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273083 WIiITE - CITV CLERK 1 PINK - FINANCE GITY OF SAINT PAUL ���� �� CANqRV - DEPARTMENT COUIICIl $ �� L BLUE - MAYOR � ` File N 0. ncil Resolution Presented By Referred To Committee: Date Out of Committee By Date WHBREAS, the Council of the City of 3aint Paul haa been requeated by the City's Planning and Economic Developnnent Department to approve a document entitled Neighborhood Commercial Rehabilitation Loan Program Guidelines for the City of 3aint Paul; and W�ERF,AS, this document revises and replaces a docimmeat adopted by the City Council on Septeznber 16, 1976, entitled Concept and Guidelines for the City of 3aint Paul Caarnercial Rehabilitation Loan Program; and WHEREAS, the Housing a�ad Redevelopment Authority (I�.tA) has �een designated by the Council of the City of Saint Paul as the Agency to coordinate the granting of the aforesaid loans for cammercial rehabilitation; and WHEREAS, the HRA Board has approved this aetion on May 23, 1979, NC1W, THEREFO�tE, BE IT RESOLVSD, that the City Council of 3aint Paul approves the doeument entitled Neighborhood Coflmnercial Rehabi.litation Loan Program Guidelinas for the City of Saint Paul. COUNCILMEN � Yeas Nays Requested by Department of: Butler In Favor planning and Economic Development �Iea�a- Hunt Q �, �� Levine _ __ Against By GarY E• Stout Maddox �,Y��Y `- � Show '� esco �-19"�9 Form Approved by City Attorney Ado ed by Council• Date _�Il1N ertified Y� ed by Cou tar}A BY t�ppr e by ;Navor: te � —�"7 �9�g Approved by Mayor for Submission to Council g By t�1►�� J U N 16 t979 ' . Gpc�.��c�� , ' j�°�-,;,� � �7zt>,/�. ;�f �- � �µ����� y� ,/ `-«_� /(�ir� �'C'� - R�C F� CITY OF SAINT PAUL INTER-DEPARTMENT MEMORANDUM ��� 1 1979 CO�NClL1AAN �'GN MADDOX May 30, 1979 T0: Members of the City Council FROM: Maureen L. McAvey ��1` SUBJECT: Revisions inihe City's Commercial Rehabilitation Program Attached is a copy of the City of Saint Paul Council -Resolution to be presented to you on June 7, 1979, requesting the approval of a document entitled "Neighborhood Commercial Rehabilitation Loan Program Guidelines for the City of Saint Paul." Also attached is the HRA Board Report listing the major revisions and a copy of the proposed guidelines. The HRA Board approved this action on May 23, 1979. � MLM: edl � �s.. � � WHITE - CITV CLEFiK PINK - FINANCE G I TY OF SA I NT PA LT L Council .CANARY�- DEPARTMENT � BLUE -MAVOR ' - File N . Council Resolution Presented By Referred To Committee: Date Out of Committee By Date WHEREAS, the Council of the City of 3aint Paul has been requested by the Gity's Planning and Economic Development Department to approve a document entitled Neighborhood Co�nercial Rehabilitat�.on Loan Program Guidelines for the City of Saint Paul; and WHEREAS, this document revises and replaces a document adopted by the City Council on September 16, 1976, entitZed Concept and Guidelines for the City of Saint Paul Commercial Rehabilitation Loan Program; and WHEREAS, the Housing and Redevelopment Authority (HRA) has been designated by the Council of the City of Saint Paul as the Agency to coordinate the granting of the aforesaid loans for commercial rehabilitation; and WHEREAS, the HRA Board has approved this action on May 23, 1979, NOW, THEREFORE, BE IT RESOLVED, that the City CounciZ of Saint Paul approves the document entitled Neighborhood Commercial Rehabilitation Loan Program Guidelines for the City of Saint Paul. .. . COUNCIL;�tEN Yeas Nays Requested by Department of: Butler in Favor planning and Economic Developmeat Hozza Hunt �y • �-e;�i��'�.-'� � Levine Against By GarY E. Stout _ Maddox Showalter �`�� Tedesco Form Approved by City Attorney Adopted by Councii: Date Certified Passed by Council Secretary BY B� Approved by Vtavor. Date Approved by Mayor for Submission to Council By BY .: � ,, � k� � - , . RE�ORT TO TNE CO�ii�ISSiONERS DATE M3y 9, 1979 ft EGA R D!N G REVISIONS IN THE CITY'S COMNIERCIAL REHABILITATIOV PRQ�RAI�i � Staff is requesting an authorization to replace a document passed by the Board oa Se�te-nber 16, 1976 called "Concept and Guidelines for the City of Saint Paul Coc�mercial Rehabilitation Program" with a document entitled 'hieighborhood Comnercial RehabiliCation Loan Program Guidelines for the City of Saint Paul." The r+.3jor changes are the £ollowing: 1. Simplification of guideline languaoe. 