Senate Taxes Committee to Consider Bill on Housing Improvement Areas

If your senator serves on the Senate Taxes Committee, please contact him or her before March 5 to share your support for SF 212.
(Published Mar 4, 2013)

The Senate Taxes Committee on March 5 will hear SF 212, a bill that would repeal the existing sunset for new housing improvement areas (HIAs) and special service districts (SSDs).

The bill was heard by the Senate State and Local Government Committee on Feb. 25. The House version of the bill was most recently heard by the House Housing Finance and Policy Committee on Feb. 27. It is awaiting a hearing in the House Taxes Committee.

Your help needed
If your city is represented by a senator who serves on the Senate Taxes Committee, please contact him or her before Tuesday, March 5 to share your support of SF 212.

Housing improvement areas are used by at least 10 cities, with many cities establishing more than one area within a city. The special service district tool is used by more than 15 cities all over the state. Both tools are useful for cities, retail businesses, and homeowners.

City outreach and advocacy on this issue has been crucial to its continued movement through the legislative process. Legislators have mentioned being contacted by their cities in hearings on this bill.

Legislative detail
SF 212 is authored by Sen. Melisa Franzen (DFL-Edina), Sen. Ann Rest (DFL-New Hope), Sen. Dave Senjem (R-Rochester), Sen. Bev Scalze (DFL-Little Canada), and Sen. Carla Nelson (R-Rochester).

The House companion bill, (HF 350), is authored by Rep. Steve Simon (DFL-St. Louis Park), Rep. Mike Nelson (DFL-Brooklyn Park), Rep. Mike Benson (R-Rochester), Rep. Barb Yarusso (DFL-Shoreview), Rep. Jason Isaacson (DFL-Shoreview), Rep. Connie Bernardy (DFL, Fridley) and Rep. Carolyn Laine (DFL-Columbia Heights).

Background
HIAs allow cities to assist property owners in condominiums and townhomes with financing housing improvements. Cities act as a conduit for the financing either by advancing funds and recovering the costs by charging property owners fees, or by issuing bonds and imposing fees or assessments to repay the bonds.

SSDs are a tool for cities to provide an increased level of service or infrastructure to their commercial or industrial areas. SSDs are established at the request of those who will pay for the increased level of service, typically business properties in downtown retail areas.

Under Minnesota Statutes, section 428A.11 to 428A.21, statewide city authority to create new HIAs and SSDs is scheduled to sunset on June 30, 2013. League policy FF-26, in the 2013 City Policies (pdf), supports making the authority for HIAs permanent. Both tools are used by cities throughout the state to improve neighborhood stability and increase services or infrastructure to a commercial or industrial area of the city. The League and Metro Cities are working together to ensure this local tool remains an option for cities.

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