A major highlight of the meeting was the approval of a development project at 6501 and Penn Avenue South, involving the sale of land for $1 to Penn Station Apartments LLP. This decision followed debate over the financial implications and community impact of the project. Assistant Director Julie Urban explained the rationale behind the reduced land price, citing complications with tax increment financing (TIF) districts. The sale at a nominal price aims to avoid administrative challenges, as any proceeds would revert to the TIF districts.

The development promises a mix of unit sizes and affordability levels, ensuring that 16 units will be affordable at 30% of the area median income, 18 at 50%, and eight at 60%. Additionally, 13 units will offer rental assistance and supportive services through Simpson Housing Services, focusing on individuals with disabilities and formerly homeless households. Urban emphasized the project’s potential to revitalize a blighted area and maintain affordability for four decades. The city council had previously granted land use approvals necessary for this project.

Despite the approval, the project sparked discussions about its alignment with community aspirations for Penn Avenue. Some board members voiced concerns about the 100% residential nature of the development, highlighting residents’ desires for a mixed-use project that could include commercial spaces. However, others supported the project, citing its contribution to addressing affordable housing needs and the site’s limitations, which include sloped terrain and awkward access.

A board member reflected on the site’s location in the heart of the commercial district. Another participant acknowledged these challenges but stressed the importance of fulfilling affordable housing requirements and the site’s constraints making commercial use difficult.

In addition to the affordable housing development, the meeting addressed changes to the Deferred Loan Program. The program, which provides no-interest deferred loans to homeowners earning less than 80% of the area median income, underwent modifications to align with neighboring cities and ease administrative burdens. The executive director proposed reducing the loan repayment period from 30 years to 15 years and forgiving loans already exceeding 15 years. This change, aimed at fairness and consistency, was met with agreement among board members and was unanimously adopted.

The meeting also included a report on successful funding requests, with the executive director announcing a $150,000 trust fund match from Minnesota Housing and a $33,000 award for the Penn Station project from the Met Council. These funds will support ongoing and future affordable housing initiatives.