HF 4228

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to public finance; allocating additional tax-exempt bonding authority;
clarifying application of certain rent restrictions; amending Minnesota Statutes
2006, section 474A.047, subdivision 1.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2006, section 474A.047, subdivision 1, is amended to
read:

Subdivision 1.

Eligibility.

(a) An issuer may only use the proceeds from residential
rental bonds if the proposed project meets the following requirements:

(1) the proposed residential rental project meets the requirements of section 142(d)
of the Internal Revenue Code regarding the incomes of the occupants of the housing; and

(2) the maximum rent for at least 20 percent of the units in the proposed residential
rental project do not exceed the area fair market rent or exception fair market rents for
existing housing, if applicable, as established by the federal Department of Housing and
Urban Development. new text begin The rental rates of units in a residential rental project for which
project-based federal assistance payments are made are deemed to be within the rent
limitations of this clause.
new text end

(b) The proceeds from residential rental bonds may be used for a project for which
project-based federal rental assistance payments are made only if:

(1) the owner of the project enters into a binding agreement with the Minnesota
Housing Finance Agency under which the owner is obligated to extend any existing
low-income affordability restrictions and any contract or agreement for rental assistance
payments for the maximum term permitted, including any renewals thereof; and

(2) the Minnesota Housing Finance Agency certifies that project reserves will be
maintained at closing of the bond issue and budgeted in future years at the lesser of:

(i) the level described in Minnesota Rules, part 4900.0010, subpart 7, item A,
subitem (2), effective May 1, 1997; or

(ii) the level of project reserves available prior to the bond issue, provided that
additional money is available to accomplish repairs and replacements needed at the time
of bond issue.

Sec. 2. new text begin TEMPORARY INCREASE IN ANNUAL VOLUME CAP.
new text end

new text begin Subdivision 1. new text end

new text begin Applicability. new text end

new text begin This section applies if federal tax law is amended
after April 28, 2008, to provide a temporary increase in the annual volume cap for private
activity bonds for housing purposes for calendar year 2008 or 2009, and applies only to the
amount of the annual volume cap attributable to the temporary increase for those purposes.
new text end

new text begin Subd. 2. new text end

new text begin Definitions. new text end

new text begin As used in this section, "annual volume cap," "bonding
authority," "commissioner," "federal tax law," and "housing pool" have the meanings given
in Minnesota Statutes, section 474A.02. As used in this section, "agency" and "city" have
the meanings given in Minnesota Statutes, section 474A.061, subdivision 2a, paragraph
(c). As used in this section, "carryforward" means the ability to issue obligations in a year
subsequent to the year in which an allocation of bonding authority was obtained under this
section as provided in section 146(f) of federal tax law.
new text end

new text begin Subd. 3. new text end

new text begin Allocations. new text end

new text begin (a) The commissioner shall determine the aggregate dollar
amount attributable to the temporary increase in the annual volume cap for housing
purposes. Of this amount, the commissioner shall make the following allocations for 2008:
new text end

new text begin (1) 43 percent to the housing pool, of which 31 percent of the allocation is reserved
for single-family housing programs for a period ending on the earlier of:
new text end

new text begin (i) October 31, 2008, or October 31, 2009, if the increase is made available for
calendar year 2009; or
new text end

new text begin (ii) 180 days after the allocation by the commissioner of the temporary increase
in the volume cap;
new text end

new text begin (2) 30 percent to the agency;
new text end

new text begin (3) 12 percent to the city of Minneapolis;
new text end

new text begin (4) nine percent to the city of St. Paul; and
new text end

new text begin (5) six percent to the Dakota County Community Development Agency for the
county of Dakota and all political subdivisions located within the county.
new text end

new text begin (b) Allocations provided under this subdivision must be used for mortgage bonds or
residential rental project bonds.
new text end

new text begin (c) Data on the home purchase price amount, mortgage amount, income, household
size, and race of the households served with the proceeds of mortgage bonds and
mortgage credit certificates using an allocation under this section in a calendar year
must be submitted by each issuer to the agency by December 31 of the following year.
Compliance by the agency with the provisions of Minnesota Statutes, section 462A.073,
subdivision 5, shall be deemed to be in compliance by the agency with the reporting
requirements of this paragraph.
new text end

new text begin (d) Any amount allocated under paragraph (a), clause (2), (3), (4), or (5), may be
transferred as provided in Minnesota Statutes, section 474A.04, subdivision 6.
new text end

