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2009-27039 ResoRESOLUTION NUMBER 2009-27039 A RESOLUTION OF THE MAYOR AND THE CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, APPROVING THE CITY'S PLANNED USE OF AND RELATED APPLICATION FOR NEIGHBORHOOD STABILIZATION PROGRAM (NSP) FUNDS, IN THE AMOUNT OF $2,545,511, TO PURCHASE AND REHABILITATE, AS NECESSARY, ONE OR MORE FORECLOSED OR ABANDONED MULTI-FAMILY BUILDINGS IN THE CITY OF MIAMI BEACH AS DETERMINED BY THE CITY'S GREATEST NEED, TO BE MADE AVAILABLE AS RENTAL PROPERTIES FOR INCOME QUALIFIED HOUSEHOLDS IN ACCORDANCE WITH NSP RULES, AS PROMULGATED BY THE FLORIDA DEPARTMENT OF COMMUNITY AND THE UNITED STATES DEPARTMENT HOUSING AND URBAN DEVELOPMENT. WHEREAS, on July 31, 2008, the United States Congress enacted the Housing and Economic Recovery Act of 2008, thereby creating the Neighborhood Stabilization Program, which directed the Department of Housing and Urban Development (HUD) to allocate $3.93 billion to states and units of local government as emergency assistance for the purchase and redevelopment of abandoned and foreclosed homes; and, WHEREAS, the State of Florida received an NSP allocation of $91,141,478 to provide funding to those units of local government, including the City of Miami Beach, which under HUD's allocation formula would receive under $2 million in NSP funds; and, WHEREAS, the State of Florida, acting through its Department of Community Affairs (DCA), has determined the City of Miami Beach's allocation to be $1,641,832 as the regular NSP allocation and an additional $907,719 as a supplemental allocation to be dedicated for rental housing to meet the low-income requirements of the NSP; and, WHEREAS, the DCA requires that the supplemental allocation be used exclusively for the purchase of foreclosed properties to be held and rented to households earning nor more than 50% of the area median income; and, WHEREAS, the regular allocation of NSP funds may be used for the purchase and needed rehabilitation of foreclosed properties for rental or resale to income qualified households earning no more than 120% of the area median income; and, WHEREAS, the DCA has placed on its NSP sub-recipients a timeframe of ten (10) months to obligate their allocations or risk forfeiting them; and, WHEREAS, the City is allowed to retain 6.6% of its total allocation for its administration costs, leaving a net of $847,809 and $1,533,471 for the regular and rental allocations, respectively; and, WHEREAS, the Administration is recommending that both the regular and the low- income allocations be used for the purchase and rehabilitation, as needed, of one or more multi-family buildings to be kept as rental properties to benefit income qualified households in accordance with the NSP program; and, WHERAS, in the event there are funds remaining after the purchase of one or more multi-family buildings, or the City receives additional NSP funding, the Administration recommends the purchase of condominium units for resale to income qualified homebuyers, only after due diligence is undertaken into the physical and financial health of the condominium, and such due diligence indicates likely stability; and, WHEREAS, a formal application showing the planned use of the funding is due to DCA by April 6, 2009; and, WHEREAS, to meet the DCA's application deadline, the Administration now requests that the Mayor and City Commission approve the planned use of NSP funds as outlined above; and NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City Commission hereby approve the City's planned use of and related application for Neighborhood Stabilization Program (NSP) funds, in the amount of $2,545,511, to purchase and rehabilitate, as necessary, one or more foreclosed and abandoned multi-family buildings in the City of Miami Beach as determined by the City's greatest need, to be made available as rental properties for income qualified households, in accordance with NSP rules, as promulgated by the Florida Department of Community Affairs and the United States Department of Housing and Urban Development. Passed and adopted this 18th day of March , 2009. MA OR Matti Herrera Bower ATTEST: ~~ ~~ CITY CLERK Robert Parcher APPROVED AS TO FORM & LANGUAGE & F EXECUTION T:WGENDA\2009Uvlarch 18\Regular\NSP Application (RESO).doc 3 ~ 2 OR ttome a COMMISSION ITEM SUMMARY ~`nnrroncorl Ti41a• A resolution approving the City's planned use of Neighborhood Stabilization Funds to purchase and rehabilitate, as necessary, foreclosed or abandoned multi-unit buildings to be made available as rental properties for income-qualified households or as an alternative, foreclosed or abandoned land for land-banking purposes, as per NSP rules. Key Intended Outcome Supported: Increase access to workforce or affordable housing. - Supporting Data (Surveys, Environmental Scan, etc.): Based on the 2007 Customer Satisfaction Survey, affordable housing was a concern for 82% of those surveyed. Issue: Shall the City use NSP funds for the purchase of one or more multi-unit buildings and make them available as rental properties for income qualified households, or alternatively, for the purchase of foreclosed or abandoned land for land- banking purposes, in accordance with the Neighborhood Stabilization Program requirements? Item Summary~Kecommenaation: The City of Miami Beach was awarded a total of $2,545,511 from HUD's Neighborhood Stabilization Program (NSP), the primary purpose of which is to use to purchase foreclosed and abandoned properties. The State's Department of Community Affairs (DCA), the pass-through entity handling Miami Beach's NSP allocation, requires a formal application due to DCA by April 6, 2009, along with a plan for the use of the funding. The City Commission must make a policy decision at its March 18, 2009, meeting to comply with this deadline. From the City's total allocation of $2,545,511, $907,719 is the supplemental allocation which is required to be used to purchase units to create rental housing for households earning no more than 50% of the area median income (AMI). Use of the regular NSP funds ($1.6 