Minnesota 2025-2026 Regular Session

Minnesota House Bill HF2693 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	1.1 A bill for an act
2	2	1.2 relating to housing; establishing a locally controlled housing fund; modifying
3	3	1.3 allowable uses of housing infrastructure bonds; requiring a report; authorizing the
4	4	1.4 sale and issuance of state bonds; appropriating money; amending Minnesota
5	5	1.5 Statutes 2024, section 462A.37, subdivision 2; proposing coding for new law in
6	6	1.6 Minnesota Statutes, chapter 462A.
7	7	1.7BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
8	8	1.8 Section 1. Minnesota Statutes 2024, section 462A.37, subdivision 2, is amended to read:
9	9	1.9 Subd. 2.Authorization.(a) The agency may issue up to $30,000,000 in aggregate
10	10	1.10principal amount of housing infrastructure bonds in one or more series to which the payment
11	11	1.11made under this section may be pledged. The housing infrastructure bonds authorized in
12	12	1.12this subdivision may be issued to fund loans, or grants for the purposes of clauses (4) and
13	13	1.13(7), on terms and conditions the agency deems appropriate, made for one or more of the
14	14	1.14following purposes:
15	15	1.15 (1) to finance the costs of the construction, acquisition, and rehabilitation of supportive
16	16	1.16housing where at least 50 percent of units are set aside for individuals and families who are
17	17	1.17without a permanent residence;
18	18	1.18 (2) to finance the costs of the acquisition and rehabilitation of foreclosed or abandoned
19	19	1.19housing to be used for affordable rental housing or for affordable home ownership and the
20	20	1.20costs of new construction of rental housing on abandoned or foreclosed property where the
21	21	1.21existing structures will be demolished or removed;
22	22	1.22 (3) to finance that portion of the costs of acquisition of property that is attributable to
23	23	1.23the land to be leased by community land trusts to low- and moderate-income home buyers;
24	24	1Section 1.
25	25	REVISOR MS/KR 25-0481303/13/25
26	26	State of Minnesota
27	27	This Document can be made available
28	28	in alternative formats upon request
29	29	HOUSE OF REPRESENTATIVES
30	30	H. F. No. 2693
31	31	NINETY-FOURTH SESSION
32	32	Authored by Agbaje03/24/2025
33	33	The bill was read for the first time and referred to the Committee on Housing Finance and Policy 2.1 (4) to finance the acquisition, improvement, and infrastructure of manufactured home
34	34	2.2parks under section 462A.2035, subdivision 1b;
35	35	2.3 (5) to finance the costs of acquisition, rehabilitation, adaptive reuse, or new construction
36	36	2.4of senior housing;
37	37	2.5 (6) to finance the costs of acquisition, rehabilitation, and replacement of federally assisted
38	38	2.6rental housing and for the refinancing of costs of the construction, acquisition, and
39	39	2.7rehabilitation of federally assisted rental housing, including providing funds to refund, in
40	40	2.8whole or in part, outstanding bonds previously issued by the agency or another government
41	41	2.9unit to finance or refinance such costs;
42	42	2.10 (7) to finance the costs of acquisition, rehabilitation, adaptive reuse, or new construction
43	43	2.11of single-family housing;
44	44	2.12 (8) to finance the costs of construction, acquisition, and rehabilitation of permanent
45	45	2.13housing that is affordable to households with incomes at or below 50 percent of the area
46	46	2.14median income for the applicable county or metropolitan area as published by the United
47	47	2.15States Department of Housing and Urban Development, as adjusted for household size; and
48	48	2.16 (9) to finance the costs of construction, acquisition, rehabilitation, conversion, and
49	49	2.17development of cooperatively owned housing created under chapter 308A, 308B, or 308C
50	50	2.18that is affordable to low- and moderate-income households.
51	51	2.19 (b) Among comparable proposals for permanent supportive housing, preference shall
52	52	2.20be given to permanent supportive housing for veterans and other individuals or families
53	53	2.21who:
54	54	2.22 (1) either have been without a permanent residence for at least 12 months or at least four
55	55	2.23times in the last three years; or
56	56	2.24 (2) are at significant risk of lacking a permanent residence for 12 months or at least four
57	57	2.25times in the last three years.
58	58	2.26 (c) Among comparable proposals for senior housing, the agency must give priority to
59	59	2.27requests for projects that:
60	60	2.28 (1) demonstrate a commitment to maintaining the housing financed as affordable to
61	61	2.29senior households;
62	62	2.30 (2) leverage other sources of funding to finance the project, including the use of
63	63	2.31low-income housing tax credits;
64	64	2Section 1.
