Housing board backs more infrastructure, including support for dozens of new homes in Milbank

John Hult/South Dakota Searchlight – If you’re ready to spend more than $400,000 on a home in Milbank, the city will soon have 33 to choose from.

At least that’s the plan, as presented to and backed by the South Dakota Housing Development Authority board on Tuesday.

The board signed off on an $825,000 loan meant to help cover the cost of infrastructure for the JAG Development, which intends to sell the 33 houses for between $440,000 and $460,000.

The developers had requested a grant, but the board opted against that on the recommendation of Chas Olson, the housing authority’s executive director, and his staff.

“Due to the price points of the homes, South Dakota Housing is recommending this as a loan,” Olson said.

The JAG project was one of two Milbank developments backed by the board in its December meeting. The loan came from the Housing Infrastructure Financing Program, a $200 million pool of state and federal money designed to ease the burden of high inflation for home builders in a state with a high need for workforce housing. Lawmakers passed a bill to implement the program in 2023, after legal wrangling held up the funds the previous year. It covers up to one-third the cost of a development’s roads, sewer lines, street lights and other costs associated with building new neighborhoods.

Unlike every other program administered by the housing authority, the infrastructure program is untethered to affordable housing guidelines. Instead, it lets communities use the money to support the construction of homes in any price range, so long as the prices are justified by local housing market studies.

The explanation for the housing needs in Milbank has a lot to do with cheese. After completing an August housing study that pointed to a need for 50-75 new homes, “Valley Queen, the chief manufacturer there, said they’d be expanding their employment by 150 employees in the next two years,” Olson told the board.

Milbank also has a recently opened hospital, and a new 87-bed assisted living and memory care facility in a repurposed elementary school.

In the space of four monthly meetings, the housing board has committed more than $96 million in taxpayer funding to 57 projects in every corner of the state. This month’s meeting saw support for another 11 projects and one denied grant application — a request for $5.8 million for a Rapid City road upgrade a mile from the nearest new housing development.

The second Milbank project backed on Tuesday will bring 32 homes to the city, in that case selling for $370,000-$385,000. Board members voted to give that project $753,007 in grants.

The largest award by dollar amount on Tuesday went to Brandon, which will use its $6.1 million grant to buy land and develop infrastructure for 145 apartment units and 277 single-family lots.

All told, 84 projects have applied for infrastructure support through the housing authority since the program launched. Taken together, Olson told the board, they amount to $134 million.

“We’re starting to see the light at the end of the tunnel,” Olson said.

In addition to infrastructure program awards, the board voted to back affordable housing projects with money from other programs, among them apartments for those with developmental disabilities in Sioux Falls, housing for the elderly on the Cheyenne River Reservation, modular homes in Martin, and Habitat for Humanity homes in Brookings, Rapid City and Sioux Falls.