NSP 3 Grant Agreement olf- c 2 7 0�
NEIGHBORHOOD STABILIZATION PROGRAM 3 GRANT AGREEMENT
BETWEEN THE CITY OF MIAMI BEACH AND
MIAMI BEACH COMMUNITY DEVELOPMENT CORPORATION
This Agreement made and entered into this 9 day of 2012
(Effective Date), by and between the CITY OF MIAMI BEACH, a Florida municipal corporation having
its principal office at 1700 Convention Center Drive, Miami Beach, Florida, 33139, (hereinafter referred
to as "City "), and MIAMI BEACH COMMUNITY DEVELOPMENT CORPORATION, a not -for profit
corporation having its principal office at 945 Pennsylvania Avenue, Miami Beach, Florida, 33139
(hereinafter referred to as "Sub- recipient ").
WHEREAS, on September 8, 2010 the U.S. Department of Housing and Urban Development
(HUD) announced funding provided under the Dodd -Frank Wall Street 'Reform and Consumer
ProtectionAct,.creating the Neighborhood Stabilization Program 3 (NSP3); and .
WHEREAS, on December 29, 2010, a copy of the Substantial Amendment was posted on
the Office of Real Estate, Housing and Community Development website in accordance with HUD
requirements and, on December 30, 2010, a notice of public hearing was published in The Miami
Herald; and
WHEREAS, on February 9, 2011, the City Commission adopted Resolution No. 2011- 27601,
approving a Substantial Amendment to the City's FY2008 -2012 Consolidated Plan and FY2010 -2011
Action Plan to allocate $1,327,579 to the City's subrecipient, Miami Beach Community Development
Corporation (MBCDC), for rehabilitation of Phase 1 of The London House Apartments,, located at 1965
Washington Avenue (the Project); and
NOW, THEREFORE, in consideration of the mutual benefits contained herein, the City and
Sub- recipient agree as follows:
Section 1. Agreement Documents: Agreement documents shall consist of this Agreement and
the following four (4) attachments, all of which are attached and incorporated in this
Agreement:
• Attachment I — Phase 1 Project Narrative, which contains a description of the Project.
• Attachment II — Line Item Budget Dated January 7, 2011.
Attachment III — HUD Funding Approval and Grant Agreement, dated March 8, 2011
• Attachment IV — Applicable Federal Regulations.
Section 2. Statement of Work: Sub - recipient agrees to implement the Project in accordance with
Attachments I and 11, and as summarized as follows:
The London House Apartments located at 1965 Washington Avenue, .Miami Beach,
FL 33139 (also referred to as the "Property ").
Phase 1 Rehabilitation of six (6) multi - family units
Section 3. Agreement Amount: Subject to the availability of funds, the City agrees to make
available ONE MILLION, THREE HUNDRED TWENTY -SEVEN THOUSAND, FIVE
HUNDRED SEVENTY -NINE DOLLARS ($1,327,579) for use by the Sub - recipient
during the Term of the Agreement (hereinafter, the aforestated amount including,
without limitation, any additional amounts included thereto as a result of a subsequent
amendment(s) to the Agreement, shall be referred to as the "Funds ").
Section 4. Alterations: Any proposed changes in the Project including, without limitation, the
Budget in Attachment II, shall first be submitted, reviewed, and approved, in writing, by
the City Manager, which approval, if given at all, shall be at his /her sole reasonable
judgment and discretion.
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Section 5. Method of Payment and Reporting Requirements: MBCDC may request a
drawdown of a portion of the Funds for the expected cash needs within the first three
(3) months of the Term (as defined herein), in accordance with the projections itemized
in Attachment 1 -B. Any advance payment is subject to Federal OMB Circulars A -87, A-
10, A -22, and the Cash Management Improvement Act of 1990. During the Term, Sub
recipient shall submit quarterly Project progress reports to the City on the 10 day of
January, April, July, and October, respectively. Reporting forms to be used in
fulfillment of this requirement shall be provided by the Program Monitor. Sub - recipient
shall also submit a Project close -out report (Final Report), thirty (30) days after
completion of the Project ( "completion" being herein defined as the issuance of a final
Certificate of Use (CO) or Certificate of Occupancy,(CC), covering the agreed -upon
Project goals and objectives; expenditures during the term; and performance data on
client feedback.
Other reporting requirements may be required by the City Manager in the event of
Project changes; the need for additional information or documentation arises; and /or
legislative amendments are enacted.
Reports and /or requested documentation not received by the due date shall be
considered delinquent and may be cause for default and termination of this Agreement,
pursuant to Section 12 hereof.
Section 6. Monitoring: At its discretion, the City may schedule at. least one (1) annual on -site
monitoring visit with the Sub - recipient to evaluate the progress of the Project, and /or to
provide technical assistance. At the City's option, a desk top review of the activities
may be conducted in lieu of an on -site visit.
Section 7. Additional Conditions and Compensation: The parties acknowledge that the Funds
originate from NSP3 grant funds from HUD, and must be implemented in full
compliance with all of HUD's rules and regulations. In the event of curtailment or non-
production of said federal funds, the financial sources necessary to continue to pay the
Sub- recipient all or any portions of the Funds will not be available. In that event, the
City may terminate this Agreement, which termination shall be effective as of the date
that it is determined by the City Manager, in his /her sole discretion and judgment, that
the Funds are no longer available. In the event of such termination, the Sub - recipient
agrees that it will not look to, nor seek to hold the City, nor any individual member of
the City Commission and /or City Administration, personally liable for the performance
of this Agreement, and the City shall be released from any further liability to Sub -
recipient under the terms of this Agreement.
Section 8. Compliance with Local, State and Federal Regulations - The Sub - recipient agrees
to comply_ with all applicable Federal regulations as they may apply to Project
administration and to carry out each activity in compliance with the laws and
regulations as described in 24 CFR 570 Subpart K, as same may be amended from
time to time. Additionally, the Sub - recipient will comply with all State and local (City
and County) laws and ordinances hereto applicable. It shall be the Sub - recipient's sole
and absolute responsibility to continually familiarize itself with any and all such
applicable Federal, State, County, and City regulations, laws, and /or ordinances.
Section 9. Restrictions for Certain Resident Aliens - Certain newly legalized aliens, as
described in 24 CFR Part 49, are not eligible to apply for benefits under covered
activities funded by the NSP3 Program. "Benefits" under this section means financial
assistance, public services, jobs, and access to new or rehabilitated housing and other
facilities made. available under activities funded by the NSP3 Program. "Benefits" do
not include relocation services and payments to which displacees are entitled by law.
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Section 10. Assignment/Subcontract: No part of this Agreement may be assigned or
subcontracted without the prior written consent of the City, which consent, if given at
all, shall be at the City's sole discretion and judgement.
Section 11. Term: This Agreement shall commence following execution by all parties, as
referenced in the date on page 1 of the Agreement (the Effective Date), and shall
terminate on March 8, 2014, (the Term), with the understanding that the end of the
Term shall also be the end of the expenditure deadline, as mandated by the Funds
Agreement between HUD and the City, dated March 8, 2011, Attachment III; and that
no funds will be available thereafter. The Sub - recipient shall expend 50% of the Funds
prior to March 8, 2013, and the remaining balance prior to the end of the Term. Any
costs incurred by the Sub - recipient prior to the Effective Date which were not approved
by the City, will not be reimbursed by the City.
Section 12. Termination of Agreement:
12.1 Termination for Convenience: This Agreement may be terminated by the City,
for convenience and without cause, through the City Manager, upon 30 days prior
written notice to Sub- recipient. In the event of such termination for convenience,
the City shall cease any payments to Sub - recipient for costs resulting from
obligations which were not approved before the effective date of termination.
