The 2018 state legislative session has ended, and while it’s now quiet at the Capitol, housing advocates across Minnesota are celebrating a historic investment in the housing continuum.

Signed by Governor Dayton this week, the bonding bill includes $90 million for affordable housing and an additional $30 million for mental health crisis centers secured by Homes for All MN coalition partners.

With last year’s $77 million investment, over the 2017-2018 biennium, the Minnesota legislature has invested $197 million in bonds to preserve and build affordable housing and to provide homeownership opportunities, signaling a growing recognition among lawmakers that housing bonds are key to addressing the growing need for affordable housing across the state.

Photo: Homes for All MN advocates pose at the Capitol on the final day of the 2018 session. From left: Kari Johnson, MCCD; Fatima Moore, Minnesota Coalition for the Homeless; Libby Murphy, MHP; Erin Hanafin Berg, Preservation Alliance of MN; Elizabeth Glidden, MHP; Pam Johnson, TC Habitat

Our sincere thanks to housing advocates across the state who played an integral role in lifting up the need for investments in affordable housing and educating legislators on the impact of affordable housing on health, education, economic growth, and more. Read on for more updates from the Capitol!

Bonding breakdown

Signed by Governor Dayton on Wednesday, the bonding bill includes $90 million for affordable housing and an additional $30 million for mental health crisis centers secured by Homes for All MN coalition partners. The bill also authorizes manufactured housing and senior housing as new eligible uses for Housing Infrastructure Bonds.  

Here’s a breakdown:  

Housing Infrastructure Bonds (HIB):

• $50M – Non-restricted
• $30M – Restricted to Permanent Supportive Housing (for individuals with behavioral health needs)

General Obligation Bonds (GO):  

• $10M – Public housing investments
• $30M – Mental Health Crisis Centers (emergency shelter for individuals with behavioral health needs)
  • $28.1M –  Mental Health Crisis Centers Grant Program
  • $1.9M – Scott County Crisis Center

Tax Exempt Bond update

Policy language impacting the allocation of 4% credits to projects receiving tax exempt bonds (TEBs) was inserted into the bonding bill minutes before the close of session. The language essentially removes Minnesota Housing Finance Agency’s (MHFA) authority to set criteria for issuing 4% tax credits to projects that have received TEBs from a non-MHFA source beyond what federal law requires. MHP continues to review potential impacts of the policy language inserted into the bonding bill, since it does not include changes that reprioritize the issuance of TEBs. MHP is disappointed that the inserted policy language did not include the five consensus agreements agreed upon last fall by the TEB Steering Committee. These agreements were included in a separate bill vetoed by the Governor last week.  

Tax Credit Contribution Fund within reach next session

Supported by more than 50 organizations, the MN Housing Tax Credit for Contribution Fund garnered statewide, bipartisan support in the 2018 legislative session, building a broad coalition that included a variety of organizations – from nonprofits to chambers of commerce. While legislators did not include the Tax Credit for Contribution Fund in the omnibus tax bill, which included almost no new policy this session, MHP remains optimistic about the Tax Credit’s prospects for next session. Lawmakers have already committed to helping MHP advance the tax credit by working with us throughout the summer and fall. Help us continue to build support for this needed, proven tool by signing on to a support letter and sharing it with your networks!

A tough year for supplemental appropriations

With only a modest surplus, this was a tough year for supplemental appropriations. Governor Dayton vetoed the finance bill passed by the legislature earlier this month, which included no new investments in housing. The vetoed bill included the five consensus agreements of the Tax Exempt Bond steering committee, supported by MHP and Homes for All MN.   

What’s next?

In countdown to the 2019 session, MHP will continue to engage with lawmakers to advance our key policy initiatives including the MN Tax Credit Contribution Fund and a state match for contributions to Local Housing Trust Funds. MHP will also engage with candidates for public office and stakeholders statewide to grow support for a dedicated source of revenue for affordable housing in Minnesota.

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