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Housing & Redevelopment Authority - HRA-Packet-08-05-2026 Supporting Documents - 08/05/2026
OTTER TAIL COUNTY – MINNESOTA HOUSING AND REDEVELOPMENT AUTHORITY AGENDA Government Services Center, Otter Tail Lake Room 515 West Fir Avenue, Fergus Falls, MN August 5, 2026 | 12:45 pm Commissioners may participate in the meeting by interactive technology. 1. Call Meeting to Order and Roll Call – Chairperson 2. Approval of Agenda 3. Consent Agenda A. Regular Board Meeting Minutes, July 8, 2026 B. Housing Choice Voucher Rental Assistance Program for June 2026 C. Bring It Home Rental Assistance Program Report for June 2026 D. Housing Trust Fund for June 2026 E. Public Housing and Senior Housing for June 2026 F. Check Report and Financial Reports for June 2026 4. New Business A. Motion to Accept Audited Financial Statements for the Year Ended December 31, 2025 B. Resolution No. 337 Approving Special Benefit Levy Request for Taxes Payable 2027 5. Old Business A. Resolution No. 338 Approving the Sale of Real Property and a Purchase and Development Agreement for HRA Owned Property in Vergas, MN B. Closed session: Authorized under Minn. Stat. Sec. §13D.05, Subd. 3(1), to discuss the sale or purchase of real property located at 514 Annes Court, 612 West Colfax St and 627 Krista Circle, Parkers Prairie, MN 6. Discussion A. 55965 360th Street, New York Mills B. Bring it Home Underserved Area – Wilkin County C. Board Member Update 7. Executive Director Report A. 21st Century ROAD to Housing Act 8. General Discussion – Topics by Commissioners 9. Adjourn 1/81 2/81 The Otter Tail County HRA Board of Commissioners Met for a regular meeting on July 8, 2026 at 12:45 pm At the Otter Tail County Government Services Center 515 W Fir Ave, Fergus Falls, MN Board Members Present: Wayne Johnson, Chairperson Leland Rogness, Vice Chairperson Megan Myers Virtual: Kurt Mortenson Absent: Jeff Ackerson Others Present: Amy Baldwin, OTC HRA Executive Director Tanya Westra, OTC HRA Housing Program Supervisor Paula Grunewald, OTC HRA Administrative Assistant Virtual: Aann Christopherson, OTC HRA Accountant 1. CALL TO ORDER Chairperson Johnson called the meeting to order at 12:45 pm. 2/3. APPROVAL OF AGENDA & APPROVAL OF CONSENT AGENDA ITEMS Motion made by Leland Rogness, second by Megan Myers to approve the July 8, 2026 Agenda and the Consent Agenda including changes to Consent Agenda: the Regular Board Meeting Minutes should be listed as June 3, 2026 and New Business A. - Resolution No. 335, property location should be indicated as 205 instead of 220. A land appraisal report was handed out in regard to 5C – Purchase of Single-Family Lots in Parkers Prairie. Commissioners Wayne Johnson, Megan Myers and Leland Rogness voted yes. Motion passed unanimously. 4. PUBLIC HEARING: Wayne Johnson opened the Public Hearing at 12:47 pm, in regard to the sale of HRA owned property located at 205, 225 and 235 Eva St, Vergas. Notice was placed in Fergus Falls Daily Journal and terms of sale were available at the Government Services Center. No one was present at the meeting to speak on the matter, and no communication was received in writing. The hearing was closed at 12:48 pm. 5. NEW BUSINESS A. Resolution No. 335 Authorizing Sale of HRA Owned Property located at 205, 225 & 235 Eva Sreet, Vergas, MN 3/81 OTTERTAIL COU TY· MINNESOTA HOUSING AND REDEVELOPMENT AUTHORITY Government Services Center 500 West Fir Avenue Fergus Falls, MN 56537 218-998-8730 @ OTTER TAIL COUNTY IS AN EQUAL OPPORTUNITY EMPLOYER @ ottertailcounty.gov LIVE YOUR best life HERE. Pg. 2 Amy Baldwin, HRA Executive Director stated that the HRA had received a proposal from JRMH Holdings to construct a single-family home on all three lots to sell to an income eligible buyer. Topography at 235 Eva Street makes construction challenging. The proposed purchase price is 25% of estimated market value. Terms of Sale were discussed including the total sale price of $6,600, must be a single-family dwelling and sold to a household whose annual gross income does not exceed 115% of State Median Income, development shall be in conformance with the submitted proposal, and construction to be completed within 2 years of execution of the Purchase and Development Agreement. After holding a Public Hearing and receiving no comment, a motion was made by Megan Myers, second by Leland Rogness to accept the terms of sale and prepare any and all documents necessary to effectuate the sale and closing of the property. Commissioners Wayne Johnson, Megan Myers and Leland Rogness voted yes. Motion passed unanimously. B. Resolution No. 336 Authorizing Executive of Engagement Letter and Contract for 2026-2028 Fiscal Year Audits Amy Baldwin, HRA Executive Director stated we had received two comparable proposals from Abdo Solutions and Brady Martz for 2026-2028 Fiscal Year Audits. After viewing the proposals, it is the staff’s recommendation to accept the Brady Martz proposal. Motion made by Leland Rogness, second by Megan Myers to execute the engagement contract for 2026-2028 physical year audits with Brady Martz. Commissioners Wayne Johnson, Megan Myers and Leland Rogness voted yes. C. Purchase of Single Family Lots in Parkers Prairie Amy Baldwin, HRA Executive Director stated HRA will construct and sell three homes in Parkers Prairie utilizing the MN Housing Community Impact Fund Value Gap Grant Program award. Sites for consideration are owned by Revering Group LLC at 514 Annes Court, 612 West Colfax St and 627 Krista Circle. After receiving the land appraisal report the request of staff is to proceed with making an offer at the appraised value. Motion was made by Megan Myers, second by Leland Rogness for staff to proceed with making an offer at the appraised value of $19,000 per lot to the Revering Group LLC. Commissioners Wayne Johnson, Megan Myers and Leland Rogness voted yes. Motion passed unanimously. D. Call for Public Hearing related to the Annual Plan, 2027 Public Housing Capital Fund Plan, Definition of Significant Amendment, Proposed 2027 Public Housing Administrative and Continued Occupancy Plan and Lease Changes, Proposed 2027 Housing Choice Voucher Administrative Plan Changes Tanya Westra, HRA Housing Program Supervisor discussed the proposed changes to the Annual Plan/Goals & Objectives and Public Housing Admissions and Continued Occupancy Plan, Public Housing Lease, and the Housing Choice Voucher Administrative Plan, There are no proposed changes to 2027 Capital Fund Plan or Definition of Significant Amendment. Motion made by Leland Rogness, second by Megan Myers on the recommendation of staff to proceed with a Public Hearing on September 2, 2026 starting at 12:45 pm or shortly thereafter in regards to the Annual Plan, 2027 Public Housing Capital Fund Plan, Definition of Significant Amendment, Proposed 2027 Public Housing Administrative and Continued Occupancy Plan and Lease Changes, and Proposed 2027 Housing Choice Voucher Administrative Plan Changes. Commissioners Wayne Johnson, Megan Myers and Leland Rogness voted yes. Kurt Mortenson left the meeting at 1:36 pm. 4/81 Pg. 3 6. OLD BUSINESS – NONE 7. DISCUSSION A. 2027 HRA Levy Request 8. EXECUTIVE DIRECTOR REPORT A. 2025 Audit Complete – Finance Committee meeting to be scheduled. B. Bring It Home Rental Assistance – monitoring visit held with MN Housing. C. NYM Senior Housing – working with city to replat parcels, initial funding webinars with HUD related to Congressionally Directed Spending. 9. GENERAL DISCUSSION – TOPICS BY COMMISSIONERS 10. ADJOURNMENT At 2:08 pm the meeting was adjourned. ________________________________________________________ ___________________ Secretary/Clerk Date 5/81 6/30/2026 7/1/2026 Difference 34,437.68$ 34,029.68$ -$408.00 68 68 0 27,920.00$ 27,512.00$ *HAP Adjustment *Utility Adjustment *Portability Tranactions (Out)6,253.00$ 6,253.00$ *Portablilty Admin Fee (Paid)264.68$ 264.68$ 6/30 7/1 New Admissions 0 End Participation 0 Port Out ( Absorbed)0 Vouchers Issued 1 0 Current HCV Participant Ports-Out Paid 5 5 Ports Out Pending 0 0 Ports In Pending 0 0 6/30/2026 Waiting List/To Date 180 Applications in Progress 12 Vouchers issued 2 From Waitlist & Port In ELI%100%YTD Monthly Trend Report*Units Available Units Leased Leasing %Budget %Per Unit $ January 2026 144 73 50.7% 86.0% 514.52$ February 2026 144 71 50.0% 85.2% 516.59$ March 2026 144 72 51.2% 86.0% 509.48$ April 2026 144 72 50.9% 85.4% 506.16$ May 2026 144 71 50.6% 84.1% 486.74$ June 2026 144 68 50.0% 83.2% 506.44$ *Leasing % and Budget % based on cumulative activity during calendar year Per Unit $ is rolling three month average *Portability Utility Reimbursement Portability Adjustments OTC Section 8 Housing Choice Voucher Rental Assistance Program Summary of Actions June 30, 2026 Program Total Financial Transaction Paid This Month* UML (Unit Months Leased or # of Households) *HAP & Utility Reimbursement Payments 6/81 &, OTTE:R 'TAIL ~, COUNTY -MINNESOTA 218-998-8730 ® HOUSING AND REDEVIELOPMENT AUTHO,RITY OTTER TAIL COUNTY IS AN EQUAL OPPORTUNITY EMPLOYER Go,v,etn mein,t Services Center 500 West Fli-Avenue Fergus Falls, MN 56537 @ ottertailcounty.gov 6/1/2026 6/30/2026 Difference HAP Transactions Utility Reimbursements HAP Adjustment Utility Adjustment 6/30 7/1 New Admissions 1 End Participation 0 Shop Mode/ARS 0 6/30/2026 Waiting List/To Date 16 Applications in Progress 3 Vouchers "On the Street"1 Hold Landlord Transaction OTC Bring It Home Rental Assistance Program Summary of Actions June 30, 2026 Program Total Financial Transaction Paid This Month UML (Unit Months Leased or # of Households) 7/81 &, OTTE:R 'TAIL ~, COUNTY -MINNESOTA 218-998-8730 ® HOUSING AND REDEVIELOPMENT AUTHO,RITY OTTER TAIL COUNTY IS AN EQUAL OPPORTUNITY EMPLOYER Go,v,etn mein,t Services Center 500 West Fli-Avenue Fergus Falls, MN 56537 @ ottertailcounty.gov HOUSING TRUST FUND PROGRAMS (HTF) BOARD REPORT June 2026 Program Applications Approved Applications Denied Inspections Conducted Proceed to Work Issued Projects Complete Goal Program End Date Housing Trust Fund Emergency Home Repair Program (EHRP) 1 0 1 1 0 On-Going Down Payment Assistance (DPA) 2 0 N/A N/A 2 On-Going Rent Rehab – RR 0 0 0 0 0 On-Going Affordable Rental Unit Construction - ARUC 1 0 1 1 0 On-Going Residential Owner- Occupied Leverage (ROHL) 0 0 0 0 0 PELICAN RAPIDS 09/30/2027 SCDP: Commercial 6 1 6 1 10 SCDP: Homeowner 14 1 14 8 3 17 8/81 218-998-8730 @ HOUSING AND REDEVELOPMENT AUTHORITY OTTER TAIL COUNTY IS AN EQUAL OPPORTUNITY EMPLOYER Government Services Center 500 West Fir Avenue Fergus Falls, MN 56537 (!) EOU/\L HOUSING OPPORTUNITY @ ottertailcounty.gov PUBLIC HOUSING BOARD REPORT June 2026 Rents Payable $ 6,606.00 Rents Collected $ 6,169.00 Total Negative Rents $ 0 Negative Rents Paid $ 0 Late Fees Charged $ 52.00 Late Fees Collected $ 18.00 Number of Units Paying Flat Rent 2 Fiscal Year ELI WAITING LIST as of 7/17/2026 Community 2 Bedroom 3 Bedroom 4 Bedroom Pelican Rapids 8 15 N/A Underwood 2 2 0 Henning 6 2 0 New York Mills 9 7 0 VACANCIES UNIT VACATED LEASE SIGNED *206 Holden, Henning-notice *206 Foss #1, Underwood-notice *Notice to vacate 6/30/26 *Notice to vacate 6/30/26 *Working on 3 applicants *Lease signing scheduled for end of July 9/81 218-998-8730 ® HOUSING AND REDEVELOPMENT AUTHORITY OTTER TAIL COUNTY IS AN EQUAL OPPORTUNITY EMPLOYER Government Services Center 500 West Fir Avenue Fergus Falls, MN 56537 G:r EOUJ\L HOUSING OPPORTUNITY @ ottertailcounty.gov AFFORDABLE SENIOR HOUSING BOARD REPORT July 2026 Rents Payable $ 5,300.00 Rents Collected $ 5,300.00 Late Fees $ 0.00 Late Fees Collected $ WAITING LIST as of 7/17/2026 Community 1 Bedroom 2 Bedroom Dalton 7 VACANCIES UNIT VACATED LEASE SIGNED 2 10/81 218-998-8730 ® HOUSING AND REDEVELOPMENT AUTHORITY OTTER TAIL COUNTY IS AN EQUAL OPPORTUNITY EMPLOYER Government Services Center 500 West Fir Avenue Fergus Falls, MN 56537 (!) EOUI\L HOUSING OPPORTUNITY @ ottertailcounty.gov Doc Num Voided Type 208 No DD 209 No DD 210 No DD 211 No DD 212 No DD 1720 No CHK 1721 No CHK 1722 No CHK 1723 No CHK 1724 No CHK 1725 No CHK End of Report Total:11 $110,853.07 Vendor Accounting - 11 $110,853.07 Vendor Accounting Total 11 $110,853.07 Transaction Type Summary Transaction Type Count Amount Check (CHK)6 $110,418.61 Total:11 $110,853.07 Count Amount Direct Deposit (DD)5 $434.46 Project Summary Program - Project Payments Deposits General Revolving (GR) - $110,853.07 $0.00 Total:$110,853.07 $0.00 Document Type Summary Document Type Cleared: 9 $110,676.19 Uncleared: 2 $176.88 Total Payments: 11 $110,853.07 06/26/2026 Vergas Public Hearing Notice No $138.48 06/26/2026 Shredding Services No $38.40 06/12/2026 SCDP PR2025-08 Banton Yes $16,528.90 06/26/2026 Renew Prof Liability Policy Yes $32,734.78 06/12/2026 SCDP Heaton Yes $9,190.00 06/12/2026 Payroll services, postage, Yes $51,788.05 06/12/2026 Per Diem/Mileage Yes $75.00 06/12/2026 Per Diem/Mileage Yes $104.73 06/12/2026 Per Diem/Mileage Yes $93.85 06/12/2026 Per Diem/Mileage Yes $77.90 Payment Document Description Cleared Amount 06/12/2026 Per Diem/Mileage Yes $82.98 Otter Tail County Housing Redevelopment Authority General Ledger Cash Payment/Receipt Register General Revolving (GR) Posted Payments www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 1 of 1 7/6/2026 11:14:04 AM Printed by: Aann Christopherson 11/81 50% Period YTD Annual Remaining Amount Amount Budget Budget INCOME 3610 Interest Income 3703/5353/3741/0054 171.59 4,568.99 8,000.00 (3,431.01)57% 3690.01 SCDP Administration (DEED) - All Communities 1,625.55 67,500.00 (65,874.45)2% 