Lifecycle Housing Joint Powers Agreement

The parties to this Agreement are governmental units of the State of Minnesota. This Agreement is made pursuant to the authority conferred upon the parties by Minnesota Statute §471.59 and §462.358.

1. General Purpose. The purpose of this Joint Powers Agreement is to establish a Board of Directors to organize and govern a community-based effort to provide affordable housing.

2. Definitions.

2.1 "Additional Member." A signatory of this Joint Powers Agreement who is not an Initial Member, having joined after the first year of existence.

2.2 "Board." The Board of Directors established by this Agreement.

2.3 "Director." A member of the Board of Directors.

2.4 "Initial Member." An original signatory of this Joint Powers Agreement as identified in Section 3.1.

2.5 "Life Cycle Housing Units." Owner-Occupied Life Cycle Housing Units and Rental Life Cycle Housing Units as defined in this Agreement.

2.6 "Member." Any city which is a signatory to this Agreement.

2.7 "Owner-Occupied Life Cycle Housing Units." Newly constructed units that

1. are sold only to households with annual incomes at or below 80% of the area median income and are sold at or below the Price Point established pursuant to this Agreement; or
2. are sold to anyone, regardless of income, if and only if the builder/developer has not received a written offer to purchase for a price equal to the Price Point from an income-qualified buyer before the end of a thirty day period beginning when the Service Provider receives notification from the builder/developer that construction framing has been completed.

2.8 "Price Point." The maximum price for which the builder or developer can sell an owner-occupied LCHU:

1. The Price Point is determined by the city in cooperation with the developer by means of the application of the Pricing Formula, approved by the Board.
2. The Price Point is incorporated in the development agreement between the city and the developer prior to final approval of the plat.

2.9 "Pricing Formula." A formula approved by the Board and applied by the city that generates the Price Point for an owner-occupied LCHU based on the particular features that the developer proposes to include in the LCHU(s).

2.10 "Rental Life Cycle Housing Units" are newly constructed rental units:

1. Whose maximum monthly rent is no greater than 30% of the monthly income of households earning 65% of the area median income, adjusted for the size of the unit, as specified and periodically updated by the US Department of Housing and Urban Development; and,
2. Which must be rented as LCHU's for a least the first 15 years of life of each unit.

3. Membership.

3.1 The Initial Members are: The Cities of Sartell, Sauk Rapids, St. Cloud, St. Joseph and Waite Park.

3.2 No change in governmental boundaries, structure, organizational status of character will affect the eligibility of any Member listed above to be represented on the Board as long as such Member continues to exist as a separate political subdivision.

4. Board of Directors.

4.1 The community based effort to provide affordable housing set forth in this Agreement must be governed by a Board of Directors which must consist of one Director appointed by the governing body of each Initial Member listed in Section 3.1 above. Each Member may designate an alternate for its appointed Director. Each Director and alternate must be a member of the governing body of their respective Member.

4.2 Directors must serve without compensation from the Board. This does not prevent a Member from providing compensation to a Director for serving on the Board.

5. Quorum/Voting.

5.1 A majority of all of the Directors will constitute a quorum. A simple majority vote of the Directors present at a meeting with a valid quorum is required for the Board to take action, unless otherwise provided by law.

5.2 There is no voting by proxy. Except as otherwise authorized in this Agreement, all votes must be cast by the Director or designated alternate at a Board Meeting. Each Director shall have one vote.

6. Officers.

6.1 The officers of the Board will be a Chair and a Vice-Chair.

6.2 At its first meeting, the Board must elect a Chair and a Vice-Chair who will serve through December 31 of the year when first elected and until a successor is elected. At the meeting prior to completion of the initial term(s) and at the completion of every term thereafter, a Director must be elected to each respective office for a two-year term.

6.3 A Director must be elected in the same manner as above to fill out an unexpired term of any office which becomes vacant.

7. Meetings.

7.1 The Board must meet at least annually on a schedule determined by the Board.

7.2 Meetings of the Board may be called by the Chair and must be called upon written request of a majority of the Directors.

7.3 All meetings must be conducted in compliance with the Minnesota Open Meeting Law, Minnesota Statutes Chapter 13D.

8. Powers and Duties of the Board.

The powers and duties of the Board are limited to the following:

8.1 Established and periodically update the Pricing Formula for the sale of owner-occupied Life Cycle Housing Units (LCHUs) following consultation with the Life Cycle Housing Committee established in Section 8.8 of this Agreement.

