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CR 05-080-CDBG Agreement with Hennepin County OIlY OF m June 2, 2005 HOPKINS Council Rpt #2005-080 CDBG JOINT COOPERATION AGREEMENT WITH HENNEPIN COUNTY Proposed Action Staffrecommends approval of the following motion: Adopt resolution number 2005-054 authorizing execution of Joint Cooperation Agreement with Hennepin County relating to the Community Development Block Grant Program for Fiscal Years 2006-2008. With this motion, the Joint Cooperation Agreement will be executed and forwarded to Hennepin County. Overview For many years the City of Hopkins has participated in the Urban Hennepin County Community Development Block Grant (CDBG) program, which entitles the City to a yearly allocation of CDBG funds and the opportunity to compete for HOME funds. In order to participate in the Hennepin County CDBG and HOME programs, the City must execute a Joint Cooperation Agreement. This agreement would be in effect for fiscal years 2006 through 2008. Because entitlement funds are allocated based on population, the City of Hopkins could not qualify as an entitlement community without participation in the Urban Hennepin County program and would have to compete for CDBG funds on a statewide basis. Primarv Issues to Consider . What is the impact of this action on the City? . What are the major changes in the agreement? Supportinl! Documents Financial Impact: $ 0 Budgeted: Related Documents (CIP, ERP, etc.): Notes: Y/N Source: CDBG Joint Cooperation Agreement Council Rpt. 2005-080 Page 2 Primary Issues to Consider . What is the impact of this action on the City? Without the Joint Cooperation Agreement, the City of Hopkins would not be eligible for entitlement funds through the CDBG program. Rather, the City would have to compete for the funds through the state CDBG program with the likelihood of being funded very low. By participating in the Urban Hennepin County consortium through the execution of the Joint Cooperation Agreement the City of Hopkins automatically receives an allocation ofCDBG funds averaging approximately $120,000 per year. . What are the major changes in the agreement? The most significant change in the agreement involves how program income is administered. Program income is the money generated primarily through repayments ofloans and/or grants made under the housing rehabilitation program. Under the new agreement, program income will be incorporated into a pool to be accessed by all participating cities. Hennepin County representatives have indicated this change is necessary in order to assure the Department of Housing and Urban Development (HUD) that program income is spent on a timely basis and that this change was not negotiable. City staff will be promoting the use of the housing rehabilitation loan/grant program to assure that Hopkins residents have equal access to the program income dollars. Alternatives The City Council has the following alternatives regarding this issue: . Approve the action as recommended by staff. . Elect not to participate in the Urban Hennepin County CDBG prob'Tam during the next three years. CITY OF HOPKINS HENNEPIN COUNTY, MINNESOTA RESOLUTION NO. 2005-054 RESOLUTION AUTHORIZING THE EXECUTION OF A JOINT COOPERATION AGREEMENT BETWEEN THE CITY OF HOPKINS AND HENNEPIN COUNTY FOR PARTICIPATION IN THE URBAN HENNEPIN COUNTY COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM IN FY 2006 - 2008. WHEREAS, the City of Hopkins, Minnesota and the County of Hennepin have in effect a Joint Cooperation Agreement for purposes of qualifying as an Urban County under the United States Department of Housing and Urban Development Community Development Block Grant (CDBG) and HOME Investment Partnerships (HOME) Programs; and WHEREAS, the City and County wish to execute a new Joint Cooperation Agreement in order to continue to qualify as an Urban County for purposes of the Community Development Block Grant and HOME Programs. BE IT THEREFORE RESOLVED that a new Joint Cooperation Agreement between the City and County be executed effective October 1, 2005 and that the Mayor and the City Manager be authorized and directed to sign the Agreement on behalf of the City. Adopted this 7th day of June, 2005. Eugene J. Maxwell, Mayor Attest: Terry Obermaier, City Clerk Contract No. A050448 JOINT COOPERATION AGREEMENT URBAN HENNEPIN COUNTY COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM THIS AGREEMENT made and entered mto by and between the COUNTY OF HENNEPIN, State of Minnesota, heremafter referred to as "COUNTY," A-2400 Government Center, MinneapolIs, Minnesota, 55487, and the cities executmg this Master Agreement, each hereinafter respectively referred to as "COOPERATING UNIT," said parties to this Agreement each being governmental units of the State of Minnesota, and made pursuant to Minnesota Statutes, Section 471.59: WITNESSETH: COOPERATING UNIT and COUNTY agree that it is desirable and in the interests of their citizens that COOPERATING UNIT shares its