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Indiana awards communities $51 million in housing infrastructure boost

By Leslie Bonilla Muñiz, Indiana Capital Chronicle

Posted July 5, 2024

A wooden building frame on a development site. (dbvirago/Adobe Stock)

About a dozen Hoosier communities will split $51 million in state funding for public infrastructure set to support construction of 2,400 homes.

It’s the Residential Housing Infrastructure Assistance Program’s first round of awards. Lawmakers authorized the revolving loan fund last year.

“We would have done what we had to do. But this very much helps,” Jamestown Clerk-Treasurer Lori Hieston said.

Her Boone County community of nearly 1,000 residents is growing.

“When a house comes up for sale here in town, it gets sold pretty quickly,” Hieston said.

The town also wants more local talent to serve a primary employer.

Fukai Toyotetsu Indiana Corp., a Jamestown-based automotive supplier, must largely hire from out of town, per Hieston.

“(This is) providing an opportunity for housing where people can buy a house and live close to where they work,” she said.

Jamestown is preparing for a 199-house development, but its sewer system can only take half the prospective addition. The town plans to use its $1.1 million award to add another tank to the plant.

Fund details

The program stems from 2023’s House Enrolled Act 1005, led by homebuilder Rep. Doug Miller, R-Elkhart.

“I think we’re really trying to look at Indiana and say we’ve got opportunities across the state to help areas that haven’t been helped before,” he said in committee.

Workers with East Bay Municipal Utility District (EBMUD) install a new water pipe on April 22, 2021 in Oakland, California. (Photo by Justin Sullivan/Getty Images)

The legislation allows awardees to use the money on sidewalks, curbs, sewer, water and other infrastructure.

Such expenses are usually built into the cost of residential development projects, but developer and builder groups testified infrastructure costs can hinder housing projects.

Lawmakers hoped to give residential development a boost with low-interest loans for infrastructure expenses.

The Indiana Finance Authority (IFA), the program’s administrator, prioritized projects ready to move forward in the recently begun fiscal year, and in communities that have either recently completed housing studies or demonstrated a need for more inventory. Applicants were also required to have secured other funding to contribute to their projects.

Jamestown was one of 11 communities to obtain an award through the program, which prioritizes rural communities. The law stipulates that 70% of the money go toward local units of government with populations under 50,000 people. The remaining 30% is available for larger cities.

According to an IFA memo, here are the recipients:

Goshen, $11 million
Clarksville, $8.6 million for two projects
Auburn, $5.5 million
Indianapolis, $5 million
Michigan City, $4.6 million
Gas City, $4.5 million for two projects
Fort Wayne, $4 million
Vincennes, $3.1 million
Ossian, $2.5 million
Churubusco, $1.1 million

Each community will start repayment within a year of a project’s “substantial completion.” They have 20-year fixed interest rates and level annual debt service.

Hieston called the initiative a “good opportunity.”

“If we had to go secure money other ways, … it would be a high interest rate,” she added.

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Indiana Capital Chronicle is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Indiana Capital Chronicle maintains editorial independence. Contact Editor Niki Kelly for questions: info@indianacapitalchronicle.com. Follow Indiana Capital Chronicle on Facebook and X.