4.7. SR 09-03-2013 City of
Elk - Request for Action
River O.
To Item Number
Mayor and City Council 4.7
Agenda Section Meeting Date Prepared by
Consent September 3, 2013 Brian Beeman,Director of Economic
Development
Item Description Reviewed by
Authorize Central Minnesota Housing Partnership Jeremy Barnhart,Deputy Director, CODD
(CMHP) to Write and Administer Pre-Application Reviewed by
for the Small Cities Development Program (SCDP) Cal Portner, City Administrator
with a Commitment of$50,000 in Leverage Funds
Action Requested
Authorize by motion CMHP to write and administer the pre-application for the Small Cities
Development Program with a commitment of$50,000 in leverage funds.
Background/Discussion
The HRA has been working toward the development of a housing program to address identified
community needs,including first time home buyer's assistance, affordable housing, rehab assistance, and
foreclosure prevention.
The HRA has retained the services of Central Minnesota Housing Partnership (CMHP) to write and
administer grants per the HRA housing goals and directed them to apply for a grant to assist in the
funding of the programs. Part of that grant process is to complete a pre-application,which is due
November 14, 2013.
The city will be notified by mid-December if we are successful in the pre-application. If so, CMHP will
write the full application for the SCDP program which is due February 27, 2014. The city will be notified
in June 2014 if the funding for the grant has been awarded.
The pre-application fee is $350 and will be paid by the HRA. The HRA also budgeted $50,000 in leverage
funds as recommended by CMHP. The leverage funds will not be used unless the city is successful in the
full grant award. However,as part of the pre-application, CMHP needs a written commitment of the
leverage funds. The HRA and Council's approval serves as the commitment.
Financial Impact
N/A
Attachments
■ Staff reports from earlier touch points with the HRA
P a w E A E U s r
NaA f RE]
Elk REQUEST FOR ACTION
River
TO ITEM NUMBER
Housing and Redevelopment Authority-
AGENDA SECTION MEETING DATE PREPARED BY
July 8, 2013 Brian Beeman,Director of Economic
Development
ITEM DESCRIPTION REVIEWED By
Discuss and determine which housing agency best fits the city's Jeremy Barnhart,Deputy Director,
housing needs based on the HRA's housing goals Community Operations and
Development Director
REVIEWED BY
ACTION REQUESTED
Information presented for discussion only. Action is anticipated at the August HRA meeting.
BACKGROUND/DISCUSSION
The HRA has indicated a strong interest in being more proactive in housing programs. At the May 6,
2013 HRA meeting,the HRA set some housing goals and directed staff to address some community
housing needs including: 1"time home buyer's assistance, affordable housing, rehab assistance, and
foreclosure prevention.
In developing draft policies to address these goals, Staff has met with the Minnesota Housing Finance
Agency (MHFA),Minnesota Central MN Housing Partnership (CMHP),Tri County Action Partnership
(Tri-CAP),Brooklyn Park and Coon Rapids staff, and researched several other Minnesota housing
programs.
Through this process,it became clear that outside agencies provide the services desired by the HRA, at a
fraction of the cost of administering our own program. For example, CMHP or Tri-CAP can address the
HRA's preferences for 1"time buyer's assistance, affordable housing, rehab assistance, foreclosure
prevention,and a variety of other housing programs. It is staff s recommendation that the City utilize
these resources more aggressively for the benefit of city residents. Both entities will be at the meeting on
July 8th to further discuss their programs.
Staff seeks HRA consensus on which housing agency will best fit the needs of the community and the
HRA housing goals. After a consensus is reached,the HRA will take action on the hiring of one of the
housing agencies at the August 1, 2013 regular HRA meeting. In order to start applying for the Small
Cities Development Grant for 2014, one of the agencies will need to start the grant writing process in
August or September to meet the pre-application deadline.
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Elk REQUEST FOR ACTION
River
TO ITEM NUMBER
Housing and Redevelopment Authority ?.
AGENDA SECTION MEETING DATE PREPARED BY
August 5, 2013 Brian Beeman,Director of Economic
Development
ITEM DESCRIPTION REVIEWED By
Hire CMHP or Tri-CAP to write &administer grants and HRA Jeremy Barnhart,Assistant
housing goals. Community Operations and
Development Director
REVIEWED BY
ACTION REQUESTED
Hire CMHP or Tri-CAP to write and administer grants and HRA housing goals.
BACKGROUND/DISCUSSION
The HRA has indicated a strong interest in being more proactive in housing programs. At the May 6,
2013 HRA meeting,the HRA set some housing goals and directed staff to address some community
housing needs including: 1"time home buyer's assistance, affordable housing, rehab assistance, and
foreclosure prevention.
