Support the Timberjay by making a donation.

Serving Northern St. Louis County, Minnesota

Ely’s HRA commits cold cash for new housing

Catie Clark
Posted 4/10/24

ELY- Talk is cheap. Ely’s Housing and Redevelopment Authority (HRA) went from talk to commitment on Tuesday when it moved $350,000 from its levy account to the city’s housing trust fund. …

This item is available in full to subscribers.

Please log in to continue

Log in

Ely’s HRA commits cold cash for new housing

Posted

ELY- Talk is cheap. Ely’s Housing and Redevelopment Authority (HRA) went from talk to commitment on Tuesday when it moved $350,000 from its levy account to the city’s housing trust fund. Taking the plunge on a new housing project was disguised as a mundane agenda item at the HRA’s Tuesday meeting. For the first time, HRA opened up its wallet and ponied up its own funds to the proposed 37-apartment workforce housing project on the site of the old city garage on W. Pattison St.
The importance of this simple act was underscored last week when the Ely City Council designated Tuesday’s HRA meeting to be a special city council meeting. The special meeting status was required under Minnesota law if any city council members other than the HRA liaison wished to attend. City council member Paul Kess and Mayor Heidi Omerza were at the HRA meeting in addition to Angela Campbell, the city council liaison and HRA chair. Anticipating HRA’s commitment, the city council created the housing trust fund on Feb. 20.
Competing for money
The $350,000 is four percent of the $8.4 million price tag on the project. Ely has moved aggressively over the last year to tap state funds allocated for workforce housing. “There is an unprecedented $39 million in housing funds right now from Minnesota,” Ely’s Clerk-Treasurer Harold Langowski told the HRA at its meeting. “The state made that money available during last year’s Legislature to address the need for workforce housing. Usually, they only allocate around $3 million.”
Working with developer D. W. Jones of Walker, Minn., the project will add 37 workforce apartments in a range of sizes to the city’s housing stock, with rents ranging from around $750/month for one-bedroom apartments up to $1,350/month for three-bedroom units.
Ely is in the final lap of competing for funds from that $39 million pot of state money. “Getting grants from the state housing funds is a competitive process,” Langowski explained.
“No other (local government) competes as well as Ely does,” added John Fedo, Ely’s economic development consultant. “Ely is currently well placed to compete.” The city is after a $4 million grant from the state. The final application for the housing grant is due at the end of this month.
Assembling the pieces
The city took several steps to gain a competitive standing, starting with tossing its old housing study, which it updated last summer, hiring Maxfield Research for $8,200.
Since then, the city has aggressively pursued multiple sources of money for the project, assembled a funding package, and found a developer willing to work in rural Minnesota.
The funding package includes the HRA’s levy funds now in the housing trust, an $850,000 housing grant from the Iron Range Resources and Rehabilitation Board, the donation of labor and land from the city, and a projected $270,000 sales tax exemption currently on the Legislature’s floor. The rest of the funds will be financed using St. Louis County’s bonding capacity.
The next hurdle for building the new apartments is winning the $4 million grant from the state.