HomeMy WebLinkAboutContract 45941-A1 1b ro
CITY SECRETAW
R EC-1 Err.; CONTRACT NO.
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CITY FIRST AMENDMENT TO CITY SECRETARY CONTRACT NO. 45941
2. WIREAS, on September 17, 2014 the City of Fort Worth ("City") and Cornerstone
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Assistance Network Housing Development Corporation ("Developer") made and entered into
City Secretary Contract No. 45941 (the "Contract"), as authorized by the City Council in M&C
C-26603 adopted on December 17, 2013 which provided $270,000.00 of City's HOME funds to
Developer for the development and construction of 2 single family houses in the Polytechnic
neighborhood;
WHEREAS, the funding provided to Developer in the Contract was from a grant received
by the City from the United States Department of Housing and Urban Development through the
HOME Investment Partnership Program, Catalog of Federal Domestic Assistance No. 14.239;
WHEREAS, as a Developer is qualified as a Community Housing Development
Organization ("CHDO") under the HOME Regulations;
WHEREAS, Developer requested $139,766.00 of HOME CHDO funds for the
construction of a single family house located at 3233 Fitzhugh, Fort Worth, TX 76105 to be sold
to HOME Eligible Buyers under the terms and conditions set forth in the Contract;
WHEREAS, Developer has requested an additional $30,852.11 of HOME Funds to
complete the house due to increases in construction costs, as well as other unanticipated costs not
included in the estimates on which the Budget was based, and has extend the deadline
WHEREAS, Developer has requested an amendment to the line item amounts listed in
the Budget due to unforeseen additional costs for the project and an extension of the
Completion Deadline and time frames in due to construction delays;
WHEREAS, the Contract calls for the payment of 10% of the total HOME eligible
development costs actually spent for the house as a Developer Fee, but because it is a percentage
of the costs actually spent, it not included in the Budget as a line item;
WHEREAS, the house is now complete and the Developer Fee can be determined and
paid, either out of HOME funds or HOME program income depending on regulatory
requirements, and the definition of HOME Funds can be amended to reflect the total
development costs including the sum necessary for payment of the Developer Fee;
WHEREAS, the house has been sold to a HOME Eligible Buyer and Developer has
requested an amendment to the line items in the Budget to reflect the final expenses for the
project, including the actual amounts of the seller-paid closing costs as shown on the HUD-1
Settlement Statement; and
WHEREAS, it is the mutual desire of City and Developer to amend the Contract to
complete the project and meet Contract objectives.
OFFICIAL RECORD
CITY SECRETARY
Contract Amendment No. 1 to CSC No.45941 FT. WORTH, TX Page 1
Cornerstone Assistance Network Housing Development Corp.—3233 Flizhugn Rev. 07-23-2015
NOW THEREFORE, City and Developer hereby agree as follows:
I.
Section 2. DEFINITIONS is amended to be and read as follows:
"Completion Deadline means June 25, 2015."
"Home Funds means the HOME Program grant funds supplied by City to
Developer under the terms of this Contract not to exceed $170,618.11."
II.
Section 4.1 is amended to be and read as follows:
"4.1 Provide HOME Funds. City shall provide Developer up to
$155,107.37 of HOME Funds in the form of the Loan for eligible expenses for the
development of the house under the terms and conditions described herein."
Section 7.8 is amended to be and read as follows:
447.8 Developer Fee.
Developer shall be paid the Developer Fee as more particularly described
in Exhibit "C" — Construction and Reimbursement Schedule on the closing of
the sale of the house to a HOME Eligible Buyer so long as City has received
copies of all of the inspections set forth in Section 6.1.1. City shall pay Developer
Fee at City's sole option (i) outside of closing upon receipt from Developer of an
invoice including Complete Documentation showing the total amount of HOME
Funds actually spent to develop the Required Improvements, or(ii) at closing."
Section 17 INSURANCE AND BONDING is amended to be and read as follows by
substituting the following for the first sentence:_
"Developer will maintain coverage in the form of insurance or bond in the
amount of$155,107.37 to insure against loss from the fraud, theft or dishonesty
of any of Developer's officers, agents, trustees, directors or employees."
III.
Exhibit "B" - Budget and Exhibit "C" - Project and Reimbursement Schedule
attached to the Contract are hereby replaced with Exhibit "B" - Budget Revised 07/2015 and
Exhibit"C" - Project and Reimbursement Schedule Revised 07/2015 attached hereto.
Contract Amendment No. 1 to CSC No.45941 Page 2
Cornerstone Assistance Network Housing Development Corp.—3233 Fitzhugh Rev. 07-23-2015
IV.
