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10. Housing Goals Update.MEMORANDUM CITY OF CHANHASSEN 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 (612) 937 -1900 • FAX (612) 937 -5739 TO: Don Ashworth, City Manager FROM: Kate Aanenson, AICP, Planning Director DATE: November 21, 1996 SUBJ: Housing Goals The purpose of this memo is to bring you up to date on what action has been taken by the city to meet the goals of the City in its agreement to participate in the Livable Communities Act. Affordability of housing is one of the goals, along with density and diversity of types of homes as well as owner and rental. Following is an outline of the goals that were agreed to, recent projects that meet these goals, and future strategies to help meet the goals. HOUSING GOALS HOUSING GOALS AGREEMENT METROPOLITAN LIVABLE COMMUNITIES ACT PRINCIPLES The City of Chanhassen supports: 1. A balanced housing supply, with housing available for people of all income levels. 2. The accommodation of all racial and ethnic groups in the purchase, sale, rental and location of housing within the community. 3. A variety of housing types for people in all stages of the life - cycle. Housing Goals Update November 21, 1996 ' Page 2 4. A community of well maintained housing and neighborhoods, including ownership and I rental housing. 5. Housing development that respects the natural environment of the community while ' striving to accommodate the need for a variety of housing types and costs. 6. The availability of a full range of services and facilities for its residents, and the ' improvement of access to an linkage between housing and employment. GOALS 1 To carry out the above housing principles, the City of Chanhassen agrees to use the benchmark indicators for communities of similar location and stage of development as affordable and life - cycle housing goals for the period of 1996 to 2010, and to make its best efforts, given market conditions and source availability, to remain within or make progress toward these benchmarks. * The City of Chanhassen reserves the right to renegotiate the goals after 2 years. ** Chanhassen agrees that the Metropolitan Council will use other market indicators to evaluate goals. These indicators may include land prices, interest rates, cost of construction, and environmental factors including trees and wetlands. To achieve the above goals, the City of Chanhassen elects to participate in the Metropolitan Livable Communities Act Local Housing Incentives Program, and will prepare and submit a plan to the Metropolitan Council by June 30, 1996, indicating the actions it will take to carry out the above goals. i I iJ City Index Benchmark Goal Affordabili Ownership 37% 60 -69% 50% Rental 44% 35 -37 % 35% Life-Cycle Type (Non - single family detached) 19 % 35 -37% 34% 1991 Comp Plan Owner/Renter Mix 85/15% 67- 75/25 -33% 80/20 Densi Single-Family Detached 1.5 /acre 1.8 -1.9 /acre 1.8 Multifamily 11 /acre 10 -14 /acre 9 -10 To achieve the above goals, the City of Chanhassen elects to participate in the Metropolitan Livable Communities Act Local Housing Incentives Program, and will prepare and submit a plan to the Metropolitan Council by June 30, 1996, indicating the actions it will take to carry out the above goals. i I iJ J Housing Goals Update November 21, 1996 Page 3 PROJECTS THAT MEET THE HOUSING GOALS Following is a list of some of the projects that have been recently approved in the city that will assist in meeting the housing goals. Projects built in 1995 -1996 Centennial Hills Senior housing project with 65 rental units. Of the 65 units, 39 are affordable rent meeting the housing goals. The City purchased the property and Carver County HRA developed the project. Approximately $300,000 is being held in escrow should a project shortfall occur and the city has guaranteed its general obligation should bond payments become at risk. I Mission Hills Private townhouse development of 208 units. Approximately 200 of the units are under $115,000. The units range in price from $73,000 - 115,000. Oak Pond Private townhouse development of 172 units. Approximately 100 of the units are under $115,000. The units range in price from $90,000- 115,000. Projects currently under construction -1996 I North Bay Single family detached zero lot line subdivision (3000 square foot lot size). The city is providing a subsidy of approximately $700,000 through the HRA and the creation of a housing district. Of the 76 units, 18 will be for first time home buyers and 17 will be under $115,000. Prices of the 35 subsidized units range from $88,000 to $115,000. Projects which have received approval and will be under construction in 1997 Autumn Ridge Mixed unit development with 140 units including duplex, triplex, and fourplex units, and 6 and 8 unit buildings. Of the 140 units, the developer has stated that 80% will be under $115,000. Housing Goals Update November 21, 1996 Page 4 Villages on the Pond The Villages on the Ponds is a neo- traditional project. This is a mixed use project that has 322 units. One hundred fifty -four units are rental of which 35% will be affordable. There will be up to 168 owner occupied units, of which 50% will be affordable. HOUSING STRATEGY The City has agreed to the following strategy to meet the housing goals: CITY OF CHANHASSEN HOUSING ACTION PLAN LIVABLE COMMUNITIES ACT Background As part of the city of Chanhassen's agreement to participate in the Livable Communities Act, the City must submit to the Metropolitan Council the action plan the city will initiate to meet the established housing goals. In November of 1995, the City Council agreed to participate in the Livable Communities Act, and in December of 1995, adopted housing goals. Housing Element of the Comprehensive Plan In 1991, the Metropolitan Council approved an amendment to the City's Comprehensive Plan. A component of the Comprehensive Plan is the Housing Element. The