Memo WS on Housing :i ,
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To: Hopkins City Council
From: Jim Kerrigan and Kersten Elverum
Date: Friday, June 10, 1994
Subject: June 14, 1994 Work Session on Housing
Introduction
One of the agenda items for the June 14 City Council Workshop.Session is a general
discussion of housing within the City of Hopkins. The purpose of this discussion is as
follows:
o Provide an overview of housing programs and activities which the
City/HRA is presently involved�with or administering.
� o Review the Housing Analysis Report that was prepared in 1992 by
Community Development staff., �
' o Discuss new housing activities/programs that have been
undertaken within the last few years based on recommendations detailed
both in the Housing Analysis Repo�t and the Economic Development
Strategic Plan.
o Discussion of potential/future housing actions.
Backqround
The City of Hopkins has been involved with housing issues for a much longer time
period #han most other Twin City suburban communities. This is probably due to the
following:
o The older housing stock within the City.
o The desire to address the needs of the elderly population within
Hopkins.
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o The City Counci! has feit it was in the interest of the community to �
address housing issues.
In response to the above, in the early 1970's the City undertook the fo{lowing:
0 1971 - Established the first Tax fncrement District in the State of
Minnesota to facilitate construction of Vilfage Apartments, which is a HUD
subsidized elderly housing project.
0 1972 - Constructed 86 units of elderly/family pubiic housing.
0 1975 - Established a 1ow interest housing rehabilitation loan/grant
program. Hopkins was one of the first ofi four communities within the
State ofi Minnesota to establi�h such a program.
Recentiy it was determined that it was appropriate for the City to get more aggressive in
dealing with its housing needs/issues. As a result, a number of new housing
programs/activities have been undertaken within Hopkins.
Existinq Housinq Proqrams/Activities
The,following are housing programs/activities that are directly or indirectly related to
housing in which the City is involved:
o Housing rehabilitation loanlgrant program
o First Time Homebuyers low interest mortgage program
o Section 8 rental as'sistance program
o Landlord Coalition
o Neighborhood Advisory Board
o Family Resource Center
o Low income pub{ic housing program
o Hope Program
. o Home Remodeling Fair
o Transitional Housing Pro�ram (106 -11th Avenue South)
N
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� o Truth-in-Housing Program
o Code Compliance/Nuisance Abatement
o Residential Service District (Special legislation for Westbrooke
neighborhood)
o Fire Inspections of Multi-family Properties
o Housing Revenue Bonds
Attachments
In preparation for the June 14, 1994 work session the following materials are attached
for your review:
o Status of recommendations of the Housing Analysis and Strategic
Plan (relating to neighborhoods). Recommendations are also included
relating to ongoing or new housing initiatives for the City.
o Questions and Answers regarding the Residential Rehabilitation
Loan/Grant Program
� 0 1992 Ho kins Housin Anal sis
P 9 Y
o Memo regarding possible Zoning Ordinance Revisions
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1992
CITY OF HOPI�:INS � �
HOUSING ANALYSIS REPORT
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Prepared By:
City of Hopkins
Community Development Department
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1992
CITY OF HOPKINS
HOUSING ANALYSIS REPORT
P aae
I. INTRODUCTION 2 - 3
A. Background 2
B. Purpose Statement 2
C. Methodology 2
D. Executive Summary 3
II. ANALYSIS OF HOUSING STOCK 4- 8
A. Housing Inventory 4- 6
B. Demographics � - g
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III. HOUSING TRENDS 9- 11
A. Housing Behavior of the Different 9
Age Groups
B. Population Projections By Age Group 10
C. Population Projections' Effect on
Housing Markets 10 - 11
IV. HOUSING PROGRAMS 12 - 17
A. Housing Programs Administered by 12 - 13
City of Hopkins/HRA
B. Housing Programs Available in Hopkins 13 - 15
C. Other Housing Program Options 15 - 17
V. MAJOR HOUSING ISSUES lg
VI. RECOMMENDATIONS 1g _ 22
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I. INTRQDUCTION
BACKGROIIND �
In May of 1990, the Division of Planning and Economic
Development prepared the City of Hopkins Housing Analysis.
This report focused on the current housing issues in Hopkins
based on the available data at the time and made several
recommendations for future action.
Two years have passed since the preparation of this report
and a number of factors have changed. The City hired a
full-time Housing Coordinator, new housing programs have
been offered in Hopkins and the 1990 census data has begun
to be available.
In light of these changes and the constant need to re-
evaluate the current housing situation, the City Council and
the Community Development Department have set a goal of
establishing a strategic plan to maintain and up-grade
housing and neighborhood vitality. It is in response to
� this goal that the following report was prepared.
PtJRPOSE STATEMENT
The purpose of this report is to identify and evaluate the
major housing issues of the City of Hopkins and formalize a
strategy to ensure the long term viability of the City�s
housing stock and to provide for new housing opportunities
for current and future residents.
