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Item No: 7A Meeting Date: March 12, 2012 Type of Business: EDA Administrator Review: ____ City of Mounds View Staff Report To: Economic Development Authority From: Heidi Steinmetz, Economic Development Specialist Item Title/Subject: Resolution 12-EDA-269, Approving Application to Ramsey County for a Community Development Block Grant to Fund the Acquisition, Demolition and Replacement of Two Single- Family Blighted Vacant/Foreclosed Homes in Mounds View Introduction Ramsey County is now accepting applications for Community Development Block Grant (CDBG) funds for 2012. Funds would be available after July 1, 2012. Beginning in 1974, the CDBG program is one of the longest-running programs of the U.S. Department of Housing and Urban Development (HUD). The program funds local community development activities such as affordable housing, anti-poverty programs, and infrastructure development. Over a 1, 2, or 3-year period, as selected by the grantee, not less than 70 percent of CDBG funds must be used for activities that benefit low-and-moderate-income persons. Each activity must meet one of the following national objectives for the program: benefit low-and moderate-income persons, prevention or elimination of slums or blight, or address community development needs having a particular urgency because existing conditions pose a serious and immediate threat to the health or welfare of the community for which other funding is not available. Background It has been several years since the City of Mounds View has applied for and received CDBG funding. The City has used CDBG funds in the past on the Manufactured Home Park Program and the Housing Replacement Program. A Habitat for Humanity home was constructed in 1999 with CDBG funds as part of the Housing Replacement Program. Similar to cities throughout the Nation, the recessed housing market has impacted Mounds View’s housing stock. In January 2012, there were 115 foreclosed homes in Mounds View (source: Mounds View Housing Inspection/Code Enforcement). Of those 115 homes, 43 are vacant. Of those vacant/foreclosed homes, Mounds View City staff believes that there are several homes that should be demolished, rather than renovated. This is because the cost to renovate these homes would exceed the cost to rebuild.