million) must benefit those households whose incomes do not exceed 120% AMI and can result in rental or homeownership opportunities. Regular NSP funds may also be used for homebuyer assistance and to create land banks to assemble, temporarily manage, and dispose of vacant land for the purpose of stabilizing neighborhoods and encouraging re-use or redevelopment of property. The Administration recommends using the City's regular NSP allocation to purchase one or more multi-unit buildings, for the units to be made available as rental units. Due to the volatility of the real estate market, and because the prospective income-qualifying homebuyers would generally not qualify for single family residences in Miami Beach, any homebuyer opportunities would be geared toward purchases of units in condominium buildings. However, the Administration recommends minimizing homebuyer assistance with regular NSP funds to limit potential exposure that the targeted income- qualified purchasers would face due to unanticipated condo assessments, and maintenance fees. Furthermore, focusing the use of the regular NSP allocation for one or two large purchases best streamlines the obligation of those funds within the 10-month obligation deadline set by the DCA, to prevent the possibility of recapture of funds allocated to the City. At the Neighborhoods/Community Affairs Committee meeting of March 11, 2009, the Committee expressed their interest in preference being given for those rental units to serve moderate income [workforce] families. Additionally, the Committee recommended that the Commission also consider, after the competitive process is concluded, whether the regular NSP funding should alternatively be used for the purchase of foreclosed or abandoned land for land-banking purposes 9capped at 10% of total allocation). In order to meet the required application deadline, approval of the proposed strategy is required. Advisory Board Recommendation: On March 11, 2009 the Neighborhood /Community Affairs Committee recommended that the City use the NSP funds as outlined above. . Financial Information: Source of Funds: Amount Account Approved 1 2 NSP OBPI Total Financial Im act Summa City Clerk's Office Legislative Tracking: ~ Anna Parekh ~ Department Director ~ Assista~t/G~y~Manager ~ _ pity Manager ~ T:WGENDA\2009WIarch 18\Regular\NSP Application m MIAMIBEACH AGENDA ITEM ~, DATE 3,(8 09 t `~. t ~ a + ~_a, y ~+ , ~, ! s ''r , ~ .~ City of Miami Beath, 1700 Convention Center Drive, Miami Beach, Florida 33139, w~ww.miamibeachfl.gov COMMISSION MEMORANDUM TO: Mayor Matti Herrera Bower and Members of the 'ty Commission FROM: Jorge M. Gonzalez, City Manager DATE: March 18, 2009 SUBJECT A RESOLUTION OF THE MAYOR AND THE CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, APPROVING THE CITY'S PLANNED USE OF AND RELATED APPLICATION FOR NEIGHBORHOOD STABILIZATION PROGRAM (NSP) FUNDS, IN THE AMOUNT OF $2,545,511, TO PURCHASE AND REHABILITATE, AS NECESSARY, ONE OR MORE FORECLOSED OR ABANDONED MULTI-FAMILY BUILDINGS IN THE CITY OF MIAMI BEACH AS DETERMINED BY THE CITY'S GREATEST NEED, TO BE MADE AVAILABLE AS RENTAL PROPERTIES FOR INCOME QUALIFIED HOUSEHOLDS IN ACCORDANCE WITH NSP RULES, AS PROMULGATED BY THE FLORIDA DEPARTMENT OF COMMUNITY AND THE UNITED STATES DEPARTMENT HOUSING AND URBAN DEVELOPMENT. ADMINISTRATION RECOMMENDATION Adopt the Resolution. ANALYSIS The City of Miami Beach was awarded a total of $2,545,511 from HUD's Neighborhood Stabilization Program (NSP). The State's Department of Community Affairs (DCA) is the pass-through entity handling Miami Beach's NSP allocation. While the City was allocated a sum on a formula basis, a formal application for the use of the funds is due to DCA by April 6, 2009, along with a plan for the use of the funding, which will be the City's Housing Assistance Plan (HAP). To meet the DCA's application deadline, the City Commission must make a policy decision at its March 18, 2009, meeting. Therefore, a recommended use for the NSP funds is outlined below. On February 6, 2009, we issued a second Letter to Commission delineating the parameters of the NSP, and the funding that we have been allocated. As mentioned in the LTC, from the City's allocation of $2,545,511, the DCA has determined that $1,637,792 is the "regular NSP allocation" and $907,719 is the supplemental allocation which is to be dedicated for rental housing to meet the low-income requirements of the NSP (referred to as the "NSPLI allocation"); use of the NSPLI allocation must be allocated specifically to rental housing for low-income households which earn no more than 50% of the AMI (for cone-person household 50%AMI is a maximum of $21,100). Use of the regular NSP funds must benefit those households whose incomes do not exceed 120% of Area Median Income (AMI). The DCA has also added strict spending deadlines for use of the NSP funds: The City, assub-grantee, has just 10 months to obligate its allocation or risk forfeiting it. The regular NSP funds may be used for activities including: • Purchasing and rehabilitating abandoned or foreclosed homes and residential properties • Establishing financing mechanisms (down-payment assistance, soft-second mortgages) for purchase and redevelopment of foreclosed homes and residential properties • Creating "land banks" to assemble, temporarily manage, and dispose of vacant land for the purpose of stabilizing neighborhoods and encouraging re-use or redevelopment of property • Demolishing or rehabilitating abandoned properties City Commission Memorandum Neighborhood Stabilization Program /Planned Use of Funds March 18, 2009 Page 2 of 3 A recommended use for all of the NSP funds is outlined below. Once the policy decision is made regarding the use of the NSP funding, a competitive process will be conducted in which the City will seek a sponsor or sponsors with demonstrated capacity and experience in providing housing to the target populations to provide the required services. RECOMMENDATION As stated above, the NSPLI of $907,719 must be utilized to assist in the purchase of units which ultimately are kept and rented to households