2. Addition of amendments approved by the Board since September 16, 1976. 3. Maximu;n loan amount increased from $25,000 to $4�J,000 for co�ercial rehabilitation use. 4. Residential rehabilitation hsve been included as an eligible expense ($5,000 per residential unit above commercial, up to eight units.) 5. The term of the loan allowed has been increased from ten up to twenty-years 6o Eligible areas have been added and expanded in accordance ioith the Ihpartment of Housing and Urban Developm�nt's eligibility standards and in conjunction with local development companies. The three new strips added are Arcade Street, Selby Avenue, and West-Seventh Street. , 7. Allowing an applicant to improve the appearance of his property without the requiremenC of a fu11 team inspection first, if he has a valid current "Certificate of Occupacy". Staff believes these new guideline changes will rid the program of problem areas and provide the City with an effective tool to maximize its neighborhood comenercia]. revitalization efforts on the City's older conm►ercial strips. EDD: AD�/edl '{ , . ,. ,� - , HOUSIPdG APdD REDEVELOPFiE�dT AUTHORITY OF THE CITY OF SAINT PAUL, MINPdESOT� AGEPJDA Regular hleeting DATE: +�IAY 23, 1979 � TIME: 1 :30 P.M. PLACE: COUNCIL CHA��BERS PUBLIC htARIPJG I . ROLL CALL II . APPROVAL OF MINUTES - h1EETING OF h1AY 9, 1979 III. REPORTS OF COh1MITTEES I`J. OLD BUSIf�ESS A. APPROVAL FOR CONSTRUCTION OF 4JENDY'S RESTAURANT Of1 THE llPJI-DALE ShOPPING CENTER SITE - DISTRICT 8 (Report to be submitted prior to meeting. ) V. NEW BUSINESS A. AUTHORIZATION OF EXECUTION FOR SALE OF PARCELS 2_, (SW COR. RGBERT Y� 1n00D) AND 3-A (S, HALF VACATED COLORAQO, 41.OF ROB�RT) , DIS4�IC� 3; SITE 212 (NE COR. NORTH & DESOTA, AP�D Nl�! COR. PAYNE & NORTH) , DISTRICT 5; P�RCELS 95-K A'dD 95-Y.2 (669 MARSHALL), DISTRICT 8 B. CONSIDERATION OF COh1iNERCIAL REHABILITATION LOAN, SPECIAL NEEDS CATEGORY, FOR DICK WILLI�P4S AT 32? MARIA AVEP�UE - DISTRICT 4 , C. P�iORTGAGE LOAN EXTENSION FOR GARDNER COP-IMONS, INC. - OISTRICT 9 D. AUTHORIZATION FOR ASSIGNMENT OF THE KESTER CORPORATION COiVTRACT TO STEPHEN B. AND VALERIE P. LAUGTUG - PARCEL 5-A (32 IRVINE PARK) - DISTRICT 9 E. CONSIDERATION FOR CHANGE IN TENTATIVE DEVELOPER PERIOD - OPJYX CORPORATION PRQPOSAt, PARCEL 131-B - DISTRICT 8 F. REVISIONS IN CITY'S COP�MERCIAL RENABILITATIOfV PROGRAt�I VI. STAFF REPORTS VII . APPEARANCES BY INTERESTED CITIZENS ��r�6 7 � g;� VIII . ADJOURNP�ENT �"� �o >>�, � No ao 3��� � � 1N�MaoN��3� � r� �S� ���� i ;� �%r'� '�� 6L`�1}�'�y�' � J _- ,������ `�9 ��>�.��,;,��,2 L �✓L r'EIGHBO�HOOD CO��IEP,CLAL REAABILTTATIO\ LO:�N PROG?�4'_•. GUIDELI�'ES ' FOR TFiE CITY OF SAINT PAUL I. Pi'?.POSE: To provide lo,�-interest, lon�er-tern Io�ns as an incentive for tenants and owners to upgrade the appearance of cocn�erciaL properties and the co.:��ercial area as a wzole. - II. LO��' TERI�IS AND CONDITIONS A. City�bank' participation -- the City and a bank wilL pa rticipate itt a loan on a matchino basis. ( In a $40,000 Ioan, the City's share and the bank's share each will be $20,000.) � B. Maximum loan -- shall not exceed the lesser of tne cost of rehabilitatio:� or $40,000 for co:n.-nercial use and $5,000 per residential uni.t above commercia2, up to eight units. C. Interest Rate 1. City's -- annuaZ rate of 2%. ==�- 2, Bank's -- allowed to charge u� to �n annuaL rate of tc,ro percent above the prime rate of interest at the tine of closing. 3. Eifec*_ive Annual Interest Rate -- shall be apprchiu��.tely one-nalf of customary rates offered for direct loans froc� private financial institutions. (See example below) . CO:L�IF,RCIAL REHABILITATIOV LOAN E�At•�LE ' 1 � ' City $20,0�� at 2% . - 2 Bank 20 000 at 12% ) IO years = $!�6!