062220 EDA Meeting Packet
EDA MEETING
City Hall, 4401 Xylon Avenue North
Monday, June 22, 2020
President Kathi Hemken
Commissioner John Elder
Commissioner Cedrick Frazier
Commissioner Andy Hoffe
Commissioner Jonathan London
1. Call to order – EDA Meeting of June 22, 2020
2. Roll call
3. Approval of Minutes:
• June 8, 2020
4. Resolution approving forgivable loan of CDBG funds to Twin Cities Habitat for
Humanity, Inc.
5. Adjournment
EDA Meeting
Page 1 June 8, 2020
City of New Hope
4401 Xylon Avenue North
New Hope, Minnesota 55428
EDA Minutes June 8, 2020
Regular Meeting City Hall
CALL TO ORDER President Hemken called the meeting of the Economic Development Authority to
order at 7:53 p.m.
ROLL CALL Present:
Kathi Hemken, President
John Elder, Commissioner
Cedrick Frazier, Commissioner
Andy Hoffe, Commissioner
Jonathan London, Commissioner
Staff Present:
Kirk McDonald, City Manager
Jeff Alger, Community Development Specialist
Dan Boyum, City Engineer
Tim Fournier, Director of Police
Megan Hedstrom, Stormwater Specialist
Beth Kramer, Communications Coordinator
Valerie Leone, City Clerk
Susan Rader, Director of Parks & Recreation
Jeff Sargent, Director of Community Development
Bernie Weber, Director of Public Works
Stacy Woods, Assistant City Attorney
APPROVAL OF
MINUTES
Item 3
Motion was made by Commissioner Frazier, seconded by Commissioner Elder, to
approve the minutes of April 27, 2020. All present voted in favor. Motion carried.
4215 LOUISIANA
AVE N
(IMPROVEMENT
PROJECT NO. 1047)
Item 4
President Hemken introduced for discussion EDA Item 4, Resolution approving
contract with JACON LLC for hazardous material abatement, tree removal,
demolition of site improvements, site grading, sewer lining, and water service
valve replacement at 4215 Louisiana Avenue North (Improvement Project No.
1047).
Mr. Jeff Alger, community development specialist, illustrated the property’s
location adjacent to Cook Automotive. He stated the city acquired the property at
4215 Louisiana Avenue North in February of 2020. Staff sought quotes for
demolition and recommends approval of a contract with JACON LLC fo r
hazardous material abatement, tree removal, demolition of site improvements,
site grading, sewer lining, and water service valve replacement for $32,278. He
stated the steps are necessary to prepare the site for building demolition to
facilitate redevelopment of the property with a single-family home. He noted the
city has worked with this contractor in the past and has a good experience with
the contractor. Funding for the work is available in the EDA budget. He also noted
the intention to rezone the property from community business to single-family
residential.
EDA Meeting
Page 2 June 8, 2020
Commissioner London inquired of the proposed expenses.
Mr. Alger stated the low quote of $32,278 for demolition is less than the estimated
$37,000. He also pointed out the acquisition cost was less than other scattered site
projects and the new house will likely sell for $350,000. He confirmed that the RFP
included the requirement to have a fence installed along the southern property
line.
RESOLUTION 2020-05
Item 4
Commissioner Hoffe introduced the following resolution and moved its adoption
“RESOLUTION APPROVING CONTRACT WITH JACON LLC FOR
HAZARDOUS MATERIAL ABATEMENT, TREE REMOVAL, DEMOLITION
OF SITE IMPROVEMENTS, SITE GRADING, SEWER LINING, AND WATER
SERVICE VALVE REPLACEMENT AT 4215 LOUISIANA AVENUE NORTH
(IMPROVEMENT PROJECT NO. 1047).” The motion for the adoption of the
foregoing resolution was seconded by Commissioner Elder, and upon vote being
taken thereon, the following voted in favor thereof: Hemken, Elder, Frazier, Hoffe,
London; and the following voted against the same: None; Abstained: None;
Absent: None; whereupon the resolution was declared duly passed and adopted ,
signed by the president which was attested to by the executive director.
3924 UTAH AVE N
(IMPROVEMENT
PROJECT NO. 1020)
Item 5
President Hemken introduced for discussion EDA Item 5, Resolution approving
sale of 3924 Utah Avenue North (Improvement Project No. 1020).
