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HomeMy WebLinkAboutResolutions - 1987.07.23 - 18031MISCELLANEOUS RESOLUTION NO. 87180 DATE: 7/23/87 Richard D., thn, Jr.;Chairperson TREGOING RESOLUTION BY: PUBLIC SERVICES COMMITTEE - RICHARD D. KUHN, JR., CHAIRPERSON IN RE: COMMUNITY DEVELOPMENT DIVISION - Criteria and Procedure for the Reallocation of Recaptured 1985 and 1986 Commercial Assistance Program Funds TO THE OAKLAND COUNTY BOARD OF COMMISSIONERS Mt. Chairperson, Ladies and Gentlemen WHEREAS Oakland County has been a recipient of Community Development Block Grant funds from the U.S. Department of Housing and Urban Development since 1974 and has operated a residential rehabilitation proqtaM since 1975; and WHEREAS the County of Oakland by Miscellaneous Resolution #82283 of September 21, 1982 adopted the basic concept of utilizing Community Development Block Grant funds to leverage private financial resources for the rehabilitation of residential and commercial property; and WHEREAS the County of Oakland by Miscellaneous Resolutions #84239 of August 30, 1984 and #87134 of May 28, 1987 approved the Rehabilitation Leveraging Agreement with Manufacturers National Bank of Detroit for a program of financing commercial property rehabilitation; and WHEREAS the County of Oakland by Miscellaneous Resolutions #85158 of May 23/ 1985 and #86037 of February 27, 1986 designated communities and funding allocations for the 1985 and 1986 Commercial Assistance Programs; and WHEREAS the County of Oakland by Miscellaneous Resolution #85118 of April 18, 1985 approved general Criteria and Procedures for the recapture and reallocation of unused CAP funds; and in accordance with the provisions of that Resolution the Oakland County Community Development Division has recommended in a companion resolution the recapture of $101,490.75 in 1985 CAP funds and $31,241.25 in 1986 CAP funds; and WHEREAS the Oakland County Community Development Division has recommended the Criteria and Procedure for the reallocation of the recaptured CAP funds as specified in Attachment A; and WHEREAS the Community Development Citizens Advisory Council recommends approval by a unanimous vote (15-0), of the Reallocation Criteria and Procedure as specified in Attachment A. NOW THEREFORE BE IT RESOLVED that the Oakland County Board of Commissioners hereby approves the Criteria and Procedure for the reallocation of recaptured 1985 and 1986 CAP funds. BE IT FURTHER RESOLVED that the Oakland County Community Development Division is authorized to utilize the reallocation Criteria and Procedure approved herein to prepare funding recommendations for the reallocation of 1985 and 1986 CAP funds with final approval to be made by the Oakland County Board of Commissioners. Mt. Chairperson, on behalf of the Public Services Committee, I move the adoption of the foregoing resolution. ATTACHMENT A CRITERIA AND PROCEDURE FOR THE REALLOCATION OF RECAPTURED 1985 AND 1986 COMMERCIAL ASSISTANCE PROGRAM (CAP) FUNDS The Oakland County Community Development Division, with approval of the Community Development Citizens Advisory Council, the Public Services Committee and the Oakland County Board of Commissioners will reallocate recaptured 1985 and 1986 Commercial Assistance Program (CAP) funds as follows: A. 70% of the recaptured funds will be allocated to qualified communities not currently participating in either the 1985 or the 1986 CAP programs. B. 30% of the recaptured funds will be allocated to currently participating communities which have depleted 100% of their CAP funds by June 30, 1987 and submit additional loan applications to OCCD by August 30, 1987. PART A - 70% to Communities Not Currently Participating in CAP Al. Unfunded 1985 Runner-up Community - In accordance with Miscellaneous Resolution #85118 of April 18, 1985, the first priority for funds is to be given to any community which applied for CAP in 1985 and has not yet received funds. Royal Oak Township is the only unfunded 1985 applicant community. This is because the community did not apply for the 1986 CAP program. In anticipation of the reallocation of recaptured funds, OCCD notified Royal Oak Township on April 14, 1987 that it would have an opportunity to participate in CAP upon completion of an updated CAP community application. The application will document the local demand for CAP loans and verify how the Township meets the eligibility qualifications to participate in CAP. That application is due to OCCD from Royal Oak Township by July 13, 1987. The Township is entitled to receive $10,830 in CAP funds, enough to support $59,203 in total rehabilitation costs. This is the same amount that the other 1985 CAP non-target runner-up communities were allocated in the summer of 1985. A2. New Communities - Second priority will be given to communities which have not participated in either the 1985 or 1986 CAP programs. On April 8, 1987, OCCD conducted a 1987 CAP Community