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Housing Development Subsidy


Tuesday, February 11, 2020; 12:00pm Central Time

Commissioners Board Room, McKenzie County Courthouse, 201 5th St NW, Watford City

PURPOSE: discuss statistics from 2019 regarding the program, and solicit comment on if the program were to continue if there should be any changes to it.  Some changes that have been suggested include:

·         Allow for manufactured homes that are built to IRC codes and meet the JDA building requirements

·          Increase max city lot size from 10,000 square feet to one acre to allow for infill

·         Completion of foundation increased from 30 days to 60 days

·         Provide more flexibility in the house sale price while still taking advantage of the maximum subsidy amount

  Written comments can be submitted via email to by noon on Feb 12. 

McKenzie County Job Development Authority Housing Development Subsidy Program 

Inadequate supply of quality, affordable housing is currently a hindrance to the continued economic development of McKenzie County. Most industries in our county —the largest of which is the petroleum industry—are reporting a workforce shortage and many attribute a lack of quality, affordable housing as a contributing factor in attracting and retaining their needed workforce. In 2018 the petroleum industry provided over $78 million to McKenzie County in gross production taxes; and of the 2018 property tax monies levied, over 83% was paid by pipelines and commercial properties.

This pilot program incentivizes the construction and sale of quality, affordable housing in McKenzie County by providing a development subsidy up to $50,000 per single-family house to offset infrastructure costs for qualifying housing projects.

Interested developers will submit application (see link below) at the same time as, or after, the building permit.  Qualifying property must appraise above the current FHA Mortgage Limit (2019 being $314,827; 2020 being $331,760). The purchase price will not exceed $5,000 above the appraised value. For applications approved in 2019 and house closing happening in 2020, applicants can use either the 2019 or 2020 FHA limit as the floor. For applications approved in 2020 and house closing happens in the same year, the 2020 FHA limit will be the floor.

·        The homebuyer's loan amount cannot exceed the FHA Mortgage Limit. The Development Subsidy amount will be adjusted based on the purchase price of the house and if it is built with complete or limited infrastructure as defined as

o   Complete—curb, gutter, sidewalk, municipal water, municipal sewer—up to $50,000 per house

o   Limited—municipal water and municipal sewer in a city; or in a county subdivision that has improved gravel road and septic—up to $25,000 per house

·         No more than $25,000 will be awarded to a house with limited infrastructure, and no more than $50,000 will be awarded to a house with complete infrastructure.

·         The homebuyer will give a 5-year lien to the JDA for the Development Subsidy amount that will be forgivable so long as the property remains their primary residence during that time.

·         Total funds expended during the pilot stage will not exceed $1,000,000. Accepted applications must complete the basement/foundation within 30 days of application acceptance and finish the house within 12 months of application acceptance. It is the goal of the program to have a variety of sellers and areas of the county to be impacted with this program. 

·         Construction of the house must have started on or after January 1, 2019. 

·         The  funds become available at closing. Checks are cut twice a month--the first and third Tuesday of  the month. In order for funds to be awarded, the appraisal must be submitted and application's qualification requirements must be verified by a city/county inspector. Check requests must be made by noon the Tuesday before.   

·         The McKenzie County Job Development Authority cannot advise the parties of potential tax implications the program may create. It is ultimately the responsibility for the parties involved in the transaction to understand any income tax implications that may arise out of the program.

Probable Impact: construction and sale of 20-30 stick-built single family homes in McKenzie County  in 2019-2020.


Private Mortgage Insurance Requirements:

***As of December 3, 2019, $450,000 of the $1,000,000 budget has been allocated. ***

To find other homeownership programs consider visiting the programs webpages of ND Housing Finance Agency and the Lewis and Clark Development Group

McKenzie County

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