Mr. Jeff Alger, community development specialist, requested the EDA to approve
the sale of 3924 Utah Avenue North to Ethan Lederer for $387,000. He explained
the EDA purchased the vacant and distressed property in December of 2018 as
part of the city’s scattered site housing program. He stated Day Construction
completed the rehabilitation of the home that included improvements to nearly all
interior and exterior areas of the house. He presented “before” and “after”
photographs to illustrate the improvements. Mr. Alger stated the list price was
$371,900, and there were multiple offers on the property. He stated the offer is a
purchase price of $387,000 with 2.5% (or $9,675) brokerage fee to buyer’s real estate
agent with a closing date of July 16, 2020. He noted by selling the home without a
listing agent, the city will save between $10,000 to $12,000 in brokerage fees.
Mr. Alger stated there is a funding gap of only $14,152 (paid through the EDA
budget), the 30-year return on investment is 4.55%, and the 30-year internal rate
of return is 6.33%.
Mr. Jeff Sargent, director of community development, pointed out that Day
Construction did an outstanding job on the house. He congratulated Mr. Alger in
skillfully managing the project and selling the property for $16,000 over asking
price.
The City Council and City Manager McDonald also complimented Mr. Alger on
the project.
President Hemken opened the public hearing for comments, and no one requested
to speak at the public hearing.
EDA Meeting
Page 3 June 8, 2020
CLOSE HEARING
Item 5
Motion was made by Council Member Hoffe, seconded by Council Member
Frazier, to close the public hearing. All present voted in favor. Motion carried.
RESOLUTION 2020-06
Item 5
Commissioner London introduced the following resolution and moved its
adoption “RESOLUTION APPROVING SALE OF 3924 UTAH AVENUE
NORTH (IMPROVEMENT PROJECT NO. 1020).” The motion for the adoption
of the foregoing resolution was seconded by Commissioner Frazier, and upon vote
being taken thereon, the following voted in favor thereof: Hemken, Elder, Frazier,
Hoffe, London; and the following voted against the same: None; Abstained: None;
Absent: None; whereupon the resolution was declared duly passed and adopted ,
signed by the president which was attested to by the executive director.
ADJOURNMENT Motion was made by Commissioner Frazier, seconded by Commissioner Elder, to
adjourn the meeting. All present voted in favor. Motion carried. The New Hope
EDA adjourned at 8:17 p.m.
Respectfully submitted,
Valerie Leone, City Clerk
I:\RFA\COMM DEV\2020\EDA\Scattered Site Housing\06-22-20\Q - Habitat For Humanity Rehab Contract 06-22-20.docx
Request for Action
June 22, 2020
Approved by: Kirk McDonald, City Manager
Originating Department: Community Development
By: Jeff Alger, Community Development Specialist;
Jeff Sargent, Director of Community Development
Agenda Title
Resolution approving forgivable loan of CDBG funds to Twin Cities Habitat for Humanity, Inc.
Requested Action
Staff requests approval of a resolution approving a forgivable loan of Community Development Block
Grant funds in the amount of $76,250 to Twin Cities Habitat for Humanity, Inc.
Policy/Past Practice
The city has collaborated with Habitat for Humanity in the past on the acquisition and rehabilitation of
housing units within the city.
Background
At the November 12, 2019, Economic Development Authority (EDA) meeting, CM Frazier requested that the
city broaden its scattered site housing program to include affordable housing projects for first time
homebuyers. The city has worked with Habitat for Humanity on several projects in the past, most recently on
a rehabilitation project in 2012. Staff met with representatives of Habitat for Humanity in early 2020 to
discuss potential opportunities for affordable scattered site housing projects. The use of Community
Development Block Grant (CDBG) funds was discussed at the February 18, 2020, work session, with a
majority of the City Council supporting the splitting of available funds between the Hennepin County Home
Rehab Program and an affordable home rehabilitation project, through an organization such as Habitat for
Humanity. According to HUD, “the CDBG Program provides annual grants on a formula basis to states,
cities, and counties to develop viable urban communities by providing decent housing and a suitable living
environment, and by expanding economic opportunities, principally for low- and moderate-income persons.”
Hennepin County allocates CDBG funds from HUD to New Hope and several other cities in the county. A
resolution approving use of the 2020 CDBG funds and remaining 2019 CDBG funds was approved at the
February 24, 2020, City Council meeting. This included $76,250 in allocations for a rehabilitation project.
