PART 1 - Program Description
Saint Paul’s neighborhoods are one of its greatest assets. With this in mind, state and local legislation was enacted in 1993 to allocate revenue from the city’s half-cent sales tax to the Neighborhood Sales Tax Revitalization (STAR) Program. Administered by the City’s Department of Planning and Economic Development (PED), Neighborhood STAR provides loans and grants for physical improvement projects which strengthen the vitality of our city’s neighborhoods.
The STAR Program represents an extraordinary opportunity to revitalize our community. Providing economic development opportunities, stabilizing and renewing Saint Paul’s housing stock, and rejuvenating public infrastructure can be accomplished through the strategic use of Neighborhood STAR funds.
An annual STAR budget is proposed by the Mayor as part of the City’s budget process, and is approved by the City Council. The appropriation is based on a combination of sales tax revenue projections, loan repayments, and investment earnings. The goal of the program is to award sixty percent (60%) of the Neighborhood STAR funds as loans, and forty percent (40%) as grants.
Annual STAR Program Cycle
The Neighborhood STAR Program offers loans and grants to non-profit, public and for-profit entities seeking $5,000 or more in financial assistance. Non-profit, public and small for-profit entities may request loan and/or grant assistance. Large, for-profit businesses are eligible to apply for a loan or a loan-grant combination provided the grant portion is equal to or less than the amount of loan dollars being requested.
Neighborhood STAR is awarded through a competitive application process once per year, with the schedule announced in January. When funding is available, the STAR Year-Round Loan and Grant Program provides funding opportunities for initiatives which have a particular urgency, and cannot meet the general program cycle.
General Policies and Expectations
STAR proposals must be for capital improvement projects or programs located within the Saint Paul city limits. Projects and programs financed with STAR funds are expected to be used for their funded purpose for seven (7) or more years. If for any reason the STAR-funded initiative is discontinued or property sold prior to seven years, the STAR award may be required to be returned to the city.
To maximize the use of STAR funds, loan requests over $50,000 and every STAR grant dollar needs to be matched on a minimum dollar for dollar basis with non-city resources.
STAR projects should encourage a public purpose by: maintaining or increasing the tax base; creating and/or retaining jobs; building wealth within neighborhoods; celebrating and/or strengthening the city’s cultural diversity; advancing climate-action, sustainability, and/or resilience goals as put forth in the Saint Paul Climate Action and Resilience Plan. Proposed activities should be consistent with approved neighborhood plans or initiatives.
Over time, STAR projects and resources should strive for geographic and financial equity across all city neighborhoods.
The following compliance requirements may apply to your proposal and can be reviewed on the City of Saint Paul’s website: http://www.stpaul.gov/index.aspx?NID=3710
- Affirmative Action: Entities receiving $50,000 or more of city funds within a 12-month period.
- Business Subsidy: May apply to recipients of grants of $25,000 or more and loans of $75,000 and over.
- Federal Davis Bacon Requirements: Projects of $2,000 or more receiving at least one dollar of federal funds.
- Little Davis Bacon Requirements: Total project costs of $25,000 or more.
- Living Wage: Entities receiving $100,000 or more of city funds.
- Project Labor Agreement: Entities receiving $250,000 or more of city funding.
- Section 3: Economic opportunities to low income persons or business concerns residing close to a project’s location.
- PED/HRA Sustainability Initiative: May apply to projects of any size.
- Saint Paul Sustainable Building Policy: Projects receiving over $200,000 in public funds.
- Two Bid Policy: Projects receiving $20,000 or more of city funds.
- Vendor Outreach Program: Total project costs of $50,000 or more.