authority to carry out essential community development and housing activnics with COUNTY in order to permit COUNTY to secure and administer Community Development Block Grant funds as an Urban County within the provisions of the Act as herein defined and, therefore, in consideration of the mutual covenants and promises contamed in this Agreement, the parties mutually agree to the following terms and conditions. COOPERATING UNIT acknowledges that by the execution of this Agreement that it understands that It: I. May not also apply for grants under the State CDBG Program from appropriations for fiscal years dunng which it is participating in the Urban County Program; and 2. May not partiCipate in a HOME Consortium except through the Urban County. I. DEFINITIONS The definitions contained ill 42 USC 5302 of the Act and 24 CFR ~570.3 of the Regulations are mcorporated herein by reference and made a part hereof, and the terms defined in this sectIOn have the meanings given them: A. "Act" means Title I ofthe Housing and Community Development Act of! 974, as amended, (42 U.S.c. 5301 et seq.). B. "ActlVlty" means a CDBG-funded activity eligible under Title I of the Housing and Commumty Development Act of 1974, as amended. Example: smgle family rehab acllvity. C. "Annual Program" means those combined activities submitted by cooperating units to COUNTY for CDBG funding as part of the Consolidated Plan. D. "Consolidated Plan" means the document bearing that tllle or similarly required statements or documents submitted to HUD for authorizatlOn to expend the annual grant amount and which IS developed by the COUNTY in conjunctlOn with COOPERA TING UNITS as part of the Commumty Development Block Grant Program. 1 iU E. "Cooperating Umt(s)" means any city or town in Hennepin County that has entered into a cooperation agreement that is identical to this Agreement, as weJl as Hennepin County, which is a party to each Agreement. F. "HUD" means the United States Department of Housing and Urban Development. G. "Metropohtan CIty" means any city located in whole or In part in Hennepin County whIch IS certIfied by HUD to have a population of 50,000 or more people. H. "Program" means the HUD Community Development Block Grant Program as dcfined under Title I of the Housing and Community Development Act of 1974, as amended. I. "Program Income" means gross Income received by the recipient or a subreclpient dIrectly generated from the use ofCDBG. J. "Regulations" means the rules and regulations promulgatcd pursuant to the Act, including but not limited to 24 CFR Part 570. K. "Urban County" means the entitlement jurisdiction wIthIn the provisions of the Act and includes the suburban HennepIn County municipalities which are slgnatones to this Agreement. II. PURPOSE The purpose of thIs Agreement is to authorize COUNTY amI COOPERATING UNIT to cooperate to undertake, or assist in undertaking, community renewal and lower income housing assistance activities and authorizes COUNTY to carry out these and other eligible activities for the benefit of eligible recipIents who reside withIn the corporate limits of the COOPERATING UNIT which wlll be funded from annual Community Development Block Grant and HOME appropriations for the Federal FIscal Years 2006, 2007 and 2008 and from any program income generated from the expenditure of such funds. III. AGREEMENT The term ofthis Agreement is for a period commencing on October I, 2005 and termInatIng no sooner than the end of the program year covered by the Consolidated Plan for the basic grant amount for the Fiscal Year 2008, as authorized by HUD, and for such additional time as may be required for the expenditure of funds granted to the County for such period. The COUNTY may nol1fy COOPERATING UNITS prior to the end ofthe Urban County quahficat!On period that the Agreement will automaticaJly be renewed unless it is termmated m writing by either party. Either the COUNTY or COOPERATING UNIT may exercise the option to terminate the Agreement at the end of the Urban County qualification period. If the COUNTY or COOPERATING UNIT fall to exerCISe that optIOn, it will not have the opportunity to exercIse that option until the end of a subsequent Urban County qualification period. The COUNTY will nOl1fy the COOPERATING UNIT in writing of Its nght to elect to be excluded by the date specified by HUD. This Agreement must be amended by written agreement of aJl parties to incorporate any changes necessary to meet the requirements for cooperation agreements set forth in the Urban County Qualifieal10n Notice applicable for the year in which the next qualification of the County is scheduled. Failure by either party to adopt such an amendment to the Agreement shaJl automatieaJly terminate the Agreement foJlowing the expenditure of aJl CDBG funds aJloeated for use in the COOPERATING UNIT's jurisdiction. Notwithstanding any other provision of thIs Agreement, this Agreement may be termInated at the end of the program penod during which HUD