1.1                          A bill for an act
  1.2             relating to housing; establishing an affordable home 
  1.3             ownership funding program; appropriating money; 
  1.4             amending Minnesota Statutes 1994, sections 462A.201, 
  1.5             subdivision 2; 462A.202, subdivisions 2 and 6; 
  1.6             462A.204, subdivision 1; 462A.205, subdivision 4; 
  1.7             462A.206, subdivisions 2 and 5; 462A.21, subdivisions 
  1.8             3b, 8b, 21, and by adding subdivisions; 469.0171; 
  1.9             504.33, subdivisions 2 and 3; 504.34, subdivisions 1 
  1.10            and 2; and 504.35; proposing coding for new law in 
  1.11            Minnesota Statutes, chapter 462A; repealing Minnesota 
  1.12            Statutes 1994, section 462A.21, subdivision 8c. 
  1.13  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.14                             ARTICLE 1
  1.15                          HOUSING PROGRAMS
  1.16     Section 1.  Minnesota Statutes 1994, section 462A.201, 
  1.17  subdivision 2, is amended to read: 
  1.18     Subd. 2.  [LOW-INCOME HOUSING.] (a) The agency may, in 
  1.19  consultation with the advisory committee, use money from the 
  1.20  housing trust fund account to provide loans or grants for 
  1.21  projects for the development, construction, acquisition, 
  1.22  preservation, and rehabilitation of low-income rental and 
  1.23  limited equity cooperative housing units and homes for 
  1.24  ownership.  No more than 20 percent of available funds may be 
  1.25  used for home ownership projects.  
  1.26     (b) The A rental or limited equity cooperative housing 
  1.27  project must meet one of the following income tests: 
  1.28     (1) at least 75 percent of the rental and cooperative 
  1.29  units, and 100 percent of the homes for ownership, must be 
  2.1   rented to or cooperatively owned, or owned by persons and 
  2.2   families whose income does not exceed 30 percent of the median 
  2.3   family income for the metropolitan area as defined in section 
  2.4   473.121, subdivision 2; or 
  2.5      (2) all of the units funded by the housing trust fund 
  2.6   account must be used for the benefit of persons and families 
  2.7   whose income does not exceed 30 percent of the median family 
  2.8   income for the metropolitan area as defined in section 473.121, 
  2.9   subdivision 2. 
  2.10     The median family income may be adjusted for families of 
  2.11  five or more. 
  2.12     (c) Homes for ownership must be owned or purchased by 
  2.13  persons and families whose income does not exceed 50 percent of 
  2.14  the metropolitan area median income, adjusted for family size. 
  2.15     (d) In making the grants, the agency shall determine the 
  2.16  terms and conditions of repayment and the appropriate security, 
  2.17  if any, should repayment be required.  To promote the geographic 
  2.18  distribution of grants and loans, the agency may designate a 
  2.19  portion of the grant or loan awards to be set aside for projects 
  2.20  located in specified congressional districts or other 
  2.21  geographical regions specified by the agency.  The agency may 
  2.22  adopt emergency and permanent rules for awarding grants and 
  2.23  loans under this subdivision.  The emergency rules are effective 
  2.24  for 180 days or until the permanent rules are adopted, whichever 
  2.25  occurs first. 
  2.26     Sec. 2.  Minnesota Statutes 1994, section 462A.204, 
  2.27  subdivision 1, is amended to read: 
  2.28     Subdivision 1.  [ESTABLISHMENT.] The agency may establish a 
  2.29  family homeless prevention and assistance program to assist 
  2.30  families who are homeless or are at imminent risk of 
  2.31  homelessness.  The term "family" may include single 
  2.32  individuals.  The agency may make grants to develop and 
  2.33  implement family homeless prevention and assistance projects 
  2.34  under the program.  For purposes of this section, "families" 
  2.35  means families and persons under the age of 18 22.  
  2.36     Sec. 3.  Minnesota Statutes 1994, section 462A.206, 
  3.1   subdivision 2, is amended to read: 
  3.2      Subd. 2.  [AUTHORIZATION.] The agency may make grants or 
  3.3   loans to cities for the purposes of construction, acquisition, 
  3.4   rehabilitation, demolition, permanent financing, refinancing, or 
  3.5   gap financing of single or multifamily housing, or full cycle 
  3.6   home ownership services, as defined in section 462A.209, 
  3.7   subdivision 2.  Gap financing is financing for the difference 
  3.8   between the cost of the improvement of the blighted property, 
  3.9   including acquisition, demolition, rehabilitation, and 
  3.10  construction, and the market value of the property upon sale.  
