Don’t believe the hype. This article from MN Reformer is a PR piece designed to mislead. The city and MPHA claim they lack funds to repair Section 9 public housing, yet they find public funds to privatize these properties as they claim to make repairs, as seen with the Elliot Twins. Now, the Manor building is the latest Section 9 building set for privatization under the RAD (Rental Assistance Demonstration) program, pushed by the Mayor and city council.
RAD, a federal program lobbied for by the Minneapolis Mayor and City Council, shifts ownership from public to private hands. When the Mayor or city officials use terms like “deeply affordable” housing, they mean privately owned units, not true Section 9 public housing. Over the past two years, city-endorsed policies have led to the privatization, demolition, and displacement of over 736 public housing single-family homes known as scattered sites, using HUD’s Section 18 Demolition & Disposition alongside RAD to facilitate this shift from public to private.
This article misleads by using the term “public housing” in its title but then referring to “affordable” housing—affordable for whom? Section 9 public housing properties are being demolished, rents are rising, and low-income families are displaced, as seen at Elliot Twins. Yet, the Mayor, Rainville, and MN Reformer want you to believe that the Manor building will remain Section 9 public housing, even though it’s being privatized through RAD.
Additionally, they claim that 15 new Section 9 units are being built. In reality, these units are not public housing—they are “affordable” units with market-rate rents, controlled by private entities under the guise of affordability, benefiting developers, banks, and corporate nonprofits, not low-income families.
Ask your council members—especially those endorsed by TC DSA who pledged to halt RAD and Section 18—why they are allowing these programs to privatize, demolish, and displace low-income families, seniors on fixed incomes, and people with disabilities across Minneapolis right now.
On Wednesday, June 4th, 2024, The Heritage Preservation Commission (HPC) of the City of Minneapolis unanimously approved the nomination to designate Glendale Townhomes as a historic district. This is the second time the commission has approved this nomination, as the previously approved application from 2020 expired. Both times, the Community Planning & Economic Development ( CPED) and Minneapolis Public Housing Authority ( MPHA) recommended a motion for the HPC to deny the nomination. Here is CPED recommending HPC to vote no under item #7 of the June 4 agenda. It is interesting to compare this to the 3 other private properties on the agenda that CPED recommended yes for historic designation. These are single properties mainly vacant in the North Loop. At the same time, CPED recommended no for Glendale’s historic designation. Even though Glendale is the only Section 9 public housing with 184 properties- townhouses with a 5 to 7-year waitlist.
During the June 4th Heritage Preservation Meeting/ Presentation, from 1:17:37 to 1:29, MPHA representative Mr. Brian Schaffer uploaded a PowerPoint by MPHA and CPED that listed reasons why HPC should deny the nomination to designate Glendale Townhomes as a historic district. Please note that if Glendale becomes a historic sight, MPHA will face barriers to demolish it. MPHA and CPED said: “There are better ways to preserve history than designation.” They give no consideration to the families that Glendale houses. During the preservation meeting (timestamp 1:26:39), MPHA used an image from the Glendale Exhibit’s Oral History Interview (timestamp 20:24), created by Defend Glendale & Public Housing Coalition (DG&PHC) to show that they want to preserve the history while MPHA wants to displace its low-income families and children. MPHA demonizes, slanders, attacks, and intimidates the Glendale tenants that founded & run DG&PHC along with mainstream institutions and politicians. Yet they continue to use our work. It is difficult to comprehend why MPHA would use our labor on this exhibit and then manipulate it to justify why they should demolish Glendale Townhomes. Using the labor of the exhibit team, such as current and former Glendale tenants, volunteers, and MN Transform AGAINST, what we are advocating for is not just callous but also condescending, classist, and racist.
MPHA, STOP using our work.
If MPHA truly cared about “amplifying and supporting” the story of Glendale, they would have long ago.
MPHA’s approach of putting the onus of preservation work on residents and organizers through storytelling rather than the historic designation mechanisms put in place by the City shows that the Minneapolis political leadership does not value Section 9 public housing. This local history work is our way of advocating for the protection and preservation of the Glendale community and all Section 9 public housing communities at risk of being demolished and displaced for profit.
We will not allow Glendale to be an afterthought written in history books as a displaced community.
Minnesota’s current information page for its POHP funding program
Last year, the Minneapolis Public Housing Authority (MPHA) justified its million dollar request to the Minnesota state legislature by pointing out that it can no longer draw on financing from the state’s Publicly Owned Housing Program (POHP) to renovate many properties it maintains. POHP is a dedicated state funding source for public housing authorities to use. MPHA is the state’s largest public housing authority.
This fact sheet addresses how MPHA went from being the State’s most successful recipient of POHP to unable to take advantage of this funding. MPHA’s history of transferring public housing into private hands is limiting MPHA’s access to funding sources, risking the long-term sustainability of its model.
To understand MPHA’s current POHP predicament, it’s necessary to explain POHP’s history and how it operates. In 2005, the Minnesota state legislature created the Publicly Owned Housing Program (POHP) for renovating and preserving public housing units in the state. POHP funding can only be applied to the renovation of low-income public housing – housing that, as per Section 9 of the United States Housing Act of 1937, is operated by a municipal or regional Public Housing Authority (PHA). This means that POHP funding cannot be used to renovate housing that MPHA privatized and converted to the Section 8 Housing Choice Voucher program. While Section 8 rent is publicly subsidized, it is not publicly owned. It is owned by private landlords and non-profit corporations.
POHP distributes funds via a Request for Proposal (RFP) process, which is highly competitive. Once funding is provided, it can be allotted to a wide range of renovation needs. The funding is provided as a zero interest loan and is typically forgiven after its 20-year term.
POHP offers MPHA zero interest loans specifically for funding public housing renovation.
