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Key: (1) language to be deleted (2) new language

  

                         Laws of Minnesota 1989 

                        CHAPTER 328-S.F.No. 522 
           An act relating to community development; authorizing 
          the establishment of affordable housing programs under 
          the administration of the Minnesota housing finance 
          agency; establishing a neighborhood preservation 
          program; revising certain tenant damage provisions in 
          landlord-tenant actions; regulating tenant screening 
          services; establishing a rent escrow system; providing 
          mandatory building repair fines; authorizing a housing 
          calendar consolidation pilot project in Hennepin and 
          Ramsey counties; revising certain housing receivership 
          provisions; providing a limited right of entry to 
          secure vacant or unoccupied buildings; providing for 
          city housing rehabilitation loan programs; 
          establishing the community and neighborhood 
          development organization program; establishing a child 
          development program; authorizing a neighborhood 
          revitalization program; establishing a youth 
          employment and housing program; requiring housing 
          impact reports and replacement housing under certain 
          conditions in cities of the first class; imposing 
          penalties; amending Minnesota Statutes 1988, sections 
          268.361, subdivision 4, and by adding a subdivision; 
          268.362; 268.364; 268.365; 268.366; 268.367; 282.01, 
          subdivision 1; 462A.03, by adding a subdivision; 
          462A.05, subdivisions 24 and 27, and by adding 
          subdivisions; 462A.21, subdivisions 4k and 12, and by 
          adding subdivisions; 462C.02, by adding subdivisions; 
          462C.05, by adding a subdivision; 463.15, subdivisions 
          3 and 4; 463.16; 463.161; 463.17; 463.20; 463.21; 
          463.22; 469.007; 469.012, subdivision 1; 504.255; 
          504.26; 566.17; 566.175, subdivision 1; 566.29, 
          subdivisions 1 and 4, and by adding subdivisions; 
          580.04; 580.12; 580.23, subdivision 1; 580.24; 581.10; 
          582.03; and 582.30, subdivision 2; Laws 1974, chapter 
          285, sections 1, 2, 3, 4, and by adding a section; 
          proposing coding for new law in Minnesota Statutes, 
          chapters 16B; 116J; 129A; 363; 462A; 462C.13; 469; 
          504; 566; and 582; repealing Minnesota Statutes 1988, 
          section 474A.081, subdivision 3; Laws 1974, chapter 
          351, sections 1 to 4, as amended; Laws 1975, chapter 
          260, sections 1 to 5; and Laws 1987, chapters 384, 
          article 3, section 22; and 386, article 6, sections 4 
          to 11. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 

                                ARTICLE 1 

                      AFFORDABLE HOUSING PROGRAMS 
    Section 1.  [16B.89] [ACQUISITION OF SURPLUS FEDERAL 
PROPERTY.] 
    The commissioner of administration, after consultation with 
one or more nonprofit organizations with an interest in 
providing housing for homeless veterans and their families, may 
acquire property from the United States government that is 
designated by the General Services Administration as surplus 
property.  The commissioner of administration may lease the 
property to a qualified nonprofit organization that agrees to 
develop or rehabilitate the property for the purpose of 
providing suitable housing for veterans and their families.  The 
lease agreement with the nonprofit organization may require that 
the property be developed for use as housing for homeless and 
displaced veterans and their families and for veterans and their 
families who lose their housing.  
    Sec. 2.  [129A.11] [ACCESSIBLE HOUSING INFORMATION.] 
    The commissioner of jobs and training may make accessible 
housing information grants to eligible organizations to develop, 
maintain, and publicize a list of accessible housing units 
within their area of operation, based on recommendations of the 
disability council.  For purposes of this section, accessible 
housing unit means an accessible housing unit that meets the 
handicapped facility requirements of the state building code, 
Minnesota Rules, chapter 1340.  The list may also include 
housing units that do not meet handicapped facility code 
requirements, but that are accessible to disabled persons.  The 
list must be made available at no cost to persons seeking 
accessible housing and must be updated at least every two 
months.  An eligible organization must have the capability to 
develop, maintain, and publicize a list of accessible housing 
units within the organization's area of operation. 
    Sec. 3.  Minnesota Statutes 1988, section 462A.03, is 
amended by adding a subdivision to read: 
    Subd. 21.  [CITY.] "City" has the meaning given in section 
462C.02, subdivision 6. 
    Sec. 4.  Minnesota Statutes 1988, section 462A.05, is 
amended by adding a subdivision to read: 
    Subd. 14c.  [NEIGHBORHOOD PRESERVATION.] It may agree or 
enter commitments to purchase, make, or participate in making 
loans described in subdivision 14 for programs approved by the 
agency for the preservation of designated neighborhoods.  To 
achieve the policy of economic integration stated in section 
462A.02, subdivision 6, the programs may authorize loans to 
borrowers having ownership interests in properties in the 
neighborhood who are not eligible mortgagors as defined in 
section 462A.03, subdivision 13.  The aggregate original 
principal balances of noneligible mortgagor loans in a 
neighborhood benefiting from financing under this subdivision 
must not exceed 25 percent of the total amount of neighborhood 
preservation loan funds allocated to the neighborhood under the 
program. 
    Sec. 5.  Minnesota Statutes 1988, section 462A.05, 
subdivision 24, is amended to read: 
    Subd. 24.  It may engage in housing programs for low and 
moderate income elderly, handicapped, or developmentally 
disabled persons, as defined by the agency, to provide grants or 
loans, with or without interest, for 
    (1) accessibility improvements to residences occupied by 
elderly persons; 
    (2) housing sponsors, as defined by the agency, of home 
sharing programs to match existing elderly homeowners with 
prospective tenants who will contribute either rent or services 
to the homeowner, where either the homeowner or the prospective 
tenant is elderly, handicapped, or developmentally disabled; 
    (3) the construction of or conversion of existing buildings 
into structures for occupancy by the elderly that contain from 
three to 12 private sleeping rooms with shared cooking 
facilities and common space; and 
    (4) housing sponsors, as defined by the agency, to 
demonstrate the potential for home equity conversion in 
Minnesota for the elderly, in both rural and urban areas, and to 
determine the need in those equity conversions for consumer 
safeguards.  
    In making the grants or loans, the agency shall determine 
the terms and conditions of repayment and the appropriate 
security, if any, should repayment be required.  The agency may 
provide technical assistance to sponsors of home sharing 
programs or may contract or delegate the provision of the 
technical assistance in accordance with section 462A.07, 
subdivision 12. 
    Housing sponsors who receive funding through these programs 
shall provide homeowners and tenants participating in a home 
sharing program with information regarding their rights and 
obligations as they relate to federal and state tax law 
including, but not limited to, taxable rental income, homestead 
credit under chapter 273, and the property tax refund act under 
chapter 290A. 
    Sec. 6.  Minnesota Statutes 1988, section 462A.05, 
subdivision 27, is amended to read: 
    Subd. 27.  The agency, or the corporations referred to in 
subdivision 26, may acquire property or property interests under 
subdivisions 25 and 26 and section 462A.06, subdivision 7, for 
the following purposes:  (1) to protect a loan or grant in which 
the agency or corporation has an interest; or (2) to preserve 
for the use of low- and moderate-income persons or families 
multifamily housing, previously financed by the agency, which 
was (i) previously financed by the agency, or (ii) not financed 
by the agency but is benefited by federal housing assistance 
payments or other rental subsidy or interest reduction 
contracts.  Property or property interests acquired for the 
purpose specified in clause (1) may be acquired by foreclosure, 
deed in lieu of foreclosure, or otherwise. 
    Multifamily property acquired as provided in clause (2) 
must be managed on a fee basis by an entity other than the 
agency or corporation.  The agency or corporation may manage the 
property on a temporary basis until an agreement is entered into 
with another entity to manage the property.  The agency or 
corporation shall make the property available for sale at a 
purchase price and on terms that are mutually agreeable to the 
parties.  In the sale of property benefited by federal housing 
assistance, priority must be given to a buyer who agrees to 
maintain the federal housing assistance.  
    Sec. 7.  Minnesota Statutes 1988, section 462A.05, is 
amended by adding a subdivision to read: 
    Subd. 34.  [HOME EQUITY CONVERSION LOANS.] (a) The agency 
may make or purchase home equity conversion loans for low- or 
moderate-income elderly homeowners.  Loan recipients must be at 
least 62 years of age, have substantial equity in their home, 
and have an income at or below 50 percent of the greater of 
statewide or area median income.  The agency must inform a 
program participant of available home equity conversion loan 
counseling services before making a loan. 
    (b) Repayment of a home equity conversion loan may not be 
required until at least one of the following conditions occurs: 
    (1) the sale or conveyance of the mortgaged property; 
    (2) the mortgaged property is no longer the mortgagor's 
principal residence; 
    (3) the death of the mortgagor; or 
    (4) a violation of an obligation of the mortgagor under the 
mortgage. 
    For purposes of this section, an obligation of the 
mortgagor under the mortgage does not include immediate 
repayment upon completion of loan disbursements at the end of a 
specified term. 
    Sec. 8.  [462A.057] [MINNESOTA RURAL AND URBAN HOMESTEADING 
PROGRAM.] 
    Subdivision 1.  [ESTABLISHMENT; PURPOSE.] There is 
established the Minnesota rural and urban homesteading program 
to be administered by the agency for grants to eligible 
applicants to acquire, rehabilitate, and sell eligible property. 
The program is directed at single family residential properties 
in need of rehabilitation that are sold to "at risk" homebuyers 
committed to strengthening the neighborhood and following a good 
neighbor policy. 
    Subd. 2.  [DEFINITIONS.] For the purposes of this section, 
the following terms have the meanings given them. 
    (1) "Contract for deed" is the agreement between the 
homebuyer and eligible applicant as established by the agency. 
    (2) "Eligible organization" or "organization" means a 
political subdivision, nonprofit or cooperative organization, as 
defined by the agency, housing and redevelopment authority, or 
other organization designated by the agency, which demonstrates 
the capacity to perform the duties outlined in subdivision 5. 
    (3) "Eligible property" or "property" means a single family 
residential dwelling and surrounding property that is vacant, 
condemned, abandoned, or otherwise defined as eligible by the 
agency, which, if rehabilitated, may prevent or arrest the 
spread of blight. 
    (4) "Homebuyer" means an individual or family who has not 
owned a residential dwelling in the past three years and meets 
the definition of "at risk" established by the agency under 
subdivision 4. 
    (5) "Designated home ownership area" or "designated area" 
means a specific area where the acquisition, rehabilitation, and 
sale of eligible properties may take place under this section.  
In the metropolitan area, as defined in section 473.121, 
subdivision 2, a designated area must be a specific four square 
block area.  
    (6) "Neighborhood volunteer resident advisory board" or 
"advisory board" means the board established by an organization 
under subdivision 6. 
    (7) "Program" means the Minnesota rural and urban 
homesteading program established in subdivision 1. 
    Subd. 3.  [GRANTS.] The agency may award grants of up to 
$300,000 to eligible organizations.  The grants must be used by 
the organization to buy eligible properties and pay for the 
costs of rehabilitating those properties.  Up to $30,000 of the 
grant award may be used for the administrative costs of the 
organization and for other costs associated with the acquisition 
and sale of properties under this program including the payment 
of taxes on the property during the period between the purchase 
and sale of the property. 
    Subd. 4.  [AGENCY POWERS; DUTIES.] The agency shall: 
    (1) establish criteria for selecting which eligible 
organizations that apply for grants under this section receive 
the grants; 
    (2) establish criteria for targeting the program to 
homebuyers who are at risk which is defined to include families 
and individuals who are homeless, receiving public assistance, 
or otherwise cannot afford home ownership; and 
    (3) establish the terms and provisions of the contract for 
deed and other program standards as necessary. 
    Subd. 5.  [ELIGIBLE ORGANIZATION; CAPACITY.] The eligible 
organization must demonstrate to the agency that it has the 
capacity to: 
    (1) organize and continue an ongoing relationship with the 
neighborhood volunteer resident advisory boards required under 
subdivision 6; 
    (2) provide the necessary staff to administer the program 
on the local level for an extended period; and 
    (3) select and acquire property that meets the requirements 
established for this program and contract with businesses or 
organizations for the rehabilitation of the property. 
    Subd. 6.  [NEIGHBORHOOD VOLUNTEER RESIDENT ADVISORY BOARD.] 
Each organization must establish a neighborhood volunteer 
resident advisory board for each designated area.  The advisory 
board must consist of residents of the designated area that 
reflects the racial composition of the area.  In the 
metropolitan area, as defined in section 473.121, subdivision 2, 
at least 20 percent of the advisory board must be minority 
residents.  The advisory board must:  
    (1) recommend to the organization properties that may be 
acquired for the program in the designated area; and 
    (2) recommend to the organization the selection of 
homebuyers. 
    Subd. 7.  [PURCHASE AND REHABILITATION.] An eligible 
organization may acquire up to five properties in a designated 
area with the consent of the advisory board for that area.  The 
organization must rehabilitate these properties to the standards 
established by the agency.  The total maximum cost of the 
acquisition, rehabilitation, closing costs, and back taxes must 
be no greater than $50,000 per individual property.  The $50,000 
maximum may be exceeded if the excess costs over $50,000 are 
attributed to rehabilitation or improvements to make the 
property handicapped accessible.  
    Subd. 8.  [SALE OF PROPERTY TO HOMEBUYER.] The eligible 
organization may sell rehabilitated property to homebuyers.  The 
terms and other provisions of the contract for deed must be 
established by the agency.  The following requirements must be 
included in the contract:  (1) the purchase price paid by the 
home buyer must be equal to the total costs of acquiring and 
rehabilitating the property; (2) no down payment or interest 
payment is required of the home buyer; and (3) the monthly 
payment must equal 25 percent of the home buyer's gross monthly 
income. 
    Subd. 9.  [RIGHT TO REPURCHASE.] The eligible organization 
may repurchase the property if the home buyer rents, assigns, 
vacates, transfers, or offers to sell the property within 20 
years of the purchase of the property from the organization.  
This option to repurchase does not apply to a transfer of the 
property to a surviving joint tenant or heir of the home buyer.  
If the organization chooses not to exercise its option to 
repurchase the property, the agency may repurchase the property. 
    The repurchase price paid by the organization or the agency 
may not exceed the lesser of the (1) appraised value of the 
property at the time of repurchase, or (2) the sum of: 
     (i) the total amount paid by the home owner to the 
organization for debt payment on the contract for deed; 
     (ii) the value of any major improvements to the property 
that are paid directly by the home buyer and were not part of 
the required monthly payment; and 
     (iii) the product of the sum of (i) and (ii), and the 
increase in inflation based on the housing component of the 
federal Consumer Price Index. 
    Subd. 10.  [REPORTS.] Each organization that receives a 
grant under this section shall submit an annual report to the 
agency by December 1 of each year that describes the use of 
grant funds received under this section.  
    The agency shall prepare and submit an annual report to the 
legislature and the governor by January 15 of each year, 
beginning in 1991, that summarizes the reports of the 
organizations.  The agency's report may also include 
recommendations to improve the program. 
    Sec. 9.  [462A.203] [HOUSING PRESERVATION PROGRAM.] 
    Subdivision 1.  [ESTABLISHMENT.] The agency may establish a 
housing preservation program for the purpose of making housing 
preservation grants to cities.  Cities may use the grants to 
establish revolving loan funds for the acquisition, improvement, 
or rehabilitation of residential buildings for the purpose of 
preserving eligible housing.  To achieve the policy of economic 
integration stated in section 462A.02, subdivision 6, the 
aggregate original principal balances of noneligible mortgagor 
loans must not exceed 25 percent of the total amount of housing 
preservation loan funds allocated to a city provided that the 
mortgagor's income must not exceed 110 percent of the area 
median income.  Housing preservation loans may not be made for 
housing located within a targeted neighborhood designated under 
a neighborhood revitalization program. 
    Subd. 2.  [ELIGIBILITY REQUIREMENTS.] A city's application 
for a housing preservation grant must include a geographic 
description of the area for which the grant will be used.  A 
city may designate only one area for each grant application 
submitted, but may submit more than one application.  The 
application must include a city council resolution certifying 
that the designated area meets the following requirements: 
    (1) at least 70 percent of the single-family housing is at 
least 35 years old; 
    (2) at least 60 percent of the single-family housing is 
owner-occupied; 
    (3) the average market value of the area's owner-occupied 
housing is not more than 100 percent of the purchase price limit 
for existing homes eligible for purchase in the area under the 
agency's home mortgage loan program; and 
    (4) the geographic area consists of contiguous parcels of 
land.  
    Subd. 3.  [LOCAL MATCH.] In order to qualify for a program 
grant, a city must match every dollar of state money with one 
dollar of city matching funds.  City matching funds may consist 
of: 
    (1) money from the general fund or a special fund of the 
city; 
    (2) money paid or repaid to a city from the proceeds of a 
grant that the city has received from the federal government, a 
profit or nonprofit corporation, or another entity or 
individual; 
    (3) the greater of the fair market value or the cost to the 
city of acquiring land, buildings, equipment, or other real or 
personal property that a city contributes, grants, or loans to a 
profit or nonprofit corporation, or other entity or individual 
in connection with the implementation of the housing 
preservation program; 
    (4) money to be used to install, reinstall, repair, or 
improve the infrastructure facilities of an eligible area; 
    (5) money contributed by a city to pay issuance costs or to 
otherwise provide financial support for revenue bonds or 
obligations issued for a project or program related to the 
implementation of a housing preservation program; and 
    (6) money derived from fees received by a city in 
connection with its community development activities that are to 
be used in implementing a housing preservation program. 
    Subd. 4.  [ADVISORY COMMITTEE.] Before a city may make any 
loans under the housing preservation program, the city must 
establish an advisory committee to advise and assist the city in 
implementing the housing preservation program.  
    Sec. 10.  Minnesota Statutes 1988, section 462A.21, is 
amended by adding a subdivision to read: 
    Subd. 3a.  [CAPACITY BUILDING REVOLVING LOAN FUND.] It may 
establish a revolving loan fund for predevelopment costs for 
nonprofit organizations and local government units engaged in 
the construction or rehabilitation of low- and moderate-income 
housing, and for the purposes specified in sections 462A.05, 
subdivision 5; and 462A.07, subdivisions 2, 3, 3a, 5, 5a, 6, 7, 
11, and 16.  The agency may delegate the authority to administer 
the revolving loan fund for designated areas in the state to 
existing nonprofit organizations.  Nonprofit entities selected 
to exercise such delegated powers must have sufficient 
professional housing development expertise, as determined by the 
agency, to evaluate the economic feasibility of an applicant's 
proposed project.  Loans to nonprofit organizations or local 
government units under this subdivision may be made with or 
without interest as determined by the agency.  
    Sec. 11.  Minnesota Statutes 1988, section 462A.21, is 
amended by adding a subdivision to read: 
    Subd. 3b.  [CAPACITY BUILDING GRANTS.] It may make capacity 
building grants to nonprofit organizations, local government 
units, Indian tribes, and Indian tribal organizations to expand 
their capacity to provide affordable housing and housing-related 
services.  The grants may be used to assess housing needs and to 
develop and implement strategies to meet those needs, including 
the creation or preservation of affordable housing and the 
linking of supportive services to the housing.  The agency shall 
adopt rules specifying the eligible uses of grant money.  
Funding priority must be given to those applicants that include 
low-income persons in their membership, have provided 
housing-related services to low-income people, and demonstrate a 
local commitment of local resources, which may include in-kind 
contributions.  Grants under this subdivision may be made only 
with specific appropriations by the legislature. 
    Sec. 12.  Minnesota Statutes 1988, section 462A.21, 
subdivision 4k, is amended to read: 
    Subd. 4k.  [HOUSING DEVELOPMENT FUND.] The agency may make 
grants for residential housing for low-income persons under 
section 462A.05, subdivision 28, from funds specifically 
appropriated by the legislature for that purpose and may pay the 
costs and expenses for the development and operation of the 
program. 
    Sec. 13.  Minnesota Statutes 1988, section 462A.21, is 
amended by adding a subdivision to read: 
    Subd. 8b.  [FAMILY RENTAL HOUSING.] It may establish a 
family rental housing assistance program to provide loans or 
direct rental subsidies for housing for families with incomes of 
up to 60 percent of area median income.  Priority must be given 
to those developments with resident families with the lowest 
income.  The development may be financed by the agency or other 
public or private lenders.  Direct rental subsidies must be 
administered by the agency for the benefit of eligible 
families.  Financial assistance provided under this subdivision 
to recipients of aid to families with dependent children must be 
in the form of vendor payments whenever possible.  Loans and 
direct rental subsidies under this subdivision may be made only 
with specific appropriations by the legislature. 
    Sec. 14.  Minnesota Statutes 1988, section 462A.21, is 
amended by adding a subdivision to read: 
    Subd. 8c.  [RENTAL HOUSING FOR INDIVIDUALS.] It may 
establish a rental housing assistance program for persons of low 
income or with a mental illness to provide loans or direct 
rental subsidies for housing for individuals with incomes of up 
to 30 percent of area median income.  Priority must be given to 
developments with the lowest income residents.  Housing for the 
mentally ill must be operated in coordination with social 
service providers who provide services to tenants.  The 
developments may be financed by the agency or other public or 
private entities.  Direct rental subsidies must be administered 
by the agency for the benefit of eligible tenants.  Financial 
assistance provided under this subdivision must be in the form 
of vendor payments whenever possible.  Loans and direct rental 
subsidies under this subdivision may be made only with specific 
appropriations by the legislature. 
    Sec. 15.  Minnesota Statutes 1988, section 462A.21, 
subdivision 12, is amended to read: 
    Subd. 12.  [TEMPORARY HOUSING.] It may make loans or grants 
for the purpose of section 462A.05, subdivision 20, and may pay 
the costs and expenses necessary and incidental to the loan or 
grant program authorized therein.  Grants pursuant to section 
462A.05, subdivision 20 may be made only with specific 
appropriations by the legislature.  
    Sec. 16.  Minnesota Statutes 1988, section 462A.21, is 
amended by adding a subdivision to read: 
    Subd. 12a.  [PROGRAM MONEY TRANSFER.] Grants authorized 
under section 462A.05, subdivisions 20, 28, and 29, may be made 
only with specific appropriations by the legislature, but 
unencumbered balances of money appropriated for the purpose of 
loans or grants for agency programs under these subdivisions may 
be transferred between programs created by these subdivisions or 
in accordance with section 462A.20, subdivision 3. 
    Sec. 17.  Minnesota Statutes 1988, section 462A.21, is 
amended by adding a subdivision to read: 
    Subd. 15.  [RURAL AND URBAN HOMESTEADING PROGRAM.] It may 
make grants to eligible organizations for the Minnesota rural 
and urban homesteading program under section 8 and may pay the 
costs and expenses necessary and incidental to the grant program.
    Sec. 18.  [462A.28] [HOME EQUITY CONVERSION LOAN COUNSELING 
PROGRAM.] 
    Subdivision 1.  [PROGRAM ADMINISTRATION.] The agency shall 
select and contract with a nonprofit corporation to administer a 
home equity conversion loan counseling program for senior 
homeowners.  The organization selected must meet the following 
requirements: 
    (1) its primary purpose is to assist elderly persons in 
obtaining and maintaining affordable housing; 
    (2) it is knowledgeable about reverse mortgage programs; 
    (3) it has experience in counseling older persons on 
housing, including knowledge of alternative living arrangements 
for older persons; and 
    (4) it has knowledge of existing public support programs 
for older persons. 
    Subd. 2.  [PROGRAM RESPONSIBILITIES.] The organization 
selected to administer the counseling program in subdivision 1 
must perform the following program responsibilities with program 
clients: 
    (1) conduct a review of reverse mortgage programs, 
including the advantages, disadvantages, and alternatives; 
    (2) explain the effects of the mortgage on the client's 
estate and public benefits; 
    (3) explain the lending process; and 
    (4) discuss the client's supplemental income needs. 
    Sec. 19.  [STATEWIDE FUNDING ALLOCATION.] 
    The Minnesota housing finance agency shall ensure that 
money appropriated for rental housing is distributed statewide 
and that within the seven-county metropolitan area, the area 
outside of the cities of Minneapolis and St. Paul receive an 
equitable distribution of the allocation.  
    Sec. 20.  [MINNESOTA RURAL AND URBAN HOMESTEADING PROGRAM 
PILOT PROJECT.] 
    The Minnesota housing finance agency may award up to two 
pilot project grants under the rural and urban homesteading 
program.  The agency may not award more than one pilot project 
grant in a county.  
    Sec. 21.  [REPEALER.] 
    Minnesota Statutes 1988, section 474A.081, subdivision 3, 
is repealed.  
     Sec. 22.  [EFFECTIVE DATE.] 
     Section 1 is effective the day following final enactment.  