  3.11  The agency shall take into account the amount of money that the 
  3.12  city leverages from other sources in awarding grants and loans.  
  3.13  Cities may use the grants and loans to establish revolving loan 
  3.14  funds and to provide grants and loans to eligible mortgagors.  
  3.15  The city may determine the terms and conditions of the grants 
  3.16  and loans.  An agency loan may only be used by a city to make 
  3.17  loans. 
  3.18     Sec. 4.  Minnesota Statutes 1994, section 462A.206, 
  3.19  subdivision 5, is amended to read: 
  3.20     Subd. 5.  [OTHER ELIGIBLE ORGANIZATIONS.] A nonprofit 
  3.21  organization is eligible to apply directly for grants or loans 
  3.22  from the community rehabilitation fund account if the city 
  3.23  within which it is located enacts a resolution authorizing the 
  3.24  organization to apply on the city's behalf, except that a 
  3.25  nonprofit organization providing full cycle home ownership 
  3.26  services may apply directly to the agency. 
  3.27     Sec. 5.  [462A.209] [HOME OWNERSHIP ASSISTANCE.] 
  3.28     Subdivision 1.  [FULL CYCLE HOME OWNERSHIP SERVICES.] The 
  3.29  full cycle home ownership services program shall be used to fund 
  3.30  nonprofit organizations and political subdivisions providing, 
  3.31  building capacity to provide, or supporting full cycle lending 
  3.32  for home ownership to low and moderate income home buyers.  The 
  3.33  purpose of the program is to encourage private investment in 
  3.34  affordable housing and collaboration of nonprofit organizations 
  3.35  and political subdivisions with each other and private lenders 
  3.36  in providing full cycle lending services. 
  4.1      Subd. 2.  [DEFINITION.] "Full cycle home ownership services"
  4.2   means supporting eligible home buyers and owners through all 
  4.3   phases of purchasing and keeping a home, by providing 
  4.4   prepurchase home buyer education, prepurchase counseling and 
  4.5   credit repair, prepurchase property inspection and technical and 
  4.6   financial assistance to buyers in rehabilitating the home, 
  4.7   postpurchase and mortgage default counseling, postpurchase 
  4.8   assistance with home maintenance, entry cost assistance, and 
  4.9   access to flexible loan products. 
  4.10     Subd. 3.  [ELIGIBILITY.] The agency shall establish 
  4.11  eligibility criteria for nonprofit organizations and political 
  4.12  subdivisions to receive funding under this section.  The 
  4.13  eligibility criteria must require the nonprofit organization or 
  4.14  political subdivision to provide, to build capacity to provide, 
  4.15  or support full cycle home ownership services for eligible home 
  4.16  buyers.  The agency may fund a nonprofit organization or 
  4.17  political subdivision that will provide full cycle home 
  4.18  ownership services by coordinating with one or more other 
  4.19  organizations that will provide specific components of full 
  4.20  cycle home ownership services.  The agency may make exceptions 
  4.21  to providing all components of full cycle lending if justified 
  4.22  by the application.  If there are more applicants requesting 
  4.23  funding than there are funds available, the agency shall award 
  4.24  the funds on a competitive basis and also assure an equitable 
  4.25  geographic distribution of the available funds.  The eligibility 
  4.26  criteria must require the nonprofit organization or political 
  4.27  subdivision to have a demonstrated involvement in the local 
  4.28  community and to target the housing affordability needs of the 
  4.29  local community.  Partnerships and collaboration with 
  4.30  innovative, grass roots, or community-based initiatives shall be 
  4.31  encouraged.  The agency shall give priority to nonprofit 
  4.32  organizations and political subdivisions that provide matching 
  4.33  funds.  Applicants for funds under section 462A.057 may also 
  4.34  apply funds under this program. 
  4.35     Subd. 4.  [ENTRY COST HOME OWNERSHIP OPPORTUNITY 
  4.36  PROGRAM.] The agency may establish an entry cost home ownership 
  5.1   opportunity program, on terms and conditions it deems advisable, 
  5.2   to assist individuals with downpayment and closing costs to 
  5.3   finance the purchase of a home. 
