HomeMy WebLinkAboutResolutions - 1982.08.05 - 13899August 5, 1982
Miscellaneous Resolution # 82233
BY: PUBLIC SERVICES COMMITTEE - James E. Lanni, Chairperson
IN RE: COMMUNITY DEVELOPMENT HOME IMPROVEMENT PROGRAM - lNCOME
ELIGIBILITY CHANGES
TO THE OAKLAND COUNTY BOARD OF COMMISSIONERS
Mr. Chairperson, Ladies and Gentlemen:
WHEREAS the Community Development Division has operated a Home Improvement
Program for housing rehabilitation since 1976 in order to maintain and improve our residential
neighborhoods; and
WHEREAS the intent of the Program is to assist low and moderate income persons; and
WHEREAS in designing the Home Improvement Program in 1976, Section 8 low and
moderate income limits were utilized to establish the. income ceiling for eligible low and
moderate income persons; and
WHEREAS the Section 8 low and moderate income limits in 1976 were identified as
$13,000 for a family of four; and
WHEREAS to achieve consistency, the Community Development Division recommends
the increase of income eligibility to 1982 Section 8 low and moderate income limits of $17,750
for a family of four; and
WHEREAS the Community Development Division Home Improvement Program procedures
include a mechanism to assure that low income persons and persons with the greatest needs receive
assistance first in accordance with the attached procedures dated 7-20-82; and
WHEREAS the Community Development Division has not increased income limits since
1976; and
WHEREAS the Community Development Housing Council ur=c-nimously approved the
attached recommended income eligibility changes; and
WHEREAS the Oakland County Community Development Advisory Council approved by
a 10 to 3 vote to recommend the attached income eligibility changes for approval to the Board
of Commissioners.
NOW THEREFORE BE IT RESOLVED that the increased income limits of $17,750 for a
family of four as recommended by the Community Development Housing Council and Advisory
Council on the attached be approved.
COMMITTEE VOTE:
Motion carried unanimously on a roll cal! vote.
BE IT FURTHER RESOLVED that a monthly written report of the program be submitted
to the Public Services Committee,
Mr. Chairperson, on behalf of the Public Services Committee, I move the adoption
of the foregoing resolution.
PUBLIC SERVICES COMMITTEE
3 Percent 6 Percent
$5,000
$35.82
RECOMMENDED
INCREASED INCOME AND INTEREST LIMITS
FOR
OAKLAND COUNTY HOME IMPROVEMENT PROGRAM
Introduction
Over the past several months the Community Development Division has considered
the increase of income limits and interest level for the Home Improvement Program.
This proposal is presented in response to the following observations:
a. In reviewing submitted applications for a 12 month period (January 1981 -
December 1981) of 131 cases submitted, 24 cases (18 percent) were over
the allowable $13,000.00 income limit yet within the Section 8 low and
moderate income limits.
b. In reviewing the development of the 1976 guidelines for the Home Improve-
ment Program, staff utilized 1976 Section 8 low and moderate income
limits to identify the $13,000 income ceiling. This income ceiling has
not been revised since:1976 and the 1982 Section 8 low and moderate
income limits identify the income ceiling as $17,750. To maintain con-
sistency the income ceilings should be increased to 1982 Section 8 low
and moderate income limits.
c. The original intent of the Home Improvement Program was to maintain a
housing rehabilitation program should the Community Development Block
Grant Program be eliminated. In reviewing the market cost of money (a
100% increase in market interest rates) it is necessary to increase from
a 3 percent to 6 percent interest rate to insure Program self sufficiency.
This will assure continuation of some form of Home Improvement Program
should funding for the Community Development Block Grant Program cease.
d. In reviewing monthly payment increases from 3 to 6 percent, the figures
below represent typical changes on a).00 percent installment loan with a
20 year teLm:
Principal $5,000 Principal
Payment $27.72 Payment
The above scenario represents the highest payment, that of a 100 percent
installment loan.
