HomeMy WebLinkAbout2021 02-01 CCPCouncil Worksession
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February 1, 2021
AGE NDA
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of the full C ity Council pac ket is available to the public at http://c ityofbrooklyncenter.org/.
1.C all to Order - 6:30 p.m.
2.M iscellaneous
a.Housing Study D iscussion
3.Adjourn
C ouncil Worksession
DAT E:2 /1/2 0 2 1
TO :C ity Council
F R O M:C ur t Boganey, C ity M anager
T H R O U G H :N/A
BY:M eg B eekman, Community D ev elopment D irector
S U B J E C T:H ous ing S tudy D is cus s ion
B ackground:
At the March 2 0 2 0 w ork s ession, the C ity C ouncil pr ovided direc-on on a hous ing policy work plan and
directed staff to explor e the crea-on of a N O A H P r es erv a-on program. At that s ame mee-ng, the C ity
Council indicated an interes t in learning more about mixed-income/inclus ionary hous ing policies and the
impact s uch a policy might have financially for the C ity. O n January 25, 2021, s taff prov ided a pres enta-on
at the Council’s w ork s es s ion which detailed both topics. S taff has prepar ed a dra8 N O A H P reserva-on
program for the C ity Council’s considera-on and dir ec-on, and provided analys is on the components and
impact of mixed-income/inclus ionary housing policies . The dis cus s ion this evening will provide an
opportunity for follow -up and for the C ouncil to offer further direc-on on a N O A H P r eserv a-on P rogram
and M ixed-I ncome Policy. T he work ses s ion w ill be an opportunity to explor e the dra8 N O A H P reserva-on
P rogram, hear w hat addi-onal ques -ons the C ouncil may have and under s tand what addi-onal analys is
and informa-on the C ouncil might need to make a decis ion about such a pr ogr am. I f -me allow s , similar
dis cus s ion and explor a-on can occur in regar ds to a mixed-income/inclus ionary policy.
O vervie w
H ousing and the policy is s ues related to hous ing have become some of the mos t pres s ing and important
ma;ers facing communi-es today. For mos t s ubur ban communi-es, hous ing compr is es a s ignificant
majority of a ci-es land us e and tax bas e. M aintaining and pres erving a safe, quality, and desirable hous ing
s tock is cri-cal to a community's long term economic health and resiliency. F urther, a div ers e housing s tock
w hich offers a w ide range of hous ing choices and price points ensures that a community can be resilient
through economic ups and dow ns as well as prov ide housing op-ons for a divers e popula-on throughout
their lives . I n addi-on to maintaining a quality and diverse s upply of hous ing, communi-es are more and
more becoming focus ed on concerns regarding liv ability and accessibility of hous ing.
T he Tw in Ci-es M etropolitan A rea is currently experience record low vacancy r ates . A ccording to
Marque;e A dvis or s ’ midyear report from A ugus t 2019, the average vacancy r ate acr os s the seven-county
metro area is 2 .3 percent. Experts agree that a balanced rental market will typically s ee an av erage vacancy
rate of around 5 per cent. T he effect of low v acancy r ates over -me is incr eas ing r ents , a growing interes t
from outs ide inves tors , and landlords in a pos i-on to be choosier about w ho they r ent to.
Br ookly n C enter ’s C urr ent Rental H ousing
T he result of the r egional trends des cribed above ar e being felt in Brooklyn C enter. Vacancy rates in the
community remain low er than the regional average, hov ering around 2 per cent. T his is common in
communi-es w ith more affordable rental units .
T hirty-s even per cent of Brooklyn C enter's hous ing s tock is compris ed of rental units . O f the C ity ’s s ingle-
family housing, about 8 percent are rental. Near ly 100 percent of the mul--family housing in Brooklyn
Center are one and tw o bedroom units built between 1961 and 1971, and near ly all of it is naturally
occurring affordable hous ing (N O A H ). Aver age r ents in Brooklyn C enter ar e naturally occurring affordable
becaus e the mar ket r ents , based on the age and condi-on of the units make them affordable at around 50
percent A M I in the metr opolitan area. Rents in Br ookly n Center are lower than the regional av erage.
A pproximately 9 0 per cent of all of the hous ing units in Brooklyn C enter is N O A H .
W hile N O A H proper-es are affordable, they can be at risk of being los t as market demand increas es and
rents con-nue to go up. They can also experience dis inv estment over -me, caus ing deteriora-on, los s of
value, and mos t importantly poor quality or uns afe living s itua-ons if they are not properly ins pected and
maintained. At pr es ent 4 .1 percent of all units ar e legally binding, or s ubs idized affordable units. 10.9
percent of rental units are legally binding affordable. S ubs idiz ed affordable units are hous ing units that are
required to maintain an affordable rent regar dles s of s hi8s in market demand. D ue to their financing
s tructure, they als o mus t be maintained to a cer tain minimum s tandard. O ne of the goals of affordable
hous ing advocates is to pres erve exis-ng N O A H proper-es by conver-ng them to legally binding affordable
units through N O A H pr es erv a-on programs . W ith the cons truc-on of S onder H ous ing, Real Es tate Equi-es
w ill be adding 2 7 0 units of legally binding new affor dable hous ing units to the city. T hese w ill be the firs t
new construc-on mul--family housing units built in B rooklyn C enter since 1971, and will increas e the
percentage of legally binding affordable units to 6 .6 percent of all units and 17.1 per cent of rental units .
T he C ity's 2040 C ompr ehensive P lan iden fies sever al broad housing goals
2 040 H ousing & Neighbor hood G oals :
P romote a divers e hous ing stock that prov ides s afe, s table, and acces s ible hous ing op-ons to all of
Brooklyn C enter ’s res idents.
Recogniz e and iden-fy w ays to match B rook lyn C enter ’s hous ing w ith the C ity ’s changing
demographics .
Explore oppor tuni-es to improve the C ity ’s hous ing policies and or dinances to make them more
res pons iv e to cur rent and future residents .
Maintain the exis -ng hous ing stock in pr imarily s ingle-family neighborhoods thr ough proper
ordinances , incen-v e programs and enfor cement.
Explore oppor tuni-es to incorporate new affordable housing into r edevelopment areas that promote
s afe, secur e and economically diverse neighbor hoods .
I n addi-on to thes e goals , the 2040 Compr ehens ive P lan iden-fies implementa-on s trategies as w ell as
res ources and tools for achiev ing its housing goals . T hese are contained in C hapter s 4 and 9, of the H ous ing
and I mplementa-on chapters res pec-vely (a;ached).
B ackground
I n A pril 2018, the C ity C ouncil dis cus s ed sev er al pos s ible policies to addr es s affor dable hous ing issues . T he
memo from that dis cus s ion is a;ached to this r epor t. Based on that discus s ion, C ouncil directed staff to
mov e forw ard w ith a Tenant P rotec-on O rdinance, and in D ecember 2018, it w as adopted.
I n M arch 2020, T he C ity C ouncil dis cus s ed hous ing policy as it centers around two dis-nct topic areas :
1 ) H ousing choice - W hat is the composi-on and condi-on of the current hous ing s tock? W hat are the
current market demands for hous ing? H ow does the city's housing s tock relate to the market, and does the
city have enough and the r ight ty pe to meet cur rent and future need?
2 ) A ffordable hous ing policies - W hat can the city do to improve livability and acces s ibility to quality
affordable hous ing for res idents? W hat bes t pr ac-ces exis t to s upport an effec-v e approach to addres s ing
the need for affor dable hous ing in the community ? W hat policies are mos t effec-ve to prevent
dis placement?
At the w ork s es s ion the C ouncil cons idered a w or k plan that would take a comprehensiv e rev iew of the
City ’s housing policy appr oach related to thes e tw o dis -nct topic areas and pr ovided direc-on to staff. T he
s taff report from that mee-ng is a;ached.
At that mee-ng, the C ity Council expres s ed s upport to explore a N O A H pres er va-on program and a mixed-
income hous ing policy (or inclus ionary hous ing policy ) as part of the City ’s s trategy to create stable, quality
hous ing for all incomes in the community. The purpos e of this dis cus s ion is to pr ovide informa-on on thes e
tw o policy programs to the Council and get dir ec-on on how to proceed.
M ixe d-I ncome H ousing Policy
A Mixed-I ncome H ous ing Policy, als o know n as inclus ionary hous ing requires a s et as ide of a certain
percentage of units or fee per unit for affordable hous ing w hen new mul--family hous ing is developed.
Mixed-income policies prov ide developers w ith clear and consistent expecta-ons of development in the
community. A M ixed-I ncome H ous ing Policy pr ovides for a value exchange between the local developer and
the community, pr oviding affordable housing for res idents while the developer r eceives a new project in
their porKolio; however they are not implemented w ithout cos t.
Key components of the Mixed-I ncome H ous ing Policy include:
A pplicability – The policy iden-fies w hen it w ill apply. D ifferent ci-es hav e different standards as to
w hen this trigger point occurs . Brookly n Par k’s policy for example applies to all developments that
add or cr eate ten or more res iden-al rental units and that receive:
- City or E DA financial as s istance
- Mas ter or amended P U D (would require a change of city ordinance)
- Zoning Code A mendments (would require a change of city ordinance);
- O r C omprehens iv e P lan A mendments
A ffordability requireme nts – The Policy s tates what the affordability r equir ements are. S ome mixed
income policies hav e op-ons w hich allow dev elopers to choose how many units , bas ed on the
affordability. P r oviding op-ons allow s flexibility within a project. Below is an example of w hat that
could look like. S ome mixed-income policies als o allow dev elopers to pay a fee to the city instead of
providing units w ithin their developments . F unds paid to the city are then us ed to create affordable
hous ing els ew her e, either by funding a N O A H pr eserv a-on program or funding the construc-on of
new affordable units in other loca-ons . Edina’s mixed-income policy is an example of one that
provides this op-on.
O p$ons
(choose one)M in. N umber of Units Required A ffordability S tandard
5%A ffordable for H H at 30 % A M I
10%A ffordable for H H at 50 % A M I
15%A ffordable for H H at 60 % A M I
A ffordability pe riod – The policy states how long the affordability is required for. 1 5 -20 years is fairly
common in thes e ty pes of policies .
D istribu$on of affordable units – The policy w ould typically state that the affordable housing units
s hould be cons is tent to the market rate units in quality of cons truc-on and finis h, with units
intermixed within the s ame development.
N on-di s cr i mi na$on – The policy w ould typically s tate that developments covered by this
Policy mus t not dis criminate agains t tenants w ho pay rent w ith federal, state, or local public
assistance, including, but not limited to rental as s is tance, rent s upplements, and H ousing Choice
Voucher s .
O ther conside ra$ons - M ixed income policies can als o include other ty pes of incen-v es to
encourage or as s is t the dev eloper w ith s upplying the affordable hous ing. For example, one of the
most expens e as pects of construc-on that adds cos t to proj ects, and thus driv es up rent, is
enclosed or underground par king. Reduced park ing requirements can have a s ignificant effect on
cons truc-on cos ts . T he Council could cons ider including parking s tall r educ-ons as an addi-onal
incen-v e to pr oviding mixed-income units .
F inancial I mplica ons
I n Brooklyn C enter, generally speaking mul--family r es iden-al development does not generate high enough
rents to cover the cos t of construc-on. Therefore, any new mul--family dev elopment would v ery likely
require s ome for m of gap financing in order to be feas ible. T here are differ ent ways that dev elopers can fill
financial gaps :
Federal low -income hous ing tax credits (L I H TC )
S tate and/or C ounty grant sources
S tate loan/mortgage programs
L ocal Tax I ncr ement F inancing
L ocal Tax A batement
L ocal fee w aivers
L and us e/zoning concessions
S ome of thes e s our ces r equire v arious forms of affor dability and others do not. C ity r equired affordability
requirements incr eas e financial gaps, w hich mus t be filled by local s ources . I n other words , applying a
mixed income hous ing policy will increas e the need for city subsidy and may make s ome proj ects financially
infeas ible altogether. I n addi-on, the C ouncil may need to balance using T I F funds to achieve mixed income
affordability goals vers us achiev ing other community benefits that are des ir ed as par t of the project.
Ehlers analyz ed the cos t per unit to cons truct new affor dable units based on their affordability level and the
length of -me the affor dability w ould be required. This cost represents the likely gap to the project created
w ith the inclus ion of thos e units. Below is a table repres en-ng the res ults of their analy s is .
C ompliance
S imilar to a development agreement, affordability requirements for the development w ould be outlined in
an A ffordable H ous ing Per formance A greement s igned by the C ity and developer. The Performance
A greement w ould include the loca-on and number of affordable housing units , rental terms and occupancy
requirements , -metable for compliance, affor dability res tric-ons and any other ter ms the City requires . To
ensure compliance with the Performance A greement, the C ity would require the pr operty
ow ners /manager s to conduct annual income cer-fica-ons for households liv ing in affordable units w hich
w ould be review ed by City s taff ev ery three y ears . T he income qualifica-on pr oces s would follow the
H ousing and U r ban D ev elopment (H U D ) income cer-fica-on proces s . S taff w ould monitor compliance and
the C ity could char ge the property owner a fee to cov er s taff expens es related to monitoring. This w ould
likely become par t of the r ental licensing proces s , but is not currently a func-on of the program. I t would
require addi-onal enfor cement and addi-onal res ources to carry out.
W hat are other C i es in the region doing to pr omote mixed-income or inclusionar y housing?
T he policies and prac-ces to promote mixed-income and affordable hous ing vary from city to city. A
number of other ci-es in the region have adopted mixed-income hous ing policies or us e them in prac-ce.
Brooklyn Park adopted a mixed-income policy in 2018, w hich w as largely bas ed on policies adopted by the
City of S t. L ouis Park and the City of G olden Valley. C i-es w ith known mixed-income polices or prac-ces are
lis ted below :
S t. L ouis Park
Edina
G olden Valley
Minneapolis
S t. Paul
Eden P rairie
Chas ka
Next S teps
S taff w ill move forward bas ed on the direc-on prov ided by the C ity C ouncil this evening. I f the Council
choos es to mov e for w ar d w ith adop-ng a mixed-income policy the next s teps w ould be:
D ra8ing a mixed-income policy and br inging it back to City Council for cons idera-on
I mplemen-ng the policy
N OA H P rese rva$on P rogram
A s the C ity has done engagement for the 20 4 0 C omprehensiv e P lan and the O pportunity S ite, many
dis cus s ions have occurr ed with renters around the community related to hous ing. O ne theme from thes e
dis cus s ions has been a concern that the C ity ’s focus is too much on new cons truc-on of affordable hous ing
in the future on the O ppor tunity S ite, and not enough on improv ing the exper iences and cost of living of
exis-ng renter s today.
I n fact, preser ving exis -ng affordable hous ing can be much more efficient and cos t effec-v e than building
new affordable hous ing. M any ci-es are dev eloping N O A H pres erva-on programs with that goal in mind. A
pres erva-on program can be set up in various w ay s , but es s en-ally how they wor k is to incen-viz e exis -ng
N O A H proper ty owners into seTng as ide a percentage of rental units as legally binding affordable units for
a set period of -me.
T he S tate of M innes ota pr ovides a property tax br eak for s ubs idiz ed rental pr oper -es under the L ow
I ncome Rental C las s ifica-on P rogram (L I R C ), commonly referred to as the "4 d" program. 4d is one of
S ev eral tax clas s ifica-ons the S tate of M innes ota applies to rental proper ty. C las s 4d property is taxed at a
class rate of 0.7 5 %, approximately 40% les s than other classifica-ons. Non-s ubs idiz ed proper-es are
eligible for the 4 d tax clas s ifica-on w hen a pr oper ty meets tw o condi-ons :
1. The property owner agrees to rent and income r estric-ons s er ving hous eholds at 6 0% of the A M I or
below.
