03-16-2020 EDA Complete AgendaE C O N O MIC D E V E L O P ME N T AU T H O R IT Y ME E TIN G
R IC H F IE L D MU N IC IPAL C EN TER, C O U N C IL C H AMB E R S
MAR C H 16, 2020
7:15 P M (I MMEDI AT ELY FO L L OWI NG THE H R A M EE T I N G)
C all to Order
Open F orum
Approval of the Minutes
A pproval of the mi nutes of the regular E conomic D evelopment A uthority of J anuary 21, 2020.
AG E N D A AP P R O VAL
1.Consent C alendar contains several separate items which are acted upon by the ED A in one motion.
Once the Consent Calendar has been approved, the individual items and recommended actions have
also been approved. No further E D A action on these items is necessary. H owever, any E D A
Commissioner may request that an item be removed from the Consent Calendar and placed on the
regular agenda for E D A discussion and action. All items listed on the C onsent C alendar are
recommended for approval.
A .C onsi deration of an amendment to the guidelines for the K ids @ Home P rogram to allow an increase in
allowable income up to 60% of the A rea Median Income.
S taff Report No. 9
2.C onsideration of items, if any, removed from C onsent C alendar
O T H E R B U SIN E S S
3.D iscussi on of the creation of a D isplaced B usi ness Grant.
S taff Report No. 10
E D A D IS C U S S IO N ITE MS
E X E C U T IV E D IR EC TO R R E P O R T
C L AIMS
4.A djournment
Auxiliary aids for individuals with disabilities are available upon request. R equests must be made at least 96
hours in advance to the C ity Clerk at 612-861-9738.
ECONOMIC DEVELOPMENT
AUTHORITY MEETING MINUTES
Richfield, Minnesota
Regular Meeting
January 21, 2020
CALL TO ORDER
The meeting was called to order by President Supple at 7:41 p.m. in the Council Chambers.
EDA Members Mary Supple, President; Maria Regan Gonzalez; Sue Sandahl; and Erin
Vrieze Daniels.
EDA Members Absent Pat Elliott
Staff Present: John Stark, Executive Director; Julie Urban, Housing Manager; and LaTonia
DuBois, Administrative Assistant.
CONSIDERATION OF THE ELECTION OF OFFICERS FOR THE RICHFIELD ECONOMIC
DEVELOPMENT AUTHORITY FOR 2020 (S.R. NO.1)
President Supple opened nominations.
M/Vrieze Daniels to elect the slate of officers as follows:
Mary Supple to serve as President,
Pat Elliott to serve as Vice President,
Sue Sandahl to serve as Treasurer,
LaTonia DuBois to serve as Secretary,
Chris Regis to serve as Assistant Treasurer.
Motion carried 4-0
APPROVAL OF THE MINUTES OF THE REGULAR ECONOMIC DEVELOPMENT AUTHORITY
MEETING OF NOVEMBER 18, 2019
M/ Regan Gonzalez, S/Sandahl to approve the minutes of the regular Economic
Development Authority meeting of November 18, 2019.
Motion carried 4-0
EDA Meeting Minutes -2- January 21, 2020
Item #1
APPROVAL OF THE AGENDA
M/Sandahl, S/Regan Gonzalez, to approve the agenda.
