AGENDA #4i
MEMORANDUM
TO: Mayor and Town Council
FROM: W. Calvin Horton, Town Manager
SUBJECT: Recommended Guidelines for a Comprehensive Rehabilitation Program for the Northside Neighborhood
DATE: April 14, 2004
The purpose of this memorandum is to recommend guidelines for a Comprehensive Rehabilitation program for the Northside neighborhood (please see Attachment 1). On April 28, 2003, the Council approved use of $150,000 of 2003-2004 Community Development Block Grant funds for this activity.
The attached resolution would adopt guidelines for a comprehensive rehabilitation program for the Northside neighborhood. If approved, the Town would enter into a Performance Agreement with Orange County to administer the program.
BACKGROUND
In response to a request from the Northside Community Association on April 28, 2003, the Council approved use of $150,000 of 2003-2004 Community Development Block Grant funds for a comprehensive rehabilitation program for the Northside neighborhood. At that time, we estimated that these funds would rehabilitate a minimum of four houses and provide for contract staff support. We also recommended that we contract with Orange County Department of Housing and Community Development to oversee the rehabilitation work. Town staff would be responsible for the administrative portion of the program (i.e. qualifying households).
At that time we also suggested that as with the Comprehensive Rehabilitation program funded through the HOME Program, funds could be provided as deferred loans to qualified homeowners that could be forgiven over time. The funds would be repaid to the Town if a home was sold or conveyed to heirs who would not meet the income guidelines of the program within the affordability period.
We further suggested that we meet with representatives from the Northside Community Association to develop the criteria for eligibility for the program and a method for prioritizing applicants, and present a recommendation to the Council.
DISCUSSION
We have worked with Ms. Delores Bailey, Co-Director of EmPOWERment and representative to the Northside Community Association, and Ms. Tara Fikes, Director of Orange County Housing and Community Development to develop guidelines for a comprehensive rehabilitation program. We have determined that it would be reasonable to use the same program guidelines used for the comprehensive rehabilitation program funded by the Orange County HOME Consortium through the HOME Program.
We recommend the following key guidelines:
1. Description of Program
The Comprehensive Rehabilitation Program would provide for a deferred rehabilitation loan to owner occupants in the Northside neighborhood. The deferred repayment would be due upon transfer of ownership or occupancy with no installments, term or interest until such transfer.
2. General Terms
· The loan will be secured by a Promissory Note and Deed of Trust.
· The Loan may be in 1st, 2nd or 3rd lien position at the discretion of the Town.
· The Borrower may pre-pay either part or the entire loan at any time with no penalty charged for such repayment.
· The owner is required to keep the taxes current, the property free from further liens and encumbrances superior to the lien of the Deed of Trust and premises insured at all times during the term of the loan.
· The applicant must execute a contract for rehabilitation along with all other documents pertinent to the loan that the Town may require (please see Attachment 2 for a sample Contract for Rehabilitation Work).
3. Forgiveness of Loan
We recommend that the deferred loan be forgiven based on the amount of the loan as follows:
· If a loan is less than $15,000, the loan term would be 5 years. The loan would be forgiven 20% per year for each full year of occupancy.
· If a loan is between $15,000 and $25,000, the loan term would be 10 years. The loan would be forgiven 10% per year for each full year of occupancy.
· If a loan is greater than $25,000 the loan term would be 15 years. The loan would be forgiven 6.66% per year for each full year of occupancy.
4. Eligibility Criteria
To be eligible for a deferred loan through the Comprehensive Rehabilitation Program, we propose that the applicant would have to meet the following criteria:
· The property must be residential and located in the Northside neighborhood.
5. Rehabilitation Cost
We recommend that the following costs be eligible under the proposed program:
· The cost to correct code violations;
· The cost to correct incipient violations;
· The cost of building permits and related fees required to carry out the rehabilitation work, including but not limited to, architect and engineering fees;
· The cost of changing a permitted non-conforming use to meet the requirement of the Town code;
· The cost of retrofitting existing spaces so that they are handicapped accessible;
· The cost of effective energy efficient improvements.
We also recommend that funds also be used for legal costs associated with the loan including closing costs, document preparation, and title searches.
A complete list of recommended guidelines for the program is included in Attachment 1.
Administration of Program
As reported to the Council on April 28, 2003, we plan to contract with Orange County to manage the rehabilitation work on the properties. Orange County currently operates a housing rehabilitation program and has the staff in place to do so. The Town does not currently have a rehabilitation specialist on staff to supervise such projects.
