March 24, 2026 · Housing and Homelessness Prevention · 10,424 words · 17 speakers · 127 segments
Minnesota Senate Committee on Housing and Homelessness Prevention to order. It is 1241 and we do have a quorum. Our first bill is going to be presented virtually by Senator Hochschild. Senator Hochschild, welcome to the Housing Committee. If you want to go ahead and present your bill whenever you're ready.
Thank you, Chair Port and members. Today I have for your consideration Senate File 4571, a bill regarding the Greater Minnesota Workforce Housing Development Program. The Greater Minnesota Housing Infrastructure Grants provide cities and tribal nations with funding for public infrastructure such as roads and utilities necessary to support housing developments. While this bill provides 15 million in Geobond Capital into the Greater Minnesota Housing Infrastructure Grant Program. A I'm in front of this committee today because it also makes a policy change to the program. This change would allow these funds to be used to support workforce housing in addition to the income restricted affordable housing that it currently covers. The first round of funding for this program was only available for income restricted affordable housing that runs contrary to the housing needs of many greater Minnesota communities that range from affordable housing to workforce housing and everything in between. So this bill seeks to expand the program to include workforce housing. Thank you Chair Port and committee members for your consideration to today I have three testifiers who can speak to the need for this bill.
Thank you very much, Senator Hochschild. All three testifiers are virtual, so we will move to those testifiers and if those folks can then just stay online in case there are questions at the end of this bill. First we'll go to Sarah Brun. Ms. Brun, if you would unmute yourself and introduce yourself for the record and present your testimony.
Thank you, Madam Chair and committee members. I appreciate the opportunity to testify in support of Senate file 4571. My name is Sarah Brun. I'm the city administrator for the city of Foley. Foley is a small city, approximately 2,700 people and located in central Minnesota. We're about 15 minutes east of St. Cloud on Highway 23. Our housing story really begins in 2023 when we completed a housing study with Benton County. This study followed a significant expansion and upgrade to our wastewater treatment facility. Housing for Foley is a top priority as we have not had a new housing subdivision in our community for over 20 years. The completed study that we did with Benton county actually identified the need for 340 housing units in Foley by 2035. So a small city of 2,700 people. 340 units is a lot for our small community. Our project really began to take shape when we were unable to spur housing development with some privately owned and marketed property that we had nearby. And that was really because of high land prices and the high cost of infrastructure. So we started focusing on some city owned property, about 23 acres that had existing trunk water and sewer lines in close proximity and only required short extensions to further develop. So after working through wetland delineations, we developed a concept of 33 single family lots. However, these single family lots, the infrastructure alone cost about $90,000 for each lot. And that includes the storm water, sewer, curb, gutter street and so forth. And that is just for the infrastructure. It excluded our wetland platting design, those type of preliminary costs, and it also excluded any land price as the city contributing is contributing the full property to the project. Fortunately, we plan to market these lots for considerably less than that. 90,000 for around 50,000. And that would not be possible without the contribution of city, county and federal funds as well as this critical Minnesota housing infrastructure funding that we were awarded. So we at the city of Foley do support additional funding to be allocated to this program. And also that program requirements allow for flexibility especially to establish owner occupied single family homes as well as these homes cannot always meet those strict income and workforce housing requirement income requirements.
Thank you. Thank you, Ms. Bruun. Next we'll go to Chad Adams. Mr. Adams, if you would unmute yourself and introduce yourself and present your testimony.
Thank you.
Chair Port and members of the committee. My name is Chad Adams and I'm the CEO of the Southwest Minnesota Housing Partnership, A non profit community development corporation serving 30 counties which includes over 200 communities across Southwest and south central Minnesota. Our organization produces single family and multifamily homes and has increasingly been providing housing services to cities. And our mission is to partner with community to develop places for people to call home. We Support Senate File 4571 that provides additional capital investment and more flexibility for small cities in greater Minnesota to of much needed workforce housing units. In addition to income restricted affordable housing on a feasible scale with fewer units than what most developers may require in larger population centers. Programs such as the Greater Minnesota Housing Infrastructure Program create opportunities for more collaboration and local investment. We are hearing from local jurisdictions, families and partners every day that housing is a top priority in every community we are engaged with throughout our 3020 region. At present, we're receiving significant demand for our organization to write grant applications for this program and other programs serving small communities. Instead of being the primary developer, we are enhancing our partnership to provide technical services with communities or other private sector builders to Create more homes. Our organization is already needed to make very difficult decisions on which community we can partner with for this program. There's limited funding available in the program. In fall of 2025, we only worked with three cities to apply for funds in the program, all of which were awarded Madison, Minnesota for $480,000, Redwood Falls for approximately $225,000 and Slayton for $25,000. Of the $8 million available for all of Greater Minnesota, 21 applications were awarded in the fall of 2025 and there are 48 applications requesting over $17.3 million. I must add that we are being very strategic in the amount of applications we will write or apply for due to the limited funds available and believe the demand to be much stronger than the actual application being submitted. At our partnership, we have a strong record reputation of partnering with community for nearly 35 years and finding creative way to leverage state funding. With city and county funding, private banks, along with federal grants, loans and private sector contributions. We plan to use a Greater Minnesota Housing Infrastructure Program for that very purpose to leverage other funding to build homes. This program alone does not provide the solution to the substantial housing needs throughout our region in Greater Minnesota, but it has already demonstrated the highly valuable tool that will secure private sector investment and other public partnerships to grow local economies. It has become a requirement for our organization to secure multiple sources source investments on our projects as for communities we serve and rather than just one local, state, federal or private source. I'm here today to ask for your continued partnership and investment in producing more homes in Greater Minnesota. Minnesota has been experiencing a significant housing shortage for far too many years due to in part decades of unpredictable state investment to leverage for projects in Greater Minnesota. We have already lost too many contractors and developers to build housing supply programs such as this infrastructure program provides the opportunity and more stability need for contractors and developers to enter the housing industry for the next generation and grow the number of homes needed throughout our vast region and state. Thank you to Senator Oud for authoring this bill and for the opportunity to testify today in support of the Greater Minnesota Housing Infrastructure Program.
