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St. Paul HRA approves settlement to fund $86,372 repairs, discharge prior $33,230 forgivable rehab loan
Summary
The St. Paul Housing and Redevelopment Authority voted to approve a settlement with homeowners Ray and Carolyn Collins that discharges an earlier forgivable rehab loan and provides funds to correct deficient work at the property.
At a meeting of the St. Paul Housing and Redevelopment Authority, the board voted 6-0 to approve a settlement agreement with Ray Collins and Carolyn J. Collins that will discharge an existing forgivable loan and provide funds to correct defective rehabilitation work at the homeowners’ property.
The settlement resolves claims tied to a rehab loan the Collinses received to pay a contractor for work at their home. Director Newton told commissioners the original forgivable loan amounted to $33,230 and that third‑party inspection and other reviews found the contractor’s work to be deficient and, in part, outside the scope of permitted work.
The agreement will discharge the original $33,230 loan and provide the homeowners $86,372, the amount the parties identified as necessary to hire a new contractor to fix the deficiencies based on multiple bids. Director Newton described the item as “a settlement item which we don't have often and we don't like to have, but occasionally things don't go the way that we we like.”
The presentation to commissioners emphasized that the settlement places the homeowners “in a position they would have reasonably expected to be in if the work had been completed satisfactorily,” but that neither the HRA nor the City will have responsibility to ensure the corrective work is actually performed. According to the terms described by staff, enforceability of the agreement does not depend on the homeowners spending the funds on repairs, and the HRA and City have no obligation to provide additional compensation beyond the settlement amount.
Staff recommended funding the settlement from the HRA general fund, and the commission adopted the resolution by a recorded tally of 6 in favor, 0 opposed.
The resolution (RES 25-51275) and related documents were presented as a discussion item during the meeting; Commissioners Provatsky moved approval. The minutes and staff memo note that Commissioner Buie was excused and Commissioner Kim was expected to join later in the session.
