Citywide Housing Initiative
As in most Iowa communities, offering appropriate housing choices for all residents is a challenge in Stanton. There are no apartments with modern amenities nor are there any high end apartments. There is a need for duplexes and fourplexes, and the existing single family housing stock is mostly older; about half of the homes in Stanton were built in 1939 or before.
Residents recognize the importance of offering the appropriate choices for all ages. With an aging population, Stanton needs more ranch-style homes. The community needs to look at a program to encourage millennials to buy homes along with opportunities to live in second story apartment units on Broad Avenue.
The community already has benefitted from the work of the Stanton Area Industrial Foundation, which, “through speculative housing, lot development, and business and industry promotion, encourages newcomers to join in the spirit of positive growth” in Stanton. Now is the time to expand on the Industrial Foundation’s work to take an even broader approach to addressing the community’s housing challenges.
Stanton must take a comprehensive approach to the housing issue. The housing shortage is not going away unless the community’s businesses do. Stanton’s housing shortage is compounded by its status as a bedroom community to Omaha; more people who work in Omaha are moving to Stanton as they look for a charming small town where they can raise their families. There are multiple tools to address this shortage as well as enhance the condition of existing housing stock.
A citywide funding pool could be created using bonds or Tax Increment Financing (TIF) revenues. The creation of this fund would be contingent upon the private sector matching it fifty percent. The funding pool, positioned as a revolving loan fund, would offer both traditional, low interest loans and forgivable loans, helping draw developers to the area. The funding pool should be made up of both public and private dollars.
Using an example from neighboring Nebraska, the state has appropriated $7 million to help bridge the gap for developers to be used as a revolving loan fund. The State of Iowa is interested in a similar program through the Iowa Finance Authority (IFA).
Funding for all programs could be used to create new units and to rehabilitate existing units.
Nebraska’s Rural Workforce Housing Fund provides matching grants to nonprofit development organizations to reduce the cost of workforce housing in rural Nebraska communities; towns that are less than 100,000 people are eligible. The grants support a variety of housing projects:
- New owner-occupied housing costing no more than $275,000.
- New rental housing units costing no more than $200,000.
- Owner-occupied or rental housing units for which the cost to substantially rehabilitate exceeds 50 percent of a unit’s assessed value.
- Upper-story housing.
- In all cases, housing that does not receive federal or state low-income housing tax credits, Community Development Block Grants, HOME funds, National Housing Trust Fund, or funds from the Affordable Housing Trust Fund.
Applications are evaluated based on the community’s housing needs, challenges attracting or retaining talent, the town’s commitment to growing its housing stock, expected occupancy within two years, and the ability to grow and manage the fund.
Beyond this citywide funding pool, Stanton should explore other mechanisms that have been implemented elsewhere. These include:
- Tax abatement
- Reduced lot cost
- Utility incentives, including water, sewer, electricity, and internet
- Waived building permit fee
- 1 year free membership to the Viking Center and makerspace
- 1 year free membership to the Stanton Betterment Association
- If space allows, free daycare for six months during construction
- Up to $100 of fuel during construction
- Free family activity pass to school activities
The Action Steps
Determine funding to bridge gap for housing needs
Meet with State of Iowa to supply 50% of funds
Raise remaining funding gap locally
Stanton Area Industrial Foundation, city leadership, housing committee
Determine remaining gap. Explore three primary options: Tax Increment Financing (TIF) revenue, city bonding, and private and philanthropic investment. Look to use a combination of these sources if necessary.
Q2 2018