Thank you for your testimony. And finally we have Jeff Brand. Mr. Brand, if you would introduce yourself for the record and present your testimony.
Good afternoon everyone. I'm Jeff Brand, Executive Director over at the Cook County HRA Housing Redevelopment Authority. Good afternoon from Grand Marais, Minnesota in my office here. Grand Marais is a city of about 1337 people and in Cook county itself we have a large need for workforce housing to meet the demands of the 1.3 to 1.6 million people that make their way all the way up to Grand Marais each year. It's a very tourism intensive economy up here, and we lack the available housing for our workforce. And so as an isolated county in Minnesota, here, it's really important that we have the available resources in order for our energy to keep going forward in the economy that we have. We did a housing study in 2022, and it showed we need about another 150 to 220 homes in Cook County. The only place in Cook county that allows us to have the infrastructure, the water, the sewer, the electric is in Grand Marais. The other communities you see along Highway 61 are actually township situations. And so they don't actually have the infrastructure like a regular community would. And so as we look to build housing, the natural option is for, of course, us to look in Grand Marais, but unfortunately, there isn't a lot of access to the funding that we need to make the housing affordable up here in an isolated county. It's a math problem. Not only do you have to deal with the cost of the materials and having them shipped up here, but also we have a large amount of bedrock that we have to blast. And if it's not bedrock, it's also wetlands. And so there's additional costs that make the math problems even more difficult to solve for to make affordable housing. And so with a bill like this, what this will do is allow us to have access to some of this to create more opportunities for us to build these blocks out. There is there is opportunity for us to build more housing, but the housing that we have now is kind of separated out throughout the community. And so extending utilities is costly. And in the opportunity that we have here for this bill Today, Senate File 4571. Thanks, Senator Ostrow, for offering this legislation will help us to make more affordable housing options here in Grand Marais and across Cook County. So I'm here to answer any question you might have, but I really do think this is an opportunity for us to do a more important job of creating more housing across our state, especially in greater Minnesota. Thank you.
Thank you. Members, questions, Senator Lucero.
Thank you, Madam Chair. And to Senator Hochschild, I did miss the opening part of your remarks, but could you just clarify or confirm, did you make reference that the first round of funding under the Greater Minnesota Housing Infrastructure Grant Program was for limited project or income limited projects?
Senator Hochschild.
Thank you, Chair Ford. Senator Lucero? That's correct. There was a limitation on income restricted affordable housing in the first round.
Senator Lucero.
Thank you, Madam Chair. And thank you, Senator Hochschild. Do you have familiarity then? Could you point to where this requirement is coming from? Was that a statutory requirement, or was that a rule that MHFA created, or where did that requirement come from?
Senator Hosschild.
Thank you, Chair Port. Senator Lucero, I do not know where the initial restriction came from. I do believe that Dariel is perhaps in the audience and she might be aware if she's able to come up to the podium.
Ms. Stannen or Mr. Kitzberger, If you could just introduce yourself for the record. Absolutely.
Happy to do that. Hi, members of the committee. Chair, my name is Dariel Danon and I am the executive director of Greater Minnesota Partnership. Thank you, Senator House Child for introducing this bill. So just to clarify for folks here, one of the things that we wanted to do in making this small policy change is just to make sure that the agency had clarity that non income restricted housing was an eligible use for this program. And so you'll see here that it references workforce housing. And so that's one of the things I think there was part of our legislative intent was to ensure that we could fund multiple kinds of housing, including, like I said, non income restricted housing.
Yeah. Senator Lucero.
Okay. Thank you, Madam Chair. So I guess the question may be for council, does that. Would a possible. I'm just looking at some notes here from. From others that are paying attention. Would a possible cross reference to statute 462A38 assist in the objective of the bill?
Ms. Painter.
Senator, could you please repeat the statute reference you just made?
Yeah. 462A 0.3 8.38.
Let me have a look. I'm sorry, I'm not sure that I have an answer. Could you describe more what you're looking for? Would you just repeat your concerns?
Sure.
If.
If. I understand. Thank you, Senator Lucer. So there's workforce home ownership and then there's low income. Or let me go back up here for income limited projects. And if I understand there's an. They're trying to bring clarity to the project that previously had income restriction, but it wasn't directly referenced. And so they're trying to bring some clarity by making it home workforce housing. So would there potentially this cross reference help in achieving that objective?