MPHA presentation to the MN state legislature stating that it cannot use POHP funding for CHR-held properties
In recent years, MPHA has highlighted the need for significant renovation. Why isn’t the agency drawing on such an obvious and accessible source of funding as much as possible? This contradiction becomes even starker when one realizes just how much MPHA has used POHP money in the past. Over the past decade, MPHA has received about $12.3 million in POHP funding from the state to renovate public housing. MPHA is so well versed in POHP policies that in 2020, MPHA’s own Community Update confidently stated that
Since its creation in 2012, MPHA has been the state’s most successful user of POHP grants to address essential capital repairs…. MPHA will continue to apply for this essential program to preserve our highrises, most of which are now more than 50 years old.
Despite this familiarity with POHP, MPHA has undertaken the privatization of public housing – rendering huge portions of its portfolio ineligible for POHP funding. Specifically, it has used two federal programs – Rental Assistance Demonstration (RAD) and Section 18 Demolition and Disposition – to convert its high rise and scattered site Section 9 public housing into privately owned “deeply affordable” housing that is subsidized by tax dollars. This resulted in displacement of residents and high rents. The POHP program overview explicitly states that housing converted through RAD is not eligible. In other words, by privatizing housing and transferring ownership to its subsidiary nonprofit Community Housing Resources (CHR), MPHA deliberately limited its ability to use POHP funding. Now, MPHA complains about its inability to access POHP, as if the legal barriers were not a consequence of the agency’s own decisions.
In addition to sacrificing access to future POHP funding, MPHA’s privatization agenda may result in additional costs associated with previously disbursed POHP money. While MPHA typically refers to POHP funds simply as “loans,” in its March 2022 Board Packet, MPHA stated, “the loans have a term of 20 years and are forgiven and extinguished with no repayment required if the MPHA continues to operate and manage the developments as public housing for public housing residents.” In other words, these are effectively grants and only become loans if MPHA decides to privatize the properties. This is meant to provide an incentive to maintain the properties as public housing. Did MPHA have to repay “loans” which would have been forgiven had they maintained their public housing status?
Another reason MPHA may be less reliant on POHP going forward is that PHOP requires that each housing community have a concrete relocation plan, which is something MPHA failed to do for its residents during the RAD conversion of the Elliot Twin High rises. MPHA’s “relocation plan” for Elliot Twins did not provide a timeline for relocation, asked residents to move in with friends and family, and contradicted itself several times about whether residents would even have to leave the building during renovation. All of these actions violate the relocation requirements for projects funded by POHP.
MPHA’s failure to meet POHP’s relocation requirements may be another reason that MPHA has deliberately limited its access to POHP funds. Was MPHA trying to avoid accountability by making their housing ineligible for POHP? Perhaps MPHA assumed that the private sector cash that would flow in once units had been converted to private housing would eliminate the need for POHP funds. Either way, MPHA’s current complaints about being unable to draw on POHP and their hinted plans to lobby to alter POHP to cover privatized housing suggest that this the gamble did not work out. Instead, by privatizing, MPHA blocked the opportunity to access unlimited state funds.
Meanwhile, they say they are $31 million dollars behind in repairs. This is the contradiction at the core of MPHA’s current approach to housing policy: they deliberately deny themselves access to public money and then refuse accountability.
MPHA’s photo of the celebration following the levy’s passage
Last week, the Minneapolis city council council’s passed a $5 million annual property tax levy intended to fund construction and renovations of housing operated by the Minneapolis Public Housing Agency. The city council’s passage of the levy follows a months-long campaign by Mayor Frey, several council members, MPHA CEO Abdi Warsame, and the Minneapolis Board of Estimate and Taxation, which had to approve the levy before it went to the council.
While ostensibly, more money to MPHA should mean more money invested in public housing, MPHA’s approach to housing renovation over the last decades suggests otherwise. DG&PHC has questions and concerns about the tax levy. We doubt that the $5 million will be used to make repairs because MPHA has failed to use previous public funds windfalls for repairs. For example, in 2019, MPHA received a 45% in HUD spending, and continued to pursue the path of privatization, letting buildings fall into disrepair until privatized. This is called demolition by neglect in the housing field.
We have noticed that as MPHA reduces the public housing stock yearly, they continue to lobby for more funds, all while repairs get delayed. MPHA has a long history of using funds as they wish because for decades, they have enjoyed MTW status. MTW means HUD ceded its supervision of MPHA to the City of Minneapolis to have more local and community control. As a result, MPHA has enjoyed more autonomy to try out pilot projects such as privatization. In theory the City would monitor MPHA’s actions, from creating pilot projects to appropriating funds. But, in reality, there has been no oversight, monitoring, or audits by the City of Minneapolis for decades. The City still fails to hold MPHA accountable. This levy will be more of the same regardless of the political optics.
MPHA’s actual stock of Public Housing, defined by Section 9 of the Housing Act of 1937, has dwindled over the decade as MPHA has exploited MTW status to aggressively privatize housing. The latest privatization program MPHA used was Rental Assistance Demonstration (RAD) which allows PHAs (Public Housing Agencies) to convert public housing into “affordable” (or as Mayor Frey says), “ deeply affordable” private housing. MPHA used RAD to privatize the Elliot Twins highrises in 2018 and sold the two buildings to the Royal Bank of Canada. The second federal program MPHA used is RAD’s sister Section 18 Demolition & Disposition, which transferred ownership of all 736 scattered site single-family homes to its nonprofit, Community Housing Resources (CHR). Instead of selling the houses to the families living there, MPHA sold the homes to CHR for $1 each. This is the latest iteration of a decades-long patter. In 1999, MPHA used HOPE VI to demolish 770 units of townhomes and highrises located in the old Sumner Glenwood Neighborhood in North Minneapolis – at the time the largest public housing development in the city.
