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HomeMy WebLinkAbout95-143 Resolution No. 95-143 RESOLUTION AUTHORIZING EXECUTION OF A PURCHASE OF SERVICE AGREEMENT WITH NEIGHBORHOOD HOUSING SERVICES BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN, ILLINOIS, that Richard B. Helwig, City Manager, and Dolonna Mecum, City Clerk, be and are hereby authorized and directed to execute a purchase of service agreement on behalf of the City of Elgin with Neighborhood Housing Services to provide property conversion to certain areas within the city limits, a copy of which is attached hereto and made a part hereof by reference. s/ Kevin Kelly Kevin Kelly, Mayor Presented: June 28, 1995 Adopted: June 28, 1995 Omnibus Vote: Yeas 7 Nays 0 Attest: s/ Dolonna Mecum Dolonna Mecum, City Clerk PURCHASE OF SERVICE AGREEMENT BETWEEN NEIGHBORHOOD HOUSING SERVICES OF ELGIN, INC. AND THE CITY OF ELGIN THIS AGREEMENT is made and entered into this /( 4:, day of *SUL , 1995, by and between the City of Elgin, Illinois, an Ill nois municipal corporation, (hereinafter referred to as "City" ) and Neighborhood Housing Services of Elgin, Inc. , an Illinois not-for-profit corporation (hereinafter referred to as "NHS" ) ; and WHEREAS, City has determined that it is in the best interests of City and its citizens to promote and facilitate the conversion of lawful nonconforming multifamily residential properties to single family use; and WHEREAS, NHS has successfully provided redevelopment services and administration in the Elgin, Illinois area and is familiar with and otherwise experienced in the historical, geographic and architectural attributes of the City of Elgin and surrounding area. NOW, THEREFORE, for and in consideration of the mutual promises and covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows: 1 . On or before July 17, 1995, City shall pay to NHS the sum of One Hundred Thousand Dollars ($100,000 . 00) . 2 . NHS shall directly and solely utilize the aforementioned $100,000 as and for direct payments to property owners of lawful nonconforming residential conversion properties located within the corporate boundaries of the City of Elgin, Illinois, pursuant to the terms and conditions provided herein. 3 . The terms, conditions and criteria by which recipients of the aforementioned payments to property owners shall be selected and governed shall be pursuant to the terms of the Multifamily Conversion Program, which is attached hereto and made a part hereof as Exhibit "A" . City may amend the terms and provisions of the Multifamily Conversion Program from time to time in its sole discretion by providing written notice of such amendments to NHS. 4 . NHS shall hold harmless and indemnify City from and against any and all claims for damages, lawsuits, causes of action or any and all other liability which may arise out of or in connection with NHS' negligent performance of the terms of this agreement, specifically including, but not limited to, failure to adhere to the provisions of the Multifamily Conversion Program. 5 . This agreement shall be effective July 1, 1995 and shall terminate July 15, 1996 unless otherwise terminated as provided herein. 6 . This agreement may be terminated by City upon fifteen ( 15) days written notice to NHS for any reason. 7 . Upon termination of this agreement, NHS shall return any funds provided by City pursuant to this agreement, which have not been expended directly to property owners pursuant to this agreement, to City within thirty ( 30) days of termination. NHS shall not expend any funds acquired from City pursuant to this agreement upon receiving notice of termination. 8 . NHS shall provide a detailed written report of all expenditures of funds made pursuant to this agreement to City after July 1, 1996, and before July 15, 1996, which report shall include but not be limited to properties converted, amounts paid and selection criteria used. 9 . The terms and provisions of this agreement shall be severable. In the event that any portion of this agreement is deemed to be void or otherwise unenforceable for any reason, the remainder of this agreement shall remain in full force and effect. 10 . This agreement shall be subject to and governed by the laws of the State of Illinois . 11 . This agreement represents the entire agreement between the parties hereto. No other oral or written agreements currently exist which shall modify or supersede the terms of this agreement. CITY OF ELGIN By Richard B. Helwig City Manager Attest: Dolonna Mecum City Clerk NEIGHBORHOOD HOUSING SERVICES OF 'ir GI 1 I ./ , By B macl ' g=1 Rosent . :o.. d President -2- EXHIBIT A MULTIFAMILY CONVERSION PROGRAM 1 . "Lawful Nonconforming Residential Conversion" shall mean a residential structure to which additional dwelling units were constructed consistent with the provisions of the then applicable zoning ordinance. 2 . Program shall operate under established objective criteria with respect to selection of participating properties . 3 . Program expenditures shall be limited to construction items required to convert a residential structure to single family residential use. 4 . All work performed under program shall be performed in compliance with all applicable city codes and ordinances specifically including but not limited to approved final inspection. 