I wonder if perhaps someone from the agency. Mr. Kitzberger, put you on the spot here, but if you could just sort of describe how the decisions were made in the first allocation of funds. Madam Chair, apologize if you could introduce yourself for the record,
Madam Chair, members, for the record, I'm Dan Kitzberger. I'm the legislative director at Minnesota Housing. I'm just having some back and forth with my colleagues. One was to one, one piece of advice was to point folks to our frequently asked questions that came out as part of the RFP, particularly questions 27 and 28 that describe how we define workforce housing. So we use our affordable to the local workforce rental limits, which we publish in our multifamily guide. And so that allows for up to 150% of the applicable four bedroom rent. So 150% of what's affordable to the local workforce. Market rate housing which is specifically called out may fall into this category or may be priced higher. So, and then there's question 28, and whether we can consider ownership or rental housing. So, you know, I would just clarify for everybody. Market rate housing without income restrictions was an eligible use. We made awards for applications that included market rate housing.
Senator Lucero.
Thank you, Madam Chair. And, and I appreciate it. If I understand correctly, then the objective is workforce housing and attempt to achieve that. It used the definition for income restricted. Trying to make that association that an income restricted would help achieve workforce housing. And that's why the income restriction was included in the RFP, if I'm understanding correctly. Just seeking clarification on that, Mr. Kitzberger.
Madam Chair, Senator Lucero, I think I'm following. I guess at the very least what I attempted to clarify just now in reading from our frequently asked questions was that workforce housing was defined to potential applicants and we received applicants from or we received applications in accordance with that definition and then we subsequently funded applications that included projects with that definition.
Thank you, Madam Chair.
Senator Draheim.
Thank you, Chair. And thank you, Senator Hochschild for bringing this forward and bringing Jeff on board to speak on behalf of the bill. Good to see you, Jeff. I think clarification is always good. So thank you all that are working on it. I do get a lot of feedback on our different programs and we could do better on clarifying the uses. And I do think sometimes the agency takes a little too much liberty on interpreting our bills and maybe that's on us. But I do appreciate the concept of what we're trying to accomplish here. So thank you.
Other questions, Members, I wonder if Ms. Broun and Mr. Brand, can I ask, in the cities that you are working in, foley and then Mr. Brand, in the cities that you're working at expand, do you have minimum lot sizes and if so, do you know what they are? Ms. Brand or Ms. Brun? Sorry.
Yes, we do have minimum lot sizes. We actually reduced our minimum lot size from 10,000 to 8,000 for a single family home about a year, two years ago. That answers your question.
Mr. Brand, do you know in the areas that you are developing.
Yeah, thank you for the question. We did a similar change in grammar A to smaller lot size. And then also in the county itself, it depends on where you're looking. We still have multiple acres, depending on which. Which location. In particular, the challenge that we have is when we start looking outside of the community of Grand Marais, we start having to look at septics and wells and that sort of thing. Shared wells and shared septics and that sort of thing. But we still have a minimum of. It depends on which part of the zone you're looking at. It could be 10 acres, could be 5 acres, it could be 40 acres.
I think one of the questions that we have, you know, as we passed this bill a few years ago, there was $8 million in it, and we knew it was immediately oversubscribed. This is an important program to put money into. And so I. I think it is, you know, infrastructure funding is a critical piece of the puzzle of building more housing. But equally important, I think, is also, like, what are cities doing to ensure that those dollars go as far as is possible and, you know, what work are they doing to make sure that we can have the least amount of new infrastructure put in in order to fund a new subdivision? Mr. Kitsberger, can you answer for me? Does MHFA take into consideration responsible land use and growth strategies when scoring grant applications for this program?
Mr. Kitzberger, Madam Chair, members, I think our consideration was done through the pointing process. So, you know, whether we would receive proposals that included, you know, innovation, reuse, those kinds. I'm not exactly sure on the wording itself. I haven't looked at the application in a while, but it was a pointing consideration.
Thank you, members. Other questions on this bill, and I believe that this needs to go to capital investment. Senator Hochschild, do you have closing comments?
Thank you, Madam Chair and members. You're exactly right. You pinpointed what I was going to end with, Chairport, which is that this was an oversubscribed program and is clearly in high demand in our greater Minnesota cities. If you see one of the handouts, it lists many of the cities that did get funding, but even more that did not, that are in critical growth areas across greater Minnesota. And so really important that we continue to prioritize housing projects. And this will make it go a lot long, a lot further if we're able to apply it to workforce housing. So really appreciate the conversation and look forward to earning your support. Thank you.
Okay. Thank you very much for presenting your bill. Senator Hochschild. Members, seeing no further discussion, Senator Bolden moves that Senate File 4571 be recommended to pass and be referred to the Committee on Capital Investment. All in favor, say aye. Aye. Opposed? The motion prevails. Your bill is on the way to capital investment. Thank you, Senator Hochschild. Members, next up, we have Senator Clark, Senate File 4145. Senator Clark, go ahead with your bill of presentation whenever you're settled in.
