Meeker County commits $140,000 in state housing aid to Habitat and Litchfield HRA

The Meeker County Board of Commissioners on April 1 approved committing $140,000 from the county's Statewide Affordable Housing Aid (SAHA) allocation to two local housing projects: a $45,000 0% deferred loan to Habitat for Humanity of West Central Minnesota and a $95,000 grant to the Litchfield Housing and Redevelopment Authority (HRA).

Lisa Grafentine, Meeker County EDA, told commissioners the SAHA program — created by the 2023 state legislature to provide counties and qualifying cities local control over housing dollars — allows a broad range of eligible activities, including acquisition, construction and rehabilitation. “The funds were really a good way ... to be able to allocate funds to housing projects that meet the eligibility criteria,” Grafentine said.

Grafentine described two proposed uses. Habitat for Humanity plans to build five single-family homes in Litchfield over five years, targeting roughly 1,000–1,200 square-foot, three-bedroom homes with estimated sale prices in the $288,000–$320,000 range. The Habitat request is for $45,000 as a 0% deferred loan for a five-year term so the organization can revolve funds to buy lots and construct homes annually.

The Litchfield HRA seeks $95,000 to acquire one parcel for a future multifamily development. Grafentine said the HRA’s total financing need for that parcel and initial soft costs is $135,000, with $115,000 for land acquisition and about $20,000 for legal, survey and other soft costs. The county EDA has committed $20,000 and the city of Litchfield was asked to consider participation at an upcoming city meeting.

Grafentine said the county’s SAHA balance at the time of the meeting was about $151,000. Approving both requests would leave approximately $11,521 in the account; Grafentine added the county is scheduled to receive two SAHA payments in 2025 of $42,198 each, yielding a projected year-end balance of $53,719 after the commitments.

Questions from commissioners focused on project details and eligibility. Commissioners asked how Habitat selects homeowners and whether households can afford the projected mortgage for homes in the price range cited. Grafentine said Habitat has an application and vetting process, requires participant “sweat equity,” and works to ensure mortgage payments are affordable for buyers; she also said 80% of area median income for a four-person household in Meeker County was about $79,000 (2024 data).

Grafentine described program design options: the EDA recommended providing SAHA funds as grants when the EDA is acting as a county entity and as 0% deferred loans for recipients that cannot carry debt service, with a five-year term to allow sponsors time to secure additional financing. She added that SAHA funds retain program restrictions when loaned and would remain SAHA funds if repaid.

Commissioner Schmidt moved to approve the commitments, with a second from Commissioner Psampe; the board voted in favor by voice vote and the motion carried.

The board and EDA also discussed offering the Litchfield HRA technical assistance through the Minnesota Housing Partnership’s Emerging Developer Training Program to help assemble development teams and financing.

The board asked staff to schedule a Habitat presentation at a future work session so commissioners could learn more about Habitat’s selection process and affordability assumptions.

Ending: The board approved the EDA’s recommended funding commitments; staff will follow up with the Litchfield HRA and Habitat for Humanity on next steps and with the city of Litchfield about potential participation.