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Local Housing Assistance Funds . . . . '" RESOLUTION N0 273-00 A RESOLUTION AUTHORIZING AN APPLICATION TO THE IOWA DEPARTMENT OF ECONOMIC DEVEWPMENT FOR LOCAL HOUSING ASSISTANCE PROGRAM FUNDS Whereas, the Iowa Department of Economic Development has published notice of availability of funds under the Local Housing Assistance Program (LHAP) ; and Whereas, the Department of Economic Development is encouraging municipalities to promote housing assistance programs which address umnet needs and complement current and planned programs of economic development; and Whereas, the Consolidated Plan for the City of Dubuque includes the objectives of promoting homeownership opportunities for low- and moderate-income households, elimination of slum and blight and public and private investment in revitalization of downtown neighborhoods; and Whereas, the Housing Services Department has for the past two years successfully administered a homebuyer assistance program for moderate-income families funded through an LHAP award received from the Department of Economic Development; and Whereas, the Housing Trust Fund Committee and Housing Commission have reviewed the proposed applications fur moderate-income household home purchase assistance and for construction of affordable new condominium homes for low-income households. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA. Section 1. The Mayor is hereby authorized to execute this resolution in support of two applications to the Department of Economic Development for Local Housing Assistance Program funds, to assist in provision of home purchase assistance to low-and moderate-income households. Section 2. This resolution shall take effect immediately. Passed, approved and adopted this ll}'h day of June, 2000. m Terrance M. Duggan, Mayor Attest: Jeanne F. Schneider, City Clerk . CITY OF DUBUQUE, IOWA MEMORANDUM June 15, 2000 TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: Pre-application for Local Housing Assistance (LHAP) Funds . Housing Services Manager David Harris is recommending approval of two pre-applications to the Iowa Department of Economic Development (lDED) for Local Housing Assistance Program funds, for two programs of assistance to low- and moderate-income homebuyers. The Housing Trust Fund Committee and Housing Commission have approved submission of another application to IDED for moderate-income buyer assistance. With this program, the Housing Department can offer a complement to the CDBG-funded First-time Homebuyer Program, which provides assistance to buyers earning below 80% of area income. The City currently has another pending PATH Program application to the Federal Home Loan Bank, which previously awarded $350,000 to the Housing Department to assist first-time buyers earning less than 60% of area income. The City closed 39 loans through the PATH (Pathways Affordable to Homeowners) Program last year, in partnership with seven sponsoring local lending institutions. With this continuing variety of programs, we can provide financial assistance to buyers at all low- and moderate-income levels to help families attain home ownership. The proposed LHAP "pre-application" is for $100,000, to again provide purchase and rehabilitation assistance to moderate-income families, projected to result in purchase of 13 homes. This assistance is provided as 4%, long-term loans, up to $800,000 for purchase and rehab. I concur with the recommendation and respectfully request Mayor and City Council approval. ( (J (11J'J ~1t,dt~ Mibhael C. Van Milligen MCVM/dd Attachment VI I f,n\.>:io.r";o "",,_, f",> 8JIUO S,',.o .' II,!,-, . cc: Barry Lindahl, Corporation Counsel Tim Moerman, Assistant City Manager David Harris, Housing Services Manager S I :21 Hd S I NDf 00 03/\13~J38 . ~ ~ CITY OF DUBUQUE, IOWA MEMORANDUM 14 June 00 TO: Mike v~ren, City Manager FROM: David ~arris, Housing Services Department RE: Pre-application for Local Housing Assistance (LHAP) funds INTRODUCTION The purpose of this memorandum is to request the City Council's authorization to apply to the Iowa Department of Economic Development (lDED) for Local Housing Assistance Program funds, for two programs of assistance to low- and moderate-income homebuyers. . DISCUSSION The Housing Services Department has previously successfully applied to IDED for Local Housing Assistance Program funding, most recently receiving a $400 000 grant last year for assistance to the Maria House transitional housing project and for construction of a new 18-bed single room occupancy (SRO) facility on Garfield Avenue. Also previously (1998) funded through LHAP was a $150 000 homebuyer assistance program- providing both downpayment and rehabilitation loans - to moderate-income fumilies (earning between 80 and 100% of area median income) - purchasing homes in selected downtown and near-downtown census tracts. To-date, we have closed on 16 properties, averaging $61 000 per sale, with fami1y income averaging 90% of median. Total private financing has averaged $52000 per home. . The Housing Trust Fund Committee and Housing Commission have approved submission of another application to IDED fur moderate-income buyer assistance. With this program, the Housing Department can offer a complement to the CDBG-funded FirstTime Homebuyer Program, which provides assistance to buyers earning below 80% of area income. And we currently have another pending PATH Program application to the Federal Home Loan Bank, which previously awarded $350 000 to the Housing Department to assist first-time buyers earning less than 60% ofarea income. We closed 39 loans through our PATH (pathways Affordable to Homeowners) Program last year, in partnership with seven sponsoring local lending institutions. With this continuing variety of programs, we can provide financial assistance to buyers at all low- and moderate-income levels to help fumilies attain homeownership. . . . - The proposed LHAP "pre-application" is for $100 000, to again provide purchase and rehabilitation assistance to moderate-income fumilies, projected to result in purchase of 13 homes. This assistance is provided as 4%, long-term loans, up to $8000 for purchase and rehab. In addition, the Trust Fund Committee and Housing Commission have approved submission of a second pre-application for LHAP funds, to address a long-standing problem of blight and deterioration on West Eighth Street. Two vacant-abandoned houses, in the 600 block, have been proposed by the owner to be demolished. In their place, a five-unit condominium home development will be constructed. At present, the developer's projected home sale price is $70 000. These homes will then be sold to first-time buyer households earning no more than 60% of area median income. The LHAP funds will be utilized by the Housing Department to subsidize this cost, with $20 000 second mortgages provided and furgiven over term, resulting in actual sales price of$50 000. In this way, multiple objectives of slum clearance, reinvestment in a downtown neighborhood and additional owner occupancy for low-income households can be achieved. $100 000 is proposed to be requested in LHAP funds for this purpose. RECOMMENDATION It is recommended that the Council approve the two pre-applications to IDED for Local Housing Assistance Program funds. If these pass initial Department review, the Housing Department will be invited to submit a full application in August, with notification of award in January 2001. The resolution authorizing this application is attached.