HomeMy WebLinkAboutHousing & Redevelopment Authority Packet 06-22-2023Housing and Redevelopment Authority 1 of 2 June 22, 2023
CITY OF PLYMOUTH
AGENDA
Regular Housing and Redevelopment Authority
June 22, 2023, 7:00 PM
1. CALL TO ORDER
2. PUBLIC FORUM—Individuals may address the HRA about any item not contained on the regular
agenda. A maximum of 15 minutes is allotted for the Forum. If the full 15 minutes are not needed for the
Forum, the HRA will continue with the agenda. The HRA will take no official action on items discussed at
the Forum, with the exception of referral to staff for future report.
3. APPROVE AGENDA —HRA members may add items to the agenda for discussion purposes or staff
direction only. The HRA will not normally take official action on items added to the agenda.
4. CONSENT AGENDA —These items are considered to be routine and will be enacted by one motion.
There will be no separate discussion of these items unless HRA member or citizen so requests, in which
event the item will be removed from the Consent Agenda and placed elsewhere on the agenda.
4.1 HRA Minutes
Housing & Redevelopment Authority Minutes 03-23-2023
4.2 Accept Plymouth Towne Square monthly housing reports and financials
Plymouth Towne Square Monthly Report March 2023
Plymouth Towne Square Monthly Report April 2023
Plymouth Towne Square Housing Report May 2023
4.3 Accept Vicksburg Crossing monthly housing reports and financials
Vicksburg Crossing Housing Report April 2023
Vicksburg Crossing Housing Report May 2023
5. PUBLIC HEARINGS
6. NEW BUSINESS
6.1 General Amendment to the 2022 Community Development Block Grant Annual
Action Plan - TreeHouse
HRA Staff Report for General Amendment 2022 TreeHouse CDBG Allocation June
22
2023-06 HRA Resolution for General Amendment 2022 TreeHouse CDBG
Allocation June 22
1
Housing and Redevelopment Authority 2 of 2 June 22, 2023
6.2 Plymouth Towne Square - CDBG Fund Usage for Elevator Modernization
6.3 First-Time Homebuyer Program - Update Asset Limit Requirement
Current First Time Homebuyer Program Guidelines
7. UPDATES
8. ADJOURNMENT
2
Regular
Housing and
Redevelopment
Authority
June 22, 2023
Agenda
Number:4.1
To:Dave Callister, City Manager
Prepared by:Kenny Niemeyer, Housing and Economic Development
Coordinator
Reviewed by:
Item:HRA Minutes
1. Action Requested:
Staff recommends approval of the March 23, 2023 HRA Minutes
2. Background:
The March 23, 2023 minutes are attached.
3. Budget Impact:
N/A
4. Attachments:
Housing & Redevelopment Authority Minutes 03-23-2023
3
DRAFT MINUTES
PLYMOUTH HOUSING AND REDEVELOPMENT AUTHORITY
MARCH 23, 2023
MEMBERS PRESENT: Chair Michelle Soderberg, Commissioners Wayne Peterson, James Williams, Aqueelah
Whitfield, and Ronald Kelner
ABSENT: Commissioner Joel Spoonheim
STAFF PRESENT: HRA Executive Director Grant Fernelius, Support Services Manager Denise Whalen,
Housing and Economic Development Coordinator Kenny Niemeyer, Permit Technicians Jenny Bailey, and
Michelle Bast.
OTHERS PRESENT: Mayor Jeffry Wosje and Jody Boedgheimer of Grace Management
1. CALL TO ORDER
Chair Soderberg called the Plymouth Housing and Redevelopment Authority meeting to order at
7:00 p.m.
2. PUBLIC FORUM
Chair Soderberg opened the public forum.
Patrick LaCombe of Outreach Development Corporation in association with I.O.C.P and advocates for
affordable housing. He stated they have worked with the city for two decades to promote affordable
housing. With new members on the HRA they are looking forward to continuing building partnerships
with the HRA. He stated their organization would like to edit and suggest alternative language on the
draft moderate income housing policy before it comes back to the HRA for consideration. He requested
that item 4.5 – Resolution Decertifying Tax Increment Financing District 1-2 be removed from the
Consent Agenda. He stated he is not certain that decertification needs to take place tonight. He stated
his colleague, Ed Goldsmith, can address this in more detail. He reinforced working together and
continuing the relationship between the HRA and Outreach Development Corporation.
Chair Soderberg stated the moderate-income draft policy has been tabled due to staff turnover and
will be revisited in the future. At that time, the policy will become an agenda item and will be open for
comment.
Chair Soderberg asked for a motion to move item 4.5 on the Consent Agenda to New Business as item
6.5.
MOTION by Commissioner Williams, seconded by Commissioner Peterson to approve the
Consent Agenda. Vote. 5 Ayes. MOTION passed unanimously.
Chair Soderberg closed the public forum.
4
Draft Minutes
Plymouth Housing and Redevelopment Authority
March 23, 2023
Page #2
3. APPROVE AGENDA
MOTION by Commissioner Peterson, seconded by Commissioner Williams to approve
the agenda as amended. Vote. 5 Ayes. MOTION passed unanimously.
4. CONSENT AGENDA
4.1. Approved minutes from December 1, 2022.
4.2. Plymouth Towne Square. Accept Monthly Housing Reports.
4.3. Vicksburg Crossing. Accept Monthly Housing Reports.
4.4. Appoint HRA Executive Director Grant Fernelius.
4.5. Resolution Decertifying Tax Increment Financing District 1-1.
MOTION by Commissioner Peterson, seconded by Commissioner Kelner to approve the Consent
Agenda. Vote. 5 Ayes. MOTION passed unanimously.
5. PUBLIC HEARINGS
5.1. Program Year 2023 Community Development Block Grant (CDBG) Annual Action Plan
Housing and Economic Development Coordinator Kenny Niemeyer gave overview of the staff report.
Chair Soderberg opened the public hearing.
Ellen Timmerman-Borer, Chief Development Officer of Hammer Residences, Inc. expressed her
thankfulness for the support of the HRA to make the homes accessible and provide staff with resources.
She said it is the 100th anniversary of Hammer Residences, Inc. They have recently acquired a business on
the east side of the metro. She expressed that because of their work with the City of Plymouth they are
positioned to do more work. She repeated her thankfulness for the support of the HRA.
Chair Soderberg closed the Public Hearing.
MOTION by Commissioner Williams, seconded by Commissioner Peterson, to approve Resolution
2023-01 approving the application and allocation of fiscal year 2023 Community Block Grant
funds. Vote. 5 Ayes. MOTION passed unanimously.
6. NEW BUSINESS
6.1. General Amendment to the 2022 Community Development Block Grant Annual Action Plan –
5
Draft Minutes
Plymouth Housing and Redevelopment Authority
March 23, 2023
Page #3
Senior Community Services
Housing and Economic Development Coordinator Kenny Niemeyer gave overview of the staff report.
Commissioner Kelner asked the dollar amount of the funds to be allocated.
Housing and Economic Development Coordinator Kenny Niemeyer responded $15,200.
MOTION by Commissioner Williams, seconded by Commissioner Whitfield, to approve Resolution
2023-02 allocating an additional $15,200 from the2022 Community Development Block Grant
funds to Senior Community Services . Vote. 5 Ayes. MOTION passed unanimously.
