EDA OKs Home Improvement Loan Program | News, Sports, Jobs

NEW ULM – The New Ulm Economic Development Authority (EDA) voted on Tuesday to establish a new rehabilitation loan program for single-family homes.

The loan program is called “The Get It Ready” and provides loans at below-market rates to homeowners who have significant, necessary and costly rehabilitation needs on their home, which can impact the livability and attractiveness of the home when selling .

The program using ACN funds aims to stimulate necessary investments in homes that require additional work to “Prepare it” for the market. Other programs of this variety are available in the region.

City Manager Chris Dalton said building new homes was not possible for new families and first-time homebuyers. He said the loan would help homeowners mend bones in a house.

The program assists homeowners with loans for eligible permanent home improvements and could include: roofing, electricity, heating, structure, driveway repairs, sewer and water pipe replacement, and replacement windows and doors.

Dalton said this loan could also be used for the elderly population who are trying to sell a home but cannot get the price they want because more work is needed.

Dalton said the loan program would need $ 120,000 to get started. The minimum loan amount for the Get It Ready program is $ 5,000. The maximum amount is $ 40,000.

The loans would be at an interest rate of 2% for 10 years.

For applicants aged 65 or over, there would be no monthly payments or accrued interest. The principal amount would be due at the time of the sale. The applicant will be responsible for the $ 60 credit file fee and the $ 50 title search fee.

Requests require a written submission from a contractor (must include materials and labor costs). There is no consideration of equity or material loans only. Payments are made directly to the owner after notifying municipal staff of completed projects.

Homes must be within the city limits of New Ulm and have no judgments or liens registered against the property. Applicants must have at least a third title interest in the property, be up to date on mortgage and property tax payments, and provide proof of current home insurance.

The board questioned whether the loan amounts should be adjusted. Board member Les Schultz said if all loans were up to $ 40,000, AED could only fund three projects.

Dalton said it was a pilot program to determine the need. The program could be adjusted later.

Susan Fix, board member, offered to endorse ACN’s loan program, describing it as a project to beautify New Ulm.

The program was unanimously approved by the board.

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The EDA approved the revised utility allowance scales for the Section 8 Housing Choice Voucher program.

The Section 8 Housing Choice Voucher program provides rent assistance to low-income households. Program participants pay about 30% of their monthly income adjusted for rent and utility charges. The New Ulm Economic Development Authority pays the remaining part of the rent directly to the landlord.

The Utility Allowance Schedule is an estimate of what the household will pay for utilities based on room size, unit type, and location. HUD requires that utility rate schedules be reviewed annually and adjusted based on current rates, climate adjustment factors, and other relevant information that affects the cost of utility services.

Utility allocations have remained fairly stable over 2020 rates. Notable changes have been slight increases in water and sewer rates for Sleepy Eye and Springfield and LPG and fuel oil for all communities.

Schultz asked if the dramatic rise in natural gas prices in February was addressed by this timeline. Schultz was concerned that tenants would still see insanely high bills.

Housing coordinator Heather Bregel said the utility schedule was calculated in December before gas prices climbed. The timeline would likely not reflect the increase until next year. The schedule approved by the council would not come into effect until May 1.

Bregel was uncertain whether the February hike would impact rates next year. Since rates are set in December, the increase in utilities in February may not be a factor.

Council member Daniel Braam asked if this utility allowance could be adjusted later in the year if the council sees a need for it.

Bregel said the board is required to review compensation annually, but nothing prevents the board from making special adjustments.

Braam asked Bregel to bring back the allowance for further consideration if the price of gas had a significant impact on voucher program participants.

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The EDA approved a Broadway Haus site improvement project and allowed staff to solicit bids.

The project involves the replacement of three landscaping block planters and landscaping block edging around a patio. The existing landscaping block planters near the main entrance on the 3rd north side of the building need to be replaced.

In some areas, the bottom row of the block deteriorated from sidewalk salt and several blocks came loose and had to be removed. In other areas, tree roots push against the block causing them to move around, creating large spaces and loose blocks.

The project will include the removal of the existing block and its replacement with poured concrete. Poured concrete planters will be stronger and better able to resist roots pulling them apart over time as there would be no seams / seams.

There is also a patio on the Broadway side of the building with a border made of landscaping blocks. Some blocks broke away over time, resulting in areas where the border collapsed. The edging of the landscaping block will be removed and replaced with a poured concrete edging.

The existing planters and patio edging were built in 2003. Staff consulted with a local supplier in November 2020 about replacing the planters. The seller recommended removing mature locusts and planting new, younger trees. Staff consulted with engineering personnel who inspected the trees and found them to be healthy and did not recommend removing them.

The main reasons for switching to a poured concrete planter. This would save the trees currently in place.

Bregel said the project was valued at $ 10,000. Alternative offers will also be requested to possibly add color and texture to the concrete.

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