Preserving Single-Family Homes

Unlocking new federal dollars to fund home improvements and preserve our public housing

Why is MPHA using this HUD program?

MPHA needs to maintain and update its more than 700 family homes (single-family, duplex, and fourplex) across the city. To preserve these homes, MPHA has been approved for a HUD program known as Section 18.

The program will give MPHA more money to take care of these units of public housing. HUD’s approval communication to MPHA states:

The disposition will result in the preservation of this valuable low-income housing resource that would not continue to be viable as public housing. The units will continue to be operated as low-income housing units utilizing a project-base voucher (PBV) funding platform. About half of the units are in relatively low-poverty areas and will serve as a particularly positive resource to advance residents’ economic opportunities… The MPHA will not realize proceeds from this disposition… All residents will be able to remain in their units using PBV assistance and no residents will be displaced.

MPHA estimates that our approval  bring  at least $3 million annually in additional federal housing subsidy to serve the lowest-income renters in Minneapolis!

What does this mean for residents?

In general, families should experience little change. MPHA’s commitments to families follow our board-approved Guiding Principles:

  • MPHA’s use of this program does not eliminate, reduce, or privatize any public housing.
  • Long-term legal protections will guarantee the homes serve only low-income families.
  • You will not lose your housing benefits.
  • MPHA will still be your property manager.
  • The income-based rent calculation will remain at 30% of adjusted income, the same as now.
  • Converting our subsidy for these units does not mean families have to move. 
  • You may experience more improvements and repairs to your home over time with the increased funding.

How does the new program work?

  • STEP 1: APPLY

    Since current federal funding is not enough to operate and maintain housing long-term, MPHA applied in March 2019 for HUD’s Section 18 program for a portion of our portfolio (our “scattered sites”). Prior to the application, MPHA sent information about the program to all affected households and invited them to one of three meetings for information and feedback.

  • STEP 2: MPHA-OWNED NONPROFIT

    MPHA applied under Section 18 for “disposition,” which in our case means MPHA will transfer the properties (for $1 each) to a public nonprofit 100% controlled by the housing authority. Residents will sign a new lease with this nonprofit, which is called “Community Housing Resources,” or CHR. The change will otherwise have little impact for most residents.

  • STEP 3: FUNDING

    The approved Section 18 application leads to a large increase in the subsidy amount, which allows MPHA to improve and rehab the housing.

  • STEP 4: CONVERSION

    MPHA will convert the subsidy into project-based vouchers (PBVs). PBVs are attached permanently to the scattered-site house and operate much the way public housing currently operates. MPHA will continue to property-manage this family housing through the nonprofit.

Which properties are not included in this program?

Our townhome properties (the Glendale Townhomes and Minnehaha Townhomes) were not included in MPHA’s application for this program, which is specifically designed to address  “scattered sites.” (Townhomes are not scattered sites, per HUD’s definition.) Similarly, 19 units of MPHA’s current scattered site housing do not qualify because they consist of more than four contiguous units. (MPHA originally included these units in our application; as anticipated, however, they were not approved on this basis.) Like our townhomes, MPHA will continue to operate these units as public housing.

MPHA’s highrises are also not included in this application. MPHA has applied for a different federal program called the Rental Assistance Demonstration for one highrise.

If residents don’t need to move out, why does the application refer to “relocation”?

We realize that this terminology, required by HUD, can be confusing, especially because the intent of our application is to keep families in their homes. References to “relocation” expenses in MPHA’s application and approval letter refer only to the signing of a new lease (which is a required step in the conversion process). In our application, MPHA estimated administrative staff costs of assisting families with this process at $70,656 (around $100 per household), and HUD expects us to complete it within 180 days of approval barring any unexpected delays.

Will there be any effect on rent or eligibility?

We expect most families will see little change in rent and no effect on eligibility. The rent calculation will still be 30 percent of your adjusted income (the same as today, under traditional public housing).

There may be special circumstances for a small number of households with the highest incomes, who currently pay MPHA’s maximum rent amount (also known as “flat rent”). However, no change would happen for many months. MPHA will be directly in touch with these households well in advance of any change, and provide transitional assistance if necessary.

If you are a resident who would like more information, your property manager is your best resource. If you are not sure how to reach your property manager, email ContactMPHA@mplspha.org and we will be glad to help.