Agenda - Planning Commission - 09/04/2014

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Last revised July 24, 2014 Living in areas of concentrated poverty hurts people in many ways. Areas of concentrated poverty usually suffer from high crime and tend to have schools with lower test scores and graduation rates. Living in areas of concentrated poverty can undermine physical and mental health. It reduces the cognitive abilities of children, making them more likely to struggle in school and have lower incomes as adults than their parents. Together these characteristics lower the economic mobility of residents who live in areas of concentrated poverty, making them more likely to stay poor across generations. Barriers that limit residential choices —such as racial discrimination and a lack of affordable housing in a variety of locations —hinder the ability of residents to move out of areas of concentrated poverty and contribute to the creation of Racially Concentrated Areas of Poverty (RCAPs), defined as census tracts where 40% or more of the households earn incomes that are less than 185% of the federal poverty level and 50% or more of the residents are people of color. In 1990, all of the region's RCAPs were in Minneapolis and Saint Paul. By the end of the 2000s, these RCAPs remained and expanded into Brooklyn Center, Brooklyn Park, Richfield, and the federal lands constituting Fort Snelling. Since 1990, the share of the region's residents living in RCAPs rose from 3% to 9%. Blacks and Native Americans —historically the groups experiencing the region's worst discrimination —face the highest hurdles to leaving these areas of concentrated poverty. Inadequate financial resources to address housing challenges The funding available for existing housing programs is inadequate to fully address the region's housing challenges. Future budget estimates for the US Department of Housing and Urban Development (HUD) paint a bleak picture. Federal funding for core HUD housing programs such as Section 8, the HOME Investment Partnerships Program, the Community Development Block Grant (CDBG), and the Public Housing Program is waning. Although the Minnesota Legislature has tried to soften the loss of federal funding, the need for housing resources continues to grow. Moreover, the Low Income Housing Tax Credit Program (LIHTC)—the primary funding source nationwide for new construction and rehabilitation of affordable multifamily housing —is a target for reform that could seriously diminish its reach and impact. $70 $60 $50 $40 $30 $20 $10 $0 Budget for the U.S. Department of Housing and Urban Development (in billions) O - N 00 ▪ Lf) CO I-. co O) O N 00 ▪ Lf) CO N• 00 0) O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O N N N N N N N N N N N N N N N N N N N N Actual Estimated The Metropolitan Council projected that the region should add 51,000 new units of affordable housing between 2011 and 2020 to accommodate the forecasted growth in low- and moderate -income 2040 HOUSING POLICY PLAN I METROPOLITAN COUNCIL DRAFT RELEASED FOR PUBLIC COMMENT Part I: Introduction I Page 10