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Oct 16

October 13, 2016

Posted to City Manager Blog by Chad Bergo


Meetings and Announcements:    

Our next City Council meeting will be held on Monday, October 23rd Workshop will begin at 5:15 pm.  We will have 2 presentations: Comprehensive Plan Update and Communications Update.

Wakefield Building Design Update:  Staff is inviting City Council and the Parks and Recreation Commission to the October 17th PC/CDRB meeting to review the design of the Wakefield Community Meeting. At their meeting on September 11th, at Council directed staff to work with the PC, CDRB, and the Parks & Recreation Commission to assist  with the design work for the Wakefield Park Community Building. The architect for the project will be leading the discussion, and additional details will be forthcoming. Staff is very appreciative of Council’s support for this project and look forward to the joint discussion on October 17th. The ideal outcome is to construct a community building that the City Council, residents, and businesses are proud of and that showcases the City’s commitment to strengthen and build community.

Saturday, Oct. 28 11 am to 2 pm Celebrate with colleagues and the community as we mark the grand opening of the HealthEast Clinic and Specialty Center in Maplewood. 
2945 Hazelwood Street | Maplewood, MN 55109 

Fire Station Location and Operational Review.  November 2nd-3rd, 2017:  Stakeholder Meetings- Council members will be scheduled to meet with Consultant on these two dates. If you have not contacted Lois to schedule time, please do so that we can also move ahead with scheduling other stakeholder meetings. 

November 6th, 2017:  Special City Council Meeting -Final Report and Recommendations from Fitch and Associates.

Updates from Staff and Council


House Bond Tour- Gun Range-  The House Bonding tour  included a stop at the Gun Range site on Wednesday, October 11th at 10 am. Chief Nadeau and I  represented City as well as the Donofrio’s and Sue Vento. The City of St. Paul Police Department gave the presentation.  Legislators did ask questions of me regarding zoning and development and if we were open to partnering on the project. I indicated that we would like to use the facility if the sound mitigation project happened. If you would like to hear more about this, please give me a call. 


Business Engagement Breakfast- 
The Annual Business breakfast was a great success. I talked with several people who attended for the first time, got great feedback on our speakers, the food and our BRE Report. I would like to thank Dewey, communications staff and everyone involved with the planning for this event. Thanks to Council for attending. Communications staff is working on a video of the event. 

Information following up on two items from the City Council meeting on Monday.
Temporary Dwellings
On August 22, 2016, the city council approved a zoning code amendment that opted out of a state statute that would have required the allowance of temporary dwelling units. As part of the discussion of opting out of this state statute, staff was directed to vet the idea of accessory dwellings units as part of the comprehensive plan update. This discussion has occurred with the planning commission and housing and economic development commission. Staff does not believe either commission will support the city allowing stand along accessory units – otherwise known as “tiny houses” or temporary dwellings – but might suggest loosening city policies for creating an additional living unit for a “mother-in-law apartment” in existing basements or above garages.  

With that said, currently the city does not allow any accessory dwelling units on single family properties – either as standalone structures or within existing structures.  A property zoned for single-family can only has one living unit. In addition, the city prohibits long term habitation of campers or RVs and this is dealt on a code enforcement level.  There has been a couple instances of this occurring lately but overall has not been a trend of code enforcement staff has seen. 

Hillcrest Golf Course
City staff has received several questions regarding the potential redevelopment of the Hillcrest Golf Course in Saint Paul. Currently, Saint Paul zones the golf course for single-family residential. At this point, the golf course is only being put up for sale. No developer is in play at this time. Saint Paul staff has communicated to Maplewood staff they will be conducting a zoning study for this area to consider uses other than single-family homes. The zoning study will utilize consultants hired by Saint Paul and will likely begin in early 2018. Maplewood staff will continue to communicate with Saint Paul staff to stay plugged in on this process.  

Follow us on social media…
The City of Maplewood plans on ramping up our social media presence to include more news and announcements relevant to city staff. Since expanding our communications department at the end of the summer, we have added several new videos on social media featuring frontline workers and developments important to our workforce.  Maplewood’s social media channels are just one more way you can keep track of what’s going on. If you aren’t already, please follow us on Twitter: @MaplewoodMN or Like us on Facebook.
Some of these enhanced social media features come as a direct result of your feedback on the city’s recent employee engagement survey, where staff indicated they’d like to see more relevant and timely city news in more places. 


