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Date
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March 10, 2008
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Agenda
Item No. 35 Roll
Call No. 08- Communication No. 08-108
Submitted by: Larry Hulse, Director Community Development Department |
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AGENDA HEADING:
Authorizing
Execution of HOME Contract Documents with Home Opportunities Made Easy, Inc. for
renovation of housing to be sold for affordable home ownership as condominium
units.
SYNOPSIS:
Recommend
authorization for execution of HOME Contract Documents with Home Opportunities
Made Easy, Inc. (Home, Inc.) for renovation of housing to be sold for
affordable home ownership as condominium units. This project involves
allocation of City HOME funds of $330,000 for rehabilitation of ten units (5
duplexes) that the Governing Board of the Des Moines Municipal Housing Agency
(DMMHA) has sold to Home Opportunities Made Easy, Inc (
FISCAL IMPACT:
Amount: $330,000 – City
HOME Loan to be advanced during construction as work is completed.
Funding Source: FY
2007-08 Operating Budget, SP036, CDD49900, HOME 2007009, page 315.
ADDITIONAL INFORMATION:
HOME, Inc. is a local non profit housing
developer and housing service provider that has worked extensively with the
City of
HOME, Inc. is developing the legal
documents to sell and establish the duplexes as condominium units. A Home Owners’ Association will be
incorporated for Bel Aire Commons and a horizontal property regime will be
established to maintain and regulate the common areas. The exterior walls surrounding
each unit or any pipes, wires conduits or other utility lines through each unit,
which are utilized for more than one unit, will be maintained by the Bel Aire
Commons Association rather than an individual homeowner. The Horizontal
Property Regime will require that a professional property manager be hired to
manage maintenance and repair to the common areas during the duration of the
City liens.
Subsidy funding for the project will
include $250,000 from the Polk County Housing Trust Fund (PCHTF) for purchase
and $330,000 for rehabilitation of ten of the units from City HOME funds. The City will place a forgivable lien against
each unit assisted for a ten year period requiring that the property be
occupied by a low income family as their principal place of residence. The PCHTF money will also be forgivable and
cause a lien to be placed against the property.
Private bank funding will also be used for purchase and rehabilitation,
but will require repayment.
Total development of each unit will cost
approximately $101,000. The City and
PCHTF subsidies will lower the end cost of each unit to approximately
$59,000. HOME, Inc. has projected a monthly
PITI (principal,
interest, taxes, and insurance) of
$580 plus a $150 monthly association fee for maintenance etc. This will bring the total payment to $730 per
month, which is affordable to a family earning in the $25,000 to $30,000
range.
This will be the first low income
condominium project that the City has assisted with HOME funding. The HOME funding ensures that housing sold by
the DMMHA remains affordable and provides a homeownership opportunity for a
very low income segment of the community. HOME, Inc. has been an excellent
developer and provider of affordable housing opportunities in the City.
PREVIOUS COUNCIL ACTION(S): NONE
BOARD ACTION(S):
Date: March
5, 2008 - Neighborhood Revitalization Board
Roll Call
Number: N/A
Action: Support
of HOME funds for Rehabilitation Loan for HOME, Inc. Project, Bel Aire Commons
Date:
February 11, 2008 - Des Moines Municipal Housing Agency Governing Board
Roll Call
Number: 08-192
Action: Approving
conveyance of 5117/5119, 5118/5120, 5123/5125, 5124/5126, 5128/
ANTICIPATED ACTIONS AND FUTURE
COMMITMENTS: NONE
For more information on this and other agenda items,
please call the City Clerk’s Office at 515-283-4209 or visit the Clerk’s Office
on the second floor of City Hall,