HomeMy WebLinkAboutHousing & Redevelopment Authority Minutes 03-28-197417
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AGEADA
PLYWITH HUM ADVISORY COMMITTEE
THURSIDAY, MARCH Z8, 19?4
7:30 P.M.
I. Call to Order by Chairman
WHERE: Council Chambers
Public Works Building
14900 23rd Avenue North
Plymouth, Minnesota 55441
2. Presentation/Discussion with Representatives from Three Suburban HRA's
3. Distribute Additional Houslog Information by Staff (to Toclude PUD Tour
Guide)
4. Work Session on Study Areas
S. Adjournme t
Roger Barnes, Chairman
Plymouth Housing Advisory Committee
Martin W. Overhlser and Milt Dale,
Project Coordinators
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PLY140M HOUSING ADVISORY COMMITTEE
March 28, 1974
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A resular meeting of the Plymouth Housing Advisory Committee was called to
order by Chairman Roger Barnes at 7:35 p.m. in the Council Chambers of the
Public Works Building, 14900 23rd Avenue North.
MEMBERS PRESENT; Chairman Barnes, Harold Bekke, Mrs. Barbara Edwards,
James tide, Howard. Hunt, Delano Erickson, Ronald Raschke
MEMBERS ABSENT: Mrs. Ruth Ault, William Leeper, Jr., William Rova
ALSO .PRESENT: Sue Hess, St. Louis Park Planoting Dept, and HRA; Dennis
Daniels, Director of Bloomington HRA; and Phil Hagedorn,
Director of Hopkins HRA
STAFF PRESENT: Martin Overhiser, Milt Oale
Call to Order by Chairman
Chairman Roger Barnes introduced the threeguest speakers to the Committee --
Sue Hess, reprdsenting ft St. Louis Park Planning Department and HRA;
Dennis Daniels, Director of Bloomington's HRA; and Phil Hagedorn, Director
of the Hopkins HRA. Chairman Barnes stat -,J that the three representatives
would give a brief description of their MRA activities and then the Committee
would be allowed to ask them questions.
Presentation - Discussion with Representatives from Three Suburban HF.A's
Sue Hess led the discussion off and explained the apartment leasing program
presently in use in St. Louis Park. She mentioned that St. Louis Park got
into the leasing program initially on the guarantee that they would build a
230 -unit housing project with HUD funds. She stressed that the leasing program
had been very successful in St. Louis Park in that there was no stigma
attached as there may be in a. housing project where all families are assasmed
to be welfare recipients. Presently, tenants' contribution is 25 percent of
the family income with Ms. Hess having interviewed about 200 persons interested
in the rent leasing progAam. She stated that on the average 20-25 aersons
make application per month, with two months beingthe longest most people
will wait to find out 1f an apartment is available.
Roger Barnes of the Committee wanted to know if St. Louis Park's housing
program was geared to the elderly. Sue Hess indicated that it was to some
degree geared to smaller families of one or two children or elderly persons
due to the difficulty of finding two and three bedroom apartments,
Mr. Csrnes also wanted to know if St. Louis .Park is paying out anf tax monies
to supplement the leasing program. Ms. Hess stated that all the funding was
by HUD; however, recent HUD requirements state that a municipality should
select families that can best afford to pay if the local HRA is in any
financial trouble. She also said that other HUD requirements caa cause some
difficulties for a municipality, as one requirement states that a municipality
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should estimate the number of units it would need. After this determination
was made. HUD indicated that this estimate w;uld be the maximum number of
units allowable. in addition, applicants must show a complete financial
statement to justify their eligibility for any rent supplements. She said
this nas not caused any problem as, out of 118 families, only one case of
an incomplete financial statement was returned.
She did state that onee problem in St. Louis Park is getting people into the
program as housing units become available. St. Louis Park has been making
every attempt to publicize their housing program and, even with this publicity,
they do not have a long waiting list.
