City Council - Workshop Meetings

City Council Workshop Meeting Ash North and South Conference Rooms March 13, 2024 | 5:30 p.m. This City Council Workshop meeting is taking place virtually and at Woodbury City Hall in the Ash North and South Conference Room. Members of the public may attend the meeting in person and may also join the meeting using a computer, tablet or smartphone and accessing the virtual meeting link at woodburymn.gov/VirtualMeetings Watch the Live Meeting Public comments will be accepted during the meeting both in person and virtually. Virtual questions should be submitted via the online Q&A feature within the virtual meeting link. Questions regarding the meeting will be also taken between the hours of 8:00 a.m. to 4:30 p.m. at 651-714-3524 or at council@woodburymn.gov. Questions received after 4:30 p.m. will be responded to in the next three to seven business days. Please note that all agenda times are estimates. 5:00 p.m. Dinner – Birch Conference Room Workshop Agenda 5:30 p.m. 1. School Resource Officer Update 24-61 6:00 p.m. 2. Housing Action Plan Update 24-62 7:00 p.m. 3. Administrator Comments and Updates1 7:05 p.m. 4. Mayor and City Council Comments and Commission Liaison Updates1 7:15 p.m. 5. Adjournment 1 Items under comments and updates are intended to be informational or of brief inquiry. More substantial discussion of matters under comments and updates should be scheduled for a future agenda. The City of Woodbury is subject to Title II of the Americans with Disabilities Act which prohibits discrimination on the basis of disability by public entities. The City is committed to full implementation of the Act to our services, programs, and activities. Information regarding the provision of the Americans with Disabilities Act is available from the City Administrator's office at (651) 714-3523. Auxiliary aids for disabled persons are available upon request at least 72 hours in advance of an event. Please call the ADA Coordinator, Clinton P. Gridley, at (651) 714-3523 (TDD (651) 714-3568)) to make arrangements.  1 City of Woodbury, Minnesota Office of City Administrator Council Workshop Letter 24-61 March 13, 2024 To: The Honorable Mayor and Members of the City Council From: Clinton P. Gridley, City Administrator Subject: School Resource Officer Update Summary At the City Council workshop of February 14, 2024 direction was given to staff to continue evaluating legislative progress on the revised SRO legislation, to connect with District 833 on their engagement processes on this topic and get a sense of the school board’s position on continuing to have SRO’s in the school, and for Public Safety to evaluate the feasibility of staffing the SRO position(s) given our police officer staffing constraints. In terms of the SRO legislation, the SRO bill passed overwhelmingly in the House. It is expected to pass in the Senate and the Governor promised to sign the bill immediately. Our local government associations have indicated that the bill is an acceptable fix to last year’s legislation, and has had a thorough committee process. Second, in terms of any engagement processes by 833, Superintendent Nielsen responded that the district did not conduct any formal or informal engagement process with interested parties. Thirdly, regarding a sense of the school board’s position on the SRO program, Superintendent Nielsen indicated that “the School Board has always supported the SRO program and to my knowledge, that has not changed. As district leaders, we too have always supported and appreciated the role and work of SRO’s in our schools. Both SRO’s have positive relationships with staff and administration.” Recommendation Staff recommends that: 1. Authorize staff to continue the positive and collaborative conversation with District 833 leadership, and work towards a new and updated contract with District 833 that prioritizes the best interests of our community. 2. Postpone community engagement determinations until 2025, following implementation of the new state law, training requirements and a revised 833 agreement. 3. Delegate the staffing and programing priority of the SRO program to the Public Safety Director and City Administrator per the proposed contract language, in light of the dynamics of staffing availability, and how it compares to other Public Safety and City programing and priorities. Council Workshop Letter 24-61 March 13, 2024 Page 2 Fiscal Implications Per our current contract, the District pays 75% of the total compensation for the (2) officers during the school year. This equates to approx. $140,000 paid by the District for SRO services annually. In addition, the contract also allows for contracted security for after school activities, which accounts for an additional $11,000 paid by the District. Public Process September 27, 2023: City Council Meeting, School Resource Officer Services. February 14, 2024: City Council Workshop, School Resource Officer Services. Policy Not applicable. Governance Mode • Fiduciary - Stewardship of tangible assets, oversees operations and ensures efficient and appropriate use of resources, legal compliance and fiscal accountability. • Strategic - Setting priorities, reviewing and modifying strategic plans, and monitoring performance against plans. Focus is the “ends” rather than the "means”. • Generative - Identifying key questions, anticipating future