Item Description:
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Neg various 2026 ERF grant agmts, total combined NTE $1,989,793; neg ERF grant Agmt PR00008566 with Minnehaha Creek Watershed District for costs incurred 08/02/22-03/12/28, NTE $285,457
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Resolution:
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BE IT RESOLVED, that the County Administrator be authorized to negotiate the following Environmental Response Fund grant agreements for the cleanup of contaminated sites, for periods of two and three years beginning on the dates of execution:
• Agreement PR00008577 with the City of Minneapolis, in an amount not to exceed $143,983,
• Agreement PR00008576 with the City of Minneapolis, in an amount not to exceed $466,000,
• Agreement PR00008572 with the City of Minneapolis, in an amount not to exceed $608,500,
• Agreement PR00008570 with the City of Maple Plain, in an amount not to exceed $240,000,
• Agreement PR00008574 with Minnesota Brownfields, in an amount not to exceed $400,000,
• Agreement PR00008573 with 4740 Partners LLC or affiliated entity, in an amount not to exceed $46,960,
• Agreement PR00008575 with 4orty 2wo Development, LLC or affiliated entity, in the amount not to exceed $39,350,
• Agreement PR00008571 with Sentinel Management Company or affiliated entity, in an amount not to exceed $45,000; and
BE IT FURTHER RESOLVED, that following review and approval by the County Attorney's Office of grant agreements recommended by the County Administrator, the County Administrator be authorized to sign the agreements on behalf of the county; that costs incurred by the grantees after the board approval date be eligible for reimbursement upon execution of the agreements; that the County Administrator be authorized to approve extensions of a 12-month period to the agreements; and that the Controller be authorized to disburse funds as directed; and
BE IT FURTHER RESOLVED, that the County Administrator be authorized to negotiate Environmental Response Fund grant agreement PR00008566 with Minnehaha Creek Watershed District, for costs incurred during the period of August 2, 2022 through March 12, 2028 in an amount not to exceed $285,457; that upon review and approval by the County Attorney’s Office, the County Administrator be authorized to sign the agreement on behalf of the county; and that the Controller be authorized to disburse funds as directed.
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Background:
The Environmental Response Fund (ERF) helps revitalize sites by providing funds to assess and clean up contamination. The grants reduce barriers to site improvement or redevelopment caused by the added costs of environmental cleanup and lessen the risk to human health and the environment posed by the contamination.
Minnesota Statutes, sections 383B.80 and 383B.81, authorize the county to collect a mortgage registry and deed tax for the purpose of establishing an ERF. The board established the ERF in 1997 (Resolution 97-06-410R1) and authorized the grant program in 2001 (Resolution 01-615).
Since 2001, ERF has funded 510 projects totaling more than $84.5 million. Projects supported by ERF provide a variety of community benefits, including creating affordable and moderately priced housing, supporting economic development, and making infrastructure improvements. Many ERF grants address environmental contamination in communities with significant disparities in health, including low-income areas and communities of color. Some of these sites become catalysts for new development in neighboring areas, which can help address racial disparities in housing, employment, and income.
In February 2026, the county solicited proposals from municipalities and nonprofit and for-profit developers, receiving nine applications. Applications were evaluated on project need, the risk posed by the contamination and the appropriateness of the cleanup approach, the creation or preservation of affordable and/or moderately priced market-rate housing, the fostering of economic development, and the readiness of the project to proceed. To maximize collaboration between funders, the timing of the ERF grant round coincides with additional contamination cleanup grant programs administered by the Minnesota Department of Employment and Economic Development and the Metropolitan Council. Eight of the nine applications were recommended for award.
As a major economic center for 150 years, the county has a concentration of contaminated sites. Much of this contamination was caused by chemical spills or improper disposal of hazardous waste prior to the existence of environmental regulations. These improper disposal practices of the past can still cause soil and groundwater pollution that present environmental risks today. In addition, many buildings in Hennepin County, particularly in Minneapolis and the inner ring suburbs, were constructed prior to 1970 when the use of asbestos and lead-based paint was prevalent.
