SF 3994

as introduced - 92nd Legislature (2021 - 2022) Posted on 03/31/2022 03:54pm

A bill for an act
relating to housing; appropriating money for the governor's supplemental housing
budget; appropriating money for the Minnesota Housing Finance Agency;
appropriating money for the Department of Human Rights to investigate income
discrimination in housing; establishing the community stabilization housing
program; establishing the strengthening supportive housing model program;
modifying eligible uses for loans and grants; amending Minnesota Statutes 2020,
sections 462A.201, subdivision 2; 462A.204, subdivision 8; proposing coding for
new law in Minnesota Statutes, chapter 462A.

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 225,500,000 new text end

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

new text begin Subd. 2. new text end new text begin Challenge Program new text end

new text begin 25,000,000 new text end

new text begin (a) This appropriation is for the economic
development and housing challenge program
under Minnesota Statutes, sections 462A.07,
subdivision 14, and 462A.33.
new text end

new text begin (b) In fiscal years 2024 and 2025, $15,000,000
is added to the agency's base.
new text end

new text begin Subd. 3. new text end new text begin Workforce Housing Development new text end

new text begin 10,000,000 new text end

new text begin This appropriation is for the Greater
Minnesota workforce housing development
program under Minnesota Statutes, section
462A.39. If requested by the applicant and
approved by the agency, funded properties
may include a portion of income and rent
restricted units. Funded properties may include
owner-occupied homes. In fiscal years 2024
and 2025, $8,000,000 is added to the agency's
base.
new text end

new text begin Subd. 4. new text end new text begin Workforce Homeownership Program new text end

new text begin 12,000,000 new text end

new text begin This appropriation is for the workforce
homeownership program under Minnesota
Statutes, section 462A.38. In fiscal years 2024
and 2025, $12,000,000 is added to the agency's
base.
new text end

new text begin Subd. 5. new text end new text begin Housing Trust Fund new text end

new text begin 10,000,000 new text end

new text begin This appropriation is for deposit in the housing
trust fund account created under Minnesota
Statutes, section 462A.201, and may be used
for the purposes provided in that section. In
fiscal years 2024 and 2025, $12,500,000 is
added to the agency's base.
new text end

new text begin Subd. 6. new text end new text begin Homework Starts with Home new text end

new text begin 10,000,000 new text end

new text begin (a) This appropriation is for the homework
starts with home program under Minnesota
Statutes, sections 462A.201, subdivision 2,
paragraph (a), clause (4), and 462A.204,
subdivision 8, to provide assistance to
homeless or highly mobile families with minor
children or expecting parents. Funding must
prioritize families with younger children not
yet in school who are identified as being at
risk of homelessness or experiencing
homelessness.
new text end

new text begin (b) In fiscal years 2024 and 2025, $10,000,000
is added to the agency's base.
new text end

new text begin Subd. 7. new text end new text begin Family Homeless Prevention new text end

new text begin 24,500,000 new text end

new text begin (a) This appropriation is for the family
homeless prevention and assistance programs
under Minnesota Statutes, section 462A.204.
new text end

new text begin (b) Of this amount, $5,000,000 in fiscal year
2023 is for a risk mitigation fund program to
provide financial guarantees, case management
services, and other resources such as
incentives to encourage rental housing owners
to rent to tenants they would otherwise not
likely rent to. This is a onetime appropriation.
new text end

new text begin (c) In fiscal years 2024 and 2025, $9,500,000
is added to the agency's base.
new text end

new text begin Subd. 8. new text end new text begin Community Stabilization new text end

new text begin 100,000,000 new text end

new text begin This appropriation is for the community
stabilization program under Minnesota
Statutes, section 462A.41, to finance
improvements for naturally occurring
affordable housing. This is a onetime
appropriation.
new text end

new text begin Subd. 9. new text end new text begin Flexible Financing for Capital Costs new text end