challenges, framing of issues, development of options. Problem-framing. What to pay attention to, what it means, and what to do about it. How does it fit with our mission, vision and values? Contract and Staffing Considerations During our February 7, 2024, meeting with District 833, they provided us with a contract proposal. If we move forward with negotiations, we aim is to establish a contract aligned with the school year, deviating from the conventional calendar year approach, and subject to an annual evaluation. Additionally, we recognize the necessity for a service suspension and/or opt-out clause, allowing for removal of our SROs, at the discretion of the Public Safety Director, if our police officer staffing levels necessitate their removal to fulfill street patrol coverage requirements. This clause would detain the notice expectations of District 833, and will provide the Public Safety Director the flexibility to address emergency staffing situations mid-contract. Background On February 7, 2024, Public Safety leadership met with District 833 Superintendent Julie Nielsen and members of her senior leadership team. It was a positive and collaborative meeting. They advised that, based on informal discussions with school leadership, students, and parents, that there was much support for the existing program, specifically for the current SROs. The district expressed a desire to maintain the current program format, involving two Woodbury Police Officers—one assigned to Woodbury High School and the other to East Ridge High School. Council Workshop Letter 24-61 March 13, 2024 Page 3 The district conveyed that, for the time being, they were not inclined to reintroduce school specific SROs to middle schools, citing the effectiveness of the current SROs in assisting those schools when needed. Additionally, they acknowledged the necessity of a new contract, considering the existing contract dates back to 2008. During the meeting, the District presented a School Resource Officer Program Procedure document, crafted by Assistant Superintendent Kristine Schaefer, which formalizes guidance and expectations for collaboration between schools and SROs in fostering student success. Commander Ehrenberg, who oversees our SRO program and was a former SRO, affirmed that the document merely formalized practices developed in collaboration with the District over the program's decades-long existence. After the meeting, on February 23, 2024, City Administrator Clint Gridley contacted Superintendent Julie Neilsen, seeking data related to the engagement efforts discussed on February 7. He also inquired about the School Board's stance on the SRO program. Superintendent Neilsen responded, advising that the District did not have engagement-related data or documentation due to the absence of a formal engagement process. However, she affirmed the School Board's consistent support for the SRO program, emphasizing the consistent District Leadership support and appreciation for the role and work of SROs in our schools. Woodbury SRO Feedback The feedback from our former and current SROs underscores the meaningful connections they have forged within the school community. They share instances where their proactive involvement with staff and students averted the need for emergency 911 calls and spoke about the relationships they've cultivated which have empowered students to confide in them about sensitive issues such as sexual assaults, problems at home, and giving them early warnings about problems that impact school safety. Being physically present in the schools has allowed them to respond swiftly to incidents within the school, the visibility of the squad stationed at the entrance serves as a deterrent for potential harm-doers, and they know that with their specialized training and equipment that they’re well- prepared to address any threats posed by individuals seeking to cause harm at the school. They also receive additional training related to working with youth, which allows them to be more effective when addressing issues with students and staff. Most importantly, our SROs value the consistent positive interactions and relationships they have with students. Recognizing that, for many students, these interactions might be their only (positive) touchpoint with Law Enforcement. Our SROs appreciate the opportunity to contribute positively to the school environment. SRO Data Woodbury Public Safety has operated an SRO program for so long that we don’t have any data related to our calls for service (at the schools) before the implementation of the program. Seeking insight into the experiences of other law enforcement agencies, we engaged with Brooklyn Park PD, Plymouth PD, Anoka County Sheriff's Office, and Brooklyn Center PD – all of Council Workshop Letter 24-61 March 13, 2024 Page 4 whom previously maintained SRO programs but recently removed their SROs and transitioned to a call and respond model. Brooklyn Park PD, with their SROs in place, had an average of 32 monthly calls for service at their schools. Following the removal of SROs, this number increased to 39 calls per month. Similarly, Plymouth PD reported 406 calls for service with SROs, compared to 439 calls without them over the same time duration. The overseeing sergeant at Plymouth PD emphasized that it’s actually a much more significant spread, noting that without the