From many quarters, evidence is accumulating that the availability and affordability of housing are not sufficient to keep Minnesota thriving. Consider:
• Housing for lower- and middle-income workers has been in short supply in greater Minnesota for so long that employers and city officials have become regulars at the State Capitol, seeking funds to spur construction of both discounted and market-rate homes. The Legislature has responded, but with grants that the Greater Minnesota Partnership says are too small to make a deep dent in the problem.
• More recently has come word from several large employers in the suburban Twin Cities that their lower-income workers can’t find housing they can afford. That’s impairing the companies’ ability to hire and expand. Two major Shakopee employers, Shutterfly and Amazon, as well as FedEx were among the companies cited at a recent conference whose growth in this region could be constrained by a shortage of workforce housing.
• The Metropolitan Council reported this month that the number of the region’s households spending more than 50 percent of their incomes on housing rose 66 percent between 2000 and 2015. During that period, the region’s renters saw an inflation-adjusted decrease in median household income of 13 percent and an inflation-adjusted increase in average monthly rent of 3 percent. Those statistics translate into more households being squeezed out of their homes.
• An every-three-year tally of Minnesota’s homeless population, conducted on Oct. 22, 2015, and released last November, found fewer people without a regular roof over their heads than in 2012 but still 20 percent more than in 2006, before the start of the Great Recession.
Unaffordability was determined to be the single biggest reason people lose permanent housing and the biggest impediment to regaining it. Unemployment is a factor, too, but it isn’t the whole story. Minnesota’s homeless population has a median monthly income of $550, according to Wilder Research’s analysis of the 2015 count. Income that low won’t pay the rent. In the Twin Cities, the average studio apartment rent in the first quarter of 2017 was $823.
• That same 2015 count found that more than half of homeless Minnesotans that night were either on a waiting list for federal housing vouchers or were denied a spot on waiting lists already deemed full. That signals that the need for federal housing assistance remains high — even as the Trump administration is proposing a cut that’s projected to deprive 250,000 households nationwide of housing vouchers.
These housing trends are exacerbating a labor shortage that demographers have long been forecasting for Minnesota in the coming decade. They warrant a new look by local, regional and state policymakers at the public response to the housing needs of low- and middle-income Minnesotans. Better bang for public-housing bucks should be the goal.
The Legislature cannot be accused of neglecting housing. For example, the latest state bonding bill included $77 million for construction of low-income and supportive housing. But it’s not enough to keep up with a worsening problem, says Chip Halbach, executive director of the Minnesota Housing Partnership. “We’re treading water at best,” he said.
It’s been nearly 30 years since Gov. Rudy Perpich assembled a gubernatorial study commission to tune up the state’s response to housing trends not unlike those in play today, while also enlisting more private and nonprofit partners for that work. Housing advocates are still talking about the jump-start that commission gave to Minnesota housing policy. They say a similar high-level review would be beneficial today. We hope that idea is on an executive branch to-do list. If Minnesota allows current housing trends to continue, the state’s prosperity trend line is bound to sag.