Thank you, Chair. Thank you, Committee. By way of background, this bill was previously heard in Judiciary and Public Safety. It was amended and so this is the updated version here. So Senate File 4145, if enacted, would prohibit landlords from naming minor children as tenants or would prohibit naming minor children as defendants in an eviction action. Purpose of enacting this bill is to ensure that minor children, who generally do not have capacity to enter into binding contracts, are protected from the consequences of adult tenants not fulfilling their lease obligations. The picture I'll paint for you is what if you're an 18 year old adult trying to rent your first apartment, you're putting in rental applications for different properties, paying the application fees, and you keep getting denied for poor rental history. You're confused. How do I have poor rental history? I'm 18 years old. I've never rented before. How is this the case? Well, you come to find out, well, your parents were evicted when you were living with them and you were named as defendant in the eviction case, meaning that you have an eviction on your record. As a minor child, you'd have no reason to know about that eviction or understand the implications for that or your future. But now you can't afford to buy a home you've never as and you've never rented on your own. Yet you can't find a landlord to rent to you because your parents were evicted. And that eviction keeps showing up on your rental history. So you are suffering the consequences of your parents not complying with their lease, even though you shouldn't have been named under that eviction notice. We are trying to make sure that that situation becomes even less likely when a minor child is named in an eviction notice for no fault of their own, it follows them around and will lead in part to poor credit and rental history even before they've ever entered adulthood. Tenants who are renting for the first time on their own should be given every opportunity to be a successful renter, regardless of the choices they made or regardless of the choices made by their parents or adult tenants who they may have lived with while a minor. Senator Port.
Thank you very much, Mr. Clark. We have two testifiers. Mr. Smith and Mr. Dahl, if you would both come up. Mr. Smith, we'll start with you, so if you would introduce yourself for the record and present your testimony.
Thank you, Madam Chair, members of the committee, my name is Cecil Smith. I represent the Minnesota multi Housing Association. MHA has more than 2200 members who provide homes to over 600,000 Minnesotans in approximately 300,000 rental units across the state. Let me begin by saying clearly our organisation does not oppose the intent of this bill. Housing providers do not seek to file evictions against minors, and we agree children should not be the subject of eviction proceedings. In the rare circumstances where minors appear on eviction filings, it's almost always because they were listed on the lease as members of the household, not because they are responsible for the lease obligations. However, we do have a lingering concern with the current language of the bill. We're concerned about the penalty structure in paragraph B. The bill would allow damages for violations. Damages are reserved in statute for willful conduct, intentional wrongdoing and violations. In this situation, however, the issue would most often arise from a clerical or procedural mistake. Imposing damages in that context would be disproportionate to the conduct involved. Furthermore, corrective action at a later date would be by filing a motion which costs a hundred dollars and it's most often waived by the court. Given that the court should have removed the minor from the original filing, that seems to be a reasonable expectation. We believe the bill's core goal can be achieved while addressing our concerns. We have provided language to the bill author to that effect, and we appreciate the author's work on this issue. Thank you, Madam chair and members.
Mr. Dahl, if you would introduce yourself and present your testimony.
Good afternoon, Chair Port, Members of the committee, thank you for the opportunity to testify in support of Senate File 4145. And thank you to Senator Clark for championing this legislation. My name is Michael Dahl and I'm the Public Policy Director at Homeline. We provide free legal organizing, educational and advocacy services to tenants across Minnesota. As Senator Clark noted, young adults should not have their rental or credit history harmed by actions of their parents. But the consequences go beyond the record itself. There are financial impacts, quite often more than what you've just heard. First, a young adult must pay multiple application fees while searching for a new apartment. Cost will quickly add up. They will likely want to pursue an expungement to clear their rental history. That process can cost over $400 when you include district court and expungement filing fees. While these fees may get waived for someone with a very low income, it is not the case for everyone. Also, in response to Mr. Smith's testimony, whether this is due to negligence or administrative oversight, the errors originate with the landlord regardless of the intent or the resulting. The resulting harm to tenants begins there and they are the ones who bear the consequences. Again, young adult should have done nothing wrong. They should have a pathway to be made whole. Thank you again for the opportunity to testify in support of Senate file 4145.
Thank you members. Senator Draheim.
Thank you Chairport. Thank you, Senator Clark. It sounds like a common sense bill, but I know the devil's in the details. And you know, I have looked at a lot of leases, hundreds and hundreds and hundreds of leases over my many years and a lot of times they put in, you know, the question is what residents are on there. And I'm sure that I don't know how it works when you go to court, but I assume one of the items that you provide the judge is a copy of the lease and I don't know enough about the process and I know this is in our jurisdiction, it's judiciary which you said you went through but I am a little concerned about the damages, how it's drafted here. Do you have the language that Cecil Smith had recommended for that paragraph be that you could share with the committee?
Senator Clark, Chair Port and Senator Draheim and I trust that Mr. Smith will correct me if I get it wrong but in short he would seek to strike. Senator Dre I'm it'd be in line 1.14 perhaps we should ask Cecil to remind me to come back forward But I believe it's just striking everything the last sentence of on Mr. Paragraph B. Madam Chair.
Senator Draheim. Senator Clark is correct strike 1.14 and 1.15.
Thank you Chair.
Senator Draheim.
No, it's me. It's contagious. Same spam caller. I apologize members.
So
what is your thought? Obviously you haven't taken the advice of the multi Housing Association. Is there a happy medium between you and them on what we can do here? I just don't know the I have a Hard time supporting this. I love the idea. I think it is wrong to have the kids penalized for something that they had no control over. I just don't understand how the PAPE work is processed. And I hate to penalize someone when it might not be their fault. So how do we clarify that in the language in the bill? I guess would be my question. Senator Clark.
Senator Clark Chairport.
