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HomeMy WebLinkAboutResolution 2026-34164RESOLUTION NO. 2026-34164 A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, APPROVING AND AUTHORIZING THE CITY MANAGER TO: 1) RECAPTURE $153,172.00 OF UNEXPENDED FY 23.24 SHIP FUNDS, PREVIOUSLY ALLOCATED TO THE HOUSING AUTHORITY OF THE CITY OF MIAMI BEACH (HACMB) FOR THE REHABILITATION OF THE LOIS APARTMENTS AND REALLOCATING SAID SHIP FUNDS TO ANOTHER ELIGIBLE HOMEOWNER ACTIVITY PURSUANT TO THE FY 22-25 LOCAL HOUSING ASSISTANCE PLAN (LHAP); 2) RECAPTURE $300,000.00 IN UNEXPENDED FY 20 HOME FUNDS PREVIOUSLY ALLOCATED TO THE HACMB FOR THE REHABILITATION PROJECT LOCATED AT 8411 BOTH STREET AND REALLOCATE THE USE OF SAID FUNDS FOR THE ACQUISITION OF A PROPERTY; 3) REALLOCATE $127,234.03 IN PREVIOUSLY RECAPTURED HOME FUNDS FROM VARIOUS YEARS AND REALLOCATE THE USE OF SAID FUNDS FOR THE ACQUISITION OF A PROPERTY; AND 4) REALLOCATE $6,148.84 IN UNENCUMBERED HOME FUNDS FOR THE ACQUISITION OF A PROPERTY; AND FURTHER, AUTHORIZING THE CITY MANAGER TO SUBMIT THE NECESSSARY DOCUMENTATION TO THE FLORIDA HOUSING FINANCE CORPORATION AND THE REVISED ACTION PLAN TO THE US HOUSING AND URBAN DEVELOPMENT FOR REVIEW AND APPROVAL. WHEREAS, the City is an entitlement recipient of HUD formula grant programs as follows: Community Development Block Grant (CDBG) funds and HOME Investment Partnerships (HOME) funds; and WHEREAS, HOME funds support eligible activities including acquisition, rehabilitation, new construction of affordable housing, tenant -based rental assistance, and related soft costs necessary to expand and preserve housing opportunities for income -eligible households; and WHEREAS, in addition to federal entitlement funding, the City receives state housing funds through the State Housing Initiatives Partnership Program (SHIP), which is administered by the Florida Housing Finance Corporation (FHFC), and governed by the William E. Sadowski Affordable Housing Act and codified in Sections 420.907-420.9079, Florida Statutes; and WHEREAS, together, HOME and SHIP funding provide the City with critical resources to implement acquisition, rehabilitation, homeownership assistance, foreclosure prevention, and preservation strategies; and WHEREAS, both programs impose strict expenditure timelines, regulatory oversight, and compliance standards, requiring active portfolio management, timely recapture of stalled allocations, and strategic reallocation of funds to ensure continued eligibility and programmatic integrity; and WHEREAS, SHIP funds allocated in FY 2023-2024 must be fully expended by June 30, 2026, absent a formal request for a deadline extension and approval by the FHFC; and WHEREAS, City staff routinely monitor project delivery timelines, execute funding agreements, track commitments and expenditures to ensure compliance with the statutory deadline, and initiates internal recapture and reallocation actions to redirect resources to eligible activities that can be timely obligated and expended; and WHEREAS, on October 18, 2023, the Mayor and City Commission adopted Resolution No. 2023-32800, approving the allocation of SHIP FY 23-24 funds in the amount of $153,172.00 for the rehabilitation of the Lois Apartments, an affordable housing property owned by the Housing Authority of the City of Miami Beach (HACMB); and WHEREAS, since the allocation of the $153,172.00 in FY 23-24 SHIP funds to the HACMB for the rehabilitation project, the Administration has undertaken multiple efforts to advance the project within the required program timefreme; and WHEREAS, on February 2, 2026, HACMB staff informed the Administration the project would not be completed within the expenditure deadline of June 30, 2026; and WHEREAS, the Administration has determined that retaining this allocation for the originally proposed project would create unnecessary expenditure risk and potential non- compliance with SHIP statutory deadlines, and seeks to recapture these SHIP FY 23-24 funds and reallocate them to an eligible homeowner assistance strategy pursuant to the adopted Loral Housing Assistance Plan, such as down payment assistance for a very -low-income household, where they can be timely obligated and expended in accordance with SHIP program requirements; and WHEREAS, on May 8, 2019, the Mayor and Commission approved the allocation of FY 19 HOME funds in the amount of $300,000 to the HACMB for the rehabilitation of 841 80' street, a vacant multi -family housing property, via Resolution No. 2019-30812; and WHEREAS, on October 19, 2021, the City and HACMB executed a HOME Program Agreement for the rehabilitation of 841 80'h street, along with a Promissory Note, Mortgage and Declaration of Restrictive Covenants, which expired on September 30, 2023; and WHEREAS, the Administration engaged the HACMB and formally requested updated project documentation; however, the documentation demonstrating substantial progress was not provided and the extension request to the 4-year completion deadline could not be submitted to HUD; and