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Inclusionary Zoning Policy Development

Background

On February 9, 2018, Council President Bender introduced subject matter to establish an inclusionary zoning (housing) ordinance. Inclusionary housing intends to advance the goals of the City’s housing policies by requiring that affordable housing units are provided in new residential or mixed-use developments. Cities in the Twin Cities region with inclusionary housing policies include Edina (2015), Golden Valley (2017), Brooklyn Park (2017), St. Louis Park (updated 2018), and Bloomington (2019).

Since 2003, the City of Minneapolis has implemented housing policy that requires affordable housing units in residential and mixed-use projects with 10 or more units that receive financial assistance from the City. The policy was expanded to apply affordable housing requirements to projects receiving pass-through funding from the City (state or federal funds), and projects developed on property or a portion of property owned by the City.

In 2017, the City engaged a consultant, Grounded Solutions Network (GSN), to conduct financial feasibility analysis and policy research about national best practices to inform recommendations for inclusionary housing policy options for the City. Their report included pros and cons of different policy choices, and case studies from inclusionary housing policies in Washington DC, Chicago and Seattle. The report included research and data from a policy brief called Inclusionary Housing Prevalence, Impact and Practices. This policy brief noted that at the end of 2016, 886 jurisdictions had inclusionary housing programs in 25 states and the District of Columbia. An inter-department team of City staff from Community Planning and Economic Development (CPED) Housing, Development Services, and Long-Range Planning divisions, City Attorney’s Office and the Finance and Property Services department supported this work. Grounded Solutions Network also received feedback from private developers and affordable housing advocates in this process.

GSN presented the report to the Housing Policy & Development Committee of the City Council on August 22, 2018. The report informed an inclusionary housing policy framework adopted by the City Council on December 7, 2018, along with the Minneapolis 2040 Comprehensive Plan The City Council directed staff to develop a comprehensive inclusionary housing policy consistent with this framework in 2019.

Also on December 7, 2018, the City Council approved amendments to the Unified Housing Policy and the Minneapolis Zoning Code to allow for an “Interim” inclusionary zoning ordinance and inclusionary housing policy, to be in place from January 1, 2019 until a new comprehensive policy takes effect. This interim ordinance only applies to development projects that need re-zoning and/or substantial additional development capacity of 60% or more. The interim ordinance exempts ownership housing projects and housing developments primarily targeted to students. The ordinance language defines projects subject to the affordable housing requirements. The Unified Housing Policy defines the specific affordable housing requirements. 

In 2019, the City approved an Interim Inclusionary Zoning Tax Increment Financing Policy for Revenue Loss Offset to support the inclusionary housing policy. This financial assistance policy supports qualifying projects subject to the City’s Interim Inclusionary Zoning Ordinance by ensuring the project remains financially feasible to develop.

Comprehensive Inclusionary Zoning Policy Development

In early 2019, the City conducted a request for proposals (RFP) and again Grounded Solutions Network to help develop a comprehensive inclusionary zoning policy and implementation program consistent with the adopted framework. This work is underway, supported by the inter-departmental staff team and involving stakeholder engagement, interviews, research and technical assistance.

Proposed timeline for comprehensive inclusionary zoning ordinance and policy approval:

July 17, 2019: Housing Policy & Development Committee receives and files presentation and public comment on compliance alternatives to inclusionary housing policies (2019-00822)

October 16, 2019: Housing Policy & Development Committee considers draft policy recommendations

November 18, 2019: Planning Commission holds public hearing on Inclusionary Zoning Ordinance

December 4, 2019: Housing Policy & Development Committee considers approval of amendments to the Unified Housing Policy to incorporate affordability requirements for projects subject to the Inclusionary Zoning Ordinance

December 5, 2019: Zoning & Planning Committee considers approval of Inclusionary Zoning Ordinance

December 13, 2019: City Council considers adoption of Inclusionary Zoning Ordinance and Policy.   

Past Meetings
Supporting Materials and Documentation

Last updated Aug 20, 2019

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