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HRSR INFORMATION 05-27-2003 Best practices review on preserving housing affordability Page 1 of 2„*ii-ORNIATIOg4 Cities Bull ONLINE EDITION Best practices review on preserving housing affordability Issue 18 May 9,2003 The Office of the Legislative Auditor has released a study that identifies best practices for local governments that have decided to become involved in preserving housing. The report,released on April 16, identifies strategies that cities are using either on their own or when working with local or regional housing and redevelopment authorities (HRAs), economic development or community action agencies, nonprofit housing organizations or regional development commissions (RDCs). The full report,Preserving Housing:A Best Practices Review, is available on the OLA web site. To receive a hard copy of the report by mail, call(651)296-4708. The report recommends the following best practices: • Cities that have not identified their housing needs should do so by analyzing information in the context of long-range planning and strategic thinking. • Cities should set housing goals and objectives, evaluate possible responses, and select strategies • aligned with their objectives. • Jurisdictions that administer housing-related codes should facilitate voluntary compliance, apply and enforce codes consistently, use a variety of enforcement methods, and target enforcement resources. • Jurisdictions that administer the State Building Code should publicize code requirements, offer technical assistance, make the permit process convenient, ensure consistent enforcement, and consider code compliance alternatives for existing residential buildings. • Cities that offer financial assistance for preserving housing should find partnerships that give cities the capacity to take advantage of myriad complex programs. • Cities that support access to housing information or expertise should seek collaborations, identify residents' information needs, and provide information in a variety of ways. • Cities that have not identified their housing needs should do so by analyzing information in the context. • Cities that offer access to repair and rehabilitation services, such as weatherization or acquisition and rehabilitation programs, need to manage those services' planning, implementation, and marketing. • To determine how well housing strategies meet objectives, cities should periodically evaluate them. LMC Board Editor: Designer: Executive Director: of Directors Erica Norris Laura Zenz Jim Miller Copyright©2003 League of Minnesota Cities 145 University Ave.West,St.Paul,MN 55103 http://www.lmnc.org/bulletin/story.cfm?id=195&title_id=7 5/9/2003 Best Practices Review Summary#03-05a S OFFICE OF THE LEGISLATIVE AUDITOR STATE OF MINNESOTA Preserving Housing: A Best Practices Review April 16, 2003 his study identified best practices for • Jurisdictions that administer This governments that have decided housing-related codes should to become involved in preserving facilitate voluntary compliance,apply housing. Housing provides shelter,but and enforce codes consistently,use a quality housing also contributes to neighborhood and variety of enforcement methods,and { P economic vitality target enforcement resources. 14,; ;• ,y _ and sustains local Jurisdictions that administer the State 0" , , i tax bases. t. t , Building Code should publicize code ' Housing strategies requirements,offer technical r " ' a will vary from city assistance,make the permit process -'to - -„-- i :',Rit:i..i. i 3 to city,and each convenient,ensure consistent -� strategy has its enforcement,and consider code k compliance alternatives for existing own best practices. P O ''''''t--°`,,.°°'.3 ' 4 Local governments residential buildings.113 "- should follow best 1" ; practices in • Cities that offer financial assistance I `t preserving for preserving housing should find housing,and when partnerships that give cities the Al capacity to take advantage of myriad they work with d complex programs. Program ,.,, , others—housing � � and redevelopment administrators need to manage project authorities risks and identify clients. (HRAs),economic development agencies, • Cities that support access to housing community action agencies,nonprofit information or expertise should seek This review housing organizations,and regional collaborations,identify residents' recommends best development commissions—they should information needs,and provide practices for ensure that best practices are followed. information in a variety of ways. preserving housing and Recommended Best • Cities that offer access to repair and profiles local Practices: rehabilitation services,such as governments and weatherization or acquisition and organizations • Cities that have not identified their rehabilitation programs,need to housing needs should do so by manage those services' planning, using the analyzing information in the context implementation,and marketing. practices. of long-range planning and strategic thinking. • To determine how well housing strategies meet objectives,cities • Cities should set housing goals and should periodically evaluate them. objectives,evaluate possible • responses,and select strategies aligned with their objectives. Room 140,658 Cedar Street,St.Paul,MN 55155--Telephone: 651-296-4708--Fax:651-296-4712--E-mail: auditor @state.mn.us 2 PRESERVING HOUSING: A BEST PRACTICES REVIEW • Report Summary: Once housing needs are identified,cities should determine appropriate responses to Preserving housing means keeping meet them. Involving elected officials in residential units safe,livable,and setting housing goals and objectives is a attractive to occupants. Quality housing best practice to this end. Another is stock is important not only as shelter but evaluating a broad range of options and also as a means to long-term designing strategies to meet housing neighborhood stability,communities' objectives. economic viability,and strong tax bases. Example: St. Louis Park has designed Public sector responses to the need to multiple strategies