Motion carried 4-0
Item #2
CONSIDERATION OF THE CONSENT CALENDAR
Executive Director Stark presented the Consent Calendar:
A. Consideration of the adoption of a resolution amending the Bylaws of the Richfield
Economic Development Authority to revise the “Order of Business”, including the
addition of an “Open Forum.” (S.R. No. 2)
RESOLUTION NO. 16
RESOLUTION AMENDING THE BYLAWS OF THE ECONOMNIC
DEVELOPMENT AUTHORITY OF THE CITY OF RICHFIELD,
MINNESOTA
B. Consideration of resolutions designating official depositories for the EDA for 2020,
including the approval of collateral. (S.R. No. 3)
RESOLUTION NO. 17
RESOLUTION DESIGNATING CERTAIN FINANCIAL INSTITUTIONS
AS DEPOSITORIES FOR THE INVESTMENTS OF ECONOMIC
DEVELOPMENT AUTHORITY OF RICHFIELD FUNDS IN 2020
RESOLUTION NO. 18
RESOLUTION DESIGNATING CERTAIN SAVING AND LOAN
ASSOCIATIONS, BANKS AND CREDIT UNIONS AS DEPOSITORIES
FOR THE INVESTMENT OF ECONOMIC DEVELOPMENT
AUTHORITY OF RICHFIELD FUNDS IN 2020
RESOLUTION NO. 19
RESOLUTION DESIGNATING U.S. BANK A DEPOSITORY OF
FUNDS OF THE EDA OF RICHFIELD FOR THE YEAR 2020
C. An amendment to the guidelines for the Kids@Home program. (S.R. No.
4)
D. Designation of Community Development Director Johns Stark as the
Executive Director of the EDA. (S.R. No. 5)
M/Sandahl, S/Regan Gonzalez to approve the Consent Calendar.
Commissioner Vrieze Daniels asked for clarification of a requirement in the Kids@Home
program guidelines and recommended updating the wording to which Executive Director Stark and
Housing Manager appreciated.
Motion carried 4-0
President Supple invited people to speak at the open forum.
EDA Meeting Minutes -3- January 21, 2020
Item #3
CONSIDERATION OF ITEMS, IF ANY, REMOVED FROM CONSENT CALENDAR
None.
Item #4
AUTHORIZE EDA EXECUTIVE DIRECTOR TO APPROVE EXPENDITURES AND
APPROVE AND EXECUTE PROFESSIONAL SERVICE AGREEMENTS IN AN
AMOUNT UP TO $50,000 (S.R. NO. 6)
Executive Director Stark presented Staff Report 6.
M/Sandahl, S/Vrieze Daniels to approve a resolution authorizing Economic Development
Authority Executive Director to approve expenditures and approve and execute professional
service agreements/contracts in an amount up to $50,000.
Motion carried 4-0
RESOLUTION NO. 20
RESOLUTION DELEGATING EXECUTIVE DIRECTOR TO EXECUTE CERTAIN
DOCUMENTS AND AUTHORIZE EXPENDITURES ON BEHALF OF THE RICHFIELD
ECONOMIC DEVELOPMENT AUTHORITY
Item #5
CONSIDER THE CREATION OF AN ENERGY EFFICIENT BUSINESS GRANT (S.R.
NO. 7)
Executive Director Stark presented Staff Report 7, and explained the CEE would administer
the program at no cost to the EDA.
M/Sandahl, S/Regan Gonzalez to approve a Memorandum of Understanding with the
Center for Energy and Environment for the use of $21,000 of Economic Development Authority
funds for the implementation of an Energy Efficient Business Grant.
Motion Carried 4-0
Item #6
CONSIDER THE CREATION OF A SMALL BUSINESS REVOLVING LOAN FUND
PROGRAM FOR RICHFIELD BUSINESSES (S.R. NO. 8)
Executive Director Stark presented Staff Report 8, and explained some portions of the
contract are not currently available.
Commissioner Vrieze Daniels spoke positively about the loan program but mentioned
concern with the higher interest rate and equitability. Executive Director Stark explained this is
consistent with the way MCCD operates these loans in all communities and explained their
reasoning is to dissuade larger companies from applying for this program and to keep it available
for business that may not be able to resort to traditional lending.
M/Sandahl, S/Regan Gonzalez to approve the use of $61,250 of Economic Development
Authority funds for the implementation of a Small Business Revolving Loan Fund Program, and;
approve a contract with the Metropolitan Consortium of Community Developers for the
administration of a Small Business Revolving Loan Fund Program for Richfield businesses and
that staff report back to the EDA the missing exhibits of the contract.
