1.1                          A bill for an act 
  1.2             relating to the housing finance agency; making 
  1.3             technical changes to requirements under single family 
  1.4             housing programs; amending Minnesota Statutes 1994, 
  1.5             sections 462A.05, subdivisions 14a and 18; and 
  1.6             462A.07, subdivision 14.  
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 1994, section 462A.05, 
  1.9   subdivision 14a, is amended to read: 
  1.10     Subd. 14a.  [REHABILITATION LOANS; EXISTING OWNER OCCUPIED 
  1.11  RESIDENTIAL HOUSING.] It may make loans to persons and families 
  1.12  of low and moderate income to rehabilitate or to assist in 
  1.13  rehabilitating existing residential housing owned and occupied 
  1.14  by those persons or families.  No loan shall be made unless the 
  1.15  agency determines that the loan will be used primarily for 
  1.16  rehabilitation work necessary for health or safety, essential 
  1.17  accessibility improvements, or to improve the energy efficiency 
  1.18  of the dwelling.  No loan for rehabilitation of owner occupied 
  1.19  residential housing shall be denied solely because the loan will 
  1.20  not be used for placing the residential housing in full 
  1.21  compliance with all state, county or municipal building, housing 
  1.22  maintenance, fire, health or similar codes and standards 
  1.23  applicable to housing.  The amount of any loan shall not exceed 
  1.24  the lesser of (a) $10,000 a maximum loan amount determined under 
  1.25  rules adopted by the agency not to exceed $20,000, or (b) the 
  1.26  actual cost of the work performed, or (c) that portion of the 
  2.1   cost of rehabilitation which the agency determines cannot 
  2.2   otherwise be paid by the person or family without the 
  2.3   expenditure of an unreasonable portion of the income of the 
  2.4   person or family.  Loans made in whole or in part with federal 
  2.5   funds may exceed the maximum loan amount to the extent necessary 
  2.6   to comply with federal lead abatement requirements prescribed by 
  2.7   the funding source.  In making loans, the agency shall determine 
  2.8   the circumstances under which and the terms and conditions under 
  2.9   which all or any portion of the loan will be repaid and shall 
  2.10  determine the appropriate security for the repayment of the 
  2.11  loan.  Loans pursuant to this subdivision may be made with or 
  2.12  without interest or periodic payments.  Loans made without 
  2.13  interest or periodic payments need not be repaid by the borrower 
  2.14  if the property for which the loan is made has not been sold, 
  2.15  transferred, or otherwise conveyed nor has it ceased to be the 
  2.16  principal place of residence of the borrower, within ten years 
  2.17  after the date of the loan.  
  2.18     Sec. 2.  Minnesota Statutes 1994, section 462A.05, 
  2.19  subdivision 18, is amended to read: 
  2.20     Subd. 18.  [LOANS TO NONPROFIT SPONSORS.] It may make loans 
  2.21  to "nonprofit" sponsors as defined by the agency, with or 
  2.22  without interest, and with such security for repayment, if any, 
  2.23  as the agency determines reasonably necessary and practicable, 
  2.24  solely from the housing development fund in accordance with the 
  2.25  provisions of section 462A.21, subdivision 9, to encourage 
  2.26  innovations in the development or rehabilitation of single and 
  2.27  multifamily residential housing including the demonstration of 
  2.28  new techniques for energy efficient construction.  It may make 
  2.29  loans to for-profit sponsors pursuant to this subdivision, 
  2.30  provided that the agency shall make the loan with interest at a 
  2.31  rate determined by the agency.  
  2.32     It shall promulgate rules, in accordance with chapter 14, 
  2.33  relating to the administration of the loans authorized by this 
  2.34  subdivision.  The rules may define types of projects eligible 
  2.35  for loans, criteria for selecting between eligible loans, terms 
  2.36  of the loans including interest rates and loan periods, and 
  3.1   other characteristics that the agency deems necessary to 
  3.2   administer the program. 