Sub- recipient shall be solely responsible for immediately returning any unused or
unapproved Funds as of the date of termination, and shall also be solely
responsible for submitting a final report, as provided in Section 5 hereof, (detailing
all Project objectives, activities and expenditures up to the effective date of
termination). Said final report shall be due within five (5) working days following
the effective date of termination. Upon timely receipt of Subrecipient's final report,
the City, at its sole discretion, shall determine the amount (if any) of any additional
portion of the Funds to be returned to the City as a result of any unapproved or
unused Funds s, or incomplete Project items, and shall provide Sub - recipient with
written notice of any monies due. Said additional monies shall be due and
payable immediately upon 'receipt of such notice by Sub - recipient.
Notwithstanding the preceding, the City reserves any and all legal rights and
remedies it may have with regard to recapture of all or any portion of the Funds,
or any assets acquired or improved in whole or in part with said Funds.
12.2 Termination for Cause: Notwithstanding Subsection 12.1 above, the City may
also terminate this Agreement for cause. ".Cause" shall include, but not be limited
to the following:
a. failure to comply and /or perform, in accordance with the terms of this
Agreement, or any Federal, State, County or City law, or regulation.
b. Submitting reports to the City which are late, incorrect, or incomplete in any
material respect.
C. Implementation of this Agreement, for any reason, is rendered impossible or
infeasible.
d. Failure to respond in writing to any concerns raised by the City, including
substantiating documents when required /requested by the City.
e. Any evidence of fraud, mismanagement, and /or waste, as determined by the
City's monitoring and applicable HUD rules and regulations.
The City shall notify the Sub - recipient in writing when the Sub - recipient has been
placed in default. Such notification shall include: (i) actions taken by or to be taken
by the City, such as withholding of payments; (ii) actions to be taken by the Sub-
recipient as a condition precedent to curing the default; and (iii) a reasonable cure
period, which shall be no less than thirty (30) days from notification date. In the
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event the Sub - recipient fails to cure such default within the aforestated cure period,
this Agreement shall be considered terminated for cause, without requiring further
notice to Sub - recipient, and Sub- recipient shall be solely responsible for repayment
to the City of all or any portion of the Funds disbursed to Sub - recipient, as deemed
required by the City, in its sole and reasonable discretion. Said monies shall be
immediately due and payable by Sub - recipient. Notwithstanding the preceding, the
City, reserves any and all legal rights and remedies it may have with regard to
recapture of all or any portion of the Funds, or any assets acquired or improved in
whole or in part with said Funds.
12.3 Termination for. Lack.of Funds: In the event of curtailment of, or regulatory
constraints placed on the Funds by HUD, this Agreement will terminate, effective .
as of the time that it is determined by the City Manager that such Funds are no
longer available. Costs of the Sub - recipient incurred after termination are not
allowable unless expressly authorized in writing by the City Manager (whether in
the notice of termination or subsequent thereto), and, in that case, may only be
allowable if, in the sole discretion of the City Manager:
a. The costs resulted from obligations which were properly incurred before the
effective date of termination, were not in anticipation of it, and are
noncancelable; and
b. The costs would be allowable if the Agreement expired normally at the end
of its Term.
Section 13. Equal Employment Opportunities: The Sub - recipient shall comply with equal
employment opportunities as stated in Executive Order 11246, entitled "Equal
Employment Opportunity" as amended Executive Order 11375, and as supplemented in
Department of Labor regulations.
Section 14. Program income: The Sub - recipient, or any City approved successor in interest thereto,
including without limitation, a 'limited liability company who has taken title to the Property,
shall submit yearly independent audits regarding Program Income (as such term is
defined under applicable Federal . regulations) to the City. The cost of the yearly
independent audits shall be paid by the entity from its operating expenses. Any remaining
Program Income shall be returned to the City and utilized for NSP3 activities.
Section 15. Religious Organization or Owned Property: NSP3 funds may be used by religious
organizations or on property owned by religious organizations only with prior written
approval from the City Manager, and only in accordance -with requirements set in 24 CFR
§570.2000).. The Sub - recipient shall comply with First Amendment Church /State
principles, as follows:
a. It will not discriminate against any employee or applicant for employment on the basis
of religion and will not limit employment or give preference in employment to persons
on the basis of religion.
b. It will not discriminate against any person applying for public services on the basis of
religion and will not limit such services or give preference to persons on the basis of
religion.
c. It will retain its independence from Federal, State, and local governments, and may
continue to carry out its mission, including the definition, practice, and expression of
its religious beliefs, provided that it does not use direct NSP3 funds to support any
inherently religious activities, such as worship, religious instruction, or proselytizing.
d. The Funds shall not be used for the acquisition, construction, or rehabilitation of
structures to the extent that those structures are used for inherently religious activities.
Where a structure is used for both eligible and inherently religious activities, NSP3
funds may not exceed the cost of those portions of the acquisition, construction, or
rehabilitation that are attributable to eligible activities in accordance with the cost
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accounting requirements applicable to NSP3 funds in this part. Sanctuaries, chapels,
or other rooms that a NSP3- funded religious congregation uses as its principal place
of worship, however, are ineligible for NSP3- funded improvements.
Section 16. Reversion of Assets: In the event of a termination of this Agreement, or upon expiration
of the Agreement, and in addition to any and all other remedies available to the City
(whether under this Agreement, or at law or in equity), the Sub - recipient shall immediately
transfer to the City any Funds on hand at the time of termination (or expiration) and any
accounts receivable attributable to the use of Funds. The City's receipt of any Funds on
hand at the time of termination, shall not waive the City's right (nor excuse Sub - recipient's
obligation) to recoup all or any portion of the Funds, as the City may deem necessary.
Any real property under the Sub - recipient's control that was acquired or improved in whole
or in part with NSP3 funds (including NSP3 funds provided to the Sub - recipient in the form
of a loan) in excess of $25,000 must either:
a. Be used to meet one of the national objectives in 24 CFR 570.208 (formerly
section 570.901) until five years after expiration of the term of this Agreement, or
for such longer period of time as determined to be appropriate by the City and as
memorialized by the City and Sub- recipient in an amendment to this Agreement or
such instrument as the City, at its discretion, determines appropriate; or
b. If not used in accordance with the above subsection (a), the Sub - recipient shall
pay to the City an amount equal to the current market value of the property less
any portion of the value attributable to expenditures of non -NSP3 funds for the
acquisition of, or improvement to, the property. No payment shall be required
after the compliance with the affordability requirement for the period of time
specified in subsection (a).
