HomeMy WebLinkAboutResolutions - 2010.03.25 - 10186MISCELLANEOUS RESOLUTION #10056 March 25, 2010
BY: Planning and Building Committee. Jonn A. Scott, Chairperson
IN RE: ECONOMIC DEVELOPMENT AND COMMUNITY AFFAIRS - COMMUNITY AND HOME
IMPROVEMENT DIVISION —2010 HOME IMPROVEMENT PROGRAM GUIDELINE CHANGES
To the Oakland County Board of Commissioners
Chairperson, Ladies and Gentlemen:
WHEREAS, the Community and Home Improvement Division has administered the Home Improvement
Program since 1976 to improve approximately 200 single-family, owner-occupied homes per year for low
and moderate income persons in tne 51 communities participating in the Oakland County Community
Development Block Grant Program: and
WHEREAS, in Miscellaneous Resolutions #81237, #82233. #90201, #94082, #96151, #99122, #00142
and #04083 the Oakland County Board of Commissioners approved guidelines and amendments for
administering the Home Improvement Program, and
WHEREAS, the current Home improvement Program guidelines provide for three percent interest
installment loans and zero percent interest deferred loans - and
WHEREAS, due to the current real estate market conditions the Home Improvement Division
recommends the elimination of the three percent installment loans and that all current and future loans be
zero percent interest deferred loans; and
WHEREAS. previous guidelines were silent regarding how completed applications were processed; and
WHEREAS, the Home Improvement Division recommends that completed applications be processed in
the order in which received: and
WHEREAS, the current guidelines require that property taxes must be current: and
WHEREAS, the Home Improvement Division recommends that mortgages, if applicable, and property
taxes must be current; and
WHEREAS. applicants may secure only one loan through this program in any five-year period, and the
current guidelines did not indicate the beginning point of the five-year period; and
WHEREAS. the Home improvement Division recommends that the home improvement contract date
establishes the beginning of the five-year period; and
WHEREAS. the current Home Improvement Program guidelines indicate that the total property related
indebtedness after improvement shall not exceed twice the State Equalized Value (SEV): and
WHEREAS. the Home Improvement Division recommends that there must be enough equity in the
property to cover the cost of the home improvemert loan, and that equity is determined by multiplying
twice the State Equalized Value (SEV) and subtracting ex:sting property debt; and
WHEREAS, the current guidelines do not indicate the minimum amount of a loan; and
WHEREAS, the Home Improvement Division recommends that the home improvement program is a
substantial repair program and that the minimum loan amount is $7,000; and
WHEREAS, the current guidelines do not allow for exceptions for minimum equity and loan amount; and
WHEREAS, the Home Improvement Division recommends that equity exceptions and minimum loan
amounts may be granted by the approval of both the Oakland County Community & Home Improvement
Division Manager and Chief of Operations or in their absence their designee based upon extenuating
circumstances; and
WHEREAS, the current "Ineligible Improvements" reads as follows:
Examples of work that cannot be financed include, but are not limited to: special assessments,
patios. fencing, additions, accessory buildings, condominiums and mobile home improvements;
and
WHEREAS, the Home Improvement Division recommends that the new guidelines for "Ineligible
Improvements" reads as follows:
Examples of work that cannot be financed include, but are not limited to: patios, landscaping,
fencing. adeitions. new garages. accessory buileings and condominiums; and
WHEREAS. the current guidelines for "Eligible Improvements" reads as follows:
Examples of home improvement work that can be financed with a home improvement loan may
induce, but are not limited to, the following: wells. septic systems, structural repairs, plumbing,
electrical, heating, roofs, masonry. energy saving items, siding, windows, doors and barrier free
access, and
PLANNING & BUILDING COMMITTEE VOTE:
Motion carried unanimously on a roll call vote
WHEREAS. the Home Improvement Division recommends that the new "Eligible Improvements" reads as
follows:
Examples of home improvement work that can be financed with a home improvement loan may
include, but are not limited to, the following: wells. septic systems, structural repairs, plumbing,
electrical, heating, roofs, masonry, energy saving items, siding, windows, doors, special
assessments related to sewer ana water improvements and barrier free access.
Improvements can be made to an owner-occupied mobile home if the unit is on a permanent
foundation and the property is owned by the applicant.