8.2 Designate and enter into an agreement with a Service Provider(s) to apply for and administer funds for gap loans or other financial assistance, conduct homeowner education and certify prospective buyers as income-eligible, work with area lenders for mortgage pre-approval of prospective buyers in the gap loan program, work with employers to assist workers to save for housing expenses through payroll deductions or other programs, inform prospective buyers on the waiting list about various LCHUs becoming available for sale, assist in the resale of homes during the 20-year period of long term affordability conditions, and administer the Life-Cycle Housing Fund in accord with policies of the Board. Any agreement with the designated Service Provider(s) must require that all loans to qualified households:

1. Be repaid with interest upon sale of the LCHU.
2. Require that the original buyer and all subsequent owners of such an LCHU, during the first ten years of life of the LCHU, can sell the unit only:
   1. To a household with annual income less than 80% of the area median income, and
   2. For no more than the purchase price the seller paid for the unit plus an inflationary increase, defined as the percent increase in the purchase price equal to the rise in the Consumer Price Index over the time that has elapsed since that purchase; plus the fair market value of any capital improvements made since the seller bought the LCHU.
3. Require that the original buyer and all subsequent owners of such LCHU, at the time the LCHU is first sold during the second ten years its life:
   1. Can sell the unit at any price to any buyer regardless of income, but the seller can retain only the purchase price the seller paid for the unit, plus the inflationary increase, defined as a percent increase in that purchase price equal to the rist in the Consumer Price Index since the time of that purchase, plus the fair market value of any capital improvements made since the seller bought the LCHU; plus one half of the difference between the sale price and the sum of (i) the purchase price plus (ii) the inflationary increase plus (iii) the fair market value of any capital improvements. That part of the sale price beyond this total retained by the seller will be paid by the seller into the Life Cycle Housing Fund, administered by the Service Provider in accord with policies of the Board.
4. After such an LCHU is sold during the second 10 years of its life, or after the twentieth year of age of the LCHU, or at the time of any default on a mortgage on an LCHU, whichever comes first, all restrictions on resale will cease.

8.3 Receive reports from Members in respect to their efforts to meet affordable housing goals.

8.4 Annually report to Members on Board activities and progress in meeting affordable housing goals.

8.5 The Board may research and make recommendations to the Members regarding matters related to the purpose of this Agreement.

8.6 The Board may consult with persons knowledgeable in affordable housing such as research organizations, educational institutions, other political subdivisions, and any other persons who can provide pertinent information.

8.7 The Board's reports and records will be available for and open to inspection by its Members at all reasonable times. The Board's records shall be available for inspection by the public pursuant to Minnesota Statues, Chapter 13.

8.8 The Board may appoint such committees as it deems necessary to exercise the powers of the Board in accordance with by-laws adopted by the Board and as allowed by law. The Board will create a Life Cycle Housing Committee to advise the Board in addressing the area affordable housing needs. The Life Cycle Housing Committee will include the following participants:

One member appointed by each Member;
One member appointed by the Central Minnesota Builders Association;
One member appointed by the Service Provider;
One member appointed by the Board to represent orgranizations specializing in the development/construction of affordable housing;
One member appointed by the Board to represent area realtors;
One member appointed by the Board to represent area bankers;
One member appointed by the Board to represent the public.

8.9 The Board may exercise all other lawful powers neccessary and incidental to the implementation of the purposes and powers set forth herein, including, without limitation, the adoption of by-laws to govern the functioning of the Board, provided that no by-law or action of the Board will be contrary to the terms of this Agreement.

8.10 The Board may receive petitions for termination of this Agreement from Members. Upon receipt of a petition of a Member the Board must conduct a public hearing. The Board must provide a minimum of 30 days notice in writing to the City Administrator/Manager of each Member and by publication in a newspaper of general circulation in Member cities. Upon a 2/3 vote of all Directors acting upon a resolution of the Board, the Board must recommend termination of this Agreement. A copy of the resolution must be submitted to the City Council of each Member and if ratified by 2/3 of the Members, the Board must terminate this Agreement, allowing reasonable time to complete work in progress.

8.11 The Board may receive petitions for amendment of this Agreement from Members. Amendments may be initiated upon petition of a Member or by the Board upon its own motion. Upon initiation of an amendment the Board must conduct a public hearing. The Board must provide a minimum of 30 days notice in writing to the City Administrator/Manager of each Member and by publication in a newspaper of general circulation in Member cities. Upon a majority vote of all Directors acting upon a resolution of the Board, the Board must recommend amendment of the Agreement. A copy of the resolution must be submitted to the City Council of each Member and if ratified by all Members will become effective.

