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Community Housing Development Corporation (CHDC) Plans; Elverum CITY OF HOPKINS Memorandum To: Honorable Mayor and Council Members Mike Mornson, City Manager From: Kersten Elverum, Director of Planning & Development Date: January 14, 2020 Subject: Community Housing Development Corporation (CHDC) Plans _____________________________________________________________________ PURPOSE The purpose of the discussion is to introduce a proposed plan from CHDC regarding improvements to Raspberry Ridge and an infill development adjacent to the Hopkins Village Apartments. INFORMATION In 2016, CHDC undertook significant improvements to Hopkins Village Apartments and at that same time applied to replat the property into two separate parcels for the purposes of allowing for a future infill development on the existing, but underutilized, parking lot to the east of the apartments. The intent was to construct a housing development that would be designed to be affordable to individuals and families of moderate income – otherwise known as workforce housing. It has taken some time to find financing opportunities for that market, as most affordable housing financing would target lower income households and traditional market rate financing would be geared towards the luxury market. CHDC has identified a path forward using a unique model that would also provide funds to make significant improvements to Raspberry Ridge, preserving that development as affordable housing going forward. The plan relies on securing National Register of Historic Places designation for Raspberry Ridge and the Hopkins Activity Center which will unlock tax credit dollars that can be used for the renovation and using the incomes of Raspberry Ridge residents to blend with the higher incomes of the residents of the new construction component, thereby meeting maximum income thresholds. A component of this would also involve using the City’s bonding authority to issue conduit financing. The City has done that in the past for other and it does not hold the City to any responsibility for the debt. Attached are several pieces of information from CHDC including a detailed description of the improvements, background on the historical designation and issues to consider. Planning & Economic Development FUTURE ACTION There will be a series of City Council actions needed to approve the proposed activities including land use approvals for the infill development and approval of an agreement on the application to the National Register of Historic Places. The discussion at the work session will serve as the introduction to these future decisions. Section 8 Preservation and New Construction in Hopkins In fall 2020, Community Housing Development Corporation (“CHDC”) intends to refinance and renovate Raspberry Ridge and build a new affordable development for families. Where and what are the two developments? The properties will be legally combined and provide general occupancy permanent affordable rental housing primarily for seniors and families. Raspberry Ridge is located at the west end of Main Street. It is a 10-building complex that contains a mix of one, two and three bedroom townhomes and apartments in the old South Junior High School building. Parking is shared with the city’s Activity Center. All of 101 units at Raspberry Ridge have project-based Section 8 rent assistance, which means residents pay 30% of their income regardless of the amount. The new apartment building, called Hopkins Village II, will be located at the east end of Main Street. It will be four-stories with enclosed parking and a mix of one, two and three bedroom apartments affordable to households up to 80% area median income (AMI) with an overall average of 60% AMI including Raspberry Ridge. Surface parking will be shared with the Hopkins Village senior high rise. What are the goals and priorities of the development project? At Raspberry Ridge: • Preserve affordability and the project-based Section 8 rent assistance. • Address critical physical needs and improve livability. At Hopkins Village II: • Add workforce housing for families in one of the best metro locations. • Fit into the local context and activate the first floor along Main Street. • Not need scarce financial subsidies from the city such as TIF. What will CHDC request from the city? • Land use (likely PUD) approval for Hopkins Village II. • Approval to add the Hopkins Activity Center to the National Register for Historic Places. • Issue tax exempt housing revenue bonds from the state on a conduit basis. Section 8 Preservation and New Construction in Hopkins Why do this now? • There are a number of critical physical needs that cost more than Raspberry Ridge has in reserves, and CHDC’s lot on the east end of downtown should not sit vacant. Interest rates are near historic lows, which means we can secure adequate funds without scarce city financial assistance. What are the anticipated renovation activities at Raspberry Ridge? • Replace the original mechanical, electrical and security systems and roofs. • Replace old unit and common area fixtures and finishes. Add dishwashers, washers-and- dryers, built-in microwaves and ceiling fans to the units. • Improve common areas including the main entrance and community rooms and add new amenities such as fitness and computer rooms. • Improve the parking and site. • Upgrade all building exteriors as needed for asset protection and energy and water efficiency improvements. When will the construction activities begin? Working towards September 2020. Who lives at Raspberry Ridge, and what will happen to them? CHDC is working with on-site management staff and Activity Center staff to schedule a meeting with residents on a Saturday afternoon in the next few weeks. The Section 8 rent assistance will remain indefinitely. The development will follow Federal Uniform Relocation Act requirements and does not anticipate displacing any current residents. Most residents will occupy their units during construction. If a resident has a special circumstance, he or she may be temporarily relocated for a few days at a nearby hotel. The project will pay for all relocation related expenses and has hired a relocation consultant to create a comprehensive plan and make sure resident needs are met. The development team will also ensure the general contractor has a strong track record with occupied renovations. How will Hopkins Village parking change with the new construction? The Hopkins Village senior high rise will share the site with the new construction development. Currently, Hopkins Village has nearly one surface parking stall (157 total) per unit and would have approximately 0.5 stalls (83 total) per unit post construction. • The proposed number of stalls appears to comply with zoning. • On-site management reports less than half the stalls are utilized by residents. Many seniors don’t have cars. The Hopkins Village II new construction will have enclosed parking with approximately 1.3 spaces (43 total) per unit. The development will commission a parking study as part of the land use approval process with the planning commission. EVALUATION OF NATIONAL REGISTER ELIGIBILITY: THE RENAISSANCE APARTMENTS AND TOWNHOMES AND THE HOPKINS ACTIVITY CENTER 27-33 FOURTEENTH AVENUE NORTH HOPKINS, MINNESOTA PREPARED BY JENNA REMPFERT, HISTORIAN CHARLENE ROISE, PRINCIPAL INVESTIGATOR HESS, ROISE AND COMPANY 100 NORTH FIRST STREET MINNEAPOLIS, MINNESOTA 55401 JULY 2019 South Junior High, ca. 1926 (left), and Renaissance Apartments, 1981 (right) Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 1 Introduction In April 2019, Dan Walsh, Vice President, Housing Development, Community Housing Development Corporation (CHDC), retained Hess, Roise and Company (Hess Roise) to evaluate the eligibility of the Renaissance Apartments and Townhomes (Raspberry Ridge Apartments and Townhomes) and the Hopkins Activity Center for listing in the National Register of Historic Places (National Register). Hess Roise historian Charlene Roise served as the project manager and edited this