withdraws its designation of the COUNTY as an Urban County under the Act. 2 This Agreement shall be executed by the appropriate officers of COOPERATING UNIT and COUNTY pursuant to authority granted them by theIr respective governing bodies, and a copy of the authorizmg resolution and executed Agreement shall be filed promptly by the COOPERATING UNIT in the Hennepin County Department of Housmg, Community Works and Transit, and in no event shall the Agreement be filed later than June 30, 2005. COOPERATING UNIT and COUNTY shall take all actions necessary to assure compliance wIth the applicant's certifications required by SectIOn 104(b) of the Title I of the Housmg and Community Development Act of1974, as amended, including Title VI of the CivIl Rights Act ofl964; the FaJr Housing Act, Section 109 ofTltle I of the Housing and Community Development Act of 1974; and other apphcable laws. IV. ACTIVITIES COOPERATING UNIT agrees that awarded grant funds will be used to undertake and carry out, withm thc terms of this Ah'feement, certain activities eligible for funding under the Act. The COUNTY agrees and will assist COOPERATING UNIT in the undertaking of such essential activities by provldmg the servIces specIfied m this Agreement. The parties mutually agree to comply with all applicable reqUIrements of the Act and the RegulatIOns and other relevant Federal andlor Minnesota statutes or regulations in the use of basic grant amounts. Nothmg m this ArtIcle shall be construed to lessen or abrogate the COUNTY's responsibihty to assume all obligatIOns of an applicant under the Act, including the development of the Consolidated Plan, pursuant to 24 CFR Part 91. COOPERATING UNIT further specifically agree as follows: A. COOPERATING UNIT wiII, in acconl with a COUNTY -established schedule, prepare and provide to the COUNTY, in a prescrihed form, requests for the use of Community Development Block Grant Funds consistent with this Agreement, program regulations and the Urban Hennepin County Consolidated Plan. B. COOPERATING UNIT acknowledges that, pursuantto 24 CFR ~570.501 (b), it is subject to the same requirements applicable to subreciplents, including the requirement for a written Subreclplent Agreement set forth in 24 CFR 9570.503. The Subrecipient Agreement w1l1 cover the implementatIOn reqUIrements for eaeh actiVIty funded pursuant to this Agreement and shall be duly executed WIth and m a form prescribed by the COUNTY. C. COOPERATING UNIT acknowledges that it is subject to the same subrecipient requirements stated m paragraph B above in instances where an agency other than itself is undertaking an activity pursuant to this Agreement on behalf of COOPERATING UNIT. In such mstances, a written Third Party Agreement shall he duly executed between the agency and COOPERATING UNIT in a form prescnbed hy COUNTY. D. COOPERATING UNITS shall expend all funds annually allocated to activil1es pursuant to thIS Agreement WIthin eighteen (18) months of the authorization by HUD to expend the basic grant amount. 1. With each annual program COOPERATING UNITS shall submit to the COUNTY acl1vity schedules for the completion and expenditure offunds within eighteen (18) months. COUNTY wiII institute monitoring measures and provide technical or other assistance to insure actiVIties are proceeding on schedule. 2. Funds for activities not expended within eighteen (18) months may he recaptured at the discretion of the COUNTY and distrIbuted by COUNTY as provIded for in D. 4. LImited extensIOns to the expendIture deadlines in this sectIOn may be granted by COUNTY upon 3 written request only where the authorized activity has been initiated and/or is subject to a binding contract which provides for the expenditure to be completed within a !lme period acceptable to COUNTY. 3. Amendments to an annual program by COOPERATING UNITS may be approved by COUNTY up to fifteen (15) months after initial funding has been approved only when the new actiVIty can be completed and funding expended within six (6) months of the amendment approval. Funds not expended within the six (6) month extension penod may be recaptured and distributed by COUNTY as provided for in DA. 4. All funds recaptured by COUNTY will be transferred to a separate account for reallocation on a competitive request for proposal basis at the discretion of the COUNTY where total of such funds IS $100,000 or greater. Amounts less than $100,000 shall be allocated by COUNTY to other eXlstmg actIvitIes consIstent with timeliness reqUlrements and ConsolIdated Plan goals. E. COUNTY and COOPERATING UNITS shall expend all program income pursuant to thIS Agreement as provided below: I. Program income from housing rehabilitation actiVIties admmistered by the COUNTY will be mcorporated into a pool at the discretion of the COUNTY. This provision IS effective with the term of this Agreement commencing October 1, 2005. The pool WIll bc admmlstered by COUNTY and will be used for housing rehabilitatIOn projects located throughout the entire Urban County. When possible, COUNTY will give priority to funding housing rehabilitation projects within the COOPERATING UNIT where the program income was generated. Funds expended in this manner would be secured by a Repayment Agreement/Mortgage running in favor of the COUNTY. Program mcome generated by certain COOPERATING UNITS that admimster their own housing rehabilitation activitIes may be retamed by the COOPERATING UNIT at its discretion, however such COOPERATING UNITS will be bound by the condItIOns of D.2., above. Only COOPERATING UNITS that were administering their own activities pursuant to the Joint Cooperation Agreement pertaining to the HUD fiscal years 2003-2005 will be eligible to retain their program income. 