METHODOLOGY
The following resources were used to obtain the information
contained in this report:
0 1980/1990 Census Data
o Hennepin County Census Analysis Center
o City of Hopkins Assessment Dept. Records
o Lookina Ahead at Housinq - Metropolitan Council
o City of Hopkins Comprehensive Plan - BRW, 1989
� o City of Hopkins Housing Analysis - May 1990
page 2
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- EXECIITIVE SUMMARY
An analysis of the available 1990 census data and past
I � housing reports indicates that the following are the ma'or
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' housing issues for the City of Hopkins:
o Less demand for rental units and starter homes
�, o Hopkins housing stock is aging
o Decline of the Westbrooke Area
�I o Hopkins has a very high concentration of multi-family
, housing units
i o Image of the City has an affect on the real estate
market
o Affordability of housing is a growing problem
o Hopkins has several single-family homes which are
dilapidated and should be removed
The City currently offers an extensive variety of programs
to address many of these issues. Additionally, various
housing programs are available to Hopkins residents through
other public and non-profit agencies such as MHFA which
should be promoted by the City.
Many new housing initiatives are also discussed as part of
the report. However, many of these programs are not being
proposed to be undertaken because of staff and financial
limitations of the City. Staff is recommending that
' funding for such programs continue to be sought from outside
sources.
Based on the major housing issues and the current programs
available, staff has made 19 recommendations. Many of the
recommendations deal with continuing to offer the programs
the City has in place. Others, such as working towards the
development of a landlord coalition, identifying properties
for acquisition, sponsoring a home improvement show, and
investigating the possibility of selling the 20th Avenue
Townhomes to the residents are new activities.
All the recommendations contained in this report are aimed
at preserving Hopkins' housing stock and providing safe,
affordable housing for the City�s residents
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page 3
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il. ANALYSiS C�F HOUSING STQCK
!
HOIISING INVENTORY
TYPES OF DWELLINGS ADAILABLE
Single Family Homes 2,620 (30%)
Starter Homes <$90,000 1,518
Move Up Homes >$90,000 1,102
Duplexes and Triplexes 522 ( 6%)
Apartments 4,168 (47%)
Condominiums 1,017 (12%)
Townhouses 376 ( 40)
Mobile Homes 100 ( 1%)
total 8,803
Mobile Homes (1.OR)
Condominiums (12.0�)
Townhouses (4.0�) Single Family Homes (30.0�)
� Duplexes and Triplexes (6.0%)
Apartments (47.OR)
Observations•
* Hopkins has a much lower percentage of single-family
homes than the average for Hennepin County (30% in Hopkins
compared to and average of 55% in Hennepin County).
* Hopkins has a much higher percentage of multi-family
units than the rest of Hennepin County (69% in Hopkins
compared to 44% in Hennepin County.)
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MEDIAN VALIIE OF OWNER-OCCIIPIED UNITS FOR SELECT CITIES
i City 1990 1980 % Chanrxe
Minnetonka .................$121,000......$ 82,100 +47
New Hope ...................$ 92,500......$ 70,000 +32
St. Louis�Park .............$ 87,100......$ 61,600 +41
Hopkins ....................$ 86,700......$ 64,600 +34
Brooklyn Center............$ 79,400......$ 59,204 +34
Robbinsdale ................$ 76,500......$ 56,500 +35
Hennepin County............$ 91,000......$ 63,60Q +43
Observations•
•
* The median value of owner-occupied housing units in
Hopkins showed less than average increase in value when
compared to Hennepin County as a whole. However, the
percent of increase (34%) was consistent with other inner-
ring suburbs.
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VALIIE OF OWNER-OCCUPIED IINITS FOR SELECT CITIE3
CITY/# OF UNITS
Hopkins Robbinsdale St. Louis Pk Mtka
VALUE: (2,804) (4,386) (12,469) (14,319)
LESS THAN
$50,000 2% 2% 1% 0%
$50,000-
$99,999 690 86% 73% 29%
$100,000-
$149,999 15% 10% 18% 41%
$150,000-
$199,999 6% 1% 5% 15%
$200,000-
$299,999 5% 0% 2% 9%
MORE THAN
5300,000 2% 0% 1% 5%
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MEDIAN RENT FOR SELECT CITIE3
Minnetonka ....................$ 631
St. Louis Park ................$ 511
NewHope ......................$ 498
. Hopkins .......................$ 493
Brooklyn Center ...............$ 475
R obbinsdale ...................$ 471
Hennepin County ..............e$ 452
RENT COMPARISON F�R STIIDIO, ONE, TWO AND THREE BEDROOM UNITS
IN HOPRINS
� Average Rent Average Rent Percent
3/91 3/90 Chanae
1 Bedroom $ 466.00 $ 467.64 -0.35
2 Bedroom $ 559.66 $ 575.26 -2.71
3 Bedroom $ 816.43 $ 760.36 +7.37
Observations:
* Average rents in Hopkins are slightly higher than the
average for Hennepin County.
* Average rents for 1 and 2 bedroom units fell from
March 1990 to March 1991, while 3 bedroom units experienced
a significant increase in rents. This represents a lack of
3+ bedroom units throughout the Metro Area.
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DEMOGRAPHICS
POPULATION DISTRIBIITION BY AGE GROUP -
32%
30%d . 29%
28q, MedianageCityofHopkins 31.3 27y,
Median age Hennepin Counry: 327
26%
24
24%
22%' �
209d
18%
18%
167
14� 14 13%
1290 11%
10%
10q 9%' 8% .