Section 17. Conformity to HUD regulations: The Sub - recipient agrees to abide by guidelines set
forth by HUD for the administration and implementation of the NSP3 Program, including
applicable Uniform Administrative Requirements set forth in 24 CFR 570.502, and
applicable federal laws and regulations in 24 CFR 570.600, et seq. In this regard, the
{ Sub- recipient agrees that duly authorized representatives of HUD shall have access to
any books, documents, papers and records of the Sub- recipient that are directly pertinent
to this Agreement for the purpose of making audits, examinations, excerpts and
transcriptions. The Sub - recipient shall comply with the requirements and standards of
OMB Circular No. A -122, "Cost Principles for Non - profit Organizations ", or OMB Circular
No. A -21, "Cost Principles for Educational Institutions" as applicable. The Sub - recipient
shall comply with the following provisions of the Uniform Administrative requirements of
OMB Circular A -110 (implemented at 24 CFR Part 84, "Uniform Administrative
Requirements for Grants and Agreements With Institutions of Higher Education, Hospitals,
and Other Non - Profit Organizations ") or the related NSP3 provision, as specified in this
section:
a. Subpart A - "General'';
b. Subpart B - "Pre -Award Requirements ", except for 084.12, "Forms for Applying
for Federal Assistance";
C. Subpart C - "Post -Award Requirements ", except for:
(1) Section 84.22, "Payment Requirements" - Grantees shall follow the standards
of ❑❑ 85.20(b)(7) and 85.21 in making payments to sub - recipients;
(2) Section 84.23, "Cost Sharing and Matching ";
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(3) Section 84.24, "Program Income" - In lieu of ❑ 84.24, NSP3 sub - recipients
shall follow ❑ 570.504;
(4) Section 84.25, "Revision of Budget and Program Plans';
(5) Section 84.32, "Real Property" - in lieu of ❑84.32, NSP3 sub - recipients shall
follow ❑ 570.505;
(6) Section 84.34(g), "Equipment" - In lieu of the disposition provisions of ❑
84.34(g), the following applies:
a. In all cases in which equipment is sold, the proceeds shall be program
income (pro -rated to reflect the extent to which NSP3 funds were used to
acquire the equipment); and
b. Equipment not needed by the sub - recipient for NSP3 activities shall be
transferred to the recipient for the NSP3 program or shall be retained after
compensating the recipient;
(7) Section 84.51(b), (c), (d), (e), (f), ,(g), and (h), "Monitoring and Reporting
Program Performance ";
(8) Section 84.52, "Financial Reporting';
(9) Section 84.53(b), "Retention and access requirements for records ". Section
84.53(b) applies with the following exceptions:
a. The retention period referenced in ❑ 84.53(b) pertaining to individual
NSP3 activities shall be four years; and
b. The retention period starts from the date of submission of the annual
performance and evaluation report, as prescribed in 24 CFR 91.520, in
which the specific activity is reported on for the final time rather than from
the date of submission of the final expenditure report for the award;
(10) Section 84.61, "Termination" - In lieu of the provisions of ❑ 84.61, NSP3
subrecipients shall comply with ❑ 570.503(b)(7); and
d. Subpart D "After- the -Award Requirements" - except for ❑ 84.71, "Closeout
Procedures ".
Section 18. Sponsorships: The Sub - recipient agrees that all notices, informational pamphlets, press
releases, advertisements, descriptions of the sponsorship of the Program, research
reports, and similar public notices prepared and released by the Sub - recipient for, on
behalf of, and /or about the Project, shall include the statement:
"FUNDED BY THE CITY OF MIAMI BEACH NEIGHBORHOOD
STABILIZATION PROGRAM 3"
In written materials, the words
"CITY OF MIAMI BEACH NEIGHBORHOOD STABILIZATION PROGRAM 3
FUNDS ADMINISTERED BY THE CITY OF MIAMI BEACH OFFICE OF
REAL ESTATE HOUSING AND COMMUNITY DEVELOPMENT
DEPARTMENT"
shall appear in the same size letters or type as the name of the Sub - recipient.
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Section 19. Examination of Records: The Sub - recipient shall maintain sufficient records in
accordance with 24 CFR 570.502 and 570.506 to determine compliance with the
requirements of this Agreement, the NSP3 Program, and all other applicable laws and
regulations. This documentation shall include, but not be limited to, the following:
a. Books, records and documents in accordance with generally accepted accounting
principles, procedures and practices, which sufficiently and properly, reflect all
revenues and expenditures of funds provided directly or indirectly by this
Agreement, including matching funds and Program Income. These records shall
be maintained to the extent of such detail as will properly reflect all net costs,
direct and indirect labor, materials, equipment, supplies and services, and other
costs and expenses of whatever nature for which reimbursement is claimed under
the provisions of this Agreement.
b. Time sheets for split- funded employees, which work on more than one activity, in
order to record the NSP3 activity delivery cost by Project and the non -NSP3
related charges.
C. How the Statutory National Objective(s) as defined in 24 CFR 570.208 and the
eligibility requirement(s) under which funding has been received, have been met.
These also include special requirements such as necessary and appropriate
determinations as defined in 24 CFR 570.209, income certifications, and written
Agreements with beneficiaries, where applicable.
The.Sub- recipient is responsible for maintaining and storing all records pertinent to this
Agreement in an orderly fashion in a readily accessible, permanent and secured location
for a period of four (4) years after expiration of this Agreement, with the following
exception: if any litigation, claim or audit is started before the expiration date of the four (4)
year period, the records will be maintained until all litigation, claims or audit findings
involving these records are resolved. The City shall be informed in writing after closeout of
this Agreement, of the address where the records are to be kept.
Section 20. Audits and Inspections: At any time during normal business hours, and as often as the
City (and /or its representatives) may deem necessary, the Sub - recipient shall make
available all records, documentation, and any other data relating to all matters covered by
the Agreement, for review, inspection or audit.
Audits shall be conducted annually and shall be submitted to the City 180 days after the
end of the Sub - recipient's fiscal year. The Sub - recipient shall comply with the
requirements and standards of OMB A -133, "Audits of Institutions of High Education and
Other Non - Profit Institutions" (as set forth in 24 CFR Part 45), or OMB Circular A -128,
"Audits of State and Local Governments" (as set forth in 24 CFR Part 44), as applicable.
If this Agreement is closed -out prior to the receipt of an audit report, the City reserves the
right to recover any disallowed costs identified in an audit after such closeout.
Section 21. Indemnification /Insurance Requirements: The Sub - recipient shall indemnify and hold
harmless the City, its officers, employees and agents, from any and all claims, liability,
losses and causes of action which may arise out of an act, omission, negligence or
misconduct on the part of the Sub - recipient, or any of its agents, officers, servants,
employees, contractors, patrons, guests, clients, licensees, invitees, or any persons acting
under the direction, control, or supervision of Sub - recipient, pursuant to this Agreement
and /or the Project. The Sub - recipient shall pay all claims and losses of any nature
whatsoever in connection therewith and shall defend all suits in the name of the City, and
shall pay all costs (including attorney's fees) and judgements which may issue thereon.
This Indemnification shall survive the termination and /or expiration of this Agreement.
The Sub - recipient shall not commence any work and /or services pursuant to this
Agreement until all insurance required under this Section has been obtained and the City's
Risk Manager has approved such insurance. In the event evidence of such insurance is
not forwarded to the City's Risk Manager within thirty (30) days after the commencement
date of the Term, this Agreement shall automatically terminate and become null and void,
and the City shall have no obligation under the terms and conditions hereof.
The Sub - recipient shall maintain and carry in full force during the Term of this Agreement,
and /or throughout the duration of the Project contemplated herein, whichever is longer,
the following insurance:
a. General Liability Policy with coverage for Bodily Injury and Property Damage, in
the amount of $1,000,000 single limit, subject to adjustment for inflation. The
policy must include coverage for contractual liability to cover the above
indemnification.
b. Worker's Compensation and Employers Liability, as required pursuant to Florida
Statutes.
C. Automobile and vehicle coverage shall be required when the use of automobiles
and other vehicles are involved in any way in the performance of the Agreement.
Limits for such coverage shall be in the amount of $500,000, subject to
adjustment for inflation.