Phil Hagedorn said that in his estimation the elderly housing problem in the
Metropolitan area is pretty well in hand. At one time Minneapolis had a
waiting list of 3,000 persons. This waiting list is now down to 500 persons
and they are accepting nonresidents as well. Hopkins presently has a waiting
list of some 60 persons. He also indicated that HUD is changing some of its
criteria in regards to applicant eligibility, with length of time on the
waiting list not the sole criteria, but other factors also to be considered
by the local HRA9 i.e. rent paying ability of applicant, hardship conditions,
percentage of income going for housing and whether applicant had been replaced
from his housing by public action.
Mr. Nagedorn said the challange now is to provide new and better ways to
house low and moderate income families. Sue. Hess interjected the comment
that the difficulty of finding available three and four bedroom units in
existing construction did create a housing vacuum for larger families and
in St. Louis Park they are waiting for the construction of their new
building to help.alleviate this problem.
Councilman Hunt said that Plymouth had been vera interested in getting an
elderly housing project in its community, but was considered to be too far
away from such things as bus lines and business activities to be eligible.
Congressman Frenzel had indicated at that time that it would be 10 to 15
years before Plymouth would be eligible to receive an elderly housing project.
Dennis Daniels of Bloomington stated that Plymouth and Bloomington had alot
In common as both communities had a considerable amount of open space left
in their community. In Bloomington they are presently funding their public
housing projects through a mill levy with 16 single family houses under
construction by Marvin Anderson Construction Company. These houses are in
the'$28-30,000 selling range, no garage, while their estimated value on the
open market would be $369000. Chairman Barnes wanted to know if a windfall
profit would result when these houses were sold the second time. Mr. Daniels
stated that the Bloomington HRA has right of first refusal, which means that
the HRA is allowed to be the first purchaser of the home once it goes back on
the market. The HRA would then be required to pay the owner the inflationary
value of the house plus interest on the investment and improvements, but not
the market value as would be the case if the house were put up on the open
market. This right of first refusal terminates after a ten-year period;
however, at that time the inflated value would not result in any windfall
profit for the owner.
He also indicated that HRA screens applicants carefully in an attempt to get
persons most.in need into public housing. Persons that have their own house
now. unless it was a very small inadequate house with a family with a number
of children,, would not be considered eligible. Also, families could have no
more than $5,000 to assets with the requirement that the applicant must
live or work to Bloomington. He stated that the price of land is not included
in the selling price of the house, with these lots for the houses scattered
throughout the city. In his estimation, the houses were well built and
included all appliances except a garbage disposal, had hardwood doors and
trim. and should be relatively maintenance free for some. time.
Dennis Daniels indicated that the problem now -is one of more than just
providing housing for low and moderate intone families. but it also is a
problem of providing housing to middle income families as the price "of
new housing has skyrocketed to such a high lavel. The average price of a
new hmuse in Bloomington has now reached the $50,000 mark.
A question was raised by the Committee where. St. Louis Park would be building
its new public housing project. Sue Hess said that it would be near the
Westwood Shopping Center and it would be a four-story apartment -like structure
with Hammel. Green and Abrahamson as architects. This building would be
owned by a business group who would receive the rents and pay off the cost
of the building over a period of time to be spelled out in their contract.
A question arose as to whether the elderly prefer living in high rise
apartment complexes where they are somewhat removed from the community and
in a surrounding that is definitely project orientated. Phil Hagedorn stated
that it has been his experience that the elderly do enjoy the high rise type
living and this has been proven in Minneapolis and other communities as well.
The convenience of being close to friends without having to leave the building
Is an important consideration. for this age group.
Dennis Daniels stated that any housing program in a community should be a
balanced one with high rises, leasing subsidies, townhouse developments,
single family homes and others, all available to a wide range of ho:sing
prospects. He also felt that a community should not let the Met Council
or HUD dictate housing guidelines. With each community defining its own
program and guidelines, it is in a better position to address itself to
its particular problems. Bloomington will be in the process of evaluating
its total housing needs this summer and would like to work with Plymouth
to identify their housing needs as well. Mr. Daniels felt that staff inter-
action in this problem would be beneficial to both communities. Councilman
Hunt said that Plymouth is attempting to mix housing and economic levels
through Planned Unit Developments and feels this is a viable approach.
