In a financial boost to the housing-strapped city of Minneapolis, the City Council recently green-lighted a sizable investment geared towards affordable housing. The approved funds totaling $18.3 million are set to create or preserve 876 affordable housing units across nine projects within various city wards, as reported by the Minneapolis official news outlet.
The investment consists of $16.8 million in direct financing and another $1.5 million in federal tax credits through a 10-year period. This financial push aims, to not only bolster housing availability but to serve as a catalyst for over $341.4 million in combined private and public resources. Mayor Frey applauded the action saying, "Minneapolis has been leading the nation in our affordable housing production – and the Affordable Housing Trust Fund is a big part of that body of work," expressing gratitude to the community planning team and emphasizing the benefits of stable housing to residents' well-being.
A disturbing statistic reveals that almost 75% of renters are burdened by costs exceeding 30% of their income, a challenge that these funds intend to mitigate, particularly amongst low-income renters defined as those with incomes at or below 50% of the Area Median Income (AMI). According to the announcement, the disproportionate impact felt by Black, Indigenous, and People of Color in the realm of housing instability lends an increased importance to initiatives like this one.
Amidst the housing ache, Council Member Lisa Goodman highlighted the significance of the city's contribution, stating, "This allocation will assist in building over 876 affordable homes in Minneapolis, a third of which are deeply affordable (up to 30% AMI)." The funding, a manifestation of the city's Affordable Housing Trust Fund and Federal Low Income Housing Tax Credit programs, focuses on both equity and gap financing necessary for the production and preservation of affordable multifamily rental housing. Meanwhile, continuing the commitment into the following fiscal year, Mayor Frey's 2024 approved City budget will include an additional $18 million for the Affordable Housing Trust Fund.
The recent council meeting also announced a preliminary allocation for housing tax credits. Projects included are the rehabilitation and new construction of the St. Olaf Exodus Building in Ward 7, which promises 66 supportive housing units for those battling homelessness or at risk. The earmarked tax credits are expected to generate more than $14.5 million in equity for the project alone.
Beyond the rehabilitation and new construction efforts, the AHTF funds are also facilitating mixed-income housing, preservation of family units with a focus on inclusivity, senior housing, and mixed-use developments. Each investment aims to alleviate the strain on struggling families and contribute to a more robust, equitable housing landscape in Minneapolis. With the ripple effect of each dollar spent purported to amplify funding eighteenfold, according to Council Member Goodman, the prospects for significant change are tangible, as Minneapolis looks forward to more habitable structures arising on its horizon.
