1.1                          A bill for an act 
  1.2             relating to housing; changing age limitations under 
  1.3             the family homeless prevention and assistance program; 
  1.4             modifying the rental housing program and various other 
  1.5             programs of the housing finance agency; correcting 
  1.6             references to municipal housing plan reporting 
  1.7             requirements; amending Minnesota Statutes 1994, 
  1.8             sections 462A.05, subdivisions 14 and 30; 462A.202, 
  1.9             subdivisions 2 and 6; 462A.204, subdivision 1; 
  1.10            462A.205, subdivision 4; 462A.21, subdivisions 8, 8b, 
  1.11            13, and by adding a subdivision; and 469.0171; 
  1.12            proposing coding for new law in Minnesota Statutes, 
  1.13            chapter 462A; repealing Minnesota Statutes 1994, 
  1.14            sections 462A.05, subdivision 14d; and 462A.21, 
  1.15            subdivision 8c. 
  1.16  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.17     Section 1.  Minnesota Statutes 1994, section 462A.05, 
  1.18  subdivision 14, is amended to read: 
  1.19     Subd. 14.  [REHABILITATION LOANS.] It may agree to 
  1.20  purchase, make, or otherwise participate in the making, and may 
  1.21  enter into commitments for the purchase, making, or 
  1.22  participation in the making, of eligible loans for 
  1.23  rehabilitation to persons and families of low and moderate 
  1.24  income, and to owners of existing residential housing for 
  1.25  occupancy by such persons and families, for the rehabilitation 
  1.26  of existing residential housing owned by them.  The loans may be 
  1.27  insured or uninsured and may be made with security, or may be 
  1.28  unsecured, as the agency deems advisable.  The loans may be in 
  1.29  addition to or in combination with long-term eligible mortgage 
  1.30  loans under subdivision 3.  They may be made in amounts 
  2.1   sufficient to refinance existing indebtedness secured by the 
  2.2   property, if refinancing is determined by the agency to be 
  2.3   necessary to permit the owner to meet the owner's housing cost 
  2.4   without expending an unreasonable portion of the owner's income 
  2.5   thereon.  No loan for rehabilitation shall be made unless the 
  2.6   agency determines that the loan will be used primarily to make 
  2.7   the housing more desirable to live in, to increase the market 
  2.8   value of the housing, for compliance with state, county or 
  2.9   municipal building, housing maintenance, fire, health or similar 
  2.10  codes and standards applicable to housing, or to accomplish 
  2.11  energy conservation related improvements.  In unincorporated 
  2.12  areas and municipalities not having codes and standards, the 
  2.13  agency may, solely for the purpose of administering the 
  2.14  provisions of this chapter, establish codes and standards.  
  2.15  Except for accessibility improvements under this subdivision 14d 
  2.16  and subdivisions 14a and 24, clause (1), no secured loan for 
  2.17  rehabilitation of any property shall be made in an amount which, 
  2.18  with all other existing indebtedness secured by the property, 
  2.19  would exceed its market value, as determined by the agency.  No 
  2.20  loan under this subdivision shall be denied solely because the 
  2.21  loan will not be used for placing the residential housing in 
  2.22  full compliance with all state, county, or municipal building, 
  2.23  housing maintenance, fire, health, or similar codes and 
  2.24  standards applicable to housing.  Rehabilitation loans shall be 
  2.25  made only when the agency determines that financing is not 
  2.26  otherwise available, in whole or in part, from private lenders 
  2.27  upon equivalent terms and conditions.  Accessibility 
  2.28  rehabilitation loans authorized under this subdivision may be 
  2.29  made to eligible persons and families without limitations 
  2.30  relating to the maximum incomes of the borrowers if: 
  2.31     (1) the borrower or a member of the borrower's family 
  2.32  requires a level of care provided in a hospital, skilled nursing 
  2.33  facility, or intermediate care facility for persons with mental 
  2.34  retardation or related conditions; 
  2.35     (2) home care is appropriate; and 
  2.36     (3) the improvement will enable the borrower or a member of 
  3.1   the borrower's family to reside in the housing. 
