EDA discusses potential housing options in Spring Valley

By: 
Gretchen Mensink Lovejoy

Spring Valley’s Economic Development Authority (EDA) discussed housing options during its April 3 meeting, including continuing learning about the concept of providing a land trust for potential residents to use to build new homes but not have the cost of buying a lot on which to build included in the effort to locate here.

Economic development director Cathy Enerson introduced the idea at a previous meeting, explaining that a land trust offers families who wish to build a home the opportunity to do so without paying the cost of land upfront. They can build a house on land owned by the city, and when the property is sold, the cost of the land is figured into the sale price, recouping the city’s investment.

Spring Valley has been examining its housing inventory in the past year or so, finding that there is a demand for apartments, senior housing options and smaller single-family homes. Enerson observed that the housing needs assessment has been finished and that some communities in the region have used tax abatement to ease costs for residents.

Land for housing is available on the property that the city owns on West Tracy Road that was purchased to serve as the potential site of the state veterans’ home that will someday be located in Preston.

“As a city owning land, you’re in the rare position to reduce the cost of housing by not charging for land,” she said. “A house that’s $300,000 or $250,000, you could deduct $50,000 in land cost from the help they get from getting into a land trust.”

EDA members expressed their interest in the topic, but they questioned how the city would manage the financing. Member Kim Brown shared that the city of Grand Meadow has a land trust that has been used to capacity.

“It’s full…they (homeowners) don’t own the lot, but when the house sells, the land cost is recuperated,” she said.

“If it did sell quickly, we would get the money back quickly. Some people don’t own land, so tax abatement would help them get into property,” Enerson remarked. “The numbers of people who are looking to build outside of Rochester are big due to affordability. We can’t price the land at less (than local contractors or developers). It’s not just a housing trust, but how a land trust could be offsetting for people to own property.”

The EDA members agreed that bringing the idea to the City Council might prove useful, and one suggested that it needs to be proposed to the council in detail because the council is comprised mostly of new members who might be willing to set up a committee to further explore land trusts.

Enerson then spoke about upgrading the EDA website to include links to housing and available assistance resources to help homeowners obtain or maintain their housing.

“The USDA site has links to help people who are disabled get house repairs done, and for people over 62, if they have a roof in need of repair or something,” she said. “We can create some type of housing tab on the city website so that people have more access to the resources around them to preserve their homes and showcasing how others have preserved their homes.”

In other business, the EDA reviewed the business incubator program – for which Enerson had no new applicants but had had interest expressed to her about how to connect building owners to potential business owners. The EDA heard an update from Enerson on the revolving loan fund – with some borrowers making payments on time due to enrollment in automatic funds withdrawals. Another topic Enerson covered was the anniversary of the Rural Entrepreneurship Venture (REV), which is an initiative to assist people who want to start businesses in rural areas but need a hand with financing and direction.

The EDA’s next meeting is on the calendar, set for Wednesday, May 1, at 7 a.m.