Agenda - Council - 01/08/2002 - Laserfiche WebLink

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I i I I I I I I I I I I I I I '1 I I CASE CONSIDER APPLYING FOR 2002 COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) FUNDS By: Community Development Director Sylvia Frolik Background: The County receives CDBG funds from the Department of Housing and Urban Development (HUD). Since 1981, Anoka County has opted to distribute these funds to cities and townships with qualifying projects. The amount of funds received by the communities was based on a formula using population, age of housing, and percentage of poverty. Commencing in the 2001 CDBG funding year, the County restructured the program and now offers the funds to municipalities on a competitive basis. Awards are based on applications consistent with the high or medium priorities of the County. Changing to a competitive based system requires less time tracking small, individual projects and provides more time for larger, community-wide projects. A maximum of 15% of the total CDBG grant to the County may be used for public service agencies and 20% may be used for planning and administration purposes. Proposed projects must meet one of the national objectives: benefit low to moderate income persons, eliminate slum and blight; meet an urgent need. The funds requested for any One project cannot exceed $300,000.00. Funds may be used for housing, public facility needs, senior and youth programs, infrastructure, planning purposes, economic development activities, and historical preservation. CDBG funds may be used for property acquisition and elimination of blight. The City does not have to have a specific redevelopment project in mind in order to acquire the property. The property can be used for affordable housing or economic development. If the City can't find a use that meets the national objective, they must pay the program back the fair market value, not what the actual purchase price, which is usually higher than fair market value. In order to meet the national objective for an economic development purpose, the company that develops on the property has to create one new low/moderate income employment position for every $35,000 of CDBG funds invested in the property acquisition. There must be a willing seller(s); CDBG funds cannot be used for eminent domain. Applications are due to the County by January i 1, 2002. Recommendation: Staff is requesting City Council authorization to submit an application to Anoka County for CDBG funds for the purpose of acquiring two blighted parcels in the industrial area for clearance and future redevelopment. This activity is ranked high priority on the County's 2000-2005 Community Development Goals and Priorities. A site location map is enclosed and Staff will have photos of the parcels available at the Council meeting. There have been preliminary discussions with the land owners and they are willing sellers. The estimated purchase price for the two lots is $270,000.00. -203-