Low-income Napa homeowners will soon be able to apply for grants to make emergency repairs on their property.
On Tuesday, the Napa City Council moved federal money around to give its Housing Rehabilitation Program Loan Fund more funds. As part of the move, the city will now be able to offer emergency grants of up to $1,500 each, in addition to offering rehabilitation loans of $5,000 or more.
“If somebody calls up and they need a water heater, or someone threw a brick through their front window, with an emergency repair program, by regulation, we can bypass a lot of the steps you have to take for a rehab loan,” said Joseph Wiencek, the program’s supervisor. “It saves a lot of time, and we can actually make emergency repairs.”
Until now, the city has rarely used the federal loan money for expenditures under $5,000 because of the amount of administrative work that is required to distribute the funds. With the establishment of an emergency repair program, the city will be able to expedite the process.
“I think that’s great because there are so many crises like that amongst the seniors, they just don’t have an extra $400 or $200,” Councilman Peter Mott said. “I think that’s probably the most important component because I think it matters a great deal.”
The council moved about $191,000 in federal Community Development Block Grant (CDBG) money left over from completed, under-budget projects to the rehabilitation fund, which is also funded by the federally awarded CDBG.
The move comes after the city reprogrammed $200,000 from the rehab fund to pay for the installation of a public restroom at O’Brien Park, with the understanding that it would return that money to the rehab program at a future date.
Councilman Alfredo Pedroza recused himself from the discussion and vote because he sits on the board of directors of Community Action Napa Valley, which is funded in part by CDBG.
The rehabilitation loan program is funded through CDBG and on average, $275,000 to $300,000 is loaned each year, Wiencek said.
Wiencek told the council Tuesday that now was the time to put more money into the rehabilitation fund, as its funds for the current year have been exhausted and he believes more people may apply for money as interest rates have been lowered. This year, the city awarded or committed money to renovate 55 low-income residences, according to a staff report.
Low-income residents who have equity in their homes or landlords who rent to low-income residents may apply for loans to make repairs. Depending on income level, they can repay those loans either when they sell or refinance their property, or make payments over time, Wiencek said.
“When our new policies and procedures were approved in November, they included lowering our interest rates on our loans and providing no-interest rates for our deferred loans, which should make it a lot more acceptable to our residents that are really in need but were kind of scared off by our interest rates,” Wiencek said.
In the case of amortized loans, the city will adjust the rate annually based on the Federal Deposit Insurance Corp. Passbook Savings Rate, which is .04 percent, Wiencek said.
“For homeowners, you would add one point to that, so we would be offering 1.04 percent loans,” he said. “If you qualify for a deferred payment loan, which is probably 85 to 90 percent of our loans these days, that interest rate has been eliminated. They will not accrue interest. Whatever they borrow, that’s what they will pay back.”
“We think that’s going to be pretty attractive to the people who took applications, filled out the application and at the last minute decided 3 percent interest was just too much,” he added.
The city plans to limit the money distributed for emergency repairs to $10,000, Wiencek said. When a qualifying homeowner comes to the city requesting an emergency grant, Wiencek will visit the property, make an assessment and estimate, then call a pre-approved contractor to do the work.
Wiencek said the city plans to unveil the emergency repair grant program March 1 at the annual senior wellness fair at the Senior Activity Center.