6.2 General Amendment to the 2022 Community Development Block Grant Annual Action Plan -
Administration
Housing and Economic Development Coordinator Kenny Niemeyer gave overview of the staff report.
Commissioner Kelner asked what the initial amount allocated was.
Housing and Economic Development Coordinator Kenny Niemeyer responded $22,410.
Commissioner Williams asked why the expenses were exceeded.
Housing and Economic Development Coordinator Kenny Niemeyer stated the recommendation has
been to allocate $20,000 to free up money for other programs. However, now a spend down is needed
to pay costs that have already been incurred.
Chair Soderberg added that they had been using HRA money to cover costs and she encouraged the HRA
to pull the money from CDBG where expenses should be accurately reflected.
MOTION by Commissioner Kelner, seconded by Commissioner Williams, to approve Resolution
2023-03 allocating an additional $50,000 for program administration for the 2022 Community
Development Block Grant Program. Vote. 5 Ayes. MOTION passed unanimously.
6.3 General Amendment to the 2022 Community Block Grant Annual Action Plan – HOME Line
Housing and Economic Development Coordinator Kenny Niemeyer gave overview of the staff report.
MOTION by Commissioner Kelner, seconded by Commissioner Whitfield, to approve allocating an
addition $4,050 from the 2022 Community Development Block Grant funds to HOME Line. Vote. 5
Ayes. MOTION passed unanimously.
6
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Plymouth Housing and Redevelopment Authority
March 23, 2023
Page #4
6.4 Election of Officers. Chair, Vice-Chair, Secretary.
MOTION by Commissioner Peterson, seconded by Commissioner Williams, to nominate
Commissioner Soderberg as Chair. Vote. 5 Ayes. MOTION passed unanimously.
MOTION by Commissioner Williams, seconded by Commissioner Soderberg, to nominate
Commissioner Peterson as Vice-Chair. Vote. 5 Ayes. MOTION passed unanimously.
MOTION by Commissioner Peterson, seconded by Commissioner Williams, to nominate
Commissioner Whitfield as Secretary. Vote. 5 Ayes. MOTION passed unanimously.
6.5 Resolution Decertifying Tax Increment Financing District 1-1
HRA Executive Director Fernelius gave an overview of the staff report.
Commissioner Peterson asked if the TIF District is not related to a particular parcel.
HRA Executive Director Fernelius stated the TIF District was for one 28-acre parcel of land. There is
a geographic boundary where the TIF was collected. There is flexibility under state law to pool
money for affordable housing and the maximum threshold has been reached for that and for
infrastructure improvements.
Commissioner Peterson asked if there is an advantage for the HRA to have a TIF in place to assist
with projects.
HRA Executive Director Fernelius responded that there is a requirement by law to decertify the TIF
District when the bonds and obligations have been paid in full and all other costs of the project
have been paid. He added that the pooling capacity for the district has been maximized.
Commissioner Williams asked if there is a specific time frame to decertify the TIF District and if the
Board must act on it immediately.
HRA Executive Director Fernelius responded that it is not necessary to approve the decertification
immediately; however, it does need to be done by the end of 2023 to stay compliant. He stated
the analysis has been done and the recommendation has been made.
Commissioner Williams asked if the recommendation was made by Ehlers and Associates.
HRA Executive Director Fernelius replied affirmatively.
Chair Soderberg summarized the district is done, the improvements have been made, and the
pooling capacity maximized and recommend the board move forward with decertifying TIF District
7
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Plymouth Housing and Redevelopment Authority
March 23, 2023
Page #5
1-1.
MOTION by Commissioner Kelner, seconded by Commissioner Whitfield, to approve Resolution
2023-5 decertifying Tax Increment Finance District No. 1-1. Vote. 5 Ayes. MOTION passed
unanimously.
7. UPDATES
Staffing Vacancy
HRA Commissioner Vacancy
8. ADJOURNMENT
MOTION by Chair Soderberg, with no objection, to adjourn the meeting at 7:33 p.m.
8
Regular
Housing and
Redevelopment
Authority
June 22, 2023
Agenda
Number:4.2
To:Dave Callister, City Manager
Prepared by:Kenny Niemeyer, Housing and Economic Development
Coordinator
Reviewed by:
Item:Accept Plymouth Towne Square monthly housing reports and
financials
1. Action Requested:
Accept attached Plymouth Towne Square monthly housing reports and financials.
2. Background:
Plymouth Towne Square monthly housing reports and financials.
3. Budget Impact:
N/A
4. Attachments:
Plymouth Towne Square Monthly Report March 2023
Plymouth Towne Square Monthly Report April 2023
Plymouth Towne Square Housing Report May 2023
9
MEMORANDUM
To: Denise Whalen
From: Lyn Donahue
Date: April 3, 2023
RE: Plymouth Towne Square Monthly Report for March 2023.
Rentals:
Apartment Type Occupied Vacant Deposits Estimated Move in
1 Bedroom 59 1 1 4/15/2023
2 Bedroom
1-Bath 20 0 0
2 Bedroom
2-Bath 19 0 0
Totals 98 1 1
Move-Ins/Move-Outs:
As of March 31st, we had one vacancy for half the month.
Marketing
The wait lists remain open. Waiting lists are currently being updated, checking status of applicant as to
whether they are still interested in remaining on the list. We receive inquiry calls daily and send
applications out when requested.
10
Resident Services
On Thursdays, residents have Morning Coffee. Cards are played Monday, Tuesday and Wednesdays.
Movie Night once a month with 23 attending. The Resident Meeting and Birthday Celebration is the 3rd
Thursday of each month. Quarters (for laundry), postage stamps and greeting cards are sold every
Wednesday. There is a weekly knitting/crocheting group that meets in the fireside room. Schwan’s
Frozen Food delivers every other Wednesday. Twice a month there is a women’s bible study.
AARP came to the building and completed the income tax returns at no charge for 38 residents.
Building Issues
Nothing to report on.
11
MEMORANDUM
To: Denise Whalen
From: Lyn Donahue
Date: May 9, 2023
RE: Plymouth Towne Square Monthly Report for April 2023.
Rentals:
Apartment Type Occupied Vacant Deposits Estimated Move in
1 Bedroom 60 0 0
2 Bedroom
1-Bath 19 1 1 May 15th move in
2 Bedroom
2-Bath 19 0 0
Totals 98 1 1
Move-Ins/Move-Outs:
As of April 30th, there was one vacant two bedroom.
We had one move in on April 15th to the one bedroom.
Marketing
The wait lists remain open. Waiting lists are currently being updated, checking status of applicant as to
whether they are still interested in remaining on the list. We receive inquiry calls daily and send
applications out when requested.
12
Resident Services
On Thursdays, residents have Morning Coffee. Cards are played Monday, Tuesday and Wednesdays.
Movie Night once a month. The Resident Meeting and Birthday Celebration is the 3rd Thursday of each
month. Quarters (for laundry), postage stamps and greeting cards are sold every Wednesday. There is a
weekly knitting/crocheting group that meets in the fireside room. Schwan’s Frozen Food delivers every
other Wednesday. Twice a month there is a women’s bible study.
Building Issues
Nothing to report on.
13
14
15
Regular
Housing and
Redevelopment
Authority
June 22, 2023
Agenda
Number:4.3
To:Dave Callister, City Manager
Prepared by:Kenny Niemeyer, Housing and Economic Development
Coordinator
Reviewed by:
Item:Accept Vicksburg Crossing monthly housing reports and
financials
1. Action Requested:
Accept Vicksburg Crossing monthly housing reports and financials.
