Minnesota Session Laws - 1984, Regular Session

  

                         Laws of Minnesota 1984 

                        CHAPTER 581-H.F.No. 1999 
           An act relating to the city of Duluth; authorizing the 
          expansion of the energy conservation program to 
          include multifamily homes; amending Laws 1981, chapter 
          223, sections 2; and 6, subdivisions 2 and 3. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  Laws 1981, chapter 223, section 2, is amended 
to read:  
    Sec. 2.  [SURVEY AND CONTRACTS WITH HOMEOWNERS; SCOPE OF 
PROGRAM .] 
    Subdivision 1.  [SURVEYS, AUDITS AND CONTRACTS.] The city 
may survey homes to identify those where significant energy 
waste exists and can be reduced by energy conservation projects 
including but not limited to insulation, weatherstripping, 
temperature controls, storm windows and doors, furnace 
modifications, or conversion to cheaper or more plentiful energy 
sources, at a capital cost recoverable within a 10 year period 
from energy cost savings.  An energy audit to document the cost 
effectiveness of a full range of energy conserving measures must 
be performed prior to investment in such measures.  It may 
contract with the owners of such homes to cause work and 
materials to be furnished for such projects by the means 
authorized in section 3 and subject to reimbursement in the ways 
contemplated in section 4.  
     Subd. 2.  [OWNER-OCCUPIED AND MULTIFAMILY HOMES.] The 
program shall be limited to may include improvements to:  
    (1) "owner-occupied homes", defined as homes containing not 
more than four dwelling units, one occupied as a principal 
residence by an owner not engaged in the trade or business of 
rental real estate, and 
    (2) "multifamily homes", defined as structures or parts of 
structures rented from the owner and occupied as a principal 
residence by each renter.  
    Subd. 3.  [SERIES OF BONDS AND NOTES.] Revenue bonds or 
notes authorized by section 5, if the proceeds are to be used 
for improvements to multifamily homes, shall be issued in one or 
more series separate from series of bonds or notes issued for 
improvements to owner-occupied homes.  
    Subd. 4.  [IMPROVEMENTS TO OTHER PROPERTY.] Nothing herein, 
however, shall preclude the city from constructing or financing 
similar energy conservation improvements to other property, in 
any manner otherwise authorized by law or the city charter. 
     Sec. 2.  Laws 1981, chapter 223, section 6, subdivision 2, 
is amended to read:  
     Subd. 2.  [STATUS AND PROCEEDS OF BONDS AND NOTES.] The 
revenue bonds and notes authorized herein are not considered to 
be mortgage subsidy bonds within the meaning of section 103A of 
the Internal Revenue Code of 1954, as amended, or bonds issued 
to provide projects for residential rental property within the 
meaning of section 103(b)(4)(A), of said Code, which provides 
provide that the interest on such bonds is subject to federal 
income taxation unless exempted by reason of the performance of 
certain conditions stated in these sections; because they the 
bonds and notes are authorized for the purpose of financing 
improvements needed for the welfare of the city as a whole, to 
avoid hardship which would result from the failure of utility 
service within the city.  The proceeds are not to be used for 
owner-financing of financing owner-occupied or multifamily home 
improvements generally, but for financing the city's undertaking 
of improvements which, though situated on private premises, are 
needed to protect all the citizens, in a manner which is 
intended to pay the cost without thereby raising materially the 
level of current home energy costs of either the owners of the 
premises or other utility customers. 
     Sec. 3.  Laws 1981, chapter 223, section 6, subdivision 3, 
is amended to read:  
     Subd. 3.  [GENERAL POWERS.] Notwithstanding the provisions 
of subdivision 2, the city is authorized to do all things 
determined on the advice of counsel to be necessary or desirable 
to assure that any issue of revenue bonds or notes hereunder, if 
subject to section 103A or section 103(b)(4)(A) of the Internal 
Revenue Code of 1954, as amended, will be a qualified mortgage 
bond issue or will provide projects for residential rental 
property as described therein, the interest on which through the 
performance of conditions necessary to assure that the interest 
will be and remain exempt from federal income taxation.  Until 
and unless it is determined by a clarifying amendment of section 
103A of the Internal Revenue Code of 1954, as amended, or by 
rulings or regulations of the internal revenue service or a 
decision of a court of competent jurisdiction, that such issues 
are not mortgage subsidy bonds, the applicable limit established 
pursuant to section 103A of the Internal Revenue Code of 1954, 
as amended, upon the amount of qualified mortgage bonds which 
the city may issue in any calendar year, shall be $3,000,000.  
    Sec. 4.  [EFFECTIVE DATE.] 
    This act is effective upon compliance by the governing body 
of the city of Duluth with Minnesota Statutes, section 645.021, 
subdivision 3.  
    Approved April 26, 1984