The primary focus of the meeting was a public hearing on the purchase and development of four properties on Humboldt Avenue, known historically as the Ralph Flats. These lots were previously acquired with right-of-way acquisition loan funds and held by the city for potential expansion of Interstate 35W. After analysis, the city decided the unused lots, vacant for nearly two decades, could better serve the community if developed. Transferred to the Housing and Redevelopment Authority (HRA) in 2023, the goal was to expand affordable homeownership in Bloomington.

The HRA purchased the four lots for approximately $440,000 and entered a partnership with Twin Cities Habitat for Humanity to construct three single-family homes and one duplex. These homes, intended for owner occupancy, aim to serve households earning up to 80% of the area median income, with potential for deeper affordability based on Habitat’s clientele. The lots will be sold to Habitat for Humanity for a nominal fee of one dollar, with development expected to occur in phases. Habitat plans to initiate construction on two lots in 2026, with the remaining lots developed in subsequent phases, pending a lot line adjustment.

The total development cost is projected to be around $2.5 million, funded through multiple sources: $300,000 from the HRA’s impact fund, $300,000 from the Metropolitan Council’s Local Housing Incentive Account, and additional resources from Habitat to cover a remaining gap estimated at $500,000. Construction on the initial two homes is anticipated to start in the first quarter of 2026, aiming for completion by the end of the year, while subsequent phases will follow in 2027.

During the meeting, Noah Keller, a Real Estate Development Manager with Twin Cities Habitat for Humanity, outlined the organization’s recent projects and the anticipated completion of homes in their Park Avenue initiative. Keller emphasized that the new homes in the Humboldt development would feature energy-efficient elements, including solar panels and adherence to zero-energy-ready standards, alongside meeting indoor air quality and green community requirements. The homes would include a 30-year affordability declaration.

Discussion among board members included questions about the solar panels. It was clarified that Habitat would purchase the panels, applying rebates to offset costs, with maintenance responsibilities falling to the homeowners. Homeowners would also benefit from energy credits from the panels fed back to the grid. There was also inquiry into the financial commitment to the project, confirming that the HRA had already invested approximately $440,000 in property acquisition.

The meeting also covered communication strategies with local neighbors concerning the project’s impact. One commissioner mentioned engaging with a property owner to ensure community involvement and awareness. It was acknowledged that some neighbors viewed the empty lot as open space, and development could shift perceptions. Habitat for Humanity was commended for facilitating communication during construction, offering a platform for residents to express concerns.

A commissioner expressed support for the project but sought details on whether alternative housing ideas had been explored. It was clarified that Habitat for Humanity functioned as both developer and lender, using the Park Avenue project as a prototype to evaluate outcomes, particularly sales speed and family types served. While future explorations of different approaches were of interest, the current project would not incorporate these alternatives.

The board also discussed the impact of deed restrictions on assessed home values and property taxes. A commissioner inquired if deed restrictions would lower assessed values, affecting taxes. It was confirmed that deed restrictions for affordability do not affect assessed or appraised values; hence, homeowners would pay taxes based on the full assessed value. A state-level legislation, referred to as “four D,” was mentioned, which aims to offer tax benefits for affordable homes but has not been enacted.

The benefits of using a long-term deed versus a land trust model were explored. The board emphasized that their model has been in place for about 40 years, with the decision to utilize deed restrictions made for clarity for homeowners and stakeholders. A commissioner stressed the importance of public communication, noting that the current approach is consistent with historical practices.

Following the discussion on the Humboldt Lots, the meeting transitioned to the Program Year 2020 Consolidated Annual Performance and Evaluation Report, linked to the Community Development Block Grant from the Department of Housing and Urban Development. The report evaluates the execution of the previous five-year plan and annual action plan. Despite numerous community needs identified, limited funding resulted in zeros in a significant table. The total budget was approximately $1.4 million, with $1.1 million expended, leaving a balance for carryover. The cyclical nature of program income, related to housing market conditions and rehabilitation loans, posed a challenge in timely fund utilization. The report also highlighted funding for senior services, aiding around 140 individuals with maintenance to help them age in place.