1.1 A bill for an act
1.2 relating to state government; proposing an amendment to the Minnesota
1.3 Constitution, article XI; increasing the sales tax rate by three-eighths of one percent
1.4 and dedicating the receipts for housing purposes; creating a homeownership
1.5 opportunity fund, a community and household stability fund, and a rental
1.6 opportunity fund; creating fund councils; providing appointments; requiring reports;
1.7 proposing coding for new law in Minnesota Statutes, chapters 256K; 462A.
1.8BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.9 ARTICLE 1
1.10 CONSTITUTIONAL AMENDMENT TO FUND HOUSING INITIATIVES
1.11 Section 1. CONSTITUTIONAL AMENDMENT PROPOSED.
1.12 An amendment to the Minnesota Constitution is proposed to the people. If the amendment
1.13is adopted, a section shall be added to article XI to read:
1.14 Sec. 16. Beginning July 1, 2027, until June 30, 2052, the sales and use tax rate shall be
1.15increased by three-eighths of one percent on sales and uses taxable under the general sales
1.16and use tax law. Receipts from the increase, plus penalties and interest and reduced by any
1.17refunds, are dedicated, for the benefit of Minnesotans, to the following funds: 25 percent
1.18to the homeownership opportunity fund, which may be spent to assist in the creation,
1.19purchase, and rehabilitation of homes for owner occupancy; 25 percent to the community
1.20and household stability fund, which may be used to assist in providing emergency financial
1.21assistance, legal services, educational services, and outreach services to persons who are
1.22homeless or at risk of becoming homeless; and 50 percent to the rental opportunity fund,
1.23which may be used to assist in funding ongoing rental assistance and supportive services
1.24for renters and in the acquisition, development, rehabilitation, or adaptive reuse of rental
1Article 1 Section 1.
REVISOR MS/LJ 25-0307902/18/25
State of Minnesota
This Document can be made available
in alternative formats upon request
HOUSE OF REPRESENTATIVES
H. F. No. 3279
NINETY-FOURTH SESSION
Authored by Howard, Hussein, Kozlowski, Hollins, Finke and others05/01/2025
The bill was read for the first time and referred to the Committee on Housing Finance and Policy 2.1housing. A homeownership opportunity fund, a community and household stability fund,
2.2and a rental opportunity fund are created in the state treasury. The money dedicated under
2.3this section shall be appropriated by law. The dedicated money under this section must
2.4supplement traditional sources of funding for these purposes and may not be used as a
2.5substitute. The dedicated money under this section may be used to provide matching grants.
2.6 Sec. 2. SUBMISSION TO VOTERS.
2.7 (a) The proposed amendment must be submitted to the people at the 2026 general election.
2.8The question submitted must be:
2.9 "Shall the Minnesota Constitution be amended to remove barriers to homeownership,
2.10to make rental housing safe and affordable, and to protect vulnerable households and
2.11communities from displacement and homelessness by increasing the sales and use tax rate
2.12beginning July 1, 2027, by three-eighths of one percent on taxable sales until the year 2052?
2.13 Yes ...................
"2.14 No ....................
2.15 (b) The title required under Minnesota Statutes, section 204D.15, subdivision 1, for the
2.16question submitted to the people under paragraph (a) shall be: "Creation of Homeownership
2.17Opportunity Fund, Community and Household Stability Fund, and Rental Opportunity
2.18Fund."
2.19 ARTICLE 2
2.20 STATUTORY CHANGES
2.21 Section 1. [256K.50] COMMUNITY AND HOUSEHOLD STABILITY FUND.
2.22 Subdivision 1.Fund.The community and household stability fund is established in the
2.23Minnesota Constitution, article XI, section 16. All money earned by the fund must be credited
2.24to the fund.
2.25 Subd. 2.Purpose.The fund is established to help Minnesotans improve the condition
2.26of homes and communities and prevent homelessness and displacement from homes.
