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88-251 WMITE - CITY CLERK PINK - FINANCE �� CANARY - DEPARTMENT GITY OF SAINT PALTL COIIIICI �v��/ BLUE - MAVOR File NO• � City Attny/RSH . Council Resolution �a Presented By ��''�? Referred To Committee: Date Out of Commi tee By Date RESOLUTION AUTHORIZING THE CITY TO ACT AS AGENT FOR RAMSEY COUNTY IN IMPLEMENTATION OF CDBG HOUSING REHABILITATION PROGRAM AND EXECUTION OF JOINT POWERS AGREEMENT THEREFOR WHE EAS , the County of Ramsey is a political subdivision of the State of Minnesota, and the City of St. Paul i� a municipal corporation and home rule charter city, each as specified in M.S . §471 . 59 ; and WHE AS , the County of Ramsey ("County") has requested the assistan e and participation of the City of St . Paul ("City") in • implemen ing a Housing Rehabilitation Loan Program ("Program") for municipa ities (other than St. Paul) in Ramsey County; and WHE AS , the City currently implements a housing rehabilitation loan pro ram utilizing community development block grant �funds , and has the ecessary personnel and expertise to act on behalf of the County i the implementation of the County' s Program. NOW THEREFORE, be it resolved as follows : l . The City of St. Paul , by and through its Department of Pla ning and Economic Development is authorized to act as ag,e t on behalf of the County of Ramsey in the implemen- tat on of a Housing Rehabilitation Loan Program. 2. The terms and conditions of the Agreement between the Cou ty and the City shall be specified in a Joint Powers Agr ement, which Agreement is approved for execution, in te s and conditions satisfactory to the City Attorney, by the City. COUNCIL MEMBERS Requested by Department of: Yeas Na s Dimond � �� p? , �ng [n Favor Goswitz _ Rettman �$Y g r��. � scne;n�� _ Against y �se�� 5tsen Adopted by Council: Date FEB 2 3 1� Form Approved by City Attorney Certified Pas e u cil Se ry BY ��"'' By Approve Mavor: D _ ED � � 1�t7� Approve y Mayo r Submission to Council _ � - �.t�z_1%�� By �Y PUBUSNED h�AR - 5 196g C uncii Research Center �� - ,'�"' ^ FEB 121988 1y° 013164 • DEPARTMENT . - - - - — - • CONTACT Nl1ZIBS PHONE � O DATE . � � �O� ROUTING ORDER: (See reverse side.) � �Departmen Director Mayor (or Assistant) _ Finance a lrtanagement Services Director � City Clerk _ Budget Di ctor .�� _ City Atto ey ., �, G G : � (Clip 1 location € signature.) T G C IO THE ? <Purpose/Rationale) p o� •i�+wt �c� �a rreK wi�� 1 ��a � c�� w Ra�ssY t� -�o � �rKc► � �«�r ��`� �� A �.ew �r�tfr Gt,rY -�b urcPuit�A•�, N �1t1�1,� r+F"h�+E 8•e�*�'Y, �► iMi R�1+�� ►et P��oi�• ke1�4 w��.�. �i T'�►ow�+r�Q-T++�te�i.µ Ir•�►tr1e�l�1f GG�t��'Y Cv15is �rRAM�• OST U G T Y ND P R 0 I CT �T� wi�.V t�Ce�•s1us�'�s,sao F� Ra�t�r Cow�t�Y 't�+ �tPt�µ� '�� . o l�t'�o tttoN�t. Gas"t'�`�lat�� 1,,��1.1. '6!` lR�utR�D. FI N T A T V TY ER C 0 C I ED: (Mayor's si ture not required if under $10, 00.) Total Amoun of Trans�ction: Activity Number: Funding So ce: . AT'PA�BNTS: (List and number all attachment .) . �„ O��D �.OKiJGt4 � /01"� � Rp6RAM ful0��►� . ADIrt STRA P OC D ES _Yes o Rules, Regulations, Proced �s, or Budget Amendment required? Yss o If yes, are they or timeta le attached? DEPAR V W - CITY !,�'�'I'ORNEY REVIHW �Yes _Lo Council resolution required? Resolut'ion requiredY �Xes �No Yes o Insurance required? Insurance sufficient? �Y�,?��No _Yes � o Insurance attached? �{.�' � �;.. � . _ . �� ; � ��F -�S/ . R EHABILITATION DEFERRED LOAN PROGRAM GUtDELiNES COUNTY OF RAMSEY DEPARTMENT OF COMMUNITY APO ECONOMIC OEVELOPMENT ROOM 354 C I TY AI� COUt�(TY COURTHOUSE SAINT PAUL, MINNESOTA 55102 December 16, 1987 : : ��1 � , TABLE OF CONTEIYTS i. PURPOSE....... . .............................................. 1 Ii. OPERATION...... ...... ........................................ 1 ill. DEFiNITIONS... ............................................... t Accessibility improvements.................................. . 1 Applicant.. ................................................. . 1 Assets..... . ......... ........................................ 1 Borrower....:........ ........................................ 