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Follow MHP Connect for a variety of coverage on housing and community development news in Minnesota and across the nation.

Minnesota Housing Partnership (MHP) has received a crucial grant to assist rural and Native leaders in solving housing and community development issues in their communities. The U.S. Department of Housing and Urban Development’s Rural Capacity Building for Community Development and Affordable Housing Grant program (RCB) will provide $2.4 million to continue MHP’s important technical assistance and capacity-building work. 

The award will fund MHP’s Strengthening Rural Communities (SRC) program, which gives leaders the tools and knowledge they need to identify and address regional development needs through strategic collaboration. 

In rural and Native communities nationwide, there’s a significant gap between the supply of affordable housing and the number of people who need it, and a pressing need to address community development challenges. Providing resources and guidance to local and Tribal governments and other rural housing development organizations has proven an effective model of helping local communities address these needs.

“Minnesota Housing Partnership is ready to put this funding to work immediately in rural and tribal communities,” said Anne Mavity, MHP’s executive director. “We are thrilled that the Department of Housing and Urban Development has committed these funds to help our communities thrive.”

MHP has used past awards to provide technical assistance to rural communities in 17 states, including 20 Native nations. Past funding has resulted in hundreds of new and preserved units of affordable housing, and dozens of community and economic development projects in communities that need it most.

"MHP helped Lower Sioux’s Planning & Grants Department identify a new funder for an upcoming rental construction project. They then sat down with us to teach us how to complete the intensive 15-year feasibility projections and they reviewed our proposal draft," said Nora Murphy, Tribal Planner and Grant Writer for the Lower Sioux Indian Community. "In the end, we were awarded two grants to build 10 new rental homes at Lower Sioux. We simply couldn’t have done it without MHP’s guidance. Many, many thanks!"

Funds will be awarded to eligible entities through a Request for Technical Assistance process that will be announced in the next few weeks and that will be posted here.

A new report by MHP describes important affordable rural rental properties across Minnesota and the people who live there.  

In communities across Greater Minnesota, rural rental housing is at risk due to declining investment and failure to construct new housing affordable to community members. -- and MHP is working with partners and communities to save it (Learn more about our technical assistance here).  These are rental units that have been financed under the USDA’s Section 515 program. Under 515, nonprofit and for-profit entities have received 1 percent loans for acquisition, rehabilitation or construction of rental housing and related facilities. 

Many rural rental homes are aging and in poor condition. As federal investments in the 515 program have been insufficient and declining for many years, many 515 properties are in declining condition and there has been no new construction for years. 

As loans for these properties expire, more and more buildings are exiting the Section 515 program. Exiting properties may lose rental assistance funding, and some properties are no longer required to keep rents affordable — meaning residents could face displacement or homelessness. 

These properties are often the few rental homes in rural communities that are affordable to extremely low-income residents, seniors, and people with disabilities. The loss of these properties will be especially acute for communities already struggling to provide affordable homes. 

Part of the effort to save these properties is to quantify and describe these properties and who lives in them. MHP, in collaboration with the University of Minnesota’s Center for Urban and Regional Affairs, analyzed the most recently available data. The result is this report 

Among the findings:  

  • Minnesota has 456 properties under the 515 program providing 9,667 affordable rental units and housing 13,435 people.  
  • Average annual income for residents of these properties is $17,061.
  • These properties are found in 82 of Minnesota’s 87 counties but are concentrated in central and southern Minnesota.  
  • Significant age of the properties, indicating a need for regular maintenance and potentially poor conditions.
  • Households are more likely to be headed by women and are more likely to be BIPOC. 

 

MHP's Libby Murphy, Deputy Director of Policy, gives an overview of what we know about the state budget and how housing will be affected.

Minnesota Management and Budget released the official November revenue and spending forecast earlier this week, and it was a pleasant surprise. What had been a projected $2.42 billion deficit earlier this year is now a $641 million surplus for the upcoming biennium.

The November forecast in even-numbered years is critical starting point for the Minnesota Legislature. Governor Walz and lawmakers use the forecast to draft their two-year state budget proposals.

The surplus offers lawmakers an unexpected opportunity to help more individuals and businesses hurt by the second round of pandemic-related closures. While there is bipartisan support for some type of relief package in a December special session, it is unclear how much of the surplus lawmakers will agree to spend this December. A relief bill in December has broad support because Federal CARES Act dollars are largely already spent and any remaining money must be spent by the end of the calendar year.

Governor Walz and others have indicated that the surplus should be viewed as an opportunity to provide a 60-day bridge to struggling businesses and households until Congress passes a second relief package. While talks at the Federal level are accelerating, stalled talks in the fall led many to believe relief won’t come until February, after President Elect Biden takes office.

Even before the surplus announcement, Republican and DFL leaders released plans to provide financial help to businesses ordered to close and workers impacted by these closures. Walz acknowledged that the updated forecast will help accelerate discussions. Leaders on both sides of the aisle in both bodies acknowledged that the announcement provides assurances that the State has enough money in the short term to provide relief to those individuals and businesses that need it the most.

The surplus is a result of higher general fund revenues than predicted and lower spending than expected. It’s important to keep in mind that the May forecast was really a best guess estimate at the impacts COVID-19 would have on the State’s economy. While the budget outlook is also improved for the next biennium, MMB still projects a $1.273 billion deficit in the following (2022-2023). That deficit will influence lawmakers spending and revenue making decisions this year but, to what extent, remains to be seen.

Lawmakers are guaranteed to return to the Capitol, albeit mostly virtually, on December 14 for their sixth special session of the year. They are required to convene every 30 days to extend Governor Walz’ peacetime emergency. If lawmakers can agree to a relief package sooner, lawmakers will likely return sooner in order to get money quickly into the pockets of individuals and small businesses targeted through their relief efforts.

