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HomeMy WebLinkAbout79-217EJC:adg 12/12/79 RESOLUTION NO. 79-217 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA ADOPTING A COMPREHENSIVE RESIDENTIAL REHABILITATION FINANCING PROGRAM PURSUANT TO THE MARKS-FORAN RESIDENTIAL REHABILITATION ACT OF 1973 BE IT RESOLVED by the City Council of the City of Santa Ana that the Comprehensive Residential Rehabilitation Finance Program as hereinafter set forth is adopted pursuant to the "Marks-Foran Residential Rehabilitation Act of 1973." A. DEFINITIONS 1. Unless herein otherwise expressly provided, the terms used in this Comprehensive Residential Rehabilitation Financing Program shall be as defined in the "Marks-Foran Residential Rehabilitation Act of 1973" (Part 13, commencing with Section 37910, of Division 24 of the Health and Safety Code of the State of California, hereinafter called the "Act"). Be ELIGIBILITY FOR SELECTION AS RESIDENTIAL REHABILITATION AREA 1. An area shall be selected as a residential rehabilitation area if the City Council of the City of Santa Ana (herein called the "City Council") by resolution adopted at a duly noticed public hearing defines the boundaries of the residential rehabilitation area and makes the following findings with respect thereto: a. There are a substantial number of dete- riorating structures in the area which do not conform to community standards for decent, safe, sanitary housing; b. Financial assistance from the City of Santa Ana for residential rehabilitation is necessary to arrest the deterioration of the area; and c. Financing of residential rehabilitation in the area is economically feasible. 2. A redevelopment project area now existing or hereafter created pursuant to the Community Redevelopment Law (Part 1 of Division 24 of the of the Health and Safety Code of the State of California) is eligible for selection as a residential rehabilitation area and the foregoing findings are not required for such area. C. SELECTION PROCESS 1. When the City Council has determined an area as a proposed residential rehabilitation area, the City Council shall provide for citizen participation in determining whether the area shall be selected as a residential rehabilitation area and to develop a plan for public improvements and rules and regulations for implementation of the proposed residential rehabilitation program, which shall include rules and regulations for RESOLUTION NO. 79-217 PAGE TWO encouraging participation by minority contractors. Such citizen participation shall be provided for in the following manner and order. a. The City Council hereby designates the Executive Director of the Housing Authority of the City of Santa Ana as the planning or rehabil- itation official (the "designated official") to conduct the public meetings and consultations referred to hereinafter. b. The City Council hereby appoints the Housing Advisory Commission of the City of Santa Ana as the citizens advisory board which is composed of representatives of resident owners and resident tenants in the proposed residential rehabilitation area. c. The designated official shall conduct a public meeting, which may be continued from time to time, at a time and place or at times and places convenient to residents and property owners within the proposed residential rehabilitation area. At such meeting or meetings, the designated official shall review the boundaries of the pro- posed residential rehabilitation area, the pro- posed residential rehabilitation program, and the need for senior citizen housing within the juris- diction of the City, and shall provide full opportunity for such residents and property owners to participate and make recommendations with respect to such boundaries and program and any changes or modifications thereto. d. The designated official shall consult with the citizens advisory board and, in the con- sultation process, cause to be developed a plan for public improvements and rules and regulations for implementation of the proposed residential re- habilitation program. e. The designated official, following the public meetings and consultations with the citizens advisory board, shall file with the City Council the plan for public improvements, the rules and regulations, and a summary of the results of such public meetings. f. The City Council shall hold a public hearing duly noticed as hereinafter provided at which time the proposed boundaries and the proposed residential rehabilitation program, and the summary of the public meeting shall be presented and re- viewed and full opportunity given to the residents and property owners to express themselves with re- spect thereto. At such public hearing, the City Council shall consider the criteria which give priority to rehabilitation of senior citizen housing. 