89;
8%
69e 4%
4% 3% 3q,
2�
2%
09'
0— 5 6— 14 15 — 18 19 — 29 30 — 44 45 — 64 65 — 84 85+
Age Breakdown
� Hopkins � Hennepin County
Observations•
* Hopkins has fewer than average youths (age 0-18} than
the rest of Hennepin County.
* Hopkins has a significantly higher percentage of 19-
29 year olds (reflective of the rental market) and fewer
Adult 2's, Middle Agers and Empty Nesters than average.
* Hopkins has a higher percentage of both Young and
Older Seniors than average.
* Because the age categories in the 1980 census differ
from those used in the 1990 census exact comparisons can not
be made. However, in 1980 the City had a higher than average
percentage of 20-34 year olds and i.n 1990 the City continues
to have a greater percentage of roughly this age group.
This is reflective of the large number of rental units and
the transitional nature of this type of housing.
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� 1990
AGE/3E% PYRAMIDS
HOPKINS ' RTCHFIELD*
yp 90 qp 90 ;
b0 SO 80 80
70 1� '; 70 ��
60 60 ; 60 66
A Sa su , A so so
g � 40 � e ao ,o
e
30 30 30 70
MALES FEMALES MALES �EMAL
io zu io zo
io io to to
o a o °
1.5 1.0 0.5 0.0 OS l.0 1.S 1 5 1.0 0.5 0.0 O.S 1.0 ►.5
Percentage of Population Percentage of Population
• * Richfield was used as a comparison due to its similarity
to the County as a whole in terms of age distribution
HOIISEHOLD CHARACTERISTICS FOR SELECT CITIES �
Family Households Sinale Households
Hopkins 3,827 4,146
48% 52%
St. Louis Park 56% 44%
Robbinsdale 65% 35%
New Hope 66% 34%
Minnetonka 71% 29 °
Brooklyn Center 73% 27 �
Hennepin Co. 610 3 g�
Observations•
* Hopkins has the lowest percentage of family
households and the highest percentage of single person
households. This is a reflection of the high percentage of
• rental units.
page 8
ill. H4USING TRENDS
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HOIISING BEHAVIOR OF THE DIFFERENT AGE GROIIPS _
Youth (0 -19): This group is generally students
living with their parent(s).
Adult 1(20-2�4): Generally this group has left home
for either college or their first
, job. Housing is typically close to
� school or job site. Many will seek
I � housing together to reduce costs.
Adult 2(25-34): This group represents the typical
first time home buyer. They have
established themselves and are self-
supporting. If financially able,
they purchase a home. If not, they
may rent or live with parents.
Middle A e 35-49 : This rou has accumulated e uit in �
5� ) g P q Y
their homes and may move up to a
larger home or one with more
amenities.
Empty Nester (50-64): Generally this group has finished or
I ' will be finishing their child rearing
I responsibilities. They tend to
either stay in their current housing
or buy something more suitable to
I I their new lifestyle.
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Young Senior (65 74). Generally this group uses a variety
of housing options depending on their
health, finances and lifestyle.
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Older Senior 75+ . This rou will use a variet of
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housing options, but often needs
services along with the housing. '
source: Met Council, Lookinq Ahead At Housing, 1988 �"
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• POPIILATION PROJECTIONS BY AGE GROIIP - TWIN CITIES
METROPOLITAN AREA
Aqe Group 1990 2000 % Chanqe
Young Renter 172,000 148,000 -14.0
lst-time home buyer 425,000 333,000 -21.6
Move-up Buyer 491,000 601,000 +22.4
Empty Nester 269,000 365,000 +32.3
Young Senior 130,000 134,000 +0.03
Older Senior 101,000 122,000 +20.8
POPIILATION PROJECTIONS' EFFECTS ON HOIISING MARRETS
• 'e t'ons the effects on the
Based on the above stated pro� c i ,
various housing markets are believed to be as follows:
Rental Market
o The projected decrease in the renter age group will
result in a lower demand for rental housing and may
cause lower rents. Lower rents and/or higher vacancy
rates will result in lower cash flow for building
owners. Building maintenance may suffer as a result.
o Increases in the older population group (over 75
years old) as well as single-parent families with
lower incomes will create a demand for lower-cost
rental units and a greater demand for services.
First-time Home buyer Market
o The typical first-time homebuyers, the Adult 2's, are
expected to decrease by more than 92,000 between 1990
and the year 2000. This decrease could cause housing
prices to fall based on supply and demand.
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Move-up Market ,;;
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o Continued increases in the Middle Age group will
likely result in continued demand for move-up
housing. However, the significant decrease in the
pool of first-time homebuyers will likely cause
problems for those trying to sell their homes to move
up.
o Finding it difficult to sell, this group may find it
necessary to remodel and stay in their homes.
Young Seniors Market
o This group tends to use a variety of housing options
such as�existing single-family homes, condominiums
and rental. Between 1990 and 2000, this group will
only grow by three percent.