The recession’s unequal impacts

The higher than expected tax collections are attributed to the fact that the pandemic recession is hitting Minnesotans differently. Those in low-wage, service jobs most impacted by shutdowns are doing worse, especially after enhanced unemployment payments ended this summer. But many others experienced no decline or even increases to their incomes. For this reason, DFLers want to be laser focused on getting aide to lowest wage workers.

What this means for housing

Housing assistance is largely absent from the public conversations and proposals. The surplus announcement has the potential to broaden the range of direct economic supports to households in need and, potentially, housing providers.

MHP believes it is essential for the economic relief package to not only provide direct stimulus payments to households to help them pay their bills through the next few months; it must also include additional housing assistance dollars to help households catch up on past due housing payments. Debt as a direct or indirect consequence of COVID-19 and the pandemic recession is a financially crippling event that Minnesota lawmakers need to address. The Great Recession demonstrated what long-term consequences housing related debt has on low income households, especially Black, Indigenous and People of Color (BIPOC) households. And, when these households cannot fully participate in the economy, everyone suffers.

MHP joins Homes for All is calling on lawmakers to invest an additional $50 million in emergency housing assistance. Despite receiving nearly $700,000 in daily requests, Minnesota Housing will stop taking new applications after 11:59 p.m. on December 7 in order to process all payments. Households are still learning about the program and how to navigate the process. Additionally, the proposed stimulus amounts for direct payments may not be enough to help all households make their rent, mortgage, HOA, utility or other housing related expenses. MHP calculates that a low wage worker in the food prep or service industry could find themselves paying anywhere between 90-103 percent of their unemployment check on rent.

The second virtual Investors Council meeting of 2020 was held on Nov. 18 and featured a panel of journalists to answer the question: “What does the 2020 election mean for affordable housing?” 

But first, MHP honored seven housing advocates that made a big difference in 2020. 

“We succeed in our advocacy work because of the outstanding efforts of people like you,” said MHP’s executive director Anne Mavity. 

Those honored on Wednesday include: D’Angelos Svenkenson, Founder & CEO, NEOO

Partners Inc.; Jenny Larson of Three Rivers Community Action; Nelima Sitati Munene of ACER; Asad Aliweyd of New American Development Center; Chad Adams of Southwest Minnesota Housing Partnership; and the Swift County Collaborative. You can read more about these Outstanding Advocates at the MHP Connect blog

In her remarks, Minnesota Housing Commissioner Jennifer Ho praised those advocates -- and all advocates fighting for housing and shelter. 

“Advocacy matters. And with legislative sessions during COVID, it matters even more because we can’t pack the capital or the offices.”

She added, “If there’s one takeaway from my remarks today... I just want to say that advocacy really, really matters. So thank you again to the advocates and to MHP, and Minnesota Coalition for the Homeless, and Homes for All.”

She noted that support and momentum are crucial in this moment when so many people need assistance -- including the $100 million in housing assistance that Minnesota Housing is administering and counties are implementing.  

“We need your help supporting the local grant administrators who have seen an overwhelming asks for assistance. The need has not gone away just because the federal support has gone away.”

A panel discussion about the 2021 legislative session’s potential impacts on housing included C Terrance Anderson, Director of Community Programs at CURA; Peter Callaghan from Minnpost, and Briana Bierschbach from the Star Tribune. 

“The needs around housing are great,” Anderson said. “We are seeing an intensified reality around housing. Gentrification, disinvestment in communities, and redlining really shaped what is happening today and these are vital to understanding what is happening in Twin Cities.”

Anderson noted that Minnesota is in store for a huge surge in evictions. “We have this moratorium for folks not to be evicted but as soon as that ends, we are in for a tidal wave of evictions.” 

He said policy solutions can help alleviate that including extending the evictions filing timeline and enacting financial assistance. “Renters need more time to reconcile with landlords and a lot more help from the feds and state.”

On how lawmakers and decision-makers view racial disparities in housing, Anderson said, “I think everybody's politics should have changed post-George Floyd,” he said. “The priorities are quite clear about BIPOC communities: Employment, education, and housing. The opportunities are there and the ideas are there but will they be prioritized?”

Peter Callaghan of Minnpost noted that some bonding could happen. “Is there appetite for another bonding bill? They've always done a smaller bonding bill in the odd year -- the first year of the legislative. And they would have last time if they were so tied up in partisan disputes.” 

He added, “Housing has not been a controversial vote on bonding. If there’s a bonding bill I would anticipate there would be housing money in it.”

But, he said, it could get complicated. “Republicans have pushed for the addition of housing regulatory reform to any additional bonding money. I think that will happen again.” 

Briana Bierschbach from the Star Tribune noted that the upcoming session will be tough. 

“These people find ways to disagree even on things they agree on.”

She agreed that political realities changed after the George Floyd uprisings and that there’s a broader consensus among Republicans -- especially Paul Gazelka who met with families who lost loved ones to police brutality. 

In addition, she said, “The pandemic has hit people that are vulnerable the hardest and taken all these issues in our society and made them visible for everyone.”

But, most issues will be a tough sell in 2021. “When things are really hard, legislators tend to get done only what they have to get done. There will be so many battles just to respond to the pandemic, just to get a budget passed. A lot of issues probably won’t get attention.” 

The conversation was much deeper, insightful, and complex than can be captured in this blog so be sure to watch it here: 

To be part of these dynamic conversations, become a contributor or renew your contribution in the MHP Investors Council today!