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Home My WebLink AboutAUTHORIZE ADDITIONAL LOAN FUNDS FOR THREE HOUSING REHABILITA Council/Agency Meeting Held: Deferred/Continued to: Appr ved ❑ Conditionally Approved ❑ Denied �'�-YoCity rk's Xignak r Council Meeting Date: 4/21/2008 Department ID Number: ED 08-17 CITY OF HUNTINGTON BEACH REQUEST FOR CITY COUNCIL ACTION SUBMITTED TO: HONORABLE MAYOR AND CITY COUNCIL MEMB , R SUBMITTED BY: PAUL EMERY, INTERIM CITY ADMINISTRATOR PREPARED BY: STANLEY SMALEWITZ, DIRECTOR OF ECONOMIC DEVELOPMENT SUBJECT: AUTHORIZE ADDITIONAL LOAN FUNDS FOR THREE HOUSING REHABILITATION LOANS - NOVIN / LIDDELL /TAYLOR Statement of Issue,Funding Source,Recommended Action,Alternative Action(s),Analysis,Environmental Status,Attachment(s) Statement of Issue: The Housing Rehabilitation Loan Program Guidelines (Program) allows the City Council to approve home repair loans and grants in excess of the prescribed maximum loan and grant limits outlined for single family home owners. The City Council is being asked to approve three loans and a grant as required by the City Council adopted Housing Rehabilitation Loan Program guidelines. Funding Source: Community Development Block Grant (CDBG) revolving rehabilitation loan fund #21580301, for a total of$206,850. Recommended Action: Motion to: 1. Authorize the Director of Economic Development to approve a housing rehabilitation loan in a total amount not to exceed $75,000.00 and an Emergency Repair Grant in the amount of $1,850.00 for Mary Novin. 2. Authorize the Director of Economic Development to approve a housing rehabilitation loan for Jean Liddell in a total amount not to exceed $75,000.00. 3. Authorize the Director of Economic Development to approve a housing rehabilitation loan for Marguerite Taylor in a total amount not exceed $55,000.00. Alternative Action(s): Do not authorize the Director of Economic Development to approve the proposed loan and grant amounts for borrowers Novin, Liddell, and Taylor. RPR-07-200B 11:53 r-. !1S JK CONSTRUCTION 915 LAKE STREET HUNTINGTON BEACH, CA 92648 Date 9/26/2007 Estimate # 16 'qv�If il '1);7 i.77i, 71'1r(l A4 Y MARY NOVIN HUNTINGTON BEACH, CA 92647 P.O. # Due Date 9/26/2007 Terms Other Pjj ig"i, Lwl THIS ESTIMATE SUPERCEEDS ANY &ALL WORK WRITE-UPS AND PLANS AND WILL STAND ON ITS OWN FOR CONTRACT PURPOSES. DUE TO THE EMERGENCY STATUS OF THIS PROJECT HOMEOWNER WAIVES HER RIGHT TO THE 3-DAY RIGHT TO CANCEL PER THE CONTRACTORS LICENSE LAW AND AUTHORIZES JK CONSTRUCTION TO START WORK ON THE DATE OF SIGNING. ACCEPTED HOMEOWNER DATE ACCEPTED CONTRACTOR DATE Subtotal $26,735.00 Sales Tax (0.0%) $0.00 Total $26,735.00 JK CONSTRUCTION jmckinish002@socai,rr.com 714-960-7952 Fax 714-536-3878 Page 3 TOTAL P.04 APR-07-2ooe 11:40 139/ P.04 Project Budget Summary Work to be Paid With Additional Loan Funds Mary Novin -7602 Seine Drive, Huntington Beach 1 Permits $500.00 2 Removal 1,500.00 3 Fumigation 1,800.00 4 Remove Trellis 250.00 5 Carpentry 1,390.00 6 Roof Repair 500.00 7 Garage Plumbing 1,800.00 8 Garage Electrical 2,000.00 9 Garage Clean-up 1,200.00 11 Guest Bath 1,100.00 12 Master Bathroom 3,600.00 13 Master Bedroom Closet 500.00 14 Bedroom No. 1 950.00 15 Bedroom No. 2 600.00 16 Hall Linen Closet 950.00 17 Kitchen 4,500.00 18 Electrical 4,000.00 19 Interior Painting 4,800.00 20 Exterior Painting 3,500.00 21 Windows 4,000.00 Phase I Change Order 11/15/07 4,640.00 Subtotal $43,980.00 Contingency 3,220.00 Loan Fees to City as per Program Guidelines 300.00 Loan Amount $47,500.00 ATTACHMENT #3 APR-07-2008 11:52 r.Ul XCONSTRUCTION 37 r5oS7 INVOICE 915 LAKE STREET Huntington Beach, CA 92648 Date Invoice# (714) 960-7052 (800) i 34-0337 I t/212007 4702 FAX (714) 536-38(18 NAME/ADDRESS a CIY OF HUNTINGTON BEACH ' "`' 6�0 i - MA NY M 0 VIA/ ATT:ROBERT COPENNAVI A