Background Continued:
The individual tests conducted on each lot by Howland
indicated that clay was present in the soil.
Moisture or lack of moisture causes clay soil to expand or contract,
which explains why there was movement on the slab-on-grade foundation.
City staff also contacted Arredondo Group, engineering and construction firm from San Antonio, TX to provide concurrence with the remedies proposed by Howland and to provide an estimate of foundation repair. Arredondo group recommended that 27 of the 50 units with a recorded differential movement of more than 1¼ inches be addressed by piering to repair and or stabilize the foundation from future movement and settlement. Arredondo group noted that the remaining homes with differentials of 1¼ inches or less would not require underpinning. Repairs in the form of drainage, cosmetic and foundation improvements as may be applicable depending on the level of distress for each home, and anticipated contingency and engineering costs are estimated to total $865,000.
The HUD San Antonio Field Office had initially informed staff that the City could not utilize federal funds through the HOME and/or Community Development Block Grant program to address housing repairs. City staff, however, did seek a waiver from HUD to allow for the reinvestment of HOME Program Income and that HUD consider match contribution from a non-federal source to offset the use of HOME Program Income. A response from HUD is still pending. In light of the existing suit, City staff, however, recommends that the City move forward with the improvements from a non-federal source. The City of Laredo does not have funds available through its General Fund; however, an alternative funding source is the Laredo Municipal Housing Corporation.
The Laredo Municipal Housing Corporation currently maintains a fund balance of over $1.8 million that has been built up throughout the course of the Corporation’s existence. Transfer of these funds for the stated purpose is allowable under the Municipal Housing Corporation’s Articles of Incorporation and would not impede operations and/or planned capital improvements.
Therefore, staff proposes that the fund balance of $865,000 of the Laredo Municipal Housing Corporation be transferred to a City of Laredo CIF fund to facilitate the necessary repairs to the homes constructed as part of the Los Obispos Housing Project by the Laredo Affordable Housing Corporation.
ORDINANCE No.2003-O-096
Amending the Laredo Municipal Housing FY 2003 budget by drawing down and appropriating $865,000 from the opening balance to the City’s Capital Improvement Fund. This transfer will be set up to carry out necessary repairs associated with the owner-occupied units constructed by the Laredo Affordable Housing Corporation as part of Los Obispos Affordable Housing Project. The amendment is authorized by the Laredo Municipal Housing Corporation’s Article’s of Incorporation.
WHEREAS, as part of the Los Obispos Affordable Housing Project funded through the HOME Investment Partnerships Program (HOME), the Laredo Affordable Housing Corporation partnered with the City of Laredo in the construction of 50 single family housing units that were made available for purchase by first time homebuyers of low to moderate income; and
WHEREAS, in follow-up to concerns from assisted homeowners regarding housing construction defects and visible evidence of structural distress, the City of Laredo contracted with the firm of Howland Surveying, Inc. to conduct a structural assessment of the Los Obispos housing units; and
WHEREAS, the results of the study conducted by Howland Surveying, Inc. confirmed that structural distress was present at varying degrees within all the homes tested; and
WHEREAS, the HUD San Antonio Field Office had initially stated that the City could not utilize federal funds through the HOME and/or Community Development Block Grant Program to address housing repairs; and
WHEREAS, the City did seek a waiver from HUD to allow the reinvestment of HOME Program Income and further consideration that match contributions from a non-federal source be allowed to off-set the use of HOME Program Income, and HUD’s response is still pending; and
WHEREAS, it is in the best interest of the affected property owners’ that the City move forward with the needed repairs; and
WHEREAS, the estimated cost of remediation varies based on the severity of the structural distress of each unit and the individual unit costs associated with foundation and general repairs, drainage improvements, as well as the proposed purchase of some homes that had severe structural distress, and
WHEREAS, the City of Laredo does not have funds available through its General Fund to undertake the needed remediation efforts; and
WHEREAS, the Laredo Municipal Housing Corporation currently maintains a fund balance of over $1.8 million that has been built up throughout the course of the Corporation’s existence; and
WHEREAS, transfer of these funds for the stated purpose is allowable under the Municipal Housing Corporation’s Articles of Incorporation and would not impede the Municipal Housing Corporation’s operations and/or planned capital improvements.
NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LAREDO, THAT:
1. The City Of Laredo Budget will be amended for the Laredo Municipal Housing FY 2003 budget by drawing down and appropriating $865,000 from the opening balance to the City’s Capital Improvement Fund. This transfer will be set up to carry out necessary repairs associated with the owner-occupied units constructed by the Laredo Affordable Housing Corporation as part of Los Obispos Affordable Housing Project. The amendment is authorized by the Laredo Municipal Housing Corporation’s Article’s of Incorporation.
2. Budget Amendment will consist of:
ANNUAL BUDGET PROPOSED AMENDMENT AMENDED BUDGET 2003
Laredo Municipal Housing
Transfer CIF Fund 0 $865,000 $865,000
CIF Fund:
Revenue: Transfer In-Mun.
Housing 0
$865,000
$865,000
Expense: Los Obispo’s Housing Proj 0 $865,000 $865,000
PASSED BY THE CIY COUNCIL AND APPROVED BY THE MAYOR ON THIS THE __________ DAY OF ______ 2003.
______________________
ELIZABETH G. FLORES
MAYOR
ATTEST:
_______________________
GUSTAVO GUEVARA, JR.
CITY SECRETARY
APPROVED AS TO FORM:
JAIME L. FLORES
CITY ATTORNEY
BY: ______________________
ANTHONY MCGETTRICK
ASSISTANT CITY ATTORNEY
