DISCLAIMER

 

PLANNING AND ECONOMIC DEVELOPMENT COMMITTEE


08-0329R                                                          REPLACEMENT


RESOLUTION AUTHORIZING TRANSFER OF $55,889 IN 2007 HOME FUNDS AND TRANSFER OF $6,487 IN 2006 HOME FUNDS AND AMENDMENTS TO THE 2007 HOME PROGRAM CENTER CITY HOUSING CORPORATION (CCHC) MEMORIAL PART APARTMENTS GRANT AGREEMENT; INCREASING THE FUNDING OF THE AGREEMENT.

CITY PROPOSAL:

     RESOLVED, that the proper city officials are hereby authorized to enter into an amendment to HOME Agreement ___________ with CCHC, substantially in the form of that on file in the office of the city clerk as Public Document No. ______________, increasing the amount payable thereunder from $100,000 to $162,376.

Project

Project Name

Budget

New Amount

Amount of Change

2007 HOME CH07-1226

CCHC Memorial Park Apartments

$100,000

$162,376

$62,376

CH07-2806

Permanent rental housing - WCDO

$55,889

0

($55,889)

6006 HOME CH06-2804

Affordable housing predevelopment - WCDO

$12,975

$6,488

($6,487)


COMMUNITY DEVELOPMENT DIVISION

STATEMENT OF PURPOSE:  The purpose of this resolution is to increase the project funding by $62,376, to a total of $162,376.

 

Center City Housing received a HOME Program grant in 2007 to assist in the rehabilitation of Memorial Park Apartments, located at 605 North Central Avenue. Memorial Park is a 39-unit building, which includes both family apartments and single-room occupancy (SRO) units.

 

The expenses to operate Memorial Park Apartments have significantly exceeded revenues for more than a decade. A major contributor to the cash flow problem are high utility costs for a very energy inefficient building. Working with the city of Duluth and Minnesota housing finance agency, CCHC developed a plan to renovation of the property, and to restructure rent subsidies to ensure the future viability of the property. In 2007, CCHC was awarded $100,000 in HOME funds for the replacement of windows in the SRO portion of the building. The final scope of work allows for a 50 percent decrease in heating and utility costs. CCHC has requested the additional $62,376 in HOME dollars to assist with the upgrade of heating, plumbing and electrical system.

 

CCHC has certified that they are taking no developer fee for the project. The total project budget is $1,201,036.

With the additional funding, the number of HOME designated units will also increase, from seven units to 11 units.

 

The additional HOME funds were originally awarded to another non-profit agency in support of a rental project that is not going forward. That project has been deleted from the community development 2007 action plan. Appropriate notice was published in the Duluth News Tribune on April 5, 2008. No comments were received during the ensuing 30 day public comment period. The community development committee held a public hearing at their meeting on April 29, 2008, where no comments were received. The committee voted to approve the change in the action plan.