FOP, _X)ISPC6A(./14AL% jG FOR MARTE NOVA N of-, C10fic zeTC F12011A_ 7602 SQN DR. BACK 4A RD HB.CA.92647 P.O. No. Terms Project NOVAN,MARY/C... Item Description Total % Amount DUMpSTER RENTAL FA2'LOW BOY DUMPSTGRS io0.WA 950.00 DEM CLEAN-UP DEBRIS AND CONCRETI:REMOVAL,FROM i 00.00% 1,000.00 BACK YARD JOB CONTLETr•,! Total SI.M.00 Paymenl!WCredits S0.00 Balance Due 5,.850.00 APR-07-2008 11:39 P.01 ATTACHMENT #4 Scope of Work - Liddell 26-Feb-08 Budget Estimate Total Approved Loan Special Needs Request 1 Roof& Roofing $ 15,000.00 $ 15,000.00 $ - 2 Building Addition&Insulation $ 2,000.00 $ 2,000.00 3 Exterior Wall Treatment,Hardie $ 7,250.00 $ 7,250.00 4 Fumigation $ 1,200.00 $ 1,200.00 5 Windows $ 6,300.00 $ 6,300.00 6 Paint Trim $ 3,000.00 $ 3,000.00 7 Bathroom(s)&related work $ 12,500.00 $ 12,500.00 $ - 8 Kitchen $ 12,500.00 $ 12,500.00 9 Flooring $ 4,650.00 $ 4,650.00 10 Interior Painting $ 2,500.00 $ 2,500.00 11 Font Walkways etc. $ 2,500.00 $ 2,500.00 12 Rear yard fencing&Clean-up $ 5,000.00 $ 5,000.00 $ 74,400 $ 27,500 $ 46,900 Add Drawings $ - $ - $ 1,000 $ 74,400 $ 27,500 $ 47,900 Recommended Contingency $ 10,000.00 $ - $ 9,000.00 Non-Profit Assistance: "Projected Savin $ (10,000.00) $ - $ (10,000.00) Loan Fees $ 600.00 $ 600.00 Total Budget $ 75,000.00 $ 27,500.00 $ 47,500.00 REQUEST FOR CITY COUNCIL ACTION MEETING DATE: 4/21/2008 DEPARTMENT ID NUMBER: ED 08-17 Analysis: The City's current Housing Rehabilitation Loan Program Guidelines, which were adopted on January 6, 2003, allow qualifying homeowners to receive a grant (maximum $1,000) to pay for an emergency repair event, or to borrow up to $25,000 to use for health and safety related repairs and improvements. The guidelines currently allow the Director of Economic Development to administratively approve loans up to an additional 10% when necessary to ensure that all health and safety related issues are addressed. Any extension of loan or grant funds above the determined maximum prescribed amount plus 10% must be approved by City Council (See Attachment 1 Housing Rehabilitation Loan Program Guidelines, Page 2). GRC Associates, the consultant hired by the City to administer the Program, recently presented three loan applications for approval, each of which is over the maximum loan amount due to extreme disrepair requiring immediate attention. The loan and grant amounts being requested and circumstances of each of the applicants (borrowers) are outlined and discussed below: Borrower Initial Loan Additional Grant Funds Total Combined Name and Already Funds Requested Loan/Grant Amt Address Approved Requested Mary Novin $27,500 $47,500 $1,850 $76,850 7602 Seine Dr. Jean Liddell $27,500 $47,500 $0 $75,000 9192 Guss Dr. Marguerite Taylor $27,500 $27,500 $0 $55,000 15442 Capri Circle MARY NOVIN, 7602 SEINE DRIVE In 2007, homeowner Mary Novin was referred to the Economic Development Department by the City's Code Enforcement Division when she was forced to vacate her property after dealing with a builder that did not adhere to the contract. With code-deficient work, her home open to the weather, and an infestation of bees, Ms. Novin came to the City for assistance and applied for a housing rehabilitation loan as a very-low income resident. She was extended a low-interest, deferred payment loan from the City in the amount of $27,500 (the current maximum loan amount plus 10%) to pay for repairs needed immediately on her home. While the work covered by Ms. Novin's initial loan provided for her return home, there are still many repairs that need to be done, as noted in Attachment 2. Staff is requesting additional loan funds in an amount not to exceed $47,500 to complete all of the remaining health and safety repairs. To further assist Ms. Novin, staff is recommending that the City Council also approve an emergency repair grant