new text begin 10,000,000 new text end

new text begin This appropriation is to provide gap financing
to rental housing developments financed by
the agency. This is a onetime appropriation.
new text end

new text begin Subd. 10. new text end new text begin Homeownership Assistance Fund new text end

new text begin 12,000,000 new text end

new text begin (a) This appropriation is for the home
ownership assistance program under
Minnesota Statutes, section 462A.21,
subdivision 8. The agency shall continue to
strengthen its efforts to address the disparity
gap in the homeownership rate between white
households and Indigenous American Indians
and communities of color. To better
understand and address the disparity gap, the
agency is required to collect, on a voluntary
basis, demographic information regarding
race, color, national origin, and sex of
applicants for agency programs intended to
benefit homeowners and home buyers.
new text end

new text begin (b) In fiscal years 2024 and 2025, $10,000,000
is added to the agency's base.
new text end

new text begin Subd. 11. new text end new text begin Strengthen the Supportive Housing Model new text end

new text begin 12,000,000 new text end

new text begin This appropriation is for the strengthening
supportive housing model program under
Minnesota Statutes, section 462A.42, to
provide funding to strengthen supportive
housing for individuals and families who are
at risk of homelessness or have experienced
homelessness. In fiscal years 2024 and 2025,
$15,000,000 is added to the agency's base.
new text end

Sec. 3. new text begin DEPARTMENT OF HUMAN RIGHTS new text end

new text begin $ new text end

new text begin 383,000 new text end

new text begin $383,000 in fiscal year 2023 is to the
commissioner of human rights for increased
capacity and associated costs to investigate
sources of income discrimination cases in
housing.
new text end

ARTICLE 2

HOUSING PROGRAM ELIGIBILITY

Section 1.

Minnesota Statutes 2020, section 462A.201, subdivision 2, is amended to read:

Subd. 2.

Low-income housing.

(a) The agency may use money from the housing trust
fund account to provide loans or grants for:

(1) projects for the development, construction, acquisition, preservation, and rehabilitation
of low-income rental and limited equity cooperative housing units, including temporary
and transitional housing;

(2) the costs of operating rental housing, as determined by the agency, that are unique
to the operation of low-income rental housing or supportive housing;

(3) rental assistance, either project-based or tenant-based; and

(4) programs to secure stable housing for families with new text begin minor children or with new text end children
eligible for enrollment in a prekindergarten through grade 12 academic program.

For purposes of this section, "transitional housing" has the meaning given by the United
States Department of Housing and Urban Development. Loans or grants for residential
housing for migrant farmworkers may be made under this section.

(b) The housing trust fund account must be used for the benefit of persons and families
whose income, at the time of initial occupancy, does not exceed 60 percent of median income
as determined by the United States Department of Housing and Urban Development for the
metropolitan area. At least 75 percent of the funds in the housing trust fund account must
be used for the benefit of persons and families whose income, at the time of initial occupancy,
does not exceed 30 percent of the median family income for the metropolitan area as defined
in section 473.121, subdivision 2. For purposes of this section, a household with a housing
assistance voucher under Section 8 of the United States Housing Act of 1937, as amended,
is deemed to meet the income requirements of this section.

The median family income may be adjusted for families of five or more.

(c) Rental assistance under this section must be provided by governmental units which
administer housing assistance supplements or by for-profit or nonprofit organizations
experienced in housing management. Rental assistance shall be limited to households whose
income at the time of initial receipt of rental assistance does not exceed 60 percent of median
income, as determined by the United States Department of Housing and Urban Development
for the metropolitan area. Priority among comparable applications for tenant-based rental
assistance will be given to proposals that will serve households whose income at the time
of initial application for rental assistance does not exceed 30 percent of median income, as
determined by the United States Department of Housing and Urban Development for the
metropolitan area. Rental assistance must be terminated when it is determined that 30 percent
of a household's monthly income for four consecutive months equals or exceeds the market
rent for the unit in which the household resides plus utilities for which the tenant is
responsible. Rental assistance may only be used for rental housing units that meet the housing
maintenance code of the local unit of government in which the unit is located, if such a code
has been adopted, or the housing quality standards adopted by the United States Department
of Housing and Urban Development, if no local housing maintenance code has been adopted.