Motion Carried 4-0
EDA Meeting Minutes -4- January 21, 2020
Item #5
EDA DISCUSSION ITEMS
President Supple mentioned there will be further discussion at a later date regarding a
previously discussed relocation loan.
Item #6
EXECUTIVE DIRECTOR REPORT
Executive Director Stark notified the EDA of his upcoming absence at the February HRA
and EDA meetings.
Item #7
CLAIMS
M/Regan Gonzalez, S/Vrieze Daniels that the following claims and payroll be approved:
U.S. BANK 12/16/2019
EDA Checks: 20297-20311 $8,759.67
TOTAL $8,759.67
U.S. BANK 1/20/2020
EDA Checks: 20312-20327 $35,471.00
TOTAL $35,471.00
Motion carried 4-0
Item #8
ADJOURNMENT
The meeting was adjourned by unanimous consent at 7:59 p.m.
Date Approved: March 16, 2019
Mary B. Supple
President
LaTonia DuBois John Stark
Administrative Assistant Executive Director
AGENDA SECTION:Consent Calendar
AGENDA ITEM #1.A.
STAFF RE P ORT NO. 9
E CONOMIC DEVELOPME NT AUT HORIT Y
ME E T ING
3/16/2020
RE P O RT P RE PA RE D B Y: J ulie Urban, Housi ng Manager and Lynnette C hambers, Multi-F amily Housing
P rogram C oordi nator
O TH E R D E PA RTM E NT
RE V IE W:
E X E C U TIV E D IRE C TO R
RE V IE W: Melissa P oehlman, A sst. C D D irector
3/10/2020
I T E M F O R C O UNC I L C O NS I D E RAT IO N:
Consideration of an amendment to the guidelines for the Kids @ Home Pr ogram to allow an increase
in allowable income up to 60% of the Area Median Income.
E X E C UT IV E S UM M ARY:
The Kids @ Home P rogram (Program) is a shallow rent subsidy program designed to help families with
children in Richfield sc hools attain a stable housing situation, as studies show this is a key factor in
educ ational succ ess. The Program is now celebrating its fifteenth year of serving the community. To date,
over 150 families have benefited from the Program.
To be eligible for the Program, a member of the family must be working a minimum of 30 hours a week and
have an annual inc ome at or below 50% of the A rea Median I nc ome (A MI ). Staff is recommending that
that maximum allowable income be raised to 60% of the AMI, given rising rents and the additional
income needed to raise a family in the metro area. In addition, it has always been a goal of the
Program to encourage families to improve their financial situation and not penalize families for
working to support themselves.
Recently, several applicants for the Program have had incomes just over 50% of the AMI, generally
because they receive supplemental income to their earned income, which in most cases is Social
Security or child support. Increasing the annual income to 60% of AMI would allow the Program to
serve these families and still meet our goals.
Under the proposed change to the guidelines, we would not serve higher income families at a cost
to our lower income families. Applications would be reviewed and qualified candidates would be
prioritized in order of income. If we had enough qualified families at or below 50% of AMI to fill our
open spots on the Program we would only serve those families. If we had additional open spots in
our Program then we would look at families whose income falls between 50% and 60% of AMI.
RE C O M M E ND E D AC T IO N:
By Motion: Amend the guidelines of the Kids @ Home Program to allow a maximum annual family
income up to 60% of the Area Median Income, with priority given to families earning less than 50% of
the Area Median Income.
B AS IS O F RE C O M M E ND AT IO N:
A.H IS TOR IC AL C ON TEXT
Due to the rising costs of rental units, it is estimated by Out of Reach Minnesota 2019
that in the Metro area the housing wage must be $22.13 per hour ($46,040 annual
income) to afford a modest two bedroom apartment. Under the current income guidelines
for the Program a family size or 2 or 3 people would be considered over income with an
annual income of $46,040.
Applic ants for the Program whose inc ome falls between 50% of A MI and 60% of A MI generally
have supplemental inc ome to their earned inc ome, in most cases Social Sec urity or c hild support,
thus their housing wage does not normally reac h the $22.13 per hour level.