Proposal Design
In response to above observations, the Community Development Division recommends
the following revisions for the Home Improvement Program:
1. Adopt the 1982 Section 8 low and moderate income limits as identified
in Table 1 to maintain consistency with the original 1976 Program design.
Family Size Home Improvement Program
Income Limits
2
3
4
5
6
7
8
1 $14,250
15,400
16,550
17,750
18,100
18,450
18,850
19,200
Recommended Increased Income & Interest
Limits for Oakland County Home Improvement
Program (continued)
2. Revise the proration chart to refle4 the Increase in income limits.
(Table 2)
3. All installment loans will utilize an interest rate of 6 percent.
4. The following income limits are recommended:
Table 1
Table 2
Income Installment Loan Deferred Loan
$3,000 and under 100%
3,001 up to 4,000 10% 90%
4,001 up to 5,000 20% 80%
5,001 up to 6,000 30% 70%
6,001 up to 7,000 40% 60%
7,001 up to 8,000 50% 50%
8,001 up to 9,000 60% 40%
9,001 up to 10,000 70% 30%
10,001 up to 11,000 80% 20%
11,001 up to 12,000 90% 10%
12,001 up to 19,200 100%
Presently, the Community Development Division holds $2,466,597 for Home Improvement
Program loans. To insure that homeowners with the greatest needs are served first,
in July of 1981, the County implemented a quarterly allocation method and a priori-
tization committee. This system assures the availability of funds for a full
program year and insures that homeowners with greatest needs receive funding first.
The priorities reviewed by the committee include:
,age of applicant (priority to senior citizens)
.handi-capped status
•female-headed household
•construction/need priority (health „and 2,.17.ty issues are addressed first)
.lower Income homeowners
-2-
RecommendedIncreased Income & Interest
Limits for Oakland County Home Improvement
Program (continued)
The combination of quarterly allocations and the prioritization committee will
assure that those with greatest needs are satisfied first.
Conclusion
Implementation of this proposal will increase the local communities ability to
assist low and moderate income persons and to better meet objectives of the
Oakland County Home Improvement Program. These revisions will:
.encourage program consistency through use of 1982 Section 8 low and
moderate income guidelines.
.insure the availability of Home Improvement Program funding should
Community Development Block Grant funding cease
MEB/kjf -3-
7-20-82
OAKLAND COUNTY COMMUNITY1DEVELOPMENT
HONE IMPROVEMENT PROGRAM
1982-83 !
PROCEDURES
I. First contact with homeowners (phone calls).
A. Receptionist screen calls for eligibility:
1. what community do they live in?
2. receptionist refer calls to C.D. approval clerk or local C.D. Technician
for program description.
B. If homeowner meets guideline requirements, send application OCCD Form #101
revised. Applications are to be returned to the County or local community.
II. Receive Applications
A. Community technician assigns local control number.
NOTE: OCCD will assign program case number when completed application packet
is received at County office.
B. OCCD:
1. assign case number
2, start file
3. make two Rolodex Cards and enter 'to control book
4. eligibility technicians assign preliminary priority
5. forward card to inspection department
C. Request title and tax check from OCCD on HRForm #136 dated 8/81.
III. Property Inspection
A. Schedule appointment with homeowner to inspect property (general specifica-
tions), determine homeowner's wants and note health and safety needs.
B. Ask homeowner if they have any contractor(s) they wish to have bid and/or
if they would like to send the specs out themselves.
1. require a minimum of three (3) sealed bids from residential builders.
2. residential builder must meet OCCD insurance and license requirements.
C. Issue credit check information card to homeowner for credit check.
D. Photograph and prepare single paragraph narrative on existing condition
of dwelling to be improved.
E. Specification Priority - each item of the specifications will have a
priority classification. This classification will be noted on the cost
estimate sheet next to the corresponding item number of the item being
prioritized. The following priority classifications are listed in order
of importance.