The Orange County staff would inspect properties and work with the Town’s Inspection Department to identify all code violations, complete a work write-up (incorporating Town Code violations) and cost estimate, and facilitate the bid process (i.e. selecting and hiring a contractor) according to the federal procurement procedures.
We propose to pay Orange County approximately 6% of the total rehabilitation cost of the house for managing the rehabilitation work on the properties. Use of Community Development funds for this expense would be eligible under the federal regulations.
If the program guidelines were adopted as recommended, Community Development staff would be responsible for working with the Northside Neighborhood Association to identify properties for rehabilitation, working with the owners to complete the program application, and determining program eligibility.
MANAGER’S RECOMMENDATION
We recommend that the Council adopt the attached resolution to establish guidelines for a Comprehensive Rehabilitation Program for the Northside neighborhood. We also recommend that the Council authorize Orange County to approve bids on the Town’s behalf for eligible properties in accordance with the guidelines discussed in Attachment 1.
ATTACHMENTS
1. Recommended Guidelines for a Comprehensive Rehabilitation Program for the Northside Neighborhood (p. 6).
2. Sample Contract for Rehabilitation Work (p. 16).
A RESOLUTION ADOPTING GUIDELINES FOR A COMPREHENSIVE REHABILITATION PROGRAM FOR THE NORTHSIDE NEIGHBORHOOD (2004-04-14/R-9)
WHEREAS, on April 24, 2003, the Council budgeted $150,000 of 2003-2004 Community Development funds for a comprehensive rehabilitation program for owner-occupied homes in the Northside neighborhood;
NOW, THEREFORE, BE IT RESOLVED that the Council of the Town of Chapel Hill adopts guidelines for a comprehensive rehabilitation program as described in Attachment 1 to the memorandum presented to the Council at its April 14, 2004 Council meeting.
BE IT FURTHER RESOLVED that the Council authorizes Orange County to approve bids on the Town’s behalf for eligible properties in accordance with Comprehensive Rehabilitation Program guidelines.
This the 14th day of April, 2004.
DRAFT
TOWN OF CHAPEL HILL GUIDELINES FOR A COMPREHENSIVE REHABILITATION PROGRAM
FOR THE NORTHSIDE NEIGHBORHOOD
INTRODUCTION
The Town of Chapel Hill, in response to the need for housing that is decent, safe, and affordable to low-income families, and recognizing the benefit to the community of the efficient utilization of existing housing resources, provides this program for the rehabilitation and conservation of existing owner-occupied housing.
The purpose of this rehabilitation program is to provide technical and financial assistance to owners of existing housing in order to meet the following objectives:
q To cause the improvement of housing conditions for low and moderate income families;
q To increase the supply of affordable, decent, safe, and sanitary housing; and
q To encourage the revitalization of the Northside neighborhood.
These guidelines set forth the scope of services and limits of assistance to be provided under the Comprehensive Rehabilitation Program; the criteria for eligibility and qualification of applicants for assistance; and the policies and procedures for Applicants, Contractors and the administration of the Rehab Program.
I. DEFINITIONS
A. General
1. Approved by the Town and approval by the Town- These terms mean the Town gives its consent to but does not represent, warrant or guarantee acceptability for any other purpose.
2. Contract for Rehabilitation Loan - The written agreement between the Town and the applicant which sets forth the terms and conditions of the rehabilitation loan.
3. Work Write-Up - The item-by-item description of the rehabilitation work.
4. Rehabilitation Work Contract - The written agreement between the Owner and the Contractor that sets forth the scope of the work, the compensation and time for performance.
B. Agencies
1. Federal - pertaining to the government of the United States of America and its interests.
2. State - pertaining to the government of the State of North Carolina and its interests.
3. Local - pertaining to the government of the Town and its interests.
5. HUD. Dept, of - The United States Department of Housing and Urban Development which administers Federal programs for housing and community development.
4. NCHFA - North Carolina Housing Finance Agency which administers State programs offering assistance for the development, construction and rehabilitation of low/moderate income housing including the Urgent Repair Program (URP).
C. Applicants
1. Owner-Occupant - the Title Holder to a residential structure whose primary living unit is located in the structure.
2. Investor-Owner - the Title Holder to a residential structure who does not live in the structure.
1. Annual Income - the gross amount received annually from all sources by every person residing in the dwelling, including wages, pension, Social Security, interest, rent, dividends, etc.