  5.4      Sec. 6.  [462A.2095] [CONTRACT FOR DEED GUARANTEE ACCOUNT.] 
  5.5      Subdivision 1.  [CREATION.] The contract for deed guarantee 
  5.6   account is created as a separate account in the housing 
  5.7   development fund.  Money in the account is appropriated to the 
  5.8   agency for the purposes of this section.  The account consists 
  5.9   of money appropriated to the account and transferred from other 
  5.10  sources and all earnings from money in the account. 
  5.11     Subd. 2.  [ACCOUNT USES.] Money in the account may be used 
  5.12  to create a guarantee fund for the refinancing of contracts for 
  5.13  deed. 
  5.14     Sec. 7.  Minnesota Statutes 1994, section 462A.21, 
  5.15  subdivision 3b, is amended to read: 
  5.16     Subd. 3b.  [CAPACITY BUILDING GRANTS.] It may make capacity 
  5.17  building grants to nonprofit organizations, local government 
  5.18  units, Indian tribes, and Indian tribal organizations to expand 
  5.19  their capacity to provide affordable housing and housing-related 
  5.20  services.  The grants may be used to assess housing needs and to 
  5.21  develop and implement strategies to meet those needs, including 
  5.22  the creation or preservation of affordable housing, pre and post 
  5.23  purchase counseling and associated administrative costs, and the 
  5.24  linking of supportive services to the housing.  The agency shall 
  5.25  adopt rules specifying the eligible uses of grant money.  
  5.26  Funding priority must be given to those applicants that include 
  5.27  low-income persons in their membership, have provided 
  5.28  housing-related services to low-income people, and demonstrate a 
  5.29  local commitment of local resources, which may include in-kind 
  5.30  contributions.  Grants under this subdivision may be made only 
  5.31  with specific appropriations by the legislature. 
  5.32     Sec. 8.  Minnesota Statutes 1994, section 462A.21, 
  5.33  subdivision 8b, is amended to read: 
  5.34     Subd. 8b.  [FAMILY RENTAL HOUSING.] It may establish a 
  5.35  family rental housing assistance program to provide loans or 
  5.36  direct rental subsidies for housing for families with incomes of 
  6.1   up to 60 80 percent of area state median income.  Priority must 
  6.2   be given to those developments with resident families with the 
  6.3   lowest income.  The development may be financed by the agency or 
  6.4   other public or private lenders.  Direct rental subsidies must 
  6.5   be administered by the agency for the benefit of eligible 
  6.6   families.  Financial assistance provided under this subdivision 
  6.7   to recipients of aid to families with dependent children must be 
  6.8   in the form of vendor payments whenever possible.  Loans and 
  6.9   direct rental subsidies under this subdivision may be made only 
  6.10  with specific appropriations by the legislature.  The 
  6.11  limitations on eligible mortgagors contained in section 462A.03, 
  6.12  subdivision 13, do not apply to loans for the rehabilitation of 
  6.13  existing housing under this subdivision. 
  6.14     Sec. 9.  Minnesota Statutes 1994, section 462A.21, 
  6.15  subdivision 21, is amended to read: 
  6.16     Subd. 21.  [COMMUNITY REHABILITATION PROGRAM.] The 
  6.17  agency or its grantees may spend money for the purposes of the 
  6.18  community rehabilitation program authorized under section 
  6.19  462A.206 and may pay the costs and expenses necessary and 
  6.20  incidental to the development and operation of the program.  
  6.21     Sec. 10.  Minnesota Statutes 1994, section 462A.21, is 
  6.22  amended by adding a subdivision to read: 
  6.23     Subd. 22.  [CONTRACT FOR DEED GUARANTEE PROGRAM.] It may 
  6.24  expend money for the purposes of section 462A.2095 and may pay 
  6.25  the costs and expenses necessary and incidental to the 
  6.26  development and operation of the program authorized by section 
  6.27  462A.2095. 
  6.28     Sec. 11.  Minnesota Statutes 1994, section 504.33, 
  6.29  subdivision 2, is amended to read: 
  6.30     Subd. 2.  [CITY.] "City" means a any statutory or home rule 
  6.31  charter city located within the metropolitan area as defined in 
  6.32  section 473.121, subdivision 2, and any city of the first class 
  6.33  as defined in section 410.01 not included in the previous 
  6.34  definition.  The term "city" also includes, where applicable, a 
  6.35  port authority, economic development authority, a housing and 
  6.36  redevelopment authority, or any development agency established 
  7.1   under chapter 469 which share common boundaries with the city. 