Here are recent samples of our video work:
Council’s Rapid Recap:
Prairie Restoration:

Rec Run:

Please continue to promote the link to weigh in on the Gold Line Station Development: 

Let us know what amenities and development you’d like to see around the Gold Line Rapid Transition Station in Maplewood


New Garden Beds at Edgerton Community Garden
By Oakley Biesanz, Naturalist, Maplewood Nature Center

Seven raised garden beds at Edgerton Community Garden have been installed this October, 2017.  They have been filled with a mix of half top-soil, and half compost.  They will be available for rent for the community for next year’s growing season.  A huge shout-out to Scott Shultz, Gary Hinnecamp, and their crew for the prepping of the site, and the careful construction, and filling of these beautiful beds.  There were many people on the wait list this year at the Community Garden, so this will help meet some of the demand.  Materials have been purchased and stored for three additional raised beds that will be available to gardeners by mid-summer next year once more sites are prepared for installation, and will be rented for a fall-planting.  A service crew of volunteers from Century College are scheduled to do some work spreading woodchips for the pathways to keep weeds at bay later this October.   Funds were provided by the Friends of Maplewood Nature, nonprofit group, and the Charitable Gambling Grant Award.
Raised beds improve overall soil conservation by building soil structure and health, and improving water infiltration.  They also reduce the need for tilling, thereby reducing the carbon emissions from the tiller, and carbon release from the soil upon tilling. Raised beds can be gardened more intensely than a regular plot, allowing for more space to serve additional community gardeners.  Raised beds can also help ease physical limitations that might otherwise interfere with traditional in-ground gardening, so priority for using the raised beds will be provided to gardeners wit self-reported mobility challenges who require special accommodation in order to garden.  

PUBLIC WORKS- letter from resident
Bryan Nagel:

Thank-you very much for such a quick repair of the sanitary sewer opening at the back of our property at 1569 Lakewood Drive N, Maplewood.  My email with general description & photos of problem was sent to you last Thursday (9/28).
It was a pleasant surprise to see repair folks at our property the first thing Friday morning (9/29).  All folks working on this repair were knowledgeable and very professional.  They inspected existing line from back of property to the street to verify integrity and clean any debris.  They also ran a camera through the line to complete the whole verification process.  Repair Team then confirmed the last section of pipe containing water inlet grate had separated from next pipe section but everything appeared to be structurally intact.  Team then discovered the two pipe sections could not be quickly pushed back together because it appeared two slightly different pipe types were installed 30 years ago.  Bottom Line - the two pipe sections could not be fully inserted together.  Good New was that the two sections could be inserted partially - just not all the way.  The Team reviewed things with me and recommended attachment bands be placed on both pipe sections and use steel rods that can then be tightened to keep two pipe sections from separating.  A concrete band was also installed around the piping junction to maintain integrity.
All things were fully explained to me.  After all repairs were made, the crew came back with black dirt to correct all grade issues.  In short - a job well done.
Currently, we have Villa Landscaping on site to install a patio and a garden wall system.  So we will make sure reinstall sod and rock around storm sewer opening now that you folks have repaired things.  It's great to have a correct elevation "reference" point we can work to.
You can email or call me at any time.  Again, just wanted to say thanks very much for a job well done.  Please pass my thanks on to your people and the repair team.
Tom Birkholz
1569 Lakewood Drive N., Maplewood, MN 55119
CELL:  651-338-8191

Conway and Carlton Intersection Study
City staff was contacted by a concerned citizen regarding the intersection of Conway Avenue and Carlton Street after seeing an accident at this intersection.  Currently the north leg (Carlton Street) and south leg (3M Campus) of the intersection are signed with “Stop” signs.  The east and west legs (Conway Avenue) are not signed.  
The City of Maplewood follows the Minnesota Manual of Uniform Traffic Control Devices (MN MUTCD) for the placement of all traffic signs/devices installed on city streets.  This intersection was evaluated in 2014 to see if it met the warrants for an all-way stop as defined by the MN MUTCD.  This study showed that the intersection did not meet the required warrants for an all-way stop at that time.
City staff and consultants have completed a new evaluation to see if there have been any changes since the 2014 study.  The results of this study show that this intersection now meets the MN MUTCD warrants for an all-way stop.  City staff plans on bringing this item for Council approval at the October 16, 2017 City Council meeting. See attached map. 

