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Trust Fund Ordinance AmendmentMEMORANDUM TO: FROM: SUBJECT: November 19, 2003 The Honorable Mayor and City Council Members Michael C. Van Milligen, City Manager Trust Fund Ordinance Amendment Housing and Community Development Department Director David Harris is recommending City Council approval of an amendment to Chapter 26 of the Code of Ordinances, authorizing the Housing Trust Fund Committee to direct use of funds received from the Iowa Finance Authority's Local Housing Trust Fund and Project- Based Housing Programs. The Iowa Legislature, in its last session, has created a State Housing Trust Fund and capitalized it with a current fiscal year allocation of $2.8 million. Local trust funds are eligible to apply for these funds, with an application deadline for this year set for December 15. As required by the Iowa Finance Authority, ordinance amendments are required to establish the Housing Trust Fund Committee's intent. Specifically the amendments are: 1. establishes the authority of the Housing Trust Fund Committee to "direct, without further approval of any city officer or the City Council, how such funds shall be used in accordance with the Iowa Finance Authority Trust Fund Allocation Plan;" and 2. establishes the authority of the Trust Fund Committee to "direct how such [required local matching] funds shall be used in accordance with the Iowa Finance Authority Trust Fund Allocation Plan." The City Council would, however, approve any Trust Fund Committee application to the Finance Authority, pdor to its submission, and would approve commitment of any required local matching funds as part of any application. concur with the recommendation and respectfully request Mayor and City Council approval. Michael C. Van Milligen MCVM/jh Attachment cc: Barry Lindahl, Corporation Counsel Cindy Steinhauser, Assistant City Manager David Harris, Housing and Community Development Director CITY OF DUBUQUE, IOWA MEMORANDUM 19 November 03 To: Mike V~Milligen, City Manager From: David'Harris, Housing and Community Development Department Re: Trust Fund Ordinance Amendment Introduction The purpose of this memorandum is to request the City Council's approval of an amendment to Chapter 26 of the Code of Ordinances, authorizing the Housing Trust Fund Committee to direct use of funds received from the Iowa Finance Authority's Local Housing Trust Fund and Project-Based Housing Programs. Background The Housing Trust Fund Committee was established by ordinance in 1992, to "collect and disburse revenue to meet the housing needs of Iow and moderate income households" in the City. Establishing the Trust Fund Committee was a primary recommendation of the Affordable Housing Task Force, which issued its report in 1991. Since that time the Trust Fund Committee has awarded nearly $2 million in grants to accomplish affordable housing. These have included two awards, totaling $580 000 from the Des Moines Federal Home Loan Bank, to promote homeownership for lower-income households. The Committee has also received $900 000 from the Iowa Department of Economic Development since 1992, including awards for the construction of the Davis Place single rooming facilities on Garfield Avenue, the West 8th Street condominium project and conversion of the former St Mary's Convent into the Maria House transitional housing facility. CDBG allocations to the Trust Fund from the City Council have totaled more than $400 000 during the past ten years, and have accomplished a number of worthwhile housing projects, including grants to the Food Pant~, the Center for Public Ministry, the Y's Domestic Violence Shelter, Gateways to Home and DHI/Mercy Housing. Discussion The Iowa Legislature, in its last session, has created a State Housing Trust Fund and capitalized it with a current fiscal year allocation of $2.8 million. Local trust funds are eligible to apply for these funds, with an application deadline for this year set for 15 December. The Iowa Finance Authority has authored the administrative rules for the Trust Fund, including provisions to insure that a local trust fund will operate independently from a local unit of govemment. These requirements include: 1. A local governing board recognized by the city as the board responsible for coordinating local housing programs; 2. ^ local governing board comprised of no more than 50% of individuals from local government and/or public officials. 