2. Background:
Accept Vicksburg Crossing monthly housing reports and financials.
3. Budget Impact:
N/A
4. Attachments:
Vicksburg Crossing Housing Report April 2023
Vicksburg Crossing Housing Report May 2023
16
MEMORANDUM
To: City of Plymouth HRA
From: Sara Paquette
Date: May 9, 2023
RE: Vicksburg Crossing Monthly Report for April 2023
Rentals:
As of April 30th, we have 95 occupied apartments. We currently have 0 deposits, giving us a total of 0
apartments available to rent. The affordable apartment waiting list now has 129 names and we have been
adding interested people to the list. We have 43 people on our moderately priced one-bedroom wait list
and 37 people on our moderately priced 1+ and two-bedroom wait list.
Style (Total #) Square Feet Bedrooms
Occupied
Vacant
Deposits
Est’d Move in
Style A (23) 850 Sq Ft 1 Bedroom
23
0
0
Style C (8) 884 Sq Ft 1 + Den 8 0 0
Style C2 (8) 950 Sq Ft 1 + Den 8 0 0
Style D (8) 1187 Sq Ft 2 Bedroom 8 0 0
Style D2 (4) 1281 Sq Ft 2 Bedroom 4 0 0
Style E (8) 1055 Sq Ft 2 Bedroom 8 0
0
Style E2 (3) 1055 Sq Ft 2 Bedroom 3 0 0
Affordable
(33) 725 Sq Ft 1 Bedroom 33 0
0
TOTALS 95 0 0
17
Move-Ins/Move-Outs:
We had no residents move in or out during the month of April.
Marketing
We are starting to get many more phone calls inquiring about availability, and the possibility of
scheduling a tour. We continue to maintain strong waiting lists.
Resident Services
National Volunteer week is in April so, on Wednesday, April 12th, we had a volunteer appreciation
luncheon. At Vicksburg Crossing we have great volunteers, that contribute in many different ways.
Some residents volunteer at community parties, others open their apartments for tours, and residents also
help plant all the beautiful flower pots around the building. Management feels it is important to
acknowledge all they do to make Vicksburg Crossing a desirable place to live.
Our monthly birthday party was on Thursday, April 20th. We decorate the room with a birthday banner,
festive napkins and plates. We list the residents who have a birthday during the month on a poster, then
we sing Happy Birthday, followed by cake and ice cream. We also give each resident a birthday card.
Building Issues
This month we had common area furniture and flooring cleaned, and we also offer to clean resident’s
apartment carpet every three years.
We had our annual Fire Department inspection.
18
MEMORANDUM
To: City of Plymouth HRA
From: Sara Paquette
Date: June 6, 2023
RE: Vicksburg Crossing Monthly Report for May 2023
Rentals:
As of May 31st, we have 95 occupied apartments. We currently have 0 deposits, giving us a total of 0
apartments available to rent. The affordable apartment waiting list now has 132 names. We have 47
people on our moderately priced one-bedroom wait list and 38 people on our moderately priced 1+ and
two-bedroom wait list.
Style (Total #) Square Feet Bedrooms
Occupied
Vacant
Deposits
Est’d Move in
Style A (23) 850 Sq Ft 1 Bedroom
23
0
0
Style C (8) 884 Sq Ft 1 + Den 8 0 0
Style C2 (8) 950 Sq Ft 1 + Den 8 0 0
Style D (8) 1187 Sq Ft 2 Bedroom 8 0 0
Style D2 (4) 1281 Sq Ft 2 Bedroom 4 0 0
Style E (8) 1055 Sq Ft 2 Bedroom 8 0
0
Style E2 (3) 1055 Sq Ft 2 Bedroom 3 0 0
Affordable
(33) 725 Sq Ft 1 Bedroom 33 0
0
TOTALS 95 0 0
19
Move-Ins/Move-Outs:
We had no residents move in or out during the month of April.
Marketing
We are still getting a lot of phone calls inquiring about availability and tours.
Resident Services
We had a Cinco de Mayo party on Friday, May 5th. We ordered tacos from Cub, we also had fruit, dessert
and margarita punch. The residents enjoyed the food, and the opportunity to socialize.
Our monthly birthday party was on Thursday, May 18th. We decorate the room with a birthday banner,
festive napkins and plates. We list the residents who have a birthday during the month on a poster, then
we sing Happy Birthday, followed by cake and ice cream. We also give each resident a birthday card.
Building Issues
This month we had our underground parking garage cleaned.
We had to have 9 complete MagicPak heating/cooling units replaced, and 1 heat exchanger.
Cracked concrete had to be replaced, and some concrete had to be leveled, to prevent a tripping hazard.
20
Regular
Housing and
Redevelopment
Authority
June 22, 2023
Agenda
Number:6.1
To:Dave Callister, City Manager
Prepared by:Kenny Niemeyer, Housing and Economic Development
Coordinator
Reviewed by:
Item:General Amendment to the 2022 Community Development
Block Grant Annual Action Plan - TreeHouse
1. Action Requested:
Staff recommends approval of Resolution No. 2023-06
2. Background:
The Community Development Block Grant (CDBG) is a federally funded program administered by the
U.S. Department of Housing & Urban Development (HUD). The City of Plymouth HRA allocates
funding from its CDBG allocation to public service organizations who provide services to residents of
Plymouth. The public service organization TreeHouse was originally allocated $15,000 of 2022 CDBG
Funds. As of 4/26/2022, TreeHouse utilized $5,738.38 of its original allocation of $15,000, and expects
to utilize approximately $1,482.87 for Q4 of the 2022 CDBG program year. CDBG funding helped
TreeHouse serve seven Plymouth youth who were at-risk of homelessness. The proposed
amendment will decrease the grant amount to match TreeHouse’s stated financial need for serving
Plymouth residents for the remainder of the 2022 CDBG Program Year.
3. Budget Impact:
Matching of CDBG grant amount to organization's stated financial need - freed up funding will be
reallocated to other CDBG activities
4. Attachments:
HRA Staff Report for General Amendment 2022 TreeHouse CDBG Allocation June 22
2023-06 HRA Resolution for General Amendment 2022 TreeHouse CDBG Allocation June 22
21
Agenda Number 6.1
PLYMOUTH HOUSING AND
REDEVELOPMENT
AUTHORITY
STAFF REPORT
TO: Plymouth Housing and Redevelopment Authority
FROM: Kenny Niemeyer, Housing and Economic Development
Coordinator
MEETING DATE: June 22, 2023
SUBJECT: General Amendment to the City of Plymouth’s 2022
Community Development Block Grant Annual Action Plan
TreeHouse Line allocation
BACKGROUND:
The Community Development Block Grant (CDBG) is a federally funded program
administered by the U.S. Department of Housing & Urban Development (HUD). The City
of Plymouth HRA allocates funding from its CDBG allocation to public service
organizations who provide services to residents of Plymouth.
