Metropolitan Council staff outline 2026 community development, HRA budget; says state rent-assistance vouchers expected in 2026

Metropolitan Council staff presented the 2026 operating budget for Community Development (CD) and the Housing and Redevelopment Authority (HRA) on Aug. 20, outlining a mix of property tax, federal grants and reserves to support core programs and new initiatives.

At the meeting, a staff member identified only as Lisa said the HRA will deliver a new state rent-assistance program called Bring It Home and that "we expect those vouchers to be available in 2026." Lisa also said staff are incorporating more qualitative, people-centered data into program and policy work.

Council staff flagged two implementation pressures. First, they said HUD-directed regulations for home inspections under the INSPIRE guidance are expected soon; staff said the changes "will be a big undertaking" and that teams have been preparing for the compliance work. Second, staff said they are monitoring possible federal budget changes and a projected shortfall and expect to return later this year for Council direction on remedies.

Heather Beisel, director of finance and administration for Metropolitan Transportation Services, provided the numerical breakdown for CD and HRA. She said uses by department are split about 40% HRA and 60% CD and highlighted that salary and benefits make up the largest share of costs. Beisel said contracted services include projects and a new grants-management system scheduled to go live this year.

Beisel and other staff listed key sources and amounts presented at the meeting: rental income from the family affordable housing program of about $3,150,000; HUD administrative fees of $9,300,000; a $3,000,000 HUD Pro Housing grant; and property tax revenue of $19,800,000 allocated to CD and HRA (not including parks or other pass-through amounts). Staff said $1,800,000 in transfers would go to LHIA and that pass-throughs include livable communities, parks, and planning assistance grants being built ahead of a 2026 funding round.

A council member, identified as Council member Wolf, asked about why the development budget exceeded the general fund limit and whether positions funded with grants (notably five FTEs supported by EPA and HUD Pro Housing grants) are sustainable after grant performance periods end. In response, staff said the EPA grant performance period extends roughly two more years and the HUD Pro Housing grant covers a five-year performance period; they noted the Council will need to plan how to fund those positions if retained after grants expire.

The presentation did not include any formal Council votes related to CD or HRA budget adoption at this meeting. Staff said they will return later in the year to present options to address the projected federal shortfall and to request direction if needed.

Less-critical details: staff noted planning assistance grants are being seeded with general fund transfers and described RA finance, IS and general counsel allocations as part of RA support costs.

Looking ahead, the HRA's Bring It Home program and the timing of HUD inspection regulations were flagged as items that will shape 2026 operations and potential future budget requests.