All other terms and conditions of City Secretary Contract No. 45941 not amended herein
remain unaffected and in full force and effect, are binding upon the Parties, and are hereby
ratified by the Parties. Capitalized terms not defined herein shall have meanings assigned to
them in the Contract.
[SIGNATURES ON FOLLOWING PAGE]
Contract Amendment No. 1 to CSC No.45941 Page 3
Cornerstone Assistance Network Housing Development Corp.—3233 Fitzhugh Rev. 07-23-2015
ACC +D AND AGREED:
ATTEST: *ORr�i TY OF FORT WORTH
Q O?�
o
City Secretary V g ernando Costa, Assistant City Manager
M&C C-26603 Date: 1 °
rE000Ag
APP OVED AS TO FO AN Y:
Vicki S. Ganske, Senior Assistant City Attorney
CORNERSTONE ASSISTANCE NETWORK
HOUSING DEVELOPMENT CORPORATION,
a Texas non-profit corporation
ilip Posey, Preside
OFFICIAL RECORD
CITY SECRETARY
FT. WORTH, TX
Contract Amendment No. 1 to CSC No.45941 Page 4
Cornerstone Assistance Network Housing Development Corp.—3233 Fitzhugh Rev. 07-23-2015
EXHIBIT "B"
BUDGET REVISED 07/2015
CORNERSTONE ASSISTANCE NETWORK HOUSING DEVELOPMENT
CORPORATION
3233 FITZHUGH AVENUE
HOME Funds for Project Related Development Costs: $155,107.37
Developer Fee: $15,510.74*
Development Budget
Use of Funds Source of Funds
Predevelopment Cost HOME$ OTHER SOURCE OF TOTAL$
FUNDS $FUNDS OTHER FUNDS FUNDS
(1) (2) (Names) (1+2)
1.Market Study 800 800
2.Feasibility(i.e.: preliminary work write-up,
cost estimates,design)
3.Other
Total Predevelo ment Cost 1+2=3 800 800
Development Cost
4.Land and/or building acquisition 6,000 6,000
5.Site Preparation 12,475 12,475
6.Construction Cost 132,416.99 132,416.99
7.Fence
8.Landscape
9.Contingency
10.Appraisal 400 400
11.Architect&Engineering Fees 1,291.73 1,291.73
12.Property Survey 350 418.63 Proceeds of Sale** 768.63
13.Legal Fees 205 Proceeds of Sale** 205
14.Real Estate Commission 5,310 Proceeds of Sale** 5,310
15.Utility Hookup/Impact Fees
16.Title&Recording Fees 1,373.65 989.71 Proceeds of Sale** 2,363.36
17.Property Taxes 1,211.25 Proceeds of Sale** 1,211.25
Total Development Cost Total of items 4-20 154,307.37 8,134.59 162,441.59
Total Cost 155,107.37 8,134.59 163,241.59
*Developer Fee shall be paid from HOME Funds by invoice after the closing of the sale of the house to a HOME
Eligible Buyer. Developer Fee consists of 10%of the project related development costs.
**Seller paid closing costs as shown on the HUD-I Settlement Statement paid from gross sales proceeds from the
sale of the house.
CHDO Funds—Exhibit"B"—Budget Page 5
Cornerstone Assistance Network Housing Development Corp.—3233 Fitzhugh Rev.07-23-2015
EXHIBIT "C"
PROJECT AND REIMBURSEMENT SCHEDULE REVISED 07/2015
CORNERSTONE ASSISTANCE NETWORK HOUSING DEVELOPMENT
CORPORATION
3233 FITZHUGH AVENUE
Beginning Week—subject to
Phase Activity weather permitting
PHASE I ACTIVITIES: Lot Acquisition
Lot Preparation(Demolition)
Soft Costs(Survey,Appraisal,
Architecture and Engineering Fees,and
Title and Recording Fees)
PHASE I DEADLINE: $14,000*
October 31,2014 1st Payment*
PHASE II ACTIVIITES: Plumbing
Foundation
Framing
PHASE II DEADLINE: 2"d Payment* $18,000*
January 31,2014
PHASE III ACTIVIITES: Sheetrock,Tape/Bed/Texture/Trim-out
Roofing
Insulation
Siding and Brick
HVAC,Plumbing,Electrical
PHASE III DEADLINE: 3rd Payment* $58,000*
March 31,2015
PHASE IV ACTIVIITES: Landscaping,Paving
Flooring
Cabinets and Countertops
Appliances,Interior Paint,trim/finish-
out
PHASE IV DEADLINE: 4A Payment* $65,107.37*
June 25,2015
CONSTRUCTION TOTAL $155,107.37
DEVELOPER FEE Paid at closing of sale to HOME $15,510.74**
Eligible Buyer per Section 7.8**
*Developer will be reimbursed for eligible expenses only. The amounts are estimates and are subject to change.
