Dakota County leaders want to buy Eagan hotel and transform it into a permanent homeless shelter

Dakota County could soon have its first permanent, standalone homeless shelter run by the county.

The Dakota County Board will officially vote Tuesday on whether to apply for a newly created state grant that would help fund the purchase of the Norwood Inn & Suites in Eagan and convert it into a shelter, but a majority of county commissioners this week signaled they are in favor of trying to get the funding. It would cover up to $10 million of the project's estimated $24 million price tag.

County officials say current, temporary efforts to house homeless people are not a long-term solution for the state's third-largest county.

"There's clearly a need for a permanent location," said Dakota County Commissioner Joe Atkins, who expressed support for a grant application along with commissioners Mike Slavik, Mary Hamann-Roland, Bill Droste, and Laurie Halverson. "You lose so much time and money and effort when you're putting up and taking down a temporary location."

Dakota County has seen a growing number of homeless residents over the last decade, county officials said, and buying a hotel would not only provide shelter for people experiencing homelessness but a place to receive county-run social services, too.

"This would give us our own space that we manage and control," said Madeline Kastler, a Dakota County deputy social services director.

The project would also create one of the first permanent homeless shelters for single adults in the Twin Cities suburbs, county staff said.

County officials have had some conversations with the owner of the Norwood Inn, which is located on Rahncliff Court, south of Cliff Road and just west of I-35E. The grant application would include a non-binding letter of intent with the owner, Kastler said.

Before the pandemic, the county worked with a nonprofit to run a homeless shelter during the winter that rotated among various south metro churches. More recently, the county has housed homeless adults in an Extended Stay America hotel in Eagan and contracted with Ally Services and the Link, which use hotels as shelter space.

There's also Dakota Woodlands in Eagan, a nonprofit-run shelter supported partly by county funds, for women and families.

Slavik said he wouldn't support buying the hotel unless the county gets the $10 million grant.

"The state was really the driver in being able to go and provide these services and this opportunity," he said.

Kastler said two other Dakota County nonprofits — 360 Communities and Dakota Woodlands — have also said they may apply for the grant.

Location matters

County officials estimated the cost to operate and staff the hotel as a shelter would be about $2.8 million a year. The county is currently spending $3.2 million on its various shelter options, including a lease at an Extended Stay America in Eagan for $1.7 million.

It's still early in the process, said Evan Henspeter, Dakota County social services director, adding that the county still needs to receive approval from Eagan officials. The county would have to match 10% of the grant amount. If all goes as planned, the shelter would be built during the second half of 2024.

A Dakota County presentation showed a sample floor plan of what looked like a typical hotel room. Residents would get individual rooms, each with an attached bathroom, county officials said. There would also be space for a congregate, or group, shelter at the hotel.

The county would need up to 55 of the hotel's 121 rooms. Henspeter said officials aren't sure what the extra rooms would be used for.

Slavik said location was a key reason the county chose the Norwood Inn.

"One of the aspects of why location really matters is to have something close to transit, so individuals who are experiencing homelessness can go to jobs and go to doctor's appointments," he said.

The county's previous shelter for single men, called Cochran House, closed in late 2017. It was located in Hastings, in an isolated area that was a mile from major roads and businesses, he said.

Not everyone is on board with the project. Commissioner Liz Workman said the plan sounded like a "money pit."

"I just would not support this," she said.

Halverson said cities are concerned about homelessness and this shelter could help solve the problem. Social services would be provided on-site, she said, adding that people would be referred to the shelter rather than lining up outside.

"It feels to me like the bones are really there," she said of the project, adding that she believes the county is "way more ready" than officials previously thought.