Transforming zoning to add housing supply

Q&A with St. Paul Planning Commissioner Nate Hood

NH: St. Paul is undergoing the most transformative zoning changes since the 1970s. The update is broken into two phases: the first focuses on small housing, accessory dwelling units and small parcels, and the second focuses on adding flexibility to support greater housing density in lowdensity residential areas.

The driving force behind these changes is to empower more property owners to add new housing supply – the “missing middle.” Most residential lots in the city’s core are small and rebuilding on them often doesn’t meet the existing zoning code. “Non-conforming use” cases are common, especially with existing small multifamily buildings that pre-date the 1970s. Zoning updates will hopefully eliminate these issues.

With current market conditions, I don’t see these changes adding a significant amount of new supply to the marketplace. However, I think they are the right move. Giving homeowners and developers more zoning flexibility will help drive down costs over the long term. I’m optimistic that we’ll see these changes slowly start to happen over the next decade if passed.

Q. A handful of cities in Minnesota have or are looking to modernize their zoning practices. How do these efforts look to impact the state-level zoning modernization discussion?

NH: We don’t have any local case studies on ‘what is working’ just yet – but we know what isn’t working: the status quo.

I am typically a proponent of local control; however, I am very supportive of zoning modernization efforts at the state level. Local zoning and other locally imposed housingrelated regulatory frameworks have been excessive, hurt broader housing affordability and have resulted in less variety in housing types across the state of Minnesota. This needs to change.

We should always be learning from each other and continuously adapting. State-level regulations should look at what is working in cities and adapt accordingly.

Cities are often at the forefront of addressing housing challenges, as they are on the front lines of dealing with the effects of zoning regulations on the availability and affordability of housing. Cities have the advantage of being able to experiment with new zoning policies, such as mixed-use zoning, form-based codes and inclusionary zoning, which can help promote more diverse and affordable housing options.

Q. From your vantage point on a planning commission, what procedural changes can be made to improve the process for both project applicants and residents?

NH: The biggest procedural change is permitting more by-right development. This doesn’t mean eliminating zoning altogether, but it means creating a clear and consistent regulatory environment where people know what is – and what is not – permitted. Many cities currently operate in a complex grey area.

The biggest impact we’ve seen in the St. Paul Planning Commission’s workload is the removal of parking requirements. Prior to removing parking requirements, it was common to see a project that needed a few spaces variance each meeting. Those items are now removed from the political process and are being built by-right. That’s been a big win. It saves city staff and commissioners time, and it creates more certainty for people looking to improve land or existing structures.

Q. Planning commissions deal with a variety of topics, from large-scale developments to individual variance requests. What is your most memorable moment?

NH: What’s funny about being on a planning commission is that the size of a project doesn’t necessarily correspond to how much work it’ll be for the commission. You can have a large industrial project that gets approved within 15 minutes and then you’ll have an item that goes into three hours of debate over extending the hours of a pizza shop (true story).

My most memorable experience was a contentious issue with a 200-plus-unit, mixed-use apartment with 50% of the units being affordable. The item met all zoning and building codes, but activists were able to pull a discretionary site plan review and wanted to torpedo the project because it wasn’t affordable enough and didn’t fit the character of the neighborhood. I disagreed with those assertions, as did the city’s own attorney, but the commission as a whole ultimately ended up voting against the project. It was very heated.

I learned two lessons that I think apply broadly to zoning and regulatory frameworks.

First, allowing discretionary reviews of projects that meet codes creates uncertainty, increases the likelihood of projects becoming politicized and disincentivizes new construction projects.

Second, geography is very personal for most all people. Often people move to an area because they like it a certain way. New development changes that. I used to confront these people (NIMBYs) head-on. Now, I’ve learned that you need to approach these situations with empathy.

Housing First Minnesota is the leading trade group for builders, remodelers, and housing industry suppliers dedicated to creating homeownership opportunities for all Minnesotans.

