SF 3994

1st Engrossment - 92nd Legislature (2021 - 2022) Posted on 04/01/2022 01:47pm

A bill for an act
relating to housing; appropriating money for the Minnesota Housing Finance
Agency supplemental budget; amending Minnesota Statutes 2020, sections
462A.03, subdivision 13; 462A.05, by adding subdivisions; 462A.07, subdivisions
9, 10, 14; 462A.2035, by adding a subdivision; 462A.204, subdivision 3; 462A.21,
subdivision 4a; 462A.24; 462A.33, by adding a subdivision; 462A.36, subdivision
4, by adding a subdivision; 462A.37, subdivision 4, by adding a subdivision;
462A.38, subdivision 1; 462A.39, subdivisions 1, 2, 4, 5, 6, by adding a subdivision;
471.9996, subdivision 1; 474A.061, subdivision 2a; 474A.091, subdivision 3;
Minnesota Statutes 2021 Supplement, sections 462A.05, subdivision 14a; 462A.37,
subdivision 5; Laws 2021, First Special Session chapter 8, article 6, section 1,
subdivision 7; proposing coding for new law in Minnesota Statutes, chapters 12;
462; 462A; repealing Minnesota Statutes 2020, section 471.9996, subdivision 2.

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

ARTICLE 1

HOUSING APPROPRIATIONS

Section 1. new text begin APPROPRIATIONS. new text end

new text begin The sums shown in the columns marked "Appropriations" are added to the appropriations
in Laws 2021, First Special Session chapter 8, or other law, to specified agencies. The
appropriations are from the general fund, or another named fund, and are available for the
fiscal years indicated for each purpose. The figures "2022" and "2023" used in this article
mean that the appropriations listed under them are available for the fiscal year ending June
30, 2022, or June 30, 2023, respectively.
new text end

			new text begin APPROPRIATIONS new text end
			new text begin Available for the Year new text end
			new text begin Ending June 30 new text end
				new text begin 2022 new text end		new text begin 2023 new text end

Sec. 2. new text begin HOUSING FINANCE AGENCY new text end

new text begin Subdivision 1. new text end new text begin Total Appropriation new text end

new text begin $ new text end

new text begin 50,000,000 new text end

new text begin (a) The amounts that may be spent for each
purpose are specified in the following
subdivisions.
new text end

new text begin (b) Unless otherwise specified, this
appropriation is for transfer to the housing
development fund for the programs specified
in this section.
new text end

new text begin Subd. 2. new text end new text begin Workforce Homeownership Program new text end

new text begin 10,000,000 new text end

new text begin This appropriation is for the workforce
homeownership program under Minnesota
Statutes, section 462A.38. This is a onetime
appropriation.
new text end

new text begin Subd. 3. new text end new text begin Homeownership Investment Grants new text end

new text begin 35,000,000 new text end

new text begin This appropriation is for homeownership
investment grants under section 4. This is a
onetime appropriation.
new text end

new text begin Subd. 4. new text end new text begin Targeted Loan Pool new text end

new text begin 5,000,000 new text end

new text begin This appropriation is for a grant to Build
Wealth Minnesota to establish the 9,000
Equities Fund, a targeted loan pool, to provide
affordable first mortgages or equivalent
financing opportunities to households
struggling to access mortgages in underserved
communities of color. The goal for this
appropriation for Build Wealth Minnesota and
the 9,000 Equities Fund is to create at least
4,500 new homeownership opportunities and
to close the homeownership disparity gap by
eight percent in the Twin Cities metropolitan
area in five years. By February 15, 2023, and
for the next eight years, Build Wealth
Minnesota shall report to the Minnesota
Housing Finance Agency and the legislature
on activities and expenditures of the 9,000
Equities Fund and its homeownership
outcomes. Up to ten percent of the
appropriation may be used by Build Wealth
Minnesota to administer the target loan pool.
This is a onetime appropriation.
new text end

Sec. 3. new text begin HOUSING AFFORDABILITY FUND; FISCAL YEAR 2023 ALLOCATION.
new text end

new text begin (a) $10,000,000 of the allocations from the Housing Finance Agency's housing
affordability fund, or Pool 3, in fiscal year 2023 shall be for a revolving loan fund under
Minnesota Statutes, section 462A.05, subdivision 35, to provide loans with a two percent
interest rate for residents of manufactured home parks to purchase the manufactured home
park in which they reside for the purpose of conversion of the manufactured home park to
cooperative ownership. Repayments of principal and interest from loans issued under this
section must be used for the purposes of this section. The commissioner must make a
determination regarding the issuance of a loan under this section and disburse the funds
within 90 days of receiving a completed application. No money from the allocation under
this paragraph may be used to administer this program. The commissioner must not supplant
other homeownership programs out of Pool 3 to capitalize this revolving loan fund.
new text end

new text begin (b) $5,000,000 of the allocations from the Housing Finance Agency's housing affordability
fund, or Pool 3, in fiscal year 2023 shall be for grants to nonprofit organizations for the
installation of sprinkler systems in eligible residential buildings. "Eligible residential
buildings" means an existing building owned by a nonprofit organization that has at least
one story used for human occupancy which is 75 feet or more above the lowest level of fire
department vehicle access, and at least two-thirds of its units are rented to an individual or
family with an annual income of up to 50 percent of the area median income as determined
by the United States Department of Housing and Urban Development, adjusted for family
size, that is paying no more than 30 percent of annual income on rent. The agency shall
develop forms and procedures for soliciting and reviewing applications for grants under
this paragraph. The maximum grant per eligible building shall be $250,000, and each grant
must have a nonstate match of at least 25 percent of the grant award. An in-kind contribution
may be used to meet all or a portion of the match requirement. This allocation expires on
June 30, 2025.
new text end

new text begin (c) Each year on January 15, the commissioner of the Housing Finance Agency shall
report to the legislature the allocation of housing affordability funds under paragraphs (a)
and (b) separately, including the amount issued in loans, the amount of loans repaid, the
remaining balance of the revolving loan fund, the number of projects funded or financed,
the number of residents included in each project, and the location of each project.
new text end

new text begin (d) Nothing in this section shall impair the obligation of the agency to use funds in Pool
3 to satisfy the agency's obligations to holders of bonds secured by the general obligation
pledge of the agency to suggested use of agency resources.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 4. new text begin HOMEOWNERSHIP INVESTMENT GRANTS PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin For the purposes of this section, the following terms have
the meanings given:
new text end

new text begin (1) "commissioner" means the commissioner of the Housing Finance Agency; and
new text end

new text begin (2) "eligible organization" means a nonprofit organization the commissioner determines
to be eligible under subdivision 2.
new text end

new text begin Subd. 2. new text end

new text begin Eligible organization. new text end

new text begin To be eligible for a grant under this subdivision, a
nonprofit organization must:
new text end

new text begin (1) be an organization defined under section 501(c)(3) of the Internal Revenue Code or
an equivalent organization;
new text end

new text begin (2) have primary operations located in the state of Minnesota; and
new text end

new text begin (3) be certified as a community development financial institution by the United States
Department of the Treasury and must provide affordable housing lending or financing
programs.
new text end

