Title
Resolution amending the Homeowner Rehab Program Guidelines and the Downpayment Assistance (DPA) Program Guidelines, Citywide
Body
WHEREAS, the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota (the "HRA") is a public body corporate and politic established pursuant to the provisions of Minnesota Statutes, Section 469.001, et seq. (the “Act”); and
WHEREAS, the HRA has the power to engage in development or redevelopment activities under Minnesota law and the HRA is authorized to engage in activities relating to (a) housing projects and development, (b) removal and prevention of the spread of conditions of blight or deterioration, (c) bringing substandard buildings and improvements into compliance with public standards, (d) disposition of land for private redevelopment, and (e) improving the tax base and the financial stability of the community, and to engage in the aforementioned activities when these needs cannot be met through reliance solely upon private initiative and which can also be undertaken in targeted neighborhoods; and is authorized to create redevelopment projects as defined in Minn Stat Section 469.002, Subd. 14; and
WHEREAS, the attached program guidelines for a Downpayment Assistance (DPA) Program aim to aid in assisting low to moderate income households in accessing homeownership; and separate guidelines for a Homeowner Rehab Program aim to aid in assisting low and moderate income homeowners in making repairs to their homes; and
WHEREAS, the HRA, through Resolution 23-75 previously approved amended guidelines for the Downpayment Assistance Program on 1/11/2023;
WHEREAS, the HRA, through Resolution 23-79 approved amended guidelines for the Homeowner Rehab Program on 1/11/2023;
WHEREAS, staff recommends amending both the Downpayment Assistance Program and Homeowner Rehab Program guidelines to add a new Inheritance Fund Generational wealth area defined as the West Side flats displacement area; and a new Inheritance Fund Community Wealth area defined as the West Side, Planning District 3;
WHEREAS, staff recommends amending the Downpayment Assistance Program guidelines to require a pre-approval from a first mortgage lender as well as borrower income information when applying; and
WHEREAS, staff recommends amending the Homeowner Rehab Program guidelines to update the loan forgiveness policy so that there is no loan forgiveness in years 1-5; and that in years 6-15 the loan will be forgiven at an amortized rate of 1/10th annually. The overall forgiveness period will remain at 15 years. This change is accordance with federal funding requirements that do not allow for any forgiveness until after 5 years.
WHEREAS, staff recommends further amending the Homeowner Rehab Program guidelines to increase the minimum loan amounts for various homeowner rehab loans, as follows:
Increase the minimum loan amount from $1,000 to $10,000 for all loan types; except for emergencies, in which case the minimum loan amount will increase from $1,000 to $5,000
Increase maximum loan amount from $40,000 to $50,000 for typical home rehab loan and emergency loans;
Increase maximum loan amount for Generational Wealth (descendancy based) loans to $70,000 (i.e. a $20,000 Generational Wealth layer for both Rondo and West Side descendants)
For Generational Wealth loans with an additional Community Wealth bonus layer, the maximum loan amount remains identical at $80,000 (i.e. a $10,000 Community Wealth layer). As a result of this change, the Home Rehab Community Wealth layer will be the same size as the DPA Community Wealth layer
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota that:
The HRA Board of Commissioners hereby amends the guidelines to make the changes as described above
The HRA Executive Director, staff, and legal counsel for the HRA are further directed and authorized to take all actions necessary to implement this Resolution, so long as the actions are consistent with the intent of this Resolution. The HRA’s Executive Director or designee is authorized to execute any documents and instruments in connection with this Resolution.