The City of Miami Beach shall be named as an additional insured under all such insurance
contracts. Thirty- (30) day written notice of cancellation or substantial modification of the
insurance coverage must be given to the City's Risk Manager by the Sub - recipient and its
insurance company. The insurance must be furnished by insurance companies
authorized to do business in the State of Florida, and approved by the City's Risk
Manager. The companies must be rated no less than "B +" as to management, and not
less than "Class VI" as to strength by the latest edition of Best's Insurance Guide,
published by A.M. Best Company, Oldwick, New Jersey, or its equivalent, subject to the
approval of the City's Risk Manager. Original Certificates of Insurance for the above
coverage must be submitted to the City's Risk Manager for approval prior to any work
commencing. These certificates will be kept on file in the Office of the Risk Manager,
Third Floor City Hall.
The City shall have the right to obtain from the Sub - recipient specimen copies of the
insurance policies, in the event that submitted Certificates of Insurance are inadequate to
ascertain compliance with required coverage. Compliance with the foregoing
requirements shall not relieve the Sub - recipient of its obligation to indemnify and hold the
City harmless, as required in this section.
Section 22. Conflict of Interest: The Sub - recipient covenants that no person under its employ who
presently exercises any functions or responsibilities in connection with community
development funded activities has any personal financial interests, direct or indirect, in this
Agreement. The Sub - recipient covenants that in the performance of this Agreement, no
person having such conflicting interest shall be employed. The Sub- recipient covenants
that it will comply with all provisions of 24 CFR 570.611 "Conflict of Interest ", and the,
State, County and.City of Miami Beach statutes, regulations, ordinances or resolutions
governing conflicts of interest. The Sub - recipient shall disclose, in writing, to the City any
possible conflicting interest or apparent impropriety that is covered by the above
provisions. This disclosure shall occur immediately upon knowledge of such possible
conflict. The City will then render an opinion, which shall be binding on both parties.
Section 23. Venue: This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Florida, both substantive and remedial, without regard to principles of
conflict of laws. The exclusive venue for any litigation arising out of this Agreement shall
be Miami -Dade County, Florida, if in state court, and the U.S. District Court, Southern
District of Florida, if in federal court. BY ENTERING INTO THIS AGREEMENT, CITY
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AND SUB- RECIPIENT EXPRESSLY WAIVE ANY RIGHTS EITHER PARTY MAY HAVE
TO A TRIAL BY JURY OF ANY CIVIL LITIGATION RELATED TO, OR ARISING OUT OF,
THIS AGREEMENT.
Section 24. Notices: All notices required under this Agreement shall be sent to the parties at the
following address:
City: Anna Parekh, Director
Office of Real Estate, Housing and Community Development
City of Miami Beach
1700 Convention Center Drive, Miami Beach, FL 33139
Sub- recipient: Roberto Datorre, President
Miami Beach Community Development Corporation
945 Pennsylvania Avenue
Miami Beach, FL 33139
Section 25. Limitation of Liability: The City desires to enter into this Agreement only if in so doing
the City can place a limit on City's liability for any cause of action for money damages due
to an alleged 'breach by the City of this Agreement, so that its liability for any such breach
never exceeds the sum of $10,000. Sub - recipient hereby expresses its willingness to
enter into this Agreement with Sub - recipient's recovery from the City for any damage
action for breach of contract to be limited to a maximum amount of $10,000.
Accordingly, Sub - recipient hereby agrees that the City shall not be liable to Sub - recipient
for damages in an amount in excess of $10,000, for any action or claim for breach of
contract arising out of the performance or nonperformance of any obligations imposed
upon the City by this Agreement. Nothing contained in this subparagraph or elsewhere in
this Agreement is in any way intended to be a waiver of the limitation placed upon City's
liability as set forth in Florida Statutes, Section 768.28.
Section 26. Developer Fee: Per HUD Guidance on Developers, Sub - recipients, and Contractors,
dated August 27, 2010, (Attachment V) sub - recipients many not earn a developer's fee.
The Sub - recipient was not publicly procured therefore Sub - recipient is not classified as a
Developer and may not collect any NSP3 funds for Developer fees.
Section 27. Retainage: The City shall retain 10% from all draws paid pursuant to payment
reimbursement requests from Sub - recipient.
Section 28. Cancelled Check Documentation: Sub - recipient shall submit copies of cancelled checks
with all payment reimbursement requests, as a condition to, and prior to receiving
payment from the City.
Section 29. This Agreement shall be binding upon all parties hereto and their respective heirs,
executors, administrators, successors and assigns.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized officials on the day and date first above indicated.
MIAMI BEACH COMMUNITY DEVELOPMENT CORPORATION
a Florida not - for - profit corporation
ATTEST:
�ec a ary Signatu
Roberto Datorre, President
Pr nt :Name Print Name and Title
CITY OF MIAMI BEACH
a Florida Municipal corporation
ATTEST:
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Rafa. Granado City �P \v ` .. ......
F: \RHCD \$ALL \HSG- CD\ALL \NSP 3 \MBC � C\NSPI��C t v dqt
26'
APPROVED AS TO
FORM & LANGUAGE
4 1& LFOR CUTION
me� r Date
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ATTACHMENT I
LONDON HOUSE APARTMENTS PHASE I — PROJECT NARRATIVE
1965 NVASHINGTON ANNE
The London House Apartments, a contributing structure in the National Register Miami
Beach Architectural District located at 1965 — 1975 Washington Avenue the structure is
situated in the Museum Historic District, it was built in 1948 as a two and three- story,
Miami Modern apartment hotel building it was designed by Robert M. Little. The
Building now serves as a rental apartment building with 8 studio apartments and 2 one
bedroom apartments, MBCDC has retained Architecture Works to redesign the building
and reduce the density to 6 larger units in a combination of studios and 3- bedroom
apartments. When finished The London House Apartments Phase 1 will have 6 units that
will serve low - income work force household families meeting the national and local
objective of providing larger housing units to serve low income households.
The building was purchased by Miami ,Beach Community Development Corporation in
2007 with funds from the City of Miami Beach Redevelopment Agency. Rehabilitation
of the London House Phase 1 will include the exterior rehabilitation of the original
historic elements, such as the facade, the complete ground level terrace with ornaments,
the second and third -floor open walkways and new exterior windows and doors. 'A
significant aspect of the renovation includes the effort to provide one, two and, three .
bedroom apartments to serve low income families. The complete interior rehabilitation
includes new HNAC systems, electrical and plumbing systems. Structural rehabilitation
will also be part of the scope of work for this project including concrete work at tie-
beams and columns and new framing where needed also a new roof system will be
installed and the whole structure will be retrofitted to meet the protocol for high velocity
hurricane zones as described in the South Florida Building Code. These units will provide
affordable housing to low - income families of Miami Beach.
The sidewalk areas and outdoor recreation areas will be constructed so that manual- and
powered wheelchairs can navigate them easily and encourage residents to venture out
into their neighborhood. The project will promote both energy efficiency and
construction efficiency. Additionally, the project will use insulated window glazing and
gas hydronic heat to further promote conservation. All exterior walls and ceilings will be
insulated to meet or exceed code requirements and interior tenant separation walls will
receive sound insulation. Other areas in which energy conscious design features will be _
implemented are: water closets at all toilets will be 1.6 gallon fixtures. The faucets will
have built -in flow restrictors to lower water consumption. All of the appliances Nvill be of
an energy savings type as well. Energy efficient light fixtures and corresponding bulbs
will be used as much as possible as well as energy efficient appliances.
ATTACHMENT ENT [!
