With more than $14.7 million in tax-increment financing provided for the construction of affordable housing in the city since 1999, efforts have been ongoing for decades.
“We’ve been doing housing projects back to the mid-80s,” Rochester Assistant City Administrator Gary Neumann told the city council this week.
In addition to TIF funding for single-family homes and housing developments, Rochester has provided housing revenue bonds, land and building donations and a home rehab program, among other projects aimed at improving access to affordable housing.
Yet, the city continues to face a housing crisis.
With average rental prices topping $950 a month, the Greater Minnesota Housing Fund reports more than 58 percent of the county’s residents fall below the $38,280 household salary needed to make the average unit affordable. At the same time, affordable workforce housing had a vacancy rate of 1.3 percent at the end of 2013, meaning many families have no choice but to pay rents their incomes cannot support.
Fortunately, more affordable housing is being built this year. City staff estimates TIF funding and housing revenue bonds will support the creation of about 430 new affordable workforce and senior housing units in 2016.
Unfortunately, current housing efforts likely will be outpaced by demand. Expected population growth indicates a need to add or renovate 913 similar units each year through 2020.
The $1.35 million generated by the Olmsted County Housing Redevelopment Authority levy will help, but it cannot stand alone as the only change. John Errigo of the Greater Minnesota Housing Fund, said the added county-based revenue will only provide about 10 percent of estimated need without added effort. “In 10 years, you’ll finish the first year’s worth of demand,” he told the city council.