SF 3163

as introduced - 80th Legislature (1997 - 1998) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act
  1.2             relating to taxation; property; clarifying the rules 
  1.3             applicable to the low-income housing class; changing 
  1.4             penalties; providing for deposit of fees and penalties 
  1.5             in the housing development fund; amending Minnesota 
  1.6             Statutes 1997 Supplement, sections 273.126, 
  1.7             subdivision 3; and 462A.071, subdivisions 2, 4, and 8. 
  1.8   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.9      Section 1.  Minnesota Statutes 1997 Supplement, section 
  1.10  273.126, subdivision 3, is amended to read: 
  1.11     Subd. 3.  [RENT RESTRICTIONS.] (a) In order to qualify 
  1.12  under class 4d, a unit must be subject to a rent restriction 
  1.13  agreement with the housing finance agency for a period of at 
  1.14  least five years.  The agreement must be in effect and apply to 
  1.15  the rents to be charged for the year in which the property taxes 
  1.16  are payable.  The agreement must provide that the restrictions 
  1.17  apply to each year of the period, regardless of whether the unit 
  1.18  is occupied by an individual with qualifying income or whether 
  1.19  class 4d applies.  The rent restriction agreement must provide 
  1.20  for rents for the unit to be no higher than 30 percent of 60 
  1.21  percent of the median gross income.  The definition of median 
  1.22  gross income specified in this section applies.  "Rent" means 
  1.23  "gross rent" as defined in section 42(g)(2)(B) of the Internal 
  1.24  Revenue Code of 1986, as amended through December 31, 1996.  
  1.25     (b) Notwithstanding the maximum rent levels permitted, 20 
  1.26  percent of the units in the metropolitan area and ten percent of 
  2.1   the units in greater Minnesota qualifying under class 4d must be 
  2.2   made available to a family with a section 8 certificate or 
  2.3   voucher. 
  2.4      (c) The rent restriction agreement runs with the land and 
  2.5   binds any successor to title to the property, without regard to 
  2.6   whether the successor had actual notice or knowledge of the 
  2.7   agreement.  The owner must promptly record the agreement in the 
  2.8   office of the county recorder or must file it in the office of 
  2.9   the registrar of titles, in the county where the property is 
  2.10  located.  If the agreement is not recorded, class 4d does not 
  2.11  apply to the property. 
  2.12     Sec. 2.  Minnesota Statutes 1997 Supplement, section 
  2.13  462A.071, subdivision 2, is amended to read: 
  2.14     Subd. 2.  [APPLICATION.] (a) In order to qualify for 
  2.15  certification under subdivision 1, the owner or manager of the 
  2.16  property must annually apply to the agency.  The application 
  2.17  must be in the form prescribed by the agency, contain the 
  2.18  information required by the agency, and be submitted by the date 
  2.19  and time specified by the agency. 
  2.20     (b) Each application must include: 
  2.21     (1) the property tax identification number; 
  2.22     (2) the number, type, and size of units the applicant seeks 
  2.23  to qualify as low-income housing under class 4d; 
  2.24     (3) the number, type, and size of units in the property for 
  2.25  which the applicant is not seeking qualification, if any; 
  2.26     (4) a certification that the property has been inspected by 
  2.27  a qualified inspector within the past three years and meets the 
  2.28  minimum housing quality standards or is exempt from the 
  2.29  inspection requirement under subdivision 4; 
  2.30     (5) a statement indicating the building is qualifying units 
  2.31  in compliance with the income limits; 
  2.32     (6) an executed agreement to restrict rents meeting the 
  2.33  requirements specified by the agency or executed leases for the 
  2.34  units for which qualification as low-income housing as class 4d 
  2.35  under section 273.13 is sought and the rent schedule; and 
  2.36     (7) any additional information the agency deems appropriate 
  3.1   to require. 
  3.2      (c) The applicant must pay a per-unit application fee to be 
  3.3   set by the agency.  The application fee charged by the agency 
  3.4   must approximately equal the costs of processing and reviewing 
  3.5   the applications.  The fee must be deposited in the general 
  3.6   housing development fund. 