Application Workshop to which all the non-participating communities were invited. Five (5) communities attended the workshop during which the program and the community application were explained. The communities were informed that funds would likely become available during the late summer of 1987. Applications have been submitted from four (4) communities. If the application from Royal Oak Township documents a demand for CAP financing in excess of the $10,830 available to it as a 1985 "runner-up", then the Township will be considered as a new applicant in this category. A-2 The 1987 CAP community application utilizes the minimum community eligibility qualifications adopted for the 1986 CAP program by the Board of Commissioners through Miscellaneous Resolution #85308 of October 24, 1985. A3. Allocation Formula - The allocation formula approved by Miscellaneous Resolution #85308 of October 24, 1985 for the 1986 CAP program will be utilized once again to calculate the funding allocation to the new communities for 1987. A3a. Each community will be allocated a minimum threshold amount of CAP funds to support $75,000 worth of rehabilitation. Currently, that amount is $13,878. Due to expected funding limitations, the 1987 threshold amount has been lowered to $75,000 from the $100,000 threshold used in 1986.. A3b. The amount remaining after the minimum thresholds have been calculated would be divided in half; one-half to be distributed according to the communities' scores on field visits by a special CAP Review Team, and the other half to be distributed on the basis of the demand for CAP financing as documented by the "Statements of Interest to Participate in CAP" submitted to OCCD as part of the communities' CAP applications. A3bi. Field Visit - OCCD will calculate the percentage that each community's field visit score represents of the total points scored by all the applicant communities. This same percentage will then be applied to one-half of the balance of CAP funds remaining after the minimum threshold amounts are determined from step A3a. This section has been modified from the 1986 CAP program such that only the field visit will be scored and not the written application. A3bii. Financing Demand - OCCD will calculate the percentage that each community's documented demand for CAP financing represents of the total demand for rehabilitation financing estimated by all the applicant communities. This same percentage will then be applied to one-half of the balance of the CAP funds remaining after the minimum threshold amounts are determined from step A3a. In summary, a new CAP participating community's CAP allocation will consist of three parts - a minimum threshold amount to support $75,000 worth of rehabilitation; an amount derived from their score on a field review; and an amount based on their demand for CAP loans. Letter of Agreement - Each new community's CAP allocation will be incorporated into their Letter of Agreement with OCCD. Upon execution of the Letter of Agreement, the community will have 18 months during which the businesses and property owners in the CAP target area may apply for CAP loans. The Board approved recapture policy (Miscellaneous Resolution #85118 of April 18, 1985), which was made operational by OCCD's recapture guidelines (February, 1987 - See Exhibit #1) will be used to monitor local progress and recapture funds if necessary. PART B - 30% to Current CAP Participating Communities Which Have Depleted 100% of Their CAP Funds 30% of the recaptured funds will be made available as a pool of funds for rehabilitation projects in the 1985 and 1986 CAP communities which have "depleted" 100% of their CAP funds by June 30, 1987. "Depletion" means any combination of: 1) actual disbursement of CAP loan proceeds by OCCD to the borrower upon project completion; 2) reservation of funds upon a loan closing; this signals the start of construction; 3) commitment of funds upon an OCCD loan approval; 14) application for funds to OCCD upon local project approval by the CAP Committee. Contingent upon fund availability, the communities which have "depleted" their funds as noted above may receve an additional CAP allocation based on their past performance in using their CAP funds. These communities will be rank ordered, first to last, according to how quickly each community "depleted" its CAP allocation since the date of its CAP Letter of Agreement with OCCD. The community using up its funds in the least amount of time will be ranked first and so on. In addition to any loan applications already on hand at OCCD, these communities may solicit and submit additional loan applications to OCCD by August 30, 1987. If necessary, each local CAP Committee will determine the priority for CAP financing among their CAP loan applications. OCCD will commit funds to one project at a time, starting with the first ranked community and moving sequentially through the communities' first