREAS, the HCD has informed the City of Carson that the City qualifies for NSP funds in the amount of $1,329,065.00; and WHEREAS, the City of Carson is permitted to help other jurisdictions implement their NSP funds to the extent said jurisdictions receive an amount less than $1,000,000.00; and WHEREAS, the City of Carson desires to enter into the joint agreement with the City of Lynwood in the form attached hereto as Exhibit A and by this reference incorporated herein (the "Agreement ") to effectuate its administration and implementation of the Lynwood grant; and WHEREAS, the City of Carson has held public hearings on April 2, 2009 and May 19, 2009, as well as an additional public meeting on April 30, 2009, to obtain input from the public into the proposed program; WHEREAS, the City of Carson has prepared an application to the State incorporating all the requirements of the NSP program (the "Application "); NOW, THEREFORE, the City Council of the City of Carson hereby finds and resolves: Section 1. The City Council has reviewed and hereby approves the Application (and its contents) for up to $1,329,065.00 for Carson and $916,161 for Lynwood for the following activities: COUNCIL ITEM NO. 18 EXHIBIT NO. 2 A -1 PASSED, APPROVED, and ADOPTED this 16th day of June, 2009 ATTEST: City Clerk Helen Kawagoe APPROVED AS TO FORM: City Attorney STATE OF CALIFORNIA COUNTY OF LOS ANGELES CITY OF CARSON ss. Mayor Jim Dear I, Helen S. Kawagoe, City Clerk of the City of Carson, California, do hereby certify that the whole number of members of the City Council is five; that the foregoing resolution, being Resolution No. 09 -059 was duly and regularly adopted by said Council at a regular meeting duly and regularly held on the 3rd day of June, 2009, and that the same was passed and adopted by the following vote: AYES: NOES: ABSTAIN: AB SENT: A -3 City Clerk Helen S. Kawagoe recipient can combine with one or more other potential recipients who is eligible for an allocation of $1,000,000 or more from NSP funding so the joint allocation would exceed that $1,000,000 threshold; WHEREAS, CARSON is eligible for an allocation of $1,329,065 from NSP funding and Lynwood is eligible for an allocation of $916,161 and each is eligible under Tier 1 or 2 (the "NSP Grants "); and WHEREAS, CARSON and PARTICIPATING JURISDICTION desire to coordinate the receipt of the NSP funding to which each is eligible to ensure each receives their allocation for use as provided in the NSP Guidelines and to provide for CARSON as the lead agency to implement the NSP Grants and is permitted to do so pursuant to a joint agreement; WHEREAS, CARSON and PARTICIPATING JURISDICTION have each held two public hearings prior to adoption of this Agreement; and WHEREAS, on June 2, 2009, the City Council of CARSON authorized and approved this Agreement, on June 16, 2009 and the City Council of Lynwood authorized and approved this Agreement, on June 9, 2009. NOW, THEREFORE, in consideration of the mutual benefits to be derived by CARSON and PARTICIPATING JURISDICTION and of the promises herein contained, it is hereby agreed as follows: 1. Lead Agency: CARSON is hereby designated as the lead entity for purposes of this Agreement, the application for NSP Grants, administration and implementation of NSP Grants and, as required by the NSP Guidelines, and shall be the direct grant recipient for the NSP Grants. CARSON shall administer and implement the portion of the NSP Grants related to PARTICIPATING JURISDICTION and, as such, PARTICIPATING JURISDICTION hereby appoints CARSON as administrator and agent for PARTICIPATING JURISDICTION with respect to the NSP Grant of PARTICIPATING JURISDICTION, as permitted and approved by governing body of PARTICIPATING JURISDICTION. 2. Grant Application. CARSON will complete and execute the State's NSP grant agreement by way of a joint application to be accompanied by an executed copy of this Agreement. All parties hereby agree to provide to CARSON in a timely manner any and all information related to their jurisdiction that is necessary to complete the joint application. 3. Responsibilities of Carson: Consistent with HUD regulations and rules, Carson assumes responsibility for administering and implementing the NSP Grants on behalf of both CARSON and PARTICIPATING JURISDICTION in compliance with applicable program requirements and the law, including but not limited to compliance with program income and rent affordability after close out of the NSP Grant. PARTICIPATING JURISDICTION hereby delegates to the extent required under the 2 b. To undertake or assist in undertaking activities which further the redevelopment of abandoned and foreclosed homes and residential properties, principally for persons of low and moderate income activities that may include: (i) Establishment of financing mechanisms for the purchase and redevelopment of foreclosed upon homes and residential properties, including such mechanisms as soft seconds, loan Toss reserves, and shared - equity loans for low and moderate - income homebuyers; (ii) Purchase and rehabilitation of homes to sell, rent or redevelop, (iii) Establishment of land banks