Sawtooth Cottages housing development issue remains unresolved

Submitted by wtip on Wed, 07/23/2008 - 10:01am

The Economic Development Authority met on Monday, July 21 to make a decision on whether or not to move forward with the Sawtooth Cottages housing development. The project has been in limbo since EDA Director Matt Geretschlaeger recommended the board reconsider moving forward with the development for financial reasons. The board reviewed bids for infrastructure installation that included the cost of building a roadway and installing utilities. The low bidder was KGM with a bid of about $1.6 million. The board hoped to have more information regarding the exact interest rate available on the bonds needed to pay the upfront costs for the project, but as of Monday’s meeting the board had not heard back from the bond authority.

 
Sarah Hannigan, housing development director for Northern Communities Land Trust, reminded the EDA of its agreement with NCLT to build ten affordable homes in the development. “Our organization will be supportive of any decision that is made today, however we are very hopeful you will be able to move forward and honor the agreement that the EDA has with Northern Communities Land Trust so that that the land trust can develop ten affordable housing units for the community,” Hannigan said. 
 
NCLT is ready to begin construction and has hired local contractor Isak Hansen to build the ten homes. Hannigan says there’s been a lot of interest from the community in the land trust homes adding, “We have taken some Grand Marais perspective homebuyers through similar houses that we’ve built in Duluth and they’ve said, ‘Wow, there’s absolutely nothing like this in our community that would be affordable to me and my family. I really hope that you are able to pull this off.’”
 
Hannigan also told the board that the homes would be permanently affordable. “When I say permanently affordable what I mean by that is our investment in the community and in these homes, whether it’s the investment the land trust has made or the funds that the EDA would contribute today, those funds would be forever locked into each of those affordable units through the land trust mechanism,” said Hannigan. “A homebuyer that purchases a home today would agree to sell it to another income qualified homebuyer in the future. So the decision that you make today, about subsidizing these lots and allowing the land trust to move forward with a project that we’ve all agreed upon, is a decision that will carry forward for generations to come.”
 
EDA Board Member Tim Kennedy said that he’d like to see the project move forward but is concerned about being able to make it work financially. “Really this project doesn’t look like it’s economically viable. As much as we’ve tried to support the issue of building affordable housing and making this a possibility—I’m not willing to close the door quite yet, but I don’t know that there is a way out for us. But I’d certainly like to explore all avenues and possibilities,” Kennedy said.
 
The board agreed to postpone making a decision until its next meeting on August 12. The issue will be discussed with both the Grand Marais City Council and the Cook County Board before then.