SROs in the schools, the staff began handling more of the harassment and assault-type calls that had previously been addressed by an SRO. Brooklyn Center PD advised that they have not been actively tracking the before and after effects and Anoka County has yet to respond to our data request. Other School Systems We connected with Stillwater School District 834 leadership. They advised us that their elementary school in the city has a good relationship with Woodbury Public Safety, and they appreciated the visits from the K-9 unit and when officers come in to read to the students. They were not interested in pursuing a more established program at this time. We also reached out to the St. Paul School District for conversations about their E-STEM Middle School in Woodbury. The St. Paul School Board voted to remove their SROs in June 2020 and continue to operate without an SRO program. However, the E-STEM Middle School has their own school support liaisons to address security and relational aspects in the school. While they are not interested in pursuing a formal program with Woodbury Public Safety, they shared that they have an outstanding relationship with our staff from previous interactions. Woodbury Public Safety does provide general engagement to our private schools in the city along with some additional school specific engagements throughout the year. To this point, none of our private schools have expressed interest in a formal SRO program. Written By: Jason Posel, Public Safety Director / Chief Approved By: Clinton P. Gridley, City Administrator Attachments: Minnesota House of Representatives update, “Enhanced School Resource Officer legislation passes off the House floor.”  2 City of Woodbury, Minnesota Office of the City Administrator Council Workshop Letter 24-62 March 13, 2024 To: The Honorable Mayor and Members of the City Council From: Clinton P. Gridley, City Administrator Subject: Housing Action Plan Update Summary The City’s Housing Action Plan provides short-and long-term policy guidance regarding strategies to assure the creation, access, and preservation of affordable housing, revitalization of existing housing and preservation of neighborhoods. The Housing Action Plan was last updated in 2021. In May of 2023, Governor Tim Walz signed HF2335, also known as the Housing Finance and Policy Bill, into law. The housing package appropriates over $1 billion in annual funding to new and existing programs to develop and expand the supply of affordable housing. As a result, Woodbury is projected to receive approximately $600,000 of Local Affordable Housing Aid (LAHA) revenue in 2024, which is expected to grow to over $900,000 in subsequent years. The 2021 Housing Action Plan should be reviewed given this new and recurring revenue source, and its obligations.. Policy questions will focus on identifying and prioritizing uses of the LAHA revenue and consideration of other available revenues the City may want to leverage to increase the impact and scope of the City’s housing policies and programs. In addition to this council letter, a memorandum was sent to Council on March 1st, which provided additional information about the new local affordable housing aid funds, including qualified uses and the establishment of a local housing trust fund. Recommendation Staff is seeking Council direction regarding several policy questions: • Should the budget for HRA loan disbursements be increased for the 2025 HRA Budget? o If the loan disbursement budget is to be increased, should the HRA Levy be reinstated to support increased loan activity? • What are the housing policy priorities for the Local Affordable Housing Aid revenue? o Based on these priorities, what direction should staff pursue for next steps to be discussed at the June Council Workshop? Governance Mode Generative (identifying key questions, anticipating future challenges, framing of issues, development of options). Council Workshop Letter 24-62 March 13, 2024 Page 2 Fiscal Implications This workshop item will not have any specific fiscal implications but will lead to policy conversations regarding HRA fund balance (Fund 620), the HRA property tax levy, Local Affordable Housing Aid, and the role and nature of city investments in affordable housing. Policy 2021 Housing Action Plan 2040 Comprehensive Plan Public Process The 2021 Housing Action Plan was adopted by the City Council on April 14, 2021. This will be the first of three workshop sessions on this topic, with the second workshop scheduled for March 27th and the third for June 12th. Background In May of 2023, a new law established a seven-county metro area sales tax of .25 percent, to provide a permanent revenue source for housing programs into the future. Collection of the sales tax began October 1, 2023. Revenues from the sales tax have been earmarked for distribution to metro counties and cities as Local Affordable Housing Aid (LAHA). The City of Woodbury will be a recipient of the new LAHA revenue on a semi-annual basis, starting in July of 2024. This new recurring revenue source will provide direct financial assistance to help metropolitan cities and counties to develop and preserve affordable housing within their jurisdictions. Woodbury’s Commitment to Affordable Housing Woodbury’s current policies related to housing are guided by the 2040 Comprehensive Plan and the 2021 Housing Action