Minnesota Passes Bonding Bill that Prominently Features Affordable Housing

Legislators in Minnesota endured a tumultuous year in 2020, with partisan gridlock, the COVID-19 pandemic, and emergent issues of police reform, all of which challenged efforts to move forward with other important legislation. Bonding legislation finally broke through the logjam on October 14 during the legislature’s fifth special session in 2020. The final bonding bill constitutes a $1.87 billion package that includes $116 million overall for bonds for housing. The bill failed in earlier periods of the legislative process but finally succeeded with a 100-34 vote in the House of Representatives and a 64-3 vote in the Senate. The bill required a super-majority in each legislative body, and significant bi-partisan support was achieved through the advocacy of the Homes for All campaign, including NLIHC state partner organizations Minnesota Housing Partnership and Minnesota Coalition for the Homeless in lead roles.

The bill will be a boost to infrastructure projects throughout the state. It includes $100 million in housing infrastructure bonds (HIB) and an additional $16 million in general obligation (GO) bonds for housing. Minnesota Housing Partnership shares that the HIBs will produce an estimated 500 to 1,000 new affordable homes. The GO bonds, meanwhile, will be used for maintenance of existing public housing. HIBs can be used for various purposes, such as establishing new supportive housing, preserving affordability, and supporting land trusts or land banks. This year, legislators decided to expand eligible uses of HIBs to include single-family housing production, and unfortunately, did not accept the Homes for All coalition suggestions to deeply income target affordability of housing supported by HIB funding.

“We have many more shovel ready projects than the state has funding to support, so these housing bonds ensure that we are able to continue to build more desperately needed affordable housing across Minnesota and will serve as an economic stimulus that our state needs to put people back to work,” said Anne Mavity, executive director at MHP.

Advocates are pleased that the bill for the first time includes several “Equity Appropriations” to ensure funding from the bonding bill serves communities left out in the past. Specific provisions require local governments to ensure the state’s workforce participation and equal-pay protections.

For more information, contact Libby Murphy, deputy policy director at Minnesota Housing Partnership, at: [email protected]