65	65	REVISOR MS/KR 25-0481303/13/25 3.1 (3) provide access to services to residents and demonstrate the ability to increase physical
66	66	3.2supports and support services as residents age and experience increasing levels of disability;
67	67	3.3and
68	68	3.4 (4) include households with incomes that do not exceed 30 percent of the median
69	69	3.5household income for the metropolitan area.
70	70	3.6 (d) To the extent practicable, the agency shall balance the loans made between projects
71	71	3.7in the metropolitan area and projects outside the metropolitan area. Of the loans made to
72	72	3.8projects outside the metropolitan area, the agency shall, to the extent practicable, balance
73	73	3.9the loans made between projects in counties or cities with a population of 20,000 or less,
74	74	3.10as established by the most recent decennial census, and projects in counties or cities with
75	75	3.11populations in excess of 20,000.
76	76	3.12 (e) Among comparable proposals for permanent housing, the agency must give preference
77	77	3.13to projects that will provide housing that is affordable to households at or below 30 percent
78	78	3.14of the area median income.
79	79	3.15 (f) If a loan recipient uses the loan for new construction as defined by the agency on a
80	80	3.16building containing more than four units, the loan recipient must construct, convert, or
81	81	3.17otherwise adapt the building to include:
82	82	3.18 (1) the greater of: (i) at least one unit; or (ii) at least five percent of units that are
83	83	3.19accessible units, and each accessible unit includes at least one roll-in shower, water closet,
84	84	3.20and kitchen work surface meeting the requirements of section 1002 of the current State
85	85	3.21Building Code Accessibility Provisions for Dwelling Units in Minnesota; and
86	86	3.22 (2) the greater of: (i) at least one unit; or (ii) at least five percent of units that are
87	87	3.23sensory-accessible units that include:
88	88	3.24 (A) soundproofing between shared walls for first and second floor units;
89	89	3.25 (B) no florescent lighting in units and common areas;
90	90	3.26 (C) low-fume paint;
91	91	3.27 (D) low-chemical carpet; and
92	92	3.28 (E) low-chemical carpet glue in units and common areas.
93	93	3.29Nothing in this paragraph relieves a project funded by the agency from meeting other
94	94	3.30applicable accessibility requirements.
95	95	3.31 (g) Bonds issued pursuant to this section for the acquisition and construction of housing
96	96	3.32may be awarded through the locally controlled housing program.
97	97	3Section 1.
98	98	REVISOR MS/KR 25-0481303/13/25 4.1 Sec. 2. [462A.44] LOCALLY CONTROLLED HOUSING PROGRAM.
99	99	4.2 Subdivision 1.Establishment.A locally controlled housing program is established for
100	100	4.3the agency to award funding to allow eligible recipients to develop or acquire housing to
101	101	4.4be owned by the recipient.
102	102	4.5 Subd. 2.Creation of accounts.Two locally controlled housing program accounts are
103	103	4.6created. One account is created in the housing development fund and one account is created
104	104	4.7in the bond proceeds fund. Money in the accounts is appropriated to the commissioner to
105	105	4.8award funding under this section. Money in the accounts is available until encumbered or
106	106	4.9spent subject to section 16A.642. Money in the locally controlled housing program account
107	107	4.10in the housing development fund consists of money appropriated to the account and
108	108	4.11transferred from other sources and all earnings from money in the account, including
109	109	4.12repayments on loans awarded under this section.
110	110	4.13 Subd. 3.Eligible recipient.(a) A city, as defined in section 462C.02, subdivision 6, or
111	111	4.14a county is eligible to apply for and receive a grant from either account established in
112	112	4.15subdivision 1.
113	113	4.16 (b) A federally recognized American Indian Tribe or a Tribally designated housing entity
114	114	4.17is eligible to apply for and receive a grant from the locally controlled housing program
115	115	4.18account in the housing development fund.
116	116	4.19 Subd. 4.Use of funds; program requirements.(a) An eligible recipient must use the
117	117	4.20proceeds for the acquisition of the predesign, design, construction, furnishing, and equipment
118	118	4.21of property for use as housing and must maintain ownership of housing funded under this
119	119	4.22section for at least 50 years after receipt of the funding.