H.S. 1 - Health and Safety/Imminent
H.S. 2 - Health and Safety
- Code
- Energy Conservation
G.I. - General Improvement
NOTE: "Health and Safety/Imminent" are for items requiring immediate
attention, i.e.; no heat, no water, no sanitary facilities, etc.
F. Prepare cost estimate, to be based on residential builder's prices, not
subcontractor's prices. (Home Tech Manual Restoration and Renovation cost
estimator.)
G. Estimate value of property - S.E.V. doubled (as is market analysis).
IV. Determine Priority
A. Local communities submit applications and work write-up to County.
B. County community 'development priority committee examines the application
and work write-up to determine the order of funding.
C. Points to check in determining funding priority (OCCD): "
1. Construction Priority
a, Health and Safety Imminent
b. Health and Safety
c. Code
d. Energy
e. General Improvement
2, Financial Priority
a. $0 - $3,000
b. $3,000 - $8,000
c. Greater than $8,000
3. Household Priority
a. Senior Citizen
b. Handicapped
c. Female head of household
d. Minority
2
4. Area Priority
V. Verifications - Homeowner to bring to office the following signed forms as
requested.
A. Mortgage verification of OCCD Form #104 or current statement from mortgage
company or land contract vendor (within last 30 days).
B. Statement of bank deposits on OCCD Form #103.
C. Income verifications:
1. Social security OCCD Form #106 or current budget letter
2. Employment OCCD Form 1/102
3. Social Services OCCD Form #106A or current budget letter
4. Pension OCCD Form #106A or current budget letter
5. Child support OCCD Form #106A
D. Copy of deed or land contract
E. Copy of divorce decree
F. Copy of current income tax statement
G. Property tax receipt
H. Insurance (cover page of homeowner's policy)
I. Other
IV. Bid Process
A. CDBG Program
1. Review cost estimates finalize written specifications
2. Have specs approved by OCCD
3. Set date bids must be si!lbmitted to office
B. Select contractors based on the following:
1. Homeowner's contractors (if any)
2. OCCD approved contractors list (equitable rotation of list by work
area required)
a. work areas selected by contractors
b. past experience with contractors
c. new contractors not yet sent bids
d. minority contractors
3
C. Mail contractors specifications (to include the following):
1. complete specifications for each job to be bid (FORMS: Oakland
County Rehabilitation Specifications)
2. itemized bid sheets for each job. OCCD Form #111
3. contractors letter stating jobs to be bid and bid opening time and date
4. "Notice to Contractors and Bidders" attached to OCCD Form #111 to be
filled out and returned with Form #111,
D, Mail specifications and bid opening notification to homeowner.
E. Conduct bid opening:
1, a minimum of two people from offices to be at bid opening.
2. everyone in attendance to sign bid opening OCCD Form #110.
3. open bids and record on bid open form OCCD Form #110.
4. bids are not accepted past designated opening time.
F. Verify bids
1. Add itemized bids to insure sum total of item amounts are equal to the
bid amount.
2. Check that bids are signed.
3. Check that all items and alternatives are bid on.
4. Failure to comply with the above Iresults in an invalid bid.
5. Notify contractors with invalid bids.
G. Well and septic installations will be negotiated with available respective
trade contractors.
H. Award Contract
1. Bids oust be within guideline maximum of $7,000.
2. If bids are above maximum:
a. Contact homeowner to discuss what items can be deleted from bids,
forward copies to contractors and homeowner.
b. Make up a deletion sheet subtracting the deleted items from each
contractors bid.
4
3. Award contract to low bidder if homeowner does not have a preference
of contractors.
4. Award contract to contractor that homeowner prefers, if their bid is
within 10% of the low bid (if the bid of the contractor that the home-
owner prefers is more than 10% above the low bid, they can still select
this contractor if they pay up front with a certified check the dif-
ference between the bid they want and 10% above the low bid.)
5. Send check request to OCCD office for CDBG Program Form #123 (Revised
7/81). Also, send Servicing Authorization OCCD Form #126 (Revised 7/81.)
