The bill establishes a "locally controlled housing fund" as a separate account within the housing development fund, aimed at assisting eligible recipients such as cities, counties, and housing cooperatives in acquiring, rehabilitating, demolishing, or constructing housing. The fund will provide financing options including construction financing, permanent financing, and refinancing to increase the locally controlled housing stock. The bill outlines definitions for key terms, eligibility requirements for recipients, and stipulates that at least 30% of units in multifamily properties must be affordable to low-income households. Additionally, it mandates that applications for funding include a housing needs assessment.

To ensure effective administration, the bill requires the Housing Finance Agency to employ a director for the fund and mandates annual reports starting January 15, 2026, detailing funded projects and expenditures. An appropriation from the general fund is also included to support the creation and administration of the locally controlled housing fund. The bill emphasizes the importance of accessibility and affordability in housing projects financed through this fund, aiming to promote equitable housing opportunities across Minnesota.