HomeMy Public PortalAboutA2011-02-15LRA�4
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LYNWOOD
REDEVELOPMENT
AGENCY
R GIPO4�
11330 BULLIS ROAD
LYNWOOD, CALIFORNIA 90262 -3845
(310) 603 -0220
Aide Castro, Chair
Jim Morton, Vice Chair
Alfredo Flores, Member
Ramon Rodriguez, Member
Maria T. Santillan, Member
This Agenda contains a brief general description of each item to be considered. Copies of the Staff
reports or other written documentation relating to each item of business referred to on the Agenda are on
file in the Office of the City Clerk and are available for public inspection. Materials related to an item on
this Agenda submitted to the Agency Board after distribution of the Agenda packet are available for public
inspection at the Agency Secretary's office at the above address during normal business hours. Any
person who has a question concerning any of the agenda items may call the City Manager at (310) 603-
0220, ext. 200.
AGENDA
LYNWOOD REDEVELOPMENT AGENCY
FEBRUARY 15, 2011
REGULAR MEETING
5:00 P.M.
LYNWOOD CITY HALL
11330 BULLIS ROAD
AIDE CASTRO
CHAIR
JIM MORTON
VICE CHAIR
RAMON RODRIGUEZ
MEMBER
ROGER L. HALEY
EXECUTIVE DIRECTOR
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RECEIVED
FEB 10 2011
CITY OF LYNWOOD
CITY CLERKS OFFICE
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ALFREDO FLORES
MEMBER
MARIA T. SANTILLAN
MEMBER
FRED GALANTE
AGENCY COUNSEL
OPENING CEREMONIES
A. Call Meeting to Order
B. Roll Call (FLORES- RODRIGUEZ- SANTILLAN- MORTON- CASTRO)
C Certification of Agenda Posting by Secretary
PUBLIC ORAL COMMUNICATIONS
(Regarding Agenda Items Only)
PUBLIC ORAL COMMUNICATIONS
CONSENT CALENDAR
All matters listed under the Consent Calendar will be acted upon by one motion affirming the
action recommended on the agenda. There will be no separate discussion on these items prior
to voting unless members of the Agency or staff request specific items are removed from the
consent calendar for separate action.
1 MINUTES OF THE PREVIOUS MEETING
Regular Meeting of January 18, 2011
Regular Meeting of February 1, 2011
2. RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY OF LYNWOOD,
CALIFORNIA, ALLOWING AND APPROVING THE DEMANDS AND WARRANTS
3. HOUSING REHABILITATION PROGRAM (HRP) GUIDELINES - CLARIFYING PROJECT
ELIGIBILITY AND REVISED MAXIMUM ASSISTANCE
Comments:
An amended HRP- Program Guidelines is presented for Council consideration to address
HOME statutory requirements which are not contained within the current guidelines and to
provide greater clarity to the HRP's operating parameters and framework. The revised
guidelines also expand the program by incorporating the potential use of Agency Low- and
Moderate Income Housing Set -aside funds (LMIHF).
Recommendation:
Staff recommends that the City Council and the Agency adopt the attached resolution
entitled: "A JOINT RESOLUTION THE CITY COUNCIL AND LYNWOOD
REDEVELOPMENT AGENCY OF THE CITY OF LYNWOOD APPROVING AMENDMENTS
TO THE HOUSING REHABILITATION PROGRAM GUIDELINES'
CLOSED SESSION
NONE
ADJOURNMENT
THE NEXT REGULAR MEETING WILL BE HELD ON MARCH 1, 2011 AT 5:00 P.M. AT THE
COUNCIL CHAMBERS OF CITY HALL, 11330 BULLIS ROAD, LYNWOOD, CALIFORNIA.
0 AGENDA STAFF REPORT
DATE. February 15, 2011
TO Honorable Chair and Members of the Agency
APPROVED BY Roger L. Haley, Executive Directd_�
PREPARED BY Maria Quinonez, Secretary
Kristina Santana, Deputy City Cle I-5
SUBJECT Lynwood Redevelopment Agency Minutes
Recommendation:
Staff recommends that the Lynwood Redevelopment Agency approve the
following minutes.
• Regular Meeting —January 18, 2011
• Regular Meeting —February 1, 2011
Background: N/A
Discussion & Analysis: N/A
Fiscal Impact: N/A
Coordinated With: N/A
ITEM
LYNWOOD REDEVELOPMENT AGENCY
REGULAR MEETING
January 18, 2011
The Lynwood Redevelopment Agency of the City of Lynwood met in a regular meeting
in the Council Chambers, 11330 Bullis Road on the above date at 5:32 p.m.
Chairman Castro presiding.
Members Rodriguez, Santillan, Morton and Castro and were present.
Member Flores was absent.
Also present were Executive Director Haley, Agency Counsel Galante, Secretary
Quinonez and Treasurer Alatorre.
Secretary Quinonez announced that the Agenda had been posted in accordance with
the Brown Act.
PUBLIC ORAL COMMUNICATIONS
(Regarding Agenda Items Only)
l RIN
PUBLIC ORAL COMMUNICATIONS
NONE
CONSENT CALENDAR
It was moved by Member Rodriguez, seconded by Chair Castro, to approve the consent
calendar and to receive and file staff reports.
AYES MEMBERS, RODRIGUEZ, SANTILLAN, MORTON AND CASTRO
NOES NONE
ABSTAIN. NONE
ABSENT MEMBER FLORES
Item #1. MINUTES OF THE PREVIOUS MEETINGS.
