Why Minnesota Needs to Protect the 2040 Plan

Minneapolis was leading the nation in zoning reform and increasing its housing supply faster than any city in the Midwest, but recent litigation put that progress on hold.

The city launched its 20-year comprehensive plan — Minneapolis 2040 — in 2020, the nation's first major municipal-led zoning reform to re-legalize housing options in previously single-family-only zones. The Plan legalized triplexes and duplexes, allowed for more housing near transit and job centers, and made it easier to build larger apartments by eliminating parking requirements to increase housing equity and affordability across the city. It also made Minneapolis the first city in the country to see inflation drop below 2 percent.

2040 Plan Challenged by Environmental Opposition

The 2040 Plan addresses the worsening housing attainability crisis in Minnesota. The state's housing shortage grew to 105,524 homes in 2021, more than double the amount in 2012, according to Up for Growth's housing underproduction report. This underscores a larger, national housing supply shortage — underproduction of housing in the U.S. increased by nearly 3% to 3.9 million missing homes last year. This is not just happening in big cities — housing underproduction increased by nearly 50% in small towns between 2019 and 2021.

And yet, the impact of the 2040 Plan was threatened when opponents — "Not in My Back Yard" (NIMBY) defenders fronting as environmentalists — twisted a Minnesota law called the Minnesota Environmental Rights Act (MERA), claiming the Plan harms the environment. Their opposition is based on a logistically impossible and hypothetical scenario wherein every single-family home in Minneapolis is immediately replaced with a triplex, causing irreparable environmental harm. Not only is the opposition based on a theoretical, but it also fails to acknowledge that the Minneapolis 2040 is an environmental review in itself.

As a result of the misleading opposition, the city has frozen the implementation of its 2040 Plan amid ongoing litigation, denying community members access to housing options that meet their needs. However, a State bill was introduced this year in the House and Senate, with support from the City of Minneapolis and the American Planning Association (APA) Minnesota chapter, that would reform Minnesota law to exempt increases to residential density advanced through comprehensive plans from MERA. While MERA is well-intentioned, this litigation shows how it's vulnerable to abuse. The passage of the bill is critical for the city's defense of the 2040 Plan against the lawsuit. Further, it's essential for breaking free from longstanding policies that increase costs and limit housing choice in Minneapolis, and encouraging communities across the state and nation to pursue zoning reform through comprehensive planning.

Minneapolis' 2040 Plan: Housing Solution Threatened

The 2040 Plan is an example of how comprehensive plans are the vehicle for driving change at a local level — and how Minneapolis is leading the way. The land use reforms embraced in the Plan boosted the housing supply in the city and continued to keep rent low — Minneapolis increased its housing supply by 12 percent while rents grew by just 1 percent, according to The Pew Charitable Trust — helping meet Minneapolis's growing housing needs of about 4,000 new units per year. If the legislature does not pass the MERA reform bill, the city would lose around $9.7 million that it has already invested into affordable housing. It would also threaten Minnesota's status as a national leader in housing supply and zoning reform.

Aside from the projected — and proven — impact of the 2040 Plan on Minneapolis' housing supply, failing to pass a state fix would also affect Minnesota communities' ability to have a voice in the plans of their cities. The 2040 Plan was the result of collaboration between city planners and Minneapolis residents over hundreds of public engagements. The Plan connected data, research, and community input with a variety of housing, infrastructure, and transportation policies. The ongoing litigation would have a chilling effect on communities, resulting in fewer plans, less public engagement, and a decreased likelihood of cities willing to use comprehensive plans to make bold changes for the better of their constituents.

Communities should not have to worry about environmental lawsuits being taken out of context. Planning is the best way to address housing while balancing the interests of all residents. Communities and planners who support them need the flexibility to align pro-housing policies with the vision of plans. If the state legislature fails to protect the 2040 Plan, communities will avoid taking bold planning action to support the growth that's already happening in cities and towns across Minnesota, adding to the state's growing housing deficit. It could even disincentivize communities from using planning as a tool for growth — one that's been proven to improve housing opportunities in communities across the country.

The Minnesota Legislature must lead again by moving this session to protect the 2040 Plan and support planning-led efforts statewide to produce more housing — not add additional barriers.

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