HomeMy WebLinkAbout3.b. Home Improvement Loan Program .
�nV 1 P.O. BOX 510
✓iE� � 2&75-145TH ST. W.
O�Q�Ou�2 ROSEMOUNT. MINNESOTA 55068
G L 612-423-4d11
TO: MAYOR NAPPER, CITY C�UNGIL, GITY ADMINISTRATOR
FROM: TRACIE PECHONICR, ED SPECIALIST �TEM �� S
DATE: JULY 12, 1990 ITEM ��. J
SUBJ: MINNESOTA HOIISING FINANCE AGENCY
NEIGHBORHOOD PRE3ERVATION HOME IMPROVEMENT LOAN PROGR�iM
Attached is information on the MHFA Neighborhood Preservation HQme
Improvement Loan Program. ,The Dakota County HRA contacted staff
late in June regarding the City of Rosemount's possible desire to
participate in such a program.
The Neighborhood Preservation Loan Program is one which provides
property improvement financing with attractive-terms and conditions
as an incentive for neighborhood preservation activities. Eligible
neighborhoods are designated by cities and must meet basic criteria
established by the MHFA. Cities are expected to participate in the
program by designating neighborhoods and contributing to the total
neighborhood preservation effort (the cities must contribute 25%
of each loan / $1. 00 for every $4.00 from the MHFA) .
Overall, this looks like a,program that would be beneficial in the
expanded housing district (see map within application) set up by
the Dakota County HRA. It is likely that interest rates on these
loans will vary from 3� to 10.5% depending on the type of property,
applicant, ownership, occupancy, and loan size. The annual income
limits for this program appear to be quite reasonable: ' 1 or 2
persons - $45,000; 3 or more persons - $51,750. In addition," the
Dakota County HRA would act as the seller of the loans for the City
of Rosemount.
The Dakota County HRA recommended that the City of Rosemount
designate funds from previously approved projects within the Dakota
County HRA's Housing Tax Inerement Financing District for our 250
contribution (ie: funds designated for the demolition of the Doyie
house; street/sidewalk improvements, miscellaneous public
improvements, etc. ) . The attached application, listing previously
designated funds, has been forwarded to MHFA to see if this kind
of match will meet with their approval. This application can be
stopped, however, if it is determined that the City of Rosemount
should not participate in this program.
Please review the attached as Kari Gil1 of the Dakota County 'HRA
will be present at Tuesday's meeting to go through the application
in some detail and to answer any questions you may have.
Staff recommendation at this time: adoption of the ��Resolution
Authorizinq Submission of an Application for Funds for a
Neiqhborhood Preservation Home Improvement Loan Program through
the Minnesota xausinq Finance Aqency��.
.� .� /
UAKOTA COUNTY Housing&Redevelopment Authority
2496-145th St.W. • Rosemount,MN 55068 •612-423-4800• Fax 612-423-242?
July 3, 1990
Dean Johnson
Rosemount City Hall
2875 - 145th Street West
Rosemount, MN 55068
RE: NEIGHBORHOOD PRESERVATION APPLICATION TO MHFA :
Dear Mr. Johnson:
Enclosed is a copy of the Neighborhood Preserv�tion Application
submitted to the Minnesota Housing Finance Agency (MHFA) on behalf
of the City of Rosemount.
We indicated in the application that t`�e Rosemount City Council had
not yet taken action on approving this application but would
consider this at that their July� 17, 1990 City Council meeting.
If you can add this to the agenda for the July 3, 1990 meeting that
would be even better.
Please let me know what action is taken by the City Council so that
we can forward this information to MHFA. If it is approved, I
would need a copy of the certified resalution.
Sincerely,
� ; ���f
" r .,�7 � '� ��..f��
Kari R. Gill
Deputy Director
Enclosure
"AN EQUAL OPPORTUNITY EMPLOYEF"
, ,
, A. NEIGHBORHOOD PRESERVATION LOAN PROGRAM For MHFA Use Oniy
APP�ICANT DATA FORM
[Complete this form and attach it to the
front oi your Application For Funding.]