new text begin Subd. 3. new text end

new text begin Eligible services. new text end

new text begin (a) Eligible organizations may apply for housing investment
grants for affordable owner-occupied housing projects for the following:
new text end

new text begin (1) housing development to increase the supply of affordable owner-occupied homes;
new text end

new text begin (2) financing programs, including revolving loans, for affordable owner-occupied new
home construction;
new text end

new text begin (3) acquisition, rehabilitation, and resale of affordable owner-occupied homes or homes
to be converted to owner-occupied homes;
new text end

new text begin (4) financing programs, including revolving loans, for affordable owner-occupied
manufactured housing;
new text end

new text begin (5) services to increase access to stable, affordable, owner-occupied housing in
low-income communities, Indigenous American Indian communities, and communities of
color; and
new text end

new text begin (6) residential counseling or housing navigation assistance for homeownership.
new text end

new text begin (b) No more than five percent of the total amount awarded in this section may be for
grants under paragraph (a), clause (3), and no more than five percent of the total amount
awarded under this section may be for grants under paragraph (a), clause (6).
new text end

new text begin Subd. 4. new text end

new text begin Commissioner duties. new text end

new text begin (a) The commissioner shall consult with eligible
organizations and develop forms, applications, and reporting requirements for use by eligible
organizations. All organizations applying for a grant must include as part of their application
a plan to create new affordable home ownership and home preservation opportunities for
targeted areas. The commissioner shall develop a grant award scoring system that ensures
a distribution of awards throughout the state based on population and eligible households
and communities.
new text end

new text begin (b) The commissioner shall complete the requirements under paragraph (a) within 90
days of enactment of this section.
new text end

new text begin (c) By January 15, 2023, the commissioner must submit a report to the chairs and ranking
minority members of the legislative committees with jurisdiction over housing finance and
policy detailing the use of funds under this section.
new text end

ARTICLE 2

HOUSING POLICY

Section 1.

new text begin [12.47] LIMITATION OF POWERS; EVICTION PROCEEDINGS.
new text end

new text begin Notwithstanding any law to the contrary, an order issued under this chapter prohibiting
or delaying eviction proceedings under chapter 504B or 327C is valid for a period not to
exceed 30 days. The governor must not extend the order beyond 30 days unless the extension
is approved by a majority vote of each house of the legislature. The governor shall not allow
the order to expire and issue a new order delaying or prohibiting eviction proceedings under
chapter 504B or 327C in an effort to avoid obtaining legislative approval for an extension
of the order as provided in this section. An order issued to avoid obtaining legislative
approval as required under this section is null and void.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 2.

new text begin [462.3575] LIMITING REGULATIONS ON RESIDENTIAL
DEVELOPMENT.
new text end

new text begin Subdivision 1. new text end

new text begin Application. new text end

new text begin This section applies to official controls adopted under
sections 462.357, 462.358, and 462.3595.
new text end

new text begin Subd. 2. new text end

new text begin Planned unit development. new text end

new text begin (a) A municipality shall not require a planned unit
development agreement in lieu of a proposed residential development if the proposed
residential development complies with the existing city zoning ordinances, subdivision
regulation, or qualifies as a conditional use.
new text end

new text begin (b) A planned unit development agreement must be made available to the public by
posting the agreement on the website of the municipality at least seven days before the
governing body's review of the agreement. If the municipality does not have a website, a
copy of the planned unit development agreement must be available for review at the city
hall building of the municipality. If the agreement is approved by the governing body, the
agreement cannot be modified unless all parties to the agreement concur.
new text end

new text begin Subd. 3. new text end

new text begin Limitation on aesthetic mandates. new text end

new text begin A municipality shall not condition approval
of a building permit, subdivision development, or planned unit development on the use of
specific materials, design, or other aesthetic conditions that are not required by the State
Building Code under chapter 326B. This subdivision shall not apply within a historic district
as determined under section 138.72 that was in existence as of January 1, 2022.
new text end

new text begin Subd. 4. new text end

new text begin Exception. new text end

new text begin This section shall not apply to a proposed residential development
that is to be developed by the municipality itself or to multifamily rental, commercial, or
industrial properties.
new text end

Sec. 3.

Minnesota Statutes 2020, section 462A.03, subdivision 13, is amended to read:

Subd. 13.

Eligible mortgagor.

"Eligible mortgagor" means a nonprofit or cooperative
housing corporation; the Department of Administration for the purpose of developing
community-based programs as defined in section 252.50; a limited profit entity or a builder
as defined by the agency in its rules, which sponsors or constructs residential housing as
defined in subdivision 7; or a natural person of low or moderate income, except that the
return to a limited dividend entity shall not exceed 15 percent of the capital contribution of
the investors or such lesser percentage as the agency shall establish in its rules, provided
that residual receipts funds of a limited dividend entity may be used for agency-approved,
housing-related investments owned by the limited dividend entity without regard to the
limitation on returns. Owners of existing residential housing occupied by renters shall be
eligible for rehabilitation loans, only if, as a condition to the issuance of the loan, the owner
agrees to conditions established by the agency in its rules relating to rental or other matters
that will deleted text begin insure deleted text end new text begin ensure new text end that the housing will be occupied by persons and families of low or
moderate income. The agency shall require by rules that the owner give preference to those
persons of low or moderate income who occupied the residential housing at the time of
application for the loan.

Sec. 4.

Minnesota Statutes 2021 Supplement, section 462A.05, subdivision 14a, is amended
to read:

Subd. 14a.

Rehabilitation loans; existing owner-occupied residential housing.

It may
make loans to persons and families of low and moderate income to rehabilitate or to assist
in rehabilitating existing residential housing owned and occupied by those persons or
families. Rehabilitation may include replacement of manufactured homes. No loan shall be
made unless the agency determines that the loan will be used primarily for rehabilitation
work necessary for health or safety, essential accessibility improvements, or to improve the
energy efficiency of the dwelling. No loan for rehabilitation of owner-occupied residential
housing shall be denied solely because the loan will not be used for placing the residential
housing in full compliance with all state, county or municipal building, housing maintenance,
fire, health or similar codes and standards applicable to housing. The amount of any loan
shall not exceed the lesser of (a) a maximum loan amount determined under rules adopted
by the agency not to exceed deleted text begin $37,500 deleted text end new text begin $40,000 new text end , or (b) the actual cost of the work performed,
or (c) that portion of the cost of rehabilitation which the agency determines cannot otherwise
be paid by the person or family without the expenditure of an unreasonable portion of the
income of the person or family. Loans made in whole or in part with federal funds may
exceed the maximum loan amount to the extent necessary to comply with federal lead
abatement requirements prescribed by the funding source. In making loans, the agency shall
determine the circumstances under which and the terms and conditions under which all or
any portion of the loan will be repaid and shall determine the appropriate security for the
repayment of the loan. Loans pursuant to this subdivision may be made with or without
interest or periodic payments.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 5.

