St. Paul resolves HUD investigationby Rupa Shenoy, Minnesota Public Radio
St. Paul, Minn. — The city of St. Paul has agreed to spend $1 million to resolve a federal investigation.
Last summer, the Housing and Urban Development Department found the city didn't have procedures in place to follow a law called Section 3, which requires governments receiving HUD money to give contracts to businesses owned by low-income people whenever possible.
St. Paul received at least $31 million from HUD from 2006 through 2008.
The law also requires governments to train people below the poverty line. But a HUD investigation concluded the city didn't have procedures in place to follow the law.
St. Paul's director of planning and economic development, Cecile Bedor, says the city didn't keep the required paperwork.
"These are things the city is doing already, so this isn't anything we object to at all as a matter of fact," said Bedor.
St. Paul agreed to spend $1 million over four years on outreach, training and hiring of poor people.
HUD had been withholding $18 million in foreclosure assistance until the issue was resolved.