Older Seniors Market
o The older seniors, over 75 years old, will'grow
significantly between 1990 and 2000, increasing by
more than 21,000. This group, whether it stays in a
single-family home or moves to a housing unit for
elderly people, typically demands services, such as
personal care, home maintenance and transportation.
o A significant percentage of this population has very
low incomes.
page 11
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IV. HOUSING PROGRAMS
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HOUSING PROGRAMS ADMIN38TERED BY THE CITY OF HOPRINS/HRA
Residential Rehabilitation Loan/Grant Proqram
o Loans and grants for the correction of code
violations, handicap accessibility and weatherization
improvements.
o Loans are at 3% interest over a 12 year period;
income limits of $38,600 for household of four.
o Grants are forgiven after 6 years; income limit of
$25,500 for household of four
o Homeowners must have equity equal to loan/grant
o Funded with CDBG and revolving loan funds
o Currently staff is administering 13 rehabilitation
projects under this program
First-time Home Buyer Loan Proqram
o Low interest (7.15%) mortgage loan program for
individuals or families with an adjusted yearly
� income of $40,800 or less
o Must be a first-time home buyer
o Maximum purchase price of $85,000
o Funded through proceeds from the sale of tax exempt
bonds; offered through Minnesota Housing Finance
Agency.
o First offered June 1991
Hopkins HRA Subsidized Public Housinq Proqram
0 76 Elderly/Handicapped housing units at Dow Towers
0 10 Townhomes located at 20th Ave. South "
o Rent based on ability to pay
Section 8 Rental Assistance Program
o Certificates and Vouchers for rental assistance;
currently over 105 in Hopkins
o Administered through Metro HRA by the City
0 20% increase in program over last year
S�ecial Needs Housina Program
o Grant through MHFA to rehabilitate property at 106
llth Avenue South for transitional housing
� o Meets current housing need while allowing for future
redevelopment of site
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Truth In Housinc� �`
o New ordinance effective 8/1/92; requires disclosure
of code violations prior to sale
o Properties inspected by outside evaluators '
o Certain hazardous items must be corrected before new
owner can occupy property
Rental Property Ins�ection Proqram
o Rental properties must be registered with City yearly
o Multi-family units are inspected yearly to assure
compliance with Housing Code
Housing Revenue Bond
o City sells bonds on behalf of developer
o Percentage of project need to be available to low
income households
o Only eligible for large multi-family housing projects
o Allows lower interest rate for new construction
o Examples of projects include:
St. Therese - $15 million
Chapel View - $5 million
Ho�kins Community Imaqe Awards ��
o Recognizes property owners who have made a
significant improvement to their property or who
continue to maintain their property in an exceptional
manner.
HOU3ING PROGRAM3 ADAILABLE IN HOPRIN3
MHFA Home Enerqy Loan Proqram
o Loans to homeowners to complete energy saving
improvements ,
o Interest rate of 8.875%; no income guidelines
o Maximum loan of $5,000 for 60 months
MHFA Fix-Up Fund
o Loans to make general improvements
o Interest rate varies with income
o Maximum Income of $38,000/year
o Maximum Loan of $15,000 for 15 years
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• MHFA Deferred Loan
o Basic and necessary repairs eligible
o Maximum income of $8,500
0 0% interest deferred loan; forgiven after 10 years
o Maximum loan of $9,000 '
MHFA Revolvinq Loan Proqram
o Basic and necessary repairs eligible
o Maximum income of $15,000
0 3% interest installment loan
o Maximum loan of $9,000 for 15 years
MHFA Accessibility Loan Proqram
o Funds used for accessibility improvements only
o Maximum income of $15,000
0 0% interest deferred loan; forgiven after 5 years
o Maximum loan of $10,000
MHFA Low Income Housing Tas Credit Program
o Reduces federal income tax liability of qualifying
rental property owners for up to ten years
• o Owners must agree to rent to low and moderate income
tenants
MHFA Rental Rehab Loan Proqram
o Installment loan for rehab of rental property
o Maximum loan of $8,000/unit; $40,000/bldg
0 7.45% interest for a maximum of 15 years
o Most tenants must be low and moderate income
MHFA A�artment Renovation Mortgaqe Program
o Interest rate write-down on lst mortgage
o mortgage funds for purchase or refinancing of
existing five+ unit rental buildings
� o Rent limits based on Section 8 limits; 75% of tenants
must be low income
0 9.75% interest rate over 30 year term
o Minimum loan of $100,000; maximum of $2,000,000
MHFA A�artment Renovation Incentive Loan Proqram
0 0% interest; 30 year deferred subordinated loan
o Matching loan on 3 to 1 basis
o Rent limits based on Section 8 limits
• o Maximum of $2,500 per unit
page 14
o Must have $1,000 of rehab funds and $500 in owner �
equity per unit to be eligible
Cammunity Enerqy services Proqram
o Sponsored by NSP and Minnegasco '
o Provides free energy check ups, workshops, energy
saving materials and low interest loans
Metro Paint-A-Thon
o Sponsored by the Greater Minneapolis Council of
Churches
o serves low-income seniors and disabled homeowners by
painting their home
Department of Enerqy Weatherization Proqram/Enerqy
Assistance Program
o Available through West Hennepin Human Services
o Assistance to renters and homeowners to make energy
improvements to their dwellings/assistance in making
utility payments
There are a variety of other housing assistance services
available through such organizations as Vail Place, �
Sojourner Shelter, etc... for individuals with special �
needs.