priority projects. If funds are sufficient, OCCD will proceed sequentially again through the communities' second ranked projects, one at a time, and so until the funds run out. Communities may receive supplemental CAP funds up to a maximum of the amount needed to support $200,000 worth of rehabilitation (currently $37,008 in CAP dollars). Any funds not used will be returned to the CDBG contingency account for future reallocation. If due to project or applicant delays, °CC - not Irian commitments on these projects within 180 days after the Board of Commissioners authorizes the reallocation of the funds, then any balances will be recaptured to the CDBG contingency account for future reallocation. A-3 A COUNTY MICHIGAN DEPARTMENT OF PUBLIC WORKS Daniel T. Murphy, Oakland C-ounty Executive COMMUNITY DEVELOPMENT Kenneth R. Patterson - Manager February, 1987 A-4 ExecutIve Office euilding 1200 North Telegraph Road Pontiac, Michigan 48053 Attachment A - Exhibit 1 COMMERCIAL ASSISTANCE PROGRAM (CAP) Criteria for the Recapture of Unused CAP Funds In accordance with Oakland County Board of Commissioners' Miscellaneous Resolution #85118 of April 18, 1985, all or a portion of a community's CAP funding allocation will be recaptured when insufficient CAP performance so warrants. Such insufficient performance is indicated when a community does not meet its established quarterly performance goals as specified in their CAP Letter of Agreement with Oakland County. The Board of Commissioners' approved CAP recapture procedures are made operational through the following indicators of loan application activity. 1. At least one complete, locally approved CAP loan application must be submitted to the Oakland County Community Development Division by the end of the 9th month of the community's 18 month CAP program period. When this condition is not met, 25% of the community's CAP funding allocation will be recaptured. 2. By the end of the 12th month, the *active loan applications and *active loan commitments must represent at least 50% of the community's CAP funding allocation. When this condition is not met, 25% of the community's CAP allocation will be recaptured. 3. By the end of the 15th month, the *active loan applications and *active loan commitments must represent at least 75% of the community's CAP funding allocation. When this condition is not met, 25% of the community's CAP funding allocation or the balance if less, will be recaptured. 4. By the end of the 18 month CAP program period, the *active loan applications and the *active loan commitments must represent 100% of the community's CAP allocation. If this condition is not met, then the balance will be recaptured. * NOTE - An active loan application means one that has been locally approved, submitted to Oakland County. Community Development, and has neither been withdrawn by the applicant or denied by a financial institution. An active loan commitment means one that has been issued by a financial institution and/or Oakland County Community Development for a project that has not withdrawn from the program and is proceeding toward loan closing and construction in a timely fashion. In Testimony Whereof, I have hereunto set my hand and affixed the seal of the County of Oakland, Pontiac, Michigan this 23rd day of and County Clerk RESOLUTION #87180 July 23, 1987 Moved by Richard Kuhn supported by Susan Kuhn the resolution be adopted. Moved by Price supported by Rowland the resolution be amended by inserting a new paragraph before the NOW THEREFORE BE IT RESOLVED paragraph that reads: "WHEREAS Royal Oak Township is in great need of Capital Assistance to improve its business districts; and WHEREAS sufficient funds are needed to impact this area." Also, in the paragraph following NOW THEREFORE BE IT RESOLVED, add "BE IT FURTHER RESOLVED that within the constraints of the criteria and procedure contained herein, funds up to 50% of the total allocation be made available to Royal Oak Township consistent with the purpose contained herein." Discussion followed. Vote on amendment: AYE: Angus McPherson, Perinoff, Pernick, Price, Rowland, Aaron, Doyon. (7) NAYS: Susan Kuhn, Lanni, Law, McConnell, McDonald, Ruel McPherson, Moffitt, Nelson, Page, Rewold,Skarritt, Wilcox, Caddell, Calandro, Gosling, Jensen, Richard Kuhn. (17) A sufficient majority not having voted therefor, the amendment failed. Vote on resolution: AYES: Lanni, Law, McConnell, McDonald, Angus McPherson, Ruel McPherson, Moffitt, Nelson, Page, Perinoff, Pernick, Price, Rewold, Rowland, Skarritt, Wilcox, Aaron, Caddell, Calandro, Doyon, Gosling, Jensen, Richard Kuhn, Susan Kuhn (24) NAYS: None. (0) A sufficient majority having voted therefor, the resolution was adopted. STATE OF MICHIGAN) COUNTY OF OAKLAND I, Lynn D. Allen, Oakland County Clerk/Register of Deeds, 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 July 23 . . . 1987 with the original record now remaining in my office.