for homes that have been foreclosed upon; (iv) Demolition of blighted structures; or (iv) Redevelopment of demolished or vacant properties, funded from NSP Grants and from any program income generated from the expenditure of such funds. c. To undertake appropriate State and /or Federal environmental review with respect to use of NSP Grants for projects, including the National Environmental Protection Act ( "NEPA ") and /or the California Environmental Quality Act ( "CEQA "). For each project assisted with NSP Funds, CARSON shall be the lead entity for compliance purposes with NEPA and CEQA unless otherwise requested by PARTICIPATING JURISDICTION'S Program Administrator or unless otherwise requested by CARSON of PARTICIPATING JURISDICTION. d. To provide for citizen participation where appropriate and as required by the NSP Guidelines and /or the U.S. Department of Housing and Urban Development in their respective jurisdictions, including public noticing and public hearings as permitted by HCD. e. To account for and provide appropriate records relating to approval and use of funds pursuant to NSP Guidelines, HUD regulations and HERA. f. To only use the NSP Grants for the benefit of low, moderate and middle income individuals and families pursuant to NSP Guidelines and HUD regulations. g. Each party is obligated to take all actions necessary to assure compliance with the certification required by section 104(b) of Title I of the Housing and Community Development Act of 1974, as amended, including Title VI of the Civil Rights Act of 1964, the Fair Housing Act, section 109 of Title I of the Housing and Community Development Act of 1974, and other applicable laws. h. Each party is prohibited from using any portion of the NSP Grant for any activity in, or in support of, any action or program that does not affirmatively further fair housing within its own jurisdictions or any of the jurisdictions or that impedes CARSON'S actions to comply with its fair housing certification. i. To enter into subrecipient agreements as required by NSP Guidelines, if necessary. The City Manager of PARTICIPATING 4 provisions of this Agreement are fully authorized under State of California and local law and the person signing this Agreement has authority to do so on behalf of such PARTICIPATING JURISDICTION. c. Each party hereto has adopted and is enforcing: i. A policy prohibiting the use of excessive force by law enforcement agencies within its jurisdiction against any individuals engaged in non- violent civil rights demonstrations; and ii. A policy of enforcing applicable State and local laws against physically barring entrance to or exit from a facility or location, which is the subject of such non - violent civil rights demonstrations within jurisdictions. 8. Additional Compliance. The parties hereto agree as follows. a. This Agreement shall remain in effect until the NSP Grant funds and program income received are expended and the funded activities completed. b. This Agreement cannot be terminated and neither CARSON nor PARTICIPATING JURISDICTION and no party may withdraw from it while it remains in effect. c. None of the parties hereto has authority to veto or otherwise restrict obstruct the implementation of the approved State NSP application during the period covered by either party's NSP agreement with the State. d. Pursuant to 24 CFR 570.501(b), each party is subject to the same requirements applicable to subrecipients, including the requirement of a written agreement as described in 24 CFR 570.503. 9. Amendment. This Agreement may be amended or modified only by mutual written consent of PARTICIPATING JURISDICTION and CARSON and only if such amendment and modification is consistent with the requirements of the NSP. Modifications clarifying NSP program requirements may be entered into by the Program Administrators of CARSON and each PARTICIPATING JURISDICTION without the requirement of action of the applicable city council on the modification. 10. Notices and Program Administrator. Any correspondence, communication, or contact concerning this Agreement shall be directed to the Program Administrator at each party at following addresses: LYNWOOD Lorry Hempe, Program Administrator City of Lynwood 11330 Bullis Road Lynwood, CA 90262 6 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers, duly authorized, by the CITY OF CARSON on June 16, 2009, and by the CITY OF LYNWOOD on June 9, 2009. ATTEST: Helen Kawagoe, City Clerk APPROVED AS TO FORM: By: City Attorney ATTEST: Maria Quinonez, City Clerk APPROVE By: S TO FORM- Fred a alante, City Attorney CITY OF CARSON By: Jerome G. es. City Manager G. es, City Manager CITY OF LYNWOOD Aw State of California June 16, 2009 Page 2 I am a member of the State Bar of California. I opine only as to the laws of the State of California. This opinion is furnished to you solely to comply with the obligations of the NSP program application. This opinion is not to be used, circulated, quoted or otherwise referred to for any other purpose. Very truly yours, ALESHIRE & WYNDER, LLP Dawn C. Honeywell Assistant City Attorney 01018/0005/69219.01 State of California