Craig City Council approved the application for a grant from the Department of Local Affairs to potentially help aid development of housing in the city.

The application will go toward DOLA’s Innovative Housing Strategies-Planning Grant program (IHOP), which aims to expand on the planning that the city is doing downtown for commercial and housing development.

City manager Peter Brixius said on Tuesday that this project would also go toward potential single-family affordable housing locations. Currently, that housing is set to be priced at 140% of the average median income (AMI), which means the average recommended household income would be around $80,000 for the units. They would be for-sale units.

“We call it establishing workforce housing in downtown areas where you have commercial zones, and also on public-private partnerships where we have land to establish single-family homes and how that public-private partnership would work,” Brixius said. “We would talk about planning, and how we would subsidize or otherwise reduce local development review or fees, including but not limited to building permit fees, planning waivers, and water and sewer tap fees for affordable housing development.”

The IHOP grant application is currently requesting $127,350 for a project that will cost $174,500. With this money, the city could help streamline the planning process for developers, an effort that includes passing guidelines in zoning or getting parts of the municipal code in line with developments, Brixius said. It does not apply to every kind of development, just ones that are more difficult to sustain. This would be housing designed for working families.

“We have a group of people that work diligently,” Brixius said. “They have a household income that just doesn’t meet the criteria that we currently have for a 1500-square-foot house, where they have to spend $400,000 to $450,000 a to purchase a place like that — with a lot in utilities and tap fees, and in the construction itself at $200 a square foot.”

The grant covers the development planning process that happens before any development occurs, not the actual execution of development plans.

“Another type might be downtown commercialization,” Brixius added. “We have commercial entities, kind of like the (Golden Cavvy), where it could support development of a property of that type where you have housing above the property, which creates some vitality for the downtown area. Those are a couple of examples.”

According to the grant application, one specific property that could be the target of any potential project is the Woodbury property. Currently owned by the city, it was identified as the “top developable property” by a recent housing needs assessment study because of its existing infrastructure and proximity to amenities.

The housing needs assessment, completed in November, identified 19 properties as prime developable locations. Seven have been deemed “high or moderate priorities.” According to consultants who completed the assessment, Craig has a need for new construction and smaller homes for first-time homebuyers and single-family units.

The application also states that city staff has spoken to four different developers that are looking to begin construction on three of the high-priority properties.