BEMIDJI — Fifteen residents of west Nymore gathered at City Hall Thursday night, intrigued by the Headwaters Regional Development Commission’s potential neighborhood housing improvement project.
“Ultimately we want we want to find out what level of interest there is in a housing rehabilitation program that the City Council would like to initiate in the Nymore Neighborhood,” HRDC Community Development Director Tim Flathers said.
A chunk of the Nymore community stretching from First Street Southeast to Roosevelt Road Southeast and from Wood Avenue Southeast to Grant Avenue Northeast was identified as a community that could benefit from a housing improvement project.
“The city has had its eyes on Nymore for a long time,” Flathers said. “If you look at a map of where previous projects have been, there is just this glaring chunk of property south of First Street that has never had this help before.”
With enough interest, the city intends to apply for funding from the Minnesota Department of Employment and Economic Development to provide deferred-payment loans to income-eligible households for qualifying housing projects.
The Small Cities Program offers a zero percent interest deferred-payment loan for a 10-year period. This means that if a loan is given, a mortgage is put on the property and no payments are made on it.
For the first six years nothing is forgiven, meaning if the owner wants to sell the home during this time, he or she is responsible to pay the principal on the loan.
After the six-year period, a portion of the principal is forgiven every month until after 10 years, when the principal is completely forgiven.
“In effect the loan turns into a grant at the end of 10 years,” Flathers said. “It is a really great deal if you have the commitment of staying in your home.”
The types of improvements that the program would allow include necessary improvements like structure safety, energy efficiency improvements and other necessary building structure projects.
“It’s a rehabilitation, not a remodeling program,” HRDC Development Specialist Aaron Chirpch said.
Loans are limited to $25,000, and projects need to be approved though a housing inspection to address the scope of eligible projects in the home. Flathers said the range of projects is not defined and they try to work with homeowners the best they can.
“No one is getting a Jacuzzi, but there are some things that you could make a good case for,” Flathers said. “If we have something that is borderline and we are afraid to say yes but don’t want to say no, we will be your advocate and try to get somebody at the state to say ‘Yeah, go ahead and do it.’”
The loans are federally funded, making it a competitive application process. Flathers said the goal would be to get 40 pre-applications from the area’s residents, a number he feels would be enough for the state to allocate some money to the city.
Flathers said that it is likely that only about half of the pre-applications would get a loan if the money is allocated. The residents would be selected in the order that their applications were turned in.
Of the 15 people in attendance at Thursday’s meeting, about three-fourths raised hands when asked if they would have interest in a loan.
The pre-applications are due by Nov. 15. The state will then decide in December if the community has enough need for an allocation of money. From there, residents would have to complete a full application, due by Feb. 28. If chosen, the city would be advised in the spring on how much money is being allocated.
The loan window would last 30 months, after which Flathers said he would like to reapply for the east half of the Nymore community.