                               ARTICLE 2 

                       LANDLORD-TENANT PROVISIONS 
    Section 1.  Minnesota Statutes 1988, section 504.255, is 
amended to read: 
    504.255 [UNLAWFUL OUSTER OR EXCLUSION; DAMAGES.] 
    If a landlord, an agent, or other person acting under the 
landlord's direction or control, unlawfully and in bad faith 
removes or, excludes, or forcibly keeps out a tenant from a 
residential premises, the tenant may recover from the landlord 
up to treble damages or $500, whichever is greater, and 
reasonable attorney's fees.  
    Sec. 2.  Minnesota Statutes 1988, section 504.26, is 
amended to read: 
    504.26 [UNLAWFUL TERMINATION OF UTILITIES.] 
    Except as otherwise provided in this subdivision section, 
if a landlord, an agent or other person acting under the 
landlord's direction or control, interrupts or causes the 
interruption of electricity, heat, gas, or water services to the 
tenant, the tenant may recover from the landlord treble 
damages or $500, whichever is greater, and reasonable attorney's 
fees.  It is a defense to any action brought under 
this subdivision section that the interruption was the result of 
the deliberate or negligent act or omission of a tenant or 
anyone acting under the direction or control of the tenant.  The 
tenant may recover only actual damages under this 
subdivision section if: 
    (a) the tenant has not given the landlord, an agent or 
other person acting under the landlord's direction or control, 
notice of the interruption; or 
    (b) the landlord, an agent or other person acting under the 
landlord's direction or control, after receiving notice of the 
interruption from the tenant and within a reasonable period of 
time after the interruption, taking into account the nature of 
the service interrupted and the effect of the interrupted 
service on the health, welfare and safety of the tenants, has 
reinstated or made a good faith effort to reinstate the service 
or has taken other remedial action; or 
    (c) the interruption was for the purpose of repairing or 
correcting faulty or defective equipment or protecting the 
health and safety of the occupants of the premises involved and 
the service was reinstated or a good faith effort was made to 
reinstate the service or other remedial action was taken by the 
landlord, an agent, or other person acting under the landlord's 
direction or control within a reasonable period of time, taking 
into account the nature of the defect, the nature of the service 
interrupted and the effect of the interrupted service on the 
health, welfare and safety of the tenants.  
    Sec. 3.  [504.29] [DEFINITIONS.] 
    Subdivision 1.  [APPLICABILITY.] The definitions in this 
section apply to sections 3 to 5. 
    Subd. 2.  [OWNER.] "Owner" has the meaning given it in 
section 566.18, subdivision 3. 
    Subd. 3.  [TENANT.] "Tenant" has the meaning given it in 
section 566.18, subdivision 2. 
    Subd. 4.  [TENANT REPORT.] "Tenant report" means a written, 
oral, or other communication by a tenant screening service that 
includes information concerning an individual's credit 
worthiness, credit standing, credit capacity, character, general 
reputation, personal characteristics, or mode of living, and 
that is collected, used, or expected to be used for the purpose 
of making decisions relating to residential tenancies or 
residential tenancy applications. 
    Subd. 5.  [TENANT SCREENING SERVICE.] "Tenant screening 
service" means a person or business regularly engaged in the 
practice of gathering, storing, or disseminating information 
about tenants or assembling tenant reports for monetary fees, 
dues, or on a cooperative nonprofit basis.  
    Sec. 4.  [504.30] [TENANT REPORTS; DISCLOSURE AND 
CORRECTIONS.] 
    Subdivision 1.  [DISCLOSURES REQUIRED.] Upon request and 
proper identification, a tenant screening service must disclose 
the following information to an individual: 
    (1) the nature and substance of all information in its 
files on the individual at the time of the request; and 
    (2) the sources of the information. 
    A tenant screening service must make the disclosures to an 
individual without charge if information in a tenant report has 
been used within the past 30 days to deny the rental or increase 
the security deposit or rent of a residential housing unit to 
the individual.  If the tenant report has not been used to deny 
the rental or increase the rent or security deposit of a 
residential housing unit within the past 30 days, the tenant 
screening service may impose a reasonable charge for making the 
disclosure required under this section.  The tenant screening 
service must notify the tenant of the amount of the charge 
before furnishing the information.  The charge may not exceed 
the amount that the tenant screening service would impose on 
each designated recipient of a tenant report, except that no 
charge may be made for notifying persons of the deletion of 
information which is found to be inaccurate or which can no 
longer be verified. 
    Subd. 2.  [CORRECTIONS.] If the completeness or accuracy of 
an item of information contained in an individual's file is 
disputed by the individual, the tenant screening service must 
reinvestigate and record the current status of the information.  
If the information is found to be inaccurate or can no longer be 
verified, the tenant screening service must delete the 
information from the individual's file and tenant report.  At 
the request of the individual, the tenant screening service must 
give notification of the deletions to persons who have received 
the tenant report within the past six months.  
    Subd. 3.  [EXPLANATIONS.] The tenant screening service must 
permit an individual to explain any disputed item not resolved 
by reinvestigation in a tenant report.  The explanation must be 
included in the tenant report.  The tenant screening service may 
limit the explanation to no more than 100 words.  
    Subd. 4.  [COURT FILE INFORMATION.] If a tenant screening 
service includes information from a court file on an individual 
in a tenant report, the outcome of the court proceeding must be 
accurately recorded in the tenant report, unless the outcome is 
not provided by the court.  Whenever the court supplies 
information from a court file on an individual, in whatever 
form, the court shall include information on the outcome of the 
court proceeding when it is available.  The tenant screening 
service is not liable under section 5 if the tenant screening 
service reports complete and accurate information as provided by 
the court. 
    Subd. 5.  [INFORMATION TO TENANT.] If the owner uses 
information in a tenant report to deny the rental or increase 
the security deposit or rent of a residential housing unit, the 
owner must inform the prospective tenant of the name and address 
of the tenant screening service that provided the tenant report. 
    Sec. 5.  [504.31] [TENANT REPORT; REMEDIES.] 
    The remedies provided in section 8.31 apply to a violation 
of section 4.  A tenant screening service or owner in compliance 
with the provisions of the Fair Credit Reporting Act, United 
States Code, title 15, section 1681, et seq., is considered to 
be in compliance with section 4. 
    Sec. 6.  [504.32] [NOTICE REQUIREMENT.] 
    Subdivision 1.  [DEFINITIONS.] The definitions of "owner" 
and "tenant" in section 566.18 apply to this section. 
    Subd. 2.  [NOTICE.] The owner of federally subsidized 
rental housing must give tenants a one-year written notice under 
the following conditions: 
    (1) a federal section 8 contract will expire; 
    (2) the owner will exercise the option to terminate or not 
renew a federal section 8 contract and mortgage; 
    (3) the owner will prepay a mortgage and the prepayment 
will result in the termination of any federal use restrictions 
that apply to the housing; or 
    (4) the owner will terminate a housing subsidy program. 
    The notice shall be provided at the commencement of the 
lease if the lease commences less than one year before any of 
the above conditions apply. 
    Sec. 7.  Minnesota Statutes 1988, section 566.17, is 
amended to read: 
    566.17 [EXECUTION OF THE WRIT OF RESTITUTION.] 
    Subdivision 1.  [GENERAL.] The officer holding the writ of 
restitution shall execute the same by making a demand upon 
defendant if found in the county or any adult member of the 
defendant's family holding possession of the premises, or other 
person in charge thereof, for the possession of the same, and 
that the defendant leave, taking family and all personal 
property from such premises within 24 hours after such demand.  
If defendant fails to comply with the demand, then the officer 
shall bring, if necessary, the force of the county and whatever 
assistance may be necessary, at the cost of the complainant, 
remove the said defendant, family and all personal property from 
said premises detained, immediately and place the plaintiff in 
the possession thereof.  In case defendant cannot be found in 
the county, and there is no person in charge of the premises 
detained, so that no demand can be made upon the defendant, then 
the officer shall enter into the possession of the premises, 
breaking in if necessary, and the property of the defendant 
shall be removed and stored at a place designated by the 
plaintiff as provided under subdivision 2. 
    Subd. 2.  [REMOVAL AND STORAGE OF PROPERTY.] (a) In cases 
where the defendant's personal property is to be stored in a 
place other than the premises, the officer shall remove all 
property of the defendant at the expense of the plaintiff.  
    The plaintiff shall have a lien upon all of the goods upon 
the premises for the reasonable costs and expenses incurred for 
removing the personal property and for the proper caring and 
storing the same, and the costs of transportation of the same to 
some suitable place of storage, in case defendant shall fail or 
refuse to make immediate payment for all the expenses of such 
removal from the premises and plaintiff shall have the right to 
enforce such lien by detaining the same until paid, and, in case 
of nonpayment for 60 days after the execution of the writ, shall 
have the right to enforce the lien and foreclose the same by 
public sale as provided for in case of sales under sections 
514.18 to 514.22. 
    (b) In cases where the defendant's property is to be stored 
on the premises, the officer shall enter the premises, breaking 
in if necessary, and the plaintiff may remove the defendant's 
personal property.  The provisions of section 504.24 apply to 
property removed under this paragraph.  The plaintiff must 
prepare an inventory and mail a copy of the inventory to the 
defendant's last known address or, if the defendant has provided 
a different address, to the address provided by the defendant.  
The inventory must be prepared, signed, and dated in the 
presence of the peace officer.  The inventory must include the 
following: 
    (1) a listing of the items of personal property and a 
description of the condition of the property; 
    (2) the date, the signature of the plaintiff or the 
plaintiff's agent, and the name and telephone number of a person 
authorized to release the personal property; and 
    (3) the name and badge number of the peace officer. 
    The peace officer shall retain a copy of the inventory.  
The plaintiff is responsible for the proper removal, storage, 
and care of the defendant's personal property and is liable for 
damages for loss of or injury to the defendant's personal 
property caused by the plaintiff's failure to exercise care in 
regard to it as a reasonably careful person would exercise under 
like circumstances. 
    The plaintiff shall notify the defendant of the date and 
approximate time the officer is scheduled to remove the 
defendant, family, and the defendant's personal property from 
the premises.  The notice must be sent by first-class mail.  In 
addition, the plaintiff must make a good faith effort to notify 
the defendant by telephone.  The notice must be mailed as soon 
as the information regarding the date and approximate time the 
officer is scheduled to enforce the writ is known to the 
plaintiff, except that the scheduling of the peace officer to 
enforce the writ need not be delayed because of the notice 
requirement.  The notice must inform the defendant that the 
defendant and the defendant's property will be removed from the 
premises if the defendant has not vacated the premises by the 
time specified in the notice. 
    Subd. 3.  [PENALTY; WAIVER PROHIBITED.] Unless the premises 
have been abandoned, a plaintiff, agent, or other person acting 
under the plaintiff's direction or control who enters the 
premises and removes the defendant's property in violation of 
this section is guilty of wrongful ouster under section 504.255 
and is subject to penalty under section 504.25.  The provisions 
of this section may not be waived or modified by any oral or 
written lease or other agreement. 
    Sec. 8.  Minnesota Statutes 1988, section 566.175, 
subdivision 1, is amended to read: 
    Subdivision 1.  [UNLAWFUL EXCLUSION OR REMOVAL.] For 
purposes of this section, "unlawfully removed or excluded" means 
actual or constructive removal or exclusion.  Actual or 
constructive removal or exclusion may include the termination of 
utilities, or the removal of doors, windows, or locks.  Any 
tenant who is unlawfully removed or excluded from lands or 
tenements which are demised or let to the tenant may recover 
possession of the premises in the following manner: 
    (a) The tenant shall present a verified petition to the 
county or municipal court of the county in which the premises 
are located, which petition shall: 
    (1) describe the premises of which possession is claimed 
and the owner, as defined in section 566.18, subdivision 3, of 
the premises; 
    (2) specifically state the facts and grounds that 
demonstrate that the removal or exclusion was unlawful including 
a statement that no judgment and writ of restitution have been 
issued under section 566.09 in favor of the owner and against 
petitioner as to the premises and executed in accordance with 
section 566.17; and 
    (3) ask for possession thereof.  
    (b) If it clearly appears from the specific grounds and 
facts stated in the verified petition or by separate affidavit 
of petitioner or the petitioner's counsel or agent that the 
removal or exclusion was unlawful, the court shall immediately 
order that petitioner have possession of the premises.  
    (c) The petitioner shall furnish monetary or other security 
if any as the court deems appropriate under the circumstances 
for payment of all costs and damages the defendant may sustain 
if the order is subsequently found to have been obtained 
wrongfully.  In determining the appropriateness of any security 
the court shall consider petitioner's ability to afford monetary 
security.  
    (d) The court shall direct the order to the sheriff or any 
constable of the county in which the premises is located and the 
sheriff or constable shall execute the order immediately by 
making a demand upon the defendant, if found, or the defendant's 
agent or other person in charge of the premises, for possession 
of the premises.  If the defendant fails to comply with the 
demand, the officer shall take whatever assistance may be 
necessary and immediately place the petitioner in possession of 
the premises.  If the defendant or the defendant's agent or 
other person in control of the premises cannot be found and if 
there is no person in charge of the premises detained so that no 
demand can be made, the officer shall immediately enter into 
possession of the premises and place the petitioner in 
possession of the premises.  The officer shall also serve the 
order and verified petition or affidavit without delay upon the 
defendant or agent, in the same manner as a summons is required 
to be served in a civil action in district court.  
    Sec. 9.  Minnesota Statutes 1988, section 566.29, 
subdivision 1, is amended to read: 
    Subdivision 1.  [ADMINISTRATOR.] The administrator may be 
any a person, local government unit or agency, other than an 
owner of the building, the inspector, the complaining tenant or 
any person living in the complaining tenant's dwelling unit.  If 
a state, or court, or local agency is authorized by statute, 
ordinance or regulation to provide persons to act as 
administrators under this section, the court may appoint such 
persons as administrators to the extent they are available.  
    Sec. 10.  Minnesota Statutes 1988, section 566.29, 
subdivision 4, is amended to read: 
    Subd. 4.  [POWERS.] The administrator shall be empowered is 
authorized to: 
    (a) Collect rents from tenants and commercial tenants, 
evict tenants and commercial tenants for nonpayment of rent or 
other cause, rent vacant dwelling units on a month to month 
basis, rent vacant commercial units with the consent of the 
owner and exercise all other powers necessary and appropriate to 
carry out the purposes of Laws 1973, chapter 611; 
    (b) Contract for the reasonable cost of materials, labor 
and services necessary to remedy the violation or violations 
found by the court to exist and for the rehabilitation of the 
property in order to maintain safe and habitable conditions over 
the useful life of the property, and make disbursements for 
payment therefor from funds available for the purpose; 
    (c) Provide any services to the tenants which the owner is 
obligated to provide but refuses or fails to provide, and pay 
for them from funds available for the purpose; 
    (d) Petition the court, after notice to the parties, for an 
order allowing the administrator to encumber the premise to 
secure funds to the extent necessary to cover the cost of 
materials, labor, and services necessary to remedy the violation 
or violations found by the court to exist and for rehabilitation 
of the property in order to maintain safe and habitable 
conditions over the useful life of the property, and to pay for 
them from funds derived from the encumbrance; and 
    (e) Petition the court, after notice to the parties, for an 
order allowing the administrator to receive funds made available 
for this purpose by the municipality to the extent necessary to 
cover the cost of materials, labor, and services necessary to 
remedy the violation or violations found by the court to 
exist and for rehabilitation of the property in order to 
maintain safe and habitable conditions over the useful life of 
the property, and pay for them from funds derived from the 
municipal sources.  The municipality shall recover disbursements 
by special assessment on the real estate affected, bearing 
interest at the rate determined by the municipality, not 
exceeding the rate established for finance charges for open-end 
credit sales under section 334.16, subdivision 1, clause (b), 
with the assessment, interest and any penalties to be collected 
the same as special assessments made for other purposes under 
state statute or municipal charter. 
    Sec. 11.  Minnesota Statutes 1988, section 566.29, is 
amended by adding a subdivision to read: 
    Subd. 6.  [BUILDING REPAIRS AND SERVICES.] The 
administrator must first contract and pay for building repairs 
and services necessary to keep the building habitable before 
other expenses may be paid.  If sufficient funds are not 
available for paying other expenses, such as tax and mortgage 
payments, after paying for necessary repairs and services, the 
owner is responsible for the other expenses. 
    Sec. 12.  Minnesota Statutes 1988, section 566.29, is 
amended by adding a subdivision to read: 
    Subd. 7.  [ADMINISTRATOR'S LIABILITY.] The administrator 
may not be held personally liable in the performance of duties 
under this section except for misfeasance, malfeasance, or 
nonfeasance of office. 
    Sec. 13.  Minnesota Statutes 1988, section 566.29, is 
amended by adding a subdivision to read: 
    Subd. 8.  [DWELLING'S ECONOMIC VIABILITY.] In considering 
whether to grant the administrator funds under subdivision 4, 
the court must consider factors relating to the long-term 
economic viability of the dwelling.  The court's analysis must 
consider factors including the causes leading to the appointment 
of an administrator, the repairs necessary to bring the property 
into code compliance, the market value of the property, and 
whether present and future rents will be sufficient to cover the 
cost of repairs or rehabilitation. 
    Sec. 14.  [566.291] [RECEIVERSHIP REVOLVING LOAN FUND.] 
    The Minnesota housing finance agency may establish a 
revolving loan fund to pay the administrative expenses of 
receivership administrators under section 566.29 for properties 
for occupancy by low- and moderate-income persons or families.  
Property owners are responsible for repaying administrative 
expense payments made from the fund. 
    Sec. 15.  [566.34] [ESCROW OF RENT TO REMEDY VIOLATIONS.] 
    Subdivision 1.  [DEFINITIONS.] The definitions in section 
566.18 apply to this section. 
    Subd. 2.  [ESCROW OF RENT.] If a violation exists in a 
building, a tenant may deposit the amount of rent due to the 
owner with the court administrator using the following procedure:
    (a) For a violation of section 566.18, subdivision 6, 
clause (a), the tenant may deposit with the court administrator 
the rent due the owner along with a copy of the written notice 
of the code violation as provided in section 566.19, subdivision 
2.  The tenant may not deposit the rent or file the written 
notice of the code violation until the time granted to make 
repairs has expired without satisfactory repairs being made, 
unless the tenant alleges that the time granted is excessive. 
    (b) For a violation of section 566.18, subdivision 6, 
clause (b) or (c), the tenant must give written notice to the 
owner specifying the violation.  The notice must be delivered 
personally or sent to the person or place where rent is normally 
paid.  If the violation is not corrected within 14 days, the 
tenant may deposit the amount of rent due to the owner with the 
court administrator along with an affidavit specifying the 
violation.  The court must provide a simplified form affidavit 
for use under this clause. 
    As long as proceedings are pending under this section, the 
tenant must pay rent to the owner or as directed by the court 
and may not withhold rent to remedy a violation. 
    Subd. 3.  [COUNTERCLAIM FOR POSSESSION.] The owner may file 
a counterclaim for possession of the premises in cases where the 
owner alleges that the tenant did not deposit the full amount of 
rent with the court administrator.  The court must set the date 
for a hearing on the counterclaim not less than seven nor more 
than 14 days from the day of filing the counterclaim.  If the 
rent escrow hearing and the hearing on the counterclaim for 
possession cannot be heard on the same day, the matters must be 
consolidated and heard on the date scheduled for the hearing on 
the counterclaim.  The contents of the counterclaim for 
possession must meet the requirements for a complaint in 
unlawful detainer under section 566.05.  The owner must serve 
the counterclaim as provided in section 566.06, except that the 
affidavits of service or mailing may be brought to the hearing 
rather than filed with the court before the hearing.  The court 
must provide a simplified form for use under this section. 
     Subd. 4.  [DEFENSES.] The defenses provided in section 
566.23 are defenses to an action brought under this section. 
    Subd. 5.  [FILING FEE.] The court administrator may charge 
a filing fee in the amount set for complaints and counterclaims 
in conciliation court, subject to the filing of an inability to 
pay affidavit.  
    Subd. 6.  [NOTICE OF HEARING.] A hearing must be held 
within ten to 14 days of the day a tenant deposits rent with the 
court administrator.  If the cost of remedying the violation, as 
estimated by the tenant, is within the jurisdictional limit for 
conciliation court, the court administrator shall notify the 
owner and the tenant of the time and place of the hearing by 
first class mail.  The tenant must provide the court 
administrator with the owner's name and address.  If the owner 
has disclosed a post office box as the owner's address under 
section 504.22, notice of the hearing may be mailed to the post 
office box.  If the cost of remedying the violation, as 
estimated by the tenant, is above the jurisdictional limit for 
conciliation court, the tenant must serve the notice of hearing 
according to the rules of civil procedure.  The notice of 
hearing must specify the amount the tenant has deposited with 
the court administrator, and must inform the owner that 
possession of the premises will not be in issue at the hearing 
unless the owner files a counterclaim for possession or an 
action under sections 566.01 to 566.17.  
    Subd. 7.  [HEARING.] The hearing shall be conducted by a 
court without a jury.  A certified copy of an inspection report 
meets the requirements of rule 803(8) of the Rules of Evidence 
as an exception to the rule against hearsay, and meets the 
requirements of rules 901 and 902 of the Rules of Evidence as to 
authentication. 
    Subd. 8.  [RELEASE OF RENT PRIOR TO HEARING.] If the tenant 
gives written notice to the court administrator that the 
violation has been remedied, the court administrator must 
release the rent to the owner and, unless the hearing has been 
consolidated with another action, must cancel the hearing.  If 
the tenant and the owner enter into a written agreement signed 
by both parties apportioning the rent between them, the court 
administrator must release the rent in accordance with the 
written agreement and cancel the hearing. 
    Subd. 9.  [CONSOLIDATION WITH UNLAWFUL DETAINER.] Actions 
under this section and actions in unlawful detainer brought 
under sections 566.01 to 566.17 which involve the same parties 
must be consolidated and heard on the date scheduled for the 
unlawful detainer. 
    Subd. 10.  [JUDGMENT.] (a) Upon finding that a violation 
exists, the court may, in its discretion, do any or all of the 
following: 
    (1) order relief as provided in section 566.25, including 
retroactive rent abatement; 
    (2) order that all or a portion of the rent in escrow be 
released for the purpose of remedying the violation; 
    (3) order that rent be deposited with the court as it 
becomes due to the owner or abate future rent until the owner 
remedies the violation; or 
    (4) impose fines as required in section 16. 
    (b) When a proceeding under this section has been 
consolidated with a counterclaim for possession or an action in 
unlawful detainer under sections 566.01 to 566.17, and the owner 
prevails, the tenant may redeem the tenancy as provided in 
section 504.02. 
    (c) When a proceeding under this section has been 
consolidated with a counterclaim for possession or an action 
under an unlawful detainer under sections 566.01 to 566.17 on 
the grounds of nonpayment, the court may not require the tenant 
to pay the owner's filing fee as a condition of retaining 
possession of the premises when the tenant has deposited with 
the court the full amount of money found by the court to be owed 
to the owner. 
    Subd. 11.  [RELEASE OF RENT AFTER HEARING.] Upon finding, 
after a hearing on the matter has been held, that no violation 
exists in the building or that the tenant did not deposit the 
full amount of rent due with the court administrator, the court 
shall order the immediate release of the rent to the owner.  
Upon finding that a violation existed, but was remedied between 
the commencement of the action and the hearing, the court may 
order rent abatement and must release the rent to the parties 
accordingly.  Any rent found to be owed to the tenant must be 
released to the tenant.  
    Subd. 12.  [RETALIATION; WAIVER; RIGHTS AS ADDITIONAL.] The 
provisions of section 566.28 apply to proceedings under this 
section.  The tenant rights under this section may not be waived 
or modified and are in addition to and do not limit other rights 
or remedies which may be available to the tenant and owner, 
except as provided in subdivision 2. 
    Sec. 16.  [566.35] [VIOLATIONS OF BUILDING REPAIR ORDERS.] 
    Subdivision 1.  [NONCOMPLIANCE; FINES.] Upon finding an 
owner has willfully failed to comply with a court order to 
remedy a violation, the court shall fine the owner according to 
the following schedule:  
    (1) $250 for the first failure to comply; 
    (2) $500 for the second failure to comply with an order 
regarding the same violation; and 
    (3) $750 for the third and each subsequent failure to 
comply with an order regarding the same violation.  
    Subd. 2.  [CRIMINAL PENALTY.] An owner who willfully fails 
to comply with a court order to remedy a violation is guilty of 
a gross misdemeanor if it is the third or subsequent time that 
the owner has willfully failed to comply with an order to remedy 
a violation within a three-year period. 
    Subd. 3.  [FINES COLLECTED.] Fines collected under 
subdivision 1 in Hennepin county must be used for expenses of 
the fourth judicial district, housing calendar consolidation 
project.  Fines collected under subdivision 1 in Ramsey county 
must be used for expenses of the second judicial district, 
housing calendar consolidation project. 
    Sec. 17.  [HOUSING CALENDAR CONSOLIDATION PILOT PROJECT.] 
    Subdivision 1.  [ESTABLISHMENT.] A three-year pilot project 
may be established in the second and fourth judicial districts 
to consolidate the hearing and determination of matters related 
to residential rental housing and to ensure continuity and 
consistency in the disposition of cases. 
    Subd. 2.  [JURISDICTION.] The housing calendar project may 
consolidate the hearing and determination of all proceedings 
under Minnesota Statutes, chapters 504 and 566; criminal and 
civil proceedings related to violations of any state, county or 
city health, safety, housing, building, fire prevention or 
housing maintenance code; escrow of rent proceedings; 
landlord-tenant damage actions; and actions for rent and rent 
abatement.  A proceeding under sections 566.01 to 566.17 may not 
be delayed because of the consolidation of matters under the 
housing calendar project.  
    Subd. 3.  [REFEREE.] The chief judge of district court may 
appoint a referee for the housing calendar project.  The referee 
must be learned in the law.  The referee must be compensated 
according to the same scale used for other referees in the 
district court.  Minnesota Statutes, section 484.70, subdivision 
6, applies to the housing calendar project. 
    Subd. 4.  [REFEREE DUTIES.] The duties and powers of the 
referee in the housing calendar project are as follows: 
    (1) to hear and report all matters within the jurisdiction 
of the housing calendar project and as may be directed to the 
referee by the chief judge; and 
    (2) to recommend findings of fact, conclusions of law, 
temporary and interim orders, and final orders for judgment. 
    All recommended orders and findings of the referee are 
subject to confirmation by a judge. 
    Subd. 5.  [TRANSMITTAL OF COURT FILE.] Upon the conclusion 
of the hearing in each case, the referee must transmit to the 
district court judge, the court file together with the referee's 
recommended findings and orders in writing.  The recommended 
findings and orders of the referee become the findings and 
orders of the court when confirmed by the district court judge.  
The order of the court is proof of the confirmation. 
    Subd. 6.  [CONFIRMATION OF REFEREE ORDERS.] Review of any 
recommended order or finding of the referee by a district court 
judge may be had by notice served and filed within ten days of 
effective notice of the recommended order or finding.  The 
notice of review must specify the grounds for the review and the 
specific provisions of the recommended findings or orders 
disputed, and the district court judge, upon receipt of the 
notice of review, must set a time and place for the review 
hearing. 
    Subd. 7.  [PROCEDURES.] The chief judge of the district 
must establish procedures for the implementation of the pilot 
project, including designation of a location for the hearings.  
The chief judge may also appoint other staff as necessary for 
the project. 
    Subd. 8.  [EVALUATION.] The state court administrator may 
establish a procedure in consultation with the chief judge of 
each district, each district administrator, and an advisory 
group for evaluating the efficiency and the effectiveness of 
consolidating the hearing of residential rental housing matters, 
and must report to the legislature by January 1, 1992.  An 
advisory group, appointed by the state court administrator, may 
be established to provide ongoing oversight and evaluation of 
the housing calendar consolidation project.  The advisory group 
must include representatives of the second and fourth judicial 
districts and must be composed of at least one representative 
from each of the following groups:  the state court 
administrator's office; the district court administrator's 
office; the district judges; owners of rental property; and 
tenants. 
    Sec. 18.  [DEMONSTRATION PROJECTS.] 
    The establishment of a housing calendar project under 
section 17 is a demonstration project to evaluate the 
effectiveness of coordinating the adjudication of all 
housing-related cases in one court.  
    Sec. 19.  [REPEALER.] 
    Sections 16, subdivision 3; 17; and 18 are repealed July 1, 
1992. 

