4d Affordable Housing Incentive Program
The City of Minneapolis is seeking public comment on guidelines for the proposed City of Minneapolis 4d Affordable Housing Incentive Program. The proposed program builds on the City’s 4d Pilot Program, which preserved 207 units of naturally occurring affordable housing (NOAH) through commitments that owners made to the City in May 2018. Comments on the proposed guidelines for the new program are due no later than Sunday, October 21, 2018 and can be sent to: Dean Porter-Nelson, Housing Stability Specialist, 612-673-5237.
Additional benefits for program participants
Updated eligibility guidelines
Updated process and program requirements
4d Pilot Initiative
In April 2018, the City Council approved a pilot program enabling owners of naturally occurring affordable housing (NOAH) in Minneapolis to utilize a State provision called 4d, also known as the Low Income Rental Classification (LIRC). that Minnesota’s 4d provision reduces property taxes by 40 percent on rent restricted housing units that are affordable to households making 60% or less of area median income (AMI). Ten property owners participated in the Minneapolis 4d Pilot, and each owner signed a commitment to keep at least 20% of units in their buildings affordable for 10 years. In total, the Minneapolis 4d Pilot helped preserve the affordability of 207 homes. Eligibility guidelines
Owners of market-rate multifamily properties that meet the following criteria:
- At least 20% of the rental units in a building are occupied by and affordable to households whose income is at or below 60% of the Area Median Income.
- Buildings with at least 10 rental units.
- Income qualification is determined upon initial occupancy. Thereafter, increased incomes of tenants in affordable units will not violate the program requirements.
- Existing tenants in units that have program compliant rents do not need to be income qualified.
- Buildings can include units with owner occupants, but only rental units are eligible for 4d tax status.
- Tier 1 or 2 rental license with no rental housing license revocations or outstanding housing orders.
What are the benefits to participants?
Qualified building owners that agree to keep a minimum of 20% of units per building affordable to households making 60% of Area Median Income (AMI), for ten years, will receive: 40% property tax reduction on qualifying units (Low Income Rental Classification, also known as “4d property tax classification”)
Additional benefits include:
- Payment of first year application fee to the State of Minnesota for certification of the 4d property tax classification ($10/unit)
- Free energy efficiency and healthy homes assessments available to buildings with 5 or more units.
- City subsidy and utility rebates offered for the cost of energy efficiency and healthy homes improvement identified in the free assessment
- Reduced renter turnover
- Lower maintenance and operating costs, if owners take advantage of opportunities to make energy efficiency improvements to properties
The deadline for the participation in the 4d Pilot Initiative was May 2, 2018.
For More Information?
Owners of apartment buildings in Minneapolis should contact Dean Porter-Nelson via email or at 612-673-5237 to learn more about the 4d Pilot Program and the proposed 4d Affordable Housing Incentive Program.
Last updated Oct 1, 2018