2. Adjusted Income - annual income less the following allowances:
a. for each family member under 18, disabled or, full-time student,
b. for any elderly family (over age 80);
c. medical expenses in excess of 3% of annual income.
d. child-care expenses to enable a family member to be gainfully employed or to further his or her education;
e. disability expense.
3. Median Income - the median income based on family size for the Durham MSA as determined by the U. S. Department of Housing and Urban Development.
4. Low Income - the annual income is below 50% of median income.
5. Moderate Income - the annual income is above 50% but does not exceed 80% of median income.
5. Income Limits - the maximum amounts that can be received as annual income to qualify for a specific assistance category, based on family size (those actually living at the property) and the median income.
1. CDBG - Community Development Block Grant Program (authorized under Title I of the Housing and Community Development Act of 1974) provides federal funds to localities for eligible community development activities.
2. HOME – A Federal program created under Title 11 (Home Investment Partnerships Act) of the National Affordable Housing Act of 1990 to provide funds to expand the supply of decent, affordable housing.
F. Properties
1. Residential - A property used only for dwelling purposes, not commercial or office use.
2. Dwelling Unit - An independent living unit containing, at a minimum, a bathroom, kitchen or kitchenette, and a living area/bedroom.
3. Single-Family Dwelling - A property containing one dwelling unit.
4. Multi-Family - A structure containing two (2) or more dwelling units.
5. Commercial - A structure used exclusively for business, storage or staging commercial activity.
6. Mixed Use - A structure containing both commercial and residential space.
1. Town Code - The Housing Code and/or Building Code enforced by the Town of Chapel Hill.
2. Code Violation - A physical condition of property that is not permitted by the Town Code.
3. Incipient Violation - A physical condition of property which, if not repaired would deteriorate into an actual code violation within two (2) years.
4. General Property Improvements - An improvement to property which is not required to meet Rehabilitation Standards but is considered normal and customary but not luxurious.
5. Rehabilitation Standards - The requirements which properties must meet or exceed after rehabilitation which include: Town Code, Federal, State, and Local laws and regulations (including Neighborhood Conservation District Guidelines and provisions of the Town’s Land Use Management Ordinance), Section 8 Housing Quality Standards, the Town’s Housing Rehabilitation Standards, and if applicable, any Historic District Guidelines.
II. COMPREHENSIVE REHABILITATION PROGRAM REQUIREMENTS
A. Description Of Program
The Comprehensive Rehabilitation Program would provide for a deferred rehabilitation loan to owner occupants in the Northside neighborhood. The deferred repayment is due upon transfer of ownership or occupancy with no installments or interest until such transfer.
B. General Terms
1. The applicant shall pay for all expenses, fees and costs (i.e. appraisal, survey, inspection, wood destroying pest inspection and treatments, origination fee, legal and recording expenses, fees and costs) in connection with the loan. These costs may be included in the loan.
2. The loan will be secured by a Promissory Note and Deed of Trust.
3. The Loan may be in 1st, 2nd or 3rd lien position at the discretion of the Town.
4. The Borrower may pre-pay either part or the entire loan at any time with no penalty charged for such repayment.
5. The owner is required to keep the taxes current, the property free from further liens and encumbrances superior to the lien of the Deed of Trust and premises insured at all times during the term of the loan.
6. The applicant must execute a contract for rehabilitation along with all other documents pertinent to the loan that the Town may require.
C. Forgiveness of Loan
The deferred loan will be forgiven based on the amount of the loan as follows:
· If a loan is less than $15,000, the loan term would be 5 years. The loan would be forgiven 20% per year for each full year of occupancy.
· If a loan is between $15,000 and $25,000, the loan term would be 10 years. The loan would be forgiven 10% per year for each full year of occupancy.
· If a loan is greater than $25,000 the loan term would be 15 years. The loan would be forgiven 6.66% per year for each full year of occupancy.
D. Eligibility Criteria
To be eligible for a deferred loan through the Comprehensive Rehabilitation Program, an applicant must meet the following criteria:
1. The property must be residential and located in the Northside neighborhood.
2. The annual gross income of the applicant must not exceed 80% of the area median income by household size. The Town will require income verification for up to three years prior to the application in order to determine income eligibility and the reasonableness of the assistance.
3. The applicant occupies the property to be rehabilitated and has a recorded ownership interest in the property (all parties having an ownership interest in the property are required to execute the Promissory Note and Deed of Trust).
4. The value of the loan must be supported by the equity value in the property.
5. The title to the property is insurable for the purpose of loan security.
6. The taxes on the property are paid up or payable from loan proceeds.
7. The property is not in violation of the Town’s Land Use Management Ordinance
8. The property is economically feasible to rehabilitate in the determination of the Town and has not received rehabilitation assistance from the Town or Orange County during the last ten years.
