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Committee hears Broadway Villas housing plan, council discusses BDPI match and rail spur planning for industrial park
Summary
Housing authority staff presented a proposal for 12 owner‑occupied units (Broadway Villas) with about $978,382 in initial funding; council and committee discussed affordability, tax‑increment options and incentives. Separately, staff and Houston Engineering outlined an industrial‑park rail spur extension tied to an EDA award and a possible BDPI state grant match.
Housing and Economic Development Authority staff updated council and committee members on two development tracks: a proposed owner‑occupied housing project south of the Casey's site (Broadway Villas) and industrial‑park infrastructure that would extend rail service into the park.
Taylor, representing the housing authority, said the project would develop roughly six twin‑home buildings (12 units total) on a 3.5‑acre site and that the authority had secured about $978,381.72 in funding from various programs, including a Tier 2 Cities award and local funds. "We're looking to develop about six twin homes on that property...12 units of housing, all of which would be owner occupied," Taylor said. Staff said homes would be marketed to households at or below a stated percentage of state median income; councilors raised a packet inconsistency (115% vs. 150% of state median) and urged staff to clarify eligibility and finalize proformas before seeking formal approvals.
Council members questioned likely sale prices (an early estimate near $400,000), whether single‑earner households could afford those prices, and whether tax increment financing or additional funding would be needed to lower buyer costs. Staff said the Greater Minnesota Housing Fund and other partners are assisting with design, proformas and potential pre‑sale strategies.
On the industrial park, Trent Burke (Houston Engineering) and EDA representative Phil described a proposed phase‑two rail spur extension from Minnesota Northern to bring track to the Farmers Union property and provide freight yard opportunities. Staff said the application window for EDA and related state grants is tight (mid‑January) and that the city would ask for a land lease for the rail corridor (proposed near $3–$4 per linear foot), with the rail operator or grant applicant responsible for construction costs. Council discussed staging, potential warehousing and the need for associated infrastructure (roads, storm ponds) to address known drainage and gas‑line constraints on some parcels.
Separately, earlier in the meeting the council approved a resolution authorizing application for a Business Development Public Infrastructure (BDPI) grant to the Minnesota Department of Employment and Economic Development (DEED) seeking up to $2 million to match federal EDA funding for the industrial park expansion. Council also directed staff to compile a lot inventory and develop updated housing incentives (e.g., water/sewer hookup credits, short free garbage credits, waiver of some fees) to encourage new construction and address local workforce housing needs.
Next steps: staff will clarify income eligibility numbers for Broadway Villas, complete proformas and bid estimates, pursue the BDPI application for up to $2 million as a federal match, and prepare the EDA rail‑spur grant materials with proposed lease terms. Council asked staff to return with a map of available lots and potential incentive packages for future meetings.