"Developer Fee will be made after closing of sale of the house to a HOME Eligible Buyer.
***Prior to Reimbursement for Final Payment,Exhibit"G"-HOME Project Compliance Report must be
submitted
Contract Amendment No. 1 to CSC No.45941 Page 6
Cornerstone Assistance Network Housing Development Corp.—3233 Fitzhugh Rev.07-23-2015
M&C Review Page I of 2
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CITY COUNCIL AGENDA FORr1
COUNCIL ACTION: Approved on 12/17/2013
......... _ .._... _...... . ......... _.
LOG
DATE: 12/17/2013 REFERENCE `'`C-26603 NAME: 17AMENDCANHDCPOLYPROJECT
CODE: C TYPE: CONSENT PUBLIC NO
HEARING:
SUBJECT: Authorize Amendment to Mayor and Council Communication C-24710 for the Conditional
Commitment and Contract for HOME Investment Partnership Program Grant Funds to
Cornerstone Assistance Network Housing Development Corporation for the Development
of Single Family Houses in the Polytechnic Neighborhood to Comply with United States
Department of Housing and Urban Development Requirements, Reduce the Number of
Houses to be Constructed to Two, and Authorize Release of City Liens (COUNCIL
DISTRICT 5)
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize the amendment to Mayor and Council Communication C-24710 that approved a
conditional commitment and contract with Cornerstone Assistance Network Housing Development
Corporation for HOME Investment Partnerships Program grant funds to change certain terms in the
Mayor and Council Communication to comply with United States Department of Housing and Urban
Development requirements, and specifically to remove Community Housing Development
Organization proceeds, include a developer fee, and reduce the number of houses to be constructed
from three to two; and
2. Authorize the release of any City liens on properties located at 3220, 3229, and 3233 Fitzhugh
Avenue to be acquired by Cornerstone Assistance Network Housing Development Corporation, as
sites for the construction of the houses.
DISCUSSION:
On January 25, 2011, (M&C C-24710) the City Council approved the award of$320,000.00 in HOME
Investment Partnerships Program grant funds to Cornerstone Assistance Network Housing
Development Corporation (CANHDC), a certified Community Housing Development Organization
(CHDO), for the development of three single family houses to be located in the Polytechnic
Neighborhood. Up to $50,000.00 of the HOME funds were to be used for CHDO operating expenses
and $270,000.00 of the HOME funds were to be used for eligible development and construction costs
for three single family houses. Due to increases in construction costs, CANHDC can only build two
houses with the HOME funds awarded to it.
In 2011, Staff developed a new policy regarding the use of CHDO proceeds with United States
Department of Housing and Urban Development's (HUD) guidance. HUD approved the policy on
May 3, 2011 and under the new policy, CHDO proceeds were no longer allowed and a 10 percent
developer fee was implemented. Staff recommends the following amendment to contract terms
authorized by M&C C-24710, based upon direction received from HUD:
• Remove any reference to CHDO proceeds;
• Include a 10 percent developer fee based on the total cost of construction to be paid once the
homes are sold; and
• Reduce the number of houses to be constructed in the Polytechnic Neighborhood to two single
family houses due to increase in construction costs since original proposal submission.
http://apps.cfwnet.org/council_packet/mc_review.asp?ID=19340&councildate=12/17/2013 7/30/2015
M&C Review Page 2 of 2
To date, neither the conditional commitment nor the contract with CANHDC approved under Mayor
and Council Communication (M&C) C-24710 have been executed. Therefore, upon City Council
approval of this M&C, Staff will move forward with execution of the documents with CANHDC with the
above-referenced terms.
In addition, CANHDC will acquire two lots located at either 3220, 3229, or 3233 Fitzhugh Avenue to
construct the houses. The City's match obligation must be satisfied annually from non-federal
sources used for qualified housing projects, such as donated materials, cash donations, in-kind
contributions, and sweat equity. Staff recommends that the liens be released since this amount can
be counted toward the City's HOME Match obligation.
The project is located in COUNCIL DISTRICT 5, Mapsco 78T.
FISCAL INFORMATION/CERTIFICATION:
The Financial Management Services Director certifies that this action will have no material effect on
City funds.
TO Fund/Account/Centers FROM Fund/Account/Centers
Submitted for City Manager's Office by: Fernando Costa (6122)
Originating Department Head: Jay Chapa (5804)
Additional Information Contact: Cynthia Garcia (8187)
Avis F. Chaisson (6342)
ATTACHMENTS
CANHDCPoIyHouses.pdf
http://apps.cfwnet.org/council_packet/mc_review.asp?ID=19340&councildate=12/17/2013 7/30/2015