Affordable housing and the mayor's race

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October 10, 2005 // UPDATED 1:58 pm - April 26, 2007
By: Scott Russell
Scott Russell

McLaughlin and Rybak differences spark debate

R.T. Rybak and Peter McLaughlin are both DFLers, say they support affordable housing and can point to accomplishments to back it up.

Paul Williams, senior program director for Local Initiatives Support Group (LISC), a source of money and technical support for affordable housing, said, “both of these guys have been really strong advocates for affordable housing in very tough economic times.”

If affordable housing is your big issue, how do you choose whom to support?

There are differences — some in style, some in substance.

One of the more substantial: building heights, a hot issue after condo-tower controversies in downtown and Southwest. A McLaughlin idea: height bonuses in return for affordable units — taller buildings for housing poorer Minneapolitans can afford.

Rybak defends the zoning code and says the city has room to grow without giving numerous height variances.

Rybak questions McLaughlin taking campaign cash from developers, which the mayor said would compromise his opponent’s judgment about developments. McLaughlin fires back that the mayor is too preoccupied with the “symbolism” of accepting campaign cash and has failed to help developers who want to invest in the city; McLaughlin said he would be more “hands-on.”

What the candidates tout

Rybak said his accomplishments since taking office inclue creating the Affordable Housing Trust Fund in 2003. An expansion of a former multifamily rental housing program, the Trust Fund has received between $10 million and $20.9 million a year since 2003 and has a proposed $10 million 2006 budget. Rybak said under his tenure, the city has tripled affordable housing spending.

Rybak said the city has helped build or

rehabilitate 1,924 units affordable to people making $11 an hour (30 percent of metro-area median income, or MMI.) The city is on track to meet its three-year target of adding 2,100 affordable units.

McLaughlin said he has worked on affordable housing issues since 1977, when a group he chaired helped convert the old Whittier School into 45 units of Section 8 housing.

He has pushed county spending on affordable housing and housing with supportive services, he said. For example, he took the lead with the community with creating Anishnabe Waikiagun at 1400 Franklin Ave. E., housing for chronically homeless inebriates.

Jim Graham, planning director for the American Indian Community Development Corp., a former Rybak backer, said McLaughlin personally helped jumpstart a state land transfer at Franklin & Hiawatha for a 60-unit housing project targeted to minimum wage workers. The proposal had languished in the city bureaucracy, he said.

“Peter McLaughlin makes things happen,” Graham said.

County Commissioner Gail Dorfman, who has taken the lead on county involvement in affordable housing, backs Rybak. The Affordable Housing Trust Fund had helped as developers try to assemble funds from city, county and state sources.

“The city under R.T. has been there at the table,” she said. “He has been supporting them every step of the way.”

A housing vision

The Metropolitan Council forecasts that the Twin Cities will grow by 966,000 people, or 36.5 percent, between 2000 and 2030. McLaughlin criticizes Rybak for failing to deliver a housing vision.

“They don’t have a plan that in any serious way positions the city in relation to the 1 million new people who are coming,” he said.

What is Rybak’s vision?

“Minneapolis at its peak had 500,000 people,” he said. “Today it has 350,000. We have room for more, if we are smart about it. I talk about rebuilding the streetcar city, where housing is concentrated along transit corridors, so every few blocks there is a corner store, some housing above it, with single-family neighborhoods behind it.”

Rybak said specific next-term housing

goals include:

- Encouraging partnerships with faith communities with aging congregations. He pointed to Minneapolis Catholic Eldercare, which has senior housing built on land adjacent to St. Hedwig’s Church in Northeast, as a model.

- Looking for funding partners to promote homebuying programs for first-time homebuyers and communities of color.

- Continuing the corridor housing initiative. Residents help create a vision for their area, helping them buy into the idea of affordable housing instead of fighting it, backers say.

Taller and more affordable?

McLaughlin said if he were elected, he would hold a community dialogue on building height within his first three months in office.

The city is going to grow and get more density, he said. “The zoning structure is inadequate. It permits high density, but these low-slung buildings — three-, four-, five-story buildings — are not necessarily the best urban design,” McLaughlin said.

Building height has hit a public nerve — for instance, the proposed Lagoon project for the Lagoon Theater site in Uptown. Zoning rules limit area building heights to four stories without significant city review. The project originally included a 13-story condo building, which Rybak opposed and the City Council rejected. A 10-story compromise seems likely.