to meet its housing preserve housing include: property preservation needs. The city enforces a property maintenance code and requires maintenance codes,inspections of rental property owners planning to sell their units,programs requiring inspections structures to have them inspected and to before homes are sold,proper correct deficiencies. The city licenses and administration of the State Building Code, inspects rental buildings with three or housing information campaigns,and more units. Further, St. Louis Park has financial subsidies. Not all cities will partnerships for offering financial become involved with preserving housing, assistance and housing preservation but those that do should follow best information. practices tied to the strategies they select. As part of deciding on appropriate housing Although we refer specifically to"cities," strategies,cities should determine whether counties or others working on local they have sufficient internal capacity to governments' behalf may be involved. implement the strategies or whether they should rely on outside professionals. • Thinking Strategically Example: Several metropolitan-area Cities should start by determining their cities lacking their own capacity to offer housing needs,if they have not already housing information and expertise use the done so. This involves analyzing Housing Resource Center, an arm of the nonprofit Greater Metropolitan Housing information on housing units and factors , such as demographic Corporation. The Center employs that affect housing,should g construction managers who answer home trends. Another best practice is improvement questions and help residents select housing identifying and prioritizing housing needs. evaluate contractors'bids. It also strategies that Many cities,especially smaller ones,may administers various financing programs on are aligned with need to enlist outside expertise to follow the cities'behalf. their housing these practices. Garnering elected officials' support is objectives. Cities should also study housing needs important when determining appropriate and how they relate to other issues in the housing responses,particularly if local community. Housing studies should be leaders have not been involved previously. part of long-term comprehensive and A final best practice is to plan for strategic planning processes. adequate investments in infrastructure such as streets and lighting. Example: Roseville developed a housing improvement plan that is part of that city's Example: In South St. Paul, the city and comprehensive plan. The improvement the HRA have been involved in activities plan, which the city reviews yearly to that form a base of local leader support for account for changing market conditions, housing initiatives. A housing committee, contains benchmarks for housing activities made up of members of the city council, and describes housing conditions in the HRA,planning commission, and staff, city. Together the housing improvement meets regularly to discuss housing plan and comprehensive plan have guided conditions and needs. Plus, strategic . the city's housing strategies and led to planning efforts among city stakeholders collaborations with housing experts. SUMMARY 3 • led to establishing a common vision for the target the housing codes to particular city's housing. houses or neighborhoods if resources do not allow inspecting all of them. Implementing Regulatory Strategies Example: In Bemidji, the city follows a g series of steps when owners do not comply with orders to correct deficiencies Among housing strategies that identified during inspections of rental communities may choose are regulatory housing. The city charges a rental strategies, such as adopting local codes registration fee that covers the first and that set standards for property second inspections, but building owners maintenance. Depending on must pay for each reinspection communities' own capacity,implementing necessitated by their failure to correct such strategies may require outside problems. Additional enforcement steps expertise. include letters from the city attorney,police citations, and registration revocations. One best practice for administering The most serious sanction is property housing-related codes is to encourage condemnations. voluntary compliance. When residents Jurisdictions that administer the State Local comply with the codes on their own,fewer Building Code should follow certain best governments public resources are needed for practices to support housing preservation. should encourage enforcement. Ways to achieve voluntary Practices such as publicizing code voluntary compliance include publicizing code requirements,offering technical compliance with requirements,using incentives to reward assistance,and making the permit process housing-related initial compliance,and offering technical convenient,encourage voluntary or financial assistance to violators. compliance. Other best practices are codes. Example: Prior to its annual inspections considering compliance alternatives and of rental units, Mounds View mails to applying the code consistently. rental property owners a list of common Example: Each January, the Melrose code violations as part of the notice that building official holds a contractor seminar their properties are due for inspection. to discuss building code requirements. The list allows owners to fix problems, Because the seminar is accredited by the such as missing smoke detectors or state, contractors receive professional improper clearance to electrical education credits for attending. The equipment, in advance of inspections, well-attended seminars allow sharing of reducing the number of deficiencies and information among contractors from staff time for reinspections. multiple cities and minimize the times that Jurisdictions should ensure consistent the building official has to answer the enforcement when administering same questions. housing-related codes. Consistency helps avoid charges of discrimination or Implementing Supportive arbitrariness. Strategies Example: When Cottage Grove