Yesterday, MPHA leaders presented an update on the agency’s 2024 housing levy budget along with submitting MPHA’s new, board-approved five-year levy capital plan to the Minneapolis Board of Estimate and Taxation (BET). Receiving the first of two levy payments from Hennepin County on July 5, MPHA staff has done significant pre-work throughout the year to enable quick deployment of the funding on various preservation and new-unit production activities. The second levy payment is anticipated to be delivered at year-end.
Highlights from the agency’s 2024 levy budget includes dedicating a portion of funding towards the agency’s next major high-rise renovation, two scattered site infill projects (one duplex and one triplex), and modernizing elevator systems in two high-rises.
“We are happy to report the progress MPHA has made in deploying these critical housing levy resources,” said Abdi Warsame, Executive Director/CEO of the Minneapolis Public Housing Authority. “The five-million-a-year levy funding is a 25 percent boost to MPHA’s annual HUD capital funding, and the agency has no shortage of needs to support its preservation and production work. We hope to continue to build the trust of state and local officials through education and transparency to demonstrate MPHA is a strong partner to help deliver high-quality, affordable homes to our community’s most vulnerable populations.”
Looking ahead to the agency’s proposed five-year (’25-’29) capital plan, highlights include:
- Additional resources to support major redevelopment projects at four high-rises. Also includes creating 15 new deeply affordable units.
- A scattered site family housing upzoning project. Tentatively, upzoning five sites to sixplexes (30 new family units).
- Major capital improvements at numerous high-rises. Work will include replacing and/or repairing windows, boiler systems, and elevators.
- Beginning resident engagement in 2026 to co-create a plan to preserve, redevelop, and/or add to the Glendale community.
Historically, HUD has only provided about 10 percent of the funding necessary for major building improvements. That means each year the agency is forced to choose band-aid options to triage leaky roofs, repair and maintain brick façades, replace inefficient 60-year-old windows, or improve decades-old high-rise electrical and plumbing systems instead of more comprehensive—albeit more expensive—solutions. Over time, this problem has only compounded, creating the agency’s current capital backlog of $260 million in needs.
In recent years, agency staff have pursued and maximized just about every tool possible to address this funding gap. This includes seeking special budget permissions from HUD to develop localized solutions, creating new public-private partnerships to leverage debt financing for major renovation projects (while maintaining strong guardrails to protect residents and public ownership), accessing project-based funding supports at every level of government, and pursuing one-time and ongoing financial supports from state and local governments, like the housing levy.
In 2023, MPHA secured more than $11 million in state and local support for its preservation and production activities, supplementing the $20 million in capital funding the agency received from HUD—a 55 percent funding boost for critical capital improvement work.
In addition to agency leaders reaching a long-term funding agreement with city leaders last year to resuscitate a long-dormant housing tax levy at $5 million annually, recent state and local support includes a $4.9 million investment in the City of Minneapolis’ 2023 budget, a one-time cash grant of $5 million as a part of the state legislature’s 2023 billion-dollar housing budget, a one-time $1.3 million grant from Minnesota Housing’s Stable Housing Organization Relief Program (SHORP), and a $1.35M award from the state’s Publicly Owned Housing Program (POHP).