Senator Draheim. So the prior the initial drafting of it was treble damages up to $1,000. So we've come down, we have heard of treble. We moved 1,000. I moved 1,000 to 300. And specifically judiciary moved that where I'm also a member. And so it has had some modification in response, but obviously not all the way where Mr. Smith prefers. This is an eviction notice I have in my right hand. And the suggestion is that you list John or Jane Doe so that instead of naming a minor child, they that you are naming John and Jane does to ensure that that does cover all people in the eviction. But the process is that if the parent is being evicted or the caretaker is being evicted, the individual is being evicted as well.
Senator Draham thank you.
And I think that is a reasonable. I just don't know. So if the court provides something, some paperwork that has the original lease with the miner's name on it, is it the fault of the landlord or the housing provider and would they be penalized?
Senator Clark Chair Port.
Senator Draheim on an eviction notice that is drafted by the and if Mr. Dahl needs to correct me again, but it is drafted by the landlord. So they are the ones actively putting the name of the minor child on there incorrectly.
Senator Draham thank you.
So they don't see it isn't public record on the actual lease, the original document that they signed when they moved in.
Senator Clark Chair Ports.
Senator Drehain and in the they on there, is that the landlord or the judicial system?
Either way, I, you know, I mean, so if you have to provide documentation on why you have standing to evict, you know, a lot of times you got to bring in the documentation which has all the names on there. And sometimes parents put kids down. And so I just want to I wholeheartedly agree we shouldn't penalize kids. But I don't know enough of the process to rush this through where I don't know if we'll solve the problem with this bill. So I'm just a little without knowing the process of Mr. Dahl, maybe you can help me understand that we're getting it right on how the paperwork is processed. And then the credit reports are the ones that would give a bad rating because most housing providers I know use a service. So how are they getting the name of the minors? I'm sure they're scraping it from some database. And what feeds the database so manager, could I interject?
Senator Lucero, thank you.
If I could just put a slight change on or maybe clarification on what I think Senator Graham is asking. What if there's a clerical error on the part of the court and the minor child gets listed in the defendant's field for the action, the eviction action, Is that then going to be result in a penalty and the actual or consequential damages of 300 or whichever is greater? Because I'm so I'm familiar with the Hennepin county process. So if I'm going to file the paperwork for an administrator for an unlawful detainer, I am the one, as was just stated, I have to fill out the fields of the defendant, et cetera. I don't know how it works in other 86 counties. I don't know if they are feeding in the lease and extracting that information from the lease to populate the fields, et cetera. But in the course of that process of submitting the case to the courts, if there's a clerical error, does your language allow for enough wiggle room to not penalize or result in a fine or penalty to the landlord when the listed name of the minor might have not been the result of and action
by the landlord, Senator Clark or Mr. Dahl,
Chair Port, Senator Dreheim and Senator Lucero, usually on the, on the lease, sometimes the lease simply mentions the adults in the household, even if there are occupants other than that, young, young adults or children. But what often is the case is there are names, the actual names of the other occupants or the minors that are in the household. In the eviction action, what is commonly done, as was pointed out, is list Jane Doe and John Doe or occupant number three of the household. And those court documents list those individuals anonymously. And then when it talks about the parties, there's a plaintiff's list and the plaintiffs should only be the adults that are listed in that spot. And so there is the actual information on the lease usually. And then the I don't want to say redacted, but there's anonymous names for the youth in the system. And I'd also point out that in the court, in addition to filing for a motion for an expungement there are often court filing fees that have to be paid in advance or need to be paid as well. And those amounts add at least $300 to the cost of this, and they may be waived based on someone's income. But there aren't just people who are receiving public assistance who are having this happen to them. And so that's why the larger amount is something that has been pursued.
Senator Lucero, thank you, Manager.
I don't. I appreciate that, but I don't think that at all answers the question. Everything that was just said and addressed the question. So, on a lease, yes, there's the tenant, and then there's the occupants. The tenants are the ones that are in the contractual relationship of the. The leased unit. The occupants then are the minors that are authorized to actually inhabit that unit. In the course of filing the paperwork as part of the process for an unlawful detainer, then feeding a lease in and uploading that to the court's website is part of that process. As part of that process, there could be an extraction of the occupants of the lease that somehow then end up on the summons or become part of the defendants. So I think what's being asked here is, in the course of the process, there is margin for either a computer or human error to somehow have the occupants be listed as defendants. And in that scenario, landlords are going to be held accountable. Is there an escape clause to allow for wiggle room to not hold them accountable when the landlords did not deliberately, with malice intent, list an occupant or minor child as a defendant?
Can I just interrupt for one moment? The first line says a residential landlord shall not list a minor child as a defendant in an eviction application against a residential tenant. So that's the wiggle room. If they. If the landlord isn't the one that puts their name on, then the landlord is not held accountable for it. If they are the one that puts the name on, then they should be held accountable for. For it. So I think that is the wiggle room there.
Thank you, manager. I appreciate you pointing that out. So I think you're technically right. And so the question becomes, what if somebody's going to. I don't. What does the recovery process look like? How does a landlord. If the. If the. If an occupant or minor child does end up as the defendant, what is the process to prove that it was not them that did it? Right. To have to now save the landlord the time, the effort, the money, the expense of having to defend themselves against something that they may not have actually done. So I think that's kind of where the conversation's going.
It's the same as what the person who was harmed would have to go through, go to court. So we're saying that the kids should have to pay to go to court, but the landlord shouldn't have to pay to go to court to defend themselves.