                               ARTICLE 3 

                             MISCELLANEOUS 
    Section 1.  [363.032] [AFFIRMATIVE MARKETING REGULATIONS.] 
    To promote and encourage open housing policies, the 
commissioner must establish affirmative marketing regulations 
for housing developers that receive more than $50,000 in state 
or local funds.  The regulations must require the management or 
marketing agency for the housing development to adopt an 
information distribution or marketing plan for actively 
informing minorities and other protected groups of available 
housing opportunities.  For purposes of this subdivision, 
"protected groups" has the meaning given it in section 43A.02, 
subdivision 33.  The commissioner may adopt rules to carry out 
the purposes of this section. 
    Sec. 2.  [363.033] [RENTAL HOUSING PRIORITY; ACCESSIBLE 
UNITS.] 
    Subdivision 1.  [DEFINITIONS.] The definitions in this 
subdivision apply to this section. 
    (a) "Accessible unit" means an accessible rental housing 
unit that meets the handicapped facility requirements of the 
state building code, Minnesota Rules, chapter 1340. 
    (b) "Owner" has the meaning given it in section 566.18, 
subdivision 3. 
    Subd. 2.  [PRIORITY REQUIREMENT.] (a) An owner of rental 
housing that contains accessible units must give priority for 
the rental of an accessible unit to a disabled person or a 
family with a disabled family member who will reside in the 
unit.  The owner must inform nondisabled persons and families 
that do not include a disabled family member of the possibility 
of being offered a non-handicapped-equipped unit as provided 
under this section before a rental agreement to rent an 
accessible unit is entered. 
    (b) If a nondisabled person or a family that does not 
include a disabled person is living in an accessible unit, the 
person or family must be offered a non-handicapped-equipped unit 
if the following conditions occur: 
    (1) a disabled person or a family with a disabled family 
member who will reside in the unit has signed a rental agreement 
to rent the accessible unit; and 
    (2) a similar non-handicapped-equipped unit in the same 
rental housing complex is available at the same rent. 
    Sec. 3.  Minnesota Statutes 1988, section 463.21, is 
amended to read: 
    463.21 [ENFORCEMENT OF JUDGMENT.] 
    If a judgment is not complied with in the time prescribed, 
the governing body may cause the building to be repaired, razed, 
or removed or the hazardous condition to be removed or corrected 
as set forth in the judgment, or acquire the building, if any, 
and real estate on which the building or hazardous condition is 
located by eminent domain as provided in section 463.152.  The 
cost of such the repairs, razing, correction, or removal shall 
may be:  a lien against the real estate on which the building is 
located or the hazardous condition exists and, or recovered by 
obtaining a judgment against the owner of the real estate on 
which the building is located or the hazardous condition 
exists.  A lien may be levied and collected only as a special 
assessment in the manner provided by Minnesota Statutes 1961, 
sections 429.061 to 429.081, but the assessment shall be is 
payable in a single installment.  When the building is razed or 
removed by the municipality, the governing body may sell the 
salvage and valuable materials at public auction upon three 
days' posted notice. 
    Sec. 4.  Minnesota Statutes 1988, section 469.007, is 
amended to read: 
    469.007 [POWERS OF COUNTY AND MULTICOUNTY AUTHORITIES.] 
    Subdivision 1.  [POWERS.] A county or multicounty authority 
and its commissioners shall, within the area of operation of the 
authority, have the same functions, rights, powers, duties, 
privileges, immunities, and limitations as are provided for 
housing and redevelopment authorities created for cities, and 
for the commissioners of those authorities.  The provisions of 
law applicable to housing and redevelopment authorities created 
for cities and their commissioners shall be applicable to county 
and multicounty authorities and their commissioners, except as 
clearly indicated otherwise.  
    Subd. 2.  [POWERS AS TO HOUSING DEVELOPMENT PROJECTS.] When 
a county or multicounty authority undertakes any housing project 
or housing development project involving the acquisition of 
multifamily housing rental properties that (1) were financed 
under the federal section 8 or section 236 programs, or (2) are 
designed to be affordable to persons or families with incomes 
not greater than 80 percent of median income for the 
metropolitan statistical area or nonmetropolitan county, and are 
located within any city or town, the authority shall notify the 
governing body of the city or town in writing of the location of 
the housing project or housing development project.  If the 
governing body fails to take action on a housing project or 
housing development project in a writing which sets forth its 
reasons for the action within 30 days, the governing body is 
considered to have approved the location of the housing project 
or housing development project for purposes of any special or 
general law requiring local approval of the location of housing 
projects and housing development projects undertaken by county 
or multicounty authorities. 
    Sec. 5.  Minnesota Statutes 1988, section 469.012, 
subdivision 1, is amended to read: 
    Subdivision 1.  [SCHEDULE OF POWERS.] An authority shall be 
a public body corporate and politic and shall have all the 
powers necessary or convenient to carry out the purposes of 
sections 469.001 to 469.047, except that the power to levy and 
collect taxes or special assessments is limited to the power 
provided in sections 469.027 to 469.033.  Its powers include the 
following powers in addition to others granted in sections 
469.001 to 469.047:  
    (1) to sue and be sued; to have a seal, which shall be 
judicially noticed, and to alter it; to have perpetual 
succession; and to make, amend, and repeal rules consistent with 
sections 469.001 to 469.047; 
    (2) to employ an executive director, technical experts, and 
officers, agents, and employees, permanent and temporary, that 
it requires, and determine their qualifications, duties, and 
compensation; for legal services it requires, to call upon the 
chief law officer of the city or to employ its own counsel and 
legal staff; so far as practicable, to use the services of local 
public bodies in its area of operation, provided that those 
local public bodies, if requested, shall make the services 
available; 
      (3) to delegate to one or more of its agents or employees 
the powers or duties it deems proper; 
      (4) within its area of operation, to undertake, prepare, 
carry out, and operate projects and to provide for the 
construction, reconstruction, improvement, extension, 
alteration, or repair of any project or part thereof; 
      (5) subject to the provisions of section 469.026, to give, 
sell, transfer, convey, or otherwise dispose of real or personal 
property or any interest therein and to execute leases, deeds, 
conveyances, negotiable instruments, purchase agreements, and 
other contracts or instruments, and take action that is 
necessary or convenient to carry out the purposes of these 
sections; 
      (6) within its area of operation, to acquire real or 
personal property or any interest therein by gifts, grant, 
purchase, exchange, lease, transfer, bequest, devise, or 
otherwise, and by the exercise of the power of eminent domain, 
in the manner provided by chapter 117, to acquire real property 
which it may deem necessary for its purposes, after the adoption 
by it of a resolution declaring that the acquisition of the real 
property is necessary to eliminate one or more of the conditions 
found to exist in the resolution adopted pursuant to section 
469.003 or to provide decent, safe, and sanitary housing for 
persons of low and moderate income, or is necessary to carry out 
a redevelopment project.  Real property needed or convenient for 
a project may be acquired by the authority for the project by 
condemnation pursuant to this section.  This includes any 
property devoted to a public use, whether or not held in trust, 
notwithstanding that the property may have been previously 
acquired by condemnation or is owned by a public utility 
corporation, because the public use in conformity with the 
provisions of sections 469.001 to 469.047 shall be deemed a 
superior public use.  Property devoted to a public use may be so 
acquired only if the governing body of the municipality has 
approved its acquisition by the authority.  An award of 
compensation shall not be increased by reason of any increase in 
the value of the real property caused by the assembly, clearance 
or reconstruction, or proposed assembly, clearance or 
reconstruction for the purposes of sections 469.001 to 469.047 
of the real property in an area; 
      (7) within its area of operation, and without the adoption 
of an urban renewal plan, to acquire, by all means as set forth 
in clause (6) but without the adoption of a resolution provided 
for in clause (6), real property, and to demolish, remove, 
rehabilitate, or reconstruct the buildings and improvements or 
construct new buildings and improvements thereon, or to so 
provide through other means as set forth in Laws 1974, chapter 
228, or to grade, fill, and construct foundations or otherwise 
prepare the site for improvements.  The authority may dispose of 
the property pursuant to section 469.029, provided that the 
provisions of section 469.029 requiring conformance to an urban 
renewal plan shall not apply.  The authority may finance these 
activities by means of the redevelopment project fund or by 
means of tax increments or tax increment bonds or by the methods 
of financing provided for in section 469.033 or by means of 
contributions from the municipality provided for in section 
469.041, clause (9), or by any combination of those means.  Real 
property with buildings or improvements thereon shall only be 
acquired under this clause when the buildings or improvements 
are substandard.  The exercise of the power of eminent domain 
under this clause shall be limited to real property which 
contains buildings and improvements which are vacated and 
substandard.  For the purpose of this clause, substandard 
buildings or improvements mean hazardous buildings as defined in 
section 463.15, subdivision 3, or buildings or improvements that 
are dilapidated or obsolescent, faultily designed, lack adequate 
ventilation, light, or sanitary facilities, or any combination 
of these or other factors that are detrimental to the safety or 
health of the community; 
      (8) within its area of operation, to determine the level of 
income constituting low or moderate family income.  The 
authority may establish various income levels for various family 
sizes.  In making its determination, the authority may consider 
income levels that may be established by the federal housing 
administration or a similar or successor federal agency for the 
purpose of federal loan guarantees or subsidies for persons of 
low or moderate income.  The authority may use that 
determination as a basis for the maximum amount of income for 
admissions to housing development projects or housing projects 
owned or operated by it; 
      (9) to provide in federally assisted projects any 
relocation payments and assistance necessary to comply with the 
requirements of the Federal Uniform Relocation Assistance and 
Real Property Acquisition Policies Act of 1970, and any 
amendments or supplements thereto; 
      (10) to make, or agree to make, payments in lieu of taxes 
to the city or the county, the state or any political 
subdivision thereof, that it finds consistent with the purposes 
of sections 469.001 to 469.047; 
      (11) to cooperate with or act as agent for the federal 
government, the state or any state public body, or any agency or 
instrumentality of the foregoing, in carrying out any of the 
provisions of sections 469.001 to 469.047 or of any other 
related federal, state, or local legislation; and upon the 
consent of the governing body of the city to purchase, lease, 
manage, or otherwise take over any housing project already owned 
and operated by the federal government; 
      (12) to make plans for carrying out a program of voluntary 
repair and rehabilitation of buildings and improvements, and 
plans for the enforcement of laws, codes, and regulations 
relating to the use of land and the use and occupancy of 
buildings and improvements, and to the compulsory repair, 
rehabilitation, demolition, or removal of buildings and 
improvements.  The authority may develop, test, and report 
methods and techniques, and carry out demonstrations and other 
activities for the prevention and elimination of slums and 
blight; 
      (13) to borrow money or other property and accept 
contributions, grants, gifts, services, or other assistance from 
the federal government, the state government, state public 
bodies, or from any other public or private sources; 
      (14) to include in any contract for financial assistance 
with the federal government any conditions that the federal 
government may attach to its financial aid of a project, not 
inconsistent with purposes of sections 469.001 to 469.047, 
including obligating itself (which obligation shall be 
specifically enforceable and not constitute a mortgage, 
notwithstanding any other laws) to convey to the federal 
government the project to which the contract relates upon the 
occurrence of a substantial default with respect to the 
covenants or conditions to which the authority is subject; to 
provide in the contract that, in case of such conveyance, the 
federal government may complete, operate, manage, lease, convey, 
or otherwise deal with the project until the defaults are cured 
if the federal government agrees in the contract to reconvey to 
the authority the project as then constituted when the defaults 
have been cured; 
      (15) to issue bonds for any of its corporate purposes and 
to secure the bonds by mortgages upon property held or to be 
held by it or by pledge of its revenues, including grants or 
contributions; 
     (16) to invest any funds held in reserves or sinking funds, 
or any funds not required for immediate disbursement, in 
property or securities in which savings banks may legally invest 
funds subject to their control or in the manner and subject to 
the conditions provided in section 475.66 for the deposit and 
investment of debt service funds; 
      (17) within its area of operation, to determine where 
blight exists or where there is unsafe, unsanitary, or 
overcrowded housing; 
      (18) to carry out studies of the housing and redevelopment 
needs within its area of operation and of the meeting of those 
needs.  This includes study of data on population and family 
groups and their distribution according to income groups, the 
amount and quality of available housing and its distribution 
according to rentals and sales prices, employment, wages, 
desirable patterns for land use and community growth, and other 
factors affecting the local housing and redevelopment needs and 
the meeting of those needs; to make the results of those studies 
and analyses available to the public and to building, housing, 
and supply industries; 
      (19) if a local public body does not have a planning agency 
or the planning agency has not produced a comprehensive or 
general community development plan, to make or cause to be made 
a plan to be used as a guide in the more detailed planning of 
housing and redevelopment areas; 
      (20) to lease or rent any dwellings, accommodations, lands, 
buildings, structures, or facilities included in any project 
and, subject to the limitations contained in sections 469.001 to 
469.047 with respect to the rental of dwellings in housing 
projects, to establish and revise the rents or charges therefor; 
      (21) to own, hold, and improve real or personal property 
and to sell, lease, exchange, transfer, assign, pledge, or 
dispose of any real or personal property or any interest 
therein; 
      (22) to insure or provide for the insurance of any real or 
personal property or operations of the authority against any 
risks or hazards; 
      (23) to procure or agree to the procurement of government 
insurance or guarantees of the payment of any bonds or parts 
thereof issued by an authority and to pay premiums on the 
insurance; 
      (24) to make expenditures necessary to carry out the 
purposes of sections 469.001 to 469.047; 
      (25) to enter into an agreement or agreements with any 
state public body to provide informational service and 
relocation assistance to families, individuals, business 
concerns, and nonprofit organizations displaced or to be 
displaced by the activities of any state public body; 
    (26) to compile and maintain a catalog of all vacant, open 
and undeveloped land, or land which contains substandard 
buildings and improvements as that term is defined in clause 
(7), that is owned or controlled by the authority or by the 
governing body within its area of operation and to compile and 
maintain a catalog of all authority owned real property that is 
in excess of the foreseeable needs of the authority, in order to 
determine and recommend if the real property compiled in either 
catalog is appropriate for disposal pursuant to the provisions 
of section 469.029, subdivisions 9 and 10; 
    (27) to recommend to the city concerning the enforcement of 
the applicable health, housing, building, fire prevention, and 
housing maintenance code requirements as they relate to 
residential dwelling structures that are being rehabilitated by 
low or moderate income persons pursuant to section 469.029, 
subdivision 9, for the period of time necessary to complete the 
rehabilitation, as determined by the authority; 
    (28) to recommend to the city the initiation of municipal 
powers, against certain real properties, relating to repair, 
closing, condemnation, or demolition of unsafe, unsanitary, 
hazardous, and unfit buildings, as provided in section 469.041, 
clause (5); and 
    (29) to sell, at private or public sale, at the price or 
prices determined by the authority, any note, mortgage, lease, 
sublease, lease purchase, or other instrument or obligation 
evidencing or securing a loan made for the purpose of economic 
development, job creation, redevelopment, or community 
revitalization by a public agency to a business, for-profit or 
nonprofit organization, or an individual.; and 
    (30) within its area of operation, to acquire and sell real 
property that is benefited by federal housing assistance 
payments, other rental subsidies, interest reduction payments, 
or interest reduction contracts for the purpose of preserving 
the affordability of low- and moderate-income multifamily 
housing.  
    Sec. 6.  Minnesota Statutes 1988, section 580.04, is 
amended to read: 
    580.04 [REQUISITES OF NOTICE.] 
    Each notice shall specify: 
    (1) The name of the mortgagor and of the mortgagee, and of 
the assignee of the mortgage, if any, and the original principal 
amount secured by said mortgage; 
    (2) The date of the mortgage, and when and where recorded, 
except where the mortgage is upon registered land, in which case 
