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092396 EDA Official File Co~y -- CITY OF NEW HOPE EDA AGENDA EDA Regular Meeting #Y'J"/4 September 23, 1996 Agenda President Edward J. Erickson Commissioner W. Peter Enck Commissioner Pat La Vine Norby Commissioner Gerald Otten Commissioner Terri Wehling 1. Call to Order 2. Roll Call 3. Approval of Minutes of September 9, 1996 4. Discussion Regarding Request for Financial Assistance for Rehabilitation of Apartment Building at 7510 Bass Lake Road (Improvement Project No. 572) 5. Adjournment CITY OF NEW HOPE 4401 XYLON AVENUE NORTH HENNEPIN COUNTY, MINNESOTA 55428 Approved EDA Minutes September 9, 1996 Meeting #12 CALL TO ORDER President Erickson called the meeting of the Economic Development Authority to order at 8:16 p.m. ROLL CALL Present: Erickson, Enck, Otten, Norby, Wehling Staff Present: Sondrall, Donahue, Leone, McDonald, Bellefuil APPROVE MINUTES Motion was made by Commissioner Enck, seconded by Commissioner Otten, to approve the EDA minutes of June 24, 1996. All present voted in favor. Motion carried. The EDA agreed to consider Agenda Item 5 prior to Item 4. IMP. PROJECT 554 President Erickson introduced for discussion Item 5, Resolution Approving Item 5 Loan to Tasks Unlimited Lodges to Purchase 3579/3581 Independence Avenue North (Improvement Project No. 554). Ms. Sarah Bellefuil, Community Development Specialist; updated the EDA on the progress to date relating to the purchase of the property. She stated the City loan is for a $90,000 first mortgage, and if the loan is defaulted the City can foreclose on the property. Tasks Unlimited is also receiving a $90,000 second mortgage through the CO-OP Northwest Community Revitalization Corporation. Ms. Bellefuil noted that one of the garage units of the duplex will be converted into a recreation room and architectural plans will be presented at a future EDA Meeting. At Commissioner Norby's request, Mr. Craig Brett, Director of Vocational Services, explained the type of service and clientele who will reside in the special needs rental housing. He stated the clientele served by Tasks Unlimited Lodges are mentally ill persons who have been through programs and no longer need treatment but require support to remain healthy. Mr. Brett stated Tasks Unlimited provides housing, employment, and mental health support services. He stated a staff person is present daily on week days. EDA RESOLUTION Commissioner Enck introduced the following resolution and moved its 96-16 adoption: "RESOLUTION APPROVING LOAN TO TASKS UNLIMITED Item 5 LODGES TO PURCHASE 3579/3581 INDEPENDENCE AVENUE NORTH (IMPROVEMENT PROJECT NO. 554)." The motion for adoption of the foregoing resolution was seconded by Commissioner Wehling, and upon vote being taken thereon the following voted in favor thereof: Erickson, Enck, Otten, Wehling, Norby; 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. CAR-X/PUD President Erickson introduced for discussion Item 4, Discussion Regarding Item 4 Revised Request for Tax Increment Financing Assistance for Car-X/PUD Development at 7180 42nd Avenue North. New Hope EDA September 9, 1996 Page 1 Mr. Donahue, City Manager, explained that Mr. David Lasky is present to make a request of the EDA for financial assistance. President Erickson summarized the many changes made by Mr. Lasky as recommended by the Planning Commission and City Council including amenities such as a clock tower, brick versus wood on the clock tower, and the landscaping. He stated the changes have affected the cost of the development and Car-X, the proposed lessee, may not commit due to the higher prices. He encouraged the EDA to support the project to continue the 42nd Avenue redevelopment. Mr. David Lasky was recognized and explained how increased costs have increased the rent figure. Car-X was interested based on figures presented from the preliminary plan. Dialogue was exchanged regarding the development including the unusual contour of the property, tax increment financing district funds, and project size. Commissioner Enck expressed his opposition to the development especially an auto-oriented Car-X business. He encouraged Mr. Lasky to consider working with the City in pursuing the purchase of properties to the east for redevelopment of the entire area. He agreed that the configuration of the lot is difficult but combined with the other properties, it may be more marketable. Commissioner Enck questioned whether the community needs another muffler shop and retail space. He pointed out that the existing shopping