| 1 | 1 | | 1.1 A bill for an act |
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| 2 | 2 | | 1.2 relating to economic development; modifying the annual volume cap allocations |
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| 3 | 3 | | 1.3 and allocation procedure for public facility projects funded by public facility bonds; |
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| 4 | 4 | | 1.4 amending Minnesota Statutes 2024, sections 474A.03, subdivision 1; 474A.091, |
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| 5 | 5 | | 1.5 subdivisions 2a, 3. |
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| 6 | 6 | | 1.6BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: |
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| 7 | 7 | | 1.7 Section 1. Minnesota Statutes 2024, section 474A.03, subdivision 1, is amended to read: |
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| 8 | 8 | | 1.8 Subdivision 1.Under federal tax law; allocations.At the beginning of each calendar |
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| 9 | 9 | | 1.9year after December 31, 2001, the commissioner shall determine the aggregate dollar amount |
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| 10 | 10 | | 1.10of the annual volume cap under federal tax law for the calendar year, and of this amount |
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| 11 | 11 | | 1.11the commissioner shall make the following allocation: |
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| 12 | 12 | | 1.12 (1) $74,530,000 $25,500,000 to the small issue pool; |
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| 13 | 13 | | 1.13 (2) $122,060,000 to the housing pool, of which 27 percent of the adjusted allocation is |
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| 14 | 14 | | 1.14reserved until the last Monday in June each year until 2021 for single-family housing |
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| 15 | 15 | | 1.15programs, after which 31 percent of the adjusted allocation is reserved until the last Monday |
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| 16 | 16 | | 1.16in June for single-family programs; |
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| 17 | 17 | | 1.17 (3) $12,750,000 $61,780,000 to the public facilities pool; and |
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| 18 | 18 | | 1.18 (4) amounts to be allocated as provided in subdivision 2a. |
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| 19 | 19 | | 1.19 If the annual volume cap is greater or less than the amount of bonding authority allocated |
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| 20 | 20 | | 1.20under clauses (1) to (4) and subdivision 2a, paragraph (a), clauses (1) to (4), the allocation |
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| 21 | 21 | | 1.21must be adjusted so that each adjusted allocation is the same percentage of the annual volume |
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| 22 | 22 | | 1.22cap as each original allocation is of the total bonding authority originally allocated. |
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| 23 | 23 | | 1Section 1. |
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| 24 | 24 | | 25-02695 as introduced01/22/25 REVISOR JSK/AC |
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| 25 | 25 | | SENATE |
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| 26 | 26 | | STATE OF MINNESOTA |
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| 27 | 27 | | S.F. No. 2862NINETY-FOURTH SESSION |
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| 28 | 28 | | (SENATE AUTHORS: PUTNAM) |
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| 29 | 29 | | OFFICIAL STATUSD-PGDATE |
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| 30 | 30 | | Introduction and first reading03/20/2025 |
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| 31 | 31 | | Referred to Jobs and Economic Development 2.1 Sec. 2. Minnesota Statutes 2024, section 474A.091, subdivision 2a, is amended to read: |
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| 32 | 32 | | 2.2 Subd. 2a.Application for all other types of qualified bonds.(a) Issuers may apply |
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| 33 | 33 | | 2.3for an allocation for all types of qualified bonds other than residential rental bonds under |
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| 34 | 34 | | 2.4this section by submitting to the department an application on forms provided by the |
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| 35 | 35 | | 2.5department accompanied by: |
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| 36 | 36 | | 2.6 (1) a preliminary resolution; |
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| 37 | 37 | | 2.7 (2) a statement of bond counsel that the proposed issue of obligations requires an |
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| 38 | 38 | | 2.8allocation under this chapter and the Internal Revenue Code; |
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| 39 | 39 | | 2.9 (3) the type of qualified bonds to be issued; |
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| 40 | 40 | | 2.10 (4) an application deposit in the amount of two percent of the requested allocation; and |
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| 41 | 41 | | 2.11 (5) a public purpose scoring worksheet for manufacturing and enterprise zone |
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| 42 | 42 | | 2.12applications. |
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| 43 | 43 | | 2.13The issuer must pay the application deposit to the Department of Management and Budget. |
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| 44 | 44 | | 2.14An entitlement issuer may not apply for an allocation for public facility bonds or mortgage |
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| 45 | 45 | | 2.15bonds under this section unless it has either permanently issued bonds equal to the amount |
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| 46 | 46 | | 2.16of its entitlement allocation for the current year plus any amount carried forward from |
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| 47 | 47 | | 2.17previous years or returned for reallocation all of its unused entitlement allocation. For |
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| 48 | 48 | | 2.18purposes of this subdivision, an entitlement allocation includes an amount obtained under |
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| 49 | 49 | | 2.19section 474A.04, subdivision 6. |
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| 50 | 50 | | 2.20 (b) An issuer that receives an allocation under this subdivision must permanently issue |
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| 51 | 51 | | 2.21obligations equal to all or a portion of the allocation received on or before 120 180 days of |
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| 52 | 52 | | 2.22the allocation. If an issuer that receives an allocation under this subdivision does not |
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| 53 | 53 | | 2.23permanently issue obligations equal to all or a portion of the allocation received within the |