Phil Hagedorn indicated that Hopkins is not comparable to most of the suburban
communities in that it is primarily an older town on the fringe of Minneapolis
that got caught up by the suburban growth movement. This has created some
problems unique to Hopkins and it is probably oni reason they have gotten
into senior citizen housing in a bigger way than other suburban communities.
Presently they have 76 units of senior citizen housing in a seven -story
building turn key) and ten families in a low rise building. These programs
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were designed so that rents were expected to pay operating costs; however,
this has not been entirely the case. The average monthly rent paid in the
public housing program is about $44 per month with one person paying as
low as $6 per month for rent. Last year Hopkins needed only $1,300 in
subsidy money from HUD to keep its housing program going. At present, no
residence requirement is necessary, .but most people have come from Hopkins
or the western suburbs. One of Hopkins most successful projects has been
an 11-story high—rise on Excelsior Avenue and Sixth Street that has paid for
itself primarily with real estate tax gains and supplemented with Federal
funds. Hopkins has also worked with Minnetonka in processing an application
for federally funded housing, but with the moratorium on housing, there is
little chance Minnetonka will be eligible for any new building at this time.
He feels the overall public housing picture is rather bleak presently, as
with the Federal moratorium, state and local governments do not have the
financial resources to make a significant impact in the public housing field.
Dennis Daniels stated that in Bloomington it took several years of preparatory
work before the first applicant got placed in a subsidized housing unit.
He did further indicate that if the Bloomington NRA had started its mill
levy in 1960 they would now be in a very advantageous position to finance
much more significant housing projects. The mill levy that is in effect
at ttis time in Bloomington was started about three years ago and now has
an $80,000 surplus. He has found that Bloomington citizens are much in
support ofHRA activities with only two or three complaints having been
received in his office over the last couple years.
A comment by a Committee member in regards to tax delinquent land provided
some discussion on this issue with Mr. Daniels stating that he did not
believe that a city could use such tax delinquent land for housing as it
would probably not be construed by the courts as a use for public interest.
However, he did stress that a municipality could well go to the state legis-
lature and have special legislation passed that would allow tax forfeited
land to be used for public housing. He stated that there are other ways of
acquiring land in a municipality to reserve it for tow and moderate cost
housing, and presently Bloomington has established a nonprofit land bank
with a goal of acquiring some 700 acres for a moa of a variety of housing
units for all income levels. Councilman Hunt it;.i=cated that Plymouth has
attempted to request that developers provide ten percent of their develop-
ments to be geared for low and moderate cost housing. Dennis Daniels
questioned whether this approach would be constitutional; however, he did
feel that it would be worth trying.
Some questions were raised by the Committee in regards to Bloomington's
land bank project with Harold Bakke wondering how this project would work
over the long haul. He believed that some developers who were on the fringe
of the land bank area would be in a poor position competitively than those
developers who had land in the land bank. Mr. Daniels said this problem
could be overcome by exchanging land so that developers on the fringe could
acquire land within the land bank in exchange for land they had outside of
this area. However, he did concede that all the problems that could arise
have not been worked out and that it would be a difficult task to assemble
and develop this project in its entirety, but felt the ultimate objective
made such an effort worthwhile.
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A question from the Committee to Mr. Daniels was what a community should be
doing first if they wanted to come to grips with the present housing dilemma.
He said that the first thing would be to establish a NRA, then establish a
mill levy and to define housing needs.
Phil Hayedorn said that rehabitation programs are not presently available
through the state financing agency. He did believe that while Hopkins did not
use a mill levy system, it was a good tool. However, he felt that each :•or.runity
had to make its own decision as to how to provide for public housing. One
way that Hopkins used was a tax increment financing program to acquire land.
In this manner a housing mix can be achieved with the NRA at present the
best tool to perform this function.
The question arose as to whether PUD's were a good way of reducing housing
costs. Dennis Daniels stated that in Bloomington's experience they were not,
and often in that community they were more expensive than normal housing and
did nothing to lower housing costs as such. However, he was not opposed to
PUD developments and the providing of a good mix of housing types and densities.