�/atortth $40,000 at 7% ) For 15 years = $359/manth ) 20 years = $3IQ/raonth 1 The City takes a subordinate position and has a set 27, interest rate 2 The lending institution is allowed to charoe u� to 2'/, above the existing prine interest rate. -+ • �1 . . _ � _ , D. Tenn -- the term allowed shall be up to 20 years. The bank sha11- make the determination for an appropriate tern relating to the - _ applicant's ability to pay. E. Collateral Required � 1. The bank shall have the sole responsibility o£ determining the applicant's credit risk. 2. The bank shall have first lien on any collateral required to mzet the applicant's credit criteria. F. Loan Disbursements -- payments to consulta�ts and/or contractors shall be made by the ban'� but n�t be=ore •written aPproval from the City is provided. , ZZI. ELIGIBILITY CRITERTA A. Areas 1. The following St. Paul neighb�rhood co�.mercia2 strips and areas m�et the Departm?nt of Housing an3 Urban Development's Co;�rnunity Developmant $lock Grant Funds (HtJD-CDBG) Year III eligibility standards for commercz.a� rehabilita.tion services: Address Range(s) a. East-Seventh 587 963 b. Arcade Street 661 I200 �. Payne Avenue 495 ' 1200 . , i; - 3 - . � d. Rice Street 431 I20I e. University Avenue _ 145 3+15 f. Snelling Avenue � ' 140 751 • g. Selby Avenue 239 I820 h. West Seventh Street 174 1305 ' - 2. Other interested coz�ercial rehabilitation applicznts must be located within HUD-CDBG Year III eligible areas (see attached map) and me2t "special needs" criteria described zs folloz�s; a. It is a minority-o:�ned and operated busir�ess. b. It is a busiaess unable to obtain a conventio�al Io3n from a private lender. (A letter from a 6an':: is required) . 3. Up to ten percent of the available commercial reh��ilitation resources ' can be spent on special nezd loans. B, Applicants 1. An applicant's co�nercial structure must be Iocatz� in one of the areas previously defined, 2, The applicant inay be: individual o��ners, partnerships, corporations, tenant operators or contract for deed purchasers. 3. An applicant must have the ability to repay the lo3n and be an acceptable credit risk as determined by a bank. 4. An applicant's property must conform to use under the City's Zoning Ordinance and use must be permitted under an approved District plan if applicable. . � 5. Upon completion of improvem�nts, the applicant's propzrty ��ust ca«pIy with all applicab�e code, permit and license requirements an3 must have a current certificate of occupancy. _ C. Improvements 1. Exterior Com�ercial Improvement Loan _ Under this type of loan an applicant ma.y improve the exterior app�arance of the building and property and will not be required to do any interior improvements if a�plicant provides a valid Certificate of Occupancy. St�ff approval of exterior design and all improve�ents is necessary, ��here applicable, the project must be in compLiaace �ith its respective area's design guidelines.) The following are eligible expenditures under this loan: a. All work must be ori front and,.sides of coc�nercial building facing public streets.' b. Cleaning, painting and staining of exterior surfaces. c. r:asonry repairs. d. Repairing or replacing of cornices, entrances, doors, windows, decorative details and awnings. e. Sign removal, repairing or replacement. _" - f. Architectural design services for plans and specifications. - g. Parking lots, including lighting, surfacing and Iandscaping. h. Building identification. - i. Other items that are viewed necessary to compliment exterior_ . • ��, - 5 - ' ` 2. Exterior-In�erior Commercial Improvzment Loan Upon upgrading the exterior appearance and the correction of all . health and safety code deficiencies (as recarded by the City Buildina Dzpartment) an applicant may include other fixed interior improvec:4nts among his work. In addition to the eligible expenditures listed previously under the exterior commercial improvement loan, the follo;�ing add.itional expenditures are eligible: a. Almost all fixed improvements including the repair andjor decoratio� of walls, ceilinos, floors, lighting, windows, doors, entrances, electrical, plu-nbing, mechanical, air-conditioning, architectaral change, insulation, etc. b. Ex�ansion of a cor,mercial structure �will bz allowed if: (1) Exterior icnprovements and healtn and safety code deficiencies will be corrected as part of the loan. (2) The expansion or addition w�ll not detract from t he app�ar.ance of either existi ng structure or the surroundin� area. (3) That it meets all zoning, parking, p�rmit, license require�ents, etc. c. Professional fees -- corranercia2 rehabilitation loan monies m3y be used for the purpose of paying reasonable engineering, architectural and other related service fees necessary to plan, estimate costs, etc' 3. Exterior-Interior, Commercial-ResidentiaL Improvement Loan Under this program the residential portion of the building may be included providing all