IV.1. MHFA POHP Loan Repayment Agreement (HRA2022-04)
September 6, 2022 HRA Report 2022-04
MHFA POHP Loan Repayment Agreement
Proposed Action:
Staff recommends that the Council approve the following motion: adopt Resolution
#546, approving to borrow a zero-interest forgivable loan from the Minnesota Housing Finance
Agency (MHFA) regarding the building system improvements for Dow Towers
With the approval of this motion, staff will be able to close on the end loan amount of
$393,005.00 with MHFA.
Overview:
MHFA has a competitive funding program that uses the proceeds of General Obligations Bonds to
provide financial assistance in the form of a deferred, forgivable loan for the rehabilitation and
preservation of public housing properties called Publically Owned Housing Program (POHP).
MHFA committed $393,005.00 to Dow Towers from the program to improve exterior doors,
building ventilation system, a portion of the building plumbing, and water softeners. The project
cost $644,721.00. The construction project was completed in October of 2019. MHFA Loan
Commitment to Hopkins HRA expires on October 5, 2022.
Supporting Information:
• Borrowing Resolution #546
• Exhibit A
Items to Consider:
• Declaration of Covenant
• Addendum to Declaration (Affordability)
Alternative
• The HRA has the following alternatives regarding this issue:
1. Approve the action as recommended by staff
2. Continue for further information
Muse Mohamed, Executive Director
HOUSING AND REDEVELOPMENT AUTHORITY
OF HOPKINS, MINNESOTA
Hennepin County
RESOLUTION No. 546
RESOLUTION AUTHORIZING THE HRA TO BORROW A ZERO-INTEREST,
FORGIVABLE LOAN FROM THE MINNESOTA HOUSING FINANCE AGENCY
I HEREBY CERTIFY that I, Muse Mohamed, am the Executive Director and
keeper of the records of the Housing and Redevelopment Authority of Hopkins, Minnesota,
public body corporate and politic of the City of Hopkins, Minnesota, which is a political
subdivision of the State of Minnesota (the “HRA”), that the preceding is a true and
correct copy of the Resolution duly adopted by a quorum of the members of the HRA,
September 6th 2022, the members of the HRA being present constituting a
quorum for the transaction of business; further, that such meeting was called in
compliance with all applicable laws of the HRA; that such Resolution does not conflict
with any laws of the HRA nor have such Resolutions been in any way altered,
amended or repealed and are in full force and effect, unrevoked and unrescinded as
of this day, and have been entered upon the regular Minute Book of the HRA, as of
the aforementioned date, and that all of the members of the HRA have and at the time of
adoption of such Resolution, had full power and lawful authority to adopt such
Resolutions and to confer the powers thereby granted to the officer therein named
who has full power and lawful authority to exercise the same.
WHEREAS, on September 6th 2022, there has been presented to the meeting of
the HRA a proposal for the HRA to borrow a zero-interest, forgivable loan from
the Minnesota Housing Finance Agency, a public body corporate and politic of the
State of Minnesota, 400 Wabasha St N Unit 400, St Paul, Minnesota 55102 (the
“Agency”) in an amount not to exceed $393, 005.00 (the “Loan”) that will be forgiven
in twenty (20) years, which Loan will be evidenced by a Deferred Loan
Repayment Agreement. Further, a General Obligations Bonds Declaration of
Covenants, Conditions and Restrictions (the “G.O. Declaration”) and a
Publicly Owned Housing Program Declaration of Covenants, Conditions and
Restrictions (the “POHP Declaration”) shall be executed in connection with the
Loan, the terms of which require that (i) the HRA retains ownership of the
Development located at 22 5th Ave South in Hopkins in the County of Hennepin, State
of Minnesota, and more fully described in Exhibit A attached hereto and made a part
hereof, and (ii) provides public housing for a term of thirty-five (35) years. The
Deferred Loan Repayment Agreement, the G.O. Declaration and the
POHP Declaration are referred to collectively as the “Loan Documents.”