Through Section 18, residents have reported increased rents and fees, confusing leases, and evictions. Residents also said they were pressured to move out by MPHA and were offered Section 8 Housing Choice Vouchers to look for other housing in this market. Section 8 is a subsidy for private landlords and non-profit corporations to rent to low-income families, but nothing stops the landlord from increasing rents. Section 8 rents themselves are not fixed at 30% of income like Section 9. Additionally, after privatization through RAD and Section 18, nothing stops the developers, banks, and landlords from increasing fees and rents.
Why didn’t the City pass a tax levy years ago, before privatizing Section 9 Public Housing through Section 18 or RAD?
In 2016, when DG&PHC advocated bringing back the old tax levy for MPHA, which the City used before 2010 to meet the funding gaps and stop RAD privatization, public housing residents were told there was insufficient political capital for a housing tax levy in Minneapolis, and thus preserving public housing was impossible. Now that over 736 single-family homes (scattered sites) and the Elliot Twins have been privatized, and MPHA has plans to convert more highrises with RAD to end public housing, the political will has suddenly materialized.
During his recent public relations bonanza, Mayor Frey spoke of the need to “invest” in public housing, all while advancing policies that hand over the city’s public housing stock to nonprofit corporations, banks, and real estate developers. Notably, 2023 was an election year for the city council, suggesting politicians saw the entire levy passage process as a photo opportunity without any accountability or transparency. If Minneapolis City Council were serious about protecting and expanding Section 9 public housing, they would stop RAD and Section 18 now and protect residents from displacement and gentrification.
Given all of this, neighborhood organizations have the following questions:
How will MPHA spend the levy?
What are the scope of services funded by the levy?
What properties will receive the repairs?
Is there a legally binding document between the City of Minneapolis and MPHA that outlines the needed repairs the levy will address?
Will the City hold MPHA accountable to submit quarterly reports to explain how the levy is spent?
Will the City of Minneapolis enforce Chapter 420 to hold MPHA accountable on how they spend funds?
Why won’t the progressive city council members pass a resolution or ordinance to stop RAD and Sections 18 privatization, since it is now easy to pass a levy?
Jacob Frey speaks at the Public Housing Preservation and Expansion Convening press conferences with MPHA CEO Adbi Warsame behind (source KSTP)
On March 10th 2023, Jacob Frey convened a press conference at the Minnesota State Capitol about expanding housing affordability in Minneapolis. He chaired the Public Housing Preservation and Expansion Convening and included a classic list of Twin Cities governmental entities and NGOS including the Metropolitan Council, The Pohlad Family Foundation, The Minneapolis Foundation, The McKnight Foundation, Minneapolis Public Schools, and Minneapolis Highrise Representative Council. According to Frey, by bringing together “elected officials, community leaders, and housing experts,” the Convening exemplifies the “best way” to expand Minneapolis’ “public housing stock”.
Interestingly, the keystone of the convening was House File 2477, state legislation that would have initially granted $45 million for the Minneapolis Public Housing Authority (MPHA) to renovate and build more “affordable housing units”. Frey claims that the $45 million grant would go towards current public housing units, benefitting 31,000 families and building new units for future families.
However, as with all things rolled out by Frey and Minneapolis’ DFL politicians, the devil is in the details. This report highlights two important contradictions in the city’s housing policy. First, when Twin Cities politicians and their friends in real estate talk about expanding public housing, they are usually talking about privatizing it and replacing it with so-called “deeply affordable housing”. This explains why the two terms – public housing and “deeply affordable housing” – were used interchangeably in Frey’s convening and the subsequent discussions about House File 2477 in the Statehouse. And second, that very privatization itself explains why Jacob Frey has to put on a massive “convening” just to ask for more money from the State of Minnesota to fund his own city’s “housing” plans which is privatizing public housing therefore ending public housing as we know it.
Deeply Affordable Housing Is Not Public Housing
House File 2477 itself does not mention public housing, contradicting Jacob Frey’s claim of wanting to “expand public housing”. Instead, the bill language refers to public housing units as “deeply affordable family housing units.” This contradiction between the labeling of the exact same units as “public housing” by the press but “deeply affordable housing” by the politicians themselves highlights the true nature of the goals of the Minneapolis Public Housing Authority and the city’s politicians.
First, “deeply affordable housing” and “public housing” are not the same. In Minneapolis, truly public housing is owned by the public, it is a public good and operated by government agency MPHA (Minneapolis Public Housing Authority), but “deeply affordable” housing is not actually owned by the government. This is apparent the moment one examines the fine print of HF 2477. The $45 million that MPHA initially asked for will not go directly to MPHA for its own public housing stock but to Community Housing Resources (CHR), a nonprofit that MPHA created.
Actual text of HF 2477
Since 2018, MPHA has offloaded its entire stock of over 736 scattered sites single-family public housing to CHR through the Section 18 Demolition & Disposition Conversion process. This process allows public housing authorities to transfer ownership of housing from the government to a private sector landlord. Once converted, this housing is no longer public housing.
On the surface, “deeply affordable” housing appears similar to public housing. Housing is considered deeply affordable by HUD and most municipal agencies if it is “affordable” to someone earning under 30% of the Area Median Income (AMI). Affordability in this context means that rent itself does not surpass 30% of a resident’s monthly income. Similarly, Residents earning 30% or under of AMI are eligible to live in public housing and they pay no more than 30% of their actual earned income in rent and fees to MPHA.
