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HomeMy WebLinkAbout2025-08-28 HRA Meeting Packet Meeting location: Edina City Hall Council Chambers 4801 W. 50th St. Edina, MN Housing & Redevelopment Authority Meeting Agenda Thursday, August 28, 2025 7:30 AM Participate in the meeting: Watch the meeting on cable TV or YouTube.com/EdinaTV. Provide feedback during Community Comment by calling 312-535- 8110. Enter access code 2868 945 1011. Password is 5454. Press *3 on your telephone keypad when you would like to get in the queue to speak. A staff member will unmute you when it is your turn to speak. Accessibility Support: The City of Edina wants all residents to be comfortable being part of the public process. If you need assistance in the way of hearing amplification, an interpreter, large-print documents or something else, please call 952-927- 8861 at least 72 hours in advance of the meeting. 1. Call to Order 2. Roll Call 3. Pledge of Allegiance 4. Approval of Meeting Agenda 5. Community Comment During "Community Comment," the Chair will invite residents to share issues or concerns that are not scheduled for a future public hearing. Items that are on tonight's agenda may not be addressed during Community Comment. Individuals must limit their comments to three minutes. The Chair may limit the number of speakers on the same issue in the interest of time and topic. Individuals should not expect the Chair or Commissioners to respond to their comments tonight. The Chair will respond to questions raised during Community Comments at the next meeting. 5.1. Executive Director's Response to Community Comments 6. Adoption of Consent Agenda All agenda items listed on the Consent Agenda will be approved by one motion. There will be no separate discussion of items unless requested to be removed by a Commissioner. If removed the item will be considered immediately following the adoption of the Consent Agenda. (Favorable roll call vote of majority of Commissioners present to approve, unless otherwise noted in consent item.) 6.1. Minutes from August 14, 2025 Regular meeting 6.2. Adopt Summary of the HRA Work Sessions Focused on Affordable Housing Page 1 of 63 Direction 6.3. Edina Housing Foundation Appointments 6.4. Authorize City Staff to engage legal council to prepare loan documents pertaining to 3400 Parklawn Avenue and 5010 Summit Avenue for future HRA approval. 7. Reports/Recommendations: (Favorable vote of majority of Commissioners present to approve except where noted) 7.1. Proposed uses for 2025 Allocation of Local Affordable Housing Aid (LAHA) 7.2. Edina "Heroes" Down Payment Assistance Program 7.3. Resolution No. 2025-06 Adopting the Proposed Budget and Establishing the Proposed Tax Levy Payable in 2026 8. Executive Director Comments 9. HRA Member Comments 10. Adjournment Page 2 of 63 BOARD & COMMISSION ITEM REPORT Date: August 28, 2025 Item Activity: Approve Meeting: Housing & Redevelopment Authority Agenda Number: 6.1 Prepared By: Liz Olson, Administrative Support Specialist Item Type: Minutes Department: Community Development Item Title: Minutes from August 14, 2025 Regular meeting Action Requested:Approve August 14, 2025, Regular Meeting Minutes. Information/Background: Supporting Documentation: 1. Minutes from August 14, 2025 Regular Meeting Page 3 of 63 Page 1 MINUTES OF THE REGULAR MEETING OF THE EDINA HOUSING AND REDEVELOPMENT AUTHORITY AUGUST 14, 2025 7:30 A.M. I. CALL TO ORDER Chair Hovland called the meeting to order at 7:32 a.m. then explained the processes created for public comment. II. ROLLCALL Answering rollcall were Chair Hovland, Commissioners Agnew, Jackson, Pierce, and Risser. Absent: None. III. PLEDGE OF ALLEGIANCE IV. MEETING AGENDA APPROVED – AS PRESENTED Motion by Commissioner Jackson, seconded by Commissioner Pierce, approving the meeting agenda as presented. Ayes: Agnew, Jackson, Pierce, Risser, and Hovland Motion carried. V. COMMUNITY COMMENT No one appeared. V.A. EXECUTIVE DIRECTOR’S RESPONSE TO COMMUNITY COMMENTS Executive Director Neal responded that there were no past Community Comments. VI. ADOPTION OF CONSENT AGENDA AS PRESENTED Motion by Commissioner Jackson, seconded by Commissioner Pierce, approving the consent agenda as presented: VI.A. ADOPT RESOLUTION 2025-04, AUTHORIZATION TO TRANSFER PROPERTY LOCATED AT 5146 EDEN AVENUE TO CITY OF EDINA VI.B. DRAFT MINUTES OF SPECIAL WORK SESSION MINUTES OF MAY 29, 2025, SPECIAL MEETING MINUTES OF JUNE 10, 2025, REGULAR MEETING OF JUNE 12, 2025, AND SPECIAL MEETING OF JULY 24, 2025 Ayes: Agnew, Jackson, Pierce, Risser, and Hovland Motion carried. VII. REPORTS AND RECOMMENDATIONS VII.A. RECOMMENDING DEVELOPMENT TEAM FOR PROPERTY AT 5146 EDEN AVENUE – APPROVED Economic Development Manager Neuendorf stated that this item pertained to identifying and recommending the development team for the old Public Works site at 5146 Eden Avenue. Economic Development Manager Neuendorf presented an overview of the 11 proposals for this 3- acre site, evaluation factors, recommended development team, conceptual site plan, and reference images. Economic Development Manager Neuendorf noted that the recommended development teams are Hempel Real Estate, Monarch Development, Jester Concepts, and Rokos Advisors. Page 4 of 63 Minutes/HRA/August 14, 2025 Page 2 The Board thanked all the applicants for their proposals and interest in this site and expressed their excitement for this particular proposal and how it took into account the challenges of the site. The Board asked questions regarding mechanisms to ensure affordability, navigating funding, and land sale. Motion by Commissioner Jackson, seconded by Commissioner Pierce, recognizing the development team consisting of Hempel Real Estate, Monarch Development, Jester Concepts, and Rokos Advisors as the recommended development team to purchase and redevelop vacant property located at 5146 Eden Avenue, and authorize staff to prepare a sales agreement for future consideration. Ayes: Agnew, Jackson, Pierce, Risser, and Hovland Motion carried. VII.B. RESOLUTION NO. 2025-05; APPROVING INTERFUND LOAN TO EDEN WILLSON TIF DISTRICT FOR USE IN ROADWAY AND BRIDGE IMPROVEMENTS – ADOPTED Economic Development Manager Neuendorf said this item pertained to the City-led project to reconstruct multiple bridges along Vernon and 50th Street. Economic Development Manager Neuendorf presented information regarding the Interfund loan, map of the Vernon Avenue and Highway 100 Interchange project, and the boundaries of the Centennial Lakes TIF fund set up in 1988. The Board asked questions regarding the benefit this will be to the City, ways to pay the City back, possible extension of the TIF district, and language noting if it is a forgivable loan. Economic Development Manager Neuendorf stated that if funds are available, this would be recorded as a debt on the books of the Eden Willson District, but if funds are not available, there would not be a repayment. Economic Development