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RESOLUTION OF SUPPORT FOR ONE ROOF COMMUNITY HOUSING’S REQUEST TO THE STATE OF MINNESOTA FOR QUALIFYING MULTIFAMILY FUNDING AND THE CONDITIONAL COMMITMENT OF UP TO $3,857,143 OF AMERICAN RESCUE PLAN ACT FUNDING AND INTENT TO APPROVE A HOUSING AND REDEVELOPMENT AUTHORITY OF DULUTH TAX INCREMENT FINANCE PLAN TO PROVIDE UP TO $1,000,000 FOR THE CONSTRUCTION OF THE 72 UNIT BRAE VIEW SENIOR APARTMENTS PROJECT.
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CITY PROPOSAL:
RESOLVED, that the City of Duluth hereby expresses its support for One Roof Community Housing’s request to Minnesota Housing Finance Agency (MHFA) for the allocation of low-income housing tax credits and/or other funding provided by MHFA, to construct a 72-unit affordable multifamily apartment building for seniors in the Central Hillside neighborhood (the “Project”).
BE IT FURTHER RESOLVED, that the City Council of the City of Duluth does hereby conditionally commit up to $3,857,143 of American Rescue Plan Act (ARPA) funding to support a portion of the cost of the Project, subject to the Developer, One Roof Community Housing, successfully securing the necessary funding from MHFA and other funding sources to ensure project completion by 2026 and to the approval of a development agreement between the City and the Developer.
BE IT FURTHER RESOLVED, that the Duluth City Council hereby states its intent to approve a tax increment financing (“TIF”) plan creating a housing TIF district if and when brought forward by the Housing and Redevelopment Authority of Duluth, MN, (HRA) to support up to $1,000,000 over a term of up to 26 years in connection with construction of the Project.
Statement of Purpose
STATEMENT OF PURPOSE: This resolution expresses the City Council’s support of an application to be submitted to MHFA by One Roof Community Housing (One Roof), for low-income housing tax credit and other Multifamily Consolidated RFP funding that may be awarded by MHFA for the construction of the Brae View Senior Apartments project. The deadline for submission of the application to MHFA is July 13, 2023. MHFA intends to finalize funding decisions at their December 14, 2023 board meeting. Additionally, this resolution expresses support of a commitment of up to $3,857,143 of the City’s ARPA funding. Brae View Senior Apartments was one of six proposals selected through the City’s Multi-family RFP process to receive ARPA funds. The City and Developer will negotiate a formal development agreement and solicit Council approval for use of ARPA funds, subject to the Developer successfully securing the necessary funding from MHFA and other sources to ensure construction completion by 2026. This resolution also approves support of creation of a tax increment financing (TIF) district through the HRA to support TIF financing up to $1,000,000 over a term of up to 26 years.
The project will be located in the Central Hillside neighborhood of Duluth near the intersection of East 5th Street and 4th Avenue East. Construction of this 72-unit multifamily apartment will provide affordable rental opportunities for seniors 55+. Fifteen (15) units will be income restricted for individuals earning 30% or less of Area Median Income (AMI), 32 units for individuals earning 50% or less of AMI, and 25 units for individuals earning 60% AMI or less. Eight (8) units will be reserved as Permanent Supportive Housing for high priority homeless adults. Essentia Health will own the ground floor and use it to operate a childcare center for 100 infants and children. Ecumen will provide on-site senior and property management services.
MHFA requires applicants to submit a City Council resolution of support to demonstrate local support and that the project meets locally identified housing needs. A 2019 Maxfield Research Inc. housing analysis reported that Duluth could absorb roughly 3,500 additional units of affordable housing by 2024. The demand for this type of housing has been further substantiated through staff research and analysis during both the Imagine Duluth 2035 comprehensive plan update and annual Housing Indicator Reports.