Goals and Policies that were adopted in 1991 are still relevant to today's housing strategies. Goal To provide housing opportunities for all residents, consistent with the identified community development goal. Policies Existing housing within the city should be maintained and improved and revitalization of older developed areas should be encouraged. The City of Chanhassen will attempt to provide adequate land for projected housing growth and to provide opportunities for persons of a range of incomes. As appropriate state and federal funding permits, efforts should be made to provide low and moderate housing where needed, to provide balance to the generally higher cost of housing. New construction programs may provide a source of such housing. L 1 r 7 Housing Goals Update November 21, 1996 Page 5 Plans and ordinances for the City of Chanhassen should ensure that adequate amounts of land are designated to accommodated projected desired residential growth. The city should promote the use of state and federal programs designed to reduce land costs for developers of low and moderate income housing. The City of Chanhassen will cooperate with other governmental units and public agencies to streamline, simplify and coordinate the reviews required for residential development to avoid inflating the cost of housing due to unnecessary delays in the review process. Subsidized housing should be given equal site and planning considerations to non- subsidized housing units and should not be placed in interior locations or in areas that are not provided with necessary urban services. If demand becomes apparent, the city will promote the construction of senior citizen housing in locations convenient to shopping and medical services. The development of alternative types of housing such as patio homes, townhouses, and quadplexes should be permitted to supplement conventional single - family homes and apartments providing that they are compatible with appropriate land use practices and are representative of high quality development. New residential development should be discouraged from encroaching upon vital natural resources or physical features that perform essential protection functions in their natural state. Housing developments such as PUDs, cluster development and innovative site plans and building types should be encouraged to help conserve energy and resources used for housing. Property and code enforcement policies which encourage maintenance and rehabilitation of both owner occupied and rental housing should be encouraged. The city should continue to ensure non - discrimination in sale and rental of housing units. Citizen participation in developing plans and implementing housing programs is encouraged in redevelopment, rehabilitation, and in planning for future housing. On December 11, 1995, the City Council adopted the following Housing Goals: City Index Affordability Ownership 37% Benchmark Goal 60 -69% 50% Housing Goals Update November 21, 1996 ' Page 6 Rental 44% 35 -37% 35% I Life -Cycle Type (not S.F.) 19% 35 -37% 34% 1991 comp plan Owner /Renter Mix 85/15% 67- 75/25 -33% 80/20 I Density S.F. Detached 1.5 /acre 1.8 -1.9% 1.8 Multifamily 11 /acre 10 -14 acre 9 -10 , Current Trends In 1995, more non - single family residential permits were issued than detached single family ' permits. Of the residential land area in the MUSA, a large portion is guided for medium or high density development. The city has worked with Carver County to provide a 65 unit Senior ' Housing project with 39 units in the rental affordable range. The City Council has approved the creation of a tax increment district to provide assistance to 35 of 76 single family detached units. Price ranges for 35 units will be from $88,00 to $115,000. Through growth and natural ' maturation, the city is experiencing housing diversity. Action Plan Proposal ' The city will continue to uphold the housing goals and policies of the comprehensive plan. In ' addition, the city will pursue other resources of providing life -cycle and affordable housing. Following is the proposed action plan. Currently, the city is also pursuing a clustering project with Southwest Metro, Eden Prairie and Chaska. This project would be a mixed use , development with a transit component (park and ride facility). The city is also working on a 60 acre mixed use project that also has a transit component with commercial, office, and institutional with residential integrated into the development. Both projects have a strong mass I transit component. City Ordinances I The following actions are possible actions the city should undertake to pursue life -cycle affordable housing: I • Promote Life cycle compatible with existing housing. • Review city ordinance regulations especially the PUD ordinance and lot size /zero lot ' and design standard including street widths. • Pursue the upper limits of zoning on new proposals where there is a density range. • Require a percentage of medium and high density to have a number of affordable , units. • Provide for mixed use projects with a transit component. 