The Metropolitan Housing and Redevelopment Authority (Metro HRA) is seeking to expand the number of rental units that households with low incomes can afford by awarding 200 additional project-based housing vouchers.
Project-based vouchers are tied to a specific housing unit. They differ from the traditional housing choice voucher, which is tied to an eligible tenant. In either case, tenants pay 30% of their income towards rent, and Metro HRA pays the difference to the property owner.
The Met Council issued a request for proposals in May for either newly constructed or existing housing to host project-based vouchers. Up to 25% of units in a general-occupancy building (four units minimum) are eligible; up to 100% of units are eligible in a building that provides housing and supportive services to specialized populations, such as people living with disabilities or people experiencing homelessness. The units will be targeted to households with incomes no greater than 50% of area median income.
Project-based vouchers spread availability of affordable housing
Rental housing vacancy rates in the region are currently near historic lows, exacerbating a shortage of rental units affordable to households with low incomes.
“Normally, tenant-based vouchers allow renters more freedom to find a place to live in the community they choose,” explained Terri Smith, Metro HRA Director. “But with the rental market as it is, and has been for some time, many voucher-holders have a tough time finding a unit. The offer and award of project-based vouchers can open opportunity in neighborhoods throughout the region.”
Metro HRA currently administers a total 6,812 federal housing choice vouchers. Of those 5,989 (88%) are tenant-based vouchers; the remainder (823) are project-based. These include 150 single-family homes in 11 suburban communities owned by the Council.
New process allows Council to shape criteria for project awards
In the past, housing authorities and cities have applied for project-based vouchers through Minnesota Housing’s consolidated RFP process. Projects are vetted through Minnesota Housing criteria, and then forwarded to the Met Council for consideration.
With this new process, entities will apply directly to the Council using a simplified application, Smith said. This gives the Council more control over the criteria by which projects are evaluated. The Council will give a project or projects contingent awards, then the developer will go through the annual Minnesota Housing consolidated RFP process. If they get additional financing through that process, the Council will award the project-based vouchers. Project applications for existing housing or for projects that have all financing secured will be awarded by the Council without the need to go through Minnesota Housing.
The deadline for proposals is 4 p.m. on Wednesday, June 17, 2020. Download the RFP and find more information.