Plan. These two documents establish the City’s housing priorities and the strategies and tactics to be implemented to achieve policy goals. They also affirm Woodbury’s commitment to providing diverse housing options which allow people in all life stages and of all economic means access to safe, stable, and affordable homes. Moreover, Woodbury has been a leader among metro area cities in creating new affordable housing units. According to data aggregated by the Metropolitan Council, Woodbury ranked 6th out of 197 metro area cities in creating new affordable housing units from 2018-2022. The attached Commitment to Affordable Housing infographic further details Woodbury’s leadership in this area. Housing Policy Continuum Housing policy is a continuum of policies and programs, which are created by different units of government from the federal level down to the local level and complement each other to meet the housing needs of a community. The housing policy continuum includes programs for creating new rental and owner-occupied units, preservation and rehabilitation of the current housing stock, direct assistance for renters and homebuyers, homelessness prevention, and other housing related services. Each unit of government fulfills a different role on the continuum which is dependent on their statutory authority and financial ability to appropriate revenues and create programming. Council Workshop Letter 24-62 March 13, 2024 Page 3 Woodbury’s housing policies operate within this continuum and are influenced by decisions at the federal, state and county levels. Federal – Revenues are appropriated, and programs established through action by the U.S. Congress. Funds are then allocated to state or local agencies for the creation of local programming or the implementation of federal programs. Examples include public housing, housing choice voucher rental assistance, Community Development Block Grant (CDBG), low-income housing tax credits, and HOME grants. State – Similar to the federal level, revenues are appropriated, and programs are established through action by the State Legislature. Funds are then allocated to local agencies for the creation or implementation of programming. Additionally, the state in some instances serves as a conduit for allocating funds to localities from the federal government. Examples include local affordable housing aid, low-income housing tax credits, and homeless prevention grants. County – In most instances the county is responsible for services to prevent homelessness or services for those experiencing homelessness and managing the Coordinated Entry System. Revenues to support these activities are allocated at the state and federal level. Counties are usually the recipient of funds to implement programming from the state and federal level to serve local needs but can also leverage local revenues to meet other housing needs of the community. Washington County CDA – The CDA serves as the County’s public housing agency. Public housing agencies have the authority to administer federal housing programs such as public housing and the housing choice voucher rental assistance programs. These programs are funded by federal dollars allocated to local agencies by the Department of Housing and Urban Development. City – Similar to counties, cities can be the recipient of state and federal funds to create and implement programming. Cities also can leverage local revenue options to implement housing programs such as an HRA property tax levy. Cities can play varying roles in implementing housing programming depending on their size and population. The City of Woodbury is a recipient of funds from both the federal and state levels of government to implement housing programs. The Housing Program Continuum Matrix attached to this Council Workshop Letter further details programming made available by different units of government and the population each program serves. The matrix illustrates how each level fills a need within the community and the current gaps in service at each income level. The text in black are programs currently in place, and the text in red are new programs created through the 2023 Housing Policy and Finance Law. Policy Question: Should the budget for HRA loan disbursements be increased for the 2025 Budget? Traditionally the HRA’s annual budget for loan disbursements ranges from $550,000 to $600,000, which supports approximately twenty loans. In years with high demand, when loans exceed the number budgeted for, the HRA fund balance has been drawn upon to issue more loans. This requires staff to request a mid-year budget adjustment to support high demand for the programs. In the past, potential homebuyers have missed out on assistance or a home due to funds not being available during the budget adjustment request process. Moreover, while a Council Workshop Letter 24-62 March 13, 2024 Page 4 healthy fund balance exists, continuing to draw upon the fund balance limits the HRA’s ability to grow the loan programs or pursue other housing action plan policies. Therefore, the policy question posed to Council is whether the 2025 and future HRA budgets for loan disbursements should be increased to fund a greater number of loans that is more representative of the demand for the program. Increasing the budget to align more closely with the demand would address the challenge of having to request