2014-28798 Reso RESOLUTION NO. 2014-28798
A RESOLUTION OF THE MAYOR AND THE CITY COMMISSION OF THE
CITY OF MIAMI BEACH, FLORIDA, APPROVING AND AUTHORIZING AN
AMENDMENT TO THE FY 2014/2015 ACTION PLAN; SAID AMENDMENT
AUTHORIZING THE REALLOCATION OF $122,492.44 OF FY 2014/2015
HOME INVESTMENT PARTNERSHIPS PROGRAM (HOME) FUNDS FROM
THE LONDON HOUSE PROJECT TO THE CARRFOUR HARDING VILLAGE
PROJECT; PROVIDING FOR A THIRTY (30) DAY PUBLIC COMMENT
PERIOD; AND SCHEDULING A PUBLIC MEETING ON THE PROPOSED
AMENDMENT TO THE CITY'S FY 2014/2015 ACTION PLAN; AND
FURTHER AUTHORIZING THE CITY MANAGER TO EXECUTE ANY
DOCUMENTS NECESSARY TO EFFECTUATE THE REALLOCATION OF
SAID HOME FUNDS TO THE CARRFOUR HARDING VILLAGE PROJECT.
WHEREAS, the City is an entitlement recipient of HUD formula grant funds from the
HOME Investment Partnerships Program (HOME); and
WHEREAS, HOME funds are used for affordable housing activities, including multi-
family rentals and first-time homeownership; and
WHEREAS, the City expects to continue to receive entitlement funds from this grant
program to operate the City's affordable development activities; and
WHEREAS, the Action Plan for Federal funds is a requirement under HUD's formula
grant programs, which include the HOME Program; and
WHEREAS, HOME stipulates that funds be expended within timeliness guidelines as
delineated in 24 CFR Part 92, among others; and
WHEREAS, the City reallocated recaptured funds to Carrfour Supportive Housing's
(Carrfour) Harding Village Apartments project in an effort to prevent the loss of funds to de-
obligation by HUD; and
WHEREAS, the several challenges arose between the City and Carrfour that narrowed
the window for draw on the expiring funds to September 26, 2014, the very last day that expiring
funds could be drawn from HUD; and
WHEREAS, the expenditure deadline was not met because the City was only able to
complete the draw in its Eden financial system and not HUD's financial system; and
WHEREAS, HUD subsequently recaptured $185,272 of HOME funds on September 27,
2014; and
WHEREAS, the Carrfour Harding Village Project was impacted by this recapture of
funds, to the extent of$122,492.44 (Funding Shortage), and the City, in good faith, would like to
provide the Funding Shortage through other available funds; and
WHEREAS, FY 2014/2015 HOME funds, in the amount of $122,492.44, were allocated
to the London House Project, but will not be required to complete the project because the bids
returned lower than anticipated; and
WHEREAS, the Administration recommends the reallocation of the London House
Project funds to the Carrfour Harding Village Project in order to cover the Funding Shortage;
and
WHEREAS, the resulting HOME funds reallocation recommendation will be incorporated
into the City's FY 2014/2015 Action Plan; and
WHEREAS, the City will provide for a thirty (30) day public comment period and a public
meeting on the proposed Substantial Amendment to the FY 2014/2015 Action Plan; and
WHEREAS, the City Manager is the designated agent for all HUD formula grants, and
executes the grant applications, grant agreements, and other applicable HUD documents on
behalf of the City.
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY COMMISSION OF
THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City Commission hereby approve
and authorize an amendment to the FY 2014/2015 Action Plan (Amendment); said Amendment
authorizing the reallocation of $122,492.44 of FY 2014/2015 HOME Investment Partnerships
Program (HOME) funds from the London House Project to the Carrfour Harding Village Project;
providing for a thirty (30) day public comment period; and scheduling a public meeting on the
proposed Amendment to the City's FY 2014/2015 Action Plan; and further authorize the City
Manager to execute any documents necessary to effectuate the reallocation of said Home funds
to the Carrfour Harding Village Project.