1 Dxelling Unit................................................ 1 Eliglble Improvements........................................ 2 Gross Annuai Income.......................................... 2 Hardship.......... ... ................................. .... .. . 2 Health and Safety Hazards.................................. . . 2 Owner-Occupant.............................................. . 2 Princtpal Residence.......................................... 2 Renter....................................................... 2 Resident............. ........................................ 2 . IV. GEf�RAI POLICtES............................................. 2 intent....... ... .... . ........... ........................... ... 2 Hardship Cases........................................ .... . .. . 3 Denial of a Loan.............................................. 3 Eligible Properties........................................... 3 � Property Ownershlp Requirements............................... 3 Gross Annuai Income Determi�ation.......................... .. . 3 - -i- . , . . G'�or?.�l V. REHABIIITATION DEFERREO LOAN PROGRAM............��.....�.�.,.. 3 A. Eltglble Improvements...................................... 3-4 B. tncome Et (glbiltty................... .................. .... 4 C. Asset Ltmttation........................................... 4 0. Loan Terms................................................. 4 Appendi "A".. ....... . ... .... .......�.......... ., �..Other General Policies Appendl "B"......... .... ......... . .. .... Immediate Health b Safety Hazards , -it- ' , . � , ��-:�Sl REHABILITATION DEFERRED PAYMERIT LOAN PROGRAM i . URPOSE o promote affordable residenttal rehabliltatlon to make it possible for ow income homeowners _to maintain and improve their homes. II. PERATlON . The Depa�tment of Community and Economic Development wtll administer the programs. Ali t�ansactions required by these guideltnes will be executed by Ramsey County. The County has the sole �ight to review, approve and amend these guldeiines. . It ts the inte�t of this program that repayment of {oan funds Mili be deposited i�to the pro��am account to be used again for loan capitai . 111. EFlNITIONS s�s�1�111tx..lmRtQYSm�nts Accessibility Imp�ovement" means an interior or exterio� improvement or dificatTon to a �esidential Property which is necessa�y to enable the isabled pe�son to functlon In that residential setting. �11s�Dt � � Appiicant" means one who makes npplicatlon for a Loan. �.�8f5 Assets" means the cash value of assets exclusive of the st�ucfiure to be mproved, held by all Residents of the household. The cash value is efined as the current market value of the item mTnus the existtng ndebtedness on that item. LL�I��L Borrower" means one or more persons rho appiy for and receive a Loan in onformance wlth the requlrements of the guldellnes. s11,�II�1JIIlt Dwel_ ITng Unit" means a housing unit that inctudes self-contained ooktng, sleeping and bath�oom facilities. j . , T` � . � _ � T'. � � �s� E 1a1�l�Rt�Ygm�nfs " Ilgtble Improvements" means �epai�s, �rehabilitation, �econstructlon, c nversions, modernizatton, �eptacement, remodeltng, alterations or i p�ovements to eligtble properttes as set forth Tn the "Eligible i provements" section of these guidellnes. � s_8nnu�l�nt.�m� " ross Annual incone" means the current Income f�om ail sources and b fore taxes and wlthholding of all Residents of the househoid. �sh� " ardship" means those exceptional cTrcumstances which rarrant appeal to t e Director of Community and Economlc Devetopment. . Bltt�nn�f�fx�z�r� " ealth and Safety Hazards" means those violattons of applicable codes r (ch endangers the heaith and safety of oc�upants of the building t votved. Q n�r=4s�uRnnt " wner-Occupant" means persons or families xho are the fee owne�s or c nt�act for deed purchasers of eligible properttes and who occupy and h mestead such property. n�1R�l_B��l��ns� " r 1 nc I pa I Res t dence" means the pt-operty wh ich the BorroKer regu i ar I y cupies as a �esidence and in which the Bo��ower resldes at the ttme of ' a plicatlon for a Loan texcept Mhe�e extraordinary