Title
Approval of the May 8, 2013 HRA meeting minutes.
Body
ROLL CALL
Present: Commissioners Bostrom, Brendmoen, Carter, Lantry, Stark, Thune, Tolbert
CONSENT
1. Approval of the April 24, 2013 HRA meeting minutes.
Commissioner Lantry moved approval.
VOTE: Yeas - 7 Nays - 0
2. Resolution Approving and Authorizing Subordination of Three HRA Loans for Refinancing of the Sibley Park Apartment Project, Amendment of $750,000 HOME Loan Note, and Sale of $750,000 HOME Loan Note and of $250,000 HRA Loan Note to Sherman Associates LLC
Chair Thune pulled this item from the consent agenda.
Mr. Al Carlson, Acting Executive Director for the HRA, stated that new developments have occurred that could affect this action. Staff is asking for a one week layover in order to address the new information, and make adjustment to the proposed resolution if needed.
Commissioner Bostrom made the motion to lay this item over to May 15, 2013 at 3:30 p.m.
VOTE: Yeas - 7 Nays - 0
PUBLIC HEARING
3. Resolution Approving the Sale of Land and Converance of Parcel 629 Sherburne Avenue under the ISP/NSP Program, Thomas-Dale, District 7
Ms. Sarah Zorn from PED stated that this property was purchased in July 2009 under the Neighborhood Stabilization Program (NSP) and Rebuilding Plan 2009-2013. This is a two-story, three-bedroom, two-bathroom home built in 1884. The purchase price was $29,750 representing a discount of 29%. The sale price is $132,900 with a total development gap of $138,000.
Chair Thune announced the public hearing. There being no testimony, Commissioner Carter moved to close the public hearing and approve the resolution. Approved as set forth in resolution RES PH 13-97
VOTE: Yeas - 7 Nays - 0
4. Resolution Approving the Sale of Land and Conveyance of Parcel 719 Fuller Avenue under the ISP/NSP Program, Summit-University, District 8
Ms. Zorn stated that this property was purchased with NSP funds in July 2010 for $89,630. This is a 1,320 square foot home with three-bedrooms and one bathroom; it was built in 1905. The property is being sold for $135,000 with a development gap of $150,000.
Chair Thune announced the public hearing. There being no testimony, Commissioner Carter moved to close the public hearing and adopt the resolution. Approved as set forth in resolution RES PH 13-98
VOTE: Yeas - 7 Nays - 0
5. Resolution Giving Preliminary Approval to the Proposed Issuance of Lease Revenue Refunding Bonds for the Higher Ground Academy Project under Minnesota Statutes, Sections 469.152 through 469.1651
Ms. Jenny Wolfe, Project Manager for PED, stated that Higher Ground Academy was requesting up to $14,000,000 in conduit lease revenue refunding bonds. Higher Ground Academy is a K-12 public charter school which has operated since 1999 at 1381 Marshall Avenue, and currently enrolls approximately 730 students. The facility was financed with bonds issued by the HRA in 1999, 2004, and 2009.
Ms. Wolfe stated that the proceeds from the 2013 bonds will be used to refund the 2004 and 2009 bonds, plus provide an estimated $770,000 to purchase equipment, including STEM labs.
Ms. Wolfe explained that this is a conduit bond issue, and shall not constitute indebtedness, liability, general or moral obligation on the HRA or the City of Saint Paul, noting that the principle and interest on the bonds are payable solely out of the project revenues and other pledged sources.
Ms. Wolfe stated that Bill Wilson is the Executive Director of the School, but was unable to be at the meeting. Underwriter, Mr. Dick Ward from Dougherty and Company LLC; and Ms. Jenny Boulton from Kennedy and Graven as Bond Council were present.
Chair Thune stated he would abstain from the vote as his daughter is currently teaching at the school, and announced the public hearing. There being no testimony, Commissioner Carter moved to close the public hearing and approve the resolution. Approved as set forth in resolution RES PH 13-101
VOTE: Yeas - 6 Nays - 0 Abstain - 1 (Thune)
DISCUSSION
6. Resolution Endorsing and Approving the Proposed Changes to the Minneapolis/Saint Paul Housing Finance Board's Low Income Housing Tax Credit Procedural Manual for 2014 and Qualified Allocation Plan for 2014, Citywide.