Regular Meeting of December 21, 2010 (CORRECTION)
Regular Meeting of January 4, 2011
Item #2. RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY OF
LYNWOOD, CALIFORNIA, ALLOWING AND APPROVING THE
DEMANDS AND WARRANTS
RESOLUTION NO. 2011.002 ENTITLED:
RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY OF LYNWOOD,
CALIFORNIA, ALLOWING AND APPROVING THE DEMANDS AND WARRANTS
Item #3. LYNWOOD REDEVELOPMENT AGENCY'S FINANCIAL
TRANSACTIONS REPORT TO THE STATE CONTROLLER FOR
FISCAL YEAR 2009 -2010
Report received and filed.
Item #4. PROFESSIONAL SERVICES AGREEMENT WITH MG RESOLUTIONS,
INC ENVIRONMENTAL CONSULTING SERVICES REGARDING THE
PROJECT AT LONG BEACH AND IMPERIAL WITH DEVELOPER M &A
GABAEE
Member Santillan abstained from this item.
RESOLUTION NO. 2011.003 ENTITLED:
A RESOLUTION OF THE AGENCY BOARD OF THE LYNWOOD REDEVELOPMENT
AGENCY AMENDING RESOLUTION 2010.058 AND APPROVING THE REVISED
CONSULTING SERVICES AGREEMENT WITH MG RESOLUTIONS INC FOR THE
PREPARATION OF THE ANALYSIS UNDER THE CALIFORNIA ENVIRONMENTAL
QUALITY ACT REGARDING THE PROPOSED PROJECT AT LONG BEACH AND
IMPERIAL WITH DEVELOPER M&A GABAEE
CLOSED SESSION
N 0 - Mk
ADJOURNMENT
Having no further discussion, it was moved by Member Rodriguez, seconded by Vice -
Chair Morton and carried to adjourn the regular Lynwood Redevelopment Agency
meeting at 5:33 p.m.
Aide Castro, Chair
Maria Quinonez, Secretary
LYNWOOD REDEVELOPMENT AGENCY
REGULAR MEETING
February 1, 2011
The Lynwood Redevelopment Agency of the City of Lynwood met in a regular meeting in
the Council Chambers, 11330 Bullis Road on the above date at 6 p.m.
Chairman Castro presiding.
Members Flores, Rodriguez, Santillan, Morton and Castro and were present.
Also present were Executive Director Haley, Agency Counsel Galante, Secretary
Quinonez and Treasurer Alatorre.
Secretary Quinonez announced that the Agenda had been posted in accordance with the
Brown Act.
PUBLIC ORAL COMMUNICATIONS
(Regarding Agenda Items Only)
NONE
PUBLIC ORAL COMMUNICATIONS
NONE
CONSENT CALENDAR
It was moved by Member Santillan, seconded by Vice Chair Morton, to approve the
consent calendar and to receive and file staff reports.
AYES: MEMBERS FLORES, RODRIGUEZ, SANTILLAN, MORTON AND
CASTRO
NOES NONE
ABSTAIN: NONE
ABSENT NONE
Item #1. RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY OF
LYNWOOD, CALIFORNIA, ALLOWING AND APPROVING THE
DEMANDS AND WARRANTS
RESOLUTION NO. 2011.004 ENTITLED:
RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY OF LYNWOOD,
CALIFORNIA, ALLOWING AND APPROVING THE DEMANDS AND WARRANTS
Item #2. Member Rodriguez pulled Item #2 — TREASURER'S QUARTERLY
INVESTMENT REPORT
It was moved by Member Rodriguez, seconded by Vice Chair Morton, to discuss item #2
jointly with Item #16 of the City Council agenda and Item #5 of the Lynwood Public
Finance Authority agenda.
It was moved by Chair Castro, seconded by Member Flores, to approve staff
recommendation and receive and file the report.
AYES MEMBERS FLORES, RODRIGUEZ, SANTILLAN, MORTON AND
CASTRO
NOES NONE
ABSTAIN: NONE
ABSENT NONE
Item #3. Member Rodriguez pulled Item #3 — TREASURER'S INVESTMENT
POLICY STATEMENT
It was moved by Member Rodriguez, seconded by Vice President Morton, to discuss item
#3 jointly with Item #17 of the City Council agenda and Item #6 of the Lynwood Public
Finance Authority agenda.
It was moved by Chair Castro, seconded by Member Santillan, to approve staff
recommendation.
RESOLUTION NO. 2011.005 ENTITLED:
A RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY OF THE
CITY OF LYNWOOD APPROVING THE TREASURER'S INVESTMENT POLICY
STATEMENT
AYES. MEMBERS FLORES, RODRIGUEZ, SANTILLAN, MORTON AND
CASTRO
NOES NONE
ABSTAIN: NONE
ABSENT NONE
Item #4. Agency Counsel pulled Item #4 — DISCRETIONARY INVESTMENT
MANAGEMENT AGREEMENT
Agency Counsel Fred Galante stated that the resolution should state, "the agreement be
approved subject to the City Attorney's approval of the form"
Chair Castro convened Item #4 with Item #18 of the City Council agenda and Item #7
from the Lynwood Public Finance Authority agenda.
It was moved by Chair Castro, seconded by Vice Chair Morton, to approve staff
recommendation with the correction to the resolution by the City Attorney
The motion died on the floor
2
After discussion by Council, it was moved by Vice Chair Morton, seconded by Chair
Castro, to approve staff recommendation.
RESOLUTION NO. 2011.006 ENTITLED:
A RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY OF THE CITY OF
LYNWOOD TO EXECUTE THE DISCRETIONARY MANAGEMENT AGREEMENT WITH
MAIN STREET CAPITAL ADVISORS, LLC
AYES:
MEMBERS FLORES, RODRIGUEZ, SANTILLAN, MORTON AND
CASTRO
NOES
NONE
ABSTAIN:
NONE
ABSENT
NONE
Item #5. Member Rodriguez pulled Item #5 — AUTHORIZATION TO ISSUE
LYNWOOD REDEVELOPMENT AGENCY TAX ALLOCATION BONDS
(PROJECT AREA A), 2011 SERIES A AND LYNWOOD
REDEVELOPMENT AGENCY TAXABLE TAX ALLOCATION BONDS
(HOUSING PROJECTS), 2011 SERIES B
It was moved by Member Rodriguez, seconded by Vice Chair Morton, to discuss item #5
jointly with Item #10 of the City Council agenda and Item #4 of the Lynwood Public
Finance Authority agenda.
