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2009-05-26
PLEASE TURN OFF CELL PHONES & PAGERS IN COUNCIL CHAMBERS. AGENDA ~~ I~ C~~~~ MOUND I=iOUSING & REDEVELOPMENT AUTHORITY REGULAR MEETING '~~JESDAY, MAY 26, 2009, 6:30 P.M. MOUND CITY COUNCIL CHAMBERS Pale 1. Open meeting 2. Action approving agenda, with any amendments. 3. Action approving minutes for May 12, 2009 regular meeting 1 •4. Action approving claims 2_4 5. Review/discussion -Indian Knoll Manor public housing facility 5-30 management/operations 6. Adjourn MOUND HOUSING AND REDEVELOPMENT AUTHORITY • MAY 12, 2009 The Housing and Redevelopment Authority in and for the City of Mound, Minnesota, met in regular session on Tuesday, May 12, 2009, at 7:25 p.m. in the council chambers of city hall Members present: Acting Chair David Osmek, Commissioners Ray Salazar, Heidi Gesch and Greg Skinner Members absent: Chair Mark Hanus Others present: City Attorney John Dean, Executive Director Kandis Hanson, City Clerk Bonnie Ritter, Community Development Director Sarah Smith 1. Open meeting Acting Chair Osmek called the meeting to order at 7:25 p.m. 2. Approve agenda It was requested that Item #5, Review/discussion on Indian Knoll Manor be removed from the agenda. MOTION by Gesch, seconded by Salazar to approve the agenda as amended. All voted in favor. Motion carried. • 3. Approve minutes MOTION by Salazar, seconded by Gesch to approve the minutes of the April 28, 2009 regular meeting. All voted in favor. Motion carried. 4. Approve claims MOTION by Gesch, seconded by Salazar to approve claims in the amount of $6,358.37. All voted in favor. Motion carried. 5. Review/discussion -Indian Knoll Manor management/operations (removed) 6. Adjourn MOTION by Gesch, seconded by Salazar to adjourn at 7:26 p.m. All voted in favor. Motion carried. Acting Chair David Osmek Attest: Bonnie Ritter, City Clerk -1- MAY 26, 2009 H.R.A. CLAIMS REPORT ~ 052609HRA $12,144.15 MAY ~ TOTAL $12,144.15 -2- City of Mound 05/20!09 10:06 AM Page 1 ', Payments • CITY OF MOUND Current Period: May 2009 Batch Name 052609HRA Userpolla rAmt $12,144.15 Payments Computerpolla rAmt $12,144.15 $0.00 In Balance Refer 52609 ADAMS PEST CONTROL, INCORP Cash Payment E 680-49800-440 Other Contractual Servic 05-07-09 SERVICE 5 UNITS $59.68 Invoice 505625 5/26/2009 Transaction Date 5/19/2009 . ~_, .. _ . __. ~, , T~.~ .~ ~ ~ _ . . Wells Fargo HRA 10120 . . Total $59.68 _ . . .. . ~ Refer 52609 CULLIGAN -METRO _ .~.. r~ . ~ e,. ., -,._ ~. Cash Payment E 680-49800-401 Building Repairs 04-27-09 SERVICE CALL $752.50 Invoice 101X20794809 5/26/2009 Transaction Date 5/19/2009 ~ Wells Fargo HRA 10120 ~ ~ ~~ ~ Total $752.50 Refer 52609 DALBEC ROOFING MAINTENANCE _~ ~ ~ ~ ~ ~~ ~ _ ~ ~ ~ Cash Payment E 680-49800-401 Building Repairs ROOF REPAIR $2,800.00 Invoice 44650 5/26/2009 PO 21601 Transaction Date 5/20/2009 ~.,.., _.r.., ~ ~ _ _ _. .. Wells Fargo HRA 10120 .., ... _ x Total $2,800.00 Refer 52609 HOME VALU INTERIORS _ , , ,< Cash Payment E 680-49800-402 Building Maintenance #108 TILE IN KITCHEN AND BATH $1,170.48 Invoice 11046063 5/26/2009 PO 21475 Cash Payment E 680-49800-402 Building Maintenance #108 RETURN MERCHANDISE -$100.00 • Invoice 11901876 5/26/2009 PO 21475 Cash Payment E 680-49800-402 Buiiding Maintenance #304 VINYL BASE $70.00 Invoice 11046377 5/26/2009 PO 21475 Cash Payment E 680-49800-402 Building Maintenance #206 TILE & CARPET KITCHEN AND BATH $1,611.98 Invoice 11046064 5/26/2009 PO 21475 Transaction Date 5/18/2009 Wells Fargo HRA 10120 " " Total $2,752.46 Refer 52609 MOUND, CITY OF °°'~" ~ ~~ ~a~=__ ` `"'~~" ~ "~ , ._ , Cash Payment E 680-49800-382 Water Utilities 04-09 WATER/SEWER $1,520.62 Invoice 052609 5/26/2009 Transaction Date 5/19/2009 Wells Fargo HRA 10120 Total $1,520.62 Refer 52609 STA-SAFE LOCKSMITHS COMPAN Cash Payment E 680-49800-402 Building Maintenance REKEY ROOMS $4,258.89 Invoice 16060 5!26/2009 PO 21672 Transaction Date 5/20/2009 Wells Fargo HRA 10120 Total $4,258.89 -3- City of Mound 05/20/09 10:06 AM I, Page 2 Payments CITY OF MOUND Fund Summary 680 HRA PUBLIC HOUSING Current Period: May 2008 10120 Wells Fargo HRA $12,144.15 $12,144.15 Pre-Written Check $0.00 Checks to be Generated by the Compute $12,144.15 Total $12,144.15 -4- s 5341 Maywood Road • Mound, MN 55364 (952) 472-0604 MEMORANDUM To: Mound HRA Board Chair and Commissioners From: Sarah Smith, Community Development Director /Finance Director Catherine Pausche / Carlton Moore, Public Works Director Dam: May 7, 2009 (Revised May 20, 2009) Re: Indian Knoll Public Housing Operations and Management Research Project Report HRA Workshop Meeting. The HRA will meet in a workshop meeting session on Tuesday, May 26, 2009 at 6:30 PM to discuss the Indian Knoll Manor public housing facility. Background. As requested by the HRA, an interdepartmental review of the Indian Knoll public housing complex was undertaken with regard to present and future • operations, management and ownership. Provided below is a summary and overview of the current operations including activities which have been done and/or are presently underway as well as a summary of the research which has been completed. Operations and Management Overview. • Indian Knoll is a public housing facility owned by the Mound HRA (commonly referred to as a Public Housing Authority, or "PHA" in HUD documents) for eligible, age-restricted individuals (seniors 62+) and handicapped or disabled persons. • From 2001 through January 2009, management services at Indian Knoll were contracted out. For many years prior to that, management of Indian Knoll was done in-house by the HRA. • Mound Staff assumed overall management of Indian Knoll effective February 2009. Staffing is being cooperatively provided to Indian Knoll by several departments including Administration (Executive Director), Finance Department (staffing office 9:OOam -11:OOam weekdays, bookkeeping and management), Parks Department (Grounds) and the Public Works Department (Maintenance). Indian Knoll is billed a $2,500 monthly management fee, and time and materials for the Housing Coordinator and maintenance services (all • credited to the General Fund). -5- • Indian Knoll is Mound's only approved "Crime Free Housing" facility. • There are 50 units at Indian Knoll (15 studios, (34)1-bedrooms, and (1) 2- bedroom caretaker unit). At present, (46) are occupied. Units are approximately 375-400 square feet in size. HUD's maximum size for affordable housing is 540 square feet. • An analysis of the mechanical systems was recently undertaken by MnSpect; a copy of the report was received earlier this week and is currently under review by Staff. • Enhanced marketing and advertising efforts for Indian Knoll are underway to promote the facility. As of February 1, 2009, there were six vacancies. We have moved 5 tenants in and 3 vacated since that time. There has been a positive response to the advertisement in the City Newsletter. Historical vacancy rates averaged 2 units, and we expect to be full by July 1St, with vacancy rates stabilizing after that time. • Several of the units were updated (i.e. new flooring, carpeting, painting, etc.) in preparation of the February HUD REAC inspection as well as to get them ready to lease. All locks were rekeyed to simplify and increase security. • Staff is cunrently evaluating its admissions, lease and management policies including the need for updating and/or revisions. Research Summary. • Conducted HUD research re: disposition of public housing. Refer to attachment. • The HUD project number for Indian Knoll is MN074001; the date of the Annual Contribution Contract with HUD is 6/3/70. A copy of the Annual Contributions Contract was not found in City offices and was also not located at Hennepin County as part of a title search of the property. Therefore, a copy was requested from HUD. Refer to attachment. • Staff met with Ms. Cheri Pugh-Sullivan, who is a Mound resident, regarding her background and experience working in public housing. Ms. Pugh-Sullivan has been invited to attend the 5/26 work session with the HRA as a housing resource. • Staff contacted Ms. Lucy Beckwell who is a Public Housing Revitalization Specialist for HUD in the Minneapolis office: - Indian Knoll has a 40-year public housing contract under HUD regulations. • Page 2 -6- • -Any proposed occupancy change (example, senior only) requires approval of an amendment to the Designated Housing Plan by HUD. - HRA could pursue an "administrative amendment"to transfer the asset to another qualified and eligible agency /organization. Ms. Beckwell did not believe there was any issue if the accepting agency was located outside of the City or County limits. - Staff will further comment and provide details regarding the Designated Housing Plan and administrative amendment processes at the meeting. • Staff contacted Julie Frick, Carver County Community Development Authority Executive Director; Carver County CDA: - Carver County CDA assumed management and was also transferred ownership of the Spruce Apartments from the City of Waconia / HRA. - Carver County CDA manages over 500 units. - Ms. Frick commented on the importance of a good lease and well-written policies. Additionally, she further stressed the importance of a having an on-site caretaker, if possible. Ms. Frick has provided copies of their • can-ent lease and policy document(s) which will be provided to members of the HRA upon request. - Carver County CDA has utilized a joint powers agreement for similar related projects. - Ms. Frick has been invited to attend the 5/26 HRA workshop as a housing resource. • Staff met with representatives of CommonBond Communities on 5/5: - CommonBond currently manages and owns approximately 5,000 housing units in and around the Twin Cities metropolitan area including the Westonka Estates Apartments in Mound. - CommonBond undertook a $62M renovation of a number of their facilities in 2006 which included Westonka Estates. The per unit renovation cost was approximately $25K. • Page 3 -7- - CommonBond has never assumed a property from an HRA, but was told our project would have to be converted from public housing to Section 8 housing, therefore losing the tax advantages and federal capital subsidies provided by projects run by HRA/PHAs. Discussion. • The HRA may wish to discuss the occupancy use(s) of Indian Knoll as provided in the HUD agreement. • HUD has specific guidelines and processes related to the demolition and disposal of public housing including regulations how gross proceeds, if realized, are to be used. The ability for the HRA to realize any substantial profit (unrestricted) appears unlikely. • In addition to the 40-year clause referenced above, there are also further restrictions regarding disposition of Indian Knoll for an additional period(s) following acceptance of capital (20 years) or operations (10 years) funds from HUD by the HRA. • Members are advised that the most recent Capital Fund Program (CFP) Amendment to the Annual Contributions Contract was signed in March 2009 for a capital grant in the amount of $65,558. Copy aftached. • Several individuals Staff spoke with discussed that there is benefit of having public housing facilities managed and operated locally. • Based on research undertaken by Mound HRA Attorney John Dean, there is nothing in state statute which would prevent the HRA from disposing and/or selling the facility. There are, however, provisions and restrictions within the HRA's agreement(s) with HUD for Indian Knoll which affect what options may be available. Analysis Summary. Without intending to limit discussion, Staffs review has raised three (3) basic options for Indian Knoll which are identified as follows: 1. Discontinue public housing ownership and sell the land to a private party for some other use which would be subject to all required HUD regulations and approvals. 2. Disposition of the facility to a public entity or to a private organization to continue the public housing activity. 3. Continued operation by Mound HRA with or without any occupancy change. • Page 4 -$- Based on the research which has been completed, Staffls pos~ion is that • management, operations and ownership of Indian Knoll should continue to be done locally by the Mound HRA. Next Steps. Mound StafF will be present at the May 26, 2009 meeting to share the aforementioned information regarding Indian Knoll and looks forward to review and discussion with the HRA Board. In the event there are any questions, HRA Members are encouraged to contact Staff at their convenience. Please do so in advance of the meeting if you feel there is information that is lacking that would be pertinent to the discussion. • Page 5 -9- Demolition and Disposition -HUD Public and Indian Housing ^ About PIH ^ Special Applications Center ^ Demolition/ disposition ^ Designated housing ^ Eminent domain ^ Homeownership ^ Section 202 conversion ^ Conversion ^ Works in progress ^ About the SAC HUD news Homes Resources Communities Working with HUD Tools W ebcasts Mailing lists RSS Feeds Help ]If ~1~~> Demolition/Disposition Guidance The demolition and disposition of public housing is authorized under Section 18 of the Housing Act of 1937 (the Act), as amended. HUD has promulgated a regulation, 24 CFR X70, detailing the administrative steps required to perform demolition/disposition activity in accordance with the Act. A r ve ision to ~~R ~Z was published in the Federal Register on October 24, 2006, and took effect on November 24, 2006. A c~.rre 'Qn ~4 the revi~ 24 CF~70 was published in the Federal Register on January 23, 2008. This webpage reflects the revised processing criteria. Although demolition/disposition activity has always been permitted, HUD and its business partners have begun to actively pursue it as a management strategy option in the last ten years. This is due to the realization that some developments have difficulties associated not only with physical deterioration, but also with the overall deterioration of the surrounding community. It is also true that a large portion of the housing now being proposed for demolition/disposition was built in the late 1940s and early 1950s, and was built to a standard that is no longer acceptable for the general public. Developments meeting that description have very often become the housing of last resort within their communities. Potential Reasons for Demolition/Disposition Public Housing Agencies (PHAs) may decide to demolish or dispose of an entire development, or a portion of a development, for a variety of reasons, including: Demolition For the demolition of an entire development, the development is obsolete as to physical condition, location, or other factors, making it unsuitable for housing purposes, and no reasonable program of modifications is cost-effective to return the public housing project or portion of the project to Its useful life. Linfs[m~i2n-b~~.tets f~~~.si!I~srtl~sAaSQ!. Print version Jump to... - Guidance - Potential reasons for Qe tL1Qli i ./_d_tlER9_iStQ~. - DisoolLtiiuts.ln_IlaapAS:rt stf Haas.In.9.Aer~il.Qpsd~ur~.u.aat_.ta ~ CFR 941 (Sub°al#~ - Lease Dispositions - itgaident~Onsultation/offer of s~ia - Replacement Housing Plan fR-~Pl - Resident Relocation information - Prop~y Approved for Disposition at Below Fair Market v_~lste_=.E~t.~~4 U$s_gf..~rsttanr~x - Uas_gf_P_r_2soada. - }2anoolitianl~2isA~sltian kasdtnicaL 9ksietslnGe oaekaoe - Phased Dgr3yoiition Applications - Local approvals - l~pplicaiian review and.appray_el. - Fial.sLQfticaInput - ;ayb~sion reouitaments What's New Use of Proceeds: Explanations and Fregllentiy Asked Questions (MS-Word) Correction to 24 CFR 970 - On October 24, 2006, HUD published a final rule revising the agency's regulations on demolition or disposition of public housing projects under 24 CFR 970. The Federal Register document published on January 23, 2008 as FR-4598-C-03 corrects certain typographical and other non- substantive errors that occurred in the final rule. i?~moJitism~sacaa.Arsi.Qental LQr~. Applications went electronic on February 2, 2004, per Notice 2003-33. This notice has been revised and extended. $gfl (Adobe PDF, 5 pages) pemolition Disp so itioi Manual for PIC Demol ~iiiRl?.QitiSLf!_Qnd=u:~gi:$ For the demolition of a portion of a development, that portion of the development is obsolete as to physical condition, location, or other factors, making it unsuitable'for housing purposes, and no reasonable program of modifications is cost-effective to return that portion to its useful life, and the demolition will allow the remaining portions of the development to be the partial demolition will ensure the viability of the remaining portion of the development by reducing density to permit better access by emergency, fire, or rescue services, or improving the marketability by reducing density to that of the neighborhood or other developments in the PHA's inventory. Page 1 of 8 http://www.hud.gov/offices/pih/centers/sac/deml-10 -io/ 4/13/2009 Demolition and Disposition -HUD HUD TDC Guidance To evidence obsolescence, PHAs must show that the necessary modification and/or rehabilitation to the property is not cost-effective. HUD generally considers modiflwtions not to be cost-effective It costr exceed 62.5% of total development costr (TDC) for elevator structures and 57.14% for other types of structures. The TDC Notice for 2007 Is p~ZQQZ_Sg(HA1 and the TDC Notice for 2008 Is PIH_~Qg~-47rtlA,)• These Notices and all future year TDC Notices can be found at 1iUD PIH Notices„ Rules. and Reaulatjpplp, website Disposition: Due to a change in the neighborhood, the location of the development is no longer conducive to residential use. . The land on which the development was built is sufficiently valuable that the PHA can replace the existing development with an improved development at no cost to HUD. • Leasing the development to another entity, or transferring the title of the development via a sales contract, may be determined to be more cost- effective or efficient way for the development to be used for low-income or mixed-income housing, because that party will have access to funds not available to the PHA. (Note that a lease of more than one year is considered to be a disposition by HUD.) • The development includes vacant land or non-dwelling structures that exceeds the need of the development (after Date of Full Availability--DOFA). • The development includes vacant land or non-dwelling structures that are. incidental to, or do not interfere with, the continued operation of the remaining portion of the development. • The PHA has otherwise determined that the disposition is appropriate for reasons that are consistent with its goals of the PHA and its PHA Plan and that are otherwise consistent with the U.S. Housing Act of 1937. Dispositions in support of Housing developed pursuant to 24 CFR 941 (Subpart F) a ,- #•. The revision to 24 CFR 970 that was published on October 24, 2006, and took ?