2006-11-21_Agenda - Laserfiche WebLink

Home

HIA Recommendation (11-21-06) - Page 4 of 5 however, be prepaid in full to avoid the payment of interest. 4.0 Does Establishment of a Housing Impr ovement Area for large Multi-Family Renovation Meet the RHRA’s Housing Plan Goals & Objectives? 4.1 One of the key goals in the Roseville HRA Housing Plan is to: a. “Preserve existing housing and develop new hous ing in partnership with federal, state and regional agencies and non-profit community groups and businesses.” 4.2 Further, section 4.7 of the housing plan specifically re fers to the creation of HIA as a tool to achieve the City’s housing goals: a. “Evaluate the establishment of Housing Improvement Districts to address ownership multi- family improvements – (Town home and Condo). Work with the town homes and condominiums in Roseville that were built in the 1970’s and are aging.” Identified as a high priority of the HRA. b. With over 1,700 units, many of which were c onstructed over 30 years ago, these are one of the most affordable housing types in the co mmunity. The findings of the Roseville HRA’s multi-family study indicate that those older units include a majority of people over the age of 55. Many of these town home/condo associations have not set aside adequate home owners association dues to cover the escalating construc tion costs over the years. Therefore, the funding of large association improvements are either delayed or increases the monthly payment to a level that many seniors or lower income individuals can not afford. c. The City and HRA can provide a financing mechanism through a housing service district to help spread the costs of improvements over a longer period of time at lower interest rates. This method is similar to a special assessment procedure. Housing Improvement Districts initiated by the HRA at the request of a town home/condo association requires up front capital which would be paid back, w ith interest over a 15-20 year term. 4.3 The MN State Legislature created this program for the purposes of assisting older complexes to finance major improvements so that there would be less of a financial burden on the residents. When these older complexes were constructed, they were not required to collect adequate reserves for future capital improvements. Nor did they anticipate properl y the need to collect additional funds for larger project improvements. Newer town home complexes have learned from the past and organizing legal documents require that a certain percentage of reserves be held in anticipation of large capital improvements. Older complexes are still trying to catch up. Part of the process for a HIA requires that a financial plan be completed by the association so that future fund balan ces will be available for large capital projects. 4.4 What may occur if a HIA is not created for Westwood Village I? a. Improvements will not be completed and there will be further deterioration to the complex and the neighborhood. b. If the complex is force to privately finan ce owners who can not finance may be forced to sell