Area flooded in 2008 targeted for new Cedar Rapids housing

The City Council has decided to use a third round of federal disaster housing subsidies in its Single-Family New Construction Program to replace homes where they were lost to the 2008 flood.

To date, the city has secured two rounds of federal Community Development Block Grant funds to cut the cost to build new owner-occupied homes, duplexes and condominiums. In total, the first two rounds of funding have been sufficient to support 438 new owner-occupied residential units, but nearly all the construction has taken place far from any of the city's flooded neighborhoods.

A third round of funding, totaling up to $11.13 million, is expected to allow support for the construction of 235 more homes, and the council decided last week that it wants that construction to take place in the city's Neighborhood Revitalization Area. The area consists of blocks hit by the 2008 flood but that are outside the 100-year flood plain and outside the construction zone for a new flood protection system.

The city estimates that it owns or will own more than 250 vacant residential lots in the Neighborhood Revitalization Area once the buyouts and demolitions of properties is complete.

“Nobody wants these properties bought out faster than the city so we can use this round of funding in the appropriate place where we want to see housing built,” council member Chuck Wieneke says.

Council member Don Karr says the city's plan would be to donate city-owned lots to homebuilders and offer free hookup of water and sewer to keep the price of the homes down for the new owners. The program subsidies provide new owners, who meet household-income guidelines, a forgivable loan equal to up to 25 percent of the cost of the home.

Of note, the city, to date, has only signed contracts on 127 of 254 residential units in the second round of funding.

Karr sad the city will see if some of the second-round funds might also be directed to the Neighborhood Revitalization Area.