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�n��' �� K�of��|�� nff��/�|��c�'��nf��nr��|� Appendix �/' Methodology �� / \/ �// the Allocation �// Affordable rr~'' ' ~ ~ ~�n� ~ ~~ ~'' ~ ~ ��[lUs'ng Need r� Housing Definitions and Concepts The following definitions and concepts are important for understanding the methodology behind the Allocation of Affordable Housing Need in the Twin Cities region between 2021 and2030. • Low -Income Household: |nthis process, ahouaeho|d is considered "low income" if its annual income ia8t0rbelow 80960fthe Area Median Income (AM Ufor the 13-00unty Minneapolis -St. Paul -Bloomington metropolitan statistical area, as determined by the U.S. Department of Housing and Urban Development. Approximately 39.5% of the region's households are "low inoonne''under this definition., • Household Growth: The methodology relies on Metropolitan Council forecasts of growth in sewer -serviced households between 2020 and 2030. A given community's growth in sewer -serviced households could be different from its growth in all households if some households inthe community are not connected t0regional 0[municipal sewers. Exhibit 1 provides a map of forecasted net household growth for sewered communities. p Existing Affordable Housing Stock: The methodology increases the Need allocation for communities with a lower share of existing affordable housing than the average sewered community and decreases the Need allocation for communities with a higher share than that average. We then estimate the share of a community's housing units that are affordable to households with income at or below 30% of AMI, between 31 % and 50% of AM|'and between 5196and 8096ofAM|--ino|udingownership houaing,2rental houaing,« and manufactured homes.'These estimates cover all housing units, whether they are publicly subsidized 0[unaubeidized. Exhibit provides 8 map 0fexisting 8ff0[d8b|e housing shares for aevveredcommunities. p Balance of Low -Wage Jobs and Workers: The methodology increases the Need allocation for communities that are relatively large importers of workers in low -wage jobs and decreases the Need allocation for communities that are relatively large exporters of workers in low -wage jobs. We estimate this for each community by examining the ratio of low -wage jobs to residents who work in low -wage jobs for all areas within five nni|ea of the community's geographic center.' Using this five -mile radius rather than jurisdictional boundarieaba|anoeatheneedtohaveareaaonab|y"|ooa|''nneaaurevviththefaotthat labor markets C[0ae jurisdictional boundaries. Exhibit provides nn8p of low -wage job/ worker balance for aevveredcommunities. Specific Steps iDthe Methodology The allocation process has three main steps, shown below in Figure B-1 - In Part 1, we forecast the proportion of 2021-2030 net household growth that will require additional affordable housing, resulting in a regional Need of37,900 new affordable housing unite. In Part 2,vveallocate that regional Need t0each community inthe region with sewer service, HOUSING POLICY PLAN Appendices 149