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Friday, December 02, 2022

Despite St. Paul Rent Control, Affordable Housing Provider Dominium Raises Rents Nearly 8%

For Jeffrey Swanson, the long snake-like grease stain that runs half the length of the exterior hallway carpet across his floor is more symbolic than inconvenient. A bad paint job on the exterior door of a neighbor’s apartment is equally revealing, as are the two community rooms on the ground floor of the building, both of which have been closed and off limits to residents for most of the year. during the construction of Dominium. -extensive remodeling of 808 Berry Place in St. Paul.

Then there is the new wheelchair access sign pointing up a flight of exterior granite steps to the courtyard. And the requirement, implemented in early June, that all renters have rental insurance within two weeks or face daily fines. And the parking space is no longer covered by the rent payments.

A 7.97 percent rent increase notice just arrived in the mail, more than double the 3 percent limit imposed by St. Paul’s new rent control ordinance.

The Plymouth Dominium-based housing provider’s rental letter to Swanson and other tenants at 808 Berry Place indicates that their rent is governed by federal regulations, as the building was built with low-income housing tax credits through the US Housing and Urban Development Section 42 program. The implication appears to be that Dominium is exempt from the city’s new 3 percent annual rent cap.

Swanson said he doesn’t live in a subsidized unit. He lives in one of 808 Berry’s market-rate lofts, where he and his wife pay more than $2,200 a month.

Swanson, an information technology professional, has his share of complaints about this or that glitch inside his apartment building, which bills itself as luxury living just off the Green Line. He said that most of the patio furniture in his building has gone without replacement.

“They said, ‘supply chain issues.’ I said, ‘Well, how about you put off the old stuff until the new stuff is ready?’ And they wouldn’t do that,” Swanson recalled.

When Dominium made renovations to the building and then informed tenants that their rent would increase by just under 8 percent, Swanson said he was surprised. The City of St. Paul allows landlords to exceed the 3 percent rent cap imposed by the city’s voter-backed new rent control ordinance, as long as they self-certify the increases with documentation of remodeling efforts or other reasons for granting a hardship waiver.

Furthermore, any increase above 8 percent would trigger a review hearing, and Dominium’s proposed rent increase is just below that threshold.

DOMINIUM: IMPROVEMENTS PLANNED FOR YEARS

Khayree Duckett, a Dominium spokeswoman, said the improvements at 808 Berry had been planned for years and were unrelated to the city’s rent control ordinance, which went into effect May 1.

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Dominium closed financing for the improvements in the spring of 2021. Duckett confirmed that Dominium would seek exemptions from the city’s rent cap on all eight St. Paul properties, and even larger increases on its West Metro properties in reaction to the rising inflation. construction costs, property taxes and other factors.

“Each of our communities in St. Paul has some element of financing through the Low Income Housing Tax Credit (LIHTC) financing program and those rental restrictions were implemented through an agreement with the City of St. Paul,” Duckett said. “They were parties to that agreement when we developed those communities. We think they already have rent control.”

He added: “You’re building quality, market-rate housing, but you’re only getting affordable rents for lower-income residents. If these properties were created outside of the low-income housing tax credit program, some of them would be paying hundreds of dollars more per month.”

Swanson and other tenants have said the renovations seemed to focus on market-rate units like hers, rather than the federally subsidized Section 42 units in her building. Those units were installed with housing tax credits for low-income residents, and federal regulations require maintenance parity between affordable and market-rate housing.

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