3690.02 SCDP City/Grant Funds - All Communities 10,837.00 450,000.00 (439,163.00)2% 3691 Levy Revenue 899,323.56 1,610,431.00 (711,107.44)56% 3693.03 CHIP FFHRA Rehab Repayments 702.20 702.20 3693.05 CHIP Rental Rehab Revolving Loan Payments 878.67 7,161.85 9,800.00 (2,638.15)73% 3694 HTF Contributions 75,000.00 (75,000.00)0% 3697 Owner Match Revenue 411.00 3,000.00 (2,589.00)14% TOTAL INCOME 1,050.26 924,630.15 2,223,731.00 (1,299,100.85)42% EXPENSES 4130 Legal 733.50 20,000.00 19,266.50 4% 4140 Staff Training 179.00 1,122.28 6,000.00 4,877.72 19% 4150 Travel 76.45 500.00 423.55 15% 4170 Accounting 5,000.00 25,000.00 30,000.00 5,000.00 83% 4171 Audit 8,250.00 20,750.00 12,500.00 40% 4190 Other Administrative Expenses 136.34 336.34 5,000.00 4,663.66 7% 4190.01 Manuals, Subscriptions 1,000.00 1,000.00 0% 4190.02 Office Supplies 89.80 529.27 1,700.00 1,170.73 31% 4190.03 Postage 345.50 1,325.23 2,500.00 1,174.77 53% 4190.05 Dues 993.48 1,500.00 506.52 66% 4190.06 Advertising 138.48 138.48 2,000.00 1,861.52 7% 4190.08 Consulting Fees 4.20 1,532.90 40,000.00 38,467.10 4% 4190.2 Management Fees-OTC Admin 36,991.23 212,639.26 643,985.00 431,345.74 33% 4210 Board Member Payments 434.46 2,068.70 5,000.00 2,931.30 41% 4420 Maintenance - Materials 394.52 (394.52) 4430.1 Misc Contracts - Software 7,756.00 12,500.00 4,744.00 62% 4510 Insurance 17,757.43 33,331.78 53,000.00 19,668.22 63% 4570 Housing Choice Voucher Payroll Operating Support 1,745.00 25,230.86 (25,230.86) 4570.1 Housing Choice Voucher Program Support 30,000.00 30,000.00 0% 4580 Public Housing Payroll Operating Support 7,335.38 10,988.09 (10,988.09) 4580.1 Public Housing Program Support 20,000.00 20,000.00 0% 4590.01 SCDP O & E Reports 285.00 1,425.00 1,140.00 20% 4590.02 SCDP Lead Based Paint Testing 1,725.00 10,000.00 8,275.00 17% 4590.03 SCDP Construction (DEED)25,718.90 107,271.64 439,310.00 332,038.36 24% 4590.04 SCDP Recording Fees 46.00 690.00 644.00 7% 4592.01 HOP Demolition/Site Clearance 45,000.00 45,000.00 0% 4593.02 CAP Property Acquisition 25,000.00 25,000.00 0% 4593.03 CAP Consulting Fees 5,000.00 5,000.00 0% 4593.04 CAP Architect/Engineering 5,000.00 5,000.00 0% 4593.05 CAP Legal Fees 5,000.00 5,000.00 0% 4597.01 County Assistance Repay Principal (BUDGET USE ONLY 35,326.00 35,326.00 0% 4597.02 County Assistance Repay Interest-N Fields Dalton (2,037.21)15,128.00 17,165.21 -13% 4598 Owner Match Expense 10,970.65 3,000.00 (7,970.65)366% 4694 Housing Trust Fund 375,000.00 375,000.00 0% 4694.01 HTF Down Payment Assistance (DPA)23,700.00 (23,700.00) 4694.04 HTF Affordable Rental Unit Constr (ARUC) Repayment 165,046.00 (165,046.00) TOTAL EXPENSES 95,875.72 639,454.22 1,860,314.00 1,220,859.78 34% SURPLUS (94,825.46)285,175.93 363,417.00 (78,241.07)78% Otter Tail County Housing Redevelopment Authority Operating Statement Six Months Ending 06/30/2026 Program: General Revolving (GR) Project: Consolidated Percent of the Year www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 1 of 1 7/6/2026 10:57:41 AM Printed by: Aann Christopherson 12/81 Period Amount Balance ASSETS1111 Cash (110,681.58)3,324,729.731111.1 Certificates of Deposit 157,744.35 1111.4 Committed for Housing Trust Fund 769,935.00 1113 Cash Rental Rehab 878.77 12,177.041130.1 Loan Receivable-Rental Rehab 34,282.49 1130.2 Loan Receivable-Down Payment Assistance 271,064.001130.3 Loan Receivable-Tax Levy Rehab Provision 146,608.73 1130.4 Loan Receivable-Homeowner Rehab 11,391.19 1130.9 Loan Allowance (157,999.92)1400.6 Land 26,400.00 TOTAL ASSETS (109,802.81)4,596,332.61 LIABILITIES AND SURPLUSLIABILITIES2130.1 OTC Long-Term Loan 756,412.33 2250 Prepaid Expenses (14,977.35)(14,977.35) TOTAL LIABILITIES (14,977.35)741,434.98 SURPLUS2700 Income/Expense Clearing Account 344,167.99 2700 Income/Expense Clearing Account (Current Year) 2,037.21 2806 Unrestricted Net Position 3,225,553.712806 Unrestricted Net Position (Current Year) (94,825.46)283,138.72 TOTAL SURPLUS (94,825.46)3,854,897.63TOTAL LIABILITIES AND SURPLUS (109,802.81)4,596,332.61 Otter Tail County Housing Redevelopment Authority Balance Sheet June 2026 Program: General Revolving (GR) Project: Consolidated www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 1 of 1 7/7/2026 8:12:02 AM Printed by: Aann Christopherson 13/81 Doc Num Voided Type 1924 No DD 1925 No DD 1926 No DD 1927 No DD 1928 No DD 1929 No DD 1930 No DD 1931 No DD 1932 No DD 1933 No DD 1934 No DD 1935 No DD 1936 No DD 1937 No DD 1938 No DD 1939 No DD 1940 No DD 1941 No DD 1942 No DD 1943 No DD 1944 No DD 1945 No DD 1946 No DD 1947 No DD 1948 No DD 1949 No DD 1950 No DD 1951 No DD 1952 No DD 1953 No DD 1954 No DD 1955 No DD 1956 No DD 1957 No DD 1958 No DD 6933 No CHK 6934 No CHK 6935 No CHK 6936 No CHK 6937 No CHK 6938 No CHK 6939 No CHK 6940 No CHK 06/01/2026 HAP Util Payment Jun 26 Yes $12.00 06/01/2026 HAP Util Payment Jun 26 Yes $97.00 06/01/2026 HAP Payment Jun 26 Yes $274.00 06/01/2026 HAP Util Payment Jun 26 No $18.00 06/01/2026 HAP Payment Jun 26 Yes $335.00 06/01/2026 HAP Payment Jun 26 Yes $700.00 06/01/2026 HAP Payment Jun 26 Yes $305.00 06/01/2026 HAP Payment Jun 26 Yes $396.00 06/01/2026 HAP Payment Jun 26 Yes $359.00 06/01/2026 Port Out Payment Jun 26 Yes $1,183.19 06/01/2026 HAP Payment Jun 26 Yes $333.00 06/01/2026 HAP Payment Jun 26 Yes $268.00 06/01/2026 HAP Payment Jun 26 Yes $497.00 06/01/2026 HAP Payment Jun 26 Yes $460.00 06/01/2026 HAP Payment Jun 26 Yes $335.00 06/01/2026 HAP Payment Jun 26 Yes $496.00 06/01/2026 HAP Payment Jun 26 Yes $507.00 06/01/2026 HAP Payment Jun 26 Yes $463.00 06/01/2026 HAP Payment Jun 26 Yes $931.00 06/01/2026 HAP Payment Jun 26 Yes $360.00 06/01/2026 HAP Payment Jun 26 Yes $427.00 06/01/2026 HAP Payment Jun 26 Yes $321.00 06/01/2026 HAP Payment Jun 26 Yes $2,226.00 06/01/2026 HAP Payment Jun 26 Yes $1,643.00 06/01/2026 HAP Payment Jun 26 Yes $650.00 06/01/2026 HAP Payment Jun 26 Yes $377.00 06/01/2026 HAP Payment Jun 26 Yes $1,121.00 06/01/2026 HAP Payment Jun 26 Yes $1,149.00 06/01/2026 HAP Payment Jun 26 Yes $431.00 06/01/2026 HAP Payment Jun 26 Yes $589.00 06/01/2026 HAP Payment Jun 26 Yes $399.00 06/01/2026 HAP Payment Jun 26 Yes $269.00 06/01/2026 HAP Payment Jun 26 Yes $453.00 06/01/2026 HAP Payment Jun 26 Yes $1,427.00 06/01/2026 HAP Payment Jun 26 Yes $416.00 06/01/2026 HAP Payment Jun 26 Yes $4,351.00 06/01/2026 HAP Payment Jun 26 Yes $494.00 06/01/2026 HAP Payment Jun 26 Yes $400.00 06/01/2026 HAP Payment Jun 26 Yes $700.00 06/01/2026 HAP Payment Jun 26 Yes $820.00 06/01/2026 HAP Payment Jun 26 Yes $1,080.00 06/01/2026 HAP Payment Jun 26 Yes $381.00 Payment Document Description Cleared Amount 06/01/2026 HAP Payment Jun 26 Yes $504.00 Otter Tail County Housing Redevelopment Authority General Ledger Cash Payment/Receipt Register Housing Choice Vouchers Posted Payments www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 1 of 3 7/6/2026 12:35:45 PM Printed by: Aann Christopherson 14/81 Otter Tail County Housing Redevelopment Authority General Ledger Cash Payment/Receipt Register Housing Choice Vouchers 6941 No CHK 6942 No CHK 6943 No CHK 6944 No CHK 6945 No CHK 6946 No CHK 6947 No CHK 6949 No CHK 6950 No CHK 6951 No CHK Doc Num Voided Type 28602 M No CHK Tenant Accounts 1 $105.80 Tenant Accounting - 1 $105.80 Vendor Accounting - 3 $7,117.63 Vendor Accounting Total 3 $7,117.63 HAP Accounting Total 45 $27,920.00 HAP Accounting - 45 $27,920.00 Port/Sub Out - Payment 5 $6,517.68 Portability/Subsidy Out 5 $6,517.68 Transaction Type Summary Transaction Type Count Amount Check (CHK)19 $14,840.92 Total:54 $41,661.11 Count Amount Direct Deposit (DD)35 $26,820.19 Project Summary Program - Project Payments Deposits Housing Choice $41,555.31 $105.80 Total:$41,555.31 $105.80 Document Type Summary Document Type 06/02/2026 Payment - Check Yes $105.80 Cleared: 1 $105.80 Uncleared: 0 $0.00 Total Deposits: 1 $105.80 Posted Deposits Control Date Document Description Cleared Amount Cleared: 51 $40,468.56 Uncleared: 2 $1,086.75 Total Payments: 53 $41,555.31 06/12/2026 Payroll services, training Yes $6,023.50 06/26/2026 Remote Admin Plan & ACOP No $1,068.75 06/01/2026 Port Out Payment Jun 26 Yes $1,769.92 06/12/2026 Mileage Yes $25.38 06/01/2026 Port Out Payment Jun 26 Yes $1,394.19 06/01/2026 Port Out Payment Jun 26 Yes $958.19 06/01/2026 HAP Util Payment Jun 26 Yes $51.00 06/01/2026 Port Out Payment Jun 26 Yes $1,212.19 06/01/2026 HAP Util Payment Jun 26 Yes $61.00 06/01/2026 HAP Util Payment Jun 26 Yes $34.00 www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 2 of 3 7/6/2026 12:35:45 PM Printed by: Aann Christopherson 15/81 Otter Tail County Housing Redevelopment Authority General Ledger Cash Payment/Receipt Register Housing Choice Vouchers End of Report Total:54 $41,661.11 www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 3 of 3 7/6/2026 12:35:45 PM Printed by: Aann Christopherson 16/81 50% Period YTD Annual Remaining Amount Amount Budget Budget INCOME 3110 Dwelling Rent HAP Repayment 4,713.00 4,713.00 3301 Admin Subsidy 5,201.00 22,566.00 65,000.00 (42,434.00)35% 3301.1 HAP Subsidy 183,894.00 515,000.00 (331,106.00)36% 3450.2 Revenue Recapture 3,552.48 3,552.48 3610 Investment Income (0062)3.14 29.43 29.43 3690 Other Revenue MISC 105.00 105.00 3690.1 Other Revenue HAP 30,000.00 (30,000.00)0% TOTAL INCOME 5,204.14 214,859.91 610,000.00 (395,140.09)35% EXPENSES 4130 Legal 3,594.00 (3,594.00) 4140 Staff Training 89.50 89.50 4,400.00 4,310.50 2% 4150 Travel 25.38 47.86 250.00 202.14 19% 4190 Other Admin Expenses (Apps, Service Charges)22.00 201.93 400.00 198.07 50% 4190.01 Manuals, Subscriptions 478.00 8,500.00 8,022.00 6% 4190.08 Consulting Fees 1,068.75 1,916.25 1,500.00 (416.25)128% 4190.2 Management Fees-OTC 5,934.00 16,076.09 47,000.00 30,923.91 34% 4715.1 HAP Occupied Units 28,870.00 182,013.00 455,000.00 272,987.00 40% 4715.P HAP-Portability Out 6,253.00 35,038.00 60,000.00 24,962.00 58% 4716.P Port Out Admin Fee 264.68 1,433.40 2,400.00 966.60 60% TOTAL EXPENSES 42,527.31 240,888.03 579,450.00 338,561.97 42% SURPLUS (37,323.17)(26,028.12)30,550.00 (56,578.12)-85% Otter Tail County Housing Redevelopment Authority Operating Statement Six Months Ending 06/30/2026 Program: Housing Choice Vouchers Project: Consolidated Percent of the Year www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 1 of 1 7/6/2026 12:28:40 PM Printed by: Aann Christopherson 17/81 Period Amount Balance ASSETS 1111 Cash Unrestricted (36,267.37)88,985.87 1121 Fraud A/R (105.80)3,491.60 1121.1 Fraud Recovery - Allowance (3,457.19) TOTAL ASSETS (36,373.17)89,020.28 LIABILITIES AND SURPLUS LIABILITIES 2112 A/P HAP 950.00 3,538.00 TOTAL LIABILITIES 950.00 3,538.00 SURPLUS 2700 Inc & Exp Clearing (19,614.50) 2700 Inc & Exp Clearing (Current Year) 3,552.48 2805 Restricted Net Position 63,141.74 2805 Restricted Net Position (Current Year) (35,123.00)(33,157.00) 2806 Unrestricted Position 67,983.16 2806 Unrestricted Position (Current Year) (2,200.17)3,576.40 TOTAL SURPLUS (37,323.17)85,482.28 TOTAL LIABILITIES AND SURPLUS (36,373.17)89,020.28 Otter Tail County Housing Redevelopment Authority Balance Sheet June 2026 Program: Housing Choice Vouchers Project: Consolidated www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 1 of 1 7/6/2026 12:28:39 PM Printed by: Aann Christopherson 18/81 50% Period YTD Annual Remaining Amount Amount Budget Budget INCOME 3300.1 Administrative Fees 1,000.00 1,000.00 3301 Admin Subsidy 17,400.00 (17,400.00)0% 3301.1 HAP Subsidy 13,154.00 13,154.00 78,927.00 (65,773.00)17% TOTAL INCOME 13,154.00 14,154.00 96,327.00 (82,173.00)15% EXPENSES 4150 Travel 250.00 250.00 0% 4190 Other Admin Expenses (Apps, Service Charges)1,000.00 1,000.00 0% 4190.01 Manuals, Subscriptions 1,000.00 (1,000.00) 4190.08 Consulting Fees 500.00 500.00 0% 4190.2 Management Fees-OTC 15,650.00 15,650.00 0% 4715.1 HAP Occupied Units 78,927.00 78,927.00 0% TOTAL EXPENSES 1,000.00 96,327.00 95,327.00 1% SURPLUS 13,154.00 13,154.00 13,154.00 Otter Tail County Housing Redevelopment Authority Operating Statement Six Months Ending 06/30/2026 Program: Bring It Home Project: Consolidated Percent of the Year www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 1 of 1 7/6/2026 11:18:13 AM Printed by: Aann Christopherson 19/81 Period Amount Balance ASSETS 1111 Cash Unrestricted 13,154.00 13,154.00 TOTAL ASSETS 13,154.00 13,154.00 LIABILITIES AND SURPLUS LIABILITIES TOTAL LIABILITIES SURPLUS 2805 Restricted Net Position (Current Year) 13,154.00 13,154.00 TOTAL SURPLUS 13,154.00 13,154.00 TOTAL LIABILITIES AND SURPLUS 13,154.00 13,154.00 Otter Tail County Housing Redevelopment Authority Balance Sheet June 2026 Program: Bring It Home Project: Consolidated www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 1 of 1 7/6/2026 11:18:12 AM Printed by: Aann Christopherson 20/81 Doc Num Voided Type 7594 No VD 7611 No CHK 7612 No CHK 7613 No CHK 7614 No CHK 7615 No CHK 7616 No CHK 7617 No CHK 01000006210 No INV 01000410040 No INV 01000411010 No INV 01000411520 No INV Doc Num Voided Type No OP No OP No OP No OP No OP No OP No OP No OP No OP 126 No CHK 127 No CHK 186 No CHK 1380 No CHK 1381 No CHK 5038 No CHK 5039 No CHK 182.00 No CHK 22-124611474 No MO 22-127369600 No MO 55097784141 No CHK 55239865967 No MO 55239865974 No MO GNH19225 No CHK GNH19246 No CHK GNH19323 No CHK06/01/2026 Payment - Check Yes $22.91 06/01/2026 Payment - Check Yes $248.50 06/01/2026 Payment - Check Yes $248.50 06/01/2026 Payment - Money Order Yes $1,000.00 06/01/2026 Payment - Money Order Yes $41.41 06/08/2026 Payment - Money Order Yes $178.60 06/29/2026 Payment - Check Yes $700.00 06/01/2026 Payment - Check Yes $590.00 06/01/2026 