Purpose of the Bill

The bill aims to improve the affordable housing sector in Minnesota by establishing new requirements and strategies for reporting, managing, and funding affordable housing initiatives. It seeks to ensure better regulatory practices and provides mechanisms for financial stability in this sector.

Main Provisions

• Annual Reports: The Minnesota Housing Finance Agency (MHFA) Commissioner must submit annual reports by February 15 detailing funding requests, awards, and the impact on housing units. Additionally, a financial stability report for the affordable housing industry is required by January 5.

• Local Affordable Housing Aid Meeting: An annual meeting is mandated between the MHFA, the Interagency Council to End Homelessness, and local governments to discuss issues related to affordable housing aid and regional needs.

• Commitment Term Restriction: The bill restricts the commissioner from imposing longer commitment periods than those required by Section 42 of the Internal Revenue Code for low-income tax credit commitments.

• Policy Framework Development: The MHFA Commissioner must develop a policy framework by January 5, 2026, focused on stabilizing regulated affordable rental housing and supporting distressed housing properties.

• Interagency Collaboration: The bill allows for regular meetings between public funders and housing stakeholders to seek solutions for preserving affordable properties.

• Funds Transfer: The bill includes provisions for transferring money from the general fund to the housing development fund, continuing in fiscal year 2028 and beyond.

• Appropriation: Funding is appropriated for fiscal year 2026 to support the development of the targeted stabilization policy framework for affordable rental housing.

Significant Changes

• The bill introduces annual reporting requirements for the MHFA Commissioner to provide more detailed insights into the state's affordable housing situations and financial health.

• It establishes a maximum compliance period aligned with federal tax credit guidelines for low-income housing, potentially altering existing extended commitments.

• The framework for targeted stabilization of affordable rental housing is a new initiative that may lead to future legislative proposals based on its findings and implementation.

Relevant Terms

affordable housing, Minnesota Housing Finance Agency, low-income tax credit, financial stability, housing aid, regulatory relief, rental housing, housing development fund, policy framework, housing insecurity, distressed properties.