Minnesota Statutes 2020, section 462A.05, is amended by adding a subdivision to
read:

new text begin Subd. 14f. new text end

new text begin Reporting; rehabilitation loans. new text end

new text begin By January 15 of each year, the agency
must report to the legislative committees with jurisdiction over housing the following with
respect to the rehabilitation loan programs referenced in subdivisions 14 and 14a:
new text end

new text begin (1) a list of programs, the sources of funding for those programs, and the amounts
allocated from each source;
new text end

new text begin (2) the total number of loans and total amount of outstanding rehabilitation loans per
program;
new text end

new text begin (3) the total number of loans issued, total dollar amount in loans, the mean and median
loan amount, and the number of loans at the maximum loan amount for the prior fiscal year
per program;
new text end

new text begin (4) the total number of loans forgiven, the total dollar amount forgiven, and the mean
and median loan amount forgiven in the prior fiscal year per program;
new text end

new text begin (5) the total amount of loans issued by county over the prior fiscal year per program;
and
new text end

new text begin (6) a history of the maximum loan amount over time and computation of what the
maximum loan amount would be if adjusted for inflation.
new text end

Sec. 6.

Minnesota Statutes 2020, section 462A.05, is amended by adding a subdivision to
read:

new text begin Subd. 42. new text end

new text begin Indian Tribes. new text end

new text begin Notwithstanding any other provision in this chapter, at its
discretion the agency may make any federally recognized Indian Tribe in Minnesota, or
their associated Tribally Designated Housing Entity (TDHE) as defined by United States
Code, title 25, section 4103(22), eligible for funding authorized under this chapter.
new text end

Sec. 7.

Minnesota Statutes 2020, section 462A.05, is amended by adding a subdivision to
read:

new text begin Subd. 43. new text end

new text begin Housing disparities. new text end

new text begin The agency must prioritize its use of appropriations for
any homeownership program under this chapter to narrow the racial disparity gap in
homeownership.
new text end

Sec. 8.

Minnesota Statutes 2020, section 462A.07, subdivision 9, is amended to read:

Subd. 9.

Priority where State Building Code is adopted.

It may establish such rules
as may be necessary to deleted text begin insure deleted text end new text begin ensure new text end that priority for assistance by the agency will be given
to projects located in municipal jurisdictions or counties, which have adopted the uniform
State Building Code.

Sec. 9.

Minnesota Statutes 2020, section 462A.07, subdivision 10, is amended to read:

Subd. 10.

Human rights.

It may establish and enforce such rules as may be necessary
to deleted text begin insure deleted text end new text begin ensure new text end compliance with chapter 363A, and to deleted text begin insure deleted text end new text begin ensure new text end that occupancy of
housing assisted under this chapter shall be open to all persons, and that contractors and
subcontractors engaged in the construction of such housing shall provide an equal opportunity
for employment to all persons, without discrimination as to race, color, creed, religion,
national origin, sex, marital status, age, and status with regard to public assistance or
disability.

Sec. 10.

Minnesota Statutes 2020, section 462A.07, subdivision 14, is amended to read:

Subd. 14.

American Indians.

(a) It may engage in housing programs for low- and
moderate-income American Indians developed and administered separately or in combination
by the Minnesota Chippewa tribe, the Red Lake band of Chippewa Indians, and the Sioux
communities as determined by such tribe, band, or communities. In furtherance of the policy
of economic integration stated in section 462A.02, subdivision 6, it may engage in housing
programs for American Indians who intend to reside on reservations and who are not persons
of low and moderate income, provided that the aggregate dollar amount of the loans for
persons who are not of low- or moderate-income closed in each lender's fiscal year shall
not exceed an amount equal to 25 percent of the total dollar amount of all loans closed by
that lender during the same fiscal year. In developing such housing programs, the tribe,
band, or communities shall take into account the housing needs of all American Indians
residing both on and off reservations within the state. A plan for each such program, which
specifically describes the program content, utilization of funds, administration, operation,
implementation and other matter, as determined by the agency, must be submitted to the
agency for its review and approval prior to the making of eligible loans pursuant to section
462A.21. All such programs must conform to rules promulgated by the agency concerning
program administration, including but not limited to rules concerning costs of administration;
the quality of housing; interest rates, fees, and charges in connection with making eligible
loans; and other matters determined by the agency to be necessary in order to effectuate the
purposes of this subdivision and section 462A.21, subdivisions 4b and 4c. All such programs
must provide for a reasonable balance in the distribution of funds appropriated for the
purpose of this section between American Indians residing on and off reservations within
the state. Nothing in this section shall preclude such tribe, band, or communities from
requesting and receiving cooperation, advice, and assistance from the agency as regards
program development, operation, delivery, financing, or administration. As a condition to
the making of such eligible loans, the Minnesota Chippewa tribe, the Red Lake band of
Chippewa Indians, and the Sioux communities shall:

(1) enter into a loan agreement and other contractual arrangements with the agency for
the purpose of transferring the allocated portion of loan funds and to deleted text begin insure deleted text end new text begin ensure new text end compliance
with the provisions of this section and this chapter; and

(2) agree that all of their official books and records related to such housing programs
shall be subjected to audit by the legislative auditor in the manner prescribed for agencies
of state government.

The agency shall submit a biennial report concerning the various housing programs for
American Indians, and related receipts and expenditures as provided in section 462A.22,
subdivision 9, and such tribe, band, or communities to the extent that they administer such
programs, shall be responsible for any costs and expenses related to such administration
provided, however, they shall be eligible for payment for costs, expenses, and services
pursuant to subdivision 12 and section 462A.21. The agency may provide or cause to be
provided essential general technical services as set forth in subdivision 2, and general
consultative project assistance services, including, but not limited to, management training,
and home ownership counseling as set forth in subdivision 3. Members of boards,
committees, or other governing bodies of the tribe, band, and communities administering
the programs authorized by this subdivision must be compensated for those services as
provided in section 15.0575.

(b) The agency may engage in demonstration projects to encourage the participation of
financial institutions or other leveraging sources in providing housing opportunities for
American Indians. The agency shall consult with the Minnesota Chippewa tribe, the Red
Lake band of Chippewa Indians, and the Sioux communities in developing the demonstration
projects. The income limits specified in paragraph (a) do not apply to the demonstration
projects.

(c) The agency may make home improvement loans under this subdivision without
regard to household income.

Sec. 11.

Minnesota Statutes 2020, section 462A.2035, is amended by adding a subdivision
to read:

new text begin Subd. 5. new text end

new text begin Report. new text end

new text begin By January 15 of each year, the agency must report to the legislative
committees with jurisdiction over housing the following with respect to grants issued under
subdivision 1b:
new text end

new text begin (1) grants requested and grants funded during the prior fiscal year, organized by
ownership type of the manufactured home park, such as private, cooperative, and municipal
ownership, and by county; and
new text end

new text begin (2) the average amounts of grants awarded.
new text end

Sec. 12.

Minnesota Statutes 2020, section 462A.204, subdivision 3, is amended to read:

Subd. 3.

Set aside.

At least one grant must be awarded in an area located outside of the
metropolitan area. A county, a group of contiguous counties jointly acting together, a Tribe,
a group of Tribes, or a community-based nonprofit organization deleted text begin with a sponsoring resolution
from each of the county boards of the counties located within its operating jurisdiction deleted text end may
apply for and receive grants deleted text begin for areas located outside the metropolitan area deleted text end .

Sec. 13.