PASSED AND ADOPTED this day of OC4er— , 20'14.
ATTEST: '
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APPROVED AS TO
FORM & LANGUAGE
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City Attorney mate
COMMISSION ITEM SUMMARY
Condensed Title:
A Resolution Authorizing the City Manager to reallocate $122,492.44 of FY 2014/2015 HOME Investment
Partnerships Program(HOME)funds; amend the FY 2014/2015 Action Plan accordingly; issue a notice of a thirty
(30)day public comment period and scheduling a public meeting on the proposed Substantial Amendment to the
City's FY 2014/2015 Action Plan; and reallocate the aforesaid amount of home funds to the Carrfour Harding
Village project.
Key Intended Outcome Supported:
N/A
Supporting Data(Surveys, Environmental Scan, etc.):
N/A
Item Summa /Recommendation:
An Administration review found that, due to the lack of appropriate expenditure of HOME funds, the City was
faced with the possibility of the de-obligation/recapture of$185,272 of HOME funds.Staff evaluated its options
and determined that a project being undertaken by Carrfour Supportive Housing, Inc. (Carrfour), the Harding
Village Apartments,offered the best opportunity to mitigate this possible loss.
Staff worked diligently with Carrfour and others to expedite the policy steps required to accomplish this. However,
time constraints were so limited that it became evident that the City Commission approved a one-time advance
drawdown for this Candour project as memorialized in Resolution No.2014-28750.The advance drawdown could
not be processed until the last day allowed by HUD (September 26)because Carrfour needed prior approval for
any loans to this project from the City of Miami that was not disclosed to the City until August 27th.This approval
could not be obtained until the City of Miami's Loan Committee convened on the morning of September 26th.
On September 26th, all actions for that day were being carried out by Housing & Community Services staff as
planned including the draw of funds in the City's Eden fiscal system. Unfortunately, due to a miscommunication
between Housing & Community Services and the Finance Department, the drawdown action was not fully
completed until Monday,September 29th. HUD recaptured the funds at 12:01 am on September 27th.
Since the City is contractually obligated to provide the funding to Carrfour to complete the project, it was
necessary to identify an alternative source of funding to replace the $185,272. Therefore, staff reviewed its
existing HOME Program funds to determine the amount of uncommitted funds available for allocation to this
project.This resulted in the identification of$62,779.56 of currently available funds leaving a remaining shortfall of
$122,492.44. In addition, since cost projections for the rehabilitation of the London House Apartments project
came in slightly lower than budgeted,a reallocation of these excess funds can provide coverage of the remaining
shortfall.
Administration Recommendation -Adopt the Resolution.
Advisory Board Recommendation:
N/A
Financial Information:
Source of Amount Account
Funds: 1 $122,492.44 Account Number: 182-5231-000349
2 $62,779.56 Account Number: 181-5230-000349
3
OBPI Total $185,272.00
Financial Impact Summary:
City Clerk's Office Legislative Tracking:
Maria Ruiz/ Housing &Community Services
Sign-Offs:
Department Director Assistant City Manager City Manager
MLR KGB JLM
AGENDA ITEM R11
MIAMIBEACH 10-1,2-W DATE
MIAMI BEACH
City of Miami Beath, 1700 Convention Center Drive,Miami Beach, Florida 33139,www.miamibeachfl.gov
COMMISSION MEMORANDUM
TO: Mayor Philip Levine and Member f the Ci Commission
FROM: Jimmy L. Morales, City Manager
DATE: October 22, 2014
SUBJECT: A RESOLUTION OF THE MAYO AND THE CITY COMMISSION OF THE
CITY OF MIAMI BEACH, FLORID , APPROVING AND AUTHORIZING THE
CITY MANAGER TO REALLOCATE $122,492.44 OF FY 2014/2015 HOME
INVESTMENT PARTNERSHIPS PROGRAM (HOME) FUNDS; AMEND THE
FY 2014/2015 ACTION PLAN; ISSUE A NOTICE OF A THIRTY (30) DAY
PUBLIC COMMENT PERIOD AND SCHEDULING A PUBLIC MEETING ON
THE PROPOSED SUBSTANTIAL AMENDMENTS TO THE CITY'S FY
2014/2015 ACTION PLAN; AND REALLOCATE THE AFORESAID AMOUNT
OF HOME FUNDS TO THE CARRFOUR HARDING VILLAGE PROJECT.