Payment - Money Order Yes $590.00 06/01/2026 Payment - Check Yes $1,203.66 06/29/2026 Payment - Check Yes $1,215.16 06/01/2026 Payment - Check Yes $439.70 06/29/2026 Payment - Check Yes $515.21 06/15/2026 Payment - Check Yes $192.00 06/29/2026 Payment - Check Yes $430.00 06/19/2026 Payment - Online Payment Yes $255.95 06/15/2026 Payment - Check Yes $214.44 06/10/2026 Payment - Online Payment Yes $323.24 06/11/2026 Payment - Online Payment Yes $107.97 06/04/2026 Payment - Online Payment Yes $700.00 06/05/2026 Payment - Online Payment Yes $291.00 06/02/2026 Payment - Online Payment Yes $20.00 06/04/2026 Payment - Online Payment Yes $700.00 06/02/2026 Payment - Online Payment Yes $160.93 06/02/2026 Payment - Online Payment Yes $614.00 Posted Deposits Control Date Document Description Cleared Amount 06/02/2026 Water,Electric,Gas,Sewer Yes $315.16 Cleared: 9 $2,173.48 Uncleared: 3 $2,297.65 Total Payments: 12 $4,471.13 06/02/2026 Water,Electric,Gas,Sewer Yes $172.42 06/04/2026 Water,Electric,Gas,Sewer Yes $214.44 06/26/2026 Repair radon alarm system No $1,419.80 06/04/2026 Water,Electric,Gas,Sewer Yes $255.95 06/26/2026 Remote Admin Plan & ACOP No $806.25 06/26/2026 Paint Supplies No $71.60 06/12/2026 Training Yes $89.50 06/26/2026 Solar salt Yes $33.80 06/12/2026 Interior door Yes $550.84 06/12/2026 Water,Gas,Sewer Yes $612.97 Payment Document Description Cleared Amount 06/24/2026 Check lost in mail Yes ($71.60) Otter Tail County Housing Redevelopment Authority General Ledger Cash Payment/Receipt Register Public Housing Posted Payments www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 1 of 2 7/6/2026 12:46:06 PM Printed by: Aann Christopherson 21/81 Otter Tail County Housing Redevelopment Authority General Ledger Cash Payment/Receipt Register Public Housing GNH19324 No CHK GNH19327 No CHK GNH19328 No CHK GNH19349 No CHK GNH1950 No CHK GNH9373 No CHK GNH9374 No CHK End of Report Total:44 $15,802.75 Tenant Accounting - 32 $11,331.62 Tenant Accounts 32 $11,331.62 Vendor Accounting Total 12 $4,471.13 Vendor Accounting - 7 $3,584.76 Vendor Accounting Void 1 ($71.60) Transaction Type Summary Transaction Type Count Amount Vendor Accounting - 4 $957.97 Total:44 $15,802.75 Invoice (INV)4 $957.97 Money Order (MO)4 $1,810.01 Check (CHK)26 $9,933.28 Void Payment (VD)1 ($71.60) Count Amount Online Payment (OP)9 $3,173.09 Project Summary Program - Project Payments Deposits Public Housing - Family $4,471.13 $11,331.62 Total:$4,471.13 $11,331.62 Document Type Summary Document Type Cleared: 32 $11,331.62 Uncleared: 0 $0.00 Total Deposits: 32 $11,331.62 06/15/2026 Payment - Check Yes $44.59 06/15/2026 Payment - Check Yes $44.58 06/01/2026 Payment - Check Yes $53.30 06/01/2026 Payment - Check Yes $53.31 06/01/2026 Payment - Check Yes $54.87 06/01/2026 Payment - Check Yes $54.87 06/01/2026 Payment - Check Yes $22.92 www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 2 of 2 7/6/2026 12:46:06 PM Printed by: Aann Christopherson 22/81 50% Period YTD Annual Remaining Amount Amount Budget Budget INCOME 3110 Dwelling Rental 6,606.00 37,266.00 42,000.00 (4,734.00)89% 3401.1 HUD Operating Subsidy 8,278.20 43,000.00 (34,721.80)19% 3401.2 HUD Capital Funds-Operations/Admin 7,000.00 (7,000.00)0% 3401.3 HUD Capital Funds-Project 23,834.50 35,000.00 (11,165.50)68% 3450.1 Revenue Recapture 12,520.10 12,520.10 3610 Interest Income (5673/0070)4.63 28.78 28.78 3690 Other Income (NSF, Late Fee, GR 52.00 5,286.20 21,000.00 (15,713.80)25% 3690.1 Water Charge Income 654.66 3,848.32 7,500.00 (3,651.68)51% 3690.2 Electric Charge Income 962.28 6,124.99 13,000.00 (6,875.01)47% 3690.3 Gas Charge Income 643.08 8,353.63 10,800.00 (2,446.37)77% 3690.31 Sewer Charge Income 747.01 4,444.00 7,500.00 (3,056.00)59% 3690.4 Other Tenant Charges (Maint)1,445.85 1,500.00 (54.15)96% TOTAL INCOME 9,669.66 111,430.57 188,300.00 (76,869.43)59% EXPENSES 4130 Legal 2,000.00 2,000.00 0% 4140 Staff Training 89.50 89.50 5,000.00 4,910.50 2% 4150 Travel 25.38 300.00 274.62 8% 4171 Audit 2,400.00 2,400.00 100% 4190 Other Admin Expenses (Reports, Apps)42.09 600.00 557.91 7% 4190.01 Manuals, Subscriptions 1,300.00 1,300.00 0% 4190.06 Advertising 200.00 200.00 0% 4190.08 Consulting Fees 806.25 806.25 2,400.00 1,593.75 34% 4190.2 Management Fees-OTC 20,000.00 20,000.00 100% 4310 Water 656.99 3,372.76 7,500.00 4,127.24 45% 4320 Electric 941.48 4,419.44 13,000.00 8,580.56 34% 4330 Gas 601.31 6,689.22 10,800.00 4,110.78 62% 4331 Sewer 794.54 3,870.81 7,500.00 3,629.19 52% 4400 Maintenance - Tools & Equip 56.24 100.00 43.76 56% 4410 Maintenance - Labor 619.80 9,727.80 (9,727.80) 4420 Maintenance - Materials 1,350.84 10,746.55 10,000.00 (746.55)107% 4430 Maintenance - Contracts 33.80 1,999.80 22,000.00 20,000.20 9% 4431 Garbage and Trash Removal Contracts 500.00 500.00 0% 4510 Insurance 28,850.00 35,000.00 6,150.00 82% 4520 PILOT (129.74)6,034.00 6,163.74 -2% 4521 Assessments 969.00 1,050.00 81.00 92% 4570 Collection Loss 500.00 500.00 0% 4580 Interest Expense (on Security Deposits)75.00 75.00 0% 4600 Capital Fund Projects 23,834.50 35,000.00 11,165.50 68% TOTAL EXPENSES 5,894.51 117,769.60 183,259.00 65,489.40 64% Otter Tail County Housing Redevelopment Authority Operating Statement Six Months Ending 06/30/2026 Program: Public Housing Project: Consolidated Percent of the Year www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 1 of 2 7/6/2026 12:38:52 PM Printed by: Aann Christopherson 23/81 SURPLUS 3,775.15 (6,339.03)5,041.00 (11,380.03)-126% www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 2 of 2 7/6/2026 12:38:52 PM Printed by: Aann Christopherson 24/81 Period Amount Balance ASSETS 1111 Cash 5,370.14 101,587.50 1114 Tenant Security Deposit Cash 400.00 11,374.58 1122 A/R Tenants (113.21)2,549.38 1122.1 Allowance for Doubtful Accts (200.00) 1123 A/R Deposits (400.00) 1129 A/R Other 0.83 1400.5 Accumulated Depreciation (1,200,500.42) 1400.6 Land 32,990.31 1400.7 Buildings 1,747,400.34 TOTAL ASSETS 5,256.93 695,202.52 LIABILITIES AND SURPLUS LIABILITIES 2111 Vendors/Contractors (71.60) 2114 Tenant Security Deposits 11,376.67 2119 Accounts Payable (418.66) 2119.1 A/P Admin 418.66 2240 Tenants Prepaid Rent 1,553.38 1,911.42 TOTAL LIABILITIES 1,481.78 13,288.09 SURPLUS 2700 Income/Expense Clearing Account (84,799.41) 2700 Income/Expense Clearing Account (Current Year) 3,775.15 (6,339.03) 2802 Invested in Capital Assets, Net of Related Debt 679,466.94 2806 Unrestricted Net Position 93,585.93 TOTAL SURPLUS 3,775.15 681,914.43 TOTAL LIABILITIES AND SURPLUS 5,256.93 695,202.52 Otter Tail County Housing Redevelopment Authority Balance Sheet June 2026 Program: Public Housing Project: Consolidated www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 1 of 1 7/6/2026 12:38:51 PM Printed by: Aann Christopherson 25/81 Doc Num Voided Type 1074 No CHK 1075 No CHK 1076 No CHK 02000023510 No INV 02000023710 No INV 20141573 No INV Doc Num Voided Type 1011 No CHK 1298 No CHK 1300 No CHK 2477 No CHK 2482 No CHK 2484 No CHK 4554 No CHK 5666 No CHK 12655 No CHK 12656 No CHK HCV-6934 No CHK Vendor Accounting Total 6 $1,204.76 Vendor Accounting - 3 $502.24 Vendor Accounting - 3 $702.52 Transaction Type Summary Transaction Type Count Amount Invoice (INV)3 $502.24 Total:17 $7,552.16 Count Amount Check (CHK)14 $7,049.92 Project Summary Program - Project Payments Deposits Finding Home I LLC - $1,204.76 $6,347.40 Total:$1,204.76 $6,347.40 Document Type Summary Document Type 06/01/2026 Payment - Check Yes $396.00 Cleared: 11 $6,347.40 Uncleared: 0 $0.00 Total Deposits: 11 $6,347.40 06/29/2026 Payment - Check Yes $92.03 06/29/2026 Payment - Check Yes $750.00 06/29/2026 Payment - Check Yes $969.37 06/01/2026 Payment - Check Yes $842.53 06/22/2026 Payment - Check Yes $28.93 06/22/2026 Payment - Check Yes $950.00 06/22/2026 Payment - Check Yes $64.54 06/01/2026 Payment - Check Yes $950.00 06/01/2026 Payment - Check Yes $950.00 06/01/2026 Payment - Check Yes $354.00 Posted Deposits Control Date Document Description Cleared Amount 06/08/2026 Electric Yes $90.20 Cleared: 6 $1,204.76 Uncleared: 0 $0.00 Total Payments: 6 $1,204.76 06/02/2026 Water,Sewer Yes $205.46 06/02/2026 Water,Sewer Yes $206.58 06/12/2026 Garbage Yes $203.04 06/12/2026 Maintenance supplies Yes $59.90 Payment Document Description Cleared Amount 06/12/2026 Lawn care maintenance Yes $439.58 Otter Tail County Housing Redevelopment Authority General Ledger Cash Payment/Receipt Register Finding Home I LLC Posted Payments www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 1 of 2 7/6/2026 11:43:07 AM Printed by: Aann Christopherson 26/81 Otter Tail County Housing Redevelopment Authority General Ledger Cash Payment/Receipt Register Finding Home I LLC End of Report Total:17 $7,552.16 Tenant Accounting - 11 $6,347.40 Tenant Accounts 11 $6,347.40 www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 2 of 2 7/6/2026 11:43:07 AM Printed by: Aann Christopherson 27/81 50% Period YTD Annual Remaining Amount Amount Budget Budget INCOME 3110 Rent Revenue 5,300.00 27,034.00 55,450.00 (28,416.00)49% 3210 Replacement Reserves (Emergency/Updating)2,100.00 (2,100.00)0% 3610 Interest Income 0.37 4.97 10.00 (5.03)50% 3690 Other Income (NSF, Late Fees)(76.00)100.00 (176.00)-76% 3690.4 Other Tenant Charges (Maint)360.00 360.00 TOTAL INCOME 5,300.37 27,322.97 57,660.00 (30,337.03)47% EXPENSES 4130 Legal 1,500.00 1,500.00 0% 4171 Audit 3,000.00 3,000.00 100% 4190 Administrative Expense 54.55 (54.55) 4190.06 Advertising/Marketing/Printing 633.78 750.00 116.22 85% 4310 Water 224.04 1,073.68 2,750.00 1,676.32 39% 4320 Electric 165.55 (20.44)750.00 770.44 -3% 4331 Sewer 188.00 940.00 2,500.00 1,560.00 38% 4410 Maintenance-Labor 60.00 2,000.00 1,940.00 3% 4420 Maintenance-Materials 59.90 730.88 3,000.00 2,269.12 24% 4430 Maintenance-Contracts 439.58 3,879.91 16,500.00 12,620.09 24% 4431 Garbage/Trash Removal 203.04 1,319.76 2,550.00 1,230.24 52% 4510 Insurance 5,460.47 6,000.00 539.53 91% 4520 PILOT (Payment in Lieu of Taxes)(388.87)3,705.00 4,093.87 -10% 4521 Property Taxes/Assessments 408.00 250.00 (158.00)163% 4580 Interest Expense (on Security Deposits)35.00 35.00 0% TOTAL EXPENSES 1,280.11 17,151.72 45,290.00 28,138.28 38% SURPLUS 4,020.26 10,171.25 12,370.00 (2,198.75)82% Otter Tail County Housing Redevelopment Authority Operating Statement Six Months Ending 06/30/2026 Program: Finding Home I LLC Project: Consolidated Percent of the Year www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 1 of 1 7/6/2026 11:33:20 AM Printed by: Aann Christopherson 28/81 Period Amount Balance ASSETS 1111 Cash 4,678.12 41,035.94 1114 Tenant Security Deposit Cash 6,964.70 1122 A/R Tenants 186.38 184.67 1400.5 Accumulated Depreciation (33,914.43) 1400.6 Land 13,500.00 1400.7 Buildings 1,471,090.28 TOTAL ASSETS 4,864.50 1,498,861.16 LIABILITIES AND SURPLUS LIABILITIES 2114 Tenant Security Deposit 6,030.45 2240 Tenant Prepaid Rents 844.24 2,650.00 TOTAL LIABILITIES 844.24 8,680.45 SURPLUS 2700 Income/Expense Clearing Account 1,480,241.14 2700 Income/Expense Clearing Account (Current Year) 4,020.26 10,171.25 2806 Unrestricted Net Position (231.68) TOTAL SURPLUS 4,020.26 1,490,180.71 TOTAL LIABILITIES AND SURPLUS 4,864.50 1,498,861.16 Otter Tail County Housing Redevelopment Authority Balance Sheet June 2026 Program: Finding Home I LLC Project: Consolidated www.pha-web.com © 2026 Management Computer Services, Inc. (MCS) Page 1 of 1 7/6/2026 11:33:20 AM Printed by: Aann Christopherson 29/81 30/81 OTTER TAIL COUN,TYHOUSING AND REDEVELOPMENT AllTHORITY FERGUS FALLS, MINNESOTA AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 31/81 TABLE OF CONTENTS ROSTER OF OFFICIALS INDEPENDENT AUDITOR'S REPORT MANAGEMENT"S DISCUSSION AND ANALYSIS FINANCIAL STATEMENTS Statement of Net Position Statement of Revenues, Expenses, and Changes in Net Position Statement of Cash Flows Notes to the Financial Statements SUPPLEMENTARY INFORMATION Combining Schedule of Net Position Combining Schedule of Revenues, Expenses, and Changes in Net Position Combining Schedule of Cash Flows Schedule of Capital Fund Costs Page 1 2 6 10 11 12 14 23 25 26 28 INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MA TIERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS 29 SCHEDULE OF FINDINGS AND RESPONSES 31 32/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY ROSTER OF OFFICIALS -UNAUDITED DECEMBER 31, 2025 Name Position Term Expires Wayne Johnson Chairperson August 2027 Jeff Ackerson Commissioner August 2026 Megan Myers Commissioner August 2030 Lee Rogness Commissioner August 2029 Kurt Mortenson Commissioner August2028 -1- 33/81 Brady Martz INDEPENDENT AUDITOR'S REPORT Board of Commissioners Otter Tail County Housing and Redevelopment Authority Fergus Falls, Minnesota Report on the Audit of the Financial Statements Opinion We have audited the accompanying financial statements of the business-type activities of Otter Tail County Housing and Redevelopment Authority, a component unit of Otter Tail County, Minnesota, as of and for the year ended December 31 , 2025, and the related notes to the financial statements, which collectively comprise the Authority's basic financial statements as listed in the table of contents. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the business-type activities of Otter Tail County Housing and Redevelopment Authority, as of December 31 , 2025, and the changes in financial position and cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America. Basis for Opinion We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of Otter Tail County Housing and Redevelopment Authority, and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Emphasis of Matter As discussed in Note 1, the financial statements of Otter Tail County Housing and Redevelopment Authority are intended to present the net position, revenues, expenses and cash flows of only that portion of the financial statements of Otter Tail County, Minnesota that is attributable to the transactions of Otter Tail County Housing and Redevelopment Authority. They do not purport to, and do not, present fairly the financial position of Otter Tail County, Minnesota as of December 31 , 2025, the changes in its financial position or its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to this matter. Make Every Day Count I ww.bradymartz.com -2- 34/81 Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is ·required to evaluate whether there are conditions or events, .considered in the aggregate, that raise substantial doubt about Otter Tail County Housing and Redevelopment Authority's ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter. Auditor's Responsibilities for the Audit of the Financial Statements Our objectives are to obtain, reasonable assurance about whether the financial statements as a whole afe free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an· audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there ,is a substantial likeJihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we: • ,Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those, risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. • • Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Authority's internal control. Accordingly, no such opinion is expressed. • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. • Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Authority's ability to continue as a going concern for a reasonable period of time. -3-Make Every Day Count I www.bradymartz;com 35/81 We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit. Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management's discussion and analysis as listed in the table of contents be presented to supplement the basic financial statements. Such information is th!'! responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Supplementary Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Authority's basic financial statements. The combining schedules and capital fund costs are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining schedules and capital fund costs are fairly stated, in all material respects, in relation to the basic financial statements as a whole. Other Information Management is responsible for the other information included in the annual report. The other information comprises the Roster of Officials on page 1 but does not include the basic financial statements and our auditor's report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon. In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report. -4-Make Every Day Count I www.bradymartz.com 36/81 Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated June 30, 2026, on our consideration of the Authority's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and co111pliance and the results of ttiat testing, and not to provide an opinion on the effectiveness of Otter Tail County Housing and Redevelopment Authority's internal control over financial reporting or on compliance. That report is an integral part of ,an audit performed in accordance with Government Auditing Standards in considering the Authority's internal control over financial reporting and c:ompliance. ~)1~ BRADY MARTZ, PLLC GRANO FORKS, NORTH DAKOTA June 30; .2026 -5-Make Every Day Count I www.bradymilrtz.com 37/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE YEAR ENDED DECEMBER 31 , 2025 INTRODUCTION The Otter Tail County Housing and Redevelopment Authority's (the Authority) Management's Discussion and Analysis (MD&A) is designed to (a) assist the reader in focusing on significant financial information, (b) provide an overview of the financial activity, (c) identify changes in the financial position (its ability to address the next and subsequent year challenges), and (d) identify individual issues or concerns. Since the MD&A is designed to focus on the current year's activities, resulting changes, and current known facts, it should be read in conjunction with the Authority's financial statements. FINANCIAL HIGHLIGHTS Key financial highlights for the 2025 fiscal year include the following: • The assets of the Authority exceeded its liabilities at the close of the recent fiscal year by $5,849,495 (net position). Of this amount, $4,490,195 (unrestricted net position) may be used to meet the Authority's ongoing obligations to citizens and creditors. • The Authority's cash and cash equivalents balance at December 31 , 2025 was $4,185,473, representing an increase of $816,790 from December 31 , 2024. • The Authority had HUD Grant revenue of $765,237, a decrease of $69,279 from that earned in 2024. OVERVIEW OF THE FINANCIAL STATEMENTS The discussion and analysis is intended to serve as an introduction to the Authority's basic financial statements. The Authority's basic financial statements comprise two components: 1) Financial statements, and 2) Notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves. The Authority is a special-purpose government engaged only in Housing Assistance type activities and accounts for its financial activities as an enterprise fund. Accordingly, only business- activities financial statements are presented as the basic financial statements. The financial statements are prepared on the accrual basis of accounting. Therefore, revenues are recognized when earned and expenses are recognized when incurred. Capital assets are capitalized and depreciated, except for land, over their useful lives. See notes to the financial statements for a summary of the Authority's significant accounting policies and practices. The Authority's basic financial statements include the statement of net position, the statement of revenues, expenses and changes in net position, and the statement of cash flows. The statement of net position provides information about the nature and amount of assets and obligations (liabilities) of the Authority as of the end of the year. The statement of revenues, expenses and changes in net position reports revenues and expenses for the current year. The statement of cash flows reports cash receipts, cash payments, and net changes in cash resulting from operating activities, capital and related financing activities, and investing activities. -6- 38/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY MANAGEMENT'S DISCUSSION AND ANALYSIS -CONTINUED FOR THE YEAR ENDED DECEMBER 31, 2025 This . report also contains other supplementary information in addition to the basic• financial statements themselves. The Authority is a special-purpose government engaged only in Housing Assistance type activities and accounts for its financial activities as an enterprise fund. Accordingly, only businessaactivities financial statements are presented as the basic financial statements. The financial statements are prepared on the accrual basis of accounting. Therefore, revenues are re,cognized when earned arid expenses. are recognized when incurred. Capital assets are capitalized and depreciated, except for land, over their useful lives. See notes to th.e financial statements for a summary of the Authority's significant accounting p9licies and practices. USING THIS. ANNUAL REPORT Our auditors have provided assurance in their independent auditor's report, located immediately preceding this Management's Discussion an'd Analysis, that the Basic Financial Statements are fairly stated. Varying degrees .of assurance are being provided by the auditors regarding the other inforniati.on included in this report. A user of this report should read the . independent auditor's report carefully to ascertain the level of assurance being provided for each of the ot.her parts of this report. CHANGES IN NET POSITION , Total net position increased from the previous year by $1,022,768. The largest component of net position is unrestricted. Unrestricted .net position increased from the previous year by $954,661. FINANCIAL POSITION The following table summarizes the financial position of the Authority as of December 31, 2025 and 2024. Condensed Statement of Net Position Current assets Loans receivable, noncurrent Capital assets, net Total assets Current liabilities Long-term liabilities Total liabilities Net position Net investment in capital assets Restricted Unrestricted Total net position -7- $ 2025 4,293,492 295,554 2,056,966 6,646,012 75,431 721;086 796,517 1,300,554 58,746 4,490,195 $ $ 5,849,495 $ 2024 3,426,025 159,494 2,061,213 5,646,732 63,592 756,413 820,005 1,270,167 21,026 3,535,534 4,826,727 39/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY MANAGEMENT'S DISCUSSION AND ANALYSIS -CONTINUED FOR THE YEAR ENDED DECEMBER 31, 2025 The following table summarizes the changes in net position of the Authority for the years ended December 31, 2025 and 2024: Condensed Statement of Revenues, Expenses and Changes in Net Position 2025 2024 Operating revenues $ 1,061,853 $ 1,243,784 Operating expenses 1,676,920 1,733,725 Operating income (loss) (615,067) (489,941) Nonoperating income (loss) 1,637,835 1,533,358 Change in net position 1,022,768 1,043,417 Total net position -beginning of year 4,826,727 3,783,310 Total net position -end of year $ 5,849,495 $ 4,826,727 Operating revenues decreased by $181,931 as a result of a combination of factors. From prior year, grants from federal, state and local governments decreased by .approximately $259,000 and revenues from other sources experienced a decrease of approximately $31,000. Operating expenses decreased by $56,805 due to increases in contracted management services of approximately $75,000 and decreases in general expenses and housing assistance payments of $25,000 and $137,000, respectively. Federal grants totaled $765,237 for the year ended December 31, 2025 and $834,516 for the year ended December 31, 2024. Housing Units Managed The following table shows housing units managed by the. Authority for the years ended December 31, 2025 and 2024: Owned by Authority Units under vouchers Total housing units managed CAPITAL ASSETS 2025 2024 19 144 163 19 102 121 During 2025, there were additions for the Public Housing and North Fields of Dalton properties. There were no disposals of capital assets during 2025. Please see Note 5 for additional details. DEBT ADMINISTRATION As of December 31, 2025, the Authority had long-term debt for the North Fields of Dalton property, which carried a balance of $756,412 as of December 31, 2025. There was no new debt issued or obtained during 2025. Please see Note 7 for additional details. -8- 40/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY MANAGEMENT'S DISCUSSION AND ANALYSIS -CONTINUED FOR THE YEAR ENDED DECEMBER 31, 2025. ECONOMIC FACTORS The Otter Tail County Housing and Redevelopment Authority administers several programs aimed at providing affordable housing choices for individuals, families, and !leniors seeking both rental and owner-occupied housing. The Authority also operates rehabilitation programs in partnership with homeowners and rental property owners. From time to time, the Authority also responds to specific community requests for services to redevelop properties that, due to their condition, are obsolete or unsafe, and have a detrimental impact in the community. While the Authority receives federal funding from the Department" of Housing and Urban Developmeni (HUD) for its Housing Choice Voucher and Public Housing program, the Authority's budget is also bolstered by the Special Benefit Levy permitted in state law for housing authorities and other public or private funding sources. Combined, the Authority uses these. funding sources to accomplish its mission in partnership with cities and townships. REQUESTS FOR INFORMATION The annual financial report is designed to provide a genE!ral overview of the Authority's finances for all those with-an interest in the Authority's finances. Questions concerning any information provided in this report or requests for additional information should be addressed to Amy Baldwin, Executive Director,· Otter Tail County Housing and Redevelopment Authority, 500 W Fir Ave, Fergus Falls, Minnesota 56537. -9- 41/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY STATEMENT OF NET POSITION DECEMBER 31, 2025 Current assets Cash and cash equivalents Restricted cash Accounts receivable ASSETS Tenants, net of allowance for doubtful accounts Taxes receivable Loans receivable, current Prepaid expenses Total current assets Noncurrent assets Loans receivable, net of allowance for doubtful accounts Capital assets Noridepreciable Depreciable, net Total capital assets Total noncurrent assets T eta! assets Current liabilities Accounts payable Payment in-lieu of taxes Tenant security deposits Unearned revenue Accrued interest LIABILITIES AND NET POSITION Note payable, current portion Due to other governments Total current liabilities Long-term liabilities Note payable, net of current portion Total long-term liabilities Total liabilities Net position Net investment in capital assets Restricted for Section 8 HAP Unrestricted Total net position See Notes to the Financial Statements -10- $ 4,111,147 74,326 2,720 44,871 9,792 50,636 4,293,492 295,554 72,890 1,984,076 2,056,966 2,352,520 6,646,012 4,715 10,009 15,580 4,426 2,036 35,326 3,339 75,431 721,086 721,086 796,517 1,300,554 58,746 4,490,195 $ 5,849,495 42/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION_ FOR THE YEAR ENDED DECEMBER 31, 2025 Oper!'lting revenues Dwelling rentals HUD operating grants Operating subsidy Housing Choice Vouchers Other government grants Tenant utility charges Fraud recovery Other Total operating revenues Operating_expenses Service agreement fees Professional services Bad debt expense Advertising Office expense Travel Dues Staff training Consulting. fees Tenant services Utilities Repairs and maintenance Insurance General expenses Payments in lieu of taxes Housing assistance payments Depreciation Total operating expenses Operating income (loss) Nonoperating revenues (expenses) Interest income Interest expense Property taxes Capital grants Total nonoperating revenues (expenses) Change in net position Net position -beginning of year Net position -end of year See Notes to the Financial Statements st 1- $ 104,930 148,476 557;579 172,772 46,926 1,167 29,903 1,061,853 585,895 92,810 28,261 824 10,806 654 954 4,521 11,403 25,815 45,611 76,912 69,313 114;054 10,009 520,543 78,535 1,676;920 (615;067) 6,292 (15,973) 1,588,434 59,082 .. 