  7.2      Sec. 12.  Minnesota Statutes 1994, section 504.33, 
  7.3   subdivision 3, is amended to read: 
  7.4      Subd. 3.  [DISPLACE.] "Displace" means to demolish, acquire 
  7.5   for or convert to a use other than low-income housing, or to 
  7.6   provide or spend money that directly results in the demolition, 
  7.7   acquisition, or conversion of housing to a use other than 
  7.8   low-income housing. 
  7.9      "Displace" does not include providing or spending money 
  7.10  that directly results in:  (i) housing improvements made to 
  7.11  comply with health, housing, building, fire prevention, housing 
  7.12  maintenance, or energy codes or standards of the applicable 
  7.13  government unit; (ii) housing improvements to make housing more 
  7.14  accessible to a handicapped person; or (iii) the demolition, 
  7.15  acquisition, or conversion of housing for the purpose of 
  7.16  creating owner-occupied housing that consists of no more than 
  7.17  four units per structure. 
  7.18     "Displace" does not include downsizing large apartment 
  7.19  complexes by demolishing less than 25 percent of the units in 
  7.20  the complex or by eliminating units through reconfiguration and 
  7.21  expansion of individual units for the purpose of expanding the 
  7.22  size of the remaining low-income units.  For the purpose of this 
  7.23  section, "large apartment complex" means two or more adjacent 
  7.24  buildings containing a total of 100 or more units per complex. 
  7.25     In any city in the metropolitan area, as defined in section 
  7.26  473.121, subdivision 2, which has met its housing affordability 
  7.27  goals under the metropolitan council's metropolitan development 
  7.28  guide, adopted under section 473.145, "displace" means the 
  7.29  demolition, acquisition, or conversion of housing only for 
  7.30  purposes other than the construction or rehabilitation of 
  7.31  housing. 
  7.32     Sec. 13.  Minnesota Statutes 1994, section 504.34, 
  7.33  subdivision 1, is amended to read: 
  7.34     Subdivision 1.  [ANNUAL REPORT REQUIRED.] A government 
  7.35  unit, or in the case of a government unit located in the 
  7.36  metropolitan area as defined in section 473.121, the government 
  8.1   unit and the metropolitan council, shall prepare a housing 
  8.2   impact report either: 
  8.3      (1) for each year in which the government unit displaces 
  8.4   ten or more units of low-income housing in a city of the first 
  8.5   class as defined in section 410.01; or 
  8.6      (2) when a specific project undertaken by a government unit 
  8.7   for longer than one year displaces a total of ten or more units 
  8.8   of low-income housing in a city of the first class as defined in 
  8.9   section 410.01. 
  8.10     Sec. 14.  Minnesota Statutes 1994, section 504.34, 
  8.11  subdivision 2, is amended to read: 
  8.12     Subd. 2.  [DRAFT ANNUAL HOUSING IMPACT REPORT.] As provided 
  8.13  in subdivision 1, a government unit or in the case of a 
  8.14  government unit participating with located in the metropolitan 
  8.15  area, as defined in section 473.121, subdivision 2, the 
  8.16  metropolitan council subject to this section must prepare a 
  8.17  draft annual housing impact report for review and comment by 
  8.18  interested persons.  The draft report must be completed by 
  8.19  January 31 of the year immediately following a year in which the 
  8.20  government unit has displaced ten or more units of low-income 
  8.21  housing in a city.  For a housing impact report required under 
  8.22  subdivision 1, clause (2), the draft report must be completed by 
  8.23  January 31 of the year immediately following the year in which 
  8.24  the government unit has displaced a cumulative total of ten 
  8.25  units of low-income housing in a city. 
  8.26     Sec. 15.  Minnesota Statutes 1994, section 504.35, is 
  8.27  amended to read: 
  8.28     504.35 [REPLACEMENT HOUSING REQUIRED.] 
  8.29     A government unit which displaces ten or more units of 
  8.30  low-income housing in a city of the first class as defined in 
  8.31  section 410.01 and is subject to section 504.34 or in any city 
  8.32  located within the metropolitan area as defined in section 
  8.33  473.121, subdivision 2, must provide the replacement housing 
  8.34  within 36 months following the date of the final annual housing 
  8.35  impact report, unless there is an adequate supply of available 
  8.36  and unoccupied low-income housing units to meet the demand for 
  9.1   the replacement housing in the city where housing has been 
  9.2   displaced by the government unit. 
