A local state representative is leading a select Senate committee tasked with addressing a local need: home ownership.
State Sen. Rich Draheim, R-Madison Lake, who represents Lonsdale, Dundas and Northfield in Rice County as well as portions of Le Sueur and Scott counties, is chairing the Senate Select Committee on Home Ownership.
The issue is top of mind in Rice County where vacancy rates are below 1 percent, and homes for sale are often snatched up quickly and go for above asking price. Local leaders met earlier this week with members of U.S. Sen. Tina Smith’s staff to discuss issues surrounding housing in the region.
The State Senate’s committee is tasked with making findings and recommendations to the Minnesota Senate regarding issues affecting the availability of affordable, owner-occupied housing. The committee cannot consider bills, and bills cannot be referred to the select committee.
The Senate adopted a resolution establishing the select committee in May. The group’s research will include presentations from stakeholders, including builders and developers. Barriers to affordable housing will be discussed, possibly including federal, state or local regulations, zoning requirements or land use codes.
The select committee is expected to dissolve when the Legislature adjourns in 2020.
Other committee members are Sen. Kari Dziedzic, DFL-Minneapolis; Sen. Mark Koran, R-North Branch; Sen. Dan Sparks, DFL-Austin and Sen. Karin Housley, R-St. Mary’s Point.
To Draheim, society is better off when more people achieve home ownership, something he said reduces the crime rate and increases individual wealth. He noted the average wealth of a renter is under $6,000, while the average homeowner has $230,000 in average equity in assets.
Draheim views homeownership as a path out of poverty. He noted a significant focus has been given to multi-family housing, meaning the majority of government funds have been spent on helping build apartment buildings and Section 8 housing. Part of the subcommittee’s work will focus on identifying population segments that are being missed in housing.
The senator also noted the intent is to keep the committee small with members representing regions with differing needs. For instance, Sparks represents Austin and Albert Lea, towns with older populations and a large influx of workers from other countries, while a couple members represent much larger population areas.
Draheim said in door-knocking and conversations with employers, he has learned construction costs have become too high and that that presents a challenge for communities in trying to draw in residents.
This year’s legislative session also included the establishment of a Housing Affordability Legislative Commission, which is different from the Senate’s select committee. The legislative commission consists of eight members of the Legislature, two members appointed by party leadership in each legislative body.
No official appointments have been made to the legislative commission.
Draheim, a real estate development company owner, serves on a 10-county board of Realtors and on the governor’s task force for housing. He said good work has been done to address the need for housing, but pathways to ownership have not been sufficiently paved.
The first select committee meeting is scheduled for Tuesday.
Northfield City Administrator Ben Martig said housing is an issue that spans the state, adding employers have told him they need a strong workforce, which requires a sufficient supply of affordable housing. Martig said the city wants a spectrum of housing options to meet worker demand. The city’s housing priorities are expanded to include emergency housing and senior housing, two areas of local need. He noted the city’s work in expanding the Southbridge Townhomes complex and assisting in the development of income-restricted rental units at Koester Court.
On a large scale, Martig also views home ownership as a chance for owners to accumulate wealth.