8A, Arden Village Workforce Housing

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Ramse_y Countv Grant Contribution As reported at the May 10 Council meeting, Ramsey County awarded Arden Village a$3 5,000 grant to support their housing tax credit application. The proj ect may be eligible for up to $300,000 in additional grant money in 2011, but the County does not want to tie up 2010 grant money for a project that is not scheduled to start until 2011. When Ramsey County's support was discussed at the Council meeting, it was not clearly explained how that grant may impact SCI's request from the City. It was initially thought that it could reduce SCI's request from the City. However, it has since been explained that funding from Ramsey County would reduce the overall support from MHFA resulting in essentially no net gain to SCI. This was confirmed directly with MHFA. The primary bene�t of the grant is that the County's initial contribution adds points to the housing tax credit application and increases the chance that this proj ect is selected for housing tax credits. Additionally, Ramsey County HR.A's mission is to add workforce housing units in Ramsey County, which is why they support the project. Nevertheless, the City could still include "look back" provisions in the development agreements should SCI obtain funding that reduces their need from the City. Updated Letter of Support The deadline for the housing tax credit application is June 15, 2010. The City will need to make a determination on the letter of support at their June 14 meeting or SCI will not be able to complete their tax credit application. MHFA will make its determination by October 28, 2010. If the tax credits are approved, the City would begin the formal TIF review in spring 2011. The TIF review would be completed before construction starts and likely be certi�ed by June 30, 2011. While the letter of support does not commit the City to provide the full funding request, the Council expressed concern about potentially misrepresenting the City's financial support in SCI's tax credit application to MHFA. Since the communications tower sale has become entangled in the letter of support, the City's decision on whether or not to pursue purchasing the tower will inform the wording in the updated letter of support (see attachment). Based on the updated �nancial data and direction from the May 10 Council meeting, SCI has prepared two possible public subsidy strategies depending on whether or not the City wants to pursue ownership of the tower. The City will need to select one of the two options for the letter of support that is submitted to MHFA for SCI's application. Whichever option is selected, the City would be offering a good faith commitment to provide the requested amount of support to the proj ect p�ovided that SCI receives the housing tax credits and the final financial analysis demonstrates the need for the requested support. City of Arden Hills City Council Meeting for June 14, 2010 IlMetro-inet.uslardenhillslPlanninglCommunity DevelopmentlHousinglAffordable HousinglArden Village - Sand Companies1061410 - CC Memo - Arden Village - Sand Companies.doc Page 3 of 4