HomeMy WebLinkAboutContract 43983 (2)CITY SECRtIARY �g �^
CONTRACT N09 a
AGREEMENT TO TERMINATE
FINANCIAL ASSISTANCE AWARD FOR CONVENIENCE
EDA Project No.: 08-39-02250
WHEREAS, the United States Department of Commerce, Economic Development
Administration (hereinafter, "EDA" or the "Government"), pursuant to its authority under the Public
Works and Economic Development Act of 1965 (42 U.S.C. § 3121 et seq.), as amended,
Awarded the City of Fort Worth, Texas, (hereinafter the "City"), a financial assistance grant, EDA Project
No. 08-39-02250 (hereinafter the "Grant"), on September 30, 1980, to establish a Revolving Loan Fund
("RLF"); and
WHEREAS, the EDA RLF Grant Award of $1,000,000 was initially matched with $490,000
from the City's HUD Community Development Block Grant, of which $64,414 was subsequently
diverted for use as administrative expenses without prior EDA approval, and the RLF Total Project Cost
was correspondingly reduced by $64,414, the current Federal Share of the EDA RLF represents 70% of
the current total project cost of $1,425,586; and
WHEREAS, the City notified EDA in a letter of May 15, 2006, that it had suspended its RLF
program at the request of HUD, and that in accordance with instructions from HUD the City is collecting
repayments of the remaining loans and booking those RLF funds as program income in its CDBG line of
credit; and
WHEREAS, after discussions with the City regarding termination for Convenience EDA wrote
the City on May 14, 2008, requesting that the City submit a written request for termination for
convenience of the EDA RLF; and
WHEREAS, on June 10, 2008, the City wrote that it was in the process of gathering information
to request termination of the EDA RLF grant but did not pursue termination in a timely manner; and
WHEREAS, due to the City's lack of performance and non-compliance with the EDA RLF Grant
Award, a termination for convenience in whole is recommended in accordance with 15 C.F.R. § 24.44 of
the Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local
Governments; and
WHEREAS, the City reported that as of September 30, 2012, the Current RLF Capital Base
totaled $827,933.35; and
WHEREAS, the amount to be recovered by the Government is equal to $579,553.35 or 70% of
the RLF capital base of $827,933.35; and
WHEREAS, the amount of $579,553.35 shall be remitted in full, within 30 calendar days of the
date of this Agreement to Terminate to:
The Economic Development Administration
Office of Financial and Management Services
Accounting Team
Room 7217
1401 Constitution Avenue, NW
Washington, DC 20230
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NOW THEREFORE, for and in consideration of the premises and for the mutual benefit and
convenience of the parties, the Government hereby tenders this Agreement to Terminate, effective on the
date signed by all parties. The effectiveness of this Agreement to Terminate ceases all Federal obligations
to the City of Fort Worth under the Grant.
Acceptance of this Agreement to Terminate must be made by the City of Fort Worth and returned to the
EDA on or before December 28, 2012.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to Terminate Financial
Assistance Award for Convenience to be duly executed by their respective officers as of the date
indicated.
DEPARTMENT OF COMMERCE
ECONOMIC DEVELOPMENT ADMINISTRATION
By:
Pedr&Jij Garza, Regional Director
Austin Regional Office
City of Fort Worth, Texas
By:
Attested by;
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Mary J. Ka%
-77/44•••.4H
(Signature)
te 024 A YIP° Coostifr-
Tinted Name)
Isla ■ ■ 1 1 Ia
11�2giz
(Date)
APPROVED AS TO FORM A D
CITY ATTORNEY
Ctsat.
(Title of Accepting Official)
/24 3At.
(Date)
RTIFICATION (By Official other than Accepting Official)
EGALITY:
The person signing this Acceptance and Certification is so authorized by the Government Body or Board
of the City.