Because of these similarities, it would seem that public housing residents and those dwelling in “deeply affordable family housing units” would enjoy similar experiences. This narrative, which MPHA regularly pushes, obscures some important details. Because the “deeply affordable” definition applies to rent but not other charges, residents whose homes have been converted pay higher fees and maintenance charges than before. These fees are added to the monthly rents and if the tenants don’t pay then they face eviction. Going forward, there is no guarantee that rent itself will stay the same at 30% of income because CHR residents do not enjoy the same legal protections as public housing residents.In fact, landlords are free to change rent itself for housing subsidized through Section 8 while the voucher may stay constant, leading to volatile and unpredictable out of pocket-costs year to year. Without a legally binding document or policy that will keep CHR under the supervision of MPHA, in a few years CHR could have a private board and investors who will profit from the 736 scattered sites formerly operated under Section 9 public housing.
The details of MPHA”s Family Housing Expansion Project (FHEP) illustrate another important truth about “deeply affordable” housing in Minneapolis. FHEP is MPHA’s name for the Section 18 Demolition and Disposition of 16 specific scattered site homes. The project will replace the homes with modularly constructed fourplexes, resulting in smaller apartment units unable to house the same large, multigenerational families that lived there before. Because of this, families may not qualify to come back after conversion because their household size is too large and they will need more bedrooms. By making the new privatized units smaller under the Family Housing Expansion Project, MPHA is pushing out large size families who are majority people of color, and who have been on waitlist for 5 to 7 years to live in public housing.
Artist’s rendering of new fourplexes occupying the same space as a previous single-family scattered site home (source MPHA)
Between high fees, high rents, opaque rental policies, smaller new units, and more expensive rent per square foot, “deeply affordable” housing is more expensive than public housing.
Privatization Sacrifices MPHA’s Ability to Use Traditional Funding Sources
MPHA has justified its disastrous use of Section 18 and Rental Assistance Demonstration (RAD) – Section 18’s equivalent program for high-rises – by pointing out that once privatized, it can more easily draw on federal tax credits and private sector cash to fund construction and maintenance. But ironically, MPHA also cites the fact that so much of its housing stock is owned by CHR to justify why it needs more cash from the state. The State of Minnesota operates a special fund for public housing rehabilitation called the Publicly Owned Housing Program (POHP). Typically, public housing authorities across the state apply for 20-year deferrable and forgivable loans through POHP. However, as MPHA pointed out in their presentation to the state legislature, because all of the scattered sites are now owned by CHR, MPHA cannot apply POHP funding to their maintenance.
It is clear that privatization has little to do with ease of funding. By privatizing the scattered sites, and highrises like Elliot Twins, MPHA sacrificed its ability to draw from a key source of public funding. While some private sector cash has flowed in following privatization, it clearly has not been sufficient if MPHA needs to ask the state for an additional $45 million. MPHA portrays RAD and Section 18 as “best practices” for public housing management, but in reality they are only “best practices” for the continuous eradication of public housing across the city. In the long run, CHR burdens residents with fees and forces them into smaller apartments since 1 out of 5 families may come back if they are lucky, while benefiting developers who hope to buy out the buildings.
MPHA’s Disregard for Public Housing Residents is Consistent as it Gambles with the Future of Public Housing
Since 2017, MPHA has increased its yearly repair budget from HUD from $10 million to over $14 million. On top of this, it receives $2 million annually from the state. At the same time, MPHA claims it needs an additional $31 million for repairs for the scattered sites alone, failing to identify a time frame for the budgetary estimate and conveniently leaving out the existing funding from the public sector in its PR. Where does this $31 million “estimate” come from and why isn’t MPHA simply using two years of $16 million in public funding to fix the repairs? In the past, MPHA’s previous capital backlog could be eradicated by existing public sources.
This apparent fiscal dilemma served as the major justification for HF 2477 at Frey’s convening. Since then, HF 2477 had one hearing in the House of Representatives after it was introduced by Representative Ester Agbaje and was introduced in the State Senate by Senator Omar Fateh. The bill was added to a Housing bill package, or an omnibus, where the ask has been reduced to $20 million, not enough to meet MPHA’s initial ask. As of late last month, it is unclear if the bill will gather enough support by the end of the legislative session.
Ultimately, scattered site residents are losing from this whole process. MPHA privatized their homes and handed the properties over to CHR, which exploited the subsequent change in legal requirements to hike up fees and remove long-term housing security guarantees. When MPHA decided to convert the housing through Section 18, it eliminated its own ability to use POHP funding, sacrificing an important financial resource. Now, it is facing an uphill battle to secure alternative public funding sources, no matter how many nonprofits and foundations Jacob Frey packs into a room. Meanwhile, residents continue to lose as their homes fall into disrepair and face the risk of being displaced due high rents that is more then 30% of their actual income.
On January 12th, 2023, a familiar cast of characters gathered to celebrate the groundbreaking of Minneapolis Public Housing Authority’s Family Housing Expansion Project (FHEP). Mayor Jacob Frey and Senator Tina Smith joined MPHA Executive Director Abdi Warsame to extoll the benefits of safe and “affordable housing” as they detailed plans to replace 16 public housing scattered sites single-family homes with modular fourplexes. The laudatory and celebratory tone of the press conference is not new. Most of the press coverage since the announcement of the FHEP has generally celebrated the project as “more public housing coming to Minneapolis.” Unfortunately, this is categorically untrue. The FHEP definitely involves converting public housing to housing leased through the private market. Over the last year of careful on-the-ground research and document analysis, Defend Glendale, and Public Housing Coalition (DG&PHC) has uncovered key details about the FHEP, its funding sources, and likely implications on the future of public housing in the city.
