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HomeMy WebLinkAbout1996-01-23 - AGENDA REPORTS - FED FUND EARTHQUAKE RECOVERY (2)e 11741 044 DI an Item to be presented by: Ken Pulskamp UNFINISHED BUSINESS DATE: January 23, 1996 SUBJECT: Status Report of Federally Funded Earthquake Recovery Programs DEPARTMENT; Community Development After the January, 1994 earthquake, the City of Santa Clarita received funds from the U.S. Department of Housing and Urban Development (HUD) to address Community Development Block Grant eligible activities related to earthquake recovery. The City was also awarded earthquake recovery funds from HUD through the State Department of Housing and Community Development (HCD). Both of these funding sources were to address a variety of disaster recovery needs, especially with respect to residential rehabilitation. With the help of the City Council, staff has been able to formulate several programs to address a variety of earthquake recovery needs. It is the intent of this report to provide the Council with an update on the recovery programs that are designed to assist residents with their continuing disaster needs. Programs Funded by the U.S. Department of Housing and Urban Development The City's emergency supplemental appropriation from HUD allowed the City to undertake Community Development Block Grant (CDBG) eligible activities that were earthquake recovery related. After an extensive public participation process, the Council allocated $2,250,000 into residential rehabilitation programs. The programs are as follows: Major Rehabilitation - This program is a deferred, low interest loam program, designed to assist residents with large amounts of residential repair needs. Loans of $5,000 to $30,000 will be issued to City residents to address their rehabilitation needs. Eligible residences includes single family homes, condominiums, and mobilehomes, with the exception of common areas maintained by homeowner's associations and mobile home park owned improvements. These loans will be due when the property is sold or refinanced. Limited Assistance - This program provides grants to homeowners to target visible external rehabilitation needs, such as damaged driveways, doorways, and chimney repair. Grants of up to $5,000 per household will be issued. Following an application period, residents must fast make the needed repairs, and then seek reimbursement from the City. I- Agenda [ y .^ 1 d� t F Multi Family Rehabilitation - This program provides funds to owners of multi family rental property for rehabilitation of rental units. Eligible dwellings include any multi family complexes of five or more units. The maximum loan amount provided will be $10,000 per rental unit. Programs Funded by the State Department of Housing and Community Development In addition to programs funded by HUD, the City received funds from HUD which were awarded on a competitive basis. The City received two separate awards totaling$2,485,950. The guidelines ruling the use of these funds are also strict, allowing the City to implement two programs available as a result of this award. HOME Program for Disaster Relief - The HOME Program provides low interest, deferred, loans to low income households. These loans assist residents with residential repair needs, while at the same time not increasing their monthly housing expenses. Loans of $5,000 to $20,000 maybe issued to City residents to address their rehabilitation needs. Eligible residences includes single family homes, condominiums, and mobilehomes, with the exception of common areas maintained by homeowner's associations and mobile home park owned improvements. These loans are due when the property is sold or refinanced. HOME Program for Multi Family Rehabilitation - This program provides loans to owners of multi family rental property for rehabilitation of rental units, where the tenants of the units are in the low income category. The maximum loan amount is $15,000 per rental unit. Owners of multi family property who receive loans from this program will be required to record a covenant stating that at least 20% of the assisted units will be restricted to housing low income tenants for the life of the loan, or until the loan is repaid. It is important to note that some of these funds are income restricted. The two programs funded by HCD are targeted at low income households. For reference, a family of four that earns $40,200 or less annually is considered to be in the low income category. The funds provided by HUD normally have an income restriction, and allow assistance to moderate income households. For reference, a family of four that earns $61,550 or less annually is considered to be in the moderate income category. The matrices on the following pages illustrate several key features of each program; There are similar requirements in all of the programs. For example, all applicants must have applied to FEMA, SBA, IFGP, and to private insurance for assistance, and have either been denied assistance, or have received insufficient assistance to meet their needs. These programs are also only able to assist property owners who owned the subject property at the time of the earthquake. Investors who bought property at low market value are not eligible to receive funds from any of these programs. 