2. The property receives financial as s istance from feder al, s tate or local government requiring r ent and
income r es tr ic-ons. At least 2 0 % of the units mus t meet the income requirements . The 4d tax s tatus
applies only to the rent/income-qualifying units . T he applica-on deadline to Minnes ota H ousing is
March 3 1 of each year for taxes payable the following year.
I n order to do this , the C ity would create a N O A H pr es erv a-on fund. I t is es -mated that the T I F 3 H ous ing
F und w ill have a balance w hen T I F 3 decer-fies at the end of 2021. These funds could be us ed to seed a
N O A H pres erv a-on fund. S taff would work w ith exis -ng rental property ow ners to provide a modest
s ubs idy for building rehabilita-on or capital improv ements, w hich w ould then be combined with a 4 D tax
classifica-on benefit to prov ide a property tax break , currently amoun-ng to 4 0 %. I n exchange, the
property ow ner w ould agr ee to s et as ide cer tain units as affordable for a s et period of -me. The res ult is the
pres erva-on of N O A H units through a legally binding contract. S taff has dra8 ed a proposed N O A H
P reserva-on P rogram which is a;ached to this r epor t for discussion purpos es .
S avings to Rental P roperty Owners (C ost to Other Taxpayers)
Non-4d apartments have a tax class rate of 1.2 5 %. U nits classified as 4d hav e a tax clas s rate of 0.75% (for
the firs t -er). A bill that w ould reduce the clas s rate for affordable rental hous ing from 0 .75% to 0.25% w as
introduced at the L egis lature this year. W hile it didn't pass this ses s ion, it could be r eintroduced in future
s essions. This w ould incr eas e the s avings per unit that a landlord could achiev e, increasing the incen-ve to
Brooklyn Center 2020 C er-fica-on of M N L ow-I ncome Rental Clas s ifica-on
A ddres s Total
U nits
Q ualify
Per cent P roperty Name
6130, 6138 B S 6200 F r ance Av e
N 23 1 0 0 %Ew ing S quar e Townhouses
7256 Unity Ave N 112 1 0 0 %U nity P lace
6121 Brook lyn B lvd 158 1 0 0 %The S anctuar y at Br ookly n
C enter
6915 H umboldt Ave N 50 1 0 0 %Lynw ood Pointe
6920 & 691 0 H umboldt Av e N ,
1302 & 130 8 6 9 th Av e N 128 1 0 0 %C arrington D riv e
Total:471
par-cipate in the pr ogr am, als o increasing the impact on a city ’s tax base.
Example O ne:
50-unit building valued at $4,627,000
Non-4d property taxes es-mate $4,627,0 0 0 x 0 .0125 = $57,837.50
4d proper ty taxes (all units ): $4,627,0 0 0 x .0075 = $3 4 ,702.50
S avings $23,1 3 5 ($4 6 2 /unit)
Example Tw o:
50-unit building valued at $4,627,000
Non-4d property taxes es-mate: $4,6 2 7 ,000 x0.0 1 2 5 = $57,927.5 0
4d proper ty taxes (all units ): $3,453,0 0 0 x .0025 = $1 1 ,567
S avings $46,3 6 0 ($9 2 7 .21/unit)
A nother w ay to analy z e the affect of a N O A H P res er va-on program is on ov er all tax base. O ne example to
illus trate this is if the C ity were to have a goal of eventually including 20 per cent of its rental units in the
pres erva-on program. T his w ould equate to 8 6 8 units . At pres ent there are 4 7 1 units already included in
the 4d program w ith another 2 70 under cons tr uc-on. T his w ould mean focus ing on adding an addi-onal
1 27 units into the program. A s s uming the tax r ate reduc-on remains at 40 percent, the av erage unit w ill s ee
a tax s avings of $6 0 0 per year. This would w ork out to be an annual proper ty tax reduc-on from thes e
mul--family units of $7 6 ,200.
I n addi-on to the annual property tax reduc-on, the program would include a one--me upfront incen-ve in
the form of a matching gr ant that property ow ners would use for common capital improvements to the
building. Minneapolis prov ides v ery li;le incen-v e. S t. L ouis Park provides more. For Brooklyn C enter, S taff
w ould propos e a matching grant up to $1,0 0 0 per unit not to exceed $25 ,000 per pr operty to encourage
common area improv ements and energy impr ovements to buildings. This w ould encourage par-cipa-on as
w ell as improv ements to proper-es that would benefit all renters in the building.
C ur rent 4d P roper es in the C ity
4 d P r ograms in other C i es
Minneapolis, S t. Paul, S t. L ouis Park, Brook lyn Park and Edina have approv ed 4d pr ograms . A ll programs
are modeled a8 er the pr ogram dev eloped by the C ity of M inneapolis . The pr ogr ams offer a modes t-siz ed
grant and 4d pr oper ty tax s tatus in exchange for pr es erv ing affordability. B rook lyn Park's program is als o
paired with av ailable financing to encourage nonpr ofit buyers to purchas e N O A H pr oper-es to pres erv e
them. I t w as through this program that they as s is ted the acquisi-on of H un-ngton P lace by A eon.
I ncome
L imits
B e ne fit s Time
L imit
B uilding
S ize
O t he r
M inneapolis 20% of the
units at
60%
A M I
$1 50
applica-on fee
G rant of
$1 00/unit
Max
grant=$1,000
10 y ears 2 +Energy as s es s ment and
improvements encouraged
Ren-ncreas es for exis -ng
tenants <6% annually
S t Paul 20% at 6 0 %
A M I
(pr eference
to 50%)
$1 50
applica-on fee
G rant of
$1 00/unit
Max grant=
$1 ,000
10 y ears 2 +Rent incr eas es for exis-ng
tenants < 3% annually
S t L ouis
Park
20% at 6 0 %
A M I
$1 50
applica-on fee
G rant of
$2 00/unit
Max
grant=$6,000
10 y ears 3 +Ren-ncreas es for exis -ng
tenants <5% annually
Energy as s es s ment required
Energy impr ovements
encour aged
Edina 20% at 6 0 %
A M I
G rant of
$1 00/unit
Max G rant for
Energy
improvements
$3 0,000
1 5 year s 4+Rent incr eas es for exis-ng
tenants < 6% annually
Energy A s s es s ment and
I mprov ements Encouraged
A rea Median I ncome Rent L imits - 2020
---- Maximum G ros s Rents by Bedroom S ize (4/1 /2020)
0 1 2 3 4
50%A M I 905 970 11 6 3 1344 1 5 0 0
60%A M I 1086 1 1 6 4 13 9 6 1613 1 8 0 0
70%A M I 1267 1 3 5 8 16 2 9 1882 2 1 0 0
Because rents in B rook lyn C enter are naturally more affordable, this progr am has the opportunity to be
effec-ve to lock in a percentage of units at 50-60 percent A M I now, befor e r ents incr eas e to the point of
being unaffor dable. Thus prev en-ng displacement befor e it occurs . F urther, becaus e landlords would not
need to neces s arily reduce rents to par-cipate in the program, the barrier of entry is low, making it mor e
likely to be succes s ful.
Key C omponents of a N O A H P r eser va on P r ogram
A pplicability - D ifferent programs include eligibility for different s iz ed buildings . To begin the program
s taff w ould r ecommend focus ing on proper-es with fiv e units or more.
A ffordability - Mos t ci-es follow the s tate mandated 60 percent A M I affor dability. Because rents in
Brooklyn C enter are on av erage more affor dable, staff would recommend s tar-ng the program w ith
the goal of achieving rents affordable at 50 percent A M I . I f the C ity finds it too difficult to en-ce
proper ty owners to par-cipate at the low er affor dability, the program could be review ed.
A ffordability Pe riod - Most ci-es' programs pr ovide an affordability r equir ement of 10-15 years .
Eligibility - T he policy w ould include eligibility in terms of w hich pr oper -es could apply for the
program. S taff would recommend allow ing Type I and I I rental licens e proper-es only to apply, as
these pr oper -es hav e demonstrated they are w ell maintained and are not experiencing deferred
maintenance is s ues .
Next S teps
S taff has begun dra8 ing a N O A H P reserva-on pr ogr am w hich is a;ached for dis cus s ion purpos es this
ev ening. Based on the dis cus s ion this evening s taff will make changes to the pr ogr am and bring it back to
Council for cons idera-on.
S taff has begun reaching out to local landlor ds to dis cus s the program and get feedback on the propos ed
parameters, as w ell as s olicit interest if a pr ogr am w er e to be establis hed. The res ults of this efforts will be
compiled and s har ed with C ity C ouncil along w ith any changes to the program at a future mee-ng.
B udget I ssues:
Policy Q ues -ons :
N O A H P reser va-on P rogram D is cus s ion
1. D oes the C ity C ouncil want to move forw ard with a N O A H P reserva-on pr ogr am?
2. W hat addi-onal analy s is or informa-on does the Council need to make a decis ion?
3. W hat cons ider a-ons or concerns does the C ouncil have about the dr a8 pr ogr am prepared by S taff?
1. W hat dura-on should be cons idered in ter ms of affordability?
4. W hat s hould be the goals of the program in terms of percentage of r ental units to include in the
program?
5. W hat affordability level s hould be achieved through the program, and what incen-ves is the C ouncil
comfortable pr oving in order to achieve s uch a goal?
S trate gic Priori$es and Values:
Resident Economic S tability
AT TA C H M E N TS :
D escrip-on Upload D ate Ty pe
H ous ing I ncen-v es 1/27/2021 Backup M aterial
A genda I tem 8 _3 1/27/2021 Backup M aterial
04-09-18_C C _ W S _ A ffordable H ous ing 1/27/2021 Backup M aterial
L I R C G uide 1/27/2021 Backup M aterial
04_H ousing-C hapter-3 -1 5 -2 0 19 1/27/2021 Backup M aterial
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Brooklyn Center 4d affordable housing incentive program
Due to recent housing, economic and demographic trends, Brooklyn Center is experiencing an
affordable housing need. Already burdened low- and moderate-income tenants are increasingly paying
more than 30 percent of their income on rent and utilities. At the same time, many rental property
owners are faced with increased operating and maintenance costs, as well as market opportunities to
increase rents.
In response, the city is offering incentives for rental property owners to reduce property tax liability,
improve energy efficiency and address conditions of aging buildings, if present. The goal is to preserve
affordability, reduce energy use and enhance healthy homes to support tenants and strengthen the
bottom line for property owners.
Benefits to property owners
Qualified market rate building owners that agree to keep a minimum of 20 percent of units per building
affordable to households making 50 percent of area median income (AMI) for XX years will receive:
• XX-year eligibility for 4d property tax rate, which provides a 40 percent tax rate reduction
on qualifying units.*
• City pays the first year fee for the Minnesota Low Income Rental Classification (LIRC) application,
also known as 4d tax classification ($10 per unit)
• Up to $1,000 matching grant per affordable unit, capped at $25,000 per property to be spent on
common improvements
• Free energy efficiency and healthy homes assessments available to buildings with five or more
units.
• Utility rebates for energy efficiency and healthy homes improvement identified in the free
assessment
• Reduced renter turnover
• Lower maintenance and operating costs, if owners take advantage of opportunities to make
energy efficiency improvements to properties
*Minnesota Statute 273.128 provides that qualifying low-income rental properties, including those
enrolled in the Brooklyn Center 4d incentive program, are eligible for 4d tax classification. According
to state statue, the first tier of valuation ($150,000 per unit in 2020) on 4d rental properties is taxed
at a rate 40 percent less than 4a and 4b rental property. The actual reduction in property taxes may
be slightly higher or lower than 40 percent.
Eligibility guidelines
Owners of market-rate multifamily properties that meet the following criteria:
• At least 20 percent of rental units in a building are affordable to households whose family
income is at or below 50 percent of the area median income (AMI).
• Existing tenants in units that have program-compliant rents do not need to be income qualified.
• Income qualification for tenants is determined upon initial occupancy. Increased income of
tenants in affordable units will not violate program requirements.
• Buildings that have at least five rental units; licensed rental properties with license types I or II
that are in good standing with no active code compliance violations.
• Buildings can include units with owner occupants, but only rental units are eligible for 4d tax
status.
The city will receive and review applications on an annual basis. The city expects to accept applications
January through late February. Properties will be selected based on city goals of preserving housing
affordability in neighborhoods throughout the city, subject to the availability of city grant funds.
Note: The city reserves the right to deny applications for the 4d incentive program if the owner or
property manager applying owns or manages other properties with outstanding code compliance issues.
Process and program requirements
Step 1 (required)
• Property owners submit a 4d program application and rent roll and sign a participation agreement
with the city. The participation agreement includes a commitment to accept tenant-based
assistance and affirmative fair marketing, and prohibits involuntary displacement of existing tenants.
• The city will draft and record a declaration against the property that limits the rents and
incomes on the qualified units for XX years (a recorded document is required for 4d tax
classification status). The declaration also limits rent increases to no more than once in a 12-
month period, unless the unit is turning over to a new tenant.
• The city will provide a matching grant to each 4d property in the amount of up to $1,000 per
affordable unit, capped at $25,000 per property. This funding is intended to help property
owners common area capital and health, safety and energy efficiency improvements to
properties. Owners must certify to the use of the funds for the property.
• Property owners will select the percentage of their building units to restrict, with a minimum of
20 percent.
• Property owners will sign a 4d application once declaration is filed.
• The city will submit a signed 4d application, application fee and declaration to Minnesota
Housing on behalf of the property owner for their first year only. Owners are responsible for
submitting annual applications to Minnesota Housing to renew 4d tax status. See “Annual
Owner Compliance” for additional information.
Step 2 (required)
• Owners of 5 or more unit buildings can sign up for the Multifamily Building Efficiency Program
through Xcel Energy and CenterPoint Energy, and complete a free energy assessment by Energy
Insight Inc., to receive an energy report of recommended improvements.
Benefits to owners:
• A free energy assessment, including free direct install of low-cost improvements such as LED
lights and faucet aerators.
• Qualification to receive rebates for energy efficiency project expenditures if improvements
result in at least 15 percent energy savings.
Step 3 (encouraged)
Following a free energy assessment, meet with the city and Center for Energy and Environment (CEE) to
discuss energy efficiency improvements and available rebate packages. Property owners can choose
from a variety of energy efficiency, weatherization or healthy homes improvements and may qualify for
utility company subsidies and rebates that can cover between 25 percent and 90 percent of costs.
Benefit to owners:
• Public recognition for your partnership with the city
• Financial assistance to help cover the cost of energy efficiency upgrades
Modifications to declarations
• The declaration for the 4d program commitments runs with the property. Anyone buying and
selling 4d property should contact Jesse Anderson at janderson@ci.brooklyn-center.mn.us to
complete an assignment, assumption and consent form transferring the declaration to the
new owner.
• Any other changes to the declaration, such as revisions to the Exhibit B document specifying
which units in the building are restricted, should also contact Jesse Anderson.
What does annual compliance involve?
To continue to receive 4d status, property owners are required to submit:
• An annual 4d application to Minnesota Housing
• An annual report to the City of Brooklyn Center
2020 rent and income restrictions, Brooklyn Center 4d Affordable
Housing Incentive Program
*2020 program rent and income limits based on 50 percent of the Twin Cities area median income
(AMI). Rent and income restrictions are adjusted annually, typically in the spring.
Type of unit 50 percent area median income (AMI)
Studio/efficiency $905
1 bedroom $970
2 bedroom $1,163
3 bedroom $1,344
4 bedroom $1,500
5 bedroom $1,655
MEMORAN DUM - COUN CIL WORK SESSION
DAT E:3/9/2020
TO :C ity C ouncil
F R O M:C urt Boganey, C ity Manager
T HR O UG H:N/A
BY:Meg Beekman, C ommunity Develo pment Directo r
S UBJEC T:Housing P olicy F ramework (45 minutes)
Recommendation:
- C onsider the proposed housing policy framework, and p rovide direction rela ting to housing efforts.
