New affordable housing model takes shape in Minot
By JILL SCHRAMM
A new model for affordable housing could soon be helping folks in Minot.
A nonprofit group and the City of Minot are both looking at a concept known as a Community Land Trust as a means of creating lower-cost homes for renters and buyers while rehabilitating areas affected by the 2011 flood.
The nonprofit group, Plum Valley Developers, is organized and is seeking land for development. Plum Valley is the translation of the Arikara name for the Souris River Valley.
Kari Conrad, president of Plum Valley Development, said the group is applying for a grant to pay attorney, architect and engineering costs and hire a staff person to serve during the development phase.
Conrad said the group plans to contract with a developer to construct apartments or townhouses, with the goal of establishing 500 units of new rental housing. Building multi-family housing maximizes the money invested because the cost per rental unit is less than half that of a house, she said.
“We can help more families,” Conrad said.
Under a Community Land Trust, the nonprofit owns the land but does not own or operate the housing. Plum Valley Developers would contract with the owner of the rental buildings to ensure that the property is managed as affordable housing. Plum Valley Developers would receive some lease income from the building owner to pay the cost of a trust manager and any payment in lieu of taxes.
Trust land is not taxable. However, Plum Valley Developers is interested in arranging for a payment in lieu of tax with the city. Grand Forks, the only North Dakota city with a Community Land Trust, receives a payment in lieu of taxes on property in the trust.
Because the building developer does not invest in the land, the builder doesn’t have that cost to incorporate into the amount charged for rent, Conrad said. For two people with an income of between $25,000 and $58,000, rents could be between about $600 to $1,400 to fall within the affordability range of 30 percent of income. For a family of four earning $31,200 to $77,000, rents could be $800 to $1,900.
The City of Minot also is setting up the Minot Area Community Land Trust to provide affordable single-family homes. People who buy the houses have the same permanence and security as a conventional buyer, but the purchase cost is less because they are not buying the land.
Mayor Curt Zimbelman has appointed an initial committee to create the bylaws and organizational structure that will govern the land trust once a nonprofit committee is formed.
Organizers of the two land trust groups have communicated but are working separately at this time.
Jason Zimmerman, Minot’s flood recovery coordinator, said the city has $2 million from a state Rebuild and Retain grant that it wants to put toward the project. The idea to create a Community Land Trust came from a housing recovery committee formed following the 2011 flood. Zimmerman said other recovery issues have pushed the concept to the back burner for a time, but interest in the idea remains strong.
The city hasn’t yet identified land to put into a trust. Zimmerman said the intent is to focus on property in the valley and create housing that is affordable for buyers such as teachers, police officers or fire fighters who are getting started in their careers.
Plum Valley Developers has been contacting owners of abandoned properties and banks regarding lots that aren’t in foreclosure but are considered nonperforming. Conrad said the group is seeking donated land, and there is opportunity for banks to participate in exchange for Community Reinvestment Act credits.
The group also seeks property in recovery from the 2011 flood.
“We want to rebuild the valley,” Conrad said. “It’s been a tremendous source of low- and moderate-income housing in Minot. It’s convenient. The infrastructure is there.”
Plum Valley Developers’ board consists of equal numbers of representatives of the low- to moderate-income population, the general public and agencies or industries that are involved in housing. The last category is represented on the board by a banker, Realtor, mental health professional and work-force developer.
In addition to Conrad, board members are vice president Clyde Thorne, secretary Deb Kunkel and treasurer Sherry Wagner. The board also has a project advisory committee of construction experts who will assist in reviewing projects.
The city’s initial advisory committee includes city council member Amy Moen; Minot Housing Authority director Tom Pearson; Connie Feist, who chaired the housing recovery committee; and Mark Lyman of Odney, who served as public information officer for flood recovery for the city.
The Community Land Trust concept was created more than 30 years ago by the Institute for Community Economics in response to the rising costs of housing, limited space for new construction, growing number of abandoned buildings and an aging housing stock in eastern U.S. cities. There are now about 200 communities across the U.S. that currently operate or are forming Community Land Trusts, according to the National Community Land Trust Network.