The action at September's board meeting centered around the draft of the 2012 Affordable Housing Plan and funding awards made for programs that do not fall under Minnesota's joint "Super RFP" process. In addition, announcements about bonding and staffing were made.
Bonding, Deputy Position
As a lead-in to the meeting's agenda, Commissioner Mary Tingerthal mentioned that she was meeting with a group of housing advocates and developers seeking a common position on promoting housing bonding at the 2012 legislature. Tingerthal added that she was still uncertain whether Governor Dayton would propose a bonding bill at all, due to the state's dire financial situation. Following up from last month's discussion about staffing in light of the resignation of Deputy Commissioner Patricia Hippe, Tingerthal said that she would seek to appoint someone to the Deputy position, and expected to have a job description out by end of September.
2012 Affordable Housing Plan
In presenting the draft 2012 Affordable Housing Plan, Commissioner Tingerthal reminded the board that due to uncertainty in the financial markets, the Plan this go-round would be for a single year, rather than for a typical two-year period. The agency will proceed with drafting the 2013 plan over the summer. For both the 2012 and 2013 plans, Tingerthal stated that the emphasis will be on preserving the affordability and quality of the current subsidized housing.
The Affordable Housing Plan serves as the business plan for the agency and shows the investments the agency will make in the year starting October 1, 2011. Some of the notable initiatives in the 2012 plan include the new demonstration deferred loan rental rehab program (described below), a plan to provide tax exempt financing for rental projects sponsored by other government units, a program to provide rehab loans to home owners with good credit but negative equity, and a reorienting of the use of a portion of federal HOME dollars to subsidize the repair and preservation of existing subsidized rental housing.
Board member Barb Sanderson asked about the place of manufactured homes in the agency's housing plan. Sanderson said that there were many unsafe trailer homes in rural Minnesota. Tingerthal responded that the agency was participating in the cooperative purchase by residents of manufactured home parks. Individual homes can access the agency's Fix-Up Fund. Tingerthal added that the agency was looking at a mobile home "cash for clunker" programs found in other states.
The Affordable Housing Plan, with community comments, will be back before the board for adoption at the October meeting.
Funding Awards for Counseling and Rental Assistance
With the legislative session concluded, the agency was able to award state appropriated funds for programs that were not part of the "Super RFP" process. This month the agency awarded counseling and rental assistance funding.
The board passed the staff's recommended allocation of housing counseling funds (the HECAT program). In presenting its recommendations, staff informed the board that counseling programs have been funded by the agency since 1993, in which time 100,000 Minnesotans have received counseling support. Staff said that 53% of the resources would go for foreclosure counseling and 45% for pre-purchase counseling (with the remaining 2% for special projects).
In approving funds for rental assistance, the board was reminded that due to declining state resources fewer households would be assisted than in the prior biennium. They said that 148 fewer people would receive rental assistance. In total $10,757,000 was awarded to 33 organizations.
Rental Rehab Deferred Loan Pilot
Staff received board support for the new rental rehab deferred loan pilot program. Through this program, the agency would make deferred repayment loans to nonprofit and public agencies so that they can either rehab projects they own or relend the money to property owners in their service area. The maximum per unit loan is $25,000, and the maximum per property loan amount is $300,000. Funds will be awarded to non-profits and local agencies through an RFP process, and applicants can apply for funding for specific projects or for programs that will fund multiple projects.
One of the major issues with the proposed program is geographic eligibility. Commissioner Tingerthal said that the agency's intent is to target this funding to smaller rural communities, areas with access to few other resources to preserve rental housing. Therefore the Twin Cities are excluded. The agency also would give a scoring preference in awarding funds to places without access to locally distributed federal HOME funds; that preference means the five counties of northeast Minnesota would be at a disadvantage. Representatives of the cities of Eveleth and Virginia and the Arrowhead Economic Opportunity Agency had sent letters to Commissioner Tingerthal asking for access to the pilot program funding. The agency plans to issue an RFP for pilot funds in mid October with applications due November 28.
