Purpose of the Bill

This bill aims to amend the Minnesota Constitution to increase funding dedicated to housing initiatives through a sales tax increase. The objective is to support homeownership, prevent homelessness, and increase the availability of affordable rental housing for Minnesotans.

Main Provisions

• Sales Tax Increase: The bill proposes increasing the sales tax rate by three-eighths of one percent starting July 1, 2027, and lasting until June 30, 2052. The revenue from this increase will be dedicated to housing-related funds.
• Dedicated Funds: The raised funds will be allocated as follows:
  • 25% to the Homeownership Opportunity Fund: To assist in creating, purchasing, and rehabilitating homes for ownership.
  • 25% to the Community and Household Stability Fund: To provide emergency assistance, legal and educational services for those at risk of homelessness.
  • 50% to the Rental Opportunity Fund: For ongoing rental assistance, development, and other supportive services for renters.
• Creation of Councils: Establishes councils for each fund to oversee administration, plan strategic funding, and make recommendations for appropriations and policy changes.

Significant Changes

• Constitutional Amendment: The proposal requires amending the state constitution, which will be voted on by Minnesota residents in the 2026 general election.
• New Governance Structure: Introduction of fund-specific councils that comprise appointed members responsible for advising, planning, and supervising fund expenditures.
• Mandatory Audit: The legislative auditor is tasked with auditing the funds to ensure adherence to their designated purposes.

Administration and Oversight

• The bill outlines the composition of councils, emphasizing diversity and inclusion across racial, ethnic, and socioeconomic backgrounds.
• Nonvoting and voting members are to be appointed by various government leaders and organizations.

Additional Provisions

• The councils must develop strategic plans with clear goals and engage impacted communities.
• Reports and recommendations are required to be submitted regularly to the legislature, detailing expenditures and appropriations.

Relevant Terms

sales tax, homeownership opportunity, rental assistance, homelessness prevention, affordable housing, constitutional amendment, housing funds, housing stability, emergency assistance, Minnesota legislature, audit, housing council, strategic plan, voting member, racial disparities, economic diversity