Housing and Redevelopment Authority

Bloomington Housing & Redevelopment Authority Commission Approved Minutes Housing And Redevelopment Authority Tuesday, November 25, 2025 Council Chambers Bloomington Civic Plaza 1800 W. Old Shakopee Rd. Bloomington, MN 55431 6:00 P.M. Webex Virtual Meeting CALL TO ORDER Chair Jennifer Mueller called the HRA Board meeting to order at 6:03 p.m. HRA Commissioners Present: Chair J. Mueller, Commissioner R. Wooten (present on Webex), V. Hoogheem, B. Doblinger, and C. Moua. Staff Present: Sarah Abe, HRA Administrator Anna Salvador, HRA Assistant Administrator Melissa Manderschied, City Attorney (present on Webex) Maricruz Hernandez, Program Specialist I Mike Palermo, HRA Assistant Administrator Jeff Bots, Accountant Also Present: Rachel Tierney, Kennedy and Graven Alex Franks, Owner of Magnolia Homes, LLC Dalton Outlaw, President of Outlaw Development, LLC. Staff Absent: Commissioners J. Carter, and S. Isse. APPROVAL OF AGENDA Item 2.1 Approval of November M/Moua, S/Hoogheem, and all present HRA Commissioners voting aye, motion to 25, 2025, Agenda approve the November 25, 2025, agenda. Motion passed 5-0. Agenda approved. CONSENT Item 3.1 October 28, 2025, HRA M/Hoogheem, S/Moua, and all present HRA Commissioners voting aye, motion to Board Meeting Minutes approve the October 28, 2025, HRA Board Meeting Minutes. Motion passed 4-0-1 abstention by R. Wooten. ORGANIZATIONAL BUSINESS Item 4.1 Page 1 of 8  Bloomington Housing & Redevelopment Authority Commission Approved Minutes HRA Owned Rental Salvador presented a request for authorization for staff to enter into an Emergency Properties 2026-2027 Maintenance Agreement with Tuk Technical LLC for the City’s rental properties. The Emergency Maintenance proposed agreement would be for a one-year term beginning January 1, 2026, with an option to extend for an additional year. The total contract amount would not exceed Contract $200,000. Tuk Technical LLC was selected through a competitive Request for Proposals (RFP) process and received the highest overall evaluation score based on criteria including cost, qualifications, and proposed approach. Their application stood out due to their extensive experience working with rental properties, particularly within the affordable housing sector. The selection committee was especially impressed with Tuk Technical’s proposed onboarding process, their approach to emergency maintenance work, and their well-established reporting framework, which will support staff in staying informed when emergencies occur. Salvador concluded the presentation and returned the item to the Chair for questions or comments. Commissioner Wooten asked how the contract amount was determined, specifically referring to the proposed total of $200,000. In response to Commissioner Wooten’s question about how the contract amount was determined, Salvador explained that the $200,000 total aligns with the 2026 budget for emergency maintenance across both the Assisted Rental and Rental Homes programs. This amount represents the maximum anticipated need for the upcoming year. Commissioner Wooten then asked whether the temporary company that had previously provided services submitted a bid. Salvador noted that they could not disclose the names of any proposers due to the closed bidding process but confirmed that a total of four proposals were received through the RFP process. Commissioner Wooten also inquired about the reporting process related to emergency maintenance activities and how information would be shared with staff and the Board. Salvador responded that, in the event of an emergency situation, real-time updates would be provided to staff as incidents occur. Additionally, monthly reporting from the contractor would outline actions taken to address emergencies. A summary of maintenance activities would continue to be presented to the Board during the annual maintenance update provided each summer. Commissioner Wooten requested that the Board receive quarterly updates to better track contractor performance, given prior challenges. Salvador agreed that quarterly updates could be explored and incorporated into next year’s reporting timeline. M/Doblinger, S/Wooten, and all present HRA Commissioners voting aye, motion to approve a HRA Owned Rental Properties 2026-2027 Emergency Maintenance Contract. Motion passed 5-0. Item 4.2 Page 2 of 8  Bloomington Housing & Redevelopment Authority Commission Approved Minutes Bloomington Affordable Assistant HRA Administrator Mike Palermo provided an overview of the Bloomington Homeownership Affordable Homeownership Program. He explained that this initiative is being funded