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| 54 | 54 | | 2.24time period provided in this paragraph or returns the allocation to the commissioner, the |
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| 55 | 55 | | 2.25amount of the allocation is canceled and returned for reallocation through the unified pool. |
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| 56 | 56 | | 2.26 (c) Notwithstanding the restrictions imposed on entitlement issuers under this subdivision, |
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| 57 | 57 | | 2.27the Minnesota Housing Finance Agency may not receive an allocation for mortgage bonds |
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| 58 | 58 | | 2.28under this section prior to the first Monday in October, but may be awarded allocations for |
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| 59 | 59 | | 2.29mortgage bonds from the unified pool on or after the first Monday in October. The Minnesota |
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| 60 | 60 | | 2.30Housing Finance Agency, the Minnesota Office of Higher Education, and the Minnesota |
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| 61 | 61 | | 2.31Rural Finance Authority may apply for and receive an allocation under this section without |
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| 62 | 62 | | 2.32submitting an application deposit. |
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| 63 | 63 | | 2Sec. 2. |
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| 64 | 64 | | 25-02695 as introduced01/22/25 REVISOR JSK/AC 3.1 Sec. 3. Minnesota Statutes 2024, section 474A.091, subdivision 3, is amended to read: |
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| 65 | 65 | | 3.2 Subd. 3.Allocation procedure.(a) The commissioner shall allocate available bonding |
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| 66 | 66 | | 3.3authority under this section on the Monday of every other week beginning with the first |
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| 67 | 67 | | 3.4Monday in July through and on the last Monday in November. Applications for allocations |
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| 68 | 68 | | 3.5must be received by the department by 4:30 p.m. on the Monday preceding the Monday on |
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| 69 | 69 | | 3.6which allocations are to be made. If a Monday falls on a holiday, the allocation will be made |
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| 70 | 70 | | 3.7or the applications must be received by the next business day after the holiday. |
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| 71 | 71 | | 3.8 (b) Prior to October 1, only the following applications shall be awarded allocations from |
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| 72 | 72 | | 3.9the unified pool. Allocations shall be awarded in the following order of priority: |
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| 73 | 73 | | 3.10 (1) applications for residential rental project bonds; |
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| 74 | 74 | | 3.11 (2) applications for public facility projects funded by public facility bonds; |
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| 75 | 75 | | 3.12 (3) applications for small issue bonds for manufacturing projects; and |
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| 76 | 76 | | 3.13 (3) (4) applications for small issue bonds for agricultural development bond loan projects. |
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| 77 | 77 | | 3.14 (c) On the first Monday in October through the last Monday in November, allocations |
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| 78 | 78 | | 3.15shall be awarded from the unified pool in the following order of priority: |
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| 79 | 79 | | 3.16 (1) applications for student loan bonds issued by or on behalf of the Minnesota Office |
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| 80 | 80 | | 3.17of Higher Education; |
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| 81 | 81 | | 3.18 (2) applications for mortgage bonds; |
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| 82 | 82 | | 3.19 (3) applications for public facility projects funded by public facility bonds; |
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| 83 | 83 | | 3.20 (4) (3) applications for small issue bonds for manufacturing projects; |
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| 84 | 84 | | 3.21 (5) (4) applications for small issue bonds for agricultural development bond loan projects; |
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| 85 | 85 | | 3.22 (6) (5) applications for residential rental project bonds; |
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| 86 | 86 | | 3.23 (7) (6) applications for enterprise zone facility bonds; |
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| 87 | 87 | | 3.24 (8) (7) applications for governmental bonds; and |
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| 88 | 88 | | 3.25 (9) (8) applications for redevelopment bonds. |
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| 89 | 89 | | 3.26 (d) If there are two or more applications for manufacturing projects from the unified |
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| 90 | 90 | | 3.27pool and there is insufficient bonding authority to provide allocations for all manufacturing |
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| 91 | 91 | | 3.28projects in any one allocation period, the available bonding authority shall be awarded based |
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| 92 | 92 | | 3.29on the number of points awarded a project under section 474A.045 with those projects |
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| 93 | 93 | | 3.30receiving the greatest number of points receiving allocation first. If two or more applications |
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| 94 | 94 | | 3Sec. 3. |
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| 95 | 95 | | 25-02695 as introduced01/22/25 REVISOR JSK/AC 4.1for manufacturing projects receive an equal amount of points, available bonding authority |
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| 96 | 96 | | 4.2shall be awarded by lot unless otherwise agreed to by the respective issuers. |
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| 97 | 97 | | 4.3 (e) If there are two or more applications for enterprise zone facility projects from the |
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| 98 | 98 | | 4.4unified pool and there is insufficient bonding authority to provide allocations for all enterprise |
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| 99 | 99 | | 4.5zone facility projects in any one allocation period, the available bonding authority shall be |
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| 100 | 100 | | 4.6awarded based on the number of points awarded a project under section 474A.045 with |
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| 101 | 101 | | 4.7those projects receiving the greatest number of points receiving allocation first. If two or |
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| 102 | 102 | | 4.8more applications for enterprise zone facility projects receive an equal amount of points, |