cTrcumstances have m de the property temporarily uninhabitable). IItSL . " enter" means a bona fide tenant who wouid not normally be allowed to r side in the dweliing without paying �ent. ��SIIf " esident" means a person, other than a renter, living in the househoid a pe�son rho is ciaimed as a dependent for income tax purposes. IV. G t�RAL POLICIES j tg� - The purpose of the program is to make it possible for low I come owners to rehabtiitate thel� homes. The Rehabititatfon Deferred L an P�ogram has been designed to facilitate this goal . . -2- . . � . � � ; - _ ��s�--a�� L�Sb1t2_�H�g� � Where a�tuei hardsh(p can be demonstrated, the Di�ector f Community and Economic Development may walve the usual p�ocedu�es. II1D1_Qf�LLStHD - Rehab i I ttat lon ass istance shou I d be den ied on I y Khen: a. the appiicant does not meet the program guideltnes b. the structure is to be purchased by the City, County, or State c. the cost of the �ehabititation is not economicaily feasible 1151�18�L�t�Pt�1S.5 - To be el ig ib le for �ehab i i ttat ion ass istance, a roperty must: a. be located ln suburban Ramsey County; b. De owne�-occupled as the principa) residence of the appticant; c. co�tain no more than 4 residentiai untts; d. conform to use under the municipality�s Zoning Ordtnance; Administrator wili contact indivldual municlpaltty to confirm - zoning compliance after pre-approvai; eath municipality shall reserve the right to walve; e. be insurabie through a pubiic or prlvate insurance p�ogram after rehabilttation; f. have Its own legal description. � � ' �Y_Q1dIISL�hl�B�A11��IIt� - The appi tcants must ind iv iduai t y, or In aggregate, have a qualifying interest in the property, consisting of t least one of the tollowing: a. a vai id i ife estate. -Such I ife estate must be recorded and must appear In the records of the County Reco�der�s Office; . b. Fee ownership. Such lnterest may be subJect to a mortgage; c. Purchaser in a contract for deed with respect to the structure betng improved. Such contract for deed must be reco�ded and must appear tn the �ecords of the County Recorder�s Offtce. 11 individuals occupying the property to be Improved as their princtpal lace of resid ence and having an ownership Interest In the property, ust �oln tn the applicatJon. tQS�.AnIIU�1��Q¢��etst�l�et1QII - Curren1 tncome from all sources and efore taxes and withhoiding of all residents. here spouses are separated, the income of the non-resident spouse must e tnciuded in the caiculation of gross annuai Income uniess a separate alntenance agreement ts in force. In such cases, the separate alntenance agreement shail be counted as income, and then the income of he non-resident spouse may be excluded. V. EHABILITATION DEFERRED LOAN PROGRAM . E11�.i�..1��tQYSm��t� 1. AII (mprovements must be permanent tmprovements which: . -3- �.: � • - /yL�-��V?�7 l.A a. constst of alte�atlons, �enovations, or repalrs b. are in connectlon Mlth an exlsting st�ucture c. correct a defect or deflclency In the property affecting directly the �ealth, safety, habttability, accessibiitty or energy efficlency of the property d. do not include materials, flxtures, o� landscaptng of a type or qua{ Ity exceeding those generaily used for the same general type of property.. Unde� no condittons can generai tmprovements or othe� costs be inciuded In the Deferred Loan. The most serious Health 3 Safety defictencies denoted by an asterisk on the attached ilst (Appendix "B") ,must be corrected prto� to utilization of funds fo� other deflclencies. The funding of imp�ovements sta�ted before the Issuance of a P�oceed O�der are ineligible. AI1 improvements must be deemed to be economicaily feasible as determined by the staff. - • 1fl�Qm�_Ella1�111tx . Eligible applicants are persons or famtites of low Income whose annual gross income does not exceed 50� of the MSA, �dJusted for household size, as determined by the Department of Housing b Urban Development. • �s�L.IIDl�tl� The sum of the cash value of ail assets of all Residents of the household cannot exceed 525,000. Assets whtch produce incorr� must be verified to insure that the total