Section 5. Property Rehabilitation Standards The term Property Rehabilitation Standards means the combination of code standards and rehabilitation requirements which are established for properties to be retained in the conservation area. The term code standards means the requirements of local building, housing, zoning, plumbing, electrical, fire prevention, and other laws related to housing construction and to use, maintenance, and occupancy of properties. The term rehabilitation requirements means the criteria, in addition to code standards, which are established for properties in the conservation area to assure their restoration to a sound condition. Rehabilitation requirements may be either (1) requirements which residential properties must meet in order to be eligible for FHA Section 220 mortgage insurance, or (2) comparable requirements, if conventional mortgage financing is to be used for either residential or nonresidential properties. These requirements shall be developed by the LPA in consultation with HHFA Regional Office staff, FHA or mortgage lending institutions if FHA assistance is not anticipated, and local code officials. They shall be adapted to the physical conditions prevailing in the area and the anticipated effect of the conservation program on the individual properties. Property Rehabilitation Standards shall be: (1) Sufficiently high to assure the long-term useful life of the properties and to justify the costs involved. (2) Feasible of practical application to existing physical conditions within the area. The LPA's conservation program shall be directed at achieving the Property Rehabilitation Standards for all properties to be retained in the conservation area. At the time of the final project audit (see Chapter 18-1), (1) Property Rehabilitation Standards shall have been accomplished on at least 75 percent of the properties which have been retained, (2) code standards shall have been achieved on at least 95 percent of the properties which have been retained, and (3) the LPA must be making a continuing effort to eliminate deficiencies on the remaining properties. The properties referred to in Items (1) and (2) include properties upgraded to Property Rehabilitation Standards through a rehabilitation demonstration, and properties acquired by the LPA and disposed of for upgrading to Property Rehabilitation Standards (see Section 12-1-9). Section 6. Determining Feasibility of Property Rehabilitation The physical and financial feasibility of renewing individual properties shall be determined on the basis of (1) property surveys, and (2) family surveys or other appropriate investigations. These surveys shall also be the basis for the establishment of Property Rehabilitation Standards. PROPERTY SURVEYS Prior to submission of the Survey and Planning Application, a limited exterior survey shall be made to reach a preliminary judgment as to the suitability of conservation treatment for the area. This survey may be accomplished by driving or walking through the proposed area. Existing data shall be utilized to the fullest extent possible. Early in the planning stage, a survey shall be made of the exterior and interior of a limited number of typical properties. This survey will provide information which the LPA, in collaboration with HHFA will use to formulate tentative Property Rehabilitation Standards and to make a preliminary judgment on the economic feasibility of conservation. Normally, this survey will be made by FHA unless FHA participation is definitely not anticipated. Arrangements may be made through the HHFA Regional Office for FHA to make this survey. Prior to submission of Part I of the Application for Loan and Grant: (1) An exterior survey shall be made of all properties in the area for the purpose of classifying them as standard, capable of rehabilitation, or requiring demolition. (2) An interior survey shall be made of properties that cannot be so classified through exterior examination, if necessary to reduce the number of unclassified properties to a reasonably small proportion of the total number. Prior to authorization of the Contract for Loan and Grant, HHFA will concur in the initiation of final property surveys to determine specific improvements required to meet Property Rehabilitation Standards (see Section 12-1-8), under the following conditions: (1) The HHFA Regional Office has approved the proposed Property Rehabilitation Standards. (2) Planning of the project has advanced to the point that the LPA has identified a substantial number of properties which are to be retained. (3) The survey is limited to the properties proposed to be retained. (4) There is satisfactory evidence of organized understanding of and support for the project. After final property surveys have been completed, written notification of specific improvements required may be sent to owners of property to be retained. 7/12/62 1 Property surveys shall be conducted by qualified personnel experienced in building construction, costs, and property values. FAMILY SURVEYS Prior to submission of Part I of the Application for Loan and Grant, family surveys may be made to obtain information on the financial feasibility of improving properties to Property Rehabilitation Standards. Financial feasibility includes (1) debt-carrying capacity of owners, and (2) for investment property, the relationship of anticipated increases in income or value to the costs of the proposed improvements. Family surveys shall be conducted by qualified personnel experienced in interviewing and survey techniques. The number, scope, and extent of the surveys shall be kept to the essential minimum by using existing data to the fullest extent possible. EFFECT OF SPECIAL ASSESSMENTS If public improvements are proposed to be locally financed in whole or in part through special benefit assessments against properties in the area, the LPA shall demonstrate that the levying of special assessments will not impair the feasibility of conservation. Any such demonstration of feasibility shall take into account (1) the relationship of both the amount and the method of payment of the proposed special assessments to the debt-carrying capacity of both the properties and the property owners in the area, (2) the effect, if any, of the assessments on the availability of mortgage financing, and (3) the willingness of owners to carry out rehabilitation under these circumstances. This information shall be included in the Rehabilitation and Conservation Report (see Section 12-1-7, Item B3, and Section 17-4-1). When discussions with the FHA Insuring Office are initiated, the LPA shall indicate its intention to use special assessments in the conservation area, so that the willingness of FHA to insure mortgages in view of the assessments can be considered as early as possible. If the qualifications described above cannot be met, the area will be acceptable for Title I assistance only if the necessary project improvements are financed without special assessments. K xperi Section 7. Rehabilitation and Conservation Report The Rehabilitation and Conservation Report, submitted with Part I of the Application for Loan and Grant (see Chapter 12-2), shall contain at least the following items in the following order: A. Basis of Property Rehabilitation Standards contained in Urban Renewal Plan (see Sections 12-1-5 and 12-1-6), including summary of: 1. Adequacy of codes and ordinances as a basis for achieving 2. Actions taken to adopt, revise, or amplify code standards. a. FHA requirements and adaptability in light of physical b. Requirements for residential properties if FHA assistance is not anticipated, and for nonresidential properties. B. Basis of finding of feasibility of property rehabilitation (see Section 12-1-6), including: 1. Summary, for typical properties, of: a. Anticipated extent of repairs and improvements which will be required. b. Tentative estimates of cost of renewing properties to Property Rehabilitation Standards and resulting estimated increases in property values. 2. Tabulation and narrative statement summarizing and analyzing surveys and other investigations, indicating: a. "Before" and "after" appraisals. b. Debt-carrying capacity of properties. c. Debt-carrying capacity of owners. d. For investment property, relationship of anticipated increases in income or value to costs of proposed improve ments. e. Proposed tax abatements or deferred assessments on property improvements. 3. Statement of effect of any special assessments on: a. Debt-carrying capacity of properties and property owners. b. Availability of mortgage financing. c. Willingness of owners to carry out rehabilitation. |