RENTAL REHABILITATION PROGRAM FACT SHEET
Carlton County Small Cities Development Program 2008
Carlton County is requesting grant funds for owners interested in improving their rental units from the
Minnesota Department of Employment and Economic Development Small Cities Development Program
(SCDP).
• This assistance to owners is in the form of a deferred 10-year loan which must be matched with
other funds to complete the project. The match of funds must be 25% of the total cost of
improvements, SCDP funds will only pay for 75% of the total cost of improvements.
• The maximum available through the SCDP is $12,500 per unit.
• The SCDP loan is repaid to the county if the property is sold; title is transferred, or conveyed within
10 years of the loan closing. The obligation to repay is reduced by one-tenth of the original loan
amount after each of the years. If after 10 years the property is still owned by the borrower, the loan
is forgiven.
To qualify -
o Building must be in Carlton County
o You must be an owner of the rental unit, either free of debt, through a mortgage or recorded
Contract for Deed. *If you are buying the property on a Contract for Deed, the holder of the
contract must sign off on the loan.
o You must be able to meet the requirement for matching funds (25% of total project costs).
o Rents, including utility costs, shall not exceed the area fair market rents, established by HUD.
o No economic displacement is allowed. Economic displacement occurs as a result of rent increases
causing the tenant to move because they can no longer afford to rent the unit.
o Building owners must ensure that for 10 years, at least 51% of the rental units will be occupied by
low to moderate-income households at fair market rents.
The following improvements qualify under the SCDP: repairs that make the property more livable, energy
efficient, safe and accessible for handicapped occupants. These may include replacing or repairing:
Interior improvements such as