Item Description:
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Increase the 2024 Local Affordable Housing Aid Fund budget by $10,000,000; transfer $10,000,000 to HED; supp app of $10,000,000 and 8.0 FTEs to 2024 HED budget
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Resolution:
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BE IT RESOLVED, that the 2024 Local Affordable Housing Aid Fund (Fund 24) revenue and interfund transfer out budget be increased by $10,000,000; that an interfund revenue transfer in the amount of $10,000,000 to the General Fund Housing and Economic Development department be authorized; that the 2024 General Fund Housing and Economic Development department interfund revenue transfer in and expenditure budget be increased by $10,000,000 and 8.0 FTEs for programming of the Local Affordable Housing Aid revenue; and that the Controller be authorized to transfer and disburse funds as directed.
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Background:
The 2023 Minnesota Legislature approved historic levels of new state funding for housing. The first is the new 0.25% metro area sales and use tax for housing (Minnesota Session Law 2023, Chapter 37, Article 5). The Metropolitan Council imposed this new tax, effective October 1, 2023. The Department of Revenue will administer the regional sales tax on behalf of the Metropolitan Council, as well as administer the distribution of sales tax funding to eligible entities as Local Affordable Housing Aid.
The second is the Statewide Affordable Housing Aid (Minnesota Session Law 2023, Chapter 64, Article 4, Section 24). The legislature approved an annual appropriation of $6.8 million under this program for counties, and an additional $8.5 million for counties in 2024 and 2025. Hennepin County is expected to receive $1.7 million a year from this state revenue source.
Together, these new dedicated funding sources for local affordable housing aid will generate an estimated $10 - $20 million per year for Hennepin County. While state agencies continue to develop required guidelines and regulations for the use of sales tax proceeds, county staff anticipates initial re...
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