Height hasn’t necessarily been tied to affordability, but McLaughlin is ready to make the link. Developers make more money on taller buildings, and requiring new affordable housing would be the trade-off, he said.

“People get nervous about height,” McLaughlin said, but “that is about how we get our share of the 1 million people and stay the economic center of this region. There is no vision like that,” coming out of the Rybak administration.

Rybak said Downtown has more capacity for high rises. However he feels strongly Minneapolis can grow “without throwing all of the zoning codes out of the window.”

Minneapolis still has acres of empty parking lots and underdeveloped parcels that could grow within existing zoning, he said. He would consider additional height for public purposes — including affordable housing — but it would be the exception. Rybak said he believes homeowners should have confidence that their neighborhood won’t change overnight because a developer wanted to double or triple the permitted height.

“If every developer wants a variance on a zoning code, why have a zoning code at all?” he asked.

Condo conversions

Tenant advocates say developers are converting apartments to condos at a rapid enough rate that city-assisted affordable housing gains are being wiped out.

A new study by affordable housing group HOMELINE suggests 1,350 apartment units affordable to people making 50 percent of metro median income (MMI) were converted to condos in 2003-2004. (Fifty percent MMI is $38,500 for a family of four.)

Both candidates said they are undecided about a condo conversion moratorium.

McLaughlin faulted the city for not having a vision to respond to the hot real estate market. He wants the city to review proposed condo conversions, he said.

“You have to make sure there is adequate upkeep, adequate capital investment at the time of conversion — that we are keeping the housing stock in good shape,” McLaughlin said. “That we are not doing a quick paint job and leaving behind units that are gong to have potential problems in the future.”

Rybak said condo conversion is not a uniform problem citywide. “We want more ownership opportunities in some neighborhoods, especially in North Minneapolis, where a new condo can be a step for someone who

otherwise might never be able to afford a house,” he said.

The issue is different in neighborhoods such as Uptown, he said. He is working with housing advocates on “a series of solutions,” to respond to condo conversions. That plan would focus on preserving federally subsidized Section 8 apartments for low-income tenants.

Rybak had no other specifics. “We are right in the middle of developing solutions,” he said.

Location problems

Affordable housing advocates say it is often as difficult to find a site to build an affordable housing project as it is to fund it. Neighbors organize and oppose them.

One recent example was a Simpson Housing plan to build a 15-20-unit town home at 42nd & Hiawatha for families needing supportive services.

Simpson once seemed to have the inside track and was following city procedures, but the city changed directions after an extremely contentious neighborhood meeting. The city will now involve neighbors in a corridor study and eventually seek competitive bids.

Lee Sheehy, the city’s executive director for Community Planning and Economic Development, said, looking back, it would have been better for everybody had the city done the corridor study first. “We have learned from this. We will be more mindful,” he said.

The Center for Neighborhoods is facilitating the corridor initiative, an effort to involve residents in placing affordable housing. It started with five target areas, said Gretchen Nichols, executive director, and has resulted in three proposals so far for city review, with 140 total units in mixed income buildings — 27 affordable to 50 percent metro median income (MMI) and 49 at 60 percent MMI.

Rybak also takes credit for supporting Lydia House, 1920 LaSalle Ave., in the face of neighborhood opposition. Plymouth Church Neighborhood Foundation converted a former nursing home into apartments with supportive services for recently homeless people — so controversial that some neighbors picketed the church for months.

Foundation Executive Director Lee Blons called Rybak a “wonderful advocate” who supported needed waivers. The city was Lydia Apartments largest funder, she said, and the county — including McLaughlin — also supported it.

McLaughlin said he stood up for a 140-unit housing development for homeless vets on Veterans Administration property when the mayor was a no-show.

Doug Walter, associate director of Nokomis East Neighborhood Association (NENA), said McLaughlin helped shepherd a county lease of federal land to make the Cruse-Miller Garrison project happen. When NENA held meetings and a number of angry neighbors attended, McLaughlin acted as a buffer.

“He let people get up and yell at him. He took it calmly and played it straight,” said Walter, who (as a resident, not a NENA employee) is supporting McLaughlin.

Rybak was invited to the two neighborhood meetings, and he did not attend, Walter said.

Through a spokesperson, Rybak said he could not recall the invitation, but “he is invited to many neighborhood meetings and cannot attend every one.”

McLaughlin also said he lobbied a key Senate conference committee in 2002 for money for the veteran’s housing project, and the mayor, “didn’t lift a finger,” even though he was asked.

