1.1                          A bill for an act 
  1.2             relating to taxation; tax-exempt bonds; modifying the 
  1.3             period allowed for use of single-family housing bond 
  1.4             allotments; amending Minnesota Statutes 1995 
  1.5             Supplement, section 474A.061, subdivision 2a. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 1995 Supplement, section 
  1.8   474A.061, subdivision 2a, is amended to read: 
  1.9      Subd. 2a.  [HOUSING POOL ALLOCATION.] (a) On the first 
  1.10  business day that falls on a Monday of the calendar year and the 
  1.11  first Monday in February, the commissioner shall allocate 
  1.12  available bonding authority in the housing pool to applications 
  1.13  received by the Monday of the previous week for residential 
  1.14  rental projects that are not restricted to persons who are 55 
  1.15  years of age or older and that meet the eligibility criteria 
  1.16  under section 474A.047.  If an issuer that receives an 
  1.17  allocation under this paragraph does not issue obligations equal 
  1.18  to all or a portion of the allocation received within 120 days 
  1.19  of the allocation or returns the allocation to the commissioner, 
  1.20  the amount of the allocation is canceled and returned for 
  1.21  reallocation through the housing pool. 
  1.22     (b) After February 1, and through February 15, the 
  1.23  Minnesota housing finance agency may accept applications from 
  1.24  cities for single-family housing programs which meet program 
  1.25  requirements as follows:  
  2.1      (1) the housing program must meet a locally identified 
  2.2   housing need and be economically viable; 
  2.3      (2) the adjusted income of home buyers may not exceed the 
  2.4   greater of the agency's income limits or 80 percent of the area 
  2.5   median income as published by the Department of Housing and 
  2.6   Urban Development; 
  2.7      (3) house price limits may not exceed: 
  2.8      (i) the greater of agency house price limits or the federal 
  2.9   price limits for housing up to a maximum of $95,000; or 
  2.10     (ii) for a new construction affordability initiative, the 
  2.11  greater of 115 percent of agency house price limits or 90 
  2.12  percent of the median purchase price in the city for which the 
  2.13  bonds are to be sold up to a maximum of $95,000. 
  2.14     Data establishing the median purchase price in the city 
  2.15  must be included in the application by a city requesting house 
  2.16  price limits higher than the housing finance agency's house 
  2.17  price limits; and 
  2.18     (4) an application deposit equal to one percent of the 
  2.19  requested allocation must be submitted with the city's signed 
  2.20  allocation agreement.  The agency shall submit the city's 
  2.21  application and application deposit to the commissioner when 
  2.22  requesting an allocation from the housing pool. 
  2.23     Applications by a consortium shall include the name of each 
  2.24  member of the consortium and the amount of allocation requested 
  2.25  by each member. 
  2.26     The Minnesota housing finance agency may accept 
  2.27  applications from June 15 through June 30 from cities for 
  2.28  single-family housing programs which meet program requirements 
  2.29  specified under clauses (1) to (4) if bonding authority is 
  2.30  available in the housing pool.  The agency must allot available 
  2.31  bonding authority.  For purposes of paragraphs (a) to (d), 
  2.32  "city" means a county or a consortium of local government units 
  2.33  that agree through a joint powers agreement to apply together 
  2.34  for single-family housing programs, and has the meaning given it 
  2.35  in section 462C.02, subdivision 6.  "Agency" means the Minnesota 
  2.36  housing finance agency.  
  3.1      (c) The total amount of allocation for mortgage bonds for 
  3.2   one city is limited to the lesser of:  (i) the amount requested, 
  3.3   or (ii) the product of the total amount available for mortgage 
  3.4   bonds from the housing pool, multiplied by the ratio of each 
  3.5   applicant's population as determined by the most recent estimate 
  3.6   of the city's population released by the state demographer's 
  3.7   office to the total of all the applicants' population, except 
  3.8   that each applicant shall be allocated a minimum of $100,000 
  3.9   regardless of the amount requested or the amount determined 
  3.10  under the formula in clause (ii).  If a city applying for an 
  3.11  allocation is located within a county that has also applied for 
  3.12  an allocation, the city's population will be deducted from the 
  3.13  county's population in calculating the amount of allocations 
  3.14  under this paragraph. 
  3.15     Upon determining the amount of each applicant's allocation, 
  3.16  the agency shall forward a list specifying the amounts allotted 
  3.17  to each application and application deposit checks to the 
  3.18  commissioner. 
  3.19     (d) The agency may issue bonds on behalf of participating 
  3.20  cities.  The agency shall request an allocation from the 
  3.21  commissioner for all applicants who choose to have the agency 
  3.22  issue bonds on their behalf and the commissioner shall allocate 
  3.23  the requested amount to the agency.  The agency may request an 
  3.24  allocation at any time after the first Monday in February and 
  3.25  through the last Monday in July, but may request an allocation 
  3.26  no later than the last Monday in July.  The commissioner shall 
  3.27  return any application deposit to a city that paid an 
  3.28  application deposit under paragraph (a), clause (4), but was not 
  3.29  part of the agreement forwarded to the commissioner under this 
  3.30  paragraph. 
  3.31     (e) A city may choose to issue bonds on its own behalf or 
  3.32  through a joint powers agreement or may use bonding authority 
  3.33  for mortgage credit certificates and may request an allocation 
  3.34  from the commissioner.  If the total amount requested by all 
  3.35  applicants exceeds the amount available in the pool, the city 
  3.36  may not receive a greater allocation than the amount it would 
  4.1   have received under the agreement forwarded by the Minnesota 
  4.2   housing finance agency to the commissioner.  No city may request 
  4.3   or receive an allocation from the commissioner until the list 
  4.4   under paragraph (c) has been forwarded to the commissioner.  On 
  4.5   and after the first Monday in February and through the last 
  4.6   Monday in July, no city may receive an allocation from the 
  4.7   housing pool which has not first applied to the Minnesota 
  4.8   housing finance agency.  The commissioner shall allocate the 
  4.9   requested amount to the city or cities subject to the 
  4.10  limitations under this paragraph.  
  4.11     If a city issues mortgage bonds from an allocation received 
  4.12  under paragraph (d), the issuer must provide for the recycling 
  4.13  of funds into new loans.  If the issuer is not able to provide 
  4.14  for recycling, the issuer must notify the commissioner in 
  4.15  writing of the reason that recycling was not possible and the 
  4.16  reason the issuer elected not to have the Minnesota housing 
  4.17  finance agency issue the bonds.  "Recycling" means the use of 
  4.18  money generated from the repayment and prepayment of loans for 
  4.19  further eligible loans or for the redemption of bonds and the 
  4.20  issuance of current refunding bonds. 
  4.21     (f) No city in an entitlement county may apply for or be 
  4.22  allocated authority to issue bonds or use mortgage credit 
  4.23  certificates from the housing pool. 
  4.24     (g) A city that does not use at least 50 percent of their 
  4.25  allotment ~~by the date applications are due for the first~~ 
  4.26  ~~allocation that is made from the housing pool for single-family~~ 
  4.27  ~~housing programs in the immediately succeeding calendar year~~ 
  4.28  within one year of the date of allocation may not apply to the 
  4.29  housing pool for a single-family mortgage bond or mortgage 
  4.30  credit certificate program allocation or receive an allotment 
  4.31  from the housing pool in the succeeding two calendar years.  
  4.32  Each local government unit in a consortium must meet the 
  4.33  requirements of this paragraph. 
  4.34     Sec. 2.  [EFFECTIVE DATE.] 
  4.35     Section 1 is retroactive to March 1, 1995, and applies to 
  4.36  allocations made on or after that date.