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HomeMy WebLinkAbout2021/02/08 - ADMIN - Agenda Packets - City Council - Study SessionAGENDA FEB. 8, 2021 All meetings of the St. Louis Park City Council will be conducted by telephone or other electronic means starting March 30, 2020, and until further notice. This is in accordance with the local emergency declaration issued by the city council, in response to the coronavirus (COVID-19) pandemic and Governor Walz's “Stay Safe MN” executive order 20-056. Some or all members of the St. Louis Park City Council will participate in the Feb. 8, 2021 city council meeting by electronic device or telephone rather than by being personally present at the city council's regular meeting place at 5005 Minnetonka Blvd. Members of the public can monitor the meeting by video and audio at https://bit.ly/watchslpcouncil or by calling +1-312-535-8110 meeting number (access code): 372 106 61 for audio only. Cisco Webex will be used to conduct videoconference meetings of the city council, with council members and staff participating from multiple locations. 6:00 p.m. – STUDY SESSION Discussion items 1. 6:00 p.m. City manager recruitment 2. 7:00 p.m. 2021 housing program and budget summary 3. 8:00 p.m. Home-based businesses 4. 8:45 p.m. Future study session agenda planning and prioritization 8:50 p.m. Communications/updates (verbal) 8:55 p.m. Adjourn Written reports 5. Proposed allocation of 2021 Community Development Block Grant (CDBG) funds The agenda is posted on Fridays on the official city bulletin board in the lobby of city hall and on the text display on civic TV cable channel 17. The agenda and full packet are available by noon on Friday on the city’s website. If you need special accommodations or have questions about the meeting, please call 952-924-2525. Meeting: Study session Meeting date: February 8, 2021 Discussion item: 1 Executive summary Title: City manager recruitment Recommended action: City council to provide human resources direction on next steps in recruitment process. Policy consideration: What process does the council wish to use to recruit for this position? Summary: City Manager Tom Harmening has notified council that he will be stepping down as city manager and retiring after 39 years of public service, 26 years with the City of St. Louis Park and 17 of those serving as its city manager. Tom has offered to the city council his willingness to stay on until a successor has been hired, but not later than Aug. 1, 2021. With this, there is a need to discuss how the council wishes to proceed in filling this vacancy. On Monday, HR Manager Ali Timpone will present an outline on options to move forward for council consideration. Areas of discussion will include, but not limited to, the following: •Position profile development: As with any open position, the first step is to develop a position profile to determine what we are looking for in a city manager candidate. A profile describes the basic responsibilities and duties of the position, reporting relationships and education and experience requirements. Importantly, a profile will also outline the strategic priorities set by council and what will be expected of a successful candidate. •Type of process: Council will need to determine if they would like to post the position as open to external/internal applicants or to internal candidates only. •General timeline for recruitment: Outline showing steps with estimated timeline and dates for full process. This can be finalized once more specifics are determined in how council wishes to proceed. •Consultant: Human resources is recommending working with a consultant to assist council with the hiring process, with HR support. As has been the past process of hiring a city manager, and also with department heads, HR generally works with a consultant on all phases of recruitment through hire. •Interview and process details: Once the general process is determined, more detail will be provided, including the number and types of interviews with council and directors, community participation and other components of this type of recruitment. •Hiring decision: Final selection may include a leadership assessment, background check and approval of an employment contract. As the city manager is hired by council, it is done with approval by contract. Prepared by: Ali Timpone, HR manager Reviewed by: Nancy Deno, deputy city manager/HR director Approved by: Tom Harmening, city manager Meeting: Study session Meeting date: February 8, 2021 Discussion item: 2 Executive summary Title: 2021 housing program and budget summary Recommended action: The purpose of this report is to present an overview of the city’s current and proposed housing initiatives and programs for 2021 along with a summary of the funding sources. Policy consideration: Does the council agree that the current and proposed city housing initiatives and programs support the city’s strategic priorities at a policy level. Summary: The city administers a comprehensive number of housing programs and initiatives in support of furthering the city’s strategic priorities related to promoting and facilitating a balanced and enduring housing stock that offers a continuum of diverse life-cycle housing choices suitable for households of all income levels. The programming offered by the city addresses single-family housing preservation and rehab, affordable home ownership, energy and sustainability, rental assistance, multi-family NOAH preservation, tenant protection, BIPOC homeownership and wealth building, and landlord support and education. Financial or budget considerations: In 2021, the city is proposing to use a combination of the following five funding sources to finance non-federally funded city housing programs and initiatives: 1.Affordable Housing Trust Fund 2.Pooled TIF from non-housing TIF districts 3. Pooled TIF from housing TIF districts 4.Housing Rehab Fund 5.Community Development Block Grant funds Strategic priority consideration: St. Louis Park is committed to providing a broad range of housing and neighborhood oriented development. St. Louis Park is committed to being a leader in racial equity and inclusion in order to create a more just and inclusive community for all. Supporting documents: Discussion Appendix A, housing program summary Appendix B, 2021 housing budget Appendix C, inclusionary housing development Prepared by: Michele Schnitker, community development deputy director/housing supervisor Reviewed by: Karen Barton, community development director Approved by: Tom Harmening, city manager Study session meeting of February 8, 2021 (Item No. 2) Page 2 Title: 2021 housing program and budget summary Discussion Background: In addition to the current housing topics identified by the council, the city has long term goals related to promoting and facilitating a balanced and enduring housing stock that offers a continuum of diverse life-cycle housing choices suitable for households of all income levels including: 1.Creating, preserving and improving the city’s single-family (SF) housing stock. 2.Promoting quality multi-family developments, both rental and owner occupied, in a variety of locations throughout the city, including near transit centers, retail and employment centers and in commercial mixed-use districts. 3.Promoting home ownership including affordable homeownership opportunities. 4.Ensuring all housing is safe and well maintained. To facilitate and support these goals, the city has created and implemented a significant number of housing programs offering a comprehensive variety of financial incentives and services. As the city advances and evolves, the future SWLRT station areas will continue to stimulate housing development opportunities. These opportunities will require mindful decisions to maximize growth that supports and advances the city’s overall Housing Goals and Vision, while preserving naturally occurring single- and multi-family affordable housing in and around these areas. Housing program summaries: Appendix A below, provides a summary of the city’s current housing programs and initiatives. In addition to the city-funded housing initiatives, the St. Louis Park Housing Authority (HA) administers three rental assistance programs: the Public Housing Program, the Housing Choice Voucher program and the Stable Home program. These programs provide income-based affordable housing for approximately 550 families annually, ensuring that they do not pay more than 30% of their income for housing. The HA also administers two service programs that assist residents to successfully live independently and achieve greater economic stability. The annual budget for the HA exceeds $4.3 million annually. Proposed 2021 changes to existing programming: 1.4d affordable housing tax incentive program: The length of the affordability commitment is decreased from 10 years to five years to generate greater participation in the program. The type of properties eligible to participate has also been expanded to include rental duplexes. To date, only one development has elected to participate in the program; however, with the reduction in the length of the affordability commitment, we have received several inquiries from owners exploring participation in 2021. 2.Multi-family rehab loan program: This program was implemented in late 2019 and has had no participation to date. Given the uncertainties in the rental market and that interest rates are extremely low, several changes are being made to the program. The initial length of affordability commitment is being decreased from 10 years to 5 years, with options to extend the affordability commitment and the deferral of the loan in additional five-year increments. An extended affordability commitment will include forgiveness of a portion of the loan balance. The amount forgiven will increase dependent on the length of the affordability commitment. These changes are being made to stimulate participation in the program. Study session meeting of February 8, 2021 (Item No. 2) Page 3 Title: 2021 housing program and budget summary 3.Discount loan: Staff is proposing that funding for this program be suspended for 2021. Due to the extremely low interest rates, there was very little use of this program in 2020. Homeowners can currently access funding with lower interest rates in the private market. Reinstatement of the program will be considered if/when interest rates increase in the future. 4.Move-Up transformation loan: The household income eligibility for this program is being reduced from 120% AMI to 110% and 115% AMI, depending on household size. The new household income eligibility criteria are consistent with income restrictions required for use of Housing TIF as a funding source for the program. Proposed new initiatives: 1.Homeownership and wealth-building loan program for Black, Indigenous, People of Color (BIPOC), and other underserved low-income populations: Staff proposes to create and facilitate a homeownership program designed to address historic inequities and disparities in homeownership rates for BIPOC and other underrepresented low-income households. This program is proposed to provide soft-second mortgages to bridge the gap between the city’s median home price and an affordable home price, based on income level (60-80% of area median income for a family of four). The soft-second mortgage will bear no-interest, have no monthly payments, and be forgivable after 30 years. As part of this effort staff will work with organizations and agencies serving BIPOC populations in order to identify key barriers and challenges to obtaining homeownership, and develop strategies and resource needed to address those challenges. The goal is to address housing disparities, build power in communities most impacted by housing inequities, and pilot a program to address housing challenges and support inclusive and equitable homeownership opportunities. 2.Minnetonka Blvd Multi-family Homeownership land trust development: The city has acquired four single-family homes located on the south side of Minnetonka Boulevard west of Lake Street for potential redevelopment with affordable, ownership housing, to further expand and diversify the city’s housing stock. The properties are zoned R-4 medium-density multi-family residential. All the homes will be built to incorporate significant energy efficient and sustainable features, as appropriate, and will be sold at affordable prices to qualifying low-income households. Staff is in discussions with two non-profit housing organizations to explore the feasibility of a land trust ownership model for the site. Staff will work with the organizations serving the BIPOC communities and other under-represented low-income households to market these homes. 3.NOAH rental multi-family land trust preservation: Staff is pursuing a partnership with a preservation or mission-driven multi-family developer/owner that would be interested in exploring the feasibility and benefits of a land trust model for a multi-family NOAH rental property. Land-trusts are typically used for homeownership but could have significant benefits as a NOAH rental preservation tool, especially in and around the SWLRT stations where redevelopment and gentrification pressures are growing on the city’s NOAH multi-family rental properties. Study session meeting of February 8, 2021 (Item No. 2) Page 4 Title: 2021 housing program and budget summary 2021 Funding Sources In 2021 the city will use five funding sources to finance city housing programs: Funding resource 2020 funding revenue FYE 2020 fund balance 2021 funding revenue Total funding available 2021 Affordable Housing Trust Fund** $1,000,000 $1,000,000 $1,122,000 $2,122,000 Pooled TIF, non- housing TIF districts** $272,621 $272,621 $425,073 $697,694 Pooled TIF, Housing TIF districts** $412,000 $343,455 $412,000 $755,455 CDBG $163,482 0 $160,000 $160,000 Housing Rehab Fund $2,318,855 $2,318,855 0 $1,997,400 Total $4,166,958 $3,866,386 $2,119,073 $5,732,549 *Revenues and expenditures in the above table are estimated based on unaudited 2020 expenses and anticipated revenues for 2021 and are subject to change **TIF and HRA Levy proceeds received mid and end of year 2021 1.Affordable Housing Trust Fund (AHTF): The AHTF is financed through an annual contribution of HRA Levy funds. Salaries for housing staff are also funded with HRA Levy funds. The 2021 HRA levy adopted on 12/21/2020 is $1,437,180. After reductions for 2021 housing rehab salaries ($299,944) and lobbyist costs ($15,000), approximately $1,122,236 is available to fund programs through the trust fund. 2.TIF pooled from non-housing TIF districts: 35% is retained for affordable housing activities from redevelopment TIF districts that are kept open after all developer obligations are paid off. For 2021, the current projection is approximately $425,073 from 3 districts (Wolfe Lake, Ellipse and Eliot Park). Pooled TIF from non-housing TIF districts can only be used for rental projects that are both rent- and income-restricted (20% affordable at 50% AMI or 40% at 60% AMI), and can only be used for capital costs. Pooled TIF funds must remain in the TIF district and are only transferred when eligible expenses have been incurred. The city is currently seeking special legislation that will allow the pooled TIF funds to be deposited into the city’s AHTF, allow the city to use the funds for ownership housing as well as rental housing, and allow use of the funds to be guided by the city’s AHTF policy, which will allow greater flexibility in how the funds are leveraged to create affordable rental and homeownership opportunities. 3.TIF pooled from housing TIF districts: For 2021, the projected amount of TIF pooled from housing TIF districts is $412,000 from two housing TIF districts (Park Center $183,000 and Aquila $229,000). Pooled TIF funds from housing TIF districts can be used for affordable rental (20%/50% AMI or 40%/60% AMI) and/or affordable homeownership housing (affordable to households at 110% and 115% AMI, depending on household size). 4.Community Development Block Grant (CDBG): The city receives an annual allocation of federal CDBG funds from Hennepin County. Historically, the CDBG resources have been used to fund “sticks and bricks” affordable housing programs. In 2020 the city received $163,482 in funding which was used to fund the Low-Income Single-Family Study session meeting of February 8, 2021 (Item No. 2) Page 5 Title: 2021 housing program and budget summary Homeownership Deferred Rehab Loan and the Affordable Housing Land Trust program. It is anticipated that the amount of the 2021 CDBG award will be similar to 2020’s award. 5.Housing rehab funds: The Housing Rehab fund balance consists of funds carried over from FYE 2019. This fund has no significant on-going funding source. Prior to 2019, the primary source of these funds was a fee the city charged entities for issuing private activity bonds on their behalf. Approximately $600,000 is generated annually from these fees. Beginning in 2019, the bond fees are directed to the general fund. The current Housing Rehab fund balance is $1,928,355. These funds will be used to finance programs and initiatives that cannot be funded utilizing other sources due to income and rent restrictions on the use of those funds. Appendix B (attached to this report) lists the 2021 budgeted housing programs, the amount budgeted for each program and the designated funding source. Next steps: Based on council’s input and direction at a policy level, staff will proceed with continued implementation and management of the existing housing initiatives, and planning and development of the new homeownership initiatives listed above. Study session meeting of February 8, 2021 (Item No. 2) Page 6 Title: 2021 housing program and budget summary Appendix A City of St. Louis Park Affordable Housing Initiatives In support of the city’s housing goals to promote and facilitate a balanced and enduring housing stock that offers a continuum of diverse lifecycle housing choices for households in all income levels including affordable housing, the city has implemented a number of programs to create affordable housing, support the preservation of naturally occurring affordable housing (NOAH), facilitate ownership and wealth-building opportunities for BIPOC and other underserved populations, and enact tenant protection policies including: •Inclusionary housing policy: The city adopted the Inclusionary Housing Policy in June 2015. The policy requires market rate multi-family residential developers receiving financial assistance from the city, requesting land use changes through the use of a planned unit development (PUD) or requesting a zoning use amendment to the Comp Plan to include a percentage of affordable units in the development. The units must be affordable to households with incomes at 30%, 50% or 60% area median income, depending on the option chosen by the developer. Since the policy was adopted, the city has added 59 affordable units in four developments. Another four developments are under construction that will add an additional 87 units affordable at or below 60% AMI and 130 units affordable at 80% AMI. There are also several developments that have been approved or are in the planning process. The council amended the policy to include a one-for-one replacement requirement of any NOAH units demolished or converted to another use as part of the development project. •Affordable housing trust fund: In 2018 the city established an Affordable Housing Trust Fund. Housing trust funds are distinct funds established by city, county or state governments that receive ongoing dedicated sources of public funding to support the preservation and production of affordable housing. Housing trust funds can also be a repository for private donations. Money in a housing trust fund may only be used to: 1)make grants, loans, and loan guarantees for the development, rehabilitation, or financing of housing; 2)match other funds from federal, state, or private resources for housing projects; and/or 3)provide down-payment assistance, rental assistance, and homebuyer counseling services. The city may finance the fund with any money available to a local government, unless expressly prohibited by state law. The current primary source of funding for the city’s trust fund is an annual budgeted allocation of HRA levy funds, which was available beginning in 2020. •Land banking/selling public land to facilitate affordable housing development: The city has acquired several land parcels for the purpose of facilitating mixed use development that will include affordable housing units. Three recent examples include the Beltline Station area, the Wooddale station area and the acquisition of the four single family properties on Minnetonka Boulevard as a future site for affordable housing. •4d tax classification program: The city initiated a local program that enables owners of NOAH properties in St. Louis Park to utilize a state property tax provision called 4d, also known as the Low-Income Rental Classification (LIRC). Minnesota’s 4d provision reduces property taxes by approximately 40 percent on rent restricted housing units that are affordable to households making 60% or less of area median income (AMI). Eligible properties must meet two conditions: the owner of the property must agree to rent and income restrictions serving households at 60% AMI or below for at least 20% of the units in the development and they must receive “financial assistance” from federal, state or local Study session meeting of February 8, 2021 (Item No. 2) Page 7 Title: 2021 housing program and budget summary government. This condition allowed the city to create a “Local 4d” program in which qualifying properties receive the 4d tax break in return for agreeing to conditions which meet the city’s housing policy goals. Participating owners must sign a commitment to keep at least 20% of the units in their building affordable for 5 years. In return, the city pays the state application fee for the first year of 4d certification and $200 per unit for energy improvements with a maximum of $6,000 per building. • Multi-family rental rehabilitation loan program: The city implemented a program that provides attractive financing to multifamily rental property owners for rehab or major capital improvements. The program is designed to encourage investments in multifamily rental properties in exchange for a commitment of units affordable for occupancy by low- and moderate-income households. The deferred loan must be used for improvements in qualified units or in common spaces. Rents of the assisted units must be affordable to households with incomes at or below 60% AMI for the entirety of the 5-year term of loan. The owner has the option to extend the loan and affordability commitments in exchange for progressive loan forgiveness. • Tenant protection ordinance: The city enacted an ordinance in 2018 that requires a three month period following the ownership transfer of a NOAH multi-family residential property during which the new owner is required to pay relocation benefits to tenants if the new owner (1) increases the rent, (2) rescreens existing residents, or (3) implements non- renewals without cause and the tenant chooses to move during this period. NOAH properties are defined as buildings where at least 18% of the units have rents affordable to households with incomes at or below 60% Area Medium Income (AMI). This ordinance would not prohibit a new owner from taking the actions listed above; however, the owner would be required to pay resident relocation benefits if they do take any of those actions during the three-month tenant protection period. The ordinance will allow for a period of time for residents to work with housing support resources and seek alternative housing if they are facing unaffordable rent increases, new screening criteria requirements that would be problematic for them, or a thirty day non-renewal without cause notice to vacate. • Legacy program: This program was generated as an outcome of the NOAH preservation workgroup discussions held in 2017/18. The workgroup recognized that the majority of NOAH owners appreciate and care about their residents and that there are owners that would be interested in creating a “legacy” by preserving their property as affordable housing. The program is marketed to owners to make them aware of the financial advantages of transferring their NOAH property to a non-profit preservation buyer. The city will work with property owners and preservation buyers to assist in facilitating the process for any interested owners. • Fair housing policy: Title VIII of the Civil Rights Act establishes federal policy for providing fair housing throughout the United States. The intent of Title VIII is to assure equal housing opportunities for all citizens. The City of St. Louis Park, as a recipient of federal community development funds under Title I of the Housing and Community Development Act of 1974, is obligated to certify that it will affirmatively further fair housing. This policy’s purpose is to outline St. Louis Park’s dedication and response to fair housing issues, which includes designating a fair housing officer to provide referrals to residents and direct them to appropriate agencies to file a fair housing complaint and track the complaint and resources given. • Notice of eviction: Council adopted an ordinance at the end of 2020 that requires landlords to provide a notification to tenants seven days prior to filing an eviction action in court for nonpayment of a financial related obligation. Study session meeting of February 8, 2021 (Item No. 2) Page 8 Title: 2021 housing program and budget summary Rental Assistance • Kids in the Park Rent Assistance Program: Recognizing that housing instability keeps students from attending school consistently and diminishes their likelihood of achieving key measures like reading proficiency, the city implemented a shallow rent subsidy program to assist low-income St. Louis Park rental households who have children attending school in St. Louis Park or their assigned attendance school, to remain in their current housing. The “Kids in the Park Rent Assistance Program” provides rent assistance to households for up to 48 months. The participants receive a flat monthly rental assistance amount that decreases annually over the four-year period. Eligible households must have one parent that works a minimum of 28 hours a week, must reside in rental housing located in St. Louis Park, and be lease compliant. In addition to the rent subsidy, STEP staff meet with each household to assess their economic and social needs, establish a plan to address needs, provide referrals, and offer case management, as needed. Participant households are also required to attend parent- teacher conferences and take an active role in their children’s educational progress. The Housing Authority (HA) is the fourth year of administering the program and is currently serving 17 families on the program. Three additional families will be added in 2021. • Housing Choice Voucher program (HCV): HUD allocated the St. Louis Park HA approximately 342 rental assistance vouchers. In addition to these vouchers, the HA also administers vouchers issued by other HA’s to participants that are renting a unit in St. Louis Park. Participants rent a qualifying unit from a private owner/landlord. The rent paid by the household is based on their household income. The difference in the rent paid by the participant and the market rate rent is paid by the HA. Of the 342 vouchers, 54 are project based at 3 supportive housing developments and at Excelsior and Grand. In 2018 and 2020 the HA also received additional HUD voucher allocations; 15 Mainstream Vouchers that serve nonelderly disabled individuals and 27 Family Unification Program vouchers to serve families where housing is needed to reunite child with their guardians. The HA also assumed the administration of 32 rental assistance vouchers for residents that transitioned from project based to tenant assistance at a privately owned- development that opted out of the rental assistance contract. The HCV rental assistance programs are federally funded. • Public Housing program (PH): The HA owns and manages 157 units of public housing. The units include a 110-unit low rise apartment complex, 37 single family homes scattered throughout the city, and in partnership with Project for Pride in Living, 12 units at Louisiana court. The rent amount is calculated based on household income. HUD also provides additional grant funds annually to assist in funding capital improvements to the PH properties. The PH program is federally funded. • Stable Home Rent Subsidy program: In partnership with Hennepin County, the HA administers a rent subsidy program to serve persons that have been chronically homeless. The program provides rent assistance for three years and the rent amount is based on the household’s income. Participants must reside in suburban Hennepin County. There are currently approximately 40 participants on the program. • Funding provided to STEP for emergency assistance program: The city has provided $60,000 annually to assist in funding STEP’s Emergency Assistance Program which provides rent assistance to families experiencing financial crises. The goal of the program is to intervene to prevent families from losing their housing or having an eviction action on their record. Study session meeting of February 8, 2021 (Item No. 2) Page 9 Title: 2021 housing program and budget summary Promote and Support Responsible Property Management • SPARC – St. Louis Park’s landlord coalition: The city facilitates quarterly meetings with the city’s landlords and rental owners to discuss topics and issues of interest including topics related to good management practices. One initiative with this group has been to recruit new landlords to accept Housing Choice Voucher participants. A newsletter is emailed every other month or more often if needed to all licensed rental properties. • Rental licensing/crime free training : The city requires that rental property staff attend a crime free training as part of the city’s rental licensing requirements. Topics include fair housing requirements to best practices for screening applicants. Affordable Homeownership • West Hennepin Affordable Housing Land Trust (Homes Within Reach): Homes Within Reach is a program of West Hennepin Affordable Housing Land Trust that purchases properties, rehabilitates and then sells the home to qualified low to moderate income households. Buyers pay for the cost of the home only and lease the land for 99 years. City funds are leveraged with CDBG, Hennepin County Affordable Housing Incentive Fund (AHIF) and HOME funds, Metropolitan Council and Minnesota Housing funds as well as other resources. Using the land trust model means that families can more easily purchase a home where they work or live, retain it for generations, and not over burden their incomes in becoming homeowners. There were two homes purchased in St. Louis Park in 2020 for a total of 19 land trust homeownership properties. • Affordable homeownership assistance program: The city implemented an enhanced affordable homeownership program in 2020 that provides down payment and closing cost assistance deferred loans to assist first-time homebuyers (or have not owned a home in the least three years) in purchasing a home in St. Louis Park. Employees of St. Louis Park businesses would be eligible for an additional loan amount to encourage them to live where they work. o The maximum loan amount is $15,000, not to exceed 5% of the purchase price. o Live where you work loan amount: An additional $5,000 to employees of St. Louis Park businesses. o Interest rate and loan terms: 0% interest 20-year deferred loan. 100% of the loan amount is due if the property is sold, ownership is transferred, or no longer owner-occupied. Loan is forgiven after 20 years. Affordable Housing Rehab Programs Technical, Design, and Conservation Services • Architectural design service: This service provides an architectural consultation for residents to assist with brainstorming remodeling possibilities and to raise the awareness of design possibilities for expansions. Residents select an approved architect from a pool developed in conjunction with the MN Chapter of the American Institute of Architects. All homeowners considering renovations are eligible for this service regardless of income; however, to ensure committed participants, residents make a $25 co-pay. • Remodeling/rehab advisor: The intention of this service is to help residents improve their homes (either maintenance or value-added improvements) by providing technical help before and during the construction process. All homeowners are eligible for this service regardless of income. The city contracts with the Center for Energy and Environment (CEE) for this free service to homeowners. Study session meeting of February 8, 2021 (Item No. 2) Page 10 Title: 2021 housing program and budget summary • Home Energy Squad enhanced visit and rebates: Home Energy Squad Enhanced Program is a comprehensive residential energy program designed to help residents save money and energy and stay comfortable in their homes. The program which began in March, 2012, is administered by the Center for Energy and Environment (CEE). The city pays $50 per resident visit which is leveraged with funds from Xcel Energy, Center Point Energy and CEE. The cost per resident is $50 per enhanced visit. The city also provides a match of 50% of gas and electric utility rebates for energy efficient furnaces, water heaters, air conditioners and qualifying air sealing and insulation. • Annual home remodeling fair: The cities and school district community education departments of St. Louis Park, Hopkins, Minnetonka, and Golden Valley co-sponsor the annual home remodeling fair. The fair provides residents an opportunity to attend seminars, talk with vendors and city staff about permits, zoning, home improvement loans, and environmental issues related to remodeling. The fair is a self-sustaining event and vendor registration fees cover the costs. The 2021 fair has been cancelled and will be revisited in 2022. • Home remodeling tour: The annual tour is designed to meet the housing goal to remodel and expand single-family, owner-occupied homes. The self-guided tour of five to six homes provides a showcase of a variety of home remodeling projects to provide ideas, information, and inspiration to other residents considering remodeling. The 2020 tour was cancelled and will be revisited in 2021. • Discount loan program: This program encourages residents to improve their homes by “discounting” the interest rate on the Minnesota Housing Finance Agency (MN Housing) home improvement loans. Residents must have a household income of $104,000 or less. Eligible improvements include most home improvement projects except for luxury items such as pools and spas. The city contracts with CEE for loan administration. • Move–Up Transformation Loan: The purpose of this loan is to encourage residents with incomes at or below 110/115% of median area income, depending on household size, to expand their homes. The program provides deferred loans for 25% of the applicant’s home expansion project cost, with a maximum loan of $25,000. The loan has 0% interest and is forgiven after 30 years if homeowner continues to live in the home. • The Emergency Home Repair Program: The city offers grants of up to $4,000 to low income homeowners to cover the cost of immediate emergency repairs such as furnace replacement, roof repairs, etc. To qualify, a household’s income must be at or below 50% of the area medium income. • Deferred loan program: This loan program assists low income homeowners in funding basic safety and maintenance improvements. The maximum loan amount is $30,000 and the loan is deferred until sale of the property or forgiven after 15 years. To qualify a household’s must be at or below 80% of the area medium income. • Housing Improvement Area (HIA): The HIA is a finance tool to assist with the preservation of the city’s existing townhome and condominium housing stock. An HIA is a defined area within a city where housing improvements are made, and the cost of the improvements are paid in whole or in part from fees imposed on the properties within the area. The Association borrows low interest money from the city, improvements are completed, and unit owners repay the loan through fees imposed on their properties and collected with property tax payments. To date, eight HIA’s have been established and over thirteen million dollars of improvements has been made to 1218 units. Study session meeting of February 8, 2021 (Item No. 2) Page 11 Title: 2021 housing program and budget summary Additional housing programs in process or being explored Housing •Multi-family residential land trust model: The city currently partners with Homes Within Reach to provide single family affordable homeownership opportunities. There may be potential to utilize this same model to create affordable multi-family homeownership or rental opportunities, possibly with the city working in partnership with for-profit or non- profits developers. •Nondiscrimination of rental assistance: This policy would prohibit owners and managing agents from discriminating against people in the leasing and renting of housing based on a person’s receipt of public assistance or any requirements of a public assistance program, including Section 8 vouchers. An ordinance passed in Minneapolis faced a court challenge by rental property owners and a legal appeal. The city, like many other communities, are waiting for the outcome of the legal challenges before further consideration. Planning •Revisiting housing setbacks, FAR, and more to maintain and create more affordable housing: The city council intends to revisit the city’s regulations relating to the sizes of single-family houses. In the late-1990s and mid-2000s, the city relaxed its regulations to promote expansion of single-family houses to encourage residents to stay in the city as their housing space needs increased as opposed to moving to outer ring suburbs where larger home stock is typically available (move up housing). In addition, the changes hoped to reduce variance requests, which they did. The city council will be discussing ways to stem the loss of affordable single-family homes as builders and private owners tear down or add onto older, smaller homes and build much larger ones. Affordable Housing Trust Fund (HRA Levy) Pooled TIF - Non- Housing Districts Pooled TIF - Housing Districts Community Development Block Grant (CDBG) Housing Rehab Fund Funding available:FYE 2020 1,000,000$ 272,621$ 412,000$ 163,482$ 2,318,855$ 2021 1,122,000$ 425,073$ 412,000$ 160,000$ -$ 2020 Expended -$ -$ 68,545$ 163,482$ 321,955$ Total Available 2,122,000$ 697,694$ 755,455$ 160,000$ 1,997,400$ Project Affordability restriction Affordable Housing Trust Fund (HRA Levy) Pooled TIF - Non- Housing Districts Pooled TIF - Housing Districts Community Development Block Grant (CDBG)Housing Rehab Homeownership & Wealth- bulding loan program (BIPOC & Low-income)80% AMI 300,000$ Minnetonka Multi-family homeownership 50-80% AMI 1,000,000$ 300,000$ Multi-family rehab loan 60% AMI 100,000$ 4d incentive program 60% AMI 10,000$ Emergency Repair Grant 50% AMI 18,500$ Land Trust homeownership program Homes Within Reach (WHAHLT)60-80% AMI 70,000$ 30,000$ Foreclosure incentive/land trust 60-80% AMI 10,000$ Housing Improvement Area MH Hsg affordable home limit 5,000$ Move up in the Park Transformation loan 110% AMI for 2 or less, 115% AMI for 3 or more 50,000$ Down payment assistance program for first time homebuyers 110% AMI for 2 or less, 115% AMI for 3 or more 120,000$ Low income deferred home rehab loan up to 80% AMI 125,000$ Rehab advsior none 18,000$ Architectural design services none 11,250$ Home Energy Squad visits none 5,000$ Energy rebates 115% AMI 25,000$ On-bill financing for energy efficient mechanicals MHFA income limit Neighborhood grant program none 52,000$ Kids in the Park rental assistance 50% AMI 135,000$ STEP Emergency Assistance none 60,000$ Realtors forum none 3,000$ SPARC newsletter/meetings none 5,000$ Total budgeted 1,300,000$ -$ 678,500$ 155,000$ 319,250$ 2021 Housing Budget: Programs and Funding Resources Appendix B Page 12 Study session meeting of February 8, 2021 (Item No. 2) Title: 2021 housing program and budget summary Appendix C 1/2021 Inclusionary Housing Development Residential rental housing developments recently completed, under construction or in the planning stages. Initial policy adopted in 2015 applied to developments receiving financial assistance from the city. In 2019, policy was amended to include developments seeking PUD land use approvals or a comp plan amendment. Completed Total # Units Affordable # Affordability Level Policy or Voluntary Est. Year Complete Central Park West Phase I 166 6 60% AMI voluntary 2017 Shoreham 148 30 50% AMI Policy/LIHT 2017 4800 Excelsior 164 18 60% AMI Policy 2017 Parkway 25 112 0 No city financing 2018 Elan West End 164 5 60% AMI voluntary 2020 Sub Total 754 59 Under Construction The Quentin 79 18 60% Policy 2021 Elmwood 70 17 60% Policy + 2020 Urban Park Apartments 61 0 Market rate No city financing 2021 Place – Via Sol 217 22 130 22 - 50% 130 - 80% Policy+ 2021 Parkway Residences 235 – total (211/new 24/existing) 30 – total (6 new /24 existing) 24-50% 6–60% Policy and one for one 2022 Sub Total 662 217 Approved Arlington Row 61 6 80% AMI Policy/Met Council On hold Luxe -Olive Garden 207 8 60% Voluntary 2021 Platia Place/SLP living 137 15 50% Policy + 2021 Union Congregational Church (Union Park Flats) 60 6 54 6-30% 54-50/80% Policy + 2022 Texa-Tonka Apt. 95-apt 11-TH 22 50% Policy 2022 Sub Total 571 111 Proposed Projects Total # Units Affordable # Affordability Level Policy of Voluntary Est. Year Complete Beltline 401* 121 50% Policy/LIHTC 2022 Prince of Peace/Common Bond 120 120 19-30% 101-50/80%Policy+ 2022 Saturday Properties Wooddale Station 285 227 58 227-80% 58-50/60%Policy+ 2023 Sub Total 806 526 Total 2,793 913 Page 13 Study session meeting of February 8, 2021 (Item No. 2) Title: 2021 housing program and budget summary Appendix C 1/2021 Met Council’s Allocation of Affordable Housing Need for St. Louis Park Comprehensive Housing Market Study – 2018 Maxfield research Summary of Housing Demand Type of Use General-Occupancy Rental Units - Market Rate Rental Units - Affordable Rental Units - Subsidized For-Sale Units - Single-family For-Sale Units - Multifamily 645 409 318 227 1,107 Total General Occupancy Supportable 2,707 2017 2030 Age-Restricted (Senior) Market Rate Adult Few Services (Active Adult) 373 437 Ownership 135 164 Rental 238 273 Congregate 0 0 Assisted Living 160 203 Memory Care 63 79 Total Market Rate Senior Supportable 596 719 Affordable/Subsidized Active Adult - Subsidized 1 22 Active Adult - Affordable 212 254 Total Affordable Senior Supportable 213 275 Note: Demand subtracts projects under construction, planned, or pending 2017-2030 Affordability Met Council Allocation (2011-2020) SLP units completed and under construction Total SLP affordable units At or below 30% AMI 229 31-50% AMI 132 30 51-80%78 29 Total 439 59 59 Met Council Allocation (2021-2030) SLP units completed and under construction SLP units approved SLP units pending Total SLP affordable units (2021- 2023+) At or below 30% AMI 309 6 19 25 31-50% AMI 178 46 37 121 204 51-80% AMI 106 171 68 159 398 Total 593 217 111 299 627 Page 14 Study session meeting of February 8, 2021 (Item No. 2) Title: 2021 housing program and budget summary Meeting: Study session Meeting date: February 8, 2021 Discussion item: 3 Executive summary Title: Home-based businesses Recommended action: None at this time. The city council asked to discuss the topic before initiating the formal process to consider ordinance amendments after receiving the most recent written report from staff on Jan. 11, 2021. Policy consideration: This item is fifth on the city council’s list of priority study session discussion topics. Please inform staff of questions or comments you may have. Summary: The city council added a review of home occupations as a priority discussion topic in 2020. Also, planning commission had included it in its 2020 work plan. Staff prepared an amendment based on comments received from a November 4, 2020 planning commission study session discussion and also tried to address the issues raised by city council when the topic was introduced. The planning commission discussed the draft ordinance on Dec. 2, 2020. They agreed to forward the draft to the city council for comments before advancing the item further. The draft ordinance was presented to the council in a written report at the Jan. 11, 2021 study session. Some comments were received and are summarized in the attached discussion. A detailed description of the proposed amendment is attached in the discussion. The following summarizes the changes: •Allow barbers/hairdressers. •Allow one outside employee that does not reside on the property. •Allow home occupations to be conducted in accessory buildings, including accessory dwelling units (ADU). •Allow the size of a home occupation to be equal to 25% of the floor area of a dwelling (currently they are limited to 10%). •Allow residents of an ADU to conduct home occupations in the ADU. Financial or budget considerations: Not at this time. Strategic priority consideration: St. Louis Park is committed to providing a broad range of housing and neighborhood oriented development. Supporting documents: Discussion Proposed amendment Nov. 4, 2020 planning commission minutes Dec. 2, 2020 planning commission minutes June 10, 2019 council study session minutes Prepared by: Gary Morrison, assistant zoning administrator Reviewed by: Sean Walther, planning and zoning supervisor Karen Barton, community development director Approved by: Tom Harmening, city manager Study session meeting of February 8, 2021 (Item No. 3) Page 2 Title: Home-based businesses Discussion Background: A review of the home occupation ordinance was added as a priority discussion by the council. Additionally, the planning commission had included the topic in its 2020 work plan. The council briefly discussed the home occupation regulations on June 10, 2019 in conjunction with a discussion about accessory dwelling units. The planning commission reviewed a draft ordinance on November 4, 2020 and revisions to the draft ordinance on December 2, 2020. The planning commission agreed council should review the draft ordinance before initiating a public hearing. The draft ordinance was provided to the council on January 11, 2021 as a written report. Comments were received from some council members, so council is asked to discuss the draft ordinance and provide policy direction to planning commission and city staff. The following is a summary of questions and comments received from council members: 1.What led to this topic being considered? What problem are we trying to solve? The discussion was initiated as a response to resident inquiries to some council members for changes to the home occupation regulations. Primarily to allow home occupations to occur in accessory buildings and to allow an employee that does not live at the residence. Additionally, the topic was on the planning commission 2020 workplan. The pandemic also provided an impetus to review the code to accommodate additional work at home options. 2.25% of the space in an ADU may be overly limiting? Can an ADU be dedicated to the home occupation if it is less than 25% of the total floor area of the principal plus ADU? The planning commission may have intended for the home occupation limit to be 25% of the combined home and ADU. The property owner could then allocate the square footage in any manner between the principal dwelling and the ADU as long as the 25% limit is not exceeded. This is a policy question for the planning commission to advise and the city council to decide. Staff will approach this however city council wants this to work, and we will craft the ordinance language to try to implement the policy direction. Here are some things to be discussed and considered. •ADUs are accessory to the principal use of a lot as a residence and limited in size based on the sizes of the lot and principal dwelling. •A home occupation is an accessory use of the lot as a residence, too, and limited in size based on the size of the principal dwelling. •If the resident(s) live in an ADU, should their home occupation be based on the size of the ADU or based on the lot as a whole? •What are the differences in the impacts to neighbors or to the public’s interest, if any? •Are there unique and avoidable complications for administering the ordinance one way or the other? 3.Is the requirement that the operation of the home occupation not be apparent from the public right-of-way and allowing a sign up to 2 square feet at odds with each other? All residential properties can have a sign of that size. The content of the sign should be neutral. Study session meeting of February 8, 2021 (Item No. 3) Page 3 Title: Home-based businesses 4.Should home occupations register with the city? The code currently requires home occupations to register only if it has customers or students coming to the site. This could be amended to require registration if it includes outside employees, remain as is, or amended more broadly. 5.Is the one employee cap limited to one person or one full-time equivalent? Staff contemplated one person. Review and enforcement of hours worked by multiple people would be problematic and potentially unenforceable. The city does not have access to the employment records unless they were voluntarily given. It also invites the possibility of overlap and having two employees on-site at one time. Draft ordinance: In addition to the amendments discussed below, staff also proposes moving the home occupation regulations from each of the residential and PUD zoning districts to a new subsection in the general residential district regulations section of the zoning ordinance. This section contains regulations that apply to all residential districts, including rules for accessory structures, accessory dwelling units, vehicle parking and other miscellaneous residential regulations. Consolidating all the rules to one section would reduce redundancy in the code and would be easier to maintain consistency of the regulations. The drafted amendment includes: •Allowing barbers/hairdressers as a home occupation. Currently, they are prohibited as home occupations. •Allow one outside employee to work at the property where the home occupation is based. The employee may work at a home occupation conducted by the occupant of either the principal or accessory dwelling. The draft does not allow an employee at both home occupations for those instances when a home occupation is conducted by the occupants of both the principal dwelling and accessory dwelling. •Allow home occupations to be conducted in accessory buildings. The draft proposes to allow the use of accessory buildings with the condition that the property meets parking requirements. The condition is necessary to preserve garage parking spaces if those spaces are needed to meet the off-street parking minimum requirements. Therefore, a request to utilize a garage for a home occupation would be denied if the only parking spaces available for the residence is in the front yard or the street. Utilizing the garage would be allowed if the homeowner provides two parking spaces in the side or backyard. •Allow a home occupation to occupy more than 10% of the home. Section 36-115(e) defines an accessory use as a secondary use that occupies less than 25% of the building area. To be consistent with this provision, staff proposes to increase the maximum allowed floor area for home occupations from 10% to 25%. The size limit for a home occupation conducted by the occupant of the principal dwelling will be based on the size of the principal dwelling. Home occupations based out of an accessory dwelling unit will be based on the size of the accessory dwelling unit. Study session meeting of February 8, 2021 (Item No. 3) Page 4 Title: Home-based businesses •Allow residents of accessory dwelling units to conduct home occupations. The draft allows the occupants of both the principal dwelling and the ADU to each conduct their own home occupations. As drafted, home occupations conducted by the occupants of the ADU are limited to 25% of the ADU. Furthermore, the draft limits the number of outside employees that do not reside on the property to no more than one outside employee per lot. The home occupation conducted in the ADU cannot have an employee if there is already a home occupation with an outside employee conducted in the principal dwelling and vice versa. •Allow equipment that is not typically present in a residential household, provided it has no negative impacts on adjacent residential properties, is small enough in scale so as to not infringe on the residential character of the home, and the equipment does not result in undue impacts to public infrastructure. The draft ordinance proposes to eliminate the provision limiting equipment to that which is normally found in a home. Instead, the ordinance would rely on the other provisions that prohibit nuisance impacts such as noise, smells, vibrations, etc. The equipment is permitted if its use is not perceptible to adjacent properties. Home occupations conducted in apartments, condominiums, townhomes or other dwelling units sharing a common wall will have a more difficulty meeting this requirement, and therefore, will be subject to greater limitations as to the equipment allowed. Staff further considered the planning commission’s interest in allowing pet walking and grooming activities if the number of pets at the home does not exceed the number currently allowed for a residence. The city currently allows up to three adult dogs. Any number of puppies are allowed up to four months of age. There are no limits on cats, rabbits or other domesticated pets. Staff has concerns about allowing animal handling and professional grooming as a home occupation. Professional grooming and animal handling facilities involve handling animals with varying dispositions. Including this use and added risk into a residential setting puts neighbors at risk that may encounter the animal while it is outside. Additionally, dogs in new settings are very likely to bark at noises and people in an unfamiliar area, predictably resulting in nuisance situations. The planning commission agreed not to allow this use. Therefore, the current draft continues to prohibit animal handling. Next steps: Staff will share a summary of city council’s discussion and any policy direction with the planning commission. Then initiate the formal process to consider adoption of any proposed amendments to the current code. Study session meeting of February 8, 2021 (Item No. 3) Page 5 Title: Home-based businesses Proposed amendment Home occupations are described as commercial uses in the following section 36-142.