Title
Approving and authorizing an agreement between the Metropolitan Council and the City to clarify redeployment of Livable Communities Act program funds, citywide.
Body
WHEREAS, in 1995, the Metropolitan Livable Communities Act (“LCA”) was created to fund development projects that create affordable housing, increase economic opportunity, improve connections, and realize more equitable development outcomes; and
WHEREAS, the Metropolitan Council administers the LCA program by granting funds to cities and townships partnering with developers on specific projects; and
WHEREAS, since 2008, the Metropolitan Council has awarded approximately 70 grants to the City of Saint Paul under the Metropolitan Livable Communities Act program for approximately 36 different projects; and
WHEREAS, a subset of LCA grants awarded to the city are redeployed to developers as loans, particularly for projects utilizing low-income housing tax credits (“LIHTC”) to increase the eligible basis and generate more equity for the project; and
WHEREAS, grants deployed as loans have the potential to be repaid to the city; and
WHEREAS, historically, the Metropolitan Council has required the city to request permission to reuse repaid loan proceeds or to repay the funds to the Metropolitan Council; and
WHEREAS, on August 14, 2024, the Metropolitan Council approved business item 2024-210 to clarify the policy for reusing Metropolitan Livable Communities Fund grants deployed as loans that are repaid to the grantee (city) and provide more options; and
WHEREAS, this clarification allows the city to use repaid loan funds for affordable housing purposes without requiring explicit approval from the Metropolitan Council; and
WHEREAS, the city will report any redeployment of repaid funds as part of the annual Metropolitan Council Housing Production & Policy Survey already completed by Housing Division staff;
WHEREAS, the Metropolitan Council is seeking to amend prior grant agreements between the city and Metropolitan Council to reflect these new redeployment options by executing a document entitled Metropolitan Livable Communities Act Agreement Permitting Redeployment of Repayment Proceeds for Grant Funds as Loan Proceeds (the “Agreement”); and
WHEREAS, staff recommends City Council approval of the Agreement, which includes an exhibit listing 31 active loans; and
WHEREAS, the Metropolitan Council has included language in grant agreements to address the aforementioned redeployment options for future grant funds; and
WHEREAS, by this Resolution the Saint Paul City Council approves and authorizes execution of the Agreement.
NOW, THEREFORE, BE IT RESOLVED by the Saint Paul City Council that:
1. The Saint Paul City Council hereby approves and authorizes the execution of the Agreement between the Metropolitan Council and the City of Saint Paul.
2. The Interim Director of the Department of Planning and Economic Development, staff, and legal counsel are further directed and authorized to take all actions necessary to implement this Resolution. The proper officials are authorized to execute any documents in connection with this Resolution, subject to approval by the City Attorney’s Office.
3. Staff are directed and authorized to report on redeployed funds as part of the annual reporting process.