Mr. Carlson stated that after much discussion at the last HRA Board meeting, and based upon that discussion and subsequent briefings with most of the HRA Commissioners, staff has made additional modifications to the scoring criteria.
Mr. Joe Collins from PED explained the changes as follows:
· Article IX (A) (7). This proposed amendment would increase the Selection Priority points from three (3) points to fifteen (15) points for a project that is located in a "non-impacted area" (as defined by HUD) in the City of Saint Paul or outside a Qualified Census Tract.
The rationale for this proposed amendment is to address community discussions about the overconcentration of affordable housing in "impacted areas" which have higher percentage of low-income residents. This proposed amendment encourages the development of affordable housing in "non-impacted areas" as defined by HUD.
· Article IX (A) (9). This proposed Selection Priority Points would reduce the Selection Priority Points from thirty (30) points to five (5) points for the preservation of existing affordable housing.
It should be noted that new construction projects will also be assigned five (5) points so that preservation projects and new construction projects are identified as having equal priority status.
· Article IX (A) (14). This proposed amendment would increase the Selection Priority Points from five (5) points to fifteen (15) points for projects that attract private financing. The rationale for this proposed amendment is to encourage affordable housing projects that have secured private financing as one component of the total financing package.
· Article IX (A) (18). This proposed amendment replace the words "existing development" with the word "property" in order to affirm that any property with an outstanding HRA/City debt obligation would receive (50) points. The proposed amendment supports projects in which HRA has a financial interest.
· Article IX (A) (19). This proposed amendment would allocate five (5) points for new construction projects. The rationale for this new selection priority recognizes that new construction of affordable housing have an equal selection priority status as preservation of existing affordable housing.
· Article IX (A) (20). This new selection priority of "walkability" promotes affordable housing that is located close to daily amenities, such as grocery, shopping, educational institutions, or day care so that residents of affordable housing can reduce their total monthly transportation costs.
Mr. Collins stated that staff is seeking approval of the stated changes. The Minneapolis/Saint Paul Housing Finance Board has scheduled a public hearing for May 15, 2013 at 10:00 a.m. in Minneapolis, and will consider approval of the Low Income Housing Tax Credit Procedural Manual and Qualified Allocation Plan for 2014 at that time.
Commissioner Bostrom stated that the Board has worked hard to preserve the existing affordable housing in the City, and it makes no sense to award 50 points to new projects when there are so many rehab projects that need to be done. Commissioner Stark stated that number 18 would award 50 points to projects which have an outstanding HRA/City debt, which doesn't necessarily mean a new project.
Commissioner Stark stated that staff did a nice job at making changes that reflect the complicated discussions of the Board. He also noted that there is a lot of pent up interest in new construction at this time, particularly along the Central Corridor. This is a unique time where the land costs less than it will in the future, and if affordable units aren't built in those areas today, then the City may never have the opportunity. He noted too that the Board will still need to rethink how to approach the criteria issue for next year.
Commissioner Lantry agreed that the Board should be have further discussions about the scoring criteria in the future. She also stated that it was her understanding that the Hamline Square project was the only project that was ready. Therefore, it makes sense to change the criteria for this round of Tax Credits.
Commissioner Bostrom introduced an amendment to number 18 which states: "Projects are located on HRA-owned land or housing developments in which the property has an outstanding HRA/City debt obligation"; and "An outstanding HRA/City debt obligation means debt outstanding on May 8, 2013 and includes credit for HRA/City debt on an adjoining property, if such adjoining property is: a) Under common control with the applying Project, and; b) Improves the security of or likelihood of future repayment of such debt."
Commissioner Bostrom moved approval of the amendment to number 18. Motion failed.
VOTE: Yeas - 2 Nays - 5 (Brendmoen, Carter, Lantry, Stark, Thune)
Commissioner Stark moved approval of the proposed, amended resolution. Approved as set forth in resolution RES 13-638
VOTE: Yeas - 6 Nays - 1 (Bostrom)
RECESS
Commissioner Lantry moved to recess. The HRA meeting was in recess until May 15, 2013 at 3:30