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News From local sources and agencies :  Reference:  Cmdr. Kvam

News this week from MLC and Star Tribune covering many political topics.
METCOUNCIL: via the office of the Legislative Auditor, VERBATIM: “We conducted this review in response to a new law (Minnesota Statutes 2017, 3.972, subd. 4) that requires the Office of the Legislative Auditor to conduct a quarterly review of the transit financial activity of the Metropolitan Council’s Transportation Division and the Counties Transit Improvement Board…We found that the Metropolitan Council and Counties Transportation Improvement Board have had sufficient revenues in recent years to cover their transit expenses, but in its internal forecasts the Council projects budget shortfalls starting in Fiscal Year 2020. We also found that in its reports to federal officials, the Council has made financial projections that differ significantly from those it provided to the Legislature.” AUDIT:
TORKELSON: via Rep. Paul Torkelson, Chair of the House Transportation  committee, VERBATIM: “Time and again, I and other Republican members of the House Transportation Finance Committee pointed out apparent discrepancies in the financial information we received from the Met Council. They did their best to explain them away based on differences in fiscal years and interpretation of the data. The OLA has now revealed that the Met Council seems to be adjusting their financial reports depending on the desired outcome and the governor’s office used those reports to support his demands for state funds to cover the alleged $70 million deficit. We look forward to discovering the truth,”
DIBBLE: via statement from State Sen. Scott Dibble, VERBATIM: “House and Senate Republicans have aggressively attacked transit riders this year, taking aim at those people who we should be reaching out to the most – students who depend on transit to get to class; seniors who can no longer drive but want to stay active in their communities; young people who cannot afford to, or simply don’t want to be forced into car ownership; Minnesotans with disabilities who rely on transit to get where they need to go; and people who need transit because they would otherwise not be able to get to work… A simple reading of the report makes it clear that the alleged discrepancy Republicans claim is comparing apples to oranges. The state budget request – submitted in February 2017 – offers funding projections for the next four years. This request was submitted before the June 2017 dissolution of the Counties Transit Improvement Board, which dramatically changed the landscape of funding for transit in the metro area, especially for Southwest Light Rail Transit… Comparing a two-year budget request for the entire transit system (which itself was based on circumstances that later changed) to a totally different matter, focused on a different timeline as part of a funding request for a single project, is just another dirty trick, trying to bob and weave and cast blame on others for their successful push to divide our state and to drastically reduce transit service.
Report on Met Council books adds fuel to bitter transit debate
Met Council under fire for "inconsistencies" in books, but says it's a misunderstanding. 
By Janet Moore Star Tribune
MORE ON CONGESTION: via KSTP, VERBATIM: “The Minnesota Department of Transportation last week released a report that showed nearly 24 percent of Twin Cities freeways are congested. ..That means traffic, on average, is flowing at 45 miles an hour or slower. ..Brad Larsen is a MnDOT transportation planner and leads the effort to figure out how to help unclog traffic… LARSEN: "We are generally focused on which corridors have the highest transit demand," Larsen said…On Monday, Larsen shared MnDOT's vision for updating the MnPASS master plan with members of the Metropolitan Council. A study identified which stretches of pavement are under consideration for possible MnPASS lanes… Topping the list is Highway 252 in Brooklyn Park, which is the source of frustration for tens of thousands of drivers forced to contend with stop light after stop light along the way… MnPASS lanes were added in the north metro community, it would cost an estimated $140 million, according to the study.  However, it's estimated the new lanes would save commuters nearly 40 percent in travel time because a single MnPASS lane can carry twice as many drivers as a regular lane. Larsen said that amounts to 1,186 hours saved on the road per person, per year.” READ/WATCH:

