97-349Council File # �R - 3 _4 9
Green Sheet # a�St
RESOLUTION
OF,$AIf�T PAUL, M�JVNESqTA
Presented
Referred To 1 __ _ _ _ _ , _ _ _ J O/ Committee Date
,ai,
WHEREAS, the Saint Paul City Council has engaged in numerous recent discussions regazding vacant housing and
neighborhood economic development strategies
WIiEREAS, the City Council recently adopted the City's Housing Business Plan, which calls for neighborhood based housing
developmet strategies and coordination of housing development with other private and public investment; and
WIIEREA5, the City Council recently discussed the CiJRA vacant housing study, which illustrated the importance of
rehabilitation of vacant housing; and
WI�REAS, the City Council is committedto rehabi]itatingvacanthouses andbuilding infill housing ]n acost efficientmanner;
and
WFTEREAS, the City Councii is committed to coordinating vacant housing rehabilitation and infill housing conshuction with
neighborhood economic development; now, therefore, be it
RESOLVED, that the Saint Paul City Council adopt the Capital City Development Progam; and be it
FURTf�R RESOLVED, that the City Council request the admuiistration to direct staff to implement the provisions of the
Capital City Development Program by 7une 1, 1997; and be it
FINALLY 12ESOLVED, that the City Council request that staff immediately convene a Cost Reducrion Analysis Focus Crroup
and that this focus group report to the City Council within six months after adoption of the plan.
Requested b epaztment of:
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Adopted by Councfl: Date \\ � ° �9
Adoption Certified by Council Se retary
BY� � , �--�� c) - � �!-�. ..�-�-.—�
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Approved by Mayor: Date _ _ _ _ _ _ _ _ _
Form Approved by City Attomey
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Approved by Mayor for Submission to Council
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�EPART�ENT/OFFICFJCOUNqL DATE INRIATED GREEN SHEET N_ 2 2 8 8 8
ci . conncil 4/2l97
iNRIAV�ATE INITIAUDATE
CONTACT PERSON 6 PHONE - . � � DEPARTAtENi OIRE � CT' WUNCIL
C011IlC]�I1CffibEIS �iLITIS�f21CC� ' N �UMB 'a EA FOR � GITYATTORNEY � CRYCIERK
MUST BE ON COUNCIL AGENDA BY (DA'S� pp�N� � eUDGET DIRECTOR Q FW. b MGT. SFAVICES DIR.
� G G ! '(� S a��� � MAVOR (OR ASSISTAM) � �
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TOTAL # OF SIGNATUH£ PAGES � (CUP ALL LOCATIONS FOR SIGNATURE) -
ACT70N HE�UESTED:
Creating Capitai City Development Program.
AECOMMENDA7roNS: Approva (A) or Aejea tR) pEHSONAL SERVICE CONTRACTS MUST ANSWER TNE FOLLOWING QUESTIONS:
_ PIANNIN6 COMMISSION _ CNIL SEFNICE COMMISSION �� Has thi5 per5ontlkm eY¢f Worketl unde[ d conttact far thi5 departmant?
_ C�B COMMfrzEe _ YES NO
2. Has Nis person�rtn ever been a ciry employee?
—'� — YES NO
_ D55a�C7 COUai _ 3. Does this peBOn/firm possess a skilf not normaily possessed by any curtent city emplayae?
SUPPORTS WHICN CqUNCIL 0&IECTIVE? YES NO
Explain all yes answera on seperete sheet end ettneh to graen sheet
INITIATiNG PROBLEM, ISSUE, OPPOflTUNITV (WM1O, Whar, WhBn, Where, Why).
ADVANTACaESIPAPPROVEO:
DISADVANiAGESIFAPPRWED: �
DISADVANTAGES IF NOT APPROVED:
TOTAL AMOUN7 OF ipANSACT10N $ COST/REVENUE BUDGETED (CIRCLE ONE) YES NO
FUNOlNG SOURCE ACTIVI7V NUMBER
FlNANCIAL INFORMATION: (EXPLAIN)
q� •�y9
Capital City Development Program
Background
Discussion of costs associated with new infill housing and housing rehabilitation has been
ongoing for neazly a year. The discussion was prompted by the City CounciPs review o£ a
waiver of Aouses to Homes guidelines for increased subsidies on several developments.
Councilmembers have been concerned about the effactiveness of the program, the level of
subsidy, the impact on the neighborhaod and the impact on the City tas base. Pursuant to these
discussions, the City Council acting as the IiRA decided to lower the subsidy for the Houses to
Homes program. Subsidy limits had been set at $40,000 per single family and $60,000 for
duplex homes but were reduced to $20,OOQ and $25,OOQ respectively.
Subsequent City Council discussion in the first three months of 1997 of the City's Housing
Business Plan and the CURA report generated the impetus for the Capitol City Development
Pian. The Capital City Development Program (CCDP) is a proposai in response to policy
discussion generated at the Saint Paul City Council related to housing rehabilitation and
commercial development. CCDP desires to:
• target development geographically to coincide with other development and invesiment;
• decrease bureaucratic and administrative costs through larger scale development
contracts;
• decrease construction costs by el'uninating onerous buiiding requixements in an effort to
make public resources stretch further; and
• improve the flexibility of public funds by continuing to collapse program resources into
fle�ble funds available to neighborhood housing and development organizations..
This proposal xepresents a starting point for fiu�ther discourse based on the suggesfions of
Councilmembers, City staff and the community.
The Current Environment
There are nine community development corporations operating in the City of Saint Paul that
have used the Houses to Homes program dollars to rehabilitate vacant housing Citywide. Due to
a number of factors, including availability of vacant homes, the process by which the City
condemns a building, availabiliry of funds, high aquisition costs of H[JD homes, and high
tumover of H[JD homes, targeted development of specific block azeas has been probiematic.
Typically the geographic area encompasses the border of the azea served and is used as the
reference point for targeted areas.
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Coxnrmunity development corporations also serve the business community and aze a focal point
through which businesses gain access to monies and introductian to the City resources. These
aze the neighborhood connecrions through which the City moves some grant and low interest
money to neighborhood businesses.
There are also other agencies that provide housing rehabilitation services to the community such
as Rondo Community Land Trust, Habitat for Humanity and Project for Pride in Living to name
a few that are important to creating a stronger capital city.
Private developers also play an important role in the development of housing, commercial
property and attracting new ancUor expanding businesses to the City of Saint Paul. The Port
Authority and PED are accessible to these private developers. It appears that some brownfield
money may be available along with Tax Increment Financing (TIF) to continue the development
of underutilized commercial property in Saint Paul.
Business associations throughout Saint Pau1 have played a key role in atkracfing new businesses
to emerging commercial areas. They are a unique vehicle to get funds to businesses and also
serve as conduits for City resource information to businesses.
Capital CitY Develo�ment Program Scope and Fundi�
The Capital Ciry Development Program wiil realign City development objectives with
neighborhood-based proposals for housing and business revitalization. The program will target
specific residential and commercial areas and require strategies for rehabilitation of vacant
homes, housing rehabilitation, rental rehabilitation, and commercial development.
The CCDP would be comprised of two funds; Capital City Homes and Capital City Business
Development. Capital City Homes funds would be available for new infill housing, vacant
building rehabilitation, and rehabiltiation of homes. Customers could include community
development corporarions and private nonprofit and for-profit developers.
The following funding sources should be examined for inclusion into the Capital City Homes
fixnd. If inciuded, 60% of these funds would be dedicated to Capital City Homes and 40% would
remain far citywide use:
• Scattered site Tax Increment Financing for blighted and vacant land
• The Houses to Homes Progratn
• Home Loan fund - Deferred Loan Program
• HOME
For those development contracts that participate in Capitai City Homes and utilize the Houses to
Homes Program, the $20,000 and $25,000 subsidy limits would no longer be applied to each
individual house, Instead, the entire proposal would be limited to a total gap subsidy equal to the
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sum of the maximums available for each home within the proposal. This subsidy could be spent
at the developez's discretion. In other words, if a development contract called for six vacaut
single family homes and two vacant duplexes to be rehabilitated, the totai amount of Houses to
Homes dollars available would be $170,000 (6 x$20,000 plus 2 x$25,000). Under Capital City
Homes, this $170,000 total could be divided among houses within the development contract in
any fashion.
Capital City Business Development funds would be available for commercial rehaMlitation and
business development. Customers could include community development corporations, business
associations, and private nonprofit and for profit developers.
The following funding sources should be ex�mnied for inclusion into the Capital City Business
Aevelopment fund. If included, 50% of these funds would be dedicated for Capital City
Business Development and 50°!o would remain for citywide use:
Commercial Rental Rehabilitation
Commercial Development
Enterprise Leverage Fund
Criteria for Develo�ment Pro_posals
To avoid an influY of proposals that request waivers to deviate significantly from program
guidelines, it is neccessary to outline specific criteria. SpecifiCity will also help guide
developers, who will be operating under a different process than in the past. To meet the stated
objectives of the CCDP, the criteria for successfiai development proposals should include the
following:
a development area with the presence of other private or pubiic investments such as
residential street paving, community center construction, school improvements, or
investment in a local commerical center;
demonstrated adtninistrative or conshuction cost savings within the proposal due to
targeted geographicai impact or economies of scale;
a statement of eligibility for the development area with respect to the following eligibility
requirements:
1) proximity to a number of vacant homes
2) proxunity to blighted land or property
3) a stated decline in properiy valuations within the development azea
4) a stated decline in the rate of owner-occupied housing; and
proposals that include use of both Capital City Homes Funds and Capital City Business
Development funds will be eligible for funding from both sources.
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Department of Planning and Economic Development
The Capital City Development program is an assimilation of current programs auailable to the
community. PED should continue to collapse and integrate programs to allow for more
fle�bility to addzess housing and commercial development concerns. If federal waivers are
needed to reduce requirements the City should contact the appropriate federal agencies. In those
instances where federal guidelines aze in place, a cleaz staxement of those guidelines and
tecluucal assistance should be made available to the neighborhood organizafion along with the
grant. All efforts should be made to use the most restrictive funding sources in areas that are
eligible for those sources, so that less restrictive funding sources can be used in other areas.
PED would issue funds in the form of block grants to the community organizations who sign a
contract with the City to expend those funds as indicated in their proposal. The community
organization(s) would be responsible far the use of the funds and would be available for an audit
of the program.
Cost Reduction Analysis
In addirion, a focus group of developers, housing specialists and business owners will be brought
together to address issues that drive cost of rehabilitation or development but have little or no
significant impact on the project. These issues might include sewer and water access, permit
costs, onerous construction requirements or other soft costs. For example, a sprinkier
requirement for new homes drives the cost of housing up from $3,000 to $5,000 per house, this
requirement only occurs in Saint Paul and hampers our ability to compete with surrounding
municipalities. A suggested change may be to modify the requirement to having smoke detectors
hardwired. Important topics for this focus group may also include:
construction costs
administrative costs
bureaucratic costs
PED will develop the focus groups and report back to the City Council on the cost saving ideas
generated by the group within six months of adoption of the program.
Action Plan
To facilitate discussion on these issues among City Council Members, City staff, and members
of the community, a series of resolutions pertaining to components of the Capitai City
Development Program will be introduced in the near future.