OT$ER HOUSING PROGRAM OPTIONS
Scattered Site AcquisitionjDemolition Program
o Blighted property is purchased, the structure
demolished and site is redeveloped.
o example - Richfield's program
o cost varies greatly with project; fairly expensive
o must be voluntary sale, small or structurally unsound
structure on buildable lot, good neighborhood
� o not necessarily targeted to low income home buyers,
can be targeted to move-up market
Sale of HRA Townhomes to Residents
o Amenities needed to make them desirable (carpet,
; landscaping, etc...)
I o Emphasis of HOPE I Program; so funds may be available
i o Replacement of the subsidized units would be
� mandatory �
page 15
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• o HRA received grant from HUD to study feasibility of
project
Special IIse Housin4
o examples include transitional, homeless, handi�apped
housing, elderly housing, etc...
o Projects are typically proposed by service providers
senior Community Services - HOME Proqram
o General repair and maintenance program available
to elderly residents in participating cities
o CDBG eligible social service activity
o Anticipated to request funds for 1993 CDBG program
year
Home Maintenance Workshops/Home Remodelinq Shows
o Encourage homeowners to upgrade their homes
o Work with Inspection Department or School District
Tool Librarv
o Lend tools to residents to make home improvements
• o Could possibly work with Rental Centers
Rehab/Purahase Financing for Mid-income Homeowners/Buyers
o Taxable Revenue Bonds for source of funds .
Home Buyer's Seminars -
o In conjunction with local lender(s)
o Focus on saving, credit analysis, borrower
evaluation, types of mortgages, how to select a home,
making repairs, City services, etc...
Rehab Loan Proqram Combined With Private Financinct
o Homeowner borrows what they can afford from local
lender; remainder is financed through City loan or
grant
o May be difficult to qualify homeowners under lenders
guidelines and City's income requirements
Landlord CoalitionjManaqement Workshops
o Emphasis on good management practices, tenant
screening, maintenance, etc...
� o Recommendation of Springsted study
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page 16
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HOME Investment Partnership ProQram
o Hennepin County will receive entitlement funds
through HOME Program to be awarded on a competitive
basis to eligible cities and non-profits
o Priority activities for the funds are as follows:
+ moderate rehabilitation for very low-income
homeowners
+ rehabilitation/acquisition for homeless families
and individuals
+ rehabilitation/acquisition for persons with
special needs
+ new construction or rehabilitation for very
low-income small or large families
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page 17
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•
V. MAJ{�R H�USINC 1SSUES
Based on analysis of the 1990 census, past housing studies
and reports, and the City of Hopkins Comprehensive Pl.an the
followinq have been identified as the major housing issues
facing Hopkins:
Less demand for rental units and starter homes. Hopkins
housing stock is largely comprised of multifamily and entry
level housing. These types o� housing units are usually
occupied by young adults, 19-29 years of age. This group is
expected to decrease substantially during the 1990�s.
Hopkins housinq stock is actina. Currently, over 50% of the
housing stock is 20 years old or older, more than 30% is
over 30 years old. These structures have an increased need
for maintenance and updating.
Deciine of Aestbrooke Area. The Westbrooke Patio Home and
Condominium neighborhoods are experiencing a substantial
need for rehabilitation and declining property values. This
neighborhood represents 16% of the City's housing stock.
• Hopkins has a very hiqh concentration of multi-familv
housin4 units. Approximately 60% of Hopkins housing units
are multi-family units, as compared to an average of 30%
throughout Hennepin County. This disproportionate amount of
rental housing leaves the City vulnerable in a weak rental
market. .
Imacxe of the City has an effect on the real estate market.
The overall image of the City by its residents and non-
residents is an important factor in maintaining the City's
property values.
Affordability of housinq is a crrowing problem. Findinq
affordable housing in the Metro Area is increasingly
difficult for low income renters and first-time homebuyers.
According to the Metropolitan Council, 30% of all renters in
the Metro Area pay more than 30% of their income towards
housing; 13% pay more than 50% of their income for housing.
Hopkins has several sincrle familv homes which are
dilapidated and should be removed. Scattered throughout the
City are several properties which are dilapidated and have a
blighting influence on the City. Those properties should be
removed and redeveloped when possible.
.
page 18
V1. RECC�MMENDATIONS
,,;
The following are staff's recommendations based on the
identified housing issues. While the majority of the
recommendations are to continue to offer current programs,
there are also some new initiatives being recommended. It
is important to realize, however, that while there are many
worthwhile programs that could be proposed, limited
personnel and financial resources put constraints on how
many programs can be offered.
Issue: Less demand for rental units and starter homes.
Effect: With less demand, rental units will have to be
either priced competitively or offer desirable
amenities. Since most rental units in Hopkins were
built in the 1970's, many lack newer features. As
a result, they will most likely have to be priced
competitively, which will allow less money for
maintenance and upgrading.
Decreased demand for starter homes will be
reflected in lower property values.
Recommended Actions: . �
Rental Properties:
Encouraqe the use of existing rental
rehabilitation proqrams available through MHFA.
Participate in joint mailings/advertising with MHFA
to promote programs.
Continue to investiqate possible sources of funds
for local rental rehab loan program. Educate
Hennepin County and MHFA of the need in Hopkins for
new or expanded rental rehab programs.
Determine interest for a landlord coalition or
landlord workshops. The Springsted study
recommended organizing a landlord coalition for the
Westbrooke area property managers. Other property
managers may also be interested in developing a
group which would meet to discuss topics of
interest.