9. All parties having an ownership interest or who have executed any existing Deed of Trust or Promissory Note related to the subject property must meet income qualification standards.
10. The property must need repairs to meet the Town Code and federal, state and local laws and regulations.
E. Transfer Of Ownership Or Occupancy
1. If all or any part of the property or any interest in its is sold or transferred without the Town’s prior written consent, the Town may, at its option, require immediate payment in full of the loan, except when:
a. an heir or natural person devisee of the Borrower or Co-Owner whose income is below 80% of median income may continue in the place of the Borrower as Owner-Occupant subject to approval of the Town;
b. a transfer of ownership which does not affect the occupancy or ownership interest of the Borrower will not affect the status of the loan if prior written approval of such transfer is given by the Town;
c. if for medical reasons the Borrower is unable to remain in occupancy, the property may be rented to and/or occupied by a low or moderate-income person during the Borrower’s absence subject to prior written approval of the Town.
2. Requests for loan assumptions will be reviewed and addressed on a case-by-case basis. The Town will approve or disapprove such requests based on information supplied by the Borrower about the proposed transfer that the Town considers relevant and on terms and conditions that it considers in the best interest of the Town’s Comprehensive Rehabilitation Program. The Town may require the proposed transferee to sign an “Assumption Agreement” that is acceptable to the Town and that obligates the proposed transferee to keep all of the promises and agreements made in the Note, Deed of Trust, and all other loan and rehabilitation contract documents. The Borrower will continue to be liable under the Note, Deed of Trust, and all other loan and rehabilitation contract documents unless the Town releases the Borrower in writing.
III. REHABILITATION COST
A. Eligible Costs
1. The cost to correct code violations.
2. The cost to correct incipient violations.
3. The cost of building permits and related fees required to carry out the rehabilitation work, including but not limited to, architect and engineering fees.
4. The cost of changing a permitted non-conforming use to meet the requirement of the Town code.
5. The cost of handicapped accessibility retrofit.
6. The cost of effective energy efficient improvements.
B. Ineligible Costs
1. Materials fixtures, equipment or landscaping of a type or quality which substantially exceeds that customarily used in Chapel Hill for properties of the same general type as the property to be rehabilitated (however, the Owner may provide the difference between the cost of such materials, fixtures, etc. in cash at the loan closing).
2. Purchase, installation, or repair of furnishings.
3. Cost of acquiring the property to be rehabilitated.
4. Work done prior to the approval of the loan, or contracted for, either verbally or in writing, prior to the approval of the loan.
5. The payment of any lien or judgment including back taxes.
A. Inspection
1. The property shall be inspected by a Town of Chapel Hill Inspector to identify code violations, and a copy of the inspection report shall be furnished to the Town of Chapel Hill Planning Department.
2. The property shall be inspected by an Orange County Rehabilitation Inspector for the purpose of developing a work write-up.
1. A work write-up shall be prepared by the Town or its administrator, the Owner, or the Owner's Contractor that specifies the various items of work to be done and is of a form and substance acceptable to the Town.
2. The work write-up shall constitute the sole basis for cost estimates, bids and determination of completion of rehabilitation.
3. The work write-up may be revised prior to solicitation of bids by mutual consent of the Town and the Owner,
4. The work write-up may be amended after loan settlement only by a written "Construction Change Order" approved by the Owner, Contractor and the Town or its administrator.
1. A cost estimate shall be prepared by the Town or its administrator for its use in determining the feasibility of rehabilitation and determining whether the bids are fair and reasonable.
2. The acceptable bid must be within 15% of the Town's cost estimate.
3. Bids may be obtained by any one of three methods: negotiation, informal bids or formal competitive bids (see Orange County Rehabilitation Contractor's Handbook).
An Owner may act as his/her own Contractor only if the Town is satisfied he/she meets the following requirements:
1. Adequate knowledge, experience, doing rehabilitation work;
2. Adequate time to supervise the job; and
3. Adequate working capital to pay suppliers and sub-contractors before loan funds are released.
Only Contractors approved by the Town shall perform work under this program. Approval shall be contingent upon the Contractor providing and maintaining evidence of:
1. Proper license;
2. Adequate insurance;
3. Sufficient skill and experience;
4. Adequate working capital and/or credit; and
5. Acceptable references as to satisfactory performance.
C. Contractors' Register
The Town or its administrator shall maintain a "Rehabilitation Contractors' Register" listing Contractors approved by the Town. The Town may remove any Contractor from the Register who fails to comply with the requirements of this program. The Owner may submit any other Contractor or Contractors for approval.
