Minnesota Session Laws - 2000, Regular Session

                            CHAPTER 424-H.F.No. 3901 
                  An act relating to housing; housing finance agency; 
                  providing financing mechanisms for the agency; 
                  authorizing agency to make grants or loans under the 
                  community rehabilitation fund account to for-profit 
                  organizations; amending Minnesota Statutes 1998, 
                  section 462A.206, subdivision 4; Minnesota Statutes 
                  1999 Supplement, section 462A.206, subdivision 2; 
                  proposing coding for new law in Minnesota Statutes, 
                  chapter 462A. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
           Section 1.  [462A.105] [INTEREST RATE EXCHANGES.] 
           The agency may enter into an agreement with a third party 
        for an exchange of interest rates under this section.  With 
        respect to bonds or notes outstanding or proposed to be issued 
        bearing interest at a variable rate, the agency may agree to pay 
        sums equal to interest at a fixed rate or at a different 
        variable rate determined in accordance with a formula set out in 
        the agreement on an amount not exceeding the outstanding 
        principal amount of the bonds or notes at the time of payment, 
        in exchange for an agreement by the third party to pay sums 
        equal to interest on a like amount at a variable rate determined 
        according to a formula set out in the agreement.  With respect 
        to bonds or notes outstanding or proposed to be issued bearing 
        interest at a fixed rate or rates, the agency may agree to pay 
        sums equal to interest at a variable rate determined according 
        to a formula set out in the agreement on an amount not exceeding 
        the outstanding principal amount of the bonds or notes at the 
        time of payment in exchange for an agreement by the third party 
        to pay sums equal to interest on a like amount at a fixed rate 
        or rates set out in the agreement.  Subject to any applicable 
        covenants of the agency, payments required to be made by the 
        agency under the swap agreement, including termination payments, 
        may be made from amounts pledged or available to pay debt 
        service on the bonds or notes with respect to which the swap 
        agreement was made or from any other available source of the 
        agency.  The agency may issue bonds or notes to provide for any 
        payment, including a termination payment, due or to become due 
        under a swap agreement. 
           Sec. 2.  Minnesota Statutes 1999 Supplement, section 
        462A.206, subdivision 2, is amended to read: 
           Subd. 2.  [AUTHORIZATION.] The agency may make grants or 
        loans to cities or, nonprofit, or for-profit organizations for 
        the purposes of construction, acquisition, rehabilitation, 
        demolition, permanent financing, refinancing, construction 
        financing, gap financing of single housing for homeownership, or 
        full cycle home ownership services, as defined in section 
        462A.209, subdivision 2.  Gap financing is financing for the 
        difference between the cost of the improvement of the blighted 
        property, including acquisition, demolition, rehabilitation, and 
        construction, and the market value of the property upon sale.  
        The agency shall take into account the amount of money that the 
        city or, nonprofit, or for-profit organization leverages from 
        other sources in awarding grants and loans.  The agency shall 
        also consider the extent to which the grant or loan recipient 
        will coordinate use of the funds with its other housing-related 
        efforts or other housing-related efforts in the recipient's 
        geographic area.  In determining whether to award a grant or 
        loan, the agency shall seek to maximize the recycling of state 
        resources wherever appropriate.  The city or, nonprofit, or 
        for-profit organization must indicate in its application how the 
        proposed project is consistent with the consolidated housing 
        plan.  Not less than ten days before submitting its application 
        to the agency, a nonprofit or for-profit organization must 
        notify the city in which the project will be located of its 
        intent to apply for funds.  The city may submit to the agency 
        its written comments on the nonprofit or for-profit 
        organization's application and the agency shall consider the 
        city's comments in reviewing the application.  Cities and, 
        nonprofit, and for-profit organizations may use the grants and 
        loans to establish revolving loan funds and to provide grants 
        and loans to eligible mortgagors.  The city or, nonprofit, or 
        for-profit organization may determine the terms and conditions 
        of the grants and loans.  An agency loan may only be used by a 
        city or, nonprofit, or for-profit organization to make loans. 
           Sec. 3.  Minnesota Statutes 1998, section 462A.206, 
        subdivision 4, is amended to read: 
           Subd. 4.  [DESIGNATED AREAS.] For the purposes of focusing 
        resources, a city or, a nonprofit, or a for-profit organization 
        located in a metropolitan statistical area must designate 
        neighborhoods within which the grants or loans may be used, and 
        a city or, nonprofit, or for-profit organization located outside 
        of a metropolitan statistical area must designate a geographic 
        area within which the grants or loans may be used. 
           Presented to the governor April 17, 2000 
           Signed by the governor April 20, 2000, 10:25 a.m.