June 12, 2009 Page 2 I am a member of the State Bar of California. I opine only as to the laws of the State of California. This opinion is furnished to you solely to comply with the obligations of the NSP program application. This opinion is not to be used, circulated, quoted or otherwise referred to for any other purpose. Very truly yours, ALESHIRE & WYNDER, LLP Fred Galante City Attorney 01095/0001/69220.01 minimize the displacement of persons from their homes during housing rehabilitation or reconstruction funded by HUD programs: 1. Provide proper notices with counseling and referral services to all tenants so that they understand their relocation rights and receive the proper benefits. When necessary assist permanently displaced persons to find alternate housing in the neighborhood. 2. Stage rehabilitation of assisted households to allow owner occupants and /or tenants to remain during minor rehabilitation. 3. Encourage owner investors to temporarily relocate tenants to other available safe and sanitary vacant units on the project site area during the course of rehabilitation or pay expenses on behalf of replaced tenants. 4. Work with area landlords, real estate brokers, and /or hotel /motel managements to locate vacancies for households facing temporary relocation. 5. When necessary, use public funds, such as CDBG funds, to pay moving costs and provide relocation /displacement payments to households permanently displaced by assisted activities. B. Lead Based Paint Mitigation Which Causes Temporary Relocation: On September 15, 2000, the Final Rule for Lead Based Paint Hazard Control (LHC) went into effect. Among other things, it requires that federally- funded rehabilitation must use safe work practices so that occupants and workers can be protected from lead hazards. At no time should the tenant - occupant(s) be present in work areas or designated adjacent areas while LHC activities are taking place in any dwelling unit interior, common area, or exterior. As such, occupants may not be allowed to remain in their units during the time that lead -based paint hazards are being created or treated. Once work that causes lead hazards has been completed, and the unit passes clearance, the occupants can return. The tenant - occupants may not reoccupy a work area or adjacent area until post -lead hazard reduction clearance standards have been achieved and verified with laboratory results. The final rule allows for certain exceptions: 1. The work will not disturb lead -based paint, or create dust -lead or soil -lead hazard; or 2. The work is on exterior only and openings are sealed to prevent dust from entering the home, the work area is cleaned after the work is completed, and the residents have alternative lead free entry; or 3. The interior work will be completed in one period of less than 8- daytime hours and the work site is contained to prevent the release of dust into other areas of the home; or construction specialist will ensure that each tenant occupied unit under the program will receive a General Information Notice (GIN) (as soon as possible after a loan application is received) and the tenant will receive a Notice of Non - displacement (after loan approval), and each tenant occupied unit will have a temporary relocation benefits form completed for them. These notices will document that each tenant understands what their relocation rights are, and if they must relocate during the course of construction, that they receive the proper counseling and temporary relocation benefits. A tenant receiving temporary relocation shall receive the following: 1. Increased housing costs (e.g. rent increase, security deposits) and 2. Payment for moving and related expenses, as follows: a. Transportation of the displaced persons and personal property within 50 miles, unless the grantee determines that farther relocation is justified; b. Packing, crating, unpacking, and uncrating of personal property; c. Storage of personal property, not to exceed 12 months, unless the grantee determines that a longer period is necessary; d. Disconnection, dismantling, removing, reassembling, and reinstalling relocated household appliances and other personal property; e. Insurance for the replacement value of personal property in connection with the move and necessary storage; f. The replacement value of property lost, stolen or damaged in the process of moving (not through the fault of the displaced person, his or her agent, or employee) where insurance covering such Toss, theft or damage is not reasonably available; g. Reasonable and necessary costs of security deposits required to rent the replacement dwelling; h. Any costs of credit checks required to rent the replacement dwelling; i. Other moving related expenses as the grantee determines to be reasonable and necessary, except the following ineligible expenses: 1) Interest on a loan to cover moving expenses; or 2) Personal injury; or 3) Any legal fee or other cost for preparing a claim for a relocation payment or for representing the claimant before the Grantee; or 4) Costs for storage of personal property on real property already owned or leased by the displaced person before the initiation of negotiations. or she will be reimbursed for all reasonable extra expenses. The tenant will be cautioned that he or she will not be provided relocation assistance if he or she decides to move for personal reasons. 