Manager Neuendorf stated that it gives the HRA the option to be a forgivable loan. Member Jackson introduced and moved adoption of HRA Resolution No. 2025-05, authorizing a loan and transfer of funds from the Centennial Lakes TIF Fund to the Eden Willson TIF District and authorization to use funds for the construction of public improvements on adjacent roadways and bridges. Seconded by Member Agnew. Ayes: Agnew, Jackson, Pierce, Risser, and Hovland Motion carried. VII.C. AMEND REDEVELOPMENT AGREEMENTS WITH EDINA ENCLAVE, LLC AND LIFESTYLE COMMUNITIES, LLC PERTAINING TO 7235 FRANCE AVENUE – APPROVED Economic Development Manager Neuendorf stated that this item pertained to the approved redevelopment agreements with Enclave Development and Lifestyle Communities for the Macy’s site. Economic Development Manager Neuendorf presented information regarding the existing conditions, development team, amendment to the timing noted in the redevelopment agreement, and schedule changes to reflect 2025 market conditions. The Board asked questions regarding the estimated market value and the baseline figure that will be taxed. Page 5 of 63 Minutes/HRA/August 14, 2025 Page 3 Economic Development Manager Neuendorf stated that when the developer purchases the site, the TIF District is certified, and the base gets locked in. The Board noted that this is a place where they should have incremental change, not transformational change. Motion by Commissioner Jackson, seconded by Commissioner Pierce, approving the first amendments to each of the three Redevelopment Agreements for 7235 France Avenue, including SW Element, NW Element, and East Element, and authorizing staff to carry out the terms of the amended agreements. Ayes: Agnew, Jackson, Pierce, and Hovland Nay Risser Motion carried. Patrick Brama, Enclave Development, noted that there are two components of this project: land closing/master site improvements and timing/market conditions. VIII. EXECUTIVE DIRECTOR COMMENTS – Received VIII.A SPARC PROGRAM UPDATE IX. HRA MEMBER COMMENTS – Received X. ADJOURNMENT Motion made by Commissioner Jackson, seconded by Commissioner Agnew, to adjourn the meeting at 8:37 a.m. Ayes: Agnew, Jackson, Pierce, Risser, and Hovland Motion carried. Respectfully submitted, Scott Neal, Executive Director Page 6 of 63 d ITEM REPORT Date: August 28, 2025 Item Activity: Approve Meeting: Housing & Redevelopment Authority Agenda Number: 6.2 Prepared By: Stephanie Hawkinson, Affordable Housing Development Manager Item Type: Report & Recommendation Department: Community Development Item Title: Adopt Summary of the HRA Work Sessions Focused on Affordable Housing Direction Action Requested: Adopt Summary of the HRA Work Sessions Focused on Affordable Housing Direction Information/Background: Three HRA work sessions were held on February 13, March 13 and May 25, 2025 to help set the future direction of affordable housing to satisfy the 2024/2025 budget work plan item “Advance progress to affordable housing goals, including increasing housing options and developing a long-term growth strategy.” In order to create a forward-looking plan, the first two sessions were designed to provide context. The February 13th work session was focused on reviewing policies and plans that guide affordable housing. The March 13th work session focused on current Edina household demographics relative to the existing housing stock and forecasted values. The third work session was designed to have the HRA Commissioners narrow down their priorities for the future direction of affordable housing. The attached report provides a table summarizing the housing types that were prioritized by the HRA Commissioners, their alignment with City approved plans, the elements to creating over which the HRA has some control, and challenges over which the HRA has limited control. Resources/Financial Impacts: There are no budget implications generated by this summary. Relationship to City Policies: The summary contains information regarding how the different housing types align with various City plans. Budget Pillar: Livable City Values Impact: Engagement There were multiple public meetings prior to the adoption of the City's policies and plans that help guide the creation of affordable housing. The summary identifies which plans support the various Page 7 of 63 housing types. Sustainability The identified housing priorities require the preservation of the existing housing stock, an increase in gentle density, and some multifamily housing where allowed. All these characteristics support the climate action plan by reducing waste, increasing density along transit corridors, and developing affordable housing near transit. Health The summary is a focus on the priorities for affordable housing, which is a primary social determinant of health. Housing insecurity can lead to poor health outcomes, so the creation and preservation of affordable housing can greatly benefit the people who have access. Stewardship The financial elements of affordable housing was not a focus of these sessions. However, the priorities include housing types that would gently increase the density which could have a positive impact on property taxes collected. Further, investing in affordable housing ensures responsible management of resources to create sustainable, long-term housing solutions for community stability. Equity The identified housing priorities provide additional access to affordable housing for different phases of life, which create opportunities to minimize housing disparities that disproportionately impact people of color, seniors, and people with disabilities. Supporting Documentation: 1. Staff Report Page 8 of 63 City of Edina • 4801 W. 50th St. • Edina, MN 55424 Information / Background: Three HRA work sessions were held on February 13, March 13, and May 25, 2025, to help set the future direction of affordable housing to satisfy the 2024/2025 budget work plan item “Advance progress to affordable housing goals, including increasing housing options and developing a long-term growth strategy.” In order to create a forward-looking plan, the first two sessions were designed to provide context. The February 13th work session was focused on reviewing policies and plans that guide affordable housing. The March 13th work session focused on current Edina household demographics relative to the existing housing stock and forecasted values. The third work session was designed to have the HRA Commissioners narrow down their priorities for the future direction of affordable housing. Although changes to existing policies and plans may be forthcoming, that was not the purpose of this process, nor was the intent to review or reconsider past decisions. Defining Future Success 1. Increase housing supply 2. Keep financial support local to the extent possible 3. Provide workforce housing 4. Provide special needs and senior housing Populations to Retain who Require Affordable Housing 