Background:
Housing and the policy issues related to hous ing have become some of the most pres sing and important matters facing communities today. F or mo st
suburban communities, housing comprises a signific ant majority of a cities land use and tax base. Maintaining and preserving a safe, quality, and desirable
hous ing stock is critic al to a co mmunity's long term economic health. F urther, a divers e housing stock whic h offers a wide range of housing choices and
price po ints ens ures that a community can be resilient through economic ups and d owns as well as provid e housing options for a diverse population
throughout their lives .
In addition to maintaining a quality and divers e supply of ho using, communities are more and more becoming foc used on conc erns regarding livab ility
and ac ces sibility of housing. T he Twin C ities Metropolitan Area is currently experience record low vacancy rates. According to Marquette Advisors’
midyear report from August 2019, the average vacancy rate across the s even-county metro area is 2.3 percent. Experts agree that a balanced rental market
will typically see an average vacancy rate of around 5 percent.
T he Twin C ities has been experiencing record low vacancy rates for several years now as are many metro areas throughout the nation. S evere housing
shortages are being caus ed from spikes in construction costs, combined with unprecedented demand for rental housing as millennial and baby boomer
generations are finding similar des ires for lifes tyles that offer more mob ility and convenience o ver the debt and maintenance of home ownership . In
ad dition, as the cost of living out pac es incomes, for many families, home ownership may feel out of reach, and renting b ecomes the only choice.
T he effect of low vacancy rates o ver time is increasing rents, a growing interest from outs ide investors , and landlords in a position to be choosier about
who they rent to. T his has borne out throughout the Twin C ities Metropolitan Area, with the average rent inc reasing nearly 8 percent year over year to a
current unprecedented $1,254 per month. In addition, the Metropolitan C ouncil continues to see a reduction in the number of landlords accepting S ection
8 vouchers. According to the Metropo litan C ouncil, landlords are citing the increased interest for their units from non-voucher ho lders as the primary
reas on for the change.
Yet another impact of the increasing value of rental property is the growing number of inves tors p urchasing C lass B o r C lass C rental p roperties, which
are renting for naturally affordable rents, making c osmetic improvements, and increasing rents so that the units are no longer affordable. According to the
Minnes ota Hous ing P artners hip, the sales of apartment buildings in the metro area jumped 165 percent between 2010 and 2015. O ften the change in
ownership will also c ome with a c hange in policy related to criminal history, acc eptance of S ection 8 vouchers, or minimum income requirements,
resulting in existing tenants b eing dis plac ed from the p roperty.
Bro o klyn C enter’s C urrent Rental H o using
T he result of the regional trends described above are being felt in Brooklyn C enter. Vacancy rates in the community remain lower than the regional
average, hovering around 2 percent. T his is common in communities with more affordable rental units.
35 perc ent of Brooklyn C enter's hous ing stock is compris ed of rental units. O f those, about 8 percent are single family homes . T he C o mmunity
Development Department is preparing a summary report on the rental licensing program which includes a deeper analys is of rental hous ing in the C ity.
T his will be pres ented as part of a separate memo.
According to the Metrop olitan C ouncil, the following table indicates what is considered affordable rents in the Twin C ities Metropolitan Area:
*Rents include tenant-paid utilities
According to the C ensus American C ommunity Survey indicates average gross rents in Brooklyn Center:
Average rents in Broo klyn C enter are considered naturally occurring affordable because the market rents, bas ed on the age and c ondition of the units
make them affordable at around 50 percent AMI in the metropolitan area. R ents in Brooklyn C enter are lower than the regional average. App roximately 90
percent of all of the ho using units in Brooklyn C enter are cons idered naturally occurring afford able housing (NO AH). While NO AH properties are
cons idered affordable, they can be at risk of being los t as market demand increas es and rents continue to go up. T hey can also experience disinvestment
over time, causing deterioration, loss of value, and most importantly poor quality or unsafe living situations.
At pres ent only 3.7 perc ent of units are cons idered legally-binding, or subsidized affo rdable units. S ubsidized affo rdable units are housing units which are
required to maintain an affordable rent regardless of shifts in market demand. Due to their financing structure, they also are required to be maintained to a
certain minimum standard. O ne of the goals of affordable housing advocates is to p reserve existing NO AH properties b y converting them to legally
binding afford able units through NO AH preservation pro grams. With the c onstruction of S onder Housing, R eal Es tate Equities will be adding 270 units
of legally-bind ing new affordab le housing units to the c ity. T hese will be the firs t new co nstruction multi-family hous ing units built in Brooklyn C enter
sinc e 1971, and will increase the perc entage of legally-binding affordable units to 6 percent.
The City's 2040 Comprehensive Plan identifies several broad housing goals
2040 H ousing & Neighborhood Goals
P romo te a diverse hous ing stock that provides s afe, stab le, and accessible housing o ptions to all of Brooklyn C enter ’s residents.
R ecognize and identify ways to match Brooklyn C enter ’s housing with the C ity’s changing demograp hics.
Explore opportunities to improve the C ity’s housing policies and ordinances to make them more res pons ive to current and future residents.
Maintain the existing housing s tock in primarily single-family neighborhoods through proper ordinances, incentive programs and enforcement.
Explore opportunities to inc orporate new affordable hous ing into redevelopment areas that promote safe, s ecure and economically diverse
neighborhoods.
In addition to these goals , the 2040 C omp rehensive P lan id entifies implementation s trategies as well as res ources and tools for achieving its housing
goals. T hes e are contained in C hapters 4 and 9, of the Housing and Implementation chapters respectively (attac hed).
Issue Identificatio n
As engagement related to the comprehensive plan and various redevelopment sites have occurred throughout the c ommunity over the past few years , a
number of issues, concerns, and priority areas have bubb led up related to housing. Many of these issues are identified in the 2040 C omprehensive P lan.
As it relates to housing polic y within the C ity of Brooklyn C enter, these issues c an be categorized into two distinct topic areas:
1. Housing choice - What is the c omposition and condition of the current housing s tock? What are the current market demands fo r housing? How
does the c ity's housing s tock relate to the market, and does the city have enough and the right type to meet current and future need?
2. Affordable housing policies - W hat can the city do to improve livability and accessibility to quality affo rdable hous ing for res idents ? W hat best
prac tices exist to s uppo rt an effec tive approach to addres sing the need for affordable hous ing in the c ommunity? W hat polic ies are mo st effective
to prevent d is plac ement?
In o rder to address these to pic areas related to housing, staff is proposing a framework plan which takes a c omprehens ive review of the C ity's housing
polic y approac h, with an emphasis in key focus areas based on priorities iss ues which merit sp ecial attention.
T he overall review would include identifying those housing issues which are currently surfacing in the community and prioritizing those which are most
pressing. I ssues which have broadly been identified that merit special attention include:
Mitigating and p reventing d is placement of existing residents as the c ommunity redevelops
Tenant protections
C reating and expanding home ownership op portunities
F air hous ing policy
Maintenance and preservation of single family housing s tock
Expand ing hous ing options
Housing Po licy Framewo rk
In o rder to gather data and to identify the needs for additional housing choice in the community, staff is reco mmending working with a cons ultant to
complete a housing study. A p ropos ed s co pe of work for the housing study is attac hed to this memo. T he s tudy would include an analysis of regio nal
trends effecting Brooklyn C enter's housing, the city's existing housing s tock, current rent trend s, market demand and gaps analysis. T he housing study is
also proposed to include a tenant and home owner survey in order to ascertain whether residents are satisfied with their current housing options, and what
also proposed to include a tenant and home owner survey in order to ascertain whether residents are satisfied with their current housing options, and what
housing choices they anticipate needing/wanting over time. T he results of this analysis will assist with guiding land use and policy decisions as it pertains to
housing stock and choice.
As it relates to the needs around affordable housing, policy approaches fall into one of three categories: 1) C onstruction of new legally-binding units ; 2)
P reservation of NO AH units; 3) Tenant protections
In April 2018, the C ity C ouncil discussed several poss ible policies to addres s affordable housing iss ues . T he memo from that discussion is attached to
this report. Based on that disc uss ion, C ouncil directed s taff to move forward with a Tenant P rotection O rdinance, and in December 2018, the c ity
ad opted one.
Additional policies which addres s affordable housing topic s are describ ed below. S taff is s eeking direc tio n on which po licies C ouncil would like to move
forward with, would like additional informatio n on, or would like to wait on.
Inclusionary Hous ing P olicy (C reation P olic y) – T hese are a collec tion of policies whic h would either encourage or require new affordable units to b e
included as part of new market-rate res idential development projects whic h receive public subs idy or other d is cretionary C ity approvals . F requently it is
in the form of a req uirement that a percentage of units be affordab le in a new residential development in exchange for public s ubsidy of the project.
New developments such as thos e in the O pportunity S ite would be required to inc lude a certain numb er of affordable units .
Inclusionary Ho using policies ensure that new affordable units are added as market-rate units are built, thus ens uring mixed-income co mmunities .
C ities such as S t. Louis P ark and Minneapolis have found that in higher rent developments, a certain p ercentage of affo rdable units c an b e required
without increasing the need fo r additional public subsidy. T his is due to the higher than average market rents , which o ff-set the affordable units. In
Brooklyn C enter, as is true in communities with lower average rents, the cost of the affordable units would require additional public subs idies in
order for a project to be financially feasible.
Brooklyn P ark recently adopted an Inc lusionary Hous ing P olicy. As p art of their analysis they concluded that any amount of includ ed afford able
would create a financial gap in the p rojec t and require subs idy. T he policy acknowledges this and projects will b e looked at on a project by projec t
bas is to determine if the gap can be financed.
C ommunity input on the O pportunity S ite has identified many community benefits and goals for the redevelopment in addition to affordable
housing; affordable commercial space, a cultural center, civic s pace, event sp ace, and a recreation center to name a few. All of these us es wo uld
require public s ub sidy in s ome form or another, not to mention the infrastructure need s of the s ite. Identifying afford able housing as a singular or
primary goal of the development through an inclus ionary hous ing polic y inevitably elevates it above other community goals for the s ite.
NO AH P reservation P ro gram (P res ervatio n P olicy) – A preservation pro gram can be set up in vario us ways, but essentially how they work is to
incentivize existing NO AH property owners into setting aside a percentage of rental units as legally b inding affordable for a set period of time. T he C ity
would create a NO AH pres ervation fund and identify additional funding sources to grow it. S taff would work with exis ting property owners to provide a
modest s ubsidy for building rehabilitation, which would then be combined with a 4D tax class ification, als o known as the Low Income R ental
C lassification P rogram (LIR C ), to provid e a property tax b reak, c urrently amounting to 40%. T he res ult is the preservation of NO AH units through
legally binding contract.
T he tax break would be propo rtional to the percentage of units which would be affordable, and not apply to the entire building.
T he LI R C /4D statute d efines eligible properties as those which meet two conditions: the owner of the property agrees to rent and income
restrictions (serving household s at 60% AMI or below) and receives “financ ial as sistanc e” from federal, state or local government. T his pres ents
the possib ility of creating a “Local 4D” program in which qualifying properties receive the 4D tax break in return for agreeing to conditio ns which
meet certain local government policy goals .
T he reduc tio n in property taxes would no t dec rease the C ity’s revenue from property taxes, as the funds would be distributed to all other
properties; however, it would reduce that pro perty’s share of loc al property taxes.
T he amount of the tax break is a limiting factor as it equates to around $80/unit per year; however, the program may be an incentive for a property
owner in a community where the market rents are already c onsidered affordable, since they would not need to depres s their rent rates.
T he city is estimated to have approximately $320,000 of Housing T IF #3 funds when T IF #3 decertifies at the end of 2021. T hese funds could be
used to seed a NO AH p reservation fund.
NO AH preservation is a more c ost efficient fo rm of creating legally binding affordable units compared with new cons truction, and ensures families
are not displaced from their homes . A NO AH preservation program, combined with efforts to support tenant protections could be highly effective
at address ing community conc erns about displacement. F urther, staff could begin to work on setting up such a program in the near term, and begin
to identify p otential funding sources for it.
F air Housing P o licy (Tenant P rotection P olic y) - T itle VI I I of the C ivil R ights Act establishes federal policy for providing fair housing throughout the United
S tates. T he intent of Title VI I I is to assure equal housing opportunities for all citizens. Further, C ities as a recipient of federal community development funds
under Title I of the Housing and Community D evelopment Act of 1974, is obligated to certify that it will affirmatively further fair housing.
T he city of Bloomington's Fair Housing P olicy is attached as an example. Many other cities within Minnesota have Fair Housing P olicies that are
written very similar to B loomington's.
At present Brooklyn Center does not have a Fair H ousing P olicy. I t is staff's recommendation that this be addressed in the near term, and that the
H ousing Commission be tasked with reviewing and recommending a policy to be adopted by the C ity.
R eview R ental Licensing through the lend of Tenant P rotections (Tenant P ro tection P olic y) - Nearly a third of the City's housing units are rental. With
vacancy rates hovering near 3 percent, tenants are not in a favorable position when it comes to negotiating with landlords on lease terms or other
accommodations. N early all of the City's multi-family residential is considered naturally occurring affordable housing (N O AH ). T his is primarily due to its age
and condition. Brooklyn C enter hasn't had new multi-family housing constructed since 1971, and so this particular housing type, like most in the City, is aging.
M aintenance varies significantly depending on ownership, as does the quality of property management. T herefore, it is important to continue to monitor the
City's N O AH properties through a robust rental license program. However, when the rental license program was established tenant protections was not the
focus of the program. A review of the City's ordinances, policies, and procedures through the lens of tenant protections would ensure that the program is
serving residents as effectively as possible.
C ommunity engagement strategies would be necessary to identify problems and potential solutions. Suggested engagement strategies include lis tening
s ess ions with tenants and landlords; and engaging stakeholders s uc h as Homeline, Hous ing Justic e C enter, AC ER , etc
s ess ions with tenants and landlords; and engaging stakeholders s uc h as Homeline, Hous ing Justic e C enter, AC ER , etc
C ity s taff have met with AC ER , Homeline, and the Housing Justice C enter and d is cussed some of the iss ues affecting Brooklyn C enter res idents
already. In additio n, the city's housing inspec tors spend a significant amount of time interacting with tenants and landlords and understand the
complexities of the is sues. T hese resources can be drawn upon to further explore ways to make adjus tments to the C ity's ord inances, policies, and
procedures to ens ure existing residents are provided safe, s ecure, s table housing and tenants are afforded protections under the law.
S taff's rec ommendation is to move forward with reviewing the city's current polic y and ordinance, and to begin to implement impro vements.
Tenant input could be incorporated into the tenant survey that is part of the housing stud y.
S ingle F amily Housing S tabilization (P reservation P olic y) - Approximately 86 percent of Brooklyn Center's single family housing stock is more then 40
years old. T his is a significant portion of the City's housing, therefore it is important to track the condition of these older homes as they are at-risk of deferred
maintenance. At the same time, well maintained older homes can be an important source of entry-level housing. When considering the type and age of
housing in Brooklyn Center, the 2040 Comprehensive plan recommended the following programs:
Housing s tudy to ass ess the condition of the C ity's housing stock
Home O wnership P rogram Assistance P rogram
Down P ayment As sistanc e
Home O wners hip Education
Additional Low or No C ost Home impro vement funding
S taff reco mmends moving forward with a review of the city's single family housing programs. T he first part of whic h would be inco rporated into the
hous ing study.
R eview of Additio nal Best P rac tices to Mitigate and P revent Displacement - Ho using S tudy and Impact Ass essment - As was mentioned above, staff is
recommending moving forward with a housing study in the near-term. Because issues around the impact of significant development on the city's existing
housing, particularly around displacement and gentrification, have been raised in the community, staff is proposing to include within the housing study an
impact assessment to evaluate the potential impact of the Opportunity Site in this way. T he study would include a literature review of existing research on the
topic of displacement and gentrification as it may pertain to Brooklyn Center, as well as case studies and best practices from other places that the community
might draw from. T he study, as the scope is currently proposed, would assist with providing an informed basis from which policy decisions can be made. T he
outcome of the study would allow us to identify additional policies and best practices which may forward the city's priorities around housing policy.