report. Historian Jenna Rempfert evaluated primary and secondary source materials and wrote the report. Both visited the site. Research was conducted at the Hopkins Historical Society in May 2019. Additional research materials were provided by the CHDC and the Brighton Development Corporation (BCD) from organizational and office files. The CHDC anticipates undertaking rehabilitation work at the Renaissance Apartments and Townhomes and is considering historic tax credits as a potential source for financing this work. To be eligible for the credits, which are offered by both the federal government and the State of Minnesota, properties must qualify for the National Register of Historic Places. To merit designation, a property must have significance related to American history, architecture, archaeology, engineering, and culture. Specifically, a property must meet one or more of the following criteria: Criterion A: be associated with events important to broad patterns of history; Criterion B: have a significant association with the life of an important person; Criterion C: represent a type, period, or method of construction; or be the work of a master; or express high artistic values; or Criterion D: yield, or be likely to yield, information important in prehistory or history. In addition, properties must retain integrity. Integrity is defined as a property’s ability to convey its significance, which is based on seven aspects: location, design, setting, materials, workmanship, feeling, and association. The Renaissance property was constructed as a school in 1925 but was substantially altered in the early 1980s when it was converted into apartments and the Hopkins Activity Center. As a result, its integrity as a school is poor. For the property to qualify for the National Register, the 1980s conversion must be significant and the property must maintain integrity from that period, its “period of significance.” The passage of time provides perspective on what is historically significant, so National Register properties are usually significant for more than fifty years before they are listed. Under Criteria Consideration G, however, the National Register allows designation of properties that have achieved exceptional importance within the past fifty years. Because the potential significance of the Raspberry Ridge Apartments began in the 1980s, the property must meet Criteria Consideration G in addition to meeting one or more of the four criteria and retaining integrity. Finally, because the Renaissance Apartments and Townhomes was historically associated with the Hopkins Activity Center and is physically connected to the center, the National Register eligibility of the entire complex must be evaluated. Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 2 Site Information The Renaissance Apartments and Townhomes and the Hopkins Activity Center are located on the north side of Mainstreet in downtown Hopkins, Minnesota. The property consists of the apartment building, thirty-six townhouses, the Hopkins Activity Center, a playground, and several parking lots (Figure 1). The site occupies approximately three-fourths of the two blocks between Fourteenth Avenue North and Twelfth Avenue. The entire site is historically associated with the school. Apartment Building The apartment building sits atop Harmony Hill, between Fourteenth Avenue and Thirteenth Avenue. Originally constructed as a school in 1925, the building was converted into subsidized housing units between 1979 and 1981. The conversion significantly altered the two-story, brick- clad school building, which originally had two wings separated by an auditorium. Although the two wings remain, the auditorium was removed to create an interior courtyard. The courtyard extends to the front (south) facade, which was retained during the conversion. Because the auditorium walls were removed, the interior courtyard is clad in stucco. The original brick cladding remains on the exterior walls, but windows were replaced with smaller units and vinyl siding was added to reduce the size of the historic window openings. Figures 2 through 7 on the next page provide current and historic views. Figure 1. Property Site Plan. (Hopkins Historical Society) Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 3 Figure 4. West wall in 1934, looking east from Fourteenth Avenue. (Hopkins Historical Society) Figure 5. West wall in 2019, looking northeast from Fourteenth Avenue. Figure 6. Courtyard in 2019, looking south. The walls at the south end of the courtyard, an area once on the interior of the school, are clad in stucco. Figure 7. Courtyard and bridge between the wings in 2019, looking south. Figure 2. Front facade in 2019, looking north. Figure 3. Front facade ca. 1926. (Hopkins Historical Society). Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 4 Additions The original school building had two expansions, both located at the rear (north) of the west wing. An addition was constructed in 1936 with assistance from the Public Works Administration and enlarged in 1957 (Figures 8 and 9). When the school was converted into apartments, a Quitclaim Deed transferred the title for both additions to the City of Hopkins. The additions were renovated separately from the apartments to house the Hopkins Activity Center, which was opened in 1981 and remains in operation today. The addition’s brick walls are lighter in color than the original school’s brick. Like the school, the addition’s windows have been replaced and the openings reduced and infilled with siding, which also clads a second-story area. The city updated the center in 1991 to add a glass panel entry at the northwest corner. Townhouses The townhouses were constructed as part of the school conversion project from 1979 to 1981. Situated in the former schoolyard and parking lot, the townhouses are in two distinct clusters. One group, oriented linearly, is located to the north of the apartment building along North First Street. The other group forms an L-shape to the east of the school along Thirteenth Avenue (Figure 10). Each two-story townhouse building holds three to five units and is clad in vinyl siding with a gable roof covered in asphalt shingles. Figures 11 through 13 illustrate typical townhouses. Left: Figure 8. Aerial photograph of South Junior High School in 1956 showing the first school addition. (Minnesota Historical Aerial Photographs Online) Right: Figure 9. Aerial photograph of South Junior High School in 1960 showing the second school addition. (Minnesota Historical Aerial Photographs Online) Figure 10. Aerial photograph, 2000. (Hennepin County Aerial Imagery Viewer) Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 5 Figure 11. Row of five townhouses along First Street. Looking northeast from parking lot. Figure 12. Row of four townhouses along Renaissance Court, looking northeast from parking lot. Figure 13. Row of five townhouses along First Street, looking northeast from Hopkins Activity Center parking lot. Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 6 Historic Context The former South Junior High School originally functioned as a combined elementary and junior high school to serve the small farming community of Hopkins. When Hopkins evolved into a modern suburb around mid-century, new school facilities were constructed to accommodate the rising student population. Although elementary students were transferred to the new Katherine Curren Elementary School in 1946, enrollment at South Junior High skyrocketed over the next decade when the school district expanded. In 1954, portions of Minnetonka, Edina, Saint Louis Park, and Golden Valley were incorporated into newly formed Hopkins School District 274. As South Junior High was the only junior high school in the district, overcrowding became so severe that seventh graders were moved to the old high school building, called “the Annex,” after the Eisenhower High School opened in 1955. Despite the completion of an addition to South Junior High School in 1957, the Hopkins Review concluded that the school was overcrowded “to the point of desperation.” To alleviate these concerns, the school district constructed two junior high schools in Minnetonka, North Junior High in 1958 and West Junior High in 1967.1 The construction of West Junior High marked the end of the period of expansion for the Hopkins School District. While the outlying suburbs, including Minnetonka, Wayzata, Eden Prairie, and Burnsville, experienced moderate growth into the early 1970s, the population of Hopkins began to decrease. As student enrollment in the school district dropped, the school board struggled to operate all of its facilities. Declining enrollment, combined with a $560,000 budget deficit, prompted the school board to close Katherine Curren Elementary and the Annex in 1975. There were also deliberations on the closure of a junior high school. Because downtown Hopkins experienced the most significant drop in enrollment, South Junior High was slated for closure at the end of the 1976-1977 school year. The announcement was paired with a district-wide reduction in staff and the removal of school programs to reduce the budget deficit.2 The Problem of Surplus Schools The reduced enrollment at South Junior High followed a national trend. The nation’s inner-ring suburbs experienced a surge of population at mid-century, stimulating the expansion of facilities in many school districts. However, this period of growth was short-lived. By the 1970s, children of the baby boom had graduated from high school and their aging parents often opted to remain in their suburban homes. As a result, many inner-ring suburbs experienced a sharp decline in birth rates at the end of the decade. A decrease in school enrollment followed, exacerbated by the rising price of single-family homes. Because many young families with school-aged children were priced out of suburban homeownership, enrollment at suburban schools was expected to plummet into the 1980s. Many of these school districts had surplus classroom space, which began to drain district resources and funding. With the pace of decreasing enrollment expected to 1 Clint Blomquist, “The Rebirth of South Jr. High School,” Hopkins Review, November 26, 1980; Beverly O. Ewing, ed., Hopkins, Minnesota Through the Years (Hopkins: Hopkins Historical Society, 2002), 90-92; “These Are Your Schools: Junior High Built in 1925 Originally Housed All Grades,” Hopkins Sun, November 7, 1957. 2 Markie Harwood, “Five-Page Document Symbol of Depth of School Crisis,” Hopkins Sun, January 19, 1977; “South Junior High to Be Closed,” News and Views: 274 Hopkins Independent School District 14 (May 1976). Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 7 accelerate into the 1980s, many school boards across the country faced tough decisions concerning the closure of schools.3 School closures were especially common in Minnesota, where many suburban school districts received insufficient state aid under a new scheme called the “Minnesota Miracle of 1971.” Prior to the 1970s, Minnesota schools were predominately funded through property taxes and levy referendums. For school districts in affluent suburbs, the combination of high property values and tax levies resulted in increased funding, while outlying areas with lower property taxes struggled to fund their schools. The Minnesota Miracle initiated a statewide policy to equalize education through the implementation of levy limits and a new state-aid formula. The formula was tied to school enrollment, which negatively impacted first-ring suburbs with declining school enrollments. As enrollment rate in Hopkins, Edina, Golden Valley, Richfield, and Saint Louis Park were projected to drop another 20 percent by 1981, many Twin Cities suburbs responded by closing schools.4 The decision to close a school was often contentious. School boards faced opposition from families living in the school district and accusations of socioeconomic favoritism. Although demographics factored into decisions, the aftermath of school closures was the predominant concern of many communities. Some school boards mothballed surplus schools, which became “boarded-up neighborhood eyesores,” according to a news article. Other school districts hoped to generate revenue by selling or leasing surplus schools to public or private entities. Within their communities, vacated school buildings were often recognized as valuable community resources. Although residents often had strong sentimental ties to their former schools, tight economic conditions and municipal zoning regulations prevented many buildings from being reused. “Most of them will eventually be torn down,” the New York Times noted. The school districts that managed to sell surplus properties were considered “more lucky than most.”5 The Undecided Use of Hopkins South Junior High When the closure of South Junior High was announced in 1976, the school board was determined to sell or lease the property. One of the reuse options most favored by local residents was to convert the building into a community or recreational center. Although nearly 90 percent of Hopkins residents indicated that they would use a community center, the city lacked the funding to purchase, or even rent, space at South Junior High. Civic leaders in Hopkins formed the Community Center Executive Committee in 1976 to find a tenant willing to share the building with the community center, as the layout was particularly well-suited for multiple uses. The original school building, comprised of two wings of classrooms and an auditorium, was separated from the two rear additions (Figures 15 and 16). In this multi-use concept, the other tenant would lease the original school building and the city’s community center would be located 3 Mark E. Mertens, “Where Have All the Robins Gone? Power , Discourse, and the Closing of Robbinsdale High School” (PhD diss., University of Saint Thomas, 2013), 3; Patricia Paulson White, “Empty Corridors: The Legal Aspects of the Closure and Sale of Surplus Public Schools,” Santa Clara Law Review 16 (January 1976): 505; U.S. Congress, House, Surplus School Conversation Act, HR 12947, 94th Cong., 2nd sess., introduced in House April 1, 1976. 4 “Next Decision Junior High Boundaries,” 1976; Markie Harwood, “Athletics, Faculty Head List of Budget Cutbacks,” Hopkins Sun, January 9, 1977; Patrick Vick, “Cutting Back is ‘New’ for Schools,” Hopkins Sun, January 16, 1977; Patrick Vick, “School-Aid Showdown Expected,” Hopkins Sun, January 19, 1977. 5 Ernest Dickinson, “Surplus Schools the White Elephants of Suburbia,” New York Times, October 12, 1975. Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 8 in one of the additions. The city considered this option to be “the best of both worlds,” as the rent earned from a private use would offset the cost of the community center. The property, including the 91,000 square-foot school building and the 3.5-acre parcel, was available for lease after the conclusion of the school year on July 1, 1977.6 Although newspaper reports indicated that there was high interest in South Junior High, the school board struggled to find prospective tenants. Several companies enquired about the property, but the only substantive plan was from the U.S. Department of Labor in June 1977 to convert the school into a federal Job Corps training center to prepare high school dropouts to enter the workforce. Although the presence of Job Corps program would bring an estimated $1 million in revenue to Hopkins, the proposal was contested by the community. According to the Hopkins Sun, of primary concern were the “after-school problems” caused by an influx of young adults to the city. The few supporters indicated that they were “not overjoyed,” but considered a Job Corps training center to “be a good use of the building.” Others feared that the building would no longer have space for a community center. With little support for the Job Corps 6 Jackie Armstrong, “Potential Tenants Eye South Junior High,” Hopkins Sun, April 20, 1977; “Tenant/s [sic] Wanted: Building Available – July 1, 1977,” News and Views: 274 Hopkins Independent School District 15 (May 1977); Jackie Armstrong, “South’s Fate