The City of Menahga has $120,763 in grant funds to distribute to homeowners or commercial properties.

In 2018, the city was awarded a $236,700 grant from the Minnesota Department of Employment and Economic Development (DEED) for rehabilitation and infrastructure projects.

Called the Small Cities Development Program, it is part of the Community Development Block Grant Program administered by the U.S. Department of Housing and Urban Development and is funded by Congress. The program helps pay for rehabilitating housing and commercial buildings and updating public infrastructure in small cities and counties.

Ed Zimny, program manager at the Central Minnesota Housing Partnership, told the Menahga City Council about the remaining grant dollars at their Nov. 12 meeting. He oversees the grant projects on behalf of the city.

The city’s preliminary application called for six owner-occupied rehab projects, totaling $117,000, or $19,500 per home.

“Thus far, we’ve had three residential projects completed,” Zimny said. The remaining balance remaining is $65,820. “That would be a minimum of three, and depending on how much each project would use, we could possibly squeeze a fourth in.”

Zimny said, at present, he had no new applications from the “Plan A” target area.

A “Plan B” target area – roughly 2nd Street NE to First Street SE and from Cedar Ave. NE to Fern Ave. NE – was written into the grant. The council agreed to proceed with this second phase.

Three commercial rehab projects, averaging $30,000 each, were included in the city’s preliminary application. “There’s one that’s underway,” Zimny said, noting the business owner is hoping to receive bids this winter and start construction in the spring. A second application was approved, but the owner struggled to find contractors to bid on the project.

There is $54,943 remaining for commercial projects. Eligible activities include addressing structural or building code issues, exterior finishing, roofing, new storefront windows or accessibility, Zimny explained. “It’s rehab, not remodel.”

Council member Karol Andreasen asked what will happen to the funds if they are unused.

Zimny said it will be returned to the state. The grant terminates in Sept. 2021.

To be eligible for Small Cities funding, a project must meet one of three objectives: benefit people of low and moderate incomes, eliminate slum and blighted conditions or eliminate an urgent threat to public health or safety. Projects must be completed within 30 months, depending on size and scope.

“It’s a win-win for the whole community,” he said.

Zimny can be reached at 320-258-0673 or