Minnetonka City Council — Transcript

Wednesday, July 23, 2025

Story

Minnetonka tackles homelessness, affordable housing in ambitious policy push

Manufactured Housing for Affordable Ownership

Legacy Housing Initiative

Ownership Programs Update (Equity and Inclusion Plan - EIP)

Housing Improvement Areas (HIA)

Rental Registry and Short-Term Rentals (STRs)

Affordable Housing Trust Fund / Local Affordable Housing Aid (LAA)

Votes (7)

Encampment Policy Discussion

Staff directed to bring the policy back for formal adoption, incorporating discussion points.

Dissent: No formal dissent recorded on moving to the next step, but several council members voiced strong opinions on specific aspects of the policy (e.g., mental health, notice period, criminalization).

The council discussed the draft encampment policy, emphasizing a proactive, outreach-first approach. Key points of contention included the balance between compassion and enforcement, especially for individuals with mental health issues, the practicalities of property storage, and the appropriate timeline for notice to vacate. Comparisons were made to other cities' experiences, highlighting the need for a clear, yet humane, enforcement mechanism.

Manufactured Housing for Affordable Ownership

Council provided a 'nod' for staff to proceed with further research into the legal and financing aspects of manufactured housing.

Staff proposed exploring manufactured homes as an affordable ownership solution, citing their cost-effectiveness and customization potential. The city would consider placing these on city-owned land with affordability covenants. Council acknowledged the innovative approach but raised concerns about the lifespan of manufactured homes, financing challenges, and ensuring wealth building for homeowners.

Legacy Housing Initiative

Staff to create marketing materials and work with the legal team on necessary documents. Additional ideas for incentives (tax abatements, senior assistance) noted for future programming considerations.

The Legacy Housing Initiative was introduced as a way for current homeowners to voluntarily contribute to long-term housing affordability, offering various legal avenues like covenants or sales to non-profits. The Boulder program, where a council member donated her home, was highlighted. Discussion included potential benefits for homeowners (e.g., tax benefits, streamlined sales) and ideas for future incentives like tax abatements or senior assistance programs.

Ownership Programs Update (EIP Discussion)

Informational update; no formal action taken. Future discussion on fund utilization may occur.

This item served as a brief check-in on the city's homeownership programs previously discussed in the EIP. A primary concern reiterated was the effectiveness of funding when suitable homes are scarce for program implementation. A council member emphasized the importance of the city leveraging its financial contributions to influence the equitable design and implementation of programs, particularly those run by partner organizations.

Housing Improvement Areas (HIA) Update

Informational update; no formal action taken.

Staff provided an update on Housing Improvement Area (HIA) projects, noting recent major renovations like the $12 million project at Chasewood and ongoing payments from Cloud9. It was clarified that the city facilitates financing for HIAs but does not subsidize them, addressing common public misconceptions. The discussion also touched on the history of HOA laws and the impact of the condo warranty law on maintenance planning and development.

Rental Registry and Short-Term Rentals (STRs) Discussion

Staff directed to research options for a short-term rental ordinance and bring it back to the council for consideration in Q1 2026, aiming for an April 1st effective date, with public engagement.

An update on the city's rental registry showed high compliance for long-term rentals, with STRs being a small percentage. Council Member Romey expressed significant concerns about the negative impacts of STRs in lakeshore communities, citing examples of neighboring cities implementing bans or minimum stay requirements. She recommended considering a 30-day minimum or a primary residence requirement for STRs. Staff was directed to explore ordinance options for Q1 2026, including public engagement and understanding that new regulations could be applied without grandfathering.

Affordable Housing Trust Fund / Local Affordable Housing Aid (LAA) Update

Informational update; no formal action taken.

This was an informational update on two city funding sources. The Local Affordable Housing Aid (LAA), providing $800,000 annually from state sales tax, has restrictions against replacing existing program funding and is best suited for one or two new projects due to state reporting. The Affordable Housing Trust Fund, holding $4.1 million, was created through TIF pooling, enabled by special state legislation, and also includes repayments from a historic loan.

Notable Quotes (22)

Minnotonka hasn't experienced encampments like large encampments that we um hear about, but we want to be proactive. We don't want to be reactive.

Kendall Larson [0:12:05]
Encampment Policy Discussion

I just don't want us to be criminalizing people who have mental health who may not accept the um help because of their mental health.

Ky Kley [0:18:24]
Encampment Policy Discussion

We want to be fair and kind to people, but we also um want to um um we want to we want to have the opportunity to ensure that we can change a situation that is not the way it should be.

Brad Woram, Mayor [0:20:53]
Encampment Policy Discussion

if we're coming to an enforcement conclusion and there is literally not a bed for a person in the metro to go to, we're not taking that. We're not doing that. That's that's not the right thing to do if you don't provide a choice.

Jason Tate, Deputy Chief of Police [0:25:22]
Encampment Policy Discussion

I lean on giving everybody the most opportunity to get their situation um, improved slightly with our help and giving people time and opportunity. And even if it's on the front yard, I think we have to we have to have some grace for people.

Rebecca Shack, W two [0:30:19]
Encampment Policy Discussion

Portland has done a great job on compassion. They've done a horrible job on enforcement, and I think there's a difference.

Brad Woram, Mayor [0:32:06]
Encampment Policy Discussion

because we can't think of any other way to provide ownership, affordable ownership in the city without trying this.

Julia Wishan, Community Development Director [0:38:52]
Manufactured Housing for Affordable Ownership

I'm looking for wear. I'm looking for how's it holding up? It's actually holding up pretty well. It's very airtight. The windows are very nice. Her heating bills are low.