earning no more than 50% AMI. The Administration recommends using the NSPLI to assist in the purchase of one or more foreclosed or abandoned multi- unit buildings to meet this requirement. Although the regular allocation ($1.6 million) can be used for other purposes, including buying units to resell them, at this time the Administration recommends that the regular allocation also be utilized for purchase of a foreclosed or abandoned multi-unit apartment building, with the end purpose of renting all of the units to income qualified households-which in the case of the regular allocation are households earning up to 120% AMI. While staff initially recommended using the regular NSP funds to provide assistance to homebuyers to purchase individual foreclosed condominium units, due to the volatility of the real estate market, at this time the Administration recommends that NSP funding be used primarily to purchase foreclosed or abandoned multi-unit buildings for rental housing, or alternatively the regular NSP funds may be used to create land banks, for these reasons: • In Miami Beach, the majority of foreclosed housing units available for purchase for income qualified homebuyer applicants of NSP would be in multi-unit condominium buildings. The purchase and re-sale of scattered sites to our required target population poses the risk of having the new owner face unanticipated condo fees and/or assessments arising from other foreclosed units in the building and owners of other condo units defaulting on their condominium dues. Purchasing an entire building, in contrast, means that the project sponsor is in the best position to control management costs. • Buying multi-unit buildings, or foreclosed or abandoned land, instead of individual scattered sites most efficiently meets the 10 month obligation-of-funding deadline that the DCA requires, thus minimizing the possibility of the City forfeiting its allocation. There is a chance that the City may receive additional funding since forfeited NSP money throughout the state will be reallocated by the DCA to communities having met their obligation deadline. • The NSPLI allocation of $907,719, requiring the purchase of units to be rented to households at 50%AMI, comprises approximately 35% of the City's allocation. Dedicating the regular allocation funding portion to the same purpose as NSPLI will allow for mixed income levels in the rental buildings purchased, since the regular allocation allows families earning up to 120% AMI. Having higher income families in the same building as those households at 50%AMI better enables the project sponsor to charge higher rents and better meet all the carrying costs inherent in owning the rental building(s). While it is impossible to predict the actual number of qualifying foreclosed or abandoned multi-family properties available for purchase when funding is received, preliminary research undertaken by staff on Real Quest, a reliable real estate search engine, indicates that on March 9, 2009 there were a total of 18 multi-unit REOs within the 33139, 33140 and 33141 zip codes, and 40 properties within the same zip codes showing a Lis Pendens status (potential pre-foreclosure). It is unknown how many other buildings would also qualify as eligible for NSP funding that are abandoned. In the event there are funds remaining after the purchase of one or more multi-unit buildings, or the City receives additional NSP funding, the Administration would then recommend the purchase of condominium units for resale to income qualified homebuyers. The selected sponsor would be required City Commission Memorandum Neighborhood Stabilization Program/Planned Use of Funds March 18, 2009 Page 3 of 3 to engage in the necessary due diligence in advance of any condo unit purchase so as to determine, to the extent possible, the financial health of the condominium association, as well as its future health. This would also ensure the homebuyer has sufficient capacity to address any fluctuations. The competitive process to secure a sponsor(s) shall solicit and accept applications for this secondary homeownership activity, with the understanding that this activity will be funded only as funding may be available. For both activities, preference in scoring will be given to applicants who can demonstrate the ability to leverage other funds, including private financing. It should be noted that the City awarded State Housing Initiative Partnership (SHIP) funds for fiscal years 2007/08 and 2008/09 for first time homebuyers to purchase and rehabilitate, as needed, foreclosed homes. As such, other funding is currently available to assist in homebuyer assistance for foreclosed properties. COMMITTEE REVIEW AND RECOMMENDATION At the Neighborhoods/Community Affairs Committee meeting of March 11, 2009, the Committee considered the recommended strategy for the use of the regular and NSPLI allocations. Committee members expressed their interest in preference being given for rental units made available from the purchase of one or more multi-family buildings to serve moderate income [workforce] families. Additionally, the Committee recommended that the Commission also consider, after the competitive process is concluded, whether the regular NSP funding should alternatively be used for the purchase of foreclosed or abandoned land for land-banking purposes. Subsequent to the Committee meeting, staff reviewed the NSP guidelines and has confirmed that a maximum of ten (70) percent of the NSP allocation to the City may be used for land banking activities. Attached, please refer to page 6 of the NSP application that references this limitation. OTHER FORECLOSURE-RELATED FUNDING Related to foreclosure prevention activities, the federal government, as part of its latest stimulus package, has informed the City that it will receive Homeless Prevention Funds in the amount of $715,418. Funds provided under this grant may be used for homelessness prevention and re-housing of persons who have become homeless, including activities such as housing search, mediation or outreach to property owners, credit repair, rental and utility