2.27 Subd. 3.Expenditures.Subject to appropriation, receipts in the fund may be spent for:
2.28 (1) emergency assistance for households or individuals that are homeless or at risk of
2.29homelessness or displacement;
2.30 (2) legal services for households or individuals that are homeless or at risk of
2.31homelessness or displacement;
2Article 2 Section 1.
REVISOR MS/LJ 25-0307902/18/25 3.1 (3) outreach services for households or individuals that are homeless or at risk of
3.2homelessness or displacement;
3.3 (4) funding the operation of emergency shelters; and
3.4 (5) financing the acquisition, rehabilitation, adaptive reuse, or new construction of
3.5property to serve as emergency shelter, transitional housing, or permanent supportive
3.6housing.
3.7 Subd. 4.Audit.The legislative auditor shall audit fund expenditures to ensure that the
3.8money is spent for the purposes for which it is constitutionally dedicated and for which the
3.9money was appropriated.
3.10 Subd. 5.Prevailing wages.Contracts for projects funded by this fund must meet the
3.11requirements of contracts for state projects, as established in section 177.43.
3.12 Sec. 2. [256K.51] COMMUNITY AND HOUSEHOLD STABILITY COUNCIL.
3.13 Subdivision 1.Establishment.A Community and Household Stability Council is created
3.14to advise on the administration and implementation of the community and household stability
3.15fund under section 256K.50. The Housing Finance Agency shall provide administrative
3.16support for the council. The members of the council shall elect a chair from the voting
3.17members of the council.
3.18 Subd. 2.Membership; appointment.(a) Three members of the house of representatives,
3.19including two members from the majority party, appointed by the speaker of the house, and
3.20one member from the minority party, appointed by the minority leader, shall serve at the
3.21pleasure of the appointing authority as nonvoting members of the council. Three members
3.22of the senate, including two members from the majority party and one member from the
3.23minority party, appointed according to the rules of the senate, shall serve at the pleasure of
3.24the appointing authority as nonvoting members of the council.
3.25 (b) Twenty-four voting members shall be appointed and must include:
3.26 (1) one representative of a labor union;
3.27 (2) the commissioner of the Housing Finance Agency;
3.28 (3) four representatives of organizations that work directly with under-resourced or
3.29underrepresented communities;
3.30 (4) four members who receive or previously received support services, emergency rental
3.31assistance, or homeless prevention services;
3Article 2 Sec. 2.
REVISOR MS/LJ 25-0307902/18/25 4.1 (5) two members representing a Tribal government;
4.2 (6) one member elected to or appointed by the governing body of a local government;
4.3 (7) one member that represents either a public housing authority or a housing and
4.4redevelopment authority; and
4.5 (8) one member representing the Council on Disability.
4.6 (c) Appointments shall be made as follows: the governor, the senate majority leader,
4.7and the speaker of the house shall each in turn appoint members required under paragraph
4.8(b) until 12 appointments have been made. The governor shall appoint an additional eight
4.9members, ensuring that any outstanding requirements under paragraph (b) are satisfied. The
4.10house minority leader and the senate minority leader shall then each appoint two members.
4.11Members appointed under this paragraph must not be registered lobbyists or legislators.
4.12 (d) Appointing authorities shall ensure that appointees represent a diversity of
4.13backgrounds, including racial, ethnic, socioeconomic, and geographic backgrounds.
4.14 Subd. 3.Conflict of interest.A council member may not participate in or vote on a
4.15decision of the council relating to an organization in which the member has either a direct
4.16or indirect personal financial interest. While serving on the council, a member shall avoid
4.17any potential conflict of interest.
4.18 Subd. 4.Terms; compensation; removal.The terms of members representing the state
4.19agencies are four years and are coterminous with the governor. The terms of other
4.20nonlegislative members of the council shall be as provided in section 15.059, subdivision
4.212. Members may serve until their successors are appointed and qualify. Compensation and
4.22removal of nonlegislative council members is as provided in section 15.059, subdivisions
4.233 and 4. Compensation of legislative members is as determined by the appointing authority.
