For the last 18 months, Alliance Executive Director Jessie Hendel has served as a member of the Task Force on Long-Term Sustainability of Affordable Housing. Created by the Minnesota State Legislature, the Task Force was charged with:
1) Assessing financial challenges to develop, operate, and preserve safe, affordable, and dignified housing
2) Evaluating current financing and administrative tools to develop, operate, and preserve safe affordable housing
3) Evaluate financial or asset management practices of affordable housing providers and support for asset management functions by funder organizations
4) Recommend potential solutions to develop and preserve safe and affordable housing.
Essentially, the Task Force’s goal is to ensure organizations don’t find themselves in situations like we have with 2011 Pillsbury.
The Task Force completed its work in February (you can find the final report here) and on February 25, Jessie joined several other members of the Task Force in testifying before the Senate Housing and Homeless Prevention Committee. In addition to the Task Force’s final report, many testifiers spoke about the results of the Distressed Property Data Project, which demonstrates in stark terms the financial challenges all affordable housing providers in Minnesota face. To pick just a single data point from the report, investigators analyzed the finances of over 26,000 homes in more than 450 buildings across Minnesota and found property insurance costs increased $240-$260 per home between 2018 and 2023. For a 50-unit building this would result in an insurance increase of up to $13,000 over the course of five years. As Project for Pride in Living Chief Operating Officer Scott Cordes testified, when it comes to keeping buildings affordable in the face of these increased costs “the math doesn’t math.”
In her testimony, Jessie spoke about our experience with 2011 Pillsbury and the increase in operating losses there from $100,000 in 2020 to $250,000 in 2024. This led to the difficult decision to sell the building so we don’t put our ability to continue to serve residents in other buildings at risk. Former Hope Community Executive Director Shannon Smith Jones testified about losing Dundry House shortly after putting $2 million into the property. Family Housing Fund President Ellen Sahli noted that “all affordable housing providers, nonprofit and for profit, Metro and in Greater Minnesota, are struggling.”
Having completed its report, the Task Force, and all affordable housing advocates in Minnesota, now look to the legislature to take the next steps. As Task Force member Joseph Abraham, principal owner of Pergola Property Management, noted, many members of the Task Force served on a similar group under Governor Dayton, but governmental follow up on that group’s recommendations wasn’t there. Accordingly, Mr. Abraham let the Committee know “the hard work is what you face now.” At Alliance we intend to keep advocating and pressing our governments at all levels to take the steps necessary to ensure no Minneapolis resident lives in housing insecurity or homelessness.