It was moved by Vice Chair Morton, seconded by Member Santillan, to approve staff
recommendation.
Agency Counsel Fred Galante stated that procedural requirements require the agencies
to act on this item as new business and not under consent calendar He then read the
titles of the resolutions for procedural purposes.
Chair Castro stated that this item was supposed to be a new business item and not a
consent calendar item.
Project Area A — Subordinate Lien 2011 Series A
RESOLUTION NO. 2011.007 ENTITLED:
A RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY AUTHORIZING
THE ISSUANCE AND SALE OF TAX ALLOCATION BONDS TO FINANCE
REDEVELOPMENT ACTIVITIES WITHIN OR FOR THE BENEFIT OF THE AGENCY'S
PROJECT AREA A, APPROVING THE FORM AND AUTHORIZING EXECUTION OF
RELATED DOCUMENTS AND AUTHORIZING OFFICIAL ACTIONS
Housing Projects- Subordinate Lien 2011 Series B
RESOLUTION NO. 2011.008 ENTITLED:
A RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY AUTHORIZING
THE ISSUANCE AND SALE OF TAXABLE TAX ALLOCATION BONDS TO FINANCE
LOW AND MODERATE INCOME HOUSING ACTIVITIES WITHIN THE GEOGRAPHIC
BOUNDARIES OF THE CITY OF LYNWOOD, APPROVING THE FORM AND
AUTHORIZING EXECUTION OF RELATED DOCUMENTS AND AUTHORIZING
OFFICIAL ACTIONS
RESOLUTION NO. 2011.009 ENTITLED:
A RESOLUTION OF THE LYNWOOD REDEVELOPMENT AUTHORIZING THE USE OF
LOW AND MODERATE INCOME HOUSING FUNDS FROM ANY PROJECT AREA TO
BE USED ON LOW AND MODERATE INCOME HOUSING PROJECTS CITYWIDE AND
MAKING BENEFIT FINDINGS IN CONNECTION THEREWITH
RESOLUTION NO. 2011.010 ENTITLED:
A RESOLUTION OF THE LYNWOOD REDEVELOPMENT AGENCY AUTHORIZING
THE INVESTMENT OF BOND PROCEEDS IN THE LOCAL AGENCY INVESTMENT
FUND
AYES: MEMBERS FLORES, RODRIGUEZ, SANTILLAN, MORTON AND
CASTRO
NOES: NONE
ABSTAIN: NONE
ABSENT NONE
CLOSED SESSION
Agency Counsel Fred Galante announced that an item of anticipated litigation in
which the Redevelopment Agency holds a lien hold interest, had come to the
Agency's attention after the posting of the agenda. He stated that the Agency
received a demand from the owner and the Agency could be subject to litigation.
It was moved by Mayor Pro Tern Morton, seconded by Council Member Flores to
add the item to the Lynwood Redevelopment Agency Closed Session Agenda.
AYES: MEMBERS FLORES, RODRIGUEZ, SANTILLAN, MORTON AND
CASTRO
NOES NONE
ABSTAIN: NONE
ABSENT NONE
Item #6. WITH RESPECT TO EVERY ITEM OF BUSINESS TO BE DISCUSSED IN
CLOSED SESSION PURSUANT TO SECTION 54956.9
CONFERENCE WITH LEGAL COUNCIL
Anticipated litigation
One case pursuant to government code section 54956.9
The Lynwood Redevelopment Agency held a discussion and no reportable action
was taken.
ADJOURNMENT
Having no further discussion, the regular Lynwood Redevelopment Agency meeting was
adjourned at 8:07 p.m. with a moment of silence in honor of Sergeant Hellmold, Captain
Hellmold's father in his passing.
Aide Castro, Chair
Maria Quinonez, Secretary
5
AGENDA STAFF REPORT
DATE. February 15, 2011
TO Honorable Chairperson and Members of the Agency Board
APPROVED BY Roger L. Haley, Executive Direct
PREPARED BY Robert S Torrez, Assistant City Manager
Monica Ochoa, Accounting Techniciana(
SUBJECT Approval of the Warrant Register
Recommendation:
Staff respectfully recommends that the Agency Chairperson and Board Members
approve the warrant register for Fiscal Year 2010 -2011
Attached Warrant Register dated February 15, 2011
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AGENDA STAFF REPORT
DATE. February 15, 2011
TO Honorable Mayor and Members of the City Council
Honorable Chair and Members of the Agency Board
APPROVED BY Roger L. Haley, City Manager /Executive Dire
PREPARED BY Sarah Magaha Withers, Director of Redevelop
SUBJECT Housing Rehabilitation Program Guidelines - Clarifying
Project Eligibility and Revised Maximum Assistance
Recommendation:
Staff recommends that the City Council adopt the attached resolution entitled: "A
JOINT RESOLUTION OF THE CITY COUNCIL AND LYNWOOD
REDEVELOPMENT AGENCY OF THE CITY OF LYNWOOD APPROVING
AMENDMENTS TO THE HOUSING REHABILITATION PROGRAM
GUIDELINES"
Background:
The City of Lynwood has conducted a Housing Rehabilitation Program (HRP)
since 1975, providing funding for lower- income (80% of area median income)
owner - occupied properties in need of repair The HRP is currently funded from
the City's federal Home Investment Partnerships Program (HOME) allocation,
with program requirements detailed within the City's current HOME mandated
Program Guidelines and Procedures.