Minnesota Statutes 2020, section 462A.21, subdivision 4a, is amended to read:

Subd. 4a.

Correction of housing defects.

It may make rehabilitation grants and
expenditures for correction of residential housing defects as provided in section 462A.05,
subdivisions 15 and 16. In order to deleted text begin insure deleted text end new text begin ensure new text end the preservation of the maximum number
of housing units with the money appropriated by the legislature, grants shall be recovered
by the agency to the extent provided in this section to be used for future grants. Grants made
under the terms of this subdivision shall contain a requirement that the grant be recovered
by the agency in accordance with the following schedule:

(1) if the property is sold, transferred, or otherwise conveyed within the first three years
after the date of a grant, the recipient shall repay the full amount of the grant;

(2) if the property is sold, transferred, or otherwise conveyed within the fourth year after
the date of a grant, the recipient shall repay 75 percent of the amount of the grant;

(3) if the property is sold, transferred, or otherwise conveyed within the fifth year after
the date of a grant, the recipient shall repay 50 percent of the amount of the grant;

(4) if the property is sold, transferred, or otherwise conveyed within the sixth year after
the date of a grant, the recipient shall repay 25 percent of the amount of the grant;

(5) if the property is sold, transferred, or otherwise conveyed within the seventh year
after the date of the grant, or thereafter, there is no repayment requirement; provided that
no repayment is required to the extent that the grants are made to improve the accessibility
of residential housing to a disabled occupant.

Sec. 14.

Minnesota Statutes 2020, section 462A.24, is amended to read:

462A.24 CONSTRUCTION; GRANTS AND LOANS; PRIORITIES.

(a) This chapter is necessary for the welfare of the state of Minnesota and its inhabitants;
therefore, it shall be liberally construed to effect its purpose.

(b) To the extent practicable, the agency shall award grant and loan amounts with a
reasonable balance between nonmetropolitan and metropolitan areas of the state.

(c) Beginning with applications made in response to requests for proposals issued after
July 1, 2020, after final decisions are made on applications for programs of the agency, the
results of any quantitative scoring system used to rank applications shall be posted on the
agency website.

new text begin (d) The agency shall award points in the agency's decision-making criteria for all
programs of the agency based on how quickly a project can be constructed.
new text end

Sec. 15.

Minnesota Statutes 2020, section 462A.33, is amended by adding a subdivision
to read:

new text begin Subd. 9. new text end

new text begin Report. new text end

new text begin By January 15 of each year, the agency must report to the legislative
committees with jurisdiction over housing the following with respect to activities of the
program created by this section during the prior fiscal year:
new text end

new text begin (1) the number of units of new construction and number of rehabilitated units funded
by county; and
new text end

new text begin (2) the number of owner-occupied units and number of rental units funded by county.
new text end

Sec. 16.

Minnesota Statutes 2020, section 462A.36, is amended by adding a subdivision
to read:

new text begin Subd. 2a. new text end

new text begin Refunding bonds. new text end

new text begin (a) The agency may issue nonprofit housing bonds in one
or more series to refund bonds authorized in subdivision 2. The amount of refunding nonprofit
housing bonds that may be issued from time to time will not be subject to the dollar limitation
contained in subdivision 2 nor will those bonds be included in computing the amount of
bonds that may be issued within that dollar limitation.
new text end

new text begin (b) In the refunding of nonprofit housing bonds, each bond must be called for redemption
prior to its maturity in accordance with its terms no later than the earliest date on which it
may be redeemed. No refunding bonds may be issued unless as of the date of the refunding
bonds the present value of the dollar amount of the debt service on the refunding bonds,
computed to their stated maturity dates, is lower than the present value of the dollar amount
of debt service on all nonprofit housing bonds refunded computed to their stated maturity
dates. For purposes of this subdivision, "present value of the dollar amount of debt service"
means the dollar amount of debt service to be paid, discounted to the nominal date of the
refunding bonds at a rate equal to the yield on the refunding bonds.
new text end

new text begin (c) If as a result of the issuance of refunding bonds the amount of debt service for an
annual period is less than the amount transferred by the commissioner of management and
budget to pay debt service for that annual period, the agency must deduct the excess amount
from the actual amount of debt service on those bonds certified for the next subsequent
annual period.
new text end

Sec. 17.

Minnesota Statutes 2020, section 462A.36, subdivision 4, is amended to read:

Subd. 4.

Appropriation; payment to agency or trustee.

(a) The agency must certify
annually to the commissioner of management and budget the actual amount of annual debt
service on each series of bonds issued under subdivision 2.

(b) Each July 15, beginning in 2009 and through 2031, if any nonprofit housing bonds
issued under subdivision 2 new text begin , or nonprofit housing bonds issued to refund those bonds, new text end remain
outstanding, the commissioner of management and budget must transfer to the nonprofit
housing bond account established under section 462A.21, subdivision 32, the amount
certified under paragraph (a), not to exceed $2,400,000 annually. The amounts necessary
to make the transfers are appropriated from the general fund to the commissioner of
management and budget.

(c) The agency may pledge to the payment of the nonprofit housing bonds the payments
to be made by the state under this section.

Sec. 18.

Minnesota Statutes 2020, section 462A.37, is amended by adding a subdivision
to read:

new text begin Subd. 2i. new text end

new text begin Refunding bonds. new text end

new text begin (a) The agency may issue housing infrastructure bonds in
one or more series to refund bonds authorized in this section. The amount of refunding
housing infrastructure bonds that may be issued from time to time will not be subject to the
dollar limitation contained in any of the authorizations in this section nor will those bonds
be included in computing the amount of bonds that may be issued within those dollar
limitations.
new text end

new text begin (b) In the refunding of housing infrastructure bonds, each bond must be called for
redemption prior to its maturity in accordance with its terms no later than the earliest date
on which it may be redeemed. No refunding bonds may be issued unless as of the date of
the refunding bonds the present value of the dollar amount of the debt service on the
refunding bonds, computed to their stated maturity dates, is lower than the present value of
the dollar amount of debt service on all housing infrastructure bonds refunded computed to
their stated maturity dates. For purposes of this subdivision, "present value of the dollar
amount of debt service" means the dollar amount of debt service to be paid, discounted to
the nominal date of the refunding bonds at a rate equal to the yield on the refunding bonds.
new text end

new text begin (c) If as a result of the issuance of refunding bonds the amount of debt service for an
annual period is less than the amount transferred by the commissioner of management and
budget to pay debt service for that annual period, the agency must deduct the excess amount
from the actual amount of debt service on those bonds certified for the next subsequent
annual period.
new text end

Sec. 19.

Minnesota Statutes 2020, section 462A.37, subdivision 4, is amended to read:

Subd. 4.

Appropriation; payment to agency or trustee.

(a) The agency must certify
annually to the commissioner of management and budget the actual amount of annual debt
service on each series of bonds issued under subdivision 2.

(b) Each July 15, beginning in 2013 and through 2035, if any housing infrastructure
bonds issued under subdivision 2 new text begin , or housing infrastructure bonds issued to refund those
bonds, new text end remain outstanding, the commissioner of management and budget must transfer to
the deleted text begin affordable deleted text end housing new text begin infrastructure new text end bond account established under section 462A.21,
subdivision 33, the amount certified under paragraph (a), not to exceed $2,200,000 annually.
The amounts necessary to make the transfers are appropriated from the general fund to the
commissioner of management and budget.

