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.