How the city is looking to fill housing gaps

Megan Raposa -

Simplified: City Council in the coming months will be asked to approve two different projects aimed at bringing more affordable housing options for those most at-risk of homelessness.

Why it matters

  • Research conducted last fall showed the most significant need for housing in Sioux Falls is among those who make make 30% or less the area median income (AMI) – which is $17,350 for an individual and $26,500 for a family of four.
  • To help address that need, the city committed $4 million in one-time funding to a "Housing Needs Fund" – supplemented by an additional $1.8 million in federal funds.
  • Now, the first two projects within that fund could bring as many as 156 housing units, with 37 of those priced to be affordable for those lowest-income folks. Case management services are also part of the equation to help these new tenants get into a more financially stable situation.
"This is a really exciting opportunity," Housing Development Manager Logan Penfield said. "I don't know any other way to put it. It's a really exciting opportunity for the city to be involved in this at this scale."

Tell me more about these affordable housing projects

The first project – for which City Council approved the contract on Tuesday – is focused on creating housing for low-income families, particularly single parents.

  • The city will loan $1.8 million to Inter-Lakes Community Action Partnership (ICAP) to purchase and rehabilitate two properties along South Second Avenue near downtown.
    • The portion of those loans used to fix up the buildings will be forgiven, and the rest of the payments will be deferred.
  • In exchange, ICAP will create 12 family-focused affordable housing units. Tenants in those units will receive services from the nonprofit's Bright Futures program, which offers both rental assistance and hands-on coaching to learn how to maintain permanent housing.
"We have some of the best success rates in the country with what we do," ICAP's Chief Operating Officer Mike Anderson told City Council earlier this month.

Altogether, it's a fairly unique project for the city to be a part of, Penfield said. And because it's just the city working without extra help of state or federal funds, it's a bit more expensive, a fact noted by City Councilor Curt Soehl during a presentation last week.

"At that income level, you're a lot of times looking at single moms, and (this project offers) all sorts of resources to help get them on their feet," Penfield said, adding that the location is within walking distance of a grocery store, a park and a bus stop.

What about the second project?

The second project is a partnership with Devco, a Washington-based company that specializes in affordable housing projects. It's the first time this company is working in Sioux Falls, Penfield said.

  • In total, it's about a $45 million project that'll create 144 total affordable housing units.
    • The city's buy-in would be to provide $1.8 million to essentially subsidize 25 of those units to ensure they can be affordable for those folks most at-risk of homelessness.
  • The developer is also taking advantage of a low income housing tax credit option that will allow them to further drive down costs.

This project will be located near 57th Street and Western Avenue in the open space just east of JJ's Wine, Spirits & Cigars.

What happens next?

The ICAP project has already received council approval, and the Devco project has tentative approval with a goal to break ground yet this year, Penfield said.