HomeMy WebLinkAboutIR 6917 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 6917
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~0" -,fOk �� To the Mayor and Members of the City Council March 8, 1984
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�rExA`' Subject: HOUSING AND URBAN-RURAL RECOVERY ACT OF 1983
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Background
On November 30, 1983, President Reagan signed into law, the Housing and
Urban-Rural Recovery Act of 1983. Among other provisions, the Act
created two new initiatives for the development of law and moderate in-
come rental housing, the Rental Rehabilitation Block Grant and the Ren-
tal Housing Development Program.
Rental Rehabilitation Block Grant
The Rental Rehabilitation Block Grant program is the successor to the
Rental Rehabilitation Demonstration Program previously approved by the
City Council (M&C G-5895) . The program will operate in a similar
fashion to the demonstration project with some exceptions.
The Rental Block Grant will be separate and distinct from the City's
Community Development Block Grant (CDBG). CDBG funds may be used, how-
ever, to supplement the Rental Rehabilitation program.
The Rental Rehabilitation Block Grant is an entitlement program and
funds will be distributed according to a formula developed by the
Department of Housing and Urban Development (HUD). It is estimated that
the City will receive $200,000 to $300,000 per year for the next two
years. In addition, the City will receive Section 8 Rental Assistance
Certificates and/or Vouchers at a rate of one Certificate per $5,000 in
grant funds (40 to 60 certificates per year).
Unlike the Rental Demonstration program, the maximums subsidy for a ren-
tal unit will be $5,000, except in high-cost areas. There is a require-
ment for cities to provide incentives for the rehabilitation of large
family units (three and four bedroom), which can be accomplished through
the use of CDBG funds for additional subsidies.
Rental Production Program
The Act also provides for a Rental Production Program. Participation in
this program will be on a competitive basis. Fort Worth's eligibility
for the program will be determined by a formula established by HUD.
If eligible, the City could provide assistance to developers of rental
housing for up to 50% of total construction costs (site acquisition
costs are not eligible). The assistance can be in the form of a grant,
direct loan, or deferred loan. Projects will be selected by the City
and submitted to HUD for approval. Funding will cane directly from HUD,
with the City having administrative responsibility.
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS
INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 6917-p.2
�,P Ti qEo
r,40RT"p To the Mayor and Members of the City Council March 8, 1984
u =
TexAy. Subject: HOUSING AND URBAN-RURAL RECOVERY ACT OF 1983
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Additional assistance may be provided by the City through the use of
mortgage revenue bonds, CDBG funds, or, with the cooperation of the
Housing Authority, through bonds issued by the Authority.
Developers must agree not to discriminate against tenants receiving
housing assistance or tenants with children. Owners cannot convert
units to condominium ownership for twenty years. Finally, at least
twenty percent of the assisted units must be occupied or be made
available to low and moderate income families.
Because same of the traditional housing programs are being phased out or
are experiencing a reduction in funding, staff recamler dsid that the City
participate in both of these programs when funds are available. The
City Council will be notified when new details are available.
( Robert L. Herchert
City Manager
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ISSUED BY THE CITY MANAGER - FORT WORTH, TEXAS