WHEREAS, the current Home Improvement Program guidelines indicate that income requirements to be
eligible for the program are as follows:
The annual income is the gross amount of income of all adult (18 years of age or older)
household members that is autieipated Le be received during the coming 12-month period as
defined in HOME Regulation 24 CFR. Part 5 and the Technical Guide for Determining Income
and Allowances for the Home Investment Partnerships Act Program (HOME)
Income eligibility for the HOME Home Improvement Program is determined by using the current
HUD Section 8 income limits as reflected in Table 1. This table is used to determine income
eligibility based on household size and gross household income.
Home Improvement Program income limits will be periodically updated in accordance with HUD
revisions; and
WHEREAS. the Home Improvement Division recommends that the income requirements be changed to
the following:
Annual income is calculated as gross income of all adult household members (18 years of age or
older) that is- al iticipated to be receivea during the coming 12-month period, as defined in HOME
Regulation 24 CFR, Part 5 and the Technical Guide for Determining Income and Allowances for
the HOME Program.
Income eligibility for the Home Improvement Program is determined by using the current U.S.
Department of Housing and Urban Development (HUD) Section 8 income guidelines in Table 1.
Home Improvement Program income limits will be periodically updated in accordance with HUD
revisions.
WHEREAS, under the current guidelines addressing loan terms and conditions, due and payable term
"Mortgagor" is used to identify the person obtaining the home improvement loan; and
WHEREAS, the Home Improvement Division recommends that the term "Mortgagor' be replaced by the
words "home owner" or 'home owner(s) to clarify wnen the loan becomes due and payable; and
WHEREAS, in the current guidelines under "Inspections and Specifications" state:
Oaklana County Community and Home Improvement staff complete comprehensive home
inspections, monitor the construction through completion, recommel id tt,jiuLii1oi pdpients and
ensure that municipal, state and federal requirements are met; anc
WHEREAS. the Home Improvement Division recommends that this be changed to
'Compliance Review. Specifications and Contractor Payments"
Oaklana County Community & Home Improvement staff complete a condition and compliance
review of each home in accordance with home improvement standards, Staff complete work
specifications, monitor the construction through completion, recommend contractor payments and
ensure that municipal, state and federal requirements are met; anc
WHEREAS. under the current guiderines, a minimum of three (3) contractors, including one woman or
minority-owned business enterprise (W/MBE), are invited to bid each contract on a rotating basis; and
WHEREAS. the Home Improvement Division recommends that the numiner of contractors requested to
bid on each project be increased to six (6). and
WHEREAS. the Oakland County Community and Home Improvement Division Citizens Advisory Council
voted eight ayes and three nays to recommend approval of the Home Improvement Guidelines changes
as reflected in Attachment A.
NOW THEREFORE BE IT RESOLVED tnat the Oakland County Board of Commissioners approve the
Home Improvement Guideline changes in Attachment A that all current and future loans be zero percent
interest deferred loans; completed applications are processed in the order in which received: mortgages,
if applicable, and property taxes must be current; applicants may secure only one loan through this
program in any five-year period and the home improvement contract date establishes the beginning of the
five-year period; there must be enough equity in the property to cover the cost of the home improvement
loan and that equity is determined oy multipiying twice the State Equalized Value (SEV) and subtracting
existing property debt: tne home improvement program is a substantial repair program and that the
minimum loan amount Is $7,000; equity exceptions aria minimum oan amounts may be granted by the
approval of both the Oakland County Community & Home Improvement Division Manager and Chief of
Operations or in their" absence their designee based upon extenuating circumstances, eligible
improvements also include special assessments related to sewer and water improvements and mobile
home improvements if the unit is affixed to a permanent foundation and the property is owned by the
applicant; ineligible improvements also include landscaping and the construction of new garages; annual
income is calculated as gross income of al adult household members (18 years of age or older) that is
anticipated to be received during the coming 12-month period as defined in HOME Regulations 24 CFR,
Part 5 and the Technical Gulue for determining income and Allowances for the HOME Program; Income
Eligibility for tne Home Improvement Program is determined by using the current US. Department of
Housing and Urban Development (HUD) Section 8 income guidelines in Table 1; Home Improvement
Program income limits will be periodically updated in acccraance with HUD revisions; in the loan terms
and conditions the term e "mortgagor" be replaced by the words "home owner" or "home owner(s) to clarify
when the loan becomes due and payable: Oakland County Community & Home Improvement staff
complete a coind bon and complionce review of each home in accordance with home improvement
stardoms: staff complete work specifications, monitor the construction through completion, recommend
contractor payments and ensure that municipal. state and federal requirements are met and the number
of contractors requested to bid on each project be increased to
Chairperson. on beha'f of the Planning & Building Committee. I move the adoption of the foregoing
resolution.