May Go to Voters,” Hopkins Sun, August 17, 1977; E. J. Young, “Rental Costs for South Junior High,” February 11, 1977. Figure 15. First-floor plan of original Hopkins South Junior High building in 1977, at the time the school closed. (Hopkins Historical Society) Figure 16. Plan of rear addition to school. Like Figure 15, this dates from 1977. (Hopkins Historical Society) Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 9 proposal, the Hopkins School District was unable to find a tenant for South Junior High by the end of the summer.7 After the Job Corps proposal fell through, the school board remained determined to sell or lease the property. In August 1977, the school board contacted the Technical Assistance Corporation for Housing (TACH) concerning the disposition of South Junior High and the Annex building. TACH, an Illinois-based consulting firm that specialized in low- and moderate-income housing projects, searched for a developer to convert both properties into apartment units. By the end of 1977, the firm was successful in securing the interest of a prominent syndicator-development agency, the National Housing Partnership (NHP), for both projects. The NHP was a federally charted, private entity. Formed by Congress at the end of the Johnson administration, the purpose of the NHP was to form limited partnerships with local enterprises to finance low- and moderate- income housing projects.8 The Federal, State, and Local Role in Affordable Housing Beginning in the 1970s, the matter of affordable housing options became increasingly pressing. In Minnesota, lawmakers were especially concerned about the slowing housing market. The national cost of a single-family house jumped from $23,400 to $44,299 between 1970 and 1976, which made homeownership out of reach for many Minnesotans. As the construction of new homes slowed in response, the market for existing homes became increasingly competitive. This resulted in higher prices, despite the deteriorating state of Minnesota’s existing housing stock. Over one-half of housing units in the state, including both single-family and multi-family dwellings, were constructed before 1940. With many substandard houses and the housing market at a near standstill, the state launched the Minnesota Housing Finance Agency (MHFA) in 1971. The agency’s purpose was to assist in funding affordable housing options throughout the state. To reach this goal, the MHFA sold mortgage-backed revenue bonds to finance affordable housing projects. The interest payments from the revenue bonds were tax-exempt, which offered additional incentive for investors to purchase the bonds.9 The MHFA represented Minnesota’s efforts to assume the broader responsibilities for housing previously supported by the federal government. Although the federal government was involved in housing assistance since the 1930s, policy matured at mid-century with the authorization of the Housing Act of 1949. The act not only provided a national framework for slum clearance and urban redevelopment, but also created a public housing program that offered subsidies to local authorities for the construction of low-rent, public housing units. Over the next two decades, the federal government expanded its role in housing assistance by subsidizing private development. The Housing Act of 1961 insured low-interest mortgages to private developers as part of the 7 Jackie Armstrong, “Job Corps Asks Lease Price on Hopkins South,” Hopkins Sun, May 20, 1977; Jackie Armstrong, “Job Corps Tenancy Needs Study: Miller,” Hopkins Sun, June 3, 1977; “Public Hearing on South Disposition,” Hopkins Sun, June 17, 1977; Jackie Armstrong, “Proposed Jobs Corps Residence Meets Resistance from Citizens,” Hopkins Sun, June 24, 1977; “Hopkins Merchants Not Opposed to Jobs Corps,” Hopkins Sun, July 27, 1977. 8 Illinois Housing Development Authority, “A Proposal to the Ford Foundation to Fund a Technical Assistance Corporation for Housing in Illinois,” May 21, 1969, 4. 9 “Federal Rules Blamed for High Cost of Housing,” Hopkins Sun, February 25, 1977; “Statement of Governor Wendell Anderson on Major Housing Rehabilitation Program He Will Submit to the 1974 Minnesota Legislature,” November 1973, 1-8; “Minnesota Housing Finance Agency: Summary of Activities,” November 1973, 1 -3. Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 10 Below Market Interest Rate program. Although the program was replaced several years later, the requirement for developers to make housing units available for low- to moderate-income tenants laid the framework for future policy. In addition to subsidies for private developers, a new rental assistance program for tenants was implemented in 1965 by the U.S. Department of Housing and Urban Development (HUD). Established by Congress that year, HUD continued to expand housing policy for tenants and developers until the early 1970s. In 1973, the Nixon administration placed a moratorium on federally sponsored housing projects in a broader effort to dismantle federal involvement in urban renewal. In the wake of federal divestment, Governor Wendell Anderson stated that Minnesota would not “depend on the federal government alone to solve housing needs” and subsequently expanded the role of the MHFA to encourage the construction of subsidized housing.10 Although the federal funding moratorium was short-lived, the subsequent Housing and Community Development Act of 1974 shifted the responsibility for housing to state and municipal governments. While the legislation did offer a dedicated subsidized rent program for tenants under Section 8, it also removed direct federal oversight of redevelopment grants. Instead, the Community Development Block Grant (CDBG) program offered more flexibility in the state and city allocation of funding through block grants. These could be used for a variety of projects including community centers, housing rehabilitation projects, public parks, energy conservation measures, and other general public works projects.11 As concern over affordable housing options continued to grow through the 1970s, the reauthorization of the Housing and Community Development Act in 1977 tightened regulations to influence low- and moderate-income housing projects. Although refinements to the CDBG program still emphasized local decision-making, HUD required cities to specify “activities designed to revitalize neighborhoods for the benefit of low- and moderate-income persons” in the application. The revised application process required a Housing Assistance Plan to outline specific efforts to develop subsidized and affordable housing units. If a city was unable to demonstrate a commitment to offer housing assistance, often through participation in the Section 8 subsidized rent program or construction of affordable rental options, it was unlikely it would receive a grant.12 The City of Hopkins had received grants since the program’s initiation in 1974. The updated requirements when the program was reauthorized, though, posed a problem for the city’s application in 1978. While Minnesota prioritized affordable housing measures, Hopkins did little to assist its moderate- to low-income residents. Only sixteen out of two-hundred applicants to the Section 8 subsidized rent program were successfully placed in 1975 due to limited rental options in Hopkins. The next year, the city withdrew from the program entirely. Jim Kerrigan, the 10 Maggie McCarty, Libby Perl, and Katie Jones, “Overview of Federal Housing Assistance Programs and Policy,” prepared by Congressional Research Service for Members and Committees of Congress, 2010, 4 -5. 11 Department of Housing and Urban Development, “Chapter 1: New Directions in the CDBG Program,” in Community Development Block Grant Program, Third Annual Report, March 1978, 20. 12 Steven H. Blumenthal, “Housing for the Poor Under the Section 8 New Construction Program,” Journal of Urban and Contemporary Law 15 (January 1978): 281-282; Stacey A. Sutton, “Urban Revitalization in the United States: Policies and Practice,” United States Urban Revitalization Research Project, June 25, 2008, 33-34; “Federal Rules Blamed for High Cost of Housing,” 1977; John C. Teaford, “Urban Renewal and Its Aftermath,” Housing Policy Debate 11 (2000): 459-460. Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 11 Hopkins Community Development Officer, urged city officials to reinstate the program. Because the city was “doing nothing to solve its housing problems,” Kerrigan noted that Hopkins would likely not be approved for the CDBG program. Kerrigan believed the city’s participation in the subsidized rent program would show a willingness to provide housing assistance, which would boost its chances. As a result, Hopkins officials reinstated the program in 1977 because the CDBG program would allow the city to continue improving the downtown area13 The “Renaissance” of South Junior High School Although Hopkins re-entered the subsidized rent program, the city was more concerned with funding the anticipated community center than in providing housing assistance. After the school board officially announced plans to sell South Junior High School to the NHP in December 1977, it gave the city an option to purchase part of the building for $350,000. The city planned to use block grant funds to purchase and redevelop the space, as it had used federal funds for similar capital improvement projects in the past. However, advisers from HUD warned that the community center was no longer an eligible activity because it did not primarily benefit low- to moderate-income residents of Hopkins. To get past this obstacle, the city expanded the CDBG application to include funding for the proposed conversion of South Junior High into subsidized apartments even though the city had little interest in supporting the project.14 The developers intended to finance the South Junior High project with the MHFA’s revenue bond program, but project costs exceeded the MHFA’s maximum allotment. Because South Junior High was included in the CDBG application, the TACH turned to the city council, asking for a contribution from the city’s block grant to fund a small fraction of the $4.3-million project. This proposition was met with reluctance. While the resolution for a $150,000 loan was ultimately approved, it only passed because city council members were concerned about losing block-grant support for the community center. The TACH was unsatisfied with the small amount allocated because the city would not have qualified for the CDBG program without the conversion of South Junior High. “The city is reaping advantages very few cities have reaped, loaning federal funds,” said a TACH spokesman. To add insult to injury, the city provided the money to the project as a loan rather than a grant, which was preferred by HUD. As a result, the city got income from the interest and could ultimately anticipated repayment of the principal. Additionally, the grant was intended to improve the lives of low- and moderate-income families, but anyone could use the city’s community center.15 Despite concerns over the grant, the TACH and the NHP received initial approval of funding from MHFA in April 1979 and began plans to convert South Junior High into the Renaissance Apartments in earnest. The architecture firm Rieke Carroll Muller Associates, based in Hopkins, was in charge of the design. Although the primary facades of the historic school building would remain, the interior would be completely gutted. The windows on the facade and the auditorium would be removed to create a private, enclosed courtyard. The original elementary wing and 13 Markie Harwood, “Subsidized Rent Plan Approved in Hopkins,” Hopkins Sun, February 18, 1977; Gabby Landsverk, “Hopkins Community Remembers Jerre Miller,” Sun Sailor, February 20, 2017. 14 “City Gets First Okay on Federal Fund Bid,” Hopkins Sun, August 2, 1978; “HUD Says Grant Must Aid City’s Low-Income Citizens,” Hopkins Sun, December 7, 1977; Tim Lassiter, “HUD Rep Pulls the Plug on Swimming Pool Plan,” Hopkins Sun, November 7, 1977. 15 “City Gets First Okay on Federal Fund Bid,” 1978; “Council Approves Loan for South Junior High,” Hopkins Sun, June 13, 1979. Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 12 junior high wing flanking the courtyard would provide 65 apartment units. Another 36 townhomes were planned for the rear school yard, for a total of 101 units. Each of the proposed units was approved for federal subsidies for low- and moderate-income residents.16 As plans progressed, the transformation of South Junior High set a precedent for the area. “This may not only get statewide attention,” said a Paul Hyatt of TACH, “it may get national attention as a well-planned reuse of a school.” Other surplus schools in the district did not have similar fates. The proposed conversion of the Annex, which was originally planned to be converted into apartments for the elderly, was not approved by the MHFA and the building was demolished in the 1980s. A reuse could not be found for Katherine Curren Elementary, which was eventually reincorporated into the school district.17 Following the approval of funding and the housing plan by the MHFA, a complex ownership structure was set up. As the MHFA could only finance projects for non-profit groups, the Hopkins Renaissance Associates was formed. Its purpose was to manage the property and enter into a limited partnership agreement with the NHP, which owned the property. A mortgage agreement was finalized on October 2, 1979, between the Hopkins Renaissance Associates and the MHFA. Construction began later that month. Renters applied to live in the housing units in early 1980, and by 1981, half of the apartments were occupied, with a waiting list for the rest.18 The Community Housing Development Corporation (CHDC) acquired the Renaissance Apartments from the NHP in 1996 and renamed the property Raspberry Ridge. The Renaissance Apartments Associates entered into a limited partnership with CHDC that year, and retained maintenance responsibilities until 2000, when Brighton Development Corporation (BDC) assumed management of the property. In 2008, after more than a quarter century as housing, the property needed an update. The interior scope included replacing cabinets, countertops, sink fixtures, and vanities for apartment and townhome units. The project also replaced roofs on the townhouses, updated the apartment building’s HVAC system, and installed a new hot water heater. Flannery Construction of Saint Paul was the contractor. Today, the Raspberry Ridge Apartments remain an affordable rental option in Hopkins and residents with low- to moderate- incomes still participate in HUD’s Section 8 rent subsidy program.19 16 Janey Gohl, “South Junior High School Building Keeps Original Facade, Gets New Life,” Hopkins Sun, February 14, 1979. 17 “School Board to Sell South,” Hopkins Sun, December 21, 1977; “‘High’ Living Possible for Old South School,” 1978; “Plan for South Junior High Progresses,” Hopkins Sun, November 15, 1978. 18 Patty Miller, “South’s Future Use Is Still Undecided,” Hopkins Sun, December 2, 1977; “School Board to Sell South,” 1977; “Urban Renewal Projects Given High ’78 Priority by Officials,” Hopkins Sun, December 30, 1977; “‘High’ Living Possible for Old South School,” 1978; “Plan for South Junior High Progresses,” 1978; “Hopkins School Now Holds 65 ‘Renaissance’ Units,” Minneapolis Star Tribune, February 14, 1981. 19 “Standard Form of Agreement Between Community Housing and Development Corporation and Flannery Construction, Inc.,” June 9, 2008; John Reinan, “Streetscapes: Mainstreet in Hopkins Is to Be Admired – Not for Form, But for Function,” Minneapolis Star Tribune, July 17, 2015. Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 13 Assessment National Register Eligibility The property—including the Renaissance Apartments and Townhomes and the Hopkins Activity Center—appears to be eligible for listing in the National Register under Criterion A in the area of Community Planning and Development (Figure 17). The conversion of South Junior High School into a subsidized apartment complex is significant for its association with affordable housing initiatives in the late 1970s and early 1980s. As the price of housing increased during this period, federal and state agencies began to incentivize private developers to construct low- to moderate-income housing projects. The Community Development Block Grant program, enacted by the Housing and Community Development Act of 1974, provided cities with funding contingent on the development of affordable housing units. State assistance programs, such as the one offered by the Minnesota Housing Finance Agency, also supplemented federal initiatives by selling tax-free bonds to investors, using the proceeds to construct low- to moderate-income housing. The Renaissance Apartments and Townhomes project used both methods of funding to provide one of the only low- to moderate-income housing in options in Hopkins at the time. Although a number of affordable housing projects in the state took advantage of these financing options, the Renaissance Apartments and Townhomes property is also significant because it enabled other community improvements with its connection to the Hopkins Activity Center. Figure 17. Property boundaries for National Register evaluation. (Hennepin County Property Interactive Map) Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 14 The Hopkins Activity Center is associated with broader efforts to revitalize the city. When South Junior High School closed in 1977, there was interest to use the building as a community center. The former school building was considered a landmark in Hopkins. If repurposed, the city hoped its prime location on Mainstreet would improve the downtown area. Although the community backed the idea, the city could not afford to purchase space for the center. Instead city officials intended to use the Community Development Block Grant to fund the project. To receive this federal funding, the city grudgingly supported the Renaissance Apartments and Townhomes. Although officials were not opposed to low- to moderate-income housing, such development is often placed on the outskirts of a community or installed in neighborhoods that already have a high level of low-income residences. City officials in Hopkins might have preferred those alternatives given their tepid support for the school conversion project. Despite the city’s reluctance, the prominent location of the Renaissance Apartments and Townhomes made Hopkins face the issue of poverty head-on. The eventual cooperation between private developers and city officials transformed the former school building into a property that not only benefited residents with low or moderate incomes, but also provided a community fixture for everyone. This innovative solution to the local issue of affordable housing and community development also exemplified the adaptive use of an older building in the early years of the preservation movement. The National Historic Preservation Act passed in 1966, creating the National Register of Historic Places and raising awareness of the significance of historic places across the country. During the same period, the environmental movement spurred a growing interest in recycling resources, including buildings. The recommended period of significance is 1981, the year the project was completed. Because this is within the past fifty years, the property must qualify under National Register Criteria Consideration G, which requires it to be exceptionally important. Criteria Consideration G Exceptional importance is applied to properties whose historical associations are less than fifty years old. Although South Junior High School was constructed in 1925, the property is significantly linked to its conversion to the Renaissance Apartments and Townhomes and the Hopkins Activity Center in 1981. For the property to be exceptionally important, there must be sufficient perspective to understand the qualities and contribution of the property within its historic context. Because redevelopment efforts in the decades after World War II have been the subject of extensive analysis for many years, it is possible to have an objective perspective on key themes related to that context. The Renaissance Apartments and Townhomes and the Hopkins Activity Center appear to be exceptionally important as an early example of the local conversion of a closed school building into subsidized housing units. As the population of the nation’s inner suburbs dropped, many schools closed and were abandoned, demolished, or repurposed for other uses. The declining population was in part a result of inflation in the housing market, which was combated by state and federal initiatives to subsidize the construction of low- to moderate-income housing. Although adaptive reuse projects and affordable housing developments were fairly common during this period, the combination of both trends was rare. The Renaissance Apartments and the Hopkins Activity Center were an innovative solution to both issues. Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 15 To justify exceptional importance, Hess Roise identified other school-to-housing conversion projects in the state of Minnesota (see Table 1 below). Although several schools were repurposed into housing in the 1980s, the Whittier School in South Minneapolis and the Renaissance Apartments and Townhomes were the only two properties to incorporate federally subsidized housing. By enabling the creation of the Hopkins Activity Center, the Renaissance project provided community benefits beyond housing. Also, the Renaissance and Whittier projects offered different models to address affordable housing needs. Whittier was developed as a cooperative that required residents to buy shares and participate in management. The Renaissance Apartments and Townhomes project, on the other hand, exemplified public-private partnerships, which became a more common method of producing affordable housing in subsequent decades. Other school conversions would follow after the federal Low-Income Housing Tax Credit program was implemented in 1986. However, upon its completion in 1981, the Renaissance Apartments was unique in the state of Minnesota and represents a pioneering example of the reuse of a former school building as subsidized rental housing.20 Table 1. Significant School-to-Housing Conversion Projects in Minnesota Property Name SHPO Inventory Number Address NRHP-Listed or Eligible Housing type Date converted into housing Belltower Apartments NL-NMC-005 442 Belgrade Avenue, North Mankato Yes Apartment units ca. 1978 Whittier School HE-MPC-6028 2609 Blaisdell Avenue South, Minneapolis Yes Cooperative apartment units 1980 Renaissance Apartments and Townhomes Not assigned 27 North Fourteenth Avenue, Hopkins Recommended eligible Subsidized apartment units and townhomes 1979-1981 James Madison School (Madison School Apartments) HE-MPC-0398 501 East Fifteenth Street, Minneapolis Yes Subsidized apartment units and townhomes ca. 1983 Fredrika Bremer School HE-MPC-8186 1214 Lowry Avenue North, Minneapolis No Condominiums mid 1980s Integrity The property retains very good integrity. The building remains in its original location and the setting is remarkably unaltered since 1981. Although there have been some modifications to the surrounding area in downtown Hopkins, the overall character of the site is unchanged. The hill, the meandering concrete pathways, and the parking plan remain the same as when the property was originally developed. Similarly, the integrity of design is also strong in the apartment buildings and townhomes. The double-loaded corridor in the apartment building and the configuration of the townhouses are both unaltered. The city updated the Hopkins Activity Center in 1991 to add a glass plate entrance to the exterior, which slightly altered the design and 20 Ingrid Sundstrom, “Co-op Housing Uncommon in Cities; Most Serve Low-income Residents,” Minneapolis Star Tribune, May 23, 1987. Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 16 removed some historic fabric. While there were also several minor updates to the apartment building and townhomes in 2008, the integrity of materials and workmanship throughout the property is good. Some minor modifications occurred in the maintenance area on the northwest wall of the building’s exterior. The townhouse roofs and the apartment building HVAC system were also replaced in 2008. Despite the slight alteration of materials, the feeling and association at the property are especially strong. Although the ownership of the property was transferred to the CHDC in 1996, the Raspberry Ridge Apartments continue to provide affordable housing in Hopkins. Similarly, the Hopkins Activity Center has remained in operation since it opened in 1981. The retention of design features and setting, combined with the retention of the property’s function, allows the building to be clearly associated with its history. Conclusion The property, including the Renaissance Apartments and Townhomes and the Hopkins Activity Center, appears eligible for listing in the National Register under Criterion A in the area of Community Planning and Development for its significant association with affordable housing, community development, and adaptive reuse. The period of significance is 1981, the year that the conversion was completed. While the conversion occurred less than fifty years old, the property also meets Criteria Consideration G for exceptional importance as a pioneering example of a school-to-housing adaptive use project in the Twin Cities. The property retains sufficient integrity to convey is exceptional importance. Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 17 Bibliography Armstrong, Jackie. “Council, School Board Discuss Job Corps Tenancy.” Hopkins Sun, May 27. 1977. ———. “Housing is First Priority, Miller Says.” Hopkins Sun, November 18, 1977. ———. “Job Corps Asks Lease Price on Hopkins South.” Hopkins Sun, May 20, 1977. ———. “Job Corps Tenancy Needs Study: Miller.” Hopkins Sun, June 3, 1977. ———. “Kucera Receives ‘Weighty’ Reminder of South’s Start.” Hopkins Sun, August 24, 1977. ———. “Potential Tenants Eye South Junior High School.” Hopkins Sun, April 20, 1977. ———. “Proposed Job Corps Residence Meets Resistance from Citizens.” Hopkins Sun, June 24, 1977. ———. “Rehabilitation of South Moves Closer to Reality.” Hopkins Sun, April 26, 1978. ———. “South’s Fate May Go to Voters.” Hopkins Sun, August 17, 1977. Blomquist, Clint. “The Rebirth of South Jr. High School.” Hopkins Review, November 26, 1980. Blumenthal, Steven H. “Housing for the Poor Under the Section 8 New Construction Program.” Journal of Urban and Contemporary Law 15 (January 1978): 281-307. Brasil, Margaret M. The Creation of a Federal Partnership: The Role of States in Affordable Housing. Albany: SUNY Press, 2010. “City Can’t Decide, So Builders Sent to School.” Hopkins Sun, August 3, 1977. “City Gets First Okay on Federal Fund Bid.” Hopkins Sun, August 2, 1978. City of Hopkins. “Capital Improvement Program: 1988-1992,” January 1988. At Hopkins Historical Society. Committee on Housing and Urban Development. “Development of State Housing Finance Agencies.” Real Property, Probate and Trust Journal 9 (Winter 1974): 471-491. “Council Approves Loan for South Junior High.” Hopkins Sun, June 13, 1979. Delvac, William F., Susan M Escherich, and Bridget Hartman. Affordable Housing Through Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 18 Historic Preservation: A Case Study Guide to Combining the Tax Credits. Collinsville: DIANE Publishing, 1995. Dickinson, Ernest. “Surplus Schools the White Elephant of Suburbia.” New York Times, October 12, 1975. Ewing, Beverly O., ed. Hopkins, Minnesota Through the Years. Hopkins: Hopkins Historical Society, 2002. Fitzsimmons, James D., Julia A. Nutter, and Kathleen A. Gilder. Housing Rehabilitation Loan Programs in Minnesota. Minneapolis: Center for Urban and Regional Affairs, University of Minnesota, 1975. Gohl, Janey. “South Junior High School Building Keeps Original Facade, Gets New Life.” Hopkins Sun, February 14, 1979. Harwood, Markie. “Athletics, Faculty Head List of Budget Cutbacks.” Hopkins Sun, January 9, 1977. ———. “Five-Page Document Symbol of Depth of School Crisis.” Hopkins Sun, January 19, 1977. ———. “It’s Official: 88 Teachers Leaving.” Hopkins Sun, March 11, 1977. ———. “Subsidized Rent Plan Approved in Hopkins.” Hopkins Sun, February 18. 1977. Haworth, Edward E. “Title I of the 1974 Housing and Community Development Act and Its Impact on Local Communities.” Land Use Planning Symposium 2 (May 15, 1975): S143- S158. “‘High’ Living Possible for Old South School.” Hopkins Sun, October 18, 1978. Hopkins Centennial Committee. Hopkins Centennial Album, 1887-1987. Hopkins: Hopkins Centennial Committee, 1987. “Hopkins Merchants Not Opposed to Job Corps.” Hopkins Sun, July 27, 1977. Hopkins Renaissance Associates. “Limited Partnership Agreement and Certificate of Limited Partnership,” ca. 1978. “Hopkins School Now Holds 65 ‘Renaissance’ Units.” Minneapolis Star Tribune, November 14, 1981. “HUD Says Grant Must Aid City’s Low-Income Citizens.” Hopkins Sun, December 7, 1977. Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 19 Illinois Housing Development Authority. “A Proposal to the Ford Foundation to Fund a Technical Assistance Corporation for Housing in Illinois,” May 21, 1969. “Junior High Built in 1925; Originally Housed All Grades.” Hopkins Review, November 7, 1957. Landsverk, Gabby. “Hopkins Community Remembers Jerre Miller.” Sun Sailor, February 20, 2017. Lassiter, Tim. “HUD Rep Pulls the Plug on Swimming Pool Plan.” Hopkins Sun, November 23, 1977. McCarty, Maggie, Libby Perl, and Katie Jones. “Overview of Federal Housing Assistance Programs and Policy.” Prepared by Congressional Research Service for Me mbers and Committees of Congress, 2010. Mertens, Mark E. “Where Have All the Robins Gone? Power, Discourse, and the Closing of Robbinsdale High School.” PhD diss., University of Saint Thomas, 2013. Miller, Patty. “South’s Future Use Is Still Undecided.” Hopkins Sun, December 2, 1977. Minnesota Housing Finance Agency. “Minnesota Housing Needs, Housing Resources, and Housing Resource Distribution Plans.” Prepared for the Minnesota State Planning Agency, Office of Local and Urban Affairs, 1976. At Minnesota Historical Society, Saint Paul. National Park Service. National Register Bulletin 15: How to Apply the National Register Criteria for Evaluation, rev. 1997. “New Development Continues in Hopkins.” Hopkins Sun, March 21, 1979. “Plan for South Junior High Site Progresses.” Hopkins Sun, November 15, 1978. “Public Hearing on South Disposition.” Hopkins Sun, June 17, 1977. Reinan, John. “Streetscapes: Mainstreet in Hopkins Is to Be Admired – Not for Form, But for Function.” Star Tribune, July 17, 2015. “Renaissance Apartments and Townhomes.” Informational Brochure, ca. 1980. “Renters May Apply at Renovated South.” Hopkins Sun, April 23, 1980. “School-Aid Showdown Is Expected.” Hopkins Sun, January 16, 1977. “School Board to Sell South.” Hopkins Sun, December 21, 1977. Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 20 “South Conversion Evaluated.” Hopkins Sun, March 28, 1979. “South Junior High to be Closed: Next Decision Junior High Boundaries.” News and Views: 274 Hopkins Independent School District Newsletter 14 (May 1976). “Standard Form of Agreement Between Community Housing and Development Corporation and Flannery Construction, Inc.,” June 9, 2008. “Statement of Governor Wendell Anderson on Major Housing Rehabilitation Program He Will Submit to the 1974 Minnesota Legislature,” November 1973. Sundstrom, Ingrid. “Co-op Housing Uncommon in Cities; Most Serve Low-income Residents.” Minneapolis Star Tribune, May 23, 1987. Surplus School Conversation Act of 1974, HR 12947, 94th Cong. (1976). Sutton, Stacey A. “Urban Revitalization in the United States: Policies and Practice.” United States Urban Revitalization Research Project, June 25, 2008. Teaford, John C. “Urban Renewal and Its Aftermath.” Housing Policy Debate 11 (2000): 443- 465. “Tenant/s [sic]Wanted: Building Available – July 1, 1977.” Hopkins Independent School District Newsletter 15 (May 1977). “These Are Your Schools: Junior High Built in 1925 Originally Housed All Grades.” Hopkins Sun, November 7, 