the notice shall state that fact, and when and where registered; 
    (3) The amount claimed to be due thereon, and taxes, if 
any, paid by the mortgagee at the date of the notice; 
    (4) A description of the mortgaged premises, conforming 
substantially to that contained in the mortgage; 
    (5) The time and place of sale; and 
    (6) The time allowed by law for redemption by the 
mortgagor, the mortgagor's personal representatives or assigns.; 
and 
    (7) If the party foreclosing the mortgage desires to 
preserve the right to reduce the redemption period under section 
13 after the first publication of the notice, the notice must 
also state in capital letters:  "THE TIME ALLOWED BY LAW FOR 
REDEMPTION BY THE MORTGAGOR, THE MORTGAGOR'S PERSONAL 
REPRESENTATIVES OR ASSIGNS, MAY BE REDUCED TO FIVE WEEKS IF A 
JUDICIAL ORDER IS ENTERED UNDER MINNESOTA STATUTES, SECTION 
580.032, DETERMINING, AMONG OTHER THINGS, THAT THE MORTGAGED 
PREMISES ARE IMPROVED WITH A RESIDENTIAL DWELLING OF LESS THAN 
FIVE UNITS, ARE NOT PROPERTY USED IN AGRICULTURAL PRODUCTION, 
AND ARE ABANDONED." 
    Sec. 7.  Minnesota Statutes 1988, section 580.12, is 
amended to read: 
    580.12 [CERTIFICATE OF SALE; RECORD; EFFECT.] 
    When any sale of real property is made under a power of 
sale contained in any mortgage, the officer shall make and 
deliver to the purchaser a certificate, executed in the same 
manner as a conveyance, containing: 
    (1) A description of the mortgage; 
    (2) A description of the property sold; 
    (3) The price paid for each parcel sold; 
    (4) The time and place of the sale, and the name of the 
purchaser; and 
    (5) The time allowed by law for redemption.  The, provided 
that if the redemption period stated in the certificate is five 
weeks and a longer redemption period was stated in the published 
notice of foreclosure sale, a certified copy of the court order 
entered under section 13, authorizing reduction of the 
redemption period to five weeks, must be attached to the 
certificate.  
    A certificate which states a five-week redemption period 
must be recorded within ten days after the sale; any other 
certificate shall must be recorded within 20 days after such the 
sale, and.  When so recorded, upon expiration of the time for 
redemption, the certificate shall operate as a conveyance to the 
purchaser or the purchaser's assignee of all the right, title, 
and interest of the mortgagor in and to the premises named 
therein at the date of such mortgage, without any other 
conveyance. 
    Sec. 8.  Minnesota Statutes 1988, section 580.23, 
subdivision 1, is amended to read: 
    Subdivision 1.  When lands have been sold in conformity 
with the preceding sections of this chapter the mortgagor, the 
mortgagor's personal representatives or assigns, within six 
months after such sale, except as otherwise provided in 
subdivision 2 or section 13, may redeem such lands, as 
hereinafter provided, by paying the sum of money for which the 
same were sold, with interest from the time of sale at the rate 
provided to be paid on the mortgage debt and, if no rate be 
provided in the mortgage note, at the rate of six percent per 
annum, together with any further sums which may be 
payable pursuant to section as provided in sections 582.03 and 
section 12.  
    Sec. 9.  Minnesota Statutes 1988, section 580.24, is 
amended to read: 
    580.24 [REDEMPTION BY CREDITOR.] 
    If no such redemption be made by the mortgagor, the 
mortgagor's personal representatives or assigns, the senior 
creditor having a lien, legal or equitable, upon the mortgaged 
premises, or some part thereof, subsequent to the mortgage, may 
redeem within five days after the expiration of the redemption 
period specified in determined under section 580.23 or section 
13, whichever is applicable; and each subsequent creditor having 
a lien in succession, according to priority of liens, within 
five days after the time allowed the prior lienholder, 
respectively, may redeem by paying the amount aforesaid and all 
liens prior to the lienholder's own held by the person from whom 
redemption is made; provided that no creditor shall be entitled 
to redeem unless within the period allowed for redemption the 
creditor file for record notice of intention to redeem with the 
county recorder or registrar of titles of each county where the 
mortgage is recorded. 
    Sec. 10.  Minnesota Statutes 1988, section 581.10, is 
amended to read: 
    581.10 [REDEMPTION BY MORTGAGOR, CREDITOR.] 
    The mortgagor, or those claiming under the mortgagor, 
within the time specified in section 580.23 or section 13, 
whichever applies, after the date of the order of confirmation, 
may redeem the premises sold, or any separate portion thereof, 
by paying the amount bid therefor, with interest thereon from 
the time of sale at the rate provided to be paid on the mortgage 
debt, not to exceed eight percent per annum, and, if no rate to 
be provided in the mortgage, at the rate of six percent, 
together with any further sum which may be payable pursuant to 
section 582.03 and section 12.  Creditors having a lien may 
redeem in the order and manner specified in section 580.24, but 
no creditor shall be entitled to redeem unless within such 
specified the applicable redemption period the creditor files 
with the court administrator notice of intention to redeem.  
    Sec. 11.  Minnesota Statutes 1988, section 582.03, is 
amended to read: 
    582.03 [PURCHASER AT FORECLOSURE, EXECUTION, OR JUDICIAL 
SALE MAY PAY TAXES, ASSESSMENTS, INSURANCE PREMIUMS, OR 
INTEREST.] 
    The purchaser at any sale, upon foreclosure of mortgage or 
execution or at any judicial sale during the year period of 
redemption, may pay any taxes or assessments on which any 
penalty would otherwise accrue, and may pay the premium upon any 
policy of insurance procured in renewal of any expiring policy 
upon mortgaged premises, may pay any costs incurred under 
section 12, and may, in case any interest or installment of 
principal upon any prior or superior mortgage, lien, or contract 
for deed is in default or shall become due during such year the 
period of redemption, pay the same, and, in all such cases, the 
sum so paid, with interest, shall be a part of the sum required 
to be paid to redeem from such sale.  Such payments shall be 
proved by the affidavit of the purchaser or the purchaser's 
agent or attorney, stating the items and describing the 
premises, which must be filed for record with the county 
recorder or registrar of titles, and a copy thereof shall be 
furnished to the sheriff at least ten days before the expiration 
of the year period of redemption. 
    Sec. 12.  [582.031] [LIMITED RIGHT OF ENTRY BY MORTGAGEE OR 
PURCHASER AT FORECLOSURE SALE.] 
    Subdivision 1.  [RIGHT OF ENTRY.] If premises described in 
a mortgage or sheriff's certificate are vacant or unoccupied, 
the holder of the mortgage or sheriff's certificate or the 
holder's agents and contractors may, but is under no obligation 
to, enter upon the premises to protect the premises from waste, 
until the holder of the mortgage or sheriff's certificate 
receives notice that the premises are occupied.  The holder of 
the mortgage or sheriff's certificate does not become a 
mortgagee in possession by taking actions authorized under this 
section.  An affidavit of the sheriff, the holder of the 
mortgage or sheriff's certificate, or a person acting on behalf 
of the holder, describing the premises and stating that the same 
are vacant or unoccupied, is prima facie evidence of the facts 
stated in the affidavit and is entitled to be recorded in the 
office of the county recorder or the registrar of titles in the 
county where the premises are located, if it contains a legal 
description of the premises.  
    Subd. 2.  [AUTHORIZED ACTIONS.] The holder of the mortgage 
or sheriff's certificate may take the following actions to 
protect the premises from waste:  install or change locks on 
doors and windows, board windows, and otherwise prevent or 
minimize damage to the premises from the elements, vandalism, 
trespass, or other illegal activities.  If the holder of the 
mortgage or sheriff's certificate installs or changes locks 
under this section, a key to the premises must be promptly 
delivered to the mortgagor or any person lawfully claiming 
through the mortgagor, upon request. 
    Subd. 3.  [COSTS.] All costs incurred by the holder of the 
mortgage to protect the premises from waste may be added to the 
principal balance of the mortgage.  The costs may bear interest 
to the extent provided in the mortgage and may be added to the 
redemption price if the costs are incurred after a foreclosure 
sale.  If the costs are incurred after a foreclosure sale, the 
purchaser at the foreclosure sale must comply with the 
provisions of section 582.03.  The provisions of this section 
are in addition to, and do not limit or replace, any other 
rights or remedies available to holders of mortgages and 
sheriff's certificates, at law or under the applicable mortgage 
agreements. 
    Sec. 13.  [582.032] [FIVE-WEEK REDEMPTION PERIOD FOR 
CERTAIN ABANDONED PROPERTIES.] 
    Subdivision 1.  [APPLICATION.] This section applies to 
mortgages executed after December 31, 1989, under which there 
has been a default in the payment of money existing for at least 
60 days as of the date of the filing of the complaint or motion 
provided for in this section.  This section applies only when 
the mortgaged premises are:  
    (1) ten acres or less in size; 
    (2) improved with a residential dwelling consisting of less 
than five units which is neither a model home nor a dwelling 
under construction; and 
    (3) not property used in agricultural production within the 
meaning of Laws 1986, chapter 398, section 5.  
    This section applies to foreclosures by action under 
chapter 581 and to foreclosures by advertisement under chapter 
580. 
    Subd. 2.  [BEFORE FORECLOSURE SALE.] Notwithstanding 
section 580.23 or 581.10, if at any time before the foreclosure 
sale but not more than 30 days before the first publication of 
the notice of sale, a court order is entered reducing the 
mortgagor's redemption period to five weeks under subdivision 7, 
after the mortgaged premises have been sold as provided in 
chapter 580 or 581, the mortgagor, and the mortgagor's personal 
representatives or assigns, within five weeks after the sale 
under chapter 580, or within five weeks after the date of the 
order confirming the sale under chapter 581, may redeem the 
mortgaged premises as provided in section 580.23, subdivision 1, 
or section 581.10, as applicable.  If an order is obtained after 
the first publication of the notice of sale, the five-week 
redemption period applies only if the notice of sale contained 
the statement required by section 580.04, clause (7). 
    Subd. 3.  [AFTER FORECLOSURE SALE.] Notwithstanding section 
580.23 or 581.10, if at any time after the foreclosure sale, a 
court order is entered reducing the mortgagor's redemption 
period under subdivision 7, the period during which the 
mortgagor, the mortgagor's personal representatives and assigns, 
may redeem the mortgaged premises in accordance with the 
provisions of section 580.23, subdivision 1, or section 581.10, 
as applicable, is reduced so as to expire five weeks from the 
date the order is entered.  Within ten days after the order is 
entered, a certified copy of the order must be filed with the 
office of the county recorder or registrar of titles for the 
county in which the mortgaged premises are located, and a copy 
of the order must be posted in a conspicuous place on the 
mortgaged premises.  Within ten days of the order's entry, a 
copy of the order must be sent by certified mail to any party 
holding a lien or interest of record junior to the foreclosed 
mortgage who has filed with the county recorder or registrar of 
titles a certificate identifying the lienholder and the lien 
claimed, stating the lienholder's address and the legal 
description of the property covered by the lien, and requesting 
notice of any post-foreclosure sale reduction of the mortgagor's 
redemption period for any superior lien.  Affidavits of posting 
and mailing to evidence the same are prima facie evidence of the 
facts stated therein and are entitled to recordation along with 
the certified copy of the order. 
    Subd. 4.  [SUMMONS AND COMPLAINT.] In a foreclosure by 
advertisement, the party foreclosing a mortgage or holding the 
sheriff's certificate of sale may initiate a proceeding in 
district court to reduce the mortgagor's redemption period under 
this section.  The proceeding must be initiated by the filing of 
a complaint, naming the mortgagor, or the mortgagor's personal 
representatives or assigns of record, as defendant, in district 
court for the county in which the mortgaged premises are 
located.  If the proceeding is commenced after the foreclosure 
sale, the holders of junior liens and interests entitled to 
notice under subdivision 3 must also be named as defendants.  
The complaint must identify the mortgaged premises by legal 
description and must identify the mortgage by the names of the 
mortgagor and mortgagee, and any assignee of the mortgagee; the 
date of its making; and pertinent recording information.  The 
complaint must allege that the mortgaged premises are:  
    (1) ten acres or less in size; 
    (2) improved with a residential dwelling consisting of less 
than five units, which is not a model home or a dwelling under 
construction; 
    (3) not property used in agricultural production within the 
meaning of Laws 1986, chapter 398, section 5; and 
    (4) abandoned.  
    The complaint must request an order reducing the 
mortgagor's redemption period to five weeks.  When the complaint 
has been filed, the court shall issue a summons commanding the 
person or persons named in the complaint to appear before the 
court on a day and at a place stated in the summons.  The 
appearance date shall be not less than l5 nor more than 25 days 
from the date of the issuing of the summons.  A copy of the 
filed complaint must be attached to the summons. 
    Subd. 5.  [ORDER TO SHOW CAUSE.] In a foreclosure by 
action, the plaintiff or the holder of the sheriff's certificate 
may make a motion to reduce the mortgagor's redemption period 
under this section.  The motion must conform generally to the 
pleading requirements provided in subdivision 4.  For purposes 
of the motion, the court has continuing jurisdiction over the 
parties and the mortgaged premises through the expiration of the 
redemption period.  When the motion has been filed, the court 
shall issue an order to show cause commanding the parties it 
considers appropriate to appear before the court on a day and at 
a place stated in the order.  The appearance date may not be 
less than 15 nor more than 25 days after the date of the order 
to show cause.  A copy of the motion must be attached to the 
order to show cause.  
    Subd. 6.  [SERVICE.] The summons or order to show cause may 
be served by any person not named a party to the action.  The 
summons or order to show cause must be served at least seven 
days before the appearance date, in the manner provided for 
service of a summons in a civil action in the district court.  
If the defendant cannot be found in the county, the summons or 
order to show cause may be served by sending a copy by certified 
mail to the defendant's last known address, if any, at least ten 
days before the appearance date.  The summons or order to show 
cause must be posted in a conspicuous place on the mortgaged 
premises not less than seven days before the appearance date.  
If personal or certified mail service cannot be made on a 
defendant, then the plaintiff or plaintiff's attorney may file 
an affidavit to that effect with the court and service by 
posting the summons or order to show cause on the mortgaged 
premises is sufficient as to that defendant. 
    Subd. 7.  [HEARING; EVIDENCE; ORDER.] At the hearing on the 
summons and complaint or order to show cause, the court shall 
enter an order reducing the mortgagor's redemption period as 
provided in subdivision 2 or 3, as applicable, if evidence is 
presented supporting the allegations in the complaint or motion 
and no appearance is made to oppose the relief sought.  An 
affidavit by the sheriff or a deputy sheriff of the county in 
which the mortgaged premises are located, or of a building 
inspector, zoning administrator, housing official, or other 
municipal or county official having jurisdiction over the 
mortgaged premises, stating that the mortgaged premises are not 
actually occupied and further setting forth any of the following 
supporting facts, is prima facie evidence of abandonment: 
    (1) windows or entrances to the premises are boarded up or 
closed off, or multiple window panes are broken and unrepaired; 
    (2) doors to the premises are smashed through, broken off, 
unhinged, or continuously unlocked; 
    (3) gas, electric, or water service to the premises has 
been terminated; 
    (4) rubbish, trash, or debris has accumulated on the 
mortgaged premises; 
    (5) the police or sheriff's office has received at least 
two reports of trespassers on the premises, or of vandalism or 
other illegal acts being committed on the premises; or 
    (6) the premises are deteriorating and are either below or 
are in imminent danger of falling below minimum community 
standards for public safety and sanitation. 
    An affidavit of the party foreclosing the mortgage or 
holding the sheriff's certificate, or one of their agents or 
contractors, stating any of the above supporting facts, and that 
the affiant has changed locks on the mortgaged premises under 
section 12 and that for a period of ten days no party having a 
legal possessory right has requested entrance to the premises, 
is also prima facie evidence of abandonment.  Either affidavit 
described above, or an affidavit from any other person having 
knowledge, may state facts supporting any other allegations in 
the complaint or motion and is prima facie evidence of the 
same.  Written statements of the mortgagor, the mortgagor's 
personal representatives or assigns, including documents of 
conveyance, which indicate a clear intent to abandon the 
premises, are conclusive evidence of abandonment.  In the 
absence of affidavits or written statements, or if rebuttal 
evidence is offered by the defendant or a party lawfully 
claiming through the defendant, the court may consider any 
competent evidence, including oral testimony, concerning any 
allegation in the complaint or motion.  An order entered under 
this section must contain a legal description of the mortgaged 
premises. 
    Subd. 8.  [RECORDING.] A certified copy of an order 
reducing a mortgagor's redemption period entered under this 
section may be recorded in the office of the county recorder or 
registrar of titles for the county in which the mortgaged 
premises are located. 
    Sec. 14.  Minnesota Statutes 1988, section 582.30, 
subdivision 2, is amended to read: 
    Subd. 2.  [GENERAL PROHIBITION FOR PROPERTY WITH A 
SIX-MONTH OR FIVE-WEEK REDEMPTION PERIOD.] A deficiency judgment 
is not allowed if a mortgage is foreclosed by advertisement 
under chapter 580, and has a redemption period of six months 
under section 580.23, subdivision 1, or five weeks under section 
13.  

