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HomeMy WebLinkAbout2014-08-25 14-278 ORDERCOUNCIL ACTION Item No. 14-27 Date: August 25. 2014 Item/Subject: Order, Establishing Down Payment Assistance Program Responsible Department: Community and Economic Development Commentary: This order will authorize the City to use CDBG funding to develop a down payment assistance program for the following: low to moderate income (LMI) persons purchasing a home any where within the City; and to any one if the home is purchased in the Neighborhood Revitilazation Strategy Area (NRSA). If approved, the program shall provide up to $5,000 in down payment assistance for a term of five (5) years for any individual or favnily that purchases a home in the NRSA; or for individuals and families anywhere in the City at or below 80% of Area Median Income (AMI). The recipient shall sign a Promissmy `dote and Mortgage Deed (be filed at the Registry of Deeds) as security. At the end of the five (5) year period, the Mortgage Deed shall be discharged, provided, however that the individual or family continue to own the home. However, if before the end of the five (5) year period the recipient sells the property, refinance the property, change title to the property, or no longer lives In the property as their principle residence, then the entire closing cost assistance amount shall be repaid in full to the Department. Additionally, the home being purchased must be inspected by the Department's Housing Rehabilitation Coordinator based on HUD Housing Quality Standards, (HQS). Any health and safety concerns and/or Code violations discovered during Inspection shay be teed with documentation provided prior to closing. The program will be administer -ed by the Community and Economic Development Department. Tanya Emery Department Head Manager's Comments: This item was reviewed and recommended for apprnv°al by the Business & Economic Development Committee at Its August 5, 2014 meeting. 21ii ( City Manager Associated Information: Budget Approval: Legal Approval: Finance Director City Sokitor Introduced for Passage First Beading Referral Page of 14-278 AUGUST 25, 2014 Assigned to Councilor Durgin CITY OF BANGOR - - -(TITLE.) ORDER, Establishing --Down Payment Assistance Program WHEREAS, a Program to assist homeownership would sustain and promote single family home ownership in Bangor; and WHEREAS, the Program shall provide up to $5,000 in down payment assistance for individuals or families at or below 80% of Area Median Income; and WHEREAS, the term of the agreement shall be for five (5) years and a Mortgage Deed shall be filed at the Penobscot County Registry of Deeds to secure a Promissory Note. However, if before the end of the five (5) year period the recipient sells the property, no longer retains title to the property, or no longer lives in the property as their principle residence, then the entire closing cost assistance amount shall be repaid in full to the Department; and WHEREAS, the home being purchased must be inspected by the Department's Housing Rehabilitation Coordinator. Any health and safety concerns and/or Code violations discovered during inspection shall be fixed, with documentation provided prior to closing; and WHEREAS, funding for the Program will come from the City's Community Development Block Grant Program: BE IT ORDERED BY THE CITY COUNCIL OF THE CITY OF BANGOR, THAT The City Manager is hereby authorized to establish a Down Payment Assistance Program using CDBG funding. The City will develop the Program for low to moderate income (LMI) persons purchasing a home city-wide, as well as for anyone purchasing a home located in the Neighborhood Strategy Revitalization Area. IN CITY -COUNCIL AUGUST 25, 2014 MOTION MADE AND SECONDED FOR PASSAGE MOTION DOUBTED VOTE; 8-1 COUNCILORS VOTING YES: BALDACCI, BLANCHETTE, CIVIELLO, DURGIN, GRAHAM, NEALLEY, PLOURDE, SPRAGUE COUNCILORS VOTING NO: GALLANT PASSV-/ Q CITY CLrRK