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CITe.... OF SAN BERNARDIO - REQUEO FOR COUNCIL ACnN
Dept:
Community Developm@7 SEP -II m :0: 32
It\t~: - At+iWI:~ OF REQUEST FOR PROPOSAL
I . TRli'~l FOR' THE RENTAL REHABILIT A nON,
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From:
Kenneth J. Henderson~~~OM1N. OFF.
Date:
September 3, 1987
Synopsis of Previous Council action:
In July, 1984, the Mayor and Common Council authorized staff to apply for funds in the amount of $122,900
for the Rental Rehabilitation Program.
In September, 1984, the Mayor and Common Council authorized Redevelopment Agency staff to open a
checking account with First Interstate Bank for the Rental Rehabilitation Program.
In December, 1984, the Mayor and Common Council authorized staff to submit a program application to
HUD for second year funding for the Rental Rehabilitation Program.
In January, 1985, the Mayor and Common Council approved the agreement for escrow services for the Rental
Rehabilitation Program with United States Escrow.
Recommended motion:
That the Mayor and Common Council authorize and direct staff to issue Request for
Proposals (RFP) for escrow services forFY 1987/1988 Rental Rehabilitation Program.
Contact person:
Ken Henderson/Nestor Nazario
Phone:
5065
Supporting data attached:
Yes/Staff Report
Ward:
1-7
FUNDING REQUIREMENTS:
Amount:
N/A
Source:
(ACCT.
(ACCT.
NO.) N/A
DESCRIPTION)
N/A
Finance:
Council Notel:
Agenda Item No.
-3,
~Iy\,.. OF SAN BERNARDI~ - REQUEQ FOR COUNCIL AC1.:bN
STAFF REPORT
On January 11, 1985, the Mayor and Common Council authorized
staff to contact local escrow companies to determine whether
said companies could provide escrow services in support of
the Rental Rehabilitation Program (RRP). since United states
Escrow was familiar with the RRP and was providing the
specialized accounting and reporting requirements to a number
of other California cities participating in the program, and
was willing to provide these services at a reasonable fee
(which is reimbursable by HUD under the program), staff
recommended that the City of San Bernardino enter into an
agreement with united States Escrow. The Mayor and Common
Council adopted the staff recommendation.
Over the last several months, staff has experienced great
difficulty with United States Escrow due to continuous staff
turnover since January 1987. Staff has contacted at least
three (3) different citieS that had previously retained the
services of united States Escrow and have been advised that
they have obtained the services of other escrow companies.
Aside from United states Escrow's services declining in
quality, they have elected to increase their fees without
proper acknowledgement and approval by the city.
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Several meetings with United States Escrow have been
unsuccessful in correcting the issues described. At the same
time, staff has been researching the market to determine if a
better quality of service is now available.
In order to further the goals and objectives of the RRP,
staff is hereby requesting that the City of San Bernardino
re-open contract negotiations under competitive bidding
procedure to ensure that the highest quality of escrow
services are being received at the most reasonable rate.
It has been determined that other escrow companies are also
specializing in assisting cities in fund transfers, program
accounting, loan collection and in development of detailed
reports on Rental Rehabilitation Program activities to meet
HUD requirements. I feel it is appropriate to issue a RFP
for these and other services in order to obtain the most
cost-effective escrow service for the City and its Rental
Rehabilitation Program.
I recommend adoption of the form motion.
Development
KJH/NN/lab/0464
9/3/87
75-0264
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CITY ~ SAN BERNARDIW
RENTAL REHABILITATION PROGRAM
)
"Request for proposals"
for
Escrow Services
A. Purnose
The city of San Bernardino is seeking escrow services to undertake
financial services in support of the city's Rental Rehabilitation
Program. The services should include the capability of assuming
ongoing services of the City, such as support of new section 312
rehabilitation lending.
B. Backaround
The City of San Bernardino through financial incentives enables
owners of rental units in need of rehabilitation to fix up their
properties. Low interest loans from the city are available for
fifty percent (50%) of the cost of correcting substandard
conditions in these properties, with a maximum of $5,000.00 per
unit. Program funds will be provided to eligible investor/owners
as an amortized or deferred loan. Loans will accrue interest on
the unpaid balance at the rate of four percent (4%) per annum.