I MBCDC:.LONDON HOUSE APARTMENTS - LIME ITEM BUDGET 01/07/2011
BUDGET PHASE 1 PHASE 2
SOURCES 4,794,389.00
USES TOTAL 1965 WASHINGTON 1975 WASHINGTON
SOFT COSTS
ACQUISITION CLOSING COSTS 21,852.00 0.00 21,852.00
OTHER CLOSING COSTS 5,000.00 5,000.00 0.00 <
CONSTRUCTION INTEREST 70,000.00 0.00 70,000.00
INSPECTION FEES 10,000.00 3,500.00 6,500.00
APPRAISAL 2,500.00 875.00 1,625.00
SURVEY 400.00 200.00 200.00
ARCHITECTURAL FEES 120,000.00 40,000.001 80,000.00
ARCHITECTURAL FEES RE DESIGN 50,000.00 30,000.00 20,000.00
ENGINEERING 3,000.00 1,000.00 2,000.00
ENVIROMENTAL 10,000.00 5,000.00 5,000.00
INSURANCE BUILDER'S RISK 50,000.00 17,500.00 32,500.00
LEGAL EXPENSES 3,000.00 1,000.00 2,000.00
PERMITS FEE 10,000.00 3,500.00 6,500.00
PROPERTY TAXES 61,181.00 21,413.00 39,768.00
EXTERMINATING 1,200.00 0.00 1,200.00
SITE UTILITIES 15,000.00 5,000.00 10,000.00
CONTINGENCIES 16,000.00 16,000.00 0.00
CONSULTING 6,000.00 2,000.00 4,000.00
DEV. FEES & PROJECT MANAGEMENT 573,181.00 25,482.00 547,699.00
TOTAL SOFT COSTS 1,028,314.00 177,470.00 850,844.00
HARD COSTS
GENERAL COND. SUPERINTENDENT 96,000.00 33,600.00 62,400.00
GENERAL COND. PROJECT MANAGER 65,000.00 22,750.00 42,250.00
GENERAL LABOR 35,000.00 12,250.00 22,750.00
TELEPHONE 2,400.00 840.00 1,560.00
TEMPORARY POWER / UTILITIES 3,200.00 1,120.00 2,080.00
SMALL TOOLS 3,500.00 1,225.00 2,275.00
WATER & ICE 1,040.00 364.00 676.00
MOBILIZATION & SET UP 4,500.00 1,575.00 2,925.00
TRUCK & AUTO ALLOWANCE 9,100.00 3,185.00 5,915.00
PERFORMANCE BOND 60,000.00 21,000.00 39,000.00
BLUE PRINTS REPRODUCTIONS 700.00 245.00 455.00
CLEANING FINAL CLEANING 6,500.00 2,275.00 4,225.00
DUMPSTERS 14,000.00 5,000.00 9,000.00.
QUALITY CONTROL PUNCH LIST 3,500.00 1,225.00 2,275.00
TEMPORARY TOILETS 1,350.00 472.50 877.50
THRESHOLD INSPECTOR 15,000.00 7,000.00 8,000.00
MATERIAL TESTING 2,500.00 875.00 1,625.00
)OBSITE SIGN 650.00 0.00 650.00
MAIN OFFICE COURIER SERVICE 400.00 140.00 260.00
OSHA REQUIEREMENTS 3,750.00 1,750.00 2,000.00
SELECTIVE DEMOLITION 29,500.00 10,325.00 19,175.00
FINAL GRADING 2,650.00 927.50 1,722.50
COMPACTION & SOIL DENSITY TEST 2,950.00 1,032.50 1,917.50
TERMITE CONTROL SOIL PREP 1,700.00 595.00 1,105.00
HELICAL PILES 0.00 0,00 0.00
WATER FIRE LINE 15,500.00 6,500.00 9,000.00
WATER NEW 2" SERVICE 6,750.00 2,750.00 4,000.00
FENCES & GATES 9,000.00 3,000.00 6,000.00
IRRIGATION 4,950.00 1,950.00 3,000.00
LANDSCAPING 15,500.00 5,500.00 10,000,00
CONCRETE CELLS 25,000.00 10,000.00 15,000.00
PRECAST CONCRETE 2,250.00 500.00 1,750.00
GUNITE RESTORATION 39,900.00 19,900.00 20,000.00
CONCRETE FLOORING (GYPCRETE) 37,400.00 13,090.00 24,310.00
V STRUCTURAL STEEL 17,200.00 6,020.00 11,180.00
ELANEOUS STEEL GUARDRAILS 28,000.00 20,000.00 8,000.00
NGS 15,000.00 5,000.00 10,000.00
H CARPENTRY 200,000.00 90,000.00 110,000.00
TRIM CARPENTRY 8,750.00 3,062.50 5,687.50
CABINETRY / VANITIES 55,500.00 20,000.00 35,500.00
WATERPROOFING CAULKING 4,500.00 1,500.00 3,000.00
ROOFING 103,000.00 26,000.00 77,000.00
METAL DOORS & FRAMES 6,580.00 2,580.00 4,000.00
WOOD DOORS & FRAMES 8,000.00 2,000.00 6,OD0.00
ENTRANCE DOORS 5,000.00 3,000.00 2,000.00
WINDOWS 155,000.00 52,000.00 103,000.00
ROOF HATCH 980.00 0.00 980.00
HARDWARE 12,700.00 3,700.00 9,000.00 "
MIRRORS / MEDICINE CABINETS 4,000.00 1,000.00 3,000.00
STUCCO & MOLDINGS 50,000.00 20,000.00 30,000.00
GYPSUM WALLBOARD SYSTEMS 242,000.00 95,000.00 147,000.00
FIRE RATING 16,000.00 6,000.00 10,000.00
CERAMIC TILE AT BATHROOMS 22,000.00 4,500.00 17,500.00
CERAMIC TILE AT LIVING AREAS 160,000.00 70,000.00 90,000.00
WINDOW SILLS 16,000.00 6,000.00 10,000.00
BASEBOARDS 27,000.00 7,000.00 20,000.00
PAINTING 30,000.00 8,000.00 22,000.00
SIGNAGE 500.001 150.00 350.00
MAILBOXES 750.00 0.00 750.00
CLOSET WIRE SHELVING 4,500.00 1,500.00 3,000.00
TOILET ACCES. (ADA BATHROOMS) 3,200.00 1,200.00 2,000.00
TOILET ACCES. (STANDARD) 8,000.00 1,000.00 7,000.00
RENTAL EQUIPMENT 62,050.00 21,717.50 40,332.50
KITCHEN APPLIANCES 80,000.00 20,000.00 60,000.00
ELEVATOR 169,000.00 0,00 169,000.00
FIRE PROTECTION / SPRINKLERS 165,000.00 57,750.00 107,250.00
PLUMBING 250,000.00 100,000.00 150,000.00
FIRE EXTINGUISHERS 1,430.00 430.00 1,000.00
H/VAC 188,000.00 37,600.00 150,400.00
ELECTRICAL 298,000.00 104,300.00 193,700.00
FIRE ALARM SYSTEM 110,000.00 38,500.00 71,500.00
LIABILITY INSURANCE 3,810.98 1,810.98 .2,000.02
CONTRACTOR'S OVERHEAD 204,878.00 71,707.30 133,170.70
CONTRACTOR'S FEE 128,606.02 45,012.10 83,593.90
SUB TOTAL HARD COSTS 3,386,075.00 1,148,001.88 2,238,073.12
Contingency 380,000.00 280,000.00 100,000.00
TOTAL HARD COSTS 3,766,075.00 1,428,001.88 2,338,073.12
TOTAL DEVELOPMENT COSTS 4,794,389.00,
TOTALS / PHASE s ._ 1,505,471.88 3,188,917.12 .