Staff coordinated a call with Chad Dipman, Project Systems Supervisor with Habitat For Humanity, and the
city attorney in April to discuss how an agreement would be structured. Habitat for Humanity requested the
approval of non-project-specific funds in order to eliminate the need to have a funding contingency in the
purchase agreement, which can be a factor in a seller’s willingness to sign an agreement with Habitat for
Humanity (especially in strong housing market). A contingency requiring City Council approval of a specific
project would require Habitat For Humanity to ask for at least a month long contingency. Due to the COVID-
19 pandemic, Habitat for Humanity requested until the end of 2021 (at the latest) to complete the project. The
city attorney has prepared the attached resolution and loan commitment letter, providing $76,250 in CDBG
funds to Habitat for Humanity in the form of a forgivable loan. Habitat for Humanity and Hennepin County
reviewed the loan commitment letter and have no concerns. A third party agreement between the city and
Habitat for Humanity establishing the rules of the CDBG program will be drafted by Hennepin County.
Agenda Section
EDA
Item Number
4
Request for Action, Page 2
Funding
Hennepin County cannot distribute CDBG funds until the project has been completed. The upfront loan of
$76,250 to Habitat for Humanity would be funded utilizing EDA funds. Upon completion of the project, the
city would request to be reimbursed for the $76,250 from Hennepin County (CDBG funds) and would then
forgive the loan to Habitat for Humanity. The EDA fund would be reimbursed and the funds could be used
for a future project.
Recommendation
Staff recommends approval of a resolution approving a forgivable loan of CDBG funds in the amount of
$76,250 to Twin Cities Habitat for Humanity, Inc.
Attachments
Resolution
Loan commitment letter (June 22, 2020)
City Council & EDA minutes (November 12, 2019, February 18, 2020, February 24, 2020)
1
CITY OF NEW HOPE
ECONOMIC DEVELOPMENT AUTHORITY
EDA RESOLUTION NO. 20-___
APPROVING FORGIVABLE LOAN OF CDBG FUNDS TO
TWIN CITIES HABITAT FOR HUMANITY, INC.
BE IT RESOLVED by the Economic Development Authority in and for the City of New Hope
(“EDA”) as follows:
WHEREAS, the EDA is allocated Community Development Block Grant (“CDBG”) funds from
Hennepin County each year;
WHEREAS, the EDA has determined that it would further community redevelopment goals to lend a
total of $76,250 comprised of $61,500 in 2019 CDBG allocated funds and $14,750 in 2020 CDBG allocated
funds to Twin Cities Habitat for Humanity, Inc. (“Habitat”) for purposes of redevelopment of a residential
property in the City of New Hope to be determined by Habitat;
WHEREAS, the $76,250 will be lent to Habitat in the form of a forgivable loan to ensure that Habitat
uses the funds specifically for acquisition and rehabilitation of a residential property in the City of New Hope
and the loan will be secured by a mortgage;
WHEREAS, Habitat will have the discretion to locate the residential property and determine the scope
of the rehabilitation pursuant to their program guidelines;
WHEREAS, the EDA hereby authorizes and approves the loan of $76,250 in CDBG allocated funds
to Twin Cities Habitat For Humanity, Inc. per the terms of the attached Loan Commitment.
NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the
City of New Hope as follows:
1. The is hereby authorized and directed to sign the attached Loan Commitment for the loan of
$76,250 in CDBG allocated funds to Twin Cities Habitat for Humanity, Inc. for the specific purposes of
acquiring and rehabilitating a New Hope residential property for re-sale to a qualified buyer.
2. The President and Executive Director are further authorized and directed to take any additional
and reasonable actions or steps necessary to effect the loan of the CDBG funds to Twin Cities Habitat for
Humanity, Inc.
____________________________________
Kathi Hemken, President
Attest: _____________________________
Kirk McDonald, Executive Director
P:\Attorney\SAS\1 Client Files\2 City of New Hope\99-11439 CDBG Funding to Habitat for Humanity\Resolution approving loan of CDBG funds to Habitat.docx
June 22, 2020
Twin Cities Habitat for Humanity, Inc.
Attn: Chad Dipman, Project Systems Supervisor
1954 University Avenue West
St. Paul, MN 55104
Re: Loan Commitment of CDBG Funds From New Hope EDA to Twin Cities Habitat for
Humanity, Inc.
