Date of enactment:
2023 Assembly Bill 264 Date of publication*:
2023 WISCONSIN ACT
AN ACT to create 234.66 of the statutes; relating to: residential housing infrastructure revolving loan fund and
revolving loan program.
The people of the state of Wisconsin, represented in
senate and assembly, do enact as follows:
SECTION 1. 234.66 of the statutes is created to read:
234.66 Residential housing infrastructure revolv-
ing loan fund and program. (1) DEFINITIONS. In this
section:
(a) “Area median income” means the area median
family income in the county in which the housing is
located, adjusted for family size, as published annually
by the federal department of housing and urban develop-
ment.
(b) “Developer” means a person other than a govern-
mental unit that constructs or creates residential housing.
(c) “Eligible governmental unit” means the govern-
mental unit having jurisdiction of an eligible project, as
determined by the authority.
(d) “Eligible project” means a project for housing
infrastructure for workforce housing or senior housing.
(dd) “Governmental unit” means a city, village,
town, or county or federally recognized American Indian
tribe or band in this state.
(e) “Housing infrastructure” means that portion of
the installation, replacement, upgrade, or improvement
of public infrastructure, or private infrastructure in rural
areas if transferred to public use, as determined by the
authority, that relates to an eligible project.
(f) “Public infrastructure” means any of the follow-
ing that is or will be owned, maintained, or provided to
or by a governmental unit:
1. A water distribution system.
2. A water treatment plant.
3. A wastewater treatment plant.
4. A sanitary sewer system.
5. A storm sewer system.
6. A stormwater retention pond.
7. A lift or pump station.
8. A street, road, alley, or bridge.
9. A curb, gutter, or sidewalk.
10. A traffic device.
11. A street light.
12. An electric or gas distribution line.
(g) “Residential housing” means new single−family
or multifamily housing for rent or sale that satisfies all of
the following:
1. Is subject to taxation under ch. 70.
2. Has not been the subject of a claim for a state or
federal historic rehabilitation tax credit, as determined by
the authority.
3. Has not received financial assistance from tax
increments generated by an active tax incremental dis-
trict.
* Section 991.11, WISCONSIN STATUTES: Effective date of acts. “Every act and every portion of an act enacted by the legislature over the governor’s
partial veto which does not expressly prescribe the time when it takes effect shall take effect on the day after its date of publication.” − 2 −2023 Wisconsin Act 2023 Assembly Bill 264
(h) “Senior housing” means residential housing that
satisfies par. (i) 1. to 4. and that is intended and operated
primarily for occupancy by at least one person 55 years
of age or older per dwelling unit, as determined by the
authority.
(i) “Workforce housing” means residential housing
that satisfies all of the following, as determined by the
authority:
1. For housing intended to be rented, the estimated
annual housing costs, as defined under s. 16.301 (3), do
not exceed, or are not expected to exceed, 30 percent of
100 percent of the area median income, with family size
determined using the federal imputed income limitation,
as defined in 26 USC 42 (g) (2) (C), and the utility−
related costs if not included in the rent equal the utility
allowance determined by the federal department of hous-
ing and urban development.
2. For housing intended to be occupied by the owner,
the estimated annual housing costs, as defined under s.
16.301 (3), do not exceed, or are not expected to exceed,
30 percent of 140 percent of the area median income,
with family size determined using the federal imputed
income limitation, as defined in 26 USC 42 (g) (2) (C).
3. For housing intended to be rented, the housing is
for occupancy by individuals whose annual household
income does not exceed 100 percent of the area median
income.
4. For housing intended to be occupied by the owner,
the housing is for purchase by individuals whose annual
household income is not more than 140 percent of the
area median income.
(2) ESTABLISHMENT OF FUND. (a) There is established
under the jurisdiction and control of the authority a resi-
dential housing infrastructure revolving loan fund, for
the purpose of providing loans under sub. (3). The
authority may use moneys in the fund to cover actual and
necessary expenses incurred to accomplish the purposes
of this section, including marketing expenses under sub.
