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Organizations ask for $430 million to address Minnesota's housing crisis

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ST. PAUL — With Minnesota needing to build thousands of homes to address an affordable housing shortage, a diverse statewide coalition of organizations on Tuesday, Jan. 22, announced an ambitious and expensive agenda at a state Capitol news conference.

Their proposals call on state policymakers to borrow and spend more than $400 million over the next two years on a broad range of programs to provide affordable homes for workers, renters, the homeless and older Minnesotans.

“This is by far our boldest ask yet,” said Fatima Moore, policy co-chair of Homes for All, a coalition of more than 200 nonprofit, business, local government, health care and education organizations advocating for building and preserving more housing.

While their plan carries a hefty price tag, DFL Rep. Alice Hausman, of St. Paul, chair of a new House housing panel, said there’s growing, bipartisan recognition among lawmakers of the need for more affordable housing. She said lawmakers approved selling $100 million in housing bonds in 2014 and an additional $87 million last year, setting the stage for a more aggressive package now.

The coalition’s wish list is based on recommendations made last year by then-Gov. Mark Dayton’s housing task force, which cited a need to build 300,000 new homes by 2030 across all types, prices and locations to stabilize costs and meet demand. The report found that more than 550,000 Minnesota families spent at least 30 percent of their incomes on rent or mortgage payments, leaving little left over to cover such necessities as groceries and transportation.

What they are seeking

The Homes for All agenda includes:

  • Borrowing $300 million to build and preserve housing across the state. Much of that money would go to build affordable rental housing for working families. It also would provide funds to repair and preserve public housing and supply emergency housing for the homeless.

  • Appropriating $55 million to the Minnesota Housing Finance Agency to produce more homes for workers, match local housing resources, help families buy homes and prevent homelessness.

  • Providing $50 million in tax credits for investments in a fund that offers money for locally directed affordable housing projects.

  • Allocating $25 million to the state Department of Human Resources to provide emergency shelter and support services for homeless families and housing assistance for people with severe mental illness.

Housing where the jobs are

State Sen. Carla Nelson, R-Rochester, said the tax credit fund would help solve a “workforce crisis” across the state caused by workers’ inability to afford housing in communities where the most in-demand jobs are located. The credit would encourage local businesses and labor to invest in solving their communities’ housing needs, she said.

The Homes for All agenda will have to compete with numerous other groups for a share of the state’s projected $1.5 billion budget surplus for the next two years.

Moreover, DFL legislative leaders have warned that much of the surplus will be needed to cover inflationary costs of existing programs, and Republican leaders contend the surplus should be returned to taxpayers.