Dear Mr. Dipman:
Based upon discussions between the Economic Development Authority in and for the City of New
Hope (‘‘EDA’’) and Twin Cities Habitat for Humanity, Inc. (‘‘Habitat’’), the EDA has agreed to
loan certain Community Development Block Grant (‘‘CDBG’’) funds allocated to the EDA by
Hennepin County to Habitat. Specifically, the EDA has agreed to loan a total of $76,250
(‘‘Loan’’) comprised of $61,500 in 2019 CDBG allocated funds and $14,750 in 2020 allocated
CDBG funds to Habitat for the purchase and rehabilitation of a residential real property in the
City of New Hope to be determined by Habitat (‘‘Real Property’’) pursuant to the terms set forth
herein. The proceeds of the Loan shall be utilized by Habitat for the purpose of acquiring the
Real Property in the City of New Hope and rehabilitating the same pursuant to Habitat guidelines
and re-selling the Real Property to a qualified buyer (the ‘‘Project’’).
A. LOAN AMOUNT. The EDA will advance to Habitat a principal amount (the ‘‘Loan
Amount’’) of $76,250 once Habitat has identified a Real Property for the Project.
B. PROMISSORY NOTE. The Loan Amount shall be evidenced by and payable in
accordance with the terms of a Promissory Note (the ‘‘Note’’). The Note shall provide:
1. Interest Rate. Interest shall be at an annual rate of one percent (1%).
2. Payment Schedule. No payments shall be due or payable unless or until Habitat
fails to acquire a Real Property in New Hope and rehabilitate it pursuant to the
terms contained herein.
3. Default. If Habitat fails to acquire a Real Property in New Hope and rehabilitate it
pursuant to the terms contained herein, all accrued and unpaid interest and the
Principal Balance shall be paid in full.
4. Prepayment. The Note may be prepaid at any time without penalty.
2
5. Application of Payments. All payments and prepayments shall, at the option of
the EDA, be applied first to the cost of collection (including reasonable attorney’s
fees), second to late charges, third to accrued interest on the Note, and lastly to the
principal balance.
6. Forgiveable Loan. So long as Habitat uses 100% of the Loan to acquire a
residential Real Property located in New Hope and rehabilitates it on or before
December 31, 2021 for purposes of re-sale to an owner -occupant, the entire Loan
shall be forgiven and Habitat shall have no obligation to repay the Loan or any part
thereof to the EDA.
The commitment of the EDA to make the Loan is based upon the information furnished and
representations made to the EDA by or on behalf of Habitat. This commitment is subject to
the truth and accuracy of said information and representations as of the date of the Note.
Additionally, the commitment of the EDA to make the Loan is based upon certain
requirements being met and loan documentation being executed including specifically:
1. Mortgage. A Mortgage (the “Mortgage”) duly executed and delivered by Habitat
granting to the EDA a mortgage lien in and to the Real Property upon which the Project is
to be located and all buildings and improvements now or hereafter located thereon, all
fixtures, appurtenances, hereditaments and attachments now or hereafter attached thereto,
all proceeds of the foregoing to secure repayment of the Note.
2. Title Policy. The EDA shall have received a fully paid ALTA mortgagee's title insurance
policy issued by a title insurance company acceptable to the EDA, in form and substance
satisfactory to the EDA, naming the EDA as the insured and insuring the Mortgage to be
a valid lien on marketable fee simple title in the name of the Habitat to the Real Property,
subject only to such liens and encumbrances and such exceptions as are approved in
writing by the EDA and, without limiting the generality of the foregoing, specifically
insuring against mechanics' liens, matters which would be disclosed by a comprehensive
survey, rights of parties in possession, and such other endorsements as shall be requested
by the EDA.
3. Taxes and Special Assessments on the Property. All current and all delinquent real
estate taxes shall have been paid as of the date of Closing on the Property taken as
security for the Loan Amount. Any deferred special assessments and all levied special
assessments together with all special assessments yet to be levied for improvements
which, prior to the Closing, have been authorized by any governmental unit or agency
which are commenced or for which a construction contract has been entered into prior to
the Closing shall have been paid
4. Loan Contingent on Successful Environmental Review. The Loan is contingent upon
Hennepin County performing and receiving an acceptable environmental review of the
real property as a part of the CDBG program. Habitat shall cooperate with Hennepin
County in providing all necessary documentation as a part of the environmental review
including scope of work and lead based paint disclosures and testing.
3
5. Compliance with Governmental Regulations. The EDA shall have received evidence
satisfactory to it that the Real Property and the contemplated development and use of the
Project will be permitted by all applicable restrictions and requirements in prior
conveyances, zoning ordinances, subdivision and platting requirements and other laws
and regulations, but subject to approval by the municipal or other governmental
authorities having jurisdiction.