Program Pilot Selection primarily through a $3.19 million grant from Minnesota Housing, along with additional local sources, to support the development of 27 owner-occupied homes. The goal is to of Developers complete all units by March 2027. Homes will be affordable to households earning up to 80% of the Area Median Income. Palermo noted that the HRA has several vacant, developable lots, some previously identified for partnership with Habitat for Humanity. An RFP for additional developers was released in October and closed on November 5. He highlighted that the evaluation process focused on applicants’ ability to deliver projects on time and within budget, given the tight timeline and potential need for supplementary funding. Proposals were also assessed for compliance with Minnesota Housing Impact Fund requirements, including visibility standards, Enterprise Green Communities sustainability standards, and potential prevailing wage requirements. Following review and interviews, the selection committee recommended awarding development of two larger lots—10117 First Avenue and 8935 Stevens Avenue South, which can each accommodate a two-family home—to Magnolia Homes LLC. Two smaller lots—8313 Grays Dale and 1210 West 82nd Street, suitable for single-family homes— were recommended for Outlaw Development LLC. Next steps include entering negotiations and drafting development and purchase agreements with both developers. A public hearing will be held at a future meeting prior to the conveyance of any HRA-owned land, as required. Palermo presented a suggested motion to approve the selection of the recommended developers. Commissioner Moua asked staff to clarify the 80% Area Median Income (AMI) level for Bloomington. Staff responded that for a family of four, 80% AMI is approximately $115,000, noting that this reflects typical household incomes for the neighborhoods where the lots are located. Commissioner Moua invited the developers present to share their interest in the project and their relevant experience. Alex Franks, Magnolia Homes LLC, introduced himself and explained that his work focuses on creating attainable “missing middle” housing. He has partnered with the City of Minneapolis through the Minneapolis HOMES program on twin homes and other small- scale projects, and is also active in Golden Valley through the HOPE program. Mr. Franks expressed interest in expanding this work in Bloomington, noting that he also trains emerging developers and looks forward to continuing that work as part of this initiative. Dalton Outlaw, Outlaw Development LLC, introduced himself and shared that he and his business partner have more than 15 years of combined development experience, specializing in small-scale, single-family projects in St. Paul. They recently completed two Page 3 of 8  Bloomington Housing & Redevelopment Authority Commission Approved Minutes duplexes funded through the Impact Fund, both sold to owner-occupant households within 12 months. Mr. Outlaw expressed appreciation for the opportunity to support Bloomington’s affordable housing efforts and emphasized their commitment to mentoring emerging developers. Commissioner Hoogheem asked staff about future updates on program progress. Palermo stated that updates will be provided throughout each phase of the project. The combined Habitat for Humanity and developer-selected phases will produce approximately 12 units, with more phases to follow. Palermo also noted that signatures for the Habitat lot sales are expected soon and that commissioners may have opportunities for site tours as construction proceeds. Commissioner Moua asked how the city secured state funding for the program. Palermo explained that Bloomington applied for Minnesota Housing’s Impact Fund in 2023, identifying approximately 27 feasible units across several City-controlled lots. The grant is competitive and intended to help fill development funding gaps, given that total development costs exceed the eventual sale price of the homes. Palermo acknowledged that internal staffing transitions temporarily slowed progress, but work is now moving forward. Commissioners thanked staff for successfully obtaining state funds and ensuring that state tax dollars return to Bloomington to support local affordable housing needs. Item 4.2 2026 Budget and Final The Chair opened the discussion on the 2026 Budget and Final Levy. The Chair noted that Levy Discussion public testimony would not be taken during the meeting; however, community members are encouraged to submit written comments for inclusion in the official public record. Sarah, HRA Administrator, presented the staff report and an overview