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ITEM ~ 8.1. <br />of <br />1111 ~/'~. <br />River <br />MEMORANDUM <br />TO: Housing and Redevelopment Authority ~j <br />FROM: Heidi Steinmetz, Assistant Director of Economic Development ~J <br />DATE: January 3, 2005 <br />SUBJECT: Minnesota City Participation Program <br />Attachments <br />• MCPP Guidelines <br />• MCCP Program Enhancements <br />• 2004 MCPP Usage Report <br />Background <br />From 1991 to 1996, the Elk River HRA participated in the Minnesota Housing Finance <br />Agency's (MHFA) Minnesota City Participation Program (MCPP), which provides loan <br />dollars to qualified first time home buyers. Through the MCPP, MHFA sells mortgage <br />revenue bonds on behalf of communities to meet locally identified housing needs. The <br />proceeds are then used to provide below-market interest rate mortgages to first time <br />homebuyers with income limits outlined in the attached MCPP Guidelines. The loans are <br />originated and administered through local lenders approved by the MHFA. <br />To participate in the program, staff would need to complete the application and administer <br />any city added targeting or enhancements such as those listed in the attached MCPP <br />Program Enhancements list, and monitor fund usage. The HRA would need to pay a <br />processing fee of $20 for each $100,000 allotment provided and a 1% refundable deposit. <br />Issue <br />Staff recently received information regarding the 2005 MCPP. The HRA has not <br />participated in the program since 1996, however Sherburne County has applied and been <br />awarded an allocation for the last several years. The attached MCPP Usage Report indicates <br />that Sherburne County was allotted over one million dollars in 2004 and completed nine <br />loans. <br />Recommendation <br />The Sherburne County Administrator has indicated to staff that he will apply fora 2005 <br />allocation therefore staff does not recommend a separate city application. <br />