Agenda Item # 1

Columbus Consolidated Government
Council Meeting

03/26/2013
Agenda Report # 45


TO: Mayor and Council

SUBJECT: Memorandum of Understanding - Neighborworks Columbus
for "Downpayment Assistance Partner Program"

INITIATED BY: Amy Carbajal, Community Reinvestment Department


Recommendation: Approval is requested to execute a Memorandum of Understanding with Columbus Housing Initiative, Inc., D/B/A Neighborworks Columbus to initiate the Downpayment Assistance Partner Program.

Background: The city of Columbus has recently seen significant reductions in HUD Entitlement funds which are used to provide downpayment assistance to first time, income qualified home buyers. As a result of these funding reductions, the downpayment assistance program exhausted all funds for the current fiscal year. Neighborworks Columbus, through a Financial Allocation from the Community Development Financial Institution Fund (CDFI), has allocated $150,000 to the City's downpayment assistance program to provide funds for downpayment assistance to finish the fiscal year. In an effort to ensure that low income households are afforded the opportunity to purchase a home and the City's real estate market does not suffer any further hardships, Neighborworks and the City of Columbus will enter into a Memorandum of Understanding to establish the Downpayment Assistance Partner Program.

This program will offer up to $10,000 in downpayment assistance to low income households in Columbus. The Community Reinvestment Department will underwrite the loan for a small fee. Once the loan is closed, it will transfer to Neighborworks for the term of the loan. This provides a small revenue source for the Department and continues a valuable program in the City.

Analysis: This is in the best interest of the City for economic reasons. It is also in the best interest of the City's low income population.

Financial Considerations: This provides a small revenue stream for the program and processing time and efforts will be equivalent to the City's HUD Downpayment Assistance program.

Projected Annual Fiscal Impact Statement: This will have a positive impact on the Community Reinvestment Department budget.

Legal Considerations: The city will have no responsibility to service the loan once it is issued. It will be transferred back to Neighborworks Columbus. The City is only underwriting the Downpayment Assistance Loan on behalf of Neighborworks.

Recommendations/ Actions: Authorize the City Manager to execute the Memorandum of Understanding Between the Consolidated Government of Columbus, Georgia and Columbus Housing Initiative, Inc. D/B/A Neighborworks Columbus to initiate the Downpayment Assistance Partner Program.




A RESOLUTION

NO. _____


A RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE A MEMORANDUM OF UNDERSTANDING WITH COLUMBUS HOUSING INITIATIVE D/B/A NEIGHBORWORKS COLUMBUS TO INITIATE THE DOWNPAYMENT ASSISTANCE PARTNER PROGRAM.

WHEREAS, the City has extensive knowledge, skill and experience in implementing and developing single family down payment assistance programs (DPA) in Columbus for families at or below 80% Muscogee County Metropolitan Statistical Area median income level (“AMI”); and,

WHEREAS, NeighborWorks Columbus has applied for and received a Financial Allocation from The Community Development Financial Institution Fund (the “CDFI Fund”) of the United States Treasury, that can be used for single family DPA programs for families at or below 80% AMI; and,

WHEREAS, to facilitate the City’s administration of the City’s DPA Program, NeighborWorks Columbus will fund a pool of money (the “Funding Pool”) to the City and the City will use the Funding Pool to make second loans to qualifying homebuyers under the guidelines of the City’s DPA Program and subsequently assign the DPA Loans to NeighborWorks Columbus within 30 days after closing the DPA Loans as set forth in the Memorandum Of Understanding.

NOW, THEREFORE, THE COUNCIL OF COLUMBUS, GEORGIA, HEREBY RESOLVES AS FOLLOWS:

That the City Manager is hereby authorized to execute a Memorandum of Understanding with NeighborWorks Columbus as outlined in the attached Memorandum of Understanding.


___________

Introduced at a regular meeting of the Council of Columbus, Georgia, held the _________ day of _____________ 2013, and adopted at said meeting by the affirmative vote of
_____________ members of said Council.


Councilor Allen voting __________.
Councilor Baker voting __________.
Councilor Barnes voting __________.
Councilor Davis voting __________.
Councilor Henderson voting __________.
Councilor Huff voting __________.
Councilor McDaniel voting __________.
Councilor Turner Pugh voting __________.
Councilor Thomas voting __________.
Councilor Woodson voting __________.

__________________________ ______________________
Tiny B. Washington, Clerk of Council Teresa Pike Tomlinson, Mayor