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When HJC was formed in 1999, the affordable housing community, both in Minnesota and across the country, had become alarmed at the growing trend toward private owners of HUD assisted housing converting their properties to market rate rents. Owners were doing this either by prepaying their HUD insured mortgages, thus terminating low income use restrictions, or by choosing to not renew Section 8 contracts ("opting out"). HJC began by developing legal and other strategies to retain these properties in the HUD programs. Part of this involved extensive research into a patchwork of federal and state preservation laws, as well as scrutinizing loan documents and HUD contracts. It also required that HJC establish a system to monitor and take action on properties at risk for conversion. HJC began convening monthly meetings with tenant advocates and other community organizations in order to review each property and develop a case by case preservation strategy. These strategies included litigation against owners or government agencies, negotiations, tenant empowerment, political lobbying, community education, technical assistance, and sometimes even provision of assistance to project owners who weren't being treated properly by the government. Plans were also coordinated with the Minnesota Housing Finance Agency, the government entity charged with oversight of many of these properties, and with the discretion to provide financial incentives to owners threatening to convert. While projects have been lost in Minnesota, this system has also resulted in a remarkable rate of preservation.
HJC has had numerous successes in the preservation of
- Developed comprehensive preservation strategy adopted by Twin
Cities Metropolitan Mayors Affordable Housing Task Force.
- Developed preservation financing model using existing but
underutilized tools and funding. This
model is now the most commonly used preservation tool in HUD mortgage
- Convinced MN Housing Finance Agency to review and revise its
interpretation of Section 8 contract preventing owner termination. This created an important preservation
- Convinced HUD to revise a national policy which was improperly limiting needed rent increases for Section 8 owners.
- Convinced HUD to change another national policy which had imposed considerable hardship on "overhoused" enhanced voucher-holder tenants.
- Fostered an environment in Minnesota that discourages and
has prevented the loss of thousands of units.
Aggressive intervention and litigation strategies created public
attention for the issue, encouraged owners to pursue negotiated resolutions,
and led to creation of $10 million (annual) state preservation fund.
- Secured HUD agreement to revise federal policy on Section 8
notices benefiting tenants nationwide, through negotiations to resolve
litigation involving Oak Grove Towers/ Riverside Plaza cases in Minneapolis.
Provided technical and co-counseling assistance to attorneys and advocates
in California, Colorado, Florida, Hawaii, Illinois, Maryland, Massachusetts,
Missouri, New Jersey, New Mexico, New York, Oregon, Texas, Virginia,
Washington, and the District of Columbia for preservation.