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06-E BTW Community Ctr FundsDRAFT J:\Attorney\LISA\Resolutions\CiJRRENT\Razzmatazz Grant App.wpd December 5, 2001 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PARIS, PARIS, TEXAS, AUTHORIZING THE EXECUTION OF AN APPLICATION FORA SPECIAL COMMUNITY DEVELOPMENT BLOCK GRANT FROM THE U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD); ACCEPTING SAID GRANT AWARD UPON NOTICE THEREOF; AUTHORIZING THE EXECUTION OF ANY AND ALL DOCUMENTS NECESSARY FOR ACCEPTANCE AND IMPLEMENTATION OF SAID GRANT UPON NOTICE THEREOF; AUTHORIZING THE CITY TO WITHDRAW FROM THE PROJECT IN THE EVENT GRANT FUNDS MADE AVAILABLE DO NOT COVERALL EXPENSES; MAKING OTHER FINDINGS AND PROVISIONS RELATED TO THE SUBJECT; AND DECLARING AN EFFECTIVE DATE. WHEREAS, the Department of Housing and Urban Development (HUD) has requested assistance from the City of Paris in meeting HUD's obligations under the Young v. Martinez lawsuit, and in particular, HUD has requested the City of Paris apply for grant funding to purchase and demolish the Razzmatazz Club and construct a new community center for the Booker T. Washington Homes; and, WHEREAS, HUD has informed the City that $200,000.00 in grant funds would be made available by HUD for said project, and that HUD would also provide $38,000.00 in funds to the Housing Authority of the City of Paris as the Authority's matching cash contribution to the proj ect; and, WHEREAS, the City has expressed its concern to HUD that the amount of funding provided may not be sufficient to purchase the property in the event eminent domain proceedings are required to complete the proj ect, and HUD has assured the City that the City may withdraw or rescind eminent domain proceedings if the award to the property owner is excessive and will result in a lack of funds to complete the proj ect; and, WHEREAS, HUD has further assured the City that HUD will, in accordance with 49 CFR 24.107 and Texas Property Code, Section 21.019, allow reasonable expenses incurred by the City and the owner of the property in the eminent domain proceedings to be paid from the grant funds, even if such proceedings are not completed, thereby resulting in no cost to the City; and, WHEREAS, acceptance of said grant shall be further conditioned upon formal agreement by the Board of Commissioners of the Housing Authority of the City of Paris on behalf of said Authority to forever be responsible for the repair, maintenance, and upkeep of said facility without contribution from the City of Paris; and, WHEREAS, based on these conditions and assurances provided by the Department of Housing and Urban Development (HUD) and to be provided by the Housing Authority of the City of Paris, the City Council of the City of Paris is desirous of processing a grant application for the "Booker T. Washington Community Center Project," at atotal cost of $238,000.00, with $200,000.00 to be provided by grant and $38,000.00 to be provided by the Housing Authority of the City of Paris in the form of matching funds, with the City of Paris providing no matching contributions; and, WHEREAS, the City Council desires to authorize the Mayor, City Manager, and appropriate City staff to accept and implement said grant (if same is received) without further action of City Council; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PARIS, PARIS, TEXAS: Section 1. That the findings set out in the preamble to this resolution are hereby in all things approved. Section 2. That an application be made to the Texas Department of Housing and Community Affairs for a Community Development Block Grant in the amount of $200,000.00 for the "Booker T. Washington Homes Community Center Proj ect," with the Housing Authority of the City of Paris providing $38,000.00 in matching funds and the City of Paris providing no matching contributions. Section 3. That the application described in Section 2 hereof shall be contingent upon the assurances by the Department of Housing and Urban Development that the City of Paris may withdraw from the proj ect in the event the funds provided by the grant and the matching contribution from the Housing Authority are not sufficient to cover the entire cost of the proj ect, including the cost of eminent domain, if any, and that any costs incurred in eminent domain proceedings, if necessary, will be paid from the proceeds of the grant, even if the property is not acquired. Section 4. That acceptance of said grant shall be and is hereby conditioned upon formal agreement by the Board of Commissioners of the Housing Authority of the City of Paris on behalf of said Authority to forever be responsible for the repair, maintenance, and upkeep of said facility without contribution by the City of Paris. Section 5. That the City Manager be, and he is hereby, appointed as the Authorized Official of said proj ect and is authorized and directed to execute, on behalf of the City