4d Affordable Housing Incentive Program

The 4d Affordable Housing Incentive Program offers rental property owners a 40% tax rate reduction and limited grant assistance for units that remain affordable for a consecutive ten-year period.

Property owners can invest the savings into updating and maintaining their naturally occurring affordable housing units, and low-income families are provided additional safe and stable housing options at a time when rent continues to rise across the Twin Cities. Minnesota Housing Finance Agency will have final approval of 4d tax classification for property owners who meet Saint Paul's eligibility guidelines.

Program Guidelines

Application Materials

Helpful Links

Additional Information

Benefits

Qualified rental property owners that agree to keep a minimum percentage of their units affordable for a 10-year period will receive:

  • The “low-income rental” classification (“LIRC”) on qualifying units, and the reduced 4d class tax rate (approximately 40% less than the rate on typical rental units)
  • One-time grant assistance for each qualifying unit based on Area Median Income (AMI) (up to $1,200 per property or per owner of single-family properties)​
    • $75 per unit available at 60% AMI
    • $200 per unit available at 50% AMI
  • Payment of the application fee ($10/unit) for the first-year State of Minnesota Low Income Rental Classification Application (to be completed at time of closing, following approval of the City application)
  • Payment of the recording fee for the Declaration of the Restrictive Covenants (to be completed at the time of closing, following approval of the Saint Paul Application)
  • Increased tenant stability and reduced rental turnover

Program Eligibility

Property Requirements

  • The property must be a rental property located within the City of Saint Paul.
  • The property must have an inspection grade of A or B by the City of Saint Paul’s Department of Safety and Inspections (DSI), with no rental license revocations or outstanding citations.
  • A Certificate of Occupancy for the property must be valid at time of application to the 4d Program and remain valid throughout the 10-year restricted period, unless exempt per DSI guidelines.

Additional Requirements

  • Owners are required to comply with affirmative fair housing marketing practices, including non-discrimination against rental applicants with tenant-based assistance, e.g. a Section 8 voucher—should the applicants otherwise meet the owner’s rental screening guidelines.
  • In addition to wherever owners choose to advertise vacancies, owners are required to advertise vacant 4d units on HousingLink’s listings.

Affordability Requirements

4d Program eligibility is based on the preservation of affordable units for low- to moderate-income households earning up to 50% or 60% of the metropolitan Area Median Income (“AMI”).

The 2021 Area Median Income (AMI) for a family of four in the Twin Cities is $104,900.

2022 4d Program Minimum Eligible Unit Commitments

Minimum unit commitments to enroll a property in the 4d Program are:

Property Size
(# of rental units)		 Minimum Affordability Commitments
(based on Area Median Income)

1 unit
(single-family)

 All 1-unit properties must be kept affordable to households with up to 50% of AMI
2 units
(duplex)

At least 1 unit must be kept affordable to households with up to 50% of AMI

Optional: Owners may elect to commit the 2nd unit to affordability to households with up to 50% of AMI or 60% of AMI

3 or more units
(multifamily)

Option 1: 20% of units must be kept affordable to households with up to 50% of AMI

OR

Option 2: 50% of units must be kept affordable to households with up to 60% of AMI

Optional: Beyond these limits, multifamily property owners may enroll up to 100% of a property’s units at either 50% of AMI or 60% of AMI affordability.
50 or more units In addition to meeting the above 3+ unit (multifamily) affordability criteria, 50+ unit properties must also meet the requirement for this affordability must be restricted across a diverse distribution of the property's unit types in terms of size and number of bedrooms (as evidenced by rent roll), with a consideration for financial feasibility.

2021-2022 4d Program Rent Limits

Maximum monthly rent limits for 2022 are listed below, based on current Area Median Income (AMI), and adjusted by a unit’s number of bedrooms. These maximums are updated annually.

Unit size
(# of bedrooms)		 Maximum rent
50% AMI		 Maximum rent
60% AMI
Studio/efficiency 0BR $918 $1,101
1BR $984 $1,180
2BR $1,181

$1,417
3BR $1,363 $1,635
4BR $1,521 $1,825

Source: Metropolitan Council (effective June 1, 2021)

Note: the combined base rent plus allowances for the tenant’s cost of utilities cannot exceed the maximum limit. Refer to the Utilities Allowance chart in the 4d Program Guidelines.

2021-2022 4d Program Household Income Limits

After their 4d certification, units must be leased to tenants whose household income is at or below the affordability level (either 50% or 60% of AMI) designated in the property’s Declaration and as recertified annually thereafter. 4d income limits (adjusted for household size) are listed below.

Household size
(# of persons)		 Income limit
50% AMI		 Income limit
60% AMI
1 $36,750 $44,100
2 $42,000 $50,400
3 $47,250 $56,700
4 $52,450 $62,940
5 $56,650 $67,950
6 $60,850 $73,020
7 $65,050 $78,060
8 $69,250 $83,100

Source: Metropolitan Council (effective June 1, 2021)

Note: tenants with existing leases at time of the property’s 4d certification are exempt from income verification; and, thereafter, new tenants’ household incomes are verified at initial occupancy only.

Application

The 2023 4d application will be available in the fall of 2022. Specific instructions will be posted at that time.

For reference, the 2022 application information is listed below.

Application Package

Complete and submit one 2022 4d Application per property parcel, and submit with the following:

  1. A 2022 4d Rent Roll form must be included, listing the current sizes and rents of all units at your property, and identifying which will be designated as 4d units.

And, where applicable:

2a) For properties owned by INDIVIDUALS:

  • All individuals with an owning interest (including their spouses, if any) must sign the 2022 4d Application.

2b) For properties owned by a BUSINESS ENTITY:

  • A certified copy of a current Certificate of Good Standing from the Secretary of State’s webpage
  • A Business Resolution authorizing participation in the 4d Program, and designating the person with authority to execute documents on behalf of the business entity

2c) For properties owned in the name of a TRUST:

  • A fully executed trust instrument, or an unsigned (to be executed later) Certificate of Trust
  • An unsigned (to be executed later) Affidavit of Trustee

2d) For properties involving a CONTRACT FOR DEED:

  • Submission of a copy of the recorded, or if unrecorded, fully executed Contract for Deed
  • All sellers, purchasers, and spouses (if any) must sign the 2022 4d Application

2e) For properties with 50 OR MORE UNITS:

  • Submit financial documentation as relevant to your property to demonstrate the level of commitment to a diversity of unit types, in terms of its financial feasibility.

Submission

Applications must be sent either by email or mail.

Email to:

luke.odenthal@stpaul.gov

Mail to:

Luke Odenthal
ATTN: 4d application
Planning and Economic Development
City Hall Annex - Suite 1100
25 West 4th Street
Saint Paul, MN 55102

Applications are reviewed and approved on a first-come/first-serve basis. After your application is reviewed, you will receive communication as to its status and with further enrollment directions, and next steps towards the closing requirements as outlined in the Program Guidelines.

Annual Recertification

To retain 4d status, an owner must submit two separate re-certifications on an annual basis to verify the property’s compliance with the 4d Program requirements. Annual certifications to both the State and to the Saint Paul HRA must be submitted by March 31 in order to maintain a property’s 4d status.

  1. State of Minnesota Low Income Rental Classification (LIRC) Reapplication to Minnesota Housing

  2. 4d Affordable Housing Incentive Program Recertification Form to the City of Saint Paul

Last Edited: April 22, 2022