Madam Chair, I think what I, what I. Is there a way? Because it says the, the penalty is the actual or consequential damages or $300, whichever is greater. And if there's an error that occurs in the processing of the paperwork, I'm. There's got to be a way to resolve this without going to court, because going to court costs everybody money. And is there a way to massage this language to the point that Mr. Smith brought up to avoid going to court to remedy the situation or to.
Yeah, I mean, I'm saying like, if a person has been harmed by this, if a child has been put on an eviction action and has been harmed by this, for 300 or likely many more dollars, they have to go to court in order to get recompense. So to require the landlord to do the same feels pretty fair to me. And I will also say this bill had a rather lengthy and deep discussion on the legal side of this in judiciary, and this is where they lowered the amount of money that landlords would be required to pay.
And if I could manager, if I could draw just one more thing to attention, it says the landlord shall not lie list. So the mere listing, they may not have even gone through the court process and come to a judgment. It's it just listing them as a defendant is all of a sudden now where the penalty could come in. They may not even have been rendered. The, the final action of what's going to happen with that unlawful detainer.
Right. Because those listed evictions often show up for a significant period of time.
Mr. Dahlia, chair port the issue is discovered when a minor is trying to rent for the first time. And so it's not being discovered until years. It could be a year later, it could be a couple years later, it could be much longer. We've had a nine year old listed on an eviction action at one point. And so this isn't a court process until the youth begins making a court process other than the eviction action, which the eviction action was filed at a much earlier date. But it's discovered and many of the costs related to addressing this are happening much later than when they rented the apartment their parents were put on an eviction action along with them.
Okay, I'm going to go to Senator Abelor, then Senator Pa, then Senator Draheim. Senator Abelor, go ahead.
Thanks.
Senator Clark, you've provoked quite a discussion here. It seems like this is something that should never happen. And I think most people don't intend for it to happen in the first place, but it's, you know, and I appreciate the arguments that have been offered, but. So this person didn't do anything wrong. All they did was now suddenly they're on some, you know, document and it's hurting them. And so we don't want to hurt the people that are. Meaning. Well, the reason you have a penalty for something is for people who don't do the right thing. I'll predict that none of the tenant, none of the people represented by Mr. Smith are going to do this ever. And so you have a penalty so that people know they should not do it. And if they do it, then there's a consequence. I imagine this penalty will be imposed probably just a fraction of 1% of the time and maybe never. But it's going to mean we're serious. And you've been trying to find something reasonable. But I just want to remind people this is not going to be something that happens every day at some housing complex in Anoka that has, you know, 200 units. They know better and so. But you. But that doesn't change what happened to that kid. Now if he's just the mat own, there's a duplex or somebody's kind of sloppy and then we're going to get around and they'll just not do it. They'll be careful. I think that I don't know what the right penalty is and you know, all the court costs and all that, but I, I just think you want to make sure they don't do it. So I think it's a good bill and I'm glad you're still working on the penalty. But just, I mean, there's, there's not training. You get to be a landlord without any training. You just show up, you have a MP place that you're duplex and now you're a landlord. And so they just need to be smart about it.
Thank you, Senator Path.
Thank you, Chair Ford. I do just want to say thank you, Senator Clark, for bringing this forward. It's. It's crazy that this is happening. And I know that we have quite a bit of discussion here about whether whether or not something is of the fault of the landlord, but I think Your language here is actually very clear, is very clear that a landlord shall not list a minor child in the complaint. If they do not name that child in the complaint, they're not going to be held accountable for that. If the court for some reason happens to put that on there, that's not on the landlord's fault and so therefore they would not have to face that consequence. But generally the court's going to go off of the complaint that's being filed by the landlord when they're bringing this eviction forward. And you have to name who your plaintiffs are and that's where they're naming these people. So they're only naming adults. They're not going to show up in that complaint. They are going to show up in the lease. All leases are turned in with those filings. But what's in the lease is not necessarily going to automatically be uploaded as a plaintiff. So that's not going to. That may happen. You know, one, you know, a one out of a thousand chances. But generally the plaintiffs, the plaintiffs are the ones that are going to be named and they're the ones who's going to be filed in court against. And so if landlords are not doing that, they're not going to have an issue with that. It's only when they're naming everybody, whether they're a tenant on the lease or if they're an occupant as a minor child. One thing we could do in just addressing some of these issues is I don't know if this is possible to explore, but to also ask that courts redact the names of all minors. And that could be something that we could require be done with these. But I think your language actually is already very clear and has the protections in place. I like it. And thank you for bringing this bill forward.
Thank you, Senator Pott. Senator Draheim,
thank you. Great discussion. I like the requiring the courts to redact. I think that that helps the housing providers. I would also suggest. And different enactment date for the penalty portion. So if you, if you're. I can do the math. I don't have the votes to do anything on that. But effective date August 1st for paragraph A and then for paragraph B maybe put that out a year so we can get some of the counties. So I imagine every county and Mr. Dowell maybe can speak to. This is different and Hennepin county probably being the most organized and the most volume, etc. But some of these rural counties that probably don't get too many eviction notices, period might have an antiquated system. So I think we need to give them time to catch up and not penalize someone in the middle of nowhere that they might have one eviction a year or two, et cetera. So that would be my suggestion. If you want, I can offer that amendment. Now I don't want to offer it if you're not going to consider it, but I think that would make sense. So keep Your enactment date August 1st of this year so we can start getting it right, but we don't penalize for a year. And then my other recommendation would be Senator Paz about having the court redact any minor. And I think that would make everybody happy. So I don't know what you think.