1. Seniors/Retirees 2. Existing residents with limited incomes who want to remain in their homes 3. Families with school-aged children 4. Adult children of Edina residents with intellectual/physical disabilities 5. Young adults who grew up here and want to remain 6. Anyone who wants to live in Edina Date: August 28, 2025 To: Chair and HRA Commissioners From: Stephanie Hawkinson, Affordable Housing Development Manager Subject: Work Session Outcomes and Future Direction of Affordable Housing Staff Recommendation: Adopt Summary of the HRA Work Sessions Focused on Affordable Housing Direction. Page 9 of 63 City of Edina • 4801 W. 50th St. • Edina, MN 55424 Populations to Attract who Require Affordable Housing 1. Young families 2. People who work in Edina 3. People interested in living in NOAH housing Housing Priorities (# of Commissioner votes) During the third Work Session, the Commissioners prioritized what they believe staff should focus on for affordable housing in the next few years. Each Commissioner was provided with five stickers to place on a variety of housing types as a mechanism to “vote” on their priorities. With the five Commissioners, there were a total of 25 votes. The housing types that received the most votes, in order from most to least, were: 1. Preserving Naturally Occurring Affordable Housing (“NOAH”) single family houses for ownership – 6 votes (one for more Commissioners voted for this type of housing more than once); 2. New construction of townhomes for ownership housing – 5 votes; 3. New construction of multi-family apartments – 3 votes; 4. New construction of duplexes and triplexes for ownership – 3 votes; 5. New construction of single family ownership housing – 2 votes; 6. Preservation of NOAH duplexes and triplexes for ownership – 2 votes; 7. New construction low-rise/missing middle rental apartments – 2 votes 8. Preservation of NOAH townhomes – 1 vote; and 9. Preservation of NOAH ownership low-rise buildings – 1 vote. The table below summarizes the identified priorities, the population served by the prioritized types of housing, how each type aligns with City approved plans, and factors over which the City does and does not have control. Plans and Policies Key: 1 Comprehensive Plan 2 Climate Action Plan 3 Housing Strategy Task Force Implementation Plan 4 New Multifamily Affordable Housing Policy Page 10 of 63 City of Edina • 4801 W. 50th St. • Edina, MN 55424 Housing Types People Served Alignment with Plans or Policies City Locus of Control Outside of City Control NOAH Single Family Ownership (6) • Families • Local workforce 1, 3 • Whether funding is available for Affordable Ownership Preservation Program in partnership with Habitat and Homes Within Reach • Consider zoning changes that would disincentivize tear- down/re-builds • Whether down payment program is available to the buyer to bridge what the home is selling for and what they can afford to buy • Whether funding is available for new partners • Diminishing supply • Cannot control to whom dwelling is sold • Cannot control if private party demolishes home, including either a developer or a home buyer • Even if not demolished, owners can still make improvements to existing homes that make them unaffordable to future buyers New Townhome Ownership (5) • Families • Local workforce 1, 2, 3 • Zoning and land use approvals • How to respond to opposition • Whether development gap financing is available to sell at less than what it costs to build • Whether down payment program is available to the buyer to bridge what the home is selling for and what they can afford to buy • Few areas where this type of housing is allowed within current zoning or guided for in the Comprehensive Plan where it doesn’t already exist. • Increasing density does not automatically equate with affordable or attainable housing New Multifamily Rental (3) • Seniors • People with disabilities • Local workforce 1, 2, 3, 4 • Zoning and land use approvals • Use of TIF • Whether development gap financing is available to sell at less than what it costs to build • Under current zoning code, must be located on 7% of residential land, leading to concentration Page 11 of 63 City of Edina • 4801 W. 50th St. • Edina, MN 55424 • How to respond to opposition • Allow for deeply affordable units • Whether to address sanitary sewer capacity New Duplex/Triplex Ownership (3) • Families • People with disabilities • Local workforce • Young adults 1, 2, 3 • Zoning and land use approvals • How to respond to opposition • Whether development gap financing is available to sell at less than what it costs to build • Whether down payment program is available to the buyer to bridge what the home is selling for and what they can afford to buy • Few areas where this type of housing is allowed within current zoning • Increasing density does not automatically equate with affordable or attainable housing New Single Family Ownership (2) • Families • Local workforce 1, 3 • Address zoning and land use to allow for small lots • Whether development gap financing is available to sell at less than what it costs to build • Whether down payment program is available to the buyer to bridge what the home is selling for and what they can afford to buy • High cost of land • Current zoning calls for lot sizes that support larger homes NOAH Duplex/Triplex Ownership (2) • Local workforce • Seniors • Families • Young adults 1, 2, 3 • Whether down payment program is available to the buyer to bridge what the home is selling for and what they can afford to buy • Cannot control to whom dwelling is sold • Limited supply New Rental Low- rise (2) • People with disabilities • Local workforce • Seniors 1, 2, 3, 4 • Zoning and land use approvals • How to respond to opposition • Few areas where this type of housing is allowed within current zoning • Increasing density does not automatically equate Page 12 of 63 City of Edina • 4801 W. 50th St. • Edina, MN 55424 • Families • Whether development gap financing is available to sell at less than what it costs to build • Whether to address sanitary sewer capacity with affordable or attainable housing NOAH Ownership Townhomes (1) • Local workforce • Seniors • Families 1, 3 • Whether down payment program is available to the buyer to bridge what the home is selling for and what they can afford to buy • Consider HIA to address long-term maintenance issues. • Cannot control to whom dwelling is sold • Limited supply NOAH Ownership Low- rise (1) • Local workforce • Seniors • Families • Consider HIA to address long-term maintenance issues. • Cannot control to whom dwelling is sold • Limited supply Locus of Control categories The City’s locus of control falls within two main categories: financial and non-financial. Financial tools • Development gap: What it costs to build housing and what is an affordable sale price or rent level. This can be addressed through a loan or grant to the developer. • Affordability gap: What housing costs