On February 21, 2006, the City Council had approved an amendment to the
program by adoption of Resolution 2006.028, which addressed:
1 Updating the guidelines to meet HUD standards
2. Limited the $10,000 grant amount to correcting code violations and /or
abate lead hazards. and /or pest control.
3. Increased the program loan amount from $30,000 to $65,000, subject
to:
a. One -third of the loan amount being applied to the exterior of
residence.
b Loans to carry a 0% interest rate
ITEM
c. Loans payable and due upon sale, transfer, or when refinancing
to receive cash out.
On December 2, 2008, the City Council approved amendments to the City's
Housing Rehabilitation Program by the adoption of Resolution No. 2008 183.
The amendments addressed the following:
1 Provided grant eligibility for homeowners who had previously received
a loan only
2. Provided loan eligibility for homeowners who had previously received a
grant only
3. Provided for a homeowner receiving a loan and grant, to re -apply to
the program subject to repayment of the prior loan and the elapsing of
a 10 -year period.
4 Implementation of an applicant appeal process
On May 6, 2009, the City Council approved an amendment to the City's Housing
Rehabilitation Program by the adoption of Resolution 2009 076. The amendment
provided for granting the City Manager with authority to grant or deny an appeal
to the program, inclusive of funding limits, provided the decision was compliant
with federal and state laws governing the use of HOME funds.
Discussion & Analysis:
The current Program Guidelines and Procedures incorporates both the policy
document (guidelines) and the operational aspects (procedures) of the City's
Housing Rehabilitation Program. Creating two separate documents, a Program
Guidelines document, and an Implementation Procedures document will assist in
facilitating the implementation of any required procedural changes to the
program.
Program Policy as established by the City Council will be contained within the
Program Guidelines, and will constitute the framework for the Implementation
Procedures. The Implementation Procedures will constitute the day -to -day
processing protocols for the program and address the extensive HOME program
requirements. By separating these two documents, modifications necessitated
by HUD /HOME program changes, or resulting from HOME program reviews, can
be amended expeditiously provided that they are consistent with the approved
Program Guidelines.
Program Modifications
The current program limits are established at maximums of $65,000 for loans,
and $10,000 for grants, or $75,000 in total program funding. The revised
program guidelines are proposing a reduced maximum loan amount of $35,000,
retention of the maximum $10,000 grant amount, and integration of the
emergency repairs component into the grant amount. Final maximum funding
under the proposed changes will be $45,000 The reduction in the maximum
2
loan amount is reflective of typical anticipated repair projects, and will allow for
additional clientele to be served.
The proposed guidelines also expands the program by incorporating the potential
use of Lynwood Redevelopment Agency Low- and Moderate - Income Housing
Set -aside funds (LMIHF) in conjunction with federal HOME funding. Although
LMIHF is not anticipated to be used the remainder of this fiscal year, the
provision of the LMIHF will enhance the program by providing available funding
in instances where the proposed rehabilitation activity will not comply with federal
HOME requirements. LMIHF will be reviewed and budgeted accordingly for the
next annual Budget Approval Process.
In addition, the City's Guidelines and Procedures contain deficiencies with
respect to a number of unaddressed or incorrect HOME requirements. The
following summary table provides a description of the current and proposed
changes.
Summary of Guidelines Changes
Requirement
Old Guidelines
New Guidelines
Authority to Administer
Not addressed
Listed as the Director of
Program
Redevelopment, or their
designee.
Program Funding Amounts
Loan: $65,000 maximum, 0%
Loan: $35,000 maximum, 0%
deferred
deferred
Grant: $10,000
Grant: $10,000
Total Loan and Grant: $75,000
Total Loan and Grant:
$45,000
Funding source
HOME funds
HOME funds and RDA LMIHF
Method of Calculating
All three allowable methods
The IRS 1040 method has
Household Income in
are listed, however no method
been designated for use
conformance with HOME
is designated for use under the
under the program.
requirements. One method
program.
must be selected from three
(3) available options and
designated for use in
assessing all program
applicants.
Clarification of soft costs
Not addressed
Clarifies that project soft costs
coverage (ex. title, credit
are to be absorbed by HOME
reports, recordation fees,
administration cost, and are
environmental testing, etc.)
not included within the loan or
rant amount.
Eligible Property definition
One -to -four unit residential
Limited to detached single
property, with owner residing
family residential.
in one of the units. This is not
an eligible definition under the
HOME program, since 51% of
the units repaired would
require occupancy by low
income households.
Loan /Grant Approval
Specified as a "Program Staff'
Creates a Project Review
Process
function.
Committee, which approves
all applicants for funding
based on a review of work
scope, and total projected
costs for the proj ect.
Loan Security Coverage
Not addressed
90% loan to value
Emergency Assistance
Provides for emergency
Integrated into the $10,000
assistance with unspecified
Grant Program, with special
funding levels, and an
allowances to be provided
eligibility documentation
within the Implementation
procedure which is
Procedures that will allow for
unacceptable under HOME
addressing the emergency
requirements.
prior to completion of any
other required repairs. Upon
completion of the emergency
repair(s), the applicant will
then revert back to their
original position at intake.
Conflict of Interest
Not addressed
Excludes from participation:
Provisions
City Council Members, all
Community Development
Department employees and
any employee, official or
agent of the City who
exercises any policy or
program decision- making
function in connection with
the Program.
Contractor Conditions-
Requires licensing in
Requires verification of
Licensing
compliance with state codes.
licensing with California State
Contractors License Board.
Contractor Conditions-
Requires verification with GSA
Requires verification with the
Debarment
and HUD. The debarred
Department of Labor website.
database is not maintained by
GSA and HUD, but rather the
Department of Labor.
