Many tools to update Heights aging housing stock

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Columbia Heights is attacking its aging housing stock from two fronts. Recently, city development staff unveiled a 10-year housing maintenance plan that includes new and continuing programs, partnerships and money for home improvement or new construction.

Meanwhile, the fire department has been working on updating the city’s 19-year old Housing Maintenance Code to include commercial as well as residential property. The department will present the new code to the Columbia Heights City Council for approval Oct. 22.

Community Development Director Robert Streetar said the city’s Economic Development Authority (comprised of city council members, Tami Diehm, Bruce Kelzenberg, Robert Williams, Bruce Nawrocki; Mayor Gary Peterson; and residents, Marlaine Szurek and Pat Jindra) voted—with Nawrocki casting the sole dissenting vote-—to approve a multi-phased Housing Maintenance Plan for 2008 through 2017. The EDA is the city’s redevelopment arm; it used to be known as the HRA, Housing Redevelopment Authority.

“This plan is focused on maintaining our housing stock, particularly owner-occupied stock, which is 70 percent of all the housing stock in the city and 80 percent of all the market value in the city. This is a big, important piece of our tax base and neighborhood livability,” Streetar said. “The city has never had any sort of housing plan in the past. It has not been a real high priority.”

In Streetar’s Aug. 18, 2007, report to EDA commissioners, he wrote, “The residential homestead housing stock is much older and lower in value compared to other metropolitan cities. Residents have identified deferred maintenance of the housing stock as a problem since 1992.”

HRC program
The housing maintenance plan includes continuing the city’s relationship with the Housing Resource Center (HRC), a GMHC (Greater Metropolitan Housing Corporation) program that provides homeowners with free information and services, including home improvement loans, construction management and advice on many housing topics.

“This program helps people who don’t have a lot of remodeling experience get information on things like roof replacement and home rehab,” Streetar said. The City of Columbia Heights (through EDA) will pay GMHC $16,800 a year for 10 years, city staff estimates that 4,500 homeowners might take advantage of the service. The agreement has been in effect since 2002; 1,819 Heights homeowners have already used HRC.

Incentive program
Another GMHC program, the Home Rehabilitation Incentive Program, offers cash rebates to residents who upgrade and maintain their homes. There is a household income requirement, which nearly everyone living in Columbia Heights meets, he added. “Your household income has to be below $88,206, and the rebates are either 10, 12, or 15 percent of the work (up to $3,000), depending on income.

“If you qualify for the program and put a $4,000 roof on your house, you bring in the bill and get a rebate back that could be from $400 to $600. You can do as many projects as you want,” Streetar said.

The EDA will continue to fund this program, which has also been in effect since 2002, at $50,000 a year. Streetar said 62 homeowners have received rebates, which averaged $1,270 and resulted in $773,899 worth of rehabilitation.

Deferred loan program
A new GMHC program, the Single Family Home Deferred Loan Program, is targeted at seniors “with incomes so low they can’t go to their bank and get a loan.” GMHC will provide a loan for renovation work—which might include new roofs, windows, heating and air conditioning systems, plumbing and electrical work—but repayment acts like a lien. It isn’t repaid until the homeowner sells or there is a title change.

“The loan is repaid out of the equity in the home,” Streetar said, adding that the EDA has not yet approved the actual terms of the deferred loan program.

“This gives the homeowner a way to stay in their home. You’re trying to get to the people who are not investing in their homes, either because they can’t afford to or don’t want to. This will likely serve between 20 and 30 homes, and will cost the EDA about $30,000,” he said.

Replacement program
A fourth program tackles the most blighted and dilapidated single family homes. Called the Single Family Home Replacement Program, it too has been in effect since 2002 with GMHC. “This was set up for the 500-square foot, one-bedroom, one-bathroom house with no garage. These tend to be in tough shape. The city’s goal, working with GMHC, is to buy those homes at market rate prices, not using eminent domain, tear them down and replace them.” In the last five years, the city has been able to replace five houses with 10 new ones with an average sale price of $232,000, Streetar said.

One such project underway is at 4141 Jefferson, where, after a house fire, the property sat vacant for two years. “The person who lived across the street from that house was trying to sell theirs for two years, without success. The EDA paid $86,000 for it, and GMHC is building two new 1,600-square foot single family homes that will sell for about $230,000 each.”

The Metropolitan Council and Minnesota Housing Finance Agency also contributed money to the Single Family Home Replacement Program. Streetar said that program costs EDA $50,000 every other year. “We have to go to the state to levy state grant money.” He said he estimates that the city will be able to replace 20 to 40 houses in the next 10 years under this program.

He said the money that EDA is using for the above programs will come out of federal Community Development Block Grant (CDBG) funds.

Maintenance fund
A fifth program, the Housing Maintenance Capacity Building Program, is a housing rebuilding plan using tax increment money and special project bond fees.

The Housing Maintenance Capacity Building Program is funded through an annual EDA levy; its purpose is to ensure that housing renovation efforts, once begun, can continue. The money will be reserved for housing maintenance programs starting after 2017; according to Streetar, it will create a fund of more than $450,000 of “housing maintenance financial capacity.”

He said the cost to homeowners (on a $200,000 house) for the five programs—which is a $1,600,000 investment in housing over 10 years—will be about $66 a year.

“This is a proactive plan,” Streetar said. “We’ve been living with the consequences of short-term thinking. Being fiscally responsible is a two-sided equation; you can’t just worry about spending, you have to worry about the value. We need to get outcomes.”

Maintenance code
Columbia Heights Fire Chief Gary Gorman said that department staff recently updated the old maintenance code, after discovering that the old one was too vague and didn’t address some of the city’s current problems.

Some of the changes for residential rental properties include more specifics about maintaining properties, especially the exteriors. It limits occupancy of rental units to two people per bedroom; the old code allowed two people “per habitable room.”

The heat required in units can be lower under the new code; it used to be 70 degrees minimum, now it is 68. Leases must include a “Crime Free/Drug Free and Disorderly Use” clause. Building owners who have had two or more rental licenses revoked will be ineligible to apply for another license for five years.

For non-residential properties, including commercial, industrial, and educational property, the new code will require that they be licensed, similar to residential rental property. Property maintenance standards will be enforced, which is an upgrade from the old code, which required enforcement of only the State Fire Code and a few sections of the city code.

The first reading of this proposed ordinance is scheduled for Oct. 22, in the city council chambers, 7 p.m. For questions on the new ordinance, call the fire department at 763-706-3650.

The city’s website is www.ci.columbia_heights.mn.us. The city’s phone number is 763-706-3600.