Hoiseth says CHEDA will cover all costs, meaning no City funds will be needed

    After a closed session to discuss the matter Monday evening, the Crookston City Council voted unanimously in favor of accepting offers from the Crookston Housing & Economic Development Authority (CHEDA) on the three City-owned residential lots carved out of a portion of Hoven Lane Park to provide a premium “in-fill” housing opportunity.

    The trio of lots, as part of a city council strategy that involved contracting for one year with Century 21 Red River Realty, were initially priced at the market rate, in the $20,000 range. When that price-point spurred little interest, the lot prices were subsequently reduced to $12,000 each. When that also failed to spur a lot of interest from potential buyers, CHEDA stepped in, with CHEDA Executive Director Craig Hoiseth saying last week that CHEDA, working in partnership with the Northwest Minnesota Housing Cooperative, was prepared to make an offer on all three lots and that three homes would be built on them within three years. Hoiseth’s board directed him to come up with an offer, and Monday the council agreed to sell the lots for $1,000 each. Acknowledging the steeply discounted sale prices, council members and Mayor Wayne Melbye indicated that the minimal price was at least offset by the likelihood that three new homes would be constructed on the lots in three years.

    “I’m OK with this, I just wish CHEDA had come forward quite a while ago if they were interested in these lots,” Ward 5 Council Member Dale Stainbrook said. “I think $1,000 is a pretty low-ball offer and there are other ways we could have done this, but it is what it is.”

    Last week, there seemed to be a possibility that CHEDA would be OK with offering $12,000 for each of the lots, but at that price point it was also likely that CHEDA would go to the council and request the funds to cover the purchase. That led to some in the community to question the sense of the City essentially paying to purchase lots that it already owns.

    But at a cost of $3,000 total for the trio of lots, Hoiseth told the Times Tuesday that CHEDA will provide the funds to buy the lots and will also cover any realtor commissions, transfer fees and closing costs. The transactions will require no money from the City, he said.

    “We are thankful for the City having confidence in CHEDA to accomplish this mission of creating new tax base and providing additional housing opportunities in Crookston,” Hoiseth told the Times. “We will partner on this endeavor with the NWMH Co-op and perhaps also with the Crookston School District as well (through the Construction Trades program), as we seek to add in-fill housing that fully complements the neighborhood.”  

    Of the realtors that bid to contract with the City on marketing and selling the Hoven Lane lots, in addition to eight lots on Pirate Drive in the northeast corner of Crookston, Century 21 Red River Realty was the only bidder to not include a minimum commission. City Administrator Shannon Stassen told the Times Tuesday that discussions are taking place regarding what would be a fair realtor commission “in this unique situation.”