household income rematns within the ellgibility �equirements. • L��n T� e�n� The amount of the deferred payment loan shali be the tesser of: a. 512,000 . b. The actual cost of eltgibie improvements. Record(ng fees are an eliglble cost ��ur1tX A Repayment Note and Mortgage Llen ts requlred on ali properties being Improved. No fnterest or perlodic payments are requlred, but the Rehabilttation Defe�red Loan must be repatd in the event the property Is sold, transferred, or otherwise conveyed, o� ceases to be the borrower�s� principal place of residence within ten years of the date of the loan. Principal amount wtll decrease at the rate of 10$ per year for 10 years. Thereby, totally forgiven after the tenth year. • -4- � . ' (.��°l� APPENDIX "A" BEl .[p�fQ_b�y.�jD�_�Q�� - Rehabilltation program impiementatlon and code enfo cement practice should be mutually supportive. Enforcement of the munl ipality�s houstng maintenance code, Certificnte of Occupancy and vacant bu 11 ing ord inances when app I Icab l e shou I d be coord i-nated w 1 th i ts reha I 1 Itat ion and nelghborhood improvement efforts. AI I contractors perf ming work for this Program must be licensed by the muntcipallty in which the x rk is performed. � Q�B �LY1��5 - Technical assistance--help in determining rehabll itation needs• spec wrTting, deaiing with contractors, and inspection servtces. 81ah t�E1�.�G131_PL,jy�Ly�� - The Department of Hous i ng and Urban Deve I opment has the r ight of access to any f I nanc 1 a I reco�ds he 1 d by a flnan la! i�stitutlon In connection xTth the administration of the Commurrit y Devel pment Btock G�ant Rehabtlitation Loan Prog�am. Fina ctal reco�ds involving loan transactions M111 be avallable to the Depa tment of Housing and Urban Development rlthout furthe� nottce or autho tzatlon of the appiicant. However, financ(ai lnformatlon rill not be disclosed or released to anothe� gove�nme�t agency o� department without w�1tt n consent of the appltcant except as requi�ed or permitted by law. �� ..PLH��..8� - The Minnesota Government Data Pract Ices Act requi es that persons be tnformed of the use and purpose of data required of them. The information �equested on the appiicatlon form and any verifications or d umentation requested are necessary to determtne e1 lgtb I i lty for a loan or a �ant. Thts (nfo�matlon must be dtsclosed or an application cannot be p�xe sed. Descriptions of common sources of Income and approp� late methods of -caicu ating tncome follow. lt� �$tstmt�.at1� A• �QUrSB�f�II��_tQl��lu�� Gross annua I i ncome Inc I udes sa i ary; commissions; bonuses; interest d (vidends; tips; gatns or sales of securities; a�nulties; penslon; farm �ental ; partnership, estate or trust income; child support payments; alimony; sorial secur(ty; and miscellaneous Jncome. B• QLmal_.4x$Lf1IDS may be determined through contacting an employer and/or evlewing year-to-date salary informatton on a pay stub cr employment erificatlon form. The amount may be based on prior years� flgures or verage amounts awarded to other employees rith the same status. �• LQ.IS�fB�QD�15 �y be determ t ned through contacfi i ng the emp I oyer. The _ mbunt may be based on previous years ftgures or average amounts awarded 0 othe� empioyees Mith the same status. . ��°7� : �• �tCII5��1IInuIIL1nGIIID�LL��5S1.��S��21Qy�Dt 1s the net prof tt from said seif-employment as declared by the Appl icant (n Schedule C; Ff or E, Part tll, as appropriate, of t�e United States Internaf Revenue Se�vice Form 1040, or any other schedu le the I RS may promu i gate. ALL DEPRECIATION ts to be Included as income. 1�ELS�n�ltDLf��L5b.1A��S15#5, the app I y t ng pa�tner�s percentage of net p�ofit and depreclation must be Inciuded from the U.S. Pa�tne�ship ' Return of Income, Form 1065. lf`n�QU��l�..Q�m�BL_�,cDS�I_Smnll..