B.P OL IC IE S (resolutions, ordinances, regulations, statutes, etc):
The Program guidelines currently require families to earn no more than 50% of the Area Median
I nc ome, adjusted for family size:
Persons Income Limit Persons Income Limit
2 $40,000 6 $58,000
3 $45,000 7 $62,000
4 $50,000 8 $66,000
5 $54,000
The proposed guidelines would allow families to earn up to 60% of the A rea Median I nc ome:
Persons Income Limit Persons Income Limit
2 $48,000 6 $69,600
3 $54,000 7 $74,400
4 $60,000 8 $79,200
5 $64,800
As of 4/24/2019
Family inc ome is reviewed annually in order to confirm continued need and eligibility ; however, in
years 2-4 of the Program, only 85% of a family's total income is c onsidered in order to determine
if they are eligible to remain on the P rogram. This adjustment is made to enc ourage families to
work to increase their inc ome without penalizing them and impact housing stability.
C.C R IT IC AL T IMIN G ISSU E S:
I f approved, the amended guidelines would apply immediately.
D.F IN AN C IAL IMPAC T:
N/A
E.L E GAL C ON S ID E R AT ION :
The Program is funded solely by the Ric hfield Economic Development A uthority (E D A) and
eligibility guidelines are at the E D A's discretion.
ALT E R N AT IV E R E C O MME N D AT IO N(S):
Do not amend the guidelines.
Continue the item to seek further information or clarification.
P R IN C IPAL PAR TIE S EXP E C T E D AT ME E T IN G:
None
AT TAC H ME N TS :
D escripti on Type
K ids @ Home P roposed Guidelines B ackup Materi al
Kids @ Home – Rental Assistance Program
Kids @ Home is a 48 month rent assistance program. Families must fit the criteria to enter the program and maintain this
criterion to continue to receive rental assistance under the program.
Criteria for families:
♦ must currently be housed in unsubsidized rental housing in Richfield (no shared housing)
♦ have a child or children in Richfield schools (K – 12)
♦ child or children need to be enrolled and attend a Richfield school
♦ one parent (or adult in family) is employed for a minimum of 30 hours a week (pay checks stubs for 2 months
of work needed to provided verification of this income)
♦ not receiving any other housing assistance
♦ annual income must fall at or below income guidelines, with priority given to households earning at or below
50% of the Area Median Income
♦ rental payments must be current or no more than one month’s total rent owed to landlord
♦ Families must be willing to attend 10 Parent Share meetings a year (Parent Share meetings are held Thursday
evenings from 6:00 p.m. to 8:00 p.m. at Hope Presbyterian Church in Richfield. Families must attend 5 of the
Parent Share meetings by June 30th of each year and the remaining 5 must be completed by December 15th of
each year)
Maximum Income Limits Effective 04/24/2019
60% of Area Median Income
Persons Income Limit Persons Income Limit
2 $48,000 6 $69,600
3 $54,000 7 $74,400
4 $60,000 8 $79,200
5 $64,800
Priority Income Limits Effective 04/24/2019
50% of Area Median Income
Persons Income Limit Persons Income Limit
2 $40,000 6 $58,000
3 $45,000 7 $62,000
4 $50,000 8 $66,000
5 $54,000
Occupancy Standards – Family Size determines the
Occupancy Size (bedroom size for your family) and the bedroom
size determines your rent assistance. You may live in a unit that
is larger than the Occupancy Size determined by Richfield HRA,
rent assistance in that case will be determined by actual family
size. If your family lives in a unit smaller than the occupancy
standard the assistance determined by Richfield HRA is the
bedroom size of the unit.