2. COUNTY reserves the optIOn to recapture program mcome generated by non-housing rehabilitation activities if said funds have not been expended within twelve (12) months of being generated. These funds shall be transferred to a separate account for reallocatIOn on a competi!lve request for proposal basis administered by COUNTY or, where the total of such funds does not exceed $100,000, shall be reallocated by COUNTY to other eXlstmg actiVItIes consistent with timeliness reqUlrements and Consolidated Plan goals. F. COOPERATING UNITS are encouraged to undertake joint activities involving the sharing offunding when such action furthers the goals of the Consolidated Plan and meets the expendIture goals. G. If COUNTY is notified by HUD that it has not met the performance standard for the !lmely expendIture offunds at 24 CFR 570.902(a) and the COUNTY entitlement grant is reduced byHUD according to its policy on corrective actions, then the baSIC grant amount to any COOPERATING UNIT that has not met its expendIture goal shall be reduced accordingly. 4 H. COOPERATING UNIT will take actions necessary to assist in accomplishmg the community development program and housing goals, as contained m the Urban Hennepm County ConsolIdated Plan, I. COOP ERA TING UNIT shall ensurc that all activities funded, in part or in full by grant funds received pursuant to this Agreement, shall be undertaken affirmatively with regard to fair housing, employment and business opportunities for minorities and women, It shall, in implementing all programs and/or activities funded by the basic grant amount, comply with all applicable Federal and Minnesota Laws, statutes, rules and regulations with regard to civil rights, affirmative action and equal employment opportunitIes and Administrative Rule issued by the COUNTY, J, COOP ERA TING UNIT that does not affirmatively further fair housing wIthin its o\'m Junsdiction or that impedes action by COUNTY to comply with its falr housing certiiication shall be prohIbited from receiving CDBG funding for any activIties, K. COOPERATING UNIT shall participate in the citizen participation process, as established by COUNTY, m compliance with the requirements of the Housing and Community Development Act of 1974, as amended, L. COOPERATING UNIT shall reimburse COUNTY for any expenditure determined by HUD or COUNTY to be ineligible, M, COOP ERA TING UNIT shall prepare, execute, and cause to be filed all documents protecting the interests of the parties hereto or any other party of interest as may be designated by the COUNTY. N, COOPERATING UNIT has adopted and is enforcing: I. A polIcy prohibiting the use of excessive force by law enforcement agencIes wlthm its jUrIsdiction against any mdividuals engaged in nonviolent CIvIl rights demonstrations; and 2, A policy of enforcing applIcable State and local laws agamst physically barring entrance to or exit from a facility or location which is the subject of such nonviolent civil rights demonstrations within its Jurisdiction, COUNTY further specifically agrees as follows: A, COUNTY shall prepare and submIt to HUD and appropriate revlewmg agencIes, on an annual baSIS, all plans, statements and program documents necessary for receipt of a baSIC grant amount under the Act. B, COUNTY shall provide, to the maximum extent feasible, technical assistance and coordmating services to COOPERATING UNIT in the preparation and submission of a request for funding, C, COUNTY shall provide ongoing technical assistance to COOPERATING UNIT to aid COUNTY in fulfilling its responsibility to HUD for accomplishment of the community development program and housing goals, D, COUNTY shall, upon official request by COOPERATING UNIT, agree to administer local housmg rehabilitation actIvities funded pursuant to the Agreement, prOVIded that COUNTY shall receIve Twelve percent (12%) ofthe allocation by COOPERATING UNIT to the activity as reimbursement for costs associated with the administratIon of COOPERATING UNIT activity, 5 E. COUNTY may, at its discretion and upon official request by COOPERATING UNIT, agree to administer, for a possible fee, other activities funded pursuant to this Agreement on behalf of COOPERATING UNIT. F. COUNTY may, as necessary for clarification and