of Paris, the application for grant under the terms and conditions and in the form approved by the City Attorney. Section 6. That the Proj ect Director, Thomas E. Haynes, be, and he is hereby, appointed as Project Director and is hereby authorized to execute and deliver, on behalf of the City of Paris, all reports, communications, assurances, and documents necessary for the completion of said proj ect. Section 7. That the Director of Finance be, and he is hereby, authorized and directed to serve as the Financial Officer for said project and to receive and distribute funds for purposes of the "Booker T. Washington Homes Community Center Project." Section 8. That the Mayor, City Manager, Project Director, and Finance Director be authorized and directed to execute, on behalf of the City of Paris, any and all documents necessary for acceptance and implementation of said grant upon notice of award thereof by the Texas Department of Housing and Community Affairs, under the terms and conditions as set out herein and in the forms approved by the City Attorney, and to proceed with use of said funds upon receipt thereof for the purposes stated herein and in accordance with the grant conditions. Section 9. That this resolution shall be effective from and after its date of passage. PASSED AND APPROVED this l Oth day of December, 2001. Michael J. Pfiester, Mayor ATTEST: Mattie Cunningham, City Clerk APPROVED AS TO FORM: Larry W. Schenk, City Attorney Lisa Wright From: Larry W Schenk Sent: Wednesday, November 07, 2001 5:44 PM To: Alice Pinalto; Lisa Wright Subject: FW: Paris Property Acqusition Question >From: Michael E Malone >Sent: Wednesday, November 07, 2001 5:43:59 PM >To: Larry W Schenk; Alice Pinalto >Subject: FW: Paris Property Acqusition Question >Auto forwarded by a Rule > -----Original Message----- From: J._Arturo Zavala@HUD.GOV [mailto:J._Arturo_Zavala@HUD.GOV] Sent: Tuesday, November 06, 2001 1:40 PM To: memalone@1starnet.com; thaynes@1starnet.com Subject: Paris Property Acqusition Question This will follow-up on our meeting last Tuesday, October 30, 2001. For your information, I am forwarding the e-mail I sent to John Davis, our Real Estate/Relocation Officer whose expertise is the Uniform Act. I posed the question we discussed regarding the city's option to withdraw from the project if acquisition costs become prohibitive. Mr. Davis has provided me his response which I am forwarding to you separately. Thanks. Art Zavala Forwarded by J. Arturo Zavala/CPD/FTW/HUD on 11/06/01 11:20 AM J. Arturo Zavala To: John F. Davis/CPD/FTW/HUD@HUD 11/02/01 cc: (bcc: J. Arturo 11:05 AM Zavala/CPD/FTW/HUD) Subject: Paris Property Acqusition Question John: This is a follow-up question to our discussion earlier this week regarding a property acquisition issue (Razzmatazz Club) in Paris, Texas. The property in question, as you know, is located adjacent to an existing PHA site. Following our meeting, I traveled to Paris to discuss this project with city and PHA officials. One of the issues we discussed was the overall budget of $200,000 which may or may not be sufficient for acquisition, demolition, and new construction. This depends on the cost to acquire which city officials fear could be very high. Anyway, the city is concerned that if acquisition eventually ends up through the eminent domain process, and the court determines that the value of the property is such that it exceeds the grant funds available, could the city opt to not follow through with the acquisition and drop the project? Once the city is engaged in the condemnation proceedings, does this mean that the city is locked in to acquire at whatever cost the court determines? If you could provide some guidance on these questions, I will respond to the city. City officials appear very willing to move on this project but because they have no idea what the value of the property is, officials want to be aware of their options if the project cannot be done totally with CDBG funds. The city will not make local funds available for this project. Thanks. Art Zavala Lisa Wright From: Larry W Schenk Sent: Wednesday, November 07, 2001 5:44 PM To: Alice Pinalto; Lisa Wright Subject: FW: Response to Property Acquisition Question >From: Michael E Malone >Sent: Wednesday, November 07, 2001 5:43:34 PM >To: Larry W Schenk; Alice Pinalto >Subject: FW: Response to Property Acquisition Question >Auto forwarded by a Rule > -----Original Message----- From: J._Arturo Zavala@HUD.GOV [mailto:J._Arturo_Zavala@HUD.GOV] Sent: Tuesday, November 06, 2001 1:42 PM To: memalone@1starnet.com; thaynes@1starnet.com Subject: Response to Property Acquisition Question Here is John Davis' response to the question we discussed at our meeting last week.You should note that Mr. Davis raises another question in the last paragraph of his message, which I have discussed with the State of Texas. If the city were to withdraw from the project because it did not