A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, AUTHORIZING THE CITY MANAGER TO PERFORM THE FOLLOWING ACTIONS: (1) TO RECAPTURE $220,000 OF FY 20 HOME INVESTMENT PARTNERSHIP (HOME) FUNDS PREVIOUSLY ALLOCATED TO TENANT BASED RENTAL ASSISTANCE, AND TO REALLOCATE SAID FUNDS TO THE HOME OWNERSHIP ASSISTANCE PROGRAM IN ORDER TO ENSURE COMPLIANCE WITH HUD EXPENDITURE DEADLINES; (2) TO ALLOCATE THE FY 21 STATE HOUSING INITIATIVES PARTNERSHIP (SHIP) FUNDS IN THE AMOUNT OF $394,363, AS FOLLOWS: (A) TO THE NEPTUNE APARTMENTS REHABILITATION PROJECT IN THE AMOUNT OF $200,000; (B) TO THE FIRST TIME HOMEBUYER PROGRAM AND HOMEOWNER REHABILITATION PROGRAM IN THE AMOUNT OF $154,927; AND (C) FOR ADMINISTRATIVE COSTS, IN THE AMOUNT OF $39,436; AND (3) TO SUBMIT THE REVISED ACTION PLANS TO U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD); AND FURTHER AUTHORIZING THE CITY MANAGER AND CITY CLERK TO EXECUTE ANY AGREEMENTS OR RELATED DOCUMENTS WITH RESPECT TO THE FOREGOING, INCLUDING AGREEMENTS TO BE SIGNED BY SUB-RECIPIENTS.

HOME Funds

As an entitlement community, the City automatically qualifies for an annual allocation of federal funding under US Department of Housing and Urban Development (HUD) grant programs.  HUD requires each entitlement community to submit an annual One-Year Action Plan describing how it will utilize funding and resources to address priority needs identified in the City’s Consolidated Plan. The One-Year Action Plan is a component of the Five-Year Consolidated Plan filed with HUD. The Administration reviews allocations on an ongoing basis and recommends recapture and reallocation of funds to meet expenditure deadlines.  

On May 13, 2020, the Mayor and City Commission approved the FY 20 Action Plan via Resolution No. 2020-31257, which authorized the allocation of: $220,000 for Tenant-Based Rental Assistance The funding allocation was designated to help ameliorate financial hardship experienced by low-income residents affected by COVID-19. This action was made possible in part because HUD extended several  waivers to September 30, 2021for HOME programs implemented as a response to the COVID-19 pandemic As of June 30, 2021, many of the households applying to the City for rent and utility assistance do not fulfill the federal requirements for US residency and/or 60% Area Median Income, which has impeded the City’s ability to expend funds in a timely manner. As such, the Administration is recommending the reallocation of these funds to the First-time Homebuyer Program as there are currently 37 households on the City’s waitlist enabling the City to add additional units to its affordable housing stock while ensuring the timely expenditure of funds in compliance with HUD regulations.

On April 8, 2021, HUD announced the American Rescue Plan (ARP), which will provide $5 billion to Participating Jurisdictions--  including the City -- through the HOME-ARP Program. The estimated allocation for the City is $2,245,387  and can be utilized for the following four eligible activities:

• Production or Preservation of Affordable Housing

• Tenant-Based Rental Assistance (TBRA)

• Supportive Services, Homeless Prevention Services, and Housing Counseling

• Purchase and Development of Non-Congregate Shelter

  The release date of ARP funds has yet to be determined by HUD.  Funds must be expended by 2030. These funds, which are the equivalent to more than four annual HOME allocations, can allow the City to continue its rent assistance efforts for those impacted by COVID while also allowing expanded assistance under the City’s First-time Homebuyer Program.

     

  SHIP Funds

The State Housing Initiatives Partnership Program (SHIP), administered through the Florida Housing Finance Corporation (Florida Housing), was established in 1992 by the William E. Sadowski Affordable Housing Act to stimulate the production of affordable housing statewide. SHIP Program funds are derived from documentary stamp levies on real estate transactions and held in the SHIP Program Trust Fund. Annually, Florida Housing allocates SHIP program funds among participating jurisdictions on a formula basis by June 30.  Since 2016, the City has allocated SHIP funds to Homeowner and Homebuyer assistance. Assistance is provided in the form of a forgivable loan with deferred payments as long as the recipient complies with program requirements. The loan is forgiven if recipients do not rent, sell or refinance the purchased unit during the 15-year affordability period.

On June 30, 2020, Florida Housing announced that annual SHIP funding allocations would not be dispersed as the Florida Legislature has programmed Sadowski Act funds in other areas.  Instead, the state, which was awarded Coronavirus Relief Funds through the U.S. Treasury Department, would utilize federal funds to distribute to entitlement communities.

From March 1 to December 30, 2020, the City assisted eight (8) households with down payment and mandated rehabilitation assistance. The loss of the annual SHIP allocation in 2020 resulted in the creation of a waitlist for the first time since the commencement of the First-time Homebuyer and Homeowner Programs in 2016.

