The May meeting of the Minnesota Housing board covered outcomes from the 2014 legislative session, most importantly the $100 million in bonding for housing passed by the Minnesota Legislature. In addition, the board listened to a presentation on key housing trends, as well as a report on comments received about the upcoming 2015 Affordable Housing Plan, which serves as the annual business or work plan for the Agency.
2014 Legislative Session: Bonding and Other Outcomes
Commissioner Tingerthal opened the meeting proclaiming that the passage of the bonding bill with its $100 million for affordable housing was the headline for her report. She noted that this was twice the amount proposed by the governor. Tingerthal said that the scope and scale of the grassroots efforts supporting bonding were astounding. There was an amazing sense of accomplishment in the community that believes affordable housing is important, she added.
Regarding the distribution of the new bonding dollars, Tingerthal said that this year the Agency will make available up to the entire $80 million awarded for infrastructure bonding, depending on the quality of applications received. She said there are at least a dozen supportive housing proposals being submitted, as well as a number of preservation deals. With interest rates as low as they are, the Agency should be investing as long as there are good proposals, she added. However, the Commissioner said that Agency staff were still deciding whether to release all public housing funding at one time. May 29 was announced as the official recognition of the bonding commitment at the groundbreaking for the Fort Snelling veterans' supportive housing building. Senator Franken planned to attend and a funding announcement was to be made by United Health Group.
In a later staff report on the legislative session outcomes, Tonja Orr and Katie Topinka provided additional details. In the supplemental budget passed by the legislature, the Agency received $2.2 million for student housing. Orr added that this was not a business that the Agency wanted to get into, but the Agency was the best vehicle for getting appropriated funds to projects in areas with "low vacancy rates and education and training centers for jobs in the natural resources or aviation fields." In addition, $500,000 of existing Challenge program funds are to go to creating homeownership opportunities for families with children with disabilities who are facing eviction because of the kids' disabilities. $250,000 was awarded to the Agency for five housing needs assessments for veterans in communities across the state. And the Department of Human Services was awarded increases of $1 million for the Homeless Youth Act, and $500,000 for the Safe Harbor initiative.
To facilitate higher density, transit-oriented development, in the tax bill the Dakota County CDA was granted authority to issue tax credits of any unit size composition for up to three developments along the Cedar Avenue Bus Rapid Transit Line. In another section of the tax bill, $2 million was appropriated to DEED for development of market rate (work force) housing in Roseau and Pennington Counties.
Turning to planning, John Patterson, Director of Planning, Analysis & Evaluation, gave a housing trend report along with a summary of comments received by the Agency concerning the upcoming 2015 Affordable Housing Plan (AHP). For trends facing the Agency, John Patterson noted an increased need for affordable housing and a critical need to preserve subsidized housing. He noted that 40,000 Section 8 and USDA units built in the 1970's and 80's are in need of restoration. Patterson added that homeownership has been declining, while rental has been increasing since the financial crisis. In addition, the senior population is expected to double by 2030.
Comments on 2014 Affordable Housing Plan
Patterson added that the Agency received comments from 13 organziations on the upcoming 2015 Affordable Housing Plan, which lays out the Agency's priorities and program initiatives for the coming year. He said that these comments illustrate that all of the Agency's programs are priorities, so finding the right funding balance among the programs is critical. Commissioner Tingerthal said that from her review of the comments, the Plan is not missing any major areas of need. Chair Ken Johnson made note of the housing authorities' interest in more funding for senior housing. Staff said that they would take the comments into account in preparing the final AHP to be recommended for passage by the Board at its September meeting.