Preserving MPHA’s Family Homes
Unlocking new federal dollars to fund home improvements and preserve our public housing
Why is MPHA using a different HUD program for these homes?
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 much 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 will bring at least $3 million annually in additional federal housing subsidy (and perhaps considerably more) to serve the lowest-income renters in Minneapolis. This is a very big deal for the city and the families we serve, enabling these homes to be preserved for the long term.
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?
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 do not need to move, why does the application refer to “relocation”?
We realize that this terminology used by HUD can be confusing, 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).
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.