centers have vacancies and are under utilized. Mr. Lasky explained that he has spent over two years marketing the property and the only industry which has expressed an interest has been auto-oriented businesses. City Attorney Steve Sondrall pointed out that the only issue before the EDA tonight is the financial request as the project was previously approved. Mr. Donahue stated the request is for $100,000 of assistance, present value, in the form of a grant. He explained that upon direction by the EDA, staff will prepare the proper documents for final approval at a future meeting. MOTION Motion was made by Councilmember Norby, seconded by Councilmember Item 4 Wehling, directing staff to prepare agreement for $100,000 financial assistance for approval at September 23, 1996, EDA Meeting. Voting in Erickson, Otten, Wehling, Norby; Voting Against: Enck; Absent: None. Motion carried. ADJOURNMENT Motion was made by Commissioner Enck, seconded by Commissioner Wehling, to adjourn the meeting. All present voted in favor. The New Hope EDA adjourned at 9:01 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA September 9, 1996 Page 2 ~ ~ EDA REQIJF~T FOR ACTION Originating Depmtment Approved for Agenda Agenda Section City Manager EDA 9-23-96 Kirk McDonald Item No. By: Management Assistant By: 4 DISCUSSION REGARDING REQUEST FOR FINANCIAL ASSISTANCE FOR REHABILITATION OF APARTMENT BUILDING AT 7610 BASS LAKE ROAD (?RO.T~.C? 572) The owners of an 11-unit apartment complex at 7610 Bass Lake Road are requesting consideration by the EDA of a loan to rehabilitate the building. The building is in need of rehabilitation and has received citations from the Inspection's Department. There have also been some problems with some of the tenants in the building and the Police Department has been called to the site on several occasions. The owners of the building are trying to make efforts to correct these problems. The owners have submitted the enclosed list of proposed improvements with cost estimates for each item. They state that the improvements are needed to attract more quality tenants and complete some crucial deferred maintenance. They also state that they have begun and will continue to use screening services for all future rentals. The Inspection's Department has reviewed the list of proposed improvements and is in agreement with the items listed. The total cost of the improvements is $48,775. The owners have already completed several of the improvements at a cost of $7,175, and they are requesting consideration of a Iow or no interest loan in the amount of $41,550 to complete the improvements. They are proposing to pay the loan back over 100 monthly payments of $415.50 each (assuming no interest) beginning 11 months after the loan is completed. The major improvements include: new roof, installation of new security doors/security, system, installation of new fire alarm system, installation of bathroom vents, replacement/repair of windows, replacement of some cabinets, appliances and floor coverings, repair and resurface of parking lot and concrete walks, and installation of outdoor electrical plug-ins (no garages on site). MOTION BY SECOND BY TO: Review: Administration: Finance: Request for Action Page 2 9-23-96 In 1993 the EDA established a loan program directed at maintaining multi-family rental housing. The purpose of the program is to assist owners in obtaining necessary capital for property rehabilitation and upkeep, to provide safe and decent housing opportunities at affordable prices, and to target public resources to reverse property deterioration and improve property values to enhance public safety within the community. The EDA approved a rehab loan for New Hope Apartments under this program in 1994 and that project will be completed this fall. The program stated that the following policies would be used by the EDA to evaluate potential requests for financial assistance by rental unit owners: · Minimum amount of public funding shall be provided in each case. · Priority given to basic need improvements (roof/wiring/heating), as opposed to provision of amenities. · At least two bona fide bids, from non-related parties, are required for each item that is a part of an overall program of rehabilitation. · No funds are provided to address defaulted mortgages or to bring taxes current. · Public funds will be used to leverage private funding wherever possible. Normally a 50~50 matching of funds for eligible activities would be required. · Wherever possible, loans shall be used as the preferred financing