become feasible, the state would terminate the contract but would allow reasonable expenses incurred by the owner to be paid with the CDBG grant. Because of the extenuating circumstances in connection with the East Texas law suit, HUD would not disallow the costs. This would be considered a valid attempt to remedy a neighborhood equalization issue. Thanks. Art Zavala Forwarded by J. Arturo Zavala/CPD/FTW/HUD on 11/06/01 11:36 AM John F. Davis To: J. Arturo 11/02/0112:35 Zavala/CPD/FTW/HUD@HUD PM cc: Subject: Re: Paris Property Acquisition Question(Document link: J. Arturo Zavala) Art, The Uniform Act regulations at 49 CFR Party 24 and the Texas Property Code establish the actions that must occur if a State agency withdraws or seeks dismissal of an eminent domain action. The Uniform Act regulations at 49 CFR Section 24.107, which would apply to any acquisition action under Federal funding or assistance, as in the instant case, requires the owner of real property to be reimbursed for "any reasonable expenses, including reasonable attorney, appraisal, and engineering fees, which the owner actually incurred because of a condemnation proceeding, if: (a). . (b) The condemnation proceeding is abandoned by the Agency other than under an agreed-upon settlement;...." The Texas Property Code contains somewhat similar requirements at Section 21.019, "Dismissal of Condemnation Proceedings." This section states that, (1) a party that files a condemnation petition may move to dismiss the proceedings, and the court shall conduct a hearing on the motion; and (2) a court that hears and grants a condemnation dismissal motion under this section of the Code "shall make allowance to the property owner for reasonable and necessary fees for attorneys, appraisers, and photographers and for the other expenses incurred by the property owner to the date of the hearing." Thus, the Uniform Act regulations require an acquiring agency to reimburse a property owner for the described reasonable expenses if the owner actually incurred them, and the Texas Property Code requires the court hearing a dismissal motion to "make allowance" for such similar expenses. I am sure that "make allowance" means that the court would dismiss the condemnation suit and it would require the acquiring agency to pay the expenses outlined. In answer to your question, therefore, the cited regulations and code allow for withdrawals from eminent domain taking actions, but require the acquiring agency to pay certain expenses the property owner incurred in defending the action. An additional interesting question would be: If the City withdrew from its effort to take the property because the Court's award was too high, where would the money come from to pay the required expenses? John Davis 11 /2/2001 12:42 PM CST TX PROPERTY § 21.019 V.T.C.A., Property Code § 21.019 VERNON'S TEXAS STATU'PES AND CODES ANNOTATED TITLE 4. ACTIONS AND REMEDIES CHAPTER 21. EMINENT DOMAIN SUBCHAPTER B. PROCEDURE Copr. O Wes[ Group 2001. All rights reserved. Current through End of 1999 Reg. Sess. & 21.019. Dismissal of Condemnation Proceedines Page 2 (a) A party [ha[ files a condemnation pe[ition may move to dismiss [he proceedings, and the court shall conduct a hearing on the motion. However, after the special commissioners have made an award, in an effort to obtain a lower award a condemnor may not dismiss the condemnation proceedings merely to institute new proceedings that involve substantially the same condemnation against the same property owner. (b) A court that hears and grants a motion [o dismiss a condemna[ion proceeding made by a condemnor under Subsection (a) shall make an allowance to the property owner for reasonable and necessary fees For attomeys, appraisers, and pho[ographers and for the other expenses incurre<l by the property owner to the date of the hearing. (c) A court that hears and grants a motion ro dismiss a condemnation proceeding made by a property owner seeking a judicial denial of the right to condemn or that otherwise renders a judgment denying the right to condemn may make an allowance to the property ownet for reasonable and necessary fees for attomeys, appraisers, and photographers and for the other expenses incurred by the property owner to [he date of the hearing or judgmen[. CREDIT(S) 1984 Main Volume Acts 1983, 68th Leg., p. 3501, ch. 576, § 1, eff. Jan. 1, 1984. 