HF 4468

as introduced - 90th Legislature (2017 - 2018) Posted on 04/26/2018 09:36am

A bill for an act
relating to taxation; creating a Minneapolis Housing Restoration Tax Increment
Financing District.

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

Section 1. new text begin CITY OF MINNEAPOLIS; HOUSING RESTORATION TAX
INCREMENT FINANCING DISTRICT.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) "City" means the city of Minneapolis.
new text end

new text begin (b) "Housing Restoration Tax Increment Financing District" or "district" means an area
located in a municipal development district that consists of four noncontiguous parcels on
which the city anticipates future development.
new text end

new text begin (c) "Eligible housing trust" means an entity that (1) is owned or operated by the city or
by a nonprofit corporation that is a qualified charitable organization under section 501(c)(3)
of the Internal Revenue Code of 1986, as amended, and (2) has five years of experience in
the construction of new single-family homes or in the rehabilitation of rental property and
rental property management.
new text end

new text begin (d) "Substandard" means a parcel (1) is a vacant site, (2) contains a vacant house that is
not compliant with the State Building Code, or (3) contains a rental house that is structurally
substandard, as defined in Minnesota Statutes, section 469.174, subdivision 10.
new text end

new text begin Subd. 2. new text end

new text begin Establishment of tax increment financing district. new text end

new text begin The city may create a
Housing Restoration Tax Increment Financing District. To establish the district, the city
shall adopt a housing restoration tax increment plan and otherwise comply with the
requirements of Minnesota Statutes, section 469.175, except that the determinations required
in Minnesota Statutes, section 469.175, subdivision 3, paragraph (b), clauses (1) and (2),
are not required.
new text end

new text begin Subd. 3. new text end

new text begin Application of tax increment law. new text end

new text begin Minnesota Statutes, sections 469.174 to
469.179, apply to the administration of the district, except as otherwise provided in this
section. The use for which tax increment may be expended is as provided in subdivision 6.
Minnesota Statutes, sections 469.1761 and 469.1763, do not apply.
new text end

new text begin Subd. 4. new text end

new text begin Duration limitation. new text end

new text begin No tax increment generated by the district shall be paid
to the city after the expiration of 15 years from the receipt of certificate of occupancy of a
new building on a parcel located in the district.
new text end

new text begin Subd. 5. new text end

new text begin Limitations on use of increment. new text end

new text begin (a) A maximum of 75 percent of increment
received by the city from the district may be used in accordance with the Housing Restoration
Tax Increment Financing District. The remainder of the tax increment derived from the
district shall be distributed to the jurisdictions according to provisions of current law.
new text end

new text begin (b) Allowable administrative expenses under subdivision 3 and Minnesota Statutes,
section 469.176, are the responsibility of the city.
new text end

new text begin Subd. 6. new text end

new text begin Permitted uses of increment. new text end

new text begin (a) Only eligible housing trusts may undertake
activities permitted by this act.
new text end

new text begin (b) Eligible housing trusts may (1) contract for construction and sale of new family
homes on parcels containing no houses or vacant houses, and (2) purchase single-family
substandard vacant houses or substandard rental properties for the purpose of rehabilitation.
Rental properties may be rented or sold by the trust as provided in paragraph (c).
new text end

new text begin (c) An eligible trust may provide second mortgage financing to buyers. Such financing
will be fully forgivable provided the buyer occupies the home for a minimum of ten years.
Rents on the rehabilitated rental property shall equal the pre-rehabilitation rent for a minimum
period of three years.
new text end

new text begin (d) An eligible trust may accept donations or matching grants from foundations, trusts,
or philanthropic entities for the purposes under paragraph (c).
new text end

new text begin Subd. 7. new text end

new text begin Applicability of other laws. new text end

new text begin References in Minnesota Statutes to tax increment
financing districts created and tax increment generated under Minnesota Statutes, sections
469.174 to 469.179, include the Housing Restoration Tax Increment Financing District and
tax increment subject to this section.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective upon compliance by the city of
Minneapolis with Minnesota Statutes, section 645.021.
new text end