vehicle, rather than grants or equity investments. · In cases involving substantial financial stress, appropriate participation by the lender and equity owner is required for City investment. · Public funds will only be provided in those instances in which they are essential to rehabilitation of the project. Public funds will not be provided when the primary result of that provision would be to merely raise the profitability of a building. · Public funds will not substitute for private funding that may reasonably be raised in the private market. · No funding will be considered for approval without prior objective financial analysis of the project, along with an independent recommendation as to the amount and type of proposed funding. City staff met with the apartment owners and explained the policy guidelines to them. This proposal does not meet the 50~50 match requirement. The $7,175 investment made by the owners to date represents only 15% of the total improvements and the owners state that they have no funds to contribute for an additional match. Staff is supportive of getting the improvements made, but is concerned that the proposal does not meet certain program guidelines. Staff requests direction from the EDA on this request as to whether staff should continue working with the owners on an agreement or not. The owners of the apartment may be present at the EDA meeting. (If the EDA is not supportive of this request, Hennepin County has just implemented a new Rental Rehabilitation Loan Program and staff would encourage the owners to apply for that program.) September 3, 1996 Kirk McDonald New Hope City Of' 4401 Zylon Av. N New Hope, MN 55428 ... Regarding: 7610 BaSs Lake Rd.; Improvements needed, and desired method of paying for said improvements based on preliminary discussions with you, Jean Coone, and city attorney Steven Sondrall. Dear: Mr. McDonald Following is a list of improvements which are much needed to bring this building to a desirability level so as to attract more quality tenants, and complete some crucial deferred maintenance items. 1 .New roof; -- 5,500.00 2. New cabinets purchased and installed in five of the units 5x$800.00 ---~--4, 000. 00 ' 3. Install ceiling fans in each bathroom 1 lx$275.00 3,025.00 4. Replace 1{} aPartment windows 16',( $250.00 4,000.00 5. Install new hallway windows 4x$600.00 . 2,400.00 6.1n~tall new window~ in each bathroom 11x $150.0G _1,650.00 7.Repair all remaining windows not replaced 24x$50.00 _ - 1,200.00 8. Repair, resurface, and stripe parking lot 1,480,00 9. Install outdoor electrical plug-ins for each apartment- ...... 2,100.00 10.Replace concrete walks to building front and back-- 750.00 Il.Replace 7 refrigerators, 7x$425.00 2,975.00 12. Replace 11 gas cooking stoves 11x$225.00 2,475.00 13. Replace front and back doom (security type) 6,(XX).00 14.Install new fire alarm system.-- 3,800.00 15. Remove overgrown bushes (bees) from edge of foundation replaCe w/rock/shrubs- 1,500.00 16. Kitchen floor covering 2 units 2x$250.00. 400.00 17. Carpet 3 units 3x$750.00 ....... 2,250.00 18. New washer and dryer, $1,150.00 1,150.00 19. Repaint hallways and laundry room- 900.00 20. Recarpet steps and hallways 800.00 21 .Repair bathroom in # ~ 400.00 Total cost of improvements. 48,775.00 Items paid prior to loan. #,s 1,21 and 3 of the 6 refrigerators(# 11). 7,175.00 Amount needed to complete improvements. 41,550.00 We propose to pay this back over 100 monthly payments of $415.80 each, beginning 11 months after the loan has been taken down. We have now begun, and will continue to use screening services for ALL FUTURE RENTALS. Sincerely, Earl Norwood And Robert Engelking ~, 58 H AVE '7~5oo COUNTY ~ ~ebl e~ ~ SA RAPHEL . -' ~ ee~ ~ CATHOLIC ~ EL~ CHURCH GROVE, ST, RAPHAEL ~" 878.7 X ,0 886.4 q 897.5 896.4 .............. HOUSING CONDITION REPO_RT &d~ess ,~-,, Date ~ -~-= ~=:~ ~c phcr. e ~f ~cui'sr "for .... .~.~ ~w=':. ~Ss~. ~ur~cses). _ heatin~ system evaluated ~*'o~ mechanical or ~bg. & ht~. contractor. ?e~alr f - ion 7rcvi.ie storms and ~.re~,.s for all ovenacle..,~'indcws,., which rare in ~ood condit (unable to check interior -.ir. do'~s to see if operating smoothly due to wit. to> vea~ ,I. rotted floor of sink base cabinet. :arch wall under kitch, sink. ~air cabinet frame, base cabinets, and install door. ~a~ gap betw. backsolash and wall ~countertop) ~ose carpetzn~ a~ ~ltcn. ~nresn to min. area~ - cnntinued.. · ocCon,act Ot~ity B~lin~ - ~33-1521 Bxt. ~ina~ intozioz mete~ =eedin9 - 2 days pzio~ to move n cf~c~~~~please cal~ 533-~521, Ext. ~24, for ri-inspection. De~e F~e and Sa£e~y ~  City of New Hope - 4401 Xylon Ave. N. - New Hol~, MN 55428 - (612)531-5100 H~8 C~m~ffon Rq~,.t m~ ~mphnce O~e. ~ 2 of ..J A~FeS~ 7610 Bass' Lake. RRad Da~ 12/20/95 apt. #1, continued . . A~O Restore closet doors to tracks, both bedrooms.  