Number of Persons
Bedroom Size
2 - 4 2
5 -7 3
8 -10 4/5
Rent Assistance (effective 9/1/2019) – Families receive rent assistance based on the following flat payment. Each year
rent assistance decreases, families’ responsibility will increase)
Bedroom Size
1st Year
2nd Year
3rd Year
4th Year
One $450 $400 $350 $250
Two $550 $500 $450 $350
Three $650 $550 $500 $450
Four/Five $750 $700 $650 $550
The Kids @ Home Program will open in February 2020 for applications. Interested individuals will need to download an
application from the City of Richfield’s website (www.cityofrichfield.gov). There will be a link on the first page of the website
that will direct you to the application. The application will be available for download from 10:00 a.m. Tuesday February 4, 2020
through 4:00 p.m. Friday February 14, 2020. Complete the entire application and return it along with a copy of your current
lease and paystubs that reflect 6 – 8 weeks of payment (check stubs must be dated December 2019, January 2020 or February
2020). The application, current lease and appropriate paystubs must be submitted to Richfield HRA no later than 4:00 p.m. on
Monday February 24, 2020. (FAX AND E-MAILS WILL NOT BE ACCEPTED)
If there are more qualified candidates than openings available Richfield HRA will conduct a random lottery drawing.
Letters/E-mails for the qualified candidates who have been pulled for the lottery will be sent out no later than March 6, 2020.
Those applications not selected in the lottery draw will have their applications shredded. Applicants selected from the lottery
draw must complete the required process to become participants on the Kids @ Home Program as well as attend a scheduled
briefing in April or May of 2020. Rent assistance for qualified candidates who have successfully completed the application
process will begin June 1, 2020.
AGENDA SECTION:OTHER BUSINESS
AGENDA ITEM #3.
STAFF RE P ORT NO. 10
E CONOMIC DEVELOPME NT AUT HORIT Y
ME E T ING
3/16/2020
RE P O RT P RE PA RE D B Y: John S tark, E xecutive D irector
O TH E R D E PA RTM E NT RE V IE W:
E X E C U TIV E D IRE C TO R RE V IE W: Melissa P oehlman, A sst. C D D irector
3/10/2020
I T E M F O R C O UNC I L C O NS I D E RAT IO N:
Discussion of the creation of a Displaced B usiness Grant.
E X E C UT IV E S UM M ARY:
The Ric hfield Ec onomic Development Authority (E D A) has been budgeting funds for "Business Assistance"
programming sinc e its inception in 2018. Based on staff's recommendation, however, these funds have been
ac cumulating instead of being expended in order to c reate an adequate source of funding for programs.
At the October 21, 2019 ED A work session, staff proposed a number of programs recommended for
implementation in 2020. Among these was funding to be made available to businesses that are displac ed as a
result of redevelopment projects that receive funding from the City of Richfield, the Richfield Housing and
Redevelopment A uthority (HRA) or the Richfield E D A.
Sinc e that time, staff has worked with the E D A 's legal counsel on determining appropriate program
guidelines. Before presenting a final recommendation, however, staff would like to seek E D A Commissioners'
input on those guidelines and on determining funding limits that provide adequate assistanc e to displaced
businesses while still being sustainable with the E D A 's ability to fund such a program.
The proposed guidelines include:
Eligibility
Businesses must be required to move due to the approval of a redevelopment projec t that is receiving
funding from the Ric hfield HRA or E D A ;
Must be in plac e after a formal Development Agreement (not a Preliminary Development Agreement)
has been signed with HRA or E D A;
The Business cannot be eligible for Reloc ation Assistanc e under the Uniform Reloc ation and Real
Property Ac quisition Act (as that would provide alternate funding);
I n order to receive full funding, business must have been in place at least one y ear prior to signing of
Development Agreement;
The business must reloc ate within Richfield’s c orporate boundary;
The business must be open for business within six months of displacement from former location.
Funding
I nitial pay ment for 1 y ear of inc reased lease rate of up to $______;
Additional reimbursement for ac tual moving c osts, fixture installation and/or signage c osts of up to
$______;
Businesses in plac e for less than 1 year c ould receive 8.33% of the above payments for each month
they were open at the subjec t property prior to the exec ution of the Development Agreement.
