Minneapolis/ Real Estate & Development
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Published on April 06, 2024
Saint Paul Offers $3 Million in Zero-Interest Loans to Preserve Affordable HousingSource: Unsplash / Ronnie George

In a move to keep housing affordable in Saint Paul, the city's Housing and Redevelopment Authority (HRA) is extending a lifeline to landlords of unassisted rental properties. The HRA has sounded the call for applications to its Naturally Occurring Affordable Housing (NOAH) Preservation Fund, an initiative offering 0% interest deferred loans that aim to preserve low-rent housing in the urban sprawl.

The application process is now open, with interested property owners required to email their submissions to [email protected] by the afternoon deadline of 4:30 p.m., on April 29, officials detailed on the city's website. The guidelines for applying outline a set of conditions, including project and financial feasibility, as well as the alignment with the HRA's preservation priorities. On the table is a slice of the $3 million fund pie, a significant sum that the authority is prepared to distribute carefully, and judiciously.

Property eligibility is quite straightforward. Any housing unit featuring three or more rentals within the Saint Paul limits can be in the running for funding — which operates as a secondary loan to the primary mortgage. Here's the deal: Borrowers agree to maintain at least 80% of their units at designated affordable rent levels, which correlate to income caps for the duration of the loan's term, which spans 20 to 30 years. Specifically, each project must keep a minimum of 60% of its units at or below 60% of the Area Median Income (AMI) and 20% beneath 50% of AMI. There's room for flexibility with up to 20% of units not bound to these restrictions.

According to details released by the city, this robust initiative is financed by the HRA Housing Trust Fund, which is prepared to dispense the entire $3 million if the projects that knock on its door meet their stringent requirements. If not all funds are claimed, or additional finances are sourced, another call for proposals could be sounded later in 2024.

For those parties still mulling over whether to take part in this effort to keep the Saint Paul community accessible, Danielle Sindelar, the NOAH Preservation Fund Project Manager, is the go-to resource for all questions and clarifications on the program.