                               ARTICLE 4 

                              SPECIAL LAWS 
    Section 1.  [DEFINITION.] 
    "City" means the city of Saint Paul and the city of 
Minneapolis for purposes of sections 2 to 6. 
    Sec. 2.  Laws 1974, chapter 285, section 1, is amended to 
read: 
    Section 1.  [MINNEAPOLIS, CITY OF; HOUSING ACQUISITION AND 
REHABILITATION LOAN AND GRANT PROGRAM; PURPOSE.] The legislature 
of the state of Minnesota finds that preservation of the quality 
of life in a major metropolitan city is dependent upon the 
preservation of adequate housing, that many houses in the city 
cities of Minneapolis and Saint Paul do not meet the applicable 
housing code or otherwise need rehabilitation or modernizing, 
that there is a need for a comprehensive housing rehabilitation 
program in the city cities of Minneapolis and Saint Paul which 
will complement any statewide housing rehabilitation program, 
that some home owners are unable to afford any rehabilitation 
expenses, that many home owners are unable to afford housing 
rehabilitation loans at market rate of interest, and that 
because the availability of mortgage credit for housing 
rehabilitation is limited some home owners cannot obtain such 
credit, and that reinvestment in the housing stock by 
rehabilitating and updating homes is necessary to maintain the 
stability of neighborhoods in the city.  The legislature further 
finds that the construction of housing to replace individual 
dilapidated and obsolete buildings, for which rehabilitation is 
not economically feasible, is necessary to increase the 
stability and maintain the value of housing in established 
neighborhoods. 
    Sec. 3.  Laws 1974, chapter 285, section 2, is amended to 
read: 
    Sec. 2.  [CITY OF MINNEAPOLIS; HOUSING REHABILITATION LOAN 
PROGRAM.] The city of Minneapolis is authorized to develop and 
administer a housing rehabilitation loan program with respect to 
property located anywhere within its boundaries on such terms 
and conditions as it determines; provided that in approving 
applications for this such a program, the following factors 
shall be considered: 
    (1) The availability of other governmental programs 
affordable by the applicant; 
    (2) The availability and affordability of private market 
financing; 
    (3) Whether the housing is required, pursuant to an urban 
renewal program or a code enforcement program, to be repaired, 
improved, or rehabilitated; 
    (4) Whether the housing is required, pursuant to a court 
order issued under Minnesota Statutes, 1973 Supplement, Section 
566.25, Clauses (b), (c), and (e), to be repaired, improved, or 
rehabilitated; 
    (5) Whether the housing has been determined to be 
uninsurable because of physical hazards after inspection 
pursuant to a statewide property insurance plan approved by the 
United States Department of Housing and Urban Development under 
Title XII of the National Housing Act; and further provided that 
all loans and grants shall be issued primarily for 
rehabilitating housing so that it meets applicable housing codes.
    (6) Whether rehabilitation of the housing will maintain or 
improve the value of the housing and will help to stabilize the 
neighborhood in which the housing is located. 
    Sec. 4.  Laws 1974, chapter 285, is amended by adding a 
section to read: 
    Sec. 2a.  [NEW SINGLE FAMILY RESIDENCES.] 
    Any housing rehabilitation loan program undertaken under 
section 3 may also provide for the city to make or purchase 
loans made to finance the acquisition of single family 
residences that have been newly constructed in established 
neighborhoods on land owned by the city or any agency of the 
city.  For purposes of this section, land shall be considered to 
be owned by the city if the city or one of its agencies 
previously owned the land and conveyed it to an individual under 
a development agreement in which the individual has agreed to 
construct single family housing on such land.  In approving 
applications for a loan to be made under this section, the 
following factors shall be considered: 
    (1) the availability and affordability of other 
governmental programs or private market financing; and 
    (2) whether the construction of such housing enhances the 
stability of the neighborhood in which it is located. 
    Sec. 5.  Laws 1974, chapter 285, section 3, is amended to 
read: 
    Sec. 3.  [CITY OF MINNEAPOLIS; HOUSING REHABILITATION GRANT 
PROGRAM.] The city of Minneapolis is authorized to develop and 
administer a housing rehabilitation grant program with respect 
to property within its boundaries, on such terms and conditions 
as it determines; provided that in approving applications 
for grants under this program, all of the considerations and 
limitations enumerated in section 2 for loans must be considered 
in making grants under this program, and the following factors 
must also be considered: 
    (1) Whether the housing unit is a single family dwelling or 
homesteaded unit and 
    (2) Whether the applicant is a person of low income; and 
further provided that the city council of the city of 
Minneapolis shall by ordinance set forth the regulations 
for this its grant program; and further provided that the dollar 
value of grants made shall not exceed five percent of the total 
value of the bonds issued for the loan and grant program 
together, and that all grants shall be made primarily to 
rehabilitate housing so that it meets applicable housing codes. 
    Sec. 6.  Laws 1974, chapter 285, section 4, is amended to 
read: 
    Sec. 4.  [ISSUANCE OF BONDS.] To finance the programs 
authorized in sections 2, 2a, and 3 of this act, the governing 
body of the city of Minneapolis may by resolution authorize, 
issue, and sell general obligation bonds of the city of 
Minneapolis in accordance with the provisions of Minnesota 
Statutes, Chapter 475.  The total amount of all bonds 
outstanding for the programs shall not exceed 
$10,000,000 $25,000,000.  The amount of all bonds issued shall 
be included in the net indebtedness of the city for the purpose 
of any charter or statutory debt limitation. 
    Sec. 7.  [462C.13] [CITY INDIAN HOUSING AUTHORITY.] 
    A city may establish an Indian housing authority as 
provided in the Code of Federal Regulations, title 24, part 905, 
with all necessary legal powers to carry out housing projects 
for low- and moderate-income American Indians. 
    Sec. 8.  [REPEALER.] 
    Laws 1974, chapter 351, sections 1, 2, 3, and 4, as amended 
by Laws 1975, chapter 260, section 5; and Laws 1975, chapter 
260, sections 1, 2, 3, 4, and 5, are repealed. 
    Sec. 9.  [EFFECTIVE DATE.] 
    Sections 1 to 6 and 8 are effective the day after enactment 
without local approval in accordance with Minnesota Statutes, 
section 645.023, subdivision 1, clause (a). 

                               ARTICLE 5 

            CAN-DO AND WAY TO GROW/SCHOOL READINESS PROGRAMS 
    Section 1.  [116J.983] [DEFINITIONS.] 
    Subdivision 1.  [SCOPE.] For the purposes of section 2, the 
following terms have the meanings given them. 
    Subd. 2.  [COMMUNITY AND NEIGHBORHOOD DEVELOPMENT 
ORGANIZATION GRANT.] "Community and neighborhood development 
organization grant" or "grant" means a grant awarded under 
section 2, subdivision 1. 
    Subd. 3.  [COMMUNITY AND NEIGHBORHOOD DEPARTMENT 
ORGANIZATION PLAN.] "Community and neighborhood department 
organization plan" or "plan" means the plan required under 
section 2, subdivision 2. 
    Subd. 4.  [ELIGIBLE ORGANIZATION.] "Eligible organization" 
means a nonprofit organization or group of persons that is 
recognized as a viable community or neighborhood organization by 
a home rule charter or statutory city, town, or an Indian tribe, 
and that has defined neighborhood or community boundaries.  An 
eligible organization must have a board that is representative 
of the neighborhood's or community's interests and whose members 
reflect the cultural, racial, and ethnic diversity of the 
neighborhood or community.  An eligible organization or group of 
persons must complete training and be certified as required 
under section 2, subdivision 3. 
    Sec. 2.  [116J.984] [COMMUNITY AND NEIGHBORHOOD DEVELOPMENT 
ORGANIZATION PILOT PROJECT.] 
    Subdivision 1.  [COMMUNITY AND NEIGHBORHOOD DEVELOPMENT 
GRANTS.] The commissioner may award matching grants to eligible 
organizations.  Grants to any one eligible organization may not 
exceed $25,000 in any fiscal year and a grant may not be used 
for any purpose that replaces an existing community program 
identified by the commissioner.  Each grant must be matched with 
at least two dollars of nonstate money or in-kind contributions 
to each dollar of grant money.  The grants may be used for 
community or neighborhood public safety and human service 
activities, street and public property lighting, recycling 
efforts, repair or removal of dilapidated buildings, community 
or neighborhood beautification and cleanup, historic 
preservation of buildings, small scale park and open space 
development, increasing or preserving the availability of 
housing primarily serving low- or moderate-income persons, and 
other projects, programs, or activities that the commissioner 
determines will improve or revitalize the community or 
neighborhood. 
    Subd. 2.  [GRANT APPLICATIONS.] Eligible organizations may 
apply to the commissioner for grants awarded under subdivision 
1.  The application must include a community and neighborhood 
development organization plan that addresses the following: 
    (1) a geographic, social, and economic description of the 
area served by the eligible organization; 
    (2) a description of why the projects or activities are 
required in the neighborhood or community; 
    (3) a detailed description of the objectives for which the 
grant money will be used; 
    (4) a description of the process used to encourage citizen 
involvement in determining the needs, objectives, and the design 
of the project or activity; 
    (5) an assessment of the strength and weaknesses of the 
neighborhood or community; 
    (6) a detailed description of the projects or activities 
that will be used to implement the objectives; 
    (7) a description of the expected outcomes of the projects 
or activities financed by the grant; 
    (8) identification of the source of the required matching 
funds; and 
    (9) any other information the commissioner determines 
necessary to award the grants. 
    Subd. 3.  [TRAINING; CERTIFICATION.] Before an eligible 
organization may apply for a grant under subdivision 1, the 
commissioner must certify that the eligible organization meets 
administrative, fiscal accountability, and planning 
requirements.  The commissioner shall establish a set of 
criteria for the certification of eligible organizations.  The 
commissioner may provide leadership and other training to 
eligible organizations to assist them in meeting the 
requirements for certification and developing the community and 
neighborhood development organization plan.  The commissioner 
may use other department resources and staff to carry out the 
training. 
    Subd. 4.  [RECERTIFICATION.] An eligible organization must 
be recertified annually to maintain its eligibility for grants 
under subdivision 1.  As part of recertification, the 
commissioner shall review the plan to determine whether the 
organization continues to address its objectives and the 
organization demonstrates that the community or neighborhood's 
level of volunteer citizen participation is maintained or 
expanded. 
    Subd. 5.  [APPLICATIONS; PRIORITY.] The commissioner may 
establish criteria to establish the priority of the applications 
received for grants awarded under subdivision 1.  The criteria 
may include: 
    (1) the degree of community support measured by the amount 
of participation in the project or activities by volunteers; 
    (2) the extent that the eligible organizations have 
participated with or solicited input from other organizations 
that provide community and regional assistance; 
    (3) the amount of nonstate matching funds identified as 
available for the project or activities; and 
    (4) any other criteria the commissioner determines 
necessary to carry out the purposes of this section. 
    Subd. 6.  [ENTITLEMENT.] The commissioner may set aside up 
to 40 percent of the money available under this section for 
grants awarded to eligible organizations located in cities of 
the first class as defined in section 410.01. 
    Subd. 7.  [LOCAL GOVERNMENT SUPPORT.] Before an application 
for a grant awarded under subdivision 1 may be considered by the 
commissioner, the eligible organization must have received a 
formal resolution of support for the application of the 
governing body of the home rule charter or statutory city, town, 
or Indian tribe within whose jurisdiction the eligible 
organization is located. 
    Subd. 8.  [COMMUNITY ASSISTANCE PROGRAM INVENTORY.] The 
commissioner may develop and maintain an inventory of public and 
private community assistance programs.  The inventory must be 
made available to eligible organizations, other community 
assistance providers, and other persons that request assistance 
from the commissioner.  In developing the inventory the 
commissioner shall coordinate with other similar activities. 
    Subd. 9.  [RULES.] The commissioner may adopt rules under 
chapter 14 as necessary for the administration of the grants 
under this section. 
    Subd. 10.  [STATE AGENCY COOPERATION.] State agencies must 
cooperate and assist when requested by the commissioner to carry 
out the purposes of this section. 
    Subd. 11.  [ADVISORY COMMITTEE.] The commissioner may 
establish advisory committees to assist in carrying out the 
purposes of this section. 
    Sec. 3.  [145.926] [WAY TO GROW/SCHOOL READINESS PROGRAM.] 
    Subdivision 1.  [ADMINISTRATION.] The commissioner of state 
planning shall administer the way to grow/school readiness 
program, in consultation with the commissioners of human 
services and education, to promote intellectual, social, 
emotional, and physical development and school readiness of 
children prebirth to age five by coordinating and improving 
access to community based and neighborhood based services that 
support and assist all parents in meeting the health and 
developmental needs of their children at the earliest possible 
age.  
    Subd. 2.  [PROGRAM COMPONENTS.] A way to grow/school 
readiness program may include: 
    (1) a program of home visitors to contact pregnant women 
early in their pregnancies, encourage them to obtain prenatal 
care, and provide social support, information, and referrals 
regarding prenatal care and well-baby care to reduce infant 
mortality, low birth weight, and childhood injury, disease, and 
disability; 
    (2) a program of home visitors to provide social support, 
information, and referrals regarding parenting skills and to 
encourage families to participate in parenting skills programs 
and other family supportive services; 
    (3) support of neighborhood based or community based 
parent-child and family resource centers or interdisciplinary 
resource teams to offer supportive services to families with 
preschool children; 
    (4) staff training, technical assistance, and incentives 
for collaboration designed to raise the quality of community 
services relating to prenatal care, child development, health, 
and school readiness; 
    (5) programs to raise general public awareness about 
practices that promote healthy child development and school 
readiness; 
    (6) support of neighborhood oriented and culturally 
specific social support, information, outreach, and other 
programs to promote healthy development of children and to help 
parents obtain the information, resources, and parenting skills 
needed to nurture and care for their children; 
    (7) programs to expand public and private collaboration to 
promote the development of a coordinated and culturally specific 
system of services available to all families; 
    (8) support of periodic screening and evaluation services 
for preschool children to assure adequate developmental 
progress; 
    (9) support of health, educational, and other developmental 
services needed by families with preschool children; 
    (10) support of family prevention and intervention programs 
needed to address risks of child abuse or neglect; 
    (11) development or support of a jurisdiction-wide 
coordinating agency to develop and oversee programs to enhance 
child health, development, and school readiness with special 
emphasis on neighborhoods with a high proportion of children in 
need; and 
    (12) other programs or services to improve the health, 
development, and school readiness of children in target 
neighborhoods and communities. 
    Subd. 3.  [ELIGIBLE GRANTEES.] An application for a grant 
may be submitted by any of the following entities: 
    (1) a city, town, county, school district, or other local 
unit of government; 
    (2) two or more governmental units organized under a joint 
powers agreement; 
    (3) a community action agency that satisfies the 
requirements of section 268.53, subdivision 1; or 
    (4) a nonprofit organization, or consortium of nonprofit 
organizations, that demonstrates collaborative effort with at 
least one unit of local government. 
    Subd. 4.  [PILOT PROJECTS.] The commissioner of state 
planning shall award grants for one pilot project in each of the 
following areas of the state: 
    (1) a first class city located within the metropolitan area 
as defined in section 473.121, subdivision 2; 
    (2) a second class city located within the metropolitan 
area as defined in section 473.121, subdivision 2; 
    (3) a city with a population of 50,000 or more that is 
located outside of the metropolitan area as defined in section 
473.121, subdivision 2; and 
    (4) the area of the state located outside of the 
metropolitan area as defined in section 473.121, subdivision 2.  
    To the extent possible, the commissioner of state planning 
shall award grants to applicants with experience or demonstrated 
ability in providing comprehensive, multidisciplinary, community 
based programs with objectives similar to those listed in 
subdivision 2, or in providing other human services or social 
services programs using a multidisciplinary, community based 
approach. 
    Subd. 5.  [APPLICATIONS.] Each grant application must 
propose a five-year program designed to accomplish the purposes 
of this section.  The application must be submitted on forms 
provided by the commissioner of state planning.  The grant 
application must include: 
    (1) a description of the specific neighborhoods that will 
be served under the program and the name, address, and a 
description of each community agency or agencies with which the 
applicant intends to contract to provide services using grant 
money; 
    (2) a letter of intent from each community agency 
identified in clause (1) that indicates the agency's willingness 
to participate in the program and approval of the proposed 
program structure and components; 
    (3) a detailed description of the structure and components 
of the proposed program and an explanation of how each component 
will contribute to accomplishing the purposes of this section; 
    (4) a description of how public and private resources, 
including schools, health care facilities, government agencies, 
neighborhood organizations, and other resources, will be 
coordinated and made accessible to families in target 
neighborhoods, including letters of intent from public and 
private agencies indicating their willingness to cooperate with 
the program; 
    (5) a detailed, proposed budget that demonstrates the 
ability of the program to accomplish the purposes of this 
section using grant money and other available resources, 
including funding sources other than a grant; and 
    (6) a comprehensive evaluation plan for measuring the 
success of the program in meeting the objectives of the overall 
grant program and the individual grant project, including an 
assessment of the impact of the program in terms of at least 
three of the following criteria:  
    (i) utilization rates of community services; 
    (ii) availability of support systems for families; 
    (iii) birth weights of newborn babies; 
    (iv) child accident rates; 
    (v) utilization rates of prenatal care; 
    (vi) reported rates of child abuse; and 
    (vii) rates of health screening and evaluation. 
    Subd. 6.  [MATCH.] Each dollar of state money must be 
matched with 50 cents of nonstate money.  The pilot project 
selected under subdivision 4, clause (4), may match state money 
with in-kind contributions, including volunteer assistance. 
    Subd. 7.  [ADVISORY COMMITTEES.] The commissioner of state 
planning shall establish a program advisory committee consisting 
of persons knowledgeable in child development, child and family 
services, and the needs of people of color and high risk 
populations; and representatives of the commissioners of state 
planning and education.  Each grantee must establish a program 
advisory board of 12 or more members to advise the grantee on 
program design, operation, and evaluation.  The board must 
include representatives of local units of government and 
representatives of the project area who reflect the geographic, 
cultural, racial, and ethnic diversity of that community.  
    Subd. 8.  [REPORT.] The commissioner of state planning 
shall provide a biennial report to the legislature on the 
program administration and the activities of projects funded 
under this section. 