  9.3      Sec. 16.  [AFFORDABLE NEIGHBORHOOD DESIGN AND DEVELOPMENT 
  9.4   INITIATIVE.] 
  9.5      In order to develop and implement methods of reducing the 
  9.6   total costs of housing units through the innovative use of 
  9.7   technology and planning, the housing finance agency shall 
  9.8   conduct a competition or secure proposals for innovative plans 
  9.9   for the development of housing units affordable to low-income 
  9.10  persons.  The agency shall seek models for use by local units of 
  9.11  government and nonprofit organizations to develop neighborhoods 
  9.12  with small, owner-occupied affordable housing.  The agency may 
  9.13  seek plans that reduce construction costs through technological 
  9.14  advancements, uniform housing designs suitable for use 
  9.15  throughout the state, central purchasing of material or housing 
  9.16  components, or streamlining of regulatory processes for site 
  9.17  planning and land development.  Designs selected become the 
  9.18  property of the state of Minnesota.  The agency may award one or 
  9.19  more premiums in each competition and may pay the costs and fees 
  9.20  that may be required for the conduct of competitions. 
  9.21     Sec. 17.  [APPLICATION.] 
  9.22     Sections 13 and 14 apply in the counties of Anoka, Carver, 
  9.23  Dakota, Hennepin, Ramsey, Scott, and Washington. 
  9.24                             ARTICLE 2
  9.25                      AGENCY TECHNICAL CHANGES
  9.26     Section 1.  Minnesota Statutes 1994, section 462A.202, 
  9.27  subdivision 2, is amended to read: 
  9.28     Subd. 2.  [TRANSITIONAL HOUSING.] The agency may make loans 
  9.29  with or without interest to cities and counties to finance the 
  9.30  acquisition, improvement, and rehabilitation of existing housing 
  9.31  properties or the acquisition, site improvement, and development 
  9.32  of new properties for the purposes of providing transitional 
  9.33  housing, upon terms and conditions the agency determines.  
  9.34  Preference must be given to cities that propose to acquire 
  9.35  properties being sold by the resolution trust corporation or the 
  9.36  department of housing and urban development.  Loans under this 
 10.1   subdivision are subject to the restrictions in subdivision 7. 
 10.2      Sec. 2.  Minnesota Statutes 1994, section 462A.202, 
 10.3   subdivision 6, is amended to read: 
 10.4      Subd. 6.  [NEIGHBORHOOD LAND TRUSTS.] The agency may make 
 10.5   loans with or without interest to cities and counties to finance 
 10.6   the capital costs of a land trust project undertaken pursuant to 
 10.7   sections 462A.30 and 462A.31.  Loans under this subdivision are 
 10.8   subject to the restrictions in subdivision 7. 
 10.9      Sec. 3.  Minnesota Statutes 1994, section 462A.205, 
 10.10  subdivision 4, is amended to read: 
 10.11     Subd. 4.  [AMOUNT AND PAYMENT OF RENT ASSISTANCE.] (a) This 
 10.12  subdivision applies to both the voucher option and the 
 10.13  project-based voucher option.  
 10.14     (b) Within the limits of available appropriations, eligible 
 10.15  families may receive monthly rent assistance for a 36-month 
 10.16  period starting with the month the family first receives rent 
 10.17  assistance under this section.  The amount of the family's 
 10.18  portion of the rental payment is equal to at least 30 percent of 
 10.19  gross income. 
 10.20     (c) The rent assistance must be paid by the local housing 
 10.21  organization to the property owner. 
 10.22     (d) Subject to the limitations in paragraph (e), the amount 
 10.23  of rent assistance is the difference between the rent and the 
 10.24  family's portion of the rental payment. 
 10.25     (e) In no case: 
 10.26     (1) may the amount of monthly rent assistance be more 
 10.27  than $250 for housing located within the metropolitan area, as 
 10.28  defined in section 473.121, subdivision 2, or more than $200 for 
 10.29  housing located outside of the metropolitan area; 
 10.30     (2) may the owner receive more rent for assisted units than 
 10.31  for comparable unassisted units; nor 
 10.32     (3) may the amount of monthly rent assistance be more than 
 10.33  the difference between the family's portion of the rental 
 10.34  payment and the fair market rent for the unit as determined by 
 10.35  the Department of Housing and Urban Development. 
