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1988 Minnesota Session Laws

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                         Laws of Minnesota 1988 

                        CHAPTER 654-S.F.No. 1462 
           An act relating to housing; creating a low-income 
          housing trust fund account; providing for the uses of 
          the account; placing certain requirements on real 
          estate trust fund accounts; amending Minnesota 
          Statutes 1986, sections 82.24, by adding a 
          subdivision; and 82.34, subdivisions 6 and 15; 
          Minnesota Statutes 1987 Supplement, section 82.17, 
          subdivision 6; proposing coding for new law in 
          Minnesota Statutes, chapter 462A. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  Minnesota Statutes 1987 Supplement, section 
82.17, subdivision 6, is amended to read:  
    Subd. 6.  "Trust account" means, for purposes of this 
chapter, a savings account, negotiable order of withdrawal 
account, demand deposit or checking account maintained for the 
purpose of segregating trust funds from other funds.  A trust 
account shall not must be an interest bearing account except by 
agreement of the parties and subject to rules of the 
commissioner, paying the highest current passbook savings 
account rate of interest and shall must not allow the financial 
institution a right of set off against money owed it by the 
licensee. 
    Sec. 2.  Minnesota Statutes 1986, section 82.24, is amended 
by adding a subdivision to read: 
    Subd. 8.  [ACCRUED INTEREST.] (a) Each broker shall 
maintain a pooled interest-bearing trust account for deposit of 
client funds.  The interest accruing on the trust account, less 
reasonable transaction costs, must be paid to the state 
treasurer for deposit in the housing trust fund account created 
under section 5 unless otherwise specified pursuant to an 
expressed written agreement between the parties to a transaction.
    (b) For an account created under paragraph (a), each broker 
shall direct the financial institution to:  
    (1) pay the interest, less reasonable transaction costs, 
computed in accordance with the financial institution's standard 
accounting practice, at least quarterly, to the state treasurer; 
and 
    (2) send a statement to the state treasurer showing the 
name of the broker for whom the payment is made, the rate of 
interest applied, the amount of service charges deducted, and 
the account balance for the period in which the report is made. 
    The state treasurer shall credit the amount collected under 
this subdivision to the housing trust fund account established 
in section 5. 
    Sec. 3.  Minnesota Statutes 1986, section 82.34, 
subdivision 6, is amended to read:  
    Subd. 6.  The commissioner may expend money as appropriated 
for the following purposes: 
    (a) To promote the advancement of education and research in 
the field of real estate for the benefit of those licensed under 
this chapter; 
    (b) To underwrite educational seminars and other forms of 
educational projects for the benefit of real estate licensees; 
    (c) To establish a real estate chair or courses at 
Minnesota state institutions of higher learning for the purpose 
of making such courses available to licensees and the general 
public; 
    (d) To contract for a particular educational or research 
project in the field of real estate to further the purposes of 
this chapter;  
    (e) To pay the costs of the real estate advisory council 
established under section 82.30; and 
    (f) To pay any reasonable costs and disbursements, 
excluding attorney's fees, incurred in defending actions against 
the real estate education, research and recovery fund including 
the cost of mailing or publication of notice pursuant to 
subdivisions 12 and 14; and 
    (g) To provide information to the public on housing issues, 
including but not limited to, environmental safety and housing 
affordability. 
    Sec. 4.  Minnesota Statutes 1986, section 82.34, 
subdivision 15, is amended to read:  
    Subd. 15.  Any sums received by the commissioner pursuant 
to any provisions of this section shall be deposited in the 
state treasury, and credited to the real estate education, 
research and recovery fund, and said sums shall be allocated 
exclusively for the purposes provided in this section.  All 
moneys in the fund are appropriated annually to the commissioner 
for the purposes of this section. 
    All money credited to the fund under section 5 may only be 
used for purposes under subdivision 6, clause (g).  Beginning in 
1990, the commissioner must, on February 1 of each year, review 
the amount of money spent or allocated for uses under 
subdivision 6, clause (g), for the previous calendar year.  If 
the amount spent or allocated is less than the amount credited 
to the fund under section 5 during the same calendar year, the 
difference must be transferred from the fund to the housing 
trust fund account established in section 5. 
    Sec. 5.  [462A.201] [HOUSING TRUST FUND ACCOUNT.] 
    Subdivision 1.  [CREATION.] (a) The housing trust fund 
account is created as a separate account in the housing 
development fund. 
    (b) The housing trust fund account consists of: 
    (1) money appropriated and transferred from other state 
funds; 
    (2) interest accrued from real estate trust accounts as 
provided under section 2; 
    (3) gifts, grants, and donations received from the United 
States, private foundations, and other sources; and 
    (4) money made available to the agency for the purpose of 
the account from other sources. 
    Subd. 2.  [LOW-INCOME HOUSING.] The agency may, in 
consultation with the advisory committee, use money from the 
housing trust fund account to provide loans or grants for 
projects for the development, construction, acquisition, 
preservation, and rehabilitation of low-income rental and 
limited equity cooperative housing units.  At least 75 percent 
of the units must be rented to or cooperatively owned by persons 
and families whose income at the time the person or family 
originally occupied the unit was at or below 30 percent of the 
median family income for the metropolitan area as defined in 
section 473.121, subdivision 2.  In making the grants, the 
agency shall determine the terms and conditions of repayment and 
the appropriate security, if any, should repayment be required.  
To promote the geographic distribution of grants and loans, the 
agency may designate a portion of the grant or loan awards to be 
set aside for projects located in specified congressional 
districts or other geographical regions specified by the 
agency.  The agency may adopt emergency and permanent rules for 
awarding grants and loans under this subdivision.  The emergency 
rules are effective for 180 days or until the permanent rules 
are adopted, whichever occurs first. 
    Subd. 3.  [MATCHING FUNDS.] The agency may use money from 
the housing trust fund account to match federal, local, or 
private money to be used for projects authorized under 
subdivision 2. 
    Subd. 4.  [ADVISORY COMMITTEE.] The agency shall establish 
an eight member advisory committee under section 15.059 to 
advise or assist the agency in providing loans or grants from 
the housing trust fund account.  Members of the committee must 
represent the interests of realtors, lenders, nonprofit 
developers, apartment owners, low income persons, housing 
advocates, advocates for the homeless, and single or multifamily 
builders.  Members of the committee shall be reimbursed for 
expenses but shall not receive any other compensation for 
services on the committee.  Money in the housing trust fund 
account may be used for the expenses of the advisory committee 
and the agency related to the development and implementation of 
the program described in this section. 
    Subd. 5.  [TRANSFERS FOR EDUCATION.] On July 15 and January 
15 each year the agency shall transfer from the housing trust 
account to the real estate education, research, and recovery 
fund established in section 82.34, subdivision 1, five percent 
of the money credited to the housing trust fund account under 
section 2 during the preceding six months.  The amount necessary 
to make the transfers is appropriated from the housing trust 
account.  
    Subd. 6.  [REPORT.] The agency shall report to the 
legislature and the governor annually on the use of the housing 
trust fund account including the number of loans and grants 
made, the number and types of residential units assisted through 
the account, and the number of residential units assisted 
through the account that were rented to or cooperatively owned 
by persons or families at or below 30 percent of the median 
family income of the metropolitan area at the time of initial 
occupancy.  
    Sec. 6.  [EFFECTIVE DATE.] 
    Section 5 is effective the day following final enactment. 
    Approved April 26, 1988

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