Highlights of Our Work

Twin Cities Metropolitan Area

Motivating Cities to Develop More Affordable Housing HPP has been active in promoting the development of more affordable housing metro-wide, using a variety of strategies. In some cases HPP has represented nonprofit housing groups in fighting NIMBY challenges to the siting of housing. One particularly successful effort involved spearheading a campaign by housing advocates to persuade the Met Council to use its leverage with respect to public infrastructure funding to promote affordable housing. As a result, before dispensing funding to local communities for transportation, parks or sewers, the Council takes into account the community’s performance in developing affordable housing, thus encouraging more such efforts in the future.

Brooklyn Park On Monday, July 10th, 2006, the Brooklyn Park EDA passed a replacement housing policy that will provide a mechanism for replacing affordable housing that is lost as a result of redevelopment projects undertaken by the EDA. The policy will replace units at the same affordability levels as those taken out and must be replaced within five years of demolition.

This policy is the result of two years of advocacy by a coalition of organizations called Communities Active in Redevelopment Efforts. The coalition partners include the Housing Preservation Project, Community Stabilization Project, African American Action Committee, Legal Aid Society of Minneapolis, SEIU Local 26 and residents of the City of Brooklyn Park. In 2004, advocates began organizing the community in response to the proposed demolition of 900 units of affordable housing along the Zane Avenue Corridor. Since defeating a referendum that would have funded this demolition, advocates have been working with the city to get the community a voice when it comes to city-sponsored redevelopment projects. As a result, the city convened a housing task force representative of the community to come up with a plan for redevelopment along the Zane Avenue Corridor, passed a relocation assistance policy in early 2006, and most recently, it passed a replacement housing policy in recognition that affordable housing may be lost as a result of the redevelopment. This latest success is a huge victory for the community and should serve as a model for other cities undergoing similar redevelopment projects.

Capitol Plaza - Burks v. Jackson (D. Minnesota 2003) A federal statute, commonly referred to as section 250, provides that where HUD has authority to prevent owners from prepaying their HUD insured mortgages, HUD must do so. In particular, where a property has been serving as a low income housing resource, HUD must not permit a prepayment. In this case HPP represented several tenants in this St. Paul apartment building where HUD had permitted the owner to prepay in disregard of § 250. When HUD failed to get the lawsuit dismissed, HUD then responded by publishing a new national policy on how it interpreted § 250. Although better than the informal practice it had previously employed, HUD’s new notice still falls short of what § 250 actually requires. Meanwhile, HPP proposed an innovative way to settle the case, producing a "win/win" outcome for both the tenants and the project owner.

LUPA - Alliance for Metropolitan Stability v. Metropolitan Council (Minnesota Court of Appeals 2003) The Minnesota Land Planning Act requires every city in the metro area to plan for its share of the metro area need for low income housing. The Metropolitan Council, however, was advising cities they could satisfy that statutory duty by planning for a level of housing development that would satisfy about a tenth of what each city’s share of the regional need would be. Concerned that this minimizing of housing planning objectives would exacerbate the Twin Cities’ already severe shortage of affordable housing, several advocacy groups, represented by HPP and others, sued the Council and a suburban city for violation of the MLPA. Ultimately the Court of Appeals upheld the Council’s actions, but in the process ruled that the advocacy groups had standing to raise such claims, a ruling likely to be significant for similar groups in future cases.

Oak Grove Towers - Alliance v. Cuomo (D. Minnesota 1999) The tenants of Oak Grove Towers in Minneapolis won a major victory against HUD when they obtained a federal court declaratory judgment in which the judge found that the owners’ Section 8 opt-out notice violated federal law, and that HUD’s refusal to adjust subsidy levels on the enhanced vouchers issued to the tenants upon the owners’ prepayment of the mortgage also violated federal law. The case was brought by the tenants association at Oak Grove Towers in Minneapolis, joined by the Community Stabilization Project, against the U.S. Department of Housing and Urban Development (HUD) and the owners. At issue was HUD’s illegal approval of the owners’ termination of Section 8 assistance at the 228-unit highrise in 1997. Oak Grove Towers has been home to hundreds of low-income people, many of them senior citizens, disabled people, minorities, and families with children. Read the opinion

Greater Minnesota Area

Chestnut Apartments - (12 units, Mantorville) As a result of HPP’s involvement, the Rural Housing Service (the agency in charge of the Section 515 Rural Rental Housing Program) determined that the Chestnut Apartments housing was so needed that the mortgage could only be prepaid if protections for current tenants were put in place. As a result of these limitations and based on previous contacts by HPP with the owner about selling the property to a regional nonprofit, the owner agreed to offer the property for sale to a nonprofit preservation buyer in the area, HPP's ultimate goal. The owner is now in negotiations with a nonprofit and the agency about accepting incentives.

Clover Patch Apartments - (32 units, St. Charles) HPP’s involvement in the proposed prepayment of several other projects led to a finding by RHS that the loss of the housing would negatively affect minority home seekers. Prior to HPP's advocacy, RHS had never found an instance of minority impact in Minnesota. This was critical because the finding of minority impact under federal law leads to the opportunity to preserve the project in the program. HPP helped identify a nonprofit that was interested in preserving this building and also served as a consultant throughout the sales process.