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R.ATI�NALE Ft3R CIB REVIEW OF CAPITAL CITY
DEVEL4PMENT "CONTRACTS"
1. "Sunshine" provision - Bring development "contracts" under
the same legislative cade provisions that govern
budget requests,
role of CIB.
part of the existing priar review
other capita.l
and comment
Unless there is an opportunity for such a review prior to a City Council hearing, the proposaLs
will be entirely products of staff negotiation, with no outside review or even guarantee of broader
neighborhood consensus. CIB or oiher level of prior review would aid ihe neighborhood and the
Councit by serving as a"sounding board" mdependent of staff review. (As is done now with
CIB/CDBG budget, and was done by a committee of the PLwning Commission with NPPs.)
2. Coordination with other budget processes.
Not only is there a need to look ai this progrem withm the broader coniext of total pnblic
investinent in an area (from sow�ces outside this program}, but there is need over time, to look at
ihe balauce of programming across all available fimd'utg sources (withm ttee program). This is
particularly important in that the Capitai City Development Fund is not intending to use a"eycle"
(application deadline) but to allocate and presumably modify prograws on a contract basis.
3. Geographical and program balance
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An outside review process wouitl provide oveisig�t on the ovetall distriibution of resources
among neighborhoods and 1yQes of progeam approaches. Such a review would aLso look at
issues of comgarability of approaches across PED "quadrauts," and relationsirips with
neighborhood organizations.
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PROFILE OF PR03ECT / PROGRAM REVIEW
EXAMPLE 1- SINGLfi PR03ECT, LTNIFIED CIB PROCESS
PRO7ECT: DAYTON'S BLiJFF RECREATION CENTER
DESCRIPTiOId: New buildiug and playground improvements
F[7NDING:
REVIEW PROCESS: Neighborhuod > CIB Community Facilities Task Force > CIB
Committee > Mayor > City Council
FOLLOW-UP: t7nce project is fvnded, departrnent proceeds. CIB would s�view any
major budget changes or fumre reqaests.
EXAMPLE 2- CI$ PROGRAM ALLOCATION, STAFF-ONLY SELECTION
OF PROJECT SITES
PROJECT: VACANT AND HAZARBOUS BUII.DING REMOVAL
DESCRIPTTON: Citywide fimd to demolish suuctures on a quick-decision needs basis.
FUNITING: 1946 -$1,000,000 CDBG. 1497 -$1,000,000 CDBG
REVIEW PROCESS: YED > CIB Residential and Economic Development Task Force > CIB
Committee > Mayor > City Council
FOLLOW-UP: CIB review only as budget line item, put of next fundiug cycle.
BXAMPLE 3- PROGRAM ALLOCATION, FI1TiJRE PROJECT REVIEW
PRO7ECT: CAPITAL MAI':�T'£E23ANCE PROGRAh4
DESCRIPTTON: Fund for r� of City buildings, facilities.
FCTNDING: 1996 -$1,40p,QaJ CIB. 1997 -$1,000,000 Cffi
REVIEW PROCESS: Budget Office > CIB Committee > Mayor > City Council
FOLLOW-UP: After allocation uf "fund" as a budget lme item, departmenLs submit
spec�c project requests > CIB/Staff sub-committee > CIB Committee
> Mayor > City Council (as a consent agenda item)
EXAMPLE 4-(NEV►� "INTERMEDIARY" PROGRAM FUNll, CONTRACTS
PROJECT: CAPTTAL CITY DEVEIAPMENT FiJND
DESCRIPTION: Combined-sowce neiglil>orhood redevelopment
FUNDINC: ??? CDBC + HOME + HRA, + Other
REV�W PROCESS: (for CDBrs program allocation) PED > CIB Residential and Economic
Development Task Force > CIB Comauttee > Mayor > City Council.
For other - ???
FOLIAW-UP: 13o review proposed for conuacts to CDCs, others. ConUracis are for more
than smgle site selection. CIB moniYOr of CDBG fimd balance.
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Rondo Community Land Trust
To: Counciimember Jerry Blakey
Counciimember Mike Hatris
From: Kris Nelson, President �'
Rondo Community Land Trust
Date: Apri130, 1997
Re: Vacant Housing and the Capital Citp Bevelopment Program
We appreciate the opportunity to comment on the Gapital City Development PrQgrasn at taday's
policy meeting. Enclosed 'is a draft in which we focus on the vacant and boarded building
procedure, the current rehabilitation snbsidy levels, as well as t}ie Capital Eity Develogment
Pragram., � � �.
� In parCiculaz, �ve urge that.subsidy Tey"els far rehabilitatioa be�sert at $40,6D0 for single fanlily �` �
homes in order for these su6sidies to be used most effectively. VJithin the Jast few years, Rondn
CLT moved �ve honses ta vacant lots wiChin the;Suinmit-University / Lexington-Hamline
neighborhoods-and rehabilitate,d tkie strgctures. Each home required more tl�an $20,060 in� '�- �
subsidp and would have been demolished without the,availability of kigher subsidies. The
house§ now generate t�es for the city and benefits fot the neighborhood.
We would,like to continue contributiugxo the policy drscussion surrounding the Gapital City��� - �� �
DevelopmentProgram. Please coniact us if you have qnestions or require additional inforniation
�; regarding this draft. �Thank you. � � _ � _ � � � �
1183 Ashland Avenue St Pau1, MN 55414 (612) 64Z-0862
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Objecfive
The following summary exaxuuies St. Paul's procedure for_vacant and boazded buildings,
addresses the subsidy levels for rehabzlitation as set by the Houses to Homes program, and
reviews elements of the Capital City Development Program. Conclusions aze as follows:
1. Rehabilitation and reoccupation of vacant houses must become a city priority.
2. Subsidies must be set at a leveI that enables quality rehabilitation to occur:
3. In the creation of mini-block grants, STEiR funds must be included to ailow for resource
flexibility, and other issues should be addressed.
Vacant Buildings -
According to the recent Houses to Homes study conducted by Edward Goetz, there is an average
of 475 vacant houses on the Public Health Vacant Building list at any time. These vacant
houses tend to concentrate within St. Paul's lower-income neighborhoods where negati�Fe;impacts
such as the depression of surrounding property, values and erosion of the properiy taY base are
heightened. Vacattt houses are potential assets and resources for the city of St: Paul. Benefits .
from investments in rahabilitated housing spill over into the cotiununitythrough an mipxoved tax
base and a stabilizaxion in. surroundingneighborhoods. The costs associated with demolition .
negate these benefits, ye{ the current nuisanee policy adininistered by the city of St, Paul
aggressively pnshes vacant houses to demolition. _ The:-rate of demolifion outpaces new
construction witlra widening,gap. It is our premise that the yacant houses within tke city are
resources to be preserved, and we ask the ciry of St. Paul to strongly promote rehabilitation and
� reoccupation as st eitypriortty. Demolition must be the i�st x"esort, not the goal. --
The St. Paul Legislative'Code outli�es the procedu�e for abatemerit of a nuisance properiy; .
however, it does not outline a clear process for involving, outside patties who may be interested
in zehaliilitating a property s�iould the owner not wish to do, so. Structurally, sound houses have .,,
beemdemoIisked in part beoause outside parties were not able to intervene early enough to sava .
the bnildings. We recommend that at th� time a vacant building is Legistered; City Council,
� neighborhood Community Development Corpoiations; other kousing'organizations, ths District .
� Counc�l and�city depaztrnentssuc�k as PED ar� no�ifiecT as well the owner. At this stage, ajoint ��:
meating.should be held between the.owner of record, Public Health an& the notified pacties to
deternane ne� steps and.#o create a plan for nse and/or demolifiion. The foundatian for-this
process is put foi in. the St. Paul Legislative Code; Section 43.03, number 4, which states, "The
period of tima tlie building is expected to remain vacant; and a ptan and timetabte for retttrning
the building to appropriate occupancy ar use andJor for demolition of the building". The goal is
to work witti oumers of vacant buildings in order to make an early determination of the status of
tkte vacant structure.
Subsidies
The original Houses to Horrzes program included the following objectives: `to save existing'
housing stoek, wfiere feasible; to recapture and improve the City's tax base; to inerease
hdmeownership-opportunities; to contribute to the revita�f�ationand stabilization of "" ,
a �,���
neighborhoods; and to address vacant buildings tt�rough better coordination and City focus
througJ� code enforcement, rehabilitation and demolition. Houses to Homes subsidies were
established at a level that would allow the creation of lugh quality housing to attract middle
income people to the city and to preserve historic structures. Subsidy levels were set at $40,OQ0
for rehabilitation for single-family vacant houses.and $60;000 for rehabilitation and conversion
of multi-family units to single units.
As concluded in the Houses to Homes study, subsidies for rehabilitation do zesult in a net cast for
the city; however, rehabilitation provides benefits tiiat average one-half of the original subsidy
(net cost: $21,866). Demolifion is associated with lower upfront costs (appro�mately $9,000),
and lower properiy valuesfor surrounding areas. "Although subsidy appeazs fo be a much more
costly alternafive upfront ($40,000 subsidy compared to no subsidy for demolition), affer a
systematic review of costs and benefits, the difference between the two strategies is closer to
$12,000" ($21-9}. Adequate funding can help insure that vacant buildings are reoccupied. It
must be deternvned whether the benefits derived through rehabilitation are woxth the additional
expenditure and whether cunettt subsidy levels enable the development of quality housing that
best serves the needs of the ciry and its.residents.
We propose that the Houses to FIo»aes program * increase subsadie"s to the leveds originally ",
established by the Ciry Council ($40,000 and $65,0(JO).
•Honses m Homes may be incorporated into CapiYal City Homes.
Cagital City Development Pragrafn (CCDP), . -
"As stated in PEJ7's Capital Improvement Program.and Budget Process (GiB) PrQposal, flexible
- fmancing is needed to"assist variaus gzoups and individuals -in nndertakiug an assortment af .
hoine oreafion or improvemeut projects. Streamlining the funding procedure by collapsing
various programs and funds under one umbrella and disbursing mini-block grants, therefore, wili,- "
,� be benaficiaL STAIZ funrLs�shoulc�be included ivithin the urizbrelta, as the,se funds are the inost .. �
unresiricted resources available. Althougfi tfie STAR furids are most fleatible, the current"
application guidelines are cumbersome and this has, in effect, reduced the number of applicants'
to.the prograzn. The STAR eriteria ahould be reviewed to-determine ways in which flie fnnds can
be more readily accessed., � � , ,� � � � � � �
One goal of the CCDP_is to °decrease construction costs by eliminafing onerous btulding
requirements, in an effort to make public resources stretch further". Legislative meetings have
been held to address city requirements tfiat add unnecessazy cost; however, State Uniform
Building Codes supersede, City building code requirements. . We suggest, therefoxe, that St. Paul
and othermunicipalities crekte a separate taskforce to make recommenclations on possible State "
code changes.
Finally, each development project is unique. While predeternuned criteria are helpful in defining
city parameters, these criteria must be fle�ble iri allowing neighborhoods to define what
constitutes a priority. Also there must be adequate PED hausing staff to assist the neighborhoods
with development proposals. � � �
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Recommendations
Tjacant Building Procedure
* Rehabilitation and Reoccupation of vacant houses should be a city priority, with demolition as
a last resort. �
*Create a notification procedure at the front end of the vacant building process. City Council,
neighborhood Distr'tct Councils, Community Development Corporations, land irusts and other
groups-shouid be notified during the vacant building registration process. A meeting should be
held between these groups and the owner to make an eariy determinatian of a.feasibie plan for
reoccupafion, rehabilitation or demolition..
