Brainerd officials pursue grant program to help downtown area

A targeted area of downtown Brainerd may receive financial help for renovation projects through a Small Cities Development Grant Program, but completed surveys are needed first.

Brainerd officials met with commercial property owners to discuss the grant program Wednesday night at city hall. About 10 people attended. At least five expressed preliminary interest in participating in the program, which offers grants or low-interest loans to assist property owners in what are considered blighted areas.

In February, the Brainerd City Council adopted a downtown master plan presented by Brainerd Restoration. One of the plan's main goals is to develop the Laurel Street area with a historic look.

"We have this beautiful plan sitting on the shelf, now we want to implement it," said Mike Brethorst, Brainerd city planner/economic development coordinator.

Commercial property owners could receive assistance with facade and store front renovations, leaky roofs, windows, doors and handicapped accessibility, health and safety issues and code violations that could involve electrical work. Such items as carpet replacement could be involved in the project, but the money would have to come from the owner's matching contribution.

Lisa Graphenteen, Central Minnesota Housing Partnership community development manager who was hired as a grant writer, said the project can be tailored to work best for area businesses. She said the first step involves participation in a survey that will be mailed to business owners in the targeted area. The one-page survey allows property owners to express interest in the proposed program, but is not a commitment for participation. Paperwork will be started if the grant is awarded and business owners may decide whether to proceed at that time.

The grant program requires a targeted area with strict boundaries. The city proposed a west boundary of the Mississippi River and an east boundary of 10th Street. The north border is Front Street and the south border is Maple Street, encompassing Laurel Street.

The program offers a zero percent deferred loan that turns into a grant if a property owner continues to own the building for a set number of years, typically seven to 10 years. A 1 percent to 3 percent low-interest loan is available for longer terms from 10 to 20 years to keep payments low. Maximum loan amounts still need to be set.

Brainerd will have to compete for the grant dollars. Graphenteen said the state receives 80 to 100 applications for the program and typically funds 25 to 30. If Brainerd is chosen in the first round, funds would be available for building improvements next spring or summer. Business owners cannot complete work before those grant dollars are awarded with an expectation of reimbursement.

And a successful program is likely to help future projects for other targeted areas, which could include work on Washington Street, Brethorst said. He added the city could put in an application for a different area every other year.

The city hopes to have surveys returned in the next two to three weeks. A summer community meeting also is planned. The grant application is due Nov. 1.

If a property owner expresses interest through the survey, the city will complete a sample inspection to estimate costs involved. An average of those costs will be used to set maximum limits.

The city participated in a similar grant program 10 years ago. Downtown businessman Ed Menk said there were problems then with the prevailing wage scale based on Twin Cities averages that pushed project costs up. Brethorst said the city can look at paying prevailing wages specific to this area and those costs can be taken into account in estimating renovation costs.

The Small Cities Development Program is administered by the Minnesota Department of Trade and Economic Development with federal funds through Housing and Urban Development. Today the city reported council member Bob Olson was recently appointed to the League of Minnesota Cities Improving Local Economies Committee. Olson is expected to gain information on resources and ideas from other communities that may be used to benefit Brainerd.

A related public meeting has been set for 6 p.m. Tuesday at city hall for people who own and manage rental housing in southeast Brainerd. The purpose of the meeting is to discuss a proposed initiative that would create a rental property rehabilitation loan and grant program for a targeted area in southeast Brainerd.

The proposed targeted area is within the boundaries of South 11th Street, Laurel Street, Southeast 19th Street and Oak Street.