(c) The agency may pledge to the payment of the housing infrastructure bonds the
payments to be made by the state under this section.

Sec. 20.

Minnesota Statutes 2021 Supplement, section 462A.37, subdivision 5, is amended
to read:

Subd. 5.

Additional appropriation.

(a) The agency must certify annually to the
commissioner of management and budget the actual amount of annual debt service on each
series of bonds issued under this section.

(b) Each July 15, beginning in 2015 and through 2037, if any housing infrastructure
bonds issued under subdivision 2a new text begin , or housing infrastructure bonds issued to refund those
bonds, new text end remain outstanding, the commissioner of management and budget must transfer to
the housing infrastructure bond account established under section 462A.21, subdivision 33,
the amount certified under paragraph (a), not to exceed $6,400,000 annually. The amounts
necessary to make the transfers are appropriated from the general fund to the commissioner
of management and budget.

(c) Each July 15, beginning in 2017 and through 2038, if any housing infrastructure
bonds issued under subdivision 2b new text begin , or housing infrastructure bonds issued to refund those
bonds, new text end remain outstanding, the commissioner of management and budget must transfer to
the housing infrastructure bond account established under section 462A.21, subdivision 33,
the amount certified under paragraph (a), not to exceed $800,000 annually. The amounts
necessary to make the transfers are appropriated from the general fund to the commissioner
of management and budget.

(d) Each July 15, beginning in 2019 and through 2040, if any housing infrastructure
bonds issued under subdivision 2c new text begin , or housing infrastructure bonds issued to refund those
bonds, new text end remain outstanding, the commissioner of management and budget must transfer to
the housing infrastructure bond account established under section 462A.21, subdivision 33,
the amount certified under paragraph (a), not to exceed $2,800,000 annually. The amounts
necessary to make the transfers are appropriated from the general fund to the commissioner
of management and budget.

(e) Each July 15, beginning in 2020 and through 2041, if any housing infrastructure
bonds issued under subdivision 2d new text begin , or housing infrastructure bonds issued to refund those
bonds, new text end remain outstanding, the commissioner of management and budget must transfer to
the housing infrastructure bond account established under section 462A.21, subdivision 33,
the amount certified under paragraph (a). The amounts necessary to make the transfers are
appropriated from the general fund to the commissioner of management and budget.

(f) Each July 15, beginning in 2020 and through 2041, if any housing infrastructure
bonds issued under subdivision 2e new text begin , or housing infrastructure bonds issued to refund those
bonds, new text end remain outstanding, the commissioner of management and budget must transfer to
the housing infrastructure bond account established under section 462A.21, subdivision 33,
the amount certified under paragraph (a). The amounts necessary to make the transfers are
appropriated from the general fund to the commissioner of management and budget.

(g) Each July 15, beginning in 2022 and through 2043, if any housing infrastructure
bonds issued under subdivision 2f new text begin , or housing infrastructure bonds issued to refund those
bonds, new text end remain outstanding, the commissioner of management and budget must transfer to
the housing infrastructure bond account established under section 462A.21, subdivision 33,
the amount certified under paragraph (a). The amounts necessary to make the transfers are
appropriated from the general fund to the commissioner of management and budget.

(h) Each July 15, beginning in 2022 and through 2043, if any housing infrastructure
bonds issued under subdivision 2g new text begin , or housing infrastructure bonds issued to refund those
bonds, new text end remain outstanding, the commissioner of management and budget must transfer to
the housing infrastructure bond account established under section 462A.21, subdivision 33,
the amount certified under paragraph (a). The amounts necessary to make the transfers are
appropriated from the general fund to the commissioner of management and budget.

(i) Each July 15, beginning in 2023 and through 2044, if any housing infrastructure
bonds issued under subdivision 2h new text begin , or housing infrastructure bonds issued to refund those
bonds, new text end remain outstanding, the commissioner of management and budget must transfer to
the housing infrastructure bond account established under section 462A.21, subdivision 33,
the amount certified under paragraph (a). The amounts necessary to make the transfers are
appropriated from the general fund to the commissioner of management and budget.

(j) The agency may pledge to the payment of the housing infrastructure bonds the
payments to be made by the state under this section.

Sec. 21.

Minnesota Statutes 2020, section 462A.38, subdivision 1, is amended to read:

Subdivision 1.

Establishment.

A workforce and affordable homeownership development
program is established to award homeownership development grants to cities, new text begin counties,
new text end Tribal governments, nonprofit organizations, cooperatives created under chapter 308A or
308B, and community land trusts created for the purposes outlined in section 462A.31,
subdivision 1, for development of workforce and affordable homeownership projects. The
purpose of the program is to increase the supply of workforce and affordable, owner-occupied
multifamily or single-family housing throughout Minnesota.

Sec. 22.

Minnesota Statutes 2020, section 462A.39, subdivision 1, is amended to read:

Subdivision 1.

Establishment.

The commissioner of Minnesota housing finance shall
establish a workforce housing development program to award grants or deferred loans to
eligible project areas to be used for qualified expenditures. Grants or deferred loans
authorized under this section may be made without limitations relating to the maximum
incomes of the renters new text begin or homeowners new text end .

Sec. 23.

Minnesota Statutes 2020, section 462A.39, subdivision 2, is amended to read:

Subd. 2.

Definitions.

(a) For purposes of this section, the following terms have the
meanings given.

(b) "Eligible project area" means a home rule charter or statutory city located outside
of the metropolitan area as defined in section 473.121, subdivision 2, with a population
exceeding 500; a community that has a combined population of 1,500 residents located
within 15 miles of a home rule charter or statutory city located outside the metropolitan
area as defined in section 473.121, subdivision 2; new text begin federally recognized Tribal Reservations;
new text end or an area served by a joint county-city economic development authority.

(c) "Joint county-city economic development authority" means an economic development
authority formed under Laws 1988, chapter 516, section 1, as a joint partnership between
a city and county and excluding those established by the county only.

(d) "Market rate residential rental properties" means properties that are rented at market
value, including new modular homes, new manufactured homes, and new manufactured
homes on leased land or in a manufactured home park, and may include rental developments
that have a portion of income-restricted units.

(e) "Qualified expenditure" means expenditures for new text begin owner-occupied housing or new text end market
rate residential rental properties including acquisition of property; construction of
improvements; and provisions of loans or subsidies, grants, interest rate subsidies, public
infrastructure, and related financing costs.

Sec. 24.

Minnesota Statutes 2020, section 462A.39, subdivision 4, is amended to read:

Subd. 4.

Program requirements.

(a) The commissioner must not award a grant or
deferred loans to an eligible project area under this section until the following determinations
are made:

(1) the average vacancy rate for rental housing located in the eligible project area, and
in any other city located within 15 miles or less of the boundaries of the area, has been five
percent or less for at least the prior two-year period;

(2) one or more businesses located in the eligible project area, or within 25 miles of the
area, that employs a minimum of 20 full-time equivalent employees in aggregate have
provided a written statement to the eligible project area indicating that the lack of available
deleted text begin rental deleted text end housing has impeded their ability to recruit and hire employees; and

(3) the eligible project area has certified that the grants or deferred loans will be used
for qualified expenditures for the development of deleted text begin rental deleted text end housing to serve employees of
businesses located in the eligible project area or surrounding area.

