December 16, 2025. Lake County Service Center, Split Rock River Room (SRRR), 616 Third Avenue, Two Harbors, Minnesota. A public hearing was convened at 2:30 p.m. to consider granting a property tax abatement under Minnesota Statutes, Sections 469.1812 through 469.1815 (the “Tax Abatement Act”). The proposed tax abatement would apply to a housing development project to be constructed by Vision Inc. on property located on five (5) acres in Two Harbors, on the Northwesterly portion of parcel 23-7600-36370 (the “Property”). The project is expected to consist of an approximately $17.4 million Class A 75-unit workforce apartment complex, to be called North Shore Flats. Under the proposal, the County would abate all or a portion of the County’s share of property taxes levied on the Property for up to fifteen (15) years, with a total estimated amount equal to $525,000. The purpose of the proposed abatement is to encourage the development of needed, affordable and workforce housing, promote economic development, and increase and preserve the tax base within the County.
The following Lake County Board of Commissioners members were present: District 1 Commissioner Joe Baltich, District 2 Commissioner Derrick L. “Rick” Goutermont, District 3 Commissioner Richard C. “Rick” Hogenson, District 4 Commissioner Jeremy M. Hurd, and District 5 Commissioner Rich Sve. County Commissioner(s) Absent: None
Also present in the SRRR: County Administrator Matthew Huddleston, County Sheriff Nathan Stadler, Interim County Attorney Lara Nygaard, Interim Auditor / Treasurer Ronelle “Ronni” Radle, County Environmental Services Director Christine McCarthy, County Emergency Management Director Warren LaPlante, Lake County Housing and Redevelopment Authority (LCHRA) Director Matthew Johnson, LCHRA Board member Paul Iversen, North Shore Development Co. founder and developer Jason Hale, and Clerk of the Board Laurel D. Buchanan.
Present via interactive technology: Chief Executive Officer (CEO) Ryan Nelson of Vision, Inc.
Board Chairperson Rich Sve turned the floor over to Lake County Housing and Redevelopment Authority (LCHRA) Director Matthew Johnson to provide an overview of North Shore Flats’ Tax Abatement Financing (TAF) Application. Vision Inc. is seeking to work with the City of Two Harbors, Lake County, and the Lake Superior School District to secure Tax Abatement Financing (TAF) for the construction of 75 market-rate apartment units in Two Harbors, Minnesota.
Minnesota State Statutes §§469.1812 through §§469.1815 establishes the criteria and procedures to be utilized in administering TAF, although each jurisdiction has the ability to create a customized TAF policy. Part of the purpose of the application is to clarify that North Shore Flats meets the statutory criteria and to verify why TAF is necessary for this project.
The North Shore Flats project consists of building an approximately $17.4 million Class A 75-unit workforce apartment complex on a five-acre parcel of land near the corner of Omtvedt Boulevard and 15th Street. The proposal has strong stakeholder support, including financial commitments from the Lake County Housing Trust Fund (LCHTF) and the Iron Range Resources & Rehabilitation (IRRR) Board, along with a large financial investment by Vision, Inc. The application outlines the cost of materials.
LCHRA Director Matthew Johnson advised that Vision, Inc. has a wealth of experience in these projects and has developer equity. The LCHRA board has approved use of housing trust funds. The request is for TAF in the form of a 90% rebate. The developers will have a construction loan. LCHRA Director Matthew Johnson advised that we are targeting workforce housing availability for local jobs.
LCHRA Director Matthew Johnson relayed supportive feedback received from multiple local employers, the Lake County Chamber of Commerce, LaBounty, medical facilities, Castle Danger Brewery, the City of Two Harbors, Lake County, North Shore Lumber, Louise’s Place Café and the Rustic Inn Café. Aspirus Lake View Hospital, the Lake County Chamber of Commerce and Park State Bank have provided letters of support for North Shore Flats project. The North Shore Flats project has bolstered the community’s hope that substantial housing relief is on the way. Numerous stakeholders, major employers, and family-owned businesses have also expressed their frustration with the challenge of being able to hire new employees, mainly citing the lack of available housing as the key issue. In addition, these same voices have indicated that retaining existing employees is also challenging, as the commute from the Duluth area or beyond eventually takes its toll as wasted time and money. The current housing stock in Two Harbors is simply not adequate to accommodate the high demand for workforce housing.