of the 2026 proposed budget and levy. She summarized the following key points: • The HRA previously approved the preliminary levy of $3,298,465, the maximum amount allowed, at the August 26 meeting, with additional discussion held in October. • A primary topic of discussion has been the potential federal budget cuts to major housing programs that support the majority of the HRA budget. • The goal for the evening was to adopt the final 2026 budget and levy, which will be forwarded to the City Council for final approval. Budget Overview • The total 2026 proposed budget is $11.7 million, of which $3.2 million is levy- supported. The remaining revenue primarily consists of federal funding, rental income, and grants. • Approximately $7.5 million in federal funding is allocated annually through the Housing Choice Voucher (Section 8) and Community Development Block Grant (CDBG) programs. • The total budgeted increase for 2026 is 13.6%, which includes increases in both revenue and expenditures. Page 4 of 8  Bloomington Housing & Redevelopment Authority Commission Approved Minutes • Staff noted that HRA programs continue to leverage significant outside funding, including state grants, federal programs, rental income, and a recent $2.6 million state-funded voucher award. Cost Efficiencies and Program Adjustments Staff highlighted several cost-saving and efficiency strategies, including: • Leveraging City resources such as finance, communications, and legal services. • Bringing property management in-house, which improved service quality at similar cost. • Streamlining contracts through competitive RFP processes. • Pausing certain programs, such as rehab loans, when funds were at capacity. • Completing priority-based budgeting and cross-training staff to support high- demand programs such as Housing Choice Vouchers. Federal Funding Context • Staff reported that Congress passed a continuing resolution extending 2025 funding levels through January 30, 2026. • Although current federal proposals show minor reductions, changes to related programs—such as Continuum of Care funding administered by the County—may impact Bloomington residents. • HRA is coordinating with the County regarding potential impacts to residents who depend on rental assistance funded through these programs. Rationale for Levy Increase Staff outlined reasons for maximizing the levy: • Increased property maintenance costs and deferred maintenance following the COVID period. • Continued investment in affordable housing, including Opportunity Housing Ordinance projects. • Expanding strategic partnerships and service contracts that provide housing navigation and other supportive services. • Strengthening the development fund balance to support long-term housing initiatives. Revenue and Allocation Summary Staff provided charts illustrating: • Revenue sources, showing the distribution between federal funding, levy funds, and other revenue. • Expenditure categories, with Section 8 as the largest program area. • How levy dollars are allocated across HRA programs. Next Steps • The HRA levy is scheduled for City Council consideration on December 8, the same date as the Truth in Taxation public hearing. • The City’s final levy approval is expected on December 15. • The approved budget must then be submitted to Hennepin County. Page 5 of 8  Bloomington Housing & Redevelopment Authority Commission Approved Minutes Recommended Action Staff presented two levy options for consideration: 1. Maximum levy of $3,298,465, restoring pre-2023 levy levels and supporting long- term investments. 2. A reduced levy option of $2,769,133 that would decrease strategic initiative capacity. Staff requested the Board adopt a final levy and budget for 2026. Commissioner Hoogheem asked for clarification regarding recent news reports about federal funding cuts. She asked whether the discussion referenced the State of Minnesota’s response to federal HUD cuts affecting permanent supportive housing. Abe confirmed that the reference was aligned with recent reporting, including an NPR article noting that the changes could impact approximately 5,000 Minnesotans statewide. Commissioner Moua reiterated his continued advocacy for adopting the lower levy option. He noted that the City Council has asked all departments to consider reductions and stated that residents are struggling now. He acknowledged the strong work of staff in securing outside funding and bringing resources back to Bloomington but emphasized he belief that the lower levy still allows the HRA to meet its commitments while maintaining affordability for residents. The Chair reminded attendees that public testimony