WHEREAS, the $300,000 allocated to HACMB for the rehabilitation project at 841 80th Street has not been expended, and as part of the City's internal fiscal controls and monitoring responsibilities, it is necessary to formally recapture these funds to avoid federal recapture, redirect resources to projects that can be promptly delivered, and support long-term affordable housing goals; and WHEREAS, in connection with the reallocation of the $300,000.00, the City would need to release the recorded Mortgage and Declaration of Restrictive Covenants, which release documents the City Manager would execute pursuant to the City Manager's administrative authority; and WHEREAS, the Office of Housing and Community Services has worked collaboratively with the Finance Department to review HOME funds from prior HOME activities that were de - obligated or closed out, and determined that $127,234.03 remain in a recaptured HOME fund account and can be reallocated to an eligible HOME program activity; and WHEREAS, City staff also identified $6,148.84 in unencumbered HOME funds which can be leveraged as part of a larger acquisition financing structure; and WHEREAS, the Administration recommends reallocating these HOME funds, in the total combined amount of $433,382.87, toward the acquisition of property to expand the City's affordable housing inventory; and WHEREAS, the Administration will ensure that any acquisition activity complies with HOME regulations, including environmental review requirements, underwriting standards, affordability periods, and income eligibility requirements; and WHEREAS, the proposed reallocation of $433,382.87 in available HOME funds would allow the Administration to pursue acquisition of properties, would augment the funds currently available for acquisition and would allow the Administration to initiate its due diligence process of identifying a property that is in good physical condition, and recently renovated or substantially improved; and WHEREAS, the Administration recommends approving the recapture and reallocation of the aforementioned SHIP and HOME funds to ensure timely expenditure of funds, and to support long-term affordable housing goals. NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City Commission hereby approve and authorize the City Manager to: 1) recapture $153,172.00 of unexpended FY 23-24 SHIP funds, previously allocated to the Housing Authority of the City of Miami Beach (HACMB) for the rehabilitation of the Lois Apartments and reallocating said SHIP funds to another eligible homeowner activity pursuant to the FY 22-25 Local Housing Assistance Plan (LHAP); 2) recapture $300,000.00 in unexpended FY 19 HOME Investment Partnership Program funds previously allocated to the HACMB for the rehabilitation project located at 841 80"' street and reallocate the use of said funds for the acquisition of a property; 3) reallocate $127,234.03 in previously recaptured HOME funds from various years and reallocate the use of said funds for the acquisition of a property; and 4) reallocate $6,148.84 in unencumbered HOME funds for the acquisition of a property; and further, authorize the City Manager to submit the necessary documentation to the Florida Housing Finance Corporation and the revised action plan to the US Housing and Urban Development for review and approval. PASSED and ADOPTED day of March, 2026. ATTEST: _ /( Steven Meiner,(9/Mf / b l -NA9 2 0 2026 Rafael E. Granado, City Clerk O'%5EA111 w+� -�fr `Zy 1 [ t.Ilicole OUT, 1ST?; .a f APPROVED AS TO FORM & LANGUAGE & FOR EXECUTION ,, h Dote Resolutions - C7 F MIAMI BEACH COMMISSION MEMORANDUM TO: Honorable Mayor and Members of the City Commission FROM: Eric Carpenter, City Manager DATE: March 18, 2026 TITLE: A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA. APPROVING AND AUTHORIZING THE CITY MANAGER TO: 1) RECAPTURE $153,172.00 OF UNEXPENDED FY 23-24 SHIP FUNDS, PREVIOUSLY ALLOCATED TO THE HOUSING AUTHORITY OF THE CITY OF MIAMI BEACH (HACMB) FOR THE REHABILITATION OF THE LOIS APARTMENTS AND REALLOCATING SAID SHIP FUNDS TO ANOTHER ELIGIBLE HOMEOWNER ACTIVITY PURSUANT TO THE FY 22-25 LOCAL HOUSING ASSISTANCE PLAN (LHAP); 2) RECAPTURE $300,000.00 IN UNEXPENDED FY 20 HOME FUNDS PREVIOUSLY ALLOCATED TOTHE HACMB FOR THE REHABILITATION PROJECT LOCATED AT 841 80TH STREET AND REALLOCATE THE USE OF SAID FUNDS FOR THE ACQUISITION OF A PROPERTY; 3) REALLOCATE $127,234.03 IN PREVIOUSLY RECAPTURED HOME FUNDS FROM VARIOUS YEARS AND REALLOCATE THE USE OF SAID FUNDS FOR THE ACQUISITION OF A PROPERTY; AND 4) REALLOCATE $6,148.84 IN UNENCUMBERED HOME FUNDS FOR THE ACQUISITION OF A PROPERTY; AND FURTHER, AUTHORIZING THE CITY MANAGER TO SUBMIT THE NECESSARY DOCUMENTATION TO THE FLORIDA HOUSING FINANCE CORPORATION AND THE REVISED ACTION PLAN TO THE US HOUSING AND URBAN DEVELOPMENT FOR REVIEW AND APPROVAL. RECOMMENDATION The Administration recommends that the Mayor and City Commission adopt the Resolution authorizing the recapture and reallocation of State Housing Initiative Partnership (SHIP) funds and HOME