HomeMy WebLinkAboutItem 21 - Amendment to FY 21-22 Agreement with Habitat for Humanity for Residential Rehabilitation Grant Program Community Development Agency
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Item # 21
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
February 7, 2023
TOPIC: Amendment to FY 21-22 Agreement with Habitat for Humanity for Residential
Rehabilitation Grant Program
AGENDA TITLE:
Approve a First Amendment to the FY 21-22 Agreement with Habitat for Humanity to
Administer the Residential Rehabilitation Grant Program (Non-General Fund)
RECOMMENDED ACTION
Approve a First Amendment to the FY 21-22 Agreement with Habitat for Humanity of
Orange County for the administration of the Residential Rehabilitation Grant Program to
increase it by $11,000 for a new total agreement amount of $556,532, subject to non-
substantive changes approved by the City Manager and City Attorney.
DISCUSSION
On July 6, 2021, the City Council approved an agreement with Habitat for Humanity of
Orange County (Habitat) to administer the City’s Residential Rehabilitation Grant
Program from July 6, 2021 through June 30, 2022, in an amount not to exceed
$545,532 in Community Development Block Grant (CDBG) funds (Exhibit 1). The
Residential Rehabilitation Grant Program improves and preserves the City’s housing
stock by providing grants of up to $25,000 to eligible homeowners who are low-income
and earn less than 80% of the Area Median Income as defined by the U.S. Department
of Housing and Urban Development (HUD).
The program utilizes CDBG funds to provide eligible households with grants to address
municipal code violations, undertake vital repairs, and replace and/or install major
systems of the home. After approving a homeowner’s application, the City will provide a
grant of up to $25,000 to pay for the required rehabilitation work on their home.
Properties eligible for the program must be owner-occupied and all rehabilitation work is
performed by Habitat and/or their sub-contractors. After an initial inspection by a City
Code Enforcement Officer, Habitat will be provided the final Scope of Work (including
City inspector’s notes and specifications), for which a final work write-up will be created
in coordination with the homeowner. Program participants are selected on a first-come,
first-served basis.
The City follows the requirements under 24 CFR Part 35.930(b), of the “HUD Lead Safe
Housing Rule,” for rehabilitation work not exceeding $15,000 for eligible home repair
Amendment to FY 21-22 Agreement with Habitat for Humanity for Residential
Rehabilitation Grant Program
February 7, 2023
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and $25,000 for eligible roof repair. If the home was built before 1978, the City will
conduct lead-based paint (LBP) testing, and if LBP is found, Habitat will implement safe
work practices during rehabilitation with a clearance examination of the worksite by the
City prior to project closing.
During FY 2021-22, Habitat successfully completed the rehabilitation of twenty-five (25)
homes for low-income families under their agreement. The rehabilitation work varied
from replacement of roofs and termite damaged wood, to pest fumigation, rehabilitation
of plumbing in bathrooms and kitchens, exterior/interior paint, and installation of
accessibility ramps to conform to the Americans with Disabilities Act. The City’s
partnership with Habitat is effectively improving the health and safety of housing for low-
income families, preserving the City’s housing stock, preventing families from
displacement, and addressing lead and mold contamination.
However, during their administration of the program in FY 21-22, Habitat identified
several homes that had health and safety issues such as lead and mold contamination
that required remediation efforts before issuing a notice of completion and closing the
projects. Unfortunately, these remediation efforts exceeded the allowable cost of the
agreement and resulted in an unanticipated expense of $11,000. In order to pay for
these additional expenses, staff are seeking approval by the City Council to amend the
FY 21-22 agreement with Habitat to add $11,000. The new total agreement amount will
be $556,532 for FY 21-22.
Most recently, for FY 22-23 the City entered into a new agreement with Habitat for
$480,000 following approval by the City Council. However, the funds in the new FY 22-
23 Agreement cannot be used to pay for this $11,000 in unanticipated expenses
incurred under the FY 21-22 agreement.
FISCAL IMPACT
Funding for this First Amendment to the agreement for $11,000 is available from
unspent prior year CDBG funds. Funds are budgeted and available for expenditure as
follows:
Fiscal
Year
Accounting Unit -
Account No.Fund Description
Accounting Unit -
Account No.
Description
Amount
2022-23 13518782-69135 Community Development
Block Grant
Community Development
– Housing Payment to
Subagent
$11,000
Amendment to FY 21-22 Agreement with Habitat for Humanity for Residential
Rehabilitation Grant Program
February 7, 2023
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EXHIBIT(S)
1.Staff Report from July 6, 2021
2. First Amendment to FY 21-22 Agreement with Habitat for Humanity
Submitted By: Michael L. Garcia, Executive Director of Community Development
Approved By: Kristine Ridge, City Manager
Page 1 of 2
AMENDMENT TO AGREEMENT WITH HABITAT FOR HUMANITY
FOR USE OF COMMUNITY DEVELOPMENT BLOCK GRANT FUNDS
THIS AMENDMENT to the above-referenced agreement is entered into on February 7, 2023, by
and between Habitat for Humanity of Orange County, Inc., a California religious nonprofit
corporation (“Subrecipient”), and the City of Santa Ana, a charter city and municipal corporation
organized and existing under the Constitution and laws of the State of California (“City”).
RECITALS
A.The parties entered into Agreement No. A-2021-068-08 (“Agreement”) dated July 6, 2021,
wherein the City awarded an agreement with Habitat for Humanity for the administration
of a residential rehabilitation program (“Program”) in the amount of $545,532. The
Program is designed to improve and preserve the housing stock with federal Community
Development Block Grant (CDBG) funds. The Program provides grants of up to $25,000
to eligible homeowners that are low-income or below 80% of the Area Median Income
(AMI) as defined by the Department of Housing and Urban Development (HUD).
B.The term of the Agreement was extended on May 10, 2022 (#A-2021-068-08A) until
December 31, 2022. On January 3, 2023, the parties agreed to a further extension to the
Agreement (#A-2021-068-08B) until February 28, 2023, after Habitat for Humanity
identified several homes that had health and safety issues that included lead and mold
contamination that required remediation efforts before issuing a notice of completion and
closing the projects.
C.The parties seek to amend the Agreement to allow for an increase in the amount of funds
awarded to complete the Program.
The Parties therefore agree:
1.Section 2.a, Compensation, is hereby amended to increase the total amount of funds awarded
under this Agreement by an additional eleven thousand dollars ($11,000).
2.Except as modified by this Amendment, all terms and conditions of the Agreement, shall
remain in full force and effect.
[signature page to follow]
EXHIBIT 2
Page 2 of 2
IN WITNESS WHEREOF, the parties hereto have executed this First Amendment to the
Agreement on the date and year first written above.
ATTEST CITY OF SANTA ANA
_______________________________ ______________________________
Norma Orozco Kristine Ridge
Acting Clerk of the Council City Manager
APPROVED AS TO FORM HABITAT FOR HUMANITY
SONIA R. CARVALHO
City Attorney
By:___________________________ _______________________________
Brandon Salvatierra By:
Deputy City Attorney Title:
RECOMMENDED FOR APPROVAL
________________________________
Michael Garcia
Executive Director
Community Development Agency
EXHIBIT 2