Properly repair wall (sheetrock) in corner next to access to tub t' ~ Repair toilet (fl. valve?) ~0 Repl. sheetrock trim wround bathroom wndv. ~--~ q j~crape and paint ~ooa ~rim a~o~na oa~h w~naow. ~Repl. bathroom door. ~Repalr tub faucet to 8Au~ off. "' ~ ~ v/Repl, fixt. globe, bathroom. /~Pro~erly repair vall, R - bedroom. ~ · ~Secure elect, recept. Cna~e f~ush to .all) - ~ ~~. ~anin~ base molding - L bedr~. ep. ~ub stopper ~Rep. tub faucet ~ ~p 1~. Apt ~~ep/Repl.. paosa~ loek~d~r~ob. ~ Repair cabinet d~rs, b~e cabinets. ~ CO~~ONS ~ B~N ~ PL~E C~LI. 531-51~ ~R ~-~SPE~ON Ci~y of New Hol~ - 4401, ~Xylon Ave. N. - New Hol~, MN 55428 - (612)531-5100 ~dm~ 7610 Bass L~e. Road Da~ ~2/20/95 Apt. ~, continued . . . ~Rep. loose ~oo~kno~, L bedroom. ~ ~Repair faucet, ~v. ' n . ~ ( ~ ~Properly repair ~athro~ ceiling. I ~/AdJuat self-closer or rep. door to close & l&tch. t ' ~ ~ Repl. soap .~ish or ceramic tiles ~ tub wall I ~ ', Secure lay. to wtll. ~ ). lay. faucet | · ~Jo~uRepl. closet door, L bedroom. ' .' ~-~ linen c lo,e-t door. Fill ~ap behin~ b&ckspl&lh, kitchen countertop. ! ~Replace switch for ki~ch f~u. (repair faa if needed) I Apt. #6. %recast tod~v) . ./Repair/~A~ult door to cloee & latch. ! O~ ~ecure/connee~ curer ~or nea~ uar - Axv. arch bedroom door. ~ · Ad~ust/re~air ~c~r ~ close & lathh. . ~t/~_Pr°perl~'~':-~'~ liv. rm. ~. ~formmr patch.poor ~ob) epair R, bedroom d~or (pat ch hule) ~ ~ Rep. screen, t bedroom. · ~ CO~~ON~ ~ B~N ~ ~R C~ 531-5127 ~R ~-~PE~ON continued · · ·~ ~~aO~ I I I City of New Hope - 4401 Xylon Ave. N. - New H6pe, MN 55428. (612)531-5100 Housh~ ~.omlitton Report and Compilauce Orde~ l~ge A~rcss 7~10 ~ass Lk. Rd. Da2 12/~0/95 Apt. ~ continued... Secure smoke detector Wo wall. ' .~0 ~ de, air tub faucet ~ Repl. tile at tub faucet wall and under !ay wall. ~ ~roper~4~ .repalr~w~i - --i~. rm. ,~r A/C · / .~ I · ! ¢/~° ~Ju.t/re~air door to clo.. ~ latch. I ~ ~ Repair door trim at entr~. ~.' _~.~ Repl. ~saing liv. ~. screens ~D screen ~ ~ E~g/Inst~ ~1 bedr~ closet ~ ~ Re, air kitchen cab~ d~rs ~d drawer ~ ~- ~DI~LY p~e ~rking ~ke ~ete~. (ele~ric) Apt. v 'Patch ltv. ~. eeiltn$. -I ~ ~ ~ ~nplu8 ~e - tub dm~n. ~ ;~~~e tiles behind toile% WHEN CORRECTIONS HAVE BEEN MADE, PLEASE C~,H. 531-5127 FOR RE-INSPECTION , con~xnaaea... CC,[vir__ .,~!/.~.~.,,. -'-'. ~ '~--'l'b: --- ~ City of New Hope - 4401 Xylon Ave. N. - New Hope, MN 55428. (612)531-5100 Housing Condition Report and Compliance Order Page ~ of ' J Address 7610 Bass Lake. Road Dam 12/20/95 EXTERIOR: Repl./Rep. front light fixture ~ EXTERIOR SHINGLES ARE ORIGINAL. MUST BE ROOF A BUILDING PERMIT IS REQUIRED. ANY COP~MECTIONS WHICH WILL BE C0~PLETED BY T~ BUT~R, MUST BE ACXNOWI~DGED BY SIGNING AG~mM~IT ATTAcheD HEKEWITH. IF BbX~.R tS TO COMPLY, I~T":RIOR CORRECTIONS MUST BE COMPLETED WITHIN 60 DAYS AFTER CLOSING. RE-ROOF BY JUNE 15, 1996. WHEN CORRECTIONS HAVE BEEN MADE, PLEASE CAIJ., 531-5127 FOR RE-INSPECTION City of New Hope Apartment Loan Program ' EDA Resolution NO. 93-13 Purpose In September of 1993, the New Hope Economic Development Authority established a loan program directed at maintaining multi-family rental housing. The program appeals to the City's over 3,839 multiple rental units and focuses on three fundamental areas. First, it assists owners in obtaining necessary capital for property rehabilitation and upkeep. Secondly, it provides safe and decent housing opportunities at affordable prices for residents now and into the furore. Lastly, by targeting public resources in areas of greatest need the program reverses property deterioration; thereby improving overall property values and e .nhancing public safety within the community. Policy Guidelines 1. In view of limited public financial resources, the program provides minimal assistance to the greatest number of projects, with foremost attention to those properties in the greatest need. Basic need improvements such as: roof replacement, wiring and heating or other mechanical repairs carry a higher funding priority. 2. Loans shall remain the preferred financing vehicle as opposed to grants or equity investments. A 50/50 matching of funds is a normal requirement for eligible projects. 