� Please type or print cleariy. (Date Received)
t. �'OR THE CJTY OF: Rosemount
2. BAIEF DESCRIPTfON OF NEtGHBORHOOD: Neighborhood improvement area
surrounding the downtown commerical district
3. TOTALAMOUNT OF MHFA FUNDS REQUESTED: $ 90,000
4. PARTICIPATION TERM FOR MHFA COMMITMENT
(Cannot exceed a twelve month period) FROM: 9-90 TO: 8-91
5. INFORMATION ABOUT THE ENTITY COMPLETWG THIS APPL1CA710N:
NAME OF QRGANIZATION: Tlaknta Cotmtv HRA -
ADDRESS OF ORGANlZATION: 2496 145th Street West
CONTACT PERSON: uaY; �;�i , Ellie Stark
TITLE: _ De�utv Director, Loan Officer
. PHQNE NUMBER: .. :423-4800
THIS APPLICATION IS SUBMITt'ED BY THE UNDERSIGNED WITH THE FULL KNOWLEDGE AND
CONSENT OF THE GOVERNING BODY OF THIS ORGANIZATION AND/OR UNIT OF LOCAL
GOVER ENT AND IS,TO TH �DERSIGNED'S BEST KNOW�EDGE,ACCURATE IN ALL DETAI�S.
� 'V V'i���
_ (signatu ) - �-2-90
{date)
FOR MHFA PURPOSES ONLY Score
A. the relative neighborhood preservation needs described in the proposal which needs may
include, but not be limited to, housing needs, the needs of commercial and public properties,
and infrastruciure;
B. the extent to which other resources are or will be allocated to address the stated needs;
C. the expected impact of the neighborhood preservafion aciivities;
D: the extent to which other conditions or resources exist for long-term p�eservation of the
designated neighborhood;
E. the extent to which low and moderate income residents will benefit from the neighborhood
preservation activities;
F. the extent to which displacement of residents will be minimized;
G. the geographic area to be serviced, the size of the request for funds or other factors that will
achiave a reasonable distribution of resources across the state;
H. the priority rati�g a city may assign to a proposal if the city submits more than one proposal;
�. the extent to which the proposal is more innovative than other proposals,
�. Other.
MHFA REVIEWER: DATE REVIEWED: TOTAL PQINTS:
B. The Rosemount City staff has requested that the Dakota County
ARA submit this applicatian on behalf of the City of Rosemount
and the item will go to the City Council for consideration at
their July 17th meeting. A copy of the Resolution will be
forwarded to MHFA once approved.
C. Neiqhborhood Profile• Central Rosemount �
As indicated in the attached map, the Neighborhood
Preservation Home Improvement Loan Program funds are targeted
for an area near the central area of Rosemount. This is
comprised of predominantly older single family owner occupied
homes with some multi-family and a downtown business district.
Substandard housing units/Section 8 Housing Quality Standards
definition used comprise an estimated 10-15% of the total
housing units. The average home in this area is 40-60 years
old with many being 70-90 years old. Home va7ues average
$50, 000-$70,000 as compared to the balance of the city where
this range would average $90, 000-$110, 000.
Commercial properties in the Neighborhood Preservation area
range from new to substandard condition as the city has done
same extensive redevelopment work; however, � many blighted
properties remain. The public infra-structure is in moderate
to good candition.
�
This area is part of he reqional Rosemount Town�shi� rea a an
is experiencing exte new development in the out
bordering areas. Continuous hou�i�x�hab fund targe ' is
necessary to avoid incre ing housing blighting conditions,
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D. NEIGHBORHOOD PRESERVATION NEEDS (ATTACH ADDITIONAL SNEETS, IF NECESSARY) EXHIBIT t '
NEED
PRIORITV NARRATIVE DESCRIPTION OF NEED EXTENT OF NEED (MEASURABLE CHARACTERISTICS)
-------------------------------------
The City of Rosemount identified the need to preserve the-`-""`--'-"'-'"-"'-'-"'-------- g
existing housing in this neighborhood in 1983 when this Some substandard dwellin units still exist which
� would benefit from housing rehabilation loans.
Neighbhood Improvement Area was established.