2001 Electronic Update Amended by Acts 1987, 70th I.eg., ch. 483, § 1, ef£ Aug. 31, 1987. ¢General Materials (GN) - References, Mnotaflons, or Tables> HISTORICAL AND STATUTORY NOTES 2001 Electronic Update 1987 Legislation The 1987 amendment in subsea (b) inserted "and granu" and "made by a condemnor under Subsection (a); and added subsec. (c). Copr. (D West 2001 No Claim to Orig. U.S. GovL Works §24.106 the tenant-ownefs dght, ti[le, and in- terest in the improvement; and (2) The owner of the real property on which the improvement is located dis- claims all interest In the improvement; and (3) The payment does not result Sn the duplication oF any compensation otherwise authorized by law. (e) A[ternatlve campensatlan. Nothing in [hts subpar[ shall be consirued to deprive the cenant-owner of any dght to reJect payment under this subpart and to obtain payment for such prop- erty Interestsin accordance with other applicable law. [54 FR 8928, Mar. 2, 1989; 54 FR 24712, June 9, 1989, as amended at 64 FR 7132, Feb. 12, 19%] §24.106 Ezpenaee incidental to trane- fer o[ titie to the Agency. (a) The owner of the real property shall be reimbursed for all reasonable expenses the owner necessarlly in- curred far: (l) Recording fees, transfer taxes, documentary stamps, evidence of title, boundary surveys, legal descriptions of the real property, and similar expenses inciden[al [o conveying the real prop- crty [o the Agency. However. the Agen- cy is no[ required to pay costs solely requlred to perfect the owner's title to the real property; and (2) Penalty costs and other chazges for prepayment of any preexisting re- corded mortgage entered into in good faith encumbering the real property; and (3) The pro rata portion of any pre- paid real property taxes which are allo- cable to the perlod after the Agency obtains title to the property or effec- tive possesslon of St, whichever is ear- lier. (b) 4Vhenever feazible, the Agency shall pay these costs directly so that the owner will not have to pay such costs and then seek relmbursement from [he Agency. 424.107 Certaia litigation erzpenaee. The owner of the real property shall be reimbursed for any reasonab(e ex- penses, induding reasonable altorney, appralsal, and engineering fees, which the owner actually incurred because of a condemna2ion proceeding, 1f: 49 CFR SubtRle A(10-1-00 Editton) (a) The finaljudgment of the court is that the Agency cannot acquire the real property by condemnation; or (b) The condemnation proceeding is abandoned by the Agency other [han under an agreed-upon settlement; or (c) The court having furisdlction ren- ders a Judgment in favor of the owner In an lnverse condemnatlon proceeding or the Agency effects a settlement of such proceeding. §24.308 Donatione. An owner whose real property is being acquired may, after being fully informed by the Agency of the right to recelve Just compensation for such property, donate such property or any part thereof, any interest therein, or any compensaHon paid therefor, to the Agency as such owner shall determine. The Agency is responsible for assuring that an appraisal of the real property is obtafned unless the owner releases the Agency from such obligation, ex- cept as provided In 524.302(c)(2). Subpart C--General Relocation Requirements §24.201 Purpoee. This subpart prescribes general re- quirements governing the provision of relocaHOn paymen[s and other reloca- tion ass{stance 1n this part. ¢24.202 Applicability. These requtrements apply to the relo- cation of any displaced person as de- ftned at § 24.2. [54 FR 8928, Mar. Z, 1989, as amelMed at 64 FR 7132, Fe6. 12, 1999] $24.203 Ralceationnoticee. (a) Ceneral informatlon notice. As soon as £easlble, a person scheduled to be displaced shall be furnlshed with a gen- eral wdtten descdptlon of the dis- placing agency's relocatfon program which does at least the following: (I) Informs [he person that he or she may be displaced for the project and generally describes the relocatlon pay- ment(s) for which the person may be el- igible, the basic conditions of eligl- billty, and the procedures for obtaining the payment(s). 220 HOUSING AUTHORITY OF'l,HE CI'1'Y OF PARIS POST OPF'ICE BOX 688 PARIS, TEXAS 75461 903 784 - 6651 Septenilber 14, 2001 N1ike iVtaloue City11auiager CitV Of Paris, "l'exas Dear. 'Mr. Maloue: It is our understanding that the Young vs. Vlartinez Pund money has been sct aside b~tlle State for the possi6le purchase of tlie Rarz NIa 1'azz club site. X1'e are conhdene Lhe City of Paris will mal:e a successful applica[ion For lliese t'unds. Thc Housinh Authority of the City of Paris otl'ers our wholehearted support for tiiis un<lerLal:ing. Por iuany ycars this establishment has created a concern for the sat'ety ancl wc;ll-beiu;; of our residents at Booker '1'. Washington Homes. Many resi(lents have conLacted the :luthority roicing eheir concertts and fears. l:specially those who reside directly across the sh-cet lrom the club. Activities at the Razr vIa "1'azz club soinetimes last until carl}moniing, hours. Maiiy of the patruns are in the parl:ing lot, sidewall:s, and c\en thc Cront yaucis ot'our residents. "1'hese activities continue long after dle club is closal. "l,he Housing Authoriry and the residents of 13ooker "1'. Washington offer the city their support and any assistance necessary to eliminate this public nuisance, and potentially dail;;erous environment for public housiiig. RECEiVED llenny 1Z.Head SEP 17 2001 C[TY MANACER PARiF. -rexAS