coordinatIOn of program admlUlstration, develop and Implement Administrative Rules consistent with the Act, Regulations, HUD administrative directives, and administrative requirements of COUNTY. V. ALLOCATION OF BASIC GRANT AMOUNTS Basic grant amounts received by the COUNTY under SectIOn 106 ofthe Act shall be allocated as follows: A. COUNTY shall retain thirteen percent (13%) of the annual basic grant amount for the administratIOn of the program. Included in this administrative amount is funding for annual county-wide Fair Housing activities. B. The balance of the basic grant amount shall be made available by COUNTY to COOPERATING UNITS in accordance wIth the formula stated in part C and the procedure stated m part D ofthls sectIOn utilizing data provided by HUD. The allocation is for planning purposes only and is not a guarantee of funding. C. Allocation of funding WIll be based upon a formula using data supplied by HUD that bears the same ratIO to the balance of the basic grant amount as the average of the ratios between: 1. The population of COOP ERA TING UNIT and the population of all COOPERATING UNITS. 2. The extent of poverty in COOPERATING UNIT and the extent of poverty m all COOPERATING UNITS. 3. The extent of overcrowded housmg by units in COOPERATING UNIT and the extent of overcrowded housing by units in all COOPERATING UNITS. 4. In determining the average of the above ratios, the ratio involving the extent of poverty shall be counted twice. D. Funds will be made available to communitIes utilizing the formula specified m C ofthis Section m the following manner: 1. All COOPERATING UNITS with aggregate formula percentages of h'l"eater than three and one half percent (3.5%) of the total using the procedure in part C. of this section will recewe funding allocatIOns in accordance wIth the COUNTY formula allocatIOns. 2. COOPERATING UNITS with aggregate formula percentages of three and one half percent (3.5%) or less of the total using the procedure in part C. of this section will have their funds consolidated into a pool for award in a manner determined by COUNTY on a competitive request for proposal basis. Only the COUNTY and COOPERATING UNITS whose fundmg has been pooled WIll be eligible to compete for these funds. E. The COUNTY shall develop these ratios based upon data to be furnished by HUD. The COUNTY assumes no duty to gather such data independently and assumes no liability for any errors in the data furnished by HUD. 6 F. In the event COOPERATING UNIT does not request a fundIng allocatIOn, or a portion thereot~ the amount not requested shall be made available to other participatIng communities, in a manner determined by COUNTY, VI. METROPOLITAN CITIES Any metropolitan city executing this Agreement shall defer their entitlement status and become part of Urban Hennepin County. This agreement can be voided if the COOPERATING UNIT is advised by HUD, prior to the completIOn of the re-qualification process for fiscal years 2006-2008, that it is eligible to become a metropolitan city and the COOPERATING UNIT elects to take its entitlement status. If the agreement is not voided on the basIs of the COOPERATING UNIT's eligibility as a metropolitan city prior to July 8, 2005, the COOPERATING UNIT must remain a part of the COUNTY program for the entire three-year period of the COUNTY qualification. VII. OPINION OF COUNSEL The undersigned, on behalf of the Hennepin County Attorney, having reviewed this Agreement, hereby opines that the terms and provisions of the Agreement are fully authorized under State and local law and that the COOPERATING UNIT has fun legal authonty to undertake or assIst in undertakIng essenlIal community development and housing assistance activities, specifically urban renewal and publicly-aSSIsted housmg. Assistant County Attorney 7 VIII. HENNEPIN COUNTY EXECUTION The Hennepin County Board of CommissIOners having duly approved this Agreement on May 2.2005, and pursuant to such approval and the proper County official having SIgned this Agreement, the COUNTY agrees to be bound by the provisions herein set forth. COUNTY OF HENNEPIN, STATE OF MINNESOTA By: Chair of Its County Board And: Assistant/Deputy/County Admmistrator Attest: Deputy/Clerk of the County Board RECOMMENDED FOR APPROVAL Assistant County Admmistrator - Public Works APPROVED AS TO FORM: Date: Assistant County Attorney Director, Housing, Commumty Works and Transit Department Date: Date: APPROVED AS TO EXECUTION: Assistant County Attorney Date: 8 IX. COOPERATING UNIT EXECUTION COOP ERA TING UNIT. havmg si/,'11ed this Agreement, and the COOPERATING UNIT'S govemmg body having duly approved this Agreement on , 2005, and pursuant to such approval and the proper city official havmg signed this Agreement, COOPERATING UNIT agrees to be bound by the provisions of thIs Joint Cooperation Agreement, contract A CITY OF By: Its Mayor And: Its CIty Manager ATTEST: CITY MUST CHECK ONE: The City is orgamzed pursuant to: PlanA PlanB Charter June 2, 2005 9