(6), and administer the fund. The fund shall consist of all
of the following:
1. All moneys appropriated to the authority for the
fund.
2. All moneys received from the repayment of loans
under sub. (3).
(am) In its discretion, the authority may invest fund
moneys that are not required for immediate use or dis-
bursement in all of the following to the extent lawful for
fiduciaries in this state:
1. An obligation of the United States or one of its
agencies or instrumentalities, or an obligation the princi-
pal and interest of which are guaranteed by the United
States or one of its agencies or instrumentalities.
2. An obligation of any state, or of any county, city,
or other political subdivision of a state, having long−term
ratings in the AA category or higher.
3. A certificate of deposit.
4. The state investment fund.
5. A money market mutual fund restricted to one or
more investments as provided in subd. 1., 2., 3., or 4.
(an) All investments under par. (am) shall be the
exclusive property of the fund. All earnings on or income
from such investments shall be credited to the fund.
(b) Of the amounts deposited in the fund under par.
(a) 1. in the 2023−25 fiscal biennium, the authority shall
return to the secretary of administration for deposit in the
general fund all such amounts not encumbered or
expended for an eligible project as of the first day of the
8th year beginning after the effective date of this para-
graph .... [LRB inserts date].
(c) No moneys in the fund may be invested under s.
234.03 (18).
(3) ESTABLISHMENT OF REVOLVING LOAN PROGRAM.
The authority shall establish and administer a residential
housing infrastructure revolving loan program for the
purpose of awarding loans under this section.
(4) LOANS TO RESIDENTIAL HOUSING DEVELOPERS. (a)
From the residential housing infrastructure revolving
loan fund, the authority may award loans to developers
to cover housing infrastructure costs for an eligible proj-
ect. Any developer may apply to the authority for a loan
under this subsection in accordance with the application
process established by the authority under par. (b), but the
authority may not award the loan unless the developer
and the eligible governmental unit demonstrate to the sat-
isfaction of the authority in one or more forms prescribed
by the authority that all of the following apply:
1. The developer has secured the necessary financial
resources for the total cost of development of the residen-
tial housing supported by the eligible project.
2. The developer has secured all applicable federal,
state, and local government permits or other approvals
for the eligible project and the residential housing sup-
ported by the eligible project.
4. Any applicable sewer or water service area plan
has been amended if necessary.
5. The eligible governmental unit has reduced the
cost of residential housing in connection with the eligible
project by voluntarily revising zoning ordinances, subdi-
vision regulations, or other land development regulations
to increase development density, expedite approvals,
reduce impact, water connection, and inspection fees, or
reduce parking, building, or other development costs
with respect to the development of residential housing
supported by the project. For purposes of this subdivi-
sion, the governmental unit in cooperation with the
developer shall submit to the authority a cost reduction
analysis in a form prescribed by the authority and signed
by the developer and the head of the governmental unit’s
governing body that shows the cost reduction measures,
including time saving measures, undertaken by the gov-
ernmental unit on or after January 1, 2023, that have
reduced the cost of residential housing in connection with − 3 − 2023 Wisconsin Act 2023 Assembly Bill 264
the eligible project. The signed analysis shall clearly
show for each time saving or cost reduction measure the
estimated time or dollar amount saved by the developer
and the estimated percentage reduction in housing costs.
6. The eligible governmental unit is in compliance
with the requirements under ss. 66.1001, 66.10013, and
66.10014, to the extent those requirements apply to the
governmental unit.
7. If applicable, the eligible governmental unit has
updated the housing element of its comprehensive plan
under s. 66.1001 (2) (b) within the 5 years immediately
preceding the date of the loan application.
(b) The authority shall establish and provide a semi-
annual application process, including underwriting
guidelines, for the award of loans under this subsection.