Supportive housing strategies encourage implemented a program to inspect rental people to preserve their buildings. units, the building official developed an Providing access to financial assistance is inspection checklist containing 64 items one supportive strategy. For including foundation drainage and venting of plumbing fixtures. Using the checklist implementation,cities should explore ensures that the city holds each building to partnerships to attain the expertise and the same inspection standards. resources needed to deal with complex, multiple financing sources. Administering housing codes also requires enforcement mechanisms with Example: The Stevens County HRA • increasingly severe sanctions against applies for and administers housing grants noncompliance. A final best practice is to and loans on behalf of cities within the 4 PRESERVING HOUSING: A BEST PRACTICES REVIEW • county. In doing so, the HRA works with a different times. Effective housing city to identify housing needs and then preservation recognizes and tailors financing plans to meet them. The accommodates these differences. HRA has experience with federal and state housing programs, and its Example: Richfield and the Richfield HRA knowledge benefits the cities, which lack use many different ways to communicate the resources to develop their own housing-improvement information to housing expertise. residents. Written materials include a remodeling planbook, a contractor referral Another best practice tied to offering list, and numerous tip sheets on topics financial assistance is following such as how to secure bids from management controls to minimize the contractors. The HRA offers the services risks posed by expensive,time-consuming of a Remodeling Advisor, who meets with projects. Matching project cost estimates homeowners to discuss renovation with available financing and inspecting options. Richfield sponsors an annual work before paying contractors are remodeling fair, and it publicizes housing examples of these controls. It is also information using the city newsletter, Web important to identify and communicate site, and utility bill inserts. with prospective clients. Some communities' housing may need Example: The Central Minnesota direct repair and rehabilitation services, Housing Partnership, a nonprofit housing such as weatherization or acquiring and organization serving 16 counties, takes a rehabilitating rundown properties for "hands on"approach to administering the resale. Best practices vary by the service HOME Rental Rehab program. The but cover program planning, Partnership identifies and inspects implementation,and marketing. potentially eligible properties, develops the scope of the work, monitors the work, Example: For decades, Semcac, a • conducts final inspections, and disburses community action agency in southeast money to contractors. Its active Minnesota, has offered weatherization management role helps it meet program services to qualifying households. requirements and ensure quality Semcac's rehabilitation specialists conduct outcomes. energy audits. its work crews insulate and weather-strip eligible homes and clean Access to Providing access to housing information and tune a home's furnace when and expertise is another strategy that necessary. Crews are familiar with the housing supports housing preservation. Related agency's other housing preservation information best practices include: working programs and refer eligible property and expertise collaboratively with other organizations, owners to them. supports housing identifying unmet information needs,and Finally,cities should periodically review preservation. tailoring information to meet those needs. their strategies to determine how well Example: As part of implementing a housing objectives are met. Effective program to license and improve rental evaluation reveals whether to modify or units, the Morris Housing Authority discontinue a strategy. became an information resource for landlords. Besides offering information about the rental program and available rehab financing, the Authority provided a sample damage-deposit form and a checklist to assess rental unit conditions. Offering useful information lessened resistance to the rental licensing program. The full report, Preserving Housing: A Best Practices Cities or their agents should use a variety Review (#pe03-05), is available at of means to communicate housing 651-296-4708 or: • information. People learn in different www.auditor.Ieg.state.mn.us/ ways and are looking for information at ped/2003/pe0305.htm Preserving Housing: • A Best Practices Review A CHECKLIST FOR MEASURING PERFORMANCE This checklist contains performance measures that cities and local housing organizations may use to evaluate their housing preservation efforts. We used some of these measures as the basis for developing questions for our two surveys and to develop a model of best practices. The measures also enabled us to identify cities and housing organizations with best practices in preserving housing. The next section discusses the importance of measuring performance in preserving housing. After that, we list some of the performance measures identified during the study. We present them in a checklist format for cities and housing organizations that want to assess their performance. Although we specifically discuss"cities"below,the information applies to other local housing organizations as well. THE VALUE OF PERFORMANCE MEASUREMENT Performance measures help cities determine whether they are meeting their goals of preserving housing and how well they are accomplishing their objectives. Assessing performance entails collecting and analyzing data on impact, efficiency,and cost-effectiveness of housing preservation activities. Performance data enable cities to make informed decisions about modifying or enhancing their housing preservation strategies. For example,trend data on the percentage of housing units that are substandard,the number of housing units rehabilitated,the level of unmet housing rehabilitation needs, and program