OCTOBER 4, 2017 — 11:25PM
An audit of the Metropolitan Council found “inconsistencies” between gloomy budget assumptions provided to state legislators and those given to the federal government related to future light-rail projects.
A report released Wednesday by the state’s legislative auditor questioned “whether the council was fully disclosing to the federal government its true financial situation,” given its budget deficit and declining financial support from the Minnesota Legislature.
The council is expected to apply for $1.7 billion in federal aid over the next year to help build the Southwest and Bottineau Blue Line light-rail projects. Without federal support, it is not likely the two lines will be built.
The report states that “the council’s transit finances have been presented in a less favorable light” to state legislators. “These different assumptions lead to significantly different projections of the council’s future financial condition.”
The report drew a swift response from Republican legislators at the Capitol, renewing the bitter debate over mass transit spending and operations of the Met Council, whose members are appointed by the DFL governor.
“Either they are lying to the federal government to secure funding for the Southwest light rail boondoggle, or they misled Minnesota taxpayers who paid for their supposed operating deficit,” Rep. Linda Runbeck, R-Circle Pines, said in a statement.
Lawmakers agreed to spend $70 million this past legislative session to help offset the council’s operating shortfall this fiscal year.
Met Council Regional Administrator Wes Kooistra said in a letter to the legislative auditor that the body has not “attempted to reconcile” financial forecasts. State budget forecasts are short-term for a two-year period, while the Federal Transit Administration (FTA) requires information covering a far longer period.
Sen. Scott Dibble, DFL-Minneapolis, released a statement dismissing GOP criticism.
“A simple reading of the report makes it clear that the alleged discrepancy Republicans claim is comparing apples to oranges. The state budget request — submitted in February 2017 — offers funding projections for the next four years,” Dibble said.
The senator said the dissolution of the regional Counties Transit Improvement Board, “dramatically changed the landscape of funding for transit in the metro area, especially for Southwest Light Rail Transit.”
He said the federal financial management plan submitted at the end of June 2017 provided a look back at 10 years of funding, and 20 years of projected spending. It also included substantial changes to reflect the negative outcomes of the 2017 session and Hennepin County picking up the tab for what he called funding failures at the state level.
The legislative auditor’s report came about after legislators passed a law this spring calling for quarterly reviews of the council’s transportation budget, which totaled $623 million this year. The auditor’s review studied financial information from Jan. 1, 2016, to June 30 this year.
The council has predicted an $86 million shortfall in its transportation budget for 2020 and 2021, due to declining revenue in the motor-vehicle sales tax and increasing demand for Metro Mobility, a transportation service for disabled people.
Council spokeswoman Kate Brickman said, “we appreciate that legislative leaders stepped up and funded our short-term deficit and look forward to continue to talk to them about our future needs — in particular, the growing needs of Metro Mobility, which is a federally mandated service.”
The auditor’s report found no “significant problems” with the council’s balance sheets for its transportation division, and that adequate reserves have been maintained to adjust for variations in transit revenue and expenses.
Auditors recommended that in future reports to the Legislature, the council “explicitly identify” differing budget assumptions for transportation plans.
Rep. Paul Torkelson, R-Hanska, agreed with the recommendation: “There’s been some frustration with different numbers [the Met Council] gave us throughout the session. We need clearer information.”
But Torkelson, chair of the House Transportation Finance Committee, doesn’t believe the council is “being dishonest. It’s not like there are two sets of books — the federal government needs one perspective on the data, and the state requires a different perspective.”
The FTA said in a statement Wednesday that it evaluates transit projects for its grant program based criteria set by statute. The evaluation process is “a thorough and rigorous review of the project [builder’s] financial capacity and the financial plan for the project,” the statement says.
The audit also explored the finances of the now-defunct Counties Transit Improvement Board, which used various tax revenue to pay for local transit projects. No issues were found with that board’s finances.
Under pressure, landlords tackle affordable housing
Developers are growing increasingly worried about a housing shortage — and about what Minneapolis might do if they can't fix it.
 SUBSCRIBER CONTENT: Oct 5, 2017, 12:41pm CDT Updated: Oct 5, 2017, 1:16pm CDT
Fresh off a $15 minimum wage win at Minneapolis City Hall, progressives now have their sights set on affordable housing. If some of the farthest left-leaning candidates win seats on the City Council, the Twin Cities could get its first taste of San Francisco-style rent control. ¶ The idea — just the mention of it — frightens developers, some of whom are passionate advocates for affordable housing. A few of them are scrambling to build or preserve as much affordable housing as they can, but they fear government-controlled caps on what a landlord can charge on rent will set the city backwards, not forward.
“Once rent control is even mentioned in a community it has the effect of lessening an investor’s willingness to go and invest in that community. You scare people away from building apartment buildings,” said Paul Sween, managing partner of Dominium, the most active developer of affordable housing in the Twin Cities and one of the biggest such firms in the nation. “As a person who cares deeply about affordable housing, I wish that Minneapolis would not further the process of rent control.”
For-profit developers like Dominium, as well nonprofit developers like Minneapolis-based Aeon, are taking bold steps to combat a worsening problem in hopes they can solve it before something like rent control takes hold. They also have some ideas of their own on how to solve the issue.