A. The rehabilitation loan funds shall be obligated at the time of loan settlement. The rehabilitation loan funds shall be drawn down as needed to pay eligible rehabilitation cost in accordance with the current procedures of the U.S. Department of HUD and the Town of Chapel Hill.
B. Owner funds required as part of the rehabilitation cost shall be deposited in a custodial account. Unused Owner funds shall be returned to the Owner after completion without interest.
C. Progress payments may be made to the Contractor during construction in accordance with procedures described in the Rehabilitation Contractors' Handbook after documentation satisfactory to the Town.
A. The work contract shall be of a form and substance acceptable
to the Town and its administrator.
B. The work contract shall be between the Owner and the Contractor; the Town or its administrator assumes no responsibility for the performance, quality or sufficiency of the work under the contract or the interest of either party to the contract. The Town's or the Administrator’s actions with regard to the contract are to be construed as being solely in the interest of the Town of Chapel Hill Comprehensive Rehabilitation Program. Neither the Owner, Contractor, nor any participating lender shall be entitled to rely upon or deemed to be a beneficiary of any approval or inspection of the Town or its Administrator.
A. All rehabilitation work shall be performed in accordance with the General Specifications for rehabilitation, the work write-up and duly authorized change orders prepared and approved by the Town or its administrator.
B. Progress inspections shall be made by the Town or its administrator during normal business hours as often as deemed necessary by the Town to verify the satisfactory performance of the work. The Town assumes no responsibility for the performance, quality or sufficiency of the work under the contract or the interest of either party to the contract. The Town's actions with regard to the contract are to be construed as being solely in the interest of The Town of Chapel Hill’s Comprehensive Rehabilitation Program.
C. It shall be the responsibility of the Owner to ensure that the property meets the Rehabilitation Standards after completion.
D. The rehabilitation work shall be performed within an established time frame acceptable to the Town.
E. The Town will be responsible for work required to meet Rehabilitation Standards.
A. The Town or its administrator may develop and require the use of various forms, documents and procedures to further the purposes and objectives of the Comprehensive Rehabilitation Program. Such forms, documents and procedures shall be effective as of the date of adoption by the Town.
B. Application for rehabilitation loans must be approved by the Town of Chapel Hill Planning Department. Any application not so approved may be removed from the rehabilitation workload upon determination by the Town that the rehabilitation is not feasible or does not meet the purposes and objectives of the rehabilitation program.
C. The Town may refuse to provide rehabilitation assistance to any applicant who refuses to cooperate with the rehabilitation program and abide by these guidelines.
D. These guidelines shall be effective as of the date of adoption by the Town Council. Amendments hereto may be made at any time without notice to any party and shall be adopted and effective in like manner.
E. The following documents are hereby incorporated by reference and made a part hereof:
1. Orange County Housing Rehabilitation Standards;
2. Rehabilitation Contractors' Handbook issued by the Town;
3. General Specifications for Rehabilitation issued by the Town;
4. Town of Chapel Hill Land Use Management Ordinance;
5. Section 8 Housing Quality Standards set forth in HUD Handbook 7420.7, issued by the U. S. Department of Housing and Urban Development; and
6. Secretary of the Interior's Standards for Rehabilitation and Guidelines for Rehabilitation Historic Buildings (revised 1983), issued by the U. S. Department of Housing and Urban Development.
The Town may assist Homeowners and Investors to apply for other available rehabilitation loans including, but not limited to N. C. Housing Finance Agency home improvement loans and FHA home improvement loans and grants.
G. Requests for Subordination of Rehabilitation Loans
Subordination of Town of Chapel Hill rehabilitation loans shall be reviewed on a case-by case basis. Approval of subordination shall be at the sole discretion of the Town of Chapel Hill considering the circumstances of the case and the interests of the Town.
Contract for Rehabilitation Work
This Agreement, made this ________ day of ___________________________, 20___,
by and between _________________________________________________________
hereinafter called the “Contractor” and ____________________________ of Orange County, North Carolina, hereinafter called the “Owner”.
Witnesseth, that the Contractor and the Owner for the consideration stated herein mutually agree as follows:
2. Contract Documents. The Contract consists of the General Conditions of the Conditions of the Contract, the Supplementary General Conditions, if any, the Bid letting Document, the Basic Specifications, the Property Rehabilitation Standards, the Specifications and the Drawings together with this Agreement, from the entire contract between the parties hereto; and said General Conditions, Supplementary General Conditions, Basic Specifications, Bit letting Document, Property Rehabilitation Standards, Specifications and Drawings are hereby incorporated in this Agreement by reference.