ADMINISTRATION RECOMMENDATION
Adopt the Resolution.
BACKGROUND
The City is an entitlement community designated by the U.S. Department of Housing and Urban
Development (HUD) and as determined by the decennial census information on population
growth lag, age of housing stock, and poverty. As an entitlement community, the City qualifies
for an annual allocation under HUD's grant programs. The HOME Investments Partnership
Program (HOME)was established in 1992 to provide funding specifically for affordable housing.
HUD allocates these housing funds to strengthen public/private partnerships and expand the
supply of affordable housing that is decent, safe and sanitary.
The HOME Program has timeliness requirements regarding the expenditure of funds. HOME
funds must be committed to a project within two years of City's receipt, and expended within five
years. HUD further requires its entitlement jurisdictions to ensure that funded activities are
carried out in the defined project scope and within the timeframe allowed. The City's Action
Plan, an annual document which defines how the City will utilize its HUD funds, is monitored
throughout the year to ensure compliance with federal regulations and progress towards the
National Objective, which stipulates that HOME-funded activities must create housing units that
benefit low- and moderate-income persons who earn at or below 80% of the Area Median
Income (AMI).
From time-to-time, it is necessary for the City to process a "Substantial Amendment" to the Five-
Year Consolidated Plan or the One Year Action Plans to allow for the funding of new activities,
modification of existing activities, or other program administrative actions. The City is required
by HUD [24 CFR 91.505 (b)] to identify the criteria to be used in determining if a proposed
action will be considered a "substantial amendment", as follows:
Commission Memorandum —Carrfour Funding Reallocation
October 22, 2014
Page 2 of 3
• Addition of a new activity or project not previously described in the Consolidated or
Action Plan;
• Deletion of an activity or project previously described in the Consolidated or Action Plan;
• Change in the purpose, scope, location or beneficiaries of an activity or project
previously described in the Consolidated or Action Plan;
• Change in the use of funds from one eligible activity or project to another previously
described in Consolidated or Action Plan; and/or
• A cumulative change in the use of funds from an eligible activity to another eligible
activity that decreases an activity's funding by 10% or more or increases an activity's
funding by 10% or more during the fiscal year.
Any proposed amendment that is considered a substantial amendment is subject to the Citizen
Participation process; requires formal action by the City Commission; and requires approval by
HUD. Furthermore, a thirty (30) day public notice is required to provide the opportunity for the
public to review and comment on the proposed substantial amendments to the City's FY 2008
through 2013 Action Plans. The City will also include a notice of a public meeting on the
proposed substantial amendments. The City will consider all comments or views received from
the public concerning proposed substantial amendments in accordance with 24 CFR 91.105 (c)
(3). A summary of these comments and views shall be attached to the substantial amendment
submitted to HUD.
ANALYSIS
I operations, funding
When the current Administration assumed duty, it conducted a review of al ope a g
agreements and fiscal operations of its HUD-funded activities. The review found that, due to the
lack of appropriate management and monitoring of the timely allocation, commitment, and
expenditure of HOME funds, the City was faced with the possibility of the de-
obligation/recapture of $185,272 of HOME funds based on its September 30, 2014 expenditure
deadline. This condition is also related to the City's history of allocating all of its HOME funds to
Miami Beach Community Development Corporation (MBCDC). Due to that organization's
inability to successfully complete some of the proposed projects, and the City's need to cancel
projects and recapture the funds, the City needed to adjust its funding/spending to meet the
required expenditure deadline.