The preserver
In a given year, developers will deliver somewhere between 1,000 and 2,000 affordable units to the Twin Cities housing market. That alone hardly makes a dent, because somewhere around 550,000 families are deemed by the Minnesota Housing Partnership as cost-burdened — they’re paying more than they can afford for rent or mortgages.
A trend popped up a few years ago that troubled Alan Arthur, CEO of Aeon. Aging apartment buildings in the inner-ring suburbs were being scooped up by companies that would raise rents and force out families who couldn’t afford their units anymore.
The most high-profile case was in Richfield in 2015. Soderberg Apartment Specialists of Brooklyn Center bought the 700-unit Crossroads apartment complex, which had become what housing experts call NOAH — Naturally Occurring Affordable Housing. Like so many buildings in the inner-ring suburbs, it was built in the 1960s or 1970s and had aged to a point where the landlord was charging rent that was affordable for people making 60 percent of the median income in the Twin Cities — $37,980 for one person or $54,520 for a family of four.
Soderberg fixed up the building, raised rents and forced hundreds of families to scramble to find shelter. Arthur notes that the Crossroads project wiped out most of the gains in affordable housing units that developers like Dominium and Aeon had made that year. It was a Sisyphean effort.
Long a developer of affordable housing, Aeon continues to do so with several projects in the pipeline in the Twin Cities, including one near U.S. Bank Stadium. However, seeing what happened in Richfield, Arthur devised a new tactic. Aeon would keep its ear to the ground and, when it got wind that a developer was going to strike a deal similar to the Richfield Crossroads project, it would intervene.
This year, Aeon discovered that a developer had similar ambitions for another aging building in Richfield, the 422-unit Seasons Park Apartments complex. Aeon stepped in. It paid $36 million for the buildings in September and will raise rents slightly, to $920 a month. The alternative, Arthur said, would have been rents of hundreds of dollars more per month under another owner.
Aeon will keep developing, but it knows that preserving affordable housing is a more efficient way to deal with a runaway problem.
“New apartments to build are at least $200,000 per unit, depending on the size of the unit. To preserve them, it’s closer to $100,000,” he said.
Aeon has signed a purchase agreement to buy 10 apartment complexes from a single owner. Six of the buildings are in Bloomington, two are in New Hope, one is in Brooklyn Center and one is St. Paul.
The total cost, when the deal closes this month, will be north of $80 million, Arthur said. To fund such massive undertakings, Aeon has started a capital campaign in which the company is attempting to raise $100 million over the next seven years, hitting up corporations and wealthy individuals to make investments.
Arthur, for his part, is worried about the problem. He predicts that if Minnesota housing and economic trends stay their current course, tent cities will need to be erected to house all the people who can’t afford a rent payment or mortgage.
He pointed to Seattle, where the city has sponsored several tent encampments in which previously homeless people sleep in tiny structures and tents on a raised platform, with the city providing utilities like water, sewage and electricity.
“If we want to continue to be a strong economic area and we don’t do something about the housing problem and we don’t do something about wages, we will have to do what Seattle is doing,” Arthur said.
If Arthur could change policy, he would quadruple the amount of money and tax credits available for affordable housing in Minnesota, which currently ranges from $50 million to $110 million per year, according to the Minnesota Housing Finance Agency. Affordable housing, in his eyes, should be treated like roads and bridges. It’s part of the Twin Cities infrastructure.
Rent control is not on his wish list.
“Rent control sounds like a great idea, but the problem is that it does not create more housing. It puts a damper on creating more housing. What we need is more units,” he said.
The builders
If there’s an affordable apartment that’s gone up in your neighborhood, whether in the city or suburbs, there’s a pretty good chance Plymouth-based Dominium developed it.
No one is taking advantage of tax credits for affordable housing more than Dominum, which has 2,300 units in the Twin Cities pipeline and was the sixth most-active developer of affordable housing in the country in 2016, according to Affordable Housing Finance. Dominium owns 25,000 units of affordable housing in 26 states. Only one firm has a larger portfolio: The Michaels Organization in Marlton, N.J.
Sween, Dominium’s managing partner, has been involved in the affordable housing industry since 1982. He sees a widening gap in the supply and demand in affordable housing. When a new Dominium building opens, units lease up faster than he’s ever seen. That is particularly true for affordable senior housing projects, which tend to be slow to lease because tenants move following events like a death or disability, Sween said. But senior buildings are filled within three months, which was previously unheard of, he said.
Sween sees some positive trends. For one, building affordable housing has become easier to finance because of low interest rates. It’s not the availability of tax credits that’s slowing him down now, it’s staffing. The company is a couple years into its goal of doubling in size over a 10-year period and has been hiring developers. Similarly, Aeon has goals of tripling production and said it has hired eight new employees in the past three months.
Sween said another trend has emerged, one that is surprising considering some of the high-profile fights recently between neighbors, developers and city officials in St. Paul and Arden Hills.
“Many communities seem to be far more willing to say outright they want affordable housing in their community,” Sween said. “I have never seen a time when there is less NIMBYism (Not In My Back Yard) than I have seen right now. That’s not to say there is no NIMBYism, but there is less.”
More is better