*If rehabilitation or reoccupafion is not feasible, salvaging the building materials should be a
priority.
Subsidy Zevels -
*As under the Houses to Homes program, subsidies for rehabilitation should return to their ..
original� levels: � �
$40,000 for a single familyhouse and $6Q,OOQ for.conversion of multi-family units to a singie-
family unit. � � � � . _ � �
*For historic houses, a.separate fund shoutd be administered for those,projects exceeding the ,-,
subsidy limits of $40,000 and $6fl,0�0.
� CCDP. � , ° � � � � � � _
�� *IncIude STAR fdnds°in.t,he Capital City Homes grogram.. Reexamine STAR criteria in ozdai"to
�- � � m�ke this resource more xeadilg auailable for use. � � � � �
` *Because State Uniform Building,Codes supersede City codes, St. Paul and otfier municipalities _
', should form a task force to review wluch state codes oouid be. changed to make them more cost
, effecfive.
*Ensure that there is adequate PED staff to assist neighborhoods with development proposals.
Also PED and neighborhoods should use the same type of softwaze package for development
projects.
httpJ/freedom.stpaul.g.../legislative/Ic043.htm1
f. Condemned and illegally occupied; or
http://freedomstpaul.govlstpauUlegislariveQc043.htmi
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g. Unoccupied for a periDd o£_time over three hundred sixty-five (365) days and
during which time the enforcement officer has issued an order to correct nuisance
conditions_
i0rd. No. 17862, I�section]7 1, 8-13-91) _ -
Sec. 43.03. Vacaat building�registration.
(a) The awnes shall register with the enforcement o£ficer not later than thirty (30)
days after any building zn trie city becomes a vacant building, as de£ined in section
43.02 (7) . .. - � .
(b) Trie registration sha11 be submitted on forms provided by the eaforcement officer
and shall include the following infoxmation supplied by the owner: �
il) A description of the premises;
(2) The names and addresses of the owner or owners;
(3) The names and addresses o£ all known lienholders and all other parties with an
ownership interest in the buildiiig; .
�--�(-4) The pesiod of time the building is expected ta remain vacant; and a-plan and
time'table for returning the building to appropriate occupancy or use.andfor for
demolition of the.building.
(5) A copy of any current Truth-in-Sale of Housing Disclosure Report as required by
Saint Paul� Le�islative Cod'e Chapter 189., � � � " � - " _ , " - � - , - . ,
(c) The ow�er,.shall submit a plan and,timetable which must meet trie approval of the
enforcement officer. The enforcement'officer shall xequire completion oE tfie plan
within a reasonable perj.od of time, up to three hundred sixty-five (365) days.,.The
plan subrr[itted ehall ;comply with the provision of Chapter_33 of the Sairit Paul -
I,egislative Code. Any repairs, improvements or alterations to the must
comply with any applicable housing or building codes.
{d) All applicable laws and codes sha11' be comglied_with.by the owner. The owner-
shall notify the enforcement officer of any changes in information supplied as part
of the vacant building registration within thirty (30) days of th'e change., Zf the
plan or timetable £or Ehe vacant building is revised in any way, the revis3ons must
meet the approval,of the'enforcement officer. -
`: (e) The owner and the subsequent owners sHa31 keep the building,secured and safe and
the bui2ding and ground properly maintained until the rehabiTitation or demolition
has been completed.
'(f� Fail'ure of the owner or any subsequexit owp.Ar to maintain the and� _
premises that resul£ in a summary abatement completed by.the city,shall be gronnds
for revocation of the approved�_plan and,shall be subject'to any applicable,penalties
provided by law.
(g) The new.owner(s) shall�register or re�-register the vacant�bu3lding with the �
enforcement officer within thirty (30)�days of any transfer of azi ownership interest-
in a vacant building. The new owner(s) shall comply with the approved plan and
timeCable svbmitted by the previous owner until any proposed changes are submitted
and meet the approval of the enforcement officer.
th) Vacant building £ees:'
(1) The owner of a vacant building shall pay an annual�fee�of�two hundred dollars.
($200:00) for the period the building��remains a vacant building. The fee shaZl be
reasonably related to the administra�ive costs for registering and processing the
vacant building owner registration form and-for the costs of the aity in monitorirag
the vacant building site. . . , - . -
�(2) The first annual fee shall be paid no later .than thirty (30) days after the
building becomes vacant. If the fee is not paid within thirty (3Q) days of being
2of3
04/30/97 13.33:53�
� � � � � � � � ��,��`1
, Bibliography
Fd Goetz. T'�e Fiscal Impacts of the St. Paul HOUSES TO HOMES Program. Center for Urban
and Regional Affairs. February 1997.
Sheryl Pemberton-Hoiby. Capital City Homes - Homeownership Development Oppornuuties
proposal. PED 199811999 LTnified Capitai Improvement Program and Budget Process.
St. Paul Legislative Code. Tnteme�
Endnotes
1. Edward Goetz. The Fiscal Impacts of the St. Paul HOUSES TO HOMES Pzogram. Center for
- Urban and Regional Affairs. February 1991:
2. Edward Csoetz. p 32
GT7-3�{g ✓
West 7thlFort Road Federattoa
974 Wast 7th Street
Saint Paul, Minnesota bb 102
(612)298-5b99
Apri130, 1997
Councilmembers Biakey and Harris
City of Saint Paul
Kellogg and Wabasha
Saint Paul, Minnesota 55102
Re: Capitol City Development Prograzn
Deaz Councilmembers,
In general, we support the proposed CCDP goals contained in the background section of the
pro�razn proposal. For your consideration, here aze some additional suggestions to strengthen the
program.
The University of Minnesota/CURA evaluation of the Houses to Homes program, utilizing a
typical reat estate appraisal formula, states that conservatively, investrnent has a 10 block ripple
effect. In lieu of this industry standazd and in light of the proposed guidelines, we wouid submit
the following guidelines for acquisition of vacant housing and redevelopment activities for your
consideration. Structures eligible under this program include any of the following:
i. Within 4 blocks of existing HOHO developments currently carrying deferred second
mortgages due and payable to the City of Saint Paul. The rntionale is that constant
diligence is required to protect past public and private investment and to stem
disinvestment trends in certaiu neighborhoods tequires long term attention.
2. Within 4 blocks of housing, commercSal or STAR projects currently cazrying fmancial
participation with the City of Saint Paui.
3. Within 1 block of a HLTD foreciosed home or tax forfeit pazcel occurring in the past two
yeazs.
4. Development funds would be auailabie to the Federation to purchase homes from seniors
who move into the Holm and Olson senior rentai housing development. The rationale is
that the goal of the Hoim and Olson development is to fmd life cycle suitable housing for
senioxs in the community, maintain current homeownership levels in the community, and
support redevelopment of a community througti better utilization of land and increased
tax base.
5. CCDP funds would be availabie to address problem properties which have a current case
history with departments of the City of Saint Paui.
Cooperatu'�gFund Drive Member
Affirmative ActiorYEqval Opportunity Employer
�� 3`(9
We support a cost reduction analysis study �vhich �vould reduce current development
requirements that have little benefit to the project, i.e. fire sprinkler requirement.
Given the goal of creating economically inie,,urated neiahborhoods. CCDP funds should provide
tlesibility in meeting this need for developers utilizing this proerani.
We strongly support the concept of poolin� the subsidy levels for a batch of homes jointly be
developed. This will gice developers more flexibility in responding to the general conditions of
the property. We do not think the proposed subsidy levels are workable at the $20,000 and
$25,000 level and do not understand the distincrion between the current high subsidy level for
new construction and this (evel for rehabilitated stcuctures.
We would suggest that PED provide historicat information regazding construction building
material costs since the inception of the program.
S � ly ►�+�^"
Richazd Miller, President
c: City Council President Thune
Council File # �R - 3 _4 9
Green Sheet # a�St
RESOLUTION
OF,$AIf�T PAUL, M�JVNESqTA
Presented
Referred To 1 __ _ _ _ _ , _ _ _ J O/ Committee Date
,ai,
WHEREAS, the Saint Paul City Council has engaged in numerous recent discussions regazding vacant housing and
neighborhood economic development strategies
WIiEREAS, the City Council recently adopted the City's Housing Business Plan, which calls for neighborhood based housing
developmet strategies and coordination of housing development with other private and public investment; and
WIIEREA5, the City Council recently discussed the CiJRA vacant housing study, which illustrated the importance of
rehabilitation of vacant housing; and
WI�REAS, the City Council is committedto rehabi]itatingvacanthouses andbuilding infill housing ]n acost efficientmanner;
and
WFTEREAS, the City Councii is committed to coordinating vacant housing rehabilitation and infill housing conshuction with
neighborhood economic development; now, therefore, be it
RESOLVED, that the Saint Paul City Council adopt the Capital City Development Progam; and be it
FURTf�R RESOLVED, that the City Council request the admuiistration to direct staff to implement the provisions of the
Capital City Development Program by 7une 1, 1997; and be it
FINALLY 12ESOLVED, that the City Council request that staff immediately convene a Cost Reducrion Analysis Focus Crroup
and that this focus group report to the City Council within six months after adoption of the plan.
Requested b epaztment of:
�
Adopted by Councfl: Date \\ � ° �9
Adoption Certified by Council Se retary
BY� � , �--�� c) - � �!-�. ..�-�-.—�
�
Approved by Mayor: Date _ _ _ _ _ _ _ _ _
Form Approved by City Attomey
�
Approved by Mayor for Submission to Council
�
�
' • - � ,� ` � ,
�
9�-3w9
�EPART�ENT/OFFICFJCOUNqL DATE INRIATED GREEN SHEET N_ 2 2 8 8 8
ci . conncil 4/2l97
iNRIAV�ATE INITIAUDATE
CONTACT PERSON 6 PHONE - . � � DEPARTAtENi OIRE � CT' WUNCIL
C011IlC]�I1CffibEIS �iLITIS�f21CC� ' N �UMB 'a EA FOR � GITYATTORNEY � CRYCIERK
MUST BE ON COUNCIL AGENDA BY (DA'S� pp�N� � eUDGET DIRECTOR Q FW. b MGT. SFAVICES DIR.
� G G ! '(� S a��� � MAVOR (OR ASSISTAM) � �
� . OC t +-�
TOTAL # OF SIGNATUH£ PAGES � (CUP ALL LOCATIONS FOR SIGNATURE) -
ACT70N HE�UESTED:
Creating Capitai City Development Program.
AECOMMENDA7roNS: Approva (A) or Aejea tR) pEHSONAL SERVICE CONTRACTS MUST ANSWER TNE FOLLOWING QUESTIONS:
_ PIANNIN6 COMMISSION _ CNIL SEFNICE COMMISSION �� Has thi5 per5ontlkm eY¢f Worketl unde[ d conttact far thi5 departmant?
_ C�B COMMfrzEe _ YES NO
2. Has Nis person�rtn ever been a ciry employee?
—'� — YES NO
_ D55a�C7 COUai _ 3. Does this peBOn/firm possess a skilf not normaily possessed by any curtent city emplayae?