assistance, and moving costs. The full program guidelines have not yet been released. Due to stimulus funding, the City will also receive an additional $467,896 in Community Development Block Grant (CDBG) funding for FY 2009/10. Furthermore, it is anticipated that additional NSP-type funding will be made available to entitlement communities on a competitive application basis. Details have not been provided on when or how the additional NSP fund may be used. CONCLUSION The Administration recommends that the Mayor and City Commission of the City of Miami Beach, Florida, adopt a resolution approving the City's planned use of and related application for Neighborhood Stabilization Program (NSP) funds, in the amount of $2,545,511, to purchase and rehabilitate, as necessary, one or more foreclosed or abandoned multi-family buildings in the City of Miami Beach as determined by the City's greatest need, to be made available as rental properties for income qualified households. The Neighborhoods Committee has further recommended a preference that those rental units serve moderate income workforce families and that, alternatively, depending on the outcome of the competitive process, that the City may consider using regular NSP funds may be used~to create land banks to assemble, temporarily manage, and dispose of vacant land for the purpose of stabilizing neighborhoods and encouraging re-use or redevelopment of property, in accordance with NSP rules, as promulgated by the Florida Department of Community Affairs and the United States Department of Housing and Urban Development. T:WGENDA\2009\March 18\Regular\NSP Application FINAL memo.doc STATE OF FLORIDA NEIGHBORHOOD STABILIZATION PROGRAM APPLICATION INSTRUCTIONS DUE DATE APRIL 6, 2009 FLORIDA DEPARTMENT OF COMMUNITY AFFAIRS CDBG NEIGHBORHOOD STABILIZATION PROGRAM 2555 SHUMARD OAK BOULEVARD TALLAHASSEE, FLORIDA 32399-2100 850/487-3644 FAX 850/922-5609 GENERAL INFORMATION Florida's Neighborhood Stabilization Program (NSP) is described in the Substantial Amendment to the 2008 Community Development Block Grant (CDBG) Program Action Plan which is posted to the website at: http://www.floridacom-nunitydevelopment.org/cdbg/nsp.cfm. Please read and refer to the Substantial Amendment as you prepare your Application. Additional information will be available in the NSP Emergency Rule and Policy Guide, Under the State's allocation formula, 26 local governments are eligible for assistance. The Department allocated funds in a manner that will ensure that at least ZS percent of the funding will serve individuals at or below 50 percent of the area median income (AMl). Applications must include the total amount allocated to your jurisdiction by the Department. Regular State NSP allocations with minimum grant awards of $1.25 million are available to the following communities: Local Government Allocation Included Cities Jurisdiction County Amount (not funded by HUD or State) Alachua County Alachua $1,411,917 All cities included Bay County Bay $1,615,436 All cities included Titusville Brevard $1,625,481 N/A Melbourne Brevard $1,343,243 N/A Davie Broward $1,715,568 N/A Charlotte County Charlotte $5,364,020 All cities included Citrus County Citrus $1,478,164 All cities included Clay County Clay $2,722,894 All cities included Palm Coast Flagler $2,177,980 N/A Hernando County Hernando $4,299,472 All cities included • Indian River County Indian River $3,598,543 All cities included Tallahassee Leon $1,693,435 N/A Bradenton Manatee $1,975,077 N/A Ocala Marion $1,313,887 N/A Martin County • Martin $2,645,982 All cities included Miami Beach Miami-Dade $1,641,832 N/A Okaloosa County Okaloosa $2,255,252 All cities included Apopka Orange $1,547,689 N/A Osceola County Osceola $11,524,826 All cities included EXCEPT Kissimmee Delray Beach Palm Beach- $1,351,043 N/A Clearwater Pinellas $2,034,862 N/A Santa Rosa County Santa Rosa $1,662,215 Al] cities included St. Johns County St. Johns $1,761,096 All cities included 2 Local Government Allocation Included Cities Jurisdiction County Amount (not funded by HUD or State) Ft. Pierce St. Lucie $1,505,403 N/A St. Lucie County St. Lucie $3,14.4,510 All cities included EXCEPT Ft. Pierce & Port St. Lucie Daytona Beach Volusia $1,668,161 N/A Total = $65,077,988 A separate funding allocation, NSP Low Income (NSPLI), provides supplemental funding to each geographic area receiving a regular state allocation ba sed on both its proportionate allocation of regular state NSP funds and its proportionate concentration of NSPLI target population. This allocation. ensures that 25 percent of the funding is made available to individuals whose incomes do not exceed 50 percent of the AMI. These funds must be used to provide rental housing. Applications must show these funds reflected under Strategy 5 and that they will be allocated for rental housing. Local Government Allocation Included Cities Jurisdiction County Amount (not funded by HUD or State) Alachua County Alachua $1,517,321 All cities included Bay County Bay $908,311 All cities included Titusville Brevard $488,300 N/A Melbourne Brevard $576,948 N/A Davie Broward $600,724 N/A Chazlotte County Charlotte $1,423,037 All cities included Citrus County Citrus $693,256 All cities included Clay County Clay $915,629 All cities included Palm Coast Flagler $486,923 N/A Hernando County Hernando $1,344,912 All cities included Indian River County Indian River $1,082,282 All cities included Tallahassee ~ Leon $1,252,235 N/A Bradenton Manatee $601,190 N/A Ocala Marion $429,318 N/A Martin County Martin $891,481 All cities included Miami Beach Miami-Dade $907,719 N/A Okaloosa County Okaloosa $1,003,183 All cities included Apopka Orange $362,277 N/A Osceola County Osceola $2,566,992 All cities included EXCEPT Kissimmee Delray Beach Palm Beach $553,962 N/A 3 Local Government Jurisdiction County Allocation Amount Included Cities (not funded by HUD or State) Clearwater Pinellas $810,889 N/A Santa Rosa County Santa Rosa $703,188 All cities included St. Johns County St. Johns $728,347 All cities included Ft. Pierce St. Lucie $579,993 N/A St. Lucie County St. Lucie $840,091 All cities included EXCEPT Ft. Pierce & Port St. Lucie Daytona Beach Volusia $694,981 N/A Total = $22,963,490 RULES AND REGULATIONS All applications must meet the intent of the federal regulation and comply with the State's special requirements. Applications should review the following sources of information before beginning the application process. 