to rent or own and what a renter/buyer can afford to pay. This is addressed through rental assistance or down payment assistance to the occupant. To be effective, there should be some certainty about the availability of funding. For example, without a sufficiently funded down payment assistance program, there is too much uncertainty when a buyer is looking for a home to know whether the funding will be available when they make an offer. • Funding mechanisms such as Housing Improvement Area (HIAs) • Infrastructure improvements, such as increasing sewer capacity, to allow for more housing development. Non-financial tools • Zoning and land use changes that support affordable housing. • Responses to resident opposition to land use changes and financial assistance. Page 13 of 63 d ITEM REPORT Date: August 28, 2025 Item Activity: Approve Meeting: Housing & Redevelopment Authority Agenda Number: 6.3 Prepared By: Stephanie Hawkinson, Affordable Housing Development Manager Item Type: Other Department: Community Development Item Title: Edina Housing Foundation Appointments Action Requested: Appoint Bernadette Hornig, Mary Kay McNee, and Ann Swenson to the Edina Housing Foundation with a term ending 3/1/26. Information/Background: The Edina Housing Foundation consists of five members. Per the Foundations by-laws, members shall be appointed each year. Two members are appointed by City Council and three are appointed by HRA. The HRA is being asked to appoint Bernadette Hornig, Mary Kay McNee, and Ann Swenson. Resources/Financial Impacts: Not applicable Relationship to City Policies: Not applicable Supporting Documentation: None Page 14 of 63 d ITEM REPORT Date: August 28, 2025 Item Activity: Approve Meeting: Housing & Redevelopment Authority Agenda Number: 6.4 Prepared By: Stephanie Hawkinson, Affordable Housing Development Manager Item Type: Other Department: Community Development Item Title: Authorize City Staff to engage legal council to prepare loan documents pertaining to 3400 Parklawn Avenue and 5010 Summit Avenue for future HRA approval. Action Requested: Authorize City Staff to engage legal council to prepare loan documents pertaining to 3400 Parklawn Avenue and 5010 Summit Avenue for future HRA approval. Information/Background: On June 13, 2024, via Resolution No. 2024-03, the HRA awarded up to $850,000 in a 0% interest, deferred loan to CommonBond Communities, a 501(c)3 nonprofit corporation for the refinancing, renovation and preservation of South Haven (3400 Parklawn Avenue South) and Summit Point (5010 Summit Avenue). Together, these two buildings provide affordable housing to 129 extremely low- income seniors and individuals with disabilities. CommonBond acquired the buildings in 2005 and completed moderate renovations in 2006. No significant improvements have happened since that time. The HRA financing was contingent upon CommonBond being awarded bond financing that comes with 4% Low Income Housing Tax Credits, bringing investor equity to the capital stack. These funds have now been awarded and CommonBond is working towards closing on all the required financing for this $40M project. Property Information and Resident Population: Both Summit Point and South Haven were developed in the 1980’s and serve seniors and people with disabilities with very low incomes. Although older, both properties are well maintained. • South Haven is a 100-unit, 7-story property located at 3400 Parklawn Avenue • Summit Point is a 29-unit, 3-story property located at 5010 Summit Avenue • All 129 units have rental assistance via project-based Housing Assistance Payment (HAP) contracts with the Department of Housing & Urban Development (HUD) (i.e. project-based Section 8). The HAP contracts are administered by Minnesota Housing. Based on the HAP contracts, residents pay 30% of their income towards rent. Staff is seeking authorization to engage legal counsel to draft and review the necessary loan documents. A financial closing is anticipated for end of 2025. Resources/Financial Impacts: The source for the previously awarded $850,000 is Southdale 2 TIF Pooled funds. Page 15 of 63 Relationship to City Policies: The renovation and preservation of Summit Point and South Haven align with the Comprehensive Plan and the Climate Action Plan. CommonBond and their architects have been working closely with the City's Sustainability team. Budget Pillar:Use text snippets to i Livable City Better Together Values Impact: Sustainability Generally renovating buildings is more environmentally sustainable than demolishing with debris going to landfills and building new using natural resources. More specifically, the renovation of South Haven and Summit Point will adhere to the Sustainable Buildings Policy by achieving the required points from Enterprise Green Communities. For example, CommonBond will be installing more energy efficient mechanical systems and windows, LED lighting, and energy efficient appliances. Equity The refinancing and rehabilitation of both South Haven and Summit Point are necessary for the on-going operation of these two affordable apartments that serve 129 seniors and people with disabilities who have very low-incomes. They are two of very few apartments that are 100% covered by HAP contracts. Their preservation maintains the ability for the tenants to stay in Edina, with no alternatives if the buildings were to increase the rents to market rate, get sold or demolished. Engagement South Haven and Summit Point have been serving some of the most vulnerable and disenfranchised Edina residents since 2006: very low- income seniors and people with disabilities. This is not the population that traditionally participates in the public process. Public financial support to help with safety and aesthetic improvements of these two buildings symbolizes to these Edina residents that they are an important part of our community. Health The financing supports affordable housing where the tenant’s portion of the rent is capped at 30% of their income, thus no resident is housing cost burdened which is a source of stress for 49% of Edina renters*. The funding will also improve physical health by addressing accessibility, safety and security needs. In addition, as the buildings have not been renovated in 18-years they appear tired and in need up upgrades. Investment in the physical environment could be beneficial to the tenants’ lived experiences. Supporting Documentation: 1. Resolution No. 2024-03 2. June 2024 Presentation Page 16 of 63 Page 17 of 63 Page 18 of 63 Resolution No. 2024-03 Supporting the Preservation of Affordable Housing at 3400 Parklawn Avenue and 5010 Summit Avenue June 13, 2024 Page 19 of 63 Today’s Request •Adopt Resolution 2024-03 •Loan Details: •$850,000 •0% interest •Co-terminus with Minnesota Housing deferred loan (30-40 years) Photo credit: CommonBond Communities website Page 20 of 63 Local Context •The majority of senior renters in Edina are housing cost burdened (pay greater than 30% of income on housing costs).