could not be taken during the meeting because this item was not noticed as a public hearing. Community members were encouraged to attend on December 8, where public comment would be accepted. Commissioner Hoogheem stated for the record that the HRA has maintained the lowest levy levels for the past few years and has made sacrifices to reduce costs. She recommended staff for securing external resources and encouraged other City bodies to pursue similar efforts. She added that while she is open to compromise, it is also important to invest responsibly for the future and avoid deferring costs to future generations. Commissioner Wooten stated that he has consistently supported not increasing the levy and remains opposed to raising it. Abe restated that the resolution as written reflected the higher levy option. To adopt a different amount, commissioners would need to specify the alternative amount in their motion. Motion 1: Commissioner Dollinger moved to adopt the higher levy recommendation of $3.2 million. The motion failed for lack of a second. Motion 2: Commissioner Wooten moved to adopt the alternative levy option in the amount of $2,769,133, with a corresponding reduction to the overall 2026 annual budget. Page 6 of 8  Bloomington Housing & Redevelopment Authority Commission Approved Minutes Commissioner Hoogheem seconded the motion. Legal counsel clarified that the motion should explicitly reflect both the alternative levy amount and the corresponding budget adjustment. The Chair restated the motion for clarity: • Approve the resolution authorizing a special benefit tax levy of $2,769,133, and • Approve a corresponding reduction to the total 2026 annual budget consistent with the alternative levy amount. M/Wooten, S/Hoogheem, and all present HRA Commissioners voting aye, motion to approve A RESOLUTION AUTHORIZING THE FINAL LEVY OF A SPECIAL BENEFIT TAX LEVY PURSUANT TO MINNESOTA STATUTES, SECTION 469.033, SUBDIVISION 6 AND APPROVAL OF BUDGET FOR FISCAL YEAR 2026. Motion passed 5-0. NEW BUSINESS DISCUSSION ITEMS Item 6.1 The HRA Administrator provided the following updates to the Board: HRA Administrator Updates • Introductions: Rachel Tierney from Kennedy & Graves, the HRA’s new General Counsel selected through the RFP process, was introduced. Her contract was approved at the previous meeting. Jeff Botts, the new accountant replacing the former HRA accountant who departed in August, also joined the team earlier this month. • Emergency Maintenance Provider: In response to Commissioner Wooten question, the Administrator confirmed that the names of RFP respondents is public per Statute and that the current emergency maintenance provider did submit an application during the selection process. • Upcoming City Council Items (December 8): o Several items related to the HRA will be on the consent agenda and public hearing, including the CDBG/CDBG-COVID funds public hearing. This pertains to federal dollars allocated during COVID for improvements to HRA-owned properties, requiring an amendment to the annual action plan approved in 2020. o Annual contracts going to City Council include the staff services contract, the CDBG mutual agreement, and the 2026 levy amount recently approved by the HRA. • St. Mark’s Property Acquisition and Redevelopment: The Administrator noted an issue with the cell tower site plan, which is under dispute. Efforts are ongoing to reach a resolution. The contingency date for this project has been extended Page 7 of 8  Bloomington Housing & Redevelopment Authority Commission Approved Minutes through the end of the year, which may slightly delay plans. • Next HRA Meeting: The final HRA meeting of the year is scheduled for December 9, and commissioners should anticipate a longer agenda. Commissioner Wooten inquired about the status of the HOA parking structure project. The Administrator responded that notices were issued for winter parking. The building permit was approved this week, and construction is expected to begin soon. The first step will be demolition of the existing structure, with construction of the new structure anticipated in the spring. There may be minimal activity over the winter following demolition. Commissioner Hoogheem requested an introduction to the new City Manager at an upcoming meeting. The Administrator confirmed that this is on the City Manager’s onboarding list and that an introduction will be scheduled in the future. ADJOURNMENT M/Hoogheem, S/Moua, and all present HRA Commissioners voting aye, motion to adjourn the November 25, 2025, HRA board meeting at 6:58 pm. Motion passed 5-0. Maricruz Hernandez, HRA Meeting Minute Secretary Page 8 of 8