Continue to inspect rental units and enforce the
�
'I housinq code. Consider the possibility of
� strenqthening the rental inspection program.
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• Sinqle-family Properties:
Continue to offer first-time home buyer loan funds
through MHFA.
Offer Home Buyer's seminars in conjunction with a
local lender.
Both recommendations help to keep the single-family
housing market strong by generating interest in
purchasing a home in Hopkins.
Issue: Hopkins housing stock is aging.
Effect: Without proper maintenance, the aging housing stock
will experience depreciated values and will have a
blighting influence on the City. Updated features
are also needed for the properties to be
competitive with newer housing.
Recommended Actions:
Continue to offer the Residential Rehabilitation
• Loan/Grant Program and promote this proqram
extensively.
Promote the use of other available rehabilitation
proqrams throuqh MHFA and other aqencies.
Evaluate Truth-In-Housinq Proqram after
one year.
Evaluate the benefit of adoptinq stranger housinq
maintenance codes.
Orqanize a home remodeling show which would
encourage homeowners to make improvements to their
property.
Issue: Decline of the Westbrooke Area.
Effect: Declining property values due to market conditions
and the need for rehabilitation have a variety of
effects on the City including a reduced tax base,
blighting effects on the City, and an increased
need for services due to inadequate screening of
tenants.
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Recommended Action: „u;
Implement the recommendations outlined in the
' springsted, Inc. study accordinq to the work plan.
Initiate discussions with FHA, MERF, and lenders
with a substantial interest in the area in order to
identify roles these organizations may play in the
revitalization of the Westbrooke neiqhborhood.
Issue: Hopkins has a very high concentration of multi-
family housing units.
Effect: The disproportionately high concentration of multi-
family units means that in a poor rental market the
effect on the City is much greater than on
surrounding cities. Additionally, renters are
typically more transitional which may effect their
degree of involvement with the City.
Recommended Action:
Followinq the strategic planninq process, the
Planninq and Zoning Commission shauld review
the current Land IIse Plan to confirm that parcels
currently zoned for multi-family are appropriately
, zoned. .
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� Issue: Image of the City has an effect on the real estate
market.
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I Effect: If the image of Hopkins is positive, the housing
; market will be less affected by decreasing numbers
� of first-time homebuyers and renters. People will
j continue to look for housing in Hopkins due to its
location and services.
�
Recommended Action:
Continue to implement the recommendations outlined
in the City's Comprehensive Plan and the Strateqic
Plan for Economic Development includinq such items
as improvinq the image of Co. Road 3, developinq a
marketing and public relations plan, continue to
work to bolster the image of the Downtown, to
continue to promote the local festivals, developinq
an information center in Hopkins, maintaininq
adequate buffer zones between new commercial
page 21
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. development and residential properties, continue
City's oaqoinq effort to maintain and improve all
public infrastructure, etc...
Issue: Affordability of housing is a growing problem.
Effect: When renters must pay over 30% of their income for
housing they are unable to save for downpayment
and closing costs on the purchase of a home, pay
� for education, etc...
Recommended Action:
Continue to Zocally administer the section 8 Rental
Assistance Pragram.
Investiqate ways to allow public hausing residents
to become homeowners. The HRA has received a
$100,000 AOPE 1 grant to study the possibility of
selling the 20th Avenue Townhomes to the residents.
This wQUld allow for new construction of public
housing to replace those units lost. �
�
Issue: Hopkins has several single-family homes which are
dilapidated and should be removed. �
Effect: The deteriorated or obsolete properties have a
� blighting effect on the neighborhoods they are
located in. Demolition of the structures and the
redevelopment of the sites would have a positive
effect on surrounding properties.
Recommended Action:
� Identify those properties which should be
demolished and determime proper approach ta take in
order to remove them.
Aqressively enfarce the Nuisance Abatement
Ordinance/Housinq Code in reqard to dilapidated
housinq units. Require the owner of the property
to incur the cost of demolition of the unsafe
structure.
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,� STATUS REPORT ON THE
RECOMMENDATIONS OF THE 1992 CITY OF HOPKINS
H4USING ANALYSIS
� Continue to inspect rental units and enforce the housing code.
Consider the possibility of strengthening the rental inspection
program.
o Strengthened inspection program through combination of
Housing and Residential Fire Inspection Programs
o Currently inspect struct�res containing 4+ rental units
every 2-3 years
o All other rental units inspected on complaint basis
o Currently working on ordinance that would require all rental
� structures containing over two units to request inspection and
obtain certificate of occupancy every 5 years
� Evaluate the Truth-In-Housing Program after one year.
o Staff has evaluated program; appears to be meeting goals
o Approximately 150 evaluations per year; 20% of homes
require hazard corrections
o Problems experienced with evaluators being liberal with hazard
determination due to liability concerns
o Currently working on revisions establishing two types of
hazards, those requiring correction and those not requiring
correction
�
� Evaluate the benefit of adopting stronger housing maintenance ��
❑ �`,
codes.
o Current City Housing Code is �ery general - only covers
residential properties, and does not include accessory
structures and yaxds
o Staff has reviewed three codes. Staff is recommending BOCA
National Housing Maintenance Code
o BOCA Code includes commercial and residential
properties
� Aggressively enforce the Nuisance Abatement Ordinance/
Housing Code in regartl to dilapidated housing units.
