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CGMC, GMNP meet with city officials on housing issue

Representatives of the Coalition of Greater Minnesota Cities (CGMC) and Greater Minnesota Partnership (GMNP) held a discussion with city officials regarding Greater Minnesota housing concerns on Tuesday at the Jay C. Hormel Nature Center.

Austin city officials were present, as were officials from Mankato, Red Wing, St. Peter and other Greater Minnesota cities.

“We appreciate that they’re listening to their members about the reality of housing challenges in a community like Austin,” said City Administrator Craig Clark.

Bradley Peterson, Executive Director of the CGMC, shared the results of a housing survey conducted earlier this year. Peterson said the survey consisted of 105 responses from 71 communities, including Austin, throughout Greater Minnesota. Almost half of those communities that responded consisted of populations less than 5,000 people.

Of the communities that responded, 49.52 ranked housing as a “high concern.”

“It’s definitely amongst the top three (concerns), if not the leading challenge,” Clark said. “We definitely concur with that finding.”

The lack of workforce housing, particularly affordable workforce housing, also ranked high on the list of concerns.

“In some respects, as those (workforce housing) units are created, that also opens up affordable housing units as well,” Clark said. “In that respect, workforce and affordable housing go hand-in-hand.”

Other concerns cited included aging housing stock and lack of senior housing.

Sixty percent of responders said they are more concerned about the lack of single-family housing, which stand in contrast with Austin. Clark attributed it to the small populations of many of the responders.

“(Austin is) a little more interested in trying to address the multi-family need,” he said. “While the single-family homes are lower than we’d like to see, they have increased with the (tax) abatement program. We really haven’t seen the creation of much in the line of multi-family units. We’re seeing some activity now, but we definitely need more production on that end. In a community of 2,000, your whole community is by and large single-family homes; there are not going to be many multi-family apartment complexes in a town of 2,000.”

Austin was in agreement with the majority of responders in calling for the CGMC and GMNP in taking an active leadership role in addressing housing concerns.

“We’ve been chief amongst those at the table pushing our organizations, whether it be the Coalition of Greater Minnesota Cities or the Greater Minnesota Partnership or the League of Minnesota Cities, to make housing a greater priority on their legislative platforms,” Clark said.

The survey related what programs were being employed by Greater Minnesota cities to alleviate the housing shortage. The two most frequently used programs were tax increment financing (TIF), which is used by 63.82 percent of responders, and tax abatements, used by 37.14 percent.

“It’s important to note that those are local incentives,” Clark said. “That’s by and large where a lot of these projects are falling, on the local governments to try to deal with the housing problem. We need more participation from the state on these projects, not have them be shouldered exclusively on the municipalities.”

City officials in attendance discussed ideas to address housing concerns. One such idea mentioned by Austin officials was to help streamline the tax abatement process.

“Right now with our housing tax abatement program, there has to be a public hearing with all three taxing jurisdictions,” Clark said. “(We asked) if there would be a way to simplify that, if they have a standing adopted policy that the approvals could be made through one public hearing instead of going through essentially more hoop-jumping for those approvals.”

Other ideas discussed included tax increment financing for redevelopment of blighted areas, a workforce housing tax credit, increased housing funding, and adjusting for income threshold increases on properties that only rent to individuals that make less than a certain income.

The CGMC and GMNP plan to take ideas shared to the Minnesota Legislature during the 2020 session.

“I think the biggest difficulty for us is having the folks in St. Paul understand the realities of the housing challenges in Greater Minnesota, so having that be part of the discussion is greatly appreciated,” Clark said.