1,637,835 1,022,768 4,826,727 $ 5,849,495 43/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2025 Cash flows from operating activities: Receipts from tenants Receipts from other governmental units Other receipts Payments to vendors Paymerits to other governmental units Payments for housing assistance Other payments Net cash provided (used) by operating activities Cash flows used by noncapital financing activities: Receipts from property taxes Net cash provided (used) by noncapital financing activities Cash flows from capital and related financing activities: Acquisition of capital assets Payments on notes payable Capital grants Interest paid Net cash provided (used) by capital and related financing activities Cash flows from investing activities: Payments received on loans receivable Issuance of loans Interest received Net cash provided (used) by investing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents -beginning of year Cash and cash equivalents -end of year Reconciliation of cash and cash equivalents Cash and cash equivalents Restricted cash -tenant security deposits Restricted cash -Section 8 HAP Total See Notes to the Financial Statements -12- $ $ 143,419 878,927 31,070 (377,610) (589,396) (520,543) (114,054) (548,187) 1,573,490 1,573,490 (74,288) (34,634) 59,082 (15,931) (65,771) 10,196 (159,230) 6,292 (142,742) 816,790 3,368,683 4,185,473 $ 4,111,147 15,580 58,746 $ 4,185,473 44/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY STATEMENT OF CASH FLOWS-CONTINUED FOR THE YEAR ENDED DECEMBER 31, 2025 Operating income (loss) Adjustments to reconc.ile operating income (loss) to net cash from operating activities: Depreciation . Bad debt expense (recovery) Changes in assets and liabilities Accounts receivable • Prepaid expenses Accounts payable Payments in lieu of taxes Tenant security deposits Unearned revenue Due to other governments Cash flows from operating activities Schedule of noncash investing, capital and financing activities: Forgiveness of loans receivable See Notes to the Financial Statements -13C $ (615,067) 78,535 28,261 (16,396) (34,625) (3,364) 6,059 4,692 3,267 449 $ (548,187) $ 76,647 45/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS DECEMBER 31, 2025 ' NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations Otter Tail County Housing and Redevelopment Authority (the Authority) is a separate legal entity formed by Otter Tail County, Minnesota under the State of Minnesota statutes. The Authority was formed to own and operate housing for low-income clients, which is accounted for in the Low Rent Public Housing activity. The Authority has an agreement with the Housing and Urban Development (HUD) to help individuals and families procure decent and affordable housing by subsidizing their rent payments (Housing Choice Vouchers Program), which is accounted for in the Section 8 Housing Choice Vouchers activity. The Authority makes up the sole membership of Finding Home I, LLC, an organization that owns two triplex units in Dalton, MN. The Authority manages the properties and accounts for operations in the Finding Home activity. All other activities of the Authority are accounted for in the General & State/Local activity. The Authority, a component unit of Otter Tail County, Minnesota, was established in 1972 and is governed by a five-member Board of Commissioners who are appointed by the Otter Tail County Board of Commissioners. General The accounting policies of the Authority conform to accounting principles generally accepted in the United States of America. Basis of Accounting The Authority is a governmental entity and uses the proprietary fund model to account for its operations; therefore, the accrual basis of accounting is followed. Under this method of accounting, revenues are recognized when earned and expenses are recognized when incurred. When both restricted and unrestricted resources are available for use, it is the Authority's policy to use restricted resources first and then unrestricted resources as needed. Basis of Presentation The funds of the Otter Tail County Housing and Redevelopment Authority are presented as proprietary funds. Proprietary funds are used to account for operations financed and operated in a manner similar to private business enterprises, where the intent of the governing body is that the costs of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund 's principal ongoing operations. Operating revenues include intergovernmental revenue and property taxes. Operating expenses for proprietary funds include the cost of service agreement fees, contract services, housing assistance payments, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. -14- 46/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS -CONTINUED DECEMBER 31, 2025 The Authority reports on the following programs: The General & State/Local Fund accounts for money levied under state statute through Otter Tail County. These funds are used for both owner-occupied and rental rehabilitation throughout Otter Tail County, excluding the City of Fergus Falls. Owner- occupied loans are deferred over ten years and forgiven if the property remains owner occupied. these funds may also· be used to cover unreimbursed administration expenses in the Authority's other programs. The Low Rent Public Housing Program Fund is used to account for the operations of the 13 units (nine buildings) of family public housing that are rented to families who meet the low-income guidelines as established by the U.S. Department of Housing and Urban Development (HUD). Revenues for continuing operations consist primarily of dwelling rentals and operating subsidies from HUD. The Public Housing Capital Fund Program is used to account for grant funds provided to the Authority by HUD annually for capital and management activities, including the ongoing modernization of its public housing stock. The funds received for this program are transferred to the Low-Rent Public Housing Program. The Section 8 Housing Choice Voucher Program is used to account for the operation of the income-based program, which. is funded by HUD. HUD contracts with the Authority, which,, in turn, contracts with owners of rental housing. to make assistance payments on the tenant's behalf. Payments made to the owners are generally the difference between the local payment standard and 30 percent of the family's adjusted gross income. The Finding Home Fund is used to account for the operations of the Affordable ·Senior Housing Program. Revenues for continuing operations consist primarily of dwelling rents at the North Fields of Dalton development. Cash and Qash Equivalents The Authority's cash and cash equivalents consist of savings and checking accounts, cash on hand, and certificates of deposit. Restricted cash. is shown separately from cash and cash equivalents. Receivables Property tax levies are set by the Authority and are certified to Otter Tail County each year for collection in the following year. In Minnesota, counties act as collection agents for all property taxes. Real property taxes are generally due from taxpayers in equal installments on May 15 and October 15. The County remits tax settlements to the Authority at various times during the year. Taxes collectible in a given calendar year are generally recognized as revenue during that fiscal year. Amounts due from individuals and organizations are recorded as receivables at year-end. Receivables in the Low Rent Public Housing Program Fund have been shown net of an allowance for uncollectible accounts of $200. -15- 47/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS-CONTINUED DECEMBER 31, 2025 Prepaid Expenses Certain payments to vendors reflecting expenses applicable to future accounting periods are recorded as prepaid expenses. Unearned Revenue As of December 31, 2025, the Authority has unearned revenue of $4,426, which represents prepaid tenant rent. Restricted Assets Certain funds of the Authority are classified as restricted assets on the statement of net position because the restriction is either imposed by law through constitutional provisions or enabling legislation or imposed externally by creditors, grantors, contributors, or laws or regulations of other governments. Therefore, their use is limited by applicable laws and regulations. Capital Assets Capital assets, which include land and buildings, are reported in the fund financial statements. Capital assets are defined by the Authority as assets with an initial, individual cost of more than $5,000 and an estimated useful life in excess of three years. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at acquisition value. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend lives are not capitalized. Capital assets are depreciated using the straight-line method over their useful lives (5-50 years). The estimated useful lives are as follows: Buildings and improvements Furniture, equipment and machinery Vehicles -16- 10-50 years 5-10 years 3 years 48/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS -CONTINUED DECEMBER 31, 2025 Net Position Classification Net position is classified and displayed in three components: a. Net investment in capital assets -Consists of capital assets including restricted capital assets, net of accumulated depreciation and reduced by the outstanding balances of any bonds, mortgages, notes, or other borrowings that are attributable to the acquisition·, construction, or improvement of those assets. b. Restricted net position -Consists of net position with constraints placed on the use either by (1) external groups such as creditors, grantors, contributors, or laws or regulations cif other governments; or (2) law through constitutional provisions -or enabling legislation. c. Unrestricted net position -All other net position that does not meet the definition of "restricted" or "invested in capital assets." Estimates The preparation of financial statements. in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amount~ of revenues ana expenses during the reporting period. Actual results coula differ from those estimates. NOTE 2 DEPOSITS AND INVESTMENTS Deposits In accordance with Minnesota statutes, the Authority maintains deposits at those depository banks and brokerages authorized by the Authority Commission, all of which are covered by Federal Depository Insurance. Statutes require that all Authority deposits be protected by insurance, collateral, or surety bonds. The market value of the collateral pledged must.be equal to or· greater than 110% of the deposits not covered by insurance or bonds. At December 31, 2025, the carrying amount of the Authority's deposits was $4,185,473 and the bank balance was $4,333,899. The entire bank balance was covered by the Federal Depository Insurance Corporation (FDIC) and pledged collateral at December 31, 2025. Interest Rate Risk The Authority does not have a formal investment policy that limits investment maturities as a means of managing its exposure to fair value losses arising from changing .interest rates. -17- 49/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS -CONTINUED DECEMBER 31, 2025 Credit Risk The Authority may invest idle funds in deposits that are properly secured by FDIC insurance coverage and are with designated depositories, which meet or exceed the Governmental National Mortgage Association Ratings. NOTE 3 RESTRICTED CASH Restricted cash consists of $10,925 in Low Rent Public Housing tenant security deposits, $58,746 restricted for HUD Section 8 vouchers, and $4,655 in Finding Home tenant security deposits. NOTE 4 LOANS RECEIVABLE The Authority offers several loan programs through its General & State/Local Fund. The loans due are from homeowners and landlords for assistance purchasing or rehabilitating properties. Homeowner rehab loans are "deferred loans" that are completely forgiven after ten years if all conditions are met. If the rehabilitated property is not sold, transferred, or otherwise conveyed within ten years, the conditions are met, and no repayment shall be due, the loan will be forgiven. If the conditions are not met, the recipient shall repay the principal amount of the loan, and the Authority shall have a lien for repayment of all funds. It is estimated that conditions are likely to be met by the borrower, and an allowance for the full amount of outstanding homeowner rehab loans has been recognized to offset the