I will make one comment about the court piece. In several other pieces of legislation that we've passed over the festival past several years where we have told the courts to do something, they have laughed at us and said you don't have any control over us because we are an independent branch co. Equal branch of government. So it's certainly something we could discuss with the courts. But they generally find that bills language that we pass that compels them to do something that they do not have to follow it.
We could request.
We could request, yes. And I think that is a worthy conversation to have to make sure that in any other instances where forever, whatever reason, a child might be on a lease that their name is redacted. Seeing no other discussion. Thank you for the work that you've done on this. I know you've had a lot of.
Can he respond to my.
Oh, yeah.
Senator Clark, thank you.
Chair Port.
Thank you. Thank you. Senator Draheim. I think the piece that I most object to is that you said the ministry middle of nowhere, everywhere is the middle of somewhere. To your point. So in judiciary we do have sort of the ongoing. Here's the education we need to do to help you make sure folks understand. And I think that's a fair point. So I would entertain that. You know, paragraph A is August 1st and then paragraph B is January 1st of 2027.
Do you want to add that as an oral amendment?
Yeah, I'll take that. I mean I think it's better and I think that's the whole goal of committee process is to make the bill better. So I will take that. And you know, I hope that you will continue working with the multi housing association and maybe even the court system. Thank you everyone.
We'll give Ms. Painter a moment here to read that back to us.
Madam Chair and members. So the oral amendment would be page one, line 16. Delete this section and insert paragraph A and then line after line 1.1. Actually, sorry, after the period on page 1, line 17 would read, Paragraph B is effective January 1, 2027, and applies to eviction actions filed on or after that date.
Everyone okay with that reading? Does that. All right. All in favor of Senator Draheim's oral amendment, say aye. Opposed? The amendment is adopted. Senator Clark, any closing comments?
Thank you, Chair, and thank you, committee, for the robust discussion. As always, I know we all. We have the same goal, which is to keep people in homes. And that's part of what I love about this committee. So this is a way to make sure that we are helping young adults land on their feet and be able to secure housing more quickly and more fairly. So thank you.
And seeing no further Discussion, Senate file 4145 is laid over. Thank you. As amended. Finally, Senator Weber, thank you for your patience. Next on the agenda is Senate File 4749. Madam Chair, Senator Abel.
I'll move the bill and the amendment when the time is right.
Thank you. Welcome to the committee. Senator Weber, I believe you do have an amendment. Would you like to move that right away?
Yes, I would, and I'll explain it as I explain the bill then, Madam
Chair, that sounds great. Senator ABELER Moves the A3, is that correct, Mr. Senator Weber?
Correct.
Moves the A3. Authors, amendment. All in favor say aye. Aye. Opposed? The amendment is adopted. Go ahead to your bill as amended.
Thank you, Madam Chair and members. Senate File 4749, as amended, is brought to you today to analyze the impact of state and local costs on housing development and preservation. Basically what this bill does, it provides for a comprehensive study mandating a formal inventory and analysis of building permit fees, park dedication fees, and infrastructure impact fees fees. This creates a 16 member task force including legislators, state commissioners, or the representatives, local government, tribal government representatives, and housing experts across the state of Minnesota. The purpose of this is, of course, as I mentioned, to analyze these permit and fees and the costs that are going into the development of housing today. Today we all recognize that there is a shortage of housing across the state of Minnesota. And quite frankly, in the last couple of years, affordability has seemed to become the catch word of politicians and agencies across the country. And so why is action needed now? Basically, the soft cost of development taxes, fees and its actions can represent a significant part of a home's cost. And as we look at the development of residential lots and the development of new homes, it's time that maybe we take a look at possible legislative changes that could affect those type of costs in a downward fashion. And also analyze what the state of Minnesota has done in terms of forcing local governments to raise their fees in order to cover some of these areas. And some might say, well, why can't we just have the department of Revenue, the housing finance agency, develop those? Well, they have a good idea of what the costs are within the programs that they develop. But at this point, there really is no clearinghouse for the local development costs that come into play as this is being done. And I want to assure everyone that there is no goal here to try and take away money for local funding for parks and roads and that type of thing. Certainly street development and what have you is a long time development cost for any type of new housing development. And at this point we are also having this sunset in 2027. The goal is to come in, get it done, and you have information available for the legislature in the next session to act on. Sometimes we perhaps allow studies to go on far too long and this, it's a short time period, but I believe that at the end of the day this is something that can be done that will positively affect the cost of home and hopefully eventually even the supply of homes.
Thank you very much, Senator Weber. We have Grace Kelleher. If you would please introduce yourself for the record and present your testimony.
