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Having affordable housing critical

The Minnesota Legislature’s failure to pass a bonding bill will prove disastrous for Greater Minnesota. For two years, state lawmakers have promised to address the crippling shortage of affordable, workforce housing — but this year, those same lawmakers passed up an opportunity to fulfill that promise. While I am grateful for the support of Sen. Dan Sparks, his support has not been enough.

The lack of clean, decent and affordable housing is one of the most critical issues facing communities throughout our state. Without significant investment in bonds for housing, current shortages in rural job centers and small towns will increase dramatically. Lawmakers must take action now to ensure and promote the economic vitality of our communities.

Southwest Minnesota Housing Partnership cannot build new units or preserve existing units without state investments for these households. In June, SWMHP will apply to the state for bonds to preserve 483 units for low- and modest-income families. Without a bonding bill, these properties may exit the affordable portfolio and hundreds of households will be displaced. With vacancy rates below 1 percent in many areas, these families will have little hope of finding safe, decent and affordable housing.

Housing is considered affordable when it consumes less than 30 percent of a household’s income. According to a 2014 housing study, almost half of all renters in Albert Lea make less than $20,000, and 65 percent of these renters spend more than 30 percent of their income on rent. Because of the gap between what families earn and what rent costs, these households often have to make tough choices, forgoing critical medication, nutritious food and other necessities to afford a market rate apartment. These bonds would help me to preserve housing units that don’t require that sacrifice and are affordable for the average renter in our region.

It is impossible to create new or preserve existing housing for these households without Minnesota Housing Finance Agency funding resources. Without MHFA tools, SWMHP would need to charge renters over $1,000 just to pay the mortgage.

Without immediate action and significant investments aimed at preserving our housing portfolio, Greater Minnesota communities stand to lose much of their affordable rental housing stock. A record number of the state’s USDA rental housing loans are reaching the end of their required affordability period. Greater Minnesota risks losing roughly 600 units through 2018 and 350 tenants in these units will subsequently lose their rental assistance, and Minnesota will forever lose millions of dollars in federal rental assistance. Without a plan and resources, these properties will exit the affordable portfolio.

Decent, safe and affordable housing, like the housing I am trying to preserve, is the foundation for creating strong, stable communities. Our families and our communities need the Legislature to invest in bonds for housing. The governor and the Senate included $90 million for housing in their bonding proposals. In the event of a special session, the House needs to as well. Greater Minnesota needs an investment in housing now. We simply cannot wait two more years.


Rick Goodeman

executive director

Southwest Minnesota Housing Partnership