1
NOW, THEREFORE, be it resolved by all members of the HRA that
the Executive Director of the HRA be hereby authorized on behalf of the HRA, at any
time hereafter and without further action by or authority or direction from the HRA, to
execute and deliver to the Agency in such form as may be required by the Agency,
the Loan Documents evidencing the indebtedness.
NOW, THEREFORE, be it resolved by the members of the HRA, that the HRA
be and hereby is authorized to borrow the funds referred to herein above from the agency,
and,
BE IT FURTHER RESOLVED, that the Executive Director, Muse Mohamed,
of the HRA be hereby authorized and directed on behalf of the HRA at any time
and from time to time hereafter and without further action by or authority or
direction from the HRA, to execute and deliver or cause to be executed and
delivered, all such other further agreements, assignments, statements, instruments,
certificates and documents and to do or cause to be done all such other and further
acts and things as they may determine to be necessary or advisable under or in
connection with such borrowing, and that their execution of any such agreement,
assignment, statement, instrument, certificate or document, or the doing of any
such act or thing, shall be conclusive evidence of their determination in that respect; and
BE IT FURTHER RESOLVED, that the Agency be and it hereby is authorized
to rely on the continuing force and effect of these Resolutions, until receipt by the
Commissioner of the Agency at its principal office of notice in writing from the HRA
of any amendments or alterations thereof.
Adopted this 6th day of September, 2022.
By
Patrick Hanlon, HRA Board Chair
ATTEST:
Muse Mohamed, Executive Director
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Dow Towers, Hopkins
POHP Program
Declaration of Covenants
(Ver. 2/5/2019)
MHFA Dev. #6379
7/21/2022
1
FOR USE BY FILING OFFICER ONLY
Minnesota Housing Finance Agency
Publicly Owned Housing Program
DECLARATION
OF COVENANTS, CONDITIONS AND RESTRICTIONS
THIS DECLARATION is made as of the _____ day of _________, 2022, by Housing and
Redevelopment Authority in and for the City of Hopkins, a public body corporate and politic of
the City of Hopkins, with its offices located at 1010 1st Street South, Hopkins, MN 55343
(“Declarant”).
RECITALS:
A. Declarant, as the owner in fee simple of the property located in the City of Hopkins,
County of Hennepin, State of Minnesota, described in Exhibit A attached to this Declaration and
made a part of this Declaration (the “Property”), has applied for a loan from the Minnesota
Housing Finance Agency (“Lender” or “MHFA”), and Lender has selected Declarant to receive a
loan under Lender’s Publicly Owned Housing Program (“POHP”) pursuant to Minnesota
Statutes, Chapter 462A, and the rules promulgated thereunder, as may be amended, modified, or
replaced from time to time (the “Act”), in the original principal amount of $393,005.00 (the
“Loan”) to aid Declarant in the acquisition, construction and/or rehabilitation of and financing on
the Property of a housing development (the “Development”, as further defined in this
Declaration) pursuant to the Act.
B. The Act, together with any requirements arising from program-specific provisions
in state or federal law, regulations, guidebooks, handbooks, or notices, constitutes the
“Program”.
C. The Program imposes income and rent and occupancy restrictions on the Assisted
Units (as defined in this Declaration) and requires that these restrictions remain in place for the
minimum period shown on the attached Addendum to this Declaration; and
Dow Towers, Hopkins
POHP Program
Declaration of Covenants
(Ver. 2/5/2019)
MHFA Dev. #6379
7/21/2022
2
D. Declarant desires to obtain the Loan and to impose on the Development the
mutually beneficial covenants, conditions and restrictions set forth in this Declaration.
NOW THEREFORE, Declarant, as fee owner of the Property, and in consideration of
the benefits to be derived therefrom by Declarant and its successors and assigns, makes the
following declaration of the covenants, restrictions, limitations, conditions and uses (the
“Covenants”) applicable to the Development.
ARTICLE I
Definitions
As used in this Declaration, the following terms have the following respective meanings:
For the purposes of this Declaration, the definitions set forth above or set forth in the
Addendum are incorporated into this Article 1 by reference.
Section 1. “Assisted Units” means those units in the Development that are restricted as set
forth in the attached Addendum to this Declaration.
Section 2. “Declarant” means Housing and Redevelopment Authority in and for the city
of Hopkins, a public body corporate and politic of the City of Hopkins, and any successor or
assign that is the owner of the Development from time to time.
Section 3. “Development” means the Property and all improvements now or hereafter
located thereon, together with all assets of whatsoever nature used in or owned by the business
conducted on the Property, identified as MHFA Development No. 6379.
Section 4. “HUD” means the United States Department of Housing and Urban
Development.
Section 5. “Income Restrictions” means the income restrictions as set forth in the
attached Addendum to this Declaration.
Section 6. “Occupancy Restrictions” means those occupancy restrictions as set forth in
the attached Addendum to this Declaration.
Section 7. “Rent Restrictions” means the rent restrictions as set forth in the attached
Addendum to this Declaration.
ARTICLE II
Income, Rent and Occupancy Restrictions
Dow Towers, Hopkins
POHP Program
Declaration of Covenants
(Ver. 2/5/2019)
MHFA Dev. #6379
7/21/2022
3
Section 1. Income Restrictions. Declarant declares, represents, covenants and agrees for
itself and its successors and assigns that, for the term of this Declaration, the Assisted Units will
be occupied by residents who satisfy the Income Restrictions.
Section 2. Rent Restrictions. Declarant declares, represents, covenants and agrees for
itself and its successors and assigns that, for the term of this Declaration, the amount of rent to be
charged to the residents of the Assisted Units will satisfy the Rent Restrictions.
Section 3. Occupancy Restrictions. Declarant declares, represents, covenants and agrees
for itself and its successors and assigns that, for the term of this Declaration, the Assisted Units
will be occupied by residents who satisfy the Occupancy Restrictions.
ARTICLE III
Enforcement of Income, Rent and Occupancy Restrictions
Section 1. Declarant will permit, during normal business hours and upon reasonable
notice, any duly authorized representative of Lender to inspect any books and records of
Declarant with respect to the incomes of the residents of the Assisted Units, the rents charged for
the Assisted Units, and Occupancy Restrictions to ensure compliance with the requirements of
Article II of this Declaration and the Program.
Section 2. At Lender’s request, Declarant will submit any other information, documents or
certifications that Lender, in its sole discretion, deems necessary to substantiate Declarant’s
compliance with the requirements of Article II of this Declaration and the Program.
Section 3. Declarant covenants that it will not knowingly take or permit any action that
would result in a violation of the requirements of Article II of this Declaration or the Program.
Declarant covenants to take any lawful action, including amendment of this Declaration, as may
be necessary, in the opinion of Lender, to comply fully with the Program and with all applicable
rules, rulings, policies, procedures, regulations or other official statements promulgated or
proposed by the State of Minnesota, Lender, or HUD from time to time pertaining to Declarant’s
obligations under the Program and affecting the Development.
ARTICLE IV
Representations, Covenants, and Warranties of Declarant
Section 1. Declarant declares, represents, covenants and agrees for itself, its successors and
assigns, that, for the term of this Declaration, it will not refuse to lease a unit to, or discriminate
against, a prospective resident because the prospective resident is the holder of a voucher under
Section 8 of the United States Housing Act of 1937 (42 U.S.C. § 1437f), a recipient of any other
form of tenant-based rental assistance, or due to the requirements of the voucher or rental
assistance program.
Dow Towers, Hopkins
POHP Program
Declaration of Covenants
(Ver. 2/5/2019)
MHFA Dev. #6379
7/21/2022
4
Section 2. Declarant declares, represents, covenants and agrees for itself and its successors
and assigns that, for the term of this Declaration, each Assisted Unit is and will remain suitable
for occupancy and meet the minimum housing standards required by Lender.
Section 3. Declarant declares, represents, covenants and agrees for itself and its successors
and assigns that it will obtain Lender’s consent in writing prior to any sale, transfer, or exchange
of the Development or any portion thereof, during the term of this Declaration.
