Item Description:
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Neg Amend to Agmt PR00001996 with Greater MN Housing Fund for acquisition of naturally occurring affordable housing, extend the term to 12/31/42; no change to NTE
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Resolution:
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BE IT RESOLVED, that the Executive Director be authorized to negotiate an amendment to Agreement PR00001996 with Greater Minnesota Housing Fund, or affiliated entity, to preserve naturally occurring affordable housing, extending the contract end date from February 28, 2040 to no later than December 31, 2042, with no change in the not to exceed amount of $2,000,000; that following review and approval by the County Attorney's Office, the Chair be authorized to sign the amendment and related documents on behalf of the Authority; and that the Controller be authorized to disburse funds as directed.
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Background:
Hennepin County has over 45,000 unsubsidized multifamily rental housing with rents affordable to households with incomes at or below 60 percent of the Area Median Income (AMI). Rents in these “naturally occurring affordable housing” (NOAH) units tend to average from $950 to $1,450 per month. The properties range in size, age, location and ownership. Hennepin County accounts for approximately 50 percent of the NOAH units across the seven-county metropolitan area.
To preserve this valuable resource, the Hennepin County Housing and Redevelopment Authority (HCHRA) approved a $3 million contribution to Greater Minnesota Housing Fund’s (GMHF’s) NOAH Impact Fund in 2016 (Resolution 16-HCHRA-0021). The fund was created to finance the acquisition and preservation of NOAH properties to preserve affordability for the long-term. After that fund preserved 701 affordable units across the region, GMHF launched NOAH Pool 2, to which the HCHRA invested $2 million (Resolution 20-HCHRA-0004). NOAH Pool 2 leverages $26.5 million in additional public, philanthropic, and private investment in addition to the HCHRA investment. The parties, including Program Administrator NOAH Impact Fund LLC, entered into Agreement PR00001996 (Master Credit Agreement) in 2024.
To date, NOAH Pool 2 LLC has facilitated the purchase of two NOAH portfolios in Hennepin County, securing the affordability of over 360 units in Plymouth (126 units) and Richfield (236 units).
NOAH Pool 2 has an available balance of $3.4 million that could support the purchase of approximately 80 additional NOAH units and secure their affordability but needs additional time to identify partners and purchase properties. Staff recommend extending PR00001996 through December 31, 2042, to facilitate continued implementation.
Current Request: This request is to amend Agreement PR00001996 (NOAH Pool 2 Master Credit Agreement) with Greater MN Housing Fund, extending the contract end date to December 31, 2042, with no change in the not to exceed amount of $2,000,000.
Impact/Outcomes: Approval of this request will allow more time to identify partners and purchase naturally occurring affordable housing properties, protecting affordability for approximately 80 more households.
Housing Disparity Domain: This request protects affordability for lower-income households and protects against housing cost burden. Households of color are disproportionately housing cost burdened.
This request funds services that are: core services
recommendation
Recommendation from County Administrator: Recommend Approval