1. Federal Register Notice dated October 6, 2008 2. State's Substantial Amendment to the 2008 CDBG. Action Plan 3. State NSP Emergency Rule 4. State NSP Policy Guide Additional information, including responses to frequently asked questions, may be accessed at the following websites: 1. HUD NSP website: http://www.hud.eov/offices/cpd/communit development/programs/neighborhoodspg[ 2. State of Florida NSP website: htta://www.floridacommunitydevelopment org/cdb~p cfm CITIZEN PARTICIPATION Citizen participation, including the participation of stakeholders or affected municipalities, is an important part of the application process. Applicants must conduct a public hearing on the proposed application prior to submitting it to the Department. Specific requirements are set out in the State's NSP Policy Guide. GENERAL INSTRUCTIONS 1. Prepare a narrative that describes the overall strategy the Applicant will use to address priority needs related to ', foreclosed and abandoned properties, particularly those that are residential (single or multi-family, owner or renter-occupied). Describe how the "area(s)" or "jurisdiction(s)" to be served as well as the "activities" to be undertaken meet a priority need. Identify the estimated amount to be expended and provide a time line for I accomplishing major actions. 2. Submit one Application reflecting priority needs even if activities will take place in more than one area or jurisdiction. (Copies can be made of application pages as necessary.) 3. Submit two copies of the Application, with original signatures of the Chief Elected Official or individual authorized by resolution to sign on behalf of the local government. If applicable, submit a copy of the resolution. 4 4. Provide the following information in numbered appendices: (a) A detailed map depicting the boundaries of the jurisdiction(s), the NSP target area(s), the anticipated location of the activities, the flood plain and other relevant details such as the location and concentration of foreclosed and abandoned properties. (b) Identify any policies that the local government currently has adopted that related to CDBG (i.e., citizen complaint policy, acquisition and relocation policy, fair housing plan, procurement policy, housing assistance plan, etc.). These policies will be reviewed during the site visit prior to execution of the Award Agreement. 5. Comply with the Intergovernmental Coordination and Review (Clearinghouse Review) process outlined below. (a) Mail one copy of the Application to the Florida State Clearinghouse, Department of Environmental Protection, Commonwealth Building, Tallahassee, Florida 32399. (b) A transmittal letter should accompany the materials requesting that the Clearinghouse send copies of any correspondence to the Applicant and to the Department of Community Affairs. 6. Submit one copy of the Application to the Regional Planning Council that serves the jurisdiction(s). 7. Submit one copy of the Application to the State Historic Preservation Office, Florida Department of State, 500 South Bronough Street, Tallahassee, Florida 32399-0250. 8. Begin now to collect the documentation for HUD's environmental review process. Technical assistance resources are available online at www.Floridacommunitydevelopment.org/cdbg/environmental. I. APPLICANT INFORMATION FORM Under Applicant Information, provide general information relating to the State recipient of the funds (the Applicant), including legislative districts, and person(s) or organization that assisted with the preparation of the application. Indicate whether or not the jurisdiction(s) or neighborhood(s) to be served aze located in a flood plain. Also, indicate whether or not compliance with federal and state historic preservation standards may be applicable. Flood plain and historic preservation issues will need immediate attention once an Award Agreement is executed by the Department. II. APPLICANT'S NEIGHBORHOOD STABILIZATION PLAN Applicants must prepare an overall narrative description of the plan to utilize NSP funds to address abandoned and foreclosed properties in areas of greatest need. The information should specify where there are a large number of abandoned or foreclosed properties and whether or not the area identified will be addressed. If another target area is selected, the Applicant must explain why the use of the funds in such area will make a more meaningful impact. The Plan should describe all activities that are proposed to be undertaken, sources of any other funds (such as SHII', CDBG, local general revenue, etc.) that will be used with State NSP funding, and where possible what parties the Applicant will work with to implement the Plan. III. NSP STATEGY As noted in the NSP Strategy descriptions in the application, each activity addresses either homeownership or rental OR both homeownership and rental. Keep this in mind as you plan your project. All activities must meet the national objective of providing benefit to low, moderate and middle income persons as described in the Federal 5 Register Notice and must be directly related to the Applicant's overall plan to address foreclosed and abandoned housing. The state will restrict the amount of funding allocated to land banking to 10 percent of the overall allocation, excluding the funds set aside for rental housing for low income persons. For each of the NSP strategies you plan to undertake, provide: D The total NSP Budget that will be allocated for the strategy. D A justification for selecting the target area and why you propose to undertake the NSP strategy. (This justification should be somewhat different for each strategy.) D II known, potential Nonprofit or For-Profit Subrecipients (including Property Management Companies), Potential Lending Partners, and