1957. “Unpredictably, Hopkins Grew.” Hopkins Sun, February 20, 1980. “Urban Renewal Projects Given High ’78 Priority by Officials.” Hopkins Sun, December 30, 1977. U.S. Department of Housing and Urban Development. “Neighborhood Conservation and Property Rehabilitation: A Bibliography,” October 1979. ———. “New Directions in the CDBG Program.” In Community Development Block Grant Program, Third Annual Report, 20-29. Washington D.C.: U.S. Government Printing Office, March 1978. Vick, Patrick. “Cutting Back is ‘New’ for Schools.” Hopkins Sun, January 16, 1977. “Walls Start Coming Down at South Junior High.” Hopkins Sun, October 24, 1979. Warden, James. “Why Does Hopkins School District Cover So Many Cities?” Minnesota Patch, Evaluation of National Register Eligibility: The Renaissance Apartments and Townhomes and the Hopkins Activity Center – Page 21 December 18, 2012. White, Patricia Paulson. “Empty Corridors: The Legal Aspects of the Closure and Sale of Surplus Public Schools.” Santa Clara Law Review 16 (January 1976): 595-606. Young, E. J. “Rental Costs for South Junior High.” February 11, 1977. At Hopkins Historical Society. ———. “South Junior High Expenditures.” September 7, 1976. At Hopkins Historical Society. Zellie, Carole. “Minneapolis Public Schools Historic Context Study.” Prepared by Landscape Research LLC for the Minneapolis Heritage Preservation Commission, April 2005. Community Housing Development Corporation 612-332-6264 Fax 612-332-2627 614 North First Street • Suite 100 • Minneapolis, Minnesota 55401 DATE: January 9, 2020 TO: City Council and Staff FROM: Community Housing Development Corporation (“CHDC”) RE: Adding the Activity Center to the National Register of Historic Places REQUEST Approve adding the Hopkins Activity Center and Raspberry Ridge Apartments and Townhomes to the National Register of Historic Places conditioned upon city staff’s review and approval of CHDC’s application. SITUATION In fall 2020, Community Housing Development Corporation (“CHDC”) intends to re-finance and renovate Raspberry Ridge without city financial assistance. To this end, CHDC is pursuing historic tax credits. Its historic consultant, Hesse Roise, conducted a feasibility analysis (attached) and found that the entire property—the Activity Center and Raspberry Ridge—has historic significance, not the apartments portion alone. For Raspberry Ridge to receive historic credits, the entire site needs to be on the National Register. ISSUES TO CONSIDER • The anticipated steps and timeline to get National Register designation. CHDC requests the city’s blessing to begin the application. National Register designation follows a two-step process—State Historic Review Board approval and then National Park Service approval. Our historic consultant would begin putting the application together now and submit it in the spring for the August state review board meeting. • What getting on the Register would mean for the Activity Center. How it would affect the city’s ability to renovate and maintain its property in the future. The National Register is mostly honorary. It has little effect on what an owner can to do to a property unless federal or state bond funding is used or a federal license (like a Corps permit) is required. In that event, it is subject to a Section 106 (federal) or Chapter 138 (state) review process. If the city did something to the Activity Center that compromised its historic integrity, the State Historical Preservation Office (“SHPO”) and National Park Service’s recourse would be to “delist” the entire property. If that happened during the Raspberry Ridge renovation project or the five-year historic credit recapture period, the IRS would recapture Raspberry Ridge’s historic tax credits. The historic tax credit investor will likely need assurance that the city won’t compromise the historic integrity during the five-year recapture period. CHDC anticipates the assurance would be an agreement, MOU or letter where the city commits to maintaining historical integrity. CHDC understands more information would be needed before the city would consider providing such an assurance but wanted to flag the issue now because it will likely come up as CHDC’s transaction moves forward. • Activities and actions that could compromise the historic integrity. Examples of things the city could and could not do during the five-and-a-half-year period. Changing its use from a community center for the public would be problematic. In general, interior renovations would be fine. The exterior would be more of an issue, and changes facing the public right-of-way would be more sensitive than those not visible from street. Changing the roofline—like adding another story or a big roof deck and penthouse—would be problematic. The newer entryway could be modified, especially if the design was more in keeping with the 1970s design (it could be nice-looking – lots of alternatives could work). Changing out the windows and adjacent siding could be done but probably not a radical transformation of the existing design especially on the street side. Landscape features tend to come and go as trees and plants go through life cycles. • Would the city have to do renovations on the Activity Center if CHDC get historic credits for the Raspberry Ridge apartments? No • Assuming CHDC would pay all the historic designation and credit related costs, are there any ongoing tax implications or other costs to the Activity Center or city? No • Other funding sources would become available with National Register designation. The designation often helps raise funds and groups have successfully used the designation as part of a fundraising strategy. Properties listed in the National Register can qualify for grants from the state’s Legacy Fund. There are the small grants ($10,000) and the large ones ($200,000). There are also occasionally funds available through the National Park Service. FURTHER INFORMATION • How did the Activity Center come to be with Raspberry Ridge? From Hesse Roise’s feasibility analysis: “The Hopkins Activity Center is associated with broader efforts to revitalize the city. When South Junior High School closed in 1977, there was interest to use the building as a community center; although, the city could not afford to purchase space for the center at the time. City officials unlocked community development block grant funding for the Activity Center project by supporting the Raspberry Ridge apartments and townhome development. The cooperation between private developers and city officials transformed the former school building into a property that not only benefited residents with low or moderate incomes but also provided a community center for the public.” • Why it would be difficult for the city to utilize historic credits for the Activity Center. Tax exempt owners cannot receive tax credits per IRS Code. At a minimum, the city would have to create a taxable partnership/owner where a for-profit limited partner used the credits. To utilize the credits along with Raspberry Ridge, CHDC’s new taxable owner/partnership would have to acquire and own the Activity Center and add the city as a general partner, etc. To give city leaders a sense of the numbers for historic credit equity proceeds, if the Activity Center did $1MM in renovation and corresponding soft costs, it would receive roughly $200,000 in historic credit equity proceeds. • Would the Activity Center’s eligibility for credits or its potential credit amount be diminished by Raspberry Ridge’s actions? No, not unless Raspberry Ridge caused the property to be delisted, which would not be in its interest to do. CHDC’s historic consultant, Charlene Roise from Hesse Roise, is available if you have any further questions about what getting on the National Register means for a property owner. EAST ELEVATIONSCALE: 1" = 20'-0" Hopkins, MN 01-08-20 HOPKINS VILLAGE II EAST ELEVATIONSCALE: 1" = 20'-0" Hopkins, MN 01-08-20 HOPKINS VILLAGE II NORTH ELEVATION WITH TOWERSCALE: 1" = 20'-0" Hopkins, MN 01-08-20 HOPKINS VILLAGE II EAST ELEVATION WITH TOWERSCALE: 1" = 20'-0" Hopkins, MN 01-08-20 HOPKINS VILLAGE II