EDSR MEMORANDUM 04-12-1993 - Laserfiche WebLink

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Although a tax bill authorizing the issuance of mortgage revenue bonds has not been passed by Congress and signed by the President, MHFA is confident the bill will be approved some time in 1993. As a result, MHFA desires to go through the mortgage allocation process in lieu of its ability to issue the revenue bonds. It is anticipated that MHFA will issue approximately $43 million dollars in mortgage revenue bonds . These bonds are used exclusively by first time homebuyers, and, enable the buyers to obtain long term (30 years) , below market (approx. 7 .5%) , financing on the purchase of existing homes or the construction of new ones . Because it is a first time homebuyer program, certain restrictions apply. That is, an applicant' s income cannot exceed a certain level. Staff believes the 1993 income threshold will be $40,800 . In addition, homes purchased under this program cannot exceed a certain level. In 1992, homes purchased under this program for metropolitan communities could not exceed $85,000 (existing homes) or $95,000 (new construction) . A draft of the 1993 Elk River EDA application to MHFA is enclosed in the agenda packet. An allocation in the • amount of $1,500,000 in mortgage revenue funds for Elk River is requested. Most likely, MHFA will allocate less than the requested amount. ACTION REQUESTED The EDA is asked to authorize the submission of an application in the amount of $1,500,000 to the Minnesota Housing Finance Agency for inclusion in its Minnesota City Participation Program. Further, the EDA is asked to authorize payment of a deposit equal to 1% ($15,000) of its requested allocation. This deposit will be refunded by MHFA upon the sale of mortgage revenue bonds . 7 . LOAN REQUEST FROM TESCOM CORPORATION A separate memo has been prepared for this agenda item. 8 . UPDATE ON MULTI-COUNTY DEVELOPMENT COMPANY The following public or quasi-public entities from Sherburne County have passed resolutions of support for the Coon Rapids Development Company to expand into Sherburne County and have pledged $1,000 each towards the • purchase of stock in the new multi-county entity: Becker EDA, Elk River EDA, Elk River Municipal Utilities, Big Lake EDA, Sherburne County EDC, Zimmerman EDA (decision at future meeting) .