2007-05-15_Minutes - Laserfiche WebLink

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8.Action Items: a.Consider Modifications to and Funding for the HRA Ownership Loan Program. Ms. Bennett explained that this action is a follow-up to the discussion about the HRA Ownership Loan Program at the March 20, 2007 Roseville Housing and Redevelopment Authority (RHRA) meeting. At that meeting the RHRA directed staff to gather further information and bring a recommendation to the Board regarding a change to the applicant criteria. Ms. Bennett summarized the current financial status of the loan fund, noting that the RHRA has financed 121 loans in the amount of approximately $1.2 million with $73,604.00 currently available in the fund to finance additional loans. Ms. Bennett also indicated that the loan fund is low and will need to be replenished so the program can continue to provide loan assistance. Ms. Bennett noted that, unlike the RHRA’s Family Affordable Loan Program, the HRA Ownership Loan Program is not restricted to households with children under 16, households at median income levels or homes of a specified assessed valuation. Over the life of the program, the average income of loan recipients is $69,000.00 (median income) however, 17% of loan recipients have had household income more than $94,200 (120% of median income for a family of four). Ms Bennett recommended an income restriction on this program of 120% of median income. Ms. Bennett didn’t recommend adding an assessed valuation limitation to this loan program as it can be too restrictive and older households may have a higher assessed valuation but still limited income. Ms. Bennett noted that there is an increase in usage in the program largely due to the increase in the loan amount from $10,000.00 to $20,000.00. Ms. Bennett recommended adding $60,000.00 of $100,000.00 available in the 2007 RHRA budget, noting that the program hasn’t had an addition of funds since 2002. Member Masche inquired if the program requires borrowers to match funds (no). Member Kelsey asked about $100,000.00 available in the 2007 RHRA budget and indicated her understanding that it was earmarked to assist the Inspection Department for properties that were in violation. Ms. Bennett replied that the fund was dual-purpose: to put back into loan pool and/or to provide for code-related issues such as abatements, therefore she recommended leaving some funding in place for those instances. Member Kelsey inquired as to the average cost for abatement. Ms. Bennett indicated that cost has been $15,000.00 on average according to past discussions with the Inspection Department. Member Pust asked for clarification of the criteria for the Family Affordable Loan Program which includes an assessed value limitation, income limitation of 120% of median income and households with a child 16 years of age or younger. Member Pust inquired if there is a conflict of interest provision in the loan programs (no). Member Kelsey commented that as interest rates have gone up and this program is becoming better utilized, perhaps the RHRA should also consider an assessed value limitation. Member Pust inquired as to the number of loan applications this year (approximately 20). Member Kelsey commented that the RHRA loan programs could be more aggressively marketed to Roseville residents. Chair Majerus agreed. Member Pust agreed with an income limitation for this program and indicated that she would also support an assessed value limitation. Member Kelsey suggested an assessed value limitation of 125% of median value similar to the Housing Redesign Program. Chair Majerus suggested tabling the motion to better evaluate the suggested criteria modifications to the loan program and directed Ms. Bennett to bring the item forward for action at next month’s meeting. Member Elkins suggested using the state finance agency’s number for acquisition costs ($298,300 for the metropolitan area) as a guide for determining an assessed value limitation for this loan program. Member Pust wondered why this loan program was not designed for first-time homebuyers thereby attracting new residents to the community. Member Kelsey indicated that this loan program was designed to assist existing residents who would like to make improvements to their homes and that the Family Affordable Loan Program met the goal of attracting young families to the community.