2. Notice of Non Displacement: As soon as feasible when the rehabilitation application has been approved, the tenant will be informed that they will not be permanently displaced and that they are eligible for temporary relocation benefits because of lead based paint mitigation or substantial rehabilitation, or reconstruction of their unit. The tenant will also again be cautioned not to move for personal reasons during rehabilitation, or risk losing relocation assistance. 3. Disclosure to Occupants of Temporary Relocation Benefits: This form is completed to document that the City /County is following its adopted temporary relocation plan for owner occupants and tenants. 4. Other Relocation /Displacement Notices: The above three notices are required for temporary relocation. If the City /County is attempting to provide permanent displacement benefits then there are a number of other forms which are required. Staff will consult HUD's Relocation Handbook 1378 and ensure that all the proper notices are provided for persons who are permanently displaced as a result of housing rehabilitation activities funded by CDBG or other federal programs. DRAFT Table of Content Intent of the Program Acquisition Criteria For Property Aquisition Single Family Townhome Condominium Location Target Area Non Target Area Price Determination Ordering the Appraisal Before rehabilitation Value After rehabilitation Value Letter of Intent Due - Diligence Period Check List Condition of Property RDA / NSP Determination Making the Purchase Offer Offer Forms Counter Offer Acceptance of Offer Deposit Escrow — Opening and Closing Deposit Escrow Instructions Title - City / Agency Grant Deed DRAFT Obtaining Building Permits Inspections Building Department Inspection Housing Division Inspection Other Agency's Inspection Request for Payment Authorization Processing of Payment Final Inspection Job Walk Notice of Completion Retention Payment Resale of House Sale Price Re- verify After Rehabilitation Value Cost Analysis Final Sales Price Marketing of Home For -Sale Marketing Budget Selection of a Real Estate Broker Broker Requirements Type of Listing Listing Period Home Buyer Education Requirements Selection of a Home Buyer Counselor Certificate of Completion Receiving a Purchase Offer Form Review of Offer Acceptance of Offer Resale Affordability Covenant Intent of the Program The effects of foreclosures often extend beyond the families who are displaced. Foreclosed homes become vacant and abandoned — leading to numerous problems that can decrease property values and destabilize communities. Inadequately secured and maintained, foreclosed properties can lead to increased crime, pest infestations, disorder and vandalism. Through the implementation of an Acquisition, Rehabilitation and Resale (ARR) program, the Cities is planning to bring stability to neighborhoods within their proposed target areas. The overall objective of the program is to create decent, affordable homes and rebuild the neighborhoods that have been affected by the foreclosure crisis. This will be done by purchasing foreclosed properties at a discount rate, rehabilitating the properties to meet the Cities' and HUD Housing Standards, and selling the properties to low and middle- income families at a price based on the applicant's income and ability to make payments. Specifically, the City will use funds from the NSP to facilitate the acquisition, rehabilitation and resale of abandoned or vacant and foreclosed single- family homes. The City intends to purchase units individually and/or in bulk. The City will negotiate with lenders and financial institutions to obtain a discount on the purchase of foreclosed properties. In negotiating with the lenders and financial institutions, the City of Carson will follow the required NSP purchase discount requirement of a minimum of 15 percent (15 %). All of the properties acquired through the program will be sold to households eaming 120% of Area Median Income (AMI) or below. Homebuyers will be required to own and occupy the property as their primary residence. The sale price of the property, to the homebuyer, will be no greater than the total cost for acquisition, rehabilitation, and holding costs. , Eligible homebuyers will be required to attend a HUD certified, 8 -hour pre- acquisition home ownership class. In addition, homebuyers will also be required to obtain a conventional mortgage loan, at a fixed interest rate. Homes purchased will be required to maintain a 15 -year affordability covenant. If the home is sold within the 15 -year period, then the full loan amount will be recaptured plus a declining equity share based upon the length of homeownership. REO Acquisition Guidelines Page 1 of 17 City of Carson DRAFT The LOI will also stipulate the city's access to the property to conduct further due diligence. The city will have 10 business days from