SUPPORTS WHICN CqUNCIL 0&IECTIVE? YES NO
Explain all yes answera on seperete sheet end ettneh to graen sheet
INITIATiNG PROBLEM, ISSUE, OPPOflTUNITV (WM1O, Whar, WhBn, Where, Why).
ADVANTACaESIPAPPROVEO:
DISADVANiAGESIFAPPRWED: �
DISADVANTAGES IF NOT APPROVED:
TOTAL AMOUN7 OF ipANSACT10N $ COST/REVENUE BUDGETED (CIRCLE ONE) YES NO
FUNOlNG SOURCE ACTIVI7V NUMBER
FlNANCIAL INFORMATION: (EXPLAIN)
q� •�y9
Capital City Development Program
Background
Discussion of costs associated with new infill housing and housing rehabilitation has been
ongoing for neazly a year. The discussion was prompted by the City CounciPs review o£ a
waiver of Aouses to Homes guidelines for increased subsidies on several developments.
Councilmembers have been concerned about the effactiveness of the program, the level of
subsidy, the impact on the neighborhaod and the impact on the City tas base. Pursuant to these
discussions, the City Council acting as the IiRA decided to lower the subsidy for the Houses to
Homes program. Subsidy limits had been set at $40,000 per single family and $60,000 for
duplex homes but were reduced to $20,OOQ and $25,OOQ respectively.
Subsequent City Council discussion in the first three months of 1997 of the City's Housing
Business Plan and the CURA report generated the impetus for the Capitol City Development
Pian. The Capital City Development Program (CCDP) is a proposai in response to policy
discussion generated at the Saint Paul City Council related to housing rehabilitation and
commercial development. CCDP desires to:
• target development geographically to coincide with other development and invesiment;
• decrease bureaucratic and administrative costs through larger scale development
contracts;
• decrease construction costs by el'uninating onerous buiiding requixements in an effort to
make public resources stretch further; and
• improve the flexibility of public funds by continuing to collapse program resources into
fle�ble funds available to neighborhood housing and development organizations..
This proposal xepresents a starting point for fiu�ther discourse based on the suggesfions of
Councilmembers, City staff and the community.
The Current Environment
There are nine community development corporations operating in the City of Saint Paul that
have used the Houses to Homes program dollars to rehabilitate vacant housing Citywide. Due to
a number of factors, including availability of vacant homes, the process by which the City
condemns a building, availabiliry of funds, high aquisition costs of H[JD homes, and high
tumover of H[JD homes, targeted development of specific block azeas has been probiematic.
Typically the geographic area encompasses the border of the azea served and is used as the
reference point for targeted areas.
°►� - 3y°►
Coxnrmunity development corporations also serve the business community and aze a focal point
through which businesses gain access to monies and introductian to the City resources. These
aze the neighborhood connecrions through which the City moves some grant and low interest
money to neighborhood businesses.
There are also other agencies that provide housing rehabilitation services to the community such
as Rondo Community Land Trust, Habitat for Humanity and Project for Pride in Living to name
a few that are important to creating a stronger capital city.
Private developers also play an important role in the development of housing, commercial
property and attracting new ancUor expanding businesses to the City of Saint Paul. The Port
Authority and PED are accessible to these private developers. It appears that some brownfield
money may be available along with Tax Increment Financing (TIF) to continue the development
of underutilized commercial property in Saint Paul.
Business associations throughout Saint Pau1 have played a key role in atkracfing new businesses
to emerging commercial areas. They are a unique vehicle to get funds to businesses and also
serve as conduits for City resource information to businesses.
Capital CitY Develo�ment Program Scope and Fundi�
The Capital Ciry Development Program wiil realign City development objectives with
neighborhood-based proposals for housing and business revitalization. The program will target
specific residential and commercial areas and require strategies for rehabilitation of vacant
homes, housing rehabilitation, rental rehabilitation, and commercial development.
The CCDP would be comprised of two funds; Capital City Homes and Capital City Business
Development. Capital City Homes funds would be available for new infill housing, vacant
building rehabilitation, and rehabiltiation of homes. Customers could include community
development corporarions and private nonprofit and for-profit developers.
The following funding sources should be examined for inclusion into the Capital City Homes
fixnd. If inciuded, 60% of these funds would be dedicated to Capital City Homes and 40% would
remain far citywide use:
• Scattered site Tax Increment Financing for blighted and vacant land
• The Houses to Homes Progratn
• Home Loan fund - Deferred Loan Program
• HOME
For those development contracts that participate in Capitai City Homes and utilize the Houses to
Homes Program, the $20,000 and $25,000 subsidy limits would no longer be applied to each
individual house, Instead, the entire proposal would be limited to a total gap subsidy equal to the
q�t-�49
sum of the maximums available for each home within the proposal. This subsidy could be spent
at the developez's discretion. In other words, if a development contract called for six vacaut
single family homes and two vacant duplexes to be rehabilitated, the totai amount of Houses to
Homes dollars available would be $170,000 (6 x$20,000 plus 2 x$25,000). Under Capital City
Homes, this $170,000 total could be divided among houses within the development contract in
any fashion.
Capital City Business Development funds would be available for commercial rehaMlitation and
business development. Customers could include community development corporations, business
associations, and private nonprofit and for profit developers.
The following funding sources should be ex�mnied for inclusion into the Capital City Business
Aevelopment fund. If included, 50% of these funds would be dedicated for Capital City
Business Development and 50°!o would remain for citywide use:
Commercial Rental Rehabilitation
Commercial Development
Enterprise Leverage Fund
Criteria for Develo�ment Pro_posals
To avoid an influY of proposals that request waivers to deviate significantly from program
guidelines, it is neccessary to outline specific criteria. SpecifiCity will also help guide
developers, who will be operating under a different process than in the past. To meet the stated
objectives of the CCDP, the criteria for successfiai development proposals should include the
following:
a development area with the presence of other private or pubiic investments such as
residential street paving, community center construction, school improvements, or
investment in a local commerical center;
demonstrated adtninistrative or conshuction cost savings within the proposal due to
targeted geographicai impact or economies of scale;
a statement of eligibility for the development area with respect to the following eligibility
requirements:
1) proximity to a number of vacant homes
2) proxunity to blighted land or property
3) a stated decline in properiy valuations within the development azea
4) a stated decline in the rate of owner-occupied housing; and
proposals that include use of both Capital City Homes Funds and Capital City Business
Development funds will be eligible for funding from both sources.
�►�-�y°�
Department of Planning and Economic Development
The Capital City Development program is an assimilation of current programs auailable to the
community. PED should continue to collapse and integrate programs to allow for more
fle�bility to addzess housing and commercial development concerns. If federal waivers are
needed to reduce requirements the City should contact the appropriate federal agencies. In those
instances where federal guidelines aze in place, a cleaz staxement of those guidelines and
tecluucal assistance should be made available to the neighborhood organizafion along with the
grant. All efforts should be made to use the most restrictive funding sources in areas that are
eligible for those sources, so that less restrictive funding sources can be used in other areas.
PED would issue funds in the form of block grants to the community organizations who sign a
contract with the City to expend those funds as indicated in their proposal. The community
organization(s) would be responsible far the use of the funds and would be available for an audit
of the program.
Cost Reduction Analysis
In addirion, a focus group of developers, housing specialists and business owners will be brought
together to address issues that drive cost of rehabilitation or development but have little or no
significant impact on the project. These issues might include sewer and water access, permit
costs, onerous construction requirements or other soft costs. For example, a sprinkier
requirement for new homes drives the cost of housing up from $3,000 to $5,000 per house, this
requirement only occurs in Saint Paul and hampers our ability to compete with surrounding
municipalities. A suggested change may be to modify the requirement to having smoke detectors
hardwired. Important topics for this focus group may also include:
construction costs
administrative costs
bureaucratic costs
PED will develop the focus groups and report back to the City Council on the cost saving ideas
generated by the group within six months of adoption of the program.
Action Plan
To facilitate discussion on these issues among City Council Members, City staff, and members
of the community, a series of resolutions pertaining to components of the Capitai City
Development Program will be introduced in the near future.
C��-�`��
R.ATI�NALE Ft3R CIB REVIEW OF CAPITAL CITY
DEVEL4PMENT "CONTRACTS"
1. "Sunshine" provision - Bring development "contracts" under
the same legislative cade provisions that govern
budget requests,
role of CIB.
part of the existing priar review
other capita.l
and comment
Unless there is an opportunity for such a review prior to a City Council hearing, the proposaLs
will be entirely products of staff negotiation, with no outside review or even guarantee of broader
neighborhood consensus. CIB or oiher level of prior review would aid ihe neighborhood and the
Councit by serving as a"sounding board" mdependent of staff review. (As is done now with
CIB/CDBG budget, and was done by a committee of the PLwning Commission with NPPs.)
2. Coordination with other budget processes.
Not only is there a need to look ai this progrem withm the broader coniext of total pnblic
investinent in an area (from sow�ces outside this program}, but there is need over time, to look at
ihe balauce of programming across all available fimd'utg sources (withm ttee program). This is
particularly important in that the Capitai City Development Fund is not intending to use a"eycle"
(application deadline) but to allocate and presumably modify prograws on a contract basis.
3. Geographical and program balance
�
An outside review process wouitl provide oveisig�t on the ovetall distriibution of resources
among neighborhoods and 1yQes of progeam approaches. Such a review would aLso look at
issues of comgarability of approaches across PED "quadrauts," and relationsirips with
neighborhood organizations.
r^ � _ , L'� \
_�
PROFILE OF PR03ECT / PROGRAM REVIEW
EXAMPLE 1- SINGLfi PR03ECT, LTNIFIED CIB PROCESS
PRO7ECT: DAYTON'S BLiJFF RECREATION CENTER
DESCRIPTiOId: New buildiug and playground improvements
F[7NDING:
REVIEW PROCESS: Neighborhuod > CIB Community Facilities Task Force > CIB
Committee > Mayor > City Council
FOLLOW-UP: t7nce project is fvnded, departrnent proceeds. CIB would s�view any
major budget changes or fumre reqaests.
EXAMPLE 2- CI$ PROGRAM ALLOCATION, STAFF-ONLY SELECTION
OF PROJECT SITES
PROJECT: VACANT AND HAZARBOUS BUII.DING REMOVAL
DESCRIPTTON: Citywide fimd to demolish suuctures on a quick-decision needs basis.
FUNITING: 1946 -$1,000,000 CDBG. 1497 -$1,000,000 CDBG
REVIEW PROCESS: YED > CIB Residential and Economic Development Task Force > CIB
Committee > Mayor > City Council
FOLLOW-UP: CIB review only as budget line item, put of next fundiug cycle.
BXAMPLE 3- PROGRAM ALLOCATION, FI1TiJRE PROJECT REVIEW
PRO7ECT: CAPITAL MAI':�T'£E23ANCE PROGRAh4
DESCRIPTTON: Fund for r� of City buildings, facilities.
