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Minnesota Legislature

Office of the Revisor of Statutes

Chapter 462A

Section 462A.21

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462A.21 HOUSING DEVELOPMENT FUND; ADVANCES, USE REPAYMENT.
    Subdivision 1. Purposes. The agency may use the moneys held in the housing development
fund for the purposes provided in this section.
    Subd. 2. Loans to nonprofit sponsors. It may make temporary loans to "nonprofit" sponsors
to defray development costs, as provided by section 462A.05, subdivision 5. Each such loan shall
be repaid in full by the borrower to the agency concurrent with the initial endorsement of such
borrower's eligible construction loan, unless the authority extends the period for the repayment of
the advances. In no event shall the time of repayment be extended later than the date of the final
endorsement of the eligible mortgage loan. If no permanent financing is obtained the loan shall be
repaid in accordance with such terms and conditions as the agency has prescribed by rule.
    Subd. 3. Planning grants. It may make planning grants to local communities, pursuant to
rules promulgated by the agency, in such amounts as the agency determines, not to exceed the net
costs, exclusive of any federal or other aid or assistance, as are incurred by the local community
in planning for land and building acquisition, improvements, renewal, relocation or conservation.
Such grants shall be limited to planning for specific sites upon which housing is, or is to be,
situated and sites designated for other uses that are reasonably related to such housing.
    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. For purposes of the authority to
administer the revolving loan fund under this subdivision, a nonprofit organization includes a
private nonprofit corporation that is formed under laws other than the laws of this state, provided
that the nonprofit corporation has an office located in this state. 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.
    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, prepurchase and postpurchase counseling
and associated administrative costs, 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.
    Subd. 4. Special fund. It may pay all costs and expenses of financing not paid out of a
special fund created by a resolution or indenture securing notes or bonds.
    Subd. 4a. Correction of housing defects. It may make rehabilitation grants and expenditures
for correction of residential housing defects as provided in section 462A.05, subdivisions 15 and
16
. In order to insure the preservation of the maximum number of housing units with the money
appropriated by the legislature, grants shall be recovered by the agency to the extent provided
in this section to be used for future grants. Grants made under the terms of this subdivision
shall contain a requirement that the grant be recovered by the agency in accordance with the
following schedule:
(1) if the property is sold, transferred, or otherwise conveyed within the first three years after
the date of a grant, the recipient shall repay the full amount of the grant;
(2) if the property is sold, transferred, or otherwise conveyed within the fourth year after the
date of a grant, the recipient shall repay 75 percent of the amount of the grant;
(3) if the property is sold, transferred, or otherwise conveyed within the fifth year after the
date of a grant, the recipient shall repay 50 percent of the amount of the grant;
(4) if the property is sold, transferred, or otherwise conveyed within the sixth year after the
date of a grant, the recipient shall repay 25 percent of the amount of the grant;
(5) if the property is sold, transferred, or otherwise conveyed within the seventh year after
the date of the grant, or thereafter, there is no repayment requirement; provided that no repayment
is required to the extent that the grants are made to improve the accessibility of residential
housing to a disabled occupant.
    Subd. 4b. Establishment of loan funds. It may establish loan funds and may make eligible
loans from them, at rates of interest and with security as the agency deems advisable, if each
loan is determined by the agency to be necessary to permit the occupant of residential housing
financed wholly or in part by the loan to meet the occupant's housing costs without expending an
unreasonable portion of the occupant's income on them. It may combine loan funds established
pursuant to legislative appropriations with loan funds established for the same or similar purposes
pursuant to the sale of its notes or bonds, and such combined funds may be deposited with a
trustee. Portions of these funds derived from appropriations or the sale of its notes or bonds
may be set aside as reserves against losses on loans to be made from the combined funds. Each
combined fund, including loan and investment principal and income received therefrom, shall be
administered, disbursed, and collected as provided in the appropriation act and the resolution or
indenture securing the bonds or notes.
    Subd. 4c. Loans to American Indians. It may establish a revolving loan fund and may
make eligible loans, pursuant to subdivision 4b, to American Indians as provided in section
462A.07, subdivision 14, and may pay the costs and expenses necessary and incidental to the
development and operation of such programs.
    Subd. 4d. Loans to urban American Indians. It may expend moneys for the purpose
of section 462A.07, subdivision 15, including the establishment of revolving loan funds for
programs for urban American Indians, and may pay the costs and expenses necessary and
incidental to the development and operation of the programs.
    Subd. 4e. Grants for residential multiunit housing. It may expend money for the purpose
of section 462A.05, subdivision 2a, and pay the costs and expenses necessary and incidental to
the development and operation of the grant program authorized therein.
    Subd. 4f. Accessibility grants. It may make grants for the purpose of section 462A.05,
subdivision 15a
and may pay the costs and expenses necessary and incidental to the development
and operation of the housing accessibility program.
    Subd. 4g. Energy conservation grants. It may make emergency energy conservation grants
as provided in section 462A.05, subdivision 15b and may pay the costs and expenses necessary
and incidental to the development of the emergency energy conservation grant program.