receipt of the appraisal to decide to proceed with the acquisition. Price Determination Ordering the Appraisal Staff will initiate and request an appraisal of the property following the execution of the LOI between the city and the lender The purpose of the appraisal is to determine the value for the property, the city, utilizing NSP funds will pay up to 85% of the appraised value for the property. Before Rehab Value and After Rehab Value The appraiser will establish, through analysis, the before rehabilitation value and the after rehabilitation value. For the purposes of determining which funding source to use when proceeding to the close of the transaction A moderate acquisition and rehabilitation, means the value of which constitutes less than 25 % of the after rehabilitation value of the dwelling. For properties that, after analysis, have been determined to meet less than the 25% after rehabilitation value test, NSP funds will be expended A substantial acquisition and rehabilitation, means the value of which constitutes 25% of the after rehabilitation value of the dwelling. For properties that, after analysis, have been determined to meet the 25% of after rehabilitation value, redevelopment agency housing funds will be expended. The appraisal process should be completed within 10 days of initiating the request for appraisal. Due - Diligence Period Check List During the 10 day LOI period the city's housing rehabilitation inspector will initiate and complete a physical inspection of the property to determine the condition of the property. Condition of Property REO Acquisition Guidelines Page 3 of 17 City of Carson DRAFT Escrow Documents The escrow holder will provide the necessary instructions for review and approval to both purchase and seller. All documents should be returned to escrow agent within 5 business days. City staff will review the existing record of title to the property and will request a CLTA policy to properly insuring the city of any defects in the existing title. Grant Deed A grant deed will be prepared by the escrow agent identifying the city or redevelopment agency as the correct owner. The type of funding for the acquisition will determine the grantee for the property. If the City uses NSP for the deposit and acquisition dollars for the site the city will execute the escrow instructions and retain the grant deed. If the redevelopment agency provides the funding, the Agency will execute and retain the grant deed. Close of Escrow The escrow will close within 30 days from the date of the purchase agreement, unless another date, sooner than 30 days, is stipulated in the purchase agreement Securing the Site Fencing Once the escrow is closed the site will be secured by the city. The security may include a temporary fence, boarding up, and or both. Signage A sign indicating the program name, city council members, and contact information will be erected on the site in clear safe visibility. The purpose of the sign is to let the community know that the city is continuing its efforts to support quality, decent, and safe housing by rehabilitating this house and that the house will be resold to a qualified family. REO Acquisition Guidelines Page 5 of 17 City of Carson DRAFT Lead Base Paint Testing Before the work description is completed by the housing inspector, the property will be inspected by a licensed Lead -Base Paint Testing Service. The testing will comply with the scope of work provided by the housing inspector and will include the following; a) Conduct lead hazard inspection/evaluation. During the evaluation, lead inspector shall determine weather lead -based paint or hazard exit in the unit and provide the location. b) Conduct paint testing of all surfaces to be disturbed during the rehabilitation process c) Provide a report indicating the findings of the paint testing d) Prepare a risk assessment in conformance with the requirements under 24 CFR Sec 35.930. e) Conduct a final clearance inspection to ensure the dwelling is safe for resale to new occupants. Clearance will include a visual assessment, dust sampling, analysis, interpretation, and the preparation of a final report. The scheduling of the lead inspection will be immediate upon receipt of the request from the Housing Division. A written report will be available in approximately 4 business days from the completion of the field inspection. Environmental Requirements NEPA and CEQA Clearance Each property will undergo a National Environmental Protection Agency Clearance (NEPA) checklist, a California Environmental Quality Act checklist, and if necessary a SHPO clearance. If through the check list process a property is determined to be exempt from further review, the property will proceed to construction, if a further review is required, the property will be pulled from the inventory and a further environmental study will proceed. Staff Cost Estimate The housing inspector will prepare a staff cost estimate based on the physical inspection, work description, interview with other divisions (building and or planning division), and the lead -base paint report. REO Acquisition Guidelines Page 7 of 17 