117 Receive and file. emersupp\012396.agn PROGRAMS FUNDED BY THE U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT LIMITED ASSISTANCE I MAJOR REHABH,ITATION I I%MLTI FAMILY REHAB To provide grants to home owners who have unmet but small scale damage such as chimney repair. Home owners of any income level. Owned prior to 1.17-94. Must be homeowner's primary residence. SBA, FEMA, IFGP, Private Insurance. First come, first served. $5,000 maximum grant Not Applicable Not Applicable Not Applicable Not Applicable Yes Yes (except common areas) Yes (except common areas) No Yes Damage that was made directly by the 10-17-94 earthquake, except to personal property. Excluded repairs include new construction, upgrades, damage to, luxury items, (Jacuzzis, barbeque pits, pools) and damage to common areas. Gross income of all persons who share the dwelling unit, plus income from disability, public assistance, interest, social security, real estate and net business income. $843,750 (37.5% of total allocation) Would fund approximately 150 grants $5,000 each plus administrative costs.. Same as HOME Program but allows participation by home owners above the low income level. A low interest loan program. Moderate income home owners.. Owned prior to 1.17-94. Must be homeowner's primary residence. SBA, FEMA, IFGP, Private Insurance. First come, first served. $5,000 minimum loan $30,000 maximum loan Deferred Loans 3% compounded annually Due upon resale No Yes Yes (except common areas) Yes (except common areas) No Yes Damage that was made directly by the 10- 17-94 earthquake, except to personal property. Excluded repairs include new construction, upgrades, damage to luxury items (pools, Jacuzzis, barbeque pits), and damage. to common areas. Gross income of all persons who share the dwelling unit, plus income from disability, public assistance, interest, social security,. real estate and net business income. $843,750 (37.5% of total allocation) Would fund approximately 27 loans $30,000 each plus administrative costs.. To provide rehabilitation loans to owners of rental units in order to make needed earthquake repairs and preserve rental housing stock.. Property owners of low income units. Owned prior to 1-17-94. Owners, partnerships, inv. groups. SBA, FEMA, IFGP, Private Insurance. At discretion of City based on need. $10,000 maximum loan per rental unit Determined on an individual basis depending upon need. Loan to value ratio can not exceed 90%. No No No No Yes - 5 or more units No Damage that was made directly by the 10- .17-94 earthquake, except to personal. property. Excluded repairs include new construction, upgrades, and damage to luxury items (pools, Jacuzzis, barbeque pits), and damage to common areas. Gross income of all persons who share ownership in the property, plus income from interest, real estate and net business income. $562,500 (25% of total allocation) Would provide assistance to approximately 50 units. PROGRAMS FUNDED BY THE STATE DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT HOME PROGRAM • SINGLE FAMILY REHAB I HOME PROGRAM - MULTI FAMILY REHAB To provide low interest deferred loans to low income home owners for unmet earthquake repairs without increasing the household's monthly housing expense. Home owners of low income level. Owned prior to 1-17-94.. Must be owner's primary residence. SBA, FEMA, IFGP, Private Insurance. First come, first served. $5,000 minimum $20,000 maximum Deferred loans 3% simple interest. Due upon resale or refinance of the property. No Yes Yes (except common areas) Yes (except common areas) No Yes Damage that was made directly by the January 17, 1994 earthquake. Excluded repairs include new construction, upgrades, damage to swimming pools, Jacuzzis, barbeque pits, and other luxury items. Personal property replacement is excluded. May not be used to reimburse for previously made repairs. Gross income of all persons who share. the dwelling unit, plus income from disability, public assistance, interest, social security, real estate and net business income. $1,500,000 $1,428,571 in loan funds, (Approximately 70 loans). $71,429 for administrative costs. To provide rehabilitation loans to owners of rental units in order to make needed earthquake repairs and preserve rental housing stock. Property owners of low income units owned prior to 1-17-94. Owners, partnerships, investment groups. SBA, FEMA, IFGP, Private Insurance. At discretion of City based on need. $15,000 maximum per rental unit Deferred loans 5% simple interest. Loan to value ratio can not exceed 90% 30 years. No No No No Yes - 5 or more units No Damage that was made directly by the January 17, 1994 earthquake, except to personal property. Excluded repairs include new construction, upgrades, damage to swimming pools, Jacuzzis, barbeque pits and other luxury items. Repair of damage to common areas is excluded. May not be used to reimburse for previously made repairs. Gross income of all persons who share ownership in the property, plus income from, interest, real estate and net business income. $985,950 $939,000 in loan funds. (Approximately 62 units assisted). $46,950 for administrative costs.