Focus Area: Economy, Community Development
Staff Contact: Mike Sirna and JJ O’Toole-Curran
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title:
title
Report regarding proposed amendment to the City’s Rehabilitation Policy Loan Program.
Body
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recommended motion:
Accept the report. A resolution approving the amendment to the City’s Rehabilitation Policy Loan Program will be on the October 20, City Council agenda.
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Summary:
The proposed amendment would establish a clear and consistent framework for the City to consider requests on a case-by-case basis while continuing to protect the City’s financial, legal, and program interests. The policy would establish a process for evaluating mortgage subordination requests, including approval thresholds based on total secured debt and current appraised property value. It would also allow limited consideration of debt consolidation requests in extreme hardship circumstances when housing stability can be supported without creating unreasonable risk to the City.
In cases involving documented medical hardship, the policy would provide a process for considering full or partial loan forgiveness, mortgage releases, repayment plans, delayed repayment, lien modifications, or other appropriate remedies. To support consistent, individualized decisions, the policy includes evaluation factors, an administrative appeal process, and documentation and coordination requirements with the Finance Department and City Attorney’s Office, as appropriate. The proposed approach is intended to align with the County’s practice of considering hardship-related requests individually based on relevant documentation and the facts of each case, while providing the City appropriate discretion to respond to exceptional circumstances and maintain accountability and responsible stewardship of public funds.
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Financial Information:
The proposed policy amendment is not expected to have an immediate or material budgetary impact. It establishes procedures and decision-making criteria for evaluating homeowner hardship requests involving existing Housing Rehabilitation Program loans and mortgages.
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Attachment(s):
A. DRAFT: City of Olathe Housing Rehabilitation Loan Program Policy Amendment
B. DRAFT: Resolution