Wisconsin Legislative Council
ACT MEMO
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Prepared by: Ethan Lauer, Senior Staff Attorney August 9, 2023
2023 Wisconsin Act 15
[2023 Assembly Bill 265]
Main Street Housing
Rehabilitation Loan Fund
2023 Wisconsin Act 15 creates a main street housing rehabilitation revolving loan fund and loan fund
program.
REVOLVING LOAN FUND
The act creates a main street housing rehabilitation revolving loan fund under the jurisdiction and
control of the Wisconsin Housing and Economic Development Authority (WHEDA). The fund consists
of amounts appropriated to it and amounts received from the repayment of loans. Of the appropriations
to the fund in the 2023-25 fiscal biennium,
1
WHEDA must return to the Department of Administration
for deposit in the general fund any such amounts not encumbered or expended for an eligible project as
of January 1, 2031.
LOANS TO OWNERS OF RENTAL HOUSING
Under the program, an owner of single-family or multi-family rental housing may apply to WHEDA for
a loan to cover the costs of housing rehabilitation of existing workforce housing
2
that meets the
following requirements:
Is located on the second or third floor of an existing two−story or three−story building with a
commercial use on the main floor.
3
Is located in a building that was constructed at least 40 years prior to the date of the loan
application.
Has not been significantly improved for at least 20 years prior to the date of the loan application, as
determined by WHEDA.
Is vacant or has been underutilized, as determined by WHEDA.
4
1
2023 Wisconsin Act 19, the 2023-25 biennial budget act, appropriated $100 million to the fund in fiscal year 2023-24.
2
“Workforce housing” is housing that costs a household no more than 30 percent of 100 percent of area median income
and is for occupancy by individuals whose household median income does not exceed 100 percent of area median
income.
3
The space in the building that is devoted to a commercial use must constitute no more than two-thirds of the building’s
gross square footage.
4
In addition, the housing must be subject to property taxation, not have been the subject of a claim for a historic
rehabilitation tax credit, and not have received financial assistance from tax increments generated by an active tax
incremental district. - 2 -
For purposes of the loan fund program, “housing rehabilitation” means an improvement to rental
housing to maintain the housing in a decent, safe, and sanitary condition or to restore it to that
condition, and includes any of the following:
Repairing or replacing a heating system, electrical system, internal plumbing system, interior wall
or ceiling, roof, window, exterior door, or flooring.
Repairing or replacing insulation or siding.
Remediating lead paint, asbestos, or mold.
The housing must remain workforce housing for 10 years following initial occupancy. That restriction
must be recorded against the residential property with the register of deeds and must run with the land.
The owner must submit to WHEDA a certified rent roll showing relevant costs and rent paid during that
10-year period. WHEDA must keep confidential all information an owner submits in connection with a
certified rent roll.
A loan may not be awarded unless the owner and the political subdivision
5
having jurisdiction over the
rehabilitation project demonstrate the following to the satisfaction of WHEDA:
The owner has secured the necessary financial resources for the total cost of the housing
rehabilitation project not to be covered by a loan under the program.
The owner has secured all applicable permits or other approvals.
The political subdivision has reduced the cost of rental housing in connection with the rehabilitation
project by voluntarily revising zoning ordinances, subdivision regulations, or other land
development regulations to increase development density, expedite approvals, reduce impact fees,
or reduce parking, building, or other development costs with respect to the project.
6
The political subdivision is in compliance with applicable requirements relating to comprehensive
planning, the housing affordability report, and the new housing fee report.
The political subdivision has updated the housing element of its comprehensive plan within the five
years immediately preceding the date of the loan application.
A loan may not exceed the lesser of $20,000 per dwelling unit or 25 percent of the total cost of the
rehabilitation project.
ADMINISTRATION OF LOANS AND THE LOAN FUND
WHEDA must establish policies and procedures to administer the loan fund and the loan program. The
policies and procedures must, to the extent practicable, address credit underwriting guidelines, loan
security, and loan repayment requirements. In addition, WHEDA and the owner must enter into an
agreement establishing terms and conditions of the loan, among other matters.
5
“Political subdivision” means a city, village, town, or county.
6
The political subdivision must submit a cost reduction analysis that shows the cost reduction measures, including
time-saving measures, undertaken by the political subdivision on or after January 1, 2023, that have reduced the cost
of rental housing in connection with the project. The analysis shall clearly show for each time-saving or cost-reduction
measure the estimated time or dollar amount saved by the owner and the estimated percentage reduction in rental
housing costs. - 3 -
The act requires that WHEDA set aside 30 percent of the amounts deposited in the fund in the 2023-25
fiscal biennium for a period of at least four years for projects in cities, villages, and towns with a
population of 10,000 or less.
WHEDA may charge interest at or below market rates on any loan made from the loan fund or may
charge no interest.
Finally, WHEDA must establish a marketing program to advertise the loan program and must submit
annual reports to the Legislature.
Effective date: June 24, 2023
For a full history of the bill, visit the Legislature’s bill history page.
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