City staff recommends the City Council approve the Resolution to adopt standardized, market-driven contract limits reflecting current local conditions to preserve the viability of the City's Foreclosure Acquisition / Rehabilitation Program; to include the ability to purchase vacant lots to build new affordable housing; and continue City Administrator authority to sell properties acquired through the Foreclosure Acquisition / Rehabilitation Program to qualifying low-income households. The new Resolution will Repeal Resolutions 10-18921, 10-18984, 11-19122, 13-19325, and 17-10660.

The median sales price limit established by the U.S. Department of Housing and Urban Development (HUD) for property acquisition in the Billings Metro Area has increased 53 percent from 2017 to 2023. However, contract limits for the City's Foreclosure Acquisition / Rehabilitation Program have not increased since 2017. Likewise, construction costs have increased more than 27 percent over the past seven years as per the U.S. Inflation Calculator while contract limits remained static.

City staff will continue to prioritize highly dilapidated properties in / near the city's lower-income neighborhoods that require substantial rehabilitation.

Because rehabilitated homes will be sold to an income-qualified First Time Home Buyer applicant, all low-income community members are considered stakeholders. In addition, neighbors living near the homes have often dealt with a dilapidated, vacant structure for several years, so they will likely be thankful to have the home rehabilitated and occupied following the sale.

City Council may:

• Approve the Resolution; or,
• Not Approve the Resolution. Not approving the resolution will leave it out of alignment with current costs and market-driven contract limits reflecting current local conditions to preserve the viability of the City's Foreclosure Acquisition / Rehabilitation Program.

The Foreclosure Acquisition / Rehabilitation Program utilizes pass-through CDBG funding from HUD. City resources are not used for this program.

Establishing limits that automatically adjust to current local market conditions will help ensure the sustainability and viability of the City's Foreclosure Acquisition / Rehabilitation Program. A greater number of housing units and land parcels would be eligible for acquisition and would expand quality affordable housing options throughout the city. This would also assist the City in meeting current and future CDBG expenditure deadlines.

City staff recommends the City Council approve the Resolution to adopt standardized, market-driven contract limits reflecting current local conditions to preserve the viability of the City's Foreclosure Acquisition / Rehabilitation Program; to include the ability to purchase vacant lots to build new affordable housing; and continue City Administrator authority to sell properties acquired through the Foreclosure Acquisition / Rehabilitation Program to qualifying low-income households. The new Resolution will Repeal Resolutions 10-18921, 10-18984, 11-19122, 13-19325, and 17-10660.