to Ms. Novin in the amount of $1,850 to pay for the loading and disposal of a large amount of demolished, code-deficient concrete from her backyard (See Attachment 3 Documentation for $1,850 Emergency Repair Grant). The City -2- 4/8/2008 4:36 PM REQUEST FOR CITY. COUNCIL ACTION MEETING DATE: 4/21/2008 DEPARTMENT ID NUMBER: ED 08-17 Council is being asked to approve this grant because it exceeds the maximum prescribed grant limits and will be granted in addition to a housing rehabilitation loan. JEAN LIDDELL, 9192 GUSS DRIVE Ms. Liddell and her son are both disabled and live in the house located at 9192 Guss Drive and qualify as low income. She works from home to avoid a difficult transit to and from work each day with a wheel chair and oxygen apparatus. Efforts to qualify for a conventional home loan or equity line of credit, to pay for the needed repairs, have not been successful since her earning power is limited. She has very little disposable income, and the value of her home has been severely diminished due to interior water damage as a result of a roofing design flaw and unabated termite infestation. Ms. Liddell and her son are also in need of handicap modifications, including the remodeling of the existing master and guest bathrooms. To take care of the roof, related roofing components and a portion of the handicap modifications, an initial loan was approved for Ms. Liddell in the amount of $27,500 on March 20, 2008. However, it is estimated that Ms. Liddell will still need an estimated $47,500 in additional loan funds to complete remaining repairs and modifications, as identified in the scope of work detailed in Attachment 4. GRC is also working with a local non-profit organization whose volunteers are willing to provide a portion of labor for the repairs not covered by the additional loan funds being requested. MARGUERITE TAYLOR, 15442 CAPRI CIRCLE Ms. Taylor lives alone in a single-family home that she owns. She is legally blind and has other challenging health issues that require the care of her children 24 hours a day, and she qualifies for the Program as a very-low income household. Among the repairs needed to be done on Ms. Taylor's home are replacement of her wood shingle roof and damaged roofing components; major handicap modifications to her master bathroom and throughout her home; replacement of her unsafe, decaying driveway; and various other repairs. Ms. Taylor qualifies for an initial loan approved in the amount of $27,500. Staff is asking for additional loan funds in the amount of $27,500 since the total cost of Ms. Taylor's repairs is estimated to be $55,000 (See Attachment 5 Scope of Work—Taylor). All loan funds are secured by a promissory note and deed of trust. All repair work is done and overseen by a licensed contractor. The City Building Department will inspect the project if a permit is required. Recent surveys of other cities' loan programs and experience working with the City's Program indicates that the current maximum loan amount may need to be increased to accommodate the rising cost of materials and labor and to attract and retain quality contractors for the Program. Revisions to the Housing Rehabilitation Loan Program guidelines and associated documents will be brought before the City Council for approval at a future date. -3- 4/8/2008 4:36 PM REQUEST FOR CITY COUNCIL ACTION MEETING DATE: 4/21/2008 DEPARTMENT ID NUMBER: ED 08-17 Environmental Status: Not applicable. The Program is environmentally assessed and approved at a Programmatic level as required by the United States Housing and Urban Development Department (HUD). Strategic Plan Goal: Preserve the quality of our neighborhoods, maintain open space, and provide for the preservation of historic neighborhoods. Attachment(s): City Clerk's Page Number No. Description 1. City