The public service organization TreeHouse was originally allocated $15,000 of 2022
CDBG Funds. As of 4/26/2022, TreeHouse utilized $5,738.38 of its original allocation of
$15,000, and expects to utilize approximately $1,482.87 for Q4 of the 2022 CDBG
program year. CDBG funding helped TreeHouse serve seven Plymouth youth who were
at-risk of homelessness. The proposed amendment will decrease the grant amount to match
TreeHouse’s stated financial need for serving Plymouth residents for the remainder of the
2022 CDBG Program Year.
RECOMMENDATION:
Staff recommends approval of Resolution No. 2023-04.
The public service organization TreeHouse has communicated to HRA staff that, due to
decreasing need for their services in Plymouth, they expect to expend $7,221.25 of their
original allocation of $15,000. Staff recommend decreasing TreeHouse’s allocation of
2022 CDBG funds to $7,650, freeing up $7,350 of CDBG funds for other activities.
22
ATTACHMENTS:
1. Resolution No. 2023-06
23
223701v1
CITY OF PLYMOUTH
HRA RESOLUTION 2023-06
A RESOLUTION TO APPROVE A GENERAL AMENDMENT OF THE 2022
COMMUNITY DEVELOPMENT BLOCK GRANT ANNUAL ACTION PLAN
WHEREAS, the City of Plymouth (“City”) has delegated its responsibility for the expenditure of
Community Development Block Grant (CDBG) funds to the HRA pursuant to the Management
Services Agreement dated the 17th day of November, 1995, between the City and the HRA; and
WHEREAS, the HRA and Sub-grantee are parties to that certain Subgrantee Agreement dated July
1, 2022, relating to Sub-grantee’s allocation and use of Federal Fiscal Year 2022 Community
Development Block Grant (“CDBG”) funds (the “2022 Sub-grantee Agreement”); and
WHEREAS, the City of Plymouth intends to submit a general amendment to the U.S. Department of
Housing and Urban Development for the City of Plymouth’s 2022 CDBG Annual Action Plans and
held a duly constituted public comment period as required by its Citizen Participation Plan General
Amendment requirements; and
NOW, THEREFORE, BE IT RESOLVED BY THE HOUSING AND REDEVELOPMENT
AUTHORITY OF THE CITY OF PLYMOUTH, MINNESOTA, that it hereby recommends that the
City Council authorize the City Manager to reduce the Sub-grantee’s allocation of 2022 Community
Development Block Grant funds from the U.S. Department of Housing and Urban Development by
the following amount:
• TreeHouse (7,350.00)
Pending final approval by the City Council, the City of Plymouth will submit the general
amendment to the U.S. Department of Housing and Urban Development for approval.
24
223701v1
Approved this 22nd day of June, 2023 by the Plymouth Housing and Redevelopment Authority.
_________________________________
Michelle Soderberg, Chair
_________________________________
Grant Fernelius, Executive Director
25
Regular
Housing and
Redevelopment
Authority
June 22, 2023
Agenda
Number:6.2
To:Dave Callister, City Manager
Prepared by:Kenny Niemeyer, Housing and Economic Development
Coordinator
Reviewed by:
Item:Plymouth Towne Square - CDBG Fund Usage for Elevator
Modernization
1. Action Requested:
Discuss opportunity to utilize unallocated CDBG funds for elevator modernization at Plymouth
Towne Square
2. Background:
Elevator modernization is needed for two elevators in Plymouth Towne Square. Elevator
modernization was approved as a capital expense by the HRA for the 2023 HRA budget.
The City of Plymouth currently has approximately $170,000 in unallocated CDBG funds. These funds
are available for usage because program income from CDBG loan payoffs have been frequent in
recent years, including the payoff of the CDBG Loan to Heartland-Plymouth Lakeview Commons, LLC
for $77,681.48 in 2022.
Utilizing CDBG funding to pay for elevator modernization at Plymouth Towne Square would help the
Plymouth CDBG program meet spenddown timeliness requirements set by HUD. HRA staff
recommend discussing the option of using unallocated CDBG funding to pay for elevator
modernization in Plymouth Towne Square.
3. Budget Impact:
Utilization of CDBG funds would free up HRA budget for other needs
4. Attachments:
26
Regular
Housing and
Redevelopment
Authority
June 22, 2023
Agenda
Number:6.3
To:Dave Callister, City Manager
Prepared by:Kenny Niemeyer, Housing and Economic Development
Coordinator
Reviewed by:
Item:First-Time Homebuyer Program - Update Asset Limit
Requirement
1. Action Requested:
HRA staff recommend updating the First-Time Homebuyer Program's asset limit to match current
housing market needs and align with requirements of peer-communities' first time homebuyer
programs
2. Background:
The First-Time Homebuyer Program currently requires applicants' assets, at time of application, to
be no more than $25,000. According to anecdotes received from lenders and real estate agents, and
in the experience of HRA staff, the current asset limit requirement results in exclusion of potential
clients who self-disqualify by saving money with the intent of purchasing a home.
Allowing clients of the First-Time Homebuyer Program to use dedicated savings for the purchase of
a home will help them afford property in Plymouth's difficult housing market ($470,000 median
sales price for homes in Plymouth over the past 12 months vs. $370,000 in Hennepin County).
HRA staff recommend updating the First-Time Homebuyer Program's asset limit to align with
peer-communities' program requirements.
Potential asset limits to mirror include the following:
Minnesota Housing Finance Agency - A Borrower’s liquid assets after closing are limited to the
greater of eight months principal, interest, taxes, insurance, and association fee (PITIA) or $12,000.
Dakota County CDA - Eligible applicants cannot have Assets greater than $60,000.00.
Bloomington - No asset limit.
Additional option - After closing, must not have Gross Assets exceeding $25,000.00, which excludes
one automobile per adult permanently residing in the home.
3. Budget Impact:
No impact to budget
27
4. Attachments:
Current First Time Homebuyer Program Guidelines
28
FIRST TIME HOMEBUYER PROGRAM
GUIDELINES
CITY OF PLYMOUTH
HOUSING AND REDEVELOPMENT AUTHORITY
3400 Plymouth Boulevard, Plymouth, MN 55447
Revised January 2021
29
TABLE OF CONTENTS
PART I: GENERAL PROGRAM DESCRIPTION
Program Overview 1
Program Goals 1
Program Administration 1
Purpose of the Program Guidelines 2
PART II: PROGRAM POLICIES & PROCEDURES
Financial Assistance 2
Responsibilities of the First Time Homebuyer 3
Responsibilities of the Lender 4
Responsibilities of the HRA 4
Application to the HRA 5
Summary of the Application Process 5
Eligibility Requirements 6
Denial of Eligibility 6
Eligible Dwellings 6
Applicant Outreach 7
Applicant Pool 7
Selection from the Applicant Pool 7
Lender Outreach 8
PART III: PROGRAM RULES
Lenders 9
Declarations of Restrictive Covenants 9
Lead Based Paint Hazard Requirements 9
Repayment of Assistance 10
Loan Modification 10
Subordination of Mortgages 10
Targeted Funding 12
Total Amount of Assistance 12
Modification and Termination of Program 12
APPENDIX A
Definitions 13
30
1
PART I: GENERAL PROGRAM DESCRIPTION
Program Overview
The Plymouth Housing and Redevelopment Authority (HRA) operate an assistance program for
homeownership funded by the City of Plymouth’s Community Development Block Grant (CDBG)
Program. The HRA operates this program on behalf of and as the agent of the City of Plymouth.
The First Time Homebuyer Program provides financial assistance for low- and moderate-income
Households to become homeowners.