~;~` effect November 24, 2006, included a new provision at 24 CFR 970.3(12) which +~ ~`" provides that dispositions for mixed-finance housing developed in accordance with 24 CFR 941 (Subpart F) are NOT subject to 24 CFR 970. However, these dispositions are still subject to Section 18 of the Housing Act of 1937 (the "Act"). Accordingly, the SAC intends to process these disposition applications under a "streamlined" review process to verify the PHA is in compliance with the requirements of Section 18 of the Act. While the SAC is not providing an exact turn-around time for these Subpart F disposition requests, the reduced submission requirements for PHAs will greatly expedite the SAC's review process The submission requirements dispositions of public housing in support of housing development pursuant to Part 941 can be found in the new HUD-52860 (10/2007). Because the SAC need only verify that the PHA is in compliance with the Section 18 of the Act and not 24 CFR 970, the submission requirements for these dispositions are considerably less than those required for other dispositions. Thus, the SAC intends to process these disposition applications under a "streamlined" review process. While the SAC is not providing an exact turn-around time for these disposition requests, the reduced submission requirements for PHAs will greatly expedite the SAC's review process. - Frequently Asked Questions: 24 CFR 941 Subpart F dispositions (MS-Word, 40 KB) Lease Dispositions HUD considers a disposition of public housing property to include both sales of fee title and ground leases longer than 1 year. Therefore, a PHA may apply and receive a Section 18 disposition approval from the SAC for a ground lease of public Page 2 of 8 http://www.hud.gov/offices/pih/centers/sac/demo- ~ ~ ~-o/ 4/13/2009 Demolition and Disposition -HUD housing property for any duration between 1 year and 99+ years. If a ground lease terminates or expires prior to the length of time in which the PHA would have been required to operate the property as public housing as indicated in the chart below, the PHA must record a new Declaration of Trust (DOT) or use restriction on the properly in favor of HUD.. Acq ion or Property acquired or developed with funds from the U.S. Development ou g o mus a op is ousma for a" Funds 40 y is ins on the date on which the ro ect be es avai able for occ~ancy, a_s determined D. This 40-year eriocTis a to her fundin such as apital Funds or Operating Funds. Capital Fund Property modernized or receiving assistance of Capital Funds from the U.S. Housing Act of 1937 must be operated and maintained as public housing fora 20-year period that begins on the latest date on which modernization is complete or assistance is provided with Capital Funds covered by the Capital Fund ACC Amendment. The 20-year requirement may extend the use of the property as public housing beyond the original 40-year ACC requirement or beyond any requirement incurred as a result of receiving Operating Funds. Operating Property that receives Operating Funds from the U.S. Housing Fund Act of 1937 must be operated as public housing fora 10-year period beginning upon the conclusion of the fiscal year for which such amounts were provided. The 10-year requirement may extend the use of the property as public housing beyond the original 40-year ACC requirement or beyond any requirement incurred as a result of receiving Capital Funds. Page 3 of 8 Upon expiration/terminatirri of a ground lease approved by HUD under Section 18, the PHA should contact its HUD Field Office to discuss the following: . the PHA's plans for the future use of the property (e.g. ACC units, other low- income housing units); and . the correct form of DOT/use restriction that the PHA should record against the property. HUD may require that aDOT/use restriction contain certain use provisions and/or provisions which prohibit the PHA from selling or otherwise encumbering the property without HUD approval. Resident Consultation/Offer of Saie Resident consultation is required both at the development level, at the Housing Authority-wide level and with the Resident Advisory Board (RAB) for all applications. A description of the manner in which resident consultation was accomplished must be included with the application. Copies of any written comments received, as well as the responses to those comments, must also be included with the application. For some proposed disposition activities, the Housing Authority must offer the development, or the portion of the development affected by the proposed disposition activities, to: . The resident organization in place for that development. . Any group representing the residents of the development that has expressed a previous interest in the development. Replacement Housing Ptan (RHP) Except for disposition of developments based on the value of the property, replacement housing plans are no longer required as part of an application for Demolition/Disposition. Resident Relocation The Uniform Relocation Assistance and Reai Property Acquisition Policies Act of 1970, as amended (Uniform Act or URA) often does not apply to Section 18 actions. However, there still are requirements for the relocation of residents as well as record keeping duties an HA must perform to demonstrate due diligence. The Office Of Community Planning and Development (CPD) relocation staff have http://www.hud.gov/offices/pih/centers/sac/dem<-12 -~o/ 4/13/2009 Demolition and Disposition -HUD assisted SAC by preparing the guidance materials below, to meet these needs. This guidance should be used by HA's to formulate their relocation plans, as well as by Field Offices in their monitoring of an HA's Section 18 implementation. • ~ - Section 16 TA & Recordkeepirt9 Policy (This tlocument Is currently under revision. Thank you for your patience) Method of Sale/Future Use Information If a PHA s~poGposing to dispose of public housing property in order to allow for the development"of other housing, the PHA should provide detailed information to the SAC- about that future housing development (i.e. name of acquiring entity, number of ACC units, number of low-income housing units, number of market-rate units, etc.). An example of the chart that will be included in SAC's approval documents is as follows: Development Name, Development Number Building/s: xx, Unib: xx, Acres: xx Total Units to be Redeveloped: xxx Low-Income Less than 80% of AMI ACC Non-ACC Market Rate Rental Xx Xx Xx Sale Xx Xx Xx Acquiring Entity ABC Development, LLC Method of Sale Negotiated Sale at less than FM V, Ground lease for XX Years etc. Sale Price or Lease Price ;250,000, Donation, Nominal, $xx per year etc. Purpose Development of Housing Development pursuant to 24 CFR 941(F), LIHTC Units, Day Care Center, etc. Download the SAC Approval Chart • Property Approved for Disposition at Below Fair Market Value-Future Use of Property If the SAC's disposition approval is for an amount at less than FMV, the SAC approval documents will specify the approved future use of the property. The PHA is responsible for ensuring that the approved future use is complied with for the length of time in which the PHA would have been required to operate the property as public housing as indicated in the chart below: Acquisition or Property acquired or developed with funds from the U.S. Development Housing Act of 1937 must be operated as public housing for a Funds 40-year period that begins on the date on which the project becomes available for occupancy, as determined by HUD. This 40-year period is extended if PHA receives other funding, such as Capital Funds or Operating Funds. Capital Fund Property modernized or receiving assistance of Capital Funds from the U.S. Housing Act of 1937 must be operated and maintained as public housing fora 20-year period that begins on the latest date on which modernization is complete or assistance is provided with Capital Funds covered by the Capital Fund ACC Amendment. The 20-year requirement may extend the use of the property as public housing beyond the original 40-year ACC requirement or beyond any requirement incurred as a result of receiving Operating Funds. Operating Property that receives Operating Funds from the U.S. Housing Fund Act of 1937 must be operated as public housing fora 10-year period beginning upon the conclusion of the fiscal year for which such amounts were provided. The 10-year requirement may extend the use of the property as public housing beyond the • original 40-year ACC requirement or beyond any requirement incurred as a result of receiving Capital Funds. Page4of8 http://www.hud.gov/offices/pih/centers/sac/demo _13 _ o/ 4/13/2009 Demolition and Disposition -HUD If a PHA's plans change and the PHA no longer wants the property to be used as approved by the SAC, the PHA must apply to the SAC for an amendment to the disposition approval. HUD Field Offices are not authorized to approve an amendment of the use of the property. However, HUD Field Offices may