Although the state offered $1 million in forgivable loans to north Minneapolis residents to repair their tornado-damaged homes, only five homeowners have qualified for the loans while nearly 500 homes remain unrepaired.

With winter approaching, the city is asking the Minnesota Housing Finance Agency to waive an eligibility requirement that is preventing low-income homeowners from getting the loans. City housing officials say more Quick Start loans could repair 33 to 50 additional homes.

Tom Streitz, director of housing and policy development for the city of Minneapolis, said he drafted a letter Friday to the agency.

It's not clear whether the state will change its rules. "We are going to take any request we receive from Minneapolis very seriously so that individuals can be served," said Michael Haley, assistant commissioner for single families with the housing agency.

Louis King, leader of the Northside Community Response Team, a group coordinating relief efforts, said if the Quick Start funds are not made available, families with children will be forced out of uninhabitable homes this winter and become homeless.

"I think it will be a travesty if we can't get the money," King said.

After the tornado, the Housing Finance Agency announced the availability of $1 million from its Quick Start fund, which comes from state appropriations and are "a resource of last resort" to individuals whose homes have been damaged through a natural disaster, Haley said.

To be eligible, applicants must first be rejected for a federal loan from the Small Business Administration. But some homeowners did not apply for SBA loans by the deadline, making them ineligible for Quick Start loans.

Streitz's letter asks the housing agency to waive the requirement that the homeowner applied for the SBA loan if their income was so low they would have been rejected anyway, said Cherie Shoquist, the city's foreclosure project coordinator.

Only $150,000 in Quick Start money has been paid out on five homes, Shoquist said.

The city is also applying for another $1 million in tornado aid from a separate fund of the housing agency. Haley said the agency board will consider it at its November meeting.

About 2,000 homes were damaged when the tornado roared through the North Side on May 22, says Thomas Deegan, the city's director of housing inspections. He said a visual survey by his staff in September found exterior damage to 492 properties, including 232 with tarps on their roofs, 37 with chimney damage, 217 owner-occupied properties with other damage, 61 rental properties with other damage and 182 that appeared to be vacant. Some buildings had damage in more than one category.

Some of the 492 homes are now being repaired or awaiting insurance payouts. Neighborhood groups have been given the 492 addresses and are going door to door to determine who may need assistance.

Deegan said he's hopeful repairs will be at least started on all occupied and damaged homes by Dec. 1. His staff plans to check on the remaining 182 buildings to determine those that are temporarily vacant and those that have been abandoned.

The state housing agency also requires homeowners seeking Quick Start loans to have property taxes and mortgages paid and up to date. So philanthropic groups are being asked to help homeowners with taxes and house payments unless the mortgage payments are too far behind, Shoquist said.

Billy Bisson, 43, whose home insurance was canceled a month before the tornado, is one of the handful of residents who got a Quick Start loan. He said he received $29,700 and was calling contractors Friday to get the work done on his home near the intersection of Dowling and Dupont avenues.

During the tornado, his house lost a quarter of its roofing shingles, most of his windows and his garage was lifted and slammed against a nearby building.

An information technology recruiter, Bisson said his income was so low he was rejected for an SBA loan.

He got a new homeowners insurance policy and successfully applied for Quick Start. "I feel fantastic," says Bisson. "It is going to allow me to repair my home."

Streitz said the letter to the state housing agency thanks it for the money it has so far given and also asks it to extend deadline for applying for Quick Start loans beyond Nov. 6. Haley said his agency has already indicated it is "very open" to the deadline extension.

Randy Furst • 612-673-4224