* •In Section 8 housing, renters pay 30% of their income towards rent. •There are two project based section 8 apartments in Edina that serve seniors: South Haven and Summit Point. *American Community Survey Page 21 of 63 CommonBond Communities •501(c)3 nonprofit corporation •Established in 1971 •Own and manage over 7000 rental apartments and townhomes across 60 cities •Acquired South Haven and Summit Point in 2005 Page 22 of 63 South Haven 4300 Parklawn Avenue •100 unit apartment •Average Income: $17,176 •Average tenancy:7.38 years •Average Age: 68.8 years •20-year HAP Contract Page 23 of 63 Summit Point 5010 Summit Avenue •29 apartment units •Average Income: $17,262 •Average tenancy: 6.9 years •Average age: 73.8 years •20-year HAP Contract Page 24 of 63 Sources and Uses Sources Uses Minnesota Housing 1st Mortgage $ 8,538,000 Refinance $ 9,998,829 LIHTC Equity ("tax credits") $ 14,917,069 Rehabilitation $ 18,045,000 Minnesota Housing Deferred Loan $ 4,635,768 Contingency $ 1,804,500 Sales Tax Rebate $ 315,788 Environmental Abatement $ 451,500 Energy Rebate $ 35,000 Professional Fees $ 1,540,145 CommonBond Seller Note $ 5,630,000 Developer Fee $ 3,800,000 Hennepin County $ 2,650,000 Financing Costs $ 2,591,912 City of Edina $ 850,000 Required Reserves $ 1,066,503 NOI during Construction $ 180,000 Existing Reserves $ 870,000 Deferred Developer Fee $ 676,664    $ 39,298,388 $ 39,298,388 Page 25 of 63 Southdale II TIF Pooled Funds Regular Southdale TIF Pooled Funds Estimated Balance Requests Repayment Starting Pooling Capacity $7,098,091    66 West  ($275,000)  7008 Sandell  ($350,000)  4040 W. 70th Street  ($3,650,000)$3,650,000 Metro HRA  ($2,000,000)  4040 W. 70th Street - Loan to Cornelia View LLC  ($153,921)  5780 Lincoln - Not approved     Transfer to AHTF (Habitat program 2023)* ($1,200,000)  Tax Court Appeals - 2023  ($105,276)  Tax Court Appeals - 2022  ($256,600)  CommonBond Preservation  ($850,000)  Future Funding Capacity $1,907,294    *in lieu of SPARC funds Page 26 of 63 Alignment with City Values Community Engagement Improves quality of life for existing vulnerable residents. Health in All Policies Increases housing security by preserving two buildings were residents pay 30% of income. Race and Equity Improves the housing for some of the most disenfranchised in our Community. Sustainability Preserves and increases energy efficiency in existing buildings. Page 27 of 63 d ITEM REPORT Date: August 28, 2025 Item Activity: Approve Meeting: Housing & Redevelopment Authority Agenda Number: 7.1 Prepared By: Stephanie Hawkinson, Affordable Housing Development Manager Item Type: Report & Recommendation Department: Community Development Item Title: Proposed uses for 2025 Allocation of Local Affordable Housing Aid (LAHA) Action Requested: Approve recommendation and authorize staff to engage the legal council to prepare agreements. Information/Background: In 2023, the State Legislature approved a local area sales tax to support affordable housing. In the Metropolitan area, this program is referred to as LAHA. In 2024, the legislature clarified that these funds are to augment rather than replace existing local support for affordable housing. In 2024, Edina received $339,342.32. In 2025, the city's allocation is $875,381.99. Eligible Projects: • Emergency rental assistance • Financial support to nonprofit affordable housing • Projects designed for the purpose of construction, acquisition, rehabilitation, demolition or removal of structures, construction financing, permanent financing, interest rate reduction, refinancing, and gap financing of housing to provide affordable housing Staff Recommendations: • VEAP – Emergency Rental Assistance $200,000.00 • Affordable Ownership Preservation Program $581,881.99 • Mount Olivet Rolling Acres - home repairs $ 93,500.00 All funding recipients are negatively impacted by cuts made in Federal funding allocations. Description of Program Recipients: VEAP is a basic needs organization whose programs include access to healthy foods, social services, housing stability and supportive services. VEAP is one of the only social service agencies that assist Edina residents with housing advocacy and financial assistance. VEAP supports low-income renters to maintain safe and stable housing by communicating with property management and negotiating payment arrangements, a need which could increase as job hours are cut or job loss occurs. VEAP also provides limited emergency rent assistance to help maintain housing stability and prevent homelessness. Typically rental assistance is available for 3-months within a 12-month period. However, with case management review of the applicants' situation and need, and ability to overcome the financing crisis, assistance may be allowed for up to 6-months. West Hennepin Affordable Housing Land Trust/Homes Within Reach: Since 2001 HWR has helped Page 28 of 63 over 200 workforce families achieve homeownership throughout 14 west Hennepin suburban communities. Just shy of 30 of their land trust homes are in Edina. Twin Cities Habitat for Humanity: Since 1985 Habitat has partnered with more than 1900 families in the Twin Cities achieve homeownership. They have acquired 6 houses in Edina, of which 3 have been sold to homeowners with the land placed in the Land Trust. City staff will inform HWR and TC Habitat (combined "partners") of a potential house. Our partners will inspect, negotiate an offer, and buy the home. Whichever organization buys the house will prepare a scope of work, engage their contractors and complete the work scope. The first priorities are health, safety and code issues. The second layer is increasing energy efficiency and complying with the Green Communities requirements. Our partners have their own list of potential homebuyers that they attract through their marketing efforts. The partners individually vet and work with through the approval process. As the land beneath the homes with be placed into the Community Land Trust with HWR, the TC Habitat buyers must also comply with the HWR requirements. Mount Olivet Rolling Acres: MORA’s mission is to “…enhance personal growth for people with disabilities by offering unique services supported by a caring, dedicated and knowledgeable team.” They began in 1953 as a camp for children with disabilities but expanded “to include children, adults and seniors with disabilities, mental health diagnoses, brain injury and other needs.” One service is owning and managing two residential homes in Edina that have 24/7 staffing, serving 3-4 residents each. The homes serve very low-income people with disabilities and are in need of rehabilitation to address safety and accessibility concerns. Resources/Financial Impacts: • Budget –Today's request 2025 allocation of $875,381.99 in LAHA, as this is new money with no previous budget. It is a Metropolitan Sales Tax that was authorized by State Legislation that