SF 2742

Introduction - 94th Legislature (2025 - 2026)

Posted on 03/21/2025 09:53 a.m.

A bill for an act
relating to housing; requiring a report on the affordable housing industry; setting
a maximum compliance period for certain low-income tax credit commitment
requirements; requiring the commissioner of the Minnesota Housing Finance
Agency to identify avenues for potential regulatory relief to affordable housing
providers; transferring money; appropriating money; amending Minnesota Statutes
2024, sections 462A.07, subdivision 19, by adding a subdivision; 462A.222, by
adding a subdivision.

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

Section 1.

Minnesota Statutes 2024, section 462A.07, subdivision 19, is amended to read:

Subd. 19.

Report to the legislature.

(a) By February 15 each year, the commissioner
must submit a report to the chairs and ranking minority members of the legislative committees
having jurisdiction over housing finance and policy containing the following information:

(1) the total number of applications for funding;

(2) the amount of funding requested;

(3) the amounts of funding awarded; and

(4) the number of housing units that are affected by funding awards, including the number
of:

(i) newly constructed owner-occupied units;

(ii) renovated owner-occupied units;

(iii) newly constructed rental units; and

(iv) renovated rental units.

(b) This reporting requirement applies to appropriations for competitive development
programs made in Laws 2023 and in subsequent laws.

new text begin (c) By January 5 each year, the commissioner must report on the financial stability of
the affordable housing industry. The report must include:
new text end

new text begin (1) the ratio of operating expenses to revenue in affordable rental housing projects; and
new text end

new text begin (2) the percent of rents collected on time, divided into four regions of the state:
new text end

new text begin (i) the cities of St. Paul and Minneapolis;
new text end

new text begin (ii) the metropolitan counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and
Washington, except for the cities of St. Paul and Minneapolis;
new text end

new text begin (iii) urban greater Minnesota, including the cities of Duluth, Mankato, Moorhead,
Rochester, and St. Cloud; and
new text end

new text begin (iv) rural greater Minnesota, which includes all of Minnesota, except for the places listed
in items (i), (ii), and (iii).
new text end

Sec. 2.

Minnesota Statutes 2024, section 462A.07, is amended by adding a subdivision to
read:

new text begin Subd. 21. new text end

new text begin Local affordable housing aid annual meeting. new text end

new text begin At least once each year, the
commissioner must convene a meeting with the Interagency Council to End Homelessness
and the cities and counties receiving local affordable housing aid under section 477A.35.
The purpose of the meeting is to discuss: (1) the impacts of local affordable housing aid;
(2) regional needs for affordable housing; and (3) recommendations for the collaborative
use of funds to effectively address homelessness, housing insecurity, security of affordable
housing, and the lack of housing supply.
new text end

Sec. 3.

Minnesota Statutes 2024, section 462A.222, is amended by adding a subdivision
to read:

new text begin Subd. 5. new text end

new text begin Commitment restriction. new text end

new text begin The commissioner may not require commitment
terms longer than the compliance period required under section 42 of the Internal Revenue
Code of 1986, as amended.
new text end

Sec. 4. new text begin POLICY FRAMEWORK FOR TARGETED STABILIZATION OF
REGULATED AFFORDABLE HOUSING.
new text end

new text begin (a) The commissioner of the Minnesota Housing Finance Agency must develop a policy
framework for targeted stabilization of affordable rental housing. In developing this
framework, the commissioner must identify strategies, tools, and funding mechanisms for
targeted stabilization of affordable rental housing and recapitalization of distressed properties.
The commissioner must identify potential improvements for regulatory relief for affordable
rental housing providers and implement these improvements where feasible.
new text end

new text begin (b) By January 5, 2026, the commissioner must report to the chairs and ranking minority
members of the legislative committees with jurisdiction over housing finance and policy
on the policy framework, improvements implemented, and propose legislation that may be
needed to support targeted stabilization of regulated affordable housing and recapitalization
of distressed properties.
new text end

Sec. 5. new text begin INTERAGENCY STABILIZATION GROUP.
new text end

new text begin The commissioner of the Minnesota Housing Finance Agency may convene regular
meetings of public funders and affordable housing stakeholders to seek funding solutions
that support preservation and stabilization of affordable properties.
new text end

Sec. 6. new text begin TRANSFER; HOUSING DEVELOPMENT FUND.
new text end

new text begin $....... in fiscal year 2026 and $....... in fiscal year 2027 are transferred from the general
fund to the housing development fund. This transfer is $....... in fiscal year 2028 and each
year thereafter.
new text end

Sec. 7. new text begin APPROPRIATION; TARGETED STABILIZATION POLICY
FRAMEWORK.
new text end

new text begin $....... in fiscal year 2026 is appropriated from the housing development fund to the
commissioner of the Minnesota Housing Finance Agency to develop a policy framework
for targeted stabilization of affordable rental housing. This is a onetime appropriation.
new text end