Potential Counseling Agencies. D A tentative timeline that, in general, reflects the start dates for each of the activities that will be conducted under the particular NSP strategy. D Proposed accomplishments and beneficiaries by income level. D A description of any unmet need that you wish to be taken into consideration should recaptured funds from another grantee or program income be made available for persons at or below 50 percent AMI. Please note that NSP Strategy #5 includes the 25 percent set-aside for rental housing. Provide the amount of funds that will be used for rental housing from the regular allocation and include the amount of the set-aside allocated to the Applicant. Overall program administration costs cannot exceed 6.8 percent of the allocation. All activity delivery costs should be included in the non-administration activity (i.e. rehabilitation, acquisition, disposition, etc.) and should not be reflected as overall program administration. Be sure that the information entered on the budget forms corresponds to the narrative pages. IV. ASSURANCES, CERTIFICATIONS AND SIGNATURE This section includes a list of federal regulations, certifications of documentation, and other assurances required for submission with this application. The local government jurisdiction must certify the validity and availability of statements and data contained within the application. Applications must contain original signatures of the Chief Elected Official or individual authorized by resolution to sign on behalf of the local government. If applicable, submit a copy of the resolution. 6 ATTACHMENT A BUDGET, PROPOSED ACCOMPLISHMENT AND BENEFICIARIES INSTRUCTIONS Each Recipient must submit a project budget and proposed accomplishments and beneficiaries for each activity undertaken. This information should be provided on an Attachment A -Activity Form. ATTACHMENT A -Activity and Budget Summary: This form should reflect the total budget (and related information) for all activities. o Activity -enter specific activities to be carried out on the appropriate Activity form. After all forms have been completed, summarize the information on the Attachment A -Activity and Budget Summary. o Accomplishments -Enter the unit of measure and estimated number of units to be addressed. o Beneficiaries -Enter the estimated number of low, moderate and middle income beneficiaries as required for the activity. o Budget -Enter the amount of NSP funding that will be allocated to the activity. Enter the amount budgeted for overall program administration separately (this amount should not include project delivery costs). Enter the amount of other funds that will be allocated to the activity and identify the source of the other funding. o Please note that Strategy 5 and the Summary require that you identify the total amount of NSP funding for activities that will benefit persons at or below 50% AMI INSTRUCTIONS FOR PREPARING AN ESTIMATED PROJECT BUDGET The "Cost Standard Used" to estimate project costs will be reviewed by the Department for reasonableness. The Department reserves the right to request justification of the cost reasonableness of any budgetary item. )f the Applicant cannot justify a cost, the Department will reduce the line item budget prior to entering into a contract. If the Applicant wishes to be reimbursed for the cost of preparing the application, the eligibility of the expense must be documented. To be an eligible expenditure, the following requirements apply: o The Preparer must have been procured pursuant to 24 CFR Section 85.36, as it existed on the day of advertising for the Reques[ for Proposals. o If the Recipient's staff prepared the Application, or if the staff of another governmental agency was selected pursuant to Chapter 287, Florida Statutes, the Recipient may seek payment only for duect costs incurred as part of the grant proposal preparation. o Invoices or other documentation to justify the amount requested must also be included. The Department will review this procurement or expense, and if it determines that the procurement process or contracting process was not carried out correctly, or the expense is ineligible, the Department will disallow the expense. 7 ATTACHMENT B HOUSING ASSISTANCE PLAN INSTRUCTIONS A Housing Assistance Plan must accompany the application, and the following criteria must be marked or highlighted for easy location by Department staff during the application review. The Housin A~; ssistance Plan must address at least the following items: Type of Assistance The terms and conditions under which assistance will be provided. The process for soliciting, accepting, reviewing and approving requests for assistance, including any proposed geographic distribution. The following should be addressed: 1. A process to notify members of the local governing body of the names of the beneficiaries selected to ensure that potential conflicts of interest are timely addressed. 2. Establishes a formal written notification process that advises when a previously selected housing unit is deleted from the rehabilitation program. 3. A process for soliciting assistance which includes a reasonable notice or advertisement in the community that specifies the following: ^ Where individuals can gain access to an application, if applicable; ^ The period during which applications will be received, if appropriate; ^ Criteria for selection; ^ A ranking/scoring process with higher points given for extenuating circumstances, and ^ Whether or not the local government will assist in the acquisition and rehabilitation of foreclosed or abandoned mobile homes, modular homes or other forms of manufactured housing. Types of insurance (fire, casualty, flood etc.) that will be required, at what points in time the insurance must be in effect, and length of time after administrative closeout of the grant that it must be maintained. Rehabilitation Standards The process for determining what work must be done on each housing structure acquired and rehabilitated with NSP funds to ensure that upon completion, the housing unit will meet all of the following