Investments & Incentives for Maintaining Affordability

4d Programs. Local governments can create or expand their existing 4d program to offer property tax breaks in exchange for owners maintaining the affordability of a portion of their units for 10 years

Affordable Housing Trust Funds. Local housing trust funds are a reliable and flexible resource for supporting a range of different local needs and priorities for preserving and enhancing NOAH.

NOAH Preservation Funds. Local governments can establish and expand funds to assist eligible buyers (typically mission-based non-profit owner-operator) to acquire and preserve NOAH properties that are at risk of losing affordability.

Funding for Reinvestment & Rehabilitation

Capital and operating subsidies. Local governments can offer subsidies, grants, and other cost supports to help property owners reinvest in and maintain older buildings.

Tax Incentives & Low-income housing tax credits. Local governments can provide tax incentives to building owners who invest in rehabilitation projects and allocate low-income housing tax credits to developers who rehabilitate NOAH buildings and keep them affordable.

Enforcement, Engagement, and Coordination

Creating supportive relationships. Local governments can proactively meet with existing NOAH property owners to provide resources for tenant protections, safety, and building maintenance issues before there is a problem.

Supporting with carrots rather than sticks. Work with property owners on code violations and provide access to financial or technical support. This is particularly important for small family owners who have limited access to financial capital and technical resources

Swiftly Enforcing Code Violations. When there are serious code violations and limited response from owners, utilized existing local authority to remedy to protect property values, resident safety and neighborhoods.

Direct rental or income assistance. Local, regional and state governments can provide direct funding to assist households unable to afford the cost of rent or utilities. They can also provide direct income assistance to reduce the overall cost-burden of these households, such as guaranteed minimum income programs.

Tenant-based vouchers. Local and regional public housing agencies have the authority to issue tenant-based vouchers to households eligible for public housing in order to help them move into market-rate housing instead. Tenant-based vouchers can be especially effective for reducing segregation and other inequities in communities where there is no stock of public housing or deeply-affordable NOAH units in opportunity-rich neighborhoods. However, the Housing Choice Voucher program is significantly underfunded. Currently only one in four households who qualify for a federal housing voucher actually receive one. As such, public housing agencies should prioritize increased funding of vouchers and modify criteria to make the vouchers more market-friendly.

Enforcement of tenant and fair housing protections. Local governments can be more proactive and consistent in enforcing protections against unfair housing practices such as predatory rent pricing and discrimination. They can also provide or pay for legal assistance for tenants facing eviction or dealing with unsafe or unlivable housing conditions.

Elimination of Unnecessary Barriers to Production

Allowing Higher Density. Local governments can proactively eliminate density restrictions and allow higher densities by right in areas where such density is supported such as resource-rich neighborhoods.

Reducing Local Fees. Multiple impact and permitting fees add significantly to the incremental costs of producing additional units of housing. Local governments can review and modify local fees to reduce the impact on incremental costs.

Clarifying & Standardizing Approval Processes. Ambiguous approval requirements and processes can be legally and politically exploited by even a small minority of neighbors with NIMBY interests to stall new housing development projects. Local governments can prevent this by increasing the clarity and transparency of the approval criteria and process and by creating clear guidelines and regulations for developers to follow.

Relaxing Parking Requirements. Parking requirements can add significantly to the cost of new housing projects. Local governments can reduce or eliminate parking requirements when they do not match the needs of the neighborhood or development.

Public Investment in Housing

Expanded Use of Project-based Vouchers. Project based housing voucher agreements in new privately-owned and managed housing development ensures that those units are affordable for low- and extremely-low-income households. There is a financing advantage when public housing agencies guarantee the value of these vouchers in advance where the private developer can include their value in the financing structure for the development of new housing projects.

Flexible Tax Increment Financing. Local governments can create TIF districts, utilize pooled funds and issue bonds to pay for public costs necessary to support private development of new affordable housing. TIF utilization can be especially helpful for stimulating new housing development in communities and to secure commitments from developers to keep a certain number of units affordable for low- and extremely-low-income households.

Housing Trust Funds. Creating and dedicating state and local resources to housing trust funds can fill the gap created in the development of affordable housing production.

Regulatory Incentives & Relief for Qualifying Projects

Density Bonuses. Local governments can allow developers to build more units than allowed by the underlying zoning code in exchange for the commitment to keep a certain number of the units built affordable for low- and extremely-low-income households.

Expedited Permitting. Where a project meets community goals for affordability, reduce the approval process. Fast-tracking the permitting process for projects that meet community affordability goals can reduce development costs and speed up delivery of new units.

Simplifying legal negotiations. Income-restricted affordable housing projects that utilize tax credits and local/regional sources of funding tend to be complex deals involving multiple lenders and intermediaries and, as such, requiring multiple legal agreements and closing processes. Local governments, public housing authorities, and other public funding entities, including the state and the Minnesota Housing Finance Agency can work together to utilize a variety of instruments, such as intercreditor agreements, to simplify and align these legal agreements and processes in order to reduce costs and delays.