new text begin Subd. 4. new text end

new text begin Housing pool. new text end

new text begin Any amounts allocated to the housing pool under
subdivision 3 that are not reserved for single-family housing programs must be allocated
according to Minnesota Statutes, section 474A.061, subdivisions 2a and 4, subject to
the following conditions:
new text end

new text begin (1) other amounts in the housing pool, if any, must be allocated from the housing
pool before any allocation is made from amounts attributable to the temporary increase in
annual volume cap;
new text end

new text begin (2) any amount of the temporary increase in the annual volume cap remaining in
the housing pool on the last Monday of July 2008, or on the last Monday of July 2009, if
the temporary increase in annual volume cap is made available for calendar year 2009, or
that is allocated to the housing pool under subdivision 3, thereafter shall remain in the
housing pool for allocation until the last Monday in November 2008, or the last Monday
in November 2009, if the temporary increase in the annual volume is made available
for calendar year 2009;
new text end

new text begin (3) any allocation of the temporary increase in the annual volume cap that is
canceled under Minnesota Statutes, section 474A.061, subdivision 4, shall be returned to
the housing pool for reallocation, unless the cancellation occurs after the last Monday in
November 2008, or after the last Monday in November 2009, if the temporary increase in
the annual volume is made available for calendar year 2009, in which case the canceled
allocation is allocated to the agency; and
new text end

new text begin (4) any bonding authority attributable to the temporary increase in the annual
volume cap that has not been allocated on December 1, 2008, or on December 1, 2009, if
the temporary increase in the annual volume is made available for calendar year 2009, is
allocated to the agency.
new text end

new text begin Subd. 5. new text end

new text begin Single-family housing programs. new text end

new text begin (a) Bonding authority reserved in the
housing pool for single-family housing programs under subdivision 3 is available for
single-family housing programs for cities that applied in January 2008, and received an
allocation under Minnesota Statutes, section 474A.061, subdivision 2a, in 2008. If the
temporary increase in the annual volume is made available for calendar year 2009, the
bonding authority reserved in the housing pool for single-family housing programs under
subdivision 3 is available for single-family housing programs for cities that applied in
January 2009, and received an allocation under Minnesota Statutes, section 474A.061,
subdivision 2a, in 2009. The agency shall receive an allocation for mortgage bonds
pursuant to this subdivision. For a period of time determined by the agency, the agency
may accept applications from the cities for the volume cap.
new text end

new text begin (b) The agency may issue bonds on behalf of participating cities. The agency shall
request an allocation from the commissioner for all applicants and the commissioner
shall allocate the requested amount to the agency. Allocations shall be awarded by the
commissioner through the last Monday in November 2008 for applications received by
4:30 p.m. on the Monday of the week preceding an allocation. If the temporary increase in
the annual volume is made available for calendar year 2009, the commissioner shall award
allocations through the last Monday in November 2009 for applications received by 4:30
p.m. on the Monday of the week preceding an allocation.
new text end

new text begin Allocations must be made for each loan on a first-come, first-served basis among
the cities. The agency shall submit an application fee under Minnesota Statutes, section
474A.03, subdivision 4, and an application deposit equal to two percent of the requested
allocation to the commissioner when requesting an allocation from the housing pool
under this subdivision. After awarding an allocation and receiving a notice of issuance
for mortgage bonds issued on behalf of the participating cities, the commissioner shall
transfer the application deposit to the agency.
new text end

new text begin (c) Total allocations from the housing pool for single-family housing programs
under this subdivision may not exceed 31 percent of the allocation to the housing pool
under subdivision 3 until November 1, 2008. If the temporary increase in the annual
volume is made available for calendar year 2009, the total allocations from the housing
pool for single-family housing programs under this subdivision may not exceed 31 percent
of the allocation to the housing pool under subdivision 3 until November 1, 2009.
new text end

new text begin (d) An allocation awarded to the agency for mortgage bonds under this subdivision
may be carried forward by the agency as provided in subdivision 6.
new text end

new text begin Subd. 6. new text end

new text begin Carryforward. new text end

new text begin Any issuer that receives an allocation under this section
may carry forward the allocation to the extent permitted by federal tax law. The provisions
of Minnesota Statutes, section 474A.04, subdivision 1a, do not apply to the carryforward.
new text end

Sec. 3. new text begin EFFECTIVE DATE.
new text end

new text begin Sections 1 and 2 are effective the day following final enactment.
new text end