Phase two of Coon Rapids’ Home for Generations is planned

The city of Coon Rapids will soon be rolling out phase two of its Home for Generations program.

At a work session Feb. 5 to go over a series of guidelines for Home for Generations II, the council directed that it be brought back to a regular council meeting in the next month for formal approval.

According to Kristin DeGrande, city neighborhood coordinator, the items will be on the council agenda Feb. 19 and the plan is to launch the marketing of the program at the 15th annual North Suburban Home Improvement Show Saturday, March 23, 9 a.m. to 3 p.m., at the Andover Community Center.

The city of Coon Rapids is one of the sponsors of the show, which drew 100-plus exhibitors and more than 1,300 visitors in 2012.

Through the original Home for Generations program, for which the city has received statewide and national recognition, the Coon Rapids Housing and Redevelopment Authority (HRA), which comprises the seven members of the council, purchased older vacant and/or foreclosed properties, remodeled them to more modern standards and then sold them.

Over the course of the program, five older vacant/foreclosed homes in the city were purchased, remodeled and sold, the last in early 2012.

And in doing so, the homes were showcased to some 8,000 residents through open houses before, during and after the remodeling work.

But the council decided last year to end the Homes for Generations program in its original form and at a work session in September, it began consideration of a second phase.

“The housing economy in Coon Rapids has since become strong with a lower supply of houses on the market, less days spent on the MLS before selling and an increase in the average median sales price,” DeGrande wrote in a memo to the council.

The phase two program would offer both technical and financial assistance to individual homeowners to encourage large projects to remodel their homes.

Technical assistance would be offered to homeowners to promote good design and a dedicated city building inspector would be assigned to each project, according to DeGrande.

Incentives would include a portion of the building permit costs being refunded once the project is completed, plus a city financial contribution, DeGrande wrote in her memo.

“This program is intended to spur private investment at a time when the housing economy is starting to rebuild and stabilize,” she said.

Following the September council work session and comments from councilmembers, input from contractors and staff suggestions, revisions were made to the guidelines, according to DeGrande.

Under the new guidelines, an incentive grant would be offered to homeowners, rather than a tax rebate, with two options on how that could be structured, DeGrande told the council.

In addition, the proposal includes a rebate of 50 percent of building permit fees, she wrote in the memo.

Both the incentive grant and the building permit would be financed from the city’s HRA account, DeGrande said.

The Coon Rapids Mortgage Assistance Foundation (CRMAF) is interested in funding the architectural and landscape consultations, as well as sponsoring an architectural and design expo, according to DeGrande.

The foundation was established in 1979 to allow the city to issue low interest housing bonds to boost new housing construction at a time of high interest rates.

The $45 million housing revenue bond issue was paid off in March 2003. Mortgage payments from homeowners who benefited from the bond issue paid off the bonds.

And the money that has built up in the foundation coffers over the years has been allocated, for the most part, to housing and rehabilitation projects in Coon Rapids.

Once approved by the council, architectural/landscape design firms will be contacted to see if they are interested in providing the technical services to the city, according to DeGrande.

And she hopes that the program will be ready to process its first applicants in June, DeGrande said.

But she said that homeowners who sign up for the architectural/design consultation are under no obligation to move on to the construction phase.

Under the proposal, participants must be a current Coon Rapids homeowner, must reside at the home to be remodeled as their primary residence, the remodeled home must maintain homestead status, the eligible home must have been built before 1990, the eligible home must have a property tax value of $250,000 or less and the property will no longer be part of the program if it is sold, is no longer the participant’s primary residence, becomes non-homestead or is rented out.

To qualify for the program, the total project cost must exceed $35,000 and the project scope must include at least one of following project types:

• Addition of living space such as building an addition to the house, building a three-season porch as defined by building code, finishing previously unfinished space in the basement or attic, building a covered front porch and/or enclosed entry (not decks) and conversion of garage space into living space with replacement by a new garage is eligible, too.

• Major remodeling, including major kitchen, bathrooms or basement, addition of a new bathroom or moving a wall around in existing room.

According to DeGrande, other types of projects that would be eligible – siding, windows, mechanical updates and roofs – but only in conjunction with the other eligible improvements.

First, participants would be encouraged to schedule a free remodeling adviser visit with the Center for Energy and Environment (CEE) to gain some insight for remodeling ideas and/or setting priorities.

Then, applicants would be required to take part in architectural/design consultation to assist in developing the scope of work and encouraging good design.

This would likely be a two-hour consultation and would not including the drawing of blueprints.

The city would cover the majority of that cost (about $250) with the applicant contributing a $25 co-pay; the same would apply to a consultation with a landscape architect if that’s part of the remodeling project, according to the guidelines developed by DeGrande.

The annual budget maximum for the consulting work would be $5,000.

Under the building permit process outlined in the guidelines, the minimum project value of $35,000 must be verified by the city building official and 50 percent of the building permit fees will be rebated once the project is finished with the goal that most program participants will use this money for project upgrades, appliances or carpeting, DeGrande wrote in the memo.

There would be a streamlined plan review process for each program applicant and a dedicated building inspector would be assigned to each project; that inspector would be applicant’s point of contact for any construction or building code related questions.

The annual budget maximum of building permit rebates is pegged at $5,000.

The proposed incentive grant options are five-year incentive of up to $1,000 a year to stress longevity and retaining ownership or a one-time incentive up to 10 percent of the project cost but not to exceed $5,000 if the project includes two more eligible upgrades or 5 percent of the project cost not to exceed $2,500 if the project does not meet those criteria.

“The incentive would stress improvement in our housing stock and the likely domino effect exterior improvements have on our neighborhoods,” DeGrande wrote.

The proposed annual budget maximum is $20,000.

Funding sources for the phase two program outlined by DeGrande are $20,000 a year from the HRA for the incentives, $5,000 annually for the building permit rebates and $5,000 from the CRMAF for the architectural/design consultations.

Applications would be accepted on a first-come, first served basis until funds are depleted, according to DeGrande.

“The program guidelines have been kept as simple as possible,” DeGrande told the council at the Feb. 5 work session.

There was some council discussion about the possibility that some exterior remodeling could create a “mansion” in a regular residential setting.

But Councilmember Jerry Koch said the exterior project would “add character to the neighborhood,” while DeGrande said the architectural/design consultation would advise program participants “on what would work and what would not work.”

Councilmember Bruce Sanders liked the concept. It would cover 97 percent of the homes in the city that need updating, he said.

In directing staff to bring the second phase of the Home for Generations program back to formal approval, the council also requested that a marketing plan be included.

In the guidelines, DeGrande outlined steps that staff would take to get the word out about the program besides the unveiling at the home improvement show.

• Kickoff event inviting homeowners to come to the city center and talk with architects, designers, building inspectors, other city staff and contractors.

• Showcase remodeling projects on CTN cable television, with the owner’s permission.

• Create a photo book on the city’s website displaying other house remodels in Coon Rapids, including past Home for Generations houses.

• Showcase and award the best remodel of the year.

• Link participants to other financial and remodeling resources.

In the first year of the program, DeGrande said she hopes eight to 10 homeowners take advantage of the program.

“Of course, it would be great if we run out of money, but it is a new program that might take a little time to ramp up,” she said.

Peter Bodley is at peter.bodley@ecm-inc.com

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