In an effort to garner state support for an affordable-housing development, the Duluth City Council will be asked Monday to pre-commit $275,000 to the project dubbed Decker Dwellings.
The future of the proposed 42-unit apartment building hinges on its ability to gain funding from the Minnesota Housing Finance Agency. This will be the second year that One Roof Community Housing, the would-be developer, has sought MHFA backing for the prospective $9.7 million apartment complex. When the project failed to obtain needed support from the agency last year, One Roof placed its building plans on hold.
This time around, city officials aim to up the ante a bit. A statement of purpose on the resolution headed to the Duluth City Council said: "This pre-commitment of city funds is evidence of the city council's support for the project."
If its funding request proves successful, the apartment will be built off Decker Road next door to Schneiderman's Furniture. Decker Dwellings would consist primarily of two-bedroom apartments, with some one- and three-bedroom units included in the mix.
Most all of the building would be rented to households earning 30 to 80 percent of the area median income.
But four units would be reserved as permanent supportive housing for people who previously experienced homelessness.
The city's pledge is contingent upon Duluth receiving anticipated 2020 funding from the U.S. Department of Housing and Urban Development.
Councilors also will consider whether to more fully fund the Tenant-Landlord Connection, an outfit that works to iron out disputes involving rental properties.
City staff had proposed the Tenant-Landlord Connection receive $25,000 in Community Development Block Grant funds, but a committee overseeing the allocations reduced that recommendation to $20,000, explained Ben Van Tassel, a senior city planner.
A resolution to approve those funding recommendations is headed to the Duluth City Council on Monday, but 2nd District Councilor Joel Sipress asked if it would cause any problems if the measure were tabled for a couple weeks to allow for further consideration of other options.
Van Tassel said the requisite paperwork typically isn't due at the U.S. Department of Housing and Urban Development until mid-February, and given the ongoing federal government shutdown, he suggested that timeline may be extended.
Sipress advised fellow councilors that he would work to craft an amendment to the resolution that would provide the Tenant-Landlord Connection with $25,000 in funding. But if an acceptable solution is not in hand Monday, Sipress said he would likely move to table the matter.
The Tenant-Landlord Connection relies on the city of Duluth, St. Louis County and the Duluth Housing and Redevelopment Authority for its funding, and Sipress said One Roof, which runs the program, already had reduced its initial budget request, in light of financial constraints.
"One Roof went back and really went through its budget with a fine-toothed comb. They actually ratcheted that budget down by about $18,000 to what they considered to be just about the minimum that they thought they could ask for without it beginning to do damage to their other programming," he said.
In that trimmed-down budget, One Roof still was anticipating $29,000 in CDBG funding from the city, Sipress said. The proposed $20,000 allocation would leave the Tenant-Landlord Connection about $9,000 shy of that mark.
"My understanding is that they said they probably could find a way to make it work with $4,000 lost - at the $25,000 level - but if it went down that further $5,000, they had concerns about the impact it would have on their other programming, because they'd have to pick up the slack someplace else," Sipress said.