has restricted in how it may be used. • Implementation – Staff will implement with HRA authorization. • Operation – This funding source will need to be tracked with reports due to the state. A unique budget code has been assigned. Funding to third parties will be secured by funding agreements. Relationship to City Policies: This proposal aligns with the Comprehensive Plan. Budget Pillar: Reliable Service Livable City Better Together Values Impact: Sustainability Both the Affordable Ownership Preservation Program and MORA focus on rehabilitation rather than new construction, which extends their useful life and saves them from the land-fill. As funding is available, energy upgrades will be incorporated into the scope of work. Health All three programs address housing stability, which is a social determinate of health. Stable, affordable housing reduces stress and allows for additional financial resources to be directed towards food, Page 29 of 63 medicine and other health enhancing items. Stewardship These programs are aligned with the intended use of the funding. They are directed to assist current residents and also future generations of home-buyers. Providing emergency rental assistance to Edina renters who need it helps these residents remain in their homes. The Affordable Ownership Preservation Program addresses the expressed interest to create more affordable home-ownership opportunities. Our partners in this endeavor, Homes Within Reach and Twin Cities Habitat, are reaching the end of the funds the HRA previously awarded to them. MORA will also benefit by using the funding to make their homes safer and more accessible. Equity Supporting emergency rental assistance, affordable homeownership, and homes that serve people with disabilities serves historically underrepresented groups in Edina. The funding also helps reduce barriers to both remaining in Edina and buying a house in Edina. Engagement The programs foster inclusivity by supporting lower-income Edina residents as valued members of this community. Supporting Documentation: 1. Staff Presentation Page 30 of 63 Local Affordable Housing Aid (LAHA) Stephanie Hawkinson Affordable Housing Development Manager August 28, 2025 Page 31 of 63 What is LAHA? In 2023 the State Legislature approval a local area sales tax to support affordable housing. Local Affordable Housing Aid is referred to as LAHA. In 2024 the legislature clarified that these funds are to augment rather than replace existing local support for affordable housing. Aid is distributed directly to the Cities. Page 32 of 63 LAHA Requirements Use of Funds: •Any funds distributed under this program must be spent on a qualifying project.* Qualifying Projects: •Emergency Rental Assistance •Financial Support to Non-Profit Affordable Housing Providers •Construction, acquisition, rehabilitation, demolition or removal of existing structures, construction financing, permanent financing, interest rate reduction, refinancing to provide affordable housing to those who earn less than 115% of AMI (homeownership) and 80% AMI (rental) •Financing the operations and management of financially distressed residential properties Funding of supportive housing •Costs of operating emergency shelter facilities, including services *Additional requirements detailed in Minnesota Statutes 477A.35 Page 33 of 63 Proposed Use of 2025 LAHA Deadline: Funds must me spent by December 31st of the fourth year after aid was received. Total Allocation: $875,381.99 •VEAP – Emergency Rental Assistance $200,000.00 •Affordable Ownership Preservation Program $581,881.99 •Mount Olivet Rolling Acres - Rehab $ 93,500.00 Page 34 of 63 1. VEAP - $200,000 Volunteers Enlisted to Assist People •VEAP offers caring, professional support to help stabilize people’s housing and financial situation and they help create an individualized plan to access resources. •Their values: Compassion, Collaboration, Inclusion, Innovation, Responsiveness, Integrity. •Have been in operation for 50-years Photo credit: VEAP Page 35 of 63 History of Giving Beginning April 7, 2020 the City Council approved a $100,000 grant to VEAP for Emergency Rental Assistance In July 2020, an additional $400,000 was granted through the CARES Act In February 2022, VEAP granted $300,000 out of ARPA proceeds In December 2022, VEAP granted an additional $166,607 out of ARPA proceeds In August 2024, VEAP granted $100,000 in LAHA 6Page 36 of 63 Program Criteria •Emergency, not long term, rental assistance. •Helps household through life changing event or crisis– illness, loss of job, death of income earner. •Typically assistance for 3 mos. but will allow up to six months if case worker deems it is warranted and will help renter overcome short-term crisis. •25% of award may be used for staffing and administration. •Edina LAHA will serve Edina residents. Page 37 of 63 Loss of Federal Funding Family Homeless Prevention and Assistance Program Emergency Food and Shelter Community Development Block Grants Eliminated Not Active Dramatically Reduce yet the need continues…. …According to Eviction Lab, in Hennepin County there are 2.9 evictions for every 100 renters Page 38 of 63 Serving Edina Residents 2024 2025**Total VEAP Edina LAHA 23 8 31 VEAP FHPAP* 1 1 VEAP Funds 13 13 VEAP Hennepin CDBG* 19 19 VEAP Senior Bridge Subsidy Fund 1 1 Grand Total 56 9 65 * Federal budget cuts eliminated or dramatically reduced these sources. ** Reduced numbers due to internal staffing issues and misunderstanding of contract. Issue resolved. Page 39 of 63 Who has been Served •Only Edina residents served with Edina based funding •654 households between April 2020- July 2025 •Households with income up to 50% AMI ($66,200 for a household of 4) with the majority of assistance serving households with incomes up to 30% AMI. •Seniors, families with children, individuals •Households ranging from 1 to 8 people Page 40 of 63 2. Affordable Preservation Ownership Program - $581,881.99 Goals •Preserve homeownership opportunities for low-to-moderate income households •Retains community and homeowner wealth •Enhances residential stability •Preserves long-term housing affordability •Serves households with incomes 60%-80% AMI (< $105,000 for a family of 4) Photo credit: Homes Within ReachPage 41 of 63 Funding History and Leverage Estimate of Gap per Home: ~$300,000 Affordability Period: 99-years Funding remains for ~6 homes. The 2025 LAHA funds would allow for 2 more. Habitat HWR Both Orgs Remaining Edina AH Trust Fund $ 3,000,000 $ 3,300,000 $ 1,046,932 Met Council LHIA*$ 750,000 $ 368,300 State Trust Fund*$ 150,000 $ 150,000 2024 LAHA $ 239,342 $ 139,342 $ 1,704,575 *Must match non-state source Page 42 of 63 Program Process The City mailed postcards to every homeowner of houses valued up to $425,000 Interested home sellers contact city staff who makes introductions to HWR and Habitat HWR and Habitat decide whether to and who will buy and rehabilitate the house House sold to income