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Home My WebLink About6.e. Adoption of Affordable and Life-Cycle Housing Goals for 2021-2030 EXECUTIVE SUMMARY City Council Regular Meeting: September 1, 2020 AGENDA ITEM: Adoption of Affordable and Life-Cycle Housing Goals for 2021-2030 AGENDA SECTION: Consent PREPARED BY: Anthony Nemcek, Planner AGENDA NO. 6.e. ATTACHMENTS: Resolution; 2021-2030 Affordable and Life-Cycle Housing Goals Methodology APPROVED BY: LJM RECOMMENDED ACTION: Motion to adopt a resolution affirming the City’s affordable and life-cycle housing goals and reenrolling in the Livable Communities Act program. BACKGROUND The City has been a recipient of funds through the Livable Communities Act (LCA) program that is administered by the Metropolitan Council. In order to be eligible for LCA funding, cities must adopt affordable and life-cycle housing goals every ten years. These goals are determined by a methodology that is consistent across communities within the Metropolitan Area and cover the 10-year planning cycle. A summary of the methodology used is included in the attachments. Below is a comparison of the City’s approved affordable and life-cycle housing goals for 2011-2020 and those proposed by the Metropolitan Council for 2021-2030. Decade Affordable Housing Goal Life-cycle Housing Goal 2011-2020 700-1,000 1,000-2,678 2021-2030 431-783 1302 In order to re-enroll in the LCA for the 2021-2030 decade, the City Council needs to adopt the goals from the table above. RECOMMENDATION In order to continue being eligible for LCA funds for future projects, staff recommends the Council adopt a resolution affirming the City’s affordable and life-cycle housing goals and stating the City’s desire to continue participating in the LCA. CITY OF ROSEMOUNT DAKOTA COUNTY, MINNESOTA RESOLUTION 2020-XX RESOLUTION ELECTING TO PARTICIPATE IN THE LOCAL HOUSING INCENTIVES ACCOUNT PROGRAM UNDER THE METROPOLITAN LIVABLE COMMUNITIES ACT CALENDAR YEARS 2021 THROUGH 2030 WHEREAS, the Metropolitan Livable Communities Act (Minnesota Statutes sections 473.25 to 473.255) establishes a Metropolitan Livable Communities Fund which is intended to address housing and other development issues facing the metropolitan area defined by Minnesot a Statutes section 473.121; and WHEREAS, the Metropolitan Livable Communities Fund, comprising the Tax Base Revitalization Account, the Livable Communities Demonstration Account, the Local Housing Incentive Account and the Inclusionary Housing Account, is intended to provide certain funding and other assistance to metropolitan-area municipalities; and WHEREAS, a metropolitan-area municipality is not eligible to receive grants or loans under the Metropolitan Livable Communities Fund or eligible to receive certain polluted sites cleanup funding from the Minnesota Department of Employment and Economic Development unless the municipality is participating in the Local Housing Incentives Account Program under Minnesota Statutes section 473.254; and WHEREAS, the Metropolitan Livable Communities Act requires that each municipality establish affordable and life-cycle housing goals for that municipality that are consistent with and promote the policies of the Metropolitan Council as provided in the adopted Metropolitan Development Guide; and WHEREAS, a metropolitan-area municipality can participate in the Local Housing Incentives Account Program under Minnesota Statutes section 473.254 if: (a) the municipality elects to participate in the Local Housing Incentives Program; (b) the Metropolitan Council and the municipality successfully negotiate new affordable and life-cycle housing goals for the municipality; (c) the Metropolitan Council adopts by resolution the new negotiated affordable and life-cycle housing goals for the municipality; and (d) the municipality establishes it has spent or will spend or distribute to the Local Housing Incentives Account the required Affordable and Life-Cycle Housing Opportunities Amount (ALHOA) for each year the municipality participates in the Local Housing Incentives Account Program. NOW THEREFOR BE IT RESOLVED that the City of Rosemount : 1. Elects to participate in the Local Housing Incentives Program under the Metropolitan Livable Communities Act for calendar years 2021 through 2030. 2 2. Agrees to the following affordable and life-cycle housing goals for calendar years 2021 through 2030: Affordable Housing Goals Range Life-Cycle Housing Goal 431-783 1302 3. Will prepare and submit to the Metropolitan Council a plan identifying the actions it plans to take to meet its established housing goals. ADOPTED this 1st day of September, 2020, by the City Council of the City of Rosemount. _________________________________ William H. Droste, Mayor ATTEST: ___________________________________ Erin Fasbender, City Clerk 2021-2030 Affordable and Life-cycle Housing Goals Methodology Months of cumulative outreach and discussion about how 2021-2030 affordable and life-cycle housing goals should be calculated (summarized at a May 4 Communities Development Committee meeting), has led to a methodology that is consistent and easy to understand. The selected methodology attempts to strike a reasonable, balanced approach that considers the variety of differing circumstances across communities. The 2021-2030 affordable housing goals will be a range to reflect the uncertainty and variety of local affordable housing development, and use a similar approach that 2011-2020 goals used. How were 2011-2030 affordable housing goals calculated? In 2009 and 2010 broad discussions were had about how to determine 2011-2020 affordable housing goals, including some of the same