Alison Madson bought her condo at Sunset Ridge Condominiums in St. Louis Park 20 years ago, intending to turn around and sell the unit. But she liked living there so much that she never left.

With three pools and areas to walk -- the property has five miles of sidewalks -- there's a lot to like about the 240-unit complex built in 1982.

But not the decaying siding, windows and decks.

The Sunset Ridge Condominium Homeowners Association approached a bank for a commercial loan to make repairs and was turned down. Asking every condo owner to acquire financing to contribute to the project would have been "a nightmare," said Madson, president of the condo association.

So where to turn next?

After a vote of residents, the association approached the city of St. Louis Park to ask that it declare Sunset Ridge a Housing Improvement Area, or HIA. That designation, expected to be approved by the City Council this week, would allow the city to sell $4 million in bonds for a loan for the project. Homeowners would then repay the city through additional property taxes.

It's a win-win situation: condo owners get new windows, siding, doors, patios, decks and gutters, paying an average of $18,500 over 20 years, while the city makes a little bit of money off the deal because of the interest it charges.

"This project would not have been possible without [city housing coordinator] Kathy Larsen and the city of St. Louis Park," Madson said. "It was going to be difficult if not impossible to get financing for this project without them."

Cities were granted the authority to establish HIAs in 1996 by the Legislature. The law was renewed this year and now is in effect until 2013.

Sunset Ridge is the fifth St. Louis Park condo or townhouse complex to get an improvement loan through an HIA. Hopkins, Coon Rapids, Roseville, Plymouth, Little Canada and Victoria are among the other cities that have used HIAs to maintain what are called "common elements" in a development. Those include roofing, siding, landscaping and roadways.

HIAs are used only with condos or townhouses. The law says homeowner associations must first apply for regular commercial loans. If they can't get such a loan, they can petition the city. The law prohibits cities from using it to force improvements on properties.

"What's kind of neat about these as a public financing tool is that they are very grass-roots because the initiative comes from the associations," said Jennifer O'Rourke, intergovernmental relations representative with the League of Minnesota Cities. "A lot of condos and townhouses that were built in the 1970s did not have financing set up to deal with maintenance."

Larsen said condo and townhouse associations have trouble borrowing money because they have no collateral -- individuals own all the units. She said older condos that may have started as rental properties often lack the financial reserves for maintenance that newer properties have. And in developments where home values are modest -- Sunset Ridge's units are valued at an average of $118,000, and many residents are first-time home owners -- the financial pressure of paying off more than $18,000 in a short period of time "would be quite onerous," Larsen said.

"We do this to preserve existing homes in the city," she said.

Fifty-five percent of homeowners at Sunset Ridge petitioned the city for the HIA.

Madson said the complex's siding is crumbling and warping and water is wicking into the structures. Windows are drafty and decks are decaying. "It's just in general need of a little revamping," she said.

The new siding is supposed to last 50 years. Madson said the majority of Sunset Ridge's roughly 300 residents are excited about the project, which may not start until next spring.

"There is overwhelming support," she said. "Everyone concluded that something must be done."

Mary Jane Smetanka • 612-673-7380