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Homeless advocates say apartment complex in Moorhead will improve neighborhood

MOORHEAD – Proponents of a controversial proposed apartment complex for the homeless here say the building would improve the area, despite concerns from neighbors who fear the opposite.

This is largely because Churches United for the Homeless, which is proposing the $6.5 million, 41-unit complex at 315 34th St. N., is applying for a $6 million deferred loan from the Minnesota Housing Finance Agency.

As a condition of the deferred 20-year loan, state inspectors would regularly check the building to ensure it’s being properly maintained, and to ensure any problematic tenants are being dealt with accordingly.

“They make sure that we’re not putting up slummy apartment buildings,” said Liz Kuoppala, executive director of the Minnesota Coalition for the Homeless. “This is public funding to meet a public purpose in every sense of the word. So we want it to fit the neighborhood.”

If the building stays compliant over that 20-year period, the loan would be forgiven, said Dara Lee, director of the Clay County Housing and Redevelopment Authority.

Neighbors in Arbor Park and Pine View have argued the building would tank home values. Some residents told the Moorhead City Council this week that real estate agents have been advising potential buyers to avoid the area.

The council voted unanimously Monday to oppose the apartment complex, a purely political move. City officials say they have no jurisdiction to halt the project because it meets zoning requirements. On Tuesday, Clay County Commissioners Grant Weyland and Kevin Campbell said they hope to stop the project until a new site can be found.

A Minnesota Housing Finance Agency official said public opinion about a project doesn’t affect its chances of getting money.

“We have written criteria in place that are uniformly applied to all applications when making funding decisions,” Tonja Orr, assistant commissioner for housing policy, said in a statement.

Orr said the agency does require applicants to work with local units of government to ensure proper zoning.

Dispelling myths

The notion that low-income housing negatively affects neighboring property values is a myth, said Kuoppala, who lives in Moorhead. She pointed to a study that Churches United had done as part of its application.

The proposed apartment complex “will have a positive impact on the surrounding neighborhood,” according to the 182-page study from Novogradac & Company LLP, an accounting firm from Kansas.

The study looked at, in part, the project’s proximity to schools, commercial and recreational areas, and health care services. It refers to the apartment complex as the “Subject” of the study.

“The construction of the Subject will improve the neighborhood,” the study notes. “There are no negative attributes of the Subject site. Overall, the location of the Subject within the community presents a good location for the development.”

The Family Housing Fund, a Minneapolis nonprofit, has also said there is “little to no evidence” that affordable housing lowers neighboring property values.

“In fact, each of the areas analyzed displayed stronger market performance after affordable housing was built,” the group said in a May release, pointing to studies in the Twin Cities.

The same seems true in Moorhead, said Peter Doll, who handles real estate development issues for the city of Moorhead.

“You hear in a lot of public meetings that if you allow this use or that use, you’re going to wreck my value,” Doll said. “I’ve never been able to quantify that. (The complaint is) just overused.”

Kuoppala thinks the myth comes from a fear of the unknown.

“It’s hard when you don’t know what you’re getting,” she said. “It’s easy to imagine the worst.”

She said once these projects are completed, neighbors often embrace them.

“I’m very confident that whole process will move forward in Moorhead just like it has in every other community,” Kuoppala said, “and what it’ll end up doing is housing people who currently don’t have housing.”  

A ‘very clear’ need

The Legislature last session set aside $100 million in bonding, $80 million of which was for housing infrastructure.

The Minnesota Housing Finance Agency received more than 80 requests totaling over $233 million in deferred financing, a spokeswoman said.

Because the state is lending money, it wants the project to be successful, said Lee, who is also vice president of the Churches United board of directors.

The state will inspect the property annually for at least 20 years and will find out how many police calls were made to the building and will ask how those calls were handled, Lee said. There are also monthly check-ins, where Churches United would report expenses, move-ins and move-outs.

If the project ever falls out of compliance, the state could find a new building manager, Lee said.

“This is not a property that once built is just ignored,” she said. “It’s monitored on an ongoing basis.”

There was a tight turnaround from when the money became available in mid-May to the application deadline of June 10, which is largely why Churches United didn’t schedule public meetings before applying, Lee said.

“We know we should’ve talked to the community ahead of time. We wanted to,” she said. “But literally the application got driven to Minneapolis on the day it was due.”

City Councilman Jim Haney, who made the original motion for the council to oppose the project, questioned on Monday “whether there’s a need for (the apartment) anyplace,” but Kuoppala and Lee said the need is evident.

In Moorhead, the number of homeless children has quadrupled, from 13 in 2000 to 53 in 2012, Lee said. In 2012, 30 homeless parents in Moorhead had children, and 22 had school-aged children. That number has increased, she said.

Across the state, the number of homeless children has doubled over the past decade, Kuoppala said.

“I think it’s very clear there’s a significant need for it,” she said.