SF2041

SF2041 (Legislative Session 94 (2025-2026))

Increment tax financing districts eligible uses including transfers to local housing trust funds expansion provision

Related bill: HF1159

AI Generated Summary

This bill amends Minnesota’s tax increment financing (TIF) laws to expand the allowable uses of TIF revenues. Specifically, it permits the transfer of tax increments to local housing trust funds for use in affordable housing projects. The bill also sets requirements on how transferred funds must be used, including limiting the expenditures to specific housing-related activities. Additionally, it increases the percentage of TIF revenues that may be spent outside the district for qualifying housing projects and adds provisions for ensuring compliance with these financial limitations.

Key provisions include: - Allowing tax increments to be transferred to local housing trust funds established under Minnesota law. - Expanding the allowable uses of TIF expenditures outside the district for affordable housing initiatives. - Setting conditions for expenditures, such as supporting low-income housing projects and public improvements related to housing. - Adjusting spending limits and maintaining compliance with existing tax increment financing regulations.

The bill aims to encourage the development of affordable housing by providing greater flexibility in the use of TIF funds.

Bill text versions

Introduction PDF file

Actions

Date	Chamber	Where	Type	Name	Committee Name
March 02, 2025	Senate	Floor	Action	Introduction and first reading
March 02, 2025	Senate	Floor	Action	Referred to	Taxes

Citations

[
  {
    "analysis": {
      "added": [
        "A new allowance for increased expenditures outside the district for specific housing-related activities."
      ],
      "removed": [
        "N/A"
      ],
      "summary": "This provision governs tax increment financing plans and associated expenditures.",
      "modified": [
        "Adjusts percentage of revenue that can be expended outside of TIF districts."
      ]
    },
    "citation": "469.176"
  },
  {
    "analysis": {
      "added": [
        "Defines housing project as an activity within the district."
      ],
      "removed": [
        "N/A"
      ],
      "summary": "Mention of the housing project defined under section 469.174.",
      "modified": [
        "Clarifies that housing projects count as district activities."
      ]
    },
    "citation": "469.174"
  },
  {
    "analysis": {
      "added": [
        "Clarifies expenditures must assist housing that qualifies under federal code."
      ],
      "removed": [
        "N/A"
      ],
      "summary": "Federal Internal Revenue Code section for qualified low-income buildings.",
      "modified": [
        "Relates to conditions for housing expenditure qualifications."
      ]
    },
    "citation": "42"
  },
  {
    "analysis": {
      "added": [
        "Referenced in context of market value conditions for housing developments."
      ],
      "removed": [
        "N/A"
      ],
      "summary": "Defines metropolitan area in Minnesota statutes.",
      "modified": [
        "N/A"
      ]
    },
    "citation": "473.121"
  },
  {
    "analysis": {
      "added": [
        "Referenced for conditions on housing site qualifications."
      ],
      "removed": [
        "N/A"
      ],
      "summary": "Defines foreclosure as per Minnesota statutes.",
      "modified": [
        "Relates to conditions of foreclosed properties."
      ]
    },
    "citation": "325N.10"
  },
  {
    "analysis": {
      "added": [
        "Reference concerning conditions for owner-occupied housing assistance."
      ],
      "removed": [
        "N/A"
      ],
      "summary": "Citations regarding requirements for owner-occupied housing assistance.",
      "modified": [
        "N/A"
      ]
    },
    "citation": "469.1761"
  },
  {
    "analysis": {
      "added": [
        "Referenced for permissible transfers to housing trust funds."
      ],
      "removed": [
        "N/A"
      ],
      "summary": "Governance on housing trust fund establishment and utilization.",
      "modified": [
        "N/A"
      ]
    },
    "citation": "462C.16"
  },
  {
    "analysis": {
      "added": [
        "Clarification on returning revenue stipulations as remedies."
      ],
      "removed": [
        "N/A"
      ],
      "summary": "Remedies and enforcement related to tax increment financing.",
      "modified": [
        "Regulates adjustments to expenditure calculations against tax increments."
      ]
    },
    "citation": "469.1771"
  }
]