of Huntington Beach Housing Rehabilitation Loan Program Guidelines Approved by City Council on January 6, 2003, Page 2 "Individual Loan Approval" and "Approval and Revision of Policies and Procedures" 2. Scope of Work- Novin 3. Documentation for $1,850 Emergency Repair Grant Requested for Novin 4. Scope of Work— Liddell 5. Scope of Work- Taylor -4- 4/8/2008 4:36 PM ATTACHMENT #1 Individual Loan Approval Individual loans are evaluated, underwritten, and recommended for approval by staff I embers or an authorized representative of the Economic Development Department, with I inal approval by the Loan Review Committee. Funding limits for an individual loan or grant may be increased with the approval of the Director of Economic Development and/or the City Administrator up to 10% of the stated maximum of the loan or grant, if deemed absolutely necessary. Program Documentation Approval Loan documents are prepared by the Economic Development Department according to master documents approved by the City Attorney's Office. These documents include the Promissory Notes, Deeds of Trust, Truth in Lending Statements, and the Notice of Right to Rescind Transaction. Loan Review Committee There is a standing Loan Review Committee comprised of Economic Development Department employees appointed by the Department Director. The members of this committee have extensive experience and knowledge of real estate lending, real estate transactions, title and escrows. This committee has approval authority for all loans and grants that are recommended by staff. Approval and Revision of Policies and Procedures The policies and procedures contained in this manual are authorized by the City Council and the Redevelopment Agency., Any substantive additions or policy revisions require the approval of the City Council/Redevelopment Agency. Minor corrections or expansion of existing procedures may be made, as necessary, upon the approval of the Director of Economic Development. Financial Privacy Laws Several different laws govern financial privacy rights. These include the California Right to Financial Privacy Act and the Federal Right to Financial Privacy Act, both of which govern the process of releasing a borrower's financial information. Essentially, these regulations allow a lender to disclose a borrower's financial records only upon the receipt of legal process or with the borrower's written authorization. The lender is then required to notify the borrower of the receipt of legal process, unless ordered by the court not to do so. Because credit and application information is not subject to public disclosure to anyone other than the borrower, any request for such information by legal process or by anyone other than the signer of the promissory note is to be referred to the City Attorney's office for disposition. Written requests by the borrower for copies of financial information may be handled directly 2 Introduction ATTACHMENT #2 APR-07-2008 11:52 JK CONSTRUCTION 915 LAKE STREET HUNTINGTON BEACH, CA 92648 Date 9/26/2007 Estimate # 16 MARY NOVIN n work &Uleat HUNTINGTON BEACH, CA 92647 p" OL P.O. # Terms Due Date 9/26/2007 Other Rwg A O EX 150.6�*,' 150.00 FURNISH DUMPSTERS 21 425.001 850-00 REMOVE ROOF COVERING BACK SIDE OF HOUSE 50'X14' 700 0.50 350.00 REMOVE ROOF SHEATHING TO INSTALL RAFTER TAILS & 200 1.00 200.00 BEE HIVE 4'X50' REPAIR RAFTER TAILS BACK SIDE OF HOME WITH 24" 11 750-00. 750.00 OVERHANG INSTALL ROOF SHEATHING & STARTER BOARD AT REAR OF 1 650.00' 650.00 HOME INSTALL NEW ROOFING 30 YEAR SHINGLE BACK SIDE' 700 2.001 1,400.00 INSTALL NEW METAL FLASHING @ CHIMNEY 1 125.00 125.00 DEMO WOOD FRAMING & EXTERIOR PLYWOOD REMOVE ALL 1 975.001 975.00 NAILS & FASTENERS @ BACK OF HOME SLIDING PATIO DOOR 6' LOW -E 1 0.00! 