Sponsor: Community & Economic Development
Title
title
Alignment of Wilder Square Apartments Project with Conduit Bond for Affordable Housing Policy
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Recommendation
recommendation
Affirm alignment of the Wilder Square Apartments Project with the Conduit Bond Financing Program for Affordable Housing Policy by the Housing and Redevelopment Authority.
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Background
background
The County Board approved the amended Conduit Bond Financing Program for Affordable Housing Policy on November 17, 2020.
CB Wilder Square GP LLC, a wholly owned affiliate entity of CommonBond Communities, a Minnesota nonprofit corporation has proposed that the Ramsey County Housing and Redevelopment Authority (HRA) issue its revenue bonds in the approximate aggregate principal amount of up to $16,500,000.
The proceeds of the bonds are proposed to be loaned by the HRA to the CB Wilder Square GP LLC to be applied by the CB Wilder Square GP LLC to finance the acquisition, renovation, and equipping of an approximately 136-unit multifamily rental housing development and functionally related amenities known as Wilder Square Apartments Project. Wilder Square Apartments Project is located at 750 Milton Avenue North in Saint Paul, Minnesota.
Staff reviewed the project application for the Wilder Square Apartments Project and concluded that the project aligns with the approved Conduit Bond Financing Program for Affordable Housing Policy.
Preliminary approval is required before submitting the application to State of Minnesota Management and Budget. HRA must hold a public hearing and adopt a resolution granting approval of the project for allocation from the State of Minnesota Management and Budget to be completed. Preliminary approval of the Wilder Square Apartments Project is scheduled for action at the HRA on November 24, 2020.
Once the project has been notified that there is sufficient bonding capacity for the project to proceed, Ramsey County HRA will follow the procedures established in the conduit policy and procedure guide adopted in February 2004. During this time, the HRA will conduct due diligence and work with Bond Counsel to assure issuance requirements are met. Prior to issuance, the HRA Board will need to approve a final resolution of authorization. The closing on the sale of the bonds must occur within 180 days of award.
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County Goals (Check those advanced by Action)
☐ Well-being ☒ Prosperity ☒ Opportunity ☐ Accountability
Racial Equity Impact
There is an existing gap of or need for more units for households at or below 30% of the Adjusted Median Income (AMI). Currently, households/individuals earning 30% AMI or less, outnumber the total number of units that are affordable to them by roughly 15,000 in Ramsey County based on the latest data available.
What we know: Households of black, indigenous, and people of color that are cost-burdened are overwhelmingly earning 50% AMI or lower. The majority of cost-burdened households are white, but black, indigenous, and people of color households are more likely to be cost-burdened (e.g. 48% of African American households outside Saint Paul are cost-burdened, but they account for only 4 percent of the cost-burdened households in Ramsey County.)
Additionally, the median white household in Ramsey County can afford roughly $1,000 more in housing costs per month than the median African American household in Ramsey County. This income inequality translates into inequality in affordable housing options for all nonwhite households.
To increase production of housing and deepen affordability of housing units in Ramsey County, an additional resource for affordable housing, especially one with incentives for developers, lends itself as a tool to reduce inequalities in housing opportunities experienced by minority households.
The county has flexibility to set parameters on projects financed through conduit bonds to ensure the most critical needs are addressed with priority (e.g. 30% AMI units).
Community Participation Level and Impact
Ramsey County residents have consistently expressed concern about a lack of affordable housing in the County. The community is informed of this action through the County Board documentation, which is available on the County’s website at https://www.ramseycounty.us/your-government/leadership/board-commissioners/board-meetings-information
☒ Inform ☐ Consult ☐ Involve ☐ Collaborate ☐ Empower
Fiscal Impact
Acting as an issuer of Conduit Bonds bears no financial risk for the County. Administrative fees will be collected as part application submittals to offset internal review costs by Finance and Community and Economic Development staff.
County Manager Comments
Granting preliminary approval allows this affordable housing preservation project to submit an application for allocation of bonding authority to State of Minnesota Management and Budget office.
Last Previous Action
On November 17, 2020, the Ramsey County Board of Commissioners approved an amended policy and procedures summary supporting participation in a conduit bond financing program for affordable housing (Resolution B2020-233).
On October 26, 2020, the Ramsey County Housing and Redevelopment Authority received an update on conduit bond financing for affordable housing projects.
On February 3, 2004, the Ramsey County Housing and Redevelopment Authority approved a prior summary of policies and procedures for conduit bonds (Resolution H04-002).
Attachments
1.Commonbond Request Letter
2. Wilder Square Apartments - Preliminary Approval Resolution for HRA