Katherine Banbury’s rent had increased by $90 a month even before she signed her first lease. In 2018, Banbury was living in Wisconsin and hoping to move into Dominium’s new Cambrick Apartments, marketed as attractive, HUD-supported affordable housing on St. Paul’s East Seventh Street. Based on the income threshold, Dominium would take approximately three weeks to complete the means-tests to determine if she was eligible.
When she came to sign her lease, she found that the price had gone up. But Banbury, a yoga instructor and healthy food chef, had already made plans to move to St. Paul. She felt locked inside.
“I’ve lived here for over four years, and it’s a revolving door,” said Banbury, who has seen a lot of fed-up neighbors in “Section 42″—federally regulated rentals go away. Huh. “It’s like taking candy from a kid. You have to be resource-tested to get here, and they’ve raised the fare by about 30 percent since I’ve been here. They say it’s cheap.”
Some of those rent increases occurred at the start of the pandemic or within its two-year lease, drawing the ire of St. Paul-based legal advocates. Lawyers for the Housing Justice Center successfully contested the increase within the term of its lease, but there is yet another rent increase.
It would increase his rent by 8 percent, which is more than double what is allowed under St. Paul’s new rent control ordinance, unless a property owner can prove the exception is required. Banbury, Cambrick and Union Flats, represented by the Housing Justice Center, is set to make their case on behalf of all tenants of a Dominium apartment building in a public appeals hearing Tuesday, July 19 at St. On Hampden Avenue in St. Paul.
Under the city’s new voter-approved ordinance, rent increases must be limited to 3 percent, unless a property owner can justify a large increase through documentation, such as rising operating costs or a recent redeploy. to prepare. And there is no evidence that the cambric has been redone. “In all eight Dominium buildings in St. Paul, they’re demanding an 8 percent increase, and that’s insane,” Banbury said. “They didn’t do anything in this building, nothing. We’ve messed up our workout machines since December.”
Ownership blames inflation
Dominium spokesman Khary Duckett confirmed that the company is seeking an 8 percent increase across the board in St. Paul and 12.5 percent in other parts of both the East and West Metro, but added that the company is working within the maximum increase. . Allowed by HUD and the city itself. St. Paul allows landlords to “self-certify” the required increase of between 3 and 8 percent without a formal review hearing.
Dominium’s biggest expenses, metro-wide, have been property taxes, insurance, utilities and “bad debt,” or unpaid rent, he said.
“The city provided the process to calculate the allowable fare increase,” Duckett said. “Our calculations show that we are entitled to an over 8 percent rent increase, but for the best business sense, for the city employees and the time of our employees, we believe that at that time we have Submission of 8 per cent meant the most for the submission of applications.”
Dominium, a for-profit Plymouth-based housing provider, describes itself as the fourth largest provider of affordable housing in the country, and is widely used by elected officials to combine attractive low-income senior housing, artist housing and mixed-income apartments. is celebrated. Buildings in cities across the country. It is also known for its historic restorations of properties such as the A-Mill Artist Lofts in Minneapolis and the former Schmidt Brewery in St.
At Fort Snelling’s Upper Post, the company has received support from Hennepin County to renovate more than 20 historic buildings into affordable housing for veterans. It operates eight sites and 1,400 units of accommodation in St. Paul alone.
In recent months, enthusiasm has waned, and some state lawmakers have openly described Dominium’s practices as unforgivable for vulnerable populations.
Saint Paul City Council member Jane Prince said she once raised the question of raising mid-lease rents for the city’s Housing and Redevelopment Authority and encouraged the city not to support Dominium on future projects if the practice continues . “It’s really hard to work with him,” Prince said. “They push the rent up to the max.”
Banbury said her rent had risen to $117 monthly in the early days of the pandemic, when she and several other tenants around her were newly unemployed. A property manager at the time, she said, told her they had to increase the rent in accordance with federal HUD requirements. “It’s up to them,” Banbury said. “It doesn’t even extend to HUD. They don’t need to hike fares that much. They don’t need to hike rents at all.”
Beyond the documented costs, Dominium officials have said there is another reason for St Paul’s not bound by the new rent control limits: they have an encroachment agreement with the city, known as a “Land Use Restrictive Agreement”. which is related to their federal low-income housing tax credit. Under that arrangement, they say they can increase the rent as permitted by HUD.
‘It literally demands an audit’
In general, company executives also note that Dominium is intended to serve residents earning between 50 and 60 percent of the area’s average income, an amount that tends to increase over time. Some renters who haven’t seen an increase in their income, or a uniform cost of living adjustment to their Social Security benefits, end up falling below the threshold over time, although most tenants still fit within that income band. There are.
“Rent increases in each of our communities, due to operating costs that are affected by inflation,” Duckett said. “Insurance costs are rising rapidly, property taxes, building maintenance, the cost of construction – all are rising.”
Jack Cain, an attorney at the Housing Justice Center, recently shared a general response with City Council member Prince in writing.
“Cambrick’s proposed new fare represents an increase of 23.5 percent compared to 2019 fares,” Cain wrote. “Operating expenses would have to grow at a rate faster than rents – perhaps at least double the (consumer price index) growth. It is so unlikely that it calls for an audit virtually.”
William Cray, four years the senior occupant of The Legends of Cottage Grove, is similarly unconvinced. Loan payments for some refinanced properties have also come down, given the low interest rates during the pandemic. Duckett confirmed that at least one St. Paul property – 808 Berry – was refinanced in 2021 prior to the property reform.
“A big expense for Dominium is debt repayment, and on properties built in previous years, that cost shouldn’t go up,” said Cray, which is facing a 12.5 percent rent increase this year. “The Dominium representative came to Cottage Grove a few weeks ago and basically said that an increase in the HUD count is allowed and even though they didn’t have to, they took the max.”
In other parts of the East and West Metro, Dominium is increasing rents in its senior housing buildings by 12.5 percent this year, prompting an open push from tenants. Banbury joined several residents of Cambrick Apartments on July 6, who went on strike outside River North Senior Apartments in Coon Rapids before a three-hour meeting with West Metro lawmakers, a city council member and Housing Justice Center lawyers. Were.
Many tenants of both senior housing and section 42 apartments have said that in a tight housing market, there are few places where they can relocate. Simply packing and moving is not an option. “Some of these people are in their 90s,” Banbury said.
Like Banbury, Barbara Marine had already faced rent escalation even before signing its lease with Dominium a few years ago. “The day I came to sign my lease, my rent went up,” said Marine, a resident of 808 Berry Place in St. Paul. “What are you going to do? I mean, you’ve vacated your last house.”
