ACTION REQUESTED:
Title
Communication from the City Manager and the Community Development Director with a Recommendation to APPROVE Allocating $50,000.00 in CDBG Funds for a PILOT LOCAL HISTORIC DISTRICT REHAB PROGRAM. (Council Districts 1, 2 and 3).
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BACKGROUND:
On September 10, 2013, City Council approved the 2013 U.S. Dept. of Housing and Urban Development (HUD) budget (item # 13-377). In the budget, $50,000 was approved for housing rehab programs specifically allocated to Peoria City/County Health Dept. in match/leverage funds for the Health Dept.'s lead-based paint removal program. The same allocation of match/leverage funds ($50,000) was approved by Council on October 14, 2014 (item # 14-406) as a part of the 2014 HUD budget. In late 2014, City staff was notified by the Health Dept. that the grant for the lead-based paint removal program was not awarded and the Dept. anticipates to reapply in 2015 for a 2016 grant award. Therefore, the match/leverage funds that were allocated as a part of the 2013 and 2014 HUD budgets are not immediately needed.
As a part of the 2015 programming discussions, staff reviewed the funds available, participation in existing programs and the identified needs for other programs/resources. City staff is recommending a pilot rehabilitation assistance program to assist low-income homeowners of properties located in a local historic district (see attached map). The funding for the pilot program would come from the 2013 CDBG funds initially allocated the Peoria City/County Health Dept.
Below is an outline of the guidelines for the pilot Local Historic District Rehab Program using CDBG funds:
1) Eligible Applicants: Homeowners, whose annual adjusted gross income is less than or equal to 80% of the Area Median Income (AMI). Using the 80% AMI cap, the maximum income for a family of four would be $50,950. This cap would be adjusted based upon the annual release of the AMI for Peoria County.
2) Eligible Properties: Owner-occupied, single family properties located in local historic districts. Properties must be current on property taxes, mortgage and homeowner insurance.
3) Amount of Assistance: A maximum amount of $15,000 per property. No dollar match contribution is required by the homeowner.
4) Eligible Rehab Costs: Exterior only improvements can be addressed with this program. Project's scope of work will be approved by the City's Historic Preservation Commission and Rehab Staff.
5) Continued Program Compliance: During the first year following project completion, the homeowner cannot vacate and lease the property; turning the property into a rental property. Additionally, if the homeowner sells the property within the first year following project completion and as a result of the resale makes a profit, the homeowner will owe back to the City a portion of the CDBG funds provided. 1/12th of the total assistance provided will be forgiven each month. Special permitted transfers are allowed within the first year that addresses the issue of foreclosure, death of owner, etc. A deed covenant/restriction will be recorded against the property to secure the one year provision. The homeowner will pay the recording fees of the deed covenant/restriction.
This program and its funding is designed to be a pilot program. At the end of 2015, staff will reevaluate the program's participation and funding to determine its continuance.
Once approved, staff will begin to market the program and a formal application will be distributed. Eligible applications will be reviewed by staff and taken to the Historic Preservation Commission for approval.
FINANCIAL IMPACT: $50,000 is currently available (project number -13LM00) from the 2013 CDBG funding. The additional $50,000 that was allocated to the Peoria City/Health Dept. for matching/leverage in the 2014 CDBG budget will remain committed to the Health Dept. for its 2015 grant application for potential 2016 funding for the lead-based paint removal program.
NEIGHBORHOOD CONCERNS: Assistance for low-income homeowners in historic districts has been identified in the past as a concern by residents and City Council.
IMPACT IF APPROVED: A pilot program that provides rehab assistance to low-income homeowners in local historic districts will be available in 2015.
IMPACT IF DENIED: The pilot program will not be available in 2015 and the funds available will remain committed to the Peoria City/County Health Dept.
ALTERNATIVES: None identified at this time.
EEO CERTIFICATION NUMBER: N/A
WHICH OF THE GOALS IDENTIFIED IN THE COUNCIL'S 2014 - 2029 STRATEGIC PLAN DOES THIS RECOMMENDATION ADVANCE?
1. Attractive Neighborhoods with Character: Safe and Livable
WHICH CRITICAL SUCCESS FACTOR(S) FROM THE COMPREHENSIVE PLAN DOES THIS RECOMMENDATION IMPLEMENT?
1. Reinvest in neighborhoods.
DEPARTMENT: Community Development