 10.36     Sec. 4.  [462A.2097] [RENTAL HOUSING.] 
 11.1      The agency may establish a rental housing assistance 
 11.2   program for persons of low income or for persons with a mental 
 11.3   illness or families that include an adult family member with a 
 11.4   mental illness.  Rental assistance may be in the form of direct 
 11.5   rental subsidies for housing for persons or families with 
 11.6   incomes of up to 50 percent of the area median income as 
 11.7   determined by the United States Department of Housing and Urban 
 11.8   Development, adjusted for families of five or more.  Housing for 
 11.9   the mentally ill must be operated in coordination with social 
 11.10  service providers who provide services requested by tenants.  
 11.11  Direct rental subsidies must be administered by the agency for 
 11.12  the benefit of eligible tenants.  Financial assistance provided 
 11.13  under this section must be in the form of vendor payments 
 11.14  whenever possible. 
 11.15     Sec. 5.  Minnesota Statutes 1994, section 462A.21, is 
 11.16  amended by adding a subdivision to read: 
 11.17     Subd. 23.  [RENTAL HOUSING.] The agency may spend money for 
 11.18  the purposes of the rental housing program authorized under 
 11.19  section 462A.2097, and may pay the costs and expenses necessary 
 11.20  and incidental to the development and operation of the program. 
 11.21     Sec. 6.  Minnesota Statutes 1994, section 469.0171, is 
 11.22  amended to read: 
 11.23     469.0171 [HOUSING PLAN, PROGRAM, AND REVIEW.] 
 11.24     Prior to the issuance of bonds or obligations for a housing 
 11.25  development project proposed by an authority under section 
 11.26  469.017, the authority shall: 
 11.27     (1) prepare a plan meeting the requirements of section 
 11.28  462C.03, subdivision 1, paragraphs (a) to (d); 
 11.29     (2) obtain review of the plan in the manner provided in 
 11.30  section 462C.04, subdivision 1; and 
 11.31     (3) prepare and submit for review a program as defined in 
 11.32  section 462C.02, subdivision 3, in the manner provided in 
 11.33  section 462C.04, subdivision 2, and section 462C.05, subdivision 
 11.34  5, for the making or purchasing of loans by cities. 
 11.35     The authority shall prepare and submit the report required 
 11.36  under section 462C.04, subdivision 3. 
 12.1      Sec. 7.  [REPEALER.] 
 12.2      Minnesota Statutes 1994, section 462A.21, subdivision 8c, 
 12.3   is repealed. 
 12.4      Sec. 8.  [EFFECTIVE DATE.] 
 12.5      Sections 1 to 7 are effective the day following final 
 12.6   enactment. 
 12.7                              ARTICLE 3
 12.8                            APPROPRIATIONS
 12.9      Section 1.  [ECONOMIC SECURITY; TRANSITIONAL HOUSING.] 
 12.10     $....... is appropriated from the general fund to the 
 12.11  commissioner of the department of economic security for the 
 12.12  purpose of Minnesota Statutes, section 268.38, transitional 
 12.13  housing programs, to be available until June 30, 1997. 
 12.14     Sec. 2.  [HOUSING FINANCE AGENCY.] 
 12.15     Subdivision 1.  [HOUSING TRUST FUND.] $....... is 
 12.16  appropriated from the general fund to the housing development 
 12.17  fund for the housing trust fund account. 
 12.18     Subd. 2.  [CAPACITY BUILDING GRANTS.] $....... is 
 12.19  appropriated from the general fund to the housing development 
 12.20  fund for the purpose of making capacity building grants. 
 12.21     Subd. 3.  [LEAD ABATEMENT.] $....... is appropriated from 
 12.22  the general fund to the housing development fund for the purpose 
 12.23  of residential lead paint and lead contaminated soil abatement. 
 12.24     Subd. 4.  [MORTGAGE FORECLOSURE PREVENTION AND EMERGENCY 
 12.25  RENTAL ASSISTANCE.] $....... is appropriated from the general 
 12.26  fund to the housing development fund for the purpose of mortgage 
 12.27  foreclosure prevention and emergency rental assistance. 