SOURCES AMOUNT PHASE 1 PHASE 2
OCED CDBG RFA 2009 408,482.00 175,300.00 233,182.00
CITY OF MIAMI BEACH RDA 102,582.00 0.00 102,582.00
US HUD EDI 431,600.00 102,592.88. 329,007.12
CMB HOME 11/12 934,064.00 0.00 934,064.00
NSP 3 1,327,579.00 1,327,579.00 0.00
HISTORIC TAX CREDIT 950,000.00 0.00 950,000.00
COUNTY G.O. BONDS 400,000.00 0.00 400,000.00
BANK 240,082.001 0.001 240,082.00
TOTAL SOURCES 4,794,389.00 1,605,471.88 3,188,917.12
NOTES:
PHASE 1 CONSTRUCTION TIME 12 MONTHS (48 WEEKS) FUNDS SECURED AFTER NSP APP.
PHASE 2 CONSTRUCTION 16 MONTHS (64 WEEKS) AFTER SECURING FUNDING
ATTACHMENT I I I
FUNDING APPRO1 GRANT AGREEML4 NT FOR
NEIGHBORHOOD STABILIZATION PROGRAM 3 (NSP3) FUNDS
AS AUTHORIZED AND APPROPRIATED UNDER THE WALL STREET
REFORM AND CONSU112ER PROTECTION ACT OF 2010, AMERICAN
RECOVERY Al\TD REINVESTMENT ACT OF 2009 AND THE HOUSING
AND ECONOMIC RECOVERY ACT OF 2008
(PUBLIC LANITS 111 - 203,111 -005 and 110 -289)
NSP3 GRANTEE: Miami Beach
NSP3 GRANT NUMBER: B- 11- 1\INT -12 -0039
NSP3 GRANT AMOUNT: $1,475,088.00
NSP3 APPROVAL DATE: 3 -8 -2011
NSP3 EXPENDITURE DEADLINE (2 YEAR): 3 -8 -2013
NSP3 EXPENDITURE DEADLINE (3 YEAR): 3 -8 -2014
GRANTEE DUNS NUMBER: 020546289
1. This Grant Agreement between the U.S. Department of Housing and Urban Development
(HUD) and the city of Miami Beach (Grantee) is made pursuant to the authority of
section 1497 of the Wall Street Reform and Consumer Protection Act of 2010 (Pub. L.
111 -203 (July 21, 2010)) (Dodd -Frank Act), title X1I of Division A of the American
Recovery and Reinvestment Act of 2009 (Public Law 111 -5 (February 17, 2009))
(Recovery Act) and sections 2301 — 2304 of the Housing and Economic Recovery Act of
2008 (Public Law 110 -289 (July 30, 2008)) (HERA). The program established pursuant
to section 2301 -2304 of HERA is known as the "Neighborhood Stabilization Program" or
"NSP." The term "NSP2" refers to the second appropriation of NSP funds provided
under the Recovery Act. The additional allocation under the Frank Dodd Act represents
the thud round of Neighborhood Stabilization Program funding and is referred to as
"NSP3." Notice of Formula Allocations and Program Requirements for Neighborhood
Stabilization Program Formula Grants (Docket No. FR- 5447 -N -01, October 19, 2010)
(NSP3 Notice); the Dodd -Frank Act; the Recovery Act; HERA; the Grantee's
application for NSP3; the HUD regulations at 24 CFR Part 570 (as modified by the NSP3
Notice as now in effect and as may be amended from time to time) (Regulations); and
this Funding Approval, including any special conditions, constitute part of the Grant
Agreement. .In.the event of a conflict between a provision of the Grantee's Application
and any provision of this Grant Agreement, the latter shall control.
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2. The Grantee shall comply with reporting requirements established by HUD and OMB
j(including all revisions to such reporthig requirements) and the Federal Funding
Accountability and Transparency Act (Pub. L. 109 -282) (including implementing
guidance).
3. Subject to the provisions of this Grant Agreement, HUD will make NSP3 Grant Funds in
the amount of $1,475,088 available to the Grantee upon execution of this Grant
Agreement by the parties. Of that amount, $368,772 must be used to house individuals
or families whose incomes do not exceed 50 percent of area median income. pursuant to
Dodd -Frank Act. The Grantee shall have 24 months from the date of HUD's execution
of this Grant Agreement to expend half of the NSP3 Grant amount pursuant to the
requirements of this Agreement, the Dodd -Frank Act, the Recovery Act, HERA and the
NSP3 Notice, as amended. The Grantee shall have 36 months from the date of HUD's
execution of this Grant Agreement to expend the total NSP3 Grant amount pursuant to
the requirements of this Agreement, the Dodd -Frank Act, the Recovery Act, HERA and
the NSP3 Notice, as amended. The NSP3 Grant Funds may be used to pay eligible costs
I
arising from eligible uses incurred after the NSP3 Approval Date provided the activities
to which such costs are related are carried out in compliance with all applicable
requirements. Pre -award planning and general administrative costs may not be paid with
• funding assistance except as permitted in the NSP3 Notice, as amended. 'Other pre -award .
costs may not be paid with funding assistance except as permitted by 24 CFR 570.200(h);
for purposes of NSP3, such costs are limited to those incurred on or after the date that the
NSP3 Notice was published by HUD.
4. The Grantee agrees to assume all of the responsibilities for environmental review,
decisionmaking, and actions, as specified and required in regulations issued by the
Secretary pursuant to section 104(g) of Title I of the Housing and Community
Development Act, as amended (42 U.S.C..5304) and published in 24 CFR Part 58.
{
5. The Grantee agrees that it will demolish or convent units using NSP3 funds only to the
j extent and scope described in the NSP3 substantial amendment. The Grantee agrees that
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under no circumstances will NSP3 funds be used to demolish any public housing (as
defined in section 3 of the United States Housing Act of 1937 (42 U.S.C. 1437a)).
6. The Grantee agrees to comply with the Recovery Act provisions concenling ..tenant
protections applicable to NSP3 acquisitions of foreclosed property. The Grantee must
document its efforts to ensure that the initial successor in interest (ISII) in a foreclosed
upon dwelling or residential real property (typically, the initial successor in interest in
property acquired through foreclosure is the lender or trustee for holders of obligations
secured by mortgage liens) has provided bona fide tenants with the notice and other
protections outlined in the Recovery Act. The Grantee will not use NSP3 funds to
finance the acquisition of property from any initial successor in interest that failed to
comply with applicable requirements unless the Grantee assumes the obligations of such
initial successor in interest with respect to bona fide tenants. If the Grantee elects to
assume such obligations, it may only do so if the tenant is still occupying the property
and will provide any tenant displaced as a result of the NSP3 funded acquisition with the
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assistance outlined in 24 CFR 570.606, If the Grantee knows that the IS11 did not comply
with the NSP tenant protection requirements and vacated the property contrary to the
NSP requirements, NSP3 funds cannot be used to acquire such properties.
7. The Grantee further acknowledges its responsibility for adherence to all applicable terms
and conditions of this grant award by sub- recipient entities and contractors, including .
obtaining a DUNS number (or updating the existing DUNS record), and registering with
the Central Contractor Registration.
8. This Grant Agreement may be amended only with the prior written approval of HUD. In
considering proposed amendments to this Grant Agreement, HUD shall .also review,
among other things, whether the amendment is otherwise consistent with the Dodd -Frank
Act, the Recovery Act, HERA, the NSP3 Notice, as amended, and the Regulations.
j 9. The Grantee may not amend its Grantee Submission other than as described above;
i
however, such amendments will be subject to the requirements of the NSP3 Notice and
{ any revisions HUD may make to the NSP3 Notice (or any successor Notice or
regulation).
