Nearly two decades ago a fledgling group of business owners and operators founded the Minnesota Coalition for Workforce Housing.
Thanks to the work of leaders in state government and various business and nonprofit organizations, some headway was made at the state level in providing local communities with seed money to help make much needed affordable housing convenient to places of work. In addition to metro governments, Greater Minnesota communities like Marshall and Grand Rapids stepped up because growing local economies needed homes for all.
A broader HousingMinnesota group of several thousand was convened and Governor-elect Tim Pawlenty keynoted a day-long conference in November of 2002, detailing specific housing policy ideas.
What looked to be a good start certainly was insufficient to keep up with housing needs in Minnesota 16 years later. The mismatch between housing costs and too many working families’ ability to afford them had become the state economy’s new crisis.
“The housing crisis and Great Recession are assuredly over” assertion kicked off a three-part series of commentaries published by the Adams Publishing – ECM Editorial Board, spelling out the challenges.
The series examined the contours of the housing problem, its specific impacts on working people and senior citizens, and explored remedies, including public incentives allowing private and nonprofit builders and housing providers to become a part of the solution. Adams-ECM said the state’s economic prosperity had helped expose and exacerbate the shortage of affordable housing.
The Minneapolis-St. Paul metro area had, since 2010, added 83,000 households while building less than 64,000 new homes to accommodate newcomers. A growing number of Minneapolis renter households have been spending more than half of their incomes on housing, data shows, and a growing number of people can’t afford homes at all. Meanwhile, statewide median home values are rising fast, topping $260,000 in July.
Late last year Gov. Mark Dayton formed a “Governor’s Task Force on Housing” to identify possible solutions to the problem of more than one in four households — nearly 550,000 — spending more than 30 percent of their income on housing. The 30 percent figure has long been a widely accepted benchmark of affordability.
Dayton’s bonding proposal — not signed into law — included $100 million for affordable housing projects statewide. (Dayton reports that more than $5 billion in public and private investment helped 325,000 low- and moderate-income households gain affordable housing since he took office in 2011.)
The number of cost-burdened households rose by 58 percent from 2000 to 2016, reports the state’s housing finance agency.
Additionally, according to the March 2017 “State of the State’s Housing” report by the Minnesota Housing Partnership (MHP),
P housing-challenged households must skimp on needs like food, medicine and transportation. According to MHP, “This issue is likely to grow more urgent as the Twin City region’s senior population is expected to grow by 123 percent over the next 20 years - the largest projected increase for any region in the state.”
Minneapolis Mayor Jacob Frey has called the shortage of affordable housing a “historic crisis” for the city and proposes in his $1.55 billion 2019 budget to commit a record-high $40 million in funds to a variety of programs to lower the burden of housing costs.
The investments - which fit within a broader effort to diversify the city’s housing market and accommodate its growing population - range from tenant legal services to tax incentives for landlords to keep rents stable to emergency help. The City Council will have the last say on Frey’s ideas when they finalize the budget in December.
Meanwhile, St. Paul Mayor Melvin Carter’s $606 million budget allocates significant money toward low-income housing - creating a one-time “Housing Trust Fund” of $10 million, plus an additional $2 million annually. That includes $3.6 million to construct rental units targeting tenants making 30 to 50 percent of the area median income, and $3 million for the “inspiring communities” program which acquires and rehabilitates vacant properties, primarily in low-income neighborhoods.
Renters do not escape the housing crisis with nearly half being burdened and nearly a quarter experiencing severe burdens. With more than half of income spent on rent, 43 percent of white renters suffered housing cost burden, compared with 53 percent of renters of color.
The growth of low-wage jobs in Minnesota is expected to create 118,000 new openings by 2024. Among the top six in-demand occupations, only registered nurses and truck drivers will be able to afford fair-market rents for a two-bedroom apartment.
The long-term answer is for family income to increase thus allowing for housing sustainability. By helping families improve their financial standing their ability to afford quality rental units or to buy homes is assured. At the same time, these families become more able to afford life’s necessities and extras, fueling community economies.
Going forward, Adams-ECM proposed that cities and counties especially consider the needs and obstacles that face homeowners and renters.
• Cities should consider some flexibility in their zoning rules, such as allowing smaller units in some areas, or allowing multifamily units in residential areas.
• Cities, counties and the state need to consider tax incentives and grant programs to help builders in developing affordable units throughout our communities.
• Governmental units should review their building requirements to ensure rules are essential and do not put unreasonable burden on home and apartment developers.
• All cities should require some number of affordable units to be included in all developments, or to require builders to contribute to an affordable housing fund.
• A constant business-education-government partnership must exist to train unemployed or underemployed people in our communities to meet the needs of today’s companies.
Adams-ECM concluded the series suggesting that we “all benefit from stronger, healthier, more stable families in our neighborhoods. Home is not only where the heart is – home is the essential base for a quality life.”
An opinion of the Adams Publishing-ECM Editorial Board. The Morrison County Record is part of APG-ECM. Reactions welcome at email@example.com.