HomeMy WebLinkAboutOrdinance 18362-11-2008Ordinance No 18362 11 2008
AN ORDINANCE INCREASING ESTIMATED RECEIPTS AND APPROPRIATIONS IN
THE GRANTS FUND IN THE AMOUNT OF $6 307 433 00 UPON RECEIPT OF A GRANT
FROM THE UNITED STATES DEPARTMENT OF HOUSING AND URBAN
DEVELOPMENT FOR THE PURPOSE OF FUNDING THE NEIGHBORHOOD
STABILIZATION PROGRAM; PROVIDING FOR A SEVERABILITY CLAUSE, MAKING
THIS ORDINANCE CUMULATIVE OF PRIOR ORDINANCES IN CONFLICT HEREWITH
AND PROVIDING AN EFFECTIVE DATE.
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH TEXAS
SECTION 1
That in addition to those amounts allocated to the various City departments for Fiscal Year 2008-2009 there
shall also be increased estimated receipts and appropriations in the Grants Fund in the amount of
$6 307 433 00 upon receipt of a grant from the United States Department of Housing and Urban
Development for the purpose of funding the Neighborhood Stabilization Program
SECTION 2
That should any portion, section or part of a section of this ordinance be declared invalid inoperative or void
for any reason by a court of competent jurisdiction such decision, opinion or judgment shall in no way
impair the remaining portions, sections, or parts of sections of this ordinance, which said remaining
provisions shall be and remain in full force and effect.
SECTION 3
That this ordinance shall be incorporated into the ordinance of the municipal government of the City of Fort
Worth for the ensuing Fiscal Year beginning October 1 2008 and ending September 30 2009 and all other
ordinances and appropriations amending the same except in those instances where the provisions of this
ordinance are in direct conflict with such other ordinances and appropriations, in which instance said
conflicting provisions of said prior ordinances and appropriations are hereby expressly repealed
SECTION 4
This ordinance shall take effect upon adoption
APPROVED AS TO FORM AND LEGALITY
~ ~ ~~~~~
Assistant City Attorney
ADOPTED AND EFFECTIVE. November 11, 2008
City of Fort Worth Foreclosures
ORDINANCE NO 18362 11 2008 AT HWY 14
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Miles Housing & Economic Development Department
3/11/07 LH
ORDINANCE NO 18362 11 2008 City of Fort Worth Zin Cnc~P~
0 1.25 2.5 5 7.5 ~~-'~` ~~'~'~
Miles Housing & Economic Development Department
3/11/07 LH
City of Fort Worth, Texas
Mayor and Council Communication
~_
COUNCIL ACTION Approved on 11/11/2008 Ord No 18362 11 2008
DATE Tuesday November 11 2008
LOG NAME. 17NSP GRANT REFERENCE NO G 16358
SUBJECT
Approval of Plan for Use of Neighborhood Stabilization Program Grant Funds from the
United States Department of Housing and Urban Development in the Amount of $6 307 433 00
_.
RECOMMENDATION
It is recommended that the City Council
1 Conduct a public hearing to allow citizen input and consideration regarding the Proposed Plan for Use
of Neighborhood Stabilization Program grant funds from the United States Department of Housing and
Urban Development,
2. Approve a Substantial Amendment to the City's Consolidated Plan and 2008-2009 Action Plan for use of
Federal grant funds from the United States Department of Housing and Urban Development, outlining use
of funds for the Neighborhood Stabilization Program
3 Adopt the attached appropriation ordinance increasing the estimated receipts and appropriations in the
Grants Fund in the total amount of $6 307 433 00 in Neighborhood Stabilization Program funds and
4 Authorize the City Manager or his designee to execute the Neighborhood Stabilization Program grant
agreement, United States Department of Housing and Urban Development certifications, and such
associated documents as may be required by United States Department of Housing and Urban
Development regulations in order to administer the Neighborhood Stabilization Program
DISCUSSION
On October 6 2008 the City of Fort Worth received notification from the United States Department of
Housing and Urban Development (HUD) that it will be awarded $6 307 433 00 under the Neighborhood
Stabilization Program (NSP) The program was authorized by the Housing and Economic Recovery Act of
2008 approved by Congress on July 30 2008 for the purpose of assisting in the redevelopment of
abandoned and foreclosed homes The NSP provides a special allocation of Community Development
Block Grant (CDBG) funds with alternative requirements and regulatory waivers One significant alternative