  3.3      Sec. 3.  Minnesota Statutes 1994, section 462A.07, 
  3.4   subdivision 14, is amended to read: 
  3.5      Subd. 14.  [AMERICAN INDIANS.] (a) It may engage in housing 
  3.6   programs for low- and moderate-income American Indians developed 
  3.7   and administered separately or in combination by the Minnesota 
  3.8   Chippewa tribe, the Red Lake band of Chippewa Indians, and the 
  3.9   Sioux communities as determined by such tribe, band, or 
  3.10  communities.  In furtherance of the policy of economic 
  3.11  integration stated in section 462A.02, subdivision 6, it may 
  3.12  engage in housing programs for American Indians who intend to 
  3.13  reside on reservations and who are not persons of low and 
  3.14  moderate income, provided that the aggregate dollar amount of 
  3.15  the loans for persons who are not of low- or moderate-income 
  3.16  closed in each lender's fiscal year shall not exceed an amount 
  3.17  equal to 25 percent of the total dollar amount of all loans made 
  3.18  closed by that lender during the lender's fiscal year at the 
  3.19  time of loan application same fiscal year.  In developing such 
  3.20  housing programs, the tribe, band, or communities shall take 
  3.21  into account the housing needs of all American Indians residing 
  3.22  both on and off reservations within the state.  A plan for each 
  3.23  such program, which specifically describes the program content, 
  3.24  utilization of funds, administration, operation, implementation 
  3.25  and other matter, as determined by the agency, must be submitted 
  3.26  to the agency for its review and approval prior to the making of 
  3.27  eligible loans pursuant to section 462A.21.  All such programs 
  3.28  must conform to rules promulgated by the agency concerning 
  3.29  program administration, including but not limited to rules 
  3.30  concerning costs of administration; the quality of housing; 
  3.31  interest rates, fees, and charges in connection with making 
  3.32  eligible loans; and other matters determined by the agency to be 
  3.33  necessary in order to effectuate the purposes of this 
  3.34  subdivision and section 462A.21, subdivisions 4b and 4c.  All 
  3.35  such programs must provide for a reasonable balance in the 
  3.36  distribution of funds appropriated for the purpose of this 
  4.1   section between American Indians residing on and off 
  4.2   reservations within the state.  Nothing in this section shall 
  4.3   preclude such tribe, band, or communities from requesting and 
  4.4   receiving cooperation, advice, and assistance from the agency as 
  4.5   regards program development, operation, delivery, financing, or 
  4.6   administration.  As a condition to the making of such eligible 
  4.7   loans, the Minnesota Chippewa tribe, the Red Lake band of 
  4.8   Chippewa Indians, and the Sioux communities shall: 
  4.9      (1) enter into a loan agreement and other contractual 
  4.10  arrangements with the agency for the purpose of transferring the 
  4.11  allocated portion of loan funds as set forth in section 462A.26 
  4.12  and to insure compliance with the provisions of this section and 
  4.13  this chapter; and 
  4.14     (2) agree that all of their official books and records 
  4.15  related to such housing programs shall be subjected to audit by 
  4.16  the legislative auditor in the manner prescribed for agencies of 
  4.17  state government. 
  4.18     The agency shall submit a biennial report concerning the 
  4.19  various housing programs for American Indians, and related 
  4.20  receipts and expenditures as provided in section 462A.22, 
  4.21  subdivision 9, and such tribe, band, or communities to the 
  4.22  extent that they administer such programs, shall be responsible 
  4.23  for any costs and expenses related to such administration 
  4.24  provided, however, they shall be eligible for payment for costs, 
  4.25  expenses, and services pursuant to subdivision 12 and section 
  4.26  462A.21.  The agency may provide or cause to be provided 
  4.27  essential general technical services as set forth in subdivision 
  4.28  2, and general consultative project assistance services, 
  4.29  including, but not limited to, management training, and home 
  4.30  ownership counseling as set forth in subdivision 3.  Members of 
  4.31  boards, committees, or other governing bodies of the tribe, 
  4.32  band, and communities administering the programs authorized by 
  4.33  this subdivision must be compensated for those services as 
  4.34  provided in section 15.0575.  Rules promulgated under this 
  4.35  subdivision may be promulgated as emergency rules under chapter 
  4.36  14. 
  5.1      (b) The agency may engage in demonstration projects to 
  5.2   encourage the participation of financial institutions or other 
  5.3   leveraging sources in providing housing opportunities for 
  5.4   American Indians.  The agency shall consult with the Minnesota 
  5.5   Chippewa tribe, the Red Lake band of Chippewa Indians, and the 
  5.6   Sioux communities in developing the demonstration projects.  The 
  5.7   income limits specified in paragraph (a) do not apply to the 
  5.8   demonstration projects. 
  5.9      (c) The agency may make home improvement loans under this 
  5.10  subdivision without regard to household income.