Hubbard County Economic Development and Housing Redevelopment Authority (EDA-HRA) will apply to become an administrator of Minnesota’s Rehabilitation Loan Program (RLP) and the Emergency Loan Program (ELP).
Calling owner-occupied rehabilitation “a hot topic,” Heartland Lakes Development Commission (HLDC) Executive Director Mary Thompson said, “You may have heard many people saying it’s impossible for us to build our way out of the housing crisis. In conjunction with that, we need to support the units that are already here.”
In her October report to the EDA-HRA, Thompson wrote, “With the housing shortage in the county, it’s important to keep our existing housing stock in good condition. However, not all households have the financial resources to make the necessary repairs. The county has long expressed interest in expanding this service.”
There are limited sources of funding available to assist low-income households, but Thompson noted the Minnesota Housing Finance Agency has two companion programs: RLP and ELP.
RLP provides loans to improve general safety, livability and energy efficiency as well as replacement of manufactured homes.
ELP provides loans to address emergency situations, such as system failures, structural failures and accessibility needs.
Currently, Thompson said, there is only one administrator who serves most of northern Minnesota. It’s the Headwaters Regional Development Commission (HRDC) in Bemidji.
“We would serve Hubbard County, which would allow easier access for individuals that may be interested in doing some home improvements,” she said. “We could also then explore other ways of layering resources to have a greater impact on owner-occupied (housing). This is a tool that we have the potential to use outside resources to get our owner-occupied programs up and running.”
She wrote, “The program could also be used in conjunction with local funding and potential future funding, such as Small Cities Development Grants.”
Thompson noted HRA was a previous administrator for the program and provided a mechanism to work in all parts of the county.
There is a bit of risk, she said.
“Minnesota Housing does provide administrative funding for the program; however, those funds must be used for marketing, applicant processing, inspections and follow-up and are based on closed projects,” Thompson wrote. “It is not clear if the funding will adequately cover the costs to administer the program. Also, if the project does not close, all costs incurred are not covered by the program and would need to be covered by local EDA-HRA resources. If local funding for administration is required, it will leverage resources in the community that would otherwise not necessarily be available.”
Homes built prior to 1970 must be inspected for lead. The special machine used to test for lead is estimated to cost between $15,000 and $20,000. Thompson noted HLDC has funding through the U.S. Department of Agriculture to expand owner-occupied rehabilitation in Hubbard County and could potentially use those dollars to cover a portion of the machine’s cost.
The other option, she said, is to contract with HRDC, who has the machine.
“You can still do the programs without that machine,” Thompson said.
HLDC does not have in-house inspectors, but Thompson said those services could be contracted. That cost would be part of the administrative funding needs.
The EDA-HRA Board unanimously agreed to apply to become an administrator.
“Great! I’m so excited,” Thompson said.