Implementation
Housing policy is both an urgent and important need in the community; ho wever, staff c apacity is als o limited to ad dress thes e is sues in a timely manner.
S ome items identified above c ould be und ertaken immediately such as the ho using study and the creation of a fair housing policy. A NO AH preservatio n
program may be a policy whic h could als o be addres sed in the near-term. O ther items will take longer to addres s such as reviewing of the city's rental
licensing ordinance.
T he C ity of Brooklyn P ark currently fac ilitates a hous ing stakeholder group with many of the s ame s takeholders which Brooklyn C enter would very likely
ask to particip ate in similar conversatio ns. R ather than hold a sec ond meeting each month, Bro oklyn P ark s taff has suggested the two c ities combine
efforts with the group. T his also offers the opportunity to share research and resources on topics which are likely to be of a similar nature in terms of
hous ing is sues.
It may also be valuable to create subject specific Housing Task F orces , over time, as each housing area is addres sed. T his can be vetting as wo rk
progresses . Not only would this allo w greater community engagement, but also ensure that as various areas of focus are under review (i.e. tenant
protections, single family preservation, multi-family preservation) that the right people are at the table to provide inp ut and expertise. T hough, inevitably,
task forces and co mmittees take considerable s taff time to facilitate and manage. Ensuring that any engagement that is done is intentional and on topics
where input is warranted is critical.
S taff has identified 5 key areas to address over the next 18 months. Other priority areas may arise through continued engagement which would require an
adjustment to this framework.
Tentative Time Line
1. Q 1 2020 F air Hous ing P olicy
2. Q 1 2020 Housing S tudy and Impact Assessment - G aps analysis and identify best practices for anti-displacement
3. Q 2 2020 NO AH P reservation program
4. Q 4 2020 Tenant P rotections
5. Q 1 2021 S ingle F amily Housing S tabilization
Next Steps
S taff reco mmends moving forward initially with the Hous ing C ommission undertaking the review and d rafting of a F air Ho using polic y, which would then
go to the C ity C ouncil fo r final c onsideration. In addition, staff would recommend proc eed ing with the hous ing study and impac t as ses sment as the initial
step .
Policy Issues:
W hat housing-related iss ues /topics do you see rising to the surface in the community?
Are there any major elements you see needing to be addressed in the housing study in order to create a thorough baseline as sess ment of the C ity's
housing s tock?
S hould staff begin wo rking with the Housing C ommiss ion on developing a F air Hous ing P olicy?
Do you have any questions /concerns with the framework for a Housing P olicy P lan as it has been laid out?
Is the C o uncil comfortable with mo ving forward with the housing stud y and gaps analys is ?
Is the C o uncil comfortable with mo ving forward with the housing stud y and gaps analys is ?
S trategic P riorities and Values:
R es ident Economic S tab ility, S afe, S ecure, S tab le C ommunity
ATTAC HME N TS:
Description Upload Date Type
Housing F act S heet 11/19/2019 Backup Material
April 9, 2018 - C ity C ounc il Memo - Affo rdable Housing P olicy 11/19/2019 Backup Material
Housing S tudy S c ope of Work 11/19/2019 Backup Material
Example Housing G aps Analysis 11/19/2019 Backup Material
C hapter 4 - Ho using 6/10/2019 Backup Material
C hapter 9 - Implementation C hapter 10/22/2019 Backup Material
F air Hous ing P olicy Example 8/16/2019 Backup Material
Dis trib ution of Naturally O ccurring Affordable Housing Buildings in Hennepin C ounty 11/20/2019 Backup Material
R E VIE WE RS :
Dep artment R eviewer Action Date
C ommunity Development S uc iu, Barb Approved 3/4/2020 - 2:38 P M
MEMORANDUM – COUNCIL WORK SESSION
Our Vision: We envision Brooklyn Center as a thriving, diverse community with a full range of housing, business, cultural and
recreational offerings. It is a safe and inclusive place that people of all ages love to call home, and visitors enjoy due to its
convenient location and commitment to a healthy environment
DATE: April 9, 2018
TO: Curt Boganey, City Manager
FROM: Jesse Anderson, Deputy Director of Community Development
THROUGH: Meg Beekman, Community Development Director
SUBJECT: Affordable Housing Policy
Recommendation:
It is recommended that the City Council consider providing direction to staff regarding potential
affordable housing policies for the City.
Background:
In May of 2017, the City Council received copies of emails forwarded by Councilmember Butler
from African Career and Education Resource Inc. (ACER) requesting an opportunity to come
before the City Council to discuss concerns about the need for affordable housing in Brooklyn
Center. In addition Mayor Willson was in contact with a representative of Community Action
Partnership of Hennepin County (CAPHC) regarding the same topic.
On July 10, 2017, by consensus the City Council directed staff to invite representatives from
ACER and CAPHC to a future work session to present information and have a dialogue on the
issue of affordable housing.
On August 14, 2017, the City Council received a presentation from ACER and CAPHC
regarding the topic of affordable housing. At the presentation ACER and CAPHC advocated that
the City consider adopting policies that would address the region’s need for affordable housing,
protect tenants, and help preserve naturally occurring affordable housing. The Council directed
staff to bring the subject back to a future work session for discussion.
Regional Housing Trends:
The Twin Cities Metropolitan Area is currently experience record low vacancy rates. According
to Marquette Advisors’ midyear report in August 2017, the average vacancy rate across the Twin
Cities metro was 2.4 percent. Experts agree that a balanced rental market will typically see an
average vacancy rate of around 5 percent.
The impact of low vacancy rates over time has increased rents, a growing interest from outside
investors, and landlords in a position to be choosier about who they rent to. This has borne out
throughout the Twin Cities Metropolitan Area as rents have gone up throughout the region. The
average rent at the end of July 2017 had increased 3.1-pecent year over year. In addition, the
Metropolitan Council is seeing a reduction in the number of landlords accepting Section 8
MEMORANDUM – COUNCIL WORK SESSION
Our Vision: We envision Brooklyn Center as a thriving, diverse community with a full range of housing, business, cultural and
recreational offerings. It is a safe and inclusive place that people of all ages love to call home, and visitors enjoy due to its
convenient location and commitment to a healthy environment
vouchers. According to the Metropolitan Council, landlords are citing the increased interest for
their units from non-voucher holders as the primary reason for the change.
Yet another impact of the increasing value of rental property is the growing number of investors
purchasing Class B or Class C rental properties, which are renting for naturally affordable rents,
making cosmetic improvements, and increasing rents so that the units are no longer affordable.
According to the Minnesota Housing Partnership, the sales of apartment buildings in the metro
area jumped 165 percent between 2010 and 2015. Often the change in ownership will also come
with a change in policy related to criminal history, acceptance of Section 8 vouchers, or
minimum income requirements, resulting in existing tenants being displaced from the property.
The region is also seeing a loss of smaller-sized rental properties (1-4-units). This is due, in part
to single family properties converting back into owner-occupied as the market recovers from the
recession, but also a growing number of local investors purchasing smaller properties and
flipping them. While some of the proposed policies would impact single family rentals, the
primary focus of affordable housing advocates and media attention has been on larger properties
(40-units or greater).
Affordable housing advocates have identified potential policies designed to address these issues.
The policies fall into one of three categories; 1) preservation policies designed to preserve
naturally occurring affordable housing and prevent it from being flipped; 2) tenant protection
policies designed to prevent or mitigate displacement; and 3) creation policies designed to create
new, legally-binding, affordable housing that will replace the naturally occurring affordable
housing that is being lost.
Brooklyn Center’s Current Rental Housing:
According to the Metropolitan Council, the following table indicates what is considered
affordable rents in the Twin Cities Metropolitan Area:
# of Bedrooms 30% AMI 50% AMI 60% AMI 80% AMI
Efficiency $474 $791 $949 $1,265
1-Bedroom $508 $848 $1,017 $1,356
2-Bedroom $610 $1,017 $1,220 $1,627
3-Bedroom $705 $1,175 $1,410 $1,880
4-Bedroom $786 $1,311 $1,573 $2,097
*Rents include tenant-paid utilities
According to the Metropolitan Council, the following table indicates average rents in Brooklyn
Center:
# of Bedrooms Survey 5-Year Avg
Efficiency $730 $744
1-Bedroom $869 $801
2-Bedroom $1,019 $925
3+ Bedroom $1,281 $1,147
MEMORANDUM – COUNCIL WORK SESSION
Our Vision: We envision Brooklyn Center as a thriving, diverse community with a full range of housing, business, cultural and
recreational offerings. It is a safe and inclusive place that people of all ages love to call home, and visitors enjoy due to its
convenient location and commitment to a healthy environment
Brooklyn Center currently has 834 rental license holders. 713 of those are for single family
homes. 71 of the licenses are for 2-4-unit properties. 24 are for properties with between 5 and 39
units. 27 licenses are for properties with greater than 40 units. There are approximately 4,300
rental units in the City. The average rents in Brooklyn Center are considered affordable for those
making around 50 percent of the Area Median Income. Of the 11,608 total housing units (both
rental and owner-occupied) in Brooklyn Center, 89.5 percent are naturally occurring affordable
housing. There are currently 402 Section 8 voucher holders in the City.
Brooklyn Center currently has five apartment building that are legally-binding affordable
housing, Ewing Square Townhomes (23-units), The Crest Apartments (69-units), Unity Place
(112-units), Emerson Chalet Apartments (18-units), and The Sanctuary (158-units). Also,
Lynwood Apartment (50-units) is currently applying for Certified Low Income Status, which
would make it a legally-binding affordable property. This equates to 3.7 percent of the City’s
housing stock is legally-binding affordable housing.
Anecdotally, a recent phone survey of 34 Brooklyn Center landlords found a current average
vacancy rate of 1.3 percent.
Rents in Brooklyn Center are currently very affordable compared to the region. Low rents may
be contributing to the low vacancy rates. If the vacancy rates are in fact below 2 percent, and
they remain that low over time, it would be reasonable to expect rents to increase. However,
given the current low rents, even an increase in rents of 20-30 percent would result in rents still
considered affordable for those making 60-80% AMI.
Affordable Policy Options:
Section 8 Ordinance (Tenant Protection) - Prohibiting discrimination against Section 8 voucher
holders and other recipients of government programs. The policy would prohibit landlords from
denying any tenants’ application based on the applicant receiving government assistance.
• Staff surveyed 34 Brooklyn Center apartments and found that 50 percent indicated that
they do not accept section 8 vouchers.
• Minneapolis recently adopted this ordinance, which allows applicants who feel they have
been discriminated against to seek damages through the city’s department of Civil Rights.
• The City of Minneapolis has an active lawsuit filed against them by 55 apartment owners
over the legality of this ordinance. The lawsuit argues the mandate conflicts with state law
and unfairly forces them to comply with requirements of federal housing voucher programs
for low-income residents. It also says the law violates the Minnesota Constitution because it
reduces their property values, forces landlords to enter into contracts and represents an
unnecessary government intervention in their businesses. Landlords also claim that this could
cause landlords to increase rent and/or application criteria as to price out Section 8
vouchers.
Staff feels that if the ordinance is upheld by the courts, it could be a useful tool to ensure
residents are not discriminated against based on their source of income; however
additional review would be necessary related to the enforcement of the ordinance. Staff
MEMORANDUM – COUNCIL WORK SESSION
Our Vision: We envision Brooklyn Center as a thriving, diverse community with a full range of housing, business, cultural and
recreational offerings. It is a safe and inclusive place that people of all ages love to call home, and visitors enjoy due to its
convenient location and commitment to a healthy environment
recommends that the City monitor the Minneapolis lawsuit then review pending the
outcome.
Notice of Intent to Sell (Preservation) – Rental property owners must give advanced notice prior
to the sale of a rental property. This gives a preservation buyer an opportunity to match the
purchase price. It would also give service providers additional time to relocate residents who
would be displaced as a result of the sale.
• Landlords would be concerned about delaying the closing of a property sale, which could
have a negative effect on price. Preservation companies such as Aeon have expressed
concerns that this could increase the competition for these properties, and thusly increase
sales prices.
• Enforcement would be difficult because the penalty would come after the sale has
occurred. If the property has sold, the seller no longer has ties to the property so
enforcing a citation could be challenging and may not be a deterrent. In a workgroup in
St. Louis Park landlords stated that if there was a $1000.00 citation for selling without
notice, they would likely still sell the property and pay the citation.
• It is unclear who the seller would need to notify of their intent to sell and what would be
done with that information once it was known. Who would decide what buyers could
have access to the information? Who would be responsible for disseminating the
information?
• It is possible that this ordinance would dissuade investors, who may opt to purchase
property in cities that do not have the additional requirements.
• St. Louis Park is looking at an alternative ordinance related to tenant transition/protection
would address the need for additional time to relocate tenants.
Staff recommends that the city consider other options such as the tenant transition
ordinance.
Tenant Transition/Protection Ordinance (Tenant Protection) – This would require a new owner
of a naturally occurring affordable housing property to pay relocation benefits to tenants if the
new owner increases rent, rescreens existing residents or implements non-renewals without cause
within 3 months after the purchase. The ordinance has the effect of freezing lease terms for 90
days after the sale of a property. The purpose is to allow tenants three (3) months to relocate if
necessary.
• This ordinance wouldn’t interfere with the sale of naturally occurring affordable housing,
however; it would provide assistance to the tenants if necessary.
• The ordinance would require new buyers to notify tenants within 30 days if substantive
changes to the lease are forthcoming, giving tenants time to relocate if necessary.
• St. Louis Park adopted the Tenant Protection Ordinance in March of 2018.
• The policy could dissuade potential apartment buyers from buying in Brooklyn Center,
who may opt to purchase a property in a city without this policy.
Staff recommends that the City review this policy further to determine the legality of it,
the enforcement mechanism, and what the specific impacts in Brooklyn Center might be.
MEMORANDUM – COUNCIL WORK SESSION
Our Vision: We envision Brooklyn Center as a thriving, diverse community with a full range of housing, business, cultural and
recreational offerings. It is a safe and inclusive place that people of all ages love to call home, and visitors enjoy due to its
convenient location and commitment to a healthy environment
Just-Cause Eviction (Tenant Protection) – Also known as Just-Cause Non-Renewal, this would
require a landlord to provide a reason if they were going to not renew a tenant’s lease that was
expiring. Currently landlords must provide a just cause for eviction, which a tenant can appeal in
court. There is no appeal process available to tenants who lose their housing due to non-renewal
of lease.
• Landlords see this as taking away a valuable management tool for dealing with problem
tenants and have the unintended consequence of increasing the number of evictions filed
and strengthening screening standards.
• When St. Louis Park conducted their meetings with landlords and the Multi-family
Housing Association, this ordinance received the strongest opposition.
• The enforcement of this policy would be through the court system and would require a
tenant to take legal action against their landlord via a lawsuit.
• Of the 34 landlords surveyed by staff, the majority of evictions or non-renewals are the
result of non-payment of rent or criminal activity.
• The intent of this ordinance would be to protect tenants from being non-renewed in the
event a new owner wants to empty a building in order to do a substantial renovation with
the goal of increasing rents.
Staff recommends that the City consider other options such as the tenant transition
ordinance to protect tenants.
Inclusionary Housing Policy (Creation) – These are a collection of policies that could be adopted
by the city which would either encourage or require new affordable units to be included as part
of new market-rate residential development projects which receive public subsidy or other
discretionary City approvals. Frequently it is in the form of a requirement that a percentage of
units be affordable in a new residential development in exchange for public subsidy of the
project.
• New developments such as the Opportunity Site would be required to include a certain
number of affordable units.
• Inclusionary Housing policies ensure that new affordable units are added as market-rate
units are built, thus ensuring mixed-income communities.