Ultimately, the market just needs more units, and if cities let developers build more, rents will go down, Sween said. To that end, the Minneapolis City Council has taken steps to make it easier to build all types of apartments by easing parking requirements, allowing for the construction of smaller units and increasing density along transit corridors.
Bloomington and Richfield also are taking further steps to encourage the preservation and development of affordable housing. Even in Edina, the Planning Commission recently approved an affordable housing component to the high-end Estelle condo towers project that Ryan Cos. US Inc. plans near Southdale Center.
“Many community leaders are recognizing that the people who work in their communities — whether it be entry-level school teachers to service workers — these people are having a very difficult time finding housing that is affordable to them,” Sween said.
Another active affordable housing developer is Steve Minn, whose Lupe Development Partners is working on projects on the Blue Line in South Minneapolis and along the Green Line near Prospect Park.
Minn also is a former Minneapolis City Council member who has strong opinions on what the state and cities could do to increase affordable housing.
He said the state should give aging buildings like Seasons Park Apartments the same property tax rate as new affordable housing. So long as landlords keep rents in the affordable range set by the Minnesota Housing Finance Agency, they would pay a lower property tax. That could save them hundreds of thousands of dollars a year and incentivize landlords not to sell to a company that would renovate and raise rents.
“It’s a simple solution,” Minn said. “Give existing affordable housing owner the same lower tax rate I get when I do [a new project].”
He’d also increase the bonuses for affordable housing that have been baked into Minneapolis zoning laws for 18 years.
Under current code, if a developer wanted to build 120 units on land that was zoned for only 100 units, the developer would have to build 20 affordable units to get the bonus. Minn said almost no one takes advantage of that law. If the bonus was raised to 50 percent — so that developers would get to build 150 units instead of 120 units — more would take advantage.
“It needs to a be a 50 percent bonus because by the time you build 20 percent affordable housing, it’s a break-even proposition,” he said.
The threat is real
The $15 minimum wage idea a few years ago seemed far-fetched, which is sort of how the rent control idea feels now. There’s a growing slate of progressive candidates running for City Hall and they’re not backing down on their agenda.
One of the leaders of the 15Now campaign, Ginger Jentzen, is running for City Council in Ward 3 and has raised $60,000 — three times more than her DFL-endorsed opponent in the race, Steven Fletcher.
Last month, the Minneapolis Regional Chamber of Commerce and the Minneapolis Downtown Council held a forum for Ward 3 candidates and the room had plenty of developers and real estate professionals. Jentzen was clear about her agenda, and it started with rent control at the top.
“[It’s been] decades of the let-the-market-decide approach and it hasn’t actually worked,” Jentzen said. “It didn’t work for wages and it’s not working for housing.” ?
Define "affordable"
There are many ways to measure affordable housing, but in general, housing is considered affordable when a family is paying 30 percent or less of its gross income on housing.
Someone making minimum wage — $9.50 an hour or $19,760 annually — would have to pay less than $494 on housing per month to meet that definition.
In order for developers get tax credits for building certain types of affordable housing, they need to rent apartments at certain rates to people making certain incomes. A popular tax credit is often used at buildings with units affordable for families making 60 percent of the area’s median income. In Hennepin County, that means:
A single person making $37,980 a year would not pay more than $1,017 a month for a 1-bedroom apartment.
A family of four earning $54,240 a year would not pay more than $1,221 a month for a two-bedroom apartment.
Source: Minnesota Housing Finance Agency
 Is there — or is there not — an affordable housing crisis in the Twin Cities?
By Greta Kaul | 10/04/17
Minneapolis city officials are saying it, a St. Paul neighborhood group is saying it, and housing advocacy groups are saying it: the Twin Cities are in an affordable housing crisis.
That might come as a surprise to some. After all, this isn’t San Francisco, overrun with wealthy tech bros and with limited room to expand. To be sure, the Twin Cities are more affordable than a lot of coastal cities.
In fact, overall, data on housing affordability in Minneapolis and St. Paul indicates that the portion of income people spend on housing is actually going down.
So does that mean talk of a crisis in housing affordability is overblown? Not quite. Because what that overall number fails to show is that even as housing becomes more affordable for some, it’s becoming less so for others.
Measuring affordability
First things first: how do we know whether housing is unaffordable or not? The standard measure for whether housing is affordable or not is if a household is spending 30 percent or more of its income on housing expenses.
That means a household making $30,000 a year shouldn’t spend more than about $750 a month on an apartment or house and utilities. A household making $100,000 a year shouldn’t spend over $2,500. If they do, they’re considered “cost-burdened.”
The 30 percent metric evolved out of federal housing programs, beginning in 1937, when the United States National Housing Act created the public housing program and set limits on the amount families could make to qualify for it, according to the U.S. Census Bureau. Eventually, a share of income — first 25 percent and then 30 percent— was adopted as a standard. Since 30 percent became a widely used benchmark for determining how much households would spend on rent and still be able to pay for their other expenses, it was adopted in the mainstream housing market.
But is a standard developed 80 years ago still relevant today? Not everyone thinks so. Critics dismiss the 30 percent benchmark as all but meaningless because it doesn’t account for the differences in other expenses households have, be they medical or transportation costs. Plus, they say, there’s no reasonable expectation that two households should aim to spend the same amount of their income on housing. Generally, poorer people spend a larger share of their income on rents or mortgages, while high-income people spend less.