standards: 1. HUD Section 8 Housing Quality Standards (24CFR982.401) 2. Local zoning ordinances 3. State of Florida Building Code 4. Local building code 5. Modern, green building and energy-efficiency improvements 6. Florida Energy Efficiency Code for Building Construction (Newly Constructed Housing) 7. Accessibility requirements of 24 CFR Part 8, 24 CFR100.201, and 24 CFR100.205 8. For manufactured housing, 24 CFR Part 3280 (Preempts state and local codes covering the same for manufactured housing) A process to ensure that before initiation of housing rehabilitation, the property on which the unit is located meets other appropriate local codes (i.e., nuisance, trash, and other environmental or health codes). The types of insurance (fire, casualty, flood etc.) that will be required, at what points in time the insurance must be in effect, and length of time after administrative closeout of the grant that it must be maintained. The process for determining when the rehabilitation is completed, including final acceptance of a contractor's work and final inspection of a housing structure (example: Certificate of Occupancy issued by local building inspector). A process for ensuring ownership of non-rental housing units by the occupying beneficiary, or the process for ensuring the legal status of the occupying beneficiary to encumber the property, and to provide permission for a contractor to undertake construction work on the housing unit. The process that will be used to solicit contractors and assist in reviewing the contractor's performance including the following requirements: 1. Bids for rehabilitation or reconstruction of housing units must specify that they shall only be accepted from contractors licensed by the State of Florida, Department of Business and Professional Regulation. 2. The Contractor must agree in his or her bid and subsequent contract, that any change orders for rehabilitation or reconstruction of housing units which cumulatively exceed one thousand dollars ($1,000) above the original contract amount, shall only be paid with CDBG funds if those change orders are to correct documented code violations based on a bonafide code violation report or to meet Section 8 Housing Quality Standards. ' 3. The Contractor must agree in his or her bid and contract that all change orders for NSP housing rehabilitation or reconstruction shall be approved by the contractor and a representative of the local government prior to any initiation of additional work based on that change order. The process of determining the age of housing units to be addressed and the actions to take with the Bureau of Historic Preservation when addressing units more than 50 years old. A lead-based paint abatement procedure to follow when addressing pre-1978 houses. A procedure for addressing structures in the 100-year flood plain. Specifies that the local government will document the completion of construction by ensuring that each housing unit case file shall contain the following information: 1. A statement from the contractor that all items on the initial work write-up as modified through change orders have been completed; 2. An acknowledgment that the housing unit meets the applicable local code and Section 8 Housing Quality Standards, signed and dated by the local building inspector; This documentation shall be completed prior to the submission of the administrative closeout package and shall accompany the administrative closeout package when submitted to the Department; and Rental Assistance For the acquisition and/or rehabilitation of rental housing structures with NSP funds, the policy must address the following: 1. Terms and conditions for providing assistance (i.e., loan or grant); 2. How ownership will be verified; and 3. .What steps the local government will take to ensure that, after rehabilitation, NSP Assisted rental housing rehabilitation wit) meet or exceed the requirements established in 24 CFR 92.252(e) beginning after the structure is complete (period of continues affordability). Acq uisi tion/Purchase 1. Ordering appraisal. 2. Negotiating contract with current owner. If owner accepts contract, the contract will then go to the 9 owner's lender for approval, which can take up to 3-4 months (this is a "short-sale," which means that the owners are delinquent in their mortgages and are trying to avoid foreclosure by asking their lender to accept less than they are owed). FYI: there are two mortgages on this property ($94,850 and $27,100). 3. Ordering environmental assessment (to make sure no hazardous materials on property, etc.). 4. Ordering survey (to make sure there are no encroachments). 5. Ordering title search (to make sure title is clear and no unresolved liens). 6. Handling the closing. 7. Establishes the conditions under which a housing structure will be demolished or converted to non-LMI housing structures. Disposition/Sale 1. Marketing and locating prospective home buyer. 2. Taking a prospective home buyer from the waiting list that will be established to determine eligibility. 3. Establishes a formal written notification process that advises a homebuyer when a previously selected housing unit is deleted from the program. 4. Work with a local non-profit agency that will assist the prospective home buyer in obtaining mortgage financing. 5. Assist horse buyer with down payment assistance, if applicable. 6. Terms of the mortgage. 7. If applicable, transfer property to non-profit agency. 8. Show house to prospective home buyers. 9. Handle the purchase agreement with home buyer. 10. Handle the sale to home buyer (including all paperwork required for sale). Homeownership Assistance 1. Types of financing to be provided. 