Owners must agree not to convert assisted units to condominiums for
a period of not less than ten (10) years and seventy percent (70%)
of the current tenant families must have incomes which do not
exceed eighty percent (80%) of the median income (currently $28,800
annually).
In order to further the goals and objectives of the Rental Rehab-
ilitation Program, it is the City's policy to re-open contract
negotiations under competitive bidding procedures to ensure the
highest quality of escrow services are being received at the most
reasonable rate.
C. Expectations of the Contractor
The contractor must be able to provide the following services (free
of errors and omissions) in a timely manner and at a reasonable
cost:
1. Loan Document preoaration Services: Upon request from the City
in connection with each loan application, the contractor will
provide applicable credit reports, title reports and appraisals
of subject properties. Following loan approval, the City will
provide the contractor with a written request for preparation of
loan documents including loan disbursement instructions,
promissory notes, notice of rescission, deed of trust or other
securing documents, request for notice of title change, truth in
lending disclosure statement, and any other documents agreed to
by the contractor and the city. Upon execution of said
documents, the City will return to the contractor the original
signed documents, including the disbursement instructions, deed
of trust or mortgage or other securing instrument, request for
notice of title change, and loan proceeds. The contractor will
send the deed of trust, mortgage or other securing instrument
and the request for notice to the County for recording.
Ci~ of San Bernardino C :)
community Development Department
"Request for proposals" for Escrow Services
September, 1987
Page -2-
,,)
2. Fund Disbursement Services: After receipt of loan proceeds and
in accord with the loan disbursement instructions, the
contractor will identify and verify the payment authorization
and make disbursements as so indicated. A retention amount will
be withheld until thirty (30) days following notice of comple-
tion. Contractor shall record the notice of completion with the
County. The contractor shall provide the city with a monthly
status report of all transactions completed to date and the
balances remaining in each account no later than ten (10)
calendar days at the end of each month. Upon final payment for
a project, the contractor shall provide a project closing state-
ment to the City detailing all account activity.
3. Additional SCODe of Services to be Provided Include:
a) Loan Collection Services
b) Deferred Payment Loan Services and Management
c) Maintenance of Files and Availability of Data
d) Cash Management Depository Services
e) Reconciliation of RRP Depository Account Activities
f) Loan Foreclosure Services
g) Section 312 Cash Management Services
h) Rehabilitation Technical Consulting Assistance
i) Davis-Bacon Wage Compliance Monitoring and Accounting
j) Construction Final Disbursement (Escrow) and Accounting
D. ProDosal Criteria
The contractor responding to this RFP should provide evidence of
their qualifications as evidenced by previous contracts or projects
of a similar nature conducted for other cities. References must be
provided.
The contractor should explain in the proposal the methodology to be
applied, if selected, to perform the services described. Such
methodology is to include, (but not be limited to), the willingness
to perform under a tight timetable and the approximate turnaround
time for each of the services described herein. A contingency plan
for dealing with unexpected problems or difficulties which may
arise should also be included.
For each of the services described above, the contractor should
provide a schedule of fees which will be in effect during the
contract period. Fees will include costs to the City (if any) for
services provided as well as fees charged to the Ci~y's clients.
Finally, please note that the contractor shall describe its
policies on affirmative action and its willingness to abide by all
mandated equal opportunity provisions in the execution of services
under the proposed contract.
,
l.. C
City of San Bernardino
community Development Department
"Request for Proposals" for Escrow Services
september, 1987
Page -3-
o
)
E. Deadline for Submission
To be considered, proposals must be complete, signed by a person
with the authority to commit the necessary resources to undertake
the responsibility of performing financial services for the city of
San Bernardino Rental Rehabilitation Program. The proposal must be
submitted to the Community Development Department, 300 North "D"
street, Fifth Floor, San Bernardino, California, 92418, attention:
Nestor Nazario, Rehabilitation Coordinator, no later than 4:00
'Oem.. on
Any questions regarding this RFP should be directed to Mr. Nazario at
714/384-5065. Collect calls will not be accepted and proposal costs
will not be reimbursed.
flab
0463