Administration of the First Time Homebuyer Program and the functions and responsibilities of the
HRA staff shall be in compliance with the U.S. Department of Housing and Urban Development
(HUD) CDBG regulations as well as all Federal, State and local nondiscrimination laws and with
the rules and regulations governing Fair Housing and Equal Opportunity in housing and
employment.
The HRA shall not deny any Family or individual the equal opportunity to apply for or receive
assistance under the First Time Homebuyer Program on the basis of race, color, gender, religion,
creed, national origin, age, familial or marital status, handicap or disability, sexual or affectional
orientation or reliance on public assistance.
The Plymouth HRA’s office is accessible to persons with disabilities. Accessibility for the hearing
impaired is provided by the Minnesota Relay Service and the City of Plymouth TDD.
Program Goals
The First Time Homebuyer Program has the following two goals:
a. Assist low- and moderate-income families to purchase homes within the City of
Plymouth by providing assistance with down payment, closing costs and mortgage
principal reduction.
b. Promote responsible home ownership.
Program Administration
The Program will be administered through the Plymouth HRA. Interested applicants should
contact the Plymouth HRA staff by calling (763) 509-5410, emailing housing@plymouthmn.gov,
or appearing in person at 3400 Plymouth Boulevard, Plymouth, MN 55447.
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Purpose of the Program Guidelines
The purpose of these Guidelines is to establish policies for carrying out the First Time Homebuyer
Program in a manner consistent with HUD requirements and local goals and objectives contained
in the Consolidated and Annual Action Plans. The HRA is responsible for complying with all
changes in HUD regulations pertaining to the CDBG program. If such changes conflict with these
Guidelines, HUD regulations will have precedence. Applicable regulations include:
24 CFR Part 5: General Program Requirements
24 CFR Part 8: Nondiscrimination
24 CFR Part 570: Community Development Block Grant
24 CFR Part 35: Lead Based Paint Regulations
PART II: PROGRAM POLICIES & PROCEDURES
Financial Assistance
The HRA provides financial assistance to homebuyers to more readily secure a first mortgage.
The Program assistance may be used to:
♦ Pay up to 50 percent of the amount the homebuyer(s) is required to provide toward the down
payment under the particular mortgage program they are utilizing, not to exceed $5,000.
♦ Pay up to 100 percent of the homebuyer’s eligible closing costs not to exceed $7,500.
Borrowers are not permitted to use Program funds for interest rate buy downs unless
documentation is provided from the lender that shows the buy down is necessary to secure
their primary mortgage. Eligible closing costs do not include optional insurances (i.e. optional
owner’s insurance policy etc.).
♦ Reduce the mortgage principal up to 15% of the purchase price, not to exceed $30,000
♦ The applicant (s) Housing (DTI) Debt to Income Ratio must be at least 25%, but cannot exceed
45% of their gross monthly qualifying income.
The financial assistance will be provided at a minimum amount of $3,000.00 and a maximum
amount of $35,000.00. In certain situations, the HRA Executive Director may allow assistance in
excess of the maximum at their discretion. The HRA will make a determination on the amount of
assistance for which an applicant qualifies. The HRA will make this determination after reviewing
the applicant’s verified income and assets, estimated Closing Costs, purchase agreement, and
lender’s recommendations for financial assistance in compliance with uses described above.
Lenders must provide a pre-approval letter indicating the maximum amount of financing the
borrower would qualify for from the first mortgage lender.
The HRA will verify an applicant’s income and assets through third party written verifications as
provided by either the lender or as sought by the HRA. The HRA may re-verify income and asset
information provided by the lender. The HRA will calculate the applicant’s Gross Annual Income
using pay stubs and recent tax returns or third party verification as defined in Appendix A to ensure
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the Applicant(s) qualifies as a low- or moderate-income Household as required by CDBG
regulations and to determine the maximum amount of assistance.
Financial assistance will be provided at the time of Closing on the property with the following
conditions:
♦ Selected applicants must meet the requirements of this Program and be eligible for the financial
assistance throughout the entire application process.
♦ The housing unit to be purchased and the purchase price must be accepted by the HRA as
meeting the intent and requirements of the program.
♦ The financial assistance provided by the HRA is in the form of a no interest deferred payment
loan that is due and payable 30 years from the initial purchase date or when the house is sold,
transferred or no longer the primary place of residence, whichever occurs first.
♦ The homebuyers must enter into a second mortgage and execute a Promissory Note with the
HRA providing for repayment of the indebtedness 30 years from the initial purchase date or
when the house is sold, transferred or no longer the primary place of residence, whichever
occurs first.
Responsibilities of the First Time Homebuyer
The responsibilities of the prospective homebuyers are to:
♦ Complete, sign and return the Application, Authorization for the Release of Information form,
and other certification and verification forms within the time frame specified.
♦ Register and attend the Home Stretch - Home Buyers Workshops offered by Community
Action Partnership of Hennepin County (CAP-HC). Classes must have been completed within
12 months prior to closing. Classes offered through other agencies or realtors may be
substituted with prior approval of the HRA. Applicants must also attend an individual
counseling session with a Housing Counselor at CAP-HC. If CAP-HC recommends that the
applicant is not ready to purchase a home, the HRA may not provide assistance until the
applicant has satisfied staff concerns. The applicant will be provided with a certificate of
attendance. A copy of this certificate should be forwarded to the lender and the HRA.
♦ Select a lender approved by the HRA for participation in the Program.
♦ Complete the pre-approval process.
♦ Select a real estate agent, if one is desired.
♦ Select a dwelling in Plymouth for purchase that is owner-occupied or vacant and is an eligible
dwelling under the Program.
♦ Provide information throughout the process as required by the lender or HRA.
♦ Execute a purchase agreement.
♦ Execute the lender’s mortgage and related documents.
♦ Execute the HRA’s Mortgage and Promissory Note.
♦ Have the seller execute the HRA’s disclosure to seller form.
♦ Close on the property within the time frame specified.
♦ Execute other required forms within the time frame specified or required.
♦ Take occupancy of the dwelling within 30 days after Closing, homestead the property, and
continue to occupy the dwelling as your Principal Place of Residence.
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♦ Make principal, interest, property tax and insurance payments as required.
♦ Reimburse the HRA in accordance with the HRA’s Mortgage and Promissory Note should the
First Time Homebuyer trigger repayment through sale, moving, transfer of ownership, or
foreclosure within 30 years or default on any other terms of these documents.
Responsibilities of the Lender
The lender must:
♦ Verify the prospective homebuyer's income and assets to determine that the Family meets the
requirements of the Program and submit a copy of the verification to the HRA. These copies
must be submitted to the City at least five working days prior to the applicant signing a
purchase agreement.
♦ Compute the Mortgage, Down Payment, Mortgage payments and Closing Costs of Acceptable
Loans approved by the Program to determine the most cost-effective and appropriate form of
financing for the First Time Homebuyer to use.
♦ Provide a title search and review the documents.
♦ Provide the HRA with a pre-approval letter stating the maximum mortgage amount the
applicant is approved for.
♦ Provide the HRA other verification materials as requested by the HRA.
♦ Process a mortgage consistent with the Program.
♦ Meet all deadlines in a timely fashion, especially those that relate to the Closing. All
documents must be completed at least 10 days prior to the Closing and be delivered to the HRA
at least seven days before the Closing.