It is first necessary to provide a brief history of Minneapolis’ management of “scattered site” public housing.For decades, MPHA operated over 736 single-family public housing homes rented to large low-income families, each paying 30% of their income for rent and utilities. The scattered site public housing units are in high demand, and it takes 5 to 7 years to get off the scattered site waitlist because the homes are in high demand. MPHA states that 7500 people are on a wait list. The City needs to build more public housing especially single family public housing homes that allows large families to live affordably and with dignity. Currently, the families that live in Minneapolis scattered-site public housing homes are all poor/low-income and predominantly Black, Black immigrant, and Brown.
Despite the scattered sites’ importance and popularity, since 2018, MPHA and the City of Minneapolis have claimed that homes must be privatized through Section 18 Demolition & Disposition Conversion. This type of conversion is a process approved by the City of Minneapolis and HUD that allows Public Housing Authorities (PHA) to transfer ownership of single-family public housing units to private sector entities. With the permission of the City of Minneapolis, MPHA, Mayor Jacob Frey and former Council Member Lisa Bender lobbied HUD to allow MPHA to use Section 18 Demolition & Disposition to privatize and extract the homes from the public housing stock and transfer the ownership of the homes to its own private “nonprofit”, Community Housing Resources (CHR). As a nonprofit without any legal obligation to the general public, MPHA’s claims that CHR is an accountable public entity “wholly owned and operated” by MPHA are ludicrous. After Section 18 Conversion, rent is subsidized through Section 8 vouchers rather than fixed at 30% of residents’ income under Section 9 (Public Housing). Because of this, MPHA claims displacement should be minimized.
The Minneapolis City Council’s unanimous passage of the Minneapolis 2040 plan in 2019 further expedited MPHA’s plans to privatize the scattered sites. Minneapolis 2040 involves the elimination of single-family zoning across most of the city by the year 2040. Unfortunately for scattered site residents, this means that the public lots their houses are built on will be soon upzoned, and sold meaning that the homes will be torn down and replaced with apartment buildings that are more expensive and smaller units, usually four-plexes. Although full implementation of the 2040 plan has been in and out of the Hennepin County Courts, the damage to public housing residents is still done.
The Family Housing Expansion Project is simply the name Senator Tina Smith, the City of Minneapolis and MPHA have given to the latest wave of ending public housing like scattered site privatizations through Section 18. What differentiates these conversions from previous conversions is the combination of 16 conversions at one time and the replacement of all 16 homes with new, cheaply constructed “modular” apartment buildings with small-size units.In July 2021, FHEP was granted $4.6 million by the City of Minneapolis and the demolition process began in the Fall of 2021, when MPHA told residents they would soon have to leave, offering no formal guarantee of relocation. Most recently, the FHEP was granted another $1.4 million by the Metropolitan Council, followed by the Minneapolis City Council BHIZ Committee issued a bonding bill. By summer of 2022, all 16 homes had been vacated. Virtually all governmental entities in the Metro area had rubber stamped the project, upholding MPHA’s narrative that the project would cause “no displacement” and that “residents would be able to move back in” once the new buildings were completed. This is false.
As usual, MPHA’s narrative does not hold up to scrutiny. Over the last year, we visited the 16 scattered site addresses slated for conversion a few times. By the summer, homes that were previously occupied showed signs of abandonment. For example, in the backyard of one scattered site home, we found most of the previous residents’ furniture and kid’s tows thrown in a pile. This suggests that relocation was not as smooth and painless as MPHA promised. Displacement is a traumatic experience, especially considering that some families reported having just moved into their scattered site only a few months before the initiation of the FHEP.
Before demolition, residents we talked to expressed concern that the new apartment units would be too small to fit their families. The appeal of scattered site housing is space for large families, and many scattered sites have a yard, porch space, and a storage shed, along with the multiple bedrooms and bathrooms necessary to house large multi-generational families.. This space will be eliminated as the replacement units will be smaller than the homes previously occupying their lots, according to the Met Council. In the place of these homes, MPHA and a private contractor are erecting buildings that are composed of four prefab pods placed together like a Lego set. Residents’ fears are entirely justified, especially considering that MPHA and its affiliated nonprofits typically use apartment square footage to cap the number of people able to live in a unit. The City of Minneapolis and MPHA wants the public to believe their lies despite obvious holes in their narrative. How can families come back to small units that they can’t legally live in due to occupancy caps?
Finally, the Section 18 conversion process inherently privatizes public housing, meaning that many of the guarantees and legal protection made to public housing residents dissipate. Once public housing has been privatized, there will be no long-term affordability to guarantee the new apartments will be 30% of the tenant’s income for rent, including utilities. Ownership structures become confusing and opaque and it becomes harder to hold landlords accountable.Instead of dealing with MPHA directly, residents’ landlord will (at first) be yet another bizarre nonprofit entity – this time called Family Housing Resources (FHR). Of course, MPHA claims that because FHR – just like CHR – is” wholly operated” by MPHA itself, residents will experience no change.
The Section 18 conversions of scattered sites before the FHEP show the real story. Because CHR has no accountability to the general public, it is allowed to profit from the displacement of poor, and disabled families. The new leases residents were forced to sign after Section 18 conversion no longer guaranteed the 30% of income for rent and utilities that are guaranteed under public housing. Instead, MPHA and the City state that rents and fees will be adjusted in the future, under the auspices of “rent reasonableness”. Nothing is stopping CHR from increasing rents and making the units unaffordable to the median household in Minneapolis public housing, whose income was $10,758 in 2021. Other residents whose homes were converted before 2022 say that they were hit with confusing fees in their rent and increasingly neglected maintenance requests, causing most units to be unlivable. Some residents faced eviction because they could not pay rent. In some cases, these conditions escalated to the point where residents moved out of their units and used the Section 8 vouchers to find other housing, pushing them out of their community and city.