• Cities such as St. Louis Park and Minneapolis have found that in higher rent
developments, a certain percentage of affordable units can be required without increasing
the need for additional public subsidy. This is due to the higher than average market
rents, which off-set the affordable units. In Brooklyn Center, as is true in communities
with lower average rents, it is likely that the cost of the affordable units would require
additional public subsidies in order for a project to be financially feasible.
If the Council would like to move forward with this police staff would recommend
reviewing the feasibility of future development if an affordable housing policy is
adopted.
4D Tax Breaks (Preservation) – Also known as the Low Income Rental Classification Program
(LIRC), Minnesota provides a property tax break, currently amounting to 40%, to subsidized
rental properties under LIRC, commonly referred to as the 4D program. There is the potential,
MEMORANDUM – COUNCIL WORK SESSION
Our Vision: We envision Brooklyn Center as a thriving, diverse community with a full range of housing, business, cultural and
recreational offerings. It is a safe and inclusive place that people of all ages love to call home, and visitors enjoy due to its
convenient location and commitment to a healthy environment
however, to extend 4D eligibility to certain currently unsubsidized affordable properties, without
changing current law. This is because the LIRC/4D statute defines eligible properties as those
which meet two conditions: the owner of the property agrees to rent and income restrictions
(serving households at 60% AMI or below) and receives “financial assistance” from federal,
state or local government. This presents the possibility of creating a “Local 4D” program in
which qualifying properties receive the 4D tax break in return for agreeing to conditions which
meet certain local government policy goals.
• A government agency would need to provide a financial contribution to a rental
apartment with a low income agreement placed on the property. The property could then
be eligible to apply for 4D status. This would allow a landlord to make physical
improvements to the property in exchange for affordable rents.
• The reduction in property taxes would not decrease the City’s revenue from property
taxes, as the funds would be distributed to all other properties; however, it would reduce
that property’s share of local property taxes.
• The amount of the tax break is a limiting factor as it equates to around $80/unit per year;
however, the program may be an incentive for a property owner in a community where
the market rents are already considered affordable, since they would not need to depress
their rent rates.
• Hennepin County is looking into a rehabilitation program for rental properties which
would function similarly to the CDBG housing rehabilitation program, but be County
funded.
• The City could also look at funding a program for rental housing rehabilitation.
Staff recommends working with the County to determine the feasibility of a County-led
program. The City could also review EDA or TIF 3 Housing funds to determine the
availability of funds for a city program that would provide rental housing rehab
assistance in exchange for a 5-10 year affordability requirement. This could be set up as a
per unit matching forgivable loan.
Other Policies/Programs
• Identify buildings that are at-risk of being flipped. Reach out to owners of at-risk
buildings and gauge their short and long-term plans. Help connect them with preservation
buyers on a case-by-case basis.
• Comprehensive Plan – the City is in the process of updating its Comprehensive Plan. If
the preservation and/or creation of affordable housing are a priority for the City, it should
be reflected in the City’s Comprehensive Plan.
• Education – Work with the Metropolitan Council to provide education on Section 8
voucher programs to dispel some of the negative perceptions of the program.
Policy Issues:
Does the Council believe that the information presented indicates a need for additional policy
actions to address the concerns raised regarding affordable housing and the protection of tenant
rights?
MEMORANDUM – COUNCIL WORK SESSION
Our Vision: We envision Brooklyn Center as a thriving, diverse community with a full range of housing, business, cultural and
recreational offerings. It is a safe and inclusive place that people of all ages love to call home, and visitors enjoy due to its
convenient location and commitment to a healthy environment
Does the Council require additional information regarding these issues before concluding if
further policy actions are necessary?
Which policies if any would the Council want brought back for further consideration?
Which policy does the council consider a higher priority?
Strategic Priorities:
• Resident Economic Stability
Attachments:
US Census Bureau Data
Metropolitan Council Land use Chart
August 14, 2017 Council Work Session Memo
August 14, 2017 Council Work Session Minutes
Housing Strategies Table Presented at Previous Work-Session
Mixed-Income Housing Policies among Neighboring Cities Table
Phone Survey of Brooklyn Center Apartments
Phone Survey of Brooklyn Center Single Family Property Management Companies:
US Census Bureau Data:
Metropolitan Council Land Use Chart:
Housing Strategies Table Presented at Previous Work-Session
Mixed-Income Housing Policies among Neighboring Cities City Policy/Program Type Affordability Requirements Affordability Period Opt-out (alternative) options Enforcement Tool Other Notes St. Louis Park (2015) • City financial assistance for new developments creating at least 10 multi-family units or renovation of an existing multi-family development with at least 10 units. • 18% of total units in the development required at 60% AMI or 10% of units required affordable at 50% AMI. • Families may remain in the dwelling unit as long as the income does not exceed 120% AMI. • 25 year minimum (considering an increase). • Subject to City Council approval: o Dedication of existing units o Offsite construction near public transit o Participation in construction of affordable units by another developer within the City • Affordable Housing Performance Agreement between City and Developer prior to Zoning Compliance Permit being issued. • Implemented 2015 – 6/7 new developments triggered policy with 1,073 units and 281 affordable units produced. • No development has used an opt-out option. • Units must be located within the development and distributed throughout the building unless approved by City Council. Edina (2015) • Re-zoning or Comprehensive Plan Amendment for all new multi-family development of 20 or more units. • 10% of all rentable area at 50% AMI or 20% of all rentable area at 60% AMI. • 15 year minimum. • Dedication of existing units equal to 110%, must be equivalent quality. • New construction at a different site. • Participation in construction of affordable units by another developer within the City. • Land use restrictive covenant. • PUD ordinance states development must consider affordability. • City will consider incentives for developments with affordable housing including: Density bonuses, parking reductions, TIF, deferred low interest loans from the Edina Foundation, and Tax Abatement. Golden Valley (policy approved in 2017; ordinance in coming months) • Market rate residential development with 10 or more units and receive: o Conditional Use Permit (ord.) o Planned Unit Development o Zoning Map Amendment (ord.) o Comprehensive Plan Amendment o Or Financial Assistance • 15% of total project units at 60% AMI or 10% of project units at 50% AMI. • Families may remain in the dwelling unit as long as the income does not exceed 120% AMI. • 20 year minimum. • Equal or greater amount dedication of existing units. • Affordable Housing Performance Agreement. • Mix of policy and ordinance. • City will consider incentives including: • Minimum in 33% reduction in required parking spaces • Minimum of 10% density bonus Brooklyn Park • New market rate residential development with 10 or more units and receive: o Planned Development Overlay (ord. required) o Zoning Map Amendment (ord. required) o Comprehensive Plan Amendment • Or Financial Assistance • 15% of units at 60% AMI or 10% of units at 50%AMI or 5% of units at 30%AMI • 20 year minimum. • Consider an alternative proposed by developer. • Affordable Housing Performance Agreement. • Mix of policy and ordinance. • Units must be located within the development and distributed throughout the building unless approved by City Council. Minneapolis (2002) • City-assisted housing projects of 10 or more units. • City-assistance includes TIF, condemnation, land buy downs, issuance of bonds to finance project, pass-through funding, and other forms of • Varies based on funding source but generally is either 20% of units at 60% AMI or 20% of units at 50% AMI (AHTF) • 15 year minimum. • None. • Only 1-2 projects have taken advantage of the incentive program since 2002. • Currently engaging a consultant to develop an effective system.
direct subsidy. • Density bonus and parking reduction incentive Saint Paul (2014) • City/HRA assisted rentals and homeownership. • Rental development in selected zones – density bonus incentive • Rentals – 30% of units affordable to households earning 60% AMI, of which at least one third will be affordable to 50% AMI, and at least one third will affordable to 30% AMI. • Rental - 10 year minimum . • Development Agreement • Voluntary/incentive density bonus is not being used so policy is currently being revised. Minnetonka (2004) • City Assistance • Voluntary/incentive based for all developments. • Rentals – 10% of units at 50% AMI for all developments, 20% of units at 50% AMI if using TIF funding. • 30 year minimum. • Considered on a case by case basis. • Development Agreement. • Produced over 500 affordable units since 2004. Eden Prairie • City Assistance • Using a voluntary/incentive based approach for all developments; exploring adopting a policy. • City subsidy – 20% of units at 50% AMI. • Voluntary/incentive – starts at 10% of units at 50% AMI. Woodbury (2012) • Voluntary/incentive based – density bonus policy • 20% of units at 80% AMI or negotiated. • 15 year minimum. Chaska • All developments that need City approval • 30% of units at 80% AMI. Forest Lake (2014) • Voluntary/incentive based – density bonus policy • Negotiable • 15% density bonus, flexible parking requirements.
Phone Survey of Brooklyn Center Apartments: Apartment Name number of Units number of vacant units Rent for a studio Rent for a 1 bedroom Rent for a 2 bedroom Rent for a 3 bedroom Rent for a 4 bedroom Do you accept section 8 Has rent increased over the past 2years? How much has rent increased? Most common reason for Eviction or non-renewal 4819 Azealia 12 0 750 800 no new yes $15-50 non-renewal 5207 Xerxes 12 0 0 Ave: $750 Ave $850 Yes yes 8% Disturbance 5240 Drew 10 0 845-950 yes no police calls for service The Avenue 36 0 755 929 1075 no yes 5% each month non-payment Beard Ave 24 0 $895 1 fl-$1025, 2-3 fl $1075 Yes (Typically don’t meet criteria) yes 100 - 2bd - 1bd 75 smoke in units, police calls (pattern) Brookside Manor 90 0 garden - $750 2-3 floor $800 yes yes $20 police calls, disturbance, non-payment Carrington Dr 128 0 $735 $835-855 $945-975 no yes $50 disturbance, illegal activity, cleanliness, non-payment The Crest 122 3 for end of march $755 $935 yes yes 50 non-payment, crime free addendum Crossings - 6201 Lilac - 55+ 81 4 (0 in past few years) 1181-1275 (1bd + den 1081 1190-1750 No (inherited) yes 2-5% rarely - non-payment Crossings - 6125 Lilac - 55+ 65 1150 Earle Brown Farm 120 1 845-920 1010-190 No new ones yes 3% increase disturbance, non-payment Emerson Chalet 18 0 737 870 yes no non-payment, 3 strikes Gateway 252 3 775 850-875-895 995-1045 no yes 50 late payment, police calls, unit maintenance Granite City 72 0 849 949 1139 yes yes 34-55 smoking Granite Peaks 54 0 849 949 1139 no yes 34-55 non-payment Humboldt Courts 36 1 750 900-995 no yes 75-95 non-payment Lynwood - mark 50 0 895-925 1050-1190 yes Yes 2-4% non-payment of rent Melrose Gates 217 0 919-949 1129-1159 1159-1189 2bd+1.5ba 1209-1249 2bd+2ba no yes 100 non-payment River Glen 128 0 900 975-1000 1250 yes yes 50-75 non-payment/late rent Riverwood Estates 84 2 929 999-1050 no yes 40 lease violation Ryan Lake 22 1 800 800-1000 yes yes 75 non-payment Summerset 36 3 700 800-850 1150-1200 yes yes $50 non-payment, lease violations Twin Lake North 276 3 950+ 1105-1225+ yes yes 5% non-payment, behavior Unity Place 112 2 904-909 970 yes yes 30 non-payment Victoria Townhomes 48 4 1340-1400 no yes 40-60 tenant not renew
Phone Survey of Brooklyn Center Single Family Property Management Companies: Management Agency number of Units number of vacant units Rent for a studio Rent for a 1 bedroom Rent for a 2 bedroom Rent for a 3 bedroom Rent for a 4 bedroom Rent for a 5 bedroom Do you accept section 8 Has rent increased over the past 2years? How much has rent increased? Most common reason for Eviction or non-renewal Prosperous 40 0 1050 1250 1450 1550 yes yes 2-3% non-payment Urban homes 2 1300 1400 1500 Yes NA Juliana Koi 2 1 1350 no yes 50 NA Kathleen Freitag 4 0 1235-1325 1410-1450 no no non-payment; destruction of property Tyang 1 0 1150 no no NA Michelle Nyarecha 1 0 1170-1250 yes no non-payment; police violations Nazeen 2 0 1000 1200 no yes 5% NA Tracy Hinkemyer 7 1350-2000 no no NA Dan tan 4 0 850-950 yes no non-payment drugs, noise
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DRAFT CHAPTER 4:
Housing & Neighborhood
Comprehensive Plan 2040
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INTRODUCTION
This Chapter evaluates Brooklyn Center’s existing housing stock and plans for future
housing needs based on household projections, population projections, and identified needs
communicated through this planning process. As required in the City’s 2015 System Statement
prepared by the Metropolitan Council, understanding and planning for the City’s housing
stock is a critical part of the 2040 Comprehensive Plan (Plan). The City’s planned land use
includes three residential categories and residential components of new mixed-use designations
which together account for approximately half of the City’s land use area. Residential land use
will continue to be the largest land use in the community. A diverse housing stock that offers
neighborhood stability combined with access to open space, goods and services is essential to
a healthy, sustainable, and resilient community. It protects the community’s tax base against
market fluctuations; it builds community pride and engagement of existing residents; it helps
the community’s economic competitiveness by assisting Brooklyn Center businesses with
employee attraction and retention; it provides options for existing residents to remain in the
community should their life circumstances (e.g., aging-in-place) change; and it offers future
residents access to amenities and levels of service that support a stable and supportive housing
and neighborhood environment.
The first part of this Chapter focuses on the existing housing stock. It summarizes important
information regarding the overall number of housing units, the type of units, their affordability,
and the profile of their residents. These sections are a summary of more detailed socio-economic
data which is attached to this Plan as an Appendix and serves as a supporting resource to this
Chapter. Understanding the existing housing stock is key to determining what types of housing
products may be demanded over the next 10-20 years and where they should be located.
In conjunction to the statistical or inventory information collected, this Chapter includes
a summary of community, stakeholder and policy-maker feedback related to housing and
neighborhoods heard throughout this planning process. Additionally, this Chapter addresses
the projected housing needs during the planning period and presents some neighborhood and
housing aspirations as identified by the City’s residents and policy-makers. The final section
of this Chapter links projected housing need to practical implementation tools to help the
City achieve its housing goals and identified strategies. The list contained in this Chapter is
not exhaustive but provides a starting place from which the City can continue to expand and
consider opportunities to meet current and future resident needs.
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ASSESSMENT OF EXISTING HOUSING SUPPLY
Overview of Brooklyn Center’s Residential Neighborhoods
The City of Brooklyn Center’s residential neighborhoods are diverse and include a variety of
housing types from single-family neighborhoods to large-scale apartment complexes. Although
the City originally incorporated as a village in 1911, it wasn’t until the Post-World War II era
that the City began to develop on a large scale in which entire blocks and neighborhoods were
constructed with tract housing, suburban streets, and neighborhood parks. Like much of the
region’s first ring suburbs, Brooklyn Center took on the role of a typical bedroom community
where residents could get to their jobs in the downtown, stop for groceries at the retail center,
and go home and park their cars in their garages for the evening. This pattern of development
can be seen throughout the region, but Brooklyn Center had one significant difference for
many decades – the regional mall known as Brookdale. The prominence of the mall and its
surrounding commercial district played a major role in how neighborhoods were built and
developed, which influenced neighborhood patterns and housing types.
Even though the mall is now gone, it continues to have lasting effects on the existing housing
types and neighborhoods and will influence future housing as described in subsequent
sections of this Chapter. For example, in the decades that the mall and regional retail center
was operational much of Brooklyn Center’s multi-family and apartment development was
concentrated near the mall and its surrounding commercial district and provided a transition to
the surrounding single-family neighborhoods. Therefore, even though the mall no longer exists,
the apartments developed around the periphery of its retail area in the 1960s continue to be in
high demand and provide a critical source of housing for many households.
2040 Housing & Neighborhood Goals
»Promote a diverse housing stock that provides safe, stable, and
accessible housing options to all of Brooklyn Center’s residents.
»Recognize and identify ways to match Brooklyn Center’s housing
with the City’s changing demographics.
