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Council Meeting Minutes Goal Workshop on January 27, 2025 <br />Page 2 of 4 <br /> <br />projects through a 0.25% sales tax in the seven-county metropolitan area. Funds are allocated <br />based on the number of cost-burdened households within each city and must be spent within four <br />years of receipt. Hugo received its first installment of $59,740 in July 2024. <br />Juba outlined the types of projects that qualify for LAHA funding saying there are extensive <br />stipulations associated with the program. Currently, Hugo does not have a housing policy <br />dedicated to affordable housing projects or a housing agency to oversee such initiatives. <br />However, the City could develop programs that align with LAHA requirements to utilize the <br />available funding. Historically, Hugo has collaborated with the Washington County Community <br />Development Agency (CDA) to support affordable housing efforts. <br />A bill passed by the state legislature requires counties to engage with cities in administering the <br />LAHA program at no cost. Hugo has several options for utilizing these funds. The City could <br />transfer the money directly to the Washington County CDA, allowing them to allocate it at their <br />discretion, or it could contract with the County to ensure that LAHA funds are used specifically <br />for projects within Hugo. In this case, the County would collaborate with the City on project <br />selection while also handling tax documentation and reporting requirements to the state. <br />Additionally, Hugo has the option to approve the use of its funds for affordable housing projects <br />outside City limits as part of a larger regional effort. Any unspent funds would need to be <br />returned. <br />City staff expressed confidence in Washington County’s ability to administer LAHA funds <br />effectively, given their experience conducting housing studies and understanding Hugo’s specific <br />needs. The Council discussed the potential administrative burden on the City if it were to <br />manage these funds independently. The Council expressed interest in using LAHA funds to <br />subsidize loans and implement targeted programs to address specific community needs. Staff <br />will work with Washington County to draft an agreement for Council approval. <br />Rental Housing <br />The adoption of a rental housing ordinance was initially discussed in 2009 during the recession, <br />prompted by concerns over foreclosures, crime, and property maintenance. The proposed <br />ordinance primarily required rental properties to be registered, but it was never approved. The <br />topic has resurfaced due to a recent issue with tenants in a rental unit and the overall increase in <br />rental properties within the City. <br />Community Development Director Rachel Juba outlined the benefits and challenges associated <br />with rental housing, including property conditions, increased crime rates, and the eviction <br />process. The City could adopt rental housing ordinance that could require rental licensing, <br />property inspections, and a maintenance code. The ordinance could include revocation of a <br />landlord’s license, compelling them to address property issues, including initiating eviction <br />proceedings. However, the eviction process remains a lengthy procedure governed by state law. <br />Juba provided information on what other cities did regarding rental housing including the <br />requirement for additional staffing. Currently, the City monitors rental housing ownership <br />through Washington County property owner database and utility billing records. Hugo receives <br />relatively few complaints regarding rental properties.