The story of the Elliot Twins – two former public housing buildings in Ward 6 – also illustrates what we can expect from FHR’s management of the 16 new modular buildings. The Elliot Twins were privatized through HUD’s Rental Assistance Demonstration program – the analogue to Section 18 for highrise buildings. Similar to scattered site residents whose homes MPHA previously converted through Section 18, MPHA lied to, harassed, and intimidated Elliot Twins tenants, many of whom were eventually displaced and forced to take Section 8 Vouchers. No one knows what happened to these tenants.
After the Twins’ conversion, MPHA used its typical tactic of creating shell organizations (like FHR and CHR) to manage the property and oversee leasing. However, the land underneath the two buildings was sold to the Royal Bank of Canada, with additional construction capital from Bremer Bank. These investors are now profiting from Elliot Twins by exploiting federal low-income housing tax credits and large amounts of affordable housing funds from the state, county, city and HUD. Its possible that FHR could simply sell off the new modular units to a private financial institution once the FHEP finishes up next December. We expect similar results as FHR takes over the new modular buildings and the FHEP finishes up next December.
Ultimately, the FHEP is just one part of MPHA’s plan to eventually destroy all 736 scattered site homes so that the public land they formerly sat on can be leased to developers for profit. The plan to end public housing and displace low-income Black and Brown families was hatched by so-called “progressive” politicians whose end goal is to enrich their friends in finance and real estate, including so-called “nonprofit” developers. As the city dismantles public housing in the midst of a housing crisis, Black and Brown neighborhoods gentrify. And, the resulting skyrocketing rents and tax credits enrich developers. All the while, nobody from the city has been able to answer the most important questions:
What happens to the families displaced and forced to move out?
Will these families be on a waitlist at local shelters?
Where will they sleep?
What will happen to the schooling of their children and stability?
Will these families add to the number of families seen daily living in their cars or encampments that Mayor Frey and his police force constantly destroy?
We are currently looking to expand capacity within our coalition as we continue the fight against the mass privatization of public housing that is taking place in Minneapolis and beyond and demand public housing for all. Educating the community is a crucial part of the organizing work we do in Defend Glendale & Public Housing Coalition (DG&PHC); the coalition is seeking more volunteers who can help us with research and/or communication to join our collective effort!
Defend Glendale & Public Housing Coalition is a public housing resident-led grassroot group made up of public housing tenants, subsidized housing tenants, and allies united on a set of goals to: organize the fight against the mass privatization of public housing across Minneapolis (also happening on a global scale), expand production of public housing for all with democratic tenants control, and provide knowledge sharing tools for the people to gain deeper understanding of the privatization of public housing that exacerbates the housing challenges low-income families are facing. The bureaucrats have restructured policies to ensure housing remains one of the core assets within the financial capital domain in which real estate private investors can accumulate profit, thereby making housing more inaccessible to low-income and working class families.
Formal experience in the following is not required, but would be helpful. If you already have keen interest in housing justice and find yourself wanting to dig for truth about how the housing system operates, then that is a great start!
We are currently in search of:
Research Volunteers
Searching for appropriate data, reports, and literatures that help us gain deeper understanding of the systemic issues we are facing
Good understanding of the housing and public housing crisis we face nationally & in the Twin Cities.
Analyzing data, reports, and policies based on findings
Good with numbers, charts, & stats
Writing a short article to be shared publicly
Communications Volunteers
Producing short written contents for social media posts
Making graphics to go with the written texts. We’re open to all sorts of visual mediums that can be used for social media (ie: photography, illustration, video, etc.)
Updating website with new information
Managing social media
Please fill out this google form to express interest in getting plugged into DG&PHC. Someone from the coalition will follow up with a brief introductory orientation.
If there are other ways you would like to contribute your skills to Defend Glendale & Public Housing Coalition that are not listed above, then please indicate how you might want to get involved using the same google form at the link above!
Thank you in advance and please do share this with other folks you know who you think might be interested!
New Chairman of Minneapolis Public Housing Authority (MPHA)
Tom Hoch, a Minneapolis business magnate and the previous CEO of Hennepin Theater Trust, has assumed the position of Board Chair of MPHA. Mr. Hoch served as MPHA’s Deputy Executive Director throughout the 1990’s – a period marked by displacement, demolition and the accelerated privatization of Minneapolis’ largest low-income housing system. As Board Chair, Mr. Hoch brings a deep record of working for – and in most cases, leading – agencies and nonprofits that have (1) consistently moved public assets into private ownership, (2) displaced working-class and BIPOC communities and (3) harassed and jailed homeless and Black youth. The below article details Mr. Hoch’s legacy of disinvesting in Minneapolis’ poor and working class, and the danger he poses to these communities.
From 1984 -1990, Tom Hoch served in a variety of roles at the Minneapolis Community Development Agency (MCDA), the municipal agency which previously existed as a combination of CPED and MPHA. Mr. Hoch coordinated the optic – but not legal – separation of MPHA from the City of Minneapolis,1 and became the newly formed public housing authority’s Deputy Executive Director in 1991. Beyond orchestrating the fake separation of MPHA from municipal government, Mr. Hoch oversaw MCDA’s acquisition of Orpheum Theater in 1988 and the State Theater in 1989. The State and Orpheum theaters would make up two of the three theaters Mr. Hoch’s non-profit would assume ownership of in 2005.