eligible homeowners Land placed into a Land Trust to assure affordability for 99-years HWR/Habitat draw LAHA funds for acquisition and rehab Sales proceeds less expenses used to support future home purchases Page 43 of 63 Program Impact (since 2021) •22 houses bought with support from the City (plus 3 pending). •Houses were sold to end-buyers for roughly $200,000. •17 houses are now owned and occupied; many by families with young children (1 more pending). •Home ownership made a reality for a researcher, educator, utility worker, chef, family advocate, etc. •Homes remain affordable for 99-years Photo credit: Homes Within Reach Page 44 of 63 3. Mount Olivet Rolling Acres - $93,500 •501(c)3 nonprofit corporation •Founded in 1965 •Provides residential services •Serves people with intellectual, developmental, and other disabilities as well as aging related challenges •Licensed by the State of Minnesota •Owns and operates two homes in Edina serving ~8 people Page 45 of 63 Overview Edina Home •Home acquired in 2015 •Stable occupancy - Three of four residents are original occupants •Serves people with intellectual/ developmental disabilities Sherwood House •Home acquired in 2001 •Stable occupancy – housed 8 people since opening •Serves people experiencing mental health challenges Page 46 of 63 •All residents qualify for Medical Assistance with incomes well below 80% of AMI. •Annually there is a comprehensive income and asset review. •Residents’ support is threatened with funding cut due to overall cuts Medical Assistance Financial Overview •Both homes were acquired with financing from the Edina Housing Foundation •One Mortgage has been satisfied, the other is current •State funding provides minimum increases for staff, but none for home repairs or upkeep. •Funding for home maintenance and repairs require contributions from individuals, foundations, businesses, etc. •In 2025 Capital Costs for all residential homes at MORA was $1.6 million Page 47 of 63 LAHA Request Edina Home - $36,000 •Improve safety and accessibility of 4-season porch •Fix garage floor to remove tripping hazards •Exterior and interior painting Sherwood Home - $57,500 •Replace deck for safety and accessibility •Update landscaping for residents and neighbors •Remove dead trees for safety •Parking pad for client vehicles Page 48 of 63 Questions? Page 49 of 63 d ITEM REPORT Date: August 28, 2025 Item Activity: Approve Meeting: Housing & Redevelopment Authority Agenda Number: 7.2 Prepared By: Stephanie Hawkinson, Affordable Housing Development Manager Item Type: Report & Recommendation Department: Community Development Item Title: Edina "Heroes" Down Payment Assistance Program Action Requested: Approved $1,000,000 from the Southdale TIF Pooled Fund for the "Heroes" Down Payment Assistance program, and authorize staff to engage the City attorney to draft a grant agreement with the Edina Housing Foundation and to modify loan documents to reflect program parameters. Information/Background: Background: During the first two quarters of 2025, there were three HRA Work sessions focused on setting affordable housing priorities. The HRA discussed two main goals: 1. Preserve NOAH single family ownership; and 2. Provide homeownership down payment assistance to people who work in Edina, such as hospital/health workers, educators and all people who work in the school district(s), police, firefighters, Public Health employees and other eligible public employees. Although the Come Home 2 Edina (CH2E) program did help these groups of people acquire NOAH homes in the City, the program also served anyone who wanted to live in the City regardless of where they worked. However, CH2E has been suspended due to limited resources. Proposed New Pilot Program: An offshoot of the CH2E program to serve Edina “Heroes” that fit the job classifications described above. • Loan size $100,000 max. • Co-terminus with first mortgage, with principle deferred until term or sale. The loan would be shared appreciation or interest only. • Income limit is 115% of Area Median Income (household 3+) or 100% AMI (1-2 person) • Max home value $600,000 • Proof of employment within the City at time of the loan For First Generation buyers, an additional $20,000 structured as a forgivable loan would be available. Amount Requesting: $1,000,000 from Southdale II TIF Pooled fund. The current balance is approximately $6M, so $5M would remain in the pool. Definition of Hero: There are national and local “Heroes” programs that have similar definitions. For this program, the applicant must currently work in the City of Edina. • Municipal Employees: Page 50 of 63 o Firefighters and EMS: All ranks of active full-time firefighters and volunteer firefighters, paramedics, AEMTs and EMTs. o Law Enforcement: All ranks of federal, state or local law enforcement; active police officers, troopers, correctional officers, and 911 dispatchers/operators. o Other public employees: Public Works, Parks and Recreation, Public Health, etc. • Healthcare Professionals: All active nurses, doctors, surgeons, specialists, technicians, assistants, educators, trainers and other medical healthcare workers. • Teachers and Educators: All active teachers, educators, professors, special education, assistants, counselors, librarians and administrators. Resources/Financial Impacts: Budget: The request that the pilot program be funded with Southdale TIF pooled funds that are allowed for affordable housing endeavors. The finding would be granted to the Edina Housing Foundation who will lend the money to program participants. The program guidelines must adhere to TIF regulations. The First Generation portion of the assistance would be forgivable loans. Implementation: The Heroes program would be administered by the Edina Housing Foundation, with Community Development Department staff providing assistance and administrative oversight. The home buyers' Mortgages and Notes would be with the Edina Housing Foundation. The Edina Housing Foundation has a contract with CEE to service the loans. Relationship to City Policies: A program to provide financial assistance to income-eligible households who want to move to Edina in ownership housing is supported by the Comprehensive Plan. Budget Pillar:Use text snippets to include pillars on the item report. Livable City Values Impact: Engagement The priority to enable affordable ownership housing has been repeated among community surveys and is embedded in our Comprehensive Plan. The direction came from the community engagement process. This program specifically creates opportunities for people who already work in the community to move here. It creates an opportunity for these workers to live in the community they serve. Sustainability The "Heroes" program assists homeowners to buy moderate priced homes in the community, thus preserving the homes. Health The Heroes program addresses housing cost burden, and alleviates stress associated with a higher