Park Rapids Economic Development Authority supports revolving loan for housing development (2024)

The Park Rapids City Council, convening as the city’s Economic Development Authority on Tuesday, June 11, recommended council approval of a revolving loan requested by the Heartland Lakes Development Commission (HLDC).

Actual council approval will likely occur at the city council’s June 25 meeting.

Mary Thompson, executive director of the HLDC, explained that they were seeking a $160,000 loan to help buy a 20-acre parcel off Finley Street, east of 20 acres the HLDC already owns.

With a federal grant to build Finley Street and provide infrastructure for a future affordable-housing neighborhood, Thompson said, “It seemed to make more sense … for us to own it all and then do the whole design of it.”

She proposed the HLDC would repay the loan out of proceeds from lot sales in the development, specifically from the new acreage. She projected that the road construction would start in spring 2025, allowing home construction to start that fall and into 2026 throughout the 40-acre neighborhood.

Council members also raised the question of the still-undeveloped park that has been dedicated in connection with the development as well as the Meadow View, Meadow’s Edge and Pine Crest apartments.

Thompson discussed grant writing to fund playground construction.

“The most critical piece of this whole thing is getting a park that’s right-sized,” she said. “There’s going to, likely, be a lot more development. Getting a park that’s more appropriately sized for the potential growth around that area, this is going to assist that. So, we can plan that at the front end … and make sure that it’s able to grow as that neighborhood grows.”

Asked if HLDC has created a plan for the park, Thompson said that if the HLDC achieves its goal to have a child care center at the Pine Crest Apartments, they will need a playground meeting certain requirements to be within 1,500 feet.

“Other than that, that’s really up to the parks board to think about what are the best kind of amenities to put there,” she said.

She suggested locating the park at the south end of the parcel, closest to Finley Street.

Council member Liz Stone suggested including a climbing component and possibly basketball or pickleball courts.

Thompson said the HLDC has considered soccer fields, disc golf and fitness equipment as possibilities. “The parks (board) should think seriously about what kinds of things would really be of benefit to the community as a whole,” she said.

Asked if developers could buy multiple lots, build on spec and sell them, Thompson said that’s part of the HLDC’s plan.

However, she said they want a certain percentage of homes built for the workforce, “folks in that moderate income that are working hard, and it’s hard for them to buy a house right now.”

Thompson said the HLDC would either work with developers to find gap resources to ensure they can hit that target, or have them reserve some lots for that purpose. She explained that there’s a value gap if the cost of construction is more than the appraised value, and an affordability gap if the household can’t quite afford the mortgage.

Thompson estimated that the 40 acres would subdivide into at least 50 to 70 lots. “The HLDC doesn’t want to build those out,” she said. “The quicker that we can get those things to private development, the better that is for everybody. Our hope is that contractors are interested.”

However, she acknowledged that HLDC doesn’t want someone to “buy 20 lots and then just sit on them, and then sell them at a significant profit.”

She said they’ve been discussing a covenant or deed restriction that makes a lot price contingent on building within a certain period of time, etc., to ensure that homes get built and developers don’t take undue benefit from HLDC’s efforts to control costs.

Stone made a motion to recommend that the city council provide the loan. The motion passed 5-0.

During a very brief, regular meeting, the council:

• Heard Public Works Superintendent Scott Burlingame report his staff has been busy all over town surveying for lead water service lines. Later, Burlingame said this survey as mandated by the U.S. Environmental Protection Agency in response to public water supply issues in Flint, Mich.
• Gave full-time Rapids Spirits Liquor Store clerk Joyce Mikesh a wage increase to the 10-year step at $22.13 per hour, and gave part-time Rapids Spirits clerk Colleen Taylor a wage increase to the 48-month step at $20.34 per hour, per the UFCW Local 1189 contract.
• Denied a revolving loan of $40,000 requested by Hammer Fit Gym, as recommended by the EDA.
• Paid Girtz Excavating $1,750 to open, repair and backfill a water line to the pump station on County 15.
• Paid Hildi Inc. $2,600 for a Jan. 1, 2023, actuarial valuation and report for the Park Rapids Firefighters’ Relief Association. According to City Administrator Angel Weasner, this report sets a rate for assumptions of pension liability.
• Paid Legend Technical Services Inc. a total of $3,987 for two invoices regarding asbestos sampling and air monitoring at the Park Rapids Area Library. According to a staff memo in the council’s packet, a survey for asbestos analysis, monitoring and removal was required for the library’s HVAC project to proceed.
• Paid Northwoods Specialties $3,500 to replace the flooring at the public works/public safety building.
• Paid SLL Inc. $25,702 for the second of two invoices regarding 2024 property valuation assessments.
• Received a monthly permit report, showing that in May, building permits valued at a total of $233,059 were issued out of a year-to-date total of over $1.5 million. Fees for plumbing permits issued in May totaled $376 out of a year-to-date total of $766.
• Granted a food truck license to Lenard Riley with Mac N The Box.