1.A Housing Improvement Areas Concept Discussion

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HR OUSEESEARCH Short Subjects Karen Baker and Deborah A. DysonRevised: August 2005 Housing Improvement Areas What are housing A housing improvement area (HIA) is a defined area in a city in which housing improvement areas? improvements in condominium or townhome complexes may be financed with the assistance of the city, or the city’seconomic development authority (EDA) or housing and redevelopment authority (HRA). Prior to 1996, cities needed special legislation to establish an HIA. In 1996, cities were granted the authority under general law. The general law, codified in Minnesota Statutes, sections 428A.11 to 428A.21, sunsets June 30, 2009. What kind of The improvements that may be made under this law include improvements to the improvements can common elements in a condominium complex or townhome development. be made in an HIA? Examples include roofing, siding, landscaping, roadways, and walkways. How is an HIA At property owner’s request. An HIA can only be established at the request established?(petition) of at least 25 percent of the owners of the housing units in the proposed area. If the petition is filed, then the city prepares an ordinance that: describes the area specifically, states the basis for imposing fees and the number of years the fees will be imposed, and makes a finding that without the HIA, the proposed improvements could not be made. The ordinance must also specify if the city, the EDA, or HRA will implement the ordinance. Notice, public hearing, ordinance. Before adopting the ordinance, the city must hold a public hearing at which the proposed improvements, affected housing units, and the exempt units are listed. Fees can be imposed on the basis of the tax capacity (value) of the housing unit, total square footage of the housing unit, or a method determined by the city and specified in the resolution.Potentially affected property owners may testify at the hearing. Those property owners may object in writing, and if the city agrees, may be excluded from the area or fee imposed. The ordinance may be adopted within six months after the conclusion of the public hearing. How are theThe city may finance the housing improvements by: improvements (1) advancing funds available to the city to pay up front and then recover the financed? costs by charging fees; or (2) issuing bonds to pay the costs and then imposing fees or assessments to repay the bonds. Obligations are not included in the city’s net debt and no election is required for their issuance.