percentage of a household's income going to housing costs. The down payment assistance reduced the first mortgage obligation. Only 25% of a household income needs to be applied towards the first mortgage expense. Equity The Heroes program makes homeownership accessible to people who work in the City, and serve Edina residents, yet may otherwise not be able to afford to own a home here. It provides an opportunity to give these home buyers access to the services that they provide. Supporting Documentation: Page 51 of 63 1. Presentation Page 52 of 63 Edina Heroes Program Down Payment Assistance for Home Purchasing Page 53 of 63 Goals •Preserve NOAH single family ownership; and •Provide ownership downpayment assistance so that people who work in Edina providing services to Edina residents can live in the City they serve. Logo for Florida’s Hometown Heroes Program Page 54 of 63 Program Guidelines •Maximum loan size $100,000. No more than 25% of home value and 25% of gross income applied to PITI •Co-terminus with first mortgage, with principle deferred until term or sale. The loan would be shared appreciation based on resale formula •Income limit 115% of AMI ($137,080) for 3+ households or 100% AMI ($106,000) for 1-2 person households. •Max home value up to $600,000 •Proof of employment within the City at time of the loan •For First Generation buyers, an additional $20,000 structured as a forgivable loan Page 55 of 63 Eligibility •Municipal Employees: •Firefighters and EMS •Law Enforcement •Other public employees •Healthcare Professionals: All active nurses, doctors, surgeons, specialists, technicians, assistants, educators, trainers and other medical healthcare workers. •Teachers and Educators: All active teachers, educators, professors, special education, assistants, counselors, childcare, librarians and administrators. Image from South Carolina’s Heroes Program Must work in Edina at time of Application Page 56 of 63 Funding Request •$1M in Southdale 2 Pooled TIF funds •Grant to Edina Housing Foundation (“EHF”) to own and administer the Heroes program •EHF will underwrite the loan, and prepare Notes and Mortgages same as the process used for CH2E •EHF contracts with Center for Energy and the Environment (CEE) to service the loans Page 57 of 63 Edina Housing Foundation •Created in 1985 to administer a second mortgage program. •Designed and implements the “Come Home 3 Edina” program since 2007. •Originated 183 loans, totaling $8,924,459 •CH2E leveraged $40.8M in home sales •Mortgages and Notes owned by the Foundation Page 58 of 63 Security •Recorded Mortgage •Note •Shared appreciation: borrower repays principle plus a portion of the appreciated value based on the limited equity model. Page 59 of 63 Next Steps HRA/Staff •Prepare a Grant Agreement with the Edina Housing Foundation for HRA approval •Return to HRA for final approval of the Grant Agreement •Modify Note and Mortgage to comply with Heroes program parameters Edina Housing Foundation •Implement the program •Qualify program applicants Page 60 of 63 Alignment With Budget Values Engagement: Responses to community surveys and Comprehensive Plan goals derived from a community engage process call for more affordable ownership opportunities. It creates an opportunity for these workers to live in the community they serve. Sustainability: The "Heroes" program assists homeowners to buy moderate priced homes in the community, thus preserving the homes. Health: The Heroes program addresses housing cost burden, and alleviates stress associated with a higher percentage of a household's income going to housing costs. The down payment assistance reduced the first mortgage obligation. Only 25% of a household income needs to be applied towards the first mortgage expense. Equity: The Heroes program makes homeownership accessible to people who work in the City, and serve Edina residents, yet may otherwise not be able to afford to own a home here. It provides an opportunity to give these home buyers access to the services that they provide. Page 61 of 63 d ITEM REPORT Date: August 28, 2025 Item Activity: Approve Meeting: Housing & Redevelopment Authority Agenda Number: 7.3 Prepared By: Scott Neal, City Manager Item Type: Report & Recommendation Department: Finance Item Title: Resolution No. 2025-06 Adopting the Proposed Budget and Establishing the Proposed Tax Levy Payable in 2026 Action Requested: Adopt Resolution No. 2025-06 Adopting the Proposed Budget and Establishing the Proposed Tax Levy Payable in 2026. Information/Background: The HRA is a separate taxing authority formed by the City Council in 1974. The purpose of the levy is to pay a portion of the administrative expenses and other economic initiatives that are necessary to operate the HRA. Historically those expenses have been paid using TIF funds. The levy proposed for 2026 shows an increase from $259,300 in 2025 to $267,100 in 2026. The HRA board must approve a preliminary 2026 tax levy at this meeting. In order to prepare you for this action, HRA staff will present our 2026 budget and levy recommendation. The final levy will be considered by the HRA in December. Resources/Financial Impacts: Relationship to City Policies: Supporting Documentation: 1. HRA 2026 Preliminary Levy Resolution No 2025-06 Page 62 of 63 EDINA HOUSING AND REDEVELOPMENT AUTHORITY RESOLUTION NO. 2025-06 ADOPTING THE PROPOSED BUDGET AND ESTABLISHING THE PROPOSED TAX LEVY PAYABLE IN 2026 WHEREAS, The Edina Housing and Redevelopment Authority (the “HRA”) has authorities and powers according to MN Statutes, Sections 469.001 to 469.047. MN Statutes, Section 469.033, subd. 6 grants the HRA the power to levy and collect taxes subject to a resolution of consent from the Edina City Council for a set period. WHEREAS, The Edina City Council passed Resolution 2025-73 consenting to an HRA tax levy payable in 2026. NOW, THEREFORE, BE IT RESOLVED by the Board as follows: Section 1: That there is proposed to be levied upon all taxable real and personal property in the City of Edina, a tax rate sufficient to produce the amount as follows: HRA GENERAL FUND $267,100 Section 2: That the preliminary budget is as follows: HRA GENERAL FUND TAX LEVY REVENUES $267,100 HRA GENERAL FUND EXPENDITURES $267,100 Passed and adopted by the Housing and Redevelopment Authority on August 28, 2025. ATTEST: James Pierce, Secretary James B. Hovland, Chair STATE OF MINNESOTA ) COUNTY OF HENNEPIN )SS CITY OF EDINA ) CERTIFICATE OF EXECUTIVE DIRECTOR I, the undersigned duly appointed and acting Executive Director for the Edina Housing and Redevelopment Authority do hereby certify that the attached and foregoing Resolution was duly adopted by the Edina Housing and Redevelopment Authority at its Regular Meeting of August 28, 2025, and as recorded in the Minutes of said Regular Meeting. WITNESS my hand and seal of said City this ____ day of __________________, 20___. _________________________________ Executive Director Page 63 of 63