HRA Meeting Date: March 6, 2025
To: Members of the Housing and Redevelopment Authority
From: Melissa Hanson, Housing Coordinator
Title
Amend Resolution 2024-001 Dedicating Source of Public Revenue for the Local Housing Trust Fund.
Body
Action Requested:
The HRA to amend Resolution 2024-001 Dedicating Source of Public Revenue for the Local Housing Trust Fund.
Summary Report:
The Northfield HRA’s mission is to be a partner in providing a sufficient supply of affordable, adequate, safe and sanitary dwellings in Northfield. The primary guiding document supporting that mission is the city’s adopted Comprehensive Plan.
Our goal is to create a community with housing opportunities available along the entire housing spectrum: from renters to homeownership, first-time homeowners, to senior living, workforce housing and empty-nesters. We strive to create affordable housing opportunities and strengthen our neighborhoods utilizing:
• Sustainability
• Innovation
• Partnerships
• Community Input
Attachment 1 is the video and HRA packet from February 1, 2024 meeting adopting Resolution 2024-001.
On February 4, 2025, Community Development Staff submitted to Minnesota Housing Finance Agency (MHFA) our Intent to Apply for matching Local Housing Trust Fund grants. On February 19, 2025 MHFA released a Request for Proposal (RFP) application materials for the Local Housing Grants Program matching funds. That application is due on Wednesday, March 19, 2025.
While assembling the documents for submission of the application, it was noticed that Resolution 2024-001 did not dedicate enough Public Revenue from outside of state and federal sources to be eligible for the state match. At the February 1, 2024 meeting, the Local Housing Trust Fund subcommittee’s recommendations were discussed by the HRA Board. The subcommittee’s recommendation included 40% of the HRA levy to be dedicated to the LHTF.
The two (2) current dedicated sources of funding identified by Resolution 2024-001 for the LHTF are:
1. 50% of CDBG funds annually received from Dakota County Community Development Agency;
2. 100% of the City’s annual allocation of Statewide Affordable Housing Aid to Cities.
During the 2025 budgeting process, the subcommittee recommended 40% ($161,500) of the 2025 HRA levy was allocated to the LHTF. On December 5, 2024 the HRA motioned approval of the HRA budget, which included $161,500 to be directed to the Local Housing Trust Fund and to fund certain funding requests from Rice County Habitat for Humanity, Northfield Union of Youth, and the Community Action Center.
Attachment 2 is the HRA summary budget identifying 40% of HRA levy funds to the Local Housing Trust Fund.
The HRA is being asked to approve Attachment 3 Resolution 2024-001(AMENDED) that dedicates 40% of the annual HRA levy to the Local Housing Trust Fund. If the HRA doesn’t approve dedicating at minimum $150,000 annually from Public Revenue outside of state or federal funds, we will not be eligible to apply for the matching funds from Minnesota Housing Finance Agency.
The subcommittee members were Commissioner Crow, Commissioner Nystrom, Commissioner Zuccolotto, and former Commissioners Dee and Gerdes.
Alternative Options:
The HRA is able to consider either of the attached resolution as written, or make additional amendments.
Financial Impacts:
Forty percent (40%) of the HRA would be dedicated to the LHTF annually for housing programs and projects.
Tentative Timelines:
• 2017 - Minnesota became the 14th state to pass legislation to formally recognize local housing trust funds for housing development (Minn. Stat. 462C.16: Housing Trust Funds for Local Housing Development). Attachment 2.
• 2021 - Minnesota passed the Omnibus Housing Finance bill that included $1 million for state matching grants, to be administered though Minnesota Housing Finance Agency (MHFA) for Local Housing Trust Funds (LHTF) up to $150,000.
• 2022 - The City of Northfield approved Ordinance No. 1034 establishing a Local Housing Trust Fund. Attachment 3.
• 2023 - Minnesota passed the historic $1.065 billion Housing Omnibus bill, the largest single investment in housing in state history. This bill included and additional $4.8 million for state matching grants, to be administered through MHFA for LHTFs.
• 2024 - The City of Northfield’s LHTF is funded with State Affordable Housing Aid.
• February 2025 - Intent to apply to MHFA for matching funds when application is available submitted.
• March 2025 - Application to MHFA for matching funds is due.
• July 2025 - Grant recipients to be notified.