Chapter 3.36
HOUSING REHABILITATION FUNDS
Sections:
3.36.020 Competitions for funds--Preapplication.
3.36.050 Refinancing criteria.
3.36.060 Application criteria.
3.36.010 Purpose.
A. The purpose and intent of this policy is to establish priorities and guidelines for the reuse of community development block grant (CDBG) and housing rehab funds which are returned to the city through loan paybacks.
B. It is recognized the city has great latitude in reusing these funds and certain rules and priorities must be established to better justify our actions and to better assure that fairness of judgments are made. (Ord. 1024 §1-(part), 1988)
3.36.020 Competitions for funds--Preapplication.
Preapplication eligibility must be established, and must include all the following requirements:
A. Housing rehabilitation is the basic purpose of these funds and housing will be given a priority over commercial or industrial use.
B. These funds are prioritized for low and moderate income homeowners with repair needs in the following categories: First to correct health and safety hazards. Second to enhance energy conservation and last to provide modernization work. Below are representations of the types of work which these funds will be used for:
1. Health and safety hazards include the following types of work:
a. Electrical,
b. Plumbing,
c. Ventilation,
d. Handicapped access;
2. Energy conservation includes the following:
a. Insulation, blown-in,
b. Thermopane/storm window,
c. Heating systems;
3. Modernization includes elimination of inconveniences including: room size remodeling.
C. Rental units for low and moderate income renters are prioritized next with agreements that rental rates shall not occur for five years or more because of the improvements made by these funds.
D. In any use of these funds, all of the civil rights and fair housing commitments agreed to by the city shall prevail.
E. Returned funds may be used as gap closing, leveraging funds in economic development projects, or in other economic developments strategies approved by the city council.
F. Total amount available per loan shall be four thousand dollars. The loan money shall correct the stated problem in its entirety or no funds shall be loaned. (Ord. 1024 §1(part), 1988)
3.36.030 Additional funds.
All loan requests shall be required to use cooperative financing to leverage additional funds. A project must have been rejected from all local banks for cooperative funding at reasonable interest rates in the amount requested, for the city to consider utilizing only city housing rehabilitation moneys for the rehabilitation. (Ord. 1024 §1(part), 1988)
3.36.040 Lending criteria.
Loans shall only be made if the total indebtedness of the house is equal to or less than ninety percent of the assessed value of the home as determined by the county tax assessor’s office records. (Ord. 1024 §1(part), 1988)
3.36.050 Refinancing criteria.
A. Existing rehabilitation loans shall only be refinanced if the following conditions are met:
1. There are no arrears or penalty payments outstanding on the loan;
2. The current loan is to be retired through higher interest rates or shorter term;
3. There is a greater opportunity for the loan to be paid back as a result of refinancing;
4. There is a financially sound reason for the city to grant a refinancing.
B. The above guidelines will be used by the mayor or his designee and city staff to process and approve an application for housing assistance from the city pending review and approval by the city council. (Ord. 1161 (part), 1995: Ord. 1024 §1(part), 1988)
3.36.060 Application criteria.
A. Once the preapplications have met the threshold requirements, the application can be further processed with all good standard banking practices observed. The city will utilize the standard housing rehabilitation contract documents.
B. Upon completion of application, the mayor or his designee and staff will process the request per the above guidelines and submit the request to the council for final approval of the loan at the next regularly scheduled council meeting. (Ord. 1161 (part), 1995: Ord. 1024 §1(part), 1988)