♦ Appraise property to determine the loan-to-value ratio.
Responsibilities of the HRA
The responsibilities of the HRA for the Program are to:
♦ Establish Program requirements and administer the Program.
♦ Send applicants the application form, the authorization for release of information form and
other certification and verification forms.
♦ Review the Application and other material for eligibility.
♦ Establish the pool of eligible participants and make selections for participation in accordance
with the selection provisions.
♦ Notify applicants when ineligible.
♦ Direct prospective buyers to register for the CAP-HC homebuyer workshops and provide
information and forms related to the Program.
♦ Provide liaison services involving the prospective buyer, lender and any real estate agent that
might be involved in the transaction.
♦ Review appraisal, purchase agreement, eligibility and mortgage for consistency with the
Program requirements.
♦ Prepare and execute the HRA mortgage and promissory note.
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♦ Provide financial assistance according to Program guidelines to the applicant at the time of
Closing.
♦ Service the HRA mortgage.
♦ Modify or terminate the Program as may be appropriate or required.
Application to the HRA
It is the responsibility of each applicant to assure that the HRA receives his or her application.
Only applications with original signatures will be accepted. At the time of application, applicants
must provide the HRA with the following information and meet the eligibility requirements:
♦ Names of all Family and household members
♦ Address and telephone number
♦ Social Security numbers of all adults
♦ Date of birth of all Family members
♦ Number of adults in Family
♦ Number of children in Family
♦ Total Gross Annual income from all sources (i.e. employment, social security income, child
support, etc.) with pay stubs and three years of tax returns as documentation
♦ Bank statements, financial statements and all other document(s) that verify Gross Assets.
♦ Employer's name (Company Name)
♦ Address and phone number of each employer
♦ Length of time (in years and months) at present address
♦ Last three previous addresses
♦ Indication if applicant ever owned a home
Summary of the Application Process
The following is a summary of the application process.
♦ The applicant registers for and attends the homebuyer workshop series through Community
Action Partnership of Hennepin County (CAP-HC).
♦ The applicant arranges for and attends a private housing counseling session with Community
Action Partnership of Hennepin County (CAP-HC).
♦ The applicant selects a participating lender and applies for mortgage pre-approval.
♦ The applicant completes and submits a First Time Homebuyer application and authorization
for release of information form to the HRA with a mortgage pre-approval letter from the lender.
♦ The applicant searches for a home in Plymouth.
♦ The applicant enters into a Purchase Agreement and contacts the lender.
♦ The lender authorizes appraisal of home.
♦ The lender confirms applicant’s mortgage eligibility and approves purchase.
♦ The lender contacts the HRA with supporting documentation.
♦ The HRA arranges for a lead-based paint hazard inspection of the property, if the dwelling was
built prior to 1978.
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♦ The HRA reviews appraisal, Purchase Agreement, Good Faith Estimate, and eligibility
verification for consistency with program goals and requirements.
♦ The HRA issues an approval letter.
♦ The HRA prepares the closing documents required by the City’s Program Guidelines.
♦ The HRA attends the Closing. At the Closing, the HRA has the borrower sign the required
closing documents and financial assistance is provided in the form of a second mortgage.
Eligibility Requirements
To be eligible to participate in the Program, the applicant must meet the following requirements at
the time of application and throughout the process up until Closing.
♦ Must qualify as a Family, as defined in Appendix A.
♦ Must be a U.S. citizen or have legal immigration status.
♦ Must be a First Time Homebuyer, as defined in Appendix A.
♦ Must not have a Gross Annual Income that exceeds the maximum income limits which are
revised annually to reflect the current year’s CDBG maximum income limits.
♦ Must not have Gross Assets exceeding $25,000.00, which excludes one automobile per adult
permanently residing in the home.
♦ Borrowers are required to invest at least $1,000.00 of their own monies towards the purchase
price of the home. Funds from public program(s) cannot be used as part of the Homebuyers
minimum portion of the down payment.
♦ Must meet the requirements of a Lender and qualify for a first mortgage.
♦ Must fulfill the Program obligations in a timely manner and must remain eligible to participate
based on the program requirements and those of the lender through the time of Closing.
♦ Must not have a previous loan through the Plymouth HRA that ended in foreclosure or any
other loan that ended in foreclosure within the previous five years.
♦ Must meet the requirements as specified elsewhere in these Guidelines.
Denial of Eligibility
The HRA will review and verify all applications for eligibility. Those applicants not meeting the
eligibility requirements will be sent a written notice explaining the reason(s) for denial of Program
participation.
Appeals regarding interpretation of eligibility requirements may be made in writing to the Housing
Program Manager, HRA’s Executive Director and then to the HRA Board of Commissioners.
Appeals that clearly do not meet eligibility requirements will not be considered.
Eligible Dwellings
To be eligible the property must meet the following requirements:
♦ Be located within the City of Plymouth.
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♦ Be a single-family dwelling, a townhouse unit, or a condominium unit.
♦ Be a conforming use as defined by the Plymouth Zoning Ordinance.
♦ Be free of lead-based paint hazards at the time of Closing.
The HRA may require an inspection of the dwelling for compliance with the Plymouth Housing
Code (Uniform Housing Code). The HRA will require an inspection of all dwellings built prior to
1978 for compliance with HUD’s lead-based paint hazard regulations. If lead-based paint hazards
are found, lead clearance will be required prior to Closing.
Applicant Outreach
The HRA will publicize and disseminate information to make known the availability of
homeownership assistance on a regular basis through a variety of media and by other suitable
means. The availability of assistance will be communicated to other service providers and Realtors
in the community and advise them of the guidelines so that they can make proper referrals for the
Program. Realtors will be encouraged to provide additional services to eligible clients to ensure
their successful utilization of the program.
Applicant Pool
The applicant pool for the Program shall consist of all those who have completed and returned to
the HRA a complete application, written verification from their lender of pre-approval, and who
are determined by the HRA to be eligible.
Selection from the Applicant Pool
As funds are available, applicants will be selected from the applicant pool on a first come, first
serve basis. Eligible applicants will be selected for funding when they or their lender notify the
HRA of the applicant’s approved purchase agreement and mortgage. If funding is limited and
more than one applicant is at the purchasing stage, the HRA will provide funding to the applicant
who qualifies for the most preference points.
Preference points have been established to meet the goals of the HRA. Each preference category
is worth one (1) point. The maximum points any one Family could receive are five (5) points.
Families with the highest point totals will be selected first. In the event of a tie, a drawing or
lottery will be held to rank the applicants within each of the preference categories.
♦ Applicant with dependents under age 18
♦ Live in Plymouth at least 90 days prior to Closing
♦ Head or co-head has primary, long-term employment in Plymouth
♦ Currently holding a Plymouth Section 8 Voucher
♦ Never owned a home (versus having owned a home over three years ago)
Selection from the applicant pool is tentative and conditional. Families selected for participation
must fulfill the Program obligations in a timely manner and must remain eligible to participate
based on the program requirements and those of the lender through the time of Closing.
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Lender Outreach
The HRA will solicit lender participation as needed. The HRA will review requests from lenders
to be approved as a participating lender of the First Time Homebuyer Program. The lenders must
be FHA and MHFA approved and exhibit a willingness to provide mortgage products to low- and
moderate-income Households.
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PART III: PROGRAM RULES
Lenders
All lenders must be a Minnesota Mortgage Program Lender as approved by Minnesota Housing.
