It suggests that only 13 percent of new units should be allocated in the core cities, and allocates large shares to suburban job centers. But the actual share of affordable housing funding spent in the cities is somewhere closer to 40 or 50 percent of the regional total. That has very real consequences for the perpetuation of economic and racial segregation in the region.
It's not just about it being in Minneapolis, either: I'd be a lot more inclined to support a project like Five15 if it were elsewhere in the city. But that disproportionate central city investment is almost invariably dumped into large-scale projects located in the city's poorest and most racially segregated neighborhoods. Five15 itself is about the worst example of this in recent memory: it's literally wedged into a corner behind the city's largest affordable housing complex, which is itself notoriously segregated. (As I mentioned earlier, it's so bad it probably violates the Fair Housing Act, although that's neither here nor there until someone steps up to make a complaint.)
I'm not sure I follow your reasoning on rent restrictions. It's important whether a unit is rent-restricted because that determines whether it qualifies for subsidy, whether it must accept Section 8 vouchers, and whether it can accept middle- or high-income tenants. But market-rate units (as defined for the purposes of allocating LIHTC and other subsidies) are still accessible to lower incomes, because they can still be lower than the regional average and because people can simply dedicate a larger chunk of their monthly income to rent than LIHTC allows.
But it's true there's a lot less difference between a rent-restricted unit and a market-rate unit in Cedar-Riverside than in, say, Uptown, or Edina. That's the point: you're dumping a lot of money into projects to create housing opportunities that aren't that very distinct from the housing that already exists in these neighborhoods.
If you've got evidence of affordable housing attracting transformative private investment to a traditionally distressed neighborhood, please share it. Even the evidence of LIHTC revitalization seems to suggest that it's more at the margins than catalytic. I wasn't around the cities in the 90s, but my understanding is that North Loop and the Mill District weren't segregated concentrations of poverty -- they were just largely undeveloped. That's obviously very different than the present case, where you're putting housing for poor people in a neighborhood that already contains a lot of poor people.
Finally, the MinnPost article isn't describing the provision of "housing across the rent spectrum," an outcome I would of course support. It's describing (as a positive) the concentration of affordable housing in poor neighborhoods:
In fact, if you pinpoint the new and pending developments on a map of the Green Line, you'd find most of the market-rate housing bunched where market-rate housing already exists: in Minneapolis' North Loop and Downtown East neighborhoods and in downtown St. Paul. Affordable units are concentrated in Frogtown and along University Avenue. Environs around the U of M will be receiving large clumps of — duh — student housing.
If you'll look at the people behind the Big Picture report, you'll see that the majority of them are affordable housing developers (or are from organizations intimately involved in its construction, like LISC).
(As for my background, I think my concern about segregration should make clear that I'm coming to this from a fair housing perspective first and foremost, but I don't think that's at all incompatible with the urbanist priorities you more typically see around here. Complementary, more like.)