LANNING AND DING COMMITTEE
Attachment A
OAKLAND COUNTY
COMMUNITY & HOME IMPROVEMENT DIVISION
HOME IMPROVEMENT PROGRAM GUIDELINES
AS OF MARCH XX, 2010
I. INTENT
The intent of the Oakland County Home Improvement Program (OCHIP) is to
improve single family owner occupied housing for low to moderate income persons
and improve residential neighborhoods. This program is an equal opportunity
program in accordance with federal regulations.
Home Improvement Standards
All work must be in compliance and conformance with the Michigan Residential
Code, the Residential Construction Performance Guidelines published by the
National Association of Home Builders, the Oakland County Community and Home
Improvement Division Home Improvement Guidelines and any and all codes
adopted by the governmental unit in which the property is located. The contractor
shall obtain and pay for all permits and licenses and shall give all notices, pay all
fees and comply with all laws, ordinances, rules and regulations in reference to the
work. If the work of the contractor or the contractor's subcontractors shall be done
contrary to such laws, ordinances, rules and regulations, without such notice, the
contractor shall bear all costs arising therefrom.
Form of Assistance to Homeowners
Home Improvement Program funds pay for the cost of improvements for single
family owner-occupied dwellings through either low or no interest loans.
II. APPLICATION PROCEDURE
A. Loan applications are available at offices of local jurisdictions participating in
the Oakland County Community Development Block Grant program and at
the Oakland County Community & Home Improvement Division, 250
Elizabeth Lake Road, Pontiac, Ml 48341-0414. Applications are also
available on the Oakland County web site at: www oakgov corr./ chi/ .
B. Applicants must submit a complete loan application with the required
documentation to the Oakland County Community & Home Improvement
Division. Applications may be submitted to local communities with home
improvement services staff.
C. Completed applications are processed in the order in which received.
III. ELIGIBILITY REQUIREMENTS
An Oakland County homeowner, who lives in his/her home and resides within the
boundaries of a local jurisdiction that is participating with the County in the
Community Development Block Grant (CDBG) program is eligible to apply for a
home improvement loan subject to the following conditions:
A. Eligible applicants are persons who own their home or are buying their home
that is financed with a mortgage.
B. The property to be improved must be the primary residence of the applicant.
Properties purchased for resale or rental purposes are not eligible.
C. Mortgages, if applicable, and property taxes must be current.
D. An applicant may secure only one loan through this program in any five-year
period. The home improvement contract date establishes the beginning of
the five year period.
IV. LOAN LIMITATIONS
A. There must be enough equity in the property to cover the cost of the home
improvement loan. Equity is determined by multiplying twice the State
Equalized Value (SEV) and subtracting existing property debt.
B. The home improvement loan program is a substantial repair program. The
minimum loan amount is $7,000.
C. Equity exceptions and minimum loan amounts may be granted by the
approval of both the Oakland County Community & Home improvement
Manager and Chief of Operations or in their absence their designees based
upon extenuating circumstances.
V. ELIGIBLE IMPROVEMENTS
Examples of home improvement work that can be financed with a home
improvement loan may include, but are not limited to, the following: wells, septic
systems. structural repairs, plumbing, electrical, heating, roofs, masonry, energy
saving items, siding, windows, doors, special assessments related to sewer and
water improvements and barrier free access.
Improvements can be made to an owner occupied mobile home if the unit is on a
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permanent foundation and the property is owned by the applicant.
VI. INELIGIBLE IMPROVEMENTS
Examples of work that cannot be financed include, but are not limited to: patios,
landscaping, fencing, additions, new garages, accessory buildings and
condominiums.
VII. INCOME REQUIREMENTS
Annual income is calculated as gross income of all adult household members (18
years of age or older) that is anticipated to be received during the coming 12-month
period, as defined in HOME Regulation 24 CFR, Part 5 and the Technical Guide for
Determining Income and Allowances for the HOME Program.
Income eligibility for the Home Improvement Program is determined by using the
current U.S. Department of Housing and Urban Development (HUD) Section 8
income guidelines. Home improvement Program income limits will be periodically
updated in accordance with HUD revisions.
VIII. LOAN TERMS AND CONDITIONS
The Home Improvement Program provides a no interest deferred loan.