4.24The Department of Human Services may reimburse legislative members for expenses. A
4.25vacancy on the council may be filled by the appointing authority provided in subdivision 2
4.26for the remainder of the unexpired term.
4.27 Subd. 5.Strategic plan.The council shall adopt a strategic plan for recommending
4.28policy changes and making expenditures from the community and household stability fund
4.29that further the purpose in section 256K.50, subdivision 2, including identifying the priority
4.30areas for funding for the next six years. The council shall issue a revised plan by December
4.311 each even-numbered year. The strategic plan must have clearly stated short- and long-term
4.32goals and strategies for fund expenditures, must provide measurable outcomes for
4.33expenditures, and must determine areas of emphasis for funding. The council's strategic
4Article 2 Sec. 2.
REVISOR MS/LJ 25-0307902/18/25 5.1plan must detail how the council will engage impacted individuals and communities and
5.2ensure council recommendations support the fund's purpose and the intention to reduce
5.3disparities, support community-based solutions, improve the condition of homes, increase
5.4accessibility, and improve energy and water efficiency.
5.5 Subd. 6.Recommended appropriations.The Community and Household Stability
5.6Council shall recommend to the governor and the legislature the manner in which money
5.7from the community and household stability fund should be appropriated for the purposes
5.8stated in section 256K.50 and the Minnesota Constitution, article XI, section 16.
5.9 Subd. 7.Reports to legislature.(a) By January 15 of each odd-numbered year, the
5.10council must submit a report to the chairs and ranking minority members of the legislative
5.11committees with jurisdiction over housing and jurisdiction over taxes on the activities for
5.12which money has been or will be spent for the current biennium and the activities for which
5.13money is recommended to be spent in the next biennium.
5.14 (b) By January 15 of each even-numbered year, the council may submit to the legislature
5.15supplemental recommendations on the manner in which money from the community and
5.16household stability fund should be appropriated in the next fiscal year.
5.17 Sec. 3. [462A.51] HOMEOWNERSHIP OPPORTUNITY FUND.
5.18 Subdivision 1.Fund.The homeownership opportunity fund is established in the
5.19Minnesota Constitution, article XI, section 16. All money earned by the fund must be credited
5.20to the fund.
5.21 Subd. 2.Purpose.The fund is established to support Minnesotans and the communities
5.22in which they live, to eliminate racial disparities in homeownership, to ensure Minnesotans
5.23can accumulate wealth and assets, and to increase quality of life by helping more first-time
5.24home buyers afford and access homeownership.
5.25 Subd. 3.Expenditures.Subject to appropriation, receipts in the fund may be spent for:
5.26 (1) financing the acquisition, rehabilitation, adaptive reuse, or new construction of
5.27property to serve as owner-occupied housing, including single-family housing, multifamily
5.28housing containing up to four units, housing on land leased by a community land trust,
5.29condominiums, and cooperatively owned housing, including cooperatively owned
5.30manufactured home parks;
5.31 (2) financing the conversion of rental property into owner-occupied property, including
5.32cooperatively owned housing and cooperatively owned manufactured home parks;
5Article 2 Sec. 3.
REVISOR MS/LJ 25-0307902/18/25 6.1 (2) down payment assistance;
6.2 (3) accessibility grants and loans for owner-occupied housing;
6.3 (4) financial assistance to borrowers who are delinquent on mortgage or contract for
6.4deed payments; and
6.5 (5) homeownership education, counseling, and training under section 462A.209.
6.6 Subd. 4.Audit.The legislative auditor shall audit fund expenditures to ensure that the
6.7money is spent for the purposes for which it is constitutionally dedicated and for which the
6.8money was appropriated.
6.9 Subd. 5.Prevailing wages.Contracts for projects funded by this fund must meet the
6.10requirements of contracts for state projects, as established in section 177.43.
6.11 Sec. 4. [462A.52] HOMEOWNERSHIP OPPORTUNITY COUNCIL.
6.12 Subdivision 1.Establishment.A Homeownership Opportunity Council is created to
6.13advise on the administration and implementation of the homeownership opportunity fund
6.14under section 462A.51. The Housing Finance Agency shall provide administrative support
6.15for the council. The members of the council shall elect a chair from the voting members of
6.16the council.