In developing draft policies to address these goals, Staff has met with the Minnesota Housing Finance
Agency (MHFA),Minnesota Central MN Housing Partnership (CMHP),Tri County Action Partnership
(Tri-CAP),Brooklyn Park and Coon Rapids staff, and researched several other Minnesota housing
programs.
Through this process,it became clear that outside agencies provide the services desired by the HRA, at a
fraction of the cost of administering our own program. For example, CMHP or Tri-CAP can address the
HRA's preferences for 1"time buyer's assistance, affordable housing, rehab assistance, foreclosure
prevention,and a variety of other housing programs. It is staff s recommendation that the City utilize
these resources more aggressively for the benefit of city residents. At the July 8, 2013 HRA workshop,it
became clear that the HRA would like to focus on rehabbing housing in Elk River and were interested in
the Small Cities Development Program (SCDP) to accomplish this goal.
The HRA met in a workshop July 8, 2013 to hear presentations from CMHP and Tri-CAP.The HRA
discussed pros and cons of both agencies and how each agency would or would not be able to meet the
HRA's housing goals. After discussing options,the HRA focused discussion on the Small Cities
Development Program (SCDP) and directed staff to gather information regarding each organization's
administration of the SCDP for the August meeting. The SCDP grants funds to local units of
government who then lend out to home or business owners for rehabilitation or new construction based
on community needs. In order to start applying for the SCDP for 2014, one of the agencies will need to
start the grant writing process in August or September 2013 to meet the pre-application deadline.
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Below is a table comparing the two agencies regarding administration of the SCDP grant program.
Comparison of SCDP Administration
CM H P Tri-CAP
Preliminary Application $350 $0
Fee
Experience 11 successful grant None
applications in the past
9 years
Other Programs Home Stretch,Will Lead Testing,Radon testing,
Offered work with Tri-CAP to Energy Audits,Financial fitness,
offer their programs Food Support,Tax Assistance,
Weatherization
Payback 0%deferred forgivable 0%deferred forgivable loan
loans with flexible term with flexible term
Use City Building Yes Yes
Inspectors
Tiered Loan Structure? Yes Yes
(Borrower pays a
portion of the loan and
the rest is forgivable)
Leverage funds $25,000 10-20%of funding request
recommended
Administrative Fees 15%of funding request 15%of funding request
Many of the requirements are mandated by the state,but there are some differences between the two
organizations. Each organization offers unique programs, however the two agencies work together often.
Regardless of which agency receives the grant, they will partner with the other agency to provide
information on both agencies'programs.
The leverage funds were estimates provided by each organization. Both have stated that the more the
HRA puts in,the more likely the application is to get funded. This figure would be determined by staff
and the HRA with the guidance of the administrating organization at the time of application.
Attachments:
None
Elk REQUEST FOR ACTION
River
TO ITEM NUMBER
Housing and Redevelopment Authority
AGENDA SECTION MEETING DATE PREPARED BY
August 26, 2013 Brian Beeman,Director of Economic
Development
ITEM DESCRIPTION REVIEWED By
Discuss Small Cities Development Program grant structure and Jeremy Barnhart,Deputy Director,
guidelines. Community Operations and
Development Director
REVIEWED BY
ACTION REQUESTED
Information presented for discussion only.
BACKGROUND/DISCUSSION
At the HRA's August 5, 2013 meeting, the Housing and Redevelopment Authority approved the hiring of
Central Minnesota Housing Partnership (CMHP) to apply for and administer the Small Cities
Development Program (SCDP) grant.The SCDP will provide the financial resources and structure to
rehabilitate housing in Elk River. In applying for the SCDP for 2014, CMHP intends to begin the grant
writing process in August to meet the pre-application deadline of November 14, 2013. As part of that
pre-application,the structure of the program should be identified.
CMHP will be present to explain the grant process, typical structure, and guidelines of the grant and an
explanation of what has been and what has not been successful in the other communities that they have
worked with. Many of the requirements are mandated by the state;however, CMHP has indicated that
some of the grant guidelines can be altered.
Previously, the HRA has stated their goals for the program should:
• Be similar to Coon Rapids' housing rehabilitation program.
• Be tiered whereby the homeowners would pay a percentage or amount of the rehabilitation
project before the remaining amount of their project is awarded.
• Include three tiers based upon income levels or a set percentage of the project.
At the August 5, 2013 meeting, the HRA had several questions about how the SCDP should and could be
structured. The responses to those questions are attached.
Timing/next steps. With agreement on the terms, structure, and guidelines of the SCDP grant, and
payment of the application fee, CMHP will start the pre-application process and regularly report back to
the HRA throughout the grant writing process. If the City is successful in the pre-application, CMHP will
write the full application for the SCDP program which,is due February 27, 2014. The City of Elk River
will be notified if the funding for the grant has been awarded to the City in June 2014.
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Attachments
• Preliminary Questions and Answers Sheet from CVIHP