C. Closing. This Loan must be closed on or before December 31, 2021, or the EDA’s
obligation hereunder shall terminate at its discretion and Habitat shall upon demand
return any portion of the Loan advanced to Habitat to the EDA.
D. Representations and Warranties. By signing this Commitment, Habitat represents to
the EDA that the following matters are true and correct in all respects:
1. There is no action, suit or proceeding pending or threatened against or affecting
Habitat which, if adversely determined, would have a material adverse effect on
the condition (financial or otherwise), properties or assets of Habitat or which
would question the validity of this Commitment or any instrument, document or
other agreement related thereto or required thereby, or impair the ability of Habitat
to perform their obligations hereunder or thereunder.
2. Habitat is not in default of a material provision under any material agreement,
instrument, decree or order to which Habitat is a party or by which Habitat is
bound or affected.
3. Habitat has filed all tax returns required to be filed and have paid all taxes shown
thereon to be due, including interest and penalties, which are not being contested
in good faith and by appropriate proceedings, and have no information or
knowledge of any objections to or claims for additional taxes in respect of federal
or state income tax returns for prior years.
4. There are no judgments or tax liens outstanding or docketed against Habitat.
E. Borrower Authority.
1. Habitat shall provide the following, certified to the satisfaction of the EDA:
a. Certificate of Good Standing;
b. Resolutions of the Board of Directors and Incumbency Certificate certified
as of the closing date by the President.
4
F. General Conditions.
1. There shall, at the time of closing, be no action, proceeding or investigation
pending or threatened (or any basis therefor) which might materially adversely
affect the condition, business or prospect of Habitat, the Real Property, or which
might adversely affect the ability of Habitat to perform its obligations under the
loan documentation.
2. There shall be no default in the performance of any undertaking or agreement
required to be performed by the application or this commitment. This
commitment and any information, representation or warranty contained therein or
furnished to the EDA in connection with the Loan shall not contain any untrue
statement or omit to state any fact necessary to make the application, this
commitment or any such information, representation or warranty not misleading,
it being intended by Habitat that the EDA in the making of the Loan shall rely in
all respects upon the truth and completeness of the application, this commitment
and such information, representations and warranties.
3. All of the representations, warranties and agreements made herein, in the
application for the Loan, or in connection with the Loan shall survive the closing
and inure to the benefit of the EDA and the City of New Hope, its successors and
assigns.
4. There shall have been no material adverse change in the interim period from the
date of the application for the Loan to the closing in the financial condition or in
the assets, net worth or credit standing of Habitat.
If the foregoing terms, conditions and agreements are acceptable, please execute the enclosed copy
of this letter and return it to the EDA. Thereupon, this Commitment will become a binding
agreement between Habitat and the EDA in accordance with its terms and shall be deemed a loan
agreement to the extent that the same is not inconsistent with loan documentation executed
pursuant to this C ommitment Letter.
Sincerely,
Economic Development Authority
in and for the City of New Hope, a public body
corporate and politic created pursuant to the
laws of the State of Minnesota
By: ________________________________
Kirk McDonald
Its: Executive Director
5
CONFIRMED AND ACCEPTED AS OF THE _____ DAY OF ________, 2020.
Twin Cities Habitat for Humanity, Inc.
By: _______________________________
Its: ______________________________
P:\Attorney\SAS\1 Client Files\2 City of New Hope\99-11439 CDBG Funding to Habitat for Humanity\Loan Commitment.docx
EDA Meeting
Page 1 November 12, 2019
City of New Hope
4401 Xylon Avenue North
New Hope, Minnesota 55428
EDA Minutes November 12, 2019
Regular Meeting City Hall
CALL TO ORDER President Hemken called the meeting of the Economic Development Authority to
order at 7:22 p.m.
ROLL CALL Present: Kathi Hemken, President
John Elder, Commissioner
Cedrick Frazier, Commissioner
Andy Hoffe, Commissioner
Jonathan London, Commissioner
Staff Present: Kirk McDonald, City Manager
Jeff Alger, Community Development Specialist
Tim Fournier, Police Chief
Valerie Leone, City Clerk
Jeff Sargent, Director of Community Development
Stacy Woods, Assistant City Attorney
APPROVAL OF
MINUTES
Item 3
Motion was made by Commissioner Frazier, seconded by Commissioner Elder, to
approve the minutes of October 28, 2019. Voted in favor thereof: Hemken,
Frazier, Hoffe, London; and the following voted against the same: None;
Abstained: Elder; Absent: None. Motion carried.