»Explore opportunities to improve the City’s housing policies and
ordinances to make them more responsive to current and future
residents.
»Maintain the existing housing stock in primarily single-family
neighborhoods through proper ordinances, incentive programs and
enforcement.
»Explore opportunities to incorporate new affordable housing into
redevelopment areas that promote safe, secure and economically
diverse neighborhoods.
* Supporting Strategies found in Chapter 2: Vision, Goals and Strategies
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While related to housing age, the size or square footage of single-family homes also plays a
significant role in the demographics of a community. Changes to family structure, technology,
and other factors alter housing preferences over time, which can lead to functional obsolescence
of homes and result in reduced home values because they no longer meet current buyers’
expectations. Brooklyn Center’s single-family housing stock is fairly homogeneous and the
overwhelming majority of homes in every neighborhood are less than 1,500 square feet – and
in many areas less than 1,000 square feet. This is a relatively modest single-family housing size,
and, therefore, the single-family housing stock lacks diversity, which results in lack of choice
for current and prospective residents. At the same time, these homes offer an option for small
families, single and two-person households, and first time homebuyers.
Because the majority of the City’s single-family housing stock is relatively small, older, and of
a homogeneous type as compared to newer larger homes or neighborhoods with more housing
variety, housing prices in Brooklyn Center tend to be affordable. Also, given the similar age, size
and styles of many of the homes, housing in the community has a fairly consistent price-per-
square foot. Affordability in the existing housing stock can be a positive attribute that has the
potential to provide long-term stability to residents and neighborhoods. However, as shown in
the Background Report residents of Brooklyn Center also tend to have lower median household
incomes, which can mean residents may struggle to pay for large-scale capital investments in
their homes such as replacing windows or a roof.
Additionally, within the region some communities with similar single-family stock to Brooklyn
Center have experienced pressure for tear-downs and major remodeling, and that market
trend has yet to reach the City. While that trend may eventually impact the community, at
the present time the change and growth impacting the single-family neighborhoods is mostly
related to the evolving demographics within the community. This change presents different
considerations and challenges
because it is not necessarily physical
growth or changes to homes
and neighborhoods. Instead the
community is challenged with
how to manage larger numbers of
people living within a household
such as growing numbers of multi-
generational households.
The following sections identify and inventory the existing housing stock in the community
including single-family, attached and apartment uses. Each of these housing types serve a
different role in the community, but each type is an important part of the City’s neighborhoods.
A summary of the City’s existing residential types and neighborhoods are as follows:
Single-Family Residential
Single-family residential neighborhoods are the dominant land use within the City and single-
family detached homes comprise nearly 63 percent of the City’s housing stock. The City’s
single-family detached neighborhoods were developed surrounding higher density and higher
intensity land uses that included the former regional retail center and the major freeway
corridors of I-94 and Highway 100. Most of the single-family neighborhoods are developed on
a grid system with traditional ‘urban’ size lots. Exceptions of some larger lots are interspersed
within the traditional block pattern and along the Mississippi River where a pocket of residents
have views and/or frontage of the river corridor.
The 1950s were the peak decade for housing construction in the City; a period in which owner-
occupied housing predominated. While other housing types began to emerge post 1950s, the
demand for single-family detached housing continued through 1980 as the remaining land
in the community developed. Given the period in which the majority of Brooklyn Center’s
housing stock was built, nearly the entire single-family detached housing stock is more than 40
years old. This is a major concern because at 40 years of age exterior components of a building
including siding, windows, and roofs often need to be replaced to protect its structural integrity.
Because the City became mostly built-out by the late 1970s, nearly all of the City’s housing
stock falls into this category, which means the City must be cognizant of potential issues and
proactively monitor the situation to ensure neighborhoods are sustainable into the future.
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Multi-family Residential
Nearly one third (29 percent) of the City’s housing units are in multi-family residential
buildings located throughout the community. Nearly all of these buildings were constructed
in the 1960s and 1970s, and are primarily located on major roadways or corridors, and
surrounding the former regional retail areas. This means these buildings are nearly 50 years old
or older. Just as noted within the single-family neighborhoods, the potential for deterioration
and need for significant investment in these aging buildings can pose a threat to the quality of
the City’s housing stock if the buildings are not properly maintained, managed and updated.
There has been some maintenance and
management of the multi-family housing
stock, and a few complexes have even
incorporated modest upgrades to the
interiors. In fact, the City has started one
large-scale rehabilitation of a building
that would bring higher-market rate rental
options to the community once completed.
However, this is one project and despite
these improvements the City’s multi-family
housing stock continues to be one of the
most affordable in the region with some of
the lowest rental rates in the metropolitan
area.
Many of the multi-family areas are near
major corridors and are adjacent to high
intensity uses that do not necessarily
support or serve the residential use with the
current development and land use patterns.
As a result, many of the multi-family areas
do not feel like an incorporated part of
the City’s neighborhoods. As discussed in
subsequent sections of this Chapter, the
City is planning for redevelopment in or
adjacent to many of the existing multi-
family areas that will hopefully reinvigorate
and reconnect the existing multi-family
uses into a larger neighborhood context.
Existing Single-family Neighborhood Perspectives Described in this Planning Process
Throughout this planning process policy-makers and residents alike expressed the desire to
maintain the affordability of the existing single-family neighborhoods but acknowledged the
current challenges of helping residents maintain their structures, blocks and neighborhoods in
the face of compounding maintenance due to the age of the City’s neighborhoods. In addition
to the physical condition of the structures, residents and policy-makers also acknowledged that
as the City’s population and demographics become increasingly more diverse new residents are
changing how existing homes are being occupied and, therefore, it would be valuable for the
City to evaluate it’s ordinances and policies to ensure they align with the needs of residents.
The demographic considerations are identified in subsequent sections of this Chapter, but it
is worth noting that the demographic changes can have a significant impact the character of
existing single-family residential neighborhoods. Most recognized this as a positive change, but
also acknowledged and stated that the City must figure out how to pro-actively address some
of these changes to protect the existing neighborhood fabric. For example, multi-generational
households are becoming increasingly more prevalent within the City’s single-family
neighborhoods which can impact how rooms within a home are used, how many cars may be
present at the home, and how outdoor spaces and yards may be used.
Closely related to the demographic changes in the community is the City’s aspiration to
promote and maintain neighborhood stability. This objective emerged repeatedly throughout
this planning process as residents and policy-makers expressed the desire to identify strategies to
help promote and encourage sustainability, resiliency and accessibility within the single-family
neighborhoods. In part this objective is the result of several years of turnover within the single-
family neighborhoods as long-term residents begin to age and move onto other housing options,
new residents and families are moving into the neighborhoods. This life-cycle of housing is
common, but the City wants to find ways to ensure new residents want to stay in their homes,
their neighborhoods, and the community long-term and invest in making the City a better place
for generations to come.
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Housing Stock Statistics
The following existing housing stock characteristics support the previous neighborhood
descriptions through more detail. This information, coupled with the previous description,
provides a valuable baseline from which the City can evaluate and plan for the future of its
housing stock.
Total Housing Units
According to data from the Metropolitan
Council and the City of Brooklyn Center,
there are 11,603 housing units in Brooklyn
Center as of 2017. As a fully developed
community, new residential development in
Brooklyn Center has been limited since the
late 1980s. According to the Metropolitan
Council, around 100 new housing units
have been built since 2000 and these homes
were primarily small infill locations or small
redevelopment opportunities.
Housing Tenure (Owned and Rented Units)
Nearly 40 percent of the community’s residents rent, and the majority of those renters live in
apartment buildings which are integrated throughout the community. The Background Report
in the Appendix includes maps illustrating the location of rental housing and demographics of
renters. Given that a significant portion of the City’s population lives in apartments, the age of
such structures becomes critically important
to the overall health of the housing supply.
The majority of the apartments were
constructed prior to 1979 with the bulk of
the units being constructed between 1966
and 1969. This means that the majority of
the apartments is more than 50 years old,
and that structural deficiencies and major
capital improvements may be required in
the relatively near term in order for the
structures to remain marketable.
Multifamily Neighborhood Perspectives Described in this Planning Process
Throughout this planning process the City’s residents were vocal about the existing multi-family
options available in the community and the lack of diversity within the multi-family housing
stock. Without a full inventory of all available multi-family units it is difficult to confirm some
of the anecdotal comments heard throughout the process, but nevertheless it is important to
consider since residents’ testimony provides valuable insight into the existing housing stock.
Several residents indicated that there are few options available for larger multi-family units with
at least three (3) bedrooms, making it difficult to find stable living options for families with
more than two (2) children. Residents also communicated a desire to have housing options that
were closer to supportive retail, commercial and services so that they could walk, bike or easily
use transit to meet their needs. Despite these challenges, the City’s parks, trails and open spaces
were viewed as an integral and important part of their quality of life.
Similarly, to the single-family neighborhoods, the community’s aspiration to create a stable,
accessible, and economically diverse multi-family housing stock was established as a short and
long-term priority. Though not discussed at length during this planning process, it is widely
known and understood that resident turnover, including evictions, is a serious problem that
is most concentrated within the multi-family neighborhoods of the City. While this Chapter
does not attempt to fully evaluate the causes for turnover and eviction in these neighborhoods,
it does acknowledge it as a significant challenge and issue which shapes the character of these
areas of the community. Turnover, including evictions, changes how residents feel about the
community whether the City is directly involved or not. It has lasting affects on how safe people
feel within a community, how invested in an area they want to become and how willing they
are to contribute and reinvest in the City. For these reasons, it is imperative that the City tackle
these issues and create a more stable, and integrated living environment so all residents feel a
part of a neighborhood, and the larger community.
11,603 Brooklyn Center
housing units as of February 2017
- Sources: Metropolitan Council
40% of community residents
are renters
- Sources: Metropolitan Council; US Census; SHC
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Approximately 86 percent of Brooklyn Center’s housing stock (over 10,000 units) is more than
40 years old. This is an overwhelming portion of the City’s housing, and it is therefore important
to track the condition of these older homes as they are at-risk of deferred maintenance. This can
rapidly result in critical structural problems. At the same time, well-maintained older housing can
be an important source of entry-level housing because of its relative affordability when compared
to newer construction.
Table 4-1. Year Built
Housing Type
Related to housing tenure is housing type. Due to
Brooklyn Center’s peak time of housing development in
the 1950s, the housing type is predominantly single-family
detached homes. As of 2017, there are 8,270 units (71
percent) of single-family housing (attached and detached)
and 3,333 (29 percent) classified as multi-family housing.
The type of housing structure can influence not only
affordability but also overall livability. Having a range of
housing structures can provide residents of a community
options that best meet their needs as they shift from one
life stage to another. For example, retirees often desire
multi-family housing not only for the ease of maintenance, but also for security reasons. Multifamily
residences are less susceptible to home maintenance issues or burglary concerns because of on-site
management. For those with health concerns, multi-family residences often have neighbors that can also
provide oversight should an acute health problem occur.
The majority (63 percent) of Brooklyn Center’s housing stock consists of detached single-family homes.
This is above the proportion found in Hennepin County (55 percent) or throughout the metropolitan
area (59 percent). Nevertheless, the City’s housing stock is diversified, with many multi-family units in
large structures, as well as a significant number of single-family attached units. More detailed data are
included in the Background Report in the Appendix.
Year Built
The age of the housing stock is an important characteristic of the community particularly as it relates
to potential structural obsolescence and other limiting factors which correlate to housing values. As
described earlier, much of Brooklyn Center’s single-family housing stock was developed post-World
War II between 1950 and 1963 and many of the homes in this age range were dominated by rambler
architectural styles. As shown on Map 15, entire neighborhoods were all constructed in a relatively
short period of time which strongly defines a neighborhood pattern. As shown, most of Brooklyn
Center was developed on a fairly regular grid pattern and does not reflect a ‘suburban’ development
pattern. This is positive from the perspective that transportation and transit connections should be
easier to improve, where necessary, because of the relatively dense population of the neighborhoods.
However, aging neighborhoods can present a challenge as major systems (i.e. roof, siding, windows,
HVAC, etc.) reach the end of their useful life. This can be particularly difficult if residents are unable
to reinvest and maintain their properties, which leads to deferred maintenance and the potential for
more significant problems that would become widespread across entire neighborhoods.
71% of housing units are
single-family
- Sources: Metropolitan Council;
US Census; SHC
86% of housing stock is
more than 40 years old
- Sources: US Census; SHC
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Map 4-1. Estimated Market Value of Owner-Occupied Housing Housing Affordability
The Metropolitan Council considers housing affordable when low-income households are spending
no more than 30 percent of their income on housing costs. Households are considered low-income if
their income is at or below 80 percent of the metropolitan area’s median income (AMI).
The housing stock in Brooklyn Center is affordable relative to other communities in the Twin
Cities region. According to the Metropolitan Council, 93 percent of the housing units in 2017
in Brooklyn Center were considered affordable. Moreover, only a small portion (5 percent) of
this housing is publicly subsidized. Therefore, most housing is privately-owned and pricing
is set by the market. According to the Minneapolis Area Association of Realtors, there were
480 home sales in Brooklyn Center in 2017 with a median sales price of $186,125. This was
roughly 25 percent lower than the Metro Area median sales price of $247,900. For rental
housing, according to CoStar, a national provider of real estate data, the average monthly rent
for a market rate apartment in Brooklyn Center in 2017 was $981 compared to the Metro Area
average of $1,190.Brooklyn
Center
Broo klyn Park
Columbia
Heights
Crystal
Fridley
Robbinsdale
Minneapolis
-
Owner-Occupied Housing by Estimated Market Value
1/5/2018
.1 in = 0.55 miles
Brooklyn Center
County Boundaries
City and Township Boundaries
Streets
Lakes and Rivers
Owner-Occupied Housing
Estimated Market Value, 2016
$243,500 or Less
$243,501 to $350,000
$350,001 to $450,000
Over $450,000
Source: MetroGIS Regional Parcel Dataset,
2016 estimated market values for taxes payable
in 2017.
Note: Estimated Market Value includes only
homesteaded units with a building on the parcel.
$186,125
2017 median home sale price
in Brooklyn Center
$247,900
2017 median home sale price
in the Metro Area
- Source: Minneapolis Area Association of Realtors,
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The high rate of affordability is largely due to the prevalence of smaller and older homes in the
single-family neighborhoods, and the age and level of improvements within the multi-family
rental neighborhoods. Such small sized properties are typically less expensive because they
have significantly less living space than newer homes (average construction square footage has
increased each decade since the 1950s). Age and level of update and improvements within the
apartment stock, coupled with the average number of bedrooms in the rental units is impacting
the relative affordability of the multi-family units. The condition in both the single-family
and multi-family housing stock is what is known as Naturally Occurring Affordable Housing
(NOAH), because the physical characteristics of the properties are what makes them affordable
rather than the affordability being established through a legally binding contract. Although there
is a high rate of affordability for existing units, the Metropolitan Council identifies a need for
additional affordable units in any new housing construction added to the community through
2040. This condition would most likely be achieved by a legally binding contract, or some other
financing mechanism as new affordable housing product would be difficult to achieve without
some assistance given construction and land costs. Of the 2,258 projected new housing units, the
Metropolitan Council establishes a need of 238 units to be affordable to households at or below
80 percent AMI to satisfy the regional share of affordable housing.
Although nearly all of Brooklyn Center’s housing stock essentially fits within the criteria as
naturally occurring affordable housing, there are some observable trends that would suggest
the price of housing in Brooklyn Center could rise in the coming years. Most recently in 2018
the City’s for-sale housing median home sales price surpassed the pre-bust pricing. While the
median remains below the regional median, it does indicate growing demand and increased
pricing. Significant areas of redevelopment identified on the Future Land Use Plan, including
the former regional mall (Brookdale) location, present opportunities for higher-market rates for
new housing added. These opportunities have the potential to create a more economically diverse
housing stock within the City, which is relatively homogeneous at the time this Plan is written.