2. Notices of the time and place of the public hearing, containing information relating to the boundaries of the proposed residential rehabilitation area and a RESOLUTION NO. 79-217 PAGE THREE general description of the proposed residential rehabilitaiton area and a general description of the proposed residential rehabilitation program, shall be disseminated prior to the date thereof by an appropriate method to be determined by resolution of the City Council consistent with Section 37912 of the Act. De SELECTION OF RESIDENTIAL REHABILITATION AREA 1. Following conclusion of the public hearing, the City Council may, by resolution, select the residential rehabilitation area and describe the boundaries thereof. By the same or separate resolution or resolutions, the City Council shall: a. adopt rules implementation of the program; and regulations for the residential rehabilitation b. adopt a plan for public improvements necessary to successful rehabilitation of the re- habilitation area; c. express a commitment that, subject to budgetary and fiscal limitations of the City of Santa Ana, rehabilitation standards will be enforced in ninety five percent (95%) of the residences in the residential rehabilitation area; and d. express a commitment that a plan for public improvements necessary to successful re- habilitation of the residential rehabilitation area will be developed, with citizen participation, for each residential rehabilitation area and that the plan for public improvement shall be adopted by the City Council prior to the financing of residential rehabilitation in any residential rehabilitation area, together with a commitment that, subject to budgetary and fiscal limitations, such plan will be carried out by the City of Santa Ana. E. FINANCING GUIDELINES AND LIMITATIONS 1. Pursuant to Sections 37917 and 37921 of the Act, the City is empowered to acquire and hold interests in land, including deeds of trust, as security for financing residential rehabilitation and to pledge the same as security for repayment of bonds issued under the Act. It is hereby determined that such interests in land include, without limitation, mortgages insured under Title II of the National Housing Act and mortgages guaranteed by the Veterans Administration under the Serviceman's Readjustment Act of 1944, as amended (herein called "insured mortgages"), and that the acquisition of such insured mortgages is necessary and convenient for the financing of residential rehabilitation under the Act. 2. The financing of residential rehabilitation of existing structures in a residential rehabilitation area shall be subject to the following limitations: RESOLUTION NO. 79-217 PAGE FOUR a. Unless insured or guaranteed in whole or part by an instrumentality of the United States or the State of California or by a person licensed to insure loans in this state, outstanding loans on the property to be rehabilitated, including the amount of the loans for rehabilitation, shall not exceed eighty percent (80%) of the anticipated after-rehabili- tation value of the property to be rehabilitated, except that the City of Santa Ana may authorize loans, which are neither insured nor guaranteed, of up to ninety five percent (95%) of the antici- pated after-rehabilitation value of the property if (1) such loans are made for the purpose of rehabilitating the property for residential purposes (2) there is demonstrated need for such higher limit, and (3) there is a high probability that the value of the property will not be impaired during the term of the loan. Outstanding loans on property to be rehabilitated may be authorized up to ninety-seven percent (97%) of the antici- pated after rehabilitation value of the property, if the person to whom the loan is made is of low income, as defined in California Health and Safety Code S 50093. A nonprofit corpor- ation incorporated pursuant to Part I (commencing with Section 9000) of Division 2 of Title 1 of the Corporation's Code or a cooperative housing corporation, as defined in subdivision (a) of Section 17625 of the Revenue and Taxation Code, may be authorized a loan not exceeding either ninety eight percent (98%) or one hundred percent (100%) of the estimated after-rehabilitation value or of its total development cost, according to the standards for nonprofit housing sponsors set forth in Section 50958 of the Health and Safety Code of the State of California, if the dwelling units within the residence rehabilitated with financing under the Act are committed for the period during which the loan is outstanding for occupancy by persons or families who are eligible for financial assistance specifically provided by a governmental agency for the benefit of occupants of the residence. b. The maximum repayment period for such residential rehabilitation loans shall be forty (40) years or four/fifth (4/5) of the economic life of the structure, whichever is less. c. The maximum amount loaned for rehabili- tation, exclusive of costs of acquisition, or exclusive of refinancing, for each dwelling unit and for each commercial unit which is, or is part of, a residence shall be forty five thousand dollars ($45,000). d. No more than twenty percent (20%) of any loan for such residential rehabilitation shall be used for residential rehabilitation which is not re- quired under the City of Santa Ana's property rehabilitation standards, except that in the case of owner-occupied one to four dwelling unit properties, up to forty percent (40%) of the loan for such residential rehabilitation may be used for residential rehabilitation not required under the city of Santa Ana's property