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Item No: 7B Meeting Date: April 22, 2013 Type of Business: EDA Administrator Review : ____ City of Mounds View Staff Report To: Economic Development Authority (EDA) From: Heidi Steinmetz, Economic Development Specialist Item Title/Subject: Review Home Improvement Loan Program Background The Home Improvement Loan Program was created by the EDA in late 2010 to provide additional home improvement loan options to Mounds View residents. Shown below, the program offers four types of loans, three of which cater to low-income residents who may not qualify for traditional home improvement loan financing. Loan Name Loan Amount Interest Rate Payment Type Home Demolition Up to $10,000 3% Fixed Code Enforcement Up to $7,000 0% Fixed General Home Repair Up to $10,000 3% Fixed Emergency Deferred Up to $7,000 0% Deferred Attached is the loan criteria for each of the four loans. Since the program’s inception, two loans have closed; one for a bathroom remodel and another for a new roof. A third loan (a home demolition loan) is expected to close on Tuesday. Including the third loan, the total loan funds used will be about $24,000. The total loan fund budget for 2013 is $150,000. Side Note: The Housing Resource Center administers loans for Mounds View, Woodbury, Shoreview, Roseville, Oakdale and Minnesota Housing, all of which have been less productive in the past several years. Housing Resource Center staff suggests reasons for the decrease in loans could be the economic downturn, including unemployment stress, and the decrease in property values. Discussion Since the City Council’s 2013 Priority Statement relates to the revitalization of County Road 10, the EDC reviewed the Home Improvement Loan Program at their April 19th meeting to discuss whether the Home Improvement Loan Program should be discontinued and the funds transferred towards County Road 10 revitalization. City staff will provide the EDA with a verbal summary of the EDC’s discussion.