IMPROVEMENT
PROJECT NO. 1018
Item 4
President Hemken introduced for discussion EDA Item 4, Resolution approving
purchase and redevelopment agreements with Great Buy Homes, Inc. for the sale
of both lots contained within the plat of Lammle Addition (Improvement Project
No. 1018).
Mr. Jeff Alger, community development specialist, stated the city acquired 5355
Oregon Avenue North in April of 2018 and the site has been re -platted as two
buildable lots. He noted West Metro Fire completed training exercises at the site.
Mr. Alger explained the Request for Proposals (RFP) marketing proposal that was
conducted for the scattered site lots located at 5353 and 5355 Oregon Avenue
North. Stipulations of the RFP included a minimum lot sales price of $60,000 and
that the proposed houses must be owner-occupied, single-family homes (for two
years).
Mr. Alger stated the city received proposals submitted by Great Buy Homes,
Houston Homes, My Home Source, and Novak -Fleck. He stated staff’s
recommendation is to sell the lots to Great Buy Homes for $130,000 ($65,000 per
lot). He reviewed the characteristics of the house plans (total finished square
footage, number of bedrooms, garage size and interior/exterior finishes) along
with the cost and tax impact of the improvements, the return on investment, and
tax benefit associated with the increased property value.
EDA Meeting
Page 2 November 12, 2019
Mr. Alger commented one of the main goals of the scattered site housing program
is to improve neighborhoods.
President Hemken opened the floor for comments from the audience. There was
no one present desirous of addressing the EDA for the public hearing.
Mr. Glen Hammer, owner of Great Buy Homes, was recognized. He thanked the
EDA for the opportunity to work with the city again.
Commissioner Frazier expressed support for the program as it revitalizes
neighborhoods. He mentioned past projects that involved Habitat for Humanity
and recommended pursuing some affordable housing projects for first time
homebuyers in the future.
CLOSE HEARING
Item 4
Motion was made by Council Member Elder, seconded by Council Member
Frazier, to close the public hearing. All present voted in favor. Motion carried.
RESOLUTION 2019-11
Item 4
Commissioner London introduced the following resolution and moved its
adoption “RESOLUTION APPROVING PURCHASE AND
REDEVELOPMENT AGREEMENTS WITH GREAT BUY HOMES, INC. FOR
THE SALE OF BOTH LOTS CONTAINED WITHIN THE PLAT OF LAMMLE
ADDITION (IMPROVEMENT PROJECT NO. 1018)”. The motion for the
adoption of the foregoing resolution was seconded by Commissioner Elder, and
upon vote being taken thereon, the following voted in favor thereof: Hemken,
Elder, Frazier, Hoffe, London; and the following voted against the same: None;
Abstained: None; Absent: None; whereupon the resolution was declared duly
passed and adopted, signed by the president which was attested to by the
executive director.
ADJOURNMENT Motion was made by Commissioner Frazier, seconded by Commissioner Elder, to
adjourn the meeting. All present voted in favor. Motion carried. The New Hope
EDA adjourned at 7:37 p.m.
Respectfully submitted,
Valerie Leone, City Clerk
City Council Work Session February 18, 2020
Page 5
Discussion ensued regarding a ban on all flavored tobacco products, whether or not to
prohibit pharmacies from selling tobacco products, and whether to raise the age of
those legally allowed to sell tobacco products to 18. Council acknowledged concerns
expressed by the business community. Council supported removing the language that
makes the purchase of tobacco products by someone under the age 21 a punishable
offense. A reduction of the city’s 21 tobacco licenses through attrition was discussed;
the city clerk commented gas stations frequently change ownership and reduction of
tobacco licenses through attrition may be difficult to administer.
Council Member Elder recommended banning the flavors that target youth.
Council directed staff to prepare an ordinance amendment raising the legal age to 21
to purchase tobacco products, banning cartridge based e-cigarettes except for tobacco
flavor and banning flavored tobacco products except for menthol, mint, and
wintergreen flavors.
Mr. Bell stated the proposed ordinance amendment will be presented to Council at a
future work session.
AFFORDABLE
SCATTERED SITE
HOUSING PROJECTS
Item 11.6
Mayor Hemken introduced for discussion item 11.6, Discuss affordable scattered site
housing projects.
Mr. Jeff Sargent, director of community development, and Mr. Jeff Alger, community
development specialist, updated Council regarding affordable scattered site housing
projects.
Mr. Sargent explained that the scattered site housing program has allowed the city to
remove deteriorated homes and increase property values through new construction.