__ CDBG funds have been used to fund Housing Rehabilitation
------------
in this area an� ad�d�itiona�T-fun�s are'neede�'res's�rv�-------------------------------------------------
unmet needs.
--------------------------------------------
2 The Tax Increment funds will be used to acquire blighted residential units in the neighborhood;
These units will be demolished and the sites prepared for new development.
3 The City TIF. and EDA funds will be used to rehab or acquire blighted or non-conforming businesses;
One business will be relocated and one property will be rehabbed to standard condition.
IEXAMPLES)
9� REHABILITATION OF NQN-CODE COMPLYING RENTAL PROPERTIES 6 PROPERTIES CONTAINING 19 UNITS; APPROX. 80%
ARE OCCUPIED BY �OW INCOME TENANTS
-� 99 REMOVAL OF ISOIATED HOUSING IN COMMERCIAL AREA 3 S.F. UNITS SHOUlO BE PURCHASEO,
RESIOENTS REIOCATED, STRUCTURES RAZED
E• SOURCES Ar�O USES OF FUNDING (ATTACH ADOITIONA� SHEETS, IF NEGESSARV) •
EXHIBIT 2
NEEO TOTAL FUNOS AMOUNT BY SOURCE -0F IS THIS PART
PRIORJTV NEEDEO SOURCE • TYPE OF MONTH/YR VERIFICATION OF VOUR �OCAL
______________ PUNDS ASSISTANCE OF USE ENClOSE'0? CONTRIBU7ION?
------------------------- .
----'----------
--- -- ------ -------------
i
$90,000 $90,000 MHFA Loan 9/90-8j91- nTa nra--'-'_
2 $55,000 $55,000 *CDBG
•Housing Rehabilitatio 9/90-8/91 no no
It is ex ected that this amount will be used to loans
----------------P____________ make Housing Rehab Loans in this project area using County-wide
------------------------
* CDBG Funds or Program Income from earlier Rosemount�oan F'ro-raFns, an
---------
g addi�ioriar'6-'he��5tng:---------------------
3
$45,000 $45,000 TI Acquisition & 9/90-8/91 yes yes
Demolition of
---------------------- --.Suhstans�ard_ '
------------------------------
----------------- vn�.�.�----------
------------------------
4 $120,000 $40,000 City EDA Acquisition --""'
80,000 CDBG bemolition of
Substandard units 9/90-8/91 no no
--------------------
----------------
5 City EDA & Acquisition removal 9/90-8/91 no no
$385,000 City TIF and relocation of
blighted commercial pr.
s
�
s
9
�
(EXAMPLE$)
9� $ 150,000 S 100,000 MNFA NGHBRHO LN PRGRM
S 25.000 HUD RNT1. RHB PRGRM �OAN 1/91-f>/g2 N/A W�q
S 25,000 GITY GNRL F��f�, GRANT 10/90-t0/91 VES VES
----------------------------------------- SERVIGE 5/91
-----------------
99 - ,...-�----------------------------------------
S 200.000 S 125.Oq0 CITY EDA F1 ....CING VARIpUS 1I91-12/91 ---Np------------YES-----
S 75,000 CDBG b SEC� 8 SERvIGE g/gp-�y�gp �ES N�
NO
. . �. .�- �
p•
9/8/89
TIF DISTRICT ,�r2
COMPREHENSIVE BUDGET
A. Total : Interest Rate Reduction
Single Family - Interest Rate Reduction S 795 , 084 *
B. Lakeville - Senior Housincx
Costs :
Demolition . $ 250,000
Site Acquisition 856, 135