Section 4. Declarant declares, represents, covenants and agrees for itself and its successors
and assigns that it has not and will not execute any other agreement with provisions
contradictory to, or in opposition to, the provisions of this Declaration and that, in any event, the
requirements of this Declaration are paramount and controlling as to the rights and obligations
set forth in this Declaration and supersede any other requirements in conflict with this
Declaration.
Section 5. Declarant declares, represents, covenants and agrees for itself and its successors
and assigns that, for the term of this Declaration, the Assisted Units will be subject to the Income
Restrictions, Rent Restrictions, and the Occupancy Restrictions.
Section 6. Declarant declares, represents, covenants and agrees for itself and its successors
and assigns that, for the term of this Declaration, that it will provide any and all information and
reports as required by this Declaration.
ARTICLE V
Term
Section 1. This Declaration will remain in full force and effect for a period ending 35 years
from the date of this Declaration.
Section 2. Subject to Section 1 of this Article V, Declarant declares, represents,
covenants and agrees for itself and its successors and assigns that the obligation to operate the
Development subject to this Declaration and the Program for the term of the Declaration is
independent of the existence of the Loan and that the provisions of this Declaration will survive
the termination or extinguishment of the Loan and of any other security instruments placed of
record in connection with financing of the Development by Lender and survive the termination
of any subsequent financing or security instruments placed of record by other lenders.
ARTICLE VI
Amendment, Termination of Covenants
Section 1. The provisions of this Declaration will not be amended during the term of this
Declaration, except by an instrument in writing executed by Lender and Declarant, or their
respective successors or assigns except as set forth in this Declaration. Lender, or its successors
or assigns, has the right to terminate this Declaration at any time in its sole discretion.
Dow Towers, Hopkins
POHP Program
Declaration of Covenants
(Ver. 2/5/2019)
MHFA Dev. #6379
7/21/2022
5
Section 2. Unless sooner amended or terminated as provided in this Article VI, the
Covenants contained in this Declaration will continue in full force and effect through the term of
this Declaration and will then terminate and be of no further force or effect.
ARTICLE VII
Miscellaneous
Section 1. Covenants Touch and Concern. Declarant agrees that these Covenants confer
a financial benefit upon Declarant and constitute a burden on the use of Declarant’s property, but
Declarant agrees such burden is reasonable given the benefits of the transaction to Lender,
Declarant, and the residents on whose behalf Lender exercised the powers given to it by law.
Section 2. Covenants Running with the Land. This Declaration constitutes covenants
that run with the land and are binding upon Declarant, its successors, heirs or assigns, and all
subsequent owners of all or any part of the Development, together with their grantees,
successors, heirs, executors, administrators, devisees or assigns.
Section 3. Lender Sole Representative. This Declaration inures solely to the benefit of
Lender. Lender, or its successors or assigns, is designated as the sole and exclusive
representative of any and all other persons or entities also benefited by the Covenants with
respect to the enforcement, construction, interpretation, amendment, release and termination of
the Covenants.
Section 4. Remedies. Lender, or its successors and assigns, may institute and prosecute
any proceedings at law or in equity to abate, prevent or enjoin any violation, or to specifically
enforce, the Covenants, or to recover monetary damages caused by that violation or attempted
violation. No delay in enforcing the provisions of this section as to a violation will waive the
right to enforce that violation at any later time.
Section 5. Severability. If any provisions of this Declaration are found to be invalid,
illegal or unenforceable, the validity, legality and enforceability of the remaining portions will
not in any way be affected or impaired.
Section 6. Choice of Law. This Declaration is governed by the laws of the State of
Minnesota.