Helping you succeed is our calling.

Whether that’s through direct money-saving benefits, powerful advocacy helping our industry thrive, nationleading marketing to help your business grow, or networking and building connections that create trust and facilitate business, we bring the industry together.

If you are not yet a member of Housing First Minnesota, we warmly invite you to consider membership.

According to the MN Department of Labor & Industry, of those who take the Minnesota Contractor License Exam, 40% fail. MINNESOTA CONTRACTOR Pre-License Exam Prep Online Course

If you know of someone wanting to become a licensed contractor in Minnesota, tell them about Contractor University’s online MN Contractor Pre-License Exam Prep course.

SPONSORED BY

“The value I received from the course and the examination was well worth my time, money and e ort.” - Peter Mille

“Detailed, practical and well presented.”

- Dan Ziegler, ZIG Builders, LLC

Let’s prepare for success. Details

LEARNING TOOLS PROVIDED:

• Video training taught by a former building o cial and Minnesota building codes expert

• 2020 Minnesota residential code book ($110 value)

• Course study guide

• Exam guidebook

• Minnesota statutes booklet

• Practice exam with more than 175 questions

COST: $249

“Simple and easy format to follow! Glad I took this course as it helps you figure out how to take the test for maximum success!”

- Drago Zgrabljic, Facility Maintenance, Inc.

CONTRACTORU.COM

Legislature takes a pass on zoning reform, focuses on state funding for housing

• $45 million for homelessness prevention in addition to the $50 million that Walz signed into law on March 31.

• Legislative leaders acknowledged the need for a broader discussion on housing supply, with both the House and Senate indicating that housing supply will be a major issue for discussion in 2024.

“I think is an important part of the discussion. I think this is part of a critical piece of the overall conversation about zoning, about regulations, about what cities can do and require, about what developers can do and require. It’s a conversation that we need to have in-depth in committee,” said Sen. Lindsey Port (DFL-Burnsville), chair of the Senate Housing Committee.

CONTINUED FROM PAGE 1

DFL passes wage liability law

Throughout the legislative discussion, the bill was controversial and drew significant legislative opposition.

“I find it concerning when we have repeated conversations about a lack of affordable housing, and we’re going to drive the cost of housing up,” said Rep. Shane Mekeland (R-Becker) during a house floor debate on the topic. “We have a lack of labor. We are going to make it more complicated. Nobody talked to me about impacting small general contractors. I wonder if any general contractors were brought into the conversations. This language is simply untenable.”

During the Senate floor discussion, Senator Rich Draheim (R-Madison Lake), a contractor and developer himself, listed off the variety of subcontractors that can be utilized during the construction of a home, totaling nearly 30 different companies that the general contractor would now be liable for their payroll.

“You need contractors, if we are going to impose a rule on contractors, to be part of the solution,” Draheim said. “It’s obvious to me in this portion of the bill that they were not consulted.”

Thousands of industry leaders from across the construction industry opposed the measure as written and contacted their legislators stating as much. On numerous occasions, legislators attempted to amend and improve the bill, but ultimately none of the industry amendments were accepted by the bill’s authors.

During the committee process, there were nearly a dozen testifiers that voiced concerns, including St. Paul attorney Stephen Yoch, counsel for dozens of both general contractors and subcontractors.

“Minnesota already has one of the most closely regulated home construction industries in the county, far more than any of our surrounding states,” stated Yoch in opposition to the bill. “This proposed bill will not only put small general contractors out of business but increase prices for consumers further undermining the availability of affordable housing in this state.”

Industry groups will now turn their focus to understanding the bill’s impacts. The lack of industry involvement in the crafting of the bill could make the implementation of the bill challenging.

“This legislation was written and passed without any meaningful input from general contractors and subcontractors, and it shows,” said Nick Erickson, senior director of housing policy for Housing First Minnesota. “The challenge now will be to attempt to educate an industry, all at a time when we are facing a historic housing and workforce crisis.”