By Jacque Randolph*
In recent years, accessory dwelling units, or ADUs, have become a growing solution to the affordable housing crisis in the Twin Cities region. Although Minneapolis and St. Paul have had ADU ordinances for almost a decade,this movement has gained recent momentum: first through the approval of the Metropolitan Council’s Minneapolis 2040 Plan; then through a waterfall of ordinances approved by other metro cities. However, this speed has yet to translate into construction of ADUs by local lot owners.
Despite the lack of immediate development, affordable housing not-for-profits and local leaders are excited by a future involving ADUs. Accessory dwelling units are an admittedly attractive solution to segregationist housing practices: they represent community-centered neighborhoods and allow proponents to reclaim the term “higher-density” living from its exclusionary history. However, there is continued opposition from more suburban neighborhoods seeking to maintain housing and resident aesthetics, primarily through ordinances regulating lot sizes, renter requirements, and even nitpicky decorative styles.
What is an ADU?
Accessory dwelling units are homes located alongside a single- or two-family home on the same lot. ADUs operate as a smaller home or apartment, with its own kitchen, sleeping, and sanitation spaces separate from the main dwelling. Minneapolis, along with most metro cities with ADU ordinances, permit three forms of ADUs: internal, which are usually attic or basement spaces renovated into a separate apartment; attached, which share an adjacent wall of the main dwelling, like an additional wing of the house; and detached, which mirror carriage houses or over-the-garage apartments.
ADUs as a housing solution grew from housing resegregation policies from the 1980s and the subsequent lapse in available affordable housing. Despite neighborhood integration practices from the Metropolitan Council through the 1960–70s, this process collapsed through the recalibration of subsidized housing construction policy. Not-for-profit organizations prioritized construction projects in already lower-income, lower-resource areas instead of equally dispersing housing across a variety of neighborhoods in the region. Efforts also included a higher concentration of Low-Income Housing Tax Credit units in already segregated neighborhoods. These strategies created a “feedback loop of segregation” which kept individuals relying on affordable housing concentrated in already suffering neighborhoods. Mass creation of affordable housing also, due to racialized views of lot opportunity and wealth, triggered larger-scale disinvestment in the neighborhood leading to higher levels of foreclosure or turnover and discounted resale to modern developers.
The Metro Council sought to combat this history through centering their comprehensive Minneapolis 2040 Plan on the elimination of disparities experienced by communities of color. The Council emphasized housing disparities as their primary focus, noting the goal of the comprehensive plan as “undo[ing] the legacy that remains from racially discriminatory housing policies by increasing access to opportunity through a greater diversity of housing types, especially in areas that lack housing options as a result of discriminatory housing policy.” Encouraging mixed income housing and crafting innovative housing types such as accessory dwelling units fall under this focus.
ADUs seemingly solve several issues present in the Twin Cities’ housing structure. Because ADUs operate as second, smaller home or apartment on a lot, they diversify housing options by creating a larger variety in nontraditional floorplans. It satisfies the need for smaller, single-room occupancy spaces as well as options for individuals seeking shared housing or more independent lifestyles outside of costly assisted living communities. They also fill a need for more flexible and affordable housing for intergenerational households that are more likely to be families of color or reflect non-traditional nuclear familial structures.
ADUs also offer rental opportunities for families unable to reside in neighborhoods that primarily consist of home-purchasers. Much of the housing segregation within Minneapolis also reflects massive disparities between owner-occupied and renter-occupied units divided along racial and income lines. Offering rental opportunities within suburban areas provides families the ability to enter those spaces at a more reasonable cost and take advantage of resources traditionally saved for Minneapolis homeowners, such as better public schools. This accessibility also improves potential for family mobility and an intentional step towards creating intergenerational wealth for Black communities and communities of color which have lost that connection through housing division.
Although ADU permits have been available to Minneapolis residents since 2014, the 2040 Plan has set encouragement for the structures at the forefront. Initiatives such as increasing accessibility of construction permits and action plans have slowly increased the number of ADUs built in Minneapolis. However, there is still a lapse in construction. As of 2019, Minneapolis approved 137 ADUs, or only 0.2 percent of single-family lots in the city.For reference, Portland, a leading city in ADU implementation, has units on about 1.5 percent of single-family lots.Minneapolis would need roughly 1,200 ADUs to reach that point.