6.17 Subd. 2.Membership; appointment.(a) Three members of the house of representatives,
6.18including two members from the majority party, appointed by the speaker of the house, and
6.19one member from the minority party, appointed by the minority leader, shall serve at the
6.20pleasure of the appointing authority as nonvoting members of the council. Three members
6.21of the senate, including two members from the majority party and one member from the
6.22minority party, appointed according to the rules of the senate, shall serve at the pleasure of
6.23the appointing authority as nonvoting members of the council.
6.24 (b) Twenty-four voting members shall be appointed and must include:
6.25 (1) the commissioner of the Housing Finance Agency;
6.26 (2) one member that represents either a public housing authority or a housing and
6.27redevelopment authority;
6.28 (3) one representative of a labor union;
6.29 (4) two members who purchased a Habitat for Humanity home;
6.30 (5) two members who purchased a community land trust home;
6.31 (6) two members who have been or are manufactured home park residents;
6Article 2 Sec. 4.
REVISOR MS/LJ 25-0307902/18/25 7.1 (7) two members who live in a cooperatively owned property;
7.2 (8) two representatives of organizations focused on producing new affordable homes
7.3for ownership;
7.4 (9) one representative of an organization that provides down payment assistance or home
7.5buyer preparation services to low-income households;
7.6 (10) two representatives of organizations that work directly with households on the path
7.7to homeownership;
7.8 (11) one member elected to or appointed by the governing body of a local government;
7.9 (12) two representatives of a Tribal government;
7.10 (13) one person with a disability or one disability advocate; and
7.11 (14) one person with practical experience or expertise with both housing and either
7.12energy or climate.
7.13 (c) Appointments shall be made as follows: the governor, the senate majority leader,
7.14and the speaker of the house shall each in turn appoint members required under paragraph
7.15(b) until 12 appointments have been made. The governor shall appoint an additional eight
7.16members, ensuring that any outstanding requirements under paragraph (b) are satisfied. The
7.17house minority leader and the senate minority leader shall then each appoint two members.
7.18Members appointed under this paragraph must not be registered lobbyists or legislators.
7.19 (d) Appointing authorities shall ensure that appointees represent a diversity of
7.20backgrounds, including racial, ethnic, socioeconomic, and geographic backgrounds.
7.21 Subd. 3.Conflict of interest.A council member may not participate in or vote on a
7.22decision of the council relating to an organization in which the member has either a direct
7.23or indirect personal financial interest. While serving on the council, a member shall avoid
7.24any potential conflict of interest.
7.25 Subd. 4.Terms; compensation; removal.The terms of members representing the state
7.26agencies are four years and are coterminous with the governor. The terms of other
7.27nonlegislative members of the council shall be as provided in section 15.059, subdivision
7.282. Members may serve until their successors are appointed and qualify. Compensation and
7.29removal of nonlegislative council members is as provided in section 15.059, subdivisions
7.303 and 4. Compensation of legislative members is as determined by the appointing authority.
7.31The agency may reimburse legislative members for expenses. A vacancy on the council
7Article 2 Sec. 4.
REVISOR MS/LJ 25-0307902/18/25 8.1may be filled by the appointing authority provided in subdivision 2 for the remainder of the
8.2unexpired term.
8.3 Subd. 5.Strategic plan.The council shall adopt a strategic plan for recommending
8.4policy changes and making expenditures from the homeownership opportunity fund that
8.5further the purpose in section 462A.51, subdivision 2, including identifying the priority
8.6areas for funding for the next six years. The council shall issue a revised plan by December
8.71 of each even-numbered year. The strategic plan must have clearly stated short- and
8.8long-term goals and strategies for fund expenditures, must provide measurable outcomes
8.9for expenditures, and must determine areas of emphasis for funding. The council's strategic
8.10plan must detail how the council will engage impacted individuals and communities and
8.11ensure council recommendations support the fund's purpose and the intention to reduce
8.12disparities, support community-based solutions, improve the condition of homes, increase
8.13accessibility, and improve energy and water efficiency.