3. Contract Price. For the services rendered under the terms and conditions of this contract by the Contractor, the owner or its representative shall pay the Contractor, subject to any additions and deductions, as provided in this Contract, the sum of $_________________________________dollars and__________________cents upon the satisfactory completion of the work described in this Contract.
4. Method of Payment. The Contractor will not be entitled to any progress payment in contracts under $10,000. One progress payment of 50% of the value based contract can be made upon completion of 60% of the work. There will be a 10% retaining fee for the 60 day inspection, which will be held 60 days after the final inspection.
5. Time for Completion. The Contractor agrees to start the construction work covered by this Contract upon receipt of a written Proceed Order from the Owners and will be satisfactorily completed within _______________( ) working days after the date specified in the Proceed Order as the beginning time for construction unless the time for completion is extended in writing by the owner.
Time is of the essence, and it is agreed that any delay beyond the time specified for completion stipulated herein shall result in the Contractor being charged with liquidated damages for delay in the sum of Ten Dollars ($10.00) a day for each day beyond the time limit agreed upon. The $10.00 per day assessment shall be deducted from the Contractor’s unpaid balance.
6. Care of Work. The Contractor shall exercise proper precaution at all times and shall be responsible for all damages to persons or property, either on or off the premises, that occur as a result of his fault or negligence in connection with the progress of the work. The Contractor shall be responsible for the proper care and protection of all work performed until completion and final acceptance, whether or not the same has been covered in whole or in part by payments made by the Owner. The Contractor shall be responsible for the removal and replacement of rugs, curtains, coverings, furniture and such other items as may be necessary for Contractor to perform work contemplated under this agreement and in the even any of such items are damaged, Contractor shall be responsible for the same. In the event that the progress of the work is interrupted for any reason, Contractor shall use his best efforts to place the premises in such state that allows continued normal occupancy by the owner during the period of interruption of work.
7. Indemnification of Owner. The Contractor shall indemnify and save harmless the Owner from liability for any injury or damages to persons or property resulting from this progress of work under this Contract.
8. Acceptance and Final Payment. Upon receipt of notice that the work is ready for final inspection and acceptance, the Owner along with his/her representative shall promptly make such inspection, and when he/she finds the work acceptable under the Contract and the Contract fully performed, he/she shall authorize the payment to the contractor to a sum sufficient to cover the balance of payment remaining in the Contract. Before the Contractor shall be paid in full, however, he/she shall submit evidence satisfactory to the Owner and the Owner’s representative that all payrolls, material bills, and other indebtedness connected with the work as relating to this contract have been paid. In the event of a dispute, acceptance and final payment is subject to Section 7 of the General Conditions.
9. Insurance.
a. The Contractor shall carry or require that there be carried Worker’s Compensation Insurance for all his employees and those of his subcontractors engaged in work at the site, in accordance with State Worker’s Compensation Laws
b. The Contractor shall carry the following insurance and submit a certificate of coverage prior to the execution of this Contract. Failure to maintain the insurance shall be grounds for termination of the Agreement.
Manufacturer’s and Contractor’s Public Liability Insurance with minimum limits of $100,000. Property Damage Insurance of an amount not less than $50,000.
10. Encumbrances. The Owner shall not encumber the property or make any conveyance of the property without the written consent of the Contractor while this contract is in force.
11. Inspections. The Rehabilitation Specialist, Building Inspector and other authorized representatives of Orange County and the State of North Carolina shall have the right to inspect the work while in progress and at the completion thereof. The Contractor shall remove or uncover such portions of the finished work as required by the Rehabilitation Specialist or Building Inspector during inspection. After inspection, Contractor will restore the finished work and correct any unacceptable work at no expense to the Owner.
12. Responsibilities of Owner.
a. The Contractor and all subcontractors shall have access to the residence described above, during the hours of 8:00 a. m. to 6:00 p. m., Monday through Friday, during the time work is in progress.
b. The Contractor may have reasonable use of electricity and water at the premises at no cost to the Contractor as is necessary for completion of the rehabilitation.
c. He/She shall be responsible for taking reasonable precautions to protect his/her personal property, such as furniture, during the course of the work.
d. Old Building materials and appliances that are being replaced as part of this contract shall belong to the contractor and shall be removed from the premises.