stakeholders - and even some of the same people! - that provided input for the coming decade’s goals. In summary, an estimate of available funding for affordable housing was determined for the 2011-2020 decade and used to calculate what percent of the decade’s need for affordable housing could possibly be developed. This percentage was calculated at 65%, which was then applied to each community’s share of affordable housing need for 2011-2020 to create a low end of an affordable housing goal range. The high end of a community’s goal range was the need number itself. Some communities had access to additional funding sources and therefore the low end of their range was increased, but most communities’ 2011-2020 affordable housing goal was a range between 65% and 100% of their 2011-2020 share of affordable housing need. How are 2021-2030 affordable housing goals being calculated? Affordable and life-cycle housing goals are calculated based on each community’s share of the region’s need for affordable housing in the coming decade. Each community has, or is in the process of, updating their comprehensive plans to acknowledge this “need” number, which is based on their forecasted sewer-serviced growth, their existing affordable housing choices relative to the regional average, and whether or not they import or export low-wage workers. Forecasted growth considers a community’s transit capacity, land use guidance, employment growth, and other economic and demographic trends. “Need” numbers are further adjusted as described above to encourage affordable housing development that will provide reasonable housing options at all incomes throughout the region. Determining affordable housing “goals” (which are required for LCA participation) based on affordable housing “needs” (which are required to be addressed per the Metropolitan Land Planning Act) ensures that those goals factor in all the unique characteristics of a community. However, it is widely acknowledged that there is not sufficient funding available to meet the forecasted affordable housing “need,” and affordable housing goals are an opportunity for cities to consider a more realistic, if still ambitious, number of affordable housing units that could be built in the coming decade. For this reason, the amount of funding anticipated for affordable housing development in the coming decade is the primary consideration in determining affordable housing goals. Working closely with Minnesota Housing, we have estimated that funding in 2021-2030 could support the construction of about 45% of the forecasted need for affordable housing. We must acknowledge that not every source of affordable housing funding is captured in this calculation. We also acknowledge that there are many things individual local governments can do to incentivize and partner with affordable housing developers to increase their chances of accessing available funding. Finally, many focus group participants and survey respondents indicated a desire to set goals above minimum funding limitations as an incentive to do more. For this reason, we have set the low end of your community’s 2021-2030 affordable housing goals at 55% of your share of the region’s need for affordable housing (also known as the “need” number in your comprehensive plan). That percentage reflects the funding availability estimate (45%), plus an additional 10% to account for local policies and less common funding sources. Shown another way: We heard from survey respondents and stakeholder conversations that funding has historically limited our ability to meet all affordable housing needs, but many partners – both cities and other stakeholders – felt that affordable housing goals should also reflect the future need. There is no penalty for not meeting affordable housing goals, and equating “goals” with “needs” may incentivize us to work harder to address affordable housing needs and bring attention to the need for more funding to create resilient communities where housing choices are robust. For that reason, the high end of your community’s 2021-2030 affordable housing goal is equal to your 2021-2030 affordable housing need number from your comprehensive plan. For example, if your share of the region’s need for affordable housing in the coming decade is 100 units, your goal range would look like this: How were 2011-2020 life-cycle housing goals being calculated? Life-cycle housing goals were also considered in partnership with communities and stakeholders in 2009-2010. In summary, life-cycle housing goals were also determined as a range. The low end of the range was the 2011-2020 share of affordable housing need. The high end of the range was calculated by multiplying all land guided multi-family residential AND expected to develop in the 2011 decade by the maximum densities of those land uses. This resulted in some very high life-cycle housing goals! How are 2021-2030 life-cycle housing goals being calculated? Life-cycle goals are intended to ensure communities are allowing for a variety of housing types; specifically, a mix of densities within their residential land. Although all communities must allow minimum average residential densities for sewer serviced growth, and additional average density minimums near certain transit investments, this measure is more about knowing how many multi-family units are possible. Therefore, life-cycle goals are being measured by looking at all multi-family land uses (defined as land uses with a minimum of 8 units per acre or more), and multiplying the acres of land expected to develop in the coming decade by the median density of those multi-family land use designations. Shown another way: