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HomeMy WebLinkAbout2022/11/28 - ADMIN - Minutes - City Council - Study Session Official minutes City council study session St. Louis Park, Minnesota Nov. 28, 2022 The meeting convened at 6:30 p.m. Councilmembers present: Mayor Jake Spano, Tim Brausen, Sue Budd, Lynette Dumalag, Larry Kraft, and Margaret Rog Councilmembers absent: Nadia Mohamed Staff present: City Manager (Ms. Keller), Building and Energy Director (Mr. Hoffman), City Attorney (Mr. Mattick), Director of Community Development (Ms. Barton), Housing Supervisor (Ms. Olson), Property Management and Licensing Manager (Mr. Pivec), Communications and Technology Director (Ms. Smith), Solid Waste Manager (Ms. Fisher) Guests: none 1. Single-family rental density cap Ms. Olson provided an overview of the topic. She noted the policy considerations for council’s feedback:  Would creating a rental density cap in single-family neighborhoods achieve the council’s desired outcome of preserving homeownership options?  Does limiting the number of single-family rentals per block align with the city’s adopted strategic priorities? Councilmember Rog commented there is a problem, with 92% of the black residents in St. Louis Park living in rentals. This is the result of past government actions, and it is the city’s responsibility to explore all avenues to address this past harm. She added billions are provided to developers each year to incentivize rental housing and renters walk away with no equity . She added if the city has ways to deal with wealth and equality then she wants to explore this . She stated she wants to talk about rental caps and about single-family homes not becoming rentals. Councilmember Rog noted 842 single family rental homes are in St. Louis Park. She asked what percentage of single-family housing that represents. Ms. Olson stated 7%. Councilmember Rog asked how this percentage compares to neighboring cities. Ms. Olson stated she does not know. Councilmember Rog pointed out the change of homes status from one year to the next. Mr. Hoffman stated over the years the number of single-family homes fluctuated. He stated they don’t always know the reasons for that, and it is not static. Councilmember Rog asked about single-family homes providing for larger families and if the city has any data on that. Ms. Olson stated they do not, and the information comes from assessing. She added on subsidized housing side, all 3-4 bedroom are single-family homes and voucher residents who need larger units also look to rent single-family homes. Ms. Olson stated there DocuSign Envelope ID: 40686F5C-5A00-40E1-A7F7-56E9CD1A3236 Study session minutes -2- Nov. 28, 2022 are other reasons people want a 3-4 bedroom house, as people like to have a choice such as having a yard, or having a basement, but the city has no data on this. Councilmember Rog asked about first-generation home ownership. Ms. Olson noted the Family Self-Sufficiency Program, that STEP coordinates, where home ownership is part of the program’s goals. Councilmember Rog asked if rental rates for city-owned properties are comparable to investor- owned rental properties. Ms. Olson stated in public rental it is based on their income. Ms. Barton stated with vouchers, a home must be found that fits within the parameters of the renter’s income. Councilmember Rog commented on people who needed to do a temporary relocation, that other cities allow for temporary rental licenses up to two years, and asked why we don’t do that in St. Louis Park. Ms. Olson noted accidental landlords do occur and the city could set up rules around temporary rental housing so if the percentage on the block is exceeded, then they would need to do something else with the house, as a rental license would not be available. Mr. Hoffman added if council would want staff to look at these types of exceptions, they could be written into the ordinance. Ms. Barton stated people can get a rental license from the city for 2- 3 years, and therefore would not need a temporary rental license. Councilmember Budd asked if the city has short-term rentals. Mr. Hoffman stated if someone is occupying the property, that is fine, but the city does not allow for short -term rentals such as Airbnb. Also, if a home is not owner occupied for 6 months, then it must be licensed as a rental property. Councilmember Budd asked if there are ways to circumvent abu se of rental licenses. Ms. Barton stated a rental license is still needed if an owner is not living in their home. Ms. Olson stated not every homeowner occupied home has homesteaded their home. Mr. Hoffman stated the city also has many rental homes that are homestead, which is legal. Ms. Olson stated the city does not collect data on single-family home tenants. Councilmember Budd stated 296 of 840 rental homes in the city that are investor owned, which is about 35% being investor owned. She asked if there is any data related to the 10 plus investor rental and if that is trending upward . Ms. Olson stated the data from the Fed is a newer tool. Mr. Hoffman stated there was a period in the past where people owned multiple properties, but a lot of this depends on the real estate market. He stated the market does influence the rental market. Mr. Pivec stated he has noticed trends over the past 10 years, that when the housing market takes a turn, you do see more commercial investments. He stated recently the market has been more stable and the housing stock in St. Louis Park has allowed for homes to be purchased, rented, and sold back into the market. He stated this seems to be more of the current trend. Councilmember Kraft referenced the staff report noting research that shows owners tend to stay away from purchasing rentals in cities that have more rental protections. He asked for DocuSign Envelope ID: 40686F5C-5A00-40E1-A7F7-56E9CD1A3236 Study session minutes -3- Nov. 28, 2022 more detail on this. Ms. Olson explained a 2010 report was done on this, adding this was about disinvestment of rental properties, where owners were purchasing multiple homes in cities where there is not solid licensing or coding, and then not maintaining those homes . Councilmember Kraft asked if rental license training applies to all owners in St. Louis Park. Ms. Olson stated yes, it is required, unless the owner is renting the home to a family member . Councilmember Kraft stated prior than to the great recession, the city was a 2-3% rental and then it jumped and stayed. He asked if this happens again, how do we know if that is happening, is it a problem, and would the city be too late in reacting to that . Ms. Olson stated it depends whether the council thinks that’s a problem. Mr. Hoffman stated the city would notice if the numbers were going up because of rental licenses. Ms. Olson stated staff would take notice. Ms. Barton stated if a trend was noted, staff would dig deeper into it and look at why. She added this is a policy decision and there are folks that want to rent and like to rent. Councilmember Dumalag stated this has been a problem in other communities. St. Louis Park has strong rental policies in place and protections. She stated she is glad only 47 properties are investor-owned, so it’s most likely not an issue. She stated if we are encouraging diverse communities to own here, she would like to see programs in place for this to happen . However, she would not want that to be in competition with our rental homes. Councilmember Rog stated this has so do with the supply issue. She added the supply is equally important to pay attention to and how do we preserve as many for sale opportunities as possible. She agrees with what’s been said tonight and added she agrees we need to watch for trends, and she is mindful of watching supply as well as programs for homeownership. Mayor Spano stated he appreciates this report. He agrees home ownerships gaps are worse in Minnesota versus other states, which is interesting. He asked about Hopkins versus St. Louis Park, noting one-fourth of the houses in Hopkins are investor owned. Ms. Olson stated city staff spoke to Hopkins city staff who stated they did not feel that was an accurate depiction. Mayor Spano asked is this the tool that will help more diverse fol ks be able to purchase homes in St. Louis Park. He noted if there are increases in certain areas, it should be brought back to council for response, and added there would be a concern if an investment company owned multiple homes in one area. Councilmember Brausen stated he appreciates looking at this issue and the local structure in St. Louis Park. He stated we don’t have depressed housing prices that investors are interested in as they can’t make a profit. He added he doesn’t think corporate landlords are looking to invest in St. Louis Park and based on the data, there have not been major changes and he would hate to see competition between rental and single-family home ownership for diverse populations. He stated staff time and money is better well spen t on developing programs for home ownership opportunities, and if it’s funded more robustly, there might be more participation. DocuSign Envelope ID: 40686F5C-5A00-40E1-A7F7-56E9CD1A3236 Study session minutes -4- Nov. 28, 2022 Councilmember Dumalag asked if share of sales is monitored. Ms. Olson stated a homeowner recently sold their home for $35,000 less to help make it more affordable. She added there are more folks in this community that might want to do something similar . Ms. Barton added other programs include the land trust program, the down payment assistance program, and first generation and legacy home sales, as well as building eight new affordable home ownership opportunities, noting these programs will all continue . Ms. Olson added the Homes within Reach program is another way affordable homes can be included into neighborhoods. Councilmember Kraft stated this is something that should be monitored, and supply is also important. He noted tools such as ADU and single-family zoning are ways to potentially address supply over time. He stated as changes are made over time, will this open the city up to investors coming in. He asked if the city has ever thought about additional ways to help with wealth building, separate from homeownership. Councilmember Kraft stated we want opportunities for diverse people and families in St. Louis Park and too many homes owned by investors, especially for the wrong reasons, can have a negative effect on this. He stated the policies in place round inspections and rental training seem to discourage this from happening, so this seems like the way to go, especially with unintended consequences with a cap. He added that said, this should be monitored. Councilmember Rog stated she appreciates this conversation, but noted this was only one item, adding this is really about the supply-side issue and finding affordable entry level homes and then helping people acquire those homes. She noted continuing to monitor is important and added there are opportunities to link the rental housing data base with assessing data to get the information on trends. She stated it is not worth our time to pursue the cap. She shared information from the local economies committee she serves on related to home ownership and investor ownership trends. She stated others are thinking about this, and there are opportunities to work with others on this. Councilmember Budd stated a lens belongs on programs such as the first-generation home buying program, and it would be helpful to see how these programs are utilized . Ms. Olson stated in March, she sends a report to council about usage of programs over the last 10 years. She stated staff does monitor these programs and pointed out the Live Where you Work Program, which later ended, but helped other down payment programs within the city to come out of it. She added programs are amended and modified ongoing. 2. Solid waste program update Ms. Fisher presented the report regarding request for proposal contracts for 2023 – 2028 timeframe and noted program recommendations. She noted the policy question: Does council agree with the proposed changes to the 2023-2028 RFP outlined in the report. DocuSign Envelope ID: 40686F5C-5A00-40E1-A7F7-56E9CD1A3236 Study session minutes -5- Nov. 28, 2022 Councilmember Brausen stated he supports the RFP’s and would like to explore yard waste collection, asking if we do a separate fee. Ms. Fisher stated that yard waste service is included in all solid waste rates, and yard waste can be set out at any time for pick up. Councilmember Brausen stated the yard waste collection seemed to be the issue this year. He added yard waste could be cut back and it seems repetitive. He noted it’s a non-green practice to keep putting yard waste on the curb and having it col lected, even though we encourage mulching. He stated he composts everything, and this doesn’t seem like we are doing the right thing with weekly collection of grass clippings. He stated it’s against the goals we have on climate, and he suggests a separate charge for it and moving it to bi-monthly pick up. Councilmember Kraft thanked staff for all their work during the past challenging two years, and he was impressed with staff stepping up to do pickups. He stated he supports the RFP, and asked if there were two different companies used, he would not want both going down the streets and increase trucks on the road . Ms. Fisher stated it would not increase the number of trucks but would increase the number of haulers providing overall service, with contractor s assigned to one or more material types. Councilmember Kraft asked if garbage goes to the HERC for burning . Ms. Fisher stated yes, and some is diverted to landfill if needed. Councilmember Kraft added he is interested in anything we can do to decrease waste, adding there are environmental justice concerns with the HERC. He added he is interested in organics at multi-family properties and is interested in looking at this ordinance. Ms. Fisher stated to require multi-family to collect organics, there would need to be an ordinance amendment to include organics. She noted this would fit into our climate action plan as well. Councilmember Kraft stated the organics program cost was more initially and now it is part of the full rates. He asked if the rates could be increased and then give a discount for those who do organics. Councilmember Brausen stated he asked this previously and the city attorney stated this could not be done because the service fee must be commensurate with the rates. Councilmember Kraft stated the challenge is you can’t force people to do organics collection . Ms. Fisher stated that is why we structure the program this way and only give the cart to those interested in doing organics collection. She added previously there was a temporary signup discount for doing organics, and this could be explored again . Councilmember Rog stated she supports research into requiring multi-family to do organics recycling. She added she is also interested in Councilmember Brausen’s comments abou t yard waste and staff’s solutions to educating people on what yard waste is. She added she supports more than one hauler. She asked if there is a fine when businesses do not dispose properly and what the penalty is for those that do not comply. Ms. Fisher stated there is a fine for businesses that do not comply with zero waste packaging ordinances, adding they are provided education first to come into compliance. She added there DocuSign Envelope ID: 40686F5C-5A00-40E1-A7F7-56E9CD1A3236 Study session minutes -6- Nov. 28, 2022 have been no fines in the last four years or more, mostly due to the pandemic. She said they will do more outreach in 2023 to work with them to come into compliance. Ms. Fisher stated if a company generates more than four cubic yards of waste in a week, they do have to follow the recycling practices, and food service businesses are required to have garbage, recycling, and organics depending on the type of single use packaging they use to serve food in. She added the city does not monitor collection bins inside of restaurants, but if a complaint is received, the city does look into that and work with the restaurant, but there is no program in place, nor do we have capacity to monitor collection bins in establishments. She added this could be discussed in the future though . Mayor Spano noted there are several establishments that are not following the ordinances in place regarding recycling and organics, and the city is not enforcing it. He stated this may need to be reviewed again and would like a discussion about multi-family organics collection. Mayor Spano asked for a review again of what goes into recycling and what goes into organics and are residents accurately using the program. Ms. Fisher stated contamination levels are very low and rates are under 1.5% when this was reviewed in 2019 and she will share this with council. Mayor Spano stated he is happy to have a discussion around yard waste, but does not want this part of the proposal, adding there could be unintended consequences. He stated resilience with multiple haulers is fine, but with accountability, he would like to look at incentives versus penalties. He asked if we looked at contracts less than five years so we can get out of them, if needed. Ms. Fisher stated we have not contemplated incentives, and this could be researched and discussed further. She added shorter contract periods make it difficult for haulers to recoup on trucks and equipment, so shorter contracts might be less appealing and longer contracts are what haulers are looking for. Mayor Spano stated he is concerned about residents and how do we have the performance we are entitled to in the agreement, so he wants to review mechanisms versus the same form we have used for RFPs in past. Councilmember Budd stated she supports the multi-family organics program and with yard waste going with every other week without extra costs would be appealing to her . Councilmember Dumalag added she is supportive of the changes noted and having more than one vendor. She agreed with multi-family organics collection discussions and agreed with Councilmember Budd’s comments on yard waste. Councilmember Brausen stated he is agreeable to every other week on yard waste collection and added yard waste collection is needed in spring and fall. He agreed with showing a separate charge for yard waste. He added multi-family housing organics collections is difficult because of logistics, so we will need to work with owners to get them on board with this . DocuSign Envelope ID: 40686F5C-5A00-40E1-A7F7-56E9CD1A3236 Study session minutes -7- Nov. 28, 2022 Councilmember Rog thanked Ms. Fisher for her work on assisting residents and her responsiveness to them, especially over the last few years. Written Reports Mayor Spano noted business eco mapping that will be happening in St. Louis Park . Councilmember Brausen asked about the National League of Cities sessions. Mayor Spano reported it went well and there was focus on civility and community culture. Ms. Keller stated it was helpful to have councilmembers there and workshops focused on funding and jobs act and a lot of discussion of core projects and cross pollenating related to federal grant opportunities . Councilmember Rog noted focus groups for small business owners and noted affordable space is a concern and she wants to be sure this is included in the Aware program. Communications/meeting check-in (verbal) Ms. Keller noted applications are being accepted for the councilmember at large seat and are due Dec. 6, 2022. She also noted snow emergency notifications can be signed up for on the city website. She added the Ugly Sweater Dash will be at Louisiana Oaks on Dec. 4 at 5:30 p.m., and everyone is encouraged to sign up. The Holiday Train is coming Dec. 13 at 6 p.m. at STEP. Councilmember Budd referenced the infrastructure report and encouraged residents to watch for it. The meeting adjourned at 8:50 p.m. Written Reports 3. Business program update 4. October 2022 monthly financial report ______________________________________ ______________________________________ Melissa Kennedy, city clerk Jake Spano, mayor DocuSign Envelope ID: 40686F5C-5A00-40E1-A7F7-56E9CD1A3236