costs, for example,can help a city determine how well it is meeting its objective of improving its existing housing stock. Trend data can also help cities plan strategically for their community's future housing needs. Even though performance measurement seeks to improve cost-effectiveness in preserving housing,measuring performance has costs of its own. Resources are needed to measure performance,which requires local policymakers' support. Each step in performance measurement—identifying goals and objectives, deciding on benchmarks to measure performance,recording the necessary data, and analyzing the data—requires an investment of resources in the form of personnel time as well as data-collection tools. Furthermore,performance measurement is not a one-time occurrence. Performance measurement is most helpful when it is conducted periodically,allowing comparisons over time. • 2 PRESERVING HOUSING: A BEST PRACTICES REPORT Defining a Mission, Goals, Objectives, and Measures To the extent a city has followed the best practices recommended in this report,it will have identified its mission in preserving housing and the goals and objectives of its housing programs during the process of thinking strategically about housing. Such a city can move directly to identifying measures and collecting data to assess its performance. However, if cities already have housing programs in place and want to evaluate them,they should first identify their overall mission in preserving housing. The mission describes the fundamental purposes of housing preservation, such as ensuring all residents have access to adequate housing. The mission is the foundation upon which goals,objectives,and performance measures are based. After defining the mission,cities or local housing organizations should set goals for preserving housing. Broad goal statements delineate what a city intends to achieve with its housing programs, such as maximizing the value of housing units as economic assets of the community. When developing housing preservation goals,cities may want to consider the four goals that are listed at the beginning of Chapter 2. Identifying their housing preservation mission and goals will help cities create program objectives. Objectives are directly related to the mission and goals,but they are more specific. They establish the specific housing preservation activities a jurisdiction aims to accomplish and by when. For example,an objective might be to reduce the number of boarded-up housing units within two years. Performance measures quantify the extent to which a city is meeting its objectives. There are four types of measures: outputs, outcomes,efficiency, and cost-effectiveness. Output measures quantify the amount of services provided. For example,in connection with the objective to lower the number of boarded-up housing units, an output measure is the number of boarded-up housing units removed from a city's housing stock. Outcome measures quantify the results of the services. A measure of outcomes related to the boarded-up housing objective might be residents' improved perceptions of the cities' housing. Efficiency measures quantify the costs of providing services, and are based on dollars, personnel, or time. An efficiency measure of this housing objective is the number of boarded-up units either abolished or returned to service per dollar expended. Cost-effectiveness measures quantify the costs associated with achieving desirable results. A measure of cost-effectiveness is the dollars spent for the improvement in resident perceptions. PERFORMANCE MEASURES FOR PRESERVING HOUSING • To identify performance measures for evaluating housing preservation strategies, we read reports from cities throughout the United States and various housing CHECKLIST FOR MEASURING PERFORMANCE 3 • publications, and we interviewed several housing organizations in Minnesota. In the following checklist,we converted the performance measures to"yes or no" questions to make it easier for cities to conduct a self-assessment. The measures are presented in an order that corresponds with the best practices recommended in Chapter 2. The following checklist is by no means exhaustive. Cities could track many other measures to evaluate their housing programs. Cities may choose to supplement the measures listed here with additional measures related to their own specific objectives. Even though each measure appears below only once, some measures may apply to more than one practice. For example,tracking the number of code violations voluntarily resolved as a percentage of all identified code violations applies to administering both local housing-related codes and the State Building Code. Checklist of Performance Measures Determine housing needs (p. 31 in Chapter 2) The following performance measures pertain to the best practices for identifying housing needs: collecting and analyzing information in the context of long-range planning and strategic thinking. Yes No A. Has the city assessed the overall number,age,condition,and C • appearance of housing units? B. Has the city identified the substandard housing units in its C ❑ jurisdiction,by owner-occupied and rental units if appropriate? C. Has the city determined the percentage of the housing stock p p that is boarded up or abandoned? D. Does the city monitor the percentage of condemned(for p 1 health and safety reasons)housing units in its jurisdiction? E. Has the city analyzed the neighborhoods in its jurisdiction to learn what is encouraging or discouraging private investment in existing housing (including data on the history,property conditions and values,housing needs,housing policies and programs, and real estate market)? F. Has the city assessed whether local ordinances and policies G J are hindering private investment in housing preservation? G. Has the city identified its housing needs? p H. Has the city set priorities among its identified housing needs? p _1 • 4 PRESERVING HOUSING: A BEST PRACTICES REPORT • Yes No I. Has the city assessed residents' satisfaction with the Cl ❑ residential property conditions in the