PUO's, he felt, often worked to the advantage of the developer with the eventual
buyer of the home receiving no cost break.. In this regard, Phil Hagedorn said
that the Westbrook PUD has worked very well. Dennis Daniels added that developers
often just used PUD's so they can increase the density on a givenparcel of
land and thereby increase their own profit margin.
A discussion ensued regarding the Met Council's policies and its recent
formation of a Meet Council HRA. Both Daniels and Hagedorn were in opposition
to the Met Council's creation of an area -wide HRA and, in this regard, Mr.
Daniels said that in his opinion, local communities should take a strong
stand against those Met Council policies that just do not appear to crake
sense. He also believed the Met Council had every right to rap communities
when they do aot provide the right type of housing programs or when their
policies do not appear appropriate. Couir lman Hunt said that in regards
o HRA's, most suburban communities would prefer to use established HRA's
in other communities through a contractual agreement rather than depend on
a Met Council HRA. Both Mr. Daniels and Mr. Hagedorn said that they would be
very agreeable to assisting Plymouth in establishing its own NRA. This informa-
tion would be made available to the Plymouth City staff at their request.
Barb Edwards of the Committee wanted to know if senior citizen projects have
to be totally subsidized, as she indicated her mother was living in a project
in Minneapolis which did not seem to be totally subsidized. Phil Hagedorn
said,"No", that under the old 236 program some -ieople would pay market rent,
some paid partial rent, with the rest of the rent being subsidized.
Committee discussion then centered on who would compose a local HRA. In
Hopkins' case, Mr. Hagedorn stated that there were five members on the Board
of Commissioners, none of which are members of the Council, but are appointed
by the Council; while in Bloomington, three Council members sit on the HRA
Board, with the rest of the members appointed by the Council. Both Hagedorn
and Daniels indicated that the HRA and the Council should have a good working
relationship if the HRA is going to be effective however, a HRA as presently
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established under state statutes does have real powers of its own such as the
power of condemnation. This is unlike other appointed commissions in municipali-
ties,,
Dennis Daniels felt that Plymouth should make a real effort to acquire the
Minneapolis .Workhouse property for low and moderate cost housing. This would
be done by going to the Mayor of Minneapolis and urging him to provide this
property to the City of Plymouth. Some Committee discussion resulted in
regards to Daniels'proposition, with a question being raised as to what the
utility assessments were on this property. Councilman Hunt stated the assess-
ments were $750,000 with the land value estimated at some $2,000400.
Committee members were uncertain whether Minneapolis would freely donate
such a substantial sum to City of Plymouth .
Distribution of Additional Housing,Informatioo.by Staff
Martin Overhiser passed out additional housing information relative to the
following. items:
1. A Housin Re ort from the Met Council on PUDs (February, 1974).
2* Wusing costs as determined by- William ge , Extension Housing
Specialist, 11niversity of Minnesota (December, 1973).
3. Your Housing Alternatives - Getting the Most From your Housing Dollar
rIcultural Extension Services University of Minnesota.
4. Balancing _Your Housing Needs and Resources, William Angel, Agricultural
Extension Sery ce, University of Minnesota (1972).
5. Tour Guide to Housing in Plymouth, staff report.
Discussion took place on the planned tour of housing in Plymouth scheduled for
Sat:irday morning at 8:00 a.m. and a show of hands indicated that Councilman
Hunt, Chairman Barnes, Jim Eide and Del Erickson would likely be on that tour
along with one of the staff members. As well, John Doyle would be in attendance.
Work Session Study Areas
Chairman Barnes said that as it was getting late in the evening, it would be
better to work on which study areas Committee members should be assigned to
at another date rather than attempt to do it at this meeting. It was decided
that a meeting should be held on Thursday, April 4 at 7:30 p.m. at which time
the Committee would concentrate on this one area of assignment to subgroups.
Chairman Barnes wanted Committee members to think about which group of the
four groupings they would wish to be assigned to.
Adjournment at 10:45 p.m.
k..
oger Barness Chairman
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Frartin Overhiser an Milt Dale,
Project Coordinators