monitor the term of the future use for compliance with the disposition approval documents. If HUD finds that the property is not being used according to the approved use, it may take any actions it deems to be appropriate, including actions related to the PHA's enforcement of any reversion/termination provisions in the disposition documents. If the property does revert to PHA ownership, the PHA must record a new Declaration of Trust (DOT) on the property for the duration for which the PHA was required to operate the property as public housing had the property not been disposed. Use of Proceeds Sales Proceeds from section 18 Dispositions PHAs may realize gross proceeds from a disposition action. With HUD approval, PHAs are permitted to use proceeds to pay the reasonable costs of the disposition, including costs associated with relocation of displaced residents and remediation costs. Pursuant to Section 18(a)(5)(A) and unless waived by HUD (24 CFR 970.9 (b) and 5.110), PHAs must use any remaining net proceeds to retire outstanding debt used to finance the original development. The SAC automatically assumes that PHAs wish to request a waiver to repay outstanding obligations issued to finance the original development and will begin the process of obtaining any necessary waivers from HUD's Assistant Secretary of Public and Indian Housing (PIH) upon receipt of a disposition application from a PHA. If any net proceeds remain after the disposition costs and debt (if applicable) have been paid, with written HUD-approval, the PHA may use net proceeds for any eligible purpose listed under Section 18(a)(5) of the Act, which provides that proceeds may be used for: (i) the provision of low-income housing or to benefit the residents of the PHA; or (ii) leveraging amounts for securing commercial enterprises, on-site in public housing projects of the PHA, that are appropriate to serve the needs of the residents. The Act defines low-income housing as decent, safe, and sanitary dwellings assisted under the Act. Accordingly, the. provision of low-income housing under Section 18(a)(5) of the Act is limited to public housing units under an ACC or housing assisted by the Housing Choice Voucher Program. PHAs anticipating net proceeds from a disposition should include a narrative description of how they intend to use the net proceeds in their disposition applications. The SAC will review the use specified by the PHA and, if it complies with the Act, approve the use. Once HUD approves a disposition application and the PHA's stated intended use for net proceeds, the PHA cannot change its use of those proceeds without the prior written consent of HUD. PHAs are also advised that pursuant to 24 CFR 970.35, they must report the use of net proceeds to their HUD Field Office by providing a financial statement showing how the funds were expended by item and dollar amount. A non-exhaustive list of some of the acceptable uses of sale proceeds from a Section 18 disposition include: (1) repair or rehabilitation of existing ACC units; (2) development and/or acquisition of new ACC units; (3) provision of social services for PHA residents; (4) implementation of a preventative and routine maintenance strategy for specific single-family scattered-site ACC units; (5) modernization of a portion of a residential building in the PHA's inventory to develop a recreation room, laundry room, or day-care facility for PHA residents; and (6) funding of aHUD-approved homeownership program authorized under Section 32, 9, 24 or any other Section of the Act, for assistance to purchasers, for reasonable planning and implementation costs, and for acquisition and/or development of homeownership units; (7) leveraging of proceeds in order to partner with a private entity for the purpose of developing mixed-finance housing (that will include ACC units) under 24 CFR 941 (Subpart F). If a PHA is proposing to use net proceeds for the acquisition or development of new ACC units, it should indicate the approximate number of units it plans to develop. If a PHA is proposing to rehabilitate existing ACC units in its inventory, it should include the development number(s) of those units, the number of units to be rehabilitated, a budget, and a statement of work. If the PHA is proposing to provide social services or other benefits to its residents, the PHA should include Page 5 of 8 http://www.hud.gov/offices/pih/centers/sac/demc _~ 4~ o/ 4/13/2009 Demolition and Disposition -HUD information on the number of families it will service and what services it will provide. • Sales at Less than Fair Market Value: Requirement of Reverter Clause Although HUD normally requires PHAs to dispose of public housing property for not less than fair market value (FMV), HUD may approve a sale at less than FMV if a PHA is able to demonstrate to HUD that the disposition will result in a commensurate public benefit and will be in the best interest of the PHA or the federal government. However, as part of its approval of such a negotiated sale at less than FMV, HUD will require that the disposition documents (e.g. deed, ground lease, etc.) contain a reverter clause to ensure that the property will be used for the purposes outlined in the disposition application for the period that the Declaration of Trust (DOT) on the property would have remained but for the disposition. The reverter clause will provide that if the property is not used for the intended purposes for this period, it shall revert to the PHA. If a PHA has preferred reverter language that it would like to use in its disposition documents, it is encouraged to submit that reverter language to the SAC as part of its disposition application. If a PHA is proposing to dispose of public housing property at FMV, HUD will not require a reverter clause. Sale Proceeds and Asset Management (Section 18 Disposition) In its written approval letter, the SAC will restrict the use of any proceeds that a PHA may realize from a Section 18 disposition to a specific low-income housing purpose (e.g. ACC, Section 32, or Section 8). Accordingly, under asset management, proceeds from Section 18 dispositions will always be restricted program assets and will always maintain their federalized identity. When a PHA realizes net proceeds from a Section 18 disposition, it should recognize any gain or loss on sale on the income statement associated with the balance sheet where that asset is recorded. If approval has been obtained to use • the sales proceeds for activities outside the original AMP, the PHA should then, when the time is appropriate, transfer those proceeds to the other project or program where the use has been permitted. For example, if the SAC approves the use of Section 18 proceeds for the modernization of a certain AMP, the PHA should, first, recognize the gain on the income statement of the original project but then transfer the funds to the project where the modernization-work will occur. Any retained sales proceeds should be reflected as a "restricted" asset on the balance sheet (restricted for the uses specifically approved by the SAC). A PHA must use net proceeds in accordance with the spending and financial reporting requirements under the revised 24 CFR Part 990. Please consult a HUD financial manager for additional guidance and/or clarification of these reporting requirements. Demolition/Disposition Technical Assistance Package Technical assistance, in the form of a Demolition/Disposition Technical Assistance Package for application preparation, is available and can be downloaded from this site. Please note that Form HUD-52680 is included in the package. Technical Assistance is also available from Special Applications Center Man~.gement. - Go to the pernQlitio~!_QasraQ~isiaA_7~ahnisai..~s~i~xans~_.P~&Ka~ya page. Local Approvals PHA Board Resolution: Applications must receive formal approval from the Housing Authority's Board of Commissioners in the form of a resolution. The resolution must be dated after the date of the last resident meeting, after the date of all letters of support from appropriate local government officials, and after the offer of sale, if applicable. Local Government Consultation: The PHA must obtain a letter from each • appropriate local government official with jurisdiction over the affected development that the local government supports the proposed demolition/disposition action. In addition, the PHA must include in its application to the SAC a description of the process of its consultation with local government Page 6 of 8 http://www.hud.gov/offices/pih/centers/sac/demc _~ 5, o/ 4/13/2009 Demolition and Disposition -HUD officials which summarizes the dates, meetings, and issues raised by the local government officials, and the PHA's responses to those issues. Phased Demolition Applications Due to the potential impact on a PHA's asset-repositioning fee (or phase out of operating subsidy) based on the relocation date in the PHA's demolition or disposition application, a PHA may wish to demolish (or dispose of) different buildings in-one development in multiple phases (e.g. a PHA has three high-rise buildings or scattered-site units in one development that it wishes to demolish pursuant to a staggered timeline). Rather than submitting an application for a partial demolition or partial