Investment Partnership (HOME) funds. This recommendation supports long-term affordability, strengthens compliance with HUD requirements, and advances the City Commission's priority of increasing and preserving affordable housing opportunities for Miami Beach residents. BACKGROUNDIHISTORY The City of Miami Beach receives federal housing entitlement funds annually from the U.S. Department of Housing and Urban Development (HUD) as an entitlement jurisdiction. As an entitlement community, the City is allocated formula -based funding directly from HUD to address affordable housing and community development needs, principally through the HOME Investment Partnership Program (HOME). These federal entitlement funds support eligible activities including acquisition, rehabilitation, new construction of affordable housing, tenant -based rental assistance, and related soft costs necessary to expand and preserve housing opportunities for income -eligible households. In addition to federal entitlement funding, the City receives state housing funds through State Housing Initiatives Partnership Program (SHIP), which is administered by the Florida Housing 262 of 1677 Finance Corporation (FHFC). SHIP is governed by the William E. Sadowski Affordable Housing Act and codified in Sections 420.907-420,9079, Florida Statutes. Together, HOME and SHIP funding provide the City with critical resources to implement acquisition, rehabilitation, homeownership assistance, foreclosure prevention, and preservation strategies. However, both programs impose strict expenditure timelines, regulatory oversight, and compliance standards, requiring active portfolio management, timely recapture of stalled allocations, and strategic reallocation of funds to ensure continued eligibility and programmatic integrity. Pursuant to Section 420.9075(3), Florida Statutes, SHIP funds not obligated and expended within the prescribed timeline are subject to deobligation and return to the State Housing Trust Fund. For the current program cycle, funds allocated in FY 2023-2024 must be fully expended by June 30, 2026, absent a formal request for a deadline extension and approval by the FHFC. The expenditure deadline is calculated from the date of allocation and is designed to ensure that SHIP resources are deployed in a timely manner to address local affordable housing needs. The June 30, 2026, expenditure deadline represents a firm compliance milestone for allocated SHIP funds, including obligations, construction activity, and reimbursement of eligible expenses. Failure to meet this deadline could result in: • Forced recapture of unexpended funds by the State; • Reduction in future SHIP allocations; • Audit findings and corrective action requirements; and • Disruption of planned housing activities for very low-, low-, and moderate -income residents. The Administration routinely monitors project delivery timelines, execute funding agreements, and track commitments and expenditures to ensure compliance with the statutory deadline. In cases where allocated funds remain unexpended with no executed agreement or project activity, the City initiates internal recapture and reallocation actions to redirect resources to eligible activities that can be timely obligated and expended before expenditure deadlines. ANALYSIS Recapture of $153,172 FY 23-24 SHIP Funds On October 18, 2023, the Mayor and Commission approved the allocation of SHIP FY 23-24 funds in the amount of $153,172 for the rehabilitation of the Lois Apartments, an affordable housing property owned by the Housing Authority of the City of Miami Beach (HACMB) via Resolution No. 2023-32800. Since the initial allocation of $153,172 FY 23-24 SHIP funds to the HACMB for the rehabilitation project, the Administration has undertaken multiple efforts to advance the project within the required program timeframe. On February 2, 2026, HACMB staff informed the Administration the project would not be completed within the required timeframe. To date: • No SHIP funds have been drawn or expended; • No written agreement or funding contract has been executed between the City and HACMB for this allocation; and • No construction or eligible rehabilitation activity has commenced. Given the absence of an executed agreement and the lack of financial commitment or encumbrance, the Administration has determined that retaining this allocation for the originally proposed project would create unnecessary expenditure risk and potential non-compliance with SHIP statutory deadlines. The Administration seeks to recapture SHIP FY 23-24 funding to another eligible program activity to comply with the expenditure deadline of June 30, 2026. 