Carver County officials outline plans for $4.29 million in local affordable housing aid

Carver County commissioners on Tuesday heard a proposal from the Community Development Agency to deploy the county's 2025 Local Affordable Housing Aid (LAHA) allocation — a certified $4,285,474 — across down-payment assistance, multifamily gap financing and two purchase-and-rehab projects in New Germany and Chaska.

The proposals were presented by Allison Scribe, executive director of the Carver County Community Development Agency (CDA), and discussed with county Health and Human Services staff, county administrators and several commissioners. The CDA and county have an existing agreement under which 70% of LAHA goes to the CDA and 30% to Health and Human Services.

Why it matters: The certified 2025 LAHA figure is substantially larger than the partial 2024 allocation, and county and CDA officials said the increase would permit a mix of immediate homebuying assistance and targeted capital projects. Commissioners pressed on geography, timing and whether LAHA could be paired with county-owned land or other funds to accelerate larger mixed-use projects such as a combined housing/service facility at First Street in Waconia.

Allison Scribe said the 2024 certified LAHA amount for Carver County (a partial year) was $1,630,000 and that the 2025 certified amount is $4,285,474. “As of today, we have 81.6% or $898,000 of that funding committed. We have closed on 4. We have 5 that will be closing by August 9,” Scribe said of the CDA’s down-payment and closing-cost assistance launched in 2024.

Scribe summarized the CDA’s proposed uses for the 2025 funds: continuing and expanding down-payment/closing-cost assistance; allocating roughly 10% of the new money (about $300,000) for multifamily gap financing to support developers pursuing TIF or Minnesota Housing funds; and purchasing and rehabbing two older rental properties (one in New Germany with five rental units and another in Chaska that includes retail plus two rental units). Scribe said both acquisitions would meet the statute’s definition of a “qualified housing project” — meaning the work would target households with incomes at or below 80% of area or state median income as defined by HUD.

On the Chaska property, Scribe said the CDA would purchase at the listed price and limit LAHA spending to the residential portions; the retail space would be paid for from other sources so LAHA funds are only used for eligible rental units. The combined purchase-and-rehab cost for each property was described as approximately $500,000, and Scribe said those investments would still leave more than $2 million for other programs and initiatives.

County Health and Human Services staff noted planned program rollouts, including a first-generation down-payment assistance program and a senior rehab program, both targeted to launch by the third quarter. Health and Human Services staff reminded the board that 30% of LAHA is administered by that department under the county’s contract with the CDA.

Several commissioners explored using LAHA in concert with county-owned land or other funds for larger mixed-use projects. Commissioner Fahey asked whether LAHA could support a 100-unit housing project on county land that also would house county services now in the First Street Center; county staff and the CDA noted LAHA cannot pay for the portion of any new building used for county offices or other non-housing uses, but said a “cocktail” of funding sources could conceivably be structured so LAHA funds the housing portion and county funds pay for governmental space.

County staff cautioned the board that LAHA funding is legislatively authorized and therefore not guaranteed in future years. Heather (Health and Human Services staff) noted that the funding “got on the chopping block” during recent legislative discussions, and that Carver County will continue to treat annual LAHA receipts conservatively.

What’s next: The CDA said it will proceed with the down-payment assistance pipeline and further explore the two purchase/rehab opportunities. The board did not take a formal vote on allocations during the work session; staff said any projects that require additional approvals would be brought back to the board.

Ending: Commissioners expressed general support for the CDA’s near-term plans and asked staff to continue discussions about whether county-owned land or other existing county funds could help accelerate larger mixed-use development in Waconia or other parts of the county.