Contractor Conditions-
Requires possession of an
Requires possession of
Insurance
unspecified amount of
$1,000,000 aggregate
manufacturers' and contractor
general liability, with City as
liability insurance.
an added insured.
Contractor — Bid Award
Not specified
Award to lowest responsive
bidder, in conformance with
HOME requirements.
Required Loan Documents
Referenced in various sections
Listed:
as to the deed of trust,
1 Promissory Note;
promissory note, and truth in
2. Deed of Trust;
lending disclosure statement.
3. Good Faith Estimate of
Settlement Charges;
4. Itemization of Amount
Financed;
5. Right of Rescission; and
6. Request for Notice under
Section 2924b of the Civil
Code (i.e. Notice to City if
senior loans foreclose or
upon sale).
El
Post - rehab. Value - Section
Not addressed
To be contained in
( 203)(b) compliance
Implementation Procedures
HOME Per unit subsidy
Not addressed
To be contained in
limits
Im lementation Procedures
The above listed changes will assist in: providing a program which will be HOME
compliant, expand client participation, and provide greater clarity to the
framework under which the program conducted.
Fiscal Impact:
There are no fiscal impacts to the City's General Fund, HOME funds or
Redevelopment Agency Low- and Moderate Income Housing Set -aside funds.
Coordinated With:
City Attorney's Office
City Manager's Office
Finance Department
Attachments.
Resolution
Draft Housing Rehabilitation Program Guidelines
RESOLUTION NO.
A JOINT RESOLUTION OF THE CITY COUNCIL AND LYNWOOD
REDEVELOPMENT AGENCY OF THE CITY OF LYNWOOD APPROVING
AMENDMENTS TO THE HOUSING REHABILITATION PROGRAM
GUIDELINES
WHEREAS, the City of Lynwood is a participating jurisdiction of the Home
Investment Partnerships Program (HOME Program) and receives an allocation of
federal funding to provide affordable housing for -low income households; and
WHEREAS, the Lynwood City Council has adopted a Housing
Rehabilitation Program to address the housing needs and enhance the overall
housing conditions and increase affordable housing opportunities to principally
benefit low income households; and
WHEREAS, the Redevelopment Agency Low -and Moderate Income
Housing Set -aside funds can be used in conjunction with HOME funds as an
added program source for the adopted Housing Rehabilitation Program; and
WHEREAS, the HOME funded housing programs are administered by the
City of Lynwood in compliance with the federal regulations established by the
Department of Housing and Urban Development (HUD); and
WHEREAS, the federal regulation provide opportunities for the City of
Lynwood to establish programs and develop program guidelines according to the
local housing needs.
NOW THEREFORE, THE CITY COUNCIL DOES HEREBY RESOLVE AS
FOLLOWS
Section 1. That the City of Lynwood's Housing Rehabilitation Guidelines
are hereby amended to read as follows:
A. Grants & Loans — Terms, Conditions and Restrictions
1 The maximum program loan amount is $35,000
2. The maximum program grant amount is $10,000
3. The maximum total funding under the program is $45,000
4 Eligible emergency repairs shall be addressed with available grant
funding to approved applicants.
5 Subject to Lynwood Redevelopment Agency approval, the use of
Low and Moderate Income Housing Set -aside funds is an added
source of program funds.
B. Program Administration
1 The authority to administer the Housing Rehabilitation Program shall
be vested with the Director of Redevelopment or their designee.
C Property Eligibility
1 Program assistance shall be limited to eligible detached single family
residential property located within the corporate city limits.
2. All funded programs loans and grants shall comply with the
maximum post - rehabilitation value and maximum per unit subsidy
limits as established by HUD
3. The combination of all secured indebtedness (including the Program
loan) may not exceed 90% of the assisted property's estimated post
rehabilitation value, as determined by appraisal.
D Loan and Grant Approval
1 All program loans and grants shall be approved by the Project
Review Committee (LRC), which consists of the Director of
Redevelopment and /or appointed designee.
E. Eligible Program Costs
1 All eligible program soft costs shall be charged to the City, and not to
the applicant's program grant or loan.
F Conflict of Interest
1 All City Council Members, all Community Development Department
employees and any employee, official or agent of the City who
exercises any policy or program decision - making function in
connection with the Program are ineligible for assistance under the
Program. This policy will be in effect until the individual's
disassociation with the City of Lynwood in such a capacity
G. Contractor Conditions
1 Prior to contract award, contractor eligibility shall be determined by
a. Checking the contractor's license status with the Contractors
State License Board (www.cslb ca.gov);
b Checking the contractor's Federal debarment status with the
Excluded Parties Listing System (www epls.gov);
2
c. Obtaining a copy of the contractor's current City of Lynwood
Business License; and
d. Obtaining additionally insured General Liability ($1 million general
aggregate coverage) and Workers Compensation (statutory
coverage) insurance certificates.
H. Loan Security and Documentation
The City shall not be committed to fund any loan- funded project prior
to the City's execution of a Participation Agreement and recordation
of the program Deed of Trust. Similarly, the City shall not be
committed to fund any grant- funded project prior to the City's
execution of the Participation Agreement.
2. In connection with any funded program loan, the City shall obtain the
following signed loan documents:
a. Promissory Note;
b Deed of Trust;
c. Good Faith Estimate of Settlement Charges;
d. Itemization of Amount Financed;
e. Right of Rescission; and
Request for Notice under Section 2924b of the Civil Code (i.e.
Notice to City if senior loans foreclose or upon sale)
Section 2. That the Director of Redevelopment or designee is authorized
to prepare Implementation Procedures which will effectuate the policies
established within the Program Guidelines, and control the implementation of the
Housing Rehabilitation Program.
Section 3. That the City Manager or designee is authorized to prepare
and execute such documents related to amendment of the guidelines.
Section 4. This resolution takes effect immediately upon its adoption.