                               ARTICLE 6 

                  NEIGHBORHOOD REVITALIZATION PROGRAM 
    Section 1.  Minnesota Statutes 1988, section 282.01, 
subdivision 1, is amended to read: 
    Subdivision 1.  [CLASSIFICATION; USE; EXCHANGE.] It is the 
general policy of this state to encourage the best use of 
tax-forfeited lands, recognizing that some lands in public 
ownership should be retained and managed for public benefits 
while other lands should be returned to private ownership.  All 
parcels of land becoming the property of the state in trust 
under the provisions of any law now existing or hereafter 
enacted declaring the forfeiture of lands to the state for 
taxes, shall be classified by the county board of the county 
wherein such parcels lie as conservation or nonconservation.  
Such classification shall be made with consideration, among 
other things, to the present use of adjacent lands, the 
productivity of the soil, the character of forest or other 
growth, accessibility of lands to established roads, schools, 
and other public services, their peculiar suitability or 
desirability for particular uses and the suitability of the 
forest resources on the land for multiple use, sustained yield 
management.  Such classification, furthermore, shall aid:  to 
encourage and foster a mode of land utilization that will 
facilitate the economical and adequate provision of 
transportation, roads, water supply, drainage, sanitation, 
education, and recreation; to facilitate reduction of 
governmental expenditures; to conserve and develop the natural 
resources; and to foster and develop agriculture and other 
industries in the districts and places best suited thereto. 
     In making such classification the county board may make use 
of such data and information as may be made available by any 
office or department of the federal, state, or local 
governments, or by any other person or agency possessing 
information pertinent thereto at the time such classification is 
made.  Such lands may be reclassified from time to time as the 
county board may deem necessary or desirable, except as to 
conservation lands held by the state free from any trust in 
favor of any taxing district.  
     If any such lands are located within the boundaries of any 
organized town, with taxable valuation in excess of $20,000, or 
incorporated municipality, the classification or 
reclassification and sale shall first be approved by the town 
board of such town or the governing body of such municipality 
insofar as the lands located therein are concerned.  The town 
board of the town or the governing body of the municipality will 
be deemed to have approved the classification or 
reclassification and sale if the county board is not notified of 
the disapproval of the classification or reclassification and 
sale within 90 days of the date the request for approval was 
transmitted to the town board of the town or governing body of 
the municipality.  If the town board or governing body desires 
to acquire any parcel lying in the town or municipality by 
procedures authorized in this subdivision, it shall, within 90 
days of the request for classification or reclassification and 
sale, file a written application with the county board to 
withhold the parcel from public sale.  The county board shall 
then withhold the parcel from public sale for one year.  
    Any tax-forfeited lands may be sold by the county board to 
any organized or incorporated governmental subdivision of the 
state for any public purpose for which such subdivision is 
authorized to acquire property or may be released from the trust 
in favor of the taxing districts upon application of any state 
agency for any authorized use at not less than their value as 
determined by the county board.  The commissioner of revenue 
shall have power to may convey by deed in the name of the state 
any tract of tax-forfeited land held in trust in favor of the 
taxing districts, to any governmental subdivision for any 
authorized public use, provided that an application therefor 
shall be is submitted to the commissioner with a statement of 
facts as to the use to be made of such the tract and the need 
therefor and the recommendation of the county board.  The 
commissioner of revenue shall convey by deed in the name of the 
state any tract of tax-forfeited land held in trust in favor of 
the taxing districts, to a political subdivision that submits an 
application to the commissioner of revenue and the county 
board.  The application must include a resolution, adopted by 
the governing body of the political subdivision, finding that 
the conveyance of a tract of tax-forfeited land to the political 
subdivision is necessary to provide for the redevelopment of 
land as productive taxable property.  The deed of conveyance 
shall be upon a form approved by the attorney general and shall 
be conditioned upon continued use for the purpose stated in the 
application, provided, however, that if the governing body of 
such governmental subdivision by resolution determines that some 
other public use shall be made of such lands, and such change of 
use is approved by the county board and an application for such 
change of use is made to, and approved by, the commissioner, 
such changed use may be made of such lands without the necessity 
of the governing body conveying the lands back to the state and 
securing a new conveyance from the state to the governmental 
subdivision for such new public use. 
    Whenever any governmental subdivision to which any 
tax-forfeited land has been conveyed for a specified public use 
as provided in this section shall fail to put such land to such 
use, or to some other authorized public use as provided herein, 
or shall abandon such use, the governing body of the subdivision 
shall authorize the proper officers to convey the same, or such 
portion thereof not required for an authorized public use, to 
the state of Minnesota, and such officers shall execute a deed 
of such conveyance forthwith, which conveyance shall be subject 
to the approval of the commissioner and in form approved by the 
attorney general, provided, however, that a sale, lease, 
transfer or other conveyance of such lands by a housing and 
redevelopment authority, a port authority, an economic 
development authority, or a city as authorized by sections 
469.001 to 469.047 chapter 469 shall not be an abandonment of 
such use and such lands shall not be reconveyed to the state nor 
shall they revert to the state.  A certificate made by a housing 
and redevelopment authority, a port authority, an economic 
development authority, or a city referring to a conveyance by it 
and stating that the conveyance has been made as authorized 
by sections 469.001 to 469.047 chapter 469 may be filed with the 
county recorder or registrar of titles, and the rights of 
reverter in favor of the state provided by this subdivision will 
then terminate.  No vote of the people shall be required for 
such conveyance.  In case any such land shall not be so conveyed 
to the state, the commissioner of revenue shall by written 
instrument, in form approved by the attorney general, declare 
the same to have reverted to the state, and shall serve a notice 
thereof, with a copy of the declaration, by certified mail upon 
the clerk or recorder of the governmental subdivision concerned, 
provided, that no declaration of reversion shall be made earlier 
than five years from the date of conveyance for failure to put 
such land to such use or from the date of abandonment of such 
use if such lands have been put to such use.  The commissioner 
shall file the original declaration in the commissioner's 
office, with verified proof of service as herein required.  The 
governmental subdivision may appeal to the district court of the 
county in which the land lies by filing with the court 
administrator a notice of appeal, specifying the grounds of 
appeal and the description of the land involved, mailing a copy 
thereof by certified mail to the commissioner of revenue, and 
filing a copy thereof for record with the county recorder or 
registrar of titles, all within 30 days after the mailing of the 
notice of reversion.  The appeal shall be tried by the court in 
like manner as a civil action.  If no appeal is taken as herein 
provided, the declaration of reversion shall be final.  The 
commissioner of revenue shall file for record with the county 
recorder or registrar of titles, of the county within which the 
land lies, a certified copy of the declaration of reversion and 
proof of service. 
     Any city of the first class now or hereafter having a 
population of 450,000, or over, or its board of park 
commissioners, which has acquired tax-forfeited land for a 
specified public use pursuant to the terms of this section, may 
convey said land in exchange for other land of substantially 
equal worth located in said city of the first class, provided 
that the land conveyed to said city of the first class now or 
hereafter having a population of 450,000, or over, or its board 
of park commissioners, in exchange shall be subject to the 
public use and reversionary provisions of this section; the 
tax-forfeited land so conveyed shall thereafter be free and 
discharged from the public use and reversionary provisions of 
this section, provided that said exchange shall in no way affect 
the mineral or mineral rights of the state of Minnesota, if any, 
in the lands so exchanged. 
    Sec. 2.  Minnesota Statutes 1988, section 462C.02, is 
amended by adding a subdivision to read: 
    Subd. 12.  [LOAN.] "Loan" means (1) for single family 
housing, any loan, mortgage, or other form of owner financing; 
and (2) for multifamily housing developments which are rental 
property, any loan, mortgage, financing lease, or revenue 
agreement.  
    Sec. 3.  Minnesota Statutes 1988, section 462C.02, is 
amended by adding a subdivision to read: 
    Subd. 13.  [REVENUE AGREEMENT] "Revenue agreement" has the 
meaning given that term in section 469.153, subdivision 10.  
    Sec. 4.  Minnesota Statutes 1988, section 462C.05, is 
amended by adding a subdivision to read: 
    Subd. 8.  [REVENUE AGREEMENT AND FINANCING LEASE.] Any 
revenue agreement or financing lease which includes a provision 
for a conveyance of real estate to the lessee or contracting 
party may be terminated in accordance with the revenue agreement 
or financing lease, notwithstanding that the revenue agreement 
or financing lease may constitute an equitable mortgage.  No 
financing lease of any development is subject to section 504.02, 
unless expressly so provided in the financing lease.  Leases of 
specific dwelling units in the development to tenants are not 
affected by this subdivision.  
    Sec. 5.  Minnesota Statutes 1988, section 463.15, 
subdivision 3, is amended to read: 
    Subd. 3.  [HAZARDOUS BUILDING OR HAZARDOUS PROPERTY.] 
"Hazardous building or hazardous property" means any building or 
property, which because of inadequate maintenance, dilapidation, 
physical damage, unsanitary condition, or abandonment, 
constitutes a fire hazard or a hazard to public safety or health.
    Sec. 6.  Minnesota Statutes 1988, section 463.15, 
subdivision 4, is amended to read: 
    Subd. 4.  [OWNER, OWNER OF RECORD, AND LIEN HOLDER OF 
RECORD.] "Owner," "owner of record," and "lien holder of record" 
means a person having a right or interest in property to which 
Laws 1967, chapter 324, applies described in subdivision 3 and 
evidence of which is filed and recorded in the office of the 
county recorder or registrar of titles in the county in which 
the property is situated. 
    Sec. 7.  Minnesota Statutes 1988, section 463.16, is 
amended to read: 
    463.16 [REPAIR OR REMOVAL OF HAZARDOUS BUILDING; HAZARDOUS 
PROPERTY CONDITIONS.] 
    The governing body of any city or town may order the owner 
of any hazardous building or property within the municipality to 
correct or remove the hazardous condition of such the building 
or property or to raze or remove the same building.  
    Sec. 8.  Minnesota Statutes 1988, section 463.161, is 
amended to read: 
    463.161 [ABATEMENT.] 
    In the manner prescribed in section 463.21 the governing 
body of any city or town may correct or remove the hazardous 
condition of any hazardous building or parcel of real estate 
property; the cost of which shall be charged against the real 
estate as provided in section 463.21 except the governing body 
may provide that the cost so assessed may be paid in not to 
exceed five equal annual installments with interest therein, at 
eight percent per annum.  
    Sec. 9.  Minnesota Statutes 1988, section 463.17, is 
amended to read: 
    463.17 [THE ORDER.] 
    Subdivision 1.  [CONTENTS.] The order shall be in writing; 
recite the grounds therefor; specify the necessary repairs, if 
any, and provide a reasonable time for compliance; and shall 
state that a motion for summary enforcement of the order will be 
made to the district court of the county in which the hazardous 
building or property is situated unless corrective action is 
taken, or unless an answer is filed within the time specified in 
section 463.18. 
    Subd. 2.  [SERVICE.] The order shall be served upon the 
owner of record, or the owner's agent if an agent is in charge 
of the building or property, and upon the occupying tenant, if 
there is one, and upon all lien holders of record, in the manner 
provided for service of a summons in a civil action.  If the 
owner cannot be found, the order shall be served upon the owner 
by posting it at the main entrance to the building or, if there 
is no building, in a conspicuous place on the property, and by 
four weeks' publication in the official newspaper of the 
municipality if it has one, otherwise in a legal newspaper in 
the county. 
    Subd. 3.  [FILING.] A copy of the order with proof of 
service shall be filed with the court administrator of district 
court of the county in which the hazardous building or property 
is located not less than five days prior to the filing of a 
motion pursuant to section 463.19 to enforce the order.  At the 
time of filing such order the municipality shall file for record 
with the county recorder or registrar of titles a notice of the 
pendency of the proceeding, describing with reasonable certainty 
the lands affected and the nature of the order.  If the 
proceeding be abandoned the municipality shall within ten days 
thereafter file with the county recorder a notice to that effect.
    Sec. 10.  Minnesota Statutes 1988, section 463.20, is 
amended to read: 
    463.20 [CONTESTED CASES.] 
    If an answer is filed and served as provided in section 
463.18, further proceedings in the action shall be governed by 
the rules of civil procedure for the district courts, except 
that the action has priority over all pending civil actions and 
shall be tried forthwith.  If the order is sustained following 
the trial, the court shall enter judgment and shall fix a time 
after which the building shall must be destroyed or repaired or 
the hazardous condition removed or corrected, as the case may 
be, in compliance with the order as originally filed or modified 
by the court.  If the order is not sustained, it shall be 
annulled and set aside.  The court administrator of the court 
shall cause a copy of the judgment to be mailed forthwith to the 
persons upon whom the original order was served. 
    Sec. 11.  Minnesota Statutes 1988, section 463.22, is 
amended to read: 
    463.22 [STATEMENT OF MONEYS RECEIVED.] 
    The municipality shall keep an accurate account of the 
expenses incurred in carrying out the order and of all other 
expenses theretofore incurred in connection with its 
enforcement, including specifically, but not exclusively, filing 
fees, service fees, publication fees, attorney's fees, 
appraisers' fees, witness fees, including expert witness fees, 
and traveling expenses incurred by the municipality from the 
time the order was originally made, and shall credit thereon the 
amount, if any, received from the sale of the salvage, or 
building or structure, and shall report its action under the 
order, with a statement of moneys received and expenses incurred 
to the court for approval and allowance.  Thereupon the court 
shall examine, correct, if necessary, and allow the expense 
account, and, if the amount received from the sale of the 
salvage, or of the building or structure, does not equal or 
exceed the amount of expenses as allowed, the court shall by its 
judgment certify the deficiency in the amount so allowed to the 
municipal clerk for collection.  The owner or other party in 
interest shall pay the same, without penalty added thereon, and 
in default of payment by October 1, the clerk shall certify the 
amount of the expense to the county auditor for entry on the tax 
lists of the county as a special charge against the real estate 
on which the building or hazardous condition is or was situated 
and the same shall be collected in the same manner as other 
taxes and the amount so collected shall be paid into the 
municipal treasury.  If the amount received for the sale of the 
salvage or of the building or structure exceeds the expense 
incurred by the municipality as allowed by the court, and if 
there are no delinquent taxes, the court shall direct the 
payment of the surplus to the owner or the payment of the same 
into court, as provided in sections 463.15 to 463.26.  If there 
are delinquent taxes against the property, the court shall 
direct the payment of the surplus to the county treasurer to be 
applied on such taxes. 
    Sec. 12.  [469.201] [DEFINITIONS.] 
    Subdivision 1.  [APPLICABILITY.] The definitions in this 
section apply to sections 12 to 18. 
    Subd. 2.  [CITY.] "City" means a city of the first class as 
defined in section 410.01.  For each city, a port authority, 
housing and redevelopment authority, or other agency or 
instrumentality, the jurisdiction of which is the territory of 
the city, is included within the meaning of city. 
    Subd. 3.  [CITY COUNCIL.] "City council" means the city 
council of a city as defined in subdivision 2. 
    Subd. 4.  [CITY MATCHING MONEY.] (a) "City matching money" 
means the money of a city specified in a revitalization 
program.  The sources of city matching money may include: 
    (1) money from the general fund or a special fund of a city 
used to implement a revitalization program; 
    (2) money paid or repaid to a city from the proceeds of a 
grant that a city has received from the federal government, a 
profit or nonprofit corporation, or another entity or 
individual, that is to be used to implement a revitalization 
program; 
    (3) tax increments received by a city under sections 
469.174 to 469.179 or other law, if eligible, to be spent in the 
targeted neighborhood; 
    (4) the greater of the fair market value or the cost to the 
city of acquiring land, buildings, equipment, or other real or 
personal property that a city contributes, grants, leases, or 
loans to a profit or nonprofit corporation or other entity or 
individual, in connection with the implementation of a 
revitalization program; 
    (5) city money to be used to acquire, install, reinstall, 
repair, or improve the infrastructure facilities of a targeted 
neighborhood; 
    (6) money contributed by a city to pay issuance costs, fund 
bond reserves, or to otherwise provide financial support for 
revenue bonds or obligations issued by a city for a project or 
program related to the implementation of a revitalization 
program; 
    (7) money derived from fees received by a city in 
connection with its community development activities that are to 
be used in implementing a revitalization program; 
    (8) money derived from the apportionment to the city under 
section 162.14 or by special law, and expended in a targeted 
neighborhood for an activity related to the revitalization 
program; 
    (9) administrative expenses of the city that are incurred 
in connection with the planning, implementation, or reporting 
requirements of sections 12 to 18. 
    (b) City matching money does not include: 
    (1) city money used to provide a service or to exercise a 
function that is ordinarily provided throughout the city, unless 
an increased level of the service or function is to be provided 
in a targeted neighborhood in accordance with a revitalization 
program; 
    (2) the proceeds of bonds issued by the city under chapter 
462C or 469 and payable solely from repayments made by one or 
more nongovernmental persons in consideration for the financing 
provided by the bonds; or 
    (3) money given by the state to fund any part of the 
revitalization program.  
    Subd. 5.  [COMMISSIONER.] "Commissioner" means the 
commissioner of trade and economic development. 
    Subd. 6.  [HOUSING ACTIVITIES.] "Housing activities" 
include any work or undertaking to provide housing and related 
services and amenities primarily for persons and families of low 
or moderate income.  This work or undertaking may include the 
planning of buildings and improvements; the acquisition of real 
property which may be needed immediately or in the future for 
housing purposes and the demolition of any existing 
improvements; and the construction, reconstruction, alteration, 
and repair of new and existing buildings.  Housing activities 
also include the provision of a housing rehabilitation and 
energy improvement loan and grant program with respect to any 
residential property located within the targeted neighborhood, 
the cost of relocation relating to acquiring property for 
housing activities, and programs authorized by chapter 462C. 
    Subd. 7.  [LOST UNIT.] "Lost unit" means a rental housing 
unit that is lost as a result of revitalization activities 
because it is demolished, converted to an owner-occupied unit 
that is not a cooperative, or converted to a nonresidential use, 
or because the gross rent to be charged exceeds 125 percent of 
the gross rent charged for the unit six months before the start 
of rehabilitation. 
    Subd. 8.  [PERSONS AND FAMILIES OF LOW INCOME.] "Persons 
and families of low income" means persons and families of low 
income as defined in section 469.002, subdivision 17. 
    Subd. 9.  [PERSONS AND FAMILIES OF MODERATE 
INCOME.] "Persons and families of moderate income" means persons 
and families of moderate income as defined in section 469.002, 
subdivision 18. 
    Subd. 10.  [TARGETED NEIGHBORHOOD.] "Targeted neighborhood" 
means an area including one or more census tracts, as determined 
and measured by the Bureau of Census of the United States 
Department of Commerce, that a city council determines in a 
resolution adopted under section 13, subdivision 1, meets the 
criteria of section 13, subdivision 2, and any additional area 
designated under section 13, subdivision 3. 
    Subd. 11.  [TARGETED NEIGHBORHOOD MONEY.] "Targeted 
neighborhood money" means the money designated in the 
revitalization program to be used to implement the 
revitalization program. 
    Subd. 12.  [TARGETED NEIGHBORHOOD REVITALIZATION AND 
FINANCING PROGRAM.] "Targeted neighborhood revitalization and 
financing program," "revitalization program," or "program" means 
the targeted neighborhood revitalization and financing program 
adopted in accordance with section 14. 
    Sec. 13.  [469.202] [DESIGNATION OF TARGETED 
NEIGHBORHOODS.] 
    Subdivision 1.  [CITY AUTHORITY.] A city may by resolution 
designate targeted neighborhoods within its borders after 
adopting detailed findings that the designated neighborhoods 
meet the eligibility requirements in subdivision 2 or 3. 
    Subd. 2.  [ELIGIBILITY REQUIREMENTS FOR TARGETED 
NEIGHBORHOODS.] An area within a city is eligible for 
designation as a targeted neighborhood if the area meets two of 
the following three criteria: 
    (a) The area had an unemployment rate that was twice the 
unemployment rate for the Minneapolis and Saint Paul standard 
metropolitan statistical area as determined by the 1980 federal 
decennial census. 
    (b) The median household income in the area was no more 
than half the median household income for the Minneapolis and 
Saint Paul standard metropolitan statistical area as determined 
by the 1980 federal decennial census. 
    (c) The area is characterized by residential dwelling units 
in need of substantial rehabilitation.  An area qualifies under 
this paragraph if 25 percent or more of the residential dwelling 
units are in substandard condition as determined by the city, or 
if 70 percent or more of the residential dwelling units in the 
area were built before 1940 as determined by the 1980 federal 
decennial census. 
    Subd. 3.  [ADDITIONAL AREA ELIGIBLE FOR INCLUSION IN 
TARGETED NEIGHBORHOOD.] (a) A city may add to the area 
designated as a targeted neighborhood under subdivision 2 
additional area extending up to four contiguous city blocks in 