10. The Grantee must respond in writing to any citizen complaint within 15 working days, if
feasible, and send a copy of the response to HUD. The Grantee shall at all times maintain
an up -to -date copy of its Grantee Application, including all amendments approved by
HUD, on its Internet website. Further, the Grantee shall maintain information on all
j drawdowns, deposits, and expenditures of grant funds and program income under this
Funding Approval and Grant Agreement and any other records required by 24 CFR
570.506 and the NSP3 Notice, as amended, in its files and shall make such information
available for audit or inspection by duly authorized representatives of HUD, HUD's
Office of the Inspector General, or the Comptroller General of the United States.
11. The Grantee is advised that providing false, fictitious or misleading information with
respect to NSP3 Grant Funds may result in criminal, civil or administrative prosecution
under 18 USC § 1001, 18 USC § 1343, 31 USC § 3729, 31 USC § 3801 or another
applicable statute.
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12. Close -out of this grant shall be subject to the provisions of 24 CFR 570.509 or such
close -out instructions as may hereafter be issued by HUD specifically for NSP3 grants.
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This NSP3 Grant Agreement is binding with respect to HUD in accordance with its terms upon
the execution by HUD in the space provided below, subject to execution on behalf of the
Grantee.
1
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The United States Department of The Grantee
Housing and Urban Development City of I\Iiami Beach
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G
Signature of Authorized Official $i na Ke Au tho
Name of Authorized Official Name of Authorized Official
I
Title of Authorized Official Title of Authorized Official
Date of Signature Date of Signature
Grantee Tax Identification Number
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APPROVED AS TO
FORM & LANGUAGE
FnH EX CUTION
Ci yA tollleW Gate
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ATTACHMENT IV
Program Statutes and Reaula - ions
Fsy sign a of this Agreement, the Contractor hereby certifies that it will. comply with the following applicable federal and
state requirements:
1. Community Development Block Gant, Final Rule, 24 C.F.R., Part 570.602;
2. Florida Small and Minority Business Act, s. 288.702 - 288.714, F.S.;
3. Florida Coastal Zone Protection Act, s. 161.52- 161.58, F.S.;
4. Local Government Comprehensive Planning and Land Development Regulation Act, Ch. 163, F.S.;
5, Title I of the Housing and Community Development Act of 1974, as amended
S. Treasury Circular 1075 regarding drawdown of NSP funds
7. Sections 290.0401- 290.049, F.S.;
8. Rule Chapter 913-76, Fla. Admin. Code.;
9. Department of Community Affairs Technical Memorandums;
10. HUD Circular Memorandums applicable to the Small Cities CDBG Program;
11 Single Audit Act of 1984;
12. National Environmental Policy Act of 1969 and other provisions of law which further the purpose of this Act;
13. National Historic Preservation Act of 1966 (Public LawSM65) as amended and Protection of Historic Properties (24 CFR Part 800);
14. Preservation of Archaeological and Historical Data Act of 19-35;
15. Executive Order. 11593 - Protection and Enhancement of Cultural Environment;
16. Reservoir Salvage Act;
17. Safe Drinking Water Act of 1974, as amended;
18. Endangered Spectres Act of 1958, as amended;
19. Executive Order 12898 - Environmental Justice
20. Executive Order 11988 and 24 CFR Par 55 - Floodptain Management
21. The Federal Water Pollution Control Act of 1972, as amended (33 U.S.C., S. 1251 et- seq.);
22. Executive Order 11990 - Protecti on of Wetlands;
23. Coastal Zone Management Act of 1908, as amended;
24..Vdld and Scenic Rivers Act of 1968, as amended;
25. Clean Air Act of 19T
26. HUD Environmental Standards (24 CFR Part 55);
27. Farmland Protection Policy Act of 1981;
28. Clean Water Act of 1977;
29. Davis - Bacon Wage Rate Act;
30. Contract Wort; Hours and Safety Standards Act of 1962, 40 U.S.C. s. 327 eL sea.;
31. The Wildlife Coordination Act of 1958, as amended;
32. The Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1975 (42 U.S.G., s. 6901 eL seq.);
33. Noise Abatement and Control: Departmental Policy Implementation, Responsibilities and Standards, 24 CFR Par 51, Subpar B,
34. Flood Disaster Protection Act of 1973, P.L. 92 -234;
35. Protection of Historic and Cultural Properties under HUD Programs, 24 CFR Par 59;
36. Coastal Zone Management Act of 1972, P.L. 92 -583;
37. Architectural and Construction Standards;
38. Architectural Barriers Act of 1968, 42 U.S.C. 4151;
39. Executive Order 11296, relating to evaluation of flood hazards;
40. Executive Order 11288, relating to prevention, control and abatement of water pollution;
41. Cost- Effective Energy Conservation Standards, 24 CFR Par 39;
42. Section 8 Existing Housing Quality Standards, 24 CFR Par 882;
43. Coastal Barrier Resource Act of 1982;
44. Federal Fair Labor Standards Act, 29 U.S.C., s. 201 et. seq.;
45. Title VI of the Civil Rights Act of 1964 - Non - discrimination;
46. Title VII of the Civil Rights Act of 1968 - Non - discrimination in housing;
47. Age Discrimination Act of 9975;
48. Executive Order 12892- Fair Housing
49. Section 109 of the Housing and Community Development Act of 1974, Non - discrimination;
50. Section 504 of the Rehabilitation Act of 1973 and 24 CFR Part 8;
51. Executive Order 11063 - Equal Opportunity in Housing;
52. Executive Order 11246 - Non - discrimination;
53. Section 3 of the Housing and Urban Development Act of 1968, as amended - Employment/Training of Lower Income Residents and Local
Business Contracting;
54. Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, P.L., 10D -17, and 49 CFR Part 24;
55. Copeland Anti- Kickback Act of 1934;
56- Hatch Act;
57. Title IV Lead -Based Paint Poisoning Prevention Act (42 U.S.C., s. 1251 et. seq.);
58. OMB Circulars A -87, A -102, A -122, and A -133, as revised;
59. Administrative Requirements for Grants, 24 CFR Part 85;
6D. Section 102 of the Department of Housing and Urban Development Reform Act of. 1989 and 24 CFR Part 12.
61. Title III of Division B of the Housing Recovery and Economic Act of 2008 (HERA), P.L. 110-289.
fit_ Approved State of Florida 2008 Action Plan Substantial Amendment.
63. e eml Register Noti ce Nurnliers 52.55 -N-0'J and 5235 -9-02.
��..�� a lt � g�... •`�`.`' e ��' �
1.
• ATTACHMENT V
Guidance on Developers, Subrecipients, and Contractors ,
QUESTION: What are implications of using different entity types to carry out NSP- funded
activities?
Neighborhood Stabilization Program (NSP) grantees may work with developers, subrecipients,
contractors, or any combination of these entities to implement their programs. However, different sets of
HUD and OMB rules apply to these entities in certain situations. Accordingly, an NSP grantee must
carefully consider the implications of any decision to implement NSP- funded activities through one type.
of entity versus another. HUD has developed the following guidance to clarify the definitions of each of
these entity types, as well as the requirements for NSP grantees which establish relationships with such
entities. This guidance consolidates information that has been addressed in previous NSP policy alerts,
and offers new guidance regarding developer fees based on more recent questions received from NSP
grantees and affiliates.