3. The applicant organization must have a distinct and separate corporate identity (this requirement has been proposed for elimination when the IFA Board meets to approve the rules in December). In negotiations with IFA staff, we have developed an ordinance amendment to meet the intent of the legislative intent. These are proposed for adoption by the Council, as a new Section 37 in Chapter 26. Specifically, this amendment: 1. establishes the authority of the Housing Trust Fund Committee to "direct, without further approval of any city officer or the City Council, how such funds shall be used in accordance with the Iowa Finance Authority Trust Fund Allocation Plan;" and 2. establishes the authority of the Trust Fund Committee to "direct how such [required local matching] funds shall be used in accordance with the Iowa Finance Authority Trust Fund Allocation Plan." The City Council would, however, approve any Trust Fund Committee application to the Finance Authority, prior to its submission; and would approve commitment of any required local matching funds as part of any application. Recommendation It is recommended that the Council approve the amendment to Chapter 26. By so doing, the Dubuque Housing Trust Fund Committee should be certified as an eligible local trust fund, for purposes of application to the IFA State Housing Trust Fund. For this year's competition, this will allow us to submit a proposal for a grant of $100 000 to assist an area affordable housing project. Action Step The action requested of the City Council is to approve the attached amendment to Chapter 26, Housing Regulations, of the Code of Ordinances, authorizing the Dubuque Housing Trust Fund Committee to direct use of funds received from the State Housing Trust Fund and to direct use of Council-authorized matching funds in support of applications to the Iowa Finance Authority's Housing Trust Fund. Preparer: Barry A. Lindahl Address: Suite 330 300 Main Street Dubuque, IA 52001-6944 Telephone: (563) 583-4113 ORDINANCE NO. 93-03 AMENDING THE CITY OF DUBUQUE CODE OF ORDINANCES CHAPTER 26 HOUSING REGULATIONS, ARTICLE III HOUSING TRUST FUND BY ADOPTING A NEW SECTION 26-37 GRANTING AUTHORITY TO THE HOUSING TRUST FUND ADVISORY COMMITTEE TO MAKE APPLICATION TO THE IOWA FINANCE AUTHORITY FOR FUNDS FROM THE LOCAL HOUSING TRUST FUND PROGRAM AND THE PROJECT-BASED HOUSING PROGRAM AND TO DIRECT HOW SUCH FUNDS SHALL BE USED NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA: Section I. City of Dubuque Code of Ordinances Ch. 26 Housing Regulations, Article III Housing Trust Fund is amended by adding thereto a new Section 26-37 as follows: Sec. 26-37. Iowa Finance Authority State Housing Trust Fund Programs. (a) For purposes of the Iowa Finance Authority State Housing Trust Fund, the Housing Trust Fund Advisory Committee shall have the authority to make application to the Iowa Finance Authority for funds from the Local Housing Trust Fund Program and the Project-Based Housing Program and to direct, without further approval of any city officer or the city council, how such funds shall be used in accordance with the Iowa Finance Authority Trust Fund Allocation Plan. (b) Funds received by the city from the Iowa Finance Authority State Housing Trust Fund shall be maintained by the city in a separate account and subject to the direction of the Housing Trust Fund Advisory Committee. (c) For purposes of providing required local matching funds for applications to the Iowa Finance Authority State Housing Trust Fund, the Housing Trust Fund Advisory Committee shall have the final authority to direct how such funds shall be used in accordance with the Iowa Finance Authority Trust Fund Allocation Plan. Allocation of local matching funds to the Housing Trust Fund Advisory Committee shall be made by decision of the City Council. Section 2. This ordinance shall take effect upon publication. Passed, approved and adopted this 1st day of December ,2003. Terrance M. Duggan, Mayo// Attest: ! ~_~anne F. Schneider, Ci~ Cle~ Effect of Amendment ARTICLE III. HOUSING TRUST FUND Sec. 26-31. Trust Fund Established: Subject to the conditions hereinafter set forth, a fund to be known as the City of Dubuque Housing Trust Fund (Trust Fund) is hereby established for the collection and disbursement of funds to meet the housing needs of the City's Iow and moderate income residents. Sec. 26-32. Purpose: The purpose of the Trust Fund shall be to collect and disburse revenue to meet the housing needs of Iow and moderate income households as defined in the City of Dubuque Comprehensive Housing Affordability Strategy (CHAS). This shall in no way construe that these funds will be used to finance housing permanently owned by the City. The Trust Fund, as a permanent and revolving source of revenue, will provide for loans and grants to finance projects including but not limited to, the acquisition, rehabilitation and/or new construction of rental and owner-occupied housing, as well as to provide money for relocation assistance to income-qualified displaced tenants. Sec. 26-33. Financial Management: The financial management of the Trust Fund shall be the responsibility of the Finance Division of the Administrative Services Department of the City, whose responsibilities shall include, but not be limited to, the following: a) holding trust revenue