Applicants should check the Minnesota Housing website at www.mnhousing.gov to determine
whether a lender is approved to participate in the Plymouth FTHB program Lenders and their
representatives must also be willing to participate in the Plymouth First Time Homebuyer
Program. Applicants should ask the lender if they have received the City of Plymouth’s Program
Guidelines and if they are familiar with the process.
It is the applicant’s responsibility to make arrangements for obtaining pre-qualification(s) or pre-
indication of approval and for making an application for a mortgage. A letter from the lender
indicating the amount of the mortgage for which the applicant pre-qualifies must be provided with
each application. The same lender must be used when the applicant goes for pre-approval of a
mortgage prior to the purchase of a home, so it is recommended that the applicant selects the lender
carefully.
Declarations of Restrictive Covenants
From time to time, declarations of restrictive covenants may be placed on properties as a condition
of First Time Homebuyer assistance. Declarations of restrictive covenants are placed on select
properties to ensure that these properties are owned by low- and moderate-income households in
the future, even after subsequent sales. Declarations of restrictive covenants may also restrict the
resale price of select housing units in an attempt to keep the units affordable.
Lead Based Paint Hazard Requirements
♦ All applicants purchasing a dwelling built prior to 1978 will be provided with a lead based
paint brochure and must sign a certification of receipt of the brochure.
♦ As a condition of funding, the applicant will be required to purchase a home free of Lead Based
Paint (LBP) hazards If the dwelling was built prior to 1978 a visual assessment for
deteriorated paint will be done by City staff. Applicants will be informed that the inspection
is only to determine the presence of deteriorated paint and they may also want to obtain a
complete Home Inspection from a certified Home Inspector.
♦ If deteriorated paint is found the HRA will contract with a certified Risk Assessor to perform
the necessary tests to determine if there is a lead hazard risk. A copy of a clean Lead Risk
Assessment report must be submitted to the HRA before the home is approved for assistance.
If the applicant refuses, the property will not be eligible for assistance. The applicant will need
to find another house that is or will be made LBP risk free in order to qualify for assistance.
♦ If LBP risks are found, stabilization of the defective paint, cleanup and clearance will be
required before funds are approved for assistance. The presence of LBP risks should be treated
like any other defect found during an inspection and may be negotiated between buyer and
seller. Clearance will be required before the home can be safely occupied and will assure that
there are no remaining lead hazards.
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Repayment of Assistance
Repayment of the deferred payment loan shall occur upon the earliest of:
♦ Sale, transfer or thirty years from the initial purchase date, when the HRA Mortgage becomes
due and payable.
♦ The property ceases for any reason to be the homebuyer's principal place of residence.
♦ Default on the mortgage with the HRA or any superior mortgage on the property.
At the time of repayment, the HRA will prepare and execute a Satisfaction of Mortgage. The
Satisfaction of Mortgage will be sent to the Title Company, who will be responsible for recording
the Satisfaction with the County. The HRA will send the homeowner a copy of the Satisfaction
as well as the original Promissory Note indicating it has been satisfied.
Loan Modification
Generally, the HRA will require that all First Time Homebuyer loans be repaid. However, the
HRA may modify loan agreements and/or waive repayment if the homeowner can document a
hardship. Hardship may include the homeowner not having the resources to pay the HRA’s loan
back (requires a denial letter from one or more financial institutions) or the property value
declining since the HRA’s loan was taken out. In addition, the HRA may consider forgiving a
portion or the entire loan amount if the homeowner is facing foreclosure and if forgiving the loan,
or a portion thereof, will assist the homeowner in restructuring their mortgage so they can remain
in the home.
The HRA will not consider forgiveness of the loan for the reasons stated above if the homeowner’s
reason for selling is to purchase a larger home unless there is severe overcrowding in the home.
Severe overcrowding means that there are more than two persons per sleeping room in the home.
A living room is considered a sleeping room for this purpose.
Hardship requests shall be made in writing to the Housing Program Manager and will be reviewed
on a case-by-case basis. If the Housing Program Manager denies a hardship request, appeals
regarding interpretation of the hardship provisions may be made in writing to the HRA’s Executive
Director and then to the HRA Board of Commissioners, which has the final say in the request.
Appeals that clearly do not meet the hardship requirements will not be considered.
Subordination of Mortgages
The HRA may subordinate the First Time Homebuyer Program loan. The HRA will review and
respond to all requests for subordinations within two weeks of the application date. The following
information must be submitted before a request for subordination will be considered.
♦ Effective date of current first mortgage, current first mortgage balance, interest rate and term
♦ Proposed loan amount, interest rate and term.
♦ Reasons for new financing and use of proceeds by amount. If financing will be used for home
improvements, specific information on the proposed home improvements must be provided.
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♦ Good Faith Estimate.
♦ Copy of appraisal.
♦ Most recent assessor’s market value of property.
♦ Types and amounts of any other indebtedness on property, including balance, rate and term.
♦ Date the First Time Homebuyer loan was filed with County and the document number.
♦ Household’s verified income and size.
♦ Full name, address, telephone number, contact person and e-mail address of the new lender.
♦ Date subordination agreement is needed (must be at least two weeks from the date of the
request).
Information provided will be analyzed to determine the appropriateness of subordination of the
HRA’s mortgage. The following criteria must be met before subordination of the loan will be
considered.
♦ All current and proposed property liens, including the First Time Homebuyer loan, equal
less than 95 percent of the appraised value of the property.
♦ The subordination is necessary to refinance the principle balance of existing prior liens on
the property and will facilitate a rate reduction, term reduction and/or principal reduction
plus any costs to finance additional eligible home improvements. No cash may be taken
out as a result of refinancing. However, the fees incurred to refinance will be an allowable
expense.
♦ All home improvements must be eligible under the Home Rehabilitation guidelines and the
homeowner is required to submit documentation of cost for all improvements as a condition
of the subordination.
♦ The uses for the new financing must be justifiable as an appropriate use of public funds to
warrant subordination of the public funding.
♦ The HRA Executive Director may allow cash out to the borrower due to a situation of
financial hardship, which may include unexpected medical bills, divorce, or loss of job
within six months of applying for subordination.
♦ The borrower(s) must correct any errors and omissions relating to their loan as a condition
of the HRA granting a subordination request. This requirement would include but not be
limited to documents that are not signed (but the intent was to have them signed),
documents with clerical errors and/or documents that are missing or destroyed.
If the above criteria are not met, the HRA will not subordinate its mortgage. The client will then
need to either obtain financing that is subordinate to the HRA’s mortgage, pay off the HRA’s loan
as a condition of the new financing, obtain non-mortgage financing, or forgo the additional
financing.
Appeals regarding interpretation of this Subordination Policy may be made in writing to the HRA’s
Executive Director and then to the HRA Board of Commissioners. Appeals that clearly do not
meet the subordination requirements will not be considered.
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Targeted Funding
At various times, the HRA may target Program funding for purchases in specific developments.
Applicants purchasing in those developments would receive Program funding prior to all other
applicants.
Total Amount of Assistance
The total amount of assistance received through the Plymouth HRA for all HRA programs
including the Housing Rehabilitation, First Time Homebuyer, and Emergency Repair Grant
Programs cannot exceed $60,000.00. This limit may be waived on a case-by-case basis at the
discretion of the HRA Executive Director.