9. Additional Members.

9.1 Other cities may become a party of this Agreement upon a 2/3 majority of all Directors acting upon a resolution of the Board. The new Member shall sign a copy of this Agreement, Existing Members shall not be required to resign.

9.2 Members joining after the first year of this Agreement will be full Members, will be entitled to appoint a Director to the Board, and will have all the other rights and privileges of Membership.

10. Employees.

10.1 Employees of the member Cities serving as a Director or providing administrative services will not be considered employees of the Board for any purpose including, but not limited to, salaries, wages or other compensation of fringe benefits; workers' compensation; unemployment compensation or reemployment insurance; retirement benefits; social security; liability insurance; keeping of personnel records and termination of employment.

11. No Payment of Assisting Staff.

11.1 No Member will be responsible or liable to any other Member for the payment of wages or other renumeration of the other Member or to the other Member's employee(s), notwithstanding the fact that such employee may from time to time pursuant to this Agreement, provide services which benefit the other.

12. Duration and Amendment.

12.1 This Agreement will continue indefinitely unless terminated as provided herein.

12.2 This Agreement may be amended by the unanimous agreement of all Members in accordance with the provisions of Section 8.10 above.

13. Termination.

13.1 This Agreement may be terminated by the written agreement of 2/3 of the Members. Any Member may petition the Board to terminate this Agreement.

13.2 Unless the Board has decided upon other arrangements authorized under state statute, upon termination of this Agreement, all monies on hand, shall be distributed to the current Members. Such distribution of assets must be made in proportion to the total contributions by the respective Members over the entire duration of this Agreement. The Board will continue to exist after termination for such period, no longer than six months, as is necessary to wind up its affairs but for no other purposes.

14. Withdrawl.

14.1 A Member may withdraw from this Agreement, by resolution of its city council, provided that the member gives a 120-day notice to the Board and the other Members.

15. Members Pledge.

15.1 The members pledge that each will work with area developers to ensure that 15% of the combined total number of owner-occupied and rental housing units, taken together, built in each city will be Life Cycle Housing Units (LCHUs).

15.2 Each member is free to employ whatever methods it judges to be most effective in meeting this 15% commitment.

15.3 During the first five years of this Agreement, each city's commitment will be that the number of LCHUs built since January 1 following the Effective Date of the Agreement (as defined in Section 18.1) represent at least 15% of the total number of residential units built during that same time period. In the sixth and later years of the Agreement, the 15% commitment is measured by the residential construction that occurred during the three most recent years.

15.4 Each Member will issue a written report by February 15 of each year to the Board addressing:

1. The results of this commitment over the previous calendar year,
2. The results anticipated for the current year, and
3. For any member which has not met the 15% commitment by the end of the second or any subsequent year of the Agreement, a description of the member's plan for the coming year for meeting that commitment.
4. So that all members can learn from the successes of others, the annual report should include a summary of the methods employed by the city in their efforts to achieve the 15% commitment.

15.5 Each Member will actively participate in the Board's Life Cycle Housing Committee.

15.6 Each Member will move to adopt some form of a mandatory ordinance if that Member's 15% commitment is not achieved under this Agreement by a date five years after the approval of this Agreement or sooner if deemed necessary by the Member. Subsequent to the first five years of this Agreement, the city will take the same action if the three year moving average of LCHUs identified in Section 15.3 above falls below 15% for two successive years. However, if the failure to reach the 15% commitment is due to the lack of funds for loans or administrative expenses of the Service Provider, then there will be no commitment to move to a mandatory ordinance.

15.7 Each Member will work together and through area Housing and Redevelopment Authorities to seek funding for and administer a program of rehabilitation loans to refurbish older homes.

16. Indemnification.

16.1 Each Member agrees to fully indemnify and hold harmless the other Members against all claims, losses, damage, liability, suits, judgements, costs and expenses by reason of the action or inaction of its designated Director, alternate Director or employees assigned to assist the Board. This agreement to indemnify and hold harmless does not constitute a waiver by any member of limitations on liability provided by Minnesota Statutes, Chapter 466.

17. Indemnification.

17.1 If any portion of this Agreement is found to be void, unenforceable, unconstitutional, or any combination of these, by a court of competent jurisdication, the remaining portions of this Agreement shall remain in effect.

18. Effective Date.

18.1 This Agreement shall be in full force and effect when all members sign this Agreement. All members need to sign the same copy. Each member shall file the signed Agreement with the City Administrator of Sartell, who shall notify all members of the effective date of the Agreement.