PASSED, APPROVED, and ADOPTED this 15 day of February 2011
Aide Castro,
Mayor /Chair
ATTEST:
Maria Quinonez,
City Clerk/Secretary
APPROVED AS TO FORM:
Roger L. Haley,
City Manager /Executive Director
APPROVED AS TO CONTENT:
Fred Galante, Sarah Magana Withers,
City Attorney /Agency Counsel Director of Redevelopment
CITY OF LYNWOOD
HOUSING REHABILITATION PROGRAM
PROGRAM GUIDELINES
I. PROGRAM DESCRIPTION
The purpose of the City of Lynwood Housing Rehabilitation Program (HRP) is to assist low- and
moderate - income owners of single - family detached dwellings with the preservation of decent safe
and sanitary housing. The HRP corrects hazardous structural conditions, makes improvements
considered necessary to eliminate blight, promotes the construction of healthy, sustainable and
resource - efficient housing, improves disabled access, and corrects building, health and safety
code violations.
Program funds may be used to complete housing rehabilitation projects only, inclusive of project -
related soft costs such as hazardous materials testing fees, document recordation fees, escrow
fees and project - related hard costs such as construction contracts.
II. SOURCE OF FUNDS
HRP projects may be funded from the City's annual allocation of HOME Investment Partnerships
Act (HOME) funds. As necessary, the City may use the Lynwood Redevelopment Agency
(Agency) Low- and Moderate - Income Housing Set -aside Fund (LMIHF). The City of Lynwood
receives HOME funds from the U.S. Department of Housing and Urban Development (HUD)
because it is a HOME Participating Jurisdiction. LMIHF monies are used by the Agency for the
purposes of increasing, improving, and preserving the community's supply of low- and moderate -
income housing available at affordable housing cost. Funds for the HRP are approved by the
City Council each fiscal year as part of the City's Annual HUD Action Plan process and during the
annual budgeting of redevelopment funds.
III. PROGRAM LOANS
To fulfill the HRP's purpose, zero - interest (0 %) deferred loans will be made available to eligible
households whose incomes do not exceed the 80% of Area Median Income adjusted for
household size as promulgated by HUD Program loans may not be less than $5,000 and may
not exceed $35,000. When combined with the grant, an applicant will be eligible for up to
$45,000. Program funds may not be used for refinancing purposes. The rates and terms
applicable to Program loans are described further in Section V -F of these Program Guidelines.
There is a limit of one (1) Program loan per eligible owner Program loans shall be underwritten
by program staff and approved by the Project Review Committee (LRC), which consists of the
Director of Redevelopment and /or appointed designee.
For real property, program loans will be evidenced by a promissory note and secured by a deed
of trust. Program loans may not be in a junior position beyond a third trust deed. The
combination of all secured indebtedness (including the Program loan) may not exceed 90% of the
assisted property's estimated post rehabilitation value, as determined by appraisal.
All loan funding is limited and subject to the availability of program funds.
IV. PROGRAM GRANTS
Program Grants are available to assist eligible households meeting the 80% of AM[ criteria. The
maximum one -time grant amount is $10,000 and program applications for subsequent grants will
not be accepted.
Applicants may use up to $5,000 of the grant funds to address emergency repairs. The
remaining grant funds will be available to the applicant at such time that the applicant is
processed under the regular process. Emergencies are conditions that require housing
rehabilitation work necessary to remediate hazardous code - related issues. To be eligible for an
Housing Rehabilitation Program 1 Program Guidelines
January 2010
Residential Rehabilitation Program
emergency grant, the required repair must pose an immediate threat to the structural integrity of
the residence or the health and /or safety of the property's occupants.
All grant funding is limited and subject to the availability of program funds.
V ELIGIBILITY CRITERIA
A. Eligible Applicants
Eligible applicants are owners of single - family detached residential properties located
within the Lynwood corporate city limits. Eligible applicant properties must be owner -
occupied dwelling units.
Program loans may only be made to owner - occupants with acceptable credit history and
clear title to an eligible property in need of rehabilitation. As a prerequisite to eligibility,
an applicant must be willing to correct all current code violations.
City Council Members, all Community Development Department employees and any
employee, official or agent of the City who exercises any policy or program decision -
making function in connection with the Program are ineligible for assistance under the
Program. This policy will be in effect until the individual's disassociation with the City of
Lynwood in such a capacity
B. Eligible Household Income
Owner - occupant household income may not exceed 80% of the Los Angeles County
Area Median Income adjusted for household size as promulgated by the U.S. Department
of Housing and Urban Development. It is important to note that this figure is labeled
differently under the HOME and Agency programs. For HOME, this limit is considered
"Low - Income," whereas under LMIHF application it is considered "Lower Income."
For HOME derived funds, the determination of annual household income shall be made
in accordance with the HUD Technical Guide for Determining Income and Allowances for
the HOME Program, Third Edition. The City has elected to use the "IRS Form 1040
Adjusted Gross Income Method" as detailed in the Technical Guide.
Where HOME funds are being utilized, the determination of income eligibility shall be
made based on Title 24 Code of Federal Regulations —in conformance with the Technical
Guide for Determining Income Allowances for the HOME program (See Attachment A).
In accordance with U.S. Department of Housing and Urban Development (HUD)
regulations, an applicant's annual household gross income may not exceed 80% of the
area median income adjusted for household size, based on the income limits
promulgated annually by HUD (See Attachment B).
For LMIHF activities, income will be calculated in accordance with the requirements of
the requirements of Title 25 of the California Code of Regulations, Division 1, Chapter
6.5, Subchapter 2, Section 6914 (See Attachment C).
