MOORHEAD – Two big projects providing housing for the homeless, elderly and poor here are getting the financing they need to start construction, officials from the Minnesota Housing Finance Agency and the groups involved said Thursday.
Churches United for the Homeless will get a $7.35 million financing commitment from MHFA to help build a 43-unit apartment complex for the homeless at 315 34th St. N.
The $8.5 million Churches United project, which was opposed by many nearby homeowners when first proposed in 2014, is expected to start construction in the spring, said the agency's interim Executive Director Liz Kuoppala.
Meanwhile, a plan to modernize and renovate the 121-unit Park View Terrace elderly and low-income high rise will get about $11.6 million in loans and tax credits, MHFA Commissioner Mary Tingerthal said.
The Park View Terrace project is likely to start in the spring, said Megan Goodmundson, the regional housing manager for Golden Valley, Minn.-based The Schuett Companies Inc., which owns the building.
The financing package for the Churches United project consists of more than $5 million in infrastructure bonds and the remainder in low-income tax credits. The financing will be treated as a grant as long as the facility meets the state's expectations for supportive housing, which is aimed at providing stable housing for people who are homeless or who drift in and out of homelessness, Kuoppala said.
Kuoppala said the permanent supportive housing project has grown in cost from an original estimate of $6.5 million because of demand in the Fargo-Moorhead construction market and because of design changes, including more green space and more housing units.
Fargo-based Beyond Shelter, a nonprofit focused on affordable housing, will be the developer for the project.
"It won't end homelessness (in Fargo-Moorhead), but it will help significantly," Kuoppala said.
"This is an opportunity for people to land somewhere and rebuild their lives."
The project created a storm of controversy when it was first made public in spring 2014.
The Moorhead City Council initially opposed the project, then reversed itself in two symbolic votes that reflected the deeply divided opinions at the time.
MHFA declined to provide money for the project when Churches United applied last year.
Dara Lee, chairwoman of the Churches United board of directors, said the organization's application was stronger this time around. It had raised almost $360,000 in private donations and gotten a $500,000 grant from the Federal Home Loan Bank of Des Moines for the project.
Park View Terrace at 100 3rd St. N. will also receive a mix of funding for major rehabilitation and renovation.
MHFA is supplying a $3.5 million amortizing loan and $600,000 in a long-term deferred loan, MHFA's Tingerthal said. There will also be tax credits expected to generate $7.5 million in investments from the private sector, she said.
Seven of the 121 units in the building will be set aside to house the long-term homeless, Tingerthal said.
Goodmundson said it has taken two years to get to this point.
"We are very, very excited. We feel very grateful and we look forward to the opportunity to reinvest in that property and modernize it," Goodmundson said.
Park View Terrace will get updates to its major systems, including the elevators, heating, air conditioning and ventilation systems, and a facelift that includes replacing lights, flooring, appliances, cabinets and fixtures. Goodmundson said work on the eight-story building should be "substantially complete" by the end of 2016.
The Churches United project remains a sore point for many people in the middle-class homes of nearby Arbor Park.
Mike Engelking said he recently had one inebriated homeless man pound on his door at 4 a.m., demanding to be allowed in out of the cold.
He said there are three liquor stores in easy walking distance, and he wonders what that will mean if there are no requirements for sobriety for the transitional housing.
"I don't think putting it (the transitional housing) there will help much," Engelking said.
He said he and his wife worry about the value of their property and have debated moving. "We don't want it there."
Engelking said he understands the need for the facility, but the process was too secretive to start.
"I was more upset when they first proposed it. They tried to ram it down our throats," he said. "Will they live up to their promises? I don't know. It remains to be seen."
Meanwhile, Jay Hanson said he was fine with the housing plan.
"It really doesn't affect me," Hanson said. "It's not a drunk tank, so I'm OK with it."
Several people approached Thursday, both for and against the project, declined to go on record for this story.
As one woman said, "I don't think we had a voice" and "now we just have to live with what we have."
Once built, the new Churches United housing "will open up a path for people" who now use the shelter, Kuoppala said.
"The children do better at school and workers do better at work," she said. "Housing is the foundation for making stability possible."
Churches United, at 1901 1st. Ave. N., offers a short-term emergency shelter for 22 individuals and eight families, as well as longer-term transitional shelter and group residential housing for 17 people, with five beds set aside specifically for veterans.
Churches United has been at capacity for years and turns away 30 to 50 families per month due to a lack of space, Kuoppala said.
The shelter can take up to 112 people, she said.
"That's when we put people in the offices and the chapel and packing people in. We're really designed for 86," Kuoppala said.