Item Description:
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2026 LAHA funding recommendations - Neg 2 2026 award agmts, 05/12/26-05/12/81, total combined NTE $1,409,733
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Resolution:
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BE IT RESOLVED, that the Executive Director be authorized to negotiate the following Local Affordable Housing Aid (LAHA) Agreements during the period May 12, 2026 through May 12, 2081:
• PR00008403 with CommonBond Communities, or affiliated entity, for the Arbor Lakes Commons project, with a not to exceed amount of $575,000;
• PR00008393 with Trellis Co., or affiliated entity, for the Cheatham Apartments project, with a not to exceed amount of $834,733;
that following review and approval by the County Attorney's Office, the Chair be authorized to sign the agreements and related documents on behalf of the authority; and that the Controller be authorized to disburse funds as directed.
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Background:
In 2023, the 93rd Minnesota Legislature approved a sales and use tax dedicated to affordable housing, and annual appropriations to the new Statewide and Local Affordable Housing Aid funds. The 0.25% Metropolitan Region Sales and Use Tax for housing, together with annual appropriations, has provided approximately $30 million per year for Hennepin County under the Local Affordable Housing Aid (LAHA) and Statewide Affordable Housing Aid (SAHA) programs. The primary intent of these new funding sources is to increase production and preservation of affordable housing.
In November 2023, the Hennepin County Board affirmed a LAHA/SAHA implementation framework tailored to leverage Hennepin County's unique program-based strengths to address our deepest racial disparities in housing (Resolution 23-0438). The implementation framework outlined five strategies to improve housing outcomes along the county’s affordable housing continuum, including capital funding to increase affordable housing production.
Resolutions 25-0364 and 25-HCHRA-0052 (adopted December 11, 2025) allocated approximately $1.4 million of Hennepin County’s LAHA/SAHA to capital funding for affordable rental housing creation and preservation.
The Coordinated Affordable Housing Development request for proposals (RFP) was released in December 2025, making capital funding resources available from Affordable Housing Incentive Fund (AHIF), Local Affordable Housing Aid (LAHA), Supportive Housing Strategy, Homeownership Assistance Fund, and federal HOME Investment Partnerships (HOME) and Community Development Block Grant (CDBG) funds. The RFP garnered 36 qualified multifamily rental applications requesting approximately $37.9 million. Proposals were reviewed by Housing and Economic Development and Health and Human Services staff for consistency with Hennepin County priorities. Proposals were then reviewed and ranked by a multiagency panel.
This action awards funding from LAHA revenues to two affordable housing development projects that were selected from the RFP. This funding will be provided in the form of a 30- to 50-year deferred loan. Loan documents include a loan agreement, promissory note, mortgage, and declaration of covenants and restrictions. In addition, at the project’s financial closing and during the term of the loan, the HCHRA may be asked to sign various related documents and amendments, including subordination agreements and disbursement agreements.
Recommended Project Awards:
Arbor Lakes Commons - PR00008403 - CommonBond Communities - $575,000
8100 Main Street, Maple Grove; preservation of 50 affordable rental units for seniors (10 units affordable and restricted to households at or below 30 percent of AMI and below; 40 units at or below 50 percent of AMI; 49 units with rental assistance.)
Cheatham Apartments - PR00008393 - Trellis Co - $834,733
3716 Cheatham Avenue South, Minneapolis; construction of 79 affordable rental units (26 units affordable and restricted to households at or below 30 percent of AMI; 53 units at or below 50 percent of AMI; 20 units for people exiting homelessness; 32 units with rental assistance; 20 units for large families.)
Attachment A provides further detail on the two projects recommended for funding.
Current Request: This request is for the authorization to negotiate two implementation agreements with a combined total not to exceed amount of $1,409,733 under the 2026 LAHA Program.
Impact/Outcomes: Two projects will create or preserve a total of 129 affordable housing units in Hennepin County; projects will include 36 units for households with incomes at or below 30 percent of AMI, 93 units for households with incomes at or below 50 percent of AMI, 50 units reserved for seniors, and 20 units designated and reserved for people experiencing homelessness.
Housing Disparity Domain: Households of color are disproportionately housing cost-burdened, and experience housing instability, including homelessness, at disproportionate rates. This request creates housing opportunities for individuals with incomes at or below 30 percent and 50 percent of area median income, and creates units specifically reserved for people experiencing homelessness.
recommendation
Recommendation from County Administrator: Recommend Approval