mid-year budget adjustments. Additionally, the Council needs to decide if the revenue sources for the HRA loan programs will continue to rely solely on the HRA levy, supplemented by loan repayments, or if additional revenue sources should be used to support the issuance of loans. Reinstating the $250,000 HRA Levy may be a logical step to providing a reliable, recurring local revenue. Leveraging the levy with LAHA funds and loan principal repayments will provide additional ongoing support to the loan programs to meet the increased demand. Policy Question: What are the housing policy priorities for the Local Affordable Housing Aid revenue? The law which establishes LAHA, provides a list of qualified uses for the revenue, and staff are seeking direction from Council on the funding priorities for the City’s LAHA dollars. Staff have identified four housing policies for Council consideration. Prioritizing the policies will assist with establishing a foundation to begin assigning a share of the LAHA revenues based on the level of priority directed by Council. This exercise will also provide direction to staff and assist with developing the discussion on next steps for the June Council workshop. The four policy areas listed below are described briefly in this City Council Workshop Letter and will be discussed further during the upcoming March Workshop. Housing Policies: 1. Preserving subsidized affordable housing; 2. Increasing the impact of HRA loan programs; 3. Land banking parcels of land for future affordable housing development; and 4. Establishing a local housing trust fund 1. Preserving subsidized affordable housing Since the creation of the low-income housing tax credit (LIHTC) program in 1986, over three million units of affordable housing have been created. However, many of the units subsidized by LIHTC are beginning to reach the end of their periods of affordability. For many of these properties, operating costs have outpaced the allowable rents under the program, and the properties have aged and need major capital improvements. The revenue imbalance experienced by properties towards the end of their affordability period increases the risk of the units converting to market rate. The challenge of losing affordable housing units is becoming increasingly more common as large numbers of LIHTC units constructed in the 90’s and early 2000’s are reaching the end of their affordability period. In Woodbury, there are currently eight (8) affordable developments subsidized through LIHTC, totaling 691 units. Of the eight (8) developments, three (3) will reach the end of their affordability period over the next decade. In addition to these three (3) LIHTC properties, there is also a housing TIF development approaching the end of its affordability period. In total, there are 120 affordable units at risk of converting to market rate this decade in Woodbury. Council Workshop Letter 24-62 March 13, 2024 Page 5 LIHTC and TIF Subsidized Properties in Woodbury Service Service Property Address Subsidy Units Start End Ashwood Ponds 6725 Ashwood Road LIHTC 36 1996 2026 Stonecrest Senior 8725 Promenade Lane TIF 17 2001 2026 Living Lakeside 401 Lakeview Alcove LIHTC 32 2001 2031 Townhomes Pondview 431 Woodduck Place LIHTC 35 2004 2034 Townhomes Sienna Ridge 11086 Cresthaven Trail LIHTC 41 2008 2038 Townhomes Views at City 375 Lake View Drive LIHTC 45 2013 2043 Walk Glen at Valley 7995 Afton Road LIHTC 42 2019 2049 Creek Legends of 570 Settlers Ridge Pkwy LIHTC 216 2019 2049 Woodbury Orville Commons 4290 Radio Drive LIHTC/HOME 235 2023 2053 In response to this impending challenge, many communities have developed their own financial incentives to preserve affordable units. These incentives include deferred no interest loans and grants for capital projects and debt buy-down to reduce operating costs. In exchange for the low- cost capital, a new affordability declaration is placed on the property which again restricts rents and tenant income for periods ranging from ten to twenty years. The WCCDA has already prioritized LAHA dollars towards addressing the expiring affordability issue. It could be beneficial for the City to also prioritize its LAHA dollars as a measure to ensure WCCDA spending occurs within Woodbury. Partnering with the WCCDA to leverage the funds of both agencies for preservation incentives could increase the impact of LAHA dollars and the likelihood of success in this area. 2. Increasing impact of HRA loan programs The HRA’s First-Time Homeownership and Neighborhood Reinvestment loans are the City’s bread and butter housing programs. To date, the HRA has loaned an aggregate amount of $7,886,628 and assisted over 321 households. Historically, the programs see increased demand during periods of high interest rates and rapidly increasing home prices. In 2023 the HRA issued 26 loans, the highest number since 2016. Staff anticipates a continued high level of demand for the HRA programs in 2024 and 2025 due to continued elevated interest rates and home prices. The HRA’s First Generation Homeownership program is one of three similar loan programs available to buyers in Woodbury. However, the other programs tend to serve lower income populations, have geographic restrictions, or do not offer the same level of assistance as the Woodbury program. Additionally, the other first generation homeownership programs created by the 2023 housing legislation are pilot programs and are funded for only three years. The attached First Generation Loan Program Comparison infographic illustrates similarities and differences between the homeownership programs and the Woodbury HRA’s value in this area. Council Workshop Letter 24-62 March 13, 2024 Page 6 Downpayment assistance programs are a qualified use for LAHA revenues. Revenues received by the City can be used to fund the HRA loan programs or be leveraged with other local revenues to either support the current level or increase the level of service. 