Council supports housing project
Addressing the housing needs of Mobridge, Diane Weick of SW Design (formerly F&L Development) requested support from the council to pursue another moderate housing project in the city.
SW Design is the company that assisted with building the Third Avenue West four-plex projects in 2004 and 2009. These homes have been fully rented since the building was completed and there is a waiting list of residents interested in renting these homes, according to Weick.
“Over the years I continue to get calls from people asking about building more housing in Mobridge,” she told the council. “The calls seem to be increasing as the housing needs in Mobridge increase.”
She said because the private sector cannot meet the housing needs in Mobridge, building the four-plexes has an additional value to the community. As older citizens want to downsize, yet keep their primary residence in Mobridge, the new construction allows them a single level, attached garage home and puts their larger homes on the market.
Weick explained the four-plex homes meet the needs of moderate-income residents and are not low-income housing.
These projects are built with South Dakota Essential Function bonds, through a local housing authority. The Housing and Redevelopment Commission (HRC) is the eligible entity in this area. The financing bonds are revenue bonds and the rental revenues pay the building debt. No city revenue used for construction. The total cost of the project is 100 percent financed.
The builders will make use of local contractors and local suppliers in the construction of the new homes.
Weick explained the South Dakota State Statute provides that the Housing Authority may or may not establish a “payment in lieu of taxes” on the property, which is typically 0 to 5 percent of the rent revenue. HRC may also elect not to pay any such taxes on the property.
She said that once the principal of the project is paid down, normally about 10 to 12 years after construction, the projects are sold into the private sector, bringing the sites back onto the tax roles.
“This is really a win, win situation for Mobridge and meets one of the housing needs of the community,” Weick said.
She requested the council’s support in exploring a new project for the city.
“Obviously a four-plex does not meet all of our housing needs, but it helps,” said Mayor Jamie Dietterle. “The homes are good for the older residents who want to scale down, but stay here.”
Weick said the project homes were senior friendly, but not senior exclusive. She said there is some room on the current site to build additional homes but there are also other lots in the community that are being considered.
The council approved Weick’s request to pursue getting more information about a new project to the council for consideration.
Terry Helms of Helms and Associates in Aberdeen addressed the council about construction of a revenue-producing hangar at Mobridge Regional Airport and land acquisition for the runway protection zones off of all runways at the airport. He said the property acquisition is approximately 15 acres around the airport.
Helms said the hangar, which would cost about $504,000 to construct, fills the need of the state firefighting crews that have spent recent summers based in Mobridge in order to be near the grassland fire danger.
He said upon authorization of the federal government, which he expects within 60 days, the hangar project can move forward. The city’s share of the project would be 5 percent, the state’s share is 5 percent and the federal government would should 90 percent of the project cost. That project is expected to be completed by the spring of 2014.
The acquisition project has been approved by the Federal Aviation Administration and has been on the table for a number of years. The funding for the acquisition comes from the city’s $150,000 yearly entitlements for the airport each year. There is $234,000 in that entitlement fund now and the 2014 and 2015 entitlements would be used in negotiation, surveying and acquiring the land.
Mobridge City Attorney Rick Cain asked if federal funds were delayed, would the city be responsible for paying any remaining costs not covered by the government. Helms told the council if there is a delay, the city could borrow the money to cover the costs until the federal funding was approved.
The council approved a contract with Helms to continue the land acquisition project and to build the revenue-producing hangar.
Mobridge Water Department Manager Brad Milliken requested permission to continue the water and sewer main projects alone Second Avenue West to 14th Street to get rid of dead ends in the system and improve service to homes in the neighborhood.
The project includes extending the water main from Second Avenue West east to First Avenue West where a T joint will be installed to tie into a dead end. That will complete a loop in that section. That main will be extended to Main Street from the T joint and a valve would be installed.
This will bring better volume and better water quality to the neighborhood.
The sewer main would be extended from the manhole on Second Avenue West to the intersection of First Avenue West.
The street will be graveled for a couple of months according to Milliken, until the projects can be completed.
There has been $90,000 budgeted for the project, but will not cover both the water and sewer costs.
Ward 1 Councilman Tom O’Connell requested the water department complete the water main project, get an estimate for the sewer main project and the council will revisit that portion of the project when the cost estimate is complete.
– Katie Zerr –