Program would seek to provide more homeownership opportunity

“It still remains the ‘American Dream’, even with the Millennials I have spoken to,” Russ Willie, community development director for the City of St. Peter told the House Greater Minnesota Economic and Workforce Development Policy Committee on Tuesday.

Homeownership, long revered as a pivotal component of the “American Dream,” isn’t a reality for some in Minnesota any more due to either personal finance or lack of opportunities within the community they live. As a result legislators are considering ways to create more housing opportunities for working households, and close a homeownership gap throughout Minnesota.

Rep. Dan Fabian

HF3377, sponsored by Rep. Dan Fabian (R-Roseau), would create a program through the Minnesota Housing Finance Agency to fund grants that would be awarded to nonprofits and cooperatives. The grants would be used for land development and rehabilitation in an effort to further spur the creation of more single-family housing.

Approved by the committee, it now moves to the House Job Growth and Energy Affordability Policy and Finance Committee. A companion, SF3167, sponsored by Sen. Richard Cohen (DFL-St. Paul), awaits action by the Senate Health, Human Services and Housing Committee.

The program would use an application process that would award grants throughout both the Twin Cities metropolitan area and Greater Minnesota based on non-state contributions toward projects. Special consideration would be given to communities which have companies with displaced workers left living in temporary housing or renting.

“Workforce housing continues to be a big problem in Greater Minnesota, and quite frankly all of Minnesota. Employers are having trouble attracting employees, in some part, due to a shortage of housing,” Fabian said. According to Fabian, over the past four years Minnesota created seven times more rental units than single-family housing.

LISTEN Audio of Tuesday's meeting of the House Greater Minnesota Economic and Workforce Development Policy Committee

The program would work to supplement, not supplant, other state programs that promote homeownership.

“We’ve all seen a common need across the state to create homeownership opportunities at a much faster rate than we are doing,” said Jeff Washburne, executive director of City of Lakes and Land Trust.

Continued through 2025, after its inaugural fiscal year in 2017, the program would be self-funded through the appropriation of collected mortgage registry and deed in excess of the previous fiscal year. Essentially, the more effective the program is, the more it will have the opportunity to grow.

The MHFA would be required to submit an annual report to the Legislature regarding the program’s effectiveness.