Arch/Engin/Prot Serv 246, 700
Util/Site Improvements 244, 014
Development Costs � 1, 990, 652
Reserve Fund 322� a�p
Interest on Principal 2, 600, 000
Contingency 105, 425
Bond Costs 124 , 425
SUBTOTAL $ 6,739,351*
C. Multifamily Housinq - Rosemount Condominiums
Costs:
Acquisition Costs $ 236, 100*
D. Rosemount West Area
Site Improvements/Preparation $ 175,000
Service Road Construction 100, 000
Trunk Storm Sewer Construction 105,000
Acquisition/Clearance 200, 000
Interest Rate Reduction� 1 , 000 . 000
$ 1,580,000*
��"/� E. Rosemount - Cameo Avenue
��
..�', Interest Reduction Assistance $ 50Q, 000
=' Land Acquisition 300, ODO
Relocation 30, 000
Demolition/Site Preparation 30, 000
Utilities 10, Od0
Public Improvements ' 10 , 000
sUaTOTr�, $ sso,aaa*
F. EXPECTED USES OF MHFA FUND$ •
(PROVIOE AN ITEMI2ATION OF THE EXPECTEO USES OF MHFA FUNOS, USING THE CATEGORIES lI5TE0.) EXHIBIT 3
SECTION I . ITEMIZATION OF FUNDS BY PROPERTV `
1 . FOR PROPERTIES WHICH ARE CONSIDERED REAL PROPERTY (NOT PERSONAL PROPERTV),, AND OWNED BY;
a) GENERAL APPLICANTS WHO ARE - ' �
- NATURAL PERSONS LIVING IN THE PROPERTv; $ ]2,000 *
- NATURAL PERSONS NOT �IVING IN THE PROPERTV; g iH�OOO *
- NOT NATURA� PERSONS: $ Q
b) OTHER APPLICANTS: $ 0
2. FOR PROPERTIES WHICH ARE CONSIDERED PERSONAL PRQPERTY (e.g. MANUFACTURED
HOUSING TAXED A$ PERSONAL PROPERTV), AND OWNED BV:
a) GENERAL APPLICANTS WHO ARE -
- NATURA� PERSONS LIVING IN THE PRQPERTV: g �_
- NATURAi� PERSONS NOT LIVING IN THE PROPERTv; g �
- NOT NATURAL PERSONS: � �
b) OTNER APPLICANTS: $ �
TOTA� MHFA FUNpS REQUESTED FOR NEIGHBORWOOD $ 90.000
------------------------------------- +
SECTION II. ITEMIZATION OF FUNOS BV APPLICANTS
FUNpS FOR GENERAL APP�ICANTS (the sum of i,a. and 2.a. , above) : g 90,Q��
FUNDS FOR OTHER APPLICANTS (the sum of i.b. and 2.b. , above) : $ (�
(MAV NOT EXCEED 25% OF TOTAL MHFA FUNOS COMMITTED)
TOTAL MHFA FUNDS R'EQUESTED FOR NEIGHBORHOOD: $ _9Q,OOO
,
DEFINITIONS OF APPLICANTS: ,.
GEN�RAL APPLICANT MEANS:
1. A LOW OR MODERATE INCOME PERSON OR FAMILV OCCUPYING A PROPERTY AS A ONE-UNIT PROPERTY; OR
2. A LOW OR MODERATE INCOME PERSON OR FAMILV TMAT OWNS THE PROPERTY', AND AGREES THpT THE PROPERTY WIL� BE OCCUPTED
PRIMARILY BY LOW' OR MODERATE INGOME RERSONS OR FAMILIES; OR
3. A NONPROFIT ENTITV, LIMITfD PROFIT ENTITV, OR COOPERATIVE NOUSING CORPORATION THAT PROVIDES RESIDENTIA� CARE
FACPLITIES OR DWEILING ACCOMODATIONS, AS APPROVED BY MHFA.
OTHER APPLICANT MEANS:
ANV ENTITV WH1CH DOES NOT MEET THE REQUIREMENTS OF A GENERA� APPLIGANT, BUT EXCLUDES BUILDERS AND FOWNHOUSE OR
GONDOMINIUM ASSOCIATIONS, OR $IMII.AR ORGANIZATIONS.
. * Any general applicant will be able ta use these funds for the improvements to real properCy in the amount
listed in the category above.
