Surveys to help determine housing needs

Kevin Cederstrom The city is taking steps to create more affordable housing opportunities in New York Mills through gap funding, and at the same time look to fill its Country View Addition. The plan is to submit a proposal for fund...

Kevin Cederstrom

The city is taking steps to create more affordable housing opportunities in New York Mills through gap funding, and at the same time look to fill its Country View Addition.

The plan is to submit a proposal for funding through the Minnesota Housing Finance Agency Process.

Along with the city, a number of interested agencies and local businesses are involved in the application process, with the city, Otter Tail-Wadena Community Action, Centennial Realty, and Farmers & Merchants State Bank taking the lead.


The MHFA process is a combined proposal that is distributed to several agencies for funding, including Greater Minnesota Housing Fund, MHFA, State of Minnesota Department of Corrections, and others. One application goes in and all the agencies evaluate them and decide which ones to fund.

Applications are due Feb. 14 and funding decisions will me made by mid-April.

Darla Berry, NY Mills City Clerk, said the city and its application partnership will likely ask for gap funds to help families afford homes that are priced above what they can qualify for. For example, a home is priced at $130,000, and the family qualifies for a $121,000 mortgage. Gap funds of $9,000 could be obtained under this program. Gap financing is capped at $15,000 per home buyer. These funds are only used if the homeowner cannot qualify for the full price. They are not available if the homeowner merely feels the price is more than they can afford, even though they may qualify for the entire amount.

There is also a pool of funding that has a matching component, where the partnership group would list all the incentives that a new home buyer gets if they buy a lot in the city's TIF housing development and build a home within 12 months.

The initial focus is to determine housing needs in New York Mills. Inserted in this week's Herald is a survey developed to determine the need for affordable workforce housing in New York Mills. The surveys have also been distributed to workers through some employers in town.

The city wants to get a grasp of what the current housing situation is and what needs to be done to get people who work here, and travel from neighboring towns, to move to New York Mills.

Lund Boat Company is one area of focus. With employees traveling 40-50 miles to work in Mills, more attractive housing opportunities could get some of those people to move here, which adds to the city's tax base and, theoretically, help create more of an available work force living in town.

"This will help us sell our proposal for funding to those agencies involved," Berry said. "We don't really have enough time to do a full housing study in town, and it has been years since the last one was done. We need a way to show that this town has a need for affordable housing."


The partnership has put together an incentive package for buyers. Some of the incentives include $500 credit towards natural gas bills from the city, $500 off origination fee on a construction loan from F&M State Bank, no sales tax on all materials over $5,000 at Homestead Lumber, one free gallon of milk a week for a year at Dean's Country Market, first year personal tax return free at Larson Accounting, three months of internet service through Lakes Area Internet Plus, $100 QC products free plus $5 off a prescription, one year free membership at the NY Mills Regional Cultural Center, free family membership at the school fitness center, one year subscription at NY Mills Herald, and free mailbox through Farmers Union Insurance. The city has contacted other local businesses and there is room for more in the incentives package. The goal is to reach at least $5,000.

There are six lots in Country View Phase I and 18 lots in Phase II currently available.

Since the city opened Country View, nine new homes and an 18-unit housing complex have been built in the first phase.

The goal is to fill both Phase I and Phase II, which would include at least 52 families in the development.

The city wants to use that as a promoting tool to fill Country View as beneficial to both the city and local businesses, citing the economic benefits of that many new families impacting everything from local contractors to the grocery store to the lumber yard to the bank to the school district.

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