A. DEFERRED LOAN The principal sum of a Deferred Loan is to be repaid at a
future time and shall become due and payable when the homeowner no
longer lives on the premises. There are no payments or interest charged on
the principal.
DUE AND PAYABLE TERMS The Deferred Loan shall become due and
payable under the following terms and conditions.
1. The home owner transfers any interest in the property,
except as prohibited by law.
2. The home owner moves, rents, or leases the property.
3. Upon death of the home owner(s).
4. Failure of the home owner to maintain adequate fire and hazard
insurance and flood plain insurance, where applicable, to cover the
debt incurred by the loan and any pre-existing property debt.
IX. COMPLIANCE REVIEW, SPECIFICATIONS AND CONTRACTOR PAYMENTS
Oakland County Community & Home Improvement staff complete a condition and
compliance review of each home in accordance with I -.ome improvemert standards.
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Staff complete work specifications, monitor the construction through completion,
recommend contractor payments and ensure that municipal, state and federal
requirements are met.
X. BIDS
A. Contractors qualified for the OCHIP Contractor List are permitted to bid
projects through a formal bidding process. A minimum of six (6) contractors,
including one woman or minority owned business enterprise (W/MBE), are
invited to bid each contract on a rotating basis.
B. Bids are awarded to the lowest responsible bidder. A homeowner may select
a contractor whose bid is higher providing the homeowner pays the
difference between the lowest bid and selected bid.
Xl. CONTRACTS
A. Home Improvement contracts are between the homeowner and the
contractor and must be signed by both parties prior to work being initiated.
B. Contracts should not exceed the maximum loan amount of $18,000.
Exceptions may be granted based on extenuating circumstances determined
by Oakland County Home Improvement Program staff,
A $2,000 contingency amount is available for unforeseen problems and must
be authorized in writing by the homeowner and Oakland County Home
Improvement Program staff.
XII. MORTGAGE AND NOTE
A. Home improvement loans are secured by a mortgage. A mortgage is a lien
placed on the property to guarantee repayment of the loan.
B. The mortgage is recorded with the Oakland County Clerk/Register of Deeds.
C. The note explains the repayment terms and conditions of the loan.
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I rerson
8 Person $75,000
TABLE 1
MAXIMUM LOAN AMOUNT: $18,000
March 2009
GROSS HOUSEHOLD INCOME LIMITS
Federal Regulations require us to anticipate income, using the household's current
circumstances to project future income. WE ARE TO ASSUME THAT TODAY'S
CIRCUMSTANCES WILL CONTINUE FOR THE NEXT 12 MONTHS.
Current gross income is not last year's income. Gross income includes the earnings of all
adult household members plus the benefits of all household members. Benefits include
child support, Social Security benefits, alimony, etc.
1 HOUSEHOLD SIZE
Person
MAXIMUM INCOME
39.750
2 Person $45,450
3 Person $51,100 i
4 Person $56,800
r 5 Person $61.350
6 Person $65,900 ...a.
Program guidelines are subject to periodic changes without notice.
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Resolution #10056 March 25, 2010
Moved by Scnwartz supported by Potter the resolutions (with fiscal notes attached) on the amended
Consent Agenda be adopted with accompanying reports being accepted.)
AYES: Burns, Capello, Coleman, Coulter, Douglas, Gershenson, Gingell, Gosselin, Greimel,
Hatchett, Jackson, Jacobsen, Long, McGillivray, Middleton, Nash, Potter, Potts, Runestad,
Schwartz, Scott, Taub, Zack, Bullard. (24)
NAYS: None. (C)
A sufficient majority having voted in favor, the resolLtions (with fiscal notes attached) on the amended
Consent Agenda were aoopted (with accompanying reports being accepted)
11 HEREBY APPROVE TrIE FOREGOING RESOLUTON
ACTM PURSUANT TO 1973 PA 139
STATE OF MICHIGAN)
COUNTY OF OAKLAND)
I, Ruth Johnson, Clerk of the County of Oakland, do hereby certify that the foregoing resolution is a true
and accurate copy of a resolution adopted by the Oakland County Board of Commissioners on March 25,
2010, with the original record thereof now remaining in my office.
In Testimony Whereof, have hereunto set my hand ana affixed the seal of the County of Oakland at
Pontiac, Michigan this 25th day of March, 2010.
eat
Ruth Johnson, County Clerk