  3.7      Sec. 3.  Minnesota Statutes 1997 Supplement, section 
  3.8   462A.071, subdivision 4, is amended to read: 
  3.9      Subd. 4.  [MINIMUM HOUSING QUALITY STANDARDS.] (a) To 
  3.10  qualify for taxation under class 4d under section 273.13, a unit 
  3.11  must meet both the housing maintenance code of the local unit of 
  3.12  government in which the unit is located, if such a code has been 
  3.13  adopted, and or the housing quality standards adopted by the 
  3.14  United States Department of Housing and Urban Development, if no 
  3.15  local housing maintenance code has been adopted. 
  3.16     (b) In order to meet the minimum housing quality standards, 
  3.17  a building must be inspected by an independent designated 
  3.18  inspector at least once every three years.  The inspector must 
  3.19  certify that the building complies with the minimum standards.  
  3.20  The property owner must pay the cost of the inspection. 
  3.21     (c) The agency may exempt from the inspection requirement 
  3.22  housing units that are financed by a governmental entity and 
  3.23  subject to regular inspection or other compliance checks with 
  3.24  regard to minimum housing quality.  Written certification must 
  3.25  be supplied to show that these exempt units have been inspected 
  3.26  within the last three years and comply with the requirements 
  3.27  under the public financing or local requirements. 
  3.28     Sec. 4.  Minnesota Statutes 1997 Supplement, section 
  3.29  462A.071, subdivision 8, is amended to read: 
  3.30     Subd. 8.  [PENALTIES.] (a) The penalties provided by this 
  3.31  subdivision apply to each unit that received class 4d taxation 
  3.32  for a year and failed to meet the requirements of section 
  3.33  273.126 and this section. 
  3.34     (b) If the owner or manager does not comply with the rent 
  3.35  restriction agreement, or does not comply with the income 
  3.36  restrictions or, minimum housing quality standards, or the 
  4.1   section 8 availability requirements, a penalty applies equal to 
  4.2   the increased taxes that would have been imposed if the property 
  4.3   unit had not been classified under class 4d for the year in 
  4.4   which restrictions were violated, plus an additional amount 
  4.5   equal to ten percent of the increased taxes.  The provisions of 
  4.6   section 279.03 apply to the amount of increased taxes that would 
  4.7   have been imposed if a unit had not been classified under class 
  4.8   4d for the year in which restrictions were violated. 
  4.9      (c) If the agency finds that the violations were 
  4.10  inadvertent and insubstantial, a penalty of $50 per unit per 
  4.11  year applies in lieu of the penalty specified under paragraph 
  4.12  (b).  In order to qualify under this paragraph, violations of 
  4.13  the minimum housing quality standards must be corrected within a 
  4.14  reasonable period of time and rent charged in excess of the 
  4.15  agreement must be rebated to the tenants. 
  4.16     (d) The agency may abate the penalties under this 
  4.17  subdivision for reasonable cause. 
  4.18     (e) Penalties assessed under paragraph (c) are payable to 
  4.19  the agency and must be deposited in the general housing 
  4.20  development fund.  If an owner or manager fails to timely pay a 
  4.21  penalty imposed under paragraph (c), the agency may choose to: 
  4.22     (1) impose the penalty under paragraph (b); or 
  4.23     (2) certify the penalty under paragraph (c) to the auditor 
  4.24  for collection as additional taxes. 
  4.25  The agency shall certify to the county auditor penalties 
  4.26  assessed under paragraph (b) and clause (2).  The auditor shall 
  4.27  impose and collect the certified penalties as additional taxes 
  4.28  which will be distributed to taxing districts in the same manner 
  4.29  as property taxes on the property. 
  4.30     Sec. 5.  [EFFECTIVE DATE.] 
  4.31     Sections 1 to 4 are effective beginning for property taxes 
  4.32  assessed in 1998 and payable in 1999.