Minneapolis seeks $35 million to clear MPHA backlog for 800 family homes; bill laid over

Minneapolis Public Housing Authority officials told the Minnesota Senate Committee on Housing and Homelessness Prevention that a one-time cash infusion is needed to eliminate a roughly $37 million capital backlog affecting 800 scattered-site family homes.

Senator Omar Fatae (bill sponsor) introduced the measure — identified in committee as Senate File 546 (sponsor’s amendment A1 was adopted) — and described it as targeted cash to preserve 800 deeply affordable family units that now require exterior and interior repairs. "We are asking for a cash infusion because MMB has interpreted that these [units] are no longer public and therefore we cannot get GO bonds," MPHA Executive Director Abdi Warsami told the committee, explaining why the authority seeks direct appropriations rather than bonding.

Why it matters: MPHA said the 800 scattered-site family homes serve about 3,003 residents and have a capital backlog of approximately $37 million. Warsami said MPHA converted the portfolio from HUD section 9 public housing to section 8 in 2020, a move that increased subsidy roughly 2.5 times and helped MPHA rebuild reserves, but the conversion also, according to agency counsel and state budget staff, affects eligibility for state GO bonding. MPHA told the committee that occupancy across its portfolio was about 99 percent in December and that it received roughly 3,300 applicants during a five-day opening of the waiting list.

MPHA described how it has used prior state and local grants to rehabilitate and turn units: a recent $5 million grant and other local support permitted exterior work on 50–60 homes, and a short-term program turned 41 homes with deeper interior work (kitchens, bathrooms, electrical and mechanical repairs). Agency leaders also highlighted a larger redevelopment project — a $65 million Springs Manor effort to rehabilitate 221 units and add 15 new deeply affordable, accessible units — as an example of mixed-tool financing (tax credits, local and state dollars).

Committee discussion focused on scale, equity and fiscal controls. Senators questioned whether the portfolio could be sustained after a one-time infusion, how many people are on waiting lists (MPHA reported roughly 4,300 people across relevant waiting lists), and how federal funding instability might affect operations. Warsami said that, with the conversion to section 8 and the additional subsidy, MPHA expects to build reserves going forward and described the requested cash as a one-time fix that would put the 800-unit portfolio on a sustainable footing.

Action and outcome: Senator Abler moved and the committee adopted the A1 amendment by voice vote. Senator Fatae’s original bill was then laid over for possible inclusion in an omnibus bill; the transcript records committee agreement to lay the bill over rather than an immediate committee vote to refer it. The committee record shows adoption of the A1 amendment by voice vote and the subsequent layover for omnibus consideration.

The MPHA presentation emphasized program outcomes: agency data cited an average family stay of about six years and said 14 percent of families who left the program since 2020 had become homeowners. MPHA officials emphasized that preserving the scattered-site family homes prevents displacement and supports children and young families in Minneapolis.

The committee did not take a final passage vote on the MPHA cash proposal; the bill was laid over for inclusion consideration in an omnibus capital package.