all directions from the designated targeted neighborhood.  For 
the purpose of this subdivision, "city block" has the meaning 
determined by the city; or 
    (b) The city may enlarge the targeted neighborhood to 
include portions of a census tract that is contiguous to a 
targeted neighborhood, provided that the city council first 
determines the additional area satisfies two of the three 
criteria in subdivision 2.  
    Sec. 14.  [469.203] [TARGETED NEIGHBORHOOD REVITALIZATION 
AND FINANCING PROGRAM REQUIREMENTS.] 
    Subdivision 1.  [COMPREHENSIVE REVITALIZATION AND FINANCING 
PROGRAM.] For each targeted neighborhood for which a city 
requests state financial assistance under section 15, the city 
must prepare a comprehensive revitalization and financing 
program that includes the following: 
    (1) the revitalization objectives of the city for the 
targeted neighborhood; 
    (2) the specific activities or means by which the city 
intends to pursue and implement the revitalization objectives; 
    (3) the extent to which the activities identified in clause 
(2) will benefit low- and moderate-income families, will 
alleviate the blighted condition of the targeted neighborhood, 
or will otherwise assist in the revitalization of the targeted 
neighborhood; 
    (4) a statement of the intended outcomes to be achieved by 
implementation of the revitalization program, how the outcomes 
will be measured both qualitatively and quantitatively, and the 
estimated time over which they will occur; and 
    (5) a financing program and budget that identifies the 
financial resources necessary to implement the revitalization 
program, including:  
    (i) the estimated total cost to implement the 
revitalization program; 
    (ii) the estimated cost to implement each activity in the 
revitalization program identified in clause (2); 
    (iii) the estimated amount of financial resources that will 
be available from all sources other than from the appropriation 
available under section 15 to implement the revitalization 
program, including the amount of private investment expected to 
result from the use of public money in the targeted 
neighborhood; 
    (iv) the estimated amount of the appropriation available 
under section 15 that will be necessary to implement the 
revitalization program; 
    (v) a description of the activities identified in the 
revitalization program for which the state appropriation will be 
committed or spent; and 
    (vi) a statement of how the city intends to meet the 
requirement for a financial contribution from city matching 
money in accordance with section 15, subdivision 3. 
    Subd. 2.  [TARGETED NEIGHBORHOOD PARTICIPATION IN PREPARING 
REVITALIZATION PROGRAM.] A city requesting state financial 
assistance under section 15 shall adopt a process to involve the 
residents of targeted neighborhoods in the development, 
drafting, and implementation of the revitalization program.  The 
process shall include the use of a citizen participation process 
established by the city.  A description of the process must be 
included in the program.  The process to involve residents of 
the targeted neighborhood must include at least one public 
hearing.  The city of Minneapolis shall establish the 
community-based process as outlined in subdivision 3.  The city 
of St. Paul shall use the same community-based process the city 
used in planning, developing, drafting, and implementing the 
revitalization program required under Laws 1987, chapter 386, 
article 6, section 6.  The city of Duluth shall use the same 
citizen participation process the city used in planning, 
developing, and implementing the federal funded community 
development program. 
    Subd. 3.  [COMMUNITY PARTICIPATION; MINNEAPOLIS.] (a) For 
the purposes of this subdivision, "city" means the city of 
Minneapolis.  
    (b) The city shall adopt a process to involve the residents 
in targeted neighborhoods and assisted housing in planning, 
developing, and implementing the program.  As part of this 
process, the city shall ensure that the community-based process 
has sufficient resources to assist in the development of the 
program and that the advisory board is established. 
    (c) Beginning with the program for 1991, each targeted 
neighborhood or group of targeted neighborhoods in the city must 
have a strategic planning group whose members include residents 
of the targeted neighborhood and representatives of institutions 
in the neighborhood.  The group shall, as part of its 
responsibilities, develop a strategic plan for the 
neighborhood.  This strategic plan must include the elements 
that the planning group recommends as part of the program.  The 
strategic plan must also address how the targeted neighborhood 
portions of the revitalization program will be integrated with 
the elements that are recommended to be included as part of the 
community resources program if such a program is developed in 
the city.  If possible, the city shall integrate the community 
participation process required under this subdivision with the 
community participation process required for the development of 
the community resources program if such a program is developed 
in the city. 
    (d) The city shall ensure that the strategic planning group 
required under paragraph (c) is established.  An existing group 
or organization that reflects the required membership under 
paragraph (c) may be designated as the strategic planning 
group.  The city may provide financial and staff resources to 
ensure the establishment of the strategic planning groups, and 
may use part of the money received from the state under section 
15 to assist in the establishment of the targeted neighborhood 
strategic planning groups. 
    (e) As part of the process for the development of the 
program, each targeted neighborhood strategic planning group 
shall submit assigned priority recommendations for the 
revitalization program to the city and the advisory board 
established under paragraph (f). 
    (f) The city shall establish an urban revitalization action 
program advisory committee to assist the city in developing and 
implementing the preliminary revitalization program.  The 
advisory committee shall consist of at least two representatives 
of the city council appointed by the city council, one or more 
for-profit or nonprofit housing developers, one or more 
representatives of the business community appointed by the 
city's chamber of commerce, and resident representatives of the 
targeted neighborhoods.  The representatives of the targeted 
neighborhoods shall represent a majority of the membership of 
the advisory committee and reflect the geographic, cultural, 
racial, and ethnic diversity of the targeted neighborhoods.  The 
city may determine the size of the advisory committee and may 
designate an existing entity as the advisory committee if the 
entity meets the membership requirements outlined in this 
subdivision. 
    (g) The advisory committee shall work closely with city 
staff in developing and drafting the preliminary revitalization 
program.  The advisory committee shall be involved in assessing 
needs, prioritizing funds, and developing criteria for 
evaluating program proposals.  In developing the preliminary 
program, the advisory committee shall give consideration to the 
recommendations made by the targeted neighborhood strategic 
planning groups.  
    (h) The advisory committee shall conduct a public hearing 
and secure input from residents of targeted neighborhoods, 
business persons, governmental units affected by the program, 
and other organizations and persons. 
    (i) The advisory committee and city staff may make any 
changes to the preliminary program resulting from testimony 
given at the public hearing.  The advisory committee must 
formally recommend to the city council a preliminary 
revitalization program. 
    Subd. 4.  [CITY APPROVAL OF PROGRAM.] (a) For the purposes 
of this subdivision, "city" means the cities of Minneapolis and 
Duluth.  
    (b) Before adoption of a revitalization program under 
paragraph (c), the city must submit a preliminary program to the 
commissioner, the state planning agency, and the Minnesota 
housing finance agency for their comments.  The city may not 
adopt the revitalization program until comments have been 
received from the state agencies or 30 days have elapsed without 
response after the program was sent to them.  Comments received 
by the city from the state agencies within the 30-day period 
must be responded to in writing by the city before adoption of 
the program by the city. 
    (c) The city may adopt a revitalization program only after 
holding a public hearing after the program has been prepared.  
Notice of the hearing must be provided in a newspaper of general 
circulation in the city and in the most widely circulated 
community newspaper in the targeted neighborhoods not less than 
ten days nor more than 30 days before the date of the hearing. 
    (d) A certification by the city that a revitalization 
program has been approved by the city council for the targeted 
neighborhood must be provided to the commissioner together with 
a copy of the program.  A copy of the program must also be 
provided to the Minnesota housing finance agency and the state 
planning agency. 
    (e) A revitalization program for the city may be modified 
at any time by the city council after a public hearing, notice 
of which is published in a newspaper of general circulation in 
the city and in the targeted neighborhood at least ten days nor 
more than 30 days before the date of the hearing.  If the city 
council determines that the proposed modification is a 
significant modification to the program originally certified 
under paragraph (d), the city council shall implement the 
revitalization program approval and certification process of 
this subdivision for the proposed modification.  
    Subd. 5.  [CITY OF SAINT PAUL APPROVAL.] (a) 
Notwithstanding any other law, including laws passed by the 1989 
legislature, the city of St. Paul must use the process under 
this subdivision for developing and certifying an urban 
revitalization action program.  
    (b) For the purposes of this subdivision, "city" means the 
city of Saint Paul. 
    (c) A city may approve a preliminary revitalization program 
developed through a process that includes the citizen 
participation required under subdivision 2 only after holding a 
public hearing.  Notice of the hearing must be provided in a 
newspaper of general circulation in the city and in the targeted 
neighborhoods not less than ten days nor more than 30 days 
before the date of the hearing.  After the public hearing and 
after the city has incorporated any changes into the preliminary 
program as a result of the public hearing, the city may approve 
the preliminary program and shall submit the approved 
preliminary program for final approval to the review board. 
    (d) After approval, the city shall submit the preliminary 
program to the commissioner, the state planning agency, and the 
Minnesota housing finance agency for their comments.  The state 
agencies have 30 days to provide comments to the preliminary 
program.  State agency comments must be submitted in writing to 
the review board established under paragraph (e). 
    (e) The city shall establish a city urban revitalization 
action program review board whose purpose is to review the 
preliminary program submitted by the city, and approve all or 
portions of the program.  The review board consists of two city 
council members who represent targeted neighborhoods, two 
members representing the city's business community appointed by 
the chamber of commerce representing businesses in the city, and 
three residents of targeted neighborhoods appointed by the city 
council.  Two members of the house of representatives and one 
member of the state senate appointed by the city's legislative 
delegation shall be nonvoting members of the review board.  
Nonvoting legislative members of the review board shall 
represent targeted neighborhoods.  A member of the review board 
may not be an elected public official, or in any way be involved 
in preparing or implementing the program or any portion of the 
program.  The review board may require the city to contract for 
staff assistance in reviewing and approving the program.  
Persons who provide staff assistance to the review board may not 
be city employees or in any way involved in a formal or informal 
organization representing residents of a targeted neighborhood.  
The city may use state money available under section 15 to pay 
for the costs of staffing the review board. 
    (f) The review board shall review the city's preliminary 
program and approve all or portions of the program.  In 
reviewing the program, the review board shall take into account 
any comments submitted by state agencies under paragraph (d).  
The review board may only reject the revitalization program or 
portions of the program for the following reasons: 
    (1) the revitalization program does not include the 
information required under subdivision 1; 
    (2) the city did not follow the community-based process 
required under subdivision 2 for developing the revitalization 
program; or 
    (3) the revitalization program results in undue 
concentration of targeted neighborhood money in a single 
proposed activity or project. 
The review board may approve all of the preliminary program and 
submit it to the city council for certification under paragraph 
(g) or submit for certification only those specific portions of 
the program approved by the review board.  If the review board 
does not approve a portion of the program, it shall specify in 
writing to the city the reasons for not approving that portion 
of the program and any recommendations for changes.  If the 
review board determines that a portion of the program needs 
significant changes, it may require the city to implement the 
community participation process under subdivision 2 and state 
review under this subdivision for making changes to that portion 
of the program. 
    (g) The city council may, by formal resolution, certify 
only those portions of a program approved by the review board 
under paragraph (f).  A certification by the city council that 
all or portions of a revitalization program has been approved by 
the review board must be provided to the commissioner together 
with a copy of the approved portions of the program.  A copy of 
the approved portions of the program must be submitted to the 
state planning agency and Minnesota housing finance agency. 
    (h) A revitalization program may be modified at any time by 
the city after a public hearing and approval by the review 
board.  Notice of the public hearing must be published in a 
newspaper of general circulation in the city and in the targeted 
neighborhoods not less than ten days nor more than 30 days 
before the date of the hearing.  If the review board determines 
that the proposed modification is a significant modification to 
the program originally certified under paragraph (g), it must 
require the implementation of the revitalization program 
approval and certification process under this subdivision for 
the proposed modification. 
    Sec. 15.  [469.204] [PAYMENT; CITY MATCHING MONEY; 
DRAWDOWN; USES OF STATE MONEY.] 
    Subdivision 1.  [PAYMENT OF STATE MONEY.] Upon receipt from 
a city of a certification that a revitalization program has been 
adopted or modified, the commissioner shall, within 30 days, pay 
to the city the amount of state money identified as necessary to 
implement the revitalization program or program modification.  
State money may be paid to the city only to the extent that the 
appropriation limit for the city specified in subdivision 2 is 
not exceeded.  Once the state money has been paid to the city, 
it becomes targeted neighborhood money for use by the city in 
accordance with an adopted revitalization program and subject 
only to the restrictions on its use in sections 12 to 18. 
    Subd. 2.  [ALLOCATION.] Each city of the first class, as 
defined in section 410.01, may receive a part of the 
appropriations made available that is the proportion that the 
population of such city bears to the combined population of such 
cities of the first class.  One city may agree to reduce its 
entitlement amount and to make it available to another city.  
For the purposes of this subdivision the population of each city 
is determined according to the most recent estimates available 
to the commissioner.  Interest earned by a city from money paid 
to the city must be repaid to the commissioner annually unless 
the revitalization program identifies the interest as necessary 
to implement the revitalization program and the requirement for 
city matching money is satisfied with respect to the interest. 
    Subd. 3.  [CITY MATCHING MONEY; DRAWDOWN AND RESTRICTION ON 
USE OF STATE MONEY.] A city may spend state money only if the 
revitalization program identifies city matching money to be used 
to implement the program in an amount equal to the state 
appropriation paid to the city.  A city must keep the state 
money in a segregated fund for accounting purposes. 
    Sec. 16.  [469.205] [CITY POWERS AND ELIGIBLE USES OF 
TARGETED NEIGHBORHOOD MONEY.] 
    Subdivision 1.  [CONSOLIDATION OF EXISTING POWERS IN 
TARGETED NEIGHBORHOODS.] A city may exercise any of its 
corporate powers within a targeted neighborhood.  Those powers 
shall include, but not be limited to, all of the powers 
enumerated and granted to any city by chapters 462C, 469, and 
474A.  For the purposes of sections 469.048 to 469.068, a 
targeted neighborhood is considered an industrial development 
district.  A city may exercise the powers of chapters 469.048 to 
469.068 in conjunction with, and in addition to, exercising the 
powers granted by sections 469.001 to 469.047 and chapter 462C, 
in order to promote and assist housing construction and 
rehabilitation within a targeted neighborhood.  For the purposes 
of section 462C.02, subdivision 9, a targeted neighborhood is 
considered a "targeted area." 
    Subd. 2.  [GRANTS AND LOANS.] In addition to the authority 
granted by other law, a city may make grants, loans, and other 
forms of public assistance to individuals, for-profit and 
nonprofit corporations, and other organizations to implement a 
revitalization program.  The public assistance must contain the 
terms the city considers proper to implement a revitalization 
program. 
    Subd. 3.  [ELIGIBLE USES OF TARGETED NEIGHBORHOOD 
MONEY.] The city may spend targeted neighborhood money for any 
purpose authorized by subdivision 1 or 2, except that an amount 
equal to at least 50 percent of the state payment under section 
15 made to the city must be used for housing activities. Use of 
target neighborhood money must be authorized in a revitalization 
program. 
    Sec. 17.  [469.206] [HAZARDOUS PROPERTY PENALTY.] 
    A city may assess a penalty up to one percent of the market 
value of real property, including any building located within 
the city that the city determines to be hazardous as defined in 
section 463.15, subdivision 3.  The city shall send a written 
notice to the address to which the property tax statement is 
sent at least 90 days before it may assess the penalty.  If the 
owner of the property has not paid the penalty or fixed the 
property within 90 days after receiving notice of the penalty, 
the penalty is considered delinquent and is increased by 25 
percent each 60 days the penalty is not paid and the property 
remains hazardous.  For the purposes of this section, a penalty 
that is delinquent is considered a delinquent property tax and 
subject to Minnesota Statutes, chapters 279, 280, and 281, in 
the same manner as delinquent property taxes. 
    Sec. 18.  [469.207] [ANNUAL AUDIT AND REPORT.] 
    Subdivision 1.  [ANNUAL FINANCIAL AUDIT.] In 1989 and 
subsequent years, at the end of each calendar year, the 
legislative auditor shall conduct a financial audit to review 
the spending of state money under sections 12 to 18.  Before 
spending state money to implement a revitalization program, the 
city must consult with the legislative auditor to determine 
appropriate accounting methods and principles that will assist 
the legislative auditor in conducting its financial audit.  The 
results of the financial audit must be submitted to the 
legislative audit commission, the commissioner, the state 
planning agency, and the Minnesota housing finance agency. 
    Subd. 2.  [ANNUAL REPORT.] A city that begins to implement 
a revitalization program in a calendar year must, by March 1 of 
the succeeding calendar year, provide a detailed report on the 
revitalization program or programs being implemented in the 
city.  The report must describe the status of the program 
implementation and analyze whether the intended outcomes 
identified in section 14, subdivision 1, clause (4), are being 
achieved.  The report must include at least the following: 
    (1) the number of housing units, including lost units, 
removed, created, lost, replaced, relocated, and assisted as a 
result of the program.  The level of rent of the units and the 
income of the households affected must be included in the 
report; 
    (2) the number and type of commercial establishments 
removed, created, and assisted as a result of a revitalization 
program.  The report must include information regarding the 
number of new jobs created by category, whether the jobs are 
full-time or part-time, and the salary or wage levels of both 
new and expanded jobs in the affected commercial establishments; 
    (3) a description of a statement of the cost of the public 
improvement projects that are part of the program and the number 
of jobs created for each $20,000 of money spent on commercial 
projects and applicable public improvement projects; 
    (4) the increase in the tax capacity for the city as a 
result of the assistance to commercial and housing assistance; 
and 
    (5) the amount of private investment that is a result of 
the use of public money in a targeted neighborhood. 
    The report must be submitted to the commissioner, the 
Minnesota housing finance agency, the state planning agency, and 
the legislative audit commission, and must be available to the 
public. 
    Sec. 19.  [REVITALIZATION PROGRAM MONITORING.] 
    The commissioner of the state planning agency, in 
consultation with other appropriate state agencies, shall 
monitor the planning, development and implementation of the 
urban revitalization action program.  The commissioner shall 
determine if: 
    (1) the process used for developing the programs is 
providing adequate neighborhood participation in the planning, 
drafting and implementation of the programs; 
    (2) the programs are effectively achieving the statutory 
objectives and the objectives outlined in the programs 
themselves; and 
    (3) private funding is being used to partially fund the 
activities established under the programs. 
    The state planning agency shall provide an interim report 
to the legislature by January 1, 1990, with a final report of 
its findings due by January 1, 1991. 
    Sec. 20.  [COMMUNITY SOCIAL AND ECONOMIC NEEDS.] 
    The commissioner of the state planning agency, in 
consultation with representatives of cities, counties, and 
school districts, shall identify significant social and economic 
needs in the communities throughout the state, including the 
future needs of the cities of the first class.  The 
identification of the needs must be done on a county by county 
basis using demographic characteristics that will allow social 
and economic needs to be thoroughly demonstrated.  When 
possible, the commissioner shall also identify the needs of all 
cities with populations of 2,500 or more people. 
    The demographic, economic, and other data utilized in 
identifying the social and economic needs shall be maintained in 
a data base that is accessible to legislators, researchers, and 
representatives of local governments.  The commissioner shall 
provide an interim report on its findings to the legislature by 
January 1, 1990, with a final report by January 1, 1991. 
    Sec. 21.  [REPEALER.] 
    Laws 1987, chapter 386, article 6, sections 4, 5, 6, 7, 8, 
9, 10 and 11, and Laws 1987, chapter 384, article 3, section 22, 
are repealed, provided that actions taken under those provisions 
prior to the effective date of this chapter with respect to any 
program or to a targeted neighborhood are ratified and affirmed 
and must be treated as if validly taken under the provisions of 
sections 12 to 18. 
    Sec. 22.  [EFFECTIVE DATE.] 
    Sections 12 to 18 and 21 are effective the day after final 
enactment, provided that the provisions of sections 12 to 15 and 
16, subdivisions 2 and 3, shall not apply to any program funded 
by the state in fiscal year 1988. 