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| 103 | 103 | | 4.9available bonding authority shall be awarded by lot unless otherwise agreed to by the |
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| 104 | 104 | | 4.10respective issuers. |
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| 105 | 105 | | 4.11 (f) If there are two or more applications for residential rental projects from the unified |
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| 106 | 106 | | 4.12pool and there is insufficient bonding authority to provide allocations for all residential |
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| 107 | 107 | | 4.13rental projects in any one allocation period, the available bonding authority shall be awarded |
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| 108 | 108 | | 4.14in the following order of priority: (1) preservation projects; (2) 30 percent AMI residential |
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| 109 | 109 | | 4.15rental projects; (3) 50 percent AMI residential rental projects for which the amount of bonds |
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| 110 | 110 | | 4.16requested in their respective applications do not exceed the aggregate bond limitations; (4) |
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| 111 | 111 | | 4.17100 percent LIHTC projects; (5) 20 percent LIHTC projects; and (6) other residential rental |
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| 112 | 112 | | 4.18projects. If there are two or more applications for residential rental projects at the same |
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| 113 | 113 | | 4.19priority level and there is insufficient bonding authority to provide allocations for all the |
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| 114 | 114 | | 4.20projects in any one allocation period, available bonding authority shall be randomly awarded |
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| 115 | 115 | | 4.21by lot but only for projects that can receive the full amount of their respective requested |
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| 116 | 116 | | 4.22allocations. If a residential rental project does not receive any of its requested allocation |
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| 117 | 117 | | 4.23pursuant to this paragraph and the project applies in the next successive housing pool or the |
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| 118 | 118 | | 4.24next successive unified pool for an allocation of bonds, the project shall be fully funded up |
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| 119 | 119 | | 4.25to its original application request for bonding authority before any new project, applying |
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| 120 | 120 | | 4.26in the same allocation period, that has an equal priority shall receive bonding authority. |
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| 121 | 121 | | 4.27 (g) From the first Monday in July through the last Monday in November, $20,000,000 |
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| 122 | 122 | | 4.28of bonding authority or an amount equal to the total annual amount of bonding authority |
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| 123 | 123 | | 4.29allocated to the small issue pool under section 474A.03, subdivision 1, less the amount |
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| 124 | 124 | | 4.30allocated to issuers from the small issue pool for that year, whichever is less, is reserved |
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| 125 | 125 | | 4.31within the unified pool for small issue bonds to the extent the amounts are available within |
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| 126 | 126 | | 4.32the unified pool. |
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| 127 | 127 | | 4.33 (h) From the first Monday in July through the last Monday in November, $50,000,000 |
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| 128 | 128 | | 4.34of bonding authority or an amount equal to the total annual amount of bonding authority |
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| 129 | 129 | | 4.35allocated to the public facilities pool under section 474A.03, subdivision 1, less the amount |
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| 130 | 130 | | 4Sec. 3. |
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| 131 | 131 | | 25-02695 as introduced01/22/25 REVISOR JSK/AC 5.1allocated to issuers from the public facilities pool for that year, whichever is less, is reserved |
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| 132 | 132 | | 5.2within the unified pool for public facilities bonds to the extent the amounts are available |
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| 133 | 133 | | 5.3within the unified pool. |
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| 134 | 134 | | 5.4 (h) (i) The total amount of allocations for mortgage bonds from the housing pool and |
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| 135 | 135 | | 5.5the unified pool may not exceed: |
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| 136 | 136 | | 5.6 (1) $10,000,000 for any one city; or |
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| 137 | 137 | | 5.7 (2) $20,000,000 for any number of cities in any one county. |
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| 138 | 138 | | 5.8 (i) (j) The total amount of allocations for student loan bonds from the unified pool may |
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| 139 | 139 | | 5.9not exceed $25,000,000 per year. |
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| 140 | 140 | | 5.10 (j) (k) If there is insufficient bonding authority to fund all projects within any qualified |
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| 141 | 141 | | 5.11bond category other than enterprise zone facility projects, manufacturing projects, and |
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| 142 | 142 | | 5.12residential rental projects, allocations shall be awarded by lot unless otherwise agreed to |
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| 143 | 143 | | 5.13by the respective issuers. |
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| 144 | 144 | | 5.14 (k) (l) If an application is rejected, the commissioner must notify the applicant and return |
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| 145 | 145 | | 5.15the application deposit to the applicant within 30 days unless the applicant requests in writing |
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| 146 | 146 | | 5.16that the application be resubmitted. |
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| 147 | 147 | | 5.17 (l) (m) The granting of an allocation of bonding authority under this section must be |
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| 148 | 148 | | 5.18evidenced by issuance of a certificate of allocation. |
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| 149 | 149 | | 5Sec. 3. |
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| 150 | 150 | | 25-02695 as introduced01/22/25 REVISOR JSK/AC |
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