1 Housing Goals Update ' November 21, 1996 Page 7 City HRA ' The city, through the Housing and Redevelopment Authority, will explore all avenues for financing affordable housing, including tax - exempt and tax - increment financing. ' Carver County HRA L Development, Affordable Financing, Down Payment Assistance, Home Buyer Education ' and Foreclosure Prevention The HRA has the experience to develop affordable single family housing and is prepared to offer ' all cities in Carver County its expertise and assistance. ' The HRA offers first time home buyer funding through participating lenders in Carver County. The program is funded by mortgage revenue bonds from the HRA's bonding allocation. ' The HRA offers home buyer education and certification to all Carver County residents. The HRA offers foreclosure prevention counseling and financial assistance to all Carver County ' residents. Homeowner Rehabilitation ' The HRA currently administers the following programs in Carver County: ' MHFA Fix -Up Fund Maximum gross income $41,000, Maximum loan amount $15,000, 15 yr. Term, Interest rate 2 -8 %, Credit and repayment ability analyzed. MHFA Accessibility Improvement Loans Maximum income: no limit, Maximum loan amount $25,000, ' 20 yr. Term, Interest rate 8 %, Accessibility improvements only. MHFA Home Energy Loans ' Maximum income: no limit, Maximum loan amount $5,000, 5 yr. Term, Interest rate 8 %, Energy improvements only. ' MHFA Mobile Home Loans Maximum income: no limit, Maximum loan amount $5,000, 5 yr. Term, Interest rate 8 %, Energy improvements only. Housing Goals Update November 21, 1996 , Page 8 MHFA 3% Revolving Rehabilitation Loans ' Maximum income: $18,000 adj., Maximum loan amount $10,000, 15 yr. Term, Interest rate 3 %, repayment ability (not credit) analyzed. ' MHFA Deferred Loans Maximum income: $10,000 adj., Maximum loan amount $10,000, , Interest rate 0 %, Deferred 10 year loan. MHFA Deferred Accessibility Loans ' Maximum income: $18,000 adj., Maximum loan amount $10,000, Interest rate 0 %, Deferred 10 year loan, Accessibility improvements only. Carver County HRA Home Improvement Loans ' Maximum income: no limit, Maximum loan amount $5,000, ' Interest rate 3 -9 %, Term to commensurate with repayment ability. RENTAL HOUSING , I New Construction The Carver County HRA assisted in the formation of the Carver County Housing , Development Corporation, a non - profit entity with the ability to partner with private developers to create affordable housing projects and developments. ' Anticipated Action: feasibility ' The HRA, in conjunction with the City of Chanhassen, will explore the and funding opportunities available for housing development upon the city's request. ' II. Tenant Based Subsidy Section 8 Rent Assistance Program Metropolitan Council HRA I MHFA Rental Assistance for Family Stabilization (RAFS) Carver Count Transitional Housing ' Y g Carver County HRA Rental Inventory , Rental Rehabilitation Grants and Loans I Housing Goals Update ' November 21, 1996 Page 9 l u I I u CDBG Carver County is completing Housing Condition Study. The city will pursue using CDBG funds from Hennepin County to make housing rehabilitation loans. The city will pursue CDBG funding for acquisition and related infrastructure for multi - family projects. Minnesota Housing Finance Agency The city will pursue programs, including grants, loans and federal tax credits, for housing assistance development and rehabilitation including the following programs: • • • • • • Minnesota Mortgage Program Homeownership Assistance Fund Purchase Plus Program Partnership for Affordable Housing Entry Cost Homeownership Program (ECHO) Low Income Housing Tax Credit Program New Construction Tax Credit Mortgage/Builders Loans Low and Moderate Income Rental Program Deferred Loan Program Revolving Loan Program Great Minnesota Fix -up Fund Mortgage Revenue Bonds Mortgage Credit Certificates (MCC's) Action Responsibility Review City ordinances Explore all options for a variety of affordable housing opportunities Educate developers and ' residents about life -cycle housing City staff, Planning Commission and City Council City staff, Planning Commission and City Council City staff, Planning Commission, City Council and HRA Funding None CDBG, City HRA, Carver County HRA, Metropolitan Council, MN Housing Finance None Housing Goals Update November 21, 1996 ' Page 10 Cooperate with other Southwest Metro, Carver Carver County HRA, , governmental units in County HRA Metropolitan Council, MN providing housing Housing Finance opportunities ' Property and code City staff City HRA, Carver County enforcement or maintenance HRA, CDBG and rehabilitation of housing Look for opportunities for City staff, Planning City HRA, Carver County , mixed use developments with Commission and City Council HRA, Metropolitan Council, mass transit component MN Housing Finance NEXT STRATEGY Staff is working on the affordable housing strategy on several fronts. First we are working to , encourage development of the properties that are currently zoned for medium or high density to provide a variety of housing opportunities. Carver County is looking to develop another project in the city. Their other project, the Senior Housing, has all but one unit leased. There will be , other opportunities to provide sewer and water with additional phases of the Bluff Creek Interceptor, which should provide opportunities for a variety of housing types. There are a few , development projects that are taking shape which may require rezoning or comprehensive plan amendments. , Carver County is completing a housing condition study. This study will provide the city with data on housing that may be deteriorating. The purpose of this information is that the City has the ability to seek CDBG money for rehabilitation homes for the year 1997 -1998. Maintaining , the existing housing stock is another housing goal. Staff is also working on reviewing the Comprehensive Plan. There are two areas that we want to ' change. Right now an applicant has the ability to develop under the maximum density allowed. This issue was brought to light on the Townhomes at Creekside development. Staff was of the opinion that this area would be better utilized with the higher density. Unfortunately, the way the ' comprehensive plan currently reads, the city cannot deny a project based on it being built under the maximum density. Another ordinance amendment underway is to the PUD zone. Staff is working to provide opportunities for smaller lot development under certain criteria. Staff is also working on providing the numbers (density and units) to demonstrate where the city , stands on meeting the housing goals. We are planning on completing that at the first of the year. g: \plan \ka\housing.pc.doc I