o Staff responds to all complaints, conducts routine inspections of
neighborhoods, undertakes`a�iey sweeps twice/year
(corresponding to spring and fall clean-ups). �
0 195 orders issued in 1993; voluntary clean-up of many
more properties
o Nuisances and complaints have increased state wide '
,(�, Identify those properties which should be demolished and
�■, determine the proper approach to take in order to remove
them.
o Difficult to identify based solely on exterior of property
o Preliminary list compiled by value
o Recommend a trial project with a goal of one acquisition in
- 1994/1995
o Estimated cost to City per project -$30,000
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• � Determine interest for a landlord coalition or landlord
workshops,
o First meeting held March 1993; meeting monthly since -
o Topics of ineetings include Tenant Screening,
Crime/Crime Prevention, Discrimination, Legal Issues,
Youth Issues
o Interested in public relations, strengthening ties with
business community, invoiving apartment residents in
community
� Continue to offer first-time home buyer loan program through
MHFA.
o Program offered 1992, 1993, 1994
o$545,258 spent to date; 9�oans made
�
� Continue to offer the Residential Rehabilitation Loan/Grant
Program and promote this program extensively.
o Program advertised a minimum of four times per year in
Sailor and City newsletter
. 0 16 applications received in 1993; 7 applications received
in first 5 months of 1994
� Promote the use of other available rehabilitation programs
through MHFA and other agencies.
o Staff provides referrals as appropriate
�
� Urganize a home remodeling show which would encourage ��
homeowners to make improvements to their property.
o First remodeling show held March 1993 at Activity Center;
joined with St. Louis Paxk and Golden Valley in March
1994 show
0 1995 Home Show scheduled for February 1995 at Eisenhower
Community Center to be held in conjunction with St. Louis Park
and Golden Va11ey
� Encourage the use of existing rental rehabilitation programs
� •
available through MHFA.
o Staff reseaxches and provides referrals to MHFA programs
as applicable
�
� Continue to investigate possible sources of funds for local
rental rehab loan program.
�
o Discussions held with Hennepin Co. HRA with no results
i o Will continue to pursue this issue with Hennepin Co
o Consideration shouid be given to legislation which would
I; provide incentives for owners of multi-family properties to
j make improvements. :
�
�
� Implement the recommendations outlined in the Springsted
� Inc. study according to the work plan.
�
o All of the recommendations of the 1992 work plan have
� been completed or attempted including converting
;
; Westbrooke Way to public road, assist Westbrooke North
i with parking lot improvements bids, pursue financing for �'
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, common area improvements and establishing Property
Manager's Coalition.
� Initiate discussions with FHA, MERF, and lenders wi�h a
substantial interest in the Wesbrooke area in order to identify
roles these organizations may play in the revitalization of the
neighborhood. .
o Staff has had discussions with these organizations with
little or no success
� Following the strategic planning process, the Planning and
Zoning Commission should review the current Land Use Plan
to confirm that parcels currently zoned for multi-family are
appropriately zoned.
• o New goals for the housing section of the Comprehensive Plan
have been adopted by City Council and forwarded to Met
Council
o Upon approval by Met Council, Zoning and Planning
Commission to review individual sites for possible changes to
zoning and/or comp plan
� Continue to implement the recommendations outlined in the
�" City's Comprehensive Plan and the Strategic Plan for
Economic Development including such items as improving
the image of Co. Road 3, developing a marketing and public
relations plan, continue to work to bolster the image of the
Downtown, continue to promote the local festivals,
maintaining adequate buffer zones between new commercial
development and residential properties, continue City's
ongoing effort to maintain and improve all public
• infrastructure, etc...
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o Ima�e of Co.Rd 3- Co. Rd. 3 Corridor study is nearing '
�
completion with construction of first segment between Shady i
Oak Road and 1 lth Ave. to begin in 1996. Tracks have been �
removed from Co.Rd. 3 � �
�
o Marketing/Public Relations Plan - No specific activities have �
occurred. It is anticipated the Communications Coordinator '�
would take the lead on this initiative. '
o Image of Downtown - No specific new initiatives, '
Communication Coordinator could become involved. HBCA is �
planning on undertaking public relations activities which would
assist in this area.
� o Promote local festivals - Ongoing
, o Buffer Zones - Being considered as part of Co. Rd. 3 Corridor
! Study
'i o Improve Infrastructure - Ongoing CIl' provides comprehensive
� plan for improvements
�:.1 Continue to locally administer the Section 8 Rental Assistance
Program �
o Currently average of 132 contracts in Hopkins; 36% increase in
last five years �
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Investigate ways to allow public housing residents to become
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homeowners.
o Attempted through HOPE program; invesitigating other
options
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Offer Home Buyer's Seminars in conjunction with a local
� �
lender.
o Has not been attempted; lenders offering this service �
STATUS REPURT ON THE
NEIGHBORHOOD GOALS OF THE STRATEGIC PLAN FOR
ECONOMIC DEVELOPMENT
� Assure strong and well maintained neighborhoods in order to
foster an overali positive economic development climate in .