(d)(14): Home occupation is an occupation, profession or activity conducted in a dwelling unit, which is clearly an incidental and subordinate use to the residential use and which does not alter the exterior of the property or affect the residential character of the neighborhood. Home Occupations Home occupations complying with all of the following conditions: a.A registration of land use is required for any home occupation established after July 12, 2019, that has customers or students coming to the site. b.The home occupation and structure housing the home occupation meets all applicable fire and building codes, as well as any other city, county, state, or federal regulations. c.The home occupation is clearly incidental and subordinate to the residential use of the property and does not change the character of the property. d.The floor area of the home occupation cannot exceed 25% of the total floor area of the principal dwelling unit. If the home occupation is conducted by the occupant of an accessory dwelling unit, then it is limited to 25% of the floor area of the accessory dwelling unit. Space within the dwelling devoted to the home occupation does not exceed one room or ten percent of the floor area, whichever is greater. e. The No portion of the home occupation may be is conducted within any attached or detached accessory building if the property complies with the minimum required parking for the property. f.Operation of the home occupation is not apparent from the public right-of-way. g.Only equipment, machinery, and materials which are normally found in the home are used in the conduct of the occupation. h.All material or equipment is stored within an enclosed structure. i.The home occupation does not produce nuisance noise, odors, smoke, heat, glare, vibration, or electrical interference beyond the residential lot occupied by the home occupation. j.No person is employed at the residence One person who does not legally reside at the property in the home may be employed at a home occupation occurring in either the principal dwelling or the accessory dwelling unit. k.Persons do not come to the location of the home occupation to be dispatched to other locations, or to pick-up or drop-off equipment, materials, or supplies. l.Sale of products related to the home occupation is allowed with the following conditions: i.Products are shipped to and from the premises; or ii. Product sales occur off-site at a permissible location; or iii.Customers visit the premises by appointment only; or iv.Products are sold on the premises at garage sales as regulated by this chapter. m.No more than one non-illuminated wall sign up to two square feet in area is used to identify the home occupation. n.The home occupation does not include any of the following uses: auto body/painting, motor vehicle sales, motor vehicle service and repair, small engine repair, massage, medical/dental office, animal handling, beauty shop and barbershop, restaurant, firearm sales, currency exchange, payday loan agency, sexually-oriented business or high-impact sexually oriented business. Study session meeting of February 8, 2021 (Item No. 3) Page 6 Title: Home-based businesses EXCERPT OF OFFICIAL MINUTES PLANNING COMMISSION ST. LOUIS PARK, MINNESOTA NOVEMBER 4, 2020 – 6:00 p.m. COUNCIL CHAMBERS MEMBERS PRESENT: Jim Beneke, Imran Dagane (arrived 6:25 p.m.), Matt Eckholm, Jessica Kraft, Tom Weber (arrived 6:30 p.m.) MEMBERS ABSENT: Courtney Erwin STAFF PRESENT: Jennifer Monson, Gary Morrison, Sean Walther, Mara Hynek STUDY SESSION The study session commenced at 6:25 p.m. 2.Home occupations Mr. Morrison presented the report. He noted this is a priority discussion topic in the 2020 work plan for the commission and for the city council. He noted several previously raised topics for discussion lifting the prohibition on barbers/hairdressers as a home occupation allowing one or more outside employees, allowing home occupations in accessory buildings, allowing them occupy more than 10% of the principal building, and allowing residents of ADUs to conduct home occupations in the ADU they occupy. Mr. Morrison stated discussion about the uses and character of the residential neighborhood should also be discussed to provide context for other decisions. Commissioner Weber asked if the registration of land use requirement applies to people working from home now during the pandemic, such as home offices. Mr. Walther stated the registration of land use is required only when there are customers or students that come to the home. It does not apply to a home office if people living there are using the office. Commissioner Eckholm asked about machinery and/or equipment uses within the home. He stated this may need to be re-worded to be more permissive. Commissioner Weber noted the animal handling occupation and asked if this would be allowed as long as they stay within the city’s allowable three animal/pet limit. Mr. Morrison stated this can be discussed further. Commissioner Weber stated there would seem to be many examples of people who would be surprised they are breaking city rules with their home occupation. He stated Study session meeting of February 8, 2021 (Item No. 3) Page 7 Title: Home-based businesses he thinks about this being a first interaction with the city and the impression that would leave for them. Mr. Morrison stated staff typically will not contact the person unless a city staff person witnesses the violation. Mr. Walther added, in practice, staff is not out doing house calls and aggressively searching for these types of violations but noted the city does regularly receive complaints from neighbors about home occupations that run afoul of the rules. A common one is car repair service; there are multiple cars being repaired or stored outside on a property in various states of repair. Commissioner Weber asked if the city has specified the language in the ADU ordinance that says the actual ADU is actually used primarily or only for the home occupation. Mr. Walther stated this was one of the reasons raised by city council for having this discussion. He stated right now it is a bit grey in this area as to how to interpret the code, so more clarity will need to come of this. Commissioner Beneke stated he is unclear as to what he would want to do with the ADU/home occupation, and this warrants more discussion. Chair Kraft stated she is in alignment with most of what has been discussed. She would have concerns with noises or odors but has no concerns about barber/beauty salons, daycares, or a 3D printer in a house. Commissioner Weber would also support some research into barber/beauty salons, as it serves a path of entry into business ownership, especially for communities that may not have access to commercial space. Commissioner Beneke added he agrees with this idea in general. Commissioner Dagane agreed with the comments made in the discussion as well and would have concerns also with what kind of business it was and traffic issues. Mr. Walther stated this topic will be researched further and brought to the council for input before the discussions are concluded with the commission. This will allow the commission to discuss after council and incorporate council comments in their deliberation. The meeting was adjourned at 8:05 p.m. Study session meeting of February 8, 2021 (Item No. 3) Page 8 Title: Home-based businesses EXCERPT OF UNOFFICIAL MINUTES PLANNING COMMISSION ST. LOUIS PARK, MINNESOTA Dec. 2, 2020 – 6:00 p.m. COUNCIL CHAMBERS MEMBERS PRESENT: Imran Dagane, Matt Eckholm, Courtney Erwin, Jessica Kraft, Tom Weber MEMBERS ABSENT: Jim Beneke STAFF PRESENT: Gary Morrison, Sean Walther STUDY SESSION The study session commenced at 6:16 p.m. 1.Home Occupations Ordinance Gary Morrison, assistant zoning administrator, provided the report. He noted proposed changes such as allowing land uses the commission discussed at the last meeting, including barbers and hairdressers, allowing one outside employee, allowing home occupations in accessory buildings, allowing the home occupation to occupy more than 10% of the dwelling area, and allowing residents of accessory dwelling units to have home occupations. He also noted changes proposed to the conditions noted in the staff report. Commissioner Weber asked about the restaurant example and that was okay because the occupation was not happening within a residence. Mr. Morrison stated the ordinance allows for office space and catering to a point, but not restaurant service to customers on site. Commissioner Erwin asked related to Covid and if the wording is acceptable for licensed barber or beauticians within a residential area and as a home occupation. Mr. Morrison stated that barbers and beauticians are required to be licensed by the city and state, and if they pass this licensing requirement, they are allowed within a home occupation. Commissioner Weber asked what the reason is for banning a massage business. Mr. Morrison stated massage, medical and dental typically occur in a more professional office setting in the city for the protection of the clients. Chair Kraft stated with Covid there seems to be more mobile businesses and if that is related to home occupations or handled differently. Mr. Morrison stated it is the same if the office portion is located within the home, however with trucks or van, they must meet size limitations to be parked in a home driveway. Mr. Walther added mobile uses are also regulated, such as a food truck must receive permits. Additionally, mobile services that go to another person’s home to conduct services and leave Study session meeting of February 8, 2021 (Item No. 3) Page 9 Title: Home-based businesses within a certain timeframe are treated differently than a home occupation where the vehicle is parked or stored. Commissioner Eckholm stated the draft reflects the commissions feelings on the ordinance and is a marked improvement. Mr. Walther stated the proposed ordinance will be shared with council as a written report before staff initiates the formal public process. The meeting was adjourned at 6:52 p.m. Meeting: Study session Meeting date: February 8, 2021 Discussion item: 4 Executive summary Title: Future study session agenda planning and prioritization Recommended action: The city council and city manager to set the agenda the regularly scheduled study session on Feb. 22, 2021. Policy consideration: Not applicable. Summary: This report summarizes the proposed agenda for the regularly scheduled study session on Feb.22, 2021. Also attached to this report is the study session discussion topics and timeline Financial or budget considerations: Not applicable. Strategic priority consideration: Not applicable. Supporting documents: Tentative agenda – Feb. 22, 2021 Study session discussion topics and timeline Prepared by: Debbie Fischer, administrative services office assistant Reviewed by: Maria Solano, senior management analyst Approved by: Tom Harmening, city manager Study session meeting of February 8, 2021 (Item No. 4) Page 2 Title: Future study session agenda planning and prioritization FEB.22, 2021. 