HRA, Housing Coalition succeed in levy request

Hubbard County commissioners have unanimously approved a special $200,000 levy for the Hubbard County Housing and Redevelopment Authority (HRA). The levy qualifies the HRA to receive a matching grant from the Greater Minnesota Housing Fund (GMHF)...

Hubbard County commissioners have unanimously approved a special $200,000 levy for the Hubbard County Housing and Redevelopment Authority (HRA).

The levy qualifies the HRA to receive a matching grant from the Greater Minnesota Housing Fund (GMHF).

At the request of the county board, HRA representatives and other members of the Hubbard County Housing Coalition Thursday presented a detailed plan on how the money would be spent.

The two-year HRA plan as presented would rehabilitate 30 houses and help finance 10 more, with more possible projects depending on additional leveraged funding.

Additionally, the HRA would give down payment assistance to four households after applicants complete one of four Homestretch education classes the HRA will provide.


The plan also calls for the completion of a county housing study to determine detailed needs in both municipal and rural areas.

According to the plan, the HRA will use the grant money from the GMHF to implement a revolving low-interest loan fund for housing rehabilitation.

The HRA will make 20 revolving loans to applicants in 2008-09. The loans of approximately $20,000 will incur interest at a 3 percent rate to keep pace with infloation.

Hubbard County households earning between 50 percent and 80 percent of the county median income, estimated at $39,000, will be eligible for the loan.

The plan set a deadline to begin making the loans in the spring after the HRA sets specific criteria.

The agency also plans to apply for a housing rehabilitation grant from the state Department of Employment and Economic Development (DEED) Small Cities Development Program.

If the application is accepted by DEED, the HRA can loan to up to 20 more households from the $350,000 requested, less administrative costs.

In either case, money from local levy dollars will provide for 10 more low interest loans, averaging $10,000, beginning in 2009.


Levy dollars will be used to purchase and rehabilitate one house each year for resale to a household earning less than 80 percent of county median income.

The HRA will work with municipalities to obtain permission for the location prior to the purchase, and will use local resources to rehabilitate the home.

Most of the cost, estimated at between $80,000 and $100,000 per year, will come from the HRA's existing revolving account. About $20,000 of levy money will be added to the program over two years.

The HRA plan details its assistance in the construction of five affordable homes per year.

Moderate income households can apply for a $15,000 no-interest loan to be repaid over the same period as a mortgage. Private and non-profit partners will be responsible for constructing the homes, at an estimated value of $145,000 each.

For two first-time homeowners per year, the HRA will grant a downpayment loan of up to $10,000. The loans will be paid back over five years at a 3 percent interest rate.

If the HRA leverages additional funds from local employers and the GMHF's Employer Assisted Housing Program, more households may be eligible.

Homestretch homeowner education classes will continue, with at least two sessions per year. Prospective homeowners will need to attend the classes before receiving financial assistance from the HRA.


The plan presented to county commissioners detailed participation in the 12-member Hubbard County Housing Coalition. As part of the housing coalition, the HRA will complete a county-wide housing study and plan.

According to the report, the study will analyze county housing needs to identify problem areas and recommend detailed strategies for both municipal and rural areas.

The HRA will contribute $10,000 of the $42,500 needed for the study, beginning with a planning phase in the spring.

A 2003 Park Rapids housing study indicated about 900 households are burdened by the cost of housing, defined as paying more than 30 percent of their income for housing costs.

The study further noted a need to rehabilitate about 350 homes in the city, and estimated about 2,000 substandard housing units in the county.

Several county commissioners indicated their approval of the HRA plan.

"It looks like you've done a terrific job on this," said commissioner Dick Devine.

Devine asked if the plan would cover all parts of the county.


HRA executive director Michelle Mahowald said most of the HRA's work on rehabilitation takes place in rural areas around the county.

"My mind hasn't changed. I support the program," said commissioner Don Carlson.

"You've done what we asked you to do," agreed commissioner Greg Larson. Larson, said he did not receive any negative comments about the HRA levy.

Carlson then made a motion, seconded by Larson, to set the HRA special taxation district levy at $200,000 for 2008 and 2009.

Commissioner Lyle Robinson questioned the legality of setting a levy for multiple years. He suggested setting the levy for each year.

Carlson amended his motion and it passed without further discussion.

"We will do everything we can to make you proud of your decision," said HRA board member and former county commissioner Ray Melander.

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