Modification and Termination of Program
The HRA may modify or terminate the Program as it deems appropriate or as required by HUD.
Once the HRA has provided financial assistance and the mortgage executed, financial assistance
shall not be rescinded except as provided for in the executed HRA mortgage and promissory note.
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APPENDIX A
DEFINITIONS
Acceptable Loans – Conventional, Fannie Mae, FHA, VA and ARM’s that at a minimum are at
a fixed rated for the first seven years.
Applicant – An individual or household submitting an application for a loan.
Application – The form used to request assistance for the City of Plymouth’s First Time
Homebuyer funds.
ARM – An Adjustable Rate Mortgage is a mortgage that offers an initial rate that is fixed for a
certain number of years of repayment; the rate then adjusts every year thereafter for the
remaining life of the loan.
CAP-HC – Community Action Partnership of Hennepin County. An agency working in all of
Hennepin County to assist low-income people with services to individuals through outreach,
energy assistance programs, homeownership services and financial counseling.
CDBG – A Community Development Block Grant Program; which is an annual entitlement
program provided to the City of Plymouth through the U.S. Department of Housing and Urban
Development (HUD).
City – The City of Plymouth.
Clearance – A Lead Based Paint Certification that all lead issues have been remediated.
Closing - The consummation of the real estate transaction. The Closing includes the delivery of a
deed, financial adjustments, the signing of notes, mortgages, and the disbursement of funds
necessary to complete the sale and loan transaction.
Closing Costs - Those costs required by the lender to be paid by the buyer for various fees, credit
report cost, insurance, etc. at time of Closing on property.
Consolidated and Annual Action Plans – HUD requires the City of Plymouth to submit a 5 year
Consolidated Plan and an Annual Action Plan to guide housing, homelessness and Community
Development activities.
Conventional Mortgage – A type of residential mortgage loan, usually from a bank or savings
and loan association, with a fixed rate and term. It is repayable in fixed monthly payments over a
period usually 30 – 40 years or less, secured by real property, and not insured by the Federal
Housing Administration or guaranteed by the Veterans Administration.
Down Payment – A type of payment made by a home buyer, indicating intention to purchase real
estate offered for sale and obtain financing from a bank or mortgage company.
DTI - Debt to Income Ratio – Indicates the percentage of income that goes toward housing costs,
including mortgage principal and interest, mortgage insurance premium, hazard insurance
premium, property taxes, and homeowners association dues (when applicable).
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Family – A group of individuals who live or will live under one roof.
Fannie Mae – A privately owned and operated corporation that buys mortgages from such lenders
as banks and savings and loans, packages them, and resells them on the open market.
FHA – Federal Housing Administration. A Federal agency that administers many loan programs,
loan Guarantee programs, and Loan Insurance programs designed to make more housing available.
First Time Homebuyer - A Family who has not owned a dwelling of any kind within the
preceding three years from the date of application or who has been displaced due to a divorce
situation. (A Family purchasing a dwelling with a Contract for Deed is not eligible to participate
in this Program.)
Good Faith Estimate – Document disclosing the approximate closing costs a mortgage applicant
will pay at or before the mortgage settlement date.
Gross Annual Income - The Gross Annual Income of a Household for the purposes of this
program is as defined for purposes of reporting under Internal Revenue Service Form 1040 for
individual Federal annual income tax purposes as per 24 CFR 570.3 and 26 CFR.
Gross Assets - The current market value of the following minus existing indebtedness: (Typically,
it does not include 401K funds, pensions, or other deferred compensation funds.)
1. Cash on hand
2. Cash in checking accounts
3. Cash in savings accounts, including accounts held in trust.
4. The cash value of life insurance policies.
5. Investment securities (government bonds, municipal bonds)
6. Stocks
7. Certificate of deposits and annuities
8. The current market value of all interest in real estate. Included in this determination is
any land in which any resident of the Household holds title or is selling on contract for
deed. The value of the contract for deed property shall be defined as 100 percent of the
outstanding balance on the contract at a time twelve months following the date of the
income and other asset verifications. The dollar amount of the difference between the
outstanding balance at the time of verifications and the outstanding balance twelve
months later shall be included as household income.
9. All other property, exclusive of household furnishings, clothing, and one vehicle. This
section includes, but is not limited to business equipment, boats, snowmobiles,
motorcycles, farm stock and additional vehicles.
10. If the applicant owns a business, in full or in part, and that business is incorporated, then
the business equipment is not an asset. If the business is not incorporated, the business
equipment is then considered a personal asset. The value of the ownership of the
business by the applicant is a personal asset. If the applicant owns less than 100 percent
of the business, written notarized proof of the percent of ownership must be provided by
the applicant to the HRA.
Guidelines - The set of standards, criteria, and specifications to be used in administering the
Program.
Household – All persons residing in one housing unit; which may include one or more families, a
single person, a married couple, or two or more unrelated persons.
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Housing Counselor – A person who provides direct customer service primarily to groups,
individuals, households seeking information and assistance with housing issues.
HRA - The Housing and Redevelopment Authority in and for the City of Plymouth, Minnesota;
which administers Plymouth’s First Time Homebuyer Program.
HUD – U.S. Department of Housing and Urban Development. The principal federal agency
responsible for implementing certain federal housing and community development programs.
Income – The amount of money or its equivalent received during a period of time in exchange for
labor or services, from the sale of goods or property, or as profit from financial investments.
Lead Risk Assessment – A report that describes the health-risk assessment, management process,
estimates of the costs of recovery, and summaries of possible defensive measures required per
HUD regulation CFR Part 35: Lead Based Paint Regulations.
Lender - Individual or firm that extends money to a borrower with the expectation of being repaid,
usually with interest.
Low Income Family – A Family whose annual income does not exceed the low-income limit as
established by HUD with adjustments for smaller and larger families.
MFHA – The Minnesota Housing Finance Agency; a Minnesota State agency that administers a
variety of first time home buyer loan programs.
Moderate Income Family - A Family whose annual income does not exceed 80 percent of the
median income for the area, as determine by HUD with adjustments for smaller and larger families.
Mortgage - The conveyance of an interest in real property given as security for the payment of a
loan.
Principal Place of Residence – To occupy the home as the primary residence on a permanent
basis.
Program - The HRA's First Time Homebuyer Program.
Promissory Note - A written instrument containing a promise by the signer to pay an agreed
amount.
Purchase Agreement - An agreement between buyer and seller of real property, setting forth the
price and terms of the sale. Also known as a sales contract.
Reducing the Mortgage Principal Amount - A method of benefiting the buyer through the use
of a portion or all of the HRA provided financial assistance to lower the mortgage principal
amount. In effect, this assistance acts as a larger down payment and, helps to reduce the monthly
mortgage payments. The available amount of assistance is up to 20% of the purchase price to a
maximum of $30,000. Borrowers are expected to contribute at least 25% of their gross qualifying
income toward their monthly payment before Plymouth financial assistance can be used for
reduction of the mortgage principal.
Satisfaction of Mortgage – A document releasing a Mortgage lien, indicating the borrower has
paid the debt in full.
Second Mortgage - A loan on a property that already has an existing mortgage (the first
mortgage). The second mortgage is subordinate to the first.
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VA Loan – Department of Veterans Affairs, providing below-market financing with no down
payment to veterans of the U.S. Armed Services.
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