North Shore Development Co. founder and developer Jason Hale spoke about the status update with the City of Two Harbors. The proposal meets multiple criteria. This comes with a Development Agreement. Ryan Nelson of Vision, Inc. spoke about the development and the consideration of the project. County Commissioners had questions and comments. Site clearing is planned for winter, and ground-breaking is planned for spring. The school board’s public hearing on this is set for January 6, 2026.
Based upon the information presented in this application, the North Shore Flats meets the following criteria for TAF as prescribed in Minnesota State Statutes §§469.1812 through §§469.1815:
1. The North Shore Flats project will increase or preserve the City, County and School District’s tax base; and
2. The North Shore Flats project will increase or retain the number and diversity of local jobs that offer stable employment and/or attractive wages and benefits; and
3. The North Shore Flats project will create affordable and workforce housing.
The 75-unit North Shore Flats project includes an approximate mix of studio (32), one-bedroom (30), two-bedroom (8); and an additional five (5) units will be reserved for low-to-moderate income households (subject to final funding approvals). Features include private balconies, in-unit laundry, ADA accommodations, and elevator access. Residents will enjoy exclusive amenities, including a community room, 24-hour gym, outdoor spaces, and covered, heated parking.
A Sworn Construction Statement (SCS) outlining approximately 100 categories of projected expenditures was submitted as part of the IRRR Housing Grant application. The SCS outlined $17,386,049 of total construction expenses. Some of the major expenditures include $1.2 million each for plumbing, electrical and energy efficient HVAC system. Other labor categories include $700,000 for framing carpentry; $500,000 for drywall; $400,000 for blockwork; and $250,000 for siding, all paying according to prevailing wages. The total project cost is based upon current construction and material costs and comparing the SCS for the recently completed Gunflint Vue in Grand Marais (51-unit mixed-income apartment complex). Materials and labor costs are likely to increase the longer it takes to secure the project’s financing package.
The proposed resolution for Lake County is as follows, for Approving Use of Tax Abatement Financing (TAF) for North Shore Flats Development in Two Harbors:
WHEREAS, Minnesota Statutes 469.1812 through 469.1815 establish the parameters of using Tax Abatement Financing (TAF) for development projects that have public benefits, including, but not limited to, increasing the County’s tax base; increasing the number and diversity of local jobs; and creating affordable or workforce housing opportunities; and
WHEREAS, Vision, Inc., is proposing to build the North Shore Flats apartments in Two Harbors, which will include the new construction of 75 market-rate apartments at an estimated cost of $17.4 million; and
WHEREAS, Vision, Inc., has requested the use of TAF from Lake County, the City of Two Harbors, and the Lake Superior School District, of which 90% of the taxes paid annually would be rebated for the duration of 15 years; and
WHEREAS, Lake County has an adopted Tax Abatement Financing Policy that establishes criteria on the use of TAF along with a list of agreements that shall be made between Lake County and the developer as conditions to the TAF.
NOW, THEREFORE, BE IT RESOLVED, the Lake County Board approves the use of Tax Abatement Financing for the Vision, Inc., North Shore Flats development in Two Harbors of which 90% of the taxes paid annually would be rebated for the duration of 15 years subject, to the terms and conditions outlined in the required TAF agreement.
Board Chairperson Rich Sve opened the floor for public comments. No public comments were made. The Lake County Board of Commissioners and Office of the County Administrator received no written comments in advance of the public hearing.
The public hearing was closed at 2:50 p.m. on Tuesday, December 16, 2025.
ATTEST:
Laurel D. Buchanan
Clerk of the Board
Rich Sve, Board Chairperson
Lake County Board of Commissioners
** The County Board of Commissioners approved the above board resolution at its regularly scheduled meeting on Tuesday, December 16, 2025, by Resolution No. 25121604.
Northshore Journal: January 2, 2026
