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HomeMy WebLinkAbout01-13-2014 HRA Special AgendaHOUSING & REDEVELOPMENT AUTHORITY AGENDA 7:30 P.M. Special Meeting January 13, 2014 Conference Room 1, City Hall 590 40"" AVE., COLUMBIA HEIGHTS, MN 1. Call to Order 2. Roll Call Tammera Diehm, Chair Bruce Nawrocki Bobby Williams, Vice Chair Donna Schmitt, Secretary /Treasurer Rheta Nelson Gary Peterson 3. Pledge of Allegiance 1. Approval of the Rental Assistance Demonstration Application (RAD) on Resolution 2014 -1 MOTION: Move to approve the RAD Application on Resolution 2014 -1. The next HRA meeting will be January 28, 2014 at Parkview Villa. COLUMBIA HEIGHTS HOUSING AND REDEVELOPMENT AUTHORITY (HRA) SPECIAL MEETING Meeting of: January 13, 2014 AGENDA SECTION: 1) Rental Assistance ORIGINATING EXECUTIVE Demonstration Application DEPARTMENT: HRA DIRECTOR APPROVAL ITEM: Resolution 2014 -01 Authorizing BY: Scott Clark BY OrIA Submittal of RAD Application DATE: January 8. 2014 BACKGROUND: In April of 2013 the City's Housing and Redevelopment Authority (HRA) submitted to the Department of Housing and Urban Development (HUD) a Voluntary Conversion application. This application was the second attempt to gain the approval of HUD to allow the HRA to dissolve the Parkview Public Housing Agency (PHA) status and, in turn, allow the sale to AEON. The objective of the Voluntary Conversion application was to illustrate, by means of a HUD approved methodology, that the long term cost to HUD was less by allowing the private sector to operate the facility with specified contract rents (i.e. running it as a project based Section 8 property) as opposed to HUD's current commitment of subsidizing the PHA's operating expenses and annual modernization funds. The application proved that the private side sale was more cost effective but the bottom line is that HUD has not agreed to the application for a number of reasons. Since the City and our partner AEON were of the opinion that our discussions with HUD had reached a stalemate, Congressman Keith Ellison's office was contacted for assistance. After a number of educational and listening sessions with both his staff and himself personally, Congressman Ellison contacted directly Secretary of HUD Shaun Donovan. In turn, a "liaison" was established as a go between for our City /AEON team with the different HUD applications. The next consideration is the discussion of the applicability of selling Parkview under what is called the Rental Assistance Demonstration (RAD) program, which appears to be HUD's preferred route for PHA dispositions and related sales This is a new program and the idea is the "marriage' of public and private. Under this program the PHA and or the HRA would stay in an ownership position (at least on paper) and the sale to the private market would allow either equity or debt positions to be secured that would not be available to a public entity (e.g. infusing equity through tax credits). The problem with RAD is that the maximum contract rent amounts are so low that only small scale rehabilitation work can be accomplished and the operating budget could not support special services. Under the Voluntary Conversion process the contract rents would be almost $300 higher and this amount is needed in order to accomplish the aggressive and needed rehabilitation work that is planned as part of the AEON sale. The accompanying RAID application illustrates a significant funding gap and may serve to bolster our Voluntary Conversion application, and the need for higher contract rents, which is still being considered. Put in another way, the authorization to submit the RAID application will produce two live HUD requests and hopefully, with the assistance of our liaison, some path will be arrived at that will allow both the sale to occur and for the contract rents to be secured at a level that will allow the necessary work to be completed. Staff will provide more details as requested at the meeting and if you have any questions prior to the special meeting please contact staff accordingly. RECOMMENDATION: Approval of Resolution 2014 -01 as written RECOMMENDED MOTION: Motion: Move to waive the reading of resolution 2014 -01 there being ample copies available to the public Motion: Move to adopt Resolution 2014 -01, approving Resolution of the Columbia Heights Housing and Redevelopment Authority Approving Submission of a Rental Assistance Application for Parkview Villa North HRA ACTION: HRA RESOLUTION 2014 -1 RESOLUTION OF THE COLUMBIA HEIGHTS HOUSING & REDEVELOPMENT AUTHORITY (HRA) APPROVING SUBMISSION OF A RENTAL ASSISTANCE DEMONSTRATION APPLICATION FOR PARKVIEW VILLA NORTH WHEREAS, the HRA owns and operates 101 units of public housing at Parkview Villa North (PVN), including one unit currently used for management; and WHEREAS, PVN has deferred maintenance, capital and resident service needs that appear not to be able to be met through continued insufficient funding under the public housing program; and WHEREAS, the Consolidated and Further Continuing Appropriations Act of 2012 (Public Law 112 -55, approved November 18, 2011) created the Rental Assistance Demonstration (RAD) Program, which allows Public Housing Authorities (PHAs) to convert public housing subsidies into long -term, project -based Section 8 rental assistance subsidies with the hope that this funding source will provide more stable and predictable annual funding and better facilitate leveraging of other resources such as low - income housing tax credits than public housing; and WHEREAS, HRA staff has prepared a RAD application for PVN and is following all required procedural steps to submit the application to the U.S. Department of Housing and Urban Development (HUD); and WHEREAS, the HRA previously submitted an application to HUD for voluntary conversion of PVN to vouchers that would provide more sufficient resources for PVN than RAD, including for critical supportive services, but that application may not be approved or may be partially approved by HUD; NOW, THEREFORE BE IT RESOLVED, that the Board of Commissioners of the HRA (1) approves the attached Board Approval Form for a RAD application to HUD for the conversion of PVN from public housing to Section 8 project -based assistance, (2) otherwise authorizes the Executive Director to execute and submit the RAD application and any related documents to HUD, and (3) authorizes the Executive Director to take any necessary actions to comply with all requirements of the RAD program. ADOPTED THIS 13 °i Day of January, 2014 MOTION BY: SECONDED BY: ROLL CALL: HOUSING & REDEVELOPMENT AUTHORITY Chair- Tammera Diehm Executive Director - Walter Fehst 1331384.1038011 FILE