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Council approves substitute to expand mixed‑income pilot, raises AMI and extends abatement term
Summary
The Metropolitan Council committee approved a substitute to the mixed‑income pilot program that extends tax abatement to the full 15‑year affordability period, makes the abatement renewable for a second 15 years, raises the income limit to 80% of AMI, and switches to a dynamic calculation intended to improve developer financing.
The Metropolitan Council committee approved a substitute to the mixed‑income pilot program designed to encourage for‑profit builders to include affordable units in new developments.
Councilmember Allen moved the substitute and said the changes respond to market conditions that have made financing projects harder to secure. “We are always working to try to make these programs work better,” Allen said, noting the substitute updates the program’s abatement term, calculator, and income target.
The substitute makes three substantive changes described during the meeting: it extends the tax abatement to cover the full 15‑year affordability period (and the program is renewable for a second 15 years, creating a potential 30‑year term), replaces the prior tiered calculation with a dynamic calculator used in other cities, and raises the income limit from 75% of area median income (AMI) to 80% AMI.
Public commenter Steve Ryder urged longer abatement terms and warned of overlap with existing programs administered by the Metropolitan Development and Housing Agency (MDHA) and the Health Educational Facilities Board. “15, like I say, is just the bare minimum. We can do better than that,” Ryder said, urging 20 to 30 years. Ryder also noted that caps for the City’s program and MDHA’s program are each $3,000,000 and cautioned that, taken together, the two programs could represent up to $6,000,000 in tax abatement.
Councilmember Benedict expressed support for the substitute, saying the committee’s changes could increase participation by developers. Allen said she expects to continue refining the measure and may defer it again on the full council floor to allow more work with staff and the director referenced in the discussion.
Committee members approved the substitute and then approved the bill as substituted by voice vote; the meeting record shows the motion carried but does not contain a roll‑call tally.
What this means: The substitute aims to make the mixed‑income pilot more attractive to developers by lengthening the effective abatement term, aligning the income target with common financing tiers, and adopting a dynamic calculation. Committee members said further refinements and additional conversations with staff and lenders will continue before final consideration on the council floor.
No formal amendments to the substitute were recorded during this committee meeting. The councilmember who moved the substitute was Allen; the record shows the motion was “moved and properly seconded” but does not identify the seconder by name.