                               ARTICLE 7 

                  YOUTH EMPLOYMENT AND HOUSING PROGRAM 
    Section 1.  Minnesota Statutes 1988, section 268.361, 
subdivision 4, is amended to read: 
    Subd. 4.  [ELIGIBLE ORGANIZATION.] "Eligible organization" 
means a public agency or a nonprofit organization that can 
demonstrate an ability to design implement a program for 
education and training services provided to targeted youth.  
Eligible organizations may include local jurisdictions, public 
school districts, private nonsectarian schools, post-secondary 
educational institutes, alternative schools, community groups, 
and labor organizations. 
    Sec. 2.  Minnesota Statutes 1988, section 268.361, is 
amended by adding a subdivision to read: 
    Subd. 4a.  [PROGRAM.] "Program" means the services and 
activities performed or contracted for by an eligible 
organization for which a grant has been received or for which a 
grant application has been submitted to the commissioner. 
    Sec. 3.  Minnesota Statutes 1988, section 268.362, is 
amended to read: 
    268.362 [PLANNING GRANTS.] 
    The commissioner shall make grants of up to $20,000 to 
eligible organizations for the design of programs to provide 
education and training services to targeted youth.  The purpose 
of these programs is to provide specialized training and work 
experience to at-risk targeted youth who have not been served 
effectively by the current educational system.  The programs are 
to be designed to include a work experience component with work 
projects that result in the rehabilitation or construction of 
residential units for the homeless.  Two or more eligible 
organizations may jointly apply for a planning grant.  The 
commissioner shall administer the grant program. 
    Interested eligible organizations must apply to the 
commissioner for the grants.  The advisory committee must review 
the applications and provide to the commissioner a list of 
recommended eligible organizations that the advisory committee 
determines meet the requirements for receiving a planning 
grant.  The commissioner shall select from the committee's list 
at least four organizations to receive the planning grants with 
at least one organization located in each of the cities of 
Minneapolis and St. Paul and two organizations located outside 
the metropolitan area defined in section 473.121, subdivision 2. 
    Sec. 4.  Minnesota Statutes 1988, section 268.364, is 
amended to read: 
    268.364 [PROGRAM PURPOSE AND DESIGN.] 
    Subdivision 1.  [PROGRAM PURPOSE.] The grants awarded under 
section 268.362 are for the design of a youth employment and 
training program directed at targeted youth who are likely to be 
at risk of not completing their high school education.  Each 
program design must include education, work experience, and job 
skills components. 
    Subd. 2.  [EDUCATION COMPONENT.] A program design must 
contain an education component that requires program 
participants who have not completed to complete their secondary 
education to be enrolled in a traditional public or private 
secondary school, a suitable alternative school setting, or a 
GED program.  Program participants must be working toward the 
completion of their secondary education or literacy advancement. 
    Subd. 3.  [WORK EXPERIENCE COMPONENT.] A work experience 
component must be included in each program design.  The work 
experience component must provide vocational skills training in 
an industry where there is a viable expectation of job 
opportunities and a training subsidy or stipend may be provided 
to program participants.  The wage or stipend must be provided 
to participants who are recipients of public assistance in a 
manner or amount which will not reduce public assistance 
benefits.  The work experience component must be designed so 
that work projects result in the expansion or improvement of 
residential units for homeless persons and very low income 
families, and must include direct supervision by individuals 
skilled in each specific vocation.  The program design must 
include an examination of how Program participants may earn 
credits toward the completion of their secondary education from 
their participation in the work experience component. 
    Subd. 4.  [JOB READINESS SKILLS COMPONENT.] A job readiness 
skills component must be included in each program design.  The 
component must provide program participants with job search 
skills, placement assistance, and other job readiness skills to 
ensure that participants will be able to compete in the 
employment market. 
    Subd. 5.  [ELIGIBLE PROGRAM PROVIDERS.] A program design 
must include the examination of the types of organizations that 
would administer and operate the program.  The types of 
organizations examined must include public school districts, 
private nonsectarian schools, alternative schools, local 
jurisdictions, housing related groups, community groups, and 
labor organizations, or a joint effort among two or more of 
these organizations. 
    Sec. 5.  Minnesota Statutes 1988, section 268.365, is 
amended to read: 
    268.365 [HOUSING FOR HOMELESS.] 
    Subdivision 1.  [WORK PROJECT REQUIREMENT.] The work 
experience component of the youth employment and training 
program described in section 268.364 must include work projects 
that provide residential units through construction or, 
rehabilitation, or improvement for the homeless and families 
with very low incomes. 
    Subd. 2.  [PRIORITY FOR HOUSING.] Any residential units 
that become available through the employment and training 
program must be allocated in the following order: 
    (1) homeless families with at least one dependent; 
    (2) other homeless individuals; 
    (3) other very low income families and individuals; and 
    (4) families or individuals that receive public assistance 
and that do not qualify in any other priority group. 
    Subd. 3.  [ACQUISITION OF HOUSING UNITS.] The program 
design must include an examination of the means of acquiring 
eligible organization receiving a grant under section 268.362 
shall acquire property or buildings for the construction or 
rehabilitation of residential units at the lowest possible 
cost.  The examination must include the review of Possible 
sources of property and funding through federal, state, or local 
agencies, including include the federal Department of Housing 
and Urban Development, Farmers Home Administration, Minnesota 
housing finance agency, and the local housing authority. 
    Subd. 4.  [MANAGEMENT OF RESIDENTIAL UNITS.] The 
program design must address how to manage these residential 
units, including the source of financing for the maintenance 
costs of the buildings.  Any management plan must include the 
participation of the residents and local established 
neighborhood groups. 
    Sec. 6.  Minnesota Statutes 1988, section 268.366, is 
amended to read: 
    268.366 [REQUIREMENTS OF ORGANIZATIONS RECEIVING GRANTS.] 
    An organization that is awarded a planning grant under 
section 268.362 shall prepare and submit a an annual report to 
the commissioner by January 15, 1989 September 1 of each year.  
The report must address each include a discussion of the 
following: 
    (1) the method process used for encouraging the 
participation of the targeted youth in the geographic area 
surrounding the organization receiving the grant; 
    (2) the support services and social services that targeted 
youth require and the means of providing those services to 
program participants received under the program.  Services may 
include client needs assessment, preemployment skills such as 
basic job skills and behavior, and intermediate needs such as 
education and chemical dependency treatment; 
    (3) the type and degree of work experience that program 
participants must participate in received, including real work 
experience in both vocational and nonvocational settings; 
    (4) the amount of training subsidy or stipend that each 
participant should receive received while participating in the 
work experience component.  The subsidy or stipend must reflect 
prevailing wage and benefits standards appropriate for 
preapprenticeship training unless a participant's receipt of 
public assistance is affected.  The subsidy or stipend should be 
structured to include incentives for progress toward increasing 
job skills and completing secondary education; 
    (5) the identification and means of providing the necessary 
job readiness skills so that to program participants who have 
completed the work experience and educational components of the 
program may have so they have the ability to compete in the job 
market.  These job search skills may include skills assessment, 
job search and selection, application preparation and assistance 
in preparing for job interviews; 
    (6) the methods that may be used to assist in placing 
program participants in suitable employment.  The methods should 
include means of involving state government, businesses, labor 
organizations, community groups, and local jurisdictions in 
assisting in the placement; 
    (7) a plan the process used for evaluating the program, 
including the necessary data elements that must be collected 
from program participants after they have completed the 
program to monitor for monitoring the success of the program; 
    (8) the method used to maximize parental involvement in the 
program; 
    (9) the identification of existing public and private 
programs that may be were utilized by the program to avoid 
duplication of services; 
    (10) the identification of regional characteristics that 
may affect affected the operation of the program in the specific 
region where the organization is located; 
    (11) the identification and means of addressing the special 
needs of priority groups of targeted youth, which groups may 
include including: 
    (i) persons who are responsible for at least one dependent; 
    (ii) persons who are pregnant; 
    (iii) persons who are or have been subject to any stage of 
the criminal justice system and who may benefit from receiving 
employment and training services in overcoming barriers to 
employment resulting from a record of arrest or conviction; 
    (iv) persons receiving income maintenance services and 
social services, including chemical dependency treatment, 
vocational rehabilitation services, and protection services; 
    (v) persons who reside on a farm who personally derive or 
whose family derives a substantial portion of their income from 
farming, lack nonfarm work skills, or have limited access to 
vocational education or work experience opportunities; 
    (vi) homeless youth; and 
    (vii) minors who that are not financially dependent on a 
parent or a guardian; 
    (12) cost estimates costs for each of the components of the 
program; and 
    (13) the identification of the funding sources other than 
state appropriations that may be were used to support the 
program. 
    Sec. 7.  Minnesota Statutes 1988, section 268.367, is 
amended to read: 
    268.367 [REPORT.] 
    The commissioner shall prepare and submit a an annual 
report to the legislature and the governor by February January 
15, 1989 of each year, that outlines the various program designs 
summarizes the annual reports submitted by the organizations 
that received planning grants.  The report must may also include 
recommendations on which components of the improving the program 
designs are most suitable to meeting to better meet the needs of 
targeted youth.  The advisory committee must participate in the 
preparation of this report and in the formulation of the any 
recommendations. 
    Sec. 8.  [1990 REPORT.] 
    The annual report for 1990 required under Minnesota 
Statutes, section 268.367, must include specific recommendations 
on whether the program should be continued on a permanent basis 
and, if continued, the state agency that should administer the 
program.  In preparing this report and the recommendations, the 
commissioner of the state planning agency must consult with the 
eligible organization receiving a grant under section 9 and the 
advisory committee. 
    Sec. 9.  [DEMONSTRATION GRANTS.] 
    Notwithstanding Minnesota Statutes, section 268.362, the 
commissioner of the state planning agency shall award two 
demonstration grants to eligible organizations, as defined in 
Minnesota Statutes, section 268.361, subdivision 4, based on 
criteria established in the report required under Laws 1988, 
chapter 686, article 3, section 7.  To achieve a demonstration 
grant under this section, the eligible organization must match 
the grant money with at least an equal amount of nonstate 
money.  The commissioner of finance must verify that the 
eligible organization has matched the grant money. 

                               ARTICLE 8

                         HOUSING IMPACT REPORT
    Section 1.  [504.33] [DEFINITIONS.] 
    Subdivision 1.  [SCOPE.] The definitions in this section 
apply to sections 1 to 3. 
    Subd. 2.  [CITY.] "City" means a city of the first class as 
defined in section 410.01.  The term "city" also includes, where 
applicable, a port authority, economic development authority, a 
housing and redevelopment authority, or any development agency 
established under chapter 469 which share common boundaries with 
the city. 
    Subd. 3.  [DISPLACE.] "Displace" means to demolish, acquire 
for or convert to a use other than low-income housing, or to 
provide or spend money that directly results in the demolition, 
acquisition, or conversion of housing to a use other than 
low-income housing. 
    "Displace" does not include providing or spending money 
that directly results in:  (i) housing improvements made to 
comply with health, housing, building, fire prevention, housing 
maintenance, or energy codes or standards of the applicable 
government unit; (ii) housing improvements to make housing more 
accessible to a handicapped person; or (iii) the demolition, 
acquisition, or conversion of housing for the purpose of 
creating owner-occupied housing that consists of no more than 
four units per structure. 
    Subd. 4.  [GOVERNMENT UNIT.] "Government unit" means a 
state agency; a public or private agency, corporation, or entity 
receiving a direct appropriation from the state for the purpose 
of a project that would displace low-income housing in a city; 
or a general or special purpose unit of government in the state, 
including a city, county, and county housing and redevelopment 
authority. 
    Subd. 5.  [LOW-INCOME HOUSING.] "Low-income housing" means 
rental housing with a rent less than or equal to 30 percent of 
50 percent of the median income for the county in which the 
rental housing is located, adjusted by size. "Low-income 
housing" also includes rental housing that has been vacant for 
less than two years, that was low-income housing when it was 
last occupied, and that is not condemned as being unfit for 
human habitation by the applicable government unit. 
    Subd. 6.  [RENTAL HOUSING.] "Rental housing" includes 
rental apartments, rooms, and housing; board and lodging units; 
rooms in single-occupancy buildings and hotels that offer to be 
used as the sole residence of the occupant; transitional 
housing; and shelters.  Rental housing does not include 
transitional housing located within a floodplain or community 
based residential facilities. 
    Subd. 7.  [REPLACEMENT HOUSING.] "Replacement housing" 
means rental housing that is: 
    (1) the lesser of (i) the number and corresponding size of 
low-income housing units displaced, or (ii) sufficient in number 
and corresponding size of those low-income housing units 
displaced to meet the demand for those units; 
    (2) low-income housing for the greater of 15 years or the 
compliance period of the federal low-income housing tax credit 
under United States Code, title 26, section 42(i)(1), as 
amended.  This section does not prohibit increases in rent to 
cover operating expenses; 
    (3) in at least standard condition; and 
    (4) located in the city where the displaced low-income 
housing units were located. 
    Replacement housing may be provided as newly constructed 
housing, or rehabilitated or rent subsidized existing housing 
that does not already qualify as low-income housing. 
    Subd. 8.  [SIZE.] "Size" means the number of bedrooms in a 
housing unit. 
    Sec. 2.  [504.34] [ANNUAL HOUSING IMPACT REPORT.] 
    Subdivision 1.  [ANNUAL REPORT REQUIRED.] A government unit 
shall prepare an annual housing impact report for each year in 
which the government unit displaces ten or more units of 
low-income housing in a city of the first class as defined in 
section 410.01. 
    Subd. 2.  [DRAFT ANNUAL HOUSING IMPACT REPORT.] A 
government unit subject to this section must prepare a draft 
annual housing impact report for review and comment by 
interested persons.  The draft report must be completed by 
January 31 of the year immediately following a year in which the 
government unit has displaced ten or more units of low-income 
housing in a city.  
    Subd. 3.  [CONTENTS.] The draft and final annual housing 
impact reports must include: 
    (1) identification of each low-income housing unit that was 
displaced in the previous year in the city where housing was 
displaced by the government unit, including the unit's address, 
size, and rent; the number of persons who could have occupied 
the unit; the condition the unit was in, and whether it was 
habitable at the time of displacement; the owner of the unit; 
whether it was owner occupied; and how and when it was 
displaced; 
    (2) identification of each unit of replacement housing 
provided in the previous year in the city, including the unit's 
address, size, and rent; the number of persons who could occupy 
the unit; the owner of the unit; whether it is owner occupied; 
and an identification of the displaced low-income housing unit 
that was replaced by the unit of replacement housing; 
    (3) analysis of the supply of and demand for all sizes of 
low-income housing units, by size and rent, in the city; 
    (4) determination of whether there is an adequate supply of 
available and unoccupied low-income housing units to meet the 
demand for all sizes of low-income housing, by size and rent, in 
the city where housing has been displaced by the government 
unit; 
    (5) estimation of the cost of providing replacement housing 
for low-income housing not in adequate supply to meet the demand 
for all sizes of low-income housing, by size and rent, in the 
city where housing has been displaced by the government unit; 
and 
    (6) analysis of the government unit's compliance with the 
replacement plans of previous housing annual impact reports and 
project housing impact statements. 
    Subd. 4.  [REPLACEMENT PLAN.] If there is an inadequate 
supply of available and unoccupied low-income housing units to 
meet the demand for the replacement housing in the city where 
housing has been displaced by the government unit, the draft and 
final annual housing impact reports must include a plan for 
providing the replacement housing within 36 months following the 
date of the final annual housing impact report. 
    Subd. 5.  [NOTICE; REQUEST FOR COMMENTS.] A government unit 
subject to this section must provide for public input in 
preparing the annual housing impact report, including a public 
comment period and a public hearing.  The government unit must 
publish notice of its draft annual housing impact report in a 
newspaper of general circulation in the city by the deadline for 
completion of the draft annual housing impact report.  The 
notice must include a request for comments on the draft annual 
housing impact report within the 30 days following the notice, 
and the date, time, and location of the public hearing on the 
draft annual housing impact report, to be held within 15 to 30 
days following the date of notice.  Copies of the notice must be 
sent to the neighborhood and citizen participation 
organizations, district planning councils, housing referral and 
information services, shelters, homeless and tenants advocacy 
groups, and legal aid offices in the city where the displaced 
low-income housing was located.  Copies of the notice and the 
draft annual housing impact report must be submitted to the 
state planning agency and the Minnesota housing finance agency. 
    Subd. 6.  [FINAL ANNUAL HOUSING IMPACT REPORT.] In 
preparing and approving a final annual housing impact report, a 
government unit subject to this section must consider comments 
received during the comment period and at the public hearing on 
the draft report.  The final report shall be prepared within 30 
days following the deadline for receipt of comments on the draft 
annual housing impact report.  The government unit shall publish 
notice of the final annual housing impact report in a newspaper 
of general circulation in the city.  Copies of the notice must 
be sent to neighborhood and citizen participation organizations, 
district planning councils, housing referral and information 
services, shelters, homeless and tenants advocacy groups, and 
legal aid offices in the city where the displaced low-income 
housing was located.  Copies of the notice and the draft annual 
housing impact report must be submitted to the state planning 
agency and the Minnesota housing finance agency. 
    Sec. 3.  [504.35] [REPLACEMENT HOUSING REQUIRED.] 
    A government unit which displaces ten or more units of 
low-income housing in a city of the first class as defined in 
section 410.01 and is subject to section 2 must provide the 
replacement housing within 36 months following the date of the 
final annual housing impact report, unless there is an adequate 
supply of available and unoccupied low-income housing units to 
meet the demand for the replacement housing in the city where 
housing has been displaced by the government unit. 
    Presented to the governor May 30, 1989 
    Signed by the governor June 2, 1989, 12:10 p.m.