Blighted properties targeted
The Duluth Economic Development Authority took aim at blighted property Monday night. Commissioners unanimously agreed to provide up to $400,000 to buy and tear down condemned or nonconforming structures in Duluth. The money will be used by the H...
The Duluth Economic Development Authority took aim at blighted property Monday night. Commissioners unanimously agreed to provide up to $400,000 to buy and tear down condemned or nonconforming structures in Duluth. The money will be used by the Housing Redevelopment Authority to acquire and demolish problem structures in five neighborhoods: East Hillside, Central Hillside, Lincoln Park/West End, West Duluth and Morgan Park.
About 120 properties have been identified as candidates for demolition, according to Keith Hamre, manager of the city of Duluth's Community Development and Housing Department. He said the city will consult with community clubs and neighborhood districts on where best to focus its efforts to improve the overall appearance of the area.
"That's our primary goal: to increase the curb appeal of the neighborhood," Hamre said.
On average, the HRA spends about $28,000 to acquire and clean up a site. The funding should enable the authority to tackle 10 to 15 demolition projects initially.
Hamre said the city won't force any property sales. Instead, participation will be entirely on a voluntary basis.
After a structure is removed from a site, the property will be made available to others for development. Hamre explained that proceeds from the sale of property for redevelopment will be pumped back into the fund.
"We hope to make these sites attractive to developers," he said.
bonds for st. luke's?
In other business, DEDA gave preliminary approval to a plan Monday night that could provide St. Luke's hospital with up to $16 million in tax-exempt bond financing. The hospital would use the money to purchase surgical, cardiology and radiology equipment.
The bonding money probably would be sufficient to cover about 1½ years of capital improvements at the hospital, said John Strange, St. Luke's president and CEO.
If the bonds are approved, St. Luke's will bear sole responsibility for paying them off in five years.
Tom Cotruvo, DEDA's executive director, said such bond financing also has been used in the past to help other nonprofit facilities grow. He pointed to bonds issued on behalf of SMDC Health System, Lakeshore Lutheran Home and Northwood Children's Services as examples.
The bonds probably could provide St. Luke's with financing at a rate of 5.3 percent, according to James Wuellner, the hospital's chief financial officer.
He said that's about 2 percentage points better than the hospital could get via conventional bank financing.
PETER PASSI covers business and development. He can be reached weekdays at 279-5526 or by e-mail at ppassi@duluth news.com.