@lt�1DS5��L�QL�ltl�n, net prof(t and depreciation must be included from the U.S. Smali Bustness i�come Tax Return, Form 1120S. Where income Is derived from self-empioyment, gross annual income from each business should be calculated for each of the two most recent tax years and averaged to obtain a p�oJected gross annual income from which the Borrorer�s eiig(bility and interest rate if app•Itcable, Mill be determined. N�#��b85$�s�tt��: - If the nature of the business has changed substantialiy, or lf the buslness has not been In operation for a full two years, a two-year average is not appropriate. An appropr(ate method will be considered case by case. - If the calculation of gross annual income from a business is a negative number, thts loss may not be deducted from other sources. E• lII�D��fLQID�II��tL�8tt1,� shai l be included in gross annual Income. Expenses allocated to Rental Dweiling Units may be deducted from rental income received f�om these units. Expenses allowable for deduction include rtbrtgage Interest payments, utllittes, taxes, Insurance, and maintenance. F• �DYIDBD��fLQm».�D�tL��.;,fQL��t2L��SCty sales are to be consldered as income. This income will be reduced by regularly scheduled out-of- pocket expenses the applicant has in connection w(th the property being sold, Including mortgage o� cont�act-for-deed princlpal a�d Tnterest payments. �• mRl�t�SD��IDRBII.�Dt�� - If unemployment is ��gQ�j and ��r.�, on a flll1�L��,5i, gross annual income shai l include the sum of rages and unemployment compensation minus any employee business expenses, except depreclatlon, that may be �eported on Fede�al Tax Form 2106. Generaliy ross annual income from seasonal empt=oyment/unemployment shall be aiculated by averaging lnccme and expenses f�om the two most recent tax years. However, If the employment has changed considerably over the least two years, it is permisslble to utll ize an employer�s proJection f Mages, along rith a p�o�ectlon of unemployment compensatton. mployee business expenses may not be pro�ected. .., �: f , � - . , . _ �� ¢�RQLnLY_DQ�LS�uCL1�a reductlon of Income of known duration, such as that caused by layoffs, maternity leave,. sabbatical leave, etc. may not be consTdered rAen caiculating gross annual income. Rather, income shall be calculated based on the normal annual income of the temporarily unemployed person. _ , Appllcatlons of those who are unemployed for an y��g�� shall not be conside�ed unttl the unemployed household member has exhausted all e! (gibi( tty for unemployment compensatlon and the employer indlcates a caliback date is unknown. 1D�Q L1f1sD�D - �II sou�ces of tncome must be disclosed by the appiicant and st be ver 1 f ted. 1 f an app I lcant is requ 1 red to f( i e a tax return w ith the I ternai Revenue Servfce, a copy of the two most recent returns ts requl ed in the loan ftle. The foilowing Is a list of acceptable forms ot inco verificatton evidence: a. rrltten verification from employe�s or other income provlders b. coples of soclal secu�ity checks c. copies of current check stubs d. income derived from rent must be verlfted by a xritten statement by the renter, or by examining coples of checks or �ent receipts e. statements f�om banks o� othe� financlal institutions The d te of the document used tn verTfying income may not be more than 90 days prevt us to the date of loan ciosi�g. I.Ifl @C1f1�B�� - The following Information from the County Recorder or Regis er of Titles regarding each property must be obtained: - the fuli names of all owners of record, including tirst name, last name, middle name or iniflal and any addttional names whlch may appear in the records, such as malden names. - a determination of the system under rhtch the property Is recorded, eTther Torrens o� Abstract. - the complete Legal Description of the prope�ty to be tmpraved. - the document number, book, and pages of the recorded deed. - the current estimated market value of the property to be Improved as determined by the county assessor. - the amount and status of property taxes due. - -3- . _ . _ _ - ��r APPENDIX "B" lID�d DtS..dBDlfb_d_SHfStY_dHZnC�S means those v io!at tons of app I Icab 1 e codes whlch materlally and immedtately endanger the heaith and safety of occupants of th build)ng involved. Such vlolattons include but a�e not Iimited to: A• tISD�II�ySfH�� that nre unsafe due to: *1. Bu�ned out or rusted heat exchanger *2. Burned out or plugged tlue �3. Not