5.0 HRSR 12-01-2008 - Laserfiche WebLink

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ITEM # 5. ~~'~..~, ~-- ~ver MEMORANDUM TO: Housing 8~ Redevelopment Authority FROM: Jeff Gongoll, Community Development Director DATE: December 1, 2008 SUBJECT: Consider Grant Application for Neighborhood Stabilization Program (NSP) Funds On Friday, November 21, 2008, Mayor Klinzing, Director of Economic Development Cathy Mehelich and I attended a "working group" meeting regarding federal foreclosure recovery funds and specifically the recently established Neighborhood Stabilization Program (NSP). I have asked Mayor Klinzing to attend the HRA meeting to join in the discussion regarding this program. The Mayor is also on the Board of Directors of the Greater Minnesota Housing Fund (GMHF), anon-profit affordable housing intermediary. The GMHF was the sponsor of the working group meeting on November 21, along with Minnesota Housing. Background In response to the drastic increase in foreclosures and the impact of the subprime lending situation on housing, Congress authorized the NSP program under the Housing and Economic Recovery Act (HERA) signed by the President in July 2008. NSP provides emergency assistance for the redevelopment of abandoned and foreclosed homes that might otherwise become sources of abandonment and blight. Minnesota Housing is a grantee for the state in the amount of $38.8 million and will administer the use of these funds in highly impacted communities in greater Minnesota. ($20 million has also been allocated specifically to metro area jurisdictions). The Draft Plan (just released) lists communities in the greater Minnesota counties listed below as eligible for up to $4.7 million of the state portion of NSP funds. In addition to Elk River, the following communities have been identified in the Draft Plan as eligible to apply for certain portions of funds in anon-competitive pool; Isanti, Big Lake, Buffalo, St. Michael, Otsego, Monticello, Princeton, and Zimmerman. Additionally, communities in Sherburne, Isanti, Benton, Chisago, Stearns and Wright counties may apply for funds in a designated $6 million competitive pool. It has been determined that Elk River is eligible for $715,446 in NSP funds.