Agenda 10/27/2009 Item #16D15Agenda Item No. 16D15
October 27, 2009
Page 1 of 4
EXECUTIVE SUMMARY
Present to the Board of County Commissioners changes to grant funded, owner - occupied
affordable housing programs administered by the Housing and Human Services
Department. These changes will modify program documents, expand eligibility criteria and
amend program procedures.
OBJECTIVE: Present to the Board of County Commissioners changes to grant funded, owner -
occupied affordable housing programs administered by the Housing and Human Services
Department. These changes will modify program documents, expand eligibility criteria and
amend program procedures.
CONSIDERATIONS: On October 13, 2009, under Public Comments on General Topics, the
Board of County Commissioners discussed concerns with the current practices and procedures of
a State Housing Initiatives Partnership Program (SHIP) and Disaster Recovery Initiative (DRI)
grant funded, owner- occupied affordable housing program. Specifically, the Board of County
Commissioners expressed concern about the security instrument and promissory note, the
potential for undisclosed liabilities, and criteria used to determine program eligibility. Following
discussion, the Board of County Commissioners directed the County Manager to develop more
stringent program guidelines. The items listed below will be implemented to alleviate the
concerns of the Board of County Commissioners.
Modify Program Documents
In order to protect the County's financial interests, persons receiving housing related grant
assistance are required to execute a security instrument and promissory note as a condition of
award. In some instances, a lien agreement is used in place of the aforementioned documents.
Housing and Human Services' review of program documents has identified areas for potential
improvement. For example, requirements contained in the security instrument require the
assisted property be occupied as a primary residence for at least one (1) year. However, the
terms of the grant assistance require the property be occupied as a primary residence so long as
the deferred payment loan is outstanding. Housing and Human Services will work in
conjunction with the County Attorney's Office in preparing standard program documents that are
consistent and accomplish the goals and objectives of the owner- occupied affordable housing
programs. These documents may include a security instrument, promissory note, lien agreement
and application for assistance. The County Attorney's Office will be asked to review and
approve the resulting documents for form and legal sufficiency.
Expand Eligibility Criteria
When operating state and federal affordable housing grants, Collier County enforces the rules
and regulations contained in the governing Florida Statutes, U.S. Code and Code of Federal
Regulations. The regulations are comprehensive and contain, in part, items relating to income
eligibility, residency requirements and allowable uses and activities. However, the regulations
are silent on consumer credit requirements and lien position; decisions on items such as these are
deferred to the local government to provide maximum flexibility in administering the state and
federal grants.
Agenda Item No. 16D15
October 27, 2009
Page 2 of 4
To strengthen the Board's confidence in the affected programs, Housing and Human Services
will expand the eligibility criteria to include a review of the applicants' consumer credit history.
Staff will not require a minimum credit score to participate in the program. However, a borrower
will not be eligible for assistance when, during the previous three (3) years:
• his/her previous principal residence or other real property was foreclosed; or
• he /she has given a deed -in -lieu of foreclosure; or
• he /she has filed Chapter 7 bankruptcy (liquidation); or
• he /she has filed Chapter 13 bankruptcy; or
• he /she is presently delinquent on a federal tax liability; or
• he /she is presently delinquent on Collier County property taxes
The above requirements were developed, in part, to conform to the consumer credit requirements
of the U.S. Department of Housing and Urban Development's Federal Housing Administration
(FHA) program, as detailed in HUD Handbook 4155.1.
An applicant seeking assistance to correct, mitigate or avoid a threat to health, safety or welfare
may be exempt from the above provisions and, therefore, awarded housing related grant funds.
Approval of any exception to the above provisions must be made by the Director of Housing and
Human Services with appropriate documentation.
Amend Program Procedures
The state and federal grants administered by Housing and Human Services do not impose any
consumer credit requirements. As such, ordering a consumer credit report has not been a
program procedure undertaken by staff when determining applicant eligibility. In order to
conform with the above expanded eligibility criteria, staff will begin ordering consumer credit
reports for all applicants seeking affordable housing grant assistance. In order to maintain the
cost effectiveness of the programs, staff may chose to only request a report from one reporting
agency (rather than all three). Some prospective applicants may not have an established credit
history. For these applicants, including those who do not use traditional credit, staff will obtain a
non - traditional credit report from a credit reporting company or develop a credit history from one
of the following sources:
• utility payment records; or
• rental payments; or
• automobile insurance payments; or
• other means of direct access from the credit provider
Evidence of credit eligibility, as described above, will be documented and made a part of the
applicants' permanent file.
FISCAL IMPACT: A consumer credit report costs an estimated $10.00 per applicant. With an
estimated 250 clients receiving state or federal owner - occupied housing related grant funded
assistance per fiscal year, these new program procedures will increase the cost of operating the
programs by at least $2,500.00 annually. While the costs of operating the programs will
increase, it will have no impact on the general fund.
Agenda Item No. 16D15
October 27, 2009
Page 3 of 4
GROWTH MANAGEMENT IMPACT: None.
LEGAL CONSIDERATIONS: This item has been reviewed and approved by the County
Attorney's Office. Housing and Human Services will send a Request for Legal Services and
provide the County Attorney's Office with all relevant documents for review. This item
is legally sufficient for Board approval. — CMG
STAFF RECOMMENDATION: Present to the Board of County Commissioners changes to
grant funded, owner - occupied affordable housing programs administered by the Housing and
Human Services Department. These changes will modify program documents, expand eligibility
criteria and amend program procedures.
PREPARED BY: Frank Ramsey, Housing Manager, Housing and Human Services
Page l of 1
Agenda Item No. 16015
October 27, 2009
Page 4 of 4
COLLIER COUNTY
BOARD OF COUNTY COMMISSIONERS
Item Number: 16D15
Item Summary: Present to the Board of County Commissioners changes to grant funded, owner- occupied
affordable housing programs administered by the Housing and Human Services Department.
These changes will modify program documents, expand eligibility criteria and amend
program procedures.
Meeting Date: 10127/2009 9:00:00 AM
Prepared By
Frank Ramsey
SHIP Program Coordinator
Date
Public Services
Housing and Human Services
10/16/2009 12:38:33 PM
Approved By
Kathy Carpenter
Executive Secretary
Date
Public Services
Public Services Admin.
1011612009 1:19 PM
Approved By
Marcy Krumbine
Director
Date
Public Services
Housing & Human Services
10/16/2009 3:50 PM
Approved By
Colleen Greene
Assistant County Attorner
Date
County Attorney
County Attorney Office
10/1912009 3:00 PM
Approved By
Jeff Klatzkow
County Attorney
Date
County Attorney
County Attorney Office
10/20/2009 8:45 AM
Approved By
Marla Ramsey
Public Services Administrator
Date
Public Services
Public Services Admin.
10/20/2009 10:52 AM
Approved By
Sherry Pryor
Management & Budget Analyst
Date
County Manager's Office
Office of Management & Budget
1012012009 12:51 PM
Approved By
John A. Yonkosky
Director of the Office of Management
Date
County Manager's Office
Office of Management & Budget
1012012009 12:57 PM
file: / /C: \AgendaTest \Export\137 - October 27,2009\16. CONSENT AGENDA \16D. PUBLI... 10/21/2009