vented or improperiy vented *4. Connected with unsafe gas suppites 5. Gas or oll—fired systems that are not burning properly (colo� of flame Mil1 be clue) 6. A11 gas or oi ! burners more than ten years old wil ! require a servtce cail for cleanJng and adJustment and controi check. B• ��L�1g�L� that a�e unsafe due to: ' �1. Burned out or �ustea out heat exchangers (flre box) *2. Unvented ' *3. Connected with unsafe gas supplles *4. Lack of temperature and p�essure rellef vatves �• El@�3L1�a1�y�� that are unsafe due to: �1. Dangerous overloading 2. Damaged or deteriorated equlpment 3. Improperly tapped or spliced wiring �4. Exposed uninsulated wires 5. Dlstributfon systems of extension cords or other temporary methods 6. Ungrounded systems -7. Ungrounded appliances i� contact vith earth 8. A11 obvtousiy �azardous, improper and/or iliegal wiring shali be removed *9. Overfused distrlbutlon circuTts �• P.l�QJ�lII�ySfB� that are unsanftary due to: � �1 . Leaking waste systems, fixtures and traps, siphontng traps +�2. Cross connection of pure water supply with t.ixtures or sewage Itnes 3. Water service wili need repatr if pipe and fittings In meter connectlon are badly dete�lorated o� leak(ng 4. Water distributJon plping Mill need �epatr it badly deterlorated or leak ing �tndt ates most serious Health d Safety Hazards; these items requlre immed ate co�rection „ _ _ ^ _ _ : - � ��a� � 5. Gas plping M111 need repatr if: *a. illega! ptping Mhlch could be dangerous (copper with compresston f{tttngs, coppe� wtth soft solder Joints, unapproved ptastics, c�st iron fittings on steel p(pe, concealed unions, copper Joints) b. unsupported or sagging piping c. tacking a level handle valve Installed between house pipe and flexible connector �6. Waste and vent Mitl need repair If there a�e: a. open hubs or fittings tincludes hubs o� fittings plugged with concrete, etc.) b. broken o� �otted raste or vent pipes c. plugged or nonfunctioning waste system *7. Floor draJns will need repat� tf there are: a. missing or broken strainers +�b. missing cleanrout plugs 8. Clean-onts rilf have: a. at least one accessible clean-out for building draln - �b. cteanrout plugs Intact and ttght 9. Wate� heate� Mill need �epaJ� If there is: (see water heate�) a. sp111age of p�oducts of combustion at dtverter b. deter ioroted vent p ip ing � c. back pitched ve�t piptng d. unde�slzed vent (either smaller than diverter out{et or because of excessive length) e. piugged flue passages th�ough heaters f. unapproved temperature pressure rel (ef vaive g. over f I r t ng 10. Water closets wiil need repai� If: a. bowl is loose on floor *b. c�acked or excessive Iimed bowl c. unvented tn places rhe�e this may cause problems when other fixtures are used 11. Bathtubs �tll need repair If: (see plumbtng) a. trop is i eak i ng or taped b. waste and ove�flor leaking, taped or parts missing - c. ftxture dete�iorated or chipped to a degree of becoming unsanitary or exposing sharp edges � d. trap not vented 12. Sink and lavatory vili need repair lf: a. ffxtu�e is deteriorated or chipped to a po(nt of becoming unsanitary and dange�ous ' b. trap and exposed pipe and tubing taped or teaking *c. crown vent dtsconnected or abandoned *d. traps siphoning for lack of vent 13. Laundry trays connected to wate� source wtll need a properly installed waste, trap and vent . *Ind cates most serious Health b Safety Hezardss these items "requlre” imm diate correctlon . -2- . ,_. . _ , �-�as� . p 14. Bathroom ventilation: a. rindow or mechanical ventilatlort must be provided 1S. Addltional basic fixtu�es for dwelling units wil ! be needed tf there Is: a. lack of basic fixtures as requl�ed in Housing Code *E• LYL�uCIIL�y�fgID.�, walls, chimneys, �oofs, foundatlons, ceilings and floor systems that wtli not safely carry imposed toads ( i.e., �emoved posts, deteriorated ioose post base, overspanned memDe�s). *F• 8��@..,�Z��, human waste, decaying verm(n o� other dead animals, animal waste, other materiais rendering It unsanitary for human occupancy. . �Ind cates most serlous Health b Safety Hazards: these ttems "requi�e". I d late co�rect lon - -3-