Julia Wishan, Community Development Director [0:40:20]
Manufactured Housing for Affordable Ownership

if we're going to, um, write down the land or, you know, give the land, however, you know, we do it. Um, and you said covenant. What does the covenant look like? And is it going to be another land trust type deal where you put the 99-year lease on the land? Is it or if someone purchas it, would it be a way that they can also make sure that they're getting some generational wealth in something like this?

Ky Kley, W four [0:44:31]
Manufactured Housing for Affordable Ownership

I mean, I I favor this because we have to try new stuff and we have to figure out how to how to do that.

Brad Woram, Mayor [0:47:33]
Manufactured Housing for Affordable Ownership

how can we encourage folks to preserve their existing housing as affordable moving forward for the next generation?

Alicia Gray, Economic Development and Housing Manager [0:52:16]
Legacy Housing Initiative

I believe that we all have a responsibility to each other. And as I've gotten older, maybe because I've had more time and more comfort, more ability, I've taken that sense of responsibility more seriously.

Council Member from Boulder (video) [0:54:39]
Legacy Housing Initiative

it is a legal document that a in this case a property owner could execute that would place some sort of restriction on their their bundle of sticks that's associated with real property ownership in some fashion. So restricting one of their uh real property rights in some fashion. It runs with the land u and so it applies u against subsequent purchasers of the land.

Eric Nelson, City Attorney [0:58:08]
Legacy Housing Initiative

the cheapest affordable housing we can come up with is naturally occurring affordable housing. So, anything we can do to create incentives to to preserve affordable housing makes sense.

Brad Woram, Mayor [1:02:44]
Legacy Housing Initiative

should we be advocating perhaps a change in state law for tax abatements. Could Could there be a way to look at tax abatement scenarios where homeowner you you know 10 years worth of tax abatements in exchange for you know your house being put into a program to some attractiveness...

Mike Bunk, City Manager [1:03:52]
Legacy Housing Initiative

my thought process is always going to be how can we influence programs? If we're funding the programs, then we should be able to influence them.

Ky Kley, W four [1:06:56]
Ownership Programs Update (EIP Discussion)

I said, well, we're not subsidizing the city's not in these HAS. There's no city money going into it. We're the conduit for financing.

Julia Wishan, Community Development Director [1:09:47]
Housing Improvement Areas (HIA) Update

we basically saved 188 units of housing that probably would have gone away in some way, shape, matter, form had we not done that. And, you know, this is a beautiful tool.

Brad Woram, Mayor [1:11:39]
Housing Improvement Areas (HIA) Update

I have a couple of residents um who live next to um the short-term rentals... the problem is is that, you know, it's kind of the small houses. kind of tied in are are being sold off and then being um purchased by investment groups or people and then being rebuilt as as this. And it's you know caused a lot of trouble and issues in in communities around the lake.

Paula Romey, W three [1:16:32]
Rental Registry and Short-Term Rentals (STRs) Discussion

I would like there personally to see some sort of policy... either a 30-day or the homestead, what Excelsier is doing.

Paula Romey, W three [1:18:22]
Rental Registry and Short-Term Rentals (STRs) Discussion

A registration or a license is is registration different so that they you're not under a legal obligation to grandfather and like you would with some sort of, you know, zoning entitlement, land use entitlement that runs with the land.

Eric Nelson, City Attorney [1:23:44]
Rental Registry and Short-Term Rentals (STRs) Discussion

I did put in there, we talked about when during the EIP the uses. So if you caught the little language in there that says you can't replace funding. So like pathways, we can't replace our funding for pathways with that money.

Julia Wishan, Community Development Director [1:24:49]
Affordable Housing Trust Fund / Local Affordable Housing Aid (LAA) Update

Ordinances & Resolutions (19)

Encampment PolicyPolicy

Draft policy to address homeless encampments on public property.

Encampment SurveyOther

Survey filled out by council members to guide policy drafting.

Homelessness Work Group Internal Response ModelPlan

Staff-developed procedures for assisting individuals experiencing homelessness.

Police Department Formal Policy for Homeless IndividualsPolicy

Guidelines for police interactions with homeless individuals.

Anti-camping ordinancesOrdinance

General term for ordinances in other cities prohibiting camping on public property.

Public use ordinanceOrdinance

City ordinance that could be applied for encampment enforcement.

Parks ordinanceOrdinance

City ordinance that could be applied for encampment enforcement.

Library ordinanceOrdinance

City ordinance that could be applied for encampment enforcement.

Zoning ordinanceOrdinance

Ordinance governing land use and development, relevant for manufactured homes.

CovenantOther

Legal document used to place restrictions on real property, especially for long-term affordability.

WillOther

Estate planning document, relevant for the Legacy Housing Program.

Equity and Inclusion Plan (EIP)Plan

City plan previously discussed, related to ownership programs and fund use.

HOA lawOther

Laws pertaining to Homeowners Associations, including planning for future maintenance.

Condominium Warranty LawLaw

State law impacting condominium construction and litigation, affecting housing production.

Rental Registry ProgramProgram

City program for registering rental properties.

Short-Term Rental OrdinanceOrdinance

Proposed ordinance to regulate short-term rentals.

International Property Maintenance CodeCode

City-adopted code used for inspecting residential properties for livability.

Fire CodeCode

Code used by the fire department for multifamily and commercial inspections.

Special Legislation (TIF pooling)Legislation

State legislation that allowed TIF pooling to fund the Affordable Housing Trust Fund.

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