loan balance. Rental rehab loans are required to be paid back by the landlords in monthly payments, typically over ten years with a zero percent interest rate. Loans may have a forgivable portion, typically 25 percent, which will be forgiven after the first five years of loan compliance. The initial loan is reduced by the 25 percent forgivable portion when recorded on the books at inception. Down payment assistance loans are written for the term of the original mortgage on the home. The loans have a zero percent interest rate. The loans are to be repaid at final payment of original mortgage, upon loan refinancing, or upon sale or transfer ofthe property. The Authority records the loan at face value at inception, and it remains at that value until paid or written-off. Tax levy rehab loans are "deferred loans" that are forgivable at ten percent each year and completely forgiven after ten years, if all conditions are met. If the rehabilitated property is not sold, transferred, or otherwise conveyed within ten years, the conditions are met, and no repayment shall be due, the loan will be forgiven. If the conditions are not met, the recipient shall repay the principal amount of the loan, and the Authority shall have a lien for repayment of all funds. It is estimated that conditions are likely to be met by the borrower, and an allowance for the full amount of outstanding tax levy rehab loans has been recognized to •offset the loan balance. -18- 50/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENTAUTHORITY NOTES TO THE FINANCIAL STATEMENTS -CONTINUED DECEMBER 31, 2025 Loans receivable activity for the year ended December 31, 2025, was as follows: Beginning Ending Balance Balance Due Within 1/1/2025 Additions Retirements, 12/31/2025 one Year Loan receivable Homeowner rehab $ 19,698 $ 11,391 $ (19,698) $ 11 ;391 $ Rental rehab 44,478 (10,196) 34,282 9,792 Down payment assistance 124,920 146,144 271,064 Tax levy rehab provi~ion 201,863 1,695 (56,949) 146,609 Total 390,959 159,230 (86,843) 463,346 9,792 Allowance for dou_btful accounts: HOnieowner r~hab (25,577) (11,391) 19,698 (17,270) Tax levy rehab provision (195,984) (1,695) 56,949 (140,730) total (221,561) (13,086) 76,647 (158,000) Total loan receivable, net $ 169,398 $ 146,144 $ (10,196) $ 305,346 $ 9,792 NOTES CAPITAL ASSETS The Authority's capital asset activity for the year ended December 31, 2025, was as follows: Beginning Ending Balahce Balance 1/1/2025 Additions Retirements Transfers 12/31/2025 'Capital assets, not being depr~ciated: Land $ 72,890 $ $ $ $ 72,890 Construction in progress 96,638 14,680 (111,318) Total capital assets not being depreciated 169,528 14,680 (111,318) 72,890 Capital assets, being depreciated: Buildings and ir:r)prover:nents 3,047,564 59,608 111,318 3,218,490 Total capital assets being depreciat~d 3,047,564 59,608 111,318 3,218,490 Less accumulated.depreciation for: Buildings and improvements (,1, 155,879) (78,535) (1,234,414) Total accumulated depreciation (1,155,879) (78,535) (1,234,414) Total capital assets, being depreciated -net 1,891,685 (18,927) r .. 111,318 1,984,076 Total capital assets $ 2,061,213 $ (4,247) $ . -$ $ 2,056,966 NOTES DUE TO OTHER GOVERNMENTS The Authority has $3,339 due to several local municipalities for utilities charges incurred but not paid as of December 31, 2025. -19- 51/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS-CONTINUED DECEMBER 31, 2025 NOTE 7 LONG-TERM LIABILITIES In March 2024, the Authority obtained project financing assistance from Otter Tail County of $825,000 to fund the North Fields of Dalton project. The agreement is a 20-year agreement maturing in November 2043 with annual payments totaling $50,454 at a 2% interest rate. The following is a summary of the activity in long-term liabilities for the year: Interest Balance Balance Current Rate 1/1/2025 Additions Retirements 12/31/2025 Maturities North Fields of Dalton Loan 2.00% $ 791.046 s -$ (34,634) $ 756.412 $ 35,326 Totals $ 791.046 $ $ (34,634) $ 756.412 $ 35,326 Th e debt requirements to maturity for long-term liabilities are as follows: Principal Interest Total 2026 $ 35,326 $ 15,128 $ 50,454 2027 36,032 14,422 50,454 2028 36,753 13,701 50,454 2029 37,488 12,966 50,454 2030 38,238 12,216 50,454 2031-2035 202,974 49,296 252,270 2036-2040 224,097 28,173 252,270 2041-2043 145,504 8,711 154,215 Totals $ 756,412 $ 154,613 $ 911,025 NOTES ANNUAL CONTRIBUTIONS CONTRACT The Authority has an annual contributions contract for Section 8 Housing Choice Vouchers and adjustments vary based on requirements. The total of administrative and HAP revenues was $645,588 for 2025. NOTE 9 RISK MANAGEMENT The Authority is exposed to various risks of losses including general liability, property damage and employee bodily injury. The insurance coverage is considered to be adequate to cover unexpected claims against the Authority. The Authority retains the responsibility to cover any settlements exceeding the specific coverage. There was no reduction in coverage from the prior year and settlements have not exceeded insurance coverage in the past three years. NOTE 10 COMMITMENTS AND CONTINGENCIES Grants The Authority participates in federal grant programs, which are governed by various rules and regulations of the granter agency. Costs charged to the respective grant programs are subject to audit and adjustment by the granter agency; therefore, to the extent that the Authority has not complied with the rules and regulations governing the grants, refunds of any money received may be required and the collectability of any related receivable at December 31, 2025, may be impaired. In the opinion of the Authority, there are no significant contingent liabilities relating to -20- 52/81 OTTER.TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS -CONTINUED DECEMBER 31, 2025 compliance with the rules and regulations governing the respective grants; therefore, no provision has been recorded in the accompanying financial statements for such .contingencies. NOTE 11 MANAGEMENT FEES The Authority has a management contract with Otter Tail County. Under this contract, the County will provide on-site workspace, internet access, technology, technological support, and office related functions to the Authority as needed. The County will make County employees available to support operations and purposes of the Authority. The services under the agreement began on January 1, 2022, arid are renewed automatically for additional one-year terms. Either party may terminate this agreement early, upon not less than 90 days' notice given in writing prior to the end of the fiscal year. The management fee paid by the Authority was $585,895 for the year ended December 31, 2025. NOTE 12 NEW PRONOUNCEMENTS GASB Statement No. 103, Finanqial Reporting Model Improvements, revises the requirements for management's discussion and analysis with the goal of making it .more readable and understandable, requires unusual or infrequent items to be .presented separately, defines operating and nonoperating revenues, includes a new section for noncapital subsidies for proprietary funds' statement of revenues, expenses and changes in net position, removes the option to disclose major component information in the notes and requires them to be shown individually or in combine financial statements following the fund financial statements and requires budgetary comparisons to be presented as RSI with new columns for variances between original-to-final budget and final budget-to-actual results. This statement is effective for fiscal years beginning after June 15, 2025. GASB Statement No. 104, Disclosure of Certain Capital Assets, establishes requirements for certain types of capital assets to be disclosed separately in the capital assets note. These items include disclosing separately lease assets, intangible right-to-use assets, subscription assets and intangible assets. In addition, additional disclosures will. be required for capital assets held for sale. This statement is effective for fiscal years beginning after June 15, 2025. Earlier application is encouraged. GASB Statement No. 105, Subsequent Events, defines subsequent events as transactions or other events occurring after the financial statement date but before the statements are available for issuance. Financial statements are considered al(ailable for issuance when they are . complete in accordance with generally accepted accounting principles and have received all required approvals. The Statement also requires disclosure of the date through, which subsequent events were evaluated and clarifies the distinction between .recognized and nonrecognized subsequent events, including related note .disclosure requirements. This statement is effective for fiscal years beginning after June 15, 2026. Earlier application is encouraged. Management has not yet determined the effect these pronouncements will have on the Authority's financial statements. -21- 53/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS -CONTINUED DECEMBER 31, 2025 NOTE 13 SUBSEQUENT EVENTS No significant events occurred subsequent to the Authority's year end. Subsequent events have been evaluated through June 30, 2026, which is the date the financial statements were available to be issued. -22- 54/81 SUPPLEMENTARY INFORMATION 55/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY COMBINING SCHEDULE OF NET POSITION DECEMBER 31, 2025 Section B Low Rent Housing General & Public Choice Finding State/Local Housing Vouchers Home Totals ASSETS Current assets Cash and cash equivalents $ 3,935,492 $ 91,756 $ 54,118 $ 29,781 $ 4,111,147 Restricted cash 10,925 58,746 4,655 74,326 Accounts receivable Tenants, net of allowance for doubtful accounts 1,565 1,155 2,720 Taxes receivable 44,871 44,871 Loans receivable, current 9,792 9,792 Prepaid expenses 16,062 28,850 5,724 50,636 Total current assets 4,006,217 133,096 112,864 41,315 4,293,492 Noncurrent assets Loans receivable, net of allowance for doubtful accounts 295,554 295,554 Capital assets Nondepreciable 26,400 32,990 13,500 72,890 Depreciable, net 546,900 1,437,176 1,984,076 Total capital assets (net) 26,400 579,890 1,450,676 2,056,966 Total noncurrent assets 321,954 579,890 1,450,676 2,352,520 Total assets $ 4,328,171 $ 712,986 $ 112,864 $ 1,491,991 $ 6,646,012 -23- 56/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY COMBINING SCHEDULE OF NET POSITION -CONTINUED DECEMBER 31, 2025 Section 8 Low Rent Housing General & Public Choice Finding State/Local Housing Vouchers Home Totals LIABILITIES AND NET POSITION Current liabilities Accounts payable $ -$ 1.,437 $ 1,355 $ 1,923 .$ 4,715 Payment in ·lieu of taxes 6,429 3,580 10,009 Tenant security deposits 10,925 4,655 15,580 Unearned revenue. 2,604 1,822 4,426 Accrued interest 2,036 2,036. Note payable, .current portion 35,326 35;326 Due to other governments 3,339 3,339 Total current liabilities 37,362 24,734 1,355 11,980 . 75,431 Long-term liabilities Note payable, net of current portion 721,086 721,086 Total long-term liabilities 721,086 721,086 Total liabilities 758,448 24,734 1,355 11,980 796,517 Net position Net investment in capital assets (730,012) 579,890 1,450,676 1,300,554 Restricted -58,746 58;746 Unrestricted (deficit) 4,299,735 108,362 52,763 29,335 4,490,195 Total riet position $ 3,569,723 $ 688,252 $ 111,509 $ 1,480,011 $ 5,849,495 -24- 57/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY COMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN NET POSITION FOR THE YEAR ENDED DECEMBER 31, 2025 Section 8 Low Rent Housing General & Public Choice Finding State/Local Housing Vouchers Home Totals Operating revenues Dwelling rents $ -$ 64,927 $ -$ 40,003 $ 104,930 HUD operating grants Operating subsidy 60,567 87,909 148,476 Housing Choice Vouchers 557,679 557,679 Other government grants 172,772 172,772 Tenant utility charges 46,926 46,926 Fraud recovery 1,167 1,167 Other 28,868 911 124 29,903 Total operating revenues 201 ,640 173,331 646,755 40,127 1,061 ,853 Operating expenses Service agreement fees 493,646 25,000 67,249 585,895 Professional services 90,410 2,400 92,810 Bad debt expense 13,086 15,175 28,261 Advertising 561 263 824 Office expense 4,076 2,202 4,528 10,806 Travel 35 203 399 17 654 Dues 954 954 Staff training 894 229 3,398 4,521 Consulting fees 5,881 2,309 3,213 11,403 Tenant services 25,815 25,815 Utilities 38,248 7,363 45,611 Repairs and maintenance 14,211 48,135 14,566 76,912 Insurance 33,317 30,965 5,031 69,313 General expenses 108,285 969 4,800 114,054 Payments in lieu of taxes 6,429 3,580 10,009 Housing assistance payments 520,543 520,543 Depreciation 46,887 31,648 78,535 Total operating expenses 791 ,171 219,151 604,130 62,468 1,676,920 Operating income (loss) (589,531) (45,820) 42,625 (22,341) (615,067) Nonoperating revenues (expenses) Interest income 6,065 103 103 21 6,292 Interest expense (15,864) (79) (30) (15,973) Property taxes 1,588,434 1,588,434 Capital grants 59,082 59,082 Transfers in 14,680 14,680 Transfers out (14,680) (1 4,680) Total nonoperating revenues (expenses) 1,563,955 59,106 103 14,671 1,637,835 Change in net position 974,424 13,286 42,728 (7,670) 1,022,768 Net position -beginning of year 2,595,299 674,966 68,781 1,487,681 4,826,727 Net position -end of year $ 3,569,723 $ 688,252 $ 111,509 $ 1,480,011 $ 5,849,495 -25- 58/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY COMBINING SCHEDULE OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2025 Section 8 Low Rent Housing General & Public Choice Finding State/Local Housing Vouchers Home Totals Cash flows from operating