If in any application cycle there are insufficient moneys
available in the residential housing infrastructure revolv-
ing loan fund to fund all applications that meet the
requirements under par. (a) and are otherwise acceptable
to the authority, the authority shall prioritize funding
loans for eligible projects in eligible governmental units
that have reduced the cost of residential housing as
described in par. (a) 5. but with respect to the governmen-
tal unit as a whole.
(c) 1. The authority may establish an interest rate for
any loan awarded under this subsection at or below the
market interest rate or may charge no interest.
2. No loan awarded under this subsection may exceed
20 percent of the total cost of development, including
land purchase, of the residential housing supported by the
eligible project.
(d) The authority shall set aside 25 percent of all
moneys deposited in the fund under sub. (2) (a) 1. in the
2023−25 fiscal biennium for a period of not less than 4
years following the effective date of this paragraph ....
[LRB inserts date], for loans awarded under this subsec-
tion and sub. (5) for eligible projects supporting senior
housing. For purposes of this paragraph, if a loan sup-
ports both workforce housing and senior housing, the
amount of such loan supporting senior housing shall be
calculated by prorating the loan amount between the 2
uses based on the number of residential housing units
supported by the loan.
(e) The authority shall set aside 30 percent of all mon-
eys deposited in the fund under sub. (2) (a) 1. in the
2023−25 fiscal biennium, including 30 percent of all
moneys set aside under par. (d), for a period of not less
than 4 years following the effective date of this paragraph
.... [LRB inserts date], for loans awarded under this sub-
section and sub. (5) for eligible projects in cities, villages,
and towns with a population of 10,000 or less. For pur-
poses of this paragraph, if a single loan supports eligible
projects for more than one city, village, or town, the
amount of such loan attributable to any one city, village,
or town shall be calculated by prorating the loan amount
between the cities, villages, and towns based on the num-
ber of residential housing units supported by the loan.
(f) The authority shall divide the state into regions
based on the service jurisdiction as of the effective date
of this paragraph .... [LRB inserts date], of each regional
planning commission constituted under s. 66.0309, with
the counties not served by a regional planning commis-
sion as of that date constituting collectively one region.
Of all moneys deposited in the fund under sub. (2) (a) 1.
in the 2023−25 fiscal biennium, no region may receive
more than 25 percent in loans awarded under this subsec-
tion and sub. (5) in any given application cycle.
(g) 1. The authority and each developer receiving a
loan under this subsection shall enter into an agreement
establishing the term and other conditions of the loan.
The agreement shall include, and give the authority the
power to enforce, all of the following requirements:
a. That the full amount of the loan shall become due
upon the developer’s sale or transfer of all residential
housing constructed in connection with the loan.
b. That all residential housing constructed in connec-
tion with the loan shall remain workforce housing or
senior housing, as applicable, for a period commencing
on the date of the loan and concluding 10 years following
initial occupancy of the residential housing constructed
in connection with the loan. This restriction shall be
recorded against the residential property with the appli-
cable register of deeds and shall run with the land.
c. With respect to each loan under this subsection for
workforce housing or senior housing intended for rent,
that the owner of the rental housing, for a period com-
mencing on the date of the loan and concluding 10 years
following initial occupancy of all of the rental units con-
structed in connection with the loan, shall annually sub-
mit to the authority a certified rent roll for the housing
that sets forth for each rental unit the monthly rent
required under the lease, the actual monthly rent received
for the preceding year, and an identification of the utili-
ties and their amounts included in the rent. This restric-
tion shall be recorded against the residential property
with the applicable register of deeds and shall run with
the land. The authority shall use the information pro-
vided under this subd. 1. c. to confirm that the rental hous-
ing continues to meet the housing costs limitation for pur-
poses of sub. (1) (h) and (i) 1. The authority shall
calculate the applicable monthly limitation on housing
costs for each year by dividing the area median income
for the year by 12, with family size determined using the
federal imputed income limitation, as defined in 26 USC
42 (g) (2) (C). If in any year the area median income has
decreased compared to the prior year, the applicable
housing cost limitation shall be calculated based on the
most recent area median income information prior to
such decrease. The authority shall keep confidential all − 4 −2023 Wisconsin Act 2023 Assembly Bill 264
information an owner of rental housing submits to the
authority under this subd. 1. c.