FCTNDING: 1996 -$1,40p,QaJ CIB. 1997 -$1,000,000 Cffi
REVIEW PROCESS: Budget Office > CIB Committee > Mayor > City Council
FOLLOW-UP: After allocation uf "fund" as a budget lme item, departmenLs submit
spec�c project requests > CIB/Staff sub-committee > CIB Committee
> Mayor > City Council (as a consent agenda item)
EXAMPLE 4-(NEV►� "INTERMEDIARY" PROGRAM FUNll, CONTRACTS
PROJECT: CAPTTAL CITY DEVEIAPMENT FiJND
DESCRIPTION: Combined-sowce neiglil>orhood redevelopment
FUNDINC: ??? CDBC + HOME + HRA, + Other
REV�W PROCESS: (for CDBrs program allocation) PED > CIB Residential and Economic
Development Task Force > CIB Comauttee > Mayor > City Council.
For other - ???
FOLIAW-UP: 13o review proposed for conuacts to CDCs, others. ConUracis are for more
than smgle site selection. CIB moniYOr of CDBG fimd balance.
�
�(�,�`-lq
,
�
Rondo Community Land Trust
To: Counciimember Jerry Blakey
Counciimember Mike Hatris
From: Kris Nelson, President �'
Rondo Community Land Trust
Date: Apri130, 1997
Re: Vacant Housing and the Capital Citp Bevelopment Program
We appreciate the opportunity to comment on the Gapital City Development PrQgrasn at taday's
policy meeting. Enclosed 'is a draft in which we focus on the vacant and boarded building
procedure, the current rehabilitation snbsidy levels, as well as t}ie Capital Eity Develogment
Pragram., � � �.
� In parCiculaz, �ve urge that.subsidy Tey"els far rehabilitatioa be�sert at $40,6D0 for single fanlily �` �
homes in order for these su6sidies to be used most effectively. VJithin the Jast few years, Rondn
CLT moved �ve honses ta vacant lots wiChin the;Suinmit-University / Lexington-Hamline
neighborhoods-and rehabilitate,d tkie strgctures. Each home required more tl�an $20,060 in� '�- �
subsidp and would have been demolished without the,availability of kigher subsidies. The
house§ now generate t�es for the city and benefits fot the neighborhood.
We would,like to continue contributiugxo the policy drscussion surrounding the Gapital City��� - �� �
DevelopmentProgram. Please coniact us if you have qnestions or require additional inforniation
�; regarding this draft. �Thank you. � � _ � _ � � � �
1183 Ashland Avenue St Pau1, MN 55414 (612) 64Z-0862
� l ��� !
Objecfive
The following summary exaxuuies St. Paul's procedure for_vacant and boazded buildings,
addresses the subsidy levels for rehabzlitation as set by the Houses to Homes program, and
reviews elements of the Capital City Development Program. Conclusions aze as follows:
1. Rehabilitation and reoccupation of vacant houses must become a city priority.
2. Subsidies must be set at a leveI that enables quality rehabilitation to occur:
3. In the creation of mini-block grants, STEiR funds must be included to ailow for resource
flexibility, and other issues should be addressed.
Vacant Buildings -
According to the recent Houses to Homes study conducted by Edward Goetz, there is an average
of 475 vacant houses on the Public Health Vacant Building list at any time. These vacant
houses tend to concentrate within St. Paul's lower-income neighborhoods where negati�Fe;impacts
such as the depression of surrounding property, values and erosion of the properiy taY base are
heightened. Vacattt houses are potential assets and resources for the city of St: Paul. Benefits .
from investments in rahabilitated housing spill over into the cotiununitythrough an mipxoved tax
base and a stabilizaxion in. surroundingneighborhoods. The costs associated with demolition .
negate these benefits, ye{ the current nuisanee policy adininistered by the city of St, Paul
aggressively pnshes vacant houses to demolition. _ The:-rate of demolifion outpaces new
construction witlra widening,gap. It is our premise that the yacant houses within tke city are
resources to be preserved, and we ask the ciry of St. Paul to strongly promote rehabilitation and
� reoccupation as st eitypriortty. Demolition must be the i�st x"esort, not the goal. --
The St. Paul Legislative'Code outli�es the procedu�e for abatemerit of a nuisance properiy; .
however, it does not outline a clear process for involving, outside patties who may be interested
in zehaliilitating a property s�iould the owner not wish to do, so. Structurally, sound houses have .,,
beemdemoIisked in part beoause outside parties were not able to intervene early enough to sava .
the bnildings. We recommend that at th� time a vacant building is Legistered; City Council,
� neighborhood Community Development Corpoiations; other kousing'organizations, ths District .
� Counc�l and�city depaztrnentssuc�k as PED ar� no�ifiecT as well the owner. At this stage, ajoint ��:
meating.should be held between the.owner of record, Public Health an& the notified pacties to
deternane ne� steps and.#o create a plan for nse and/or demolifiion. The foundatian for-this
process is put foi in. the St. Paul Legislative Code; Section 43.03, number 4, which states, "The
period of tima tlie building is expected to remain vacant; and a ptan and timetabte for retttrning
the building to appropriate occupancy ar use andJor for demolition of the building". The goal is
to work witti oumers of vacant buildings in order to make an early determination of the status of
tkte vacant structure.
Subsidies
The original Houses to Horrzes program included the following objectives: `to save existing'
housing stoek, wfiere feasible; to recapture and improve the City's tax base; to inerease
hdmeownership-opportunities; to contribute to the revita�f�ationand stabilization of "" ,
a �,���
neighborhoods; and to address vacant buildings tt�rough better coordination and City focus
througJ� code enforcement, rehabilitation and demolition. Houses to Homes subsidies were
established at a level that would allow the creation of lugh quality housing to attract middle
income people to the city and to preserve historic structures. Subsidy levels were set at $40,OQ0
for rehabilitation for single-family vacant houses.and $60;000 for rehabilitation and conversion
of multi-family units to single units.
As concluded in the Houses to Homes study, subsidies for rehabilitation do zesult in a net cast for
the city; however, rehabilitation provides benefits tiiat average one-half of the original subsidy
(net cost: $21,866). Demolifion is associated with lower upfront costs (appro�mately $9,000),
and lower properiy valuesfor surrounding areas. "Although subsidy appeazs fo be a much more
costly alternafive upfront ($40,000 subsidy compared to no subsidy for demolition), affer a
systematic review of costs and benefits, the difference between the two strategies is closer to
$12,000" ($21-9}. Adequate funding can help insure that vacant buildings are reoccupied. It
must be deternvned whether the benefits derived through rehabilitation are woxth the additional
expenditure and whether cunettt subsidy levels enable the development of quality housing that
best serves the needs of the ciry and its.residents.
We propose that the Houses to FIo»aes program * increase subsadie"s to the leveds originally ",
established by the Ciry Council ($40,000 and $65,0(JO).
•Honses m Homes may be incorporated into CapiYal City Homes.
Cagital City Development Pragrafn (CCDP), . -
"As stated in PEJ7's Capital Improvement Program.and Budget Process (GiB) PrQposal, flexible
- fmancing is needed to"assist variaus gzoups and individuals -in nndertakiug an assortment af .
hoine oreafion or improvemeut projects. Streamlining the funding procedure by collapsing
various programs and funds under one umbrella and disbursing mini-block grants, therefore, wili,- "
,� be benaficiaL STAIZ funrLs�shoulc�be included ivithin the urizbrelta, as the,se funds are the inost .. �
unresiricted resources available. Althougfi tfie STAR furids are most fleatible, the current"
application guidelines are cumbersome and this has, in effect, reduced the number of applicants'
to.the prograzn. The STAR eriteria ahould be reviewed to-determine ways in which flie fnnds can
be more readily accessed., � � , ,� � � � � � �
One goal of the CCDP_is to °decrease construction costs by eliminafing onerous btulding
requirements, in an effort to make public resources stretch further". Legislative meetings have
been held to address city requirements tfiat add unnecessazy cost; however, State Uniform
Building Codes supersede, City building code requirements. . We suggest, therefoxe, that St. Paul
and othermunicipalities crekte a separate taskforce to make recommenclations on possible State "
code changes.
Finally, each development project is unique. While predeternuned criteria are helpful in defining
city parameters, these criteria must be fle�ble iri allowing neighborhoods to define what
constitutes a priority. Also there must be adequate PED hausing staff to assist the neighborhoods
with development proposals. � � �
�'�'���
Recommendations
Tjacant Building Procedure
* Rehabilitation and Reoccupation of vacant houses should be a city priority, with demolition as
a last resort. �
*Create a notification procedure at the front end of the vacant building process. City Council,
neighborhood Distr'tct Councils, Community Development Corporations, land irusts and other
groups-shouid be notified during the vacant building registration process. A meeting should be
held between these groups and the owner to make an eariy determinatian of a.feasibie plan for
reoccupafion, rehabilitation or demolition..
*If rehabilitation or reoccupafion is not feasible, salvaging the building materials should be a
priority.
Subsidy Zevels -
*As under the Houses to Homes program, subsidies for rehabilitation should return to their ..
original� levels: � �
$40,000 for a single familyhouse and $6Q,OOQ for.conversion of multi-family units to a singie-
family unit. � � � � . _ � �
*For historic houses, a.separate fund shoutd be administered for those,projects exceeding the ,-,
subsidy limits of $40,000 and $6fl,0�0.
� CCDP. � , ° � � � � � � _
�� *IncIude STAR fdnds°in.t,he Capital City Homes grogram.. Reexamine STAR criteria in ozdai"to
�- � � m�ke this resource more xeadilg auailable for use. � � � � �
` *Because State Uniform Building,Codes supersede City codes, St. Paul and otfier municipalities _
', should form a task force to review wluch state codes oouid be. changed to make them more cost
, effecfive.
*Ensure that there is adequate PED staff to assist neighborhoods with development proposals.
Also PED and neighborhoods should use the same type of softwaze package for development
projects.
httpJ/freedom.stpaul.g.../legislative/Ic043.htm1
f. Condemned and illegally occupied; or
http://freedomstpaul.govlstpauUlegislariveQc043.htmi
c�� _7`�`1
g. Unoccupied for a periDd o£_time over three hundred sixty-five (365) days and
during which time the enforcement officer has issued an order to correct nuisance
conditions_
i0rd. No. 17862, I�section]7 1, 8-13-91) _ -
Sec. 43.03. Vacaat building�registration.
(a) The awnes shall register with the enforcement o£ficer not later than thirty (30)
days after any building zn trie city becomes a vacant building, as de£ined in section
43.02 (7) . .. - � .
(b) Trie registration sha11 be submitted on forms provided by the eaforcement officer
and shall include the following infoxmation supplied by the owner: �
il) A description of the premises;
(2) The names and addresses of the owner or owners;
(3) The names and addresses o£ all known lienholders and all other parties with an
ownership interest in the buildiiig; .
�--�(-4) The pesiod of time the building is expected ta remain vacant; and a-plan and
time'table for returning the building to appropriate occupancy or use.andfor for
demolition of the.building.
(5) A copy of any current Truth-in-Sale of Housing Disclosure Report as required by
Saint Paul� Le�islative Cod'e Chapter 189., � � � " � - " _ , " - � - , - . ,
(c) The ow�er,.shall submit a plan and,timetable which must meet trie approval of the
enforcement officer. The enforcement'officer shall xequire completion oE tfie plan
within a reasonable perj.od of time, up to three hundred sixty-five (365) days.,.The
plan subrr[itted ehall ;comply with the provision of Chapter_33 of the Sairit Paul -
I,egislative Code. Any repairs, improvements or alterations to the must
comply with any applicable housing or building codes.
