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Home My WebLink About[05] SCDP Grant 5 Council Agenda Item MEETING DATE: July 20, 2015 AGENDA ITEM: Public Hearing, Small Cities Grant SUBMITTED BY: Administration BOARD/COMMISSION/COMMITTEE RECOMMENDATION: PREVIOUS COUNCIL ACTION: In 2014 the City applied for and was awarded a small cities grant in the amount of $ 525,000 for housing rehab from Deed. In addition to the grant funding the City had an additional $66,000 from a previous block grant that was used to increase available funding to near $ 600,000. The grant is a collaborative effort with Central MN Housing Partnership, who serves as the program administrator. BACKGROUND INFORMATION: The program allowed for housing rehab, (siding/roofing/windows, etc) for LMI residents who meet annual household incomes. The program limits are as follows: Household Size Household Size Annual Gross Household Annual Gross Household 1 41,000 5 63,250 2 46,850 6 67,950 3 52,700 7 72,650 4 58,550 8 77,300 The target area is 1st Ave. NE to Birch Street to 4th Ave. NE/5th Ave. SE to Baker Street and back to 1st Ave. SE. Funding is provided as a 0%, deferred, forgivable loan with a seven year term. Loans can be up to $20,000, and the loan balance is forgiven 1/7th per year of the loan. Owner match funds are also a requirement to complete projects. A typical project scope of work may include: new roofing, siding, windows, doors, insulation, furnaces, electrical upgrades, addressing health and safety items and lead based paint remediation. As the program is nearing completion, the City is required to conduct a public hearing regarding the status of the grant program. Part of the program includes adopting a section 3 plan reaching out to low to moderate income persons for employment, as it relates to the housing grant and to adopt a program income plan. The City is familiar with and has managed a similar DEED grant whereby funds were turned back to the City. In fact, that is how the additional $ 66,000 was added to the grant. Any funds returned due to lack of qualification or sale will be kept in a separate fund. BUDGET/FISCAL IMPACT: ATTACHMENTS: Request for Council Action Hearing Notice Section 3 Plan SCDP Program Income Plan Financial Update Contractor Notice REQUESTED COUNCIL ACTION: Adopt the Section 3 Plan and Program Income Plan for the SCDP Community Development Block Grant. . �. CITY OF ST. OS�PH 1 wWW.cityof stjoseph.com Administrator �udy Weyrens Notice of Public Hearing on Program Update for Mdy°� The Small Cities Development Program R��k S�h�lc� Community Development Block Grant (CDBG) Funding Counci�ors Matt Killam To Whom It May Concern: . Bob Loso Renee Symanietz Dale W;�k NOTICE IS HEREBY GIVEN, that the City Council of St. Joseph, Minnesota will meet in Council Chambers of the St. Joseph City Hall, located at 25 College Ave North St. Joseph, MN 56374, at 6 p.m. on July 20,thereby dedicating a portion of their regular monthly meeting to receive an update on the progress of the SCDP home rehab projects through the Community Development Block Grant(CDBG)program. Dated this 8t" day of July, 2015. Judy Weyrens Administrator Publish: July 10, 2015 zS College Avenue North • PO BoX 668 • Saint �oseph, Minnesota 56374 phone 320.363.72oi �ax 3zo.363.o34z CITY OF ST. JOSEPH SMALL CITIES DEVELOPMENT PROGRAM SECTION 3 PLAN The city of St. Joseph(hereinafter referred to as "the City"), in conjunction with Small Cities Development Program Grant#CDAP-12-0092-O-FY13, has the following plan to direct employment and other economic opportunities generated by HUD financial assistance for housing and community development programs,to the greatest extent feasible, toward low- and very low-income persons, particularly those who are recipients of government assistance for housing. Section 3 is a HUD requirement that is intended to ensure that when employment or contracting opportunities are available on HUD funded projects,preference is given to low- and very low- income persons or businesses. Being a Section 3 Business is not required; however,preference is given to those businesses. The City will attempt to recruit low-income residents through at least one of the following: local advertising media, contracts with the community organizations and public or private agencies operating within the City in which the Section 3 covered program or project is located, having the General Administrator of the program provide information about Section 3 businesses in bid packets to general contractors. The City will require all contractors to complete and submit the Section 3 Business Certification Form prior to awarding contracts. The City and the General Administrator will keep a list of Section 3 businesses. While being a Section 3 business is not required for the program,the Cities and General Administrator will give preference to qualified, competitive Section 3 businesses. CITY OF ST. JOSEPH SCDP PROGRAM INCOME PLAN Small Cities Development Program funds awarded for owner-occupied rehabilitation will be structured as a 0%, deferred forgivable loan with a 7-year term. These loans may become due and payable on a pro-rated basis if property ownership is transferred during the term of a loan. The city will establish a process for loan payoffs (when applicable). The city shall establish separate accounts as the destination for program income and local funds respectively. Program income represents $35,000 or more collected in a federal fiscal year. Local funds represent funds of less than $35,000 collected. Funds will be used in the follow manner: • Program income or local funds received during the grant period will be deposited in the designated account. Once the account balance reaches $2,500, funds will be made available for the financing of additional rehabilitation projects meeting SCDP requirements: • Any program income or local funds remaining after the grant period has expired, and all program income or local funds collected by the city thereafter, shall be used for a use consistent with the original SCDP application, contract and Program Income Plan. During the grant period,the city shall be responsible for maintaining their program income and/or local funds account. Upon request from CMHP,the city shall annually provide required program income and local funds information during the open grant award. During the open grant period, it will be the responsibility of the Central Minnesota Housing Partnership to submit the annual program income report as part of the full SCDP annual report to DEED. After the grant period is over,the city shall be responsible for maintaining their program income account and submitting the required annual program income report to DEED. St. Joseph Small Cities Development Program Update Monday July 20�', 2015 Original Grant Amount $525,000.00 Grant Funds Allocated $349,531.00 An additional $66,218.00 of non-grant funds have been utilized. Grant Funds Remaining $175,469.00 There have been 15 projects completed to date. - There are 4 projects under construction and 3 more in the bidding stage. 2 applications are in the verification stage. Contractors Wanted Now seeking General Contractors for upcoming owner-occupied rehabilitation projects located within the taxget area in the city of St. Joseph. Program funding is being provided by the Minnesota Department of Employment and Economic Development via the Small Cities Development Program. Section 3 and Women or Minority owned businesses are encouraged to apply. The City of St. Joseph will give preference to qualified, competitive Section 3 and Women or Minority owned businesses. Must have current Minnesota Contractors License and required insurance coverage. For an application to participate, please contact Ed: 320-258-0673 or ed�cmh�.net Central MN Housing Partnership, Inc. 37 28th Ave North, Suite #102 St. Cloud, MN 56303