(b) Preference for grants or deferred loans awarded under this section shall be given to
eligible project areas with less than 30,000 people.

(c) Among comparable proposals, preference must be given to projects with a higher
proportion of units that are not income-restricted.

Sec. 25.

Minnesota Statutes 2020, section 462A.39, subdivision 5, is amended to read:

Subd. 5.

Allocation.

The amount of a grant or deferred loans may not exceed 25 percent
of the rental housing development project cost. The commissioner shall not award a grant
or deferred loans to deleted text begin a city deleted text end new text begin an eligible project area new text end without certification by the deleted text begin city deleted text end new text begin eligible
project area new text end that the amount of the grant or deferred loans shall be matched by a local unit
of government, business, deleted text begin or deleted text end nonprofit organization new text begin , or federally recognized Tribe, new text end with $1
for every $2 provided in grant or deferred loans funds.

Sec. 26.

Minnesota Statutes 2020, section 462A.39, is amended by adding a subdivision
to read:

new text begin Subd. 5a. new text end

new text begin No change in project scope. new text end

new text begin (a) When a contingency is provided in a grant
award under this section, changes to the project made by the developer to meet the
contingency shall not be considered a change in project scope and the grant must be funded,
provided that:
new text end

new text begin (1) the number of affordable units is not reduced;
new text end

new text begin (2) an increase in the number of affordable units is allowed if required to cover the
increased financial costs of meeting the agency contingency; and
new text end

new text begin (3) additional state funds are not solicited for the project.
new text end

new text begin (b) Additional local matching funds may be solicited for the project under this
subdivision, including but not limited to funds from local units of government.
new text end

Sec. 27.

Minnesota Statutes 2020, section 462A.39, subdivision 6, is amended to read:

Subd. 6.

Report.

deleted text begin Beginning deleted text end new text begin By new text end January 15 deleted text begin , 2018 deleted text end new text begin of each year new text end , the commissioner must
annually submit a report to the chairs and ranking minority members of the senate and house
of representatives committees having jurisdiction over taxes deleted text begin and deleted text end new text begin , new text end workforce development new text begin ,
and housing new text end specifying the projects that received grants or deferred loans under this section
and the specific purposes for which the grant funds were used. new text begin The report must include a
breakdown of the amount issued in loans and the amount issued in grants for the prior fiscal
year, together with the number of new units funded and the number of rehabilitated units
funded in the prior fiscal year.
new text end

Sec. 28.

new text begin [462A.41] PROGRAM FOR MANUFACTURED HOME MORTGAGE
FINANCING AND DOWN PAYMENT ASSISTANCE FOR CERTAIN
MANUFACTURED HOMES.
new text end

new text begin (a) By August 1, 2023, the agency, in conjunction with Fannie Mae's HomeReady
program or other federal mortgage programs that may authorize it, must develop and
implement a program that offers mortgage financing and down payment assistance for
purchasers of eligible manufactured homes.
new text end

new text begin (b) For purposes of this section "eligible manufactured homes" means a manufactured
home titled as real property in this state and affixed to real property owned by a
resident-owned community.
new text end

new text begin (c) The agency may include manufactured homes in private parks as an eligible
manufactured home if allowed under federal law. The commissioner must report to the
chairs and ranking minority members of the legislative committees with jurisdiction over
housing by August 1, 2023, on steps required to set up a similar program for manufactured
homes in private parks if they do not qualify under federal law.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 29.

Minnesota Statutes 2020, section 471.9996, subdivision 1, is amended to read:

Subdivision 1.

deleted text begin In general deleted text end new text begin Prohibition new text end .

new text begin (a) new text end No statutory or home rule charter city, county,
or town may adopt or renew by ordinance or otherwise any law to control rents on private
residential property deleted text begin except as provided in subdivision 2 deleted text end . This section does not impair the
right of any statutory or home rule charter city, county, or town:

(1) to manage or control property in which it has a financial interest through a housing
authority or similar agency;

(2) to contract with a property owner;

(3) to act as required or authorized by laws or regulations of the United States government
or this state; or

(4) to mediate between property owners and tenants for the purpose of negotiating rents.

new text begin (b) Nothing in this section shall be deemed to limit or restrict the classification of
low-income rental property as class 4d under section 273.13, subdivision 25.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively from November 1, 2021.
new text end

Sec. 30.

Minnesota Statutes 2020, section 474A.061, subdivision 2a, is amended to read:

Subd. 2a.

Housing pool allocation.

(a) Commencing on the second Tuesday in January
and continuing on each Monday through the last Monday in June, the commissioner shall
allocate available bonding authority from the housing pool to applications received on or
before the Monday of the preceding week for residential rental projects that meet the
eligibility criteria under section 474A.047. Allocations of available bonding authority from
the housing pool for eligible residential rental projects shall be awarded in the following
order of priority:

(1) preservation projects;

(2) 30 percent AMI residential rental projects;

(3) 50 percent AMI residential rental projects;

(4) 100 percent LIHTC projects;

(5) 20 percent LIHTC projects; and

(6) other residential rental projects for which the amount of bonds requested in their
respective applications do not exceed the aggregate bond limitation.

If there are two or more applications for residential rental projects at the same priority level
and there is insufficient bonding authority to provide allocations for all the projects in any
one allocation period, available bonding authority shall be deleted text begin randomly deleted text end awarded by deleted text begin lot deleted text end new text begin giving
preference for projects with a lower cost per square foot new text end but only for projects that can receive
the full amount of their respective requested allocations. If a residential rental project does
not receive any of its requested allocation pursuant to this paragraph and the project applies
for an allocation of bonds again in the same calendar year or to the next successive housing
pool, the project shall be fully funded up to its original application request for bonding
authority before any new project, applying in the same allocation period, that has an equal
priority shall receive bonding authority. An issuer that receives an allocation under this
paragraph must issue obligations equal to all or a portion of the allocation received on or
before 180 days of the allocation. If an issuer that receives an allocation under this paragraph
does not issue obligations equal to all or a portion of the allocation received within the time
period provided in this paragraph or returns the allocation to the commissioner, the amount
of the allocation is canceled and returned for reallocation through the housing pool or to
the unified pool after July 1.

(b) After January 1, and through January 15, The Minnesota Housing Finance Agency
may accept applications from cities for single-family housing programs which meet program
requirements as follows:

(1) the housing program must meet a locally identified housing need and be economically
viable;

(2) the adjusted income of home buyers may not exceed 80 percent of the greater of
statewide or area median income as published by the Department of Housing and Urban
Development, adjusted for household size;

(3) house price limits may not exceed the federal price limits established for mortgage
revenue bond programs. Data on the home purchase price amount, mortgage amount, income,
household size, and race of the households served in the previous year's single-family
housing program, if any, must be included in each application; and

(4) for applicants who choose to have the agency issue bonds on their behalf, an
application fee pursuant to section 474A.03, subdivision 4, and an application deposit equal
to one percent of the requested allocation must be submitted to the Minnesota Housing
Finance Agency before the agency forwards the list specifying the amounts allocated to the
commissioner under paragraph (d). The agency shall submit the city's application fee and
application deposit to the commissioner when requesting an allocation from the housing
pool.