disposition (which may trigger additional statutory or regulatory requirements), a PHA may do this by breaking down the submission of ONE demolition and/or disposition application into multiple application numbers in PIC (e.g. so that each phase of the demolition and/or disposition will have a different DDA number). However, if the same supporting documentation applies to all application (DDA) numbers, the PHA need only submit supporting documentation (e.g. board resolution, government consultation, etc.) with only one application. By creating a separate application number for each phase, the PHA will be able to designate a separate relocation date(s) for the buildings/units for each phase. HUD will approve the removal for all of the units in a development at the same time and up-front, even though a PHA will be able to implement the removal (and relocation) in stages. A PHA can also request that a HOPE VI demolition be broken down into multiple application numbers. In HUD's approval documents for such a removal, the different relocation dates will be referred to by application number. An example is as follows: Number of dayc after HUD approval that the PHA will begin relocation of residents Application Number (for Phase of Application) Number of Days DDA0001111 90 DDA0001112 180 DDA0001113 270 Application Review and Approval SAC will accept only electronic submissions made via the PIC Inventory Removals module. For those applications, which cannot be made electronically, they may be sent to the SAC for review. For any applications or attachments sent as paper to SAC applicants should also send copies of the application to their local HUD field office. Field Office input Since the SAC is working for the local Field office, it will be asking their opinion of the application. The Field also has the responsibility to sign-off on any environmental reviews conducted in connection with the application. SAC will be documenting its review file by asking the field to provide the information in a document similar to the one below: Fieid_Office Certification_Demo=Disp_o.. (MS-word, 31KB) Submission requirements The Executive Director's signature on the certification page may be FAXed or scanned and attached electronically to the rest of the application. Note: When attaching supporting documents to the application, PIC users can attach documents with filenames with spaces provided filenames are no longer than 25 characters (including file type ending, e.g., ".doc"), and as long as filenames conform to Windows Explorer file naming rules: filenames with spaces must be enclosed in quotation marks. Example: Filename as shown in MS Word: PIC FAQ Ideas.doc Filename to attach to PIC application: "PIC FAQ Ideas.doc" For hard copy applications, applicants should submit one original of the application to the Special Applications Center in Chicago for review and a copy of the Page7of8 http://www.hud.gov/offices/pih/centers/sac/demo _~ 6 ~ ~o/ 4/13/2009 Demolition and Disposition -HUD application to their local Public Housing servicing office. The address for the SAC is listed below: • Special Applications Center US Department of Housing and Urban Development 77 West Jackson Boulevard Room 2401 Chicago, IL 60604-3507 Telephone: (312) 886-9754 Fax: (312) 886.6413 Content current as of 7 January 2009 Back to top FOIA Privaev Web Policies and Important Links ~~ 'mss" U.S. Department of Housing and Urban Development ~~ 451 7th Street S.W., Washington, DC 20410 ~ ~` '~' Telephone: (202) 708-1112 TTY: (202) 708-1455 Find the address of a HUD office near you Page 8 of 8 http://www.hud.gov/offices/pih/centers/sac/demc _17 -.o/ 4/13/2009 ~xtm-53010$ Page 1 .. Nc~ve~ber 1969 • U. S. DEPARTMENT OF HOUSING AND I~4.BAN DEUII.OP1~lII~IT LOW--RENT PUBIC HOUSING Project No. MINK 74 1 CONSOLIDATED CONTRACT N0.'~,:~8 ANNUAL CONTRIBUTIONS CONTRACT PART ONE ~iIS AGREEMENT, entered into as of the ~~ day of , 197°, (herein called the "Date of This Contract"), by and betwe the United States of Ameriga (herein called the "Government"}, pursuant to a United States Housing Act of 1937 (42 U.S.C. 1401, et seg., which Act as amended to the Date of This Contract is herein called the "Act") and the Department of Housing and Urban Development Act (5 U.S.C. 624), and the Housing and Redevelopnent Authority of Mound, Minnesota: (herein called the "Local Authority"), which is a body corporate and politic organized and existing under the laws of the Stat® of Minnesota (herein called the "State") and a "public. housing agency" as defined in the Act, WITNESSETH: In consideration of the mutual covenants hereinafter set forth, the parties hereto do agree, as follows: Sec. 1. Project, Cooperation Agreement, and Maximum Limitations • (A) The Local Authority is undertaking the development or acquisition. and operation of low-rent housing as defined in the Act, as follows: Statutory Maximum Estimated Estimated Development Cost Development Cost Number of Total De- of Construction of Construction Initial Project Dwelling velopment and Equipment and Equipment Loan No. Units Cost Per Room Per Room Commitment MILAN 74 1 50 $ 808,800 ~ 4,000. ~ ~ 3,657. ~ $80,800 ~ Specifically designed for elderly occupancy. (B With respect to such low-rent housing in compliance with Sec. 10(s), Sec. 10~h), and Sec. 15(7)(b) of the Act the Local Authority has entered into, and the Government has approved, an agreement or agreements with the governing body or bodies of the locality or localities in which such housing is or will be situated, as follows: Project No. Governing Body of: Date of Agreement MILAN 74 1 Village of Mound, Minnisota April 15,1968 Such agreement or agreements collectively are herein called the "Cooperation • Agreement: " -19- xuD-53oloa Page 2 November 1969 (C) The Local Authority shall proceed with the timely development of the Projects identified in this Sec. 1 in conformity with such dates. for the completion of various stages of development as are established for the Projects by the Government and transmitted to the Local Authority by letter.. (D) If the Local Authority shall fail to prosecute diligently the develop- ment of any Project as required by subsection (B) of Sec. 102 or to proceed with the timely development, as described in subsection (C) of this Sec. 1, of any Projects and the Government has notified the Locaa Authority of such failure, the Local Authority shall suspend the development of the Project and shall take whatever action is necessary to conserve monies and assets and to stop overhead expenses and losses with respect to such Project. Upon the award of the Main Construction Contract (as defined in Sec. 107) for any Project comprising a number of units less than the number of units specified for such Project in subsection (A) of this Sec. 1, the Local Authority shall suspend the development of the remaining number of units and shall take whatever action is necessary to conserve monies and assets and to stop overhead expenses and losses with respect to the remaining number of units unless (1) a Development Program for the remain- ing number of the units has been submitted by the Local Authority and approved by the. Government and (2) this Contract has been amended to (a) specify the re- duced number of units and Development Cost of such Project, and (b) identify the remaining number of units by separate project number and .specify the Develop- ment Cost therefor. Arty,monies in the General Fund for the development of a Project, suspended in whole or part, in excess of the monies needed therefor under the aforesaid limitations shall be promptly applied to the payment of any Advance or Temporary Notes outstanding in connection with such Project. (E) The Government shall not be obligated to make any further advances (except such advances which the Government determines to make to the Local Author- ity for its payment of approvable obligations incurred prior to the notice by the Government to the Local Authority or award of the Main Construction Contract referred to in subsection (D) above) or any annual contributions in respect to any suspended low-rent housing unless and until the Local Authority demonstrates to the satisfaction of the Government that it is willing and able to proceed expeditiously with the development of such suspended low-rent housing and the Government, in its sole discretion, determines at that time that it shall render financial assistance to the Local Authority with respect to such housing. (F) The amount of the advances made by the Government on account of the loan for any suspended low-rent housing together with interest thereon at the applicable Loan Interest Rate to the date of repayment, shall be paid from any funds of the Local Authority available therefor, including the annual payment of all receipts in excess of expenditures necessary for management, operation, maintenance, and reasonable reserves in connection with each low-rent housing project (under this Contract or any other contract between the Local Authority and the Government under authority of the Act) presently or hereafter developed or operated with the financial assistance of the Government or conveyed to the Local Authority by the Government, after (1) the payment of all obligations in connection with such project for which annual. contributions are pledged or (2) the Administration Period for' such project, as the case may be. (G) The provisions of subsection (D) and (F) of this Sec. 1 shall not be in lieu of any rights or remedies which may accrue to the Government by law or under this Contract but shall be in addition to all such rights and remedies. (A) The "Minimum Loan Interest Rate" shall be 6 3~8g6 per annum. The "Maximum Contribution Percentage" shall be 6.96 ~, per annum. (I) The making of this Contract and the undertaking of the loan and annual contributions as herein provided, were approved on List No. 8l~32, approved May I~ 1970 (J) Eac~i project identified in this Sec. 1 is herein called a "Project" and, if more than one Project is so identified, are herein collectively called the "Projects." Sec. 2. Development Program Each Project is more fully described in a statement (herein called a "De- velopment Program") which has been adopted by the Local Authority. Each Project shall be developed and operated by the Local Authority in compliance with all provisions of this Contract and all applicable provisions of the Act. -20- `xtm-53oloa Page. 3 ~toven~er 19b9 :.