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Memorandum <br />To: Hugo City Council <br />From: Rachel Juba, Community Development Director <br />Date: February 26, 2025, for the City Council meeting of March 3, 2025 <br />Re: Approve Agreement with Washington County for Local Affordable Housing Aid Fund <br />Administration <br />1.BACKGROUND: <br />In 2023 and 2024, the Minnesota Legislature authorized aid payments to counties, cities and <br />Tribal Nations to support affordable housing. The goal is to fund affordable housing projects <br />and help organizations provide affordable and supportive housing. LAHA is funded by a 0.25% <br />sales tax on the seven-county metropolitan area. Aid is appropriated directly to cities, counties, <br />and tribal governments based on cost-burdened households. The city distribution factor is the <br />number of households in a city that are cost-burdened divided by the total cost-burdened <br />households in eligible cities. A “cost-burdened household” is one in which the gross rent is 30 <br />percent or more of household income or in which homeownership costs are 30 percent or more <br />of household income. The funds are required to be spend by December 31 in the third year <br />following the year after aid was received. The City will receive LAHA as long as the sales tax is <br />collected <br />Below are the aid allocations Washington County communities received in 2024: <br />Community LAHA$ 2024 <br />Washington County $2,718,767 <br />Woodbury $301,991 <br />Oakdale $178,744 <br />White Bear Lake $152,906 <br />Cottage Grove $125,476 <br />Forest Lake $118,579 <br />Hastings $114,387 <br />Stillwater $94,704 <br />Hugo $59,740 <br />Lake Elmo $48,811 <br />Allocations for 2025 have not been released. <br />G <br /> <br />.12