3. No funding is provided which, directly or indirectly, is used for fees by the owner or related parties (including construction management fees, developer fees, use of "contingency funds," fee sharing, etc.) 4. At least two bona fide bids, from non-related parties, are required for each item that is a part of an overall program of rehabilitation. 5. No funds are provided to address defaulted mortgages or to bring taxes current. 6. In cases involving substantial financial stress, appropriate participation by the lender and equity owner is required' for City investment. Participation may take the following forms: debt forgiveness, additional equity investment, interest rate reduction, loan term extension, payment deferrals, management fee reduction, reduced cash flow distribution, or other good faith efforts on behalf of the leader and property owner. 7. Public funds will only be provided in those instances in which they are essential to rehabilitation of the project. Public funds will not be provided when the primary result of that provision would be to merely raise the profitability of a building. 8. Public funds will not substitute for private funding that may reasonably be raised in the private market. 9. Each financial assistance agreement will contain an accelerated repayment provision in the event of property sale, or other significant changes in circumstances. 10. Funds will not be provided to allow the owner to displace moderate income residents and attract higher income tenants. EDA rehabilitation funds may not but utilized in such a way that relocation statues and payments are triggered. 11. Funds will not be provided for projects that would result in lower property tax payments, unless such projects meet other City objectives. 12. No funding will be considered for approval without prior objective financial analysis of the project, along with an independent recommendation as to the amount and type of proposed funding.. Additional Information For additional information or clarification on this program contact the following individuals: Kirk McDonald Management Assistant/Community Development Coordinator City of New Hope (612) 531-5119 Sarah Bellefuil Community Development Specialist City of New Hope (612) 531-5137 G: planning~housingJaptprg EDA RESOLUTION NO. 93-[3 RESOLUTIOI~ APPROVING MULTI-FAMILY HOUSING POLICIES (PROJECT//510) WHEREAS, the City of New Hope contains over 3,839 units of rental multiple unit housing; and WHEREAS, many of those units have been constructed during the period from 1960 to 1979; and WHEREAS, many of those units have begun to show signs of aging and obsolescence; and WHEREAS, many private owners are having difficulty obtaining private capital necessary to rehabi(itate and properly maintain their units; and WHEREAS; many of these rental housir~g projects have beer~ subjected to the real estate recession that has involved most of the United States as well as the metropolitan area; and WHEREAS, this housing stock, if maintained, can provide a decant, safe, and desirable source of affordable 'housing for the current and future residents of New Hope; and WHEREAS, the City of New Hope Economic Development Authority (EDA) has a desire to provide assistance where that assistance is clearly needed and warranted; and WHEREAS, the purpose of that assistance would be to: stem physical property deterioration, improve public safety, improve values, enhance neighborhood cohesiveness, and assist in the provision of modern rental amenities; and WHEREAS, the City of New Hope must target its limited resources, reflecting the reality that it can provide · only limited funding, compared to the funding that might potentially be required to renovate a significant percentage of the 3,839 multi-family rental units in the City; and WHEREAS, the goal of the EDA's involvement would be to meet public policy needs in the housing and human services area, rather than to resolve project financial problems and issues that private owners and lenders may have, and WHEREAS, the EDA recognizes that financial assistance to real estate projects involve Some risk. NOW THEREFORE BE IT RESOLVED that the following policy shall be used by the EDA to evaluate potential future requests for assistance by rental unit owners: 1. The minimum amount of public funding required shall be provided in each case. 2. Funding priority will be given to basic needs (such as roof replacement, wiring, heating, etc.) as opposed to provision of amenities (such as washers and dryers in each unit, new office and lobby furniture, etc.) 3. No funding will be provided which, directly or indirectly, is used for fees by the owner or related parties (including construction management fees, developer fees, use of ... "contingency funds", fee sharing, etc.) 4. At leaSt twd bona fide bids, from non-related parties, will be required for each item that is a part of an overall program of rehabilitation funded partially or completely with City funds. Normally, "in house" contracting and/or related party contracting will be prohibited. 