« ~. Sec. 9. Development Cost of Project The Local Authority estimates that the total Development Cost of each Project xill sot exceed the Estimated 7.btal Development Cost therefor as specified in Sec. 1, which eetll~te is approved by the Goverment. the respective amaats of each Estimated Total pevelopstent Coat, or the latest revisions thereof pursuant to the provisions of Part Two hereof, ere herein called the "MoJdmum Development Cost" of the respective Pro~eets or of all the Pro~eeta in the aggregate as the context indicates. The .Local Authority, hoxever, shall complete the development of the Projects at the lowest possible cost, and in no event at a cost in axceaa of the aggregate amount of the aforesaid Tsstimated Total Development Coate. .. Sec. k. Coat Limits ' (A) The Developaent Coet per room for construction and equipment of sash Project (e=eluding land, demolition, and Nondwelling Facilities) shall not exceed the Ha~d.mum Development Cost of Constx~sction and ggnipment Per Room specified Yor such Project in Sec. 1. i~8-ere such amount exceeds the Statutory DeTelopanant Cost of Constractioa and Equipment Per Room for aqy Project, it has bees fovad pursuant to the Act that in ttze geographical area of such Project (1) it is not feasible under said Cost li~.tation to construct such Project without sacrifice of sound standards of eoasts~vetion, design, sad livability, sad (2) there is an aeat+e need for the housing xhich will be provided b7 such Project; therefore, and in pursuauca , of the anthorizatioa in the Act, such higher Cost limitation for the conatreation -. end equipment (excluding land, demolition, and Nonds~relling Faci].itiea) par roan . for such project has been prescribed. (B) The term "Nondwelli.ng Facilities" sa used is this Contract includes nondwelling structures, spaces, and equipment, and site development, improveaents and facilities located outside building walls (including streets, Aidewelks, and , • sanitary, ntillty, and other facilities, but excluding separate heatit~ plant - atructuras, equipment, and diatribntion lines). Sec. 5. Jnst33ication for Project and Financial Assistance The Local Authority has demonstrated to the satisfaction of the (iovermaen~ that there is a need for such lox-rent housing which is not being met by p .. enterprise. The development and operation of each Project in accordance xith this Cantraci~ will provide decent, safe, and sanitary d-rellinBa within the financial reach of families xho are is 'the lowest inccaua Group and who cannot afford to gay eaaugh to cause Private enterprise in their localit~or metropo~ ~ ~ ae to build ar. adequate supply of decant, safe, and sanitary sling (which families are herein called "Faad7.i.es of Low Inoome"), and the provisions of this Contre.ct are adequate to assure that each such Project xill be developed sad operated in compliance with all the requiremetats of the Duct. me loan herein provided is necessary to assist the development oY each Project, sad the annual contributions payable by the [ioQersment i.n the amounts, for the period, and in the manner herein provided are necessary to achieve, maintain, amd asadre the low-teat character of each sacb Project. Sec. b. Tax 8'ucemptioa of Project Under the Constitnt3.on and Statutes of the State, each Project is ezempt from all real and personal property taxes xhich may be levied or i~oaed b7 the State,, city, county, or other.polj.tical subdivision. . Sac. 7. ~_an by aovernn~ent Subject to sad 3.n accordance with all the.proviaione of Part Two hereof, and in order to assist the development oY each project, the (}overt®meat shall lead to the Local Authority aioounts (the total of which is herein called the "Hazissv Lean , Commitment") as determined pursuant to Sac. X10. Each advance ~ account of the loan for any Project shall bear interest on the nnrepaid Principal mount thereof from the date the advance is Wade to the date of repayment at the rate or rates (herein called "Loan Irrtereat Rate") as the (3overn®ent deterstinee on the date such advance is made and redetermines en each anniversasq of such data parsaant to Sec. 20 of the Act: Provided, That the Loan Interest Bata for each advance, xhich shall be adausted annually as provided herein, shall not be lass than the Loan Interest Hate". ' -21- ~.: ~~ M Page 3 lfovember 1969 Sen. 3. Development Cost of Project The Local Authority estimates that the total.Davelopmeat Cost of each Project Will not ezeeed the Estimated Total Development"-Cost therefor as spec fied is Sec. 1, xh3.ch estimate is approved by the Government. The respects amoaats of such 8stimated Total Development host, or the latest revisions reof pursuant to_the proxis`i.ons of Part Two...hereof, are..herein..called the " Development Cost" of the respective Projects or of all the Projects is aggre- gate as the co~atext indicates. `The Local Authority, however, sha11 c etc the deve'opment of the Projects at the lowest possible cost, and is no vent at a cost in sxoeas of the aggregate amount of the aforesaid Estimated T al Development Costs. Sec. k. Cost Lini.ts (A) The Development Cost per roaa<for c~structioa and eq pment of each Project (ezcluding lead, demolition, and Nondpalling Fscilitie shall sot exceed the Hasirmm Development Cost of Coastrnctiam sad Egai t Per Roam specified for such Project in Sac. 1. Where such amoant exc ds the Statatory Development Cost of Construction and Egnipmeat Per Room for any Project, it has been found pursuant to the Act that in the geographic area of such Project (1) it is not feasible under said-Cost limitation to cons ct such Project without sacrifice of sound standards of constrnctioa, ign, and livability, and (2) there is an acute need for the housing which be provided by such Project; therefore, and is pursuance of the anthoriza on in the Act, such higher Cost limitation for the co~nstrnction and egnit (excluding land, demolition, and Nondwelling Facilities) per roan fox such Project has been prescribed. f (B) The term "Nondwelling.Facilities'! as u~ed is this Contract includes ao~ndxelling structares, spaces, and equipment,~and site development, improve- manta and facilities located outside bnildia{ ells (including streets, sideKalks, and sanitary, utility, and other facilitiea,/hut excluding separate heating plant structures, equipment, and distribution lin~s). Sec. 5. for Proiect and Financial A The Local Authority has demonstra d to the satisfaction of the Government that there is a need for such law-rea housing which is sot being met by private enterprise. The development and oper tion of each. Project in accordance with this Contract will provide decent, ~afea.and sanitary d;ie].linga within the financial reach of families who are in the lowest income group and who cannot afford to pay enough to cause private enterpris in their locality or metropolitan area to build an adequate supply of decent, s .e, and sanitary dWelliags for their use (which families are herein called "F es of LoK Income"), and the prov3.eions of this Contract are adequate to assur that each such Project. will be developed and operated in compliance with the,regnirements of the Act. The loan herein provided is necessary to as st the development of each Project, and the annual cantribntions payable by t~+Oe Government in the amounts, for the period, and in the manner herein provid are necessary to achieve, maintain, and assure the lox-rent character of a such Project. Sec. 6. Tea Eae~tion of Pro eat IInder the Cons tntion and Statutes of the State, each Project is ezempt from all real and' rsonal property taxes which may be levied or imposed by the State, city, unty, or other political subdivision. Sec. 7. Loan Government Subject o and in accordance with all the provisions of Part Two hereof, and in order/ to assist the development of each Project, 'the Government shall lend to th Local Authority amounts (the total'oi'tfii:ch is herein called the "Maximeum oan Commitment") as determined pursuant to Sec. lt10. Each advance on accou t of the loan for auyProject sha11 bear interest on the unrepaid princi amount thereof from the date the advance is made to the date of re- p at the rate or rates (herein called "Loan Interest Rate") as the Gone eat determines on the date such advance is made and redetermines on eac anniversary of such date pursnaat to Sec. 20 of the Act: provided, That Loan Interest Rate for-each advance, rich shall be adjusted annaally as P r i~aimum-3sosu--boreeseee'-Raaea- ~ s. -22- H[m-53oloB Page !