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What is the housing need? <br />� <br />�� . <br />Qepartment of Emplapment and Ecanomic �evelapment <br />10d. <br />.. .. <br />.. .. <br />Mi n nesota <br />Housing <br />���,���� ������ <br />Meeting Minnesota's <br />Workforce Housing Needs <br />The Economic Development and Housing Challenge Fund (Challenge <br />Fund) is designed to meet the housing needs of workforce communities <br />across the state. Nearly all working households in these communities fit <br />income guidelines for this flexible, proven and feasible affordable housing <br />program. <br />The Challenge Fund can meet this need through loans for the <br />construction, acquisition, rehabilitation or permanent financing; <br />interest rate reduction; refinancing and gap financing. It provides the <br />infrastructure to serve the vast majority of these working households <br />through both affordable rental and homeownership options. <br />In our recovering Minnesota economy, we have shortages of all types of housing and households are paying too <br />much. In 2014, nearly 575,000 Minnesotans were cost burdened, paying more than 30% of their income for housing. <br />In many Greater Minnesota communities jobs are plentiful but employers are having a difiFicult time recruiting and <br />retaining employees because of this housing shortage. Minnesota Housing and the Department of Employment <br />and Economic Development are working together to identify these workforce hotspots across the state and deploy <br />resources. Historically lower rents in Greater Minnesota can't support construction and operating costs, leaving a gap <br />that makes traditional financing difficult. <br />What is Workforce Housing? <br />• Affordable to the local workforce <br />• Within 10 miles of a city with job growth <br />• Within 10 miles of a long commute community <br />• Includes both rental and homeownership <br />How many new rental units are needed? <br />Governor's Challenge Fund <br />Budget Recommendations <br />Base: $25.8 million <br />Supplemental Budget: $10 million <br />Total: $35.8 million <br />4,500-7,500 additional rental units are needed to bring the vacancy rate from 2.5% to 4.0-5.0% in the 77 communities <br />with workforce housing needs (see map on back). <br />What are the characteristics of our workforce communities? <br />$27,��� Typical renter household income <br />,�6g,�00 Typical homeowner household income <br />$62,��0 Challenge Fund renter household income limits <br />$$9���� Challenge Fund homeownerhousehold income limits <br />95 % Typical new hires in workforce communities with wages below $58,000 <br />