“Clearly, Bill Gates doesn't spend 30 percent of his income on housing,” said David Bieri, an associate professor of urban affairs at Virginia Tech.
So what alternative measures are out there? One general way to think about housing affordability, Bieri said, is to ask whether or not a household could stay in its housing for the average duration of unemployment in the area. If it could, the housing might be considered affordable. If not, that household might be cost-burdened. But this would be complicated to measure in a comprehensive way for all households in a given area.
Sticking to numbers that are easier to measure, another metric, preferred by some, is the H T index, calculated by the Center for Neighborhood Technology. H T starts with a regular income threshold and adds in transportation costs, which it says are most households’ second-largest expense.
According to this measure, housing is affordable if households spend no more than 45 percent of their income on housing and transportation. When you factor in transportation like this, some parts of the suburbs, where households would presumably spend more on transportation, become less affordable.
In Minneapolis, the average moderate income household, making $55,000 a year, spends 44 percent of its income on housing and transportation costs — just under the 45 percent threshold — while in St. Paul, the average is 43, according to this index.
In San Francisco, a moderate income household makes $65,000 and spends 50 percent of that on housing and transportation. In New York, where a moderate-income household makes nearly $54,000, the figure is 47 percent.
Compared to other cities, this measure makes the Twin Cities look relatively affordable for moderate income households. Even in Houston and Detroit, the average household spends a higher share of its income on housing and transportation than the Twin Cities, according to this index.
Who pays most in the Twin Cities
But even if the Depression-era 30 percent of income threshold is a flawed metric, it’s the one that’s most commonly used — and studied.
By the 30 percent rule, the share of Twin Cities residents who can’t afford their housing has actually gone down in recent years: from about 35 percent in 2011, to 28 percent in 2016 according to Minnesota Compass, a research division of the Amherst H. Wilder Foundation located in St. Paul. That’s still up, however, from 26 percent in 1990 and 24 percent in 2000.
But still, a seven point decline in housing unaffordability in five years seems like the opposite of an affordable housing crisis, right? Not, it turns out, if you break these figures down for different levels of income.
“Overall, housing cost burden has gone down in the Twin Cities,” said Allison Liuzzi, the director of Minnesota Compass. “But when we break it down by household income, we see some different patterns.”
For the Twin Cities’ poorest households, the rate of unaffordable housing has stayed steady — and high. More than 4 out of 5 households earning less than $20,000 per year are cost burdened when it comes to housing.
The two wealthiest groups of households in Wilder’s data, households making between $50,000 and 74,999 per year and those making $75,000 per year or more have seen the share that are cost burdened decrease between 2011 and 2016, from 29 percent to 23 percent and from 8 percent to 4 percent respectively.
But there’s one group of households that has seen their ability to afford housing actually decline — the households earning between $20,000 and $34,999. In 2011, 66 percent of these households were cost-burdened. In 2016, that figure was 72 percent.
Struggling to pay rent
It’s clear then, that even though overall Twin Cities affordability has improved over the last five years, for some households’ housing is getting less affordable. What’s behind this discrepancy?
One explanation is that there is a lot more competition for rental housing than there used to be.
Americans’ pocketbooks took a hit during the recession, and even now, years after the economy’s recovery, wages are slow in keeping up. This helped turn more people into renters, which, in turn, put more pressure on the rental housing stock.
Today, a lot of the people who are renters might not have been in years past. A report by the Minnesota Housing Partnership looked at the dynamics of this phenomenon:  In the years following the recession, an increased number of renter households were making more than $50,000 per year. Nearly half of these new renters, even, made more than $100,000, data compiled by MHP found.
Many of these new, higher-income renters might be homebuyers if it weren’t for a small stock of starter homes available, said Chip Halbach, the executive director of the Minnesota Housing Partnership, who has been working on housing affordability in the Twin Cities since the late-’70s.
When more people want to rent, landlords have an incentive to invest in rentals, renovate them, and jack up the rent. That can destroy what’s called “naturally occurring affordable housing,” in the industry, a term that refers to housing becoming naturally less expensive as it becomes older and less attractive to people with more money in the bank.
“So you have rents increasing across the board, but then in specific properties that are seen as ones that could be made attractive to higher income tenants, basically taking them out of buying reach of lower income people,” Halbach said.
Not only are existing rentals getting more expensive, but new rentals are pricier than they used to be, to suit this new crop of renters who want amenities — gyms, dog parks and the like. One new apartment building in Golden Valley even advertises “Minneapolis’ one and only lazy river pool experience.”
By 2015, the average rent in the Twin Cities metro rose to $1,046 per month, which MHP says is $130 more than the median renter can afford. The vacancy rate for rentals, around 3 percent, is below the 5 percent threshold often used to denote a healthy housing market.
It remains to be seen whether efforts to combat the shortage of affordable housing in the Twin Cities, such as an increase in the minimum wage and the just-approved Ford Site plan, which is expected to include hundreds of affordable housing units, will relieve some of the housing cost burden on Twin Cities residents.

