Iowa's Driftless Area Sees Housing, Economic Revitalization

Federal Reserve Bank of Chicago tour highlights successful rural development projects

Published on Mar. 11, 2026

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The Federal Reserve Bank of Chicago's Community Development Team recently organized a bus tour across Iowa's Driftless Area to showcase successful efforts in increasing housing construction and implementing economic development projects in rural communities. The tour highlighted how local leadership, strategic planning, and public-private partnerships have helped revitalize towns like Elkader, Waukon, Postville, Guttenberg, Maquoketa, Dyersville, and the larger city of Dubuque, despite demographic shifts and construction challenges.

Why it matters

The tour provided insights into how rural communities can address housing shortages and boost economic activity, even as they face population declines and aging populations. The examples demonstrate that with the right mix of local leadership, data-driven planning, and collaborative efforts, small towns can revitalize themselves and retain or attract new residents.

The details

The tour visited towns ranging from 1,200 to 6,100 residents, where local leaders, developers, and community partners have undertaken housing construction and economic development projects. These include the Tailwind Duplexes in Waukon, designed to appeal to aging residents who want to 'age in place', and mixed-use developments in Dyersville that have attracted a mix of year-round residents, snowbirds, and tourists. Challenges include construction worker shortages and navigating federal housing subsidy policies. However, strategic planning frameworks like the Community Heart & Soul initiative and the Rural Housing Readiness Assessment have helped communities identify local assets and needs to guide their revitalization efforts.

  • In October 2025, the Chicago Fed's Community Development Team organized the bus tour across Iowa's Driftless Area.
  • Between 2013 and 2023, Iowa's population declined in three of the six small cities visited on the tour, while the state's overall population grew by about 4%.

The players

Federal Reserve Bank of Chicago

The regional Federal Reserve bank that organized the bus tour to showcase successful rural development projects in Iowa's Driftless Area.

Ben Garrett

A Waukon native and developer who built the Tailwind Duplexes, a 16-unit development with single-story duplex buildings aimed at aging residents who want to 'age in place'.

Omar Padilla

An Iowa State University Extension and Outreach specialist who presented the Rural Housing Readiness Assessment (RHRA), a program that provides data, analysis, and a decision-making framework to help local leaders increase affordable housing availability.

Caleb Shea

One half of a husband-wife developer team in Elkader who renovated downtown buildings to provide new office space and upper-story rentals, using a mix of personal sweat equity and federal/state funds.

Community Foundation of Greater Dubuque

The organization behind the Community Heart & Soul initiative, a planning framework that focuses on identifying local assets and building consensus to direct future community development initiatives.

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What they’re saying

“'For an 80-year-old, moving 20 miles from Waukon to Decorah is like moving to a foreign country.'”

— Ben Garrett, Developer (pdccourier.com)

“'We imagine nurses, teachers, young people living here—people not yet ready to buy a home but interested in coming to our community.'”

— Caleb Shea, Developer (pdccourier.com)

“'strong housing options are the foundation of strong rural communities.'”

— Omar Padilla, Iowa State University Extension and Outreach (pdccourier.com)

What’s next

The Rural Housing Readiness Assessment program plans to work with six new Iowa cities in an upcoming cycle, providing them with data, analysis, and a roadmap to help local leaders move forward on housing development projects.

The takeaway

The successful housing and economic development projects highlighted on the tour demonstrate that with strategic planning, public-private collaboration, and committed local leadership, even small rural communities can revitalize themselves and attract new residents, proving that mission-driven, community-focused development can thrive in the Midwest.