ARTICLE VIII
Notices
Any notice or petition required to be given to Lender or Declarant under this Declaration
must be given in writing by personal delivery or certified mail at the address of such parties
Dow Towers, Hopkins
POHP Program
Declaration of Covenants
(Ver. 2/5/2019)
MHFA Dev. #6379
7/21/2022
6
specified below, or at such other address as may be specified by that party by notice given to the
other party:
Lender:
Minnesota Housing Finance Agency
400 Wabasha Street North, Suite 400
St. Paul, MN 55102-1109
Attention: Assistant Commissioner, Multifamily
Declarant:
Housing and Redevelopment Authority in and for the City of Hopkins
101 1st Street South
Hopkins, MN 55343
Attention: Executive Director
(THE REMAINING PORTION OF THIS PAGE WAS INTENTIONALLY LEFT BLANK)
Dow Towers, Hopkins
POHP Program
Declaration of Covenants
(Ver. 2/5/2019)
MHFA Dev. #6379
7/21/2022
7
IN WITNESS WHEREOF, Declarant has executed this Declaration as of the date first
written above.
DECLARANT:
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF
HOPKINS
a public body corporate and politic of the City of
Hopkins
By:
Muse Mohamed, Executive Director
STATE OF MINNESOTA )
) ss
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this _____day of __________,
2022, by Muse Mohamed, the Executive Director of the Housing and Redevelopment Authority
in and for the City of Hopkins, a public body corporate and politic of the City of Hopkins, on
behalf of the authority.
Notary Public
THIS DOCUMENT WAS PREPARED BY:
Minnesota Housing Finance Agency
400 Wabasha Street North, Suite 400
St. Paul, MN 55102-1109
Dow Towers, Hopkins
POHP Program
Declaration of Covenants
(Ver. 2/5/2019)
MHFA Dev. #6379
7/21/2022
8
Exhibit A
LEGAL DESCRIPTION
Parcel 1:
Lots 1, 2, 3, 4 and 5, Block 1, “West Minneapolis”.
Parcel 2:
That part of the Southwest Quarter of the Southeast Quarter of Section 24, Township 117, Range
22, lying Southwesterly of a line drawn parallel with and 20 feet Northeasterly from the
Northeasterly line of Block 1, “West Minneapolis” and between the extensions North across it of
the East line of Lot 1 in said Block 1 and the center line of the alley adjoining the West line of
said Lot 1.
Parcel 3:
That part of the vacated alley adjoining the West line of Lot 1, Block 1, “West Minneapolis”
lying East of the centerline of said alley and between the extensions across it of the Northeasterly
line of said Lot 1 and the North line of the South 14 feet of Lot 30 in said Block 1.
Torrens Property.
Dow Towers, Hopkins
POHP Program
Declaration of Covenants
(Ver. 2/5/2019)
MHFA Dev. #6379
7/21/2022
9
Attach Addendum
ADDENDUM TO
Minnesota Housing Finance Agency
Publicly Owned Housing Program (Public Housing)
DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS
Total number of units in the Development: 76
Total number of units assisted with Program funds
(the “Assisted Units”) and restricted as set forth
below:
76
A. INCOME RESTRICTIONS. Assisted Units must be occupied by households whose gross annual
household income at initial occupancy does not exceed the Income Restriction(s) set forth below.
PROGRAM # OF
ASSISTED
UNITS
INCOME
RESTRICTED
INCOME RESTRICTIONS MAXIMUM
TERM (YRS.)
OF
RESTRICTION*
POHP 76 Resident of public housing or whose income does
not exceed the maximum household income as
determined by HUD.
35
*Subject to Article V, Section 1 of the Declaration.
B. RENT RESTRICTIONS. Gross rents, including an allowance for tenant-paid utilities, must not
exceed the Rent Restriction(s) set forth below.
NONE
ADDITIONAL INSTRUCTIONS FOR INCOME AND/OR RENT RESTRICTIONS: Income and
rent limits are updated annually. Declarant is responsible for implementing new limits when they become
effective.
NONE
C. OCCUPANCY RESTRICTIONS. Declarant must comply with any Occupancy Restrictions set
forth below.
NONE
Dow Towers, Hopkins MHFA Dev. #6379
POHP Program 3/19/2019
Declaration of Covenants
(Ver. 11/9/2018) A-1
Photos before the improvements
Photos after the improvements