6. Bidding contractors to be notified of bid results.
VII. Loan Settlement
A. Loan settlement, CDBG Program (prepare paperwork for closing; 1 original &
3 copies.)
1. Mortgage Note OCCD Form #120 (revised 7/81)
2. Mortgage OCCD Form #121,
3. Opportunity to Rescind OCCD Form 111)-980 (Doubleday)
4. Truth in Lending OCCD Form #119 1
5. Contract OCCD Form #112 (Revised 7/81)
6. Proceed to Work Order OCCD Form #113 (Revised 10/79)
7, MLX New Loan .00CD Form MLX (Revised 4/79)
B. Hold loan settlement (set up meeting Iwith homeowner and contractor)
1. Homeowner to sign original contract and all copies of loan papers.
2. Contractor to sign contracts.
3. Homeowner gets copy of all loan papers and contract.
4. Contractor gets a copy of contract; also completed Contractor's Check
Requisitions OCCD Form #135, for draws.
5. Hold proceed orders until rescision time is up, then mail Proceed to
Work Orders to contractor and homeowner.
6. Inquire how homeowner found out about program.
VIII. Construction
A. Inspect job during construction and notify contractor if work is not being
done properly.
B. Inspect job for 50% payment:
1. 60% of work should be completed for contractor to get 50% payment.
2. Fill out field inspection report to authorize contractor to be paid
50%, 30%, 20%.
3. New state statute waivers .and sworn statements to be collected at
Final inspection (80%).
C. Inspect problems that arise.
1. Consult with contractor and homeowner to determine solution to problem.
2. If extra work should be done:
a. ask contractor to submit a signed proposal.
b. and problem correction runs more than the 10% contingency, check
specifications to see if any item(s) can be deleted to make up
the difference in cost (if item(s) can be deleted, discuss with
homeowner the possibility of not doing the work in exchange for
the extra work needed).
c. Technician to cost estimate additional work for Change Order.
(OCCD Form #114 Revised 8/81)
d. Get change order signed by homeowner and technician.
e. Have change order signed by OCCD staff.
f. Tell contractor to do necessary changes.
NOTE: White copy to remain in OCCD office.
Yellow copy to local technician.
Pink copy to homeowner.
Gold copy to contractor..
TX. Close File
A. Check file for all necessary paperwork.
B. Send copies of paperwork that have not been sent to OCCD.
C, OCCD:
1. Close file in contract book and Rolodex.
2. Check to see that necessary paperwork is recorded.
3. Send servicing authorization to bank to close out account (to be done
two months after job completion).
X. 60 day follow-up
A. Site visit
B. Explanation of maintenance items to homeowner
C. Completion of evaluation
D. Summary overall project. (After completion narrative.)
NOTE: To be conducted by an OCCD Technician other than job technician.
KLS/kjf
7/20/82
7
5thday of / ) August
1/1111!!rir
liiPir 01140117P-
• ALLEN
Clerk/Register of Deeds
1982
Cour
#82233 A LIst 5, 1982
Moved by Lanni supported by Patterson the resolution be adopted.
AYES: Whitlock, Wilcox, Aaron, Caddell, Cagney, Calandra, DiGiovanni,
Doyon, Fortino, Gosling, Hobart, Lanni, Moffitt, Montante, Moore, Olsen, Page,
Patterson, Perinoff, Pernick, Peterson, Price. (22)
NAYS: None. (0)
A sufficient majority having voted therefor, the resolution was adopted.
STATE OF MICHIGAN)
COUNTY OF OAKLAND)
1, Lynn D. Allen, Clerk of the County of Oakland and having a
do hereby certify that I have compared the annexed copy of
Miscellaneous Resolution #822 33 adopted by the Oakland County Board of CommTs-,inners
at their meeting held on August 5, 1982
with the orginial record thereof now remaining in my office, and
that it is a true and correct transcript therefrom, and of the
whole thereof.
In Testimony Whereof, 1 have hereunto set my hand and affixed the
seal of said County at Pontiac, Michigan
this
