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Request for Committee Action

Minneapolis inclusionary housing policy draft recommendations (RCA-2019-01143)

ORIGINATING DEPARTMENT
Community Planning & Economic Development
To Committee(s)
# Committee Name Meeting Date
1 Housing Policy & Development Committee Oct 16, 2019
Lead Staff:
Andrea Brennan
Presented By:
Andrea Brennan
Action Item(s)
# File Type Subcategory Item Description
1 Receive & File Report

Receiving and filing a presentation on draft recommendations for Minneapolis inclusionary housing policy.

Ward / Neighborhood / Address
# Ward Neighborhood Address
1. All Wards
Background Analysis

On February 9, 2018, City Council President Lisa Bender introduced subject matter to establish an inclusionary zoning (housing) ordinance. Inclusionary housing is intended to advance the goals of the city’s housing policies by ensuring that affordable housing is provided in new residential or mixed-use developments.

Since 2003, the City of Minneapolis has implemented housing policy that requires affordable housing units in residential and mixed-use projects with 10 or more units that receive financial assistance from the city. The policy was expanded to apply the affordable housing requirement to projects receiving pass-through funding from the city (state or federal funds), and projects developed on property or a portion of property owned by the city.

In 2017, the City engaged a consultant, Grounded Solutions Network, to conduct financial feasibility analysis and policy research regarding national best practices to inform recommendations for additional inclusionary housing policy options for the city. Their report included pros and cons of different policy choices, and case studies of three other cities with inclusionary housing policies. This work was supported by a team of City staff from Community Planning and Economic Development (CPED) Housing, Development Services, and Long-Range Planning divisions, City Attorney’s Office and the Finance and Property Services department. Grounded Solutions Network solicited input from private developers and affordable housing advocates in this process.

The Grounded Solutions Network report was presented to the Housing Policy & Development Committee of the City Council on August 22, 2018. The report informed an inclusionary housing policy framework adopted by the City Council on December 7, 2018, concurrent with the Comprehensive Plan (Minneapolis 2040). The City Council directed staff to develop a comprehensive inclusionary housing policy consistent with this framework in 2019. Also on December 7, 2018, the City Council approved amendments to the Unified Housing Policy and the Minneapolis Zoning Code to allow for an “Interim” inclusionary zoning ordinance and inclusionary housing policy, to be in place from January 1, 2019 until the permanent policy is adopted and takes effect. The interim ordinance only applies to projects that need re-zoning and/or substantial additional development capacity of 60% or more, exempts ownership housing and housing primarily targeted to students.

In early 2019, the City conducted a request for proposals (RFP) and again engaged Grounded Solutions Network to assist with the development of a permanent inclusionary zoning policy and implementation program. This work is underway, supported by the inter-departmental staff team and involving stakeholder engagement, interviews, research and technical assistance.  On July 16, 2019 Grounded Solutions Network conducted stakeholder meetings with developers and affordable housing advocates on potential compliance alternatives for inclusionary housing policies, and on July 17, 2019, Grounded Solutions Network presented an overview of the main types of compliance alternatives and their pros and cons to the Housing Policy and Development (HPD) Committee. Compliance alternatives allow choices other than developing affordable housing units on site. Input shared at the stakeholder meetings and during the HPD Committee discussion has informed draft policy recommendations. 

Grounded Solutions Network will present draft recommendations for the permanent inclusionary housing policy to the HPD Committee on October 16, 2019.  Stakeholder meetings with developers and affordable housing advocates are scheduled for October 15, 2019.  Input received from stakeholder meetings and the HPD Committee discussion will inform final policy recommendations, to be considered for approval by the HPD Committee on December 4, 2019.

FISCAL IMPACT STATEMENT
  • No fiscal impact anticipated