G. NEIGHBORHOOD PRESERVATION EXPECTED IMPACT (ATTA(:t� A�DITIONAL SHEETS, IF NECESSARY) '
EXHIBIT 4
NEEO
PRIORITV _NARRATIVE_DESCRIPTION_OF_EXPECTED IMPACT (USE MEASURABLE CHARACTERISTICS) �
--------------------------
------------------
It is expected that at least an additional 6 housing units will be rehabbed with these �-�----"---'-"
, funds. This program will allow Rosemount to continue its ongoing efforts to improve the
existing housing stock by providing funds for housing rehabilitation.
-----------------------------------------------
-----------------------
The tax increment dollars will be used to acquire some of the substandard homes and wi11
2 provide funds far the relocation of the tenants if applicable. In addition, the TIF dollars
will be used to demolish the properties, install public improvements, and make the properties
---------------------------------------------
-----------------------------------
available for new development. The combination of 1 and 2 will help to remove substandard -----
� conditions from the neighborhood.
4
5 ,
6
7
8
-------------------
9
(EXAMPLE5) •
98 ALL RENtAL UNITS WII.L 8E IN COMPLIANCE WITH RENTAI CODES; AFTER REHAB, 8 RENTAI. UNITS ( 2 PROPERTIES) WILL BE
SUBSIDIZED HOUSING; 6 UNITS ( 2 RROPERTIES) WILL 8E RENTED TO L-M INCOME TENANTS; CONVERSION OF 2�UNIT PROPERTV
INTO 1 RENTAL UNIS (t PROPERTY) WILL BE LARGE FAMILY RENTAL UNIT; THE TWO t-UNIT AND ONE 2-UNIT OWNER-OCCUPIED
_PROPERTV WI�L, AFTER-REHAO, BE AN EXCELLENT TRANSI7ION TO THE ADJACENT SFD SUBDIVISION.
- --------------------------------------------------------
99 ALL 3 PROPERTIE$ ARE NOT COMPATIBLE WITH SURRQUNDING LANp-USE; PROPERTIES CAN 8E INCLUOEO IN TIF AISTRICT; THE
TENANTS OF THE TWO RENTA(. HOUSING UNITS WIIL BE RE_OCATEO TO SUBSI�I2ED MOU5ING; THE OWNER-OCCUPANTS OF TNE
TMIRp PROPERTY WILI RECEIVE DOWN PAVMENT ASSISTANCE AND MOVING EXPENSES FpR A FECENTI.Y REHABBED HOME IN AREA,
CITY OF ROSEMOIINT
DAKOTA COUNTY, MINNESOTA
RESOLUTION 1990-
A RESOLUTION AUTHORIZING SUBMISSION OF AN APPLICATION FOR
FUNDS FOR A NEIGHBORHf?OD PRESERYATION HOME IMPROVEMENT LOAN
PROGRAM THROUGH THE MINNE3OTA HOU3ING FINANCE AGENCY
WHEREAS, the Minnesota Housing Finance Agency (MHFA) is soliciting
applications for a Neighborhood Preservation Home Improvement Loan
Program; and
WHEREAS, it is required that applicants contribute funds, property,
or services equal in value to at least 25% of the amount of MHFA's
commitment to purchase loans; and
WHEREAS, applicants must designate an eligible neighborhood and a
seller (lender) for this program; and
WHEREAS, the Dakota County HRA has experience in administering MHFA
Home Improvement Loan programs and could be the seller for the City
of Rosemount.
NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of
Rosemount, Minnesota:
1. The required matching funds are coming fram previously
approved projects from the Dakota County HRA's Housing Tax
Increment Financing District as described in Exhibit E of the
MHFA application.
2 . The eligible neighborhood is defined as the Expanded
Neighborhood improvement Area in the City of Rosemount:
3 . The Dakota County Housing and Redevelopment Authority (HRA)
shall be designated as the seller (lender) .
4 . The HRA is authorized to submit an application to MHFA for
Home Impravement Loans on behalf of the City of Rosemount.
THese funds must be utilized within one year. If the entire
amount of funds is used within the one year period, the Dakota
County HRA is directed to inquire about obtaining additional
funds from MHFA.
ADOPTED this 17th day of July, 1990.
Vernon J. Napper, Mayor
ATTEST:
Susan M. Johnson, City Clerk
Motion by: Seconded by:
Voted in favor•
Voted against•