8.14 Subd. 6.Recommended appropriations.The Homeownership Opportunity Council
8.15shall recommend to the governor and the legislature the manner in which money from the
8.16homeownership opportunity fund should be appropriated for the purposes stated in section
8.17462A.51 and the Minnesota Constitution, article XI, section 16.
8.18 Subd. 7.Reports to legislature.(a) By January 15 of each odd-numbered year, the
8.19council must submit a report to the chairs and ranking minority members of the legislative
8.20committees with jurisdiction over housing and jurisdiction over taxes on the activities for
8.21which money has been or will be spent for the current biennium and the activities for which
8.22money is recommended to be spent in the next biennium.
8.23 (b) By January 15 of each even-numbered year, the council may submit to the legislature
8.24supplemental recommendations on the manner in which money from the homeownership
8.25opportunity fund should be appropriated in the next fiscal year.
8.26 Sec. 5. [462A.53] RENTAL OPPORTUNITY FUND.
8.27 Subdivision 1.Fund.The rental opportunity fund is established in the Minnesota
8.28Constitution, article XI, section 16. All money earned by the fund must be credited to the
8.29fund.
8.30 Subd. 2.Purpose.The fund is established to create more homes that Minnesotans can
8.31afford by increasing the supply of affordable rental housing, especially for very low- and
8.32extremely low-income households; reduce the number of low-income households
8Article 2 Sec. 5.
REVISOR MS/LJ 25-0307902/18/25 9.1experiencing housing cost burden by investing in rental assistance; and improve quality of
9.2life by ensuring existing homes are safe, healthy, and resilient.
9.3 Subd. 3.Expenditures.Subject to appropriation, receipts in the fund must be spent for:
9.4 (1) financing the acquisition, rehabilitation, adaptive reuse, or new construction of
9.5property to serve as rental housing;
9.6 (2) rental assistance; and
9.7 (3) supportive services to renters and owners of rental property.
9.8 Subd. 4.Audit.The legislative auditor shall audit fund expenditures to ensure that the
9.9money is spent for the purposes for which it is constitutionally dedicated and for which the
9.10money was appropriated.
9.11 Subd. 5.Prevailing wages.Contracts for projects funded by this fund must meet the
9.12requirements of contracts for state projects, as established in section 177.43.
9.13 Sec. 6. [462A.54] RENTAL OPPORTUNITY COUNCIL.
9.14 Subdivision 1.Establishment.A Rental Opportunity Council is created to advise on
9.15the administration and implementation of the rental opportunity fund under section 462A.53.
9.16The Housing Finance Agency shall provide administrative support for the council. The
9.17members of the council shall elect a chair from the voting members of the council.
9.18 Subd. 2.Membership; appointment.(a) Three members of the house of representatives,
9.19including two members from the majority party, appointed by the speaker of the house, and
9.20one member from the minority party, appointed by the minority leader, shall serve at the
9.21pleasure of the appointing authority as nonvoting members of the council. Three members
9.22of the senate, including two members from the majority party and one member from the
9.23minority party, appointed according to the rules of the senate, shall serve at the pleasure of
9.24the appointing authority as nonvoting members of the council.
9.25 (b) Twenty-four voting members shall be appointed and must include:
9.26 (1) the commissioner of the Housing Finance Agency;
9.27 (2) one representative of a labor union;
9.28 (3) one member that represents either a public housing authority or a housing or
9.29redevelopment authority;
9.30 (4) one member living in rental housing who (i) has a disability, and (ii) transitioned out
9.31of congregate care;
9Article 2 Sec. 6.
REVISOR MS/LJ 25-0307902/18/25 10.1 (5) one member who is experiencing or has experienced homelessness;
10.2 (6) two representatives of a Tribal government;
10.3 (7) one representative of a nonprofit housing provider;
10.4 (8) one representative of a for-profit housing provider;
10.5 (9) one representative of a nonprofit developer of rental housing; and
10.6 (10) one representative of a for-profit developer of rental housing.