(d) In making the loans or grants, the agency shall determine the terms and conditions
of repayment and the appropriate security, if any, should repayment be required. To promote
the geographic distribution of grants and loans, the agency may designate a portion of the
grant or loan awards to be set aside for projects located in specified congressional districts
or other geographical regions specified by the agency. The agency may adopt rules for
awarding grants and loans under this subdivision.

Sec. 2.

Minnesota Statutes 2020, section 462A.204, subdivision 8, is amended to read:

Subd. 8.

deleted text begin School deleted text end new text begin Childhood housing new text end stability.

(a) The agency in consultation with the
Interagency Council on Homelessness may establish a deleted text begin school deleted text end new text begin childhood housing new text end stability
project under the family homeless prevention and assistance program. The purpose of the
project is to secure stable housing for families with deleted text begin school-age deleted text end new text begin minor new text end children who have
moved frequently and for unaccompanied youth. For purposes of this subdivision,
"unaccompanied youth" are minors who are leaving foster care or juvenile correctional
facilities, or minors who meet the definition of a child in need of services or protection
under section 260C.007, subdivision 6, but for whom no court finding has been made
pursuant to that statute.

(b) The agency shall make grants to family homeless prevention and assistance projects
in communities with a school or schools that have a significant degree of student mobility new text begin
or in communities with a significant degree of homelessness among families with minor
children new text end .

(c) Each project must be designed to reduce school absenteeism; stabilize children in
one home setting or, at a minimum, in one school setting; deleted text begin and deleted text end new text begin or new text end reduce shelter usage. Each
project must include plans for the following:

(1) targeting of families with new text begin minor new text end children who deleted text begin are eligible for a prekindergarten
through grade 12 academic program and deleted text end are living in overcrowded conditions in their current
housing; are paying more than 50 percent of their income for rent; or who lack a fixed,
regular, and adequate nighttime residence;

(2) targeting of unaccompanied youth in need of an alternative residential setting;

(3) connecting families with the social services necessary to maintain the families'
stability in their home, including but not limited to housing navigation, legal representation,
and family outreach; and

(4) one or more of the following:

(i) provision of rental assistance for a specified period of time, which may exceed 24
months; or

(ii) provision of support and case management services to improve housing stability,
including but not limited to housing navigation and family outreach.

(d) In selecting projects for funding under this subdivision, preference shall be given to
organizations granted funding under section 462A.201, subdivision 2, paragraph (a), clause
(4).

(e) No grantee under this subdivision is required to have an advisory committee as
described in subdivision 6.

Sec. 3.

new text begin [462A.41] COMMUNITY STABILIZATION PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment. new text end

new text begin The agency shall establish a community stabilization
program for the purpose of providing grants or loans for the preservation of naturally
occurring affordable housing through acquisition or rehabilitation.
new text end

new text begin Subd. 2. new text end

new text begin Definitions. new text end

new text begin For the purposes of this section, "naturally occurring affordable
housing" means:
new text end

new text begin (1) multiunit rental housing that:
new text end

new text begin (i) is at least 20 years old;
new text end

new text begin (ii) has rents in a majority of units that are affordable to households at or below 60
percent of the greater of state or area median income as determined by the United States
Department of Housing and Urban Development; and
new text end

new text begin (iii) meets other requirements as determined by the agency; or
new text end

new text begin (2) single-family, owner-occupied housing located in communities where market
pressures or significant deferred rehabilitation needs, as defined by the agency, are creating
opportunities for displacement or the loss of single-family homes affordable to households
at or below 115 percent of the greater of state or area median income as determined by the
United States Department of Housing and Urban Development.
new text end