263 of 1677 The recapture action constitutes an internal administrative reallocation of funds within the City's SHIP portfolio to ensure: • Compliance with the June 30, 2026 expenditure deadline; • Timely deployment of funds to eligible activities under the adopted FY 2022-2025 (LHAP); • Mitigation of the risk of deobligation or negative compliance findings; and • Preservation of the City's standing with the FHFC under SHIP. The recaptured funds will be reallocated to an eligible homeowner assistance strategy pursuant to the adopted LHAP, where they can be timely obligated and expended in accordance with SHIP program requirements. For example, the funds can be used for down payment assistance to a very -low income household. Recapture of FY 19 HOME Investment Partnership Program Funds4300,000 On May 8, 2019, the Mayor and Commission approved the allocation of FY 19 HOME funds in the amount of $300,000 to the HACMB for the rehabilitation of 841 80th street, a vacant multi- family housing property, via Resolution No. 2019-30812. On October 19, 2021, the City and HACMB executed a HOME Program Agreement for the rehabilitation of the property, along with a mortgage and restrictive covenant, which expired on September 30, 2023. Prior to the expiration date, the Administration engaged the HACMB and formally requested updated project documentation. The purpose of this request was to determine whether sufficient progress had been made to justify seeking an extension to HUD's HOME Program 4-year agreement completion deadline. However, the documentation demonstrating substantial progress was not provided and the extension request was not submitted to HUD. The $300,000 allocated to HACM13 for the rehabilitation project at 841 80th street has not been expended, and as part of the City's internal fiscal controls and monitoring responsibilities, it is necessary to formally recapture these funds.. Reallocation of Previously Recaptured HOME Funds and Unencumbered HOME funds The Office of Housing and Community Services has worked collaboratively with the Finance Department to review HOME funds from prior HOME activities that were de -obligated or closed out. Staff have determined that $127,234.03 remain in a recaptured HOME fund account and can be reallocated to an eligible HOME program activity. Rather than holding these funds idle, the Administration recommends consolidating them into a unified acquisition strategy to maximize impact and streamline compliance tracking. Additionally, staff identified $6,148.84 in unencumbered funds which can be leveraged as part of a larger acquisition financing structure. Reallocation of Funds Towards Acquisition of a Multi -Family Property The Administration recommends reallocating $433,382.87 of combined HOME funds toward the acquisition of property to expand the City's affordable housing inventory. Given escalating land values and limited inventory within Miami Beach, acquisition is increasingly a necessary tool to maintain affordability and prevent displacement. The Administration will ensure that any acquisition activity complies with HOME regulations, including environmental review requirements, underwriting standards, affordability periods, and income eligibility requirements. The proposed reallocation of $433,382.87 in available HOME funds would allow the Administration to pursue acquisition of properties, would augment the funds currently available for acquisition and would allow the Administration to initiate its due diligence process of identifying a property that is in good physical condition, and recently renovated or substantially improved. The reallocation of these SHIP and HOME funds helps the City avoid federal recapture, redirect resources to projects that can be promptly delivered, and support long-term affordable housing 264 of 1677 goals. FISCAL IMPACT STATEMENT $153,172 SHIP FY 23-24 FUNDS $300,000 FY HOME FUNDS $127,234.03 RECAPTURED HOME FUNDS $6,148.84 UNENCUMBERED HOME FUNDS Does this Ordinance require a Business Impact Estimate? (FOR ORDINANCES ONLY) If applicable, the Business Impact Estimate (BIE) was published on: See BIE at: https•liw miamibeachFl aov/city-hall/city-clerk/mecting-notices/ FINANCIAL INFORMATION 152-0530-000349-23-404-534-00-00-00-60657-$153,172 179-0530-000346-23-004-534-00-00-00-53319-$300,000 179-7000-101033-$127,234.03 179-0530-000670-23410-535-00-00-00-59022 $6,148.84 CONCLUSION The Administration recommends that the Mayor and City Commission adopt the Resolution authorizing the recapture and reallocation of State Housing Initiative Partnership (SHIP) funds and HOME Investment Partnership (HOME) funds. This recommendation supports long-term affordability, strengthens compliance with HUD requirements, and advances the City Commission's priority of increasing and preserving affordable housing opportunities for Miami Beach residents. Applicable Area Citywide Is this a "Residents Right to Know" item, pursuant to City Code Section 2-177 No Is this item related to a G.O. Bond Project? No Was this Agenda Item initially requested by a lobbyist which as defined in Code Sec. 2.481 includes a principal engaged in lobbying? No If so, specify the name of lobbyist(s) and principal(s): Department Housing and Community Services 265 of 1677 Sponsor(s) Co-sponsor(s) Condensed Title Approve Recapture and Reallocation of HOME and SHIP Funds. HCS Previous Action (For City Clerk Use Only) 266 of 1677