requirements of the exterior-interior commercial program � , . ,; - 6 - are met and all code deficiencies are corrected in the residential portion as w��ll. �. Co:r�iercial Rehabilitation/Sm�.'ll Business Administration"502" Loan Any of the above three listed loans ma.y be used as the local " ' developm�nt company's injection in a Snall Business Admiaistration "502" lean. This will leveragz other private and public funds and allo;a greater project flexibility. The use of these funds ciould remain constant with all c oaenercial rehabilit3tion guidelinzs. D. Ineligible Costs . a. Refinancino existing debts b. Non-fixed improvements c. Working capital d. Inventory � . - e. �w•aat equity -- paymerit for the applicant's o�an Iabor and performance for construction or improvements. E. I�provements Completed Prior to Loan Closing Such improvements are not eligible unLess the applicant's structure requires im�r.ediate attention (hazardous code dsficiencies, .etc.) and the following � ste�s are undertaken: a. Applicant must fill out commercial rehabilitation loan application with. the City. b. Applicant must submit a written request to the City describing the need. c. Applicant must submit a written permissicn fro� b oth the City and a bank, . ' • j� � � � I • � d. If. the above conditions have been met, the applicant �aay proceed using his own funds or interin financing from a bank. However, this is done at the applicant's and/or . bank's own risk until the total scope of work has been approved by staff and the loan teas been closed. IV. CONTRA.CTII�G AND Ct�NSTRUCTION � A. All applicants sha1Z provide th� City with information on t he "Loan Application Form" detailing applicants interest regarding rehabilitation of building, giving parmission for code inspection and any other requested supplements necessary to achieve the City approval for this � proj�ct. B. A document (Scope of �dork) is to be subu,itted to the bank and to the City . detailing t�e wark to be performed, estic:�ted cost, specifically detailing ho:a the code work (when interiar work is part of the proposal) is to be satisfied and any ather documentaCion necessary to achieve - the City's approval for this project. C. Contractors providing work under this program are to be Iicensed and must meet the insurance and bonding requirements of the City. Th.e contractor is to be knowledgeable of and/or respansible for quality and workmanship, conducting proper business practices, be financially capable, and demonstrate that they are an Ec}uaI Opportunity employer. D. The quality and progress of the work is to be monitored throughost the term of the contract by the loan recipient. � ';. _ . . - . . - S - r�r;,��� , . ' � ; �'e . . � � E, Yayment requests (either partial or final) cannot be made to the contractor until a written request for payment is made and the loan recipient and the City have accepted the eligibLe improvements in writing. If the contractor requests periodic draws on completed work the draws shall be limited in amounts equal to the value of ' materials furreished and/or serviczs pe rformed at the time of requ�st. . Number of p�yments will be limited to three (3) incLuding final payment. All paymeats are to be sub��ct to a 107, holdback. The holdback may be used to correcC unsatisfactory work, to defray costs to o�tain a replace�nent contractor and/or to complete the project. The contractor is to furnish the necessary lien waivers for a1L payments. F. All work is to be covered by the nor,:31 required permits and approvals of affected agencies. G. All work must be inspzcted by the: City Building Department ta ins�re conformance �aith code and must be verified for proper completion by City staff to ins.ure compliance with sFecifications prior to final payment. H. All eligible improvement work performed pursuant to a commercial rehabilitation loan must provide a 12 month warranty from the date of accepted completion by the loan recipient and the City. This warranty caust cover the quality of materials used and warkmanship in perforraing the wor�:. ,.._._. _ � _ _ � . _ ��_. .�_._..�.._...�� _. `_____ �_.._� .._ ..... �. ___.. _---- � i� , ` ' ` �. _ � __ _��_--- --._ _— — -- - - _ . �� lst �j /� 2nd ' T--^v � 3rd���--� " �/'� Adopted___�� Yeas Nays BUTLER HUNT LEVINE �l o�� �;� MADDOX . SHOWALTER TEDESCO PRESIDENT (HOZZA) �