(KNSI) – The St. Cloud City Council will take early steps on an unusual housing program aimed at heading off a looming shortage of buildable lots, while also considering new parking restrictions near a local junior high and an expansion of the city’s economic development powers.
City staff says St. Cloud is on pace to run out of land for new single-family homes. The city has roughly 237 platted single-family lots left for development, and over the past five years it has issued about 100 single-family building permits a year. At that rate, staff projects the available supply could be exhausted by 2028 unless new subdivisions come online.
To spur that development, the council will consider setting a public hearing for August 3rd on the Single-Family Housing Supply Initiative, a fee-deferral program that would let developers and builders put off paying trunk area charges, sewer access charges and water access charges on new subdivisions rather than paying those costs upfront.
City Administrator Tracy Hodel, who submitted the item, describes the program as a financing tool rather than a subsidy. The city would not waive or forgive the fees. Instead, developers would repay them later with interest, secured through recorded liens or deferral agreements, so the city recovers the full amount plus the investment earnings it would otherwise lose during the wait. The stated goals are to improve project cash flow, cut carrying costs and help builders line up financing.
City staff describes the pilot as the only program of its kind in Minnesota, and it carries an unusual combination of features. Deferring development charges is not itself a new idea. Some Twin Cities metro communities, including Minneapolis and Waconia, already let applicants spread sewer, water and related charges over a multi-year term with interest through the Metropolitan Council’s sewer availability charge deferral program, and the tool is common nationally. Washington State, for example, requires its cities to offer fee deferrals for single-family construction.
What appears to set St. Cloud’s proposal apart is that it would apply to market-rate single-family subdivisions, with no affordable housing requirement attached. By the city’s own account, most deferral programs elsewhere in the country are tied to affordable housing.
If adopted, the program would be open to new subdivisions platted through December 31st, 2027, and would require amendments to city code.
The proposal also runs against recent history. In 2023, the council fought over phasing in these same water, sewer and trunk charges, with the Central Minnesota Builders Association warning the fees could stall badly needed housing. The deferral program reads as the next chapter in that same tension.
Monday’s vote only sets the public hearing. The actual policy debate would come August 3rd.
The council will also consider a resolution creating new parking restrictions along 15th Avenue South near South Junior High School.
The St. Cloud Police Department asked the Engineering Department to address safety problems during parent pickup and drop-off. After a review by the Engineering Department and Traffic Services Division, staff recommends banning parking on the west side of 15th Avenue South between 11th and 13th Street South during set windows: 8:00 to 9:00 a.m. and 3:00 to 4:00 p.m. on school days.
The council will hold a public hearing on a resolution modifying the enabling resolution for the city’s Economic Development Authority.
The EDA is asking to expand its housing-related powers so it can support any type of housing or housing component within its development and redevelopment work. Under the current setup, adopted in 2010 and revised in 2013, the EDA’s role in low- and moderate-income housing has been limited, with much of that work sitting with the city’s Housing and Redevelopment Authority.
Economic Development Director Cathy Mehelich says the change would add flexibility, clarify which agency handles what and create efficiencies, particularly for projects that may rely on a housing tax increment financing district.
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