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Mountain Lake council approves re-subordination of SCDP loan, contingent on DEED review
Summary
The Mountain Lake City Council approved re-subordination of a Small Cities Development Program (SCDP) deferred loan tied to SCDP File O-3, allowing a homeowner to refinance and eliminate a HELOC; approval is contingent on final written exception from DEED.
Mayor Mike Nelson called the Mountain Lake City Council to order at 5:45 p.m. on March 2. During the meeting the council approved a request to re-subordinate the city’s Small Cities Development Program deferred loan connected to SCDP File O-3.
Councilmember Andrew Ysker moved to approve the re-subordination and Councilmember Jeff Jack seconded. The motion carried, 4–0.
According to the materials reviewed by the council, the property’s SCDP deferred loan balance is $24,846 and the property has an appraised value of $100,000. Council members recorded that the proposed refinance would consolidate debt, eliminate an existing home equity line of credit and simplify the property’s overall debt structure while keeping the city’s SCDP loan secured against the property.
The council’s approval is explicitly contingent on the Minnesota DEED’s determination and final written approval of an exception and on compliance with all applicable SCDP requirements; council materials note the SCDP file was closed on Dec. 3, 2025. The council did not specify a timeline for DEED review or any additional conditions beyond final DEED approval.
Next steps: the action will not be effective until DEED issues its written approval of the requested exception and city staff confirm compliance with SCDP rules.
