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HomeMy WebLinkAbout2010-073 Council Resolution411 Council Member Roeser adoption: • introduced the following resolution and moved its CITY OF LINO LAKES COUNTY OF ANOKA RESOLUTION NO. 10 -73 RESOLUTION ELECTING TO CONTINUE PARTICIPATING IN THE LOCAL HOUSING INCENTIVES ACCOUNT PROGRAM UNDER THE METROPOLITAN LIVABLE COMMUNITIES ACT, CALENDAR YEARS 2011 THROUGH 2020 WHEREAS, the Metropolitan Livable Communities Act (Minnesota Statutes sections 473.25 to 473.255) establishes a Metropolitan Livable Communities Fund which is intended to address housing and other development issues facing the metropolitan area defined by Minnesota Statutes section 473.121; and WHEREAS, the Metropolitan Livable Communities Fund, comprising the Tax Base Revitalization Account, the Livable Communities Demonstration Account, the Local Housing Incentive Account and the Inclusionary Housing Account, is intended to provide certain funding and other assistance to metropolitan -area municipalities; and WHEREAS, a metropolitan-area municipality is not eligible to receive grants or loans under the Metropolitan Livable Communities Fund or eligible to receive certain polluted sites cleanup funding from the Minnesota Department of Employment and Economic Development unless the municipality is participating in the Local Housing Incentives Account Program under Minnesota Statutes section 473.254; and WHEREAS, the Metropolitan Livable Communities Act requires the Metropolitan Council to negotiate with each municipality to establish affordable and life -cycle housing goals for that municipality that are consistent with and promote the policies of the Metropolitan Council as provided in the adopted Metropolitan Development Guide; and WHEREAS, previously negotiated affordable and life -cycle housing goals for municipalities participating in the Local Housing Incentives Account Program expire in 2010; and WHEREAS, a metropolitan-area municipality can participate in the Local Housing Incentives Account Program under Minnesota Statutes section 473.254 if: (a) the municipality elects to participate in the Local Housing Incentives Program; (b) the Metropolitan Council and the municipality successfully negotiate new affordable and • life -cycle housing goals for the municipality; (c) the Metropolitan Council adopts by • • • resolution the new negotiated affordable and life -cycle housing goals for the municipality; and (d) the municipality establishes it has spent or will spend or distribute to the Local Housing Incentives Account the required Affordable and Life -Cycle Housing Opportunities Amount (ALHOA) for each year the municipality participates in the Local Housing Incentives Account Program. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Lino Lakes that the City of Lino Lakes: 1. Elects to participate in the Local Housing Incentives Program under the Metropolitan Livable Communities Act for calendar years 2011 through 2020. 2. Agrees to the following affordable and life -cycle housing goals for calendar years 2011 through 2020: Affordable Housing Goals Range Life -Cycle Housing Goals Range 364 to 560 dwelling units 560 to 1,860 dwelling units 3. Will prepare and submit to the Metropolitan Council a plan identifying the actions it plans to take to pursue these housing goals. Ju is e Bartell, City Clerk Jeff Rein: , ayor Adopted by the Lino Lakes City Council this ( day of , 2010. The motion for the adoption of the foregoing resolution was duly seconded by Council Member Raf fert and upon vote being taken thereon, the following voted in favor thereof Roeser, Rafferty, O'Donnell, Gallup, Reinert The following voted against same: none Whereupon said resolution was declared duly passed and adopted. • AGENDA ITEM 6 D STAFF ORIGINATOR: Jeff Smyser C. C. MEETING DATE: September 13, 2010 TOPIC: Resolution No. 10 -73 Continuing Participation in Livable Communities Act Program, 2011 -2020 VOTE REQUIRED: 3/5 BACKGROUND The Minnesota Legislature adopted the Livable Communities Act (LCA) in 1995. This law assigned the program to the Metropolitan Council and created several accounts for funding specified activities. Through the use of competitive grants as incentives, the various funds provide assistance for housing, development, and redevelopment. In order to be eligible for these funding programs, a city must participate in the Local Housing Initiatives Account Program under the LCA. Lino Lakes has participated in this program since 1995 and has benefited from four grants totaling $1,645,000. Continuing with the program continues the City's eligibility for future grants, which is consistent with the City Council's direction to pursue additional grant funding. Under the law, participation includes the adoption of goals for life -cycle and affordable housing. The initial goal period ran 1996 -2010. To continue to participate in the LCA program, the City would establish new goals for