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3.0 current status of Rambler Redesign Pro ram 3.1 In 1997, with initial funding from the Roseville Housing Fund and promotional grant from Metropolitan Livable Communities Demonstration Program, there were 80 applicants with three chosen homeowners identified. The program provided grants for 100% of the design fees. There were three grants totaling $14,000 provided to the homeowners, 3.2 In 1998, with funding from the Roseville Housing Fund, there were 18 applicants. The program provided V of the design costs up to a maximum of$ ,coo per applicant from the Roseville Housing Fund. To date no grant dollars have been distributed for 1998. 3.3 currently, none of the homeowners chosen in 1997 or potential candidates for 1998 have committed to the program. Staff and QSA Consulting believe the reason lies in the over inflated construction prices and shortage of spilled contractors available due to the extensive storm damage this year. 3.4 A modification of the program is proposed which would include a City deferred loan and partial tax abatement program to male the costs of construction more affordable for the extensive rehab improvements proposed under the guidelines of the Rambler Redesign Program. 3.5 The additional assistance would reduce the burden of escalating construction prices while still meeting the goals of the fumbler Redesign Program for quality, innovative design and construction. 4.0 Syggested Amendment— Ci d eferred Loan and Partial Tax Abatement 4.1 The following outlines the proposed City deferred loan and partial tax abatement criteria —staff will provide a couple of specific examples at the meeting that will illustrate how the City would recoup their costs under the program as the value of the home increases. 4.2 The city Deferred Loan, similar to the housing fix-up fund, is proposed as follows: 1. Improvement costs must be at least $50,000, which would include amount paid for design fees. 2. The proposed City loan, through the Housing Fund, would equal 0% of the improvement costs up to a maximum of$20,000. The remaining cost of the improvement must be financed by the homeowner. 3. The proposed City loan would be at no or low interest and amortized over 20 years, ,Hatching the payment schedule of a local bank or mortgage company. Monthly repayment of the city loan would be deferred through years 1-10. Repayment would be required years 11-20. Therefore, the City would be forgiving half of the loan amount. 4. The city loan would be serviced by a bank or mortgage company. 5. Full repayment of the deferred loan would be required if the home were sold within 0 years. Prepayment would be permitted. RCA!Rambler Redesign 07/27198-Page 2 of 4