C. Eligible Improvements
Program loans and grants may be expended for structural repairs, roofs, insulation,
rodent and pest extermination, cabinets, counters, plumbing, electrical work,
windows /window frames, door /door frames, flooring, painting (interior and exterior),
heating and cooling, or access improvements for the disabled. Site work involving the
foundation, drainage improvements or any health and safety concerns or code violations
may also be eligible. Current code violations shall take precedence over all other repairs,
Housing Rehabilitation Program 2 Program Guidelines
January 2010
Residential Rehabilitation Program
including general property improvements. Construction of room additions or the initial
construction or repair of luxury items (i.e., bar -b -ques, saunas, hot tubs, patio covers,
etc.) is not eligible.
Construction materials used for this Program shall conform to the specifications designed
by Staff under its Rehabilitation Standards. The Participant shall not be allowed to
upgrade approved work scope items beyond designated standard grade materials.
D Eligible Costs
Program loan and grant proceeds will be used to cover the rehabilitation costs. All other
costs such as Program fees, such as, but not limited to the title report, credit report costs,
document recordation costs, escrow costs, hazardous materials testing costs, and other
project - related soft costs that are necessary to implement the project shall be borne by
the City
E. Relocation
Relocation is not contemplated as a part of this rehabilitation activity, however if an
unanticipated event occurs which requires temporary relocation, such relocation shall be
performed in compliance with the provisions of the Uniform Relocation Assistance and
Real Property Acquisitions Policies Act of 1970 and Section 104(d) and may be paid for
using program funds.
F Rates and Terms
Deferred loans will not accrue interest and do not require monthly payments. They are
immediately payable inclusive of the unpaid principal balance, and any other amounts
due under this Note upon the earlier of.
1 The sale, conveyance, transfer, lease, rental, hypothecation of the Security, or any
part thereof, or any interest therein, or divestment of title or any interest therein in any
manner or way, whether voluntarily or involuntarily, without the prior written consent
of the City being first had and obtained; or
2. Failure to adhere to the provisions of the Participation Agreement; or
3. Failure to perform any obligation under the Deed of Trust securing this Note, or any
other Deed of Trust encumbering the Security
Participant may pre -pay the City Loan at any time without penalty All payments received
on account of the Note shall be first applied to accrued interest, if any, and the remainder
shall be applied to the reduction of the principal balance.
The City Loan is not assumable except under the limited circumstances listed below
The following allowable assumptions shall not be construed as a transfer under the
provisions of this Policy
1 The transfer of the Property to the surviving joint tenant by devise, descent or
operation of the law, on the death of a joint tenant;
2. A transfer of the Property where the spouse becomes an owner of the property;
3. A transfer of the Property resulting from a decree of dissolution of marriage, legal
separation or from an incidental property settlement agreement by which the spouse
becomes an owner of the Property;
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Residential Rehabilitation Program
4. A transfer to an intervivos trust in which the Borrower is and remains the beneficiary
and occupant of the property
VI. IMPLEMENTATION
A. Administration
The Lynwood Redevelopment Department Staff or their designees ( "Staff') shall
administer the Program. As used herein, the term "Staff' may include either employees
or consultants of the Department under the direction of the Director of Redevelopment.
The administration of the Program including, without limitation, application evaluation
procedures, rehabilitation assessments, cost estimation, bid solicitation, contractor
selection, construction management, inspection, disbursement of Program funds and
processing of the Notice of Completion will be managed in accordance with this Policy
The Director of Redevelopment shall be responsible to ensure that HRP Implementation
Guidelines are maintained and updated periodically to ensure compliance with all U.S.
Department of Housing and Urban Development policies and regulations. The
Implementation Guidelines shall conform to this approved Policy
B. Application
Applications for participation in the Program may be obtained from and returned to the
City of Lynwood Redevelopment Department. Applications will be accepted on a first -
come first- served basis from eligible applicants consistent with funding availability The
application must be completed in its entirety and submitted together with the following
documentation:
1 Application Form;
2. Copy of applicant(s) valid government- issued photo identification;
3. Verification of all Household Income, which must include, but is not limited to the
Applicant's most recent signed Federal Income Tax Return, three (3) most recent pay
stubs, three (3) most recent bank statements, and statements or other acceptable
documentation of all other income sources and asset accounts;
4. Proof of ownership of the eligible property such as a copy of the Deed of Trust, or
Grant Deed;
5. Proof of occupancy at the residence by providing a copy of a utility bill (however not a
water or trash bill);
6. A prioritized and itemized list of the construction work requested to be done;
7 Acknowledgement form for Receipt of lead based paint brochure;
8. Copy of the latest property tax bill; and
9. Copy of the homeowner's insurance policy
Only when the program application is complete, Staff has confirmed income eligibility and
the owner- occupant status, shall the Applicant be placed on a list of eligible projects in
order Therefore, those applicants who submit all requested documents with the
Application in the shortest time frame will have the highest priority for assistance under
the Program. For the purpose of determining actual funding, completion of all program
requirements must be achieved, inclusive of the timely procurement of bids, and
execution of all related program documentation.
Housing Rehabilitation Program 4 Program Guidelines
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Residential Rehabilitation Program
Application approval is subject to funding availability Staffs eligibility determination is
not a commitment of funds. Funds shall only be committed upon the approval by the
LRC, full execution of the Participation Agreement, signing of the promissory note, and
the recordation of the Deed of Trust.
D Pre - qualification. Evaluation and LRC Review
Pre - qualification and Property Evaluation — Each application filed will be dated and
processed in the order received. Staff will review applications for completeness and
verify property eligibility Incomplete applications will be returned to the applicant.
Staff shall notify all ineligible applicants of their status by written correspondence.
Prior to consideration by the LRC, Staff shall schedule an appointment with each pre -
qualified applicant at the subject property to review the work requested and to inspect
the premises. Based on this on -site review, Staff shall prepare a Current Conditions
Assessment Report that will establish the type and level of rehabilitation required.