~ iJa~nber 1969 Sec. 8. Annual Contr~butions~by Government - Subject to and in accordance with all the provisions of Part Two hereof, and in order to assist iu achieving and maintaining the low-rent character of each Project, the Government shall. make annual,.contribations to the Local Authority in respect to each Project in the amounts as determined pursuant to Part Two and for not to exceed-the period (herein called "Maximum Contribution Period") co~nencing on the date the first arluual contribution. with respect to such Project is paid and ending forty years from such date. Not more than forty annual contributions shall be made with respect to any Project. Sec. 9. Bonds and Additional Projects The Local Authority shall .authorize, issue,. and sell to others than the Government, obligations of the type prescribed is Sec. 1111 (herein ca7.led the "Bonds'), all as prescribed in Part Two of this Contract, with respect to the Projects and to any .other low-rent housing project or projects undertaken by the Local Authority with financial assistance of the Government which, pursuant to mutual agreement of the Local Authority and the Government, may be incorpo- rated under the terms of this Contract. Sec. 10. National Emergency (A) The Local Authority shall, (1) daring any period of national emergency in connection with national defense as declared by the President of the United States or any period during which a state of war between the United-States and ar~*foreign power exists, and (2) upon either a determina- tion by the President of the,United States that there is an acute shortage of housing in the locality of any Project-which impedes the national defense and that the necessary housing would not otherwise be provided when needed for persons engaged in national defense activities, or a determination by • the President of the United States that there is an acute need for housing in the locality of any Project to assure the availability of dwellings far persons engaged in national"defense activities, to the maximum extent authorized or permitted under applicable Federal and State laws then in effect, operate such Project to provide housing for persons engaged in national defense activities. (B) If, by reason of any such emergency or state of war, the con- struction of any Project is either prohibited or stopped prior to the delivery of Bonds and it appears that such prohibition or stoppage of construction will oontinue for an extended period, the Local Authority shall refrain from the award of any further Construction or Equipment Contracts, shall take in respect to Construction or Equipment Contracts alr®ady let whatever action is reasonably necessary to conserve monies and assets (inclading termination or settlement of arty outstanding Ca~nstruo- tion or Equipment Contracts), and shall take all other reasonable actions necessary to minimize overhead expenses and losses. Any monies in the General Fund for the development of such Project in excess of the amounts needed therefor under the aforesaid limitat3;o~ns; sha]1, upon request of the Government, be applied to the payment of any Advance Notes or Temporary Notes issued in connection with such Project, and the Government shall not be obligated to make stay further advances with respect to work ender Construction or Equipment Contracts until such prohibition or stoppage is ended. Nothing in this subsection (B) shall be construed as prohibiting the Local Authority from proceeding with site acquisition and the completion of plans, drawings, specifications, and related documents. Sec. 11. Incorporation of Part Two in this Contract For comrenience, various provisions of this annual contributions contract - are embodied in a separate document designated "Terms and Conditions" being Form HUD-$3011, November 19b9, whirr (as modified by Sec. 12) constitutes Part • Two of this Contract. The provisions, terms, covenants, and conditions em- bodied in Part Tyro are binding upon the parties hereto, with-the same effect as if set forth in fall in this Part One of this Contract. The term "Contract" as used herein shall mean the annual contributions contract, consisting of this Part One thereof and the Terms and Conditions constituting Part Two thereof. -23- H~JD-53010B Page 5 November 1969 Sec. 12. Additional Provisions and Modifications The following additional provisions, and modifications of either Part Case or Part Two, as hereafter set forth constitute the only modifications to this Contracts (A) Nondiscrimination in Housing (1) In connection With the development and operation of any program or activity of the Local authority receiving Federal financial assistance under the IInited States Housing Act of 1937, regardless of when such program or activity, or any portion thereof, xas initially covered by any contract for such assistance, and for as long as the real property or structures thereon in such program or activity, or any portion thereof, is used for a purpose for which the Federal financial assistance was extended or for another purpose involving the provision of similar benefits, the Local Authority will comply with all requirements imposed by title VI of the Civil Rights Act of 1964, Public Law 88-352, 78 Stat. 241; the regulations of the Department of Housing and IIrban Development issued thereunder, 24 CFR, Subtitle A,-Part 1, section 1.1 et ~.; and the require- ments of said Department pursuant to said regulations; to the and that, in accordance with that Act and the regulations and requirements of said Department thereunder, no person in the United States shall, on the ground of race, color~or national origin, be excluded from participation in, be denied the benefits of, or be otherwise sub3ected to discrimination under any such program or activity. The Local Authority Will, by contractual requirement, covenant, or other binding commitment, assure the same coaapliance on the part of any subgrantee, contractor, subcontractor, transferee, successor in interest, or other participant in the program or activity, such commitment to include the following clause: "This provision is included pursuant to the regulations of the Department of Housing and Urban Development, 24 CFR, Subtitle A, Part 1, section l.l, et se ., issued under title VI of the said Civil Rights Act of.l~b4, and the requirements of the said Department pursuant to said regulations; and the obligation of the contractor or other) to comply therewith inures to the benefit of the United States, the said Degartment, and the Local Authority, anry of which shall be entitled to invoke aRy remedies available by law to redress any breach thereof or to compel compliance therewith by the contractor or other_7" (2) The Local Authority shall not, on account of creed, discriminate in the sale, leasing, rental, or other disposition of housing or related facilities (including land) included in any Project or in the use or occupancy thereof, nor den,Y to ax~r family the opportunity to apply for such housing, nor deny to ax~q eligible applicant the opportunity to lease or rent aRy dwelling in any such housing suitable to its needs. (3) Failure of the Local Authority to comply with the requirements of (1) or (2) above shall constitute a Substantial Default under any contract between the Government and the Local Authority covering Federal financial assistance under the United States Housing gat of 193?, and 'this Section shall be construed to apply so long as any such contract is in force or effect. The Local A~u ,certifies that all conditions precedent to the valid execution and delivery of tFiis--Sontract on its part have been complied with, that all things necessary to cons ti ni.fl_Contract its valid, binding, and legal agreement on the terms and conditions ana`~ purposes herein set forth have been done and have occurred, and that the eae~t and delivery of this Contract on its part have bean and are in all respects du rized in accordance with law. The Government similarly certifies with reference -24- xun-53oloB (~ttt) Rage 6 November 1969 pursuant to a Contract of Sale to be entered into between a seller and the Local _Authority: Prior_to-the-execution of-aneh-Gontraet ot-Sale....-the-Loea7.