HF 2585

as introduced - 93rd Legislature (2023 - 2024) Posted on 03/06/2023 11:40am

A bill for an act
relating to housing; establishing a fee-based, first-time homebuyer home purchase
financing program; requiring a report; appropriating money.

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

Section 1. new text begin FIRST-TIME HOMEBUYER, FEE-BASED HOME PURCHASE
FINANCING PROGRAM; APPROPRIATION.
new text end

new text begin Subdivision 1. new text end

new text begin Appropriation. new text end

new text begin $20,000,000 in fiscal year 2024 is appropriated from
the general fund to the commissioner of the Housing Finance Agency for a grant to
NeighborWorks Home Partners to finance home purchasing through down payment assistance
to eligible homebuyers using non-interest-bearing, fee-based loan products. The Housing
Finance Agency must release grant funds as needed, and may do so in tranches for
administrative efficiency. This appropriation is onetime and is available until June 30, 2025.
new text end

new text begin Subd. 2. new text end

new text begin Administration. new text end

new text begin A first-time homebuyer, fee-based home purchasing financing
program is established as a pilot project under the administration of NeighborWorks Home
Partners.
new text end

new text begin Subd. 3. new text end

new text begin Eligible homebuyer. new text end

new text begin For the purposes of this section, an "eligible homebuyer"
means an individual:
new text end

new text begin (1) whose income is at or below 130 percent of area median income;
new text end

new text begin (2) who resides in a census tract where at least 60 percent of occupied housing units are
renter-occupied, based on the most recent estimates or experimental estimates provided by
the American Community Survey of the United States Census Bureau;
new text end

new text begin (3) who is financing the purchase of an eligible property with an interest-free, fee-based
mortgage; and
new text end

new text begin (4) who is a first-time homebuyer as defined by Code of Federal Regulations, title 24,
section 92.2.
new text end

new text begin Subd. 4. new text end

new text begin Eligible property. new text end

new text begin (a) For the purposes of this section, an "eligible property"
means residential real property that is a condominium, a townhouse, a single-family home,
a manufactured home titled as real property, or another building containing up to four
dwelling units.
new text end

new text begin (b) An eligible property may include property subject to a ground lease with a community
land trust, property on Indian Trust Land, or property participating in a shared equity
homeownership program.
new text end

new text begin Subd. 5. new text end

new text begin Use of funds. new text end

new text begin NeighborWorks Home Partners shall use the money appropriated
under subdivision 1 to provide forgivable grants of down payment assistance not to exceed
30 percent of the price of the eligible property that an eligible homebuyer seeks to purchase.
NeighborWorks Home Partners shall provide grants to eligible homebuyers using no-interest,
fee-based loans to finance the purchase of eligible properties. In making grants,
NeighborWorks Home Partners shall determine the circumstances, terms, and conditions
under which all or any portion of the grant will be repaid and shall determine the appropriate
security required for a repayment. The administrative fees for operating the program shall
not exceed five percent of the appropriation. An eligible homebuyer may use the funds in
conjunction with any other funding programs.
new text end

new text begin Subd. 6. new text end

new text begin Conditions of receiving a grant. new text end

new text begin (a) To qualify for assistance under this section,
an eligible homebuyer must:
new text end

new text begin (1) complete an approved homebuyer education course prior to signing a purchase
agreement;
new text end

new text begin (2) complete an approved landlord education course prior to signing a purchase agreement
if the property being purchased contains more than one dwelling unit;
new text end

new text begin (3) contribute a minimum of $1,000 to down payment or closing costs; and
new text end

new text begin (4) occupy the purchased property as the homebuyer's primary residence.
new text end

new text begin (b) NeighborWorks Home Partners may establish additional requirements to ensure that
program participants comply with this subdivision.
new text end

new text begin Subd. 7. new text end

new text begin Reports. new text end

new text begin By January 15 and July 15 each year, NeighborWorks Home Partners
must report to the chairs and ranking minority members of the legislative committees having
jurisdiction over housing the following information:
new text end

new text begin (1) the number and amount of grants issued;
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new text begin (2) the median grant amount;
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new text begin (3) the number and amount of grants issued by race or ethnic categories;
new text end

new text begin (4) the median home purchase price;
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new text begin (5) the total amount returned to the fund; and
new text end

new text begin (6) the number and amount of grants issued by county.
new text end