By:
.iiC
(Sigtur
fly' ---f/airic
(Printed Name)
,oO� *stirstraicoviietvEttr�o0
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o°�- (Date)
'kiree
rtifying Official
1,
City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 12/11/2012 - Ordinance No. 20521-12-2012
DATE: Tuesday, December 11, 2012
LOG NAME: 17EDA
SUBJECT:
REFERENCE NO.: **G-17757
Authorize Execution of an Agreement with the Economic Development Administration for the Termination
of the City's Revolving Loan Fund Program Authorize Payment in the Amount of $579,553.35 and Adopt
Appropriation Ordinance (ALL COUNCIL DISTRICTS)
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize the City Manager or his designee to execute an Agreement with the Economic Development
Administration to terminate the grant for the City's Revolving Loan Fund Program for business
development in neighborhood revitalization areas;
2. Authorize the payment in the amount of $579,553.35 to the Economic Development Administration to
close out the grant; and
3. Adopt the attached appropriation ordinance increasing the estimated receipts and appropriations in the
Grants Fund in the amount of $486,321 45
DISCUSSION:
The City was awarded an Economic Development Administration (EDA) grant in 1980 to establish a
Revolving Loan Fund (RLF) program to make loans to businesses willing to locate in certain neighborhood
revitalization areas The businesses were to provide economic revitalization in the targeted areas by
providing jobs to low-income residents The EDA grant provided an award in the amount of $1,000,000.00
which was matched with the amount of $490,000.00 from the City's Community Development Block Grant
(CDBG) funds from the United States Department of Housing and Urban Development (HUD). The
amount of CDBG funds in the RLF program was later reduced to $425,586.00 when $64,414.00 was used
by the City for administrative costs.
The City stopped making loans under the RLF program in 2006 because of HUD findings related to the
CDBG program. Loan payments on outstanding loans continued to be collected but were booked as
CDBG program income instead of being prorated between the EDA grant and the CDBG grant As of
September 30, 2012, the program had collected a total of $827,933.35 in loan payments over the life of
the program EDA has requested that the EDA award be terminated for convenience and that the City
return 70 percent of the revenue from the RLF program, which is equal to the percentage of funds
originally contributed by the EDA Staff has identified $486,321.45 in loan payments that can be applied
to the payment to the EDA, leaving a short fall of $93,231.90 to meet EDA's request to terminate the
program.
Staff recommends utilizing $93,231.90 of previously appropriated funds from the General Fund portion of
Logname: 17EDA Page 1 of 2
the Housing Trust Fund along with $486,321 45 in loan payments to reimburse EDA the $579,553.35
required to terminate the RLF program. Staff also recommends entering into an Agreement with the EDA
to terminate the grant for convenience and closing the RLF program. The execution of the Agreement and
the payment of $579,553.35 will end all Federal obligations related to the EDA grant and the RLF
FISCAL INFORMATION / CERTIFICATION.
The Financial Management Services Director certifies that upon approval of the above recommendations,
adoption of the attached appropriation ordinance, funds are available in the current operating budget, as
appropriated, of the Grants Fund and the Fort Worth Housing Finance Corporation Fund.
FUND CENTERS.
TO Fund/Account/Centers
3) GR76 539120 017206990990
3) GR76 539120 017206991990
3) GR76 4XXXXX 017206990000
3) GR76 4X0000( 017206991000
FROM Fund/Account/Centers
$184.021.28 2) GR76 539120 017206990990
$302.300.17 2) GR76 539120 017206991990
$184.021.28 2) R109 539120 017109007003
$302.300.17
CERTIFICATIONS:
Submitted for Citv Manager's Office bv:
Originating Department Head:
Additional Information Contact:
Fernando Costa (6122)
Jay Chapa (5804)
Rhonda Hinz (2573)
ATTACHMENTS
1. 17EDA AO13.doc (Public)
2. available fund.PDF (CFW Internal)
3. EDA Termination Agreement.pdf (CFW Internal)
$184,021.28
$302,300.17
$931231.90
Logname. 17EDA Page 2 of 2