for those purposes defined by the Housing Commission and approved by the City Council; b) disbursing funds for the Housing Commission as appropriated in the annual operating budget approved by the City Council; and c) performing any other function needed to ensure the sound financial management of and accountability for Trust Fund revenues and expenditures. Sec. 26-34. Trust Fund Administration: The Trust Fund shall be administered by the City Manager or his/her designee. The City Manager shall be responsible for, but not limited to, the following: a) marketing the program of the Trust Fund; b) soliciting applications; c) packaging applications for Housing Commission review; d) coordinating legal or financial assistance to the Housing Commission; e) ensuring public participation; f) pursuing new revenue sources; g) overseeing and accounting for funded projects; h) coordinating with the City departments and agencies; i) collecting and servicing loans made by the Trust Fund; j) preparing periodic reports for the Housing Commission and City Council; and k) general day-to-day operation of the Fund. Sec. 26-35. Funding: The Housing Commission shall be responsible for recommending sources of funding and revenues for the Trust Fund to the City Manager and/or City Council. As funds and revenues become available, the activities of the Trust Fund will be carried out as specified in this Article. Notwithstanding the foregoing, however, nothing herein shall require or impose any obligation upon the City Council to provide any funds for any of the purposes of this Article. Sec. 26-36. Housing Commission Trust Fund Advisory Committee: (a) A Housing Trust Fund Advisory Committee of the Housing Commission shall be established to recommend policy direction and oversight to the administration and operation of the Housing Trust Fund by' 1) soliciting funding; 2) developing by-laws to govern the Committee's operations; and 3) developing policies and guidelines for acquisition and distribution of funds. Such solicitations, by-laws, policies and guidelines shall be approved by the Housing Commission and submitted to the City Council for its approval. (b) The Housing Trust Fund Advisory Committee shall coordinate an effective mechanism for public participation in the operation of the Trust Fund, recommend projects to the Housing Commission for funding approval and engage in activities providing for the efficient use of the Trust Fund. (c) The Housing Trust Fund Advisory Committee shall have five (5) members appointed by the City Council to serve for three (3) year terms. Three (3) of the Committee members shall be members of the Housing Commission and two (2) shall be, members of the public. One of the initially appointed Committee members shall serve a term of one year and two (2) of the initially appointed Committee members shall serve terms of two (2) years. The chair of the Trust Fund Advisory Committee shall be appointed by the Housing Commission. The two (2) members of the public shall be selected specifically on the basis of experience in real estate development, banking, finance, accounting, funds management or other related areas of expertise. (d) The Housing Trust Fund Advisory Committee shall hold at least six (6) meetings per year. The Housing Commission may adopt rules and regulations it deems necessary to govem the Committee's organizational procedures and which do not conflict with this Article or other resolutions and/or decisions of the City Council. (e) All administrative, personnel, accounting, budgetary and procurement policies and practices of the City shall govern the Housing Trust Fund Advisory Committee in all its operations and activities. Sec. 26-37. Iowa Finance Authority State Housin,q Trust Fund Pro,qrams. (a) For purposes of the Iowa Finance Authority State Housin,q Trust Fund, the Housin,q Trust Fund Advisory Committee shall have the authority to make application to the Iowa Finance Authority for funds from the Local Housin.q Trust Fund Proqram and the Proiect-Based Housin.q Proflram and to direct, without further approval of any city officer or the city council, how such funds shall be used in accordance with the Iowa Finance Authority Trust Fund Allocation Plan. (b) Funds received by the city from the Iowa Finance Authority State Housin.q Trust Fund shall be maintained by the city in a separate account and subiect to the direction of the Housin.q Trust Fund Advisory Committee. (c) For purposes of providin.q required local matchin,q funds for applications to the Iowa Finance Authority State Housin,q Trust Fund, the Housin.q Trust Fund Advisory Committee shall have the final authority to direct how such funds shall be used in accordance with the Iowa Finance Authority Trust Fund Allocation Plan, Allocation of local matching funds to the Housing Trust Fund Advisory Committee shall be made by decision of the City Council.