CR 2003-017 Resolution 2003-008 Supporting Changes to Henniepin County Housing and Redevelopment authority
CITY OF
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February 4, 2003
HOPKINS
Council Report 2003-017
Resolution 2003-008 Supporting Changes to MS 383B.77 Hennepin County
Housing and Redevelopment Authority (HCHRA).
Proposed Action
Staff recommends adoption of the following motion: Move to approve Resolution 2003-008
SupportinQ ChanQes to MS 3838.77 Hennepin County HousinQ and Redevelopment
Authority (HCHRA).
Overview
The Hennepin County Housing and Redevelopment Authority (HCHRA) was established by
Minnesota Statutes 383B.77 and holds all of the powers of a housing and redevelopment
authority as prescribed by MS 469.001 through 469.047 (the HRA Act). Thus the HCHRA has
essentially the same powers as a city HRA, including the authority to levy a special tax not to
exceed 0.0144% of the taxable market value of all property within its area of operation.
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The current enabling legislation limits the authority of the HCHRA by stating that it "shall not
exercise its powers" in a municipality where a city HRA had been created prior to June 1971,
unless the city HRA requests the HCHRA to do so. Hopkins is one of only four cities that had
an HRA in place prior to 1971. Thus, for the HCHRA to be able to levy for taxes in Hopkins,
Hopkins must annually request that the HCHRA do so. Additionally, if Hopkins were to request
the HCHRA to levy the special tax in the City under the existing legislation, the Hopkins HRA
levy capacity would be reduced or eliminated.
The current legislative requirements imposed on the HCHRA treat municipalities differently by
limiting potential HCHRA levy in some cities but not in others. County attorneys have concluded
that the HCHRA cannot legally levy for taxes in some cities without applying the same levy to
the four cities with pre-1971 HRA's. This stipulation effectively prevents the HCHRA from
levying the special tax anywhere in the County.
Hennepin County is proposing changes to the existing legislation that would allow the HCHRA
to levy for taxes in all cities in the county, regardless of when the cities created their respective
HRA's. The City of Hopkins has been asked by the County to support these changes.
Primary Issues to Consider
· What are the primary changes being proposed?
· How will the proposed changes affect Hopkins taxpayers?
· How will the proposed changes affect the Hopkins HRA?
· What activities does the HCHRA currently undertake in Hennepin County?
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SupportinQ Documentation
· Resolution 2003-008 Supporting Changes to MS 383B.77 Hennepin County Housing and
Redevelopment Authority (HRA)
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Steve Stahmer
Assistant to the Cit Mana er
Financial Impact: $ Budgeted: Y/N Source:
Related Documents (CIP, ERP, etc.):
Notes:
Proposed HCHRA Legislation Changes
Council Report 2003~O] 7
Page 2
. Analysis of Primary Issues
· What are the primary changes being proposed?
The proposed changes would delete the followinq section of the current MS 3838.77:
"The county authority shall not exercise its powers in a municipality where a
housing and redevelopment authority was created under MS 1969, chapter 462,
before June 8, 1971, except as provided in this subdivision"
This change would eliminate the need for Hopkins, St. Louis Park, Robbinsdale and
Minneapolis to request the HCHRA special levy. Thus the HCHRA could levy the tax without
the permission of these Cities. It will also allow all cities within the county to be treated equally
with regard to the levy authorIty of the HCHRA
The HCHRA special levy would be implemented by an annual vote of the County Board of
Commissioners and would be subject to the normal requirements governing the establishment
of local levies including the Truth in Taxation hearing process.
· How will the proposed changes affect Hopkins taxpayers?
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The average home in Hopkins (i.e., median taxable market value) would be subject to a
maximum HCHRA levy of approximately $21 per year ($146,250 X 0.000144), although the
County could choose to levy an amount which is less than the 0.0144% maximum. The levy
would apply to all taxable property in Hopkins.
· How will the proposed changes affect the Hopkins HRA?
According to attorneys for Hennepin County, the proposed changes would not reduce the levy
authority of the Hopkins HRA due to implementation of the HCHRA special levy; the Hopkins
HRA would retain its full capacity to levy. It is possible that language may be added to the
proposal which would affirmatively state that the HCHRA levy would have no effect on city HRA
levies - this is still under discussion. In addition, the notice and approval process which
ensures that the HCHRA carries out projects only when agreed upon by the City, would remain
in effect. The statute states that:
"If a housing or redevelopment project is undertaken in Hennepin County
pursuant to this section, the governing body of the city must approve the project
before it is undertaken."