d. With respect to each loan under this subsection for
workforce housing or senior housing intended to be own-
er−occupied, that for the 10−year period commencing
immediately after the developer closes on the sale of the
housing to the initial owner−occupier, the housing shall
remain owner−occupied and may not be sold for a price
that exceeds the price charged by the developer to the ini-
tial owner−occupier, adjusted annually by the average
compounded annual percentage increase in the sale price
of all residential housing in the county in which the hous-
ing is located, as determined by the authority. These
restrictions shall be recorded against the residential prop-
erty with the applicable register of deeds and shall run
with the land. For the 10−year period, the authority shall
publish on its website the acceptable sales price range for
the residential property.
2. Any restriction recorded against the property
under subd. 1. shall terminate on the date the property is
acquired by foreclosure, or by an instrument in lieu of
foreclosure, unless the authority determines that the
acquisition is part of an arrangement a purpose of which
is to terminate the restriction.
(h) In addition to other criteria explicitly provided for
under this subsection, in awarding each loan under this
subsection, the authority shall take into account only the
following in descending order of priority:
1. Credit risk, collateral, and the need for a loan guar-
antee.
2. The estimated reduction in housing costs.
3. The need for workforce housing or senior housing
in the area.
(5) LOANS TO GOVERNMENTAL UNITS. (a) If the
authority awards a loan to a developer for an eligible proj-
ect under sub. (4), the authority may award a loan from
the residential housing infrastructure revolving loan fund
to the eligible governmental unit having jurisdiction of
the eligible project. The authority and each governmen-
tal unit receiving a loan under this subsection shall enter
into an agreement establishing the term and other condi-
tions of the loan. The eligible governmental unit may use
proceeds of a loan awarded under this subsection to cover
public infrastructure costs incurred by the governmental
unit in connection with the eligible project that are not
directly related to the eligible project itself.
(b) The authority may establish an interest rate for
any loan awarded under this subsection at or below the
market interest rate or may charge no interest.
(c) No loan awarded under this subsection may
exceed 10 percent of the amount of the total cost of devel-
opment of the residential housing supported by the eligi-
ble project.
(5m) POLICIES AND PROCEDURES. The authority shall
establish policies and procedures to administer the resi-
dential housing infrastructure revolving loan fund and
program under this section. The policies and procedures
shall, to the extent practicable, do all of the following:
(a) Incorporate the authority’s policies and proce-
dures for establishing credit underwriting guidelines.
(b) Require that the full amount of each loan awarded
under sub. (4) is secured by one or more unlimited per-
sonal guarantees, unless the developer provides no per-
sonal guarantee on any first mortgage for the eligible
project and the developer’s total debt associated with the
project does not exceed 75 percent of the total collateral
value of the project, as determined by the authority.
(c) Establish loan repayment requirements.
(6) MARKETING. The authority shall establish and
administer a marketing program to advertise the loans
available under this section.
(7) ANNUAL REPORTS. Beginning in 2024, no later
than August 1 of each year, the authority shall submit to
the joint committee on finance and under s. 13.172 (3) to
the standing committees of the legislature having juris-
diction over matters related to housing a report that
includes all of the following:
(a) A statement of the condition and balance of the
residential housing infrastructure revolving loan fund.
(b) Information concerning each loan awarded under
sub. (4) or (5), including all of the following:
1. The date, amount, amortization period, and current
status of the loan.
2. An identification of the loan recipient.
3. A description of the eligible project funded with
the loan, including whether the project is for workforce
housing or senior housing.
4. An identification of the eligible governmental unit
with respect to which the loan was awarded.
(c) The number of dwelling units created to date as
a result of the loan program, the locations and sale or
rental prices of the dwelling units, and whether the
dwelling units constitute workforce housing or senior
housing.