community? J. Does the city have a comprehensive strategic plan with a ❑ housing component that(1)specifies the role housing preservation will play in achieving broader housing objectives and(2)identifies the impact of other community factors on housing preservation? K. Do local leaders view housing as one piece of a larger picture ❑ on community development? L. Has the city considered how changes in its demographic makeup will affect its housing needs? Determine appropriate responses (p. 37 in Chapter 2) The following performance measures gauge a city's progress in setting housing objectives,evaluating their feasibility, and selecting appropriate responses for meeting housing needs. They also apply to nurturing local leaders' support and planning for public infrastructure investments. Yes No A. Have local leaders set housing goals for the city,including • goals for preserving housing? B. Have staff identified a wide range of possible strategies to C. meet the city's housing goals and considered the appropriateness of those responses given local circumstances? C. Has the city weighed the need for direct public interventions ❑ against that for indirect incentives to encourage private sector activities? D. Has the city estimated the ongoing costs of the different ❑ -7 strategies and assessed its ability to implement them? E. Has the city set implementation plans for the housing ❑ strategies it adopts? F. Does the city make strategic and ongoing investments in community infrastructure(e.g., streets, sewers, sidewalks)? G. Has the city considered the political feasibility of its potential C responses and engaged local leaders? Administer housing-related codes (p.43 in Chapter 2) • These questions will help cities with local housing-related codes measure how well they facilitate voluntary compliance with their local code requirements and CHECKLIST FOR MEASURING PERFORMANCE 5 • ensure consistent enforcement. They also address having a variety of enforcement options and targeting enforcement resources. Yes No A. Does the city track the number and types of constituent L complaints regarding property maintenance? B. Are the requirements of,and standards in, local L J housing-related codes easily accessible to property owners who are subject to the codes? C. Does the city track the number of housing units inspected for L code violations as a percentage of all housing units (and track rental units separately as needed)? D. Has the city created a range of enforcement strategies for p p code enforcement, including incentives for early compliance and increasingly severe sanctions for continued noncompliance? E. Is an acceptable percentage of code violations resolved ❑ L through voluntary compliance? F. Has the city established targets for the amount of time that ❑ ❑ should pass between when a complaint is filed and when an • inspection is conducted? Does the city monitor the degree to which it meets the target? G. Has the city established timeframes within which violations L ❑ should be resolved,and does it monitor the degree to which the timeframes are met? H. Does the city have written policies and procedures to guide ❑ L staff in areas such as the standard to which properties should be inspected, what type of enforcement action to pursue, and when to escalate enforcement action? I. Does the city target its housing inspection programs if it has ❑ ❑ insufficient resources to inspect all housing units? J. Does the city measure the efficiency of its enforcement 1-- ❑ activities, such as by monitoring the number of hours spent per inspection and the number of inspections per total staff (including administrative staff people),distinguishing among types of inspections as appropriate? K. Does the city measure the outcomes of its enforcement ❑ ❑ activities, such as by monitoring the percentage of inspections resulting in identified code violations and the percentage with violations that are brought into compliance with code • requirements,distinguishing among types of inspections and violations as appropriate? 6 PRESERVING HOUSING: A BEST PRACTICES REPORT • Yes No L. Does the city measure the cost-effectiveness of its C; enforcement activities, such as by monitoring the number of agency person-hours spent on code violations brought into substantial compliance or the median number of reinspections conducted before compliance is achieved,distinguishing among types of violations as appropriate? M. Has the incidence of homeowner property insurance claims J due to fire or water hazards declined? Administer the State Building Code to support housing preservation (p. 52 in Chapter 2) For cities that have adopted the State Building Code, the measures below help to evaluate the extent to which they appropriately administer the code. The measures involve whether the building official publicizes code requirements,has streamlined the permit process, offers technical assistance, and considers compliance alternatives that meet the intent of the building code. Consistency in applying the code is also addressed. Yes No A. Does the city have handouts that clarify building code J J requirements for different types of work on existing buildings? • B. Does the building official offer information to make J contractors aware of requirements of the building code and acceptable compliance alternatives for work on existing buildings? C. Does the building official offer preplan reviews for interested J J clients and log the number of plan reviews performed? D. Does the building official have checklists to perform plan J reviews and inspections consistently? E. Does the building official consider compliance alternatives J that meet the intent of the code when needed for work on existing buildings? F. Does the building official periodically review staff work to C J monitor consistent application of building code requirements and use of compliance alternatives that meet the code's intent? G. Has the building official established timeframes within which J �J to complete plan reviews and issue building permits? Does the official monitor the building office's