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City to forfeit DHCD tax-sale rehab grant now, plans to reapply under new terms
Summary
City staff told the council the 2021 DHCD tax-sale acquisition/rehab grant is being forfeited because the city is not ready to use the funds; staff will seek formal council approval next week to forfeit and reapply and has begun a test right-of-redemption on one property.
City staff said on Dec. 9 that the city will forfeit a state Department of Housing and Community Development (DHCD) tax-sale acquisition and rehabilitation grant awarded in 2021 and intends to reapply under updated terms.
Amanda Gregg (staff) briefed the council and said DHCD recommended forfeiture and reapplication after staff discussed a modification and an extension. "We're honestly not ready to use these funds quite yet," Amanda Gregg said, describing staff's view that forfeiture and reapplication under new stipulations is the appropriate path.
The council was told the city attorney has filed for a first right of redemption on one property, 134 Clarkson, as a test case; staff will proceed carefully to ensure legal notices and service are handled according to law. Gregg said the DHCD window for reapplication is anticipated in late spring to early summer next year.
Staff prefaced the forfeit-and-reapply approach by noting prior attempts to modify the grant terms; they plan to return to the council next week with a formal request to authorize forfeiture and reapplication. No formal forfeiture vote occurred Dec. 9.
The DHCD grant was originally intended for tax-sale acquisition and rehabilitation. Staff said there are roughly 23 properties related to the program; the city attorney is processing redemption notices to verify the process before proceeding with the broader set of properties.
