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Tenant protections in a tight housing market

Tenant protections in a tight housing market. Affordable housing strategies and tools. Session overview. strategies and tools to address the loss of NOAH, tenant protection and the creation of new affordable housing opportunities how the ordinances and strategies came about

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Tenant protections in a tight housing market

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  1. Tenant protections in a tight housing market Affordable housing strategies and tools

  2. Session overview • strategies and tools to address the loss of NOAH, tenant protection and the creation of new affordable housing opportunities • how the ordinances and strategies came about • the process used to garner community and political support • how stakeholders were engaged • plus the lessons learned and strategies for success  

  3. Background: lack of affordable housing Lack of affordable housing is a universal problem facing many communities throughout MN & across the US • higher rental demand • rental rates rising at a faster rate than household incomes • investors purchasing and rehabbing NOAH properties resulting in increased rents • low vacancy rates – owners choosing not to rent to HCV participants

  4. “How did the strategies come about” Ownership transition - two large NOAH developments in Richfield and St. Louis Park (700+ and 540+units) • Immediately Increased rents • Value added rehab – increasing rents further • Established new screening criteria and rescreened existing residents • Non-renewed leases – most month-to-month • No longer accepted HCV

  5. Ownership transition/Meadowbrook Manor One owner – largest rental and most affordable development in the City. Built in 1949 – 551 units – 160 townhomes and 391 apts.– 26 acre site

  6. Units renovated rents

  7. Housing advocate response • Position paper drafted - list of affordable housing initiatives that local government agencies could implement • Advocates lobbied policy makers – presented ideas to city councils and staff • Political will positive • Progressive communities took the lead

  8. Regional housing workgroups • SWLRT housing committee established – anticipation of housing development along the rail corridor • Regional, state, county, corridor cities, housing agencies and housing advocates • Housing analysis completed – established housing goals • Strategies and tools developed • Regional issues - workgroup converted into a region wide focus – expanded representative members to all local governments – new groups addressing voucher LL retention/recruitment

  9. St Louis Park/Bloomington: history of affordable housing high priority • Political will • Adopted city housing goals • Convened community workgroups • Established strategic priorities related to housing • Allocated resources

  10. Strategies and tools: 3 focus areas • Preserving existing naturally occurring affordable housing (NOAH) • Tenant protection initiatives • Creating affordable housing

  11. NOAH preservation strategies • Local 4d tax incentive program • Multi-family rental rehab program • Legacy program • Housing Improvement Areas (HIAs) • Housing Trust Fund

  12. Local 4d tax incentive program • State of MN tax classification – provides approx. 40% savings on rent restricted units • rents restricted at 60 % AMI or less and must receive financial assistance from government entity • target Noah properties – goal: long term rent restrictions • 10 year rent restriction • City provides $200 per unit grant and pays for 1st year tax application to state • Tax savings only applies to restricted units

  13. Multi-family rental rehab program • Properties with 3 or more units & 30 yrs. old • Must meet definition of a NOAH property (at least 18% of units affordable to households below 60% AMI) • Maximum loan amount/rent restricted unit = $5,000/$50,000 per building • 10 yr. deferred with 0% interest • Requires 1:1 match by other funds • Rents in assisted units restricted at or below 60% AMI for the entirety of the 10 year term of loan • Properties must give equal consideration to renting to tenants with housing subsidy vouchers

  14. Legacy Program • Work with property owners to promote preservation of NOAH • Connect NOAH owners to for and non-profit philanthropic and public investors and developers that create and preserve affordable homes • Benefits to property owner: • Maintain seller's legacy and ensure current residents have opportunity to remain in their homes. • Positive social return of preserve an affordable housing resource in the community. • Streamline sales process. • Currently have two churches that have merged/downsized. RFPs to redev. sites – requiring inclusion of affordable housing

  15. Housing Trust Fund • Bloomington – NOAH Fund – $100,000 per year in HRA levy to help facilitate the purchase/rehab of NOAH properties in the future • Bloomington – Establishing a Housing Truest Fund as part of the Opportunity Housing Ordinance • SLP – Affordable Housing Trust Fund – HRA levy primary funding resource. Facilitate the creation and preservation of affordable housing

  16. Additional Noah preservation programs: • Housing Improvement Areas (HIA): • City designates home association development as an HIA. • Provides a loan to association for property rehab/improvements • Resource of last resort • Requires reserve and asset study • Fees applied to property tax • Can provide hardship waivers to defer payments • Enhanced vouchers: project based developments opting out of HUD contract

  17. Additional preservation policies/strategies • Advance notice of sale • Non-discrimination based on the use of housing choice vouchers or other rent subsidies