Given these opportunities, it is important to continue to monitor the City’s NOAH stock, and
to evaluate and establish policies to incorporate legally binding and protected affordable housing
as redevelopment occurs. This is a careful balancing act that requires concerted and direct
monitoring, study, and evaluation in order to ensure an economically diverse, sustainable and
resilient housing stock for the long-term success of the community.
Table 4-2. Existing Housing Assessment
Total Housing Units1 11,608
Affordability2
Units affordable to households with
income at or below 30% of AMI
Units affordable to households
with income 31% to 50% of AMI
Units affordable to households with income
51% to 80% of AMI
460 4,451 6,029
Tenure3
Ownership Units Rental Units
6,911 4,697
Type1
Single-family Units Multifamily Units Manufactured Homes Other Housing
Units
8,275 3,333 0 0
Publicly Subsidized Units4
All publicly subsidized units Publicly subsidized senior units Publicly subsidized units
for people with disabilities
Publicly
subsidized units:
all others
553 22 0 531
Housing Cost Burdened Households5
Income at or below 30% of AMI Income 31% to 50% of AMI Income 51% to 80% AMI
1,691 1,406 895
1 Metropolitan Council, 2016 housing sock estimate. Single-family units include single-family detached homes and townhomes. Multifamily units include units in duplex, triplex, and
quadplex buildings as well as those in buildings with five or more units.
2 Metropolitan Council staff estimates for 2016 based on 2016 and 2017 MetroGIS Regional Parcel Datasets (ownership units), 2010-2014 Comprehensive Housing
Affordability Strategy data from HUD (rental units and household income), and the Council’s 2016 Manufactured Housing Parks Survey (manufactured homes). Counts from
these datasets were adjusted to better match the Council’s estimates of housing units and households in 2016 as well as more current tenure, affordability, and income
data from eh American Community Survey, home value data from the Federal Housing Finance Agency, and rents from HousingLink’s Twin Cities Rental Revue data.
3 US Census Bureau, 2012-2016 American Community Survey five-year estimates; counts adjusted to better match the Council’s 2016 housing stock estimates.
4 Source: HousingLink Streams data (covers projects whose financing closed by December 2016)
5 Housing cost burden refers to households whose housing costs are at least 30% of their income. Source: US Department of Housing and Urban Development, 2010-
2014 Comprehensive Housing Affordability Strategy (CHAS) data, with counts adjusted to better match Metropolitan Council 2016 household estimates.
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Cost Burdened Households
Cost burden is the proportion of household income spent toward housing and utilities. When
lower income households spend more than 30 percent of their income toward housing and
utilities this burden is considered excessive because it begins to limit the money available for
other essentials such as food, clothing, transportation, and healthcare. According to data from
the Metropolitan Council, 4,114 (35 percent) Brooklyn Center households at or below 80
percent average median income (AMI) are considered cost-burdened which means they spend
more than 30 percent of household income on housing costs. This percentage is well above
the metro area rate of 23 percent. Half of these Brooklyn Center households are lower income
households who earn at or less than 30 percent AMI. The high incidence of cost burdened
households is correlated with younger wage earners, lower-wage jobs, and a high proportion of
older households, many of which are in retirement and no longer working.
FUTURE HOUSING OPPORTUNITIES
Projected Housing Need
As referenced in Chapter 3: Land Use & Redevelopment and the following Table 4-4, the
Metropolitan Council’s 2015 System Statement forecasts that Brooklyn Center will add
approximately 4,169 new residents and 2,258 new households through 2040 and identifies the
following affordable housing allocation to be accommodated between 2020 and 2030.
Table 4-3. Affordable Housing Need Allocation
At or below 30% AMI 103
31 to 50% AMI 0
51 to 80% AMI 135
Total Units 238
Source: 2015 System Statement - Metropolitan Council
Housing Challenges inform Housing Needs
The Metropolitan Council’s System Statement identifies approximately 10% of the planned
housing units for some level of affordability as identified in Table 4-3. As described in other
chapters of this Plan, for the first time since the post-World War II housing boom the City
is expected to add a significant number of new households. These new households have the
opportunity to provide a more diverse housing stock, and add to the options of available for
existing and new residents in the community. Redevelopment can reinvigorate and revive
KEY DEMOGRAPHICS
Age Profile of the Population
The age profile of a community has important ramifications on demand for housing, goods
and services, and social cohesion. Tables and figures illustrating the City’s age distribution are
presented in the Background Report in the Appendix. Unlike the broader region, in which the
population continues to age rapidly, Brooklyn Center’s population grew younger between 2000
and 2010, and has stayed relatively stable since 2010. This is largely due to a significant increase
in people age 25 to 34, many of which are starting families and having children. Increases in
the number of young families place demands on schools, housing affordability, and the types of
retail goods and services needed.
The median age of residents in Brooklyn Center in 2016 was 32.8, which is consistent with
the 2010 median age of 32.6. This is younger than 2000 when the median ages was 35.3. With
such a young population, it is expected housing units may turn over more frequently. But, as
of 2016, more than 60 percent all households have been living in their homes for more than
five (5) years. More data about geographic mobility of households is found in the Background
Report in the Appendix.
Household & Family Type
Changing family and household structures can
also have a profound effect on housing and
other community needs. For example, decreasing
household size has a direct impact on the amount
of housing a household needs. As mentioned, the
presence of children not only impacts local schools
and parks, but also the types of retailers that can be
supported and the nature of housing demanded.
Since 2010, the number of households with children
in both single-parent and married couple households
has been growing significantly. Meanwhile, the
trend among households without children, especially
married couples (i.e., empty-nesters) has been on the
decline. The percentage of households with children
is approaching 40 percent, which is well above the
rate in the County and the metro area.
32.8 Median age of
Brooklyn Center residents
- Sources: US Census, SHC
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• The City has discussed developing a more formal housing action plan to better
understand the needs of its residents. The plan would work to better understand
cost-burdened households, eviction rates and policies, home-ownership racial
disparities, and gaps in the housing stock.
• Continuing to revise, enhance and modify its policies and ordinance to respond to
residents needs. This includes monitoring best-practices in the region, being agile
and open to changes and enhancements. As an example of this type of ordinance
or policy response the City recently adopted a Tenant Protection Ordinance that is
aimed and protecting the City’s residents ability to maintain stable, safe housing.
The City’s projected housing needs are complex, and are likely to become more complicated
as redevelopment occurs. However, the City intends to continue to prioritize discussion
and action around creating safe and stable housing throughout the City. The following
sections specifically address the new housing expected to be develop in this planning period.
The new and redevelopment areas should be considered collectively with the City’s existing
neighborhoods to ensure an incorporated, integrated approach to the City’s neighborhoods is
achieved to create a dynamic community for generations to come.
areas of the community with vibrant, experience-rich areas that will benefit everyone in the
community. The City is excited for redevelopment to create a dynamic central hub of activity
in the community, but also acknowledges that it must be balanced with strong assessment,
planning and appropriate protection of its existing housing stock to ensure neighborhood
sustainability and stability in all areas of the community.
New housing stock brings the possibility of adverse impacts to existing single-family and
multi-family properties if proactive steps are not taken to protect existing naturally occurring
affordable housing (NOAH), single-family neighborhoods, and multi-family properties.
The City’s policy makers throughout this process discussed and acknowledged that bringing
new market-rate, amenity rich housing products could have deleterious affects specifically
on existing naturally occurring affordable housing if a plan to protect affordability is not
implemented. This is a huge concern as resident stability through access to safe and healthy
housing is one of the City’s adopted strategic priorities. If proper tools are not in place there are
no protections to keep rents reasonable for residents and to maintain reasonably priced for-sale
housing as redevelopment takes holds.
One of the positive aspects of the City’s identified redevelopment areas is that the land proposed
for redevelopment does not contain existing housing. In a fully-development community this
is unusual for a large redevelopment area, and is positive because no residents will be displaced
as a result of the City’s redevelopment aspirations. However, even though residents will not be
displaced directly, indirectly, redevelopment could increase the desirability of activities such as
flipping single-family homes and converting NOAH multi-family properties for higher-rents.
To address some of these concerns an extensive list of high-level tools have been outlined
in Table 4-5 of this Chapter. The City recognizes that this chapter is only the start of an
ongoing conversation, and it is the City’s policy-makers intent to continue to be proactive,
and to collaborate with non-profits and advocate for a broader regional approach to housing
affordability. In addition to the tools identified in Table 4-5, the City is also continuing
conversations about:
• Viability of a non-discrimination ordinance related to Section 8 acceptance.
Adjacent Cities, including Minneapolis, have attempted to include ordinances in
their tool-kit addressing this issue. While the issue is currently in court, Brooklyn
Center will continue to monitor the process and may consider adoption of a
similar ordinance depending on its outcome.
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Future Residential Uses in Planned [Re] Development Opportunity Areas
Transit-Oriented Development (TOD)
Transit-Oriented Development (TOD) is a new land use and redevelopment concept in the City
that focuses on existing and planned transit as a major amenity and catalyst for redevelopment.
While previous planning efforts have acknowledged the presence of transit in the community, none
have embraced it as an opportunity for redevelopment. As this portion of the City redevelops,
the location of future transit enhancements has the potential to attract significant new housing
development. Therefore, this is where guided densities are the highest. This is purposeful because
the area has exceptional visibility and access from Highway 100 and I-94, and will be served by two
transit stops (one being a transit hub) for the C-Line Bus Rapid Transit (BRT) and the potential
future D-Line BRT. The C-Line BRT is planned to open in 2019 and will mimic the operations
of LRT (light rail transit), offering frequent transit service that will connect residents to the larger
region. To best support the C-Line, and future D-Line, the City has planned to reinvigorate
and re-imagine this central area of the community as a more livable, walkable, and connected
neighborhood within the City. In addition, the potential for desirable views of Downtown
Minneapolis could result in pressure to build taller structures in this area. Any development of
this area should also be seen as an opportunity to support commercial users, improve multi-modal
service and access, and allow safe, pleasant, and walkable connections to transit, parks, and other
community destinations.
As this area evolves, the desirability of this area as an amenity-rich livable area is likely to improve.
As change occurs, the housing within the area is likely to be at market rates adding to a more
economically diverse housing stock than is currently available in the community. This would add
more housing choices in Brooklyn Center, and it could also support a mix of both market rate
and affordable units; provided proper policies are developed to ensure legally binding affordable
housing is incorporated into development plans. Communities oftentimes explore policies such as
inclusionary zoning as redevelopment accelerates which may become an appropriate consideration
in the future, but is likely not to be the best approach given current market conditions. However,
in the future if significant increases in the market occur it
may warrant further discussion in the City. Regardless of the
policy tool (whether regulatory or incentive based) selected,
consideration will need to be given to working with any future
developer in a possible partnership with the City to help deliver
affordable units as part of redevelopment. As described within
the Chapter 9: Implementation, the City will continue to explore
proper methodology and policies to ensure an economically
diverse housing stock is created as housing continues to evolve in
the community.
New Housing Opportunities in this Planning Period
Recognizing that the land use plan for Brooklyn Center identifies several key areas that are
envisioned for new development or redevelopment, this will result in an opportunity to
accommodate more housing and increase the City’s number of households. Based on guided
residential densities in the development opportunity areas, the City can accommodate the
Metropolitan Council’s forecasted households as well as meet the allocated affordable units as
shown in Table 4-3 above. As indicated in the Land Use Chapter, depending on how the market
responds to these redevelopment areas the City could accommodate anywhere between 2,658
and 3,836 new households by 2040 (Chapter 3: Table 3-5, repeated in the following Table 4-4).
Table 4-4. Future Land Use Densities and Projected Acres, Households & Population
Future Land
Use Density (DU/A)2020 Acres
(Res)b HH Popc 2030 Acres
(Res)b HH Popc
Transit Orient
Development
31.01-130
DU/A 9 279 619 26 814 1,807
Neighborhood
Mixed-Use
15.01-31
DU/A 13 195 433 19 285 632
Commercial
Mixed Use
10.01 – 25
DU/A 8 80 178 15 150 333
High Density
Residential
15.01-31
DU/A 212 3,180 7,060 212 3,180 7,060
TOTAL ----3,734 8,290 --4,429 9,832
Source: Metropolitan Council, Thrive 2040 Brooklyn Center 2015 System Statement, SHC.
a Acreages assume that some recently redeveloped areas within these land use designations will not experience
redevelopment until post-2040 and therefore households are not calculated. Please refer to Map 3-3 that identifies
areas planned for change within this planning period.
b Note, there are existing households in each of the designations today that would be re-guided for potential
redevelopment in the future. This accounts for existing households and those that my potentially develop over the
next two years.
c Calculation multiplies households by 2.22 persons per household (According to the 2016 ACS (Census), for multi-
family units (5+ units in structure)
There are three large districts identified in the City with guided land use that allows for
significant potential of new development and redevelopment through 2040. These areas have
the potential to greatly expand Brooklyn Center’s current housing numbers and choices.
Moreover, each opportunity area has the potential to not only provide new forms and types of
housing but to catalyze or rejuvenate investment into the City resulting in stronger linkages
between neighborhoods and districts that are currently isolated from one another. The following
section discusses these areas further.
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Commercial Mixed-Use Areas
The Commercial Mixed-Use areas generally surround the TOD area and are contemplated for large-
scale redevelopment but are equally as focused on supporting business and office users. These areas are
generally within one mile of the transit station that serves as a major hub for regional and local transit
services, and therefore new housing will still have opportunities to capitalize on this as an amenity.
Slightly less dense than the TOD district, these areas may provide exceptional opportunities to introduce
multi-family uses such as town homes, row homes, and small lot single-family uses that could cater
to larger families and incorporate more units with three or more bedrooms. As indicated in previous
sections of this Chapter, the City’s residents expressed a desire to have access to more rental units with
more bedrooms and larger square footages. While a detailed market study would likely be needed to
confirm the demand for these uses, if we can take the anecdotal information as true, this area has the
potential to support those types of uses. As with the TOD district, affordability is likely to become a
consideration in any redevelopment within these areas because new construction naturally costs more
and as the area redevelops interest and demand is likely to escalate costs. It is therefore important, just
as with the redevelopment of the TOD district, that the City evaluate and explore ways to incorporate a
range of affordable and market rate opportunities in new developments.
Neighborhood Mixed-Use Areas
The Neighborhood Mixed-Use is a new land use designation that responds to resident and policy-makers
desire to incorporate retail and services into the neighborhood fabric. One of the ways the City can
accomplish that objective is to create ‘nodes’ of mixed-uses that include residential uses, but protect
key corners for small retailers, shops, or restaurants that create a more vibrant streetscape. The City
acknowledges that these areas are less likely to redevelop with any regularity. Therefore, the number
of new housing units expected to come on-line in these areas is a little less tangible than in areas with
large contiguous redevelopment acres. However, the nodes have the opportunity to provide yet another
housing style and type, as these areas are not envisioned for large high-rises or extensive master plans.
Instead, these areas are contemplated to have smaller footprints with living units above a small store
front or restaurant for example.
HOUSING RESOURCES, STRATEGIES & TOOLS
Table 4-5 outlines a variety of resources, strategies, and tools to implement Brooklyn Center’s
identified housing needs and stated housing goals. There is a wealth of resources available to
assist communities in meeting their goals. The following table should be considered a starting
point. As the City’s housing needs evolve or become clearer, this set of tools should expand with
options.
Table 4-5. Housing Resources, Strategies & Tools
Housing Goal
Tool/
Resource/
Strategy
Description Affordability
Target
Promote a diverse
stock that provides
opportunities for
all income levels
Housing
Demand
Market Study
Conduct a market study and gaps analysis to track housing
demand. This study and report could double as a marketing
and promotional piece about housing opportunities.
<30% AMI
51-80% AMI
HRA/CDA/
EDA
Work with the County HRA and City EDA to protect and
enhance existing NOAH in the City. Use Market Studies
to help identify opportunities to meet housing needs in the
City and evaluate ways to partner with the County and
other program providers.