Staff has been directed to target distressed single-family properties throughout the city,
with the goal of improving residential neighborhoods. He stated since 2014, the city
has coordinated the rehabilitation of two single-family homes and the construction of
20 new single-family homes on 16 lots.
Mr. Sargent stated at the council meeting of November 12, 2019, Council Member
Frazier requested that the city broaden its scattered site housing program to include
affordable housing projects for first time homebuyers. As a result, staff met with
representatives from Habitat For Humanity and Homes Within Reach in January of
2020. The city has worked with both organizations in the past on affordable scattered
site housing projects, most recently in 2012.
Mr. Sargent reported the city will be receiving $91,000 in Community Development
Block Grant (CDBG) funds to be utilized between July 1, 2020, and June 30, 2021. The
funds can be used for Habitat For Humanity and Homes Within Reach projects,
including acquisition, rehabilitation, and in some cases, demolition. Owners of the new
and/or rehabilitated homes would need to adhere to income restrictions specific to the
program(s), equating to 60% of the AMI levels.
He stated the city has a couple of options to use the CDBG funds for 2020. The two
areas the city has historically dedicated the funds towards include the single -family
housing rehabilitation loan program and the scattered site housing program. The home
City Council Work Session February 18, 2020
Page 6
rehab loan program enables income-qualified residents to request loans to make
needed improvements to their homes. The scattered site housing program funds
would have to be used towards acquisition/rehabilitation, where the home would be
sold to an income-qualified individual or family. The city could pursue this option on
its own, or help support outside organizations such as Habitat for Humanity or Homes
Within Reach.
Hennepin County staff recently informed the city that the city has approximately
61,000 that it still needs to allocate from the 2019 CDBG funding cycle. In 2019, the
city allocated $30,000 towards the single-family housing rehabilitation loan program,
however that money was quickly used up, and there are still 11 people on the waiting
list in need of these resources. In 2019, no money was allocated towards the scattered
site housing program, since Hennepin County indicated that funds may no longer be
used for acquisition/demolition of structures.
For 2020, the city can disperse the CDBG funds in a couple ways. First, the city could
allocate the total $91,000 towards the single-family housing rehabilitation loan
program, along with the $61,000 left over from 2019. This would fund the program
with $152,000, which would most likely be able to help all 11 people on the waiting list.
Second, the city could divide the funds between the housing rehab and scattered site
housing programs. Staff is seeking direction from the City Council on how the funds
should be used. He stated the public hearing for the CDBG program funds will be held
on February 24, 2020.
President Hemken polled the commissioners on their preferences for use of the funds.
Council Member Frazier indicated he would like to focus on the single-family housing
rehabilitation loan program and the scattered site housing program that would aid in
the construction or rehabilitation of an affordable home for low -income families.
Council Member London recommended adding higher end housing to attract higher
income residents and/or using the funds for rehab loans for single-family homeowners
to benefit existing residents.
Council Member Hoffe expressed support for the scattered site housing program.
Council Member Elder and Mayor Hemken supported splitting the funds between the
rehab program and the scattered site housing program.
Mr. Sargent stated by allocating half of the $152,000 funds, about six families would
benefit by the single-family rehabilitation loan program. He stated the other half of the
funding could be used for a Habitat for Humanity house. Mr. Sargent stated the EDA
budget could supplement the scattered site housing program.
ADJOURNMENT The meeting was adjourned at 9:19 p.m. as there was no further business to come
before the Council at its work session.
Respectfully submitted,
New Hope City Council February 24,2020
Page 2
RESOLUTION 2020 26
Item 6.4
Resolution approving agreement between the city of New Hope and Home Free
for the 2020 Domestic Assault Intervention Project.
MOTION
Item 6.5
Motion waiving permit fees for temporary signs for New Hope Lions Pancake
Breakfast on April 26,2020.
MOTION
Consent Items
Motion was made by Council Member Elder,seconded by Council Member Hoffe,
to approve Consent items 6.1 and 6.5.All present voted in favor.Motion carried.
HOME FREE
AGREEMENT
Item 6.4
Mayor Hemken introduced for discussion Item 6.4,Resolution approving
agreement between the city of New Hope and Home Free for the 2020 Domestic
Assault Intervention Project.
Council Member Elder commented regarding the 15%fee increase.He noted the
rate was flat for the past three years.He stated Home Free is a dedicated partner
to the northwest metro in aiding persons of domestic abuse.
