Redwood Industries plans new housing subdivision near RVHS

Several years ago, a private company proposed building a 72-unit apartment complex in the wooded lot directly across from Redwood Valley High School.  That plan’s financing fell apart for various reasons, and the original developers abandoned the effort.  However, Redwood Industries has stepped forward with an entirely new plan to develop housing on the lot.

The plan, as presented at the Redwood Falls City Council meeting Tuesday, is for turning the wooded area into a 23-lot planned housing development, consisting of two six-plex apartment buildings, and 21 single-family lots.  Bob LeSage, of Redwood Industries, told the council, “It’s a big puzzle trying to put all the pieces together, but we’re about 75-80 percent there. This can only work with the participation of everyone.”  LeSage added the school district has been especially supportive of the effort, being willing to sell Redwood Industries additional land for the purpose.  As currently planned, the 21 lots set aside for single-family houses would be about half the size as other lots the city owns for housing.  The 21 lots would be used for “patio” homes, smaller homes for couples starting out, or for retired couples or individuals not needing larger quarters.

Redwood Industries estimates costs associated with developing this new subdivision include:

• $400,000 in private street and utility improvements

• $140,000 paid to the school district for land acquisition

• $40,000 for engineering

• $100,000 for a Union Drive assessment.

The previous developers of that lot had planned on getting a city subsidy through the use of tax increment financing.  However, Redwood Industries said it would help its financing efforts better if they could arrange for a tax abatement plan instead.

As a result, on Tuesday the city council approved a plan to help the effort by waiving the $100,000 Union Drive assessment, and by providing a $170,500 forgivable loan.

Redwood Falls City Administrator Keith Muetzel said the arrangement “is very low-risk for the city”, and called the agreement “a wonderful arrangement” because the city wouldn’t front any money for the construction, the developer is responsible for all costs of improvements, and the total subsidy of $270,500 would be repaid to the city in a maximum of 11 years.