activities: Receipts from tenants $ -$ 100,469 $ -$ 42,950 $ 143,419 Receipts from other governmental units 172,772 60,567 645,588 878,927 Other receipts 28,868 911 1,167 124 31 ,070 Payments to vendors (179,913) (153,581) (12,133) (31 ,983) (377,610) Payments to other governmental units (493,646) (28,351) (67,249) (150) (589,396) Payments for housing assistance (520,543) (520,543) Other payments (108,285) (969) (4,800) (114,054) Net cash provided (used) by operating activities (580,204) (20,954) 42,030 10,941 (548,187) Cash flows used by noncapital financing activities: Receipts from property taxes 1,573,490 1,573,490 Transfers (to) from other funds 14,680 14,680 Transfers to other funds (14,680) (14,680) Net cash provided (used) by noncapital financing activities 1,558,810 14,680 1,573,490 Cash flows from capital and related financing activities: Acquisition of capital assets (59,608) (14,680) (74,288) Payments on loans payable (34,634) (34,634) Capital grants 59,082 59,082 Interest paid (15,822) (79) (30) (15,931) Net cash provided (used) for capital and related financing activities (50,456) (605) (14,710) (65,771) Cash flows from investing activities: Payments received on loans receivable 10,196 10,196 Issuance of loans receivable (159,230) (159,230) Interest received 6,065 103 103 21 6,292 Net cash provided (used) for investing activities (142,969) 103 103 21 (142,742) Net increase (decrease) in cash and cash equivalents 785,181 (21 ,456) 42,133 10,932 816,790 Cash and cash equivalents, Beginning of year 3,150,311 124,137 70,731 23,504 3,368,683 Cash and cash equivalents, End of year $ 3,935,492 $ 102,681 $ 112,864 $ 34,436 $ 4,185,473 Reconciliation of cash and cash equivalents Cash $ 3,935,492 $ 91,756 $ 54,118 $ 29,781 $ 4,111 ,147 Restricted cash 10,925 58,746 4,655 74,326 TOTAL $ 3,935,492 $ 102,681 $ 112,864 $ 34,436 $ 4,185,473 -26- 59/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY COMBINING SCHEDULE OF CASH FLOWS -CONTINUED FOR THE YEAR ENDED DECEMBER 31 , 2025 Reconciliation of cash flows from operating activities General & State/Local Low Rent Public Housing Section 8 Housing Choice Vouchers Finding Home Operating income 0oss) Adjustments to reconcile operating income 0oss) to net cash from operating activities: $ (589,531) $ (45,820) $ 42,625 $ (22,341) $ Depreciation Bad debt expense (recovery) Changes in assets and liabilities: i\ccounts receivable Prepaid expenses i\ccounts payable Payments in lieu of taxes Tenant security deposits Unearned revenue Due to other governments Cash flows provided (used) by operating activities Schedule of noncash investing, capital and financing activities: Forgiveness of loans receivable 13,086 (51) (3,708) $ (580,204) $ $ 76,647 $ -27- 46,887 31 ,648 15,175 (15,241) (1,155) (28,850) (5,724) (40) (595) 981 2,629 3,430 1,687 3,005 2,170 1,097 449 (20,954) $ 42,030 $ 10,941 $ . $ . $ . $ Totals (615,067) 78,535 28,261 (16,396) (34,625) (3,362) 6,059 4,692 3,267 449 (548,187) 76,647 60/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY SCHEDUL.E OF CAPITAL FUND COSTS FOR THE YEAR ENDED DECEMBER 31, 2025 Grant Year Grant Year Grant Year Grant Year 2025 2024 2023 2022 Grant Year 2020 MN46P17750124 MN46P17750124 MN46P17750123 MN46P17750123 MN46P17750123 Funds Approved $ 49,784 $ 43,824 $ 42,596 $ 33,107 $ 41,622 Funds Expended 7000 23,986 36374 33,107 41,622 Excess of Funds Approved $ 42,784 $ 19,838 $ 6,222 $ -$ -28- 61/81 Brady Martz INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS To the Board of Commissioners Otter Tail County Housing and Redevelopment Authority Fergus Falls, Minnesota We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the business-type activities of Otter Tail County Housing and Redevelopment Authority as of and for the year ended December 31, 2025, and the related notes to the financial statements and have issued our report thereon dated June 30, 2026. Report on Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered the Authority's internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Authority's internal control. Accordingly, we do not express an opinion on the effectiveness of the Authority's internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses or significant deficiencies may exist that were not identified. -29- Make Every Day Count I ww.bradymartz.com 62/81 Report on Compliance and Other Matters As part of obtaining reasonable assurance about whether the Authority's financial statements are free from material misstatement, we performed tests of its . compliance with certain provisions of laws, regulations, contracts, and grant agreements, :nonacompliance with which could have a direct and material ·effect. on the financial statements. However, providing an opinion on compliance with those provisions was not .an objective of our .audit, and accordingly, we do not express such an opinion. The results of our tests disclosed Tio instances of noncompliance or other matters that .are required to be reported under Government Auditing Standards. Purpose ot'this Report The purpose of this report is sole_ly to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion ·on the effectiveness of the . entity's internal controi or on compiiance. This report is ari integral _part of. an .audit performed in accordance with Government Auditing Standards in considering the entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. ~AMl;y BRADY MARTZ, PLLC GRAND FORKS, NORTH DAKOTA June 30, 2026 -30-Make Every Day Count I www.bradymartz.com 63/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY SCHEDULE OF FINDINGS AND RESPONSES FOR THE YEAR ENDED DECEMBER 31, 2025 There are no findings which are required to be reported under this section. -31- OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY REQUEST FOR BOARD ACTION August 5, 2026 BOARD MEETING DATE AGENDA ITEM # 4B Amy Baldwin 07/27/2026 REQUESTOR’S SIGNATURE/DATE BOARD ACTION REQUESTED Resolution No. 337 Adopt Special Benefit Levy for Taxes Payable 2027 PROPOSED REQUEST/JUSTIFICATION The proposed levy request for taxes payable in 2027 is $1,610,431. The levy is a crucial resource in accomplishing the HRA strategic initiatives; Strengthening Communities Initiative: “Create New Homes” and the Housing Stability Initiative: “Keeping People in Their Homes”. CREATE NEW HOMES The HRA has been awarded Impact Funds from MN Housing to construct and sell seven homes over the next two years in Parkers Prairie, New York Mills, and Pelican Rapids. These homes will expand homeownership opportunities for income-eligible households and help address the growing need for workforce housing in the region. In addition, construction is anticipated to begin later this year on six affordable senior housing units in New York Mills, further increasing housing options for active seniors. KEEP PEOPLE IN THEIR HOMES The HRA administers a variety of federal and state housing programs that help low-income households remain safely and affordably housed. Rental assistance programs provide stable housing opportunities, while Housing Trust Fund programs offer down payment assistance for first-time homebuyers and rehabilitation assistance for both single-family and multifamily property owners. Housing rehabilitation programs preserve the quality, safety, and livability of existing homes while protecting neighborhood property values and extending the useful life of the community's housing stock. The HRA will also continue its partnership in 2027 with the City of Pelican Rapids to administer the Small Cities Development Program (SCDP) Grant, providing rehabilitation assistance for owner-occupied homes and commercial properties through the grant's closeout in September of next year. Earlier this year, the HRA submitted an SCDP application on behalf of the City of New York Mills to support the rehabilitation of additional owner-occupied homes. HRA's work is built on strong partnerships with local communities. Staff provides technical expertise to help communities identify and implement housing initiatives and, when authorized by the HRA Board, leverages financial resources to address local housing needs and expand housing opportunities. Staff recommends the Board adopt the Resolution as presented, which maintains the same level of special benefit levy funding for the HRA for 2027. PREVIOUS ACTION ON REQUEST/OTHER PARTIES ADVISED EXECUTIVE DIRECTOR DATE: Amy Baldwin 7/27/2026 ATTACHMENT LIST: Resolution No. 337 FINANCIAL IMPLICATIONS: $1,610,431 BUDGETED: Pending YES NO FUNDING: Tax Levy 64/81 RESOLUTION NO. 337 APPROVE SPECIAL BENEFIT LEVY FOR TAXES PAYABLE IN 2027 FOR THE OTTER TAIL COUNTY HRA WHEREAS, the Otter Tail County Housing and Redevelopment Authority (the “Authority”) is empowered by Minnesota Statute 469 to collect a Special Benefit Levy in an amount not to exceed .0185% of the estimated market value; and WHEREAS, the Authority has determined that $1,610,431 is necessary to effectuate the strategic initiatives for 2027; and NOW, THEREFORE, IT IS HEREBY RESOLVED: 1. That $1,610,431 is requested for the Otter Tail County HRA. 2. That the Executive Director is authorized to communicate the amount to the County Auditor in a timely fashion. Upon the motion of______________, second by_______________________, and passed on a ___________________vote, the above resolution is hereby adopted by the Otter Tail County Housing and Redevelopment Authority Board of Commissioners. Adopted this 5th day of August 2026. Dated: _______________________________ OTTER TAIL COUNTY HRA BOARD OF COMMISSIONERS Attest:________________________________ By:_______________________________ 65/81 OTTER TAIL COUNTY HOUSING AND REDEVELOPMENT AUTHORITY REQUEST FOR BOARD ACTION August 5, 2026 BOARD MEETING DATE AGENDA ITEM #5A Amy Baldwin July 27, 2026 REQUESTOR’S SIGNATURE/DATE BOARD ACTION REQUESTED Approval of Resolution No. 338 Approving the Sale of Real Property and a Purchase and Development Agreement for HRA Owned Property in Vergas, Minnesota PROPOSED REQUEST/JUSTIFICATION As directed at the July 8, 2026, HRA board meeting, staff worked with the HRA’s Attorney Dan Burns to draft a Purchase and Development Agreement for HRA owned property located at 205, 225 and 235 Eva Street in Vergas to be sold to JRMH Holdings to construct and sell a single-family home. The Agreement includes the terms of sale that were posted for public comment and discussed at the last board meeting. They include: • The home will be completed within two years from effective date of Agreement • The home will be constructed pursuant to the proposal • The home will be sold to an income qualified buyer (115% of the State AMI) Property would be sold to JRMH Holdings for $6,600 (total) and conveyed by Quit Claim Deed. Recommendation: Staff recommends approval of Resolution No. 338 PREVIOUS ACTION ON REQUEST/OTHER PARTIES ADVISED: N/A EXECUTIVE DIRECTOR DATE: Amy Baldwin 07/27/2026 ATTACHMENT LIST: Resolution No. 338 Exhibit A Purchase and Development Agreement FINANCIAL IMPLICATIONS: General Levy Fund revenue BUDGETED: YES X NO FUNDING: N/A COMMENTS 66/81 RESOLUTION NO. 338 RESOLUTION APPROVING THE SALE OF REAL PROPERTY, AND A PURCHASE AND DEVELOPMENT AGREEMENT FOR HRA OWNED PROPERTY IN VERGAS, MINNESOTA WHEREAS, the HRA was created pursuant to Minnesota Statutes, Sections 469.001 through 469.047, as amended (the “Act”); WHEREAS, the Act authorizes the HRA to, among other things, sell and convey real property for the development of housing projects; WHEREAS, the HRA owns certain parcels of real property, identified by the parcel numbers listed in Exhibit A attached hereto (the “Properties”), and desires to sell the Properties for a proposed housing development; WHEREAS, JRMH Holdings (the “Developer”) has proposed to the HRA to acquire the Properties and to build an owner-occupied single-family dwelling thereon (the “Project”); WHEREAS, pursuant to the Act, the Board held a duly noticed public hearing on July 8, 2026, regarding the sale of the Properties, at which time all persons desiring to speak on the matter where heard; WHEREAS, the terms and conditions of the sale of the Properties (the “Terms”) are and have been on file in the County Administration office, available for public inspection; WHEREAS, the Terms include, among other things, that the Project be sold to an individual or family of low or moderate income, whose annual gross income does not exceed 115% of the Median Family Income for the State of Minnesota as determined by the U.S. Department of Housing and Urban Development (the “Affordability Restriction”); WHEREAS, the HRA desires to sell and convey the Properties, and the Developer desires to purchase and develop the Properties, pursuant to the Terms, which have been incorporated into a Purchase and Development Agreement (the “Agreement”), which has been submitted to the Board for its review and consideration; WHEREAS, the Board hereby finds that the sale and conveyance of the Properties pursuant to the Terms and Agreement are advisable, and in the best interests of the HRA, Otter Tail County, Minnesota (the “County”), and its residents; WHEREAS, the Board also finds that the proposed sale and conveyance of the Properties and the construction of the Project further the general development plans of the HRA and the County; WHEREAS, the Board further finds that the aggregate estimated market value of the Properties equals $26,400. 