Steve Cross wrote:

***But, the very existence of the 52.5% goal obviously means that 47.5% are
going to go to programs OTHER than the housing that is specifically
mentioned in the NRP law. Furthermore, that same NRP statute (469.1831,
Subd. 2) says that the program includes programs to "preserve and enhance
... public physical infrastructure." Therefore, spending money on Pratt was
clearly within the ambit of the law.***

Not to be nit picky as a lawyer--and I believe Steve is also a lawyer-- but
the law is not so clear.  The language quoted above from Subdivision 2
relates to "activities of a program," not to allowed expenditures, which are
covered in Subdivision 3.  The law is clear about the purpose of the program
and that allowed expenditures must go to a number of things, all of which
relate to acquiring, rehabilitating or constructing housing, blighted
properties, industrial properties, or commercial or retail properties.  The
subdivision 2 that Steve references is not applicable to expenditures, as
the statute goes on to say that funds must be "expended in accordance with
the program for a purpose listed in subdivision 3 [not subdivision 2] . . ."

There is a catch-all provision in subdivision 3 that states in whole that
funds may be used "to rehabilitate or construct community-based nonprofit
and public facilities necessary to carry out the purpose of the program,"
but that begs the question as to the purpose of the program and its
"qualifying costs," which are defined again in reference to the acquisition,
rehabilitation or construction of various listed properties, none of which
are specifically school related.

How Do We Get the 52.5 Percent Requirement?

According to the statute, the school district is to receive 15 percent of
all program monies--including TI funds-- specifically for "additional
education programs and services in accordance with the program."  The county
is to receive 7.5 percent of all program monies, and social services is also
to receive 7.5 percent.  Of the amounts left over after these payments, 75
percent of the money is to be used  for "housing programs and related
purposes."  Thus, voila, the 52.5 percent requirement for housing:  (100% of
funds, less the 30 percent to the county and to school district, leaves 70
percent of all funds; 75 percent of these remaining funds equals 52.5
percent of all funds).

My point is not to criticize Prospect Park's meeting and its decisions, but
to disagree with Steve's conclusion that the law is clear about allowed
expenditures, particularly when the school district is supposed to receive
15 percent of all program monies already, and up front.  Whether that has
happened in practice is another question (the statute says the monies must
be paid to the school district within 15 days of the city receiving them,
but I'm wondering if the school district foregoes this money and generally
just puts it in the pot with the understanding that it comes back to schools
in another way--like in the case of Prospect Park--but I doubt such a
payment scenario is legal, though).

Gregory Luce
St. Paul




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