06&07 Housing Infrastructure Grant State Funding Program

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CITY OF PARIS, TEXAS CITY COUNCIL AGENDA REQUEST MEETING DATE: February 11, 2008 ❑ Action ❑ Discussion ■ Information ❑ Refer to: SUBMITTED BY: Lisa A. Wright, Director of Community Development DESCRIPTION: Advise City Council of status of the Housing Infrastructure Fund (HIF) Grant. The City of Paris is in receipt of a letter from the Office of Rural and Com he altmountlof (ORCA) advising of the potential required repayment of he nat onal housing objective $393, 520.00 for failure by the City s contraand UrbaneDevelopment. established by the Department of Housing BACKGROUND INFORMATION: In 1999, the City of Paris was awarded an HIF grant in the amount of ~veme00.00the ORCA. The grant was to fund water, sewer, street, and drainage impro Eastgate Subdivision. As a condition of the grant, the City was ere to be ownedtand thirty-eight (38) new single-family homes, of which at least 60 /o w occupied by low to moderate income persons. That number was later I estab shed1b~ after cities nationwide were having trouble meeting the national goa Y HUD. On December 9, 1999, the City awarded a contract to Housing Associates, Inc. of Allgeier) to develop the subdivision and sell the houses in acco d s ble forh mheet ng the the grant. The contract with the developer made him resp lowlmod occupancy requirements. The City entered into a separate agreer elin ibil th and Enterprises for consulting services to review paperwork to confirm buy g Y to submit all required reports to ORCA. Although a few homes were built rather quickly, none of the owners q ~a~rf ~er~ and mohe grant (a tour of the subdivision will show that the first homes were g ex ensive than homes built later). It was not until 2002 that the first homaima esui~n~ p q 9 a qualified home buyer. In 2004, the developer sold ten lo idualsa Althou h the City was that he sell at least 50% of those homes to qualifying ind 9 not initially aware of the sale, when we later learned the terms of the saect oauand Mre. builder to sell at least half of the homes to qualified buyers, we had no ob~ , Swaim did fulfill the terms of this agreement with the developer. In 2005, after only nine houses had been sold to qualified buyers of thain 9he Cit ewas be sold, the developer sold an additional 10 lots to Hayd~en When ogtacted to obtain not aware of this transaction until well after it occurre closing paperwork (after numerous failed attempts to contact Mr. Allg~ firsthmean~n r advised us that the second transaction did not include terms similar , 9 there was no requirement that any of the homes be sold to qualifying inWia dnotS o n to this second sa le o f lo ts by t h e d e v e l o p e r t h a t v i r t u a l l y e n s u r~ ~ te ~~it learned of ghe meet t he terms o f i t s g r a n t a g r e e m e n t w i t h O R C Ano o t ortunities for the City to recti fy sale, the subdivision was built-out and there were pp the matter by attempting to obtain vacant lots or enter into some kind of agreement with Mr. Swaim. _ _ _ _ , . ~