1996 NS CDBG Program Development Agreement Amendment Magnolia Place Subdivision

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1 Orange County Board of County Commissioners Action Agenda Item No. V=_5 Action Agenda Item Abstract Meeting Date: August 5, 1996 Subject: CDBG Program/Development Agreement Amendment Department: Housing/Community Development Public Hearing Yes No x Budget Amendment Needed Yes No Attachment(s) Information Contact: Tara L. Fikes, ext. 2490 Amendment Telephone and Extension Number Hillsborough 732-8181 Chapel Hill 968-4501 Durham 688-7331 Mebane 227-2031 Purpose: To approve an Amendment to the Development Agreement under the CDBG Program with the Orange Community Housing Corporation (OCHC) for the Magnolia Place subdivision. Background: The Board of County Commissioners approved a Development Agreement with the Orange Community Housing Corporation (OCHC) for the Magnolia Place subdivision. Magnolia Place, located in Hillsborough, is a planned 42 unit subdivision for first time homebuyers. CDBG funds are being utilized for the construction of public improvements and will remain in the project as a second mortgage for prospective homebuyers, thereby, reducing the amount of the buyer's first mortgage. Eleven homes have been completed and sold with approximately 14 lots presold, under construction, and/or under contract to qualified buyers. In addition, the Rural Housing and Community Development Service (formerly known as Farmers Home Administration) is providing mortgages to some buyers. The original agreement provided second mortgages in the amount of $12,352.50 to twenty perspective homebuyers for a total of $247,050.00. However, OCHC has provided second mortgages in the $12,500 to ten first-time homebuyers. In order to reconcile the difference, the remaining 10 second mortgages will have to be in the amount of$12,205.00. Further, the original completion date for Magnolia Place was specified as December 31, 1995. The project has not been completed, however, development seems to be progressing well and OCHC projects a June 30, 1997 completion date. In order to incorporate the above changes, the original Agreement must be amended. An amendment has been prepared for the Board's approval. Recommendation: The Manager recommends approval of an Amendment to the Development Agreement under the CDBG Program with the Orange Community Housing Corporation (OCHC) for the Magnolia Place subdivision and authorizes the Chair to sign the amendment on behalf of the Board after the review and approval of the County Attorney.