Today, Minnesota State Senator Zaynab Mohamed and Representative Hodan Hassan announced a new effort to send MPHA a one-time cash grant of $35 million to repair the agency’s portfolio of more than 700 deeply affordable family homes. This new legislation (HF 4169/SF 4020) is a continuation of an effort that began last legislative session, where the agency sought $45 million in one-time funding. Minneapolis Mayor Jacob Frey joined the announcement to endorse the new legislation and tout recent investments the City of Minneapolis has made in MPHA, including restoring the long-dormant housing levy, delivering the agency $5 million annually.
Last year, MPHA received a direct one-time cash grant of $5 million as a part of the legislature’s billion-dollar housing budget. In combination with new funding from the City of Minneapolis and a one-time $1.3 million grant from Minnesota Housing’s Stable Housing Organization Relief Program (SHORP), MPHA now estimates the capital backlog of its deeply affordable family housing portfolio to be $33 million. The agency is returning to the state legislature with an updated request that reflects the more than $10 million recently invested in the portfolio, hoping to secure the remainder of the funding necessary for MPHA to overcome decades of underfunding from HUD and set the portfolio up to become self-sufficient for decades.
“This updated legislation is proof that we can address the affordable housing crisis through state, local, and federal partnership,” said Abdi Warsame, Executive Director/CEO of the Minneapolis Public Housing Authority. “Together, we are making real progress towards stabilizing the lives of hundreds of families currently living in these homes while also ensuring thousands more families can access the life-altering force of stable, deeply affordable housing for generations. Thank you to Senator Mohamed and Representative Hassan for championing this effort. It cannot be overstated how transformational this investment would be for MPHA families and for the future of our entire region.”
“Everyone deserves a place to call home,” said Senator Zaynab Mohamed (DFL-Minneapolis). “That’s why we’re investing $35 million in Minneapolis public housing. It’s not just about having a roof over your head; it’s about a home that provides a life of dignity and opportunity for every Minnesotan. Housing is an asset not just to the people who live there, but to our whole community. This crucial funding will help us protect and expand our city’s public housing and move us toward a future where everyone is housed with dignity.”
“Minneapolis has a housing affordability and availability crisis,” said Representative Hodan Hassan (DFL-Minneapolis). “Housing must be treated like a universal human right. Years of underinvestment meant lack of resources to maintain and update affordable housing units and build new ones. Many of the people who need these affordable housing units are BIPOC and women-led households. It’s time to clean up the backlog of work that needs to be done so we can ensure more Minnesotans have stable, affordable housing.”
“Every person deserves safe, stable, and permanent housing,” said Minneapolis Mayor Jacob Frey. “Minneapolis is leading the nation when it comes to investing in and producing affordable housing and a big piece of the housing continuum is our public housing stock. To meet the need, we have increased our ongoing commitment to MPHA to $5 million annually – and I cannot stress enough the importance of having all levels of government step up too. This $35 million would positively impact thousands of individuals and families in our city. Let’s get it done.”
Through the agency’s wholly controlled non-profit, Community Housing Resources (CHR), the agency owns and operates more than 700 deeply affordable single-family, duplex, fourplex, and sixplex homes spread across every legislative district in the city, serving more than 3,100 people. The homes are often referred to as MPHA’s “scattered site” housing. These homes account for more than 80 percent of the MPHA housing available for families with children. Of the residents who call scattered site properties home, 88 percent are black, 86 percent are female-led, and nearly two-thirds are households of five or more—families with children.
These scattered site homes are a critical piece of city infrastructure, as they are a proven tool to provide families a solid foundation for upward mobility. Of the current scattered site heads of household, 19 percent were employed when entering their new home. On average, these residents earned $20,722 a year in income. Today, 70 percent of these residents are employed, earning an average of $37,321 a year, with more than 60 percent of these residents’ earned income increasing while in these homes. Better yet, since 2020, nearly 16 percent of all families leaving scattered site homes have gone on to purchase their own homes. Families living in CHR homes stay for an average of six years before moving to new housing.
There is a major need for this type of housing in Minneapolis, as evidenced by the agency’s recent highwater mark of more than 7,500 people on its waitlist for deeply affordable and/or public family housing. More than 80 percent of those on the waitlist are households of color. To help meet this unmet need, the agency recently celebrated the grand opening of 84 new deeply affordable family homes with its Family Housing Expansion Project (FHEP), bringing 26 two- and 58 three-bedroom units in fourplexes and sixplexes to 16 sites across Minneapolis.
Preserving this critical portfolio of deeply affordable family housing is a top agency priority. The portfolio’s current backlog of capital needs stands at $33 million. If left unaddressed, the need becomes $70 million by 2034. Currently, the agency is committing more than $2 million annually into capital repairs into the portfolio, but that investment is insufficient to address the portfolio’s needs. If left to only MPHA’s annual contribution, over the next 10 years, the portfolio of homes will end up in worse condition than they are today and will be in jeopardy of becoming uninhabitable.
With this new $35 million investment, the agency would complete work over a four-year span, covering both today’s capital backlog and future capital needs while driving towards portfolio self-sufficiency by the end of the four-year deployment window. Because of the $10 million investment in the portfolio this past year and the prep work necessary to deploy that funding, the agency has developed an expedited deployment window for this year’s $35 million request compared to the 10-year window from last year’s $45 million request.
This proposed investment would transform deeply affordable family housing in Minneapolis for a generation. While the agency estimates the capital backlog for its entire portfolio at $229 million, the ability to resolve an additional $35 million of work over the next four years on top of the annual funding it receives from HUD and other jurisdictions would mark one of the most significant improvements in the agency’s capital backlog in MPHA history.
2024 MPHA Family Housing Capital Investment Request Presentation
HF 4169/SF 4020 One-Page Fact Sheet