City of Carson DRAFT Contractors will be have adequate time to efficiently review the job before returning the bid. Bids that are not complete at the time the bids are due will have their bids denied. No changes to the certified bid will be allowed. Picking -Up and Turning a Bid -In The bidding process will follow the existing bidding process utilized with the City of Carson's Housing and Commercial Rehabilitation Guidelines. Contractors will be encouraged to obtain a copy of the bidding requirements prior to picking up a bid. All bids will be picked up and returned to the City of Carson's Clerks Office. Staff Review of Contractor Bids Following the receipt of the contractor bids a registry will be created, identifying each bid, the contractor, and the amount of the bid. Staff will review the bids and will make a determination of which bid is most responsive based on the contractors cost, references, and historical performance of similar jobs. Award of Contract to General Contractor Notification All the contractors who turned in a qualified bid will be notified of the winning bidder. The review and determination of the selected contractor will be done within 10 business days of the closing bid date. Pre - Construction Conference The selected contractor will be required to attend a preconstruction meeting with the housing rehabilitation staff at the site. The purpose of the pre - construction meeting is to review any and all work to be completed, meet the contractor's key staff employees or sub - contractors, review the construction contract, and answer any questions the contractor may have Construction Contract Agreement The City will provide the necessary construction contracts for the purpose of proceeding with the construction of the property. The contractor will be required to review, approve, and adhere to the various agreements, payment procedure, and project closing documents. It is suggested that the contractor review all documents in advance of meeting with staff to sign, this should lessen the number of general questions related to the contracts. REO Acquisition Guidelines Page 9 of 17 City of Carson DRAFT responsibility's are separate and distinct. The contractor will not rely on any one agency to cover the inspection responsibility for another agency. Other Agency's Inspection There may be other inspections related to the rehabilitation work from Federal and State agencies. Request for Payment The contractor will process the request for payment following the inspection and sign -off of the item inspected by the housing inspector. The contractor should, at the beginning of the project, lay -out the payment schedule and coordinate the schedule with the inspector to avoid delays in processing a payment request. The payment structure for the contract will be on a reimbursement schedule, the contractor will start the job, start and complete more than 50% of an item, per the suggested payment schedule, and the contractor will be reimbursed, pending lien releases and inspection approvals from agencies. Authorization for Payment Following the contractors request for payment and inspection approval from the various agencies, authorization for payment will be provided to the contractor by the Economic Development General Manager or his/her designee. Processing of Contractor Payment Following the submittal of the contractors approved invoice the housing division will process the invoice for payment. The contractor will receive payment in accordance with the City of Carson Vendor Payment Schedule. Final Inspection Job Walk The contractor will notify the inspector of the completion of the job and will coordinate a job walk of the property. The job walk will allow the inspector and contractor the opportunity to identify any touch -up work, clarify any outstanding issues related to the project, and set a project completion and rap -up date for the project. If there is a need to schedule another job walk date, it will be determined at that time. Notice of Completion The contractor will provide the necessary lien releases, material warranties, stop notices, and provide certifications of surety on any labor and material bond. The Housing REO Acquisition Guidelines Page 11 of 17 City of Carson DRAFT Home Buyer Education Requirements The selected home buyer will be required to attend and complete an 8 hour home buyer educational course as part of the purchasing conditions. Selection of a Home Buyer Counselor The city will provide the buyer with a qualified counselor to complete the educational requirements. The counselor provided will be well trained and versed in credit counseling, mortgage lending, and the home buying process. Resale Affordability Covenant The City is providing the buyer with a potential home purchase below the market value of the property and as such the buyer could resale or refinance the property for a profit. This market driven opportunity creates a conflict with the intended goals of the Acquisition and Resale Program. To ensure compliance with the program and continued affordability, the city /agency will require the buyer to review and approve an Affordability