    Subd. 4h. Loans to veterans. It may create a revolving fund to be used to make loans for
the purpose of section 462A.05, subdivision 19, and pay the costs and expenses necessary and
incidental to the development and operation of the loan program authorized therein.
    Subd. 4i. Rehabilitation loans. It may establish a revolving loan fund for the purpose of
section 462A.05, subdivision 14a and may pay the costs and expenses necessary and incidental to
the development and operation of the loan program authorized therein.
    Subd. 4j. Insuring financial institution loans. It may expend money for the purposes of
section 462A.05, subdivision 23, and may pay the costs and expenses for the development and
operation of the program.
    Subd. 4k.[Repealed, 1997 c 200 art 4 s 23]
    Subd. 4l. Loan coinsurance. It may expend money for the purposes of section 462A.05,
subdivision 33
, and may pay the costs and expenses for the development and operation of the
program.
    Subd. 5. Other agency purposes. It may expend moneys in the fund, not otherwise
appropriated, for such other agency purposes as previously enumerated in this chapter as the
agency in its discretion shall determine and provide.
    Subd. 6. Limitation on certain grants. Notwithstanding the provisions of subdivision
5, the agency shall not expend money in the fund for the purpose of making rehabilitation
or accessibility grants except by specific appropriation by the legislature or by transfer of
unencumbered account balances as provided by section 462A.20, subdivision 3.
    Subd. 7. Energy efficiency loans. The agency may make loans to low and moderate
income persons who own existing residential housing for the purpose of improving the
efficient energy utilization of the housing. Permitted improvements shall include installation or
upgrading of ceiling, wall, floor and duct insulation, storm windows and doors, and caulking
and weatherstripping. The improvements shall not be inconsistent with the energy standards as
promulgated as part of the State Building Code; provided that the improvements need not bring
the housing into full compliance with the energy standards. Any loan for such purpose shall be
made only upon determination by the agency that such loan is not otherwise available, wholly or
in part, from private lenders upon equivalent terms and conditions. The agency may promulgate
rules as necessary to implement and make specific the provisions of this subdivision. The rules
shall be designed to permit the state, to the extent not inconsistent with this chapter, to seek
federal grants or loans for energy purposes.
    Subd. 8. Home ownership assistance fund. It may establish a home ownership assistance
fund, on terms and conditions it deems advisable, to assist persons and families of low and
moderate income in the purchase of affordable residential housing and may use the funds to
provide loans, additional security for eligible loans or to pay costs associated with or provide
additional security for bonds issued by the agency.
    Subd. 8a. Multifamily development assistance fund. It may establish a multifamily
development assistance fund, on terms and conditions it deems advisable, to be used in connection
with the financing of multifamily developments (a) to make loans, with or without interest,
pursuant to section 462A.05, subdivisions 2 and 3, or (b) to make payments into accounts of the
agency for the purpose of making payments required by a resolution for the issuance of its notes
or bonds, as permitted by section 462A.10, subdivision 4.
    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
80 percent of state median income, or to provide grants for the operating cost of public housing.
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, grants, and direct rental
subsidies under this subdivision may be made only with specific appropriations by the legislature.
The limitations on eligible mortgagors contained in section 462A.03, subdivision 13, do not apply
to loans for the rehabilitation of existing housing under this subdivision.
    Subd. 8c.[Repealed, 1995 c 224 s 126]
    Subd. 8d. Authorized leverage of money. The agency may leverage federal program money
with program money from the family rental housing assistance program established under
subdivision 8b and the rental housing assistance program established under subdivision 8c.
    Subd. 9. Innovative housing loans. It may make loans to encourage innovations in the
development or rehabilitation of single or multifamily residential housing pursuant to section
462A.05, subdivision 18.
    Subd. 9a. Revolving fund. It may create a revolving fund to be used to make loans to
encourage innovative multifamily housing pursuant to section 462A.05, subdivision 18a.
    Subd. 10. Certain appropriations available until expended. Notwithstanding the
repeal of section 462A.26 and the provisions of section 16A.28 or any other law relating to
lapse of an appropriation, the appropriations made to the agency by the legislature in 1976
and subsequent years are available until fully expended, and the allocations provided in the
appropriations remain in effect. Earnings from investments of any of the amounts appropriated
to the agency are appropriated to the agency to be used for the same purposes as the respective
original appropriations, after payment of the costs and expenses necessary and incidental to the
development and operation of the programs authorized under this chapter.
    Subd. 11.[Repealed, 1981 c 306 s 20]
    Subd. 12.[Repealed, 1997 c 200 art 4 s 23]
    Subd. 12a. Program money transfer. 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
.
    Subd. 13. Accessibility programs. It may spend money for the purposes of section 462A.05,
subdivisions 14, 14a, and 24
, and may pay the costs and expenses necessary and incidental to the
development and operation of the programs authorized in those subdivisions.