Mr. Hoch’s first stint at MPHA ushered in a new era of austerity, displacement, demolition, gentrification, privatization, and increased reliance on HCVs (Housing Choice Vouchers). In 1992, the NAACP, the Legal Aid Society, and 17 plaintiffs sued local, state and federal agencies, accusing the city of intentionally concentrating and segregating working class families into the Near North neighborhoods by constructing many of the city’s public housing units on the northside of Minneapolis. The lawsuit, Hollman vs. Cisneros, alleged that defendants had intentionally perpetuated and codified Minneapolis’ entrenched racist housing system by weaponizing the city’s public housing authority to segregate and disinvest in the city’s non-white communities. Serving as Deputy Executive Director, Hoch negotiated the lawsuit’s settlement. In an attempt to “deconcentrate” the city’s impoverished communities, the resulting consent decree – the Hollman Decree – led to the demolition of 770 public housing units: Sumner Field Townhomes, Olson Townhomes, Glenwood Townhomes and Lyndale Townhomes.2 Only 88 units were built back in city neighborhoods. Under Hoch’s watch, MPHA expediently demolished the 770 public housing units targeted by the Hollman decree, yet intentionally dragged its feet on locating and creating stable and permanent housing for the displaced. Many families whose homes were demolished either relied on the shelter system for temporary housing or experienced prolonged periods of homelessness. Instead of using his power and authority to advocate for deep investment in Minneapolis’ Black, brown and Indigenous communities, to begin the shift away from decades of racist housing policy, Hoch leveled some of the city’s largest BIPOC communities.3 The displacement of people and families to the suburbs pulled them from community ties and necessary supports; stranding families in areas of unaffordability, few employment opportunities,food desert, and stagnant public transportation systems. Of the 17 plaintiffs in the lawsuit, three families became homeless; three were evicted from their relocation property; and two fell out of communication with MPHA.2
In 1996, Mr. Hoch left MPHA to become the CEO of the Hennepin Theater Trust (formerly the Historic Theater Group). Capitalizing off his role at MCDA and the purchase of the Orpheum and State theater’s, Mr. Hoch’s group incorporated as a non-profit in 2000. Within 5 years, the organization had successfully lobbied the city to transfer ownership of these two theaters, and the Pantages theater, to the Hennepin Theater Trust.4 Across his tenure as CEO, Hoch earned over $2.5 million5 — managing three theaters that previously belonged to the city.
During this time, Hoch became heavily invested in the Minneapolis Downtown Improvement District and the Minneapolis Downtown Council.6 Both groups function as de facto pressure mechanisms serving the downtown elite and wealthy business interests. Hoch served as chair of both boards of the two entwined entities from 2015-2017.7 In 2015, the Downtown Improvement District became the predominant stakeholder in the SafeZone project, a massive surveillance program funded by —and operated on behalf of — the Target Corporation.11 SafeZone, a collaboration between MPD, the Downtown Improvement District and a smattering of social service agencies, is a surveillance program targeting “undesirable individuals”, predominantly unhoused individuals and Black youth.9 Its function is to harass, intimidate and police these individuals out of the downtown area. The Downtown Improvement District also operates the DID “Fusion Center,” a vast array of CCTV cameras and radio communications equipment, out of MPD’s first precinct. The Fusion Center’s main purpose is to actively surveil a list of 100 individuals, dubbed the “DT 100” and relay their movements and status to the police department.11 Ultimately, the program targets poor and Black people, continuously leveling charges of low-level misdemeanor crimes and — with the support and complicity of the Hennepin County attorney’s office— imposes geographic restriction orders for the downtown area. The hyper-surveillance of the SafeZone project effectively criminalizes Black and homeless individuals, intentionally enforcing an increasingly hostile and dangerous downtown area for non-white individuals. Of the “DT 100”, 80% are Black or Native.10
There is no indication that the program slowed or changed course after Mr. Hoch became the board chair of the supervising agency. In fact, Hoch repeatedly alluded to the project, or referenced the underlying racist intentions of the SafeZone project, while on the campaign trail for mayor. Hoch expressed concern that low-income or people “without anywhere to go” threatened the “downtown image.” In an interview with MinnPost in September 2017, he articulated his intentions to ensure downtown Minneapolis remained a haven for wealthy and white Minnesotans only: “Some people are there because they don’t have any place else to be. They don’t have any money. They don’t have any place to go and Hennepin and 1st seem like relatively safe destinations. But it doesn’t make the space feel safe.”12
Hoch now brings this elitist, racist vision for the City of Minneapolis to the most powerful position in MPHA. Why should Minneapolis public housing residents, a majority of whom are BIPOC and/or low-income, feel safe, valued and protected when Hoch’s record has been entirely antithetical to their wellbeing?
Tom Hoch clearly operates solely for the benefit of the Minneapolis elite, massive business interests and the wealthy real-estate lobby. Already, it is clear that he intends to use the position to further the shameless profiteering and intentional disinvestment and criminalization of working-class communities in Minneapolis, and specifically Black youth. During his May 5th confirmation hearing, CM Chughtai asked Hoch if he had any plans to expand access to desperately needed public housing in Minneapolis. Hoch replied, “I don’t know if public housing will be expanding as opposed to affordable housing.”13 Hoch then went on to reference Aeon and Commonbond – two predatory “affordable housing” developers – as the solution to the affordable housing crisis, essentially signaling his intention to accelerate the privatization of MPHA’s housing stock under his watch. Hoch represents everything that is a threat to working-class communities’ ability to thrive — and has built his career off of actualizing these threats. The future of MPHA, according to Hoch, is defined by surveillance, privatization, and the consolidation of capital away from public housing residents.
Former public housing unit aka scattered site where low income family were pushed out through Section 18 to make room for Frey’s demolition plans to build expensive ‘ affordable units”.
