$1.125 million approved for 15 small-city housing grants across Greater Minnesota

ST. PAUL, Minn. — The Minnesota Housing board today approved $1.125 million in housing grants for 15 small cities across Greater Minnesota, supporting local efforts to create and preserve housing opportunities, assist nonprofit housing partners and respond to urgent community needs. 

The funding comes through the Greater Minnesota Small Cities (Tier II Cities) Housing Aid Grant Program, a competitive grant program created in 2023 to help cities with populations under 10,000, located outside the seven-county Twin Cities metro area, address local housing challenges. 

The selected communities will use the funding for a range of housing-related activities, including affordable housing development and financing, support for nonprofit affordable housing providers, and emergency shelter operations. 

Minnesota Housing received 28 eligible applications requesting a total of $2.1 million. Following review by staff and community reviewers, the agency selected the 15 highest-scoring proposals for funding. Each selected city will receive $75,000. 

“Across Greater Minnesota, communities know best what their residents need,” said Commissioner Jennifer Ho. “This funding gives small cities added capacity to move housing solutions forward and support individuals, families, older adults and others who need safe, stable housing.” 

The 2026 selected communities include:  

• Balaton
• Benson
• Brownsville
• Currie
• Deer River
• Floodwood
• Fosston
• Hendricks
• Le Sueur
• New York Mills
• Redwood Falls
• Stewart
• Wells 

Together, these communities represent a wide range of local housing strategies in regions across Greater Minnesota. 

“The City of Deer River’s development of the White Oak Apartments represents a meaningful and critical step toward providing safe, accessible and affordable housing with much needed services for individuals and families in the community.” said Mark Box, Deer River City Administrator. “Partnerships with organizations like Kootasca Community Action and Minnesota Housing are essential to making projects like this possible.” 

The program prioritizes projects that serve lower-income households and help communities develop and preserve housing that is affordable and workforce-ready. 

Applications were scored on five criteria: commitment to affordable and workforce housing, project and program readiness, community need, community impact, and collaboration. 

Following board approval, Minnesota Housing staff will notify selected grantees and begin the grant agreement process. Applicants not selected for funding will be offered a debrief meeting. 

Minnesota Housing’s strategic plan calls for strengthening communities, preserving and creating housing opportunities, supporting people needing services, and making housing more accessible across the state. This program advances those goals by helping smaller communities move local housing solutions forward.