10.7 (c) Appointments shall be made as follows: the governor, the senate majority leader,
10.8and the speaker of the house shall each in turn appoint members required under paragraph
10.9(b) until 12 appointments have been made. The governor shall appoint an additional eight
10.10members, ensuring that any outstanding requirements under paragraph (b) are satisfied. The
10.11house minority leader and the senate minority leader shall then each appoint two members.
10.12Members appointed under this paragraph must not be registered lobbyists or legislators.
10.13 (d) Appointing authorities shall ensure that appointees represent a diversity of
10.14backgrounds, including racial, ethnic, socioeconomic, and geographic backgrounds.
10.15 Subd. 3.Conflict of interest.A council member may not participate in or vote on a
10.16decision of the council relating to an organization in which the member has either a direct
10.17or indirect personal financial interest. While serving on the council, a member shall avoid
10.18any potential conflict of interest.
10.19 Subd. 4.Terms; compensation; removal.The terms of members representing the state
10.20agencies are four years and are coterminous with the governor. The terms of other
10.21nonlegislative members of the council shall be as provided in section 15.059, subdivision
10.222. Members may serve until their successors are appointed and qualify. Compensation and
10.23removal of nonlegislative council members is as provided in section 15.059, subdivisions
10.243 and 4. Compensation of legislative members is as determined by the appointing authority.
10.25The agency may reimburse legislative members for expenses. A vacancy on the council
10.26may be filled by the appointing authority provided in subdivision 2 for the remainder of the
10.27unexpired term.
10.28 Subd. 5.Strategic plan.The council shall adopt a strategic plan for recommending
10.29policy changes and making expenditures from the rental opportunity fund that further the
10.30purpose in section 462A.53, subdivision 2, including identifying the priority areas for funding
10.31for the next six years. The council shall issue a revised plan by December 1 each
10.32even-numbered year. The strategic plan must have clearly stated short- and long-term goals
10.33and strategies for fund expenditures, must provide measurable outcomes for expenditures,
10Article 2 Sec. 6.
REVISOR MS/LJ 25-0307902/18/25 11.1and must determine areas of emphasis for funding. The council's strategic plan must detail
11.2how the council will engage impacted individuals and communities and ensure council
11.3recommendations support the fund's purpose and the intention to reduce disparities, support
11.4community-based solutions, improve the condition of homes, increase accessibility, and
11.5improve energy and water efficiency.
11.6 Subd. 6.Recommended appropriations.The Rental Opportunity Council shall
11.7recommend to the governor and the legislature the manner in which money from the rental
11.8opportunity fund should be appropriated for the purposes stated in section 462A.53 and the
11.9Minnesota Constitution, article XI, section 16.
11.10 Subd. 7.Reports to legislature.(a) By January 15 of each odd-numbered year, the
11.11council must submit a report to the chairs and ranking minority members of the legislative
11.12committees with jurisdiction over housing and jurisdiction over taxes on the activities for
11.13which money has been or will be spent for the current biennium and the activities for which
11.14money is recommended to be spent in the next biennium.
11.15 (b) By January 15 of each even-numbered year, the council may submit to the legislature
11.16supplemental recommendations on the manner in which money from the rental opportunity
11.17fund should be appropriated in the next fiscal year.
11.18Sec. 7. EFFECTIVE DATE.
11.19 This article is effective July 1, 2027, if the constitutional amendment proposed in article
11.201, section 1, is adopted by the voters.
11Article 2 Sec. 7.
REVISOR MS/LJ 25-0307902/18/25 Page.Ln 1.9
CONSTITUTIONAL AMENDMENT TO FUND HOUSING
INITIATIVES.........................................................................................ARTICLE 1
Page.Ln 2.19STATUTORY CHANGES......................................................................ARTICLE 2
1
APPENDIX
Article locations for 25-03079