the next ten years (2011- 2020). The old and new goals are compared below. New goals are to be adopted by September 1. Participation also requires the expenditure of a specified amount of money to support opportunities for lifecycle and affordable housing. The tax increment finance district within the Legacy At Woods Edge project is generating funds to service the bonds for the I -35W interchange and the intersection improvements at Town Center Parkway. These infrastructure improvements were needed for the Legacy project, which in turn created the possibility for the lifecycle housing within it. Because of this, the Met Council has agreed that the tax increment being spent meets the requirement of the LCA program. The increment will be ample to cover this requirement for years to come. In addition, LCA participation requires a Housing Action Plan outlining the steps the City will take to help meet the goals. Much or all of the Action Plan can be taken from the housing section of the draft new comprehensive plan. If the City Council chooses to continue LCA participation, staff will prepare the Housing Action Plan, which is due December 1. LCA Grant Funds and Grants to Lino Lakes • The LCA created the Metropolitan Livable Communities fund, which includes the following funding accounts. Eligibility for grants from these funds is an incentive for participating in the • • • program. Municipalities that elect not to participate in the LCA are not eligible for these grants, nor are they eligible to apply for funds under the Department of Employment and Economic Development's polluted sites clean -up program. In addition, the Metropolitan Council is required by the LCA to consider a municipality's participation in the LCA when making other discretionary funding decisions. Tax Base Revitalization Account (TBRA): This fund helps cities clean up contaminated urban land for subsequent commercial and industrial development, thus restoring tax base and jobs near existing housing and services. This program is conducted in coordination with the Minnesota Department of Employment and Economic Development. Livable Communities Demonstration Account (LCDA): This account funds development and redevelopment projects with development patterns that link housing, jobs and services, and that maximize the development potential of existing infrastructure and regional facilities. There are two grant categories. Development grants provide funding for basic public infrastructure and site assembly. Pre - Development grants assist with activities such as detailed redevelopment designs and economic feasibility analyses to prepare projects to compete for grants in the Development category. Local Housing Incentive Account (LHIA): This fund helps expand lifecycle and affordable housing development and preservation in the region. Grants awarded from this account must be matched by the recipient community with local dollars for affordable housing activities. Grants may be used for costs associated with projects that help municipalities meet their negotiated LCA housing goals. Inclusionary Housing Account (IHA): This fund supported affordable housing developments in which the reduction of local controls and regulations resulted in reduced development costs. It was funded in 1999 by a one -time legislative appropriation from which 11 grants totaling $4.2 million were awarded to 8 communities. The account is currently unfunded. Lino Lakes has benefited from the following LCA grants: 1997 $220,000 Livable Communities Demonstration Account grant for the master plan of the Village area, including a market analysis and the design guidelines that were adopted with the approval of the Legacy at Woods Edge. 2000 $450,000 Livable Communities Demonstration Account grant for land write down and infrastructure improvements to support mixed income housing components in Legacy at Woods Edge 2004 $225,000 Local Housing Incentives Grant to fill financing gap for Lakewood Apartments in Legacy at Woods Edge 2004 $750,000 Livable Communities Demonstration Account grant for $750,000 for land write down and infrastructure improvements for Legacy at Woods Edge total $1,645,000 • • Goals The previous LCA goals included six categories expressed in percentages of the total of new dwelling units in the city over the goal period. The Met Council notified us of the proposed new goals. The new goals include two categories, expressed as a range of the number of units. There is a goal for affordable housing, and a goal for lifecycle housing. Definitions: The term "affordable housing" often is misunderstood. For 2010, affordable means a purchase price ceiling or target maximum price for a new owner- occupied home based upon what a family of four with an income at or below 80% of area median income (AMI) can afford at prevailing interest rates. At the 80% threshold, an affordable house in 2010 would cost no more than $233,100. These percentage threshold