This bill proposes to expand the eligible uses of tax increment financing (TIF) increments in the cities of Minnetonka, Richfield, and St. Louis Park to include transfers to local housing trust funds. Specifically, it allows these cities to increase their expenditures outside the district by 15 percentage points, as authorized under Minnesota Statutes, section 469.1763. The bill outlines that the transferred increments must be allocated for housing purposes, with specific income requirements: funds for rental housing must benefit households at or below 80% of the area median income, while funds for homeownership must benefit households at or below 120% of the area median income.

Additionally, the bill stipulates that any increment transferred for use in housing trust funds will no longer be considered increment under section 469.174, subdivision 25, and will not be subject to the annual reporting requirements of section 469.175. This change aims to facilitate the use of TIF funds for affordable housing initiatives in the specified cities, thereby addressing local housing needs more effectively. The provisions of this bill will take effect the day following its final enactment.