Staff evaluated its options and determined a course of action to mitigate the pending loss of
funds. A project being undertaken by Carrfour Supportive Housing, Inc. (Carrfour) that had
already been targeted for City support was identified as a project that could be modified, and its
timeline accelerated, to allow for the timely expenditure of funds. This Carrfour property is
known as Harding Village Apartments and is located at 8520 Harding Avenue.
Staff worked diligently with Carrfour, the State Historic Preservation Office (SHPO), and HUD to
expedite the policy steps that were required to bring this action to fruition. However, the time
constraints were so limited that it became evident that the City would need to provide an
advance draw to Carrfour so that the expenditure deadline could be satisfied. Therefore, at its
September 10, 2014 Commission Meeting, the City Commission approved a one-time advance
drawdown for this Carrfour project as memorialized in Resolution No. 2014-28750. The advance
drawdown could not be processed until the last day allowed by HUD (September 26) because
Carrfour needed prior approval for any loans to this project from the City of Miami (an initial
project investor) that was not disclosed to the City until August 27th. This prior approval could
Commission Memorandum—Carrfour Funding Reallocation
October 22, 2014
Page 3of3
not be obtained until the City of Miami's Loan Committee convened on the morning of
September 26tH
On September 26th, all actions for that day were being carried out by Housing & Community
Services staff as planned including the draw of funds in the City's Eden fiscal system. It was
anticipated that the drawdown in the HUD system would be completed. Unfortunately, due to a
miscommunication between Housing & Community Services and the Finance Department, the
drawdown action was not fully completed until Monday, September 29th. HUD recaptured the
funds at 12:01 am on September 27th
Subsequent to an internal review of this failure, the Housing & Community Services employee
that handled this transaction was dismissed for her role in the failure. In addition, future HUD
draws subject to deadlines will be communicated to the Finance Department by the Office of
Housing and Community Services in writing to ensure effective communication and efficacy
between the departments. In addition, additional language will be added to the City's funding
agreements with sub-recipients to ensure that last minute disclosures of prior review and/or
consent requirements will be prohibited if not disclosed at the time of award. The late notice by
Carrfour of its need for prior approval by the City of Miami prevented the City from drawing
funds until after the approval was issued by the City of Miami on the morning of September 26tH,
the last day in which draws could be made to ensure compliance with HUD's expiring funds
deadline.
Since the City is contractually obligated to provide the funding to Carrfour to complete the
project, it was necessary to identify an alternative source of funding to replace the $185,272.
Therefore, staff reviewed its existing HOME Program funds to determine the amount of
uncommitted funds available for allocation to this project. This resulted in the identification of
$62,779.56 of currently available funds leaving a remaining shortfall of$122,492.44. In addition,
since cost projections for the rehabilitation of the London House Apartments project came in
slightly lower than budgeted, a reallocation of these excess funds can provide coverage of the
remaining shortfall.
Because HUD has re-captured the expiring HOME funds, there is no longer a need for advance
funds drawdowns as previously thought. Therefore, Carrfour can now utilize normal
reimbursement processes to draw project funds from the City.
CONCLUSION
The Administration recommends that the Mayor and City Commission approve and authorize
the City Manager to reallocate $122,492.44 of FY 2014/2015 HOME Investment Partnerships
Program (HOME) funds; amend the FY 2014/2015 Action Plan accordingly; issue a notice of a
thirty (30) day public comment period and scheduling a public meeting on the proposed
Substantial Amendment to the City's FY 2014/2015 Action Plan; and reallocate the aforesaid
amount of home funds to the Carrfour Harding Village project.
JLM/K /MLR/ARB
F:\T—Drive\AGENDA\2014\October\Housing&Community Services\Carrfour Harding Village CC MEMO.docx 10-22-2014