Kandiyohi County interested in establishing a housing trust fund

The Kandiyohi County Board next month will conduct a public hearing on a new ordinance to establish a housing trust fund, which can help pay for housing projects across the county.

Dan Olson of Cronen Construction works at a home construction site on Lower Trentwood Circle the morning of Thursday, August 4, 2022.
If established, the Kandiyohi County Housing Trust Fund could provide loans and grants to developers of both owner-occupied and renter-occupied housing projects.
Macy Moore / West Central Tribune file photo

WILLMAR — A recent housing study from the Kandiyohi County and City of Willmar Economic Development Commission showed the county would need to expand its housing options over the next decade. The proposition to create a county housing trust fund could help make that expansion possible.

"The purpose is to create or preserve both owner-occupied and renter-occupied housing for households at or below 115% of the median income," said Jill Bengtson, Kandiyohi County Housing and Redevelopment Authority director.

Jill Bengtson.jpg
Jill Bengtson

Bengtson at the March 7 meeting of the Kandiyohi County Board presented a draft ordinance that would establish the Kandiyohi County Housing Trust Fund. Bengtson and the board have discussed the possibility of establishing a fund for several weeks.

At the meeting Tuesday, the board gave the go-ahead to hold a public hearing on the proposed ordinance to establish the fund. The hearing has been scheduled for 10 a.m. April 4 in the boardroom at the Kandiyohi County Health & Human Services Building in Willmar.

"It is exciting to be at this stage," said Commissioner Corky Berg. "This is a plan that looks well worth tweaking and seeing if we can make this work."


In 2017 the state of Minnesota enacted a statute allowing cities and counties to create housing trust funds to be used to help fund housing projects. So far, 21 housing trust funds have been established across the state.

"Communities are looking to create these funds in order to be competitive for future state funding that will become available and only available to cities and counties that establish these housing trust funds," Bengtson said.

The housing trust fund would be funded a variety of ways. If established, the HRA board said it will commit $175,000 to start the fund. The County Board is also contemplating using American Rescue Plan Act dollars as seed money for the fund. Other contributions would also be accepted.

"Private donations, local public funds or state matching dollars," would all be accepted, Bengtson said.

The draft policies and procedures for the proposed fund lay out exactly how the money may be used. This includes helping public, private and nonprofit housing developers to build new homes; acquire, rehabilitate or resell existing owner-occupied homes; construct new multi-family rental housing; and rehabilitate existing owner-occupied and rental-occupied units. Each available use has its own rules that loan applicants will need to follow, including affordability standards of the residences.

"It is on us to market it," Bengtson said of the fund.

The HRA will manage the fund for the county, and encourage developers to apply and help them through the application process.

Not only will the trust provide financing opportunities for developers, it will also help Kandiyohi County when it is looking for grant funding through programs such as the Small Cities program. The state Legislature has already dedicated money to be used as grants to local housing trust funds and more could be on the way this session. The sooner the county creates its fund, the better.


"There is some urgency for establishing this. There is funding coming from the state government," said Commissioner Steve Gardner. "We need to get this framework in place."

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Shelby Lindrud is a reporter with the West Central Tribune of Willmar. Her focus areas are arts and entertainment, agriculture, features writing and the Kandiyohi County Board.

She can be reached via email or direct 320-214-4373.

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