Applications by a consortium shall include the name of each member of the consortium
and the amount of allocation requested by each member.

(c) Any amounts remaining in the housing pool after June 15 are available for
single-family housing programs for cities that applied in January and received an allocation
under this section in the same calendar year. For a city that chooses to issue bonds on its
own behalf or pursuant to a joint powers agreement, the agency must allot available bonding
authority based on the formula in paragraphs (d) and (f). Allocations will be made loan by
loan, on a first-come, first-served basis among cities on whose behalf the Minnesota Housing
Finance Agency issues bonds.

Any city that received an allocation pursuant to paragraph (f) in the same calendar year
that wishes to issue bonds on its own behalf or pursuant to a joint powers agreement for an
amount becoming available for single-family housing programs after June 15 shall notify
the Minnesota Housing Finance Agency by June 15. The Minnesota Housing Finance
Agency shall notify each city making a request of the amount of its allocation within three
business days after June 15. The city must comply with paragraph (f).

For purposes of paragraphs (a) to (h), "city" means a county or a consortium of local
government units that agree through a joint powers agreement to apply together for
single-family housing programs, and has the meaning given it in section 462C.02, subdivision
6. "Agency" means the Minnesota Housing Finance Agency.

(d) The total amount of allocation for mortgage bonds for one city is limited to the lesser
of: (i) the amount requested, or (ii) the product of the total amount available for mortgage
bonds from the housing pool, multiplied by the ratio of each applicant's population as
determined by the most recent estimate of the city's population released by the state
demographer's office to the total of all the applicants' population, except that each applicant
shall be allocated a minimum of $100,000 regardless of the amount requested or the amount
determined under the formula in clause (ii). If a city applying for an allocation is located
within a county that has also applied for an allocation, the city's population will be deducted
from the county's population in calculating the amount of allocations under this paragraph.

Upon determining the amount of each applicant's allocation, the agency shall forward
to the commissioner a list specifying the amounts allotted to each application with all
application fees and deposits from applicants who choose to have the agency issue bonds
on their behalf.

Total allocations from the housing pool for single-family housing programs may not
exceed 27 percent of the adjusted allocation to the housing pool until after June 15 in 2020
and 2021, after which the allocations may not exceed 31 percent of the adjusted allocation
to the housing pool until after June 15.

(e) The agency may issue bonds on behalf of participating cities. The agency shall request
an allocation from the commissioner for all applicants who choose to have the agency issue
bonds on their behalf and the commissioner shall allocate the requested amount to the
agency. The agency may request an allocation at any time after the second Tuesday in
January and through the last Monday in June. After awarding an allocation and receiving
a notice of issuance for the mortgage bonds issued on behalf of the participating cities, the
commissioner shall transfer the application deposits to the Minnesota Housing Finance
Agency to be returned to the participating cities. The Minnesota Housing Finance Agency
shall return any application deposit to a city that paid an application deposit under paragraph
(b), clause (4), but was not part of the list forwarded to the commissioner under paragraph
(d).

(f) A city may choose to issue bonds on its own behalf or through a joint powers
agreement and may request an allocation from the commissioner by forwarding an application
with an application fee pursuant to section 474A.03, subdivision 4, and a one percent
application deposit to the commissioner no later than the Monday of the week preceding
an allocation. If the total amount requested by all applicants exceeds the amount available
in the pool, the city may not receive a greater allocation than the amount it would have
received under the list forwarded by the Minnesota Housing Finance Agency to the
commissioner. No city may request or receive an allocation from the commissioner until
the list under paragraph (d) has been forwarded to the commissioner. A city must request
an allocation from the commissioner no later than the last Monday in June. No city may
receive an allocation from the housing pool for mortgage bonds which has not first applied
to the Minnesota Housing Finance Agency. The commissioner shall allocate the requested
amount to the city or cities subject to the limitations under this paragraph.

If a city issues mortgage bonds from an allocation received under this paragraph, the
issuer must provide for the recycling of funds into new loans. If the issuer is not able to
provide for recycling, the issuer must notify the commissioner in writing of the reason that
recycling was not possible and the reason the issuer elected not to have the Minnesota
Housing Finance Agency issue the bonds. "Recycling" means the use of money generated
from the repayment and prepayment of loans for further eligible loans or for the redemption
of bonds and the issuance of current refunding bonds.

(g) No entitlement city or county or city in an entitlement county may apply for or be
allocated authority to issue mortgage bonds or use mortgage credit certificates from the
housing pool. No city in an entitlement county may apply for or be allocated authority to
issue residential rental bonds from the housing pool or the unified pool.

(h) A city that does not use at least 50 percent of its allotment by the date applications
are due for the first allocation that is made from the housing pool for single-family housing
programs in the immediately succeeding calendar year may not apply to the housing pool
for a single-family mortgage bond or mortgage credit certificate program allocation that
exceeds the amount of its allotment for the preceding year that was used by the city in the
immediately preceding year or receive an allotment from the housing pool in the succeeding
calendar year that exceeds the amount of its allotment for the preceding year that was used
in the preceding year. The minimum allotment is $100,000 for an allocation made prior to
June 15, regardless of the amount used in the preceding calendar year, except that a city
whose allocation in the preceding year was the minimum amount of $100,000 and who did
not use at least 50 percent of its allocation from the preceding year is ineligible for an
allocation in the immediate succeeding calendar year. Each local government unit in a
consortium must meet the requirements of this paragraph.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2023.
new text end

Sec. 31.

Minnesota Statutes 2020, section 474A.091, subdivision 3, is amended to read:

Subd. 3.

Allocation procedure.

(a) The commissioner shall allocate available bonding
authority under this section on the Monday of every other week beginning with the first
Monday in July through and on the last Monday in November. Applications for allocations
must be received by the department by 4:30 p.m. on the Monday preceding the Monday on
which allocations are to be made. If a Monday falls on a holiday, the allocation will be made
or the applications must be received by the next business day after the holiday.

(b) Prior to October 1, only the following applications shall be awarded allocations from
the unified pool. Allocations shall be awarded in the following order of priority:

(1) applications for residential rental project bonds;

(2) applications for small issue bonds for manufacturing projects; and

(3) applications for small issue bonds for agricultural development bond loan projects.

(c) On the first Monday in October through the last Monday in November, allocations
shall be awarded from the unified pool in the following order of priority:

(1) applications for student loan bonds issued by or on behalf of the Minnesota Office
of Higher Education;

(2) applications for mortgage bonds;

(3) applications for public facility projects funded by public facility bonds;

(4) applications for small issue bonds for manufacturing projects;

(5) applications for small issue bonds for agricultural development bond loan projects;

(6) applications for residential rental project bonds;

(7) applications for enterprise zone facility bonds;

(8) applications for governmental bonds; and

(9) applications for redevelopment bonds.