1,600.00 INSTALL NEW VINYL DUAL GLAZE LOW-E NAIL ON WINDOWS j !j 2,000.00 2,000.00 @ BACKSIDE OF HOME BEDROOMS TO MEET EGRESS STUCCO EXTERIOR BACKSIDE OF HOME 1 J 2,650.00: 2,650.00 GENERAL CARPENTRY REPAIRS @ BACKSIDE OF HOME 1 I 2,950-00 2,950.00 FINISHING ,KITCHEN,REPAIRS,BATH, INTERIOR 150.001 150-00 REPLACE MISSING DRYWALL TAPE & PREP FOR PAINT 11 2.900.00: 2,900.00 APPROX. 1600SF Subtotal Sales Tax (0.0%) Tota I JK CONSTRUCTION jrnck1nfsh002@socaI.mcom 714-960-7052 Fax 714-S36-3878 Page 1 APR-07-2008 11:39 P.02 APR-07-2008 11:52 JK CONSTRUCTION 915 LAKE STREET HUNTINGTON BEACH, CA 92648 Date 9/26/2007 Estimate # 16 MARY NOVIN HUNTINGTON BEACH, CA 92647 P.O. # Terms Due Date 9/26/2007 Other n: gg F`N�11 n z' "REPAIR INTERIOR ELECTRICAL----KITCHEN---BATH--- BACK 11 2,500.00 i 2,500.00 WALL OF HOME---LITE FIXTURES--CEILING FIXTURES,CAN LIGHTING.GFCI, INSTALL NEW INTERIOR DOORS & JAMBS AS NECESSARY 4 240.001 960.00 WITH HARDWARE INSTALL NEW 12"X12" CERAMIC TILE KITCHEN,GUEST BATH J ; 2,150.00; 2,150.00 R/I TOILET WITH NEW SEAL INSTALL HOMEOWNERS EXISTING LAMINATE FLOORING IN 600! 3.001 1,800.00 FRONTROOM,DINNING ROOM,MSTR BED, PREP FLOORS,INSTALL UNDERLAYMENT INSTALL 3/4" BASE . 3001 2.25 i 675.00 REMOVE ALL MISC. DEBRI ,LAMINATE FLOORING FOR MOVE 1 500.00 i 500.00 IN CONDITION PROTECT LAMINATE FLOORING I OBTAIN & FURNISH PERMITS & INPECTIONS 1 450.00: 450.00 NOTESI CONTRACTOR SHALL USE ANY SALVAGEABLE LUMBER, DRYWALL,BUILDING MATERIALS THAT ARE ON JOB SITE TO MAKE NECESSARY REPAIRS INCLUDING LAMINATE FLOORING AT THIS ADDRESS TO KEEP BUILDING COSTS TO A MININUM Subtotal Sales Tax (0.0%) Total JK CONSTRUCTION jmcklnlsh002@socal.rr.com 714-960-7952 Fax 714-536-3878 Page 2 APR-07-200e 11:40 P.03 ATTACHMENT #5 Project Budget Summary Marguerite Taylor Items Covered in 15442 Capri Circle, Huntington Beach, CA 92648 Initial Loan 1 Roof (30 Year Asphalt Shingle plus radiant barrier) $9,500.00 9,500.00 2 Water Heater Safety 950.00 950.00 3 Fumigation 1,800.00 0.00 4 Smoke Detectors 150.00 5 Exterior Wood Damage & Paint 2,700.00 2,700.00 6 Walk & Driveway 4,800.00 7 Rear Door 600.00 600.00 8 Windows & SLGL 6,500.00 9 Master Bath (add handicap features) 10,000.00 10,000.00 10 Guest Bath 7,500.00 11 Electrical Repairs and up-dates 1,300.00 1,300.00 12 Electrical Service 1,800.00 Sub Total 47,600.00 25,050.00 Permits $500.00 Contingency $6,900.00 $2,460.00 $27,500.00 Initial Loan Amount Final Loan Amount Needed $55,000.00 Final Loan Amount Less Initial Loan Amount $27,500.00 RCA ROUTING SHEET INITIATING DEPARTMENT: Economic Development Department SUBJECT: Authorize Increase of Maximum Loan Amount for Three Housing Rehabilitation Loans (Novin/Liddell/Taylor) COUNCIL MEETING DATE: April 21, 2008 RCA ATTACHMENTS STATUS Ordinance (w/exhibits & legislative draft if applicable) Attached ❑ Not Applicable Resolution (w/exhibits & legislative draft if applicable) Attached ❑ Not Applicable Tract Map, Location Map and/or other Exhibits Attached ❑ Not Applicable Contract/Agreement (w/exhibits if applicable) Attached ❑ (Signed in full by the City Attorne ) Not Applicable Subleases, Third Party Agreements, etc. Attached ❑ (Approved as to form by City Attorney) Not Applicable Certificates of Insurance (Approved by the City Attorney) Attached El Not Applicable Fiscal Impact Statement (Unbudgeted, over $5,000) Attached ❑ Not Applicable Bonds (If applicable) Attached ❑ Not Applicable Staff Report (if applicable) Attached Not Applicable ❑ Commission, Board or Committee Report (If applicable) Attached ❑ Not Applicable Findings/Conditions for Approval and/or Denial Attached ❑ Not Applicable EXPLANATION FOR MISSING ATTACHMENTS REVIEWED RETURNED FO ED Administrative Staff Assistant City Administrator (Initial) ( ) ( ) City Administrator (Initial) ( ) ( ) City Clerk EXPLANATION FOR RETURN OF ITEM: (Below Space For City Clerk's Use Only) RCA Author: Terri King X8831