13. Conflict of Interest. The Contractor shall not have any interest, direct or indirect, present or perspective, in any dwelling described in this agreement which conflict in any manner or degree with the rehabilitation work, and has not employed by the Contractor and any employees of the Contractor so long as they are employed by the Contractor will not acquire any such interest. Further, no member of the governing body of the County, and no other officer, employee or agent of the County who exercises any functions or responsibilities in connection with the carrying out of the work to which this agreement pertains shall have any personal interest, direct or indirect, in this agreement. Immediate family members of said members, officers, employees, and officials are similarly barred from having any financial interest in the program.
14. Termination. In the event of breach of any condition or circumstances beyond the control of the Contractor, the County shall have the right, by prior notice to the Contractor, to terminate his employment hereunder and cancel this agreement and have the work called for hereby otherwise performed, without prejudice to any other rights or remedies of the County. The Contractor shall be entitled to receive compensation for all work completed and accepted prior to such termination or cancellation.
15. Nondiscrimination Clause. No person in the United States shall on the ground of race, color, national origin or sex be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity funded in whole or in part with funds available under this title (Section 109, Housing and Community Development Act of 1974).
16. Nondiscrimination on the Basis of Age. No qualified person shall on the basis of age be excluded from participation in, be denied the benefits of, or otherwise be subjected to discrimination under any program or activity which receives or benefits from Federal Financial Assistance.
17. Nondiscrimination on the Basis of Handicap. No qualified handicapped person shall, on the basis of handicap be excluded from participation in, be denied the benefits of, or otherwise be subjected to discrimination under any program or activity which receives or benefits from Federal Financial Assistance.
18. Executive Order Clause for Contracts $10,000 and Over. During the performance of this contract, the Contractor agrees as follows:
a. The Contractor will not discriminate against any employee or applicant for employment because of race, color, religion, sex or national origin. The Contractor will take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, or national origin.
Such action shall include, but not be limited to the following: employment, upgrading, demotion, or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The Contractor agrees to post in conspicuous places, available to employees and applicants for employment, notices to be provided by the contracting office setting forth the provisions of this nondiscrimination clause.
b. The Contractor will, in all solicitations or advertisements for employees placed by or on behalf of the Contractor, state that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex or national origin.
c. The Contractor will send to each labor union or representative of workers with which he has a collective bargaining agreement or other contract or understanding, a notice, to be provided by the County contracting officer, advising the labor union or workers’ representative of the Contractor’s commitments under Section 202 of Executive Order 11246 of September 24, 1965, and shall post copies of the notice in conspicuous places available to employees and applicants for employment.
d. The Contractor will comply with all provisions of Executive Order Number 11246 of September 24, 1965, and rules, regulation, and relevant orders of the Secretary of Labor.
e. The Contractor will furnish all information and reports required by Executive Order Number 11246 of September 24, 1965, and by the rules, regulations, and orders of the Secretary of labor, or pursuant thereto, and will permit access to his/her books, records, and accounts by the County and the Secretary of Labor for purposes of investigation to ascertain compliance with such rules, regulations and orders.
f. In the event of the Contractor’s noncompliance with the nondiscrimination clauses of this contract or with any of such rules, regulations, or orders, this contract may be cancelled, terminated, or suspended in whole or in part and the Contractor may be declared ineligible for further Government contracts in accordance with procedures authorized in Executive Order number 11246 of September 24, 1965, and such other sanctions may be imposed and remedies involved as provided in Executive Order Number 11246 of September 24, 1965 , or by rule, regulation, or order of the Secretary of Labor, or as otherwise provided by law.
g. The Contractor will include the provisions of paragraphs (1) through (7) in every subcontract or purchase order unless exempted by rules, regulations or orders of the Secretary of labor issued pursuant to Section 204 of the Executive Order Number 11246 of September 24, 1965, so that such provisions will be binding upon each subcontractor or vendor. The Contractor will take such action with respect to any subcontract or purchase order as the contracting agency may direct as a means of enforcing such provisions including sanctions for noncompliance: Provided, however, that in the event the contract becomes involved in, or threatened with, litigation with a subcontractor or vendor as a result of such direction by the contracting agency, the Contractor may request the United States to enter into such litigation to protect the interests of the United States.