  3.2      Sec. 2.  Minnesota Statutes 1994, section 462A.05, 
  3.3   subdivision 30, is amended to read: 
  3.4      Subd. 30.  [AGENCY INVESTMENT IN CERTAIN NOTES AND 
  3.5   MORTGAGES.] It may invest in, purchase, acquire, and take 
  3.6   assignments of existing notes and mortgages not closed for the 
  3.7   purpose of sale to the agency, from lenders that are nonprofit 
  3.8   or nonprofit entities, as defined in the agency's rules, 
  3.9   provided that:  (1) the notes and mortgages evidence loans for 
  3.10  the construction, rehabilitation, purchase, improvement, or 
  3.11  refinancing of residential housing intended for occupancy and 
  3.12  occupied by low- and moderate-income persons and families; and 
  3.13  (2) the loan sellers utilize the funds derived from the 
  3.14  purchases in accordance with the authority contained in section 
  3.15  462A.07, subdivision 12, for the purposes and objectives of 
  3.16  sections 462A.02, 462A.03, 462A.05, 462A.07, and 462A.21; and 
  3.17  (3) the purchases are subject to security and limitations on the 
  3.18  costs and expenses of the loan sellers incidental to the 
  3.19  utilization of the purchase proceeds as the agency may 
  3.20  determine.  The proceeds of the purchases authorized by this 
  3.21  subdivision shall not be subject to the limitations of section 
  3.22  462A.21, subdivisions 4k, 6, 9, and 12.  In addition, it may 
  3.23  invest in, purchase, acquire, and take assignments of existing 
  3.24  federally insured mortgages for multifamily housing, not closed 
  3.25  for the purpose of sale to the agency, from any banking 
  3.26  institution, savings and loan association, or other lender or 
  3.27  financial intermediary approved by the members provided that the 
  3.28  multifamily housing is benefited by contracts for federal 
  3.29  housing assistance payments. 
  3.30     Sec. 3.  Minnesota Statutes 1994, section 462A.202, 
  3.31  subdivision 2, is amended to read: 
  3.32     Subd. 2.  [TRANSITIONAL HOUSING.] The agency may make loans 
  3.33  with or without interest to cities and counties to finance the 
  3.34  acquisition, improvement, and rehabilitation of existing housing 
  3.35  properties or the acquisition, site improvement, and development 
  3.36  of new properties for the purposes of providing transitional 
  4.1   housing, upon terms and conditions the agency determines.  
  4.2   Preference must be given to cities that propose to acquire 
  4.3   properties being sold by the resolution trust corporation or the 
  4.4   department of housing and urban development.  Loans under this 
  4.5   subdivision are subject to the restrictions in subdivision 7. 
  4.6      Sec. 4.  Minnesota Statutes 1994, section 462A.202, 
  4.7   subdivision 6, is amended to read: 
  4.8      Subd. 6.  [NEIGHBORHOOD LAND TRUSTS.] The agency may make 
  4.9   loans with or without interest to cities and counties to finance 
  4.10  the capital costs of a land trust project undertaken pursuant to 
  4.11  sections 462A.30 and 462A.31.  Loans under this subdivision are 
  4.12  subject to the restrictions in subdivision 7. 
  4.13     Sec. 5.  Minnesota Statutes 1994, section 462A.204, 
  4.14  subdivision 1, is amended to read: 
  4.15     Subdivision 1.  [ESTABLISHMENT.] The agency may establish a 
  4.16  family homeless prevention and assistance program to assist 
  4.17  families who are homeless or are at imminent risk of 
  4.18  homelessness.  The agency may make grants to develop and 
  4.19  implement family homeless prevention and assistance projects 
  4.20  under the program.  For purposes of this section, "families" 
  4.21  means families and persons under the age of 18 22.  
  4.22     Sec. 6.  Minnesota Statutes 1994, section 462A.205, 
  4.23  subdivision 4, is amended to read: 
  4.24     Subd. 4.  [AMOUNT AND PAYMENT OF RENT ASSISTANCE.] (a) This 
  4.25  subdivision applies to both the voucher option and the 
  4.26  project-based voucher option.  
  4.27     (b) Within the limits of available appropriations, eligible 
  4.28  families may receive monthly rent assistance for a 36-month 
  4.29  period starting with the month the family first receives rent 
  4.30  assistance under this section.  The amount of the family's 
  4.31  portion of the rental payment is equal to at least 30 percent of 
  4.32  gross income. 
  4.33     (c) The rent assistance must be paid by the local housing 
  4.34  organization to the property owner. 
  4.35     (d) Subject to the limitations in paragraph (e), the amount 
  4.36  of rent assistance is the difference between the rent and the 
  5.1   family's portion of the rental payment. 
  5.2      (e) In no case: 
  5.3      (1) may the amount of monthly rent assistance be more 
  5.4   than $250 for housing located within the metropolitan area, as 
  5.5   defined in section 473.121, subdivision 2, or more than $200 for 
  5.6   housing located outside of the metropolitan area; 
  5.7      (2) may the owner receive more rent for assisted units than 
  5.8   for comparable unassisted units; nor 
  5.9      (3) may the amount of monthly rent assistance be more than 
  5.10  the difference between the family's portion of the rental 
  5.11  payment and the fair market rent for the unit as determined by 
  5.12  the Department of Housing and Urban Development. 