    Subd. 14.[Repealed, 1997 c 200 art 4 s 23]
    Subd. 15. Rural and urban homesteading program. It may make grants to eligible
organizations for the Minnesota rural and urban homesteading program under section 462A.057
and may pay the costs and expenses necessary and incidental to the grant program.
    Subd. 16. Residential lead paint and lead contaminated soil abatement. It may make
loans or grants for the purpose of the abatement of hazardous levels of lead paint in residential
buildings and lead contaminated soil under section 462A.05, subdivision 15c, and may pay the
costs and expenses necessary and incidental to the development and operation of the program.
    Subd. 17.[Repealed, 1Sp2001 c 4 art 5 s 10]
    Subd. 18. Family homeless prevention and assistance. The agency may spend money for
the purposes of section 462A.204 and may pay the costs and expenses necessary and incidental to
the development and operation of the program.
    Subd. 19.[Repealed, 2000 c 260 s 97]
    Subd. 20. Community development corporations. It may make grants to and enter into
contracts with community development corporations under section 116J.982, and may pay the
costs and expenses for the development and operation of the program.
    Subd. 21. Community rehabilitation program. The agency or its grantees may spend
money for the purposes of the community rehabilitation program authorized under section
462A.206 and may pay the costs and expenses necessary and incidental to the development and
operation of the program.
    Subd. 22. Contract for deed guarantee program. It may expend money for the purposes
of section 462A.2091 and may pay the costs and expenses necessary and incidental to the
development and operation of the program authorized by section 462A.2091.
    Subd. 23. Rental housing. The agency may spend money for the purposes of the rental
housing program authorized under section 462A.2097, and may pay the costs and expenses
necessary and incidental to the development and operation of the program.
    Subd. 24. Employer housing contributions; matching grant. It may spend money for the
purpose of the matching grant for employer contributions program under section 462A.2092, and
may pay costs and expenses necessary and incidental to the development and operation of the
program.
    Subd. 25. Consumer-owned housing revolving account. The agency may create a
consumer-owned housing revolving account: (1) to assist in paying delinquent mortgage
payments of persons participating in the federal National Mortgage Association pilot program for
homeownership of persons with disabilities; or (2) for other activities that support homeownership
activities for persons with disabilities.
    Subd. 26. Full cycle home ownership services. The agency may spend money for the
purposes of section 462A.209 and may pay the costs and expenses necessary and incidental to the
development and operation of the program.
    Subd. 27. Economic development and housing challenge program. The agency may spend
money for the purposes of section 462A.33 and may pay the costs and expenses necessary and
incidental to the development and operation of the program.
    Subd. 28. Family stabilization demonstration project. The agency may spend money for
the purposes of section 462A.205 and may pay costs and expenses necessary and incidental to
the development and operation of the project.
    Subd. 29. Disaster relief contingency fund. It may establish a disaster relief contingency
fund to provide loans or grants, on terms and conditions it deems advisable, to assist with the
rehabilitation or replacement of housing damaged as a result of a natural disaster in areas of the
state designated under presidential declarations of a major disaster. It may transfer to the disaster
relief contingency fund any repayments of grants or loans made from appropriations specifically
for assistance after natural disasters in areas of the state designated under a presidential declaration
of a major disaster.
    Subd. 30. Manufactured home park redevelopment. The agency may spend money for the
purposes of section 462A.2035 and may pay costs and expenses necessary and incidental to the
development and operation of the program.
    Subd. 31. Manufactured housing relocation trust fund. The agency may spend money
for the purposes of sections 327C.095, subdivisions 12 and 13; and 462A.35 and may pay the
costs and expenses necessary and incidental to the development and operation of the fund under
section 462A.35.
History: 1971 c 702 s 21; 1973 c 515 s 36-38; 1974 c 441 s 19-25; 1976 c 254 s 10-12;
1977 c 401 s 15-19; 1978 c 670 s 2; 1979 c 50 s 61; 1979 c 243 s 10,11; 1979 c 327 s 4,7-9; 1980
c 579 s 21; 1980 c 593 s 5,6; 1980 c 614 s 150; 1981 c 306 s 11,12; 1983 c 185 s 9,10; 1983 c
301 s 208,209; 1Sp1985 c 13 s 343,344; 1986 c 444; 1Sp1986 c 3 art 1 s 58; 1987 c 404 s 176;
1988 c 689 art 2 s 235; 1989 c 270 s 13-15; 1989 c 328 art 1 s 10-17; 1990 c 429 s 5-7; 1991
c 292 art 9 s 28-31; 1993 c 236 s 16,17; 1993 c 369 s 140-143; 1994 c 586 s 8; 1995 c 224 s
109-115; 1997 c 200 art 4 s 21; 1998 c 389 art 16 s 19; 1999 c 86 art 1 s 71; 1999 c 211 s
12; 1999 c 223 art 2 s 55; 1Sp2001 c 4 art 4 s 27-31; art 5 s 4; 2003 c 61 s 4; 2005 c 56 s 1;
2007 c 135 art 8 s 6; 2007 c 141 s 7