3. Land Banking Land banking is a current policy of the adopted 2021 Housing Action Plan. The City has not been able to realistically pursue land banking due to the high cost of acquiring land and holding it for long periods of time. Historically, the HRA fund balance has been the only revenue source available for this activity, and purchasing enough land to make a meaningful impact would greatly deplete the fund balance. LAHA revenue presents an opportunity to accumulate funds over time to better respond to opportunities that arise to acquire land and leverage other HRA funds if needed. The WCCDA has already prioritized this activity for the use of their LAHA disbursement, and there is the possibility for partnership to leverage the funds of both agencies for land acquisition in the city as well. 4. Establishing a Local Housing Trust Fund As detailed in the Council Memorandum dated March 1st, cities have the option of setting up a local housing trust fund (LHTF), to build up funds over time and use them as opportunities present themselves. Creating a LHTF provides a dedicated and flexible source of funding to meet the housing needs of a community. Additionally, LAHA funds used to capitalize a LHTF will be considered expended, and the three-year timely spending deadline no longer applies to the funds. This will allow the City to build up LAHA revenues over time and utilize them for policies that require higher levels of investment. Upon the creation of the LHTF, the housing policy priorities as directed by Council, will be applied to the funds held in trust and guide the investment of the funds. This will be done through the declaration of trust, which must state the purpose and objectives of the trust, define the beneficiaries, and define allowable investments for disbursements. Other communities have found the LHTF to be a valuable tool to assist with clearly defining the needs of their communities, establishing well-structured programs and processes, and providing accountability for the use of funds. Next Steps The direction and feedback received from Council at the two March workshops will be used to develop the discussion for the June 12th workshop. The June discussion will focus on recommendations from staff on possible actions the City can pursue to implement the housing policy priorities determined during the March workshop. Staff will also seek final direction from Council on budgetary items such as the 2025 HRA loan disbursement budget, re-establishment of the HRA levy, and the allocation of LAHA dollars. The final direction in June will be used to develop a 2025 work plan and budget for the HRA. Written By: Jamie Fritts, Housing and Economic Development Coordinator Approved Through: Janelle Schmitz, Community Development Director Attachment: 1. Woodbury Commitment to Affordable Housing Infographic 2. Housing Program Continuum Matrix 3. First Generation Loan Comparison Infographic  Commitment to Affordable Housing Affordable New Construction Woodbury has long been committed to housing choice for decades through multiple comprehensive plans, choosing to maintain an approximate 50/50 split between single-family detached housing units and attached housing units. A core part of the rationale behind the 50+ year commitment to a diverse housing stock is a recognition that single-family homes are not always affordable across all income brackets. The city ranks 6th out of 197 metro area cities in new construction Legends of Woodbury, one of the city’s of affordable multi-family units between 2018 and 2022. affordable senior living apartment complexes Metro Cities with Most New From Woodbury’s 2040 Comprehensive Plan: Affordable Housing Units “The City of Woodbury will encourage the development of a diversity New Units of housing to accommodate people of all ages, income levels and City 2018-22 family status. The city will identify areas for residential growth in a range of types, styles and affordability while maintaining high quality Minneapolis 7304 building standards and amenities.” St. Paul 3485 Minnetonka 906 Roseville 811 Affordable Housing Developments in Woodbury Bloomington 690 Woodbury 682 Views at City Walk West St. Paul 619 Ashwood New Brighton 490 Pointe Blaine 428 Lakeside Maple Grove 427 Pondview Townhomes Legends of Woodbury From metcouncil.org Sienna Ridge Woodbury housing funding sources: Glen at Valley Creek Stonecrest • HRA fund balance (Woodbury has a healthy Cobble balance of $1.7 million cash Hill and $3.1 million notes receivable.) • CDBG • HOME • Interest income • Loan repayment income • Property Tax Levy Orville Commons Pre-Application Developments Existing Developments Other cities are taking note of our programs: “In designing their programs, both Edina and St. Louis Park took inspiration from Woodbury, which