<30% AMI
30-50% AMI
51-80%
Site
Assembly
Consider strategies for assembling sites in high-density
or mixed-use districts that would increase appeal to
developers.
<30% AMI
51-80% AMI
CDBG
Work with Hennepin County to use CDBG funds to help
low-and moderate-income homeowners with rehabilitation
assistance. CDBG funds will also be explored for use
to support redevelopment efforts that meet the City’s
goals towards a diverse housing stock (units and market/
affordable diversity).
<30% AMI
51-80% AMI
Tax
Abatement
Consider tax abatement for large rental project proposals
that provide unit and income-mix within a single project.
The City is particularly interested in projects with market
diversity and units of different size to cater to a larger
market (singles, families, multi-generational, etc).
<30% AMI
51-80% AMI
HOME and
Affordable
Housing
Incentive
Fund
Consider application, and utilization, of HOME and
Affordable Housing Incentive fund grants to support a
diverse housing stock. The City will prioritize projects that
include a unit size and income mix that meets the needs of
single-person and families in the City.
<30% AMI
30-50% AMI
Housing
Bonds
The City would consider issuing Housing Bonds for projects
that include units for large families, particularly in projects
with a mix of unit sizes and incomes. However, it should be
noted that there are limitations to the city bonding authority
and other programs may be more suitable
<30% AMI
51-80% AMI
Brownfield
Clean-up
In potential redevelopment areas, explore EPA and MN
DEED grant programs that provide funding and assistance
with planning, assessment, and site clean-up.
<30% AMI
30-50% AMI
51-80%
4D for NOAH
Properties
The City will continue use of 4D classification for the
purpose of protecting its Naturally Occurring Affordable
Housing (NOAH) uses throughout the City.
<30% AMI
30-50% AMI
Pooled TIF
Funds
Explore the use of TIF housing funds to create a revolving
loan program to support the rehabilitation of existing single-
family and multi-family NOAH properties.
<30% AMI
30-50% AMI
51-80%
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Housing Goal
Tool/
Resource/
Strategy
Description Affordability
Target
Identify ways to
match housing
stock with changing
demographic Housing
Coordinator
Position
The City would create a position that would serve as
a liaison to existing landlords to help them respond to
shifting demographics through training and access to city
resources. The position could also serve as a resource
for tenants to connect to support services in the event of
eviction notices, discriminatory practices, and other issues
related to housing access. The position would include
coordinating housing programs, including home ownership
programs, resident financial literacy programs, with the
intent to convert Brooklyn Center renters to successful
home owners.
<30% AMI
30-50% AMI
51-80%
Referrals
Review and update reference procedures and training for
applicable staff including a plan to maintain our ability to
refer residents to any applicable housing programs outside
the scope of local services.
<30% AMI
30-50% AMI
51-80%
Preserve
LIHTC
properties
The City will monitor expiring LIHTC properties and work to
find solutions to protect and preserve these affordable units
to meet the needs and demands of the City’s residents.
The City will approach owners with expiring properties to
discuss the possibility of 4d program tax breaks
<30% AMI
30-50% AMI
Explore
opportunities
to improve City
housing policies
and ordinance
to make more
responsive
Expedited
Application
Process
Streamline the pre-application process in order to minimize
unnecessary delay for projects that address our stated
housing needs, prior to a formal application submittal
<30% AMI
30-50% AMI
51-80%
Fair Housing
Policy
The City will work to incorporate a Fair Housing policy into
its ordinances and policies.
<30% AMI
30-50% AMI
51-80%
Existing
ordinances
The City will continue to operate its Rental Licensing
Program, and will periodically review and make
enhancements to support the City’s residents.
<30% AMI
30-50% AMI
51-80%
Update the
City’s Zoning
to support
new land
uses
The City’s future land use plan provides opportunities
to include high density residential uses in the areas
identified for redevelopment. The City will update its
zoning ordinance, including prepare new zoning districts,
to support the housing needs identified in this Housing
chapter.
<30% AMI
51-80%
Maintain existing
housing stock
in single-family
neighborhoods
through proper
ordinances,
incentives and
enforcement
Foreclosure
Prevention
In established neighborhoods, a rash of foreclosures,
especially in close proximity to one another, can have a
deleterious effect on the surrounding neighborhood. Be
aware of foreclosures and be able to direct homeowners
at-risk of foreclosure to resources that can help prevent
foreclosures. http://www.hocmn.org/
<30% AMI
30-50% AMI
51-80%
Low or No
Cost Home
Loans
Providing low-or no-cost loans to help homeowners repair
heating, plumbing, or electrical systems helps preserve
existing housing. For example, Minnesota Housing’s
Rehabilitation Loan and Emergency Loan programs
make zero percent, deferred loans that are forgivable if
the borrower lives in the home for 30 years. Minnesota
Housing’s Community Fix Up Program offers lower-cost
home improvement loans, often with discounted interest
rates, remodeling advising, or home energy services,
through a trained lender network.
<30% AMI
30-50% AMI
51-80%
Home
Ownership
Program
Work with residents to provide education and programs
to make home ownership possible, particularly converting
existing renters to home owners through supporting down-
payment assistance programs.
30-50% AMI
51-80%
Code
Enforcement
The City will continue to operate a robust code
enforcement program that includes both complaint-based
enforcement and proactive sweeps.
<30% AMI
30-50% AMI
51-80%
Vacant
Building
Program
The City will continue to operate its Vacant Building
Program that tracks and monitors vacant properties in the
City to ensure adequate upkeep and maintenance.
<30% AMI
30-50% AMI
51-80%
Explore
opportunities to
incorporate new
affordable housing
into redevelopment
areas
Inclusionary
Housing
Ordinance
If the market strengthens in redevelopment areas to the
extent that policies would not deter investment, the City
could consider an inclusionary housing ordinance to
ensure that affordable housing is a component of any new
housing development. Since current market conditions
in the City are well below those of adjacent communities,
an inclusionary policy may deter short-term investment.
The City may want to explore this policy in the future if the
market rents rise to levels of at least 80% AMI.
<30% AMI
30-50% AMI
51-80%
Livable
Communities
(LCA
and LCA
LCDA-TOD)
Consider supporting/sponsoring an application to LCDA
programs for multi-family rental proposals in areas guided
for high density residential and targeted to households of
all income levels.
<30% AMI
30-50% AMI
51-80%
Tax
Increment
Financing
(TIF)
To help meet the need for low-income housing, the City
will establish a TIF district in an area guided for TOD and
mixed uses.
<30% AMI
30-50% AMI
51-80%
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Housing Policy Discussion
City Council Work Session, 1/11/2021
Meg Beekman, Community Development Director
Regional Housing Trends
•Twin Cities Metro Area currently experiencing record low vacancy rates
•Midyear report, average vacancy rate across region was 2.3%
•Driven by high demand for rental housing combined with unmet supply
•Effect of low vacancy rates:
•Increased rents
•Increased interest from outside investors in Class B and C rental properties
•Landlords in a position to be choosier about who they rent to
•Reduction in number of landlords accepting Section 8 vouchers
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Brooklyn Center’s Rental Housing
3
Affordable rents in the Twin Cities Metro Area Average rents in Brooklyn Center
•Average rents in Brooklyn Center are considered affordable to those making roughly
50%‐60% of the area median income (AMI)
2040 Housing and Neighborhood
Goals
•Promote a diverse housing stock that provides safe, stable, and accessible housing
options to all of Brooklyn Center’s residents.
•Recognize and identify ways to match Brooklyn Center’s housing with the City’s
changing demographics.
•Explore opportunities to improve the City’s housing policies and ordinances to make
them more responsive to current and future residents.
•Maintain the existing housing stock in primarily single‐family neighborhoods through
proper ordinances, incentive programs and enforcement.
•Explore opportunities to incorporate new affordable housing into redevelopment areas
that promote safe, secure and economically diverse neighborhoods.
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Background
•April 2018 – Council discussed various housing policies
•December 2018 –Adopted Tenant Protection Policy
•March 2020 – Discussed Housing policy work plan
•Fair Housing Policy
•Housing Study
•NOAH Preservation Program
•Mixed Income/Inclusionary Policy
•Tenant Protections
•Single Family Housing Stabilization
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Policy Framework
•Housing Choice
•Conduct housing study: Analyze existing housing stock, current and anticipated market demands
and identify gaps; conduct tenant and homeowner survey
•Affordable Housing Policies ‐fall into one of three categories:
•Creation of new legally‐binding units
•Preservation of NOAH units
•Tenant Protections
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Local Policies
•Inclusionary/Mixed Income
•NOAH Preservation Program
7
Mixed Income Policy
•Collection of policies that require or encourage new affordable units to be included
with new market‐rate residential development
•Frequently in the form of a percentage of units in exchange for public subsidy
•In higher rent markets, a certain percentage of affordable units can be required without increasing
the need for additional public subsidy. This is due to the higher than average market rents, which
off‐set the affordable units.
•Brooklyn Park recently adopted an Inclusionary Housing Policy. Their analysis found that any amount
of included affordable would create a financial gap in the project and require subsidy. The policy
acknowledges this and projects will be looked at on a project by project basis to determine if the
gap can be subsidized.
•An inclusionary housing policy would need to be weighed against other community benefits desired
out of a development
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Mixed Income Policy
•Key Components
•Applicability –When does it apply
Example: All developments that create 10 or more housing units that receive:
•City or EDA financial assistance
•Master or amended P UD (would require a change of city ordinance)
•Zoning Code Amendments (would require a change of city ordinance);
•Or Comprehensive Plan Amendments
•Affordability Requirements –How many units and at what affordability
Example: 5% of units at 30% AMI or 10% at 50% AMI or 15% at 60% AMI or a payment in lieu
•Affordability Period –Duration of requirement
9
Mixed Income Policy
•Key Components
•Distribution of affordable units – Required affordable units to be consistent to market rate units in
quality and intermixed throughout development
•Non‐discrimination –Would prohibit discrimination based on source of rent payment (Housing
Choice Voucher holders)
•Other considerations –Other incentives to reduce financing gaps and encourage providing mixed
income housing
Example –Parking reduction, fee waivers
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Mixed Income Policy
•Financial Impact
•All multi‐family development
likely to experience financial
gap
•Income, rent, and other
restrictions can lead to
financial feasibility challenges
•Restricts level of debt that can
be supported by project
•Provides insufficient
investment returns to attract
equity
•Policy can address projects
on a case by case basis based
on available TIF and other
community/project goals
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Project Example – Mixed-income Housing Policy
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Market Rate Apartment
•Developer proposal to build 174 units of market rate rental housing
•No assistance requested from developer
•City policy requires affordability
•Developer considering 5% of units at 30% AMI
•Affordibility requirement creates a verified financial gap in the project.
13
Market Rate Apartment
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Gap Funding Sources
•Federal low‐income housing tax credits (LIHTC)
•At least 20% of units must be affordable at 50% AMI, or
•At least 40% of units must be affordable at 60% AMI
•Because of competitive nature of application and to maximize credits, LIHTC
projects are usually 100% affordable
•State and County grant source
•Highly competitive and limited resources available
•State loan/mortgage programs
15
Gap Funding Sources
•Local tax increment financing
•For a Housing District, affordability requirements are the same as the tax credit
program
•Redevelopment District is less restrictive
•Local tax abatement
•No income limitations –city policy driven
•Local fee waivers
•Land use/zoning concessions
•Parking reductions
•Density bonuses
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Elevate Apartments – City Goals
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Elevate Apartments – City Goals
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Elevate Apartments – City Goals Met
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Elevate Apartments – City Goals Met
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Mixed-income Policy Implications
•Housing Needs
•Existence, or lack of affordable housing options
•Need for housing choice/diversity (avoid homogeneous housing stock)
•Weigh housing needs against other city goals
•Other goals being achieved by project
•Other community benefits
•Potential cost implications of a policy
•How will it be off‐set
•Long‐term tax base availability
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LIHTC versus Local Funding
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LIHTC versus Local Funding
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NOAH Preservation Program
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Brooklyn Center’s Rental Housing
•37% of Brooklyn Center’s housing stock is rental
•829 properties and 4,340 units
•8 percent of single family properties are rented
•Nearly all of it is considered naturally occurring affordable housing (NOAH)
•All multi‐family constructed between 1961‐1979 – homogeneous
•4.1% of all housing (10.9% of rental) are legally‐binding affordable; this will
go to 6% (17.1) when Sonder House is completed
•425 Section 8 voucher holders (up from 402 in 2018)
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Brooklyn Center’s Rental Housing
•Many renters are on month to month leases
•Tenants report frequent (more than once per year) rent increases
•Rent increases often do not coincide with regional income trends
•Capital improvements in buildings typically coincide with rent increases
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NOAH Preservation Program - Goals
•Prevent displacement
•Stabilize rents in markets where rents are increasing faster than incomes
•Inject capital investment into rental properties without increasing rents
•Tool to adjust for market conditions
27
NOAH Preservation Program
•An incentive program to encourage NOAH property owners into setting aside a
percentage of rental units as legally binding affordable for a set period of time.
•A NOAH preservation fund is created and Staff works with existing property owners to
provide a subsidy for building rehabilitation, which would then be combined with a 4d
tax classification (Can be structured as a matching grant)
•4d properties are taxed at a rate of .75% (approximately 40% discount)
•The result is the preservation of NOAH units through legally binding contract.
•Tax break is proportional to the percentage of units which would be affordable, and not
apply to the entire building.
•Discussions in legislature last year to lower tax classification to .25%
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NOAH Preservation Program
•Key Components
•Applicability –When does it apply
•What size building for minimum eligibility?
Proposal: Rental properties with 5 or more units
•Affordability Requirements –How many units (minimum/maximum) and at what affordability
•A percentage of units throughout the community versus focusing on 100% of units in fewer buildings
Proposal: Minimum of 20% of units, with a maximum of 30% of units, at 50% AMI
•Affordability Period –Duration of requirement
•Amount of subsidy versus length of commitment
Proposal: Minimum of 15 years
•Eligibility –What properties are eligible
•Focus on units that are not experiencing deferred maintenance
Proposal: License type I and IIs only
29
NOAH Preservation Policy
•Key Components
•Incentive Program –Local subsidy to meet state eligibility criteria
Proposal: City pays $150 application fee, matching grant of $1,000 per unit up to $25,000 to be
spent on common area improvements or energy improvements.
•Other –Free building energy assessment, rent increase caps for other tenants
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NOAH Preservation Program
•Current Financial Impact
•Future Financial Impact with Sonder Place
31
•Program goals
•What percentage of existing
rental units should be income
restricted?
•Financial Impact
•471 units are currently income
restricted (in the 4d program)
•270 additional units when Sonder
Housing is completed
•Total of 741 units
NOAH Preservation Program
•Program goals
•What percentage of existing rental units should be income restricted?
•Potential Financial Impact
•Example –Goal of 20% of all rental units income restricted = 868 units
•Estimated savings to landlord/cost to taxpayers to be approximately $600/year per unit
•741 units currently income restricted
•127 more units of 4d = $76,200 annual lost tax revenue
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NOAH Preservation Program
•Next Steps
•Draft NOAH Preservation program based on feedback from Council
•Meet with landlords and gather feedback on program guidelines/incentive package
•Identify potential funding sources for subsidy/matching grant
•Identify opportunities to pilot program roll out with a specific building
•Bring program back to Council for consideration
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Policy Questions
•Mixed‐Income Housing Policy Discussion
•Does the City Council wish to move forward with a mixed‐income housing policy?
•If so:
•When would it apply?
•What affordability options would it offer?
•What duration should it be enforced?
•Are there other incentive that should be considered with the program?
•How would the Council like to address projects that can’t finance the requirement?
•NOAH Preservation Program Discussion
•Does the City Council wish to move forward with a NOAH Preservation program?
•If so:
•What considerations of concerns are there about the draft program?
•What should the initial goals of the program be in terms of percentage of units to include?
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