The Minneapolis Public Housing Authority’s official policy states on page 47 that public housing residents will pay no more than 30% of monthly income on rent, aligning with federal regulations that govern public housing rent computation across the country. This 30% income rent limit also applies to housing subsidized through voucher programs like Section 8. Recently, MPHA and its YIMBY allies paraded this fact when defending the privatization of sixteen Scattered Site units across the city. But this argument glosses over two important caveats. First, once public housing is privatized there is no guarantee that rental rates of 30% of income will continue indefinitely. Second, rent isn’t the only payment one makes for housing. Renters pay all kinds of fees in addition to monthly rent. Frequently, Minneapolis public housing residents see charges of substantially more than 30% of their income on their monthly invoices, a problem that is getting worse as their homes are privatized through the Section 18 Demolition and Disposition conversion program.
MPHA Claiming that residents will always pay 30% of income in rent. This is a false statement.
As a public agency, Minneapolis Public Housing Authority (MPHA) says they don’t charge more than 30% of income in rent. But according to public housing residents’ experiences, MPHA has found another way to financially burden residents through ambiguous fees, greedily taking in even more money from residents who barely can afford 30% of income for rent. For public housing, maintenance costs associated with “normal wear and tear” must be covered by rental payments, by federal regulation. However, MPHA tenants report that unless they specifically state that maintenance costs are due to “normal wear and tear”, MPHA will levy an additional charge. On top of this, the repairs are usually scattershot, creating cycles of ongoing maintenance issues because MPHA doesn’t care about tenants’ health and wellbeing.
This is a bad faith attempt on the part of MPHA to take more and more money from their residents. Using data obtained from MPHA through a data practices request, we have uncovered a troubling trend. Over the course of the pandemic, MPHA has steadily increased the average amount of maintenance charges. Residents pointed out that with children at home using amenities more frequently and attending school virtually, there was a higher demand for maintenance and also higher utility bills. But while other public agencies were providing stimulus, MPHA decided to demand even more money from their tenants.
Increasing maintenance charges during pandemic. Dark blue dots represent average charges at each 2.5 week period
While we will not be publishing specific rental statements specifically because residents already fear harassment and retaliation from MPHA, evidence from residents’ rental statements provides further insight into this troubling trend. These fees have been administered inconsistently and opaquely. MPHA levies additional charges for routine maintenance without providing sufficient explanations for how expected payment amounts are computed. Further, MPHA’s inconsistent and sloppy bookkeeping has led to other inconsistencies. Some residents have reported being billed for the rent of family members who had already moved out. MPHA’s financial practices are opaque and messy precisely because the agency wants to extort as much as possible from its residents. Its goal has been to eradicate and privatize public housing and one way to accomplish that is to punish current public housing residents.
The pandemic coincided with MPHA privatizing and converting many scattered site single-family public housing units into Section 8 housing through the Section 18 conversion process. Despite living in the same house for decades, after Section 18 conversion, some residents were made to pay new security deposits and move-in fees, just because their landlord had changed from MPHA to Community Housing Resources – the nonprofit developer MPHA created to hold scattered site housing on the private market. Additionally, after Section 18 conversion, some residents have been surprised by a fee of over $1,000 dollars named the “PBV HAP Charge”. HAP stands for Housing Assistance Program, a contract that Public Housing Authorities sign with private (sometimes nonprofit) landlords after conversion. This charge appears on resident’s billing statements with no context, and makes little sense. HAP contracts involve PHAs transferring money to landlords, so why is MPHA putting residents on the hook for a contract that they sign with Community Housing Resources or one of their three shell companies?
The ostensible purpose of Section 18 and RAD, according to both MPHA and HUD, is to free up more public funding to cover wear and tear maintenance. However, in Minneapolis, residents remain on the hook for maintenance fees even after Section 18 conversion occurs. In some cases, fees actually increase after privatization. For example, after Section 18 conversion, some residents have reported fees equalling up to 10% of rent for maintenance charges as routine as sink repairs.
Clearly, RAD and Section 18 have nothing to do with supporting residents’ maintenance needs. If that were the case, residents would no longer be subject to maintenance charges after MPHA converted their homes to private housing. Instead, MPHA’s private shell companies continue to charge maintenance fees, and now have no obligation to continue to house residents who formerly lived in public housing. All of this continues to show that MPHA never intended to keep its repeated promises. In this video at the Minneapolis City Council, Housing & Development Committee, on February 5th, 2020, ( @ 13 minutes), Tracy Scott, the former Deputy Director of MPHA lobbied for MPHA’s Section 18 privatization/conversion of over 730 single- family public housing homes ( aka scattered sites). Tracy Scott strongly stated Section 18 Demolition & Disposition will change nothing and there will be no displacement of tenants. Tracy Scott says MPHA needs to convert to Section 18 because MPHA will receive only extra $3 million for needed repairs and maintenance. This is in addition to the 42% increase MPHA received from HUD for repair and wear and tire. MPHA has yet to disclose how this money is being spent. At this time, the Housing & Development Committee was chaired by Cam Gordon and vice chair Jeremiah Ellison. Check out how Lisa Bender and Lisa Goodman supported MPHA’s decision to privatize public housing, and Lisa Goodman stated that the council does not have authority over MPHA which is false. Now, our campaign received messages from public housing families in scattered- sites that went through the Section 18 privatization. They are now being pressured to move out of their units by MPHA staff, and in return MPHA will give them Section 8 Vouchers to look for housing in the private market. In addition to the high maintenance fees and unlawful second security deposits, this is the classic formula to push out low income tenants from public housing. MPHA and City of Minneapolis can demolish the units and build “ affordable buildings” that are not affordable for current.
Unqualified chairman handpicked by unqualified mayor resigns due to personal scandal and stealing public funds. How shocking!!
As a Somali man, his only qualification for the role was to silence and bully Somali public housing residents and cofounder of our campaign who is fighting to stop the privatization of Minneapolis Public Housing. The local media is not talking about the shell companies Frey, Abdi Warsame, and this dude created to sell off public housing properties. It wouldn’t be surprising if they planned to be private developers and landlords of the properties.