Mr.Tim Fournier,director of police,explained that funds are in the 2020 budget
to cover the 36,900 contractual arrangement.He stated the services provided by
Home Free greatly benefit the community.He introduced Elsa Swenson of Home
Free.
Ms.Swenson,Program Manager of Home Free,explained the funding increase
represents the cost of 5 full time equivalent legal advocate dedicated to the city of
New Hope.She reported that Home Free provides an immediate response to
domestic assault for victims in northwest Hennepin County,responding to over
100 incidents of domestic assault in the city of New Hope annually.She indicated
although the number of people served since 2016 has not significantly increased,
the advocates are working with people for a longer period of time and also deal
with a greater variety of issues mental health and chemical abuse).She also spoke
of the housing shortage and the need for safe housing.
Council thanked Ms.Swenson for the work provided by Home Free.
RESOLUTION 2020 26
Item 6.4
Council Member Elder introduced the following resolution and moved its
adoption:RESOLUTION APPROVING AGREEMENT BETWEEN THE CITY
OF NEW HOPE AND HOME FREE FOR THE 2020 DOMESTIC ASSAULT
INTERVENTION PROJECT.”The motion for the adoption of the foregoing
resolution was seconded by Council Member Frazier,and upon vote being taken
thereon,the following voted in favor thereof:Hemken,Elder,Frazier,Hoffe,
London;and the following voted against the same:None;Abstained:None;
Absent:None;whereupon the resolution was declared duly passed and adopted,
signed by the mayor which was attested to by the city clerk.
PUBLIC HEARING
2020 CDBG FUNDS
Item 7.1
Mayor Hemken introduced for discussion Item 7.1,Resolution approving
application for 2020 Urban Hennepin County Community Development Block
Grant CDBG)Program funds and authorizing execution of sub recipient
agreement with Urban Hennepin County and any third party agreements.
New Hope City Council February 24,2020
Page 3
Mr.Jeff Sargent,director of community development,explained the purpose of
the public hearing is to consider the projected use of CDBG program funds.He
stated the city is projected to receive 107,000 in 2020 of which 15%or
approximately 16,000)will be allocated for Public Service Activities.Similar to
last year,Public service agencies will apply for the funding directly through
Hennepin County.Taking into account the unspent 2019 grant funds of 61,000
and the 2020 allocation of 91,000,the city has a total of 152,000 to allocate to
eligible programs.He noted at the February work session Council discussed
resources for housing programs and Council expressed support for splitting the
funds between the single family housing rehab program and the scattered site
housing program that could aid in the construction or rehab of an affordable home
for low income families.
Council Member London recalled discussion at the work session regarding the
rehabilitation loan program for residents to make repairs to single family homes.
He noted Habitat for Humanity may not be prepared to undertake a project this
year.
Mr.Sargent stated the county has 11 people on the waiting list for the housing
rehab loan program and the 152,000 would likely satisfy the funding needs of all
the applicants.He stated he believes Habitat for Humanity is interested in
pursuing a project in New Hope for an income qualified family to live in New
Hope.
Mayor Hemken opened the public hearing for comments.There was no one
present to address the Council for the public hearing.
Council Member Frazier noted by splitting the funds between the two programs,
it allows the city to assist current residents and to attract new residents.
Mayor Hemken explained the housing programs have been successful and the city
will continue to retain options.
CLOSE HEARING
Item 7.1
Motion was made by Council Member Frazier,seconded by Council Member
Elder,to close the public hearing.All present voted in favor.Motion carried.
RESOLUTION 2020 27
Item 7.1
Council Member Frazier introduced the following resolution and moved its
adoption:RESOLUTION APPROVING APPLICATION FOR 2020 URBAN
HENNEPIN COUNTY COMMUNITY DEVELOPMENT BLOCK GRANT
CDBG)PROGRAM FUNDS AND AUTHORIZING EXECUTION OF SUB
RECIPIENT AGREEMENT WITH URBAN HENNEPIN COUNTY AND ANY
THIRD PARTY AGREEMENTS.”The motion for the adoption of the foregoing
resolution was seconded by Council Member Elder,and upon vote being taken
thereon,the following voted in favor thereof:Hemken,Elder,Frazier,Hoffe;and
the following voted against the same:London;Abstained:None;Absent:None;
whereupon the resolution was declared duly passed and adopted,signed by the
mayor which was attested to by the city clerk.
EXCHANGE OF
COMMUNICATION
Mayor Hemken introduced for discussion Item 12.1,Exchange of communication
between members of the City Council.