are adjusted over time and the price thresholds changed accordingly. In fact, beginning in year 2011, the affordability standard for owner - occupied units will be 60% of AMI. In 2010, this would translate to a house price of $179,100, though this price level may change next year depending on market forces. For affordable rental units, the Met Council uses the maximum monthly rents permitted in the Minneapolis -St. Paul metropolitan statistical area for the federal low- income housing tax credits to rental housing serving households at 50% of AMI. This translates to affordable monthly rents ranging from $735 for an efficiency unit to $1,218 for a four - bedroom unit. "Lifecycle housing" means varied housing options that meet people's preferences and circumstances at all of life's stages, providing a balance of single - family homes, apartments, condominiums, townhomes, and senior housing for independent living or with a range of assisted - living services. Affordability Goal: As discussed previously and as described in the draft new comprehensive plan, the affordable housing need in Lino Lakes established by the Met Council is 560 units over the next 10 years. The Met Council states that it acknowledges the .reality of limited funding and asks Lino Lakes to establish a new housing goal as a range of 364 to 560 units. The low end of the range represents the number of units that can be accomplished at currently available funding levels region wide. Lifecycle Goal: For the purpose of this goal, lifecycle means units other than single family detached. The Met Council asks Lino Lakes to establish a new lifecycle housing goal as a range of 560 to 1,860 units for the next ten -year period. The low end is the affordable housing need. The high end is the potential number of units permitted by the land use guiding for the high and mixed land use categories in the draft new comprehensive plan. Comparing Old and New Goals: Table 1 lists the proposed new LCA goals and compares them to the previous goals. For 2011 -2020, there are two categories, and the goals are expressed as a range for the number of units. The new goals and old goals are not directly comparable for two reasons. First, the new goals are for a 10 -year period and the old goals covered 15- years. Second, the old goals were expressed as percentages of new dwelling units rather than a number of units. To provide a comparison, city staff prepared two tables. Table 1 shows the unit calculations and the annual averages for each goal period. (The unit calculations for the old goals are explained in Table 2.) We can see that the annual average for the new lifecycle goal range would include the old goal. We also can see that the annual average range for the new affordability goal is significantly lower than the old goal. • • Table 1: New LCA Goals 2011 -2020, Compared to Previous Goals Table 2 lists the previous goals (1996 -2010) and short explanations of what each goal means. Note that the unit count in the last column was not part of the goals: the goals were expressed in percentages. Table 2: Old LCA Goals: 1996 -2010 Goals explanation Met Cncl. calculations using 1996 and 2006 forecasts of 3000 new housin units Type (non - single family detached) 35% of all new housing will be attached units 1052 Owner/Renter Mix 85/15% 85% of all new housing will be owner - occupied, 15% of all new housing will be rental 2554 451 Ownership 65% of new owner units will meet affordability test 1660 Rental 25% of new rental units will meet affordabili test 113 if Single Family Detached 2.3 /acre SF detached units to be 2.3 units /acre Multiple Family 10 -12 /acre attached units to be 10 -12 units /acre OLD GOALS 1996 -2010 goals as unit numbers (15 years) NEW GOALS 2011— 2020 goals unit range (10 years) Lifecycle (attached units) 1052 560 to 1,860 annual average 70 56 to 186 Affordability 1660 + 113 =1773 364 to 560 annual average 118 36 to 56 Table 2 lists the previous goals (1996 -2010) and short explanations of what each goal means. Note that the unit count in the last column was not part of the goals: the goals were expressed in percentages. Table 2: Old LCA Goals: 1996 -2010 Goals explanation Met Cncl. calculations using 1996 and 2006 forecasts of 3000 new housin units Type (non - single family detached) 35% of all new housing will be attached units 1052 Owner/Renter Mix 85/15% 85% of all new housing will be owner - occupied, 15% of all new housing will be rental 2554 451 Ownership 65% of new owner units will meet affordability test 1660 Rental 25% of new rental units will meet affordabili test 113 if Single Family Detached 2.3 /acre SF detached units to be 2.3 units /acre Multiple Family 10 -12 /acre attached units to be 10 -12 units /acre OPTIONS • 1. Approve Resolution No. 10 -73 approving continued participation in the Livable Communities Act programs. 2. Deny Resolution No. 10 -73. 3. Return to staff with direction. RECOMMENDATION Option 1 • •