St. Paul HRA to add Westside Flats descendants to inheritance bonuses; names DPA and rehab guideline changes

The St. Paul Housing and Redevelopment Authority on Dec. 4 heard staff proposals to add Westside Flats descendants to inheritance-fund bonus layers for both down payment assistance and homeowner rehabilitation and to clarify several program rules before bringing the guidelines back for adoption next week.

City staff said the Rondo inheritance-fund structure will be expanded to include descendants of households displaced from the Westside Flats area and to add West Side Planning District 3 as eligible for a $10,000 community-wealth bonus. “We were able to get through the entire down payment assistance wait list of 776 households,” said Dean Porter Nelson, homeownership and rehab supervisor, who led the presentation. Staff said the program layers can add up to $110,000 for an eligible applicant who qualifies for every single layer.

The changes are presented as housekeeping adjustments and targeted equity additions: staff intends to make the homeowners-insurance requirement explicit in the guidelines and to update the loan-forgiveness schedule to align with Community Development Block Grant (CDBG) requirements. Under the clarified policy, the forgiveness period remains 15 years, but borrowers who leave the home in years 1–5 will not receive forgiveness; forgiveness would then accelerate in years 6–15 (staff described it as roughly 1/10 per year rather than 1/15). Porter Nelson said the change reflects current practice required by CDBG funding.

Staff also recommended increasing the minimum homeowner-rehab award from $1,000 to $5,000 to reduce administrative burden on small emergency loans. Program results presented at the meeting showed 60 homeowner-rehab loans closed with about $1,700,000 total loan value and an average loan of around $30,000, with three inheritance-fund borrowers included (two eligible up to $55,000 and one up to $80,000). Commissioners were told roughly 100 borrowers remain on the homeowner-rehab wait list as staff continues processing scopes and bids.

On timing, staff said they intend to reopen down payment assistance applications in early 2025 subject to final guideline approval in December and budget confirmation. A commissioner asked whether staff could reopen as soon as Jan. 2, 2025; staff said they will confirm a firm start date but intend to open as soon as feasible in early 2025. Commissioners urged clear public-facing materials and outreach—especially to highlight the addition of Westside Flats to the program—so residents know the expanded eligibility.

Staff emphasized implementation challenges beyond staffing, including contractor bidding and work schedules for rehab projects; they said administrative changes and potential outsourcing are being explored to manage demand. Staff will return next week with the final guideline amendments for HRA action.

The HRA laid over the separate 2025 HRA budget and tax-levy certification item for one week to align with the city budget process; that vote was procedural and carried unanimously.