The Clinton Herald, Clinton, Iowa

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April 27, 2013

City seeks non-profit to distribute funds

CLINTON — The city of Clinton is considering a partnership with a local non-profit to help distribute low-to-moderate-income housing funds.

The money is generated by economic development agreements the city already has. Every time the city issues a tax increment financing development agreement for a residential development, a certain amount is withheld if the development does not meet low-to-moderate-income (LMI) quotas.

The city has set up an low-to-moderate-income fund, which should reach $250,000 by the end of this fiscal year.

“We have this money and we need to figure out how to use it. Basically we need some direction of who we want to talk to,” City Attorney Jeff Farwell told City Services Committee members during their Wednesday meeting.

The Van Allen building is the only development agreement the city has that serves LMI individuals. Two other development agreements, Mill Creek Highlands and Mill Creek Crossings, did not serve LMI housing needs.

According to a memo from Interim City Administrator Jessica Kinser, the city will collect LMI funding from the Mill Creek Crossing development for the next 16 years, providing a steady stream of money for future LMI projects.

The funds can be used to provide lots or construct LMI housing, give grants, credits or other direct assistance to LMI families within the city or to pay into an LMI housing fund established by the city to be used for one of those purposes, including matching funds for any state or federal money used for the same purposes.

The city’s fund has only been used once as a match for a community development block grant for housing. The city planned to use the funds this fiscal year for a homeownership assistance program for LMI individuals, but not enough people applied and the grant funds were turned down.

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