But Halbach said it will take more than one policy to fix the problem, from increasing the supply of housing to ensuring that older units maintain their affordability.
“It’s been a perpetual crisis, but right now we are in a wave of lack and loss of housing affordability that’s really unique,” he said.
Thanks for reading and I hope you all have a great weekend. Please call or email if you have any questions or concerns. Melinda
Mar 01

The New Guy - Bryan Smith

Posted to Council Account by Chad Bergo

When I got the assignment to write an article for this month’s Maplewood Living, I really didn’t want to write “the new guy” article. The reality is, however, that I have now been sworn in for about six weeks, I have attended 3 council meetings, and have been working hard to learn the ins and outs of Maplewood operations and how to be the best councilmember I can. It feels strange to be writing this so early; I am the new guy after all…

We have all been the new person: new kid at school, new person at work, or the new family on the block. It can be a tough time of uncertainty and anxiety, but it is also a time of opportunity for new friends, new skills, and new knowledge. I have felt all of these feelings since being sworn in. In fact, I am not only the new guy here, but also am the new guy on the Gateway Corridor Commission and a number of other groups for which I now represent the city.

As I have begun this journey, there are a number of life lessons I reflect on and hold in my heart:
1. Be grateful: I am deeply grateful for this opportunity to serve our city, and also for my colleagues on the council, the mayor, and many leaders from the city staff who have all been generous and patient while teaching me and answering all my rookie questions.

2. More elephants and fewer hippos: Picture it: elephants have huge ears and small mouths while hippos have huge mouths and small ears. I know I can tend to be more of a hippo, more apt to speak than I am to listen carefully. I am doing my best to be more of an elephant, and it takes a great deal of energy for me to slow down, shut my mouth, and listen. I am doing my best, and when I am successful, I find it serves me quite well.

3. Be kind: I have never regretted being kind to someone – I have, however, regretted being unkind almost every time. My wife and I have always expected our son to show kindness to others, and at 7 years old, he is now my role model. I hope I can grow up to be as kind and empathetic as him.

While I really didn’t want to write the new guy article, I think that I just did. One thing I have learned in my career is that people typically feel “new” a lot longer than they are seen as “new” by others. Hopefully you still see me as “new” – I know I still feel it. I am looking forward to the challenge ahead, to getting to know you all better, and to working to make our city the best it can be.

Tag(s): Bryan Smith