67/81 NOW, THEREFORE, IT IS HEREBY RESOLVED: 1. The Agreement, as presented to the Board, is hereby approved. The Chair and Executive Director of the HRA are authorized and directed in the name and on behalf of the HRA to execute the Agreement, with such changes the Chair and Executive Director shall deem necessary and appropriate. 2. The Board hereby authorizes and directs the Chair and Executive Director, as well as staff of the HRA, to perform all actions and execute all instruments necessary to carry out the Board’s intent as described in and subject to this resolution. Upon the motion of _______________, seconded by _________________, and passed on a ___________________ vote, the above resolution is hereby adopted by the Otter Tail County Housing and Redevelopment Authority Board of Commissioners. Adopted this 5th day of August, 2026. Dated: _______________________________ OTTER TAIL COUNTY HRA BOARD OF COMMISSIONERS Attest:________________________________ By:_______________________________ 68/81 EXHIBIT A PURCHASE AND DEVELOPMENT AGREEMENT BETWEEN THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR OTTER TAIL COUNTY AND JRMH HOLDINGS LLC This Purchase and Development Agreement (this “Agreement”), dated _______________, 2026 (the “Effective Date”), between the Housing and Redevelopment Authority in and for Otter Tail County, Minnesota (the “HRA”) and JRMH Holdings LLC (the “Developer”) is for the purchase and development of certain Properties (as defined herein) within the City of Vergas, Minnesota, and owned by the HRA. RECITALS WHEREAS, the HRA was created pursuant to Minnesota Statutes, Sections 469.001 through 469.047, as amended (the “Act”), for the purposes of the Act; WHEREAS, the Act authorizes the HRA to, among other things, sell and convey real property for the development of housing projects; WHEREAS, the HRA owns certain parcels of real property, legally described, and identified by the parcel numbers listed, in Exhibit A attached hereto (the “Properties”), and desires to sell the Properties for a proposed housing development; WHEREAS, the Developer has proposed to the HRA to acquire the Properties and to build an owner-occupied single-family dwelling thereon (the “Project”), as further described herein and in the proposal attached hereto as Exhibit B (the “Proposal”); WHEREAS, pursuant to the Act, the Board of Commissioners of the HRA (the “Board”) held a duly noticed public hearing on July 8, 2026, regarding the sale of the Properties, at which time all persons desiring to speak on the matter where heard; and WHEREAS, on August 5, 2026, the Board approved this Agreement, and the sale and conveyance of the Properties pursuant to this Agreement; and WHEREAS, the HRA desires to sell and convey the Properties, and the Developer desires to purchase and develop the Properties, and to construct the Project, pursuant to the terms and conditions of this Agreement; NOW, THEREFORE, in consideration of the terms, conditions, and mutual agreements by and between the parties, as set forth in this Agreement, the parties hereby agree as follows: 69/81 2 1. Purchase and Sale. The HRA agrees to sell and convey to the Developer and the Developer agrees to purchase from HRA on the terms herein stated the Properties legally described in Exhibit A attached hereto, and located at 205, 225, and 235 Eva Street in the City of Vergas, Minnesota. 2. Purchase Price and Payment of Purchase Price. The total purchase price (“Purchase Price”) to be paid by Developer to HRA for the Properties is SIX THOUSAND SIX HUNDRED AND 00/100 Dollars ($6,600.00). Developer and HRA agree that the current aggregate 2026 estimated market value of the Properties is $26,400, and that the Developer is receiving a discount in the amount of $19,800 from the HRA for the value of the Properties (the “Discount”). This Discount is a 75% write-off on the value of the Properties and is being provided to the Developer to assist in the financing of the Project. The Purchase Price shall be paid to the HRA on the Closing Date by certified or cashier’s check, or by wire transfer. 3. Deed. The HRA agrees to convey title to the Properties by Quit Claim Deed on the Closing Date. The Developer will comply with any use or sale restrictions that may apply to land acquired through tax forfeiture, if any, and hold the HRA harmless 4. “AS IS”. The Properties are being conveyed “As Is” without any representations or warranties except as expressly stated herein. 5. Closing. The closing on the sale of the Properties shall occur on _________________, or a later date mutually agreed upon by the HRA and the Developer (the “Closing Date”). The Developer shall pay all costs of closing and costs of title insurance, if any. Closing shall take place in any manner or location mutually agreeable to the parties. The HRA agrees to deliver possession of the Properties immediately after closing. All costs and fees related to the sale and conveyance of the Properties, including the costs and fees associated with the preparation of this Agreement, shall be paid by the Developer at closing. 6. Title. Developer shall be responsible for securing its own evidence of title and HRA shall have no obligation to secure title insurance or provide an abstract of title, or to pay for any of the foregoing. 7. Assignment. Neither party may assign its rights under this Agreement without the written consent of the other party. 8. Developer’s Obligations Regarding the Project. (i) The Project shall be completed within two years of the Effective Date. (ii) The Project shall be constructed pursuant to the terms of this Agreement and the Proposal. (iii) The Project shall be sold to an individual or family of low or moderate income (the “End Buyer”), whose annual gross income does not exceed 115% of the Median Family Income for the State of Minnesota as 70/81 2 determined by the U.S. Department of Housing and Urban Development (the “Affordability Restriction”). The Developer shall notify the HRA within three (3) days of the execution of a purchase agreement with the End Buyer, and cooperate with the HRA in providing or facilitating the delivery of evidence for the HRA to verify that the End Buyer satisfies the Affordability Restriction. The HRA shall determine if the Affordability Restriction has been met in its sole discretion. 9. Defaults. Any of the following events shall be an “Event of Default” under this Agreement: (i) Failure by the Developer to pay the Purchase Price and any other costs or fees associated with the sale and conveyance of the Properties on the Closing Date as described in this Agreement; (ii) Failure by the Developer to construct and complete the Project pursuant to this Agreement and the Proposal, and within two years of the Effective Date; (iii) Failure by the Developer to sell the Properties and the Project to an End Buyer that satisfies the Affordability Restriction; or (iv) Failure to perform any other obligation under this Agreement 10. Remedies. Upon the occurrence of an Event of Default, the Developer shall, within thirty (30) days of the occurrence of the Event of Default, pay the HRA an amount equal to the greater of (i) the Discount, or (ii) 75% of the then current estimated market value of the Properties (the “Liquidated Damages”). If Developer fails to pay the Liquidated Damages, HRA shall have all remedies available to it, at law or in equity. 11. Notices. Any notice required or permitted to be given by any party upon the other is delivered in accordance with this Agreement (i) forty-eight (48) hours after it is deposited in the United States mail, certified, return receipt requested; (ii) twenty-four (24) hours after it is deposited with a nationally-recognized overnight courier; (iii) when it is personally delivered; or (iv) when it is sent by facsimile (and such facsimile is confirmed by phone or by activity report). If to Developer: JRMH Holdings LLC ATTN: Josh Hanson PO Box 9 Vergas, MN 56587 If to HRA: Otter Tail County HRA ATTN: Executive Director 500 W Fir Avenue Fergus Falls, Minnesota 56537 71/81 2 with a copy to: Daniel F. Burns Fryberger, Buchanan, Smith & Frederick 700 Lonsdale Building 302 West Superior Street Duluth, Minnesota 55802 12. Captions. The paragraph headings or captions appearing in this Agreement are for convenience only, are not a part of this Agreement, and are not to be considered in interpreting this Agreement. 13. Entire Agreement; Modification. This written Agreement constitutes the complete agreement between the parties and supersedes any prior oral or written agreements between the parties regarding the Properties and the Project. There are no verbal agreements that change this Agreement and no waiver or amendment of any of its terms shall be effective unless in a writing executed by the parties. This Agreement or any amendments may be executed in counterparts, which, taken together, shall constitute one original. The parties agree that this Agreement may be transmitted between them electronically. 14. Binding Effect. This Agreement binds and benefits the parties and their successors and assigns. 15. Choice of Law. This Agreement shall be construed under the laws of the State of Minnesota. 16. Time of Essence. Time is of the essence in all terms herein. [Remainder of page intentionally left blank. Signature page follows.] 72/81 S-1 IN WITNESS WHEREOF, the parties have duly authorized and executed this Agreement as of the Effective Date. HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR OTTER TAIL COUNTY, MINNESOTA _______________________________ Board Chair _______________________________ Executive Director 73/81 S-2 JRMH HOLDINGS LLC Name: Josh Hanson Its: _________________________ Name: _______________________ Its: _________________________ 74/81 Exhibit A Lots 1, 2, 3 Block 3 Sunny Oaks Addition, Otter Tail County, State of Minnesota. PID #s: 82-000-99-0253-000; 82-000-99-0254-000; 82-000-99-0255-000 75/81 EXHIBIT B PROPOSAL [Attached] 76/81 77/81 Ottertail County HRA/CDA 500 Fir Ave Fergus Falls MN. 56537 To whom it may concern: JRMH Holdings would like to purchase lots 205,225 and 235 off of Eva Street in Vergas. These three lots are to be combined to make one buildable and usable lot. We will use fill from a lot that we own off of Diane street and place a 52x28 house along with a 26x26 attached garage on the new lot that currently encompasses Lot 205,225 and 235. The estimated sale price of the home will be 325,000 and we will follow current guideline income threshold limits when marketing the house and ensure the qualified buyer will meet these criteria. We will work with Minnesota Housing to facilitate the final sale. Time frame to begin constructipn will be between fall of 2026 and fall of 2027 or otherwise negotiated. Market Value of the home will be determined by the appraisal value and local market comparisons of like homes. Feel free to reach out if you have additional questions or concerns. We appreciate your consideration when selecting your buyer. Sincerely Josh R.M. Hanson P.O Box 9 Vergas MN. 56587 218-234-1685 . spankysstonehearth@gmaif.com 78/81 Project Plan: Describe the proposed project, scope summary, timeline and address the applicable above items. Application to Acquire Tax-Forfeited Parcel Developer's Name JRMH Holdings Mailing Address: (Street, City, State, Zip) P.O. Box 9 Vergas MN 56587 Cell: 218-234-1685 Work: ____________ _ Email: spankysstonehearth@gmail.com Parcel ID#: 82000990253000, 82000990254000, 82000990255000 Who will be responsible for improvements and maintenance after acquisition of parcel? Name: Josh Hanson Phone: 218-234-1685 Email: spankysstonehearth@gmail.com Please Include: * Building and site plans -New Construction * MF Projects: Proof of funding sources * If proposed project eliminates blight, please explain how the blight will be addressed, include pictures. * If proposed project includes construction of affordable "For Sale" housing, include estimated sale price and how you will ensure that the home is sold to a household that does not exceed 115% state median income. * If proposed project includes creation of affordable rental housing, please include proposed rent amounts. Rent Limits Homeownership 0 BR $1 ,226 Income Limits 5/2025 1 BR $1 ,314 1-2 I $116,900 3 BR $1,822 3+ I $134,435 4 BR $2,033 79/81 t-'rOJeCt t-'ro t-orma (Single Family Rehab of Existing & New Construction) Developer's Name IJRMH Holdings/ Josh Hanson I I Co-Developer: .__ ____________ _,Grey Cells are User Input uses Acquisition Costs: Acquisition: Land Acquisition: Buildings Total Acquisition: Site Improvement & Construction: Demolition Site Improvement Rehabilitation Construction Costs New construction Costs Construction Contingency Total Construction: Soft Costs: Building Permit, License & Fees Architect or Rehab Specialist -Specs/Estimates Engineering Acqu isiton Closing -Legal and Recording Fees Title Search & Title Insurance Survey Appraisal Builder's Risk and/or Casualty Insurance Carrying Costs -Real Estate Taxes Carrying Costs -Utilities Carrying Costs -Grounds Maintenance Carrying Costs -Other Seller Closing Costs Other Other Soft Cost Contingency Total Soft Costs: - I Total Development Cost: Estimated Sale Price (excluding closing costs) ,ver ,-,ro1ecr , ora, :sources Source of Development Funds: Construction Loan or 2nd Mortgage Owner/Investor Equity (Cash) Other Other White Cells are Automatically Calculated Values 6,600 - 6,600 - 15,000 - 303,665 10,000 328,665 1,200 - - 2,000 1,000 - 750 1,500 10,000 2,000 2,000 20,000 23,000 I 63,450 398,715 (3YlJ,715) 405.000 I 80/81 , ora, ueve,opmenr ~ources: uap1cur excess ~ources1: 4U5,UUU ti,:,u15 81/81..... 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