Editor's Note: The following is a letter sent by Richfield resident Bob Olson to Richfield city staff, council members and local media editors. The Pillsbury Commons development project has become a great controversy among neighbors, who have a wide variety of concerns. Many letters have been written to city staff and council members. The following is an example of those those letters, sent to staff and editors Monday.
Dear Mayor Goettel, Richfield City Council and Richfield Commission Members:
Since the has arisen I have become increasingly concerned with what seems to be a rush by our city to comply with the Affordable Housing Need Allocation developed by the Metropolitan Council as part of the “Summary Report: Determining Affordable Housing Need in the Twin Cities 2011-2020.” I have spent some time studying this report and would like to relate some items that are relevant to this issue, especially since I now understand that another redevelopment plan.
The summary report specifically points out that it ignores the “filtering” process whereby older living units depreciate in price to maintain occupancy. The report indicates that, in 2006 using HUD data, 29% of Richfield living units were considered within the affordable range. I believe the study that the city has authorized Stantec to perform is intended, at least in part, to update and confirm or modify this figure. A review of Stantec’s proposal appears to indicate that the “filtering “process will also be addressed. I believe that this is a critical element to be used to inform future housing decisions.
The summary report acknowledges that this price “filtering movement between market-rate and affordable pricing does not generally occur among subsidized units, which generally are never ‘priced up’ into the market-rate category.” But, with 30-year income and rent controls required by the MnHFA, how could it occur?
We must recognize that this “filtering” process will bring pressures to bear upon a development with 100% of the units having restrictions on income levels and controls on rental rates. As these units age over their 30 year “life span”, and as the demand for these ageing units decreases, what can we expect to be the result? Since the owner is unable to lower the rental rate will vacancies increase eliminating rental revenue entirely or will the management company find that their only choice to maintain cash flow is to accept applicants with incomes at levels requiring rental expenditures at half, or nearly half, of their income? I do not believe that this would leave a tenant with funds adequate to buy food and other necessities. Either scenario will be detrimental to the city.
The summary report also states that the recommendations are limited to “newly constructed affordable housing, a development that consumes land” (emphasis by report author). I tried to digest this statement and considered the land area of Richfield compared to the land area of our Edina and Bloomington neighbors. I have a very difficult time envisioning vacant land within Richfield’s present borders that will allow a significant volume of new construction. Why Richfield is expected to provide 360% of the units required of Edina and 120% of the units required of Bloomington, suburbs approximately twice and four times our size respectively with equivalent transit service?
The report says that the housing need allocation does not include living units lost to demolition or gentrification thus Richfield must replace each unit lost, for what-ever reason, just to maintain the status quo. Are we then expected to create “consumable land” by demolishing our existing “aged and depreciated, former market rate, affordable housing,” to make room for newly constructed affordable housing units and aged unit replacement thus satisfying the need allocation? Could this really be the desire of the Met Council? It would seem much more cost effective to take the steps necessary to maintain and monitor these existing affordable living units and, when economics allow, build mixed income (80% market, 20% affordable) apartments, condominiums or townhomes that do not present the potential downside of a 100% affordable development and will contribute to the gentrification of Richfield. Let’s try to minimize the rent control phase of the typical housing cycle.
The Met Council apparently assigns an anticipated net growth figure to each community in the metro area and required housing unit needs are based upon this figure. Bloomington (four times our size) anticipates a net growth of 1500 units, exactly the same as Richfield, and Edina, (twice our size) anticipates only 212 units, ¼ of our projected net growth. It is also curious to note that both Edina and Bloomington, each having approximately 20% of their housing stock now considered affordable, are asked to increase their stock by less than 1% while Richfield, with 29% affordable stock is asked for an increase of almost 2%. What is the rationale and when does it stop? Is it proportional, the more you have the more you must have? How or why does Richfield accept these rather obvious discrepancies?
Ron Clark Construction, in his letter dated Jan 18, 2012, references a 2011 market study by Joe Urban which indicated a need in Richfield for workforce housing by a two to one ratio, jobs over housing, Mr. Clark states, “This means there are 2 people who work in Richfield competing for every affordable housing unit in Richfield.” Initially I accepted this statement but, after a careful reading of the report, I believe this statement to be extremely misleading and totally inaccurate.
The summary report stated that the job proximity ration is: “a comparison of local low-wage jobs (within ten miles of the community’s geographic center-point) divided by local working residents (living within 10 miles of the center-point).” Therefore, the ratio of “local jobs to local residents” is not limited only to conditions within the borders of Richfield but to “local” conditions extending throughout a 20 mile diameter circle using Richfield as its center-point. For this statistic to be used as justification for requiring Richfield to build workforce housing, in quantities and ratios far exceeding that requested by the Met Council for adjacent suburbs located wholly within the same job proximity area, is entirely inappropriate. Please note that this area includes almost all of Minneapolis, the area of St. Paul located west of downtown, all of Edina, Hopkins, Bloomington, Eagan, St Louis Park, Golden Valley, Mendota Heights, Sunfish Lake, Falcon Heights, most of Apple Valley, Burnsville, West St Paul, Savage, Eden Prairie, Minnetonka, and parts of St. Anthony and Robbinsdale.
I ask your consideration of the issues raised in this letter. Your thoughts and comments would be appreciated.
I believe that approval of any zoning modifications, TIF financing requests, property sales, or any action taken to further the development of the Lyndale Garden Center project, the Pillsbury Commons project or any project with a 100% affordable housing component is inadvisable and, in the end will be detrimental to the city. It is imperative, in my opinion, that the Stantec report be received and thoroughly analyzed before issues related to these projects are included on any council or commission meeting agenda.
Robert O. Olson
7442 Pillsbury Ave. S.