Following the approval of the Minneapolis 2040 Plan, the Metropolitan Council focused on increasing accessibility of accessory dwelling unit development through easier, almost automatic, permit approval and a mass rezoning to allow ADUs on almost all lots. However, this improved ease of access did not increase the number of ADUs constructed, mainly due to construction regulations which spike costs and risks for owners interested in building.
Different forms of ADUs necessitate different construction requirements. For example, internal and attached ADUs built in Minneapolis must be between 300 and 800 square feet. Detached ADUs have a higher maximum size of 1300 square feet, however this must also not exceed a certain percentage of the lot size and must include allotted space for parking. Regardless of style, cities require ADUs to be smaller than the primary dwelling on the property.
Although size restrictions are reasonable, these ordinances can be used to restrict the pool of applicable renters. For example, Roseville places heavy restrictions on the size and number of occupants allowed. Occupancy is limited to two people, with a maximum of one bedroom in the unit. Similarly, the square footage is restricted to a firm maximum of “75% of the principal dwelling’s four season living area” or allegedly a ‘soft-maximum’ of “650 square feet of living area.” These arbitrary restrictions block families from renting on properties large enough to fit non-traditional – i.e., three or more bedroom – ADUs, therefore continuing to harm individuals ADUs are expected to assist.
The most harmful ordinances for ADU construction are owner-occupancy regulations. Owner-occupancy requires the owner of the lot to occupy “at least one dwelling unit” on the lot as their “primary place of residence.”These regulations, a remnant of past discriminatory zoning policies, continue to be one of the primary factors complicating construction.
Owner-occupancy regulations exacerbate financial issues associated with construction. The costs of constructing an ADU range anywhere from $140,000.00 to $320,000.00. Renovating an already-existing structure, such as an attic for an internal ADU or a detached over-the-garage unit is equally as costly. These costs push lot owners to seek loans to complete these projects. However, lenders are less likely to loan to individuals seeking to construct an ADU that is bound by owner-occupancy covenants, because it prevents future use of the property by lenders in the event of forfeit. Requiring an owner to occupy at least one dwelling on the property subverts opportunities of lenders to rent foreclosed property. If lenders are unable to easily rent foreclosed property as a return, they are less interested in taking the initial loan risk. This limits the availability of loans for families looking to build equity on the property and restricts ADU construction to families with enough disposable income to dedicate to a lengthy construction project.
Owner-occupancy regulations also declaw the effectiveness of ADUs in diversifying neighborhoods. Requiring the owner to live on the premises pushes them to adopt the role of a more directly involved and supervisory landlord. These regulations also push lot owners to rent to individual, shorter-term tenants such as professionals or graduate students or keep the space for personal or familial use. As such, owner-occupancy requirements have become a shortcut to upholding the “character” of a neighborhood without utilizing similarly restrictive and racially coded regulations like “blight ordinances” or “noise ordinances.”
Modifying ordinances on accessory dwelling units is the next step in encouraging construction. These restrictions, along with some of the more intensive decorative ordinances in some metro cities, emphasize subjective view on the adequacy and aesthetics of livability while also recycling historic methods of restrictive housing. Although regulations on housing do ensure that residents have safe places to live, encouraging development on ADUs requires a recalibration of the types of restrictions on home construction as well as the sources and underlying discriminatory goals of these codes.
This process requires not only deconstructing opposition concerning the preservation of neighborhood aesthetics and renter stereotypes and the acknowledgement of segregationist past practices, but also the involvement of community members affected. Although it is necessary to note that ADUs are a long-term solution, involving Black families and families of color within these conversations should not wait until the city constructs a set number of units. Instead, the development process, in terms of both ordinance adaptation and informational updates or feedback, should be extended to the communities needing these shifts in affordable housing.
 Mark Theiroff, Accessory Dwelling Units: A Tale of Two Cities, Streets.MN (Mar. 20, 2018), https://streets.mn/2018/03/20/accessory-dwelling-units-a-tale-of-two-cities/.
 Katelyn Vue, Golden Valley Legalizes Accessory Dwelling Units, StarTribune (Nov. 2, 2022), https://www.startribune.com/golden-valley-legalizes-accessory-dwelling-units/600221339/.