{d) All applicable laws and codes sha11' be comglied_with.by the owner. The owner-
shall notify the enforcement officer of any changes in information supplied as part
of the vacant building registration within thirty (30) days of th'e change., Zf the
plan or timetable £or Ehe vacant building is revised in any way, the revis3ons must
meet the approval,of the'enforcement officer. -
`: (e) The owner and the subsequent owners sHa31 keep the building,secured and safe and
the bui2ding and ground properly maintained until the rehabiTitation or demolition
has been completed.
'(f� Fail'ure of the owner or any subsequexit owp.Ar to maintain the and� _
premises that resul£ in a summary abatement completed by.the city,shall be gronnds
for revocation of the approved�_plan and,shall be subject'to any applicable,penalties
provided by law.
(g) The new.owner(s) shall�register or re�-register the vacant�bu3lding with the �
enforcement officer within thirty (30)�days of any transfer of azi ownership interest-
in a vacant building. The new owner(s) shall comply with the approved plan and
timeCable svbmitted by the previous owner until any proposed changes are submitted
and meet the approval of the enforcement officer.
th) Vacant building £ees:'
(1) The owner of a vacant building shall pay an annual�fee�of�two hundred dollars.
($200:00) for the period the building��remains a vacant building. The fee shaZl be
reasonably related to the administra�ive costs for registering and processing the
vacant building owner registration form and-for the costs of the aity in monitorirag
the vacant building site. . . , - . -
�(2) The first annual fee shall be paid no later .than thirty (30) days after the
building becomes vacant. If the fee is not paid within thirty (3Q) days of being
2of3
04/30/97 13.33:53�
� � � � � � � � ��,��`1
, Bibliography
Fd Goetz. T'�e Fiscal Impacts of the St. Paul HOUSES TO HOMES Program. Center for Urban
and Regional Affairs. February 1997.
Sheryl Pemberton-Hoiby. Capital City Homes - Homeownership Development Oppornuuties
proposal. PED 199811999 LTnified Capitai Improvement Program and Budget Process.
St. Paul Legislative Code. Tnteme�
Endnotes
1. Edward Goetz. The Fiscal Impacts of the St. Paul HOUSES TO HOMES Pzogram. Center for
- Urban and Regional Affairs. February 1991:
2. Edward Csoetz. p 32
GT7-3�{g ✓
West 7thlFort Road Federattoa
974 Wast 7th Street
Saint Paul, Minnesota bb 102
(612)298-5b99
Apri130, 1997
Councilmembers Biakey and Harris
City of Saint Paul
Kellogg and Wabasha
Saint Paul, Minnesota 55102
Re: Capitol City Development Prograzn
Deaz Councilmembers,
In general, we support the proposed CCDP goals contained in the background section of the
pro�razn proposal. For your consideration, here aze some additional suggestions to strengthen the
program.
The University of Minnesota/CURA evaluation of the Houses to Homes program, utilizing a
typical reat estate appraisal formula, states that conservatively, investrnent has a 10 block ripple
effect. In lieu of this industry standazd and in light of the proposed guidelines, we wouid submit
the following guidelines for acquisition of vacant housing and redevelopment activities for your
consideration. Structures eligible under this program include any of the following:
i. Within 4 blocks of existing HOHO developments currently carrying deferred second
mortgages due and payable to the City of Saint Paul. The rntionale is that constant
diligence is required to protect past public and private investment and to stem
disinvestment trends in certaiu neighborhoods tequires long term attention.
2. Within 4 blocks of housing, commercSal or STAR projects currently cazrying fmancial
participation with the City of Saint Paui.
3. Within 1 block of a HLTD foreciosed home or tax forfeit pazcel occurring in the past two
yeazs.
4. Development funds would be auailabie to the Federation to purchase homes from seniors
who move into the Holm and Olson senior rentai housing development. The rationale is
that the goal of the Hoim and Olson development is to fmd life cycle suitable housing for
senioxs in the community, maintain current homeownership levels in the community, and
support redevelopment of a community througti better utilization of land and increased
tax base.
5. CCDP funds would be availabie to address problem properties which have a current case
history with departments of the City of Saint Paui.
Cooperatu'�gFund Drive Member
Affirmative ActiorYEqval Opportunity Employer
�� 3`(9
We support a cost reduction analysis study �vhich �vould reduce current development
requirements that have little benefit to the project, i.e. fire sprinkler requirement.
Given the goal of creating economically inie,,urated neiahborhoods. CCDP funds should provide
tlesibility in meeting this need for developers utilizing this proerani.
We strongly support the concept of poolin� the subsidy levels for a batch of homes jointly be
developed. This will gice developers more flexibility in responding to the general conditions of
the property. We do not think the proposed subsidy levels are workable at the $20,000 and
$25,000 level and do not understand the distincrion between the current high subsidy level for
new construction and this (evel for rehabilitated stcuctures.
We would suggest that PED provide historicat information regazding construction building
material costs since the inception of the program.
S � ly ►�+�^"
Richazd Miller, President
c: City Council President Thune
Council File # �R - 3 _4 9
Green Sheet # a�St
RESOLUTION
OF,$AIf�T PAUL, M�JVNESqTA
Presented
Referred To 1 __ _ _ _ _ , _ _ _ J O/ Committee Date
,ai,
WHEREAS, the Saint Paul City Council has engaged in numerous recent discussions regazding vacant housing and
neighborhood economic development strategies
WIiEREAS, the City Council recently adopted the City's Housing Business Plan, which calls for neighborhood based housing
developmet strategies and coordination of housing development with other private and public investment; and
WIIEREA5, the City Council recently discussed the CiJRA vacant housing study, which illustrated the importance of
rehabilitation of vacant housing; and
WI�REAS, the City Council is committedto rehabi]itatingvacanthouses andbuilding infill housing ]n acost efficientmanner;
and
WFTEREAS, the City Councii is committed to coordinating vacant housing rehabilitation and infill housing conshuction with
neighborhood economic development; now, therefore, be it
RESOLVED, that the Saint Paul City Council adopt the Capital City Development Progam; and be it
FURTf�R RESOLVED, that the City Council request the admuiistration to direct staff to implement the provisions of the
Capital City Development Program by 7une 1, 1997; and be it
FINALLY 12ESOLVED, that the City Council request that staff immediately convene a Cost Reducrion Analysis Focus Crroup
and that this focus group report to the City Council within six months after adoption of the plan.
Requested b epaztment of:
�
Adopted by Councfl: Date \\ � ° �9
Adoption Certified by Council Se retary
BY� � , �--�� c) - � �!-�. ..�-�-.—�
�
Approved by Mayor: Date _ _ _ _ _ _ _ _ _
Form Approved by City Attomey
�
Approved by Mayor for Submission to Council
�
�
' • - � ,� ` � ,
�
9�-3w9
�EPART�ENT/OFFICFJCOUNqL DATE INRIATED GREEN SHEET N_ 2 2 8 8 8
ci . conncil 4/2l97
iNRIAV�ATE INITIAUDATE
CONTACT PERSON 6 PHONE - . � � DEPARTAtENi OIRE � CT' WUNCIL
C011IlC]�I1CffibEIS �iLITIS�f21CC� ' N �UMB 'a EA FOR � GITYATTORNEY � CRYCIERK
MUST BE ON COUNCIL AGENDA BY (DA'S� pp�N� � eUDGET DIRECTOR Q FW. b MGT. SFAVICES DIR.
� G G ! '(� S a��� � MAVOR (OR ASSISTAM) � �
� . OC t +-�
TOTAL # OF SIGNATUH£ PAGES � (CUP ALL LOCATIONS FOR SIGNATURE) -
ACT70N HE�UESTED:
Creating Capitai City Development Program.
AECOMMENDA7roNS: Approva (A) or Aejea tR) pEHSONAL SERVICE CONTRACTS MUST ANSWER TNE FOLLOWING QUESTIONS:
_ PIANNIN6 COMMISSION _ CNIL SEFNICE COMMISSION �� Has thi5 per5ontlkm eY¢f Worketl unde[ d conttact far thi5 departmant?
_ C�B COMMfrzEe _ YES NO
2. Has Nis person�rtn ever been a ciry employee?
—'� — YES NO
_ D55a�C7 COUai _ 3. Does this peBOn/firm possess a skilf not normaily possessed by any curtent city emplayae?
SUPPORTS WHICN CqUNCIL 0&IECTIVE? YES NO
Explain all yes answera on seperete sheet end ettneh to graen sheet
INITIATiNG PROBLEM, ISSUE, OPPOflTUNITV (WM1O, Whar, WhBn, Where, Why).
ADVANTACaESIPAPPROVEO:
DISADVANiAGESIFAPPRWED: �
DISADVANTAGES IF NOT APPROVED:
TOTAL AMOUN7 OF ipANSACT10N $ COST/REVENUE BUDGETED (CIRCLE ONE) YES NO
FUNOlNG SOURCE ACTIVI7V NUMBER
FlNANCIAL INFORMATION: (EXPLAIN)
°►� - 3y°►
Coxnrmunity development corporations also serve the business community and aze a focal point
through which businesses gain access to monies and introductian to the City resources. These
aze the neighborhood connecrions through which the City moves some grant and low interest
money to neighborhood businesses.
There are also other agencies that provide housing rehabilitation services to the community such
as Rondo Community Land Trust, Habitat for Humanity and Project for Pride in Living to name
a few that are important to creating a stronger capital city.
Private developers also play an important role in the development of housing, commercial
property and attracting new ancUor expanding businesses to the City of Saint Paul. The Port
Authority and PED are accessible to these private developers. It appears that some brownfield
money may be available along with Tax Increment Financing (TIF) to continue the development
of underutilized commercial property in Saint Paul.
Business associations throughout Saint Pau1 have played a key role in atkracfing new businesses
to emerging commercial areas. They are a unique vehicle to get funds to businesses and also
serve as conduits for City resource information to businesses.
Capital CitY Develo�ment Program Scope and Fundi�
The Capital Ciry Development Program wiil realign City development objectives with
neighborhood-based proposals for housing and business revitalization. The program will target
specific residential and commercial areas and require strategies for rehabilitation of vacant
homes, housing rehabilitation, rental rehabilitation, and commercial development.
The CCDP would be comprised of two funds; Capital City Homes and Capital City Business
Development. Capital City Homes funds would be available for new infill housing, vacant
building rehabilitation, and rehabiltiation of homes. Customers could include community
development corporarions and private nonprofit and for-profit developers.
The following funding sources should be examined for inclusion into the Capital City Homes
fixnd. If inciuded, 60% of these funds would be dedicated to Capital City Homes and 40% would
remain far citywide use:
• Scattered site Tax Increment Financing for blighted and vacant land
• The Houses to Homes Progratn
• Home Loan fund - Deferred Loan Program
• HOME
For those development contracts that participate in Capitai City Homes and utilize the Houses to
Homes Program, the $20,000 and $25,000 subsidy limits would no longer be applied to each
individual house, Instead, the entire proposal would be limited to a total gap subsidy equal to the
q�t-�49
sum of the maximums available for each home within the proposal. This subsidy could be spent
at the developez's discretion. In other words, if a development contract called for six vacaut
single family homes and two vacant duplexes to be rehabilitated, the totai amount of Houses to
Homes dollars available would be $170,000 (6 x$20,000 plus 2 x$25,000). Under Capital City
Homes, this $170,000 total could be divided among houses within the development contract in
any fashion.
