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AGENDA RECOMMENDATION |
Consent Calendar 6.I.
City Council Regular Meeting
- Meeting Date:
- 02/10/2025
Agenda Item:
Set February 24, 2025, as the date of public hearing to temporarily establish the HRA and order notice published of enabling resolution.
Recommendation/Action(s):
Set date of Public Hearing and order notice published of enabling resolution.
Summary:
The Mankato Economic Development Authority (EDA) operates a public housing portfolio of 179 units and approved the disposition of units from Section 9 Public Housing into a long-term, Project-Based, Section 8 Housing Choice Voucher rental assistance that provides a stable and predictable annual subsidy.
The EDA approved the application for Section 18 disposition of 49 scattered site units on December 11, 2023. This application for Section 18 disposition was approved by the US Department of Housing and Urban Development (HUD) on September 5, 2024, and tenant protection project-based vouchers were provided to the EDA. It is anticipated that the conversion will be completed in March 2025. The 130 units will be seeking disposition approval later this year.
Through the disposition, the ownership of the public housing units needs to be conveyed to the City of Mankato for less than fair market value and the City will continue to lease to low-income households using subsidies under the Project-Based, Section 8 HCV Program administered by the EDA. In conducting the title work for the public housing properties, it was identified that the properties are still deeded with the Housing Authority of Mankato. Although program administration was transferred to the EDA in 1997, necessary resolutions dissolving the HRA and transferring the assets to the EDA were not completed. To convey the properties to the City of Mankato, it is recommended that the City resurrect the HRA temporarily to properly transfer 49 units to the city under the Section 18 disposition and the remaining 130 units to the EDA under Section 9 Public Housing and then dissolve the HRA.
The remaining 130 units conveyed to the Mankato EDA will be disposed of through the RAD/Section 18 Small PHA Blend program into Project-Based, Section 8 HCV vouchers with an application to HUD later this year.
Under the dispositions, units will be subject to a Declaration of Restricted Use Agreement requiring the rental properties to serve low-income households for a term of 30 years, with such use agreement to be a recorded covenant running with the land and binding on successors and assigns of the City.
The requested action is a motion to set February 24, 2025, as the date of public hearing to consider temporarily resurrecting the Housing and Redevelopment Authority for the purpose of transferring the public housing properties to the City of Mankato and the Mankato EDA.
The EDA approved the application for Section 18 disposition of 49 scattered site units on December 11, 2023. This application for Section 18 disposition was approved by the US Department of Housing and Urban Development (HUD) on September 5, 2024, and tenant protection project-based vouchers were provided to the EDA. It is anticipated that the conversion will be completed in March 2025. The 130 units will be seeking disposition approval later this year.
Through the disposition, the ownership of the public housing units needs to be conveyed to the City of Mankato for less than fair market value and the City will continue to lease to low-income households using subsidies under the Project-Based, Section 8 HCV Program administered by the EDA. In conducting the title work for the public housing properties, it was identified that the properties are still deeded with the Housing Authority of Mankato. Although program administration was transferred to the EDA in 1997, necessary resolutions dissolving the HRA and transferring the assets to the EDA were not completed. To convey the properties to the City of Mankato, it is recommended that the City resurrect the HRA temporarily to properly transfer 49 units to the city under the Section 18 disposition and the remaining 130 units to the EDA under Section 9 Public Housing and then dissolve the HRA.
The remaining 130 units conveyed to the Mankato EDA will be disposed of through the RAD/Section 18 Small PHA Blend program into Project-Based, Section 8 HCV vouchers with an application to HUD later this year.
Under the dispositions, units will be subject to a Declaration of Restricted Use Agreement requiring the rental properties to serve low-income households for a term of 30 years, with such use agreement to be a recorded covenant running with the land and binding on successors and assigns of the City.
The requested action is a motion to set February 24, 2025, as the date of public hearing to consider temporarily resurrecting the Housing and Redevelopment Authority for the purpose of transferring the public housing properties to the City of Mankato and the Mankato EDA.