 Despite focusing our conversations on heavier topics, everyone I interviewed involved in this area was still excited about ADUs and the future they could bring. See, e.g., Telephone Interview with Jamie Stolpestad, Neighbors for More Neighbors (Nov. 1, 2022). Similarly, not-for-profits and local architects have released pamphlets, action plans, and design deals to assist lot owners looking to construct ADUs. See, e.g., Home + Home: Twin Cities ADU Guidebook, Family Housing Fund (Feb. 2019); Christopher Strom Architects, Second Suite, secondsuite.org (last visited Feb. 22, 2023).
 Telephone Interview with Ericka Brown, Cmty. Dev. Manager, Minn. Hous. P’ship (Oct. 31, 2022).
 Jessica Lee & Greta Kaul, Accessory Dwelling Units Were Supposed to Help Ease the Twin Cities’ Housing Crunch. How’s That Working Out?, Minnpost (May 1, 2019), https://www.minnpost.com/metro/2019/05/accessory-dwelling-units-were-supposed-to-help-ease-the-twin-cities-housing-crunch-hows-that-working-out/.
 Myron Orfield & Will Stancil, Why Are the Twin Cities So Segregated?, 43 Mitchell Hamline L. Rev. 1, 24–26 (2017).
 Inst. On Metro. Opportunity, Comments on the Minneapolis Draft 2040 Plan 2 (2018).
 Orfield & Stancil, supra note 5, at 31.
 Id. at 32.
 Metro. Council, Minneapolis 2040 Comprehensive Plan 8 (2019).
 Id. at 12.
 Telephone Interview with Karyssa Scheck, Family Hous. Fund (Nov. 2, 2022).
 Margaret F. Brinig & Nicole Stelle Garnett, A Room of One’s Own: Accessory Dwelling Unit Reforms and Local Parochialism, 45 Urb. Law.519, 529–30 (2013).
 See Inst. On Metro. Opportunity, supra note 6, at 25 tbls. 11 & 12.
 Orfield & Stancil, supra note 5, at 32–47 (discussing relationship between housing segregation and segregation in public schooling).
 Brinig & Garnett, supra note 12 at 533–34; see Patrick Sharkey, Stuck in Place (2013) (describing how lower-income Black families are more likely to be stuck in neighborhoods for multiple generations, unlike white lower-income families).
 Lee & Kaul, supra note 4.
 City of Minn. Cmty. Plan. and Econ. Dev., Administrative Review for an Accessory Dwelling Unit (2022).
 Lee & Kaul, supra note 4. Documentation for the number of ADU permits approved following the approval of the Minneapolis 2040 plan is unclear, with no consistent collection process between cities and municipalities. Telephone Interview with Karyssa Scheck, supra note 11.
 Lee & Kaul, supra note 4.
 Roseville § 1011.12(B)(1)(d), (i)(iii).
 Roseville § 1011.12(B)(1)(i(ii).
 See Gabriel Metcalf, Sand Castles Before the Tide? Affordable Housing in Expensive Cities, 32 J. Econ. Perspectives 59, 67 (2018) (discussing how these regulations also “embody judgments regarding what constitutes ‘decent’ housing”).
 Minneapolis, Minn., Code of Ordinances § 537.110 (2022).
 Lee & Kaul, supra note 4.
 Telephone Interview with Ericka Brown, supra note 3.
 Brinig & Garnett, supra note 12 at 521–22.
 John Infranca, Housing Changing Household: Regulatory Challenges for Micro-Units and Accessory Dwelling Units, 25 Stan. L. Pol’y Rev. 53, 62 (2014).
 Brinig & Garnett, supra note 12 at 522.
 For an example on visual requirements of ADUs in Roseville, MN, see Roseville § 1011.12(B)(1)(k) (“appearance or character of the principal building shall not be significantly altered so that its appearance is no longer that of a one-family dwelling”).
 See Metcalf, supra note 27. Although this opposition has recently been characterized through the term “NIMBY” (Not In My Back Yard), this harkens back to ‘redlining’ and similar practices which used “exclusionary land regulations as a form of home-value insurance” for white suburban homeowners. Brinig & Garnett, supra note 12 at 520.
*Jacque Randolph is a staff member on the Journal of Law & Inequality Vol. 41.