Covenant as part of the purchasing requirements. The primary purpose of the affordability covenant is to insure the city, state, and federal agencies that the future occupancy of the home will be maintained at an affordable value. As part of the covenant conditions the buyer may be required to annually certify their household income. The affordability covenant will be prepared by Housing Division and delivered to the buyer, for review, at the time an offer is presented. The buyer or the buyer representative is encouraged to review the Affordability Covenant early on in the buying process. Open of Escrow Following the approval of the purchase and sale agreement by all parties the City will open escrow, escrow officer will be determined by the City. The buyers deposit will be required to open escrow. The purpose of the escrow is to formally close the sale transaction between the city and the new homeowner, to ensure title is transferred correctly, the buyers loan is closed and recorded properly, and the proceed from the sale of the property are properly disbursed. Escrow Documents The escrow documents will be prepared and disseminated to all parties. The term of the escrow will be determined during in the Purchase and Sale Agreement. REO Acquisition Guidelines Page 15 of 17 City of Carson DRAFT f) Preference will be given to agents who live and work in the City of Carson Following the receipt of the bids staff in the housing division will review the bids and determine the most qualified respondents. Type of Listing Agreement between the City and Agent The City will use an agreement similar to the Exclusive Right To Sell Agreement. The City will retain the right to alter, draft, and delete portions of the standard agreement to comply with the City's contractual responsibilities. Listing Agreement Period The Agent will receive a Listing Agreement for a period of 90 days. If the property is not sold in the 90 day period, the city will evaluate an extension or new agreement. The city will retain the right to cancel the listing at any time if the agent representative violates any portion of the representation on behalf of the city. Receiving a Purchase Offer The City will entertain offers for the purchase of the property through the agent representative. The buyer will be required to submit any and all correspondence related to the intent to purchase the property through the city's agent representative. Any and all offers will require proof of financing, a copy of the buyers credit score, and a brief description or biography of the buyers family. Offer Form of Agreement The offers submitted through the agent for purchasing consideration will be on the standard CAR form and will be accompanied by the buyer's deposit. The City of Carson will provide the final Purchase and Sale Agreement for the buyer to review and approve. Review of Offer The city will review those offers that are complete and are reflective of a qualified transaction. The city, through the agent representative will review and respond to qualified offers with a acceptable time period that will accommodate both parties. Acceptance of Offer The Agent representative will notify the buyer or the buyers agent of the city's acceptance of the buyers offer. Following the acceptance the city will prepare the final Purchase agreement which will incorporate the terms and conditions in the original offer and all counter offers. REO Acquisition Guidelines Page 14 of 17 City of Carson DRAFT will detail the proposed uses of NSP Program Income and will confirm the jurisdiction's required compliance with state and federal regulations. NSP Accounting All NSP Program Income must be maintained in a separate account(s) from any other federal funds (Le. CDBG /HOME). 1. NSP Monitoring Requirements 1. An eligible participant in the NSP program must: • Be at or below middle- income; that is with an annual (gross) income that does not exceed 120% of area median income; and • Occupy the property as a principal residence. Redevelopment Agency Reporting Requirements An eligible participant in the RDA program must: Must meet the income eligibility requirement, the gross household income cannot exceed 120% of median income established by HCD Certify that the units will be owner- occupied at all times; NSP & RDA Monitoring Documentation: • Description of source and application of funds. • Description of site location (i.e. written description and map). • Description of site (e.g. single- family residence; 2- bedroom; 1- bath). • Documentation demonstrating compliance with property standards and lead -based paint requirements. • Documentation demonstrating compliance with maximum property value and affordability requirement. • On an annual basis, the City will send homeowners an Ownership Annual Certification form to be filled out and returned to the City within 30 days of receipt. Homeowners will affirm that they are occupying the home as their principal residence. The homeowner will be required to submit copies of two current utility bills as part of the annual recertification process. REO Acquisition Guidelines Page 17 of 17 City of Carson