Agenda Packets - 1995/06/05 - Laserfiche WebLink

Home Browse Search

-3- • In addition to indicating a requested allocation, cities may also want to note a minimum acceptable allocation amount on their application. A high number of city applications under the '95 MCPP can potentially result in small allocations for small to medium sized cities, possibly as low as the $100,000 minimum. Programs that deliver only 2-3 loans may not be cost effective, given the staff time required of both the city and lenders. If the individual allocation as determined by the per capita formula falls below a level the city cites as an acceptable "minimum," the Agency would then cancel the application and contact the city to confirm. USAGE TEST: Cities applying for funds under the 1995 MCPP must also meet a minimum "usage test," to be considered eligible to apply in following program years. Specifically, a city must use at least 50% of their 1995 allocation by the date of program expiration in or er to be eiigib1 to apply in 1996 or 1997 Failure to meet this 50% test -results- in ineligibility for the MCPP in the following 2 years. This test has been modified by the legislature from 1994, when low usage resulted in only a one year ineligibility period. The Agency will periodically provide participating cities with a usage report during the program term to help them track compliance with this requirement. The usage test also applies to cities that, upon receiving their allotment, choose to sell their own bonds and set up their own lender origination system (those that do not contract with MHFA under the MCPP). Upon request, these cities are required to submit loan origination data to the Agency to confirm compliance with this statutory requirement: PROGRAM TERM: For 1995, the MCPP program term will run for six months, with cities having exclusive use of their individual allotments for a four month period, followed by a "collapse" of all individual allotments into a single, statewide pool available to all MCPP participating cities for the final two months of the program. This system allows the security of local fund availability for the majority of the program term, but also allows cities experiencing higher demand to satisfy those needs by tapping unused funds during the final program phase. The starting date, four month allotment "collapse" date and six month program expiration date will be determined shortly after the bond sale. Participating cities will be immediately notified at that time. As in past programs, the Agency will retain the right to adjust the program interest rate during the term of the MCPP ELIGIBLE PARTICIPANTS: All Minnesota cities with the exception of those that receive a separate entitlement of bonding authority (e.g., Minneapolis, St. Paul, cities located in Dakota County), are eligible to submit proposals to participate in the MCPP. Under the MCPP, a "city" means a city as defined in Minnesota Statutes § 462C.02, subdivision 6. Generally, this includes all cities, city and county housing and redevelopment authorities, port authorities and economic development authorities. (References to "cities" herein is to all entities authorized under this statute.)