Does your property need some TLC? Funds could be available to improve slum, blighted areas of Wadena

Grant funding could be available for homeowners and other property owners in Wadena in an effort to reduce the number of slum and blighted properties identified in a recent survey.

The City of Wadena proposes to provide grant funding to low-to-moderate income (LMI) homeowners in areas of Wadena with the most need. Through a survey of the community by Central Minnesota Housing Partnership (CMHP), the NE section of Wadena was identified as target area A, and the SE part of Wadena was identified as target area B. Combined, these two areas have 64 substandard houses or 39% of the total residential structures; well above the 25% threshold for slum and blight classification.

Additionally, the program would serve to rehabilitate up to 56 units of substandard rental housing city-wide. The improvements to these substandard rental properties are meant to improve the aesthetics of the neighborhoods and maintain affordable quality housing stock for future tenants and residents of Wadena.

The third target area of slum and blight is an approximate 3 block long by 1-1/2 block wide area of the central business district. There are 38 buildings in this target area, 12 of which are substandard or 31%, again well above the 25% threshold for designation.

The city council members held a public hearing regarding the resolution declaring the slum and blighted areas during the same Jan. 14 meeting. The resolution seeks to improve, preserve, and re-develop this slum and blighted area to the benefit of the community.

Speaking during the public hearing meeting was local rental property owner Kyle Davis. Davis spoke positively about how this program can help rental owners make needed improvements that not only improve the looks, but also improve the efficiencies of the building.

“One big struggle with low-income housing is sometimes there is not a lot of money to be made on it and when there are repairs that need to be made, sometimes there is not money at the end of the month after you collect rent and pay expenses to be able to update some of the properties the way you should, the right way,” Davis said. “As a landowner in town, I hope you guys vote for it.”

Another homeowner said she hoped the city could help those in the middle income range that are trying to improve their properties as well. She shared that while she is trying to improve her home, there are expenses she cannot afford. She hoped that many in the neighborhood she lived in would try to make improvements as her side of town “was not always the prettiest.”

“If you can help at all, somebody in the middle range, it would be an amazing program to do,” she said.

After closing the public hearing councilman Wade Miller noted that it was not the council’s decision which areas or what income guidelines to follow. Those standards are set by the Department of Employment and Economic Development’s Small Cities funding program.

“It’s not the city setting the income guidelines,” Miller said. “It’s just something we are applying for, hoping we can clean up the town a little and help those that need it.”

The city council previously authorized Central Minnesota Housing Partnership (CMHP) to submit a pre-application to MN DEED for a Small City Grant to, among other things, address slum and blight in Wadena. The total grant amount applied for is $490,000 for rehab and an additional $82,000, for administrative costs and the $135,000 coming from local funding.

Wadena was one of 33 communities to submit a preliminary proposal for funding and was then asked to submit a full application by Feb. 28. Speaking of the grant opportunity and application was Ed Zimney, program manager of the Central MN Housing Partnership Inc., at a Jan. 14 Wadena City Council meeting. Zimney shared that after submitting an application, awards would be announced in the spring, actual applications from property owners within the city would likely be taken in the fall. A deadline to complete the grant was said to be approximately September 2023.

Council members asked Zimney and Economic Development Director Dean Uselman about the awarded funds and how they can be used. Uselman shared that if all funds are not used in one category, like residential homes, there is a chance those funds could be used in a different category, like a rental property through a grant amendment.

If awarded, the program specifics for Wadena are to provide grant funds to rehab five owner occupied homes in the primary target area; rehab nine single family rentals citywide; 18 units of multi-family rental rehab citywide; and rehab four commercial buildings in a target area with about $30,000 per unit.

To show the city wants to be more competitive in getting funds for these properties staff put together a group of funding sources that could contribute up to $135,000. That amount is about 20% of the total grant. $125,000 of the full amount would be in the form of a 1% loan, according to Uselman. The full amount comes from the following sources: $50,000 from Wadena Development Authority; $5,000 from the city residential fix up fund; $5,000 from the Wadena Housing and Redevelopment Authority; $25,000 from the city residential fix-up funds; $50,000 from the city commercial fix-up funds.

If awarded the grant, the city is also responsible for $8,000 in administrative costs paid to CMHP. The city council approved of those funding sources for this project.

You can find out more about these funding opportunities by attending informational meetings Thursday, Jan. 30, at the Wadena City Hall.

• The first meeting starts at 5 p.m. and will cover information for low to moderate income homeowners who would be interested in having rehabilitation work completed on their homes. If you reside in one of the homeowner target areas you are encouraged to attend this meeting.

• A second meeting starting at 6 p.m. will review rehab information for owners of rental properties. The rental program is for single family and multi-family rental properties located anywhere within the city limits.

• A third meeting will begin at 7 p.m. and will review information for owners of commercial properties which are located in a target area that is part of the downtown district.

“As you can imagine, the applications for these funds are very competitive. Last year only 26 communities received their request for funding,” Zimney said.
One of the ways to increase a community’s chances of receiving funding is to be able to demonstrate owner interest in using the program. A well-attended meeting will improve Wadena’s chances for a successful application. If you are unable to attend the meetings but are interested in learning more, contact Ed Zimny at Central Minnesota Housing Partnership at ed@cmhp.net or at 320-258-0673.