5. No fuhds will be provided to bring defaulted mortgages current. No funds will ~be provided to bring taxes current. 7. Public funds will be used to leverage private funding wherever possible. Normally a 50/50 matching of funds for eligible activities would be required. 8. Wherever possible, loans shall be used as the preferred financing vehicle, rather than grants or equity investments. 9. In the case in which a project has substantial private financial stress, appropriate participation by the lender and the equity owner will be a requirement for City investment. The private investment may take the form of additional equity, debt forgiveness, interest rate reduction, loan term extension, payment deferrals, management fee reduction, reduced cash flow distribution, etc. In no case will tax funds be used to solve financial problems that would otherv~ise be solved privately in the absence of public participation. 10. Public funds will only be provided in those instances in which the public funds are essential to the rehabilitation of the project. Public funds will not be provided when the primary result of that provision would be to merely raise the profitability of a building. 11 .' Public funds will not be substituted for private funds that could reasonably be raised in the private market. For example, if a private loan could be obtained, and/or if Iow income tax credits would be available, EDA funds will not be used to displace these other potential resources. 12. Each financial assistance agreement will contain an accelerated repayment provision in the event of property sale, or other significant changes in circumstances. 13. Funds will not be provided that will allow the owner to displace moderate income residents and attract higher income tenants. Nothing in this statement shall be construed to preclude the attraction of desirable tenants to a project, and the displacement of undesirable tenants. 14. Fun~ls would not be provided for projects that would result in lower property tax payments, unless such projects meet other City. objectives. 15. EDA Rehabilitation funds shall not be provided for use'in such a way that Relocation statues and payments are triggered. 16. No funding will be considered for approval without a prior objective financial analysis of the project, and an independent recommendation es to the amount and type of proposed fundin, g.. Adoptedby the Economic Development Authority in and for the City of New HoPe this 13th day of September, 1993. Attest= Executive Director 'Daniel J. Doriehue, DATE: September 13, 1996 TO: . Suburban Hennep.'.m/County Communi.ties FROM: Barbara Hayden, Admini~tive Manager SUBJECT: Rental Rehabilitation Loan Program During the past year, many suburban Hennepin County communities have expressed a need for added resources to address multi-family rental property rehabilitation. The Hennepin County Board allocated $350,000 in federal HOME funds to establish a rental rehabilitation loan program. Enclosed is a marketing brochure for this new program. The program is available only in suburban Hennepin County and is being implemented on a pilot basis. Applications will be considered on a first come, first served basis until all the funds are committed. Due to limited funding, the initial outreach effort is being made through the suburban cities rather than through any broader media campaign. Please make this information available to your city property inspectors, local multi-family property owner groups and any other interested potential participants. Applications are now being accepted and can be obtained by contacting this office. Please contact Rod Waara at 541-7088 if you or potential applicants have any_ questions about the rental rehabilitation program. U:~FO~ Hennepin County Orcfice of Pls~,ning & Development, Development Planning Unit, 10709 Wayzata Boulevard, Suite 260, Minnetonka, MN 55305 Mall Code: 604 Phone: (612) 541-7080 Fax: (612) 541-7090 Rental Rehabilitation Loan Program Organizations (CHDO's) and HRA's · Twenty percent (20%) of the units owning the property to be improved assisted must meet the following .. The Hennepin