Current Request: This request is to authorize the County Administrator to negotiate ERF grant agreements during various periods, with the total combined amount not to exceed $1,989,793.
The eight Spring 2026 ERF projects recommended for funding are summarized as follows and are described in the attached report, Environmental Response Fund Spring 2026 Funding Recommendations.
• 250 Fremont Development, Minneapolis - $143,983 for soil cleanup associated with the development of new affordable housing building with commercial space. (Grantee: City of Minneapolis on behalf of Lincoln Avenue Communities)
• Grain Exchange Redevelopment, Minneapolis - $466,000 for asbestos and lead-based paint abatement associated with the renovation of three commercial office buildings into mixed-use commercial and residential with affordable and market-rate housing units. (Grantee: City of Minneapolis on behalf of Grain Exchange Housing Limited Partnership)
• InnerCity Tennis, Minneapolis - $608,500 for soil cleanup associated with the development of an athletic facility. (Grantee: City of Minneapolis on behalf of InnerCity Tennis Foundation)
• Maple & Main Apartment Development, Maple Plain - $240,000 for soil cleanup and installation of a soil vapor mitigation system associated with the development of a new market-rate residential building. (Grantee: City of Maple Plain on behalf of North Shore Maple Plain, LLC)
• Minnesota Brownfields Brownfield Gap Financing Program - $400,000 to continue the Brownfield Gap Financing Program, which provides small environmental grants to government entities, non-profit organizations, and emerging developers. (Grantee: Minnesota Brownfields)
• Sawhorse Building, Robbinsdale - $46,960 for installation of a soil vapor mitigation system into an existing commercial building. (Grantee: 4740 Partners LLC)
• Washburn-McReavy Robbinsdale Chapel & City of Robbinsdale Redevelopment Site, Robbinsdale - $39,350 for a hazardous building material survey and soil cleanup associated with development of a new market-rate residential building. (Grantee: 4orty 2wo Development, LLC)
• Wooddale Station Redevelopment, St. Louis Park - $45,000 for soil cleanup associated with the development of new affordable and market-rate housing units. (Grantee: Sentinel Management Company)
This request also seeks approval for the county administrator to sign the agreements; allows the grantees to incur costs after the board approval date, with reimbursements being paid upon execution of the grant agreements; and authorizes the county administrator to approve extensions of a 12-month period to the grant agreements.
This request also seeks approval for the County Administrator to negotiate and sign ERF grant agreement PR00008566 with Minnehaha Creek Watershed District for costs incurred during the period of August 2, 2022, through March 12, 2028 in an amount not to exceed $285,457 for environmental oversight, contaminated soil transport and disposal, associated consulting activities, and associated Minnesota Pollution Control Agency fees. This agreement is related to Minnehaha Creek Watershed District’s 2022 Environmental Response Fund grant agreement PR00004514 (Resolution 22-0297) for the 325 Blake Road project, located in the city of Hopkins, MN. This project has been delayed due to unforeseen right-of-way acquisition delays. The new agreement is needed to reflect the entirety of the work.
These grant awards are funded by the Environmental Response Fund and are budgeted for in the 2026 budget.
Impact/Outcome:
This action helps redevelop vacant and underutilized brownfields into community assets that bring needed housing, jobs and services to communities and get properties back on the tax rolls. On average, ERF-aided projects result in a 7:1 return on investment for property tax revenues. The recommended ERF grant awards will fund soil cleanup, vapor mitigation, and pre-development assessments. The recommended grants support the renovation or construction of approximately 496 affordable housing units and 479 market-rate units.
Cleaning up contamination protects groundwater and drinking water and improves indoor air quality and environmental health. ERF grants support projects in communities with disparities in health, housing, employment, and income. Many of the projects supported by these grants include the construction or renovation of buildings that incorporate sustainable features, which support the county’s zero waste and climate action goals.
This request funds services that are: both mandated and core services
recommendation
Recommendation from County Administrator: Recommend Approval