Capital City Business Development funds would be available for commercial rehaMlitation and
business development. Customers could include community development corporations, business
associations, and private nonprofit and for profit developers.
The following funding sources should be ex�mnied for inclusion into the Capital City Business
Aevelopment fund. If included, 50% of these funds would be dedicated for Capital City
Business Development and 50°!o would remain for citywide use:
Commercial Rental Rehabilitation
Commercial Development
Enterprise Leverage Fund
Criteria for Develo�ment Pro_posals
To avoid an influY of proposals that request waivers to deviate significantly from program
guidelines, it is neccessary to outline specific criteria. SpecifiCity will also help guide
developers, who will be operating under a different process than in the past. To meet the stated
objectives of the CCDP, the criteria for successfiai development proposals should include the
following:
a development area with the presence of other private or pubiic investments such as
residential street paving, community center construction, school improvements, or
investment in a local commerical center;
demonstrated adtninistrative or conshuction cost savings within the proposal due to
targeted geographicai impact or economies of scale;
a statement of eligibility for the development area with respect to the following eligibility
requirements:
1) proximity to a number of vacant homes
2) proxunity to blighted land or property
3) a stated decline in properiy valuations within the development azea
4) a stated decline in the rate of owner-occupied housing; and
proposals that include use of both Capital City Homes Funds and Capital City Business
Development funds will be eligible for funding from both sources.
�►�-�y°�
Department of Planning and Economic Development
The Capital City Development program is an assimilation of current programs auailable to the
community. PED should continue to collapse and integrate programs to allow for more
fle�bility to addzess housing and commercial development concerns. If federal waivers are
needed to reduce requirements the City should contact the appropriate federal agencies. In those
instances where federal guidelines aze in place, a cleaz staxement of those guidelines and
tecluucal assistance should be made available to the neighborhood organizafion along with the
grant. All efforts should be made to use the most restrictive funding sources in areas that are
eligible for those sources, so that less restrictive funding sources can be used in other areas.
PED would issue funds in the form of block grants to the community organizations who sign a
contract with the City to expend those funds as indicated in their proposal. The community
organization(s) would be responsible far the use of the funds and would be available for an audit
of the program.
Cost Reduction Analysis
In addirion, a focus group of developers, housing specialists and business owners will be brought
together to address issues that drive cost of rehabilitation or development but have little or no
significant impact on the project. These issues might include sewer and water access, permit
costs, onerous construction requirements or other soft costs. For example, a sprinkier
requirement for new homes drives the cost of housing up from $3,000 to $5,000 per house, this
requirement only occurs in Saint Paul and hampers our ability to compete with surrounding
municipalities. A suggested change may be to modify the requirement to having smoke detectors
hardwired. Important topics for this focus group may also include:
construction costs
administrative costs
bureaucratic costs
PED will develop the focus groups and report back to the City Council on the cost saving ideas
generated by the group within six months of adoption of the program.
Action Plan
To facilitate discussion on these issues among City Council Members, City staff, and members
of the community, a series of resolutions pertaining to components of the Capitai City
Development Program will be introduced in the near future.
C��-�`��
R.ATI�NALE Ft3R CIB REVIEW OF CAPITAL CITY
DEVEL4PMENT "CONTRACTS"
1. "Sunshine" provision - Bring development "contracts" under
the same legislative cade provisions that govern
budget requests,
role of CIB.
part of the existing priar review
other capita.l
and comment
Unless there is an opportunity for such a review prior to a City Council hearing, the proposaLs
will be entirely products of staff negotiation, with no outside review or even guarantee of broader
neighborhood consensus. CIB or oiher level of prior review would aid ihe neighborhood and the
Councit by serving as a"sounding board" mdependent of staff review. (As is done now with
CIB/CDBG budget, and was done by a committee of the PLwning Commission with NPPs.)
2. Coordination with other budget processes.
Not only is there a need to look ai this progrem withm the broader coniext of total pnblic
investinent in an area (from sow�ces outside this program}, but there is need over time, to look at
ihe balauce of programming across all available fimd'utg sources (withm ttee program). This is
particularly important in that the Capitai City Development Fund is not intending to use a"eycle"
(application deadline) but to allocate and presumably modify prograws on a contract basis.
3. Geographical and program balance
�
An outside review process wouitl provide oveisig�t on the ovetall distriibution of resources
among neighborhoods and 1yQes of progeam approaches. Such a review would aLso look at
issues of comgarability of approaches across PED "quadrauts," and relationsirips with
neighborhood organizations.
r^ � _ , L'� \
_�
PROFILE OF PR03ECT / PROGRAM REVIEW
EXAMPLE 1- SINGLfi PR03ECT, LTNIFIED CIB PROCESS
PRO7ECT: DAYTON'S BLiJFF RECREATION CENTER
DESCRIPTiOId: New buildiug and playground improvements
F[7NDING:
REVIEW PROCESS: Neighborhuod > CIB Community Facilities Task Force > CIB
Committee > Mayor > City Council
FOLLOW-UP: t7nce project is fvnded, departrnent proceeds. CIB would s�view any
major budget changes or fumre reqaests.
EXAMPLE 2- CI$ PROGRAM ALLOCATION, STAFF-ONLY SELECTION
OF PROJECT SITES
PROJECT: VACANT AND HAZARBOUS BUII.DING REMOVAL
DESCRIPTTON: Citywide fimd to demolish suuctures on a quick-decision needs basis.
FUNITING: 1946 -$1,000,000 CDBG. 1497 -$1,000,000 CDBG
REVIEW PROCESS: YED > CIB Residential and Economic Development Task Force > CIB
Committee > Mayor > City Council
FOLLOW-UP: CIB review only as budget line item, put of next fundiug cycle.
BXAMPLE 3- PROGRAM ALLOCATION, FI1TiJRE PROJECT REVIEW
PRO7ECT: CAPITAL MAI':�T'£E23ANCE PROGRAh4
DESCRIPTTON: Fund for r� of City buildings, facilities.
FCTNDING: 1996 -$1,40p,QaJ CIB. 1997 -$1,000,000 Cffi
REVIEW PROCESS: Budget Office > CIB Committee > Mayor > City Council
FOLLOW-UP: After allocation uf "fund" as a budget lme item, departmenLs submit
spec�c project requests > CIB/Staff sub-committee > CIB Committee
> Mayor > City Council (as a consent agenda item)
EXAMPLE 4-(NEV►� "INTERMEDIARY" PROGRAM FUNll, CONTRACTS
PROJECT: CAPTTAL CITY DEVEIAPMENT FiJND
DESCRIPTION: Combined-sowce neiglil>orhood redevelopment
FUNDINC: ??? CDBC + HOME + HRA, + Other
REV�W PROCESS: (for CDBrs program allocation) PED > CIB Residential and Economic
Development Task Force > CIB Comauttee > Mayor > City Council.
For other - ???
FOLIAW-UP: 13o review proposed for conuacts to CDCs, others. ConUracis are for more
than smgle site selection. CIB moniYOr of CDBG fimd balance.
�
�(�,�`-lq
,
�
Rondo Community Land Trust
To: Counciimember Jerry Blakey
Counciimember Mike Hatris
From: Kris Nelson, President �'
Rondo Community Land Trust
Date: Apri130, 1997
Re: Vacant Housing and the Capital Citp Bevelopment Program
We appreciate the opportunity to comment on the Gapital City Development PrQgrasn at taday's
policy meeting. Enclosed 'is a draft in which we focus on the vacant and boarded building
procedure, the current rehabilitation snbsidy levels, as well as t}ie Capital Eity Develogment
Pragram., � � �.
� In parCiculaz, �ve urge that.subsidy Tey"els far rehabilitatioa be�sert at $40,6D0 for single fanlily �` �
homes in order for these su6sidies to be used most effectively. VJithin the Jast few years, Rondn
CLT moved �ve honses ta vacant lots wiChin the;Suinmit-University / Lexington-Hamline
neighborhoods-and rehabilitate,d tkie strgctures. Each home required more tl�an $20,060 in� '�- �
subsidp and would have been demolished without the,availability of kigher subsidies. The
house§ now generate t�es for the city and benefits fot the neighborhood.
We would,like to continue contributiugxo the policy drscussion surrounding the Gapital City��� - �� �
DevelopmentProgram. Please coniact us if you have qnestions or require additional inforniation
�; regarding this draft. �Thank you. � � _ � _ � � � �
1183 Ashland Avenue St Pau1, MN 55414 (612) 64Z-0862
� l ��� !
Objecfive
The following summary exaxuuies St. Paul's procedure for_vacant and boazded buildings,
addresses the subsidy levels for rehabzlitation as set by the Houses to Homes program, and
reviews elements of the Capital City Development Program. Conclusions aze as follows:
1. Rehabilitation and reoccupation of vacant houses must become a city priority.
2. Subsidies must be set at a leveI that enables quality rehabilitation to occur:
3. In the creation of mini-block grants, STEiR funds must be included to ailow for resource
flexibility, and other issues should be addressed.
Vacant Buildings -
According to the recent Houses to Homes study conducted by Edward Goetz, there is an average
of 475 vacant houses on the Public Health Vacant Building list at any time. These vacant
houses tend to concentrate within St. Paul's lower-income neighborhoods where negati�Fe;impacts
such as the depression of surrounding property, values and erosion of the properiy taY base are
heightened. Vacattt houses are potential assets and resources for the city of St: Paul. Benefits .
from investments in rahabilitated housing spill over into the cotiununitythrough an mipxoved tax
base and a stabilizaxion in. surroundingneighborhoods. The costs associated with demolition .
negate these benefits, ye{ the current nuisanee policy adininistered by the city of St, Paul
aggressively pnshes vacant houses to demolition. _ The:-rate of demolifion outpaces new
construction witlra widening,gap. It is our premise that the yacant houses within tke city are
resources to be preserved, and we ask the ciry of St. Paul to strongly promote rehabilitation and
� reoccupation as st eitypriortty. Demolition must be the i�st x"esort, not the goal. --
The St. Paul Legislative'Code outli�es the procedu�e for abatemerit of a nuisance properiy; .
however, it does not outline a clear process for involving, outside patties who may be interested
in zehaliilitating a property s�iould the owner not wish to do, so. Structurally, sound houses have .,,
beemdemoIisked in part beoause outside parties were not able to intervene early enough to sava .
the bnildings. We recommend that at th� time a vacant building is Legistered; City Council,
� neighborhood Community Development Corpoiations; other kousing'organizations, ths District .
� Counc�l and�city depaztrnentssuc�k as PED ar� no�ifiecT as well the owner. At this stage, ajoint ��:
meating.should be held between the.owner of record, Public Health an& the notified pacties to
deternane ne� steps and.#o create a plan for nse and/or demolifiion. The foundatian for-this
process is put foi in. the St. Paul Legislative Code; Section 43.03, number 4, which states, "The
period of tima tlie building is expected to remain vacant; and a ptan and timetabte for retttrning
the building to appropriate occupancy ar use andJor for demolition of the building". The goal is
to work witti oumers of vacant buildings in order to make an early determination of the status of
tkte vacant structure.