  5.13     Sec. 7.  [462A.209] [RENTAL HOUSING.] 
  5.14     The agency may establish a rental housing assistance 
  5.15  program for persons of low income or for persons with a mental 
  5.16  illness or families that include an adult family member with a 
  5.17  mental illness.  Rental assistance may be in the form of direct 
  5.18  rental subsidies for housing for persons or families with 
  5.19  incomes of up to 50 percent of the area median income as 
  5.20  determined by the United States Department of Housing and Urban 
  5.21  Development, adjusted for families of five or more.  Housing for 
  5.22  the mentally ill must be operated in coordination with social 
  5.23  service providers who provide services requested by tenants.  
  5.24  Direct rental subsidies must be administered by the agency for 
  5.25  the benefit of eligible tenants.  Financial assistance provided 
  5.26  under this section must be in the form of vendor payments 
  5.27  whenever possible. 
  5.28     Sec. 8.  Minnesota Statutes 1994, section 462A.21, 
  5.29  subdivision 8, is amended to read: 
  5.30     Subd. 8.  [HOME OWNERSHIP ASSISTANCE FUND.] It may 
  5.31  establish a home ownership assistance fund, on terms and 
  5.32  conditions it deems advisable, to assist persons and families of 
  5.33  low and moderate income in the purchase of affordable 
  5.34  residential housing and may use the funds to provide loans, 
  5.35  additional security for eligible loans, or to pay costs 
  5.36  associated with or provide additional security for bonds issued 
  6.1   by the agency.  
  6.2      Sec. 9.  Minnesota Statutes 1994, section 462A.21, 
  6.3   subdivision 8b, is amended to read: 
  6.4      Subd. 8b.  [FAMILY RENTAL HOUSING.] It may establish a 
  6.5   family rental housing assistance program to provide loans or 
  6.6   direct rental subsidies for housing for families with incomes of 
  6.7   up to 60 80 percent of area state median income.  Priority must 
  6.8   be given to those developments with resident families with the 
  6.9   lowest income.  The development may be financed by the agency or 
  6.10  other public or private lenders.  Direct rental subsidies must 
  6.11  be administered by the agency for the benefit of eligible 
  6.12  families.  Financial assistance provided under this subdivision 
  6.13  to recipients of aid to families with dependent children must be 
  6.14  in the form of vendor payments whenever possible.  Loans and 
  6.15  direct rental subsidies under this subdivision may be made only 
  6.16  with specific appropriations by the legislature.  The 
  6.17  limitations on eligible mortgagors contained in section 462A.03, 
  6.18  subdivision 13, do not apply to loans for the rehabilitation of 
  6.19  existing housing under this subdivision. 
  6.20     Sec. 10.  Minnesota Statutes 1994, section 462A.21, 
  6.21  subdivision 13, is amended to read: 
  6.22     Subd. 13.  [ACCESSIBILITY PROGRAMS.] It may spend money for 
  6.23  the purpose purposes of section 462A.05, subdivision 
  6.24  subdivisions 14, 14a, and 24, and may pay the costs and expenses 
  6.25  necessary and incidental to the development and operation of the 
  6.26  programs authorized in that subdivision those subdivisions. 
  6.27     Sec. 11.  Minnesota Statutes 1994, section 462A.21, is 
  6.28  amended by adding a subdivision to read: 
  6.29     Subd. 22.  [RENTAL HOUSING.] The agency may spend money for 
  6.30  the purposes of the rental housing program authorized under 
  6.31  section 462A.209, and may pay the costs and expenses necessary 
  6.32  and incidental to the development and operation of the program. 
  6.33     Sec. 12.  Minnesota Statutes 1994, section 469.0171, is 
  6.34  amended to read: 
  6.35     469.0171 [HOUSING PLAN, PROGRAM, AND REVIEW.] 
  6.36     Prior to the issuance of bonds or obligations for a housing 
  7.1   development project proposed by an authority under section 
  7.2   469.017, the authority shall: 
  7.3      (1) prepare a plan meeting the requirements of section 
  7.4   462C.03, subdivision 1, paragraphs (a) to (d); 
  7.5      (2) obtain review of the plan in the manner provided in 
  7.6   section 462C.04, subdivision 1; and 
  7.7      (3) prepare and submit for review a program as defined in 
  7.8   section 462C.02, subdivision 3, in the manner provided in 
  7.9   section 462C.04, subdivision 2, and section 462C.05, subdivision 
  7.10  5, for the making or purchasing of loans by cities.  
  7.11     The authority must prepare and submit the report required 
  7.12  under section 462C.04, subdivision 3. 
  7.13     Sec. 13.  [REPEALER.] 
  7.14     Minnesota Statutes 1994, sections 462A.05, subdivision 14d; 
  7.15  and 462A.21, subdivision 8c, are repealed. 
  7.16     Sec. 14.  [EFFECTIVE DATE.] 
  7.17     Sections 1, 5 to 7, and 11 to 13 are effective the day 
  7.18  following final enactment.