HF2740

Purpose of the Bill

The purpose of this bill is to improve and stabilize the affordable housing industry in Minnesota. It aims to ensure that housing remains accessible to low-income residents and that the overall financial health of the affordable housing sector is monitored and strengthened.

Main Provisions

• Annual Reporting: The Minnesota Housing Finance Agency (MHFA) commissioner must provide an annual report by February 15 detailing the number of applications for funding, the funding requested and awarded, and the housing units impacted.
• Financial Stability Report: By January 5 each year, the commissioner must report on the financial stability of the affordable housing industry, focusing on operating expenses, revenue, and rent collections across different state regions.
• Local Affordable Housing Aid Meeting: An annual meeting is required between the MHFA commissioner, the Interagency Council to End Homelessness, and local governments to discuss the impact of housing aid, regional needs, and strategies to combat homelessness and housing insecurity.
• Commitment Restrictions: The commissioner cannot require commitment terms longer than the compliance period specified in Section 42 of the Internal Revenue Code.
• Stabilization Policy Framework: The MHFA commissioner must create a policy framework focusing on the stabilization and recapitalization of affordable rental housing, identifying strategies, tools, and funding mechanisms.
• Interagency Stabilization Group Meetings: Regular meetings may be organized to find funding solutions for preserving affordable properties.
• Fund Transfers and Appropriations: Transfers from the general fund to the housing development fund are planned for fiscal years 2026 and 2027, with an appropriation to develop the stabilization policy framework in 2026.

Significant Changes to Existing Law

• Formalizes reporting requirements and establishes new expectations for financial reporting on affordable housing.
• Limits the length of tax credit compliance periods to align with federal regulations.
• Introduces new frameworks and collaborative efforts to address housing stabilization and homelessness.

Relevant Terms

affordable housing, low-income tax credit, Minnesota Housing Finance Agency, compliance period, regulatory relief, housing development fund, stabilization policy, financial stability, housing insecurity, homelessness