6:30 p.m. Study session - To be held via videoconference Tentative discussion items 1.Policing discussion - continued– community development (90 minutes) Staff will provide an update on current policing initiatives and consultant, Shawn Sorrell, will lead the council in a discussion using the “Re-imagining Community Safety” chart that the council previously created. 2.P4 Revisit housing setbacks, FAR, & more related to affordable housing – Community development (60 minutes) At the request of council, staff will be present to discuss whether revisions to the zoning ordinance might be necessary to limit the scale of additions and new construction. 3.Future study session agenda planning – administrative services (5 minutes) Communications/meeting check-in – administrative services (5 minutes) Time for communications between staff and council will be set aside on every study session agenda for the purposes of information sharing. Written reports 5.Jan. 2021 monthly financial report 6.P11 Conversion therapy ban 7.SLP Living TIF request Study session meeting of February 8, 2021 (Item No. 4) Page 3 Title: Future study session agenda planning and prioritization Study session discussion topics and timeline Future council items Priority Discussion topic Comments Timeline for council discussion 3 Discuss public process expectations and outcomes Staff is working on the approach for undertaking this discussion. 2nd qtr. 2021 4 Revisit housing setback, FAR, & more related to affordable housing Going to planning commission for discussion. Discuss 2/22/21 5 Home-based businesses (HBB) Written report 1/11/21 Discuss 2/8/21 6 Public forums at council mtgs 9/23/19 SS. Staff doing research of other cities. 2nd qtr. 2021 8 Community and neighborhood sidewalk designations To be combined w/ Connect the Park discussion. 2nd qtr. 2021 9 Remove mint & menthol exemption from existing flavored tobacco policy On hold pending court decision *On hold 10/13 -Easy access to nature, across city, starting w/ low-income neighborhoods -WHNC Access Fund Combine P10 and P13. *On hold pending direction from school district.*On hold 11 Conversion therapy ban Staff is preparing information for council Report 2/22/21 + Creating pathways to home ownership for BIPOC individuals and families TBD + Transportation commission TBD + Council meetings – agenda and video presentation TBD + Inclusionary housing policy – requiring family size units TBD Council items in progress Priority Discussion topic Comments Next Steps 7 STEP discussion: facilities Council asked staff to consider lending options to assist STEP in buying a new bldg. On hold + Policing discussion Discussed 7/27/20 & 9/29/20. Discuss 2/22/21 + Boards and commissions: recruitment & appointment process, other Discussed 1/25/21. TBD Meeting: Study session Meeting date: February 8, 2021 Written report: 5 Executive summary Title: Proposed allocation of 2021 Community Development Block Grant (CDBG) funds Recommended action: No action required at this time. This report is being provided to inform council of the proposed allocation of 2020 CDBG funds in preparation for the required public hearing scheduled for Feb. 16, 2021. Policy consideration: Does the city council concur with the recommendations made for the allocation of $163,482 in 2020 CDBG funds? Summary: Each year the city receives an allocation of federal CDBG funds and must decide how to use those funds. CDBG funds are U.S. Housing and Urban Development (HUD) funds distributed through Hennepin County. The city must submit its proposed use of the allocation to Hennepin County. Prior to submittal, the city must hold a public hearing. This year, the hearing and official city council action is scheduled for February 16, 2021. The city has not been notified of its estimated 2021 direct allocation, so for planning purposes staff is using the 2020 direct allocation amount of $163,482 as an estimate. This year’s proposed use of CDBG funds reflects the city’s priorities to preserve existing housing and increase affordable home ownership opportunities by allocating $133,482 to the low- income deferred rehab loan program and $30,000 to Homes Within Reach land trust program. Beginning in 2018, 15 percent of the overall CDBG budget is required to be set aside by Hennepin County for public service activities and awarded through a single, combined, competitive RFP covering all the cities in the county program. Financial or budget considerations: CDBG funds allow cities discretion, within HUD guidelines, to fund projects that meet the national low-income objectives and the needs of the cities. The federal budget has not been finalized so the estimate 2021 funding amount of $163,482 may change. The 2021 CDBG year runs from July 1, 2021 through June 30, 2022. Strategic priority consideration: St. Louis Park is committed to providing a broad range of housing and neighborhood oriented development. Supporting documents: Discussion Prepared by: Marney Olson, assistant housing supervisor Reviewed by: Karen Barton, community development director Approved by: Tom Harmening, city manager Study session meeting of February 8, 2021 (Item No. 5) Page 2 Title: Proposed allocation of 2021 Community Development Block Grant (CDBG) funds Discussion Background: The national objectives of the CDBG program are to benefit low- and moderate- income persons, prevent or eliminate slum or blight, and/or to meet a particular urgent community development need. Additionally, the CDBG program allows for up to 15 percent of allocated funds to be used to fund public services. The city council has typically focused CDBG funds on improvements to the housing stock for low-income families or on affordable homeownership program. Beginning in 2018, Hennepin County began setting aside 15 percent of the overall CDBG budget for public service activities awarded through a single, combined, competitive RFP. Prior to that date, cities were allowed to allocate up to 15 percent of their individual award to social service agencies. Hennepin County now manages the RFP process and sends information to a long list of public service providers throughout the metro, including past recipients. The city has provided a letter of support to STEP for their application in previous years and will support their 2021 application upon request. In the past the city used to also fund rehabilitation and improvements for affordable housing providers in St. Louis Park. Due to federal regulations requiring Davis Bacon Wage laws, other regulatory requirements related to the use of federal funding for multifamily properties and St. Louis Park’s limited CDBG award, small CDBG awards both complicated and increased the costs of these projects. The two programs the city continues to fund with CDBG dollars are for individual owner-occupied properties, to which the federal regulations that impact multifamily properties do not apply. Present considerations: The proposed use of the $163,482 estimated allocation include $133,482 for the low-income deferred rehab loan administered by Hennepin County and $30,000 to Homes Within Reach affordable housing land trust. If there are any increases or decreases to the allocation, the deferred rehab loan will be adjusted accordingly. These two programs address the need for affordable housing support the city council’s strategic priority to providing a broad range of housing for the community. The low-income deferred loan program is a program for homeowners with annual incomes at or below 80 percent of area median income. The rehab focuses on improvements to bring homes into code compliance, address deferred maintenance and provide long-term maintenance-free housing. The maximum loan amount is $30,000 and is deferred until the sale of the home or forgiven after 15 years. There are currently 44 households on the waiting list, demonstrating the need to continue allocating CDBG dollars to this program. The county has seen an increase in requests in 2020 in all of the cities for which they administer this program. Homes Within Reach is a program of the West Hennepin Housing Land Trust (WHAHLT) that purchases homes and sells them to low-income homeowners. Buyers purchase the house only and lease the land for 99 years for a nominal amount, thus providing affordable homeownership opportunities. St. Louis Park funds are leveraged with Met Council and Hennepin County HOME funds. The city has partnered with Homes Within Reach since 2006. To date, Homes Within Reach has purchased, rehabbed and sold 19 homes in St. Louis Park. The St. Louis Park Housing Authority reviewed the recommended proposal for use of 2021 CDBG funds at the January 2021 board meeting and supports the allocation as proposed. Next steps: A public hearing and resolution of approval of proposed activities is scheduled for Feb. 16, 2021.