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COUNCIL MEETING DECEMBER 11, 1995 affordable alternative housing for employees and for customers of newly developed commercial areas. Affordable and rental housing are areas which raise the biggest issue with Met Council. Staff is suggesting a deviation on home ownership patterns. Affordable housing are homes that are affordable to households having an income of 80% of median or lower. Met Council has determine the standard is equivalent to a home having a value of $115,000.00 or less. The current Lino Lakes index indicates that the City has 68% of its owner/occupied housing that qualifies as affordable. The Met Council is suggesting a benchmark for Lino Lakes of 68% to 69% of the housing stock. Staff is concerned about this benchmark because between 1990 and 1994, the new single family homes constructed in Lino Lakes have been considerably higher than the $115,000.00 value. Staff feels this trend is going to continue and to set a goal as suggested by Met Council may not be attainable and seen as unfavorable in the City's approach to the Livable Communities act. Staff discussed this concern with Met Council staff and they suggested that the City establish a goal that is comfortable for the City and that could be verified. Staff is suggesting a 54% goal. This would suggest that the City would let the market dictate what is current in the community. This means that the City has not taken the position that affordable owner -occupied housing will be discouraged. The City will continue to look at additional townhomes and alternative housing types. This goal will also leave room for growth in the single-family homes for upper income families. Reasons why Lino Lakes should pursue the 54% goal are the housing values in the most recent years have been higher than $115,000.00 in value and Lino Lakes ordinances continue to promote environmental protection. Environmental concerns have produced lower density residential areas which creates higher values. Although there is some townhome development in the City, the market appears to continue to be predominately single family homes. Staff also questioned if nearly 70% of the Lino Lakes housing stock were to be affordable, who is the City trying to benefit? The target group of the Livable Communities Act are the low and moderate income families. Staff conducted a survey using 1990 Census information and identified what the 80% median income qualified and how many households were below the median income. The survey showed that the proposed goal would represent 36% of the household count in the entire region. Staff felt establishing a housing ratio of almost 70% while 36% is the target group was very unusual and very high. The current statistics indicate that numerous Lino Lakes residents may be living in housing below what they can afford and the new housing stock provides some "move -up" opportunities. Staff recommended that the affordable owner occupied housing goals be 54% of its owner occupied housing stock. Ms. Wyland contacted Met Council today and explained the information presented this evening. Met Council asked the City to provide specific information regarding new housing values that have been occurring. PAGE 8