Subsidies
The original Houses to Horrzes program included the following objectives: `to save existing'
housing stoek, wfiere feasible; to recapture and improve the City's tax base; to inerease
hdmeownership-opportunities; to contribute to the revita�f�ationand stabilization of "" ,
a �,���
neighborhoods; and to address vacant buildings tt�rough better coordination and City focus
througJ� code enforcement, rehabilitation and demolition. Houses to Homes subsidies were
established at a level that would allow the creation of lugh quality housing to attract middle
income people to the city and to preserve historic structures. Subsidy levels were set at $40,OQ0
for rehabilitation for single-family vacant houses.and $60;000 for rehabilitation and conversion
of multi-family units to single units.
As concluded in the Houses to Homes study, subsidies for rehabilitation do zesult in a net cast for
the city; however, rehabilitation provides benefits tiiat average one-half of the original subsidy
(net cost: $21,866). Demolifion is associated with lower upfront costs (appro�mately $9,000),
and lower properiy valuesfor surrounding areas. "Although subsidy appeazs fo be a much more
costly alternafive upfront ($40,000 subsidy compared to no subsidy for demolition), affer a
systematic review of costs and benefits, the difference between the two strategies is closer to
$12,000" ($21-9}. Adequate funding can help insure that vacant buildings are reoccupied. It
must be deternvned whether the benefits derived through rehabilitation are woxth the additional
expenditure and whether cunettt subsidy levels enable the development of quality housing that
best serves the needs of the ciry and its.residents.
We propose that the Houses to FIo»aes program * increase subsadie"s to the leveds originally ",
established by the Ciry Council ($40,000 and $65,0(JO).
•Honses m Homes may be incorporated into CapiYal City Homes.
Cagital City Development Pragrafn (CCDP), . -
"As stated in PEJ7's Capital Improvement Program.and Budget Process (GiB) PrQposal, flexible
- fmancing is needed to"assist variaus gzoups and individuals -in nndertakiug an assortment af .
hoine oreafion or improvemeut projects. Streamlining the funding procedure by collapsing
various programs and funds under one umbrella and disbursing mini-block grants, therefore, wili,- "
,� be benaficiaL STAIZ funrLs�shoulc�be included ivithin the urizbrelta, as the,se funds are the inost .. �
unresiricted resources available. Althougfi tfie STAR furids are most fleatible, the current"
application guidelines are cumbersome and this has, in effect, reduced the number of applicants'
to.the prograzn. The STAR eriteria ahould be reviewed to-determine ways in which flie fnnds can
be more readily accessed., � � , ,� � � � � � �
One goal of the CCDP_is to °decrease construction costs by eliminafing onerous btulding
requirements, in an effort to make public resources stretch further". Legislative meetings have
been held to address city requirements tfiat add unnecessazy cost; however, State Uniform
Building Codes supersede, City building code requirements. . We suggest, therefoxe, that St. Paul
and othermunicipalities crekte a separate taskforce to make recommenclations on possible State "
code changes.
Finally, each development project is unique. While predeternuned criteria are helpful in defining
city parameters, these criteria must be fle�ble iri allowing neighborhoods to define what
constitutes a priority. Also there must be adequate PED hausing staff to assist the neighborhoods
with development proposals. � � �
�'�'���
Recommendations
Tjacant Building Procedure
* Rehabilitation and Reoccupation of vacant houses should be a city priority, with demolition as
a last resort. �
*Create a notification procedure at the front end of the vacant building process. City Council,
neighborhood Distr'tct Councils, Community Development Corporations, land irusts and other
groups-shouid be notified during the vacant building registration process. A meeting should be
held between these groups and the owner to make an eariy determinatian of a.feasibie plan for
reoccupafion, rehabilitation or demolition..
*If rehabilitation or reoccupafion is not feasible, salvaging the building materials should be a
priority.
Subsidy Zevels -
*As under the Houses to Homes program, subsidies for rehabilitation should return to their ..
original� levels: � �
$40,000 for a single familyhouse and $6Q,OOQ for.conversion of multi-family units to a singie-
family unit. � � � � . _ � �
*For historic houses, a.separate fund shoutd be administered for those,projects exceeding the ,-,
subsidy limits of $40,000 and $6fl,0�0.
� CCDP. � , ° � � � � � � _
�� *IncIude STAR fdnds°in.t,he Capital City Homes grogram.. Reexamine STAR criteria in ozdai"to
�- � � m�ke this resource more xeadilg auailable for use. � � � � �
` *Because State Uniform Building,Codes supersede City codes, St. Paul and otfier municipalities _
', should form a task force to review wluch state codes oouid be. changed to make them more cost
, effecfive.
*Ensure that there is adequate PED staff to assist neighborhoods with development proposals.
Also PED and neighborhoods should use the same type of softwaze package for development
projects.
httpJ/freedom.stpaul.g.../legislative/Ic043.htm1
f. Condemned and illegally occupied; or
http://freedomstpaul.govlstpauUlegislariveQc043.htmi
c�� _7`�`1
g. Unoccupied for a periDd o£_time over three hundred sixty-five (365) days and
during which time the enforcement officer has issued an order to correct nuisance
conditions_
i0rd. No. 17862, I�section]7 1, 8-13-91) _ -
Sec. 43.03. Vacaat building�registration.
(a) The awnes shall register with the enforcement o£ficer not later than thirty (30)
days after any building zn trie city becomes a vacant building, as de£ined in section
43.02 (7) . .. - � .
(b) Trie registration sha11 be submitted on forms provided by the eaforcement officer
and shall include the following infoxmation supplied by the owner: �
il) A description of the premises;
(2) The names and addresses of the owner or owners;
(3) The names and addresses o£ all known lienholders and all other parties with an
ownership interest in the buildiiig; .
�--�(-4) The pesiod of time the building is expected ta remain vacant; and a-plan and
time'table for returning the building to appropriate occupancy or use.andfor for
demolition of the.building.
(5) A copy of any current Truth-in-Sale of Housing Disclosure Report as required by
Saint Paul� Le�islative Cod'e Chapter 189., � � � " � - " _ , " - � - , - . ,
(c) The ow�er,.shall submit a plan and,timetable which must meet trie approval of the
enforcement officer. The enforcement'officer shall xequire completion oE tfie plan
within a reasonable perj.od of time, up to three hundred sixty-five (365) days.,.The
plan subrr[itted ehall ;comply with the provision of Chapter_33 of the Sairit Paul -
I,egislative Code. Any repairs, improvements or alterations to the must
comply with any applicable housing or building codes.
{d) All applicable laws and codes sha11' be comglied_with.by the owner. The owner-
shall notify the enforcement officer of any changes in information supplied as part
of the vacant building registration within thirty (30) days of th'e change., Zf the
plan or timetable £or Ehe vacant building is revised in any way, the revis3ons must
meet the approval,of the'enforcement officer. -
`: (e) The owner and the subsequent owners sHa31 keep the building,secured and safe and
the bui2ding and ground properly maintained until the rehabiTitation or demolition
has been completed.
'(f� Fail'ure of the owner or any subsequexit owp.Ar to maintain the and� _
premises that resul£ in a summary abatement completed by.the city,shall be gronnds
for revocation of the approved�_plan and,shall be subject'to any applicable,penalties
provided by law.
(g) The new.owner(s) shall�register or re�-register the vacant�bu3lding with the �
enforcement officer within thirty (30)�days of any transfer of azi ownership interest-
in a vacant building. The new owner(s) shall comply with the approved plan and
timeCable svbmitted by the previous owner until any proposed changes are submitted
and meet the approval of the enforcement officer.
th) Vacant building £ees:'
(1) The owner of a vacant building shall pay an annual�fee�of�two hundred dollars.
($200:00) for the period the building��remains a vacant building. The fee shaZl be
reasonably related to the administra�ive costs for registering and processing the
vacant building owner registration form and-for the costs of the aity in monitorirag
the vacant building site. . . , - . -
�(2) The first annual fee shall be paid no later .than thirty (30) days after the
building becomes vacant. If the fee is not paid within thirty (3Q) days of being
2of3
04/30/97 13.33:53�
� � � � � � � � ��,��`1
, Bibliography
Fd Goetz. T'�e Fiscal Impacts of the St. Paul HOUSES TO HOMES Program. Center for Urban
and Regional Affairs. February 1997.
Sheryl Pemberton-Hoiby. Capital City Homes - Homeownership Development Oppornuuties
proposal. PED 199811999 LTnified Capitai Improvement Program and Budget Process.
St. Paul Legislative Code. Tnteme�
Endnotes
1. Edward Goetz. The Fiscal Impacts of the St. Paul HOUSES TO HOMES Pzogram. Center for
- Urban and Regional Affairs. February 1991:
2. Edward Csoetz. p 32
GT7-3�{g ✓
West 7thlFort Road Federattoa
974 Wast 7th Street
Saint Paul, Minnesota bb 102
(612)298-5b99
Apri130, 1997
Councilmembers Biakey and Harris
City of Saint Paul
Kellogg and Wabasha
Saint Paul, Minnesota 55102
Re: Capitol City Development Prograzn
Deaz Councilmembers,
In general, we support the proposed CCDP goals contained in the background section of the
pro�razn proposal. For your consideration, here aze some additional suggestions to strengthen the
program.
The University of Minnesota/CURA evaluation of the Houses to Homes program, utilizing a
typical reat estate appraisal formula, states that conservatively, investrnent has a 10 block ripple
effect. In lieu of this industry standazd and in light of the proposed guidelines, we wouid submit
the following guidelines for acquisition of vacant housing and redevelopment activities for your
consideration. Structures eligible under this program include any of the following:
i. Within 4 blocks of existing HOHO developments currently carrying deferred second
mortgages due and payable to the City of Saint Paul. The rntionale is that constant
diligence is required to protect past public and private investment and to stem
disinvestment trends in certaiu neighborhoods tequires long term attention.
2. Within 4 blocks of housing, commercSal or STAR projects currently cazrying fmancial
participation with the City of Saint Paui.
3. Within 1 block of a HLTD foreciosed home or tax forfeit pazcel occurring in the past two
yeazs.
4. Development funds would be auailabie to the Federation to purchase homes from seniors
who move into the Holm and Olson senior rentai housing development. The rationale is
that the goal of the Hoim and Olson development is to fmd life cycle suitable housing for
senioxs in the community, maintain current homeownership levels in the community, and
support redevelopment of a community througti better utilization of land and increased
tax base.
5. CCDP funds would be availabie to address problem properties which have a current case
history with departments of the City of Saint Paui.
Cooperatu'�gFund Drive Member
Affirmative ActiorYEqval Opportunity Employer
�� 3`(9
We support a cost reduction analysis study �vhich �vould reduce current development
requirements that have little benefit to the project, i.e. fire sprinkler requirement.
Given the goal of creating economically inie,,urated neiahborhoods. CCDP funds should provide
tlesibility in meeting this need for developers utilizing this proerani.
We strongly support the concept of poolin� the subsidy levels for a batch of homes jointly be
developed. This will gice developers more flexibility in responding to the general conditions of
the property. We do not think the proposed subsidy levels are workable at the $20,000 and
$25,000 level and do not understand the distincrion between the current high subsidy level for
new construction and this (evel for rehabilitated stcuctures.
We would suggest that PED provide historicat information regazding construction building
material costs since the inception of the program.
S � ly ►�+�^"
Richazd Miller, President
c: City Council President Thune