$6 million housing trust fund proposed in Duluth

DULUTH – City leaders are proposing a $6 million housing trust fund to improve and increase Duluth's aging and limited housing stock.

"We are investing more than this community has ever invested and finding not just short-term but long-term strategies," Mayor Emily Larson said at a news conference Thursday. "Having safe, affordable housing makes life possible."

If approved, loans and occasionally grants will be available for bringing dilapidated properties back to life; supporting infill projects such as accessory dwelling units; and gap-financing larger multifamily projects.

"The greater the extent there's affordability in these projects, the greater the opportunity for loan forgiveness and grants," said Jason Hale, the city's senior housing developer.

Larson has proposed moving $4 million from the city's $26.8 million community investment trust to seed the housing fund. Local Initiatives Support Corp. will administer a second fund starting with $2 million and hopes to fundraise an additional $3 million with donor support.

The trust fund was a major recommendation from a housing task force that was convened in 2019 and issued a report in early 2020.

The Duluth City Council will take up the initiative at both of its October meetings.

Already, the council has passed a maximum levy that includes $325,000 in yearly contributions to the housing trust fund, though the final budget with that spending will not be approved until December.

The city has also committed to spending about $19 million in American Rescue Plan funds on affordable housing, the largest single share of the $58 million Duluth received in the federal pandemic relief package.

A 2019 report found Duluth is in need of more than 3,500 affordable housing units to keep up with demand among those who make less than the area's median household income of about $50,000.

City Council Member Zack Filipovich said the trust fund proposal is "pro-business" as many firms have been unable to attract workers or candidates due to a lack of housing in the region.

"People make our economy work and people grow our tax base," he said. "So let's make it easier for people to build a life in Duluth."

Brooks Johnson • 218-491-6496