Neighborhood Stabilization Program “The Power of Community”

Today’s Presentation Background Information State Neighborhood Stabilization Program –Program Strategies –Citizen Participation and Outreach –Application Timeline Bid Documents for Related Services Other Related Efforts

Background Information “The Power of Community”

Federal Legislation Housing and Economic Recovery Act, 2008 –Signed by President Bush on July 30, 2008 –Allocated $3.92 billion through Community Development Block Grants (CDBG) for Neighborhood Stabilization Program (NSP) to state and local governments American Recovery and Reinvestment Act –Additional $2 billion for NSP

Purpose Reduce Bank-Owned Inventory Stabilize Home Values and Neighborhoods Get Families/Individuals into Homes Benefit Qualified Families/Individuals A s S oon A s P ossible NOT Foreclosure Prevention Program

State Allocation State of Florida was allocated $91 million Must benefit qualified families/individuals 25% to benefit low-income persons/families Identified 26 communities for funding, including the City of Palm Coast Allocations Identified for the City –Regular Allocation = $2,177,980 –Supplemental Allocation = $486,923

Income Definitions AMI = Area Median Income Low-Income = Less than 50% AMI Qualified Families/Individuals = Less than 120% AMI Family Size1234 <50% AMI $19,450$22,250$25,000$27,800 <120% AMI $46,700$53,400$60,050$66,700

Palm Coast Targeted Number of Foreclosures ,053 foreclosures of 21,382 mortgages = 9.6% High Unemployment Rate = 8.3% (11.7%) High Cost Mortgages = 26.5% Decline in Home Prices = 21.1% Department of Housing and Urban Development, November 2008

Foreclosures

State Neighborhood Stabilization Program “The Power of Community”

State NSP Program Activities can be carried out through contracts with private/public/not-for-profit (competitive process) Funds must be Obligated within months Incentive Based Set-Aside Program Income Returned to State Monitoring and Reporting Long-Term Affordability Compliance with Federal/State Laws –Environmental –Uniform Relocation Act –Fair Housing Act –Davis Bacon –Conflict of Interest Regular vs. Supplemental Allocation

Eligible NSP Strategies Acquisition, Rehabilitation, and Resell Housing Finance Assistance Establishing Land Banks Demolition and Clearance/Housing Redevelopment Acquisition, Rehabilitation, and Lease to Low Income Individuals/Families

Acquisition/Rehabilitation/Resell to Individuals/Families Minimum 15% Purchase Discount Rehabilitation must meet federal/state/local codes and be “green” Benefit Qualified Individuals/Families –Credit Worthy –Less than 120% AMI –Undergo Housing Counseling Maintain Long-Term Affordability

Housing Finance Assistance Down-Payment Assistance and/or Gap Financing for Foreclosures Benefit Qualified Individuals/Families –Credit Worthy –Less than 120% AMI –Undergo Housing Counseling Maintain Long-Term Affordability

Example $80,000 Foreclosed Home Purchase + $40,000 Rehabilitation Costs $120,000 Total Investment in Property $90,000 Buyer Traditional Mortgage $30,000 Housing Finance Assistance –Soft Second Mortgage –0% Interest Rate, 10% Forgiven/Yr.

Establishing Land Banks No more than 10% of Regular Allocation Funds (Measured Statewide) Establish Land Bank Strategic Plan Maintenance Issues Land Bank must obligate property within 10 years for NSP Activity Does not address foreclosed homes

Demolition and Clearance/Housing Redevelopment No more than 5% of Regular Allocation Funds (Measured Statewide) Must be foreclosed and blighted (SR 100 Community Redevelopment Area only area found to be blighted) Must replace any home demolished

Acquisition/Rehabilitation/Lease to Individuals/Families If pursued, Supplemental Allocation must be used for this Strategy ($486,923) Minimum 15% Purchase Discount Rehabilitation must meet federal/state/local codes and be “green” Benefit Low-Income Individuals/Families Maintain Long-Term Affordability

Discussion of NSP Strategies Acquisition, Rehabilitation, and Resell Housing Finance Assistance Establishing Land Banks Demolition and Clearance/Housing Redevelopment Acquisition, Rehabilitation, and Lease to Low Income Individuals/Families

Citizen Participation A Citizens Advisory Task Force (CATF) is required to review and provide input on the Local Housing Assistance Plan (LHAP) for NSP Options –Appoint Current City Advisory Board –Appoint Flagler County Affordable Housing Board –Accept Applications to Fill the Task Force City Council approves final LHAP Numerous Public Workshops

Application Timeline February 25, 2009 – Public Workshop March , 2009 – CATF Meetings March 13, 2009 – Draft Application/LHAP March 14 – 30 – Public Comment Period March 31, 2009 – City Council Workshop and Special Meeting April 6, 2009 – Application Due to State

Bid Document for Related Services “The Power of Community”

Bid Document Overview Services to Implement Program No Local Preference Allowed (Prohibited by Federal and State Guidelines) May Bid on One or More Services Each Bid for Service will be Evaluated Individually Ranking/Contract will be Forwarded to City Council for Final Approval

Bid Document Services Program Management Consultant Property Developers Appraisal and Valuation Services Title & Closing Services Environmental Engineers Construction Management Rental Developers Rental Property Management Housing Counselors Builders/Contractors

Other Related Efforts “The Power of Community”

Other Related Efforts Interlocal Agreement with Flagler County –Draft completed, finalizing language –Anticipated March/April adoption consideration International Property Maintenance Code –New 2009 version available in March –Anticipated April/May adoption consideration Foreclosure Registration and Maintenance Ordinance –Includes requirements for banks to designate local agent, registration fee, inspections, and citations –Pending state legislation that may preempt local regulations –Anticipated April/May adoption consideration Researching how to roll code fines into annual property special tax assessments (City Attorney)

“The Power of Community”