Explanation
BACKGROUND: This legislation authorizes the amendment of Ordinance 1564-2024 which was approved by City Council on July 5, 2024 to reduce the funding amount previously authorized within the 2023 HOME grant funds, as well as authorizes the expenditure in an amount up to $100,613.00 from the 2018 HOME Investment Partnerships Program (HOME) entitlement grant funds from the U.S. Department of Housing and Urban Development (HUD) and authorizes the Director of the Department of Development enter into a commitment letter, loan agreement, promissory note, mortgage, restrictive covenant, and authorizes the city to act as a lender for this project with the Homes on the Hill Community Development Corporation. The project is to develop and construct a single family housing unit at 120 N. Eureka Ave., that was recently from the City of Columbus Land Bank.
Ordinance 1564-2024 approved by City Council on July 5, 2024, authorized the Director of Development to support the development of the single housing unit at 120 N. Eureka Ave., in an amount of up to $270,201.00 of 2023 HOME Investment Partnerships Program (HOME) funding. Ordinance 1564-2024 will need to be amended to reduce the funded amount from the 2023 HOME grant funds in the amount of ($79,487.00) which will bring the total funded amount for the project utilizing 2023 HOME grant funds to be in an amount of $190,714.00. The reason for this reduction is that through the reconciliation process 2018 HOME grant funds were identified and can be utilized for this project. Therefore, this ordinance is authorizing the amount that was reduced from the 2023 grant funding ($79,487.00) as well as an additional request of funding in an amount up to $21,126.00 for a total amount of 2018 grant funding of $100,613.00 and a total funded amount for the overall project in an amount up to $291,327.00. The need for the additional HOME funding is due to the post construction appraisal was valued higher than anticipated thus creating a larger affordability gap and the additional need of funding to close that gap. The commitment letter and loan documents have not yet been executed.
The funding of this project will address the need for affordable housing in the City of Columbus for low-income families that are at or below 80% of the Area Median Income limits set by HUD. This project will add decent, safe, and sanitary housing to the Hilltop Neighborhood, located in the Greater Hilltop Area of Columbus. The increased availability of safe and stable housing in Columbus promotes the health and well-being of the neighborhood and the citizens living in the neighborhood.
We are funding this project with the Homes on the Hill Community Development Corporation, who is a Community Housing Development Organization (CHDO) in partnership with the City of Columbus. Homes on the Hill will use HOME CHDO set-aside funds to develop the 120 N. Eureka Avenue project on land purchased from the Land Bank.
Homes on the Hill Community Development Organization was founded in 1993 with the mission to be the exemplary housing counseling and development organization in Central Ohio.
With the construction of a new, single-family home at 120 N. Eureka Avenue, the Homes on the Hill Community Development Organization is investing in and providing affordable housing to the Hilltop neighborhood. The two-story, single family home will consist of three bedrooms, two and a half bathrooms, a basement, a garage, and will be built to City AWARE standards. The home will be sold to a first-time homebuyer earning at or below 80% of the Area Median Income as defined by HUD.
This legislation represents appropriation for a part of the HOME portion of the 2018 and 2023 Action Plan per ordinance numbers 2589-2017 and 3353-2022 respectively.
Emergency Designation: An emergency exists as this gap in funding due to the appraisal prevents the closing on this house. The more time that this home sits vacant the possibility of vandalism increases and the future homeowner could face further financial hardships for not closing on the property timely.
Contract Compliance: the vendor number is 005144 and expires 08/01/2026
Fiscal Impact: $291,327.00 is available from the 2022 HOME grant (G451801) and 2023 HOME grant (G442202) funds.
Title
To authorize the amendment of Ordinance 1564-2024 which was approved by City Council on July 5, 2024 to reduce the funding amount of the 2023 HOME Investment Partnerships Program grant funding in an mount up to ($79,487.00) as well as authorizes the expenditure in an amount up to $100,613.00 of 2018 HOME Investment Partnerships Program (HOME) entitlement grant funds of HOME Investment Partnerships Program (HOME) grant from the U.S. Department of Housing and Urban Development; and to authorize the Director of the Department of Development to enter into a commitment letter, loan agreement, promissory note, mortgage, restrictive covenant, and authorizes the city to act as a lender for this project with the Homes on the Hill Community Development Corporation to construct a single family home in an amount up to $291,317.00; and declare emergency. ($100,613.00).
