A boost for affordable housing

Ramsey County and the city of St. Paul are making good use of federal American Rescue Plan (ARP) funds by investing just over $74 million to house lower-income residents. That commitment is one of the largest uses of federal relief dollars for affordable housing in the nation.

Under a plan announced this week, city and county leaders say they will each commit about $37 million to the effort. The investment will pay for construction of 1,000 permanent affordable units in St. Paul at 30% area median income (AMI) — about $34,000 a year for a family of four. Nearly 40% of St. Paul renters have incomes at or below that level.

In Ramsey County overall, more than 37,000 families live at or below 30% AMI, according to county officials. The funds are expected to support about 300 new and existing units in suburbs including Maplewood, Shoreview and Roseville. And though county leaders estimate that about 15,000 units are needed, creating 1,000 new places to live will make a significant difference.

This major government investment in affordable housing is especially needed in today's hot Twin Cities housing market. Many of the properties that might have been affordable for lower-income people are being purchased by national or international investors as rental properties or to flip quickly for profit. That trend has in some cases decreased availability.

Government assistance is essential to create new housing and to drive the partnerships necessary to build new units or preserve existing units. It's also necessary because the new St. Paul rent control measure is likely to stop some developers and landlords from offering units with less expensive rents.

Ramsey County Commissioner Trista MatasCastillo said despite concerns about rent control measure, there is already interest from local developers in getting some of the federal funding to create affordable units.

"To have this large of an investment at the local level is really going to be a springboard for our community," MatasCastillo said. "It has gone unfunded for so long that we are in a crisis and now we have the opportunity to actually address it, and to make sure that every member of our community has the opportunity to have an affordable, safe, dignified place to live."