County Rental are eligible applicants. Owners must rent requirements: Rehabilitation Loan Program is funded have equity in the property and the through the federal HOME Investment building must demonstrate a positive Efficiency ! .B.R. 2 BR 3 BR 4 BR Partnership (HOME) ' Program. The cash flow after rehabilitation. $360 $474 $605 $710 $791 HOME Program is designed to increase the supply Of decent, safe, Eligible Improvements These units must be occupied by sanitary and affordable housing for households with gross annual lower income families. The goal of Improvements may include the incomes that do not exceed 50 the Rental Rehabilitation Program is .to rehabilitation of existing rental housing .percent of the area median improve and maintain the multi-family units or conversion of existing income. For a three-member housing stock in suburban Hennepin buildings to rental housing. The household the current income County. construction of new housing units is i/mit is $24,550. not eligible. Eli_clible Properties Annua#¥, for the applicable term Income and Rent Requirements of the loan, the owner shaft Properties that have received other provide tenant rent and income federal subsidies for construction or The following rent and income information on designated rehabilitation (i.e., HUD rental guidelines must be met for a period of , assisted units. rehabilitation, public housing five years or through the ten-year term modernization, PHA owned or leased of the loan, if the property is financed The program administrator can projects, etc.) are not eligible for this with an FHA insured mortgage, provide more specific rent and program. Properties mustcontain five income requirements based on or more housing units. The gross · Eighty percent (80%) of the units specific projects. Rent and income area of buildings must consist of 51 . assisted must meet the following limits are periodically adjusted by percent or more residential space, rent requirements: the U.S. Department of Housing and The property must be located in Urban Development (HUD). suburban Hennepin County. Efficiency I BR 2 BR 3 BR 4 BR Properties located in Minneapolis are $369 $474 $605 $820 $928 A~ailability of Funds not eligible for assistance under the suburban Hennepin County program. These un/ts must be occupied by .Applicants will be processed on a first- households with gross annual come first-served basis, as long as Eligible Applicants incomes that do not exceed 60 .' loan funds are available. A complete ~ percent of the area median application must be~'submitted and Private individuals, corporations, income. For a three-member approved in order for funds to be partnerships, nonprofit organizations, household the current income reserved. Community Housing Development limit is $29,500. Financing Terms Tenant Selection Criteria Assistance will be provided in the form Prope~ies assisted, with Rental of a loan. The loan will. bear 3 Rehabilitation Loans may not refuse percent simple interest per annum, leasing to holders of Sec[ion 8 with principal and interest due ten certificates or vouchers solely on the' years from the date of the loan or status of the prospective tenant as a upon sale or transfer of the property, holder of such a certificate or voucher. whichever occurs first. Owners may apply consistent and reasonable financial and tenant history The Rental Rehabilitation Loan will criteria in screening prospective provide the project with up to 80 tenants. percent of the eligible rehabilitation cost. The maximum loan amount is How to Ar)ply $150,000 or $14,000 per unit, whichever is less. The minimum For a complete Rental Rehabilitation HOME loan amount is $25,000. Loan application package contact the Hennepin County Office of Planning RENTAL REHABILITATION Rehabilitation Standards and Development, Development Planning Unit, 10709 Wayzata 3% LOAN PROGRAM Property must meet Section 8 Housing Boulevard, Suite 260, Minnetonka, MN Quality Standards (HQS),* as 55305. Phone 541-7080. NO LENDER FEES established by the U.S. Department of SUBURBAN HENNEPIN 'COUNTY Housing and Urban Development (HUD), and Hennepin County Rehabilitation Standards upon Hennepin County Office of Planning and Development, Development Planning Unit completion of the rehabilitation. 10709 Wayzata Blvd, Suite 260 Properties must also be brought Minnetonka, UN 55305 toward compliance with State Energy Efficiency Standards. Property inspections will be conducted to assure compliance with HQS requirements for, a minimum of five Equal OpportunityHousing years.