Hopkins.
o Facilitate develo�ment which helps meet "special needs"
housin - Assisted in the development of the handicapped
• housing project; continue to support "special needs
housing includmg senior, 3-bedroom family, and luxury.
o Review Zoning standards - Staff has attempted to examine
appropriateness of zoning standards related to
rehabilitation of existing non-conforming uses; found
City's standards to be less restrictive than surrounding
cities. Scheduled to be discussed with Planning and
Zoning Commission
o Examine.guidelines for buffer areas - Scheduled to be discussed
with Planning and Zoning Commission
� Foster communication and cooperation between the City,
neighborhoods, schools and the business community.
o Develope a nei�hborhood outreach pro�ram and
Nei�hborhood Advisorv Board - NAB established and
have held 12 meetings
� .
. �
and Community in Partnership (SCIP), Family Resource :
Center and pro�ects such as Westbrooke Community ;
Connections '
,
o Coordinate active distribution of "new resident packets" - ;
Currently redesigning the "new resident packet" to appeal �
to a wider audience including apartment complexes, '
Realtors, etc...
o Closely examine impac� an neighborhoods when
considerin� chan�,es in Citv services - Citizens involved in
I� a e collection s stem throu h surve
, modifying the garb g y g y
techniques and individual choice
�� .
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RECOMMENDATIONS FOR CONTINUED ACTIVi�'IES
o Continue to implement the recommendations of the Strategic
Plan for Economic Development and the Housing Analysis for
the City of Hopkins
PROPOSED NEW INITIATIVES
o Consider adoption of BOCA National Housing Maintenance
Code
o Consider amending rental inspection program to include
• inspection of 2+ unit properties
o Design acquisition/demolition program with the goal of one
acquisition in 1994/1995
o Implement legislation authorizing City to create Residential
Service District for Westbrooke neighborhood
o Investigate possible special legislation to encourge rental
property improvements
o Through Communications Coordinator, develop and implement
a marketing and public relations plan for the City. Participants
in the planning include the City, NAB, HBCA, Property
Manager's Coalit�on and School District.
�
• QUESTIONS AND ANSWERS REGARDING THE QF HOPKINS
HOUSING REHABILITATION LOAN/GRANT PROGRAM
What are the general guidelines for the Rehabilitation Loan/Grant Program?
To be eligible for a loan or grant through the Rehab Program an applicant must meet
the following guidelines:
o Meet the income guidelines based on family size (example: family of
four must earn less than $25,500 to qualify for a grant, $39,900 to
qualify for a loan)
o Have equity in the property equal to the loan or grant amount
o Have less than $25,000 in assets
The City offers loans at 3% interest over a 12 year period, grants which are forgiven
over 6 years and a combination of half loan, half grant. The maximum loan or grant
amount is equal to the equity the homeowner has in the property, to a maximum of
$15,000. Eligible improvements include the correcfion of code violations, incipient
� code violations and energy saving improvements.
How is the program funded?
The program is primarily funded through the Community Development Block Grant
(CDBG) Program, at approximately $100,000 per year. The City also has
established a revolving loan fund (the #213 account) fiinded through rehabilitation
loan repayments. The Housing Coordinator's salary, as well as an occasional rehab
project, is funded through this account.
What are the equity requirements for the Loan/Grant Program?
The amount of the loan or grant the applicant can receive is equal to the equity they
have in the property. Equity is deternlined by subtracting the balance of any
mortgage against the property from the Estimated Market Va1ue or from the value as
determined through a recent appraisal.
Equity is required so that the loan or grant is reasonably secured should the
, homeowner default on his or her loan or decide to sell the property. Hennepin
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County, as the regulator of CDBG funds, requires both the loans and grants to be ��
reasonably secured. �
Why do we require equity in grant situations? '
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A grant is not required to be paid back provided the homeowner continues to own i
and occupy the property for a period of six years after the grant is made. However, I
if the property is sold or the owner discontinues occupancy of the property within �
this six year period, the grant becomes due and payable. If there is not su�cient ;
value in the property to pay debts at the time of sa1e, it becomes difficult for the
owner to sell the property (because they would have to pay the balance to clear the �
title) and if the owner defaults, it is dif�cult for the City to collect the money owed. �
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The six year lien period for grants is considerably less than most cities guidelines !
and is required in order to prevent individuals from purchasing properties, using the
rehab grant program to make improvements and then selling the properiy at a profit. i
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Do the various funding sources available allow the City greater flexibility in
,
program requirements? Would it be possible to have an "a" program and a �
"b" program with different requirements? ��
� II
Yes, while the CDBG funds have very strict guidelines that must be adhered to, '
funds in the #213 account have no requirements for their usage. However, in
administering the rehab program it is very important to be consistent in order to be
fair to a11 applicants and to assure a consistent use of fiulds.
Why must all health or safety code violations be corrected if any portion of the
project is funded though the loanigrant program? �
This requirement is a Federal requirement tied to CDBG funds. The reasoning is
that federal funds cannot be used to support a property that after rehab is not safe to
occupy. It is important to realize that the requirements are not that a11 code
violations be corrected, rather that a11 health or safety threats be eliminated.
How many applicants are turned down for the program because they are
unable to complete all health or safety repairs?
Very few. Over the past four years there have been no applications denied based on
this situation. �
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