Subsequent to the inspection, a complete work description shall be prepared with an
internal cost estimate. For HOME - funded projects, an estimated post- construction
valuation must be obtained through a process acceptable to HUD such as appraisal.
2. Maximum Post — Rehabilitation Value: As a condition of HOME funding, the
maximum estimated post - rehabilitation value of the property may not exceed 95% of
the median sales price as determined in accordance with 24 CFR 92.254(a)(2)(iii).
Program staff shall utilize the HUD - sanctioned methodology to determine the
maximum value that yields the highest maximum post - rehabilitation value at the
beginning of each program year
3. Maximum Per -Unit Subsidy Limits As a condition of HOME funding, the maximum
per -unit subsidy to affordable housing may not exceed the limits determined and
promulgated by HUD in accordance with 24 CFR 92.250. The maximum program
loan and grant limits has been designed to minimize per -unit subsidy considerations.
4. LRC Review — The LRC shall consist of the Director of Redevelopment and the
Deputy Director of Redevelopment. The LRC will consider complete application
packages for approval based on the Program underwriter's recommendations. In
order to proceed, all LRC members must approve all Program loans.
5. Owner Approval and Work Scope Changes — The owner shall review and provide an
approval signature on the Work Description and Bid Proposal Form prior to the
preparation of bid packages by the City
D. Bidding and Contractor Selection Procedures
The applicant shall solicit bids (in accordance with Implementation Guidelines) from
contractors for completion of the rehabilitation work. Owners shall solicit bids from
general B- Licensed contractors for Work Descriptions involving more than one specialty
Bid solicitations can be made of licensed specialty contractors if the Work Description
involves a single specialty (i.e. roofing, electrical, plumbing, etc.). Once the owner has
received three (3) or more bids from qualified contractors, the owner shall submit three
(3) or more bids to the City for review The bid evaluation shall result in the contract
award to the lowest responsible, responsive bidder Prior to contract award, Staff will
confirm contractor eligibility by
1 Checking the contractor's license status with the Contractors State License Board
( www.cslb.ca.gov) ;
Housing Rehabilitation Program 5 Program Guidelines
January 2010
Residential Rehabilitation Program
2. Checking the contractor's Federal debarment status with the Excluded Parties Listing
System (MMW.*2I M);
3. Obtaining a copy of the contractor's current City of Lynwood Business License; and
4 Obtaining additionally insured General Liability ($1 million general aggregate
coverage) and Workers Compensation (statutory coverage) insurance certificates.
E. Loan Documents
When bid proposals are complete, loan approval has been obtained from the LRC and
the bid is ready to be awarded to the lowest responsive and responsible bidder, Staff
shall present the applicant with a Participation Agreement and loan documents, which
includes the:
1 Promissory Note;
2. Deed of Trust;
3. Good Faith Estimate of Settlement Charges;
4. Itemization of Amount Financed;
5. Right of Rescission; and
6. Request for Notice under Section 2924b of the Civil Code (i.e. Notice to City if senior
loans foreclose or upon sale).
The City shall not be committed to fund any loan- funded project prior to the City's
execution of the Participation Agreement and recordation of the program Deed of Trust.
Similarly, the City shall not be committed to fund any grant- funded project prior to the
City's execution of the Participation Agreement only Staff shall provide fully executed
duplicates of the originals of the Agreement and any loan documents to the Applicant.
Pre - Construction Meeting. Contractor Agreement. Notice to Proceed and Construction
Phase
Following the recordation of loan documents, Staff will convene a pre- construction
meeting with the owner and selected contractor to review the Contractor Agreement,
Work Description and Bid Proposal Form, and to answer site - specific questions. Three
(3) calendar days following the execution of the Contractor Agreement, Staff will issue the
Notice to Proceed. Subsequent to obtaining the required permits, the contractor will carry
out the required work. Generally, work shall commence no later than ten (10) days from
the date of the Proceed Notice and work must be completed no more than 30 -60 days
after the start date (or as agreed upon by the owner and contractor). Property owners
and Staff shall authorize the release of program funds in accordance with the
Participation Agreement between the property owner(s) and the City, as well as the
Contract Agreement between the property owner(s) and the construction contractor as
further detailed in the Implementation Guidelines.
G. Proiect Closeout
Individual rehabilitation projects will be financially closed subsequent to Staff approval of
the work performed and the property owner's execution of a Notice of Completion. To
prevent persons or businesses associated with the project from filing a lien against the
property after the City has released all project funds, the City shall withhold ten percent
(10 %) of the construction contract from the prime contractor until such liens may no
longer be filed, which, in accordance with California Civil Code Section 3116 is 30
Housing Rehabilitation Program 6 Program Guidelines
January 2010
Residential Rehabilitation Program
calendar days following the recordation of the Notice of Completion with the County
Recorder's Office. To allow for the receipt of mailed notification of any recorded liens, the
City shall withhold the ten percent (10 %) retention until 35 calendar days following the
recordation of the Notice of Completion.
H. Approval of Program Legal Documents
All Program legal documents shall be approved as to form by the City's legal counsel
prior to their use.
Authority to Administer
The preparation and use of all required Program Implementation Guidelines, manuals,
forms, documents and agreements shall be administered by the Director of
Redevelopment, or his /her designee, in accordance with this Policy The Director of
Redevelopment has the authority to waive eligibility requirements and loan limits at
his /her discretion to address critical home improvement needs, provided that the
requirement is not statutory The Director of Redevelopment may also approve the
subordination of the City's Program loan lien in the event that a borrower refinances a
prior- recorded loan to improve their mortgage terms.
J. Program Guidelines Changes And Modifications
Minor changes to these Program Guidelines involving administrative procedures or
accommodations to adapt to regulatory changes may be performed with the approval of
the Director of Redevelopment. All other changes require the approval of the Lynwood
City Council.
Housing Rehabilitation Program 7 Program Guidelines
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