On June 10, 2021, Florida Housing announced the City’s projected SHIP allocation as $394,363. Funds will become available after October 2021 and will be disbursed in multiple payments over the course of several months. The Administration has identified a City-owned property with a funding gap in its rehabilitation which is also an eligible property for SHIP funds.

 Neptune Apartments

The Neptune Apartments, located at 1632 Meridian Avenue, provides a total of 35 efficiency units in a single, 3-story historic building. In 2015, HOME Program funds were used to fund the acquisition of the property then owned by Miami Beach Community Development Corporation. As such, no additional HOME funds can be used at this property until the affordability period is met in 2045.

The Neptune Apartments were acquired with significant deficiencies that were the product of poor workmanship and materials by the prior owner. The City has undertaken a variety of repairs to this property including the installations of shower pans in each unit and the completion of Phase 1 of renovations that included a new roof, stucco repair and floor repairs. The property’s needs were divided into two phases in order to maximize available funds and undertake repairs as quickly as possible.

Phase 2 of the renovation will weatherproof the façade and envelope, eliminate water and moisture intrusion, as well as other structural enhancements that will improve the building’s resiliency. Ultimately, the historic rehabilitation project ensures decent, safe and sanitary conditions for at least an additional 30 years.

The City has applied for and received a grant from the Federal Emergency Management Agency (FEMA) for $140,596,04 for the rehabilitation of the Neptune Apartments. The City is leveraging the federal funds used in Phase 1 to comply with match requirements. However, a $200,000 funding gap remains for Phase 2 that cannot be met with federal fund funds. As such, the Administration recommends using SHIP funds to close this gap and ensure compliance with SHIP regulations:

The FEMA and SHIP funding allocations outlined are contingent upon funding availability and disbursement. As such, the City is prepared to utilize Residential Replacement Reserves to fund the project until FEMA funds are available as the City must meet the CDBG expenditure deadline of July 2022. In order to do this, an Invitation to Bid must be submitted to the Procurement Department within the next thirty (30) days and construction would need to begin in November 2021We cannot proceed with Phase 2 until all needed project funds have been identified and allocated.

First-Time Homebuyer and Homeowner Assistance Programs

The City has been providing emergency rent, mortgage and utility assistance for eligible residents financially impacted by COVID-19. The City has used a variety of federal, state and local funds to assist 526 households with $1,398,577.21 in as of June 30, 2021. The households assisted through these funds must be earning no more than 80 percent Area Median Income (AMI) for Community Development Block Grant (CDBG-CV3) programs, 60 percent AMI for the HOME Investment Partnership programs and 120 percent AMI for General Fund assistance. The City continues to use an online portal to schedule appointments. The pace of requests has been consistently declining- from 153 households in January to only 54 households in June.

The following funds remain available for rent, mortgage and utility assistance:

While rent and utility assistance demand has decreased significantly, the demand for the City’s homebuyer and homeowner assistance programs have increased significantly during the pandemic.

The Office of Housing and Community Services (HCS) was recreated to create a waitlist for its First Time Homebuyer Program to ensure compliance with SHIP statute 3420.9075 as several eligible households were pending assistance funds. Furthermore, the waitlist has enabled the City to identify eligible households to comply with the 20% Special Needs set-aside requirement, as defined in 420.0004 Florida Statutes.

Below is a snapshot of the current applicant waitlist:

The Office of Housing and Community Services is working collaboratively with the Human Resources Department on a campaign to inform employees about available resources for homeownership. These efforts seek to increase the number of employees who live, work and play in our community.

The 2019 Analysis of Impediments to Fair Housing Choice (AI) identifies the City’s challenges in promoting affordable and fair housing, and highlights opportunities that can set goals and priorities to address said challenges. The AI states the homeownership rate in Miami Beach is 37.4% lower than the national average of 63.9%. One of the goals and objectives listed in the City’s 2017-2022 Consolidated Plan is: to increase and maintain homeownership assistance to promote community investment and stable housing for all.  

Given that the City has had difficulty identifying households eligible within the federal guidelines and the upcoming expenditure deadline for these funds, the Administration recommends recapturing HOME funds originally appropriated for rent assistance and reallocate these funds to serve households enrolled in the waitlist for first time homebuyer and homeowner rehabilitation assistance programs. Below is a summary of funds being harnessed for this purpose and the net impact of each:

Below is recommendation of the FY 21 SHIP funds that will be allocated to the City:

N/A

180-0530-000346-23-404-534-00-00-00-53419

152-0530-000349-00-404-534-00-00-00-57210

The Administration recommends the following actions: 1) recapture of $220,000 FY 20 HOME Investment Partnership (HOME) Program funds previously allocated to Tenant-Based Rental Assistance and reallocation to the Homeownership Assistance Program;  2) to allocate the FY 21 State Housing Initiative Partnership (SHIP) Program Funds in the amount of $394,363: (i) to the Neptune Apartments rehabilitation project in the amount of $200,000; (ii) to the Homebuyer and Homeowner Rehabilitation Programs in the amounts of $154,927; (iii) and administrative costs in the amount of $39,436; and  (3) submit the revised FY 20 Action Plan to HUD and further authorize the City Manager and City Clerk to execute City Interdepartmental Agreements and other agreements to be signed by Sub-recipients.