Body
WHEREAS, the City of Columbus is a participating jurisdiction of the U.S. Department of Housing and Urban Development; and
WHEREAS, the City of Columbus is the recipient of HOME Investment Partnerships funds from the U.S. Department of Housing and Urban Development; and
WHEREAS, the Columbus City Council has approved the 2018 Action Plan per ordinance 2589-2017 and 2023 Action Plan per ordinance 3353-2022 and approved the initial funding of this project via Ordinance 1564-2024; and
WHEREAS, the Department of Development desires to support the Homes on the Hill Community Development Corporation with financial support for a single family home at 120 N. Eureka Ave; and
WHEREAS, the need to amend Ordinance 1564-2024 is necessary as the Department of Development through the reconciliation process showed $100,613.00 still available within the 2018 Home Grant that needed to be spent prior to the end of the period of performance and therefore wishes to reduce the ACPO010623 in an amount of $79,487.00 which results in total funding with in the 2023 HOME Investments Partnerships funds for this project to be in an amount up to $190,714.00; and
WHEREAS, the post construction appraisal created a larger gap in affordability therefore additional funding was needed for this project in an amount up to $21,126.00 utilizing the 2018 HOME Investment Partnership grant bringing the overall total for this project to be in an amount up to $291,327.00;and
WHEREAS, an emergency exists in the usual daily operation of the Department of Development in that this home is ready to close and the gap in funding is preventing this from happening. This gap was unforeseen due to the appraisal being much higher. The more time that this home sits vacant the possibility of vandalism increases and the future homeowner could face further financial hardships for not closing on the property, allowing this as an emergency measure prevents possible vandalism to the home and prevents any undue hardships on the future homeowner; an emergency also exists in the usual daily operation of the Department of Development in that it is immediately necessary to authorize the Director to enter into a commitment letter, loan agreement, promissory note, mortgage, restrictive covenant, which authorizes the city to act as a lender for this project with the Homes on the Hill Community Development Corporation to construct a single family home, all for the immediate preservation of the public health, peace, property, safety, and welfare; and NOW, THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
SECTION 1. That Section 2. of Ordinance 1564-2024 which was approved by City Council on July 5, 2024 is hereby amended to reduce the funding on ACPO010623 in an amount of ($79,487.00) which results in total funding with in the 2023 HOME Investments Partnerships funds for this project to be in an amount up to $190,714.00, as follows, with additions in underline and deletions in strikethrough.
SECTION 2. That the expenditure of $270,201.00 $190,714.00 or so much thereof as may be needed, is hereby authorized in Fund 2201 (HOME), from Dept-Div 44-10 (Housing), G442202 (2023 HOME grant), object class 05 (Other Expenses) per the account codes in the attachment to this ordinance.
SECTION 2. That the existing Section 2 of Ordinance 1564-2024 is hereby repealed.
SECTION 3. That the expenditure of $100,613.00 or so much thereof as may be needed, is hereby authorized in Fund 2201 (HOME), from Dept-Div 44-10 (Housing), G451801 (2018 HOME grant), object class 05 (Other Expenses) per the account codes in the attachment to this ordinance.
SECTION 4. That the Director of Development is hereby authorized to execute a commitment letter and loan agreement that authorizes the city to act as a lender and have a promissory note, mortgage, and restrictive convent executed for this project with Homes on the Hill Community Development Corporation to construct a single family home at 120 N. Eureka Avenue in a total amount for this project in an amount up to $291,327.00.
SECTION 5. Funds are hereby deemed appropriated and expenditures and transfers authorized to carry out the purposes of this ordinance and the City Auditor shall establish such accounting codes as necessary.
SECTION 6. That the City Auditor is authorized to make any accounting changes to revise the funding source for all contracts or contract modifications associated with this ordinance.
SECTION 7. At the end of the grant period, any repayment of unencumbered balances required by the grantor is hereby authorized and any unused City match monies may be transferred back to the City fund from which they originated in accordance with all applicable grant agreements.
SECTION 8. That for the reasons stated in the preamble hereto, which is hereby made a part hereof, this Ordinance is hereby declared to be an emergency measure and shall take effect and be in force from and after its approval by the Mayor, or ten days after passage if the Mayor neither approves nor vetoes the same.