success in meeting the timeframes? • CHECKLIST FOR MEASURING PERFORMANCE 7 • Yes No H. Has the building official established simplified and expedited ❑ ❑ permit application processes for routine work on existing buildings (e.g.,projects that do not require plan reviews)? I. When the building official or building inspectors review each ❑ ] others' work,is a high proportion of plan reviews and inspections found to be thorough and consistent in applying code requirements? J. Does the building official measure the outcomes of providing ❑ ❑ information and technical assistance by, for example,keeping track of the volume of questions the building office receives or the number of building-code violation notices it issues? K. Is a large percentage of code violations corrected through ❑ ❑ voluntary compliance? L. Are follow-up inspections completed on a timely basis? C' 1 Provide access to financial assistance (p. 61 in Chapter 2) These measures gauge a city's ability to provide access to financial assistance for rehabilitation by forming partnerships with other agencies,developing its own capacity to administer financing programs,managing rehabilitation risks,and • identifying prospective clients. Yes No A. Has the city assessed whether it has the capacity to award ❑ ❑ financial assistance for housing preservation? B. Has the city explored partnerships with other organizations ❑ that have housing expertise? C. Does the city maintain a database containing the number of ❑ ❑ applications reviewed and processed(for each finance program)? D. Does the city provide application assistance(e.g.,answering ❑ ❑ inquiries,providing preliminary inspection)to potentially qualified applicants within a reasonable number of working days? E. Is a high percentage of units rehabilitated within a reasonable I ❑ time between application for assistance and completion of the work? F. Is the city satisfied with the level of private funding or -] ❑ in-kind services that is leveraged by public dollars, distinguishing between owner-occupied and other types of units as appropriate? • 8 PRESERVING HOUSING: A BEST PRACTICES REPORT • Yes No G. Does the city monitor the percentage of scheduled loan Y repayments made on time and loan default rates? Are these measures at acceptable levels? H. Does the city have a system for determining client eligibility for the various housing financial assistance programs? I. Does the city have in place a system to monitor project plans C p to ensure compliance with program requirements (e.g. correcting health and safety hazards)? J. Does the city conduct on-site monitoring following rehab work(to determine whether work was satisfactorily completed and conduct follow-up activities)? K. Does the city control the risks of rehab projects such as L through initial inspections to identify needed work and payments to contractors after work is completed satisfactorily? L. Does the city measure its programs' outputs, such as tracking p 7 the number of clients served and the size and number of grants and loans,distinguishing among types of housing and assistance? SM. Does the city measure program efficiency, such as the C' average number of hours spent per reviewed application? N. Does the city measure outcomes of financing programs, such n as percentage of targeted housing units receiving full rehabilitation? O. Does the city measure the cost-effectiveness of its programs, C_ such as by monitoring the amount of public dollars and total dollars spent per rehabbed unit? P. Do staff collect and analyze housing information to determine Li J whether there is a need for the financial assistance? Q. Is customer satisfaction with staff competence and courtesy at P a high level? R. Is the city able to identify potential clients for the housing ❑ assistance programs? Has it established a means to communicate with them? • CHECKLIST FOR MEASURING PERFORMANCE 9 • Offer access to information(p. 67 in Chapter 2) The measures below help evaluate how cities provide housing preservation information and expertise. Yes No A. Have city staff explored partnerships with planners, funders, f.. 1 nonprofits, social service agencies,and/or coalitions with nearby jurisdictions? B. Have staff identified how housing information needs differ for different constituents (or prospective clients)? C. Is housing-related information available in a variety of ways, such as hard copies of written materials, on-line postings, in-person consultations at housing fairs,or cable television? D. Does the city measure the outputs of its housing information programs, such as the number of people to whom the city distributed written housing preservation information,the number of people receiving a visit from a rehab specialist,the number of technical assistance seminars or workshops conducted, or the number of people successfully completing seminars or workshops? • E. Does the city track the efficiency of its information activities, ❑ ❑ such as measuring public dollars and total dollars spent per person completing housing-information workshops? F. Does the city measure the outcomes of its information ❑ J activities such as the percentage of housing preservation projects undertaken by people receiving housing information? G. Does a large percentage of clients rate highly the housing ❑ J information they received? H. Does a high percentage of clients rate highly the knowledge C and ability of program staff? I. Do clients rate the length of time they participated in an ❑ ❑ initiative as appropriate? S 10 PRESERVING HOUSING: A BEST PRACTICES REPORT • Offer access to direct housing preservation services (p. 72 in Chapter 2) These measures relate to a city's decision to ensure that housing repair and rehabilitation services are available to its residents. Yes No A. Is a high percentage of rehabilitated units sold or rented within a reasonable time from their purchase? Do the new owners or renters of rehabilitated units maintain them? B. Do staff document program inputs, such as the number of ❑ ❑ hours spent(including administrative time)by program? C. Do staff monitor program outputs, such as tracking the -� ❑ number of projects completed(e.g.,repairs, septic tanks pumped,fences erected)or the number of housing units it has purchased,rehabilitated,and sold or rented within the jurisdiction? D. Do staff track the efficiency of their services, such as the ] [.:] number of clients served per staff person or the number of rehabbed units per staff person? E. Do staff track the outcomes of repair or rehabilitation J ❑ • projects, such as increasing the percentage of deficient housing units receiving comprehensive weatherization? Evaluate housing strategies (p. 74 in Chapter 2) The measures a city uses to evaluate its housing strategies will relate directly to the goals the city has set. The following measures relate to the goals identified in Chapter 2. Yes No A. In cities with local housing-related codes,is an increasing ❑ ❑ percentage of housing in the city compliant with local code requirements? B. Does the city measure how well its housing strategies meet its ] ❑ housing goals? C. Can the city detect changes in individual property values as 1 ❑ determined by assessors' estimated market values of improvements? D. Are elected leaders and staff receiving fewer complaints _7 ❑ about the city's housing or has a survey shown improved resident satisfaction with the condition of the city's housing? E. Are government housing programs creating"spin-off ❑ ❑ • investment"or additional residential investments? CHECKLIST FOR MEASURING PERFORMANCE 11 • Yes No F. Has the city improved the diversity of its housing stock, e Li allowing it to retain households that might have otherwise moved and attract new households to the area? G. Is the city's residential property tax base sound? Li [i H. Has the percentage of the city's housing stock that is boarded J Li up or abandoned declined? I. Does the city have a low incidence of substandard housing units,owner-occupied and other,in its jurisdiction? J. Has the overall appearance of housing in a city's jurisdiction J L improved? K. Are clients surveyed to determine their overall satisfaction J ❑ with the city's housing programs or services? L. Are the measures suggested in earlier sections showing Li ❑ satisfactory progress toward meeting the city's housing goals and objectives for existing housing? • " "." M May 16,2003 ro M ;., a THE BUSINESS JOURNAL I twincities.bizjoumals.com 6 Public funds boost affordable housing BY NICOLE GARRISON STAFF REPORTER New public incentives are drawing more developers into affordable multifamily hous • ing. While it's a trend low-income housing ai t s� advocates would like to see continue, some y wonder just how long the building boom can t continue. In the past year or so, government groups j; f such as the Metropolitan Council,the Dakota s County Community Development Agency and the Minneapolis Community irlr Development Agency(MCDA)have reallocat ed resources to ensure that more money is available to build affordable housing than r , �,• ever before. €� This January, the MCDA, the housing and K ` economic redevelopment arm of the city of r,- =* `- Minneapolis,issued a$4.7 million request for f proposal for its Multi-Family Rental Program • t - � funds.A total of 30 proposals were received, t • representing over $196 million of develop- �3 ment cost and over 1,639 units. The total *mount requested from the MCDA exceeds $14 million, which is more than the agency •- t A can fulfill. - , This was the most positive response the agency has seen since it began offering the t M �- , funds, said Cynthia Lee, manager of multi- f `r * } ,� �l" family housing development at the MCDA. f }:_� .s The increase in interest in affordable housing , funds stems from an increase in the number - f -K•of funds into which developers now can tap. N `"� a ''P The money allocated for these programs,at t 0 k 4 )/;;._ � �_ least in Minneapolis, also is increasing. In R jk. 2001, MCDA allocated $8.1 million in direct gr'r '� a . a funds, bonds and tax credits for affordable ,0 �, � ��� *r` Vie` housing. In 2002, that number increased to p - � {# g $10.8 million and is expected.to jump to `., r almost$15 million this year. The increased funding has made a differ ence. From Burnsville and Chaska to V a Minneapolis and St. Paul, metro-area multi ^ r '`� .„ .: rg `P� ' ct c family housing projects that once consisted 7" .'i entirely of market-value units are now more f ' „ , � it � likely to include some sort of affordable hous- S - ing component. t, „ K _ , In 2001, the MCDA financed 1,149 multi- DIANA WAITERS I THE BUSINESS JOURNAL family assisted units. Last year the agency The city of Minneapolis gave Steve Minn's company,Lupe Development Partners, closed on 2,143 multifamily low-income a tax break for including affordable housing in Stone Arch Apartments. units. . IltifIn the past five years,1,134 of the 2,342 mul- Minneapolis, which were developed by units built in Dakota County were Minneapolis Stone Arch Partners,a joint yen- " MORE... amily affordable housing units. A large portion of ture between Lupe Development Partners Funding available to developersbuilding'af , those units were developed recently and The Wall Cos.,both of Minneapolis. t .fordable housing ` "We've seen a significant increase in afford- "The logic behind that ordinance is gold Multifamily Rental Program fund,issued by MC able housing production in the county," said plated,"said Steve Minn,project principal for DA $4.7 available in 200 Mark Ulfers,executive director of the Dakota the Minneapolis Stone Arch Partners. "We Direst funds,bonds,and tax credits,issuedfby Community Development Agency. "That certainly used that at Stone Arch." MCIDA,$1 b million available in 2003 activity has occurred because of additional Stone Arch included 92 affordable units out Tax•Gnctement financing,issued at'city level funding resources." of a total of 221 rental units—46 more than Low-income housing tax credits,issued by MCDA According to a 2001 report, commissioned what was required by the city. Housing revenue bonds,issue by MCf A- by the Family Housing Fund, more than Metro-area counties also