  18. Additional preservation policies/strategies Advance notice of sale: • requires owners selling a property to notify residents prior to the sale • provides opportunity for preservation buyers to engage in the sale process • Allows tenants top prepare for impending sale and possible rent/lease changes

  19. Tenant protection strategies • 90 day tenant protection notice • Annual reporting of legal eviction actions • Notice of eviction - “pay or quit” • Eviction for cause • Non-discrimination based on the use of housing/rent subsidies

  20. 90 day tenant protection • Applies to NOAH properties where ownership is transitioning • Requires new owner to give notice to tenants of tenant protection requirements • Ordinance requires LL to pay relocation if they: • raise rents, • perform non-renewals without cause, • rescreen existing residents, within 90 days of sending notice to tenants following the sale of property

  21. Notice of eviction - “pay or quit” Prior to bringing an unlawful detainer eviction action for nonpayment of rent or other unpaid financial obligations, a written notice must be provided to the residential tenant specifying: • The allegations of nonpayment of rent/unpaid financial obligations • The total amount due • That property owner may proceed with filing an unlawful detainer eviction within 14 days of the delivery or mailing of the notice.

  22. Tenant protection strategies • Notice of eviction - “pay or quit” • Annual reporting of legal eviction actions • Eviction for cause • Screening restrictions • Restrictions on security deposit amounts • Non-discrimination based on the use of housing/rent subsidies

  23. Fair Housing, Tenant Rights training & Legal Representation • Local Fair Housing Policy: designates a staff person to act in a resource and referral capacity for persons with fair housing complaints • Tenant rights training – partner with the school district/community housing agency to provide tenant/landlord law training for non-English speaking immigrants • Legal representation for eviction actions: Hennepin county housing court project provides lawyers, legal advice on evictions, lease violations, etc. Available on-site at housing court.

  24. And there’s more……. • Citylandlord associations – offer training and informational session to promote good management practices. Staff discuss LL recruitment for HCV, rental ordinance requirements/proposals, crime free requirements, etc. • Annual rental licensing renewal process • owners report the number and nature of legal eviction actions filed in the previous 12 month period: • Certify whether the property meets the definition of a NOAH building • Information used to inform staff and policy makers in developing future housing policies/initiatives

  25. Creating Affordable Housing • Inclusionary Housing Policy/Ordinance • Land Banking • Land Trust • Financial assistance – TIF/TIF Pooling • Affordable Housing Trust Fund/HRA Levy • Rental assistance

  26. Inclusionary Housing Policy/Ordinance Policy requires new market rate residential developments to include a minimum of affordable housing units in the development Applies to multi-family developments: • Rental • Ownership • Rehab if units are added

  27. Eligibility St. Louis Park – all rental/ownership developments with 10 or more units that are: • receiving financial assistance from the city • seeking land use approvals through a PUD, or • requesting a comp plan amendment • 25 year affordability requirement Bloomington • all rental/ownership developments with 20 or more units • incentives and tools to balance costs of providing affordable units

  28. Affordable unit requirements SLP/ minimum number of affordable units must be included in the development: Rental: • 5% at 30% area medium income (ami) • 10% at 50% ami – also ownership requirement • 20% at 60% ami • One-for–one replacement: Must replace any NOAH units demolished or converted to other use • Ownership: Requires payment in lieu based on number of units and difference between and affordable ownership unit and the development units.

  29. SLP: Inclusionary housing production since adoption of ordinance in 2015

  30. Opportunity Housing Ordinance (OHO) Bloomington: Requires that 9% of units be affordable, tools and incentives to be used to go higher Provides tools and incentives: • Administrative: decreased parking, increased density, increased height, fee waivers, etc. • Financial: TIF, PBV, reduced land costs, housing trust fund, etc. • NOAH preservation with 4d Tax Classification

  31. Bloomington Opportunity Housing Ordinance

  32. Creating affordable housing – add ’l strategies • Land banking: city purchases/holds parcels; RFP for redevelopment • Providing financial assistance: tif, housing trust fund • Project basing HCV units • Partnering with land trust & affordable housing developers • Working with faith based organizations

  33. Creating affordable housing - rental assistance • Mainstream vouchers • Family Unification vouchers • Kids in the Park - city funded shallow rent subsidy program • Stable Home - partnership with Hennepin county/income based rent subsidy for persons leaving shelters; funded with HUD HOME funds

  34. Questions Bryan Hartman Program Manager City of Bloomington 952-563-8943 bhartman@BloomingtonMN.gov Michele Schnitker Deputy CD Dir./Housing Supervisor City of St. Louis Park mschnitker@stlouispark.org 952-924-2571

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