2. Terms of assistance. Homeownership Counseling Establishes process for providing the required eight hours of homeownership counseling as required under NSP. Counseling must be classroom style, individual (one on one) or a combination of both formats. Conflict of Interest Pursuant to 24 CFR Section 570.489 and Chapter 112.311-112.3143, FCorida Statutes, address conflicts of interest by establishing a process for the following: 1. Identifying potential conflicts of interest {contractors as well as beneficiaries); 2. Acknowledging by name in the minutes of the Citizens Advisory Task Force and commission/council meetings so that previously unknown conflicts may be surfaced; 3. Making khose conflicts publicly known along with the final rankings based on the criteria outlined in the local government`s housing assistance plan; 4. Dealing with those conflicts on a local level; and 5. Requesting waivers of those conflicts when appropriate. Closeout Documentation The following data must be provided by housing unit and summarized by activity as part of the administrative closeout for each activity providing direct benefit (i.e., housing rehabilitation, temporary relocation, hookups, etc.): 10 I. Address of each housing unit acquired and/or rehabilitated with NSP funds, the date the construction or sale was completed on the housing unit, and the amount of NSP funds spent on that housing unit; 2. Whether the household is headed by a female, the number of handicapped persons in the household, the number of elderly persons in the household, and the LMMI status of the household; 3. The number of occupants in the household, categorized by sex; and 4. The racial demographics of the head of household by number (White, Black, Hispanic, Asian/Pacific Islander, or American Indian/Alaskan Native). 11 INCOMPLETE APPLICATIONS The information presented in the application will be considered the Applicant's plan to address foreclosed and abandoned properties with NSP funding. If a local government submits an application that is insufficient for the Department to determine whether or not it meets the intent as stated in the federal register notice, State Substantial Amendment to the 2008 Action Plan or other guidance provided by the Department, the local government will be asked to provide clarification or additional information. Such clarification or additional information must be received within 21 calendar days. OTHER REQUIREMENTS Experience. If the Applicant does not have at least 5 years experience providing rental housing to the NSPLI tazget population, it must either partner with one or more local housing authorities or non-profit organization in the county with such experience or designate one to be the eligible applicant for supplemental funding. Interlocal Agreement. If an Applicant will conduct public facility or infrastructure projects within the boundaries of another jurisdiction, an interlocal agreement must be submitted with the application for funds. Housing acquisition and disposition, including homeownership assistance and counseling, will not require an interlocal agreement. Land Bankine. Applicants that plan to use funds for land banking must develop a strategic plan for the acquisition, redevelopment and disposition of land banks purchased with NSP funds. The plan must be submitted as part of the Application and will be reviewed and approved prior to awarding NSP grant funds for this activity. All plans must incorporate a requirement that the land bank may not hold the property for more than ten (10) years without obligating the property for a specific NSP eligible activity. Aland bank plan should address the following: (1) If awarding funds to a nonprofit for land banking, indicate what type of nonprofit and how you will determine their capacity to carry out the NSP requirements. (2) Describe in general terms how land bank properties will be acquired and temporarily managed. If possible, provide information on the tentative NSP target area. (3} Provide detailed information concerning when and how you will obligate the property for a specific, eligible redevelopment in accordance with NSP requirements. (4) Include a timeline that indicates the timeframe for acquisition, temporary management and redevelopment TECHNICAL ASSISTANCE List topics that you will need technical assistance on to administer the program within the given timeframe: 12 Neighborhood Stabilization Program Grants -Questions and Responses -Community De... Page 1 of 1 NSP Frequently Asked Questions Community Planning and The following are links to Frequently Asked Cy1 Lnfurm?tvn..ltx~Saie DevE:lopment Questions divided by category. I?rint_X~[sl4n 0 CammunitY Gevelol.rment L7Proyrams • ~quisition & Relocation 0 CDBG Entitlement . gcijQr~P.~~.Lt..Alnend~ll.e!]t~ Communities . Affordabllity_.Rgpulrements ~ State Administered . Derrlolitio~) CDBG ~ Section 108 . pistribution of Funds 0 Non Entitlement CDBG • DRG~, Grants In Hawaii • E~ig'ti 7 PI .Use ScgnariQ~. O cone Insular Areas . Envjronm~ntal Revig nLf O Disascer Fiecover•v . Financing Mechanisms Assistance • ~_Q~~la AIIoS,,~~Q!! O Neighbor•liood • Homeownership! Counseling, Stabilization © colonial • Land Banks . 25% Low-Income Set-Aside HUD news • Nip Information S4~jQ.D.~ Program Administration Homes . program Income • Prorating NSP Funds Resources P~~l~c FacilitiE~~ Communities • Public Housing. . p rchase Discount Working with HUD u • Redevelo m n • gggulatory Informa~LQr1 Tools . ~tghabiiitatign Standar webcasts . State Distributions Mailing lists . Tax Liens RS3 Feeds . Ti~Ileliness of I~s~~~i~e.Q.lr.~i ure of NSP Funds, Help ~„ ~ Vlew all Frequently Asked Questions. j T~ T ~ LJ-.J~.{~OII o Complete List Government Mnde Escy Content current as of 5 December 2008 ® Back to top X019 Pr(Ya~V 1fVS.kLP__o11S1e5..a11Q~mpo[tanL~laks i~4m@ ~_ ~•"`"'a U.S. Department of Housing and Urban Development d• ~~ill, 8 451 7th Street S.W., Washington, DC 20410 ~IIIII~~' ~ Telephone: (202) 708-1112 TTY: (202) 708-1455 t0 eN^ ~~r Flnd the aQQfesq of a HUD office near you http://www.hud. gov/offices/cpd/coinmunitydevelopment/programs/neighborhoodspg/nspf... 03/12/2009 LANll BANKS Updated 12/5/08 Can land banking include purchasing a foreclosed or abandoned property that has a structure on it or does the property have to be vacant land? As stated in the statute "[NSP funds can be used to] establish land banks for homes that have been foreclosed." Therefore, in order to acquire property for land banking purposes, the property must have a structure on it.