A quest for affordable housing in Hill City

By Gray Hughes

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Housing in Hill City can be expensive, so expensive that, according to Chris VanNess, a part of the Hill City Economic Development Corporation, that 50 students left Hill City schools the previous years because their families moved out of the area and into places such as Rapid City.

This has made affordable housing the EDC’s number one priority.

“We looked at why this is happening, and one of the issues that came up was that families cannot afford to live in Hill City because of the higher prices of property and housing and taxes and all that stuff,” VanNess said. “So we are losing families who are moving out to other places. They are moving to Rapid City and surrounding communities, and we need families to make Hill City a year-round town to support the businesses and schools.”

The economic development of Hill City depends on keeping families, growing the economy, having a workforce working in businesses, having teachers at the school.

Therefore, it is worth making housing affordable in Hill City, VanNess said, to ensure the economic drivers in the town can afford to live there.

“This is not low income housing,” she added. “It’s middle income housing, and the price range for affordable housing rages is $175,000 $200,000. So that’s about what people can afford on the incomes that they make in this area.”

There is already housing available for those who are retired and are of a higher income level, VanNess said, so the goal of the EDC is to not create more housing overall but to create housing for those who might not be able to afford housing in Hill City currently.

The EDC has created an action plan to put this affordable housing initiative into place.

“We set an action plan in place where we located properties that might be available for building homes,” VanNess said. “And then we put together a packet of incentives and low interest loans and that kind of thing.”

There is a checklist from the state, too, that the EDC has been following to ensure the housing in Hill City is affordable, such as proximity to grocery stores and schools, utilities, and transportation and good roads.

They have located properties in Hill City that is in close proximity to those amenities, and VanNess has been meeting with builders and developers to discuss the next steps.

Once the EDC gets builders on board, the EDC will start to create an incentives package and securing low interest loans.

The builders will then work to ensure the housing is affordable.

“They have to have the building process down to a science,” VanNess said. “One of the builders has modular pieces that are all built in factories, so they can really get economies of scale. They have hundreds of these homes going through these factories. They are all climate controlled so there is no waste, they don’t have weather issues building the modulars, and then they come on site and they can have them up in seven days. So it really minimizes the waste, the labor issues, weather issues and all that kind of stuff.”

Another option would be to put the properties into a land trust so that homeowners own the homes on the property itself but do not pay for the property.

VanNess said she has met with representatives from Dakota Land Trust in Rapid City, who have built properties in land trusts in places such as Deadwood and Spearfish.

“So now the homeowner can just buy a house,” she said. “And they don’t need to worry about escalating land prices and they get equity in their homes so when they sell their home they can get equity and move on and buy something else, but the land always stays in a land trust, and therefore that’s one way of making that property affordable into the future.”

The EDC’s goal is to start building these affordable housing options sometime next summer and are hoping to pre-sell homes.

They also want to give people options, such as the way the house is built.

They are in the process of administering  a survey to gauge what potential buyers would want in their house and what type of house they would want.

“We know we need it, and the housing study said we needed X number of houses each year for the next five years to supply new need that is out there, but what we don’t know is specifically what types of houses people want,” VanNess said. “So our little survey out there is asking people do you want two bedroom houses, three bedroom houses, do you want garages, do you want two car garages, three car garages, would you prefer town home, a twin home, an apartment. So all of these things will help us define what it is we start building first.”

For example, if more people want apartments first, then that is what they will start to build.

They cannot do assisted-living houses right now due to a lack of resources, VanNess said, however, they do hope to do senior housing, as well.

While they want to replace the 50 kids that left Hill City schools last year, that’s not entirely the EDC’s goal.

“That’s just part of it,” VanNess said. “We want to keep our schools. If the population keeps decreasing, we don’t have kids and families here, we are at the risk of consolidation of schools. Maybe Hill City schools go away and we go to Custer or whatever. We have a very good school right now, it is a very high quality school, and we want to keep it. So that is one part of it.”

The other part, she said, is to ensure there is a workforce in Hill City.

People are needed in Hill City to staff the schools and shops, VanNess said.

The project has received “very, very strong support,” VanNess said.

“Everybody kind of knew that we needed it but wasn’t sure how we do it,” she said. “We have had comments along the lines of well, if it could be done we would’ve done it, but we took the approach of it needs to be done, let’s figure out how to do it, and there are other communities that have done it, and so we know it is possible. We just need to work through the process of figuring out how we do that, and economic development is in full support, whatever resources we have we are putting on it.”

The city, too, she added, has been a strong supporter of the project.

They will do whatever they need to do to ensure this happens, whether it’s tax incentives or whatever the EDC sees they need to do, VanNess said.

“We all have funds that we can put into it as soon as we figure out how much is needed,” she said. “The developer is going to handle most of the costs. They are the ones that are going to be buying the property and building the homes, but we are going to help with whatever support we can give, whether it’s money or tax incentives or low interest loans or any of that good stuff.”

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