This bill amends Minnesota Statutes 2024, section 469.1763, to expand the eligible uses of increment from tax increment financing (TIF) districts to include transfers to local housing trust funds. Specifically, it allows cities to allocate a portion of the tax increment to support housing projects that meet certain income requirements. The bill increases the allowable percentage of expenditures outside the district from ten to 15 percent for specific housing-related activities, including site acquisition, construction, and public improvements. Additionally, it introduces a new subdivision that outlines the requirements for transferring increment to a housing trust fund, specifying that funds must benefit households at or below 60 percent of area median income for rental housing and at or below 120 percent for homeownership.

Furthermore, the bill stipulates that any increment transferred for use under this new provision will no longer be considered increment for the purposes of annual reporting requirements. The effective date for these changes is set for the day following final enactment. Overall, this legislation aims to enhance the capacity of local governments to address housing needs by providing more flexible funding options through TIF districts.

Statutes affected:
Introduction: 469.1763