-Authority- issue aLetter oS' Intent to tt~a seller to enter iato such Contract. Such Let of Intent and such Contract shall bear the written approval of the Govercasea Failure of the Local Authority to expeditiously continue the ~mdertaking of ject or to comply with the Letter of Intent or Contract, or if the Letter o~'Tntent or Contract is held to be void, voidable or ultra wires, or if theme er or right of the Local Authority to issue the Letter of IntaYrt or enter i~+ti the Contract of Sale is drawn into question i.n a~ legal proceeding, or if the,-fiscal Authority asserts or claims that the latter of latent or Contract, is aox'"binding upon the Local Authority for any such reasons the occurrence of spy finch event, if the seller is not in default, shall constitute a Sabstantial~,AdYault for the purpose of Article 0 hereof and, in such case, the Government ~n continre the undertaking of the Project and will take delivery of such right, tithe or intereBt in the Project as the Local Authority :sap have and perform sash ;,after of Intent or Contract oY Sale, as the case may be. The provisions of 's paragraph are made with, and for the benefit of, the seller and his assign who will have been apecifieafilp approved by the Government prior to such a gamest. To enforce the performance of this provision the seller and such ass sea, as well as the Local Authority, shall have the right to proceed against Government by action at law or suit in equity. Ia order to assist in financ the acgnd.sition cost (herein called Development Cost) of the Pro3ect the ernment, notwithstanding the provisions of See. 1410, shall lend to the Local thorny an amount equal to the 2Ssaimnm Development Cost of the project: Provi ,that the Government shall not be obligated to make annual contributions respect to the Project until the Local Authorit~~;~.y~i d s.~ i an.~~_nr r_s - -- Sec. 13. Part One of this Annual Contrilautions Contract is hereby modified • in the following respects: (1) Part One, Section 2 is revised to read as follows: "Each Project is more fully described in a statement (herein called a 'Development Program') which has been adopted by the Local Authority. Each Project, incluidistg such changes thereirs (whether in the numaber of dwellings to be provided thereby or other-riae) as may be made Eros time to time with the approval of the Government, shall be developed aad operated by the Local Authority, in compliance with all provisions of this Contract and aZl applicable provisions of the Act, as one Public Housing Project.uader the laws of the State of }li.nnesota." (2) Part One, Section 9 is revised by adding the following sentence thereto• "No provision of this Annual Contributions Contract shall be construed to establish any obligation to use the proceeds of Bonds issued for, or revenues authorized for or derived from, the Projects to gay the Bonds or cost of, or make contributions or loans to any other Public Horsing Project until the Bonds and cost of the Projects shall be fully paid." Sec. 114. Performance of Conditions Precedent to Qa].idity of this Contract The Local Authority certifies that all conditions precedent to the valid execution and delivery of this Contract on its part have base complied with, that all things necessary to constitute this Contract its valid, binding, and legal agreement on the terms and conditions and for the prrposea herein set forth have been done and have occurred, and that the execution and delivery of this Contract • on its part have been and are in all respects duly authorized in accordance with law. The Government siailarly certifies with reference to its own execution and delivery of this Contract. -25- Page 6 l~avember 1969 IN WITNESS WHER~'~ The Local Authority and the Govsramemt canned this Contract to be eaecnted in their respective names and hav suaed their ..respective.. seal~_to be_hereunto affixed and__attested_as-of Dais_of This__ Contract first above xritten. __ _ _ (SEAL) Attests $~ - UNITED STATES OF ANIFRICA Secaretary of Housing and Urban (SEAL) Developanent Attest: By 245519-P FIITD-wash., D. C. - 2 V - ACID-X30108 • Pag6 lfove~er 1969 ~ y,R~rgg y~pg, The Local Authority and the t3overnaent have caused this Contract to be e~oecgted in their respective unman and the tacal Authority hsa caused its seal to be heroIDlto afti~ad acid at~edted as of the Date of This contract first above xrstten. ~s~) AT 9`t ~~ ti~ Secretary Housine & Redevelornnent Authority of .Mound. Minn. r, i ~~ / Chairm~'n HIQT&D STATES OF AliSSICi Sacretazq oP Hoasiag and IIrban development .,i~Cltng Assiataat $egional Adudnistrator for ~onsing Assistance GZ~ ~-a G~, ~~ ~'I ~ 1~ t ,3' • _27_ American Reca~~cry and R~nvesirment pct {AR1~A'~ Pc~imt:tla Grant Cap~taF '[and f'rogr~m ~s. ;D,epartmer~k of Hocising (~~P} l~mendrrkent and >Jrb~n Deveaupm~nt To The Cortsofidated Annual Contributions office of pubic $rsd Endian r~tt,usir,~ __,_- --------_ -_. __-_- ----- --.._- _.------- . __---- Cpntr~irt {tgrrrk HUB-5341:0 a d thBe iJnited StaHesuof AmericariSecretary of Hou~singa d Ltrban Q~ o~~eno {hereinrcailedilHUD"lVentered into Const~liciaked Annual Contributions ~ntraat~s~ ACC{s) Plumberjs) C-86~ dated`., i~'~x~i Whereas, htUD has agreed to provide American Recovery arld Rei+iveStrrient,Act (ARRA) assistance. upon execution of t{afs Ame~ndrnenf, to €he PHA in the amount to be specified below for the parpose of assisting the PHA in carrying out capital and manafiioment ac8vitias at public housing daveloprnehts ±n accordancewtththe requirements of the ARRA including Title XVI gantara! provisions of the ARRA. in oCd~r to ensurethat such developments t~ntlnue tt) be avaf#able io serve tourincomefamiiies: 5 *~5t3 for Fiscal Year 29t>9to be referred ip under Capital FundGrarrt Number Mhl45S{J745Q1Q9 Pi-fATax identificationNumber {~'Ifi3j: On Fife YVIt'#8s. HUD and the PHA are enteringinto the CFP Arnendmenk Numt3er , 'y _ 1~+7rt~t""P'3~reretore, the ACG(s) is {are) amended as follows: ~. This grant is conditioned on the acceptance of the PHA io ctrrt~piy sntit~ 1, The. ACC(s) is {ar®} amended to provide CFPassistance in tip the reporting requirements of the ARRA and the #ollowing requirements: arttount specified above for capital and management activities of PHR a_ Funds cannot be transferred to operations dr used for rental assistance developments. This amendment is a part oftho ACG{s). activities. ~. The capital and management activities strati be carried out in aceordarace wfth a!l HUD regulations artd other requtremants appticat)ie to the Dapitai Fund Program and ARRA and "rn accordance with the PHA's current 5-year Capital Fund .Plan, 3.5ubject to the provisions of the ACC(s) and to assist in the CepEtal and management activities, HUD agrees fo disburse to the PHA #r tine tiesignatedirustee #rom timeio time as needed up tathe amount ofkhe fundin assistance specified herei ,,~~;,,~ ~', The P s a ca rnue to operate each development as low-income housang'in compliance with the ACC(s), as amended, the Act anti elf }~tUD regulations fora period of twenty pears aiterthe last disbursement of CFP+`ARRA assistancofor modernization activities and for a periodof tooty years after file iastdistribution of CFA'/ARRA assistanoo for development activities. Provided further that, for a period of ten years following the Las payment nt assistance from the Operating Fund to fhe PHA, no disposition of any development covered by this amendment shah occur unless approv©d b HUD. >~:~~-'~'"•"`""~'w ~#" doesnofcompiywith any of its obligations under this'~~~ Amendment, HUDshail irnposesucn penakies Ar take such remedial action as provided by taw. HUD may dtreet the PHA to terminate aJl work. In such case, the PHA shall only incur additional costs wish HUD b. ThePHA must obiigala f00°Ia a#the grantwithsn aneyear of ih~ eftectivo date. At theone year date any unobligated funt~ wit! be recaptured. c. Tho PHA must expend at least 64°Fo of the grant wi~in two years of tti'e~ effective date. At the two year date it loss than 80~fo is expended any .unexpended funds will tae recaptured. d. The PHA must expend 1017% of the grant within 3 years oftheeiFective date. At the three year date any unexpended funds wilt be recaptured. e. Extensions to the obligation and expenditure dates are not perrnitked. 1. The PHA mast submit an annual statement and board resoiutibn no Later than 2~i calendar days from the effective date. g. The PHA shall give priority to capital pro#ects that can award coniracfs based on bids within 120 from th$ effective date. h. The PHA,shall give priority consideration to the €ehabi(itation of vaca~rtt rental units. i. The PHA shell prioritize eagital projects that are already ui3derway bt ]ncluded in the 0-year C~ltBl Fund Plan. j. The PHA must use the lands provided in this grant to s;uppiemeni expenditures not supplant. expenditures from other Federal, State, of iocai sources or 1Ernds indopendankiy ~en0raked by fhe grarsea. tc. The PHA wlii provide a physical ,needs assessmehi, as specified by HUD, using {ands from this grarsi cr other Capital Funds. 1. Requsrements relating to the procurement ofgoods atfdsan~i~s a'r('sfrr~'. under state and focal laws and regulations shall not applyto the _GFP assistance provided by this agreement. approval, ~. Tne PHA acknowledges; its responsibt}ity for adher~nae tCt i1Sfa 6. By execution of this amendrtnent al( PHAS that are PHAS troubled a~n7eedment_ a4knowtetiga and agree to edditiCirtal monittfrtng and oversight by HUD -and its agents/contractors as deemed appropriate and necessary in order to ensure the proper use of the funds received by this arnendrnent: The parties have executed this Agreement, and it wilt be effective crh ~3118l2009 :This is the date on which CFP assistance becomes avai€afaie tc the PHA for obligation. ~Uy~: at-t.of H t ~~'1 ba~n/~Dev~la sent rti,a txecunve uirector 1 ~~~~~~'° ~/"~i~ D F's-~'`~ DBte: '~'`. `r'"•~'`'"'"~"...~;-ate,-f i~~~_..-rs~±+„„..,~~ .._t .-. 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