Councilmember Scott Benson (11th Ward), a Rybak supporter who heads the Council’s Intergovernmental Relations Committee and lobbies at the Capitol, recalled a meeting with House Speaker Steve Sviggum and Rybak that year on the topic. The Speaker said the veterans housing money would be the only city project in the bonding bill. Rybak supported the veterans housing project, but not as the only city priority.

Sealing the deal

Several affordable housing advocates declined comment for this story. Some said they did not want to jeopardize their nonprofit status by appearing to take sides. Others said they wanted to protect their working relationships with both candidates. Organizations declining comment included the Family Housing Fund, Common Bond, the Metropolitan Interfaith Coalition on Affordable Housing and the Minneapolis Consortium of Community Developers.

McLaughlin has criticized the mayor for not doing more to work with developers on the front end to get deals done.

Both for-profit and nonprofit developers tell him they have asked for mayoral sit-downs and Rybak won’t do it until late in the process, he said. “He thinks it is inappropriate. I don’t think so,” McLaughlin said.

As one example, he cited the Lagoon project, which, in addition to its condo building, includes retail and office space.

Lagoon developer Stuart Ackerberg said he tried for seven months to involve the mayor in discussions. Rybak told him he did not have time to meet but was tracking the project through the planning process.

In the end, Rybak opposed the project’s height.

Rybak acknowledged Ackerberg had asked for meetings. He was working on other priorities, including the city budget, he said.

The mayor disputed McLaughlin’s charge that he was not hands-on. For instance, he was very involved in projects such as the Midtown Exchange, the old Sears building at Lake and Chicago.

“With Allina, the whole city knew we wanted to fill the Sears building with jobs,” Rybak said. “With Ackerberg, he proposed a project than was different from the city’s goals. It required the neighborhoods to be in a conversation with him.”

Rybak notes a number of developers and lobbyists have contributed to McLaughlin. McLaughlin’s finance report includes developers such as Ackerberg, Don Gerberding, Peggy Lucas and Paul Klodt, and former Councilmembers Steve Minn, a developer, and Jackie Cherryhomes, a lobbyist.

Said Rybak about the Lagoon project, “I was able to make an independent decision on what was right for the neighborhood because I wasn’t turning around that night and asking for the campaign check.”

Ackerberg said he gave money to both McLaughlin and Rybak, but Rybak returned the donation. “I think they are both good guys,” he said. “Neither Peter or R.T. are going to be bought for $500” [the maximum donation].

Ackerberg said he tried to involve as many people as possible in the Lagoon development, from the Greenway Coalition to Councilmembers. There was no such thing as a backroom deal because “neighborhoods are incredibly empowered.”

McLaughlin said the mayor’s approach would send developers to the suburbs, where the process is easier.

Rybak said the city did not have to negotiate “from its knees.”

CPED: friend or flop?

On the campaign trail, McLaughlin has criticized the restructuring of the city’s new development arm.

The mayor and City Council took considerable time in 2002 and 2003 to merge the independent Minneapolis Community Development Agency (MCDA) with the planning department, the Empowerment Zone and other city departments with development and jobs-related activities to create CPED — and the so-called One Stop shop.

McLaughlin said CPED has instead been a flop. According to developers he has talked to, it has made it more difficult to complete

projects. If he were mayor, he would make planning a separate agency again, to give it more power.

Rybak said CPED has improved city operations, ending the internal feuds between planners and development staff.

Alan Arthur, president of Central Community Housing Trust, the city’s largest nonprofit developer, said one of the Rybak administration’s challenges is that “it tried to change everything the moment it walked in the door.”

Arthur says Rybak and McLaughlin are both friends of his. McLaughlin serves on his advisory board, and Arthur has contributed to his campaign. He has found both candidates open to working on affordable housing.

Arthur said the jury is still out on whether creating CPED will have a positive impact long term. “I think it has been challenging for everybody to work with an ever-changing environment,” he said.

Williams of LISC, which has supported Minneapolis projects including Franklin Avenue redevelopment, said he thinks the overhaul had helped bring planning and development together under one roof.

“We won’t see the real results of that for some time,” he said. “There is clearly some culture change going on there that I quite frankly think is positive and much needed.”

Developer Ackerberg said it is hard to say if the restructuring had improved the city review process. The systems are only as good as the people who implement them, he said. He praised CPED staff, and said the agency’s biggest problem is not structure but that staff is overworked.

“You have all these people who want to do deals that generate taxes, which is income to the city,” he said. “You have to figure out how to staff it.”

For more on the candidates’ positions see and