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5 <br /> <br />purchasing NOAH properties. The CAP agency has focused on smaller buildings, mostly <br />duplexes to eight plexes, with the idea of housing county clients. Acquiring smaller NOAH <br />properties can be a special challenge, because groups like Aeon and CommonBond are mostly <br />looking for larger properties where economies of scale make acquisition more feasible. In <br />Minneapolis, however, smaller rental properties predominate. The City is proposing a Small and <br />Medium Multifamily Land Banking Pilot (SMMF Pilot) in which the Twin Cities Land Bank, <br />Twin Cities LISC, and Family Housing Fund, in partnership with the City, have developed a <br />program to help stabilize 2-49 unit buildings that are occupied by low to moderate income <br />tenants throughout Minneapolis and that are particularly susceptible to market pressures. The <br />goal of the program is to remove these properties from the speculative market and restrict them <br />as affordable for the long-term. <br /> <br />Huge challenges remain, however, in moving a significant share of NOAH housing into <br />the hands of owners committed to long term affordability. The competition among market rate <br />developers to purchase these properties is intense, and requires not only the ability to compete on <br />price but on timeliness of performance, as many investor-purchasers are prepared to pay cash <br />and close quickly. One set of strategies to avoid displacement of low income renters and <br />preserve affordable housing involves facilitating purchase of threatened affordable properties by <br />preservation buyers. These strategies have proved effective in a number of places and <br />circumstances. The strategies lie along a spectrum of obligations imposed on a prospective seller <br />from providing preservation buyers with the right to match another buyer’s offer (known as a <br />right of first refusal, “ROFR”) to requiring potential sellers to negotiate with preservation buyers <br />prior to consummating a sale to another buyer (Opportunity to purchase, “OTP”) to provisions <br />requiring notice to residents and affected local governments prior to completing a sale. What <br />follows are descriptions of a variety of circumstances for which such laws have been adopted <br />and of key elements of such laws. Public officials thinking about enacting one of these strategies <br />should familiarize themselves with comparable laws and policies currently in use. We’ve <br />provided footnotes with citations to each. <br /> <br />Preserving assisted lower income housing. There are quite a number of such state and <br />local laws aimed at preserving federally and locally subsidized housing. Chicago,3 Denver,4 and <br /> <br />3 CHI., ILL. CODE OF ORDINANCES § 2-45-140; see Affordable Housing Preservation Ordinance, <br />CITY OF CHI., <br />https://www.cityofchicago.org/city/en/depts/dcd/supp_info/affordable_housingnotificationordina <br />nce.html (last visited July 6, 2018). Note that the Illinois Federally Assisted Housing <br />Preservation Act (310 ILL. COMP. STAT. 60/) imposes an opportunity to purchase duty on an <br />owner intending to sell or opt out requiring an offer to residents. The Chicago ordinance goes <br />beyond that to require a ROFR. It provides for a private right of action and for fines. <br />4 Denver City and County Municipal Code §§ 27-45 to 27-52 requires notice of loss of subsidy <br />and provides the City with a ROFR if the owner decides to sell. The ROFR allows the City or a <br />preservation designee to purchase the project “on terms that are economically substantially <br />identical” to the terms agreed to with a buyer. Any purchase agreement with a buyer must be <br />contingent on the City’s ROFR. Section 27-49 provides a similar ROFR regarding city-funded <br />projects.