rolled out its first-generation homebuyer initiative in late 2020.” -minnpost.com, January 2021 Housing & Redevelopment Authority (HRA) Loan Programs Affordable Housing Highlight: Our HRA loan programs continue to see high levels of demand this year despite the Orville Commons high interest rate environment in the housing market. The level of lending activity to meet the demand this year would not have been possible without City Council’s August 2023 resolution increasing the program budget from $550,000 to $806,192. Council agreed that resources should be allocated to meet the demand and that providing affordable homeownership options is a priority for the HRA. First-time Homeownership Down Payment Assistance • Created in 2009 to assist first time home buyers with the additional capital. The largest affordable housing • Average monthly housing cost burden for borrowers is 28%, which by Housing project in Washington County, and Urban Development standards is considered affordable. Orville Commons is also one of • Program has assisted 301 homebuyers, with the city lending an aggregate the largest in the Metro Area and amount of $7,289,747. one of only a handful of affordable properties with rents set at 50% AMI in the county. First-Generation Homeownership Race of First-Generation Woodbury was highly invested in • Created in 2021 to address the racial Homebuyer Loan Recipients in bringing this project to fruition, disparities in homeownership created Woodbury 2021-2023 including applying for tax exempt by the long history of discriminatory real bonds though three rounds of estate practices. MMB and providing gap • In addition to down payment assistance, 31% financing of $557,513 in HOME the program offers a 0% interest rate to 69% Grant dollars as a forgivable loan. qualified borrowers. • Program has issued 19 first-generation White Tenants began moving into the BIPOC loans total, just over 50% of all loans property in July 2023, including closed since 2021. 40 housing choice voucher participants. Density Bonuses Housing Action Plan Woodbury has been effectively facilitating development of affordable rental communities using density bonuses, as outlined within the comprehensive plan our Density Policy. The tool has most recently been used to facilitate development of the Legends of Woodbury and The Glen at Valley Creek. Density bonuses are a land use tool rather than a financial incentive; however, given that additional density within a project can lead to the ability for a project to create greater net operating income, density bonuses can in fact be just as valuable, if not more, than a financial subsidy. Gold Line Master Plan We are committed to facilitating development of affordable housing along the Gold Line transit corridor, which could increase ridership and assist households that may be transit dependent. The 2040 Comprehensive Plan is being amended to allow a density bonus of 10 additional dwelling units per net developable acre for properties guided as High Density Residential or Mixed Use and located within the Gold Line Master Plan area. These projects could then ultimately provide up to 25 dwelling units per net developable acre, upon the condition that at least 20% of the units serve households earning not more than 50% of the area median income. All other residential projects would be required to abide by the 2040 Comprehensive Plan’s guidance for density. Learn more at woodburymn.gov/Housing Woodbury Housing Program Continuum Matrix  First Generation Loan Program Comparison Max Loan Amount Minimum Contribution Loan Terms Geography Repayment Income Limit Purchase Price Limits Key Take Aways: 1. The state programs will be utilized in the city by buyers which presents the option to allow the Woodbury loan to be used in conjunction with these programs as a mechanism for further reducing monthly mortgage payments, eliminating mortgage insurance, and decreasing housing cost burden. 2. The state funded programs are three year pilot programs appropriated $150 million total and will sunset at the end of 2026 if no legislative action is taken to continue funding the programs. 3. The HRA may experience a decrease in demand for the First-Generation loan due to the new state funded programs, but the state programs may also run out out of funds prior to 2026 or not receive funding to continue after 2026. 4. Conversely, the HRA may also experience elevated demand for the First-Generation loan if the state and city loans can be used in conjunction with one another and more First-Generation buyers are drawn into the market due to the new assistance available.  First Time Home Buyer Loan Comparison Max Loan Amount Compatability Minimum Contribution Loan Terms Geography Repayment Income Limit Purchase Price Limits Key Take Aways: 1. Minnesota Housing will continue its standard down payment assistance programs which can be used stateside. 2. The Woodbury HRA loan terms for first-time home buyers will still continue to be more favorable than Minnesota Housing's loan programs. 3. Staff anticipates demand for the HRA first-time home buyer loan to remain high due to its favorable terms for home buyers not qualifying for the newly created first-generation programs. The HRA's loan program fills the service gap for moderate-income buyers with household incomes between 80% - 115% AMI and searching for starter homes.