5 . Program shall provide a maximum of $12, 000 in financial assistance per dwelling unit. 6 . All recipients of funds pursuant to this Multifamily Conversion Program shall be required by NHS to enter into an agreement which shall specifically require that such recipient shall not participate, either directly or indirectly in the Elgin Residential Rehabilitation Grant Program or any other federally funded housing rehabilitation program, and shall not sell or otherwise convey their interest in the subject property prior to completion of their participation in the Multifamily Conversion Program. Such agreement shall further require compliance with all other provisions of the Multifamily Conversion Program, and shall provide that such recipient shall indemnify, reimburse and hold harmless the City of Elgin, Illinois from and against any claims for damages, causes of action, lawsuits, and any and all other liability which may arise out of or in connection with said recipient ' s breach of the terms of the aforementioned agreement or other negligent or reckless acts . -3- • Agenda Item No. �. , err May 12, 1995 TO: Mayor and Members of City Council FROM: Richard B. Helwig, City Manager SUBJECT: Multi-Family Housing Conversion Program PURPOSE The purpose of this memorandum is to provide background infor- mation to the Mayor and members of the City Council for the implementation of a multi-family housing conversion program. BACKGROUND Throughout discussions with elected officials, neighborhood groups, real estate professionals, and staff on improving the quality of life in Elgin's inner-ring, one problem has been identified time and again -- overcrowded housing. The nega- tive impact on neighborhoods is evidenced by too many cars on the street, housing stock showing signs of distress, building exteriors with cut-up facades and added entries, and estab- lished schools facing increased populations despite service areas without additional structures . Overcrowded housing can often be unsafe housing for occu- pants . Conditions provide an environment for neighborhood disputes and possible violence. The current conditions re- sult from a time in American cities when it was common prac- tice to allow conversion of single-family residences to multi-family uses . Under current zoning ordinances, such conversions are not permitted. However, properties remain throughout the city as lawful nonconforming conversions . Most obvious are traditional single-family structures with multi-family uses . Large suburban cities such as Elgin are making a priority of downsizing housing uses . Aurora has increased its funding for a successful conversion program from $570,000 to $1,000,000 in 1995. City departments contin- ue to attack unlawful conversions, now with riverboat pro- ceeds programmed over the next five years, lawful nonconform- ing structures can be downsized. Multi-family Housing Conversion Program May 12 , 1995 Page 2 The proposal before the City Council is for Neighborhood Housing Services of Elgin to administer the multi-family conversion program. NHS has a proven track record as a part- ner redevelopment agency. Although NHS has been focused to this point on specific target areas in the City, the new conversion program will be available for strategic properties city-wide. The essential specifics of the program are: • Properties must be lawful nonconforming structures . The property must be brought to a single-family use. • The program will provide funding for reconversions in the form of a three-year forgivable loan for construc- tion costs related to the funding. Expenses related to the conversion may include items such as : * removal of electrical meter and rewiring * removal of kitchens * removal of exterior stairwells and exits * installatior, of siding, windows, etc. * elimination of some off-street parking * other construction-related items as approved • The three-year note would be forgiven at a rate of 33% per year. The loan would become due and payable immedi- ately for violation of program guidelines (sale or trans- fer of property within three years, substantial and/or continued noncompliance with property maintenance codes ) . ▪ All work requires approved building permits . • Maximum $12 , 000 loan per structure. • $150 non-refundable application fee to NHS . • Properties will be selected by NHS Loan Committee based upon available funding and in consultation with neighbor- hood groups based upon properties that will have the highest positive impact from their conversion. The program will be operated through NHS for one-year and then evaluated. COMMUNITY GROUPS/INTERESTED PERSONS CONTACTED None. FINANCIAL IMPACT The 1995 Budget includes $100,000 for the multi-family conver- '" sion program (Acct. #275-0000-791 .92-32, Project 157200) . Each subsequent year in the Five-Year Financial Plan shows in- creased support for this effort, totalling $1 .2 million dur- ing 1995-1999 . Multi-family Housing Conversion Program May 12 , 1995 Page 3 rak LEGAL IMPACT None. RECOMMENDATION It is recommended that the City Council request that staff develop the necessary agreement with Neighborhood Housing Services to administer the multi-family housing conversion program. Respectfully submitted, L;. ;)VCI"ay A. Pearson B;iet/Publ ' 6-Information Officer Roger K. Dahlstrom Planning Director f Richard B. Helwig City Manager RBH/CJP/sg