have added fund- .Housing Trust Funds,issued at county level' - 25,000 new affordable rental units and 7,000 ing for affordable housing development in the State and federal money earmarked for affordable affordable ownership homes were needed by seven-county metro area. For example, a housing 2006 to house the region's workers who earn number of counties now offer Housing Trust between$15,000 and$50,000 a year Funds. These funds are formed when local Affordable housing development incentives. governments mark certain sources of revenue Looser stipulations on private activity bonds. = Incentives to be used solely for affordable housing. Minneapolis city ordinance granting 2t percent The city of Minneapolis recently passed an "In the past you didn't see county funds in tax break •ordinance that gives developers a 20 percent the metro area," Ulfers said. "Counties have .Zoning variances tax break for putting affordable housing in the always been involved in the administration of City services fee breaks projects. That ordinance was a factor in the federal and state money, but the advent of construction of the Stone Arch Apartments in AFFORDABLE I PAGE 21 '4'4'4-441e*''41tJ'':'4UfJit:-'7-n'Ir?,-iw*e„tt *—='—'t1Y-*-",-"A0-11.4.; ': .,:!-It.. : „111:-,- DIANA WAITERS I THE BUSINESS JOURNAL 1 '_‘ , , - „, iligio'iiii, The Ninth Street Lofts offer 10-foot ceilings and customized furniture. _ footage found in many single-family homes STREET LOFTS S -7 :',.-.',`-`,NV=''‘''i,''-',, ,4-4-- t ';-'4 401,.•.; ' ,., in that community but hardly excessive by NINTH-.., , ., 7,1‘.:..,,,,,•.'4W4:=',;,,,•‘.04.'i-..---,,,`•-'.'".Z.,''',,,,t,-,,,,,,-- -,-,, ,..:,_:„. :.;-.,6-,, .,.;,-;‘,, - ,,, townhouse standards. Some developments st , .Paul ,. Group_, ,:isivtIt qpii,,i ,,......t. in the region sell units in excess of 5,000 :PeveloP011-:Pletand,1 ,..?., "!, -. ''-411,13U- ' -, square feet. . thas:49;lbrsalei At Hartford. Commons in Eden Prairie, a ,,,,,pSicicueas7$'116:89,g066,:04.f.!,11.1l,„.;,,7ttI,!:ie;„1/:.,„.41zP:1!.. . ,t ;e,. ,, :i.t ,,.1.:::,,,,„.....; ,,,,,,,ir.,,,„ . ontictii::a:rt:-- 318-townhouse development by David ''P c't,Pgirl9-Y,:.: , ...„_, , ,r- ,..... Economic Development Bernard, selling features include lofts that Late 2004,,,,,,,,,,,,.:,..,„ -4`..-.4at,;:,'...,";,t,-,•:',U, • -' '-'• -pf-.,..,-4....• . , can be used for home offices and second 1,,,,-:,,,,-- ,:;',:,, •",!,1,-.,ily.r.:0,,,:-:.;:i,../- ,,,-..41:,..;.,4,7„,:z„,7:if,r71,77,":" bedrooms,brushed chrome appliances and a , Eau Claire non big master bedroom with a walk-in closet the outdoors,Fefercom said.As Develop orr s a result,the - and attached bathroom, said Madsen: Maplewood development has extensive 3625 Gateway DriN, "Everyone wants enough room for a-Icing- porches or decks on every townhouse unit. EicLAIRE Eau Claire, WI 547 sized bed,"she said. . R 1 ' 715-834-0070 OEVELOPMENT Suburban buyers also want a private link to ,Frank Jossi is a St Paul-based free-lance writer. . _ Fax: 715-834-195€ ,,— , ,., edcnate@ecol.net ,_ __ OFIMATION AFFORDABLE: Budget cuts could hurt subsidies . ,.„,, ,“. .•.-,_: ,- ,,,„ ,-- ,,.. FROM PAGE 19 at all. - -- - "Generally speaking,with today's regula 0 c 1 ally dedicated resources for affordable i ry environment,the private sector cank afford housing is a newer phenomenon." to build affordable housing without some sort More money is available at of subsidy,"said Rick Packer,a project manag- the state level as well,Ulfers er With Arcon Development Inc.in Edina and . _ ?''-7"--, said.During the last-bienni- chair of the developer's council for the i'''.,_:-•"s..--,',--..-;.„0,,,,;-,., 1 urn, the Legislature appro- Builders Association of the Twin Cities. P riated some money to help Developers usually spend mom than w ith the bwiding of afford- $120,000 on financing,land and construction able housing.Two years ago, to build a 1,000-square-foot affordable unit, . 1 the Legislature loosened Minn said.Rent on such a unit would have to. stipulations on private activ- be at least$1.25 per square,ideally$1.35,to -„, 1 A T -r, it Ulfers ity bonds to make them offset those costs.To be affordable,however, V V _ _, u $1.10 a s exceed$1 not must more accessible to develop- rent mus no ex . qare foot'and ---- ------ 1 ers building affordable housing.This resulted is ideally between that figure and 95 cents. ,i in an increase in bond financing for multi- Without subsidies,developers would have to family housing,Ulfers said. eat the cost of the difference. , .4...., The increase in the number of affordable "If you couldn't get that rent,you wouldn't , . sign i units needed,and you wouldn't ' 'ts built in the metro area is a sign that get the return you . „ .... 1 those additional incentives have,helped. In- build these units," Minn said. "Subsidies are addition to Stone Arch,other new multifami- the bridge that allow developers to expand lay housing projects with significant affordable their offerings to include units that are be ow 1 components include the Bottineau Housing, market value." . Project in northeast Minneapolis. Using tax- But, developers and government-officials. exempt bonds,developer SherrnanAssociates wonder how much longer these fundsd for p Inc.made 87 of the project's 156 rental units affordable housing will be available. Bu get , Whether affordable: cuts and belt tightening at all levels of govern- About 30 percent of 808 Berry, a 267-unit ment might reduce the funds that have been tenant i . rental property in St. Paul, will comprise built up over the years. knowledge affordable rental units.Financing for the proj- "I we'll continue to see some activity in . Include de ect,developed by Dominium Development& affordable housing,but not at the same e level," To make us Acquisition,m' cludes tax-increment financing Ulfers said."I think what we've seen in. the past 14, from the city of St. Paul and funds from few years has been somewhat of a blip." LI' Ramsey County. Without subsidies, developers say they liganison@bizjoumalszom1(612)288-2112 would be unable to build affordable housing . . , .., - . . 4110 , .