new text begin Subd. 3. new text end

new text begin Eligible recipients. new text end

new text begin Grants or loans may be made to a local unit of government;
a federally recognized American Indian tribe located in Minnesota or its Tribally Designated
Housing Entity; a private developer; limited equity cooperatives; cooperatives created under
chapter 308A or 308B; community land trusts created for the purposes outlined in section
462A.31, subdivision 1; or a nonprofit organization. The agency may consider the use of
an intermediary or intermediaries to facilitate the acquisition of existing housing.
new text end

new text begin Subd. 4. new text end

new text begin Eligible uses. new text end

new text begin The program shall provide grants or loans for the purpose of
acquisition, rehabilitation, interest rate reduction, or gap financing of housing to support
the preservation of naturally occurring affordable housing. Priority in funding may be given
to proposals that serve lower incomes.
new text end

new text begin Subd. 5. new text end

new text begin Single-family, owner-occupied housing income limits. new text end

new text begin Households served
through grants or loans related to single-family, owner-occupied housing must have, at
initial occupancy, income that is at or below 115 percent of the greater of state or area
median income as determined by the United States Department of Housing and Urban
Development.
new text end

new text begin Subd. 6. new text end

new text begin Multifamily housing rent limits. new text end

new text begin Multifamily housing financed through grants
or loans under this section must remain affordable to low-income or moderate-income
households as defined by the agency.
new text end

new text begin Subd. 7. new text end

new text begin Application. new text end

new text begin The agency shall develop forms and procedures for soliciting and
reviewing applications for loan or grants under this section. The agency shall consult with
interested stakeholders when developing the guidelines and procedures for the program.
new text end

new text begin Notwithstanding any other applicable law, the agency may accept applications on a
noncompetitive, rolling basis in order to provide funds for eligible properties as they become
available.
new text end

new text begin Subd. 8. new text end

new text begin Voucher requirement for multifamily properties. new text end

new text begin Rental properties that
receive funds must accept rental subsidies, including but not limited to vouchers under
Section 8 of the United States Housing Act of 1937, as amended.
new text end

Sec. 4.

new text begin [462A.42] STRENGTHENING SUPPORTIVE HOUSING MODEL.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment. new text end

new text begin The agency shall establish a strengthening supportive
housing model program for the purpose of providing funding to strengthen supportive
housing for individuals and families who are at risk of homelessness or have experienced
homelessness.
new text end

new text begin Subd. 2. new text end

new text begin Definition. new text end

new text begin For the purposes of this section, "supportive housing" means housing
that is not time-limited and provides or coordinates with linkages to services necessary for
residents to maintain housing stability and maximize opportunities for education and
employment.
new text end

new text begin Subd. 3. new text end

new text begin Eligible recipients. new text end

new text begin Funding may be made to a local unit of government, a
federally recognized American Indian Tribe or its Tribally Designated Housing Entity
located in Minnesota, a private developer, or a nonprofit organization.
new text end

new text begin Subd. 4. new text end

new text begin Eligible uses. new text end

new text begin (a) Funds shall be used to cover costs needed for supportive
housing to operate effectively that are not covered by other federal or state resources. Costs
may include but are not limited to building operating expenses such as front desk, tenant
service coordination, revenue shortfall, and security costs.
new text end

new text begin (b) Funds shall be used to create partnerships with the health care sector and other sectors
to demonstrate sustainable ways to provide services for supportive housing residents, improve
access to health care, and reduce the use of expensive emergency and institutional care.
This may be done in partnership with other state agencies, including the Department of
Health and the Department of Human Services.
new text end

new text begin Subd. 5. new text end

new text begin Application. new text end

new text begin The commissioner shall develop forms and procedures for soliciting
and reviewing applications for funding under this section. The commissioner shall consult
with interested stakeholders when developing the guidelines and procedures for the program.
new text end