19. Section 3 Clause. The contractor agrees to comply with the Provision of Training, Employment, and Business Opportunities in the Section 3 Clause as follows:
a. The work to be performed under this contract is on a project assisted
under a program providing direct Federal Financial assistance from the Department of Housing and Urban Development and is subject to the requirements of Section 3 of the Housing and Urban Development Act of 1968, as amended, 12 U.S.C. 1701j. Section 3 requires that to the extent feasible opportunities for training and employment be given lower income residents of the project area and contracts for work in connection with the project be awarded business concerns which are located in, or owned in substantial part by persons residing in the area of the project.
b. The parties to this contract will comply with the provisions of said Section 3 and the regulations issued pursuant thereto by the Secretary of Housing and Urban Development set forth in 24 CFR 135, and all applicable rules and orders of the Department issued thereunder prior to the execution of this contract. The parties to this contract certify and agree that they are under no contractual or other disability which would prevent them from complying with these requirements.
c. The Contractor will send to each labor organization or representative of workers with which he has a collective bargaining agreement or other contract or understanding, if any, a notice advising the said labor organization of workers representative of his commitments under this Section 3 clause and shall post copies of the notice in conspicuous places available to employees and applicants for employment and training.
d. Compliance with the provisions of Section 3, the regulations set forth in 24 CFR Part 135, and all applicable rules and orders of the Department issued hereunder prior to the execution of the contract, shall be a condition of the federal financial assistance provided to the project, binding upon the applicant or recipient for such assistance, its successors or assigns. Failure to fulfill these requirements shall subject the applicant or recipient, its subcontractors and contractors, its successors or assigns to those sanctions specified by the grant or loan agreement of contract through which federal assistance is provided, and to such sanctions as are specified by 24 CFR Part 135.
20. Copeland “Anti-Kickback” Act. Each Contractor shall be prohibited from
inducing by any means, any person employed in the construction, completion, or repair of public work, to give up any part of the compensation to which he is otherwise entitled. The grantee shall report all suspected or reported violations to the grantor agency (NRCD).
21. Access to Records and Record Retainage Clause. In general, all official
project records and documents must be maintained during the operation of this project and for a period of five years following close out in compliance with 15 NCAC 13L Rule .0911, Recordkeeping. The County is also required to maintain these records for a period of five years following close out of the project. The North Carolina Department of Natural Resources and Community Development, the North Carolina Department of the Treasure, U. S. Department of Housing and Urban Development, the Comptroller General of the United States or any of their duly authorized representatives, shall have access to any books, documents, papers and records of the Administering Agency which are pertinent to the execution of this Agreement, for the purpose of making audits, examinations, excerpts and transcriptions.
22. Lead Base Paint Clause. The Contractor will comply with the following
lead based paint regulations; (1) Prohibition of the use of lead based paint. (2) Elimination of immediate lead-based paint hazards and (3) Notification to residents and purchasers of structures constructed prior to 1950 of the hazards of lead based poisoning. To the extent that the subject matter of this contract involves residential structures, the Contractor will comply with the lead-based paint regulations.
23. Disputes. In the event that there is any question or dispute with respect to the interpretation or the manner of implementation of this Agreement or related documents or with respect to the execution and progress of the work, the parties hereto agree that said questions or disputes shall be submitted to the Rehabilitation Specialist for settlement.
The Rehabilitation Specialist shall provide a written statement of his findings to the owner and the Contractor within ten (10) days after the referral.
If the owner or Contractor do not agree with the findings, an appeal shall be submitted to the Director of Orange County Housing and Community Development. The appeal shall be filed in writing, and shall include a written statement indicating specifically why the owner or contractor refuses to accept the findings of the Rehabilitation specialist stating the basis for difference. After considering the basis for differences, the Orange County Housing and Community Development Director or his/her designee shall provide a written statement of findings to each party within ten (10) calendar days after the consideration of the appeal.
If a finding is made in favor of the Contractor, but the owner fails or refuses to execute a Certificate of Completion on Contractor’s work or to pay or complete any act whereby payment can be made on owner’s behalf to Contractor, then owner’s rights of withholding payment will be considered waived and payment will be made to Contractor.
If a finding is made in favor of the Owner but the Contractor does not take the necessary corrective action within ten (10) calendar days to satisfy the finding, then the Contractor’s rights to any unpaid claims or retention shall be considered waived and the County shall have the right to use such funds to take such remedial action as is necessary.
In Witness Whereof, the parties hereto have caused this Agreement to be executed on the day and year first above written.
Date: ________________________ _______________________________(Seal)
Contractor
Accepted By: _________________ By: ___________________________(Seal)
_____________________________ Title: __________________________
Owner Date
_____________________________ ________________________________
Owner Date Address
_____________________________ ________________________________
Witness Date City, State, Zip Code