Definitions
Subrecipient: A nonprofit or public agency that assists a grantee or another subrecipient to administer all
or a portion of the NSP program. As provided in the NSP Bridge Notice, published on June 19, 2009,
"Subrecipient shall have the same meaning as at the first sentence of 24 CFR 570.500(c). This includes
any nonprofit organization (including a unit of general local government) awarded funds by,a state. The
term also includes any land bank receiving NSP funds from a grantee or another subrecipient." Section
570.500(c) reads as follows: "Subrecipient means a public or private nonprofit agency, authority, or
organization, or a for - profit entity authorized under 570.201(o), receiving CDBG funds-from the recipient
or another subrecipient to undertake activities eligible for such assistance under subpart C of this part."
Developer A for- profit or private nonprofit individual or entity that the grantee provides NSP assistance to
for the purpose of (1) acquiring homes and residential properties to rehabilitate for use or resale for
residential purposes and (2) constructing new housing in connection with the redevelopment of
demolished or vacant properties. Developers are program beneficiaries and thus distinct from
subrecipients, grantee employees, and contractors. Developers may receive NSP funds from either the
grantee or a subrecipient. Developer led rehabilitation is undertaken pursuant to 24 CFR 570.202(b)(1).
New housing construction is undertaken pursuant to 24 CFR 570.204, or the NSP notice published on
October 6, 2008, as amended.
NSP grantees should note that they may but are not required to treat all third -party development entities
as subrecipients. HUD regulations treat developers as private entities entitled to benefit under
570.202(b)(1). This is important in situations where a rip vate for - profit or non - profit organization receiving
NSP funds is neither a contractor nor a subrecipient. In such instances, the developer is not an
intermediary acting for the grantee, but is receiving assistance itself as a beneficiary under the program.
U.S. Department of Housing and Urban Development 1
Office of Block Grant Assistance
2010 -08
s
Examples include a for - profit or nonprofit entity receiving a housing rehabilitation grant or loan to improve
property it owns. Public nonprofits such as Housing Authorities or Redevelopment Authorities do not
qualify as developers because 57O.2O2(b)(1) requires them to be private entities.
Both grantees and subrecipients can engage developers. However, to be treated as a developer, the
entity must demonstrate ownership or control of the property to be rehabilitated or redeveloped. That is,
a grantee or a subrecipient cannot designate an entity as a developer if it is simply providing construction
services on a property owned by the grantee or subrecipient; such an entity would be classified as a
contractor.
Contractor. An entity that supply goods and services at an agreed -upon rate or price. When a grantee or
subrecipient hires a contractor, the contractor must be procured pursuant to Part 84.
Additional Considerations Regarding Developer Fees
Questions pertaining to developer fees are among those most frequently asked by Neighborhood
Stabilization Program (NSP) grantees and affiliates. This section is intended to provide grantees with.a
few additional points to keep in mind as they contemplate entering into agreements with private
developers.
• Grantees and subrecipients may not earn a developer's fee. An entity may charge developer's fees
only under 24 CFR 57O.2O2(b)(1), which allows a grantee to provide CDBG funds (or NSP funds) to
assist in the acquisition and rehabilitation/ reconstruction of property by private individuals or entities.
The right to charge a developer's fee is available only to an entity that receives assistance from the
grantee or the subrecipient and assumes some of the risk of the project which the developer does by
investing some of his /her own money in the project. Grantees and subrecipients are compensated for
the actual costs of carrying out eligible activities, which reduces or eliminates any development risk if
actual costs exceed estimates. Therefore, accounting principles and cost circulars do not allow
grantees or subrecipients to collect a fee. (Note that this is a CDBG policy that has
existed for decades:).
• Public entities having an identity of interest with the grantee may only carry out NSP development
activities for an NSP grantee under a subrecipient agreement, not under a developer agreement
• When negotiating a developer fee, it is crucial for grantees to clearly specify what project costs can
and cannot be paid with NSP fees. For example, if a developer's budget called for directly paying a
project manager and also a developer fee that would be double- dipping and would not be allowed.
Direct costs or indirect costs of a developer related to project management should be paid only
through the fee. Grantees may also require a developer to pay some of the holding costs and receive
reimbursement through the fee. Though not required by NSP, such a provision is used to encourage
developers to complete projects in a timely manner. If a developer agreement does not include
specific property addresses, then the contract should include a detailed list of criteria describing
eligibility for acquisition and include a list of NSP - related obligations that carry forward with the
property. It is also advisable for grantees to retain the right to individually sign off on each acquisition
by a developer.
U.S. Department of Housing and Urban Development 2
Office of Block Grant Assistance
2010 -08
NSP Program Administration Implications by Entity Type
Grantee Developer Subrecipient Contractor
Federal Procurement Yes No Yes N/A
Process? (procured
Revenue /Program Must treat excess Not required to return excess Must treat excess revenues N/A
Income revenues as Program revenues. However, HUD as Program Income and
CFR 570.504 Income, to be used for strongly encourages grantees return to grantee, or if the (Contractors not
other NSP - eligible activities to implement mechanisms grantee wishes, subject to Program
which prevent undue subrecipients may keep Income requirements)
enrichment. program income to
implement other NSP-
eligible activities.
Activity Delivery 10% cap on admin and May receive a developer fee May receive activity delivery All costs built into bid.
and General Program Income; no cap which includes a reasonable costs and admin funds for
Administration on activity delivery costs. profit margin. all direct costs. Bids should
24 CFR 570.205 and Any indirect costs may only incorporate costs and
570.206 May charge contractor fee or be charged to NSP with an expected rate of return.
brokerage fee if performing approved indirect cost
these separate services. allocation plan.
OMB Part 85, A -87 Doesn't have to follow OMB Nonprofits: Public N/A
Cost Principles circulars Part 84, A- Entities: Part
122 85, A -87
Obligations: Funds are obligated when N/A Funds are obligated when N/A
Acquisition there is a purchase there is a purchase
24 CFR 570.201(a) agreement in place for a agreement in place.
g iven property.
Obligations: Funds are obligated when Funds are obligated when a Funds obligated with a Funds are obligated
Rehabilitation there is a written developer's agreement is written agreement with a when rehab contract is
24 CFR 570.202 agreement with a executed and a developer contractor. signed.
contractor in place. provides the grantee a
detailed cost estimate for the
rehab work.
Obligations: Execution of an instrument May not directly provide Execution of an instrument N/A
Homeownership that awards homeownership assistance. that awards homeownership
Assistance homeownership assistance assistance to an individual
570.201(n) to an individual who will who will purchase a property
purchase a property pursuant to NSP eligible use
pursuant to NSP eligible (B) or (E).
use B or (E).
Obligations: Funds are obligated when N/A Funds are obligated when N/A
Demolition there is a contract for there is a contract for
24 CFR 570.201 d demolition activities. demolition activities.
Obligations: Funds are obligated when When developers engage in Funds are obligated when May build a public
Redevelopment; there is a written new residential construction, there is a written agreement facility for a grantee or
Public Facilities / agreement with a the requirements for with a contractor in place. subrecipient.
Improvements contractor in place. acquisition and rehabilitation
24 CFR 570.204, apply.
24 CFR 570.201(c)
Developers may not construct
p ublic facilities.
Housing Total dollar amount of an May not provide housing May perform housing May perform housing
Counseling agreement is obligated counseling, but must ensure counseling directly or counseling for either
24 CFR 570.201(e) when the agreement is that buyers have received 8 through contractor. Total grantee or
executed with a provider of hours of counseling. dollar amount of an subrecipient.
counseling services. agreement is obligated
when agreement is
executed with a counseling
services provider.
Registration for First May register for First Look Nonprofits: For - profit: May register for First Look Must coordinate with
Look Program Allowed? May register Ineligible for grantee /subrecipient to
for First Look First Look access First Look.
U.S. Department of Housing and Urban Development 3
Office of Block Grant Assistance
2010 -08