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Recommending the authorization and approval of the purchase of a $150,000 participation interest in the LISC CAT Fund for the acquisition of 964-968 Payne Ave, District 5, Ward 6
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WHEREAS, the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota (the “HRA”), is a public body corporate and politic established, existing, and operating under the laws of the State of Minnesota pursuant to the provisions of Minnesota Statutes, Section 469.001, et seq. (the “HRA Act”); and
WHEREAS, the HRA is empowered by law, including the HRA Act, to adopt and enforce this Resolution in pursuit of its mandate to engage in appropriate housing, development, and redevelopment projects; to remove or prevent the spread of conditions of blight or deterioration; to bring substandard buildings and improvements into compliance with public standards; to dispose of HRA-owned land for private development; and to improve the tax base and the financial stability of the community; and
WHEREAS, the civil unrest following the murder of George Floyd in May 2020 significantly impacted businesses and properties within the City of Saint Paul; and
WHEREAS, the HRA previously established a $1,000,000 Civil Uprising Budget in fiscal year 2021 to provide necessary business assistance through RES 20-1681; and
WHEREAS, a primary goal was to facilitate the transfer of properties in areas affected by the civil unrest to existing businesses, local residents, and community-based owners to foster economic empowerment and strengthen the community, particularly in light of the dual challenges posed by social unrest and the ongoing COVID-19 public health emergency; and
WHEREAS, the Local Initiatives Support Corporation Twin Cities (LISC) established The Community Asset Transition (“CAT”) Fund to offer adaptable and affordable financial resources specifically for the acquisition of commercial and residential properties within the impacted cultural districts; and
WHEREAS, on December 8, 2021, through RES 21-1775, the HRA allocated $500,000 of the Civil Uprising Budget to the LISC CAT Fund, and approved and authorized the HRA to enter into a Master Participation Agreement with LISC; and
WHEREAS, the HRA entered into a master participation agreement with LISC on October 2, 2023; and
WHEREAS, the executed Master Participation Agreement (MPA) established program guidelines for the CAT Fund "1.0"; and
WHEREAS, a subsequent iteration of the program guidelines, CAT Fund "2.0" (introduced in 2023), incorporated more flexible terms, including loan terms of up to ten years and eligibility extended to both non-profit developers and mission-aligned for-profit developers; and
WHEREAS, on February 13, 2025, LISC received a CAT Fund lending intake form for the acquisition of 964-968 Payne Ave from Georgia Fort, on behalf of 968 Payne LLC, for a total loan amount of $425,000 (“the Project”); and
WHEREAS, an amendment to the MPA is being recommended to be approved by the HRA on May 14, 2025, to adopt the CAT Fund "2.0" guidelines to accommodate the current project needs; and
WHEREAS, approval of the amendment to adopt CAT Fund “2.0” guidelines would allow the Project to have a loan term of 6 years and would allow the borrower to receive loan proceeds directly rather than through a nonprofit intermediary; and
WHEREAS, in conformance with the MPA, LISC determined the portion of the loan it would make (“LISC’s Retained Interest”) and the portion of the loan the HRA would make (“HRA’s Percentage Interest”), as well as the overall terms of the loan through their underwriting process; and
WHEREAS, HRA staff reviewed the Project and worked in consultation with LISC staff to screen the project in accordance with LISC’s Guidelines; and
WHEREAS, the Project vision by Ms. Fort to not only create a new headquarters for BLCK Press and the Center for Broadcast Journalism in the near term, but to explore ways to partner with community partners to activate the corner of a key intersection along Payne Ave and explore additional redevelopment opportunities on the property in the future, meets several public purposes in the Saint Paul Comp Plan and District 5 neighborhood plans.
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota, as follows:
1. The Board approves the purchase of a $150,000 participation interest in the LISC CAT Fund for the acquisition of 964-968 Payne Ave by 968 Payne LLC.
2. The loan terms will be 6 years and the HRA funds shall not bear interest.
3. The loan will be guaranteed by Georgia Fort and BLCK Press LLC.