requirement is the ability to serve households earning 120 percent of the area median income ($77' 500 00
for a family of four) versus only being able to serve up to 80 percent of area median income households
($51 400 00 for a family of four) under regular CDBG program However at least 25 percent of the funds
must be used for households earning less than 50 percent of the area median income ($32 300 00 for a
family of four)
The NSP funds may be used for activities which include but are not limited to
Financing mechanisms such as soft seconds, loan loss reserves and shared equity
for purchase and redevelopment of foreclosed homes and residential properties
Purchase rehabilitation and resale or rental of foreclosed and abandoned homes and residential
properties
Logname• 17NSP GRANT Page 1 of 3
Land banking of foreclosed properties for future development
Demolition of blighted structures
Redevelopment of demolished or vacant properties
Jurisdictions receiving NSP funds must develop a plan for expenditure of funds and submit the plan to HUD
by December 1 2008 The plan must demonstrate that funds will be distributed to the areas of greatest
need including those with the greatest percentage of home foreclosures, with the greatest percentages of
homes financed by a subprime mortgage loan and areas likely to face a significant or continued rise in the
rate of home foreclosures Grantees will have 18 months to expend or obligate funds
Recommended Use of Funds
Staff is recommending that $5 676 690 00 in program funds be used for a Homebuyer Assistance Program
much like the program currently operated by the City Income eligible purchasers of foreclosed homes
would receive a subordinate five year forgivable loan of $20 000 00 to assist with closing costs a down
payment and any repairs that may be necessary to meet program standards The unit must serve as the
buyer's primary residence for a period of at least five years. If this requirement is met the loan is forgiven
failure to meet this requirement would result in full repayment of the loan Staff believes this use of funds is
simple draws on the efficiencies of professionals in the marketplace achieves substantial leveraging and
gets the maximum number of foreclosed homes back into possession of homeowners. Staff also
recommends that $630 743 00 be used for administration and program delivery This amount represents
the 10 percent allowed for this use under the NSP regulations
Foreclosures in Fort Worth
According to data obtained from Foreclosure Listing Inc. during the period from September 2007 through
October 2008 there were 3 780 foreclosures in Fort Worth in 38 zip codes The average assessed value of
foreclosed homes for this period was slightly over $120 000 00 The average unpaid loan balance was
$102 613 00 The average age of homes was 26 years and the average size was 1 909 square feet. Forty
nine percent of the foreclosure activity occurred in seven of the 38 zip codes previously mentioned These
zip codes are listed below along with the density of foreclosures per square mile Staff is recommending
that these zip codes be considered as target areas for NSP benefits.
76248 341 and > 20 01 per square mile (COUNCIL DISTRICT 4)
76112 299 and > 20 01 per square mile (COUNCIL DISTRICT 4 5 and 8)
76123 282 and > 20 01 per square mile (COUNCIL DISTRICT 3 and 6)
76179 282 and 10 01 to 15 per square mile (COUNCIL DISTRICT 7)
76133 248 and > 20 01 per square mile (COUNCIL DISTRICT 6 and 9)
76137 200 and 15 01 to 20 per square mile (COUNCIL DISTRICT 4)
76131 189 and 10 01 to 15 per square mile (COUNCIL DISTRICT 2 and 7)
FISCAL fNFORMATION/CERTIFICATION
The Financial Management Services Director certifies that upon approval of the above recommendations
award of the grant, and adoption of the attached appropriation ordinance funds will be available in the
current operating budget, as appropriated of the Grants Fund
TO Fund/Account/Centers
GR76 451727 017206323010 $630.743.00
GR76 451727 017206323020 $5.676,690.00
FROM Fund/Account/Centers
Logname 17NSP GRANT
Page 2 of 3
GR76 5X~CXX 017206323010 $630.743.00
GR76 539120 017206323020 $5.676,690.00
Submitted for City Manager's Office b~ Tom Higgins (6140)
Originating Department Head. Jay Chapa (6192)
Additional Information Contact: Jerome Walker (7537)
Logname 17NSP GRANT Page 3 of 3