 12.28     Subd. 5.  [FAMILY HOMELESS PREVENTION AND 
 12.29  ASSISTANCE.] $....... is appropriated from the general fund to 
 12.30  the housing development fund for the purpose of family homeless 
 12.31  prevention and assistance. 
 12.32     Subd. 6.  [AFFORDABLE RENTAL INVESTMENT.] $....... is 
 12.33  appropriated from the general fund to the housing development 
 12.34  fund for the purpose of affordable rental investment.  To the 
 12.35  extent practicable, these funds shall be expended 50 percent in 
 12.36  the metropolitan area, as defined in Minnesota Statutes, section 
 13.1   473.121, subdivision 2, and 50 percent in areas of the state 
 13.2   outside the metropolitan area according to the following 
 13.3   procedures: 
 13.4      (a) In the area of the state outside the metropolitan area, 
 13.5   the agency must work with groups in the McKnight Initiative Fund 
 13.6   regions to assist the agency in identifying the affordable 
 13.7   housing needed in each region in connection with economic 
 13.8   development and redevelopment efforts and in establishing 
 13.9   priorities for uses of the affordable rental investment fund. 
 13.10  The groups must include the McKnight Initiative Funds, the 
 13.11  regional development commissioners, the private industry 
 13.12  councils, units of local government, community action agencies, 
 13.13  the Minnesota housing partnership network groups, local lenders, 
 13.14  for-profit and nonprofit developers, and realtors.  In addition 
 13.15  to priorities developed by the group, the agency must give a 
 13.16  preference to economically viable projects in which units of 
 13.17  local government, area employers, and the private sector 
 13.18  contribute financial assistance.  
 13.19     (b) In the metropolitan area, the commissioner shall 
 13.20  collaborate with the metropolitan council to identify the 
 13.21  priorities for use of the affordable rental investment fund.  
 13.22  Funds distributed in the metropolitan area must be consistent 
 13.23  with the objectives of the metropolitan development guide, 
 13.24  adopted under Minnesota Statutes, section 473.145.  In addition 
 13.25  to the priorities identified in conjunction with the 
 13.26  metropolitan council, the agency shall give preference to 
 13.27  economically viable projects that: 
 13.28     (1) include a contribution of financial resources from 
 13.29  units of local government and area employers; 
 13.30     (2) take into account the availability of transportation in 
 13.31  the community; and 
 13.32     (3) take into account the job training efforts in the 
 13.33  community. 
 13.34     Subd. 7.  [COMMUNITY REHABILITATION PROGRAM.] $....... is 
 13.35  appropriated from the general fund to the housing development 
 13.36  fund for the community rehabilitation program.  Of this amount, 
 14.1   $....... is set aside for full cycle home ownership and 
 14.2   purchase-rehabilitation lending initiatives.  The appropriation 
 14.3   in this subdivision may only be used for programs located in a 
 14.4   census tract and the surrounding eight blocks, as blocks are 
 14.5   determined by the local unit of government, that meet at least 
 14.6   four of the five following criteria: 
 14.7      (1) at least 70 percent of the housing structures are at 
 14.8   least 35 years old; 
 14.9      (2) at least 60 percent of the single-family housing is 
 14.10  owner-occupied; 
 14.11     (3) the median value, as recorded in the 1990 federal 
 14.12  decennial census, of the area's owner-occupied housing is not 
 14.13  more than 100 percent of the purchase price limit for existing 
 14.14  homes eligible for purchase in the area under the agency's home 
 14.15  mortgage loan program; 
 14.16     (4) the geographic area consists of contiguous parcels of 
 14.17  land; and 
 14.18     (5) between 1980 and 1990, the number of owner-occupied 
 14.19  residential properties in the area declined by five percent, or 
 14.20  at least 80 percent of the residential properties in the area 
 14.21  are rental properties. 
 14.22     The appropriation in this subdivision may be used only for 
 14.23  grants and loans for owner-occupied housing.  Priority must be 
 14.24  given for property located in an area where the median household 
 14.25  income is no more than one-half the median household income for 
 14.26  the area as determined by the 1990 federal decennial census. 
 14.27     Subd. 8.  [AFFORDABLE NEIGHBORHOOD DESIGN AND DEVELOPMENT 
 14.28  INITIATIVE.] $....... is appropriated from the general fund to 
 14.29  the housing development fund for the purposes of the affordable 
 14.30  neighborhood design and development initiative in article 1, 
 14.31  section 16.