Report to Mayor and City Council
Tuesday, July 16, 2019
Consent
SUBJECT:
Title
CONSIDER APPROVAL OF A CONTRACT SERVICES AGREEMENT WITH MDG ASSOCIATES, INC. TO PROVIDE GRANT-FUNDED REHABILITATION INSPECTION SERVICES AND APPRAISAL EVALUATION SERVICES FOR THE HOME INVESTMENT PARTNERSHIP (HOME) GRANT PROGRAM (CITY COUNCIL)
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I. SUMMARY
The City of Carson applied for and was granted $500,000 in California Department of Housing and Community Development’s HOME grant funds (Exhibit No. 1). These funds may be used to rehabilitate homes for low income families. In order to take advantage of this program, specialized services such as appraisals and inspections are necessary. These are services City staff is unable to provide, typically regardless of the city. The City issued an RFP and MDG Associates, Inc. (MDG) was the proposer to propose on these services. In addition to and unrelated to the proposed contract, MDG has a separate contract with the City to provide various services related to the CDBG program. However, it is necessary to have this additional contract since the services for the HOME Program must be paid by the HOME program, not CDBG. Therefore, staff is recommending that Council approve the agreement with MDG to provide services necessary to implement the HOME grant program. (Exhibit No. 5)
II. RECOMMENDATION
Recommendation
TAKE the following actions:
1. APPROVE the contract services agreement with MDG Associates, Inc. to provide grant-funded rehabilitation inspection services and appraisal evaluation services for the HOME grant program.
2. AUTHORIZE the Mayor to execute the agreement, following approval as to form by the City Attorney.
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III. ALTERNATIVES
TAKE any other action the City Council deems appropriate that is consistent with the requirements of law.
IV. BACKGROUND
In 2016 the City of Carson applied to the California Department of Housing and Community Development (HCD) for a HOME Investment Partnerships (HOME) grant that would assist approximately nine single-family homeowners to rehabilitate their home at a maximum of $65,000 per unit, provided that the homeowners meet the income eligibility requirements and certain other criteria. On July 13, 2017 HCD awarded the City $500,000 in HOME funding for an Owner-Occupied Rehabilitation (OOR) Program. Funding of $487,500 is allocated for the OOR Program and $12,500 is allocated for program City staff administration costs (Exhibit No. 1). City guidelines further limit the funding for each single-family home to $50,000. The three-year agreement between the City and HCD ends on July 31, 2020 (Exhibit No. 2).
The City uses HOME funds to supplement the CDBG-funded Neighborhood Pride Program (NPP), which provides grants for smaller projects, generally up to $25,000 for work done on a home, to benefit low-income homeowners throughout the City. The HOME program is different from the NPP in that HOME can set higher limits for homes in need of greater repair but is limited to homes under the maximum after-rehabilitation value of $517,000, so it is not available in parts of the city where the home values are higher.
As part of the requirements of the program in determining home values, appraisals are necessary to estimate the home’s existing value and the after-rehabilitation value (the value of the home after improvements are complete) to ensure that the after-rehabilitation value is within program guidelines. Home inspections are also necessary to determine the extent of repairs and to estimate the cost of completing the repairs, also to ensure that the cost of repairs is within program guidelines. As home inspections and home appraisals are specialized services outside of the duties, responsibilities and experience of City staff, it is necessary to retain a qualified and experienced provider of those specialized services to administer those requirements of the program.
MDG Associates, Inc. (MDG) has been providing high quality community development consulting services to municipal agencies for over 28 years. MDG specializes in providing grant management services with an emphasis on HUD funded programs. In addition to grant management services, MDG also provides administration and implementation services of residential and commercial rehabilitation services, labor compliance monitoring and project management services. MDG’s consulting team possesses expertise in all aspects of HOME program administration and implementation. MDG has proven to be a professional and well-qualified asset in implementing grant programs. Staff recommends that Council approve the agreement with MDG to provide rehabilitation inspection services and appraisal evaluation services in support of the HOME grant program.
V. FISCAL IMPACT
This maximum of contract amount of $27,550 will be paid by the HOME Program funds. Funds for these services are included in the FY 2019/20 budget in account number 214-70-720-964-6004.
VI. EXHIBITS
1. HCD Award Announcement (pgs. 4-6)
2. State of California HCD Standard Approval Agreement (pgs. 7- 37)
3. HCD -Approval of Contract General Set-up Conditions (pgs. 38-42)
4. HCD Authority to Use Grant funds for HOME program. (pgs. 43-45)
5. Draft MDG HOME agreement. (pgs.46-72)
Prepared by: Brent Gesch, Principal Adminstative Analyst