(d) If there are two or more applications for manufacturing projects from the unified
pool and there is insufficient bonding authority to provide allocations for all manufacturing
projects in any one allocation period, the available bonding authority shall be awarded based
on the number of points awarded a project under section 474A.045 with those projects
receiving the greatest number of points receiving allocation first. If two or more applications
for manufacturing projects receive an equal amount of points, available bonding authority
shall be awarded by lot unless otherwise agreed to by the respective issuers.

(e) If there are two or more applications for enterprise zone facility projects from the
unified pool and there is insufficient bonding authority to provide allocations for all enterprise
zone facility projects in any one allocation period, the available bonding authority shall be
awarded based on the number of points awarded a project under section 474A.045 with
those projects receiving the greatest number of points receiving allocation first. If two or
more applications for enterprise zone facility projects receive an equal amount of points,
available bonding authority shall be awarded by lot unless otherwise agreed to by the
respective issuers.

(f) If there are two or more applications for residential rental projects from the unified
pool and there is insufficient bonding authority to provide allocations for all residential
rental projects in any one allocation period, the available bonding authority shall be awarded
in the following order of priority: (1) preservation projects; (2) 30 percent AMI residential
rental projects; (3) 50 percent AMI residential rental projects for which the amount of bonds
requested in their respective applications do not exceed the aggregate bond limitations; (4)
100 percent LIHTC projects; (5) 20 percent LIHTC projects; and (6) other residential rental
projects. If there are two or more applications for residential rental projects at the same
priority level and there is insufficient bonding authority to provide allocations for all the
projects in any one allocation period, available bonding authority shall be deleted text begin randomly deleted text end awarded
by deleted text begin lot deleted text end new text begin giving preference for projects with a lower cost per square foot new text end but only for projects
that can receive the full amount of their respective requested allocations. If a residential
rental project does not receive any of its requested allocation pursuant to this paragraph and
the project applies in the next successive housing pool or the next successive unified pool
for an allocation of bonds, the project shall be fully funded up to its original application
request for bonding authority before any new project, applying in the same allocation period,
that has an equal priority shall receive bonding authority.

(g) From the first Monday in July through the last Monday in November, $20,000,000
of bonding authority or an amount equal to the total annual amount of bonding authority
allocated to the small issue pool under section 474A.03, subdivision 1, less the amount
allocated to issuers from the small issue pool for that year, whichever is less, is reserved
within the unified pool for small issue bonds to the extent the amounts are available within
the unified pool.

(h) The total amount of allocations for mortgage bonds from the housing pool and the
unified pool may not exceed:

(1) $10,000,000 for any one city; or

(2) $20,000,000 for any number of cities in any one county.

(i) The total amount of allocations for student loan bonds from the unified pool may not
exceed $25,000,000 per year.

(j) If there is insufficient bonding authority to fund all projects within any qualified bond
category other than enterprise zone facility projects, manufacturing projects, and residential
rental projects, allocations shall be awarded by lot unless otherwise agreed to by the
respective issuers.

(k) If an application is rejected, the commissioner must notify the applicant and return
the application deposit to the applicant within 30 days unless the applicant requests in writing
that the application be resubmitted.

(l) The granting of an allocation of bonding authority under this section must be evidenced
by issuance of a certificate of allocation.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2023.
new text end

Sec. 32.

Laws 2021, First Special Session chapter 8, article 6, section 1, subdivision 7, is
amended to read:

Subd. 7.

Report.

(a) No later than February 1, 2022, the task force shall submit an initial
report to the chairs and ranking minority members of the house of representatives and senate
committees and divisions with jurisdiction over housing and preventing homelessness on
its findings and recommendations.

(b) No later than deleted text begin August 31, 2022 deleted text end new text begin December 15, 2022 new text end , the task force shall submit a final
report to the chairs and ranking minority members of the house of representatives and senate
committees and divisions with jurisdiction over housing and preventing homelessness on
its findings and recommendations.

Sec. 33. new text begin PROHIBITION OF GRANT FUNDS FOR HIRING A LOBBYIST.
new text end

new text begin No grant funds awarded by the Housing Finance Agency may be used to hire a lobbyist
as defined in Minnesota Statutes, section 10A.01, subdivision 21.
new text end

Sec. 34. new text begin REPORT ON RENT CONTROL; PROHIBITION ON USE OF FUNDS.
new text end

new text begin (a) The Housing Finance Agency must complete a report regarding the impact of rent
control on housing markets. The report must explore the impact of rent control throughout
the United States, and may explore international housing markets. The report must also
include but is not limited to an examination of the following:
new text end

new text begin (1) the current housing market, including an analysis of supply and demand, in Minnesota,
in the Twin Cities metropolitan area, and within the cities of Minneapolis and St. Paul;
new text end

new text begin (2) the impact, both nationally and within Minnesota, on the construction of new housing
units within jurisdictions that have enacted rent control policies, as well as on nearby
jurisdictions without rent control policies;
new text end

new text begin (3) the impact of rent control on the maintenance of residential properties;
new text end

new text begin (4) whether enactment of rent control policies has led to increases in other regulatory
burdens related to housing in jurisdictions that have imposed rent control; and
new text end

new text begin (5) how rent control policies enacted within Minnesota compare to policies in jurisdictions
across the United States, including how various jurisdictions define "rent" for the purposes
of their policies, whether such policies exempt new construction, whether such policies
allow for tenancy decontrol, and how "fair return on investment" policies operate in other
jurisdictions with rent control policies, including an examination of how such policies are
administered and the criteria used to determine what constitutes a fair return on investment.
new text end

new text begin (b) The agency must consult with stakeholders, including renters, landlords, developers,
tradespeople, financers and lending institutions, and local governments during the preparation
of the report. The agency must also consult relevant academic literature and may consult
with academic institutions during the preparation of the report.
new text end

new text begin (c) The report must be submitted to chairs and ranking minority members of the legislative
committees with jurisdiction over housing by August 1, 2023.
new text end

new text begin (d) Until the report required by this section is delivered, the Housing Finance Agency
must not use any funds from any source on multifamily housing projects in cities that have
adopted a rent control ordinance.
new text end

Sec. 35. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2020, section 471.9996, subdivision 2, new text end new text begin is repealed.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively from November 1, 2021.
new text end

APPENDIX

Repealed Minnesota Statutes: S3994-1

471.9996 RENT CONTROL PROHIBITED.

Subd. 2.

Exception.

Subdivision 1 does not preclude a statutory or home rule charter city, county, or town from controlling rents on private residential property to the extent that the city, county, or town has the power to adopt an ordinance, charter amendment, or law to control these rents if the ordinance, charter amendment, or law that controls rents is approved in a general election. Subdivision 1 does not limit any power or authority of the voters of a statutory or home rule charter city, county, or town to petition for an ordinance or charter amendment to control rents on private residential property to the extent that the power or authority is otherwise provided for by law, and if the ordinance or charter amendment is approved in a general election. This subdivision does not grant any additional power or authority to the citizens of a statutory or home rule charter city, county, or town to vote on any question beyond that contained in other law.

Subdivision 1 does not apply to any statutory city unless the citizens of the statutory city have the authority to vote on the issue of rent control granted by other law.