This language does not refer to the act of levying of taxes, which would be allowed without
approval by cities with pre-1971 HRA's, but rather to specific HCHRA activities within the City.
Examples of such activities are listed below.
· What activities does the HCHRA currently undertake in partnership with
municipalities in Hennepin County?
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(as detailed by Hennepin County)
· Administration of federal HUD programs for rental housing, homeownership and
homelessness;
· Administration of state MHFA programs for housing rehabilitation and first-time
homeowners;
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Proposed HCHRA Legislation Changes
Council Report 2003-0 I 7
Page 3
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Provision of county assistance through the Affordable Housing Incentive Fund to
increase affordable rental and ownership housing opportunities;
Tax-exempt financing for housing, including senior housing and community facilities;
Transportation corridor planning and investments including a focus on Transit-
Oriented Development;
Creation of community infrastructure and amenities through Hennepin Community
Works to increase housing and job opportunities and enhance the tax base; and
Assistance with brownfield cleanup, economic development technical assistance and
small business finance.
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Council Options Re~ardinQ the Resolution
The Council may:
1. vote to pass the resolution;
2. vote to pass the resolution with any recommended changes or conditions;
3. vote not to pass the resolution; or
4. continue the discussion and direct staff to gather more information.
Staff Recommendation
Staff recommends approving Resolution 2003-008 Supporting Changes to MS 3838.77
Hennepin County Housing and Redevelopment Authority (HCHRA).
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CITY OF HOPKINS
HENNEPIN COUNTY, MINNESOTA
RESOLUTION 2003-008
RESOLUTION SUPPORTING CHANGES TO MS 383B.77 HENNEPIN COUNTY
HOUSING AND REDEVELOPMENT AUTHORITY (HCHRA).
WHEREAS, the Hennepin County Housing and Redevelopment Authority
(HCHRA) was created pursuant to special law MS 3838. 77 (Laws 1987, c. 177, Sec. 1)
with all the powers granted by the statewide "HRA Act" including the power to levy a
special tax not to exceed 0.0144% of taxable market value; and
WHEREAS, MS 383B.77 requires the HCHRA to notify communities annually of
its programs, and further requires that HCHRA must receive approval by resolution of
the governing body of a City before it can undertake any project; and
WHEREAS, the MS 383B.77 also requires that cities with a housing and
redevelopment authority (HRA) in existence prior to June 8, 1971 must request annually
that the HCHRA levy the special tax in their city, in which case the County levy reduces
any local levy for HRA Act purposes; and
WHEREAS, this requirement affects only 4 of 28 municipal HRA's in Hennepin
County, and therefore treats municipalities unequally by limiting the potential levy for
HRA Act purposes in some cities but not in others; and
WHEREAS, the Hennepin County Board of Commissioners has approved
seeking a legislative change to MS 383B.77 to clarify the HCHRA's levy authority by
deleting this requirement affecting only pre-1971 municipal HRA's, and allowing the pre-
1971 HRAs to continue their levy; and
WHEREAS, it is the position of the County that this legislative initiative be
pursued only in the event that the goal of clarifying the HCHRA's levy authority is
achieved, and that any other amendments which would have a negative effect on either
the HCHRA or municipal HRA's would be strenuously opposed including withdrawal of
the proposed legislation.
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of
Hopkins goes on record in support of the proposed changes to MS 383B.77 insofar as
the HCHRA's levy authority will in no way reduce, restrict or otherwise infringe on the
levy authority and capacity of the Hopkins HRA, and insofar as the City of Hopkins
retains the authority to reject proposed HCHRA activities within the City in the event that
the interests of the County and the City of Hopkins are in conflict.
BE IT FURTHER RESOLVED, that the City of Hopkins requests that staff be
kept appraised by Hennepin County of the status of legislative deliberations on this
matter.
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Adopted by the City Council of the City of Hopkins, Minnesota, this
,2002.
day of
Eugene J. Maxwell, Mayor
ATTEST:
Terry Obermaier, City Clerk