Rolling Heights - (16 units, Byron) This elderly project located in Byron (16 units) was at risk of being converted to market rate housing. HPP, along with a tenant advocate from HOME Line, met with the tenants about preserving their homes. This strategy included attending a city council meeting and asking for their support in preserving this project. HPP also identified a housing authority interested in purchasing this property and encouraged a representative to attend the city council meeting. As a result of this action, the city agreed to pay for half of the appraisal if the owner would agree to sell the project to a preservation buyer. HPP also represented the tenants in an administrative appeal filed by the owner in an effort to overturn the agency’s decision requiring tenant protections upon prepayment. Although the owner prevailed through the administrative process, because of the work done by the tenants, HPP and a tenant advocate, the owner agreed to sell the project, and it now has been preserved through a sale to the housing authority.

Manufactured Home Parks

Grove Street Park - (27 units, Janesville) The residents of Grove Street Park became at risk of losing their homes when the owner gave notice that he intended to close the park. After the attempts of APAC (All Parks Alliance for Change) and the residents to purchase the park were rebuffed by the owner, he proceeded to terminate the lease of the lead tenant involved in the purchase. HPP negotiated a settlement which both gave the residents more time to move out and compensated them for the loss of their homes.

Winjum’s Shady Acres - (17 units, LeCenter) Residents received a closure notice and an unreasonable rent increase. HPP got an injunction preventing the owner from doubling the rent and forced the owner to reissue the park closure statement so that it would be in compliance with state law. Additionally HPP and APAC assisted the residents in their successful efforts to petition the county board for reasonable relocation compensation.

Serpent Lake Park - (12 units, Crosby) HPP was successful in preventing the illegal closure of this park. Working with APAC and the park residents, HPP was able to block the owners attempt to force out residents without issuing a proper notice.

Rainbow Park - (48 units, Hermantown) and Eastgate Park - (27 units, Brainerd) HPP was active in assisting residents and APAC in their efforts to secure relocation funds for the displaced residents.

National Projects

Riverside Coves - Tinney v. Veneman (D. Alabama 2003) Owner of a Section 515 building sought to prepay the mortgage. The owner appealed the agency’s decision which would have permitted prepayment only if the owner agreed to protect the tenants from rent increases. After an administrative hearing with RHS, however, the agency reversed itself and allowed prepayment without any restrictions protecting tenants. Prior to the prepayment being accepted, the tenants sued in federal district court in Alabama, claiming the agency’s decision regarding prepayment violated provisions of the Emergency Low Income Housing Preservation Act (ELIHPA), 42 U.S.C. 1472 (c). The tenants sought a preliminary injunction against the prepayment, and the owners moved to dismiss. After briefing, the case was settled with an order to remand the case back to RHS for an administrative re-hearing. Upon a re-hearing and an administrative appeal, the agency found that the owner was required to protect the current tenants of the building from rent increases upon prepayment. The owner did not pursue any further appeals. This case was featured in a radio show aired by National Public Radio entitled, “Housing for the Rural Poor Threatened." HPP has also used this case to successfully advocate with RHS for a change in its national guidelines on how to determine when restrictions should attach

Prince Hall Chambre - Prince Hall Tenants Association v. HUD ( N. District Texas 2004) The Texas Tenants Union contacted HPP for help when this HUD-insured low income project was in the final stages of a mortgage prepayment and an opt-out of the project-based section 8 contract. Although there were legal grounds to challenge the mortgage prepayment, HPP discovered that the more fundamental problem was that the owner had been failing to even use the Section 8 contract authority still allocated to the building, and was doing so with HUD’s blessing. As a result, HPP filed suit in Dallas federal court on behalf of the residents’ association, and negotiated an interim settlement on the courthouse steps, resulting in 78 low income families getting section 8 assistance that had been illegally denied to them. The case has now been settled, with section 8 benefits fully provided, and the tenants having been reimbursed for their out-of-pocket costs.

Taylor v. Jackson ( D. Oregon, filed 2002) Together with other public interest lawyers, HPP represents thousands of tenants in this nationwide class action challenging HUD’s improper instructions to housing authorities regarding the enhanced voucher program. Federal law requires that enhanced vouchers are supposed to protect tenants from all rent increases that follow an owner conversion of his building. However, between 1997 and 1999 HUD instructed section 8 programs that enhanced vouchers should cover only the first rent increase following a conversion. As a result, many tenants had to cover subsequent rent increases on their own, causing hardship and a direct conflict with what Congress intended. After HUD failed in its attempt to have the lawsuit dismissed, the parties have been negotiating a settlement under which HUD would instruct housing authorities to reimburse tenants.

Kenneth Arms - Kenneth Arms Tenant Association v. Martinez (D. California 2001) Court preliminarily enjoined a proposed prepayment of Section 236 BMIR (Below Market Interest Rate) mortgages and termination of a Section 8 project-based contract. The decision was based primarily on violation of state law, Govt Code Secs. 65863.10 and 65863.11. The court found no federal preemption of state statute, determined HUD has no duty to enforce state law, and dismissed HUD. Read the opinion here.

National Policy Advocacy

Rural Housing Service Mortgage Prepayment Rules - HPP has led a national coalition of groups interested in keeping rural apartments in the Section 515 program to advocate for federal rule changes strengthening preservation efforts. As a result, RHS has accepted a number of the group's recommendations in re-writing its rules. In addition, HPP has consulted repeatedly with top agency officials about potential future federal legislation, and it appears that HPP advocacy will likely lead to the strengthening of the preservation aspects of such legislation.