The amounts of funding, whic h have been left blank above, should be analyzed on both an individual business
basis and a cumulative basis. As an example, there is c urrently a development proposal for the two buildings
comprising the address range of 6439-6467 Ly ndale Avenue and 404-408 W est 66th Street. Those buildings
currently house approximately 15 businesses (plus several vacant spots and non-business uses). I f the E D A
were to fund 15 D isplac ed Business Grants at a total of $2,500/business, that would be a c ost of $37,500.
Doubling the per business grant to $5,000 would result in a cost of $75,000 for this site. C urrently, the E D A
budget includes $95,000 annually for all Business A ssistance programs. The E D A approved both a Small
Business Revolving Loan Program and an Energy Effic ient Business Grant at its J anuary 2020 meeting. The
approved budgets for these programs was $61,250 and $21,000 respectively. Unless the budgets for those
programs were amended, this would leave only $12,750 in available annual funding for the Displaced
Business Grant. The E D A has $190,000 that was budgeted in 2018-19 and not utilized to provide additional
operating funds for programming.
Given the E D A 's annual funding capacity, additional operating funds and staff's predic tion that redevelopment
projects that displace businesses A ND do not trigger the Uniform Relocation Ac t (whic h would typically be
funded by a developer), the staff rec ommendation is to provide a maximum of $3,000 per displac ed business
($1,750 for lease differential and $1,250 for signage/fixtures). I n the c ase of the cited property, this could
range from $36-$45,000.
RE C O M M E ND E D AC T IO N:
Discuss proposed D isplaced Business Grant and provide staff with direction on funding limits to
submit to the E D A as part of a formal progr am consideration at its April or May meeting.
B AS IS O F RE C O M M E ND AT IO N:
A.H IS TOR IC AL C ON TEXT
The Richfield E D A was founded in J anuary 2018.
Since its inc eption the E D A has been budgeting funds for Business D evelopment ac tivities.
The E D A supported the c oncept of a Displaced Business Grant for Richfield businesses at its
October 21, 2019 work session.
B.P OL IC IE S (resolutions, ordinances, regulations, statutes, etc):
The proposed grant program is an appropriate activity for an E D A as defined in Minnesota State
Statutes.
C.C R IT IC AL T IMIN G ISSU E S:
N/A
D.F IN AN C IAL IMPAC T:
As proposed the D isplac ed Business Grant could cost up to $45,000 related to the ac quisition of a
building with 15 c ommercial tenants.
E.L E GAL C ON S ID E R AT ION :
J ulie Eddington, the E D A's legal counsel from K ennedy and Graven, has reviewed the proposed
program guidelines.
ALT E R N AT IV E R E C O MME N D AT IO N(S):
Provide staff with amended program guidelines or funding amounts to analy ze prior to formal E D A
c onsideration at a later date.
P R IN C IPAL PAR TIE S EXP E C T E D AT ME E T IN G:
N/A
AT TAC H ME N TS :
D escripti on Type
D isplaced B usi ness Grant B ackup Materi al
Eligibility
• Businesses must be required to move due to the approval of a redevelopment project that is
receiving funding from the Richfield HRA or EDA;
• Must be in place after a formal Development Agreement (not a Preliminary Development
Agreement) has been signed with HRA or EDA;
• The Business cannot be eligible for Relocation Assistance under the Uniform Relocation and Real
Property Acquisition Act (as that would provide alternate funding);
• In order to receive full funding, business must have been in place at least one year prior to
signing of Development Agreement;
• The business must relocate within Richfield’s corporate boundary;
• The business must be open for business within six months of displacement from former
location.
Funding
• Initial payment for 1 year of increased lease rate of up to $1,500;
• Additional reimbursement for actual moving costs, fixture installation and/or signage costs of up
to $1,000;
• Businesses in place for less than 1 year could receive 8.33% of the above payments for each
month they were open at the subject property prior to the execution of the Development
Agreement.
Displaced Business Grant