rehabilitation standards. RESOLUTION NO. 79-217 PAGE FIVE e. Loans shall not be made for the purpose of refinancing the outstanding indebtedness of a participating party with respect to property which is subject to residential rehabilitation, or for financing the acquisition of property which has been, or is to be subject to residential re- habilitation, unless the cost, including in such cost any amounts previously expended for residential rehabilitation of that property by a participating party, within a residential rehabilitation area or a redevelopment project area established at the time of such expenditure, of meeting the rehabilitation standards is at least twenty percent (20%) of the principal amount of the loan. F. RESIDENTIAL INFILL CONSTRUCTION 1. The City Council hereby authorizes new construction in the form of residential infill construction as defined in said Act as an integral part of this Residential Rehabilitation Financing Program. 2. The guidelines for financing infill construction shall be subject to the limitations: residential following a. unless insured or guaranteed in whole or in part by an instrumentality of the United States or the State of California or by a person licensed to insure loans in this state, outstanding loans on the property, including the amount of the loans for residential infill construction, shall not exceed eighty percent (80%) of the anticipated value of the property, following completion of the construction, except that the City Council may authorize loans, which are neither insured nor guaranteed, of up to ninety percent (90%) of the anticipated value of the property following completion of the construction, if such loans are made for the purpose of con- struction residences containing two or more dwelling units. A nonprofit corporation in- corporated pursuant to Part I (commencing with Section 9000) of Division II of Title I of the Corporation's Code or a cooperative housing corporation, as defined in Subdivision (a) of Section 17265 of the Revenue and Taxation Code, may be authorized a loan not exceeding one hundred percent (100%) of the estimated value of the property following completion of con- struction, if the dwelling units constructed with financing under the Act are committed for the period during which the loan is outstanding for occupancy by persons or families who are eligible for financial assistance specifically provided by a governmental agency for the benefit of occupants of the residence. b. The maximum repayment period for loans for residential infill construction shall be forty (40) years or four-fifths (4/5) of the economic life of the structure, whichever is less. RESOLUTION NO. 79-217 PAGE SIX Go PURCHASE OF RESIDENCE 1. Pursuant to Section 37912 of the Act, the City Council hereby authorizes financing or refinancing the cost incurred by a participating party in acquiring real property for the purpose of residential rehabilitation, including infill construction, and financing the acquisition of residences within the residential rehabilitation area which have been previously rehabilitated or constructed with financing under the Act as an integral part of this residential rehabilitation. 2. The guidelines for financing the purchases of residences previously rehabilitated or constructed with financing under the Act shall be subject to the following limitations: a. Purchasers of single family dwellings eligible to receive such financing shall be persons or families of low or moderate income. b. Ail rental dwelling units in the residence financed shall be committed for the period during which the loan is outstanding for occupancy by persons and families of low or moderate income, as defined by Section 50093 of the Health and Safety Code. Upon recordation of the deed, other instrument of conveyance, lease, or instrument of financing in the office of the County Recorder of Orange County, the rental dwelling units reserved for occupancy for persons of low income shall remain for such occupancy for not less than thirty (30), nor more than fifty-five (55), years. Such recorded agreement shall be binding upon successors in interest. c. Unless insured or guaranteed in whole or in part by an instrumentality of the United States or the State of California or by a person licensed to insure loans in this State, outstanding loans on the property to be acquired shall not exceed eighty percent (80%) of the value of the property, except that the City Council may authorize loans, which are neither insured nor guaranteed, of up to ninety percent (90%) of the value of the property if such loans are made for the purpose of financing residences containing two or more dwelling units. A nonprofit corporation incorporated pursuant to, or otherwise made subject to the provisions of, Part II (commencing with Section 5110) of Division 2 of Title I of the corporation's Code or a cooperative housing corporation, as defined in subdivision (a) of Section 17265 of the Revenue and Taxation Code, may be authorized a loan not exceeding one hundred percent (100%) of the value of the property, if the dwelling units within the residence are committed for the period during which the loan is outstanding for occupancy