120	120	4.23 (b) In a multifamily property funded under this section, at least 30 percent of the units
121	121	4.24must be occupied by households whose income, at the time of application or initial lease
122	122	4.25agreement, does not exceed 50 percent of the area median income as published by the United
123	123	4.26States Department of Housing and Urban Development, as adjusted for household size, and
124	124	4.27at least 30 percent of the units must be occupied by households whose income, at the time
125	125	4.28of application or initial lease agreement, does not exceed 100 percent of the area median
126	126	4.29income as published by the United States Department of Housing and Urban Development,
127	127	4.30as adjusted for household size. At the time of application or initial lease agreement, no
128	128	4.31household moving into a multifamily property funded under this section may have an income
129	129	4.32greater than 400 percent of the area median income as published by the United States
130	130	4.33Department of Housing and Urban Development, as adjusted for household size.
131	131	4Sec. 2.
132	132	REVISOR MS/KR 25-0481303/13/25 5.1 (c) In single-family property funded under this section, the homes must be occupied by
133	133	5.2households with incomes not exceeding 50 percent of the area median income as published
134	134	5.3by the United States Department of Housing and Urban Development, as adjusted for
135	135	5.4household size.
136	136	5.5 (d) An eligible recipient may act as a community land trust with respect to single-family
137	137	5.6property funded through the locally controlled housing program account in the housing
138	138	5.7development fund, provided that the recipient meets the requirements applying to a city
139	139	5.8acting as a community land trust under sections 462A.30 and 462A.31.
140	140	5.9 (e) Lease agreements with tenants in housing funded under this section must include all
141	141	5.10applicable tenant protections included in public housing lease agreements.
142	142	5.11 Subd. 5.Operation of locally controlled housing.Housing funded under this section
143	143	5.12may be operated and managed by the eligible recipient or by a third party under a lease and
144	144	5.13management contract complying with section 16A.695, subdivision 2. Except when the
145	145	5.14proceeds from the housing are pledged for repayment of the awarded funds, a recipient may
146	146	5.15use the proceeds only for the acquisition or the predesign, design, construction, furnishing,
147	147	5.16and equipment of housing to be used as affordable housing in the recipient's jurisdiction.
148	148	5.17 Subd. 6.Administration.(a) To the extent practicable:
149	149	5.18 (1) the agency must make funding available so that an approximately equal number of
150	150	5.19housing units are financed in the metropolitan area and in the nonmetropolitan area;
151	151	5.20 (2) the agency must fund projects that include accessible units, as defined in section
152	152	5.211002 of the current State Building Code Accessibility Provisions for Dwelling Units in
153	153	5.22Minnesota; and
154	154	5.23 (3) the agency must provide technical assistance to eligible recipients seeking to apply
155	155	5.24for funding under this section and to award recipients attempting to comply with the
156	156	5.25requirements of this section.
157	157	5.26 (b) Applications for funding must include a housing needs assessment that identifies the
158	158	5.27estimated range of affordability for each project.
159	159	5.28 (c) Money in the locally controlled housing program account in the bond proceeds fund
160	160	5.29must be awarded as grants. Money in the locally controlled housing development fund must
161	161	5.30be awarded as loans. The commissioner must operate the locally controlled housing program
162	162	5.31account in the housing development fund as a revolving loan fund.
163	163	5.32 Subd. 7.Reports.Beginning January 15, 2026, and each year thereafter, the
164	164	5.33commissioner must submit a report to the chairs and ranking minority members of the
165	165	5Sec. 2.
166	166	REVISOR MS/KR 25-0481303/13/25 6.1legislative committees with jurisdiction over housing finance specifying the projects that
167	167	6.2received funding under this section in the prior fiscal year.
168	168	6.3 Sec. 3. LOCALLY CONTROLLED HOUSING PROGRAM.
169	169	6.4 Subdivision 1.Appropriation.$....... is appropriated from the bond proceeds fund to
170	170	6.5the commissioner of the Housing Finance Agency for the locally controlled housing program.
171	171	6.6 Subd. 2.Bond sale.To provide the money appropriated in this section from the bond
172	172	6.7proceeds fund, the commissioner of management and budget shall sell and issue bonds of
173	173	6.8the state in an amount up to $....... in the manner, upon the terms, and with the effect
174	174	6.9prescribed by Minnesota Statutes, sections 16A.631 to 16A.675, and by the Minnesota
175	175	6.10Constitution, article XI, sections 4 to 7.
176	176	6.11 EFFECTIVE DATE.This section is effective the day following final enactment.
177	177	6.12 Sec. 4. APPROPRIATION; LOCALLY CONTROLLED HOUSING PROGRAM.
178	178	6.13 $....... in fiscal year 2026 is appropriated from the general fund to the commissioner of
179	179	6.14the Housing Finance Agency for the locally controlled housing program.
180	180	6Sec. 4.
181	181	REVISOR MS/KR 25-0481303/13/25