by persons or families who are eligible for financial assistance specifically provided by a governmental agency for the benefit of occupants of the residence. d. The maximum repayment period for acquisition loans shall be forty (40) years or four-fifths (4/5) of the economic life of the property, whichever is less. RESOLUTION NO. 79-217 PAGE SEVEN e. No more than thirty five percent (35%) of the aggregate principle amount of all loans made in the residential rehabilitation area may be for residential infill construction or acquisition financing. REHABILITATION OF RESIDENCES OUTSIDE OF RESIDENTIAL REHABILITATION AREAS 1. Rehabilitation of residences located outside of residential rehabilitation areas is authorized when the following qualifications are met: a. The City Council determines that the residence proposed for rehabilitation is located in an area determined by the City Council to be a stable and viable residential neighborhood; and b. The City Council determines that re- habilitation of the proposed residence is econom- ically feasible; and c. Dwelling units rehabilitated within the residence with financing under the Act are committed for the period during which the loan is outstanding for occupancy by persons or families who are eligible for financial assistance specifically provided by a governmental agency for the benefit of occupants of the residence. 2. Prior to selection of such a residence, the designated official shall: a. consult with the affected owners and residents to provide an opportunity for partici- pation by them in the designation of dwelling units to be rehabilitated and in the planning of the proposed rehabilitation, and b. prepare and file with the City of Santa Ana a recommended rehabilitation plan for such proposed residence, and c. following the filing of such recommended rehabilitation plan, hold an administrative hearing thereon, notice of which shall be given (i) at least seven (7) days prior thereto by mail to the affected owner at the address shown on the latest equalized assessment roll; (ii) by publication one time in a newspaper of general circulation circulated in the proposed residential rehabilitation area; and (iii) by such other means of dissemination as may be deemed appropriate by the designated official or his designee to reach the residents of the proposed residential re- habilitation area. 3. Following the conclusion of the administrative hearing, the City Council may, by resolution, select such proposed residence for rehabilitation upon determining that such residence qualifies as provided hereinabove in Section 1 of Part H and approving the rehabilitation plan. RESOLUTION NO. 79-217 PAGE EIGHT 4. The financing or residential rehabilitation of residences outside of residential rehabilitation areas shall be subject to the limitations provided in Part E hereinabove. REHABILITATION STANDARDS: ADMINISTRATIVE GUIDELINES AND MORTGAGEES' PROCESSING AND SERVICING GUIDES 1. Properties rehabilitated pursuant to the provisions of this Comprehensive Residential Rehabilitation Financing Program shall be rehabilitated to the residential rehabilitation standards of the City of Santa Ana. 2. The residential rehabilitation program shall be implemented in accordance with Rules and Regulations to be hereinafter adopted after consultation with the citizens advisory board, as required by the Act. 3. Mortgage loans purchased by the City of Santa Ana or its agent pursuant to this Comprehensive Residential Rehabilitation Financing Program shall be purchased in accordance with the provisions of the Mortgage Selling Contract Supplement, as amended from time to time in the discretion of the City Council, and shall be serviced in accordance with the Mortgage Servicing Contract and Mortgage Servicing Contract Supplement, all as provided in said Rules and Regulations. 4. Any residence which is rehabilitated with financing obtained under the Act shall be open upon sale or rental of any portion thereof, to all persons regardless of race, color, religion, national origin or ancestry. All contractors and subcontractors engaged in residential rehabilitation financed under the Act shall provide equal opportunity for employment, without discrimination as to race, sex, marital status, color, religion, national origin or ancestry. All contracts and subcontracts for residential rehabilitation financed under the Act shall be let without discrimination as to race, sex, marital status, color, religion, national origin or ancestry. It is the policy of the City Council of the City of Santa Ana to encourage participation by minority contractors. J. MISCELLANEOUS 1. This program, being necessary for the welfare of the inhabitants of the City of Santa Ana, shall be liberally construed to effect its purposes. RESOLUTION NO. 79-217 PAGE NINE 2. The designated official shall submit an annual report to the State Department of Housing and Community Development as required by Section 37913 of the Act. ADOPTED this l?th day of December , 1979, by the following vote: AYES: COUNCILMEN: NOES: COUNCILMEN: Bricken, Griset, Luxembourger, Markel, Serrato, Ward, Yamamoto None ABSENT: COUNCILMEN: N~ne ATTEST: APPROVED AS TO FORM: KEITH L. GOW CITY ATTORNEY