Thank you, Madam Chair and members, I appreciate the opportunity to come in front of you this afternoon and I want to let you know I'm strongly in support of Senate file 4749. My name is Grace Kelleher and I represent the Builders association of Minnesota. The Builders association of Minnesota is a statewide business trade association representing the home building industry. Our membership is made up of 700 of home builders, remodelers, developers, contractors, suppliers, realtors, financial institutions and other industry related members. BAM members join through one of our seven local associations scattered across across the state. I'm here today to testify in favor of Senate file 4749. And I want to thank Senator Weber for carrying this bill. In our professional work, we see firsthand the math of housing development is becoming increasingly difficult to solve. While we often discuss labor and material costs, the cumulative impact of state and local taxes, permit fees, infrastructure costs remain significant and often opaque, varying in the final price of a home. While we often discuss the affordability crisis, for many Minnesotans it has evolved into an attainment crisis. To effectively lower costs in the future, we must move along anecdotal evidence and start the conversation with irrefutable statewide data. Too often housing policy is debated using information from interested parties that can be skewed toward a specific point of view. This task force would provide a neutral fact based foundation for all future legislative action. Senate File 4749 is necessary to step toward the transparency and affordability for several reasons. Data driven solutions by establishing a formal inventory of all state and local fees, including park dedication and infrastructure impact fees, we can finally move from anecdotal evidence to data driven understanding of construction cost burden. Diverse Expertise this Task Force 16 member structure ensures voices from tribal governments, nonprofit developers and municipal finance experts are all at the table. Balanced recommendations this bill specifically tasks the group with finding ways to reduce costs while maintaining essential public services. We aren't looking to defund infrastructure. We are looking for a more efficient and equitable way to pay for it. With a report due by February 15, 2027, this task force provides a clear time bound roadmap for legislative action. If we are serious about solving the housing crisis, we must be serious about analyzing every dollar that goes into the cost of the front door. I urge you to vote yes. And once again, thank you, Madam Chair, members, and especially you, Senator weber.
Thank you, Ms. Kelleher. Members, questions, Senator Lucero?
Thank you Madam Chair. And thank you Senator Weber for bringing this. I think this is very important and I know we had a bill was it last year, two years ago to study the, the cost of or the building permit fee process. And so as I'm going through this, I see some opportunity to potentially maybe bring some more clarifying language onto the objectives of the group or maybe expand slightly. So let me just offer a few just, just right off the top of my head here, just some thoughts that came to mind as I'm looking at this. So like 2.9, it says it starts with the word analyze. On the next line, 2.11, it has the word evaluate. And so perhaps there could be some alignment on both being analyzed, both being evaluate, but that's a minor thing. But continuing line 2.9, analyze the cumulative effect of state and local taxes and fees on the final market price. How about also not just the final market price, but analyze on the cost, because the market price, the fair market value, you may not capture the full picture of what the building cost is. Right? So you have the cost of the new construction on the development, and based on where that development is, the market value could be 10% above the cost. It might be 12% above the cost, might be 15% above the cost. Right. But what we're actually, I think most interested in is the net result on the cost of construction, if that makes sense, not just the market value. The next thing I'm looking at is at line 2.11, evaluate how, whereas the previous line 2.9, it references both taxes and fees, in 2.11, you only reference taxes. So evaluate how housing related taxes and fees are allocated to state, county. Right. So I'm just throwing out there, you might also want to include fees in that. Further, it's not just these taxes and fees. Well, I guess maybe I would ask the question. When it comes to the buying and selling of real estate, we have all kinds of taxes. We have recording deed tax, we have different fees for the buying and selling, which will also go into the cost of homeownership. Right. Would such, would the. So it wouldn't be new construction, per se. Right. Because the buying and selling of existing deeds or transfer of deeds has a tax on them, several taxes. Would that be captured in this study?
In my opinion, it would not. Excuse me, Madam Chair. Madam Chair and Senator Lucero, in my opinion, it would not. I think that right now, when you start to talk about the fees of selling, now you're getting into the private market that, number one, has certain rules around it already, establishing the inability of brokers, for example, to have a set rate that they'd agreed to for a commission. Quite frankly, we all recognize that there are costs involved for our local units of government for recording the documentation and that type of thing within the courthouses. And so I think that those are elements that fall outside of the purview of this particular study.
Senator Lucero.
Thank you, Andrew. I was referring to the state deed tax. So when you. Not, not the commissions, none of that, none of those transaction costs, the tax the state charges for a deed transfer and how that contributes to the cost of homeownership and things like that. But. And that's fine. So the next thing is, perhaps this study could have some transparency in when it comes to the building permit fees and the park and other dedication fees. Park dedication, trails dedication, things like that. Where's the transparency? So a building permit is pulled and just a lump sum given. I'll just say the building permit fee there is. It's a black hole. It's a black box because the developer or the permit applicant gives this money to write a check for $10,000 for a permit fee, and there is zero transparency as to if that fee is actually going to cover the costs within the municipality that they incurred and there's zero transparency if there was anything left over, you know, of that $10,000 check the builder wrote for the application, if the city only incurred $4,000 of expenses, where did that balance of $6,000 go? Is it just being transferred to the general fund and the city is using it for other non housing development related purposes or should it be returned to the developer to help return reduce some of the cost of of the construction? Anyway, just some more transparency as another element as this language continues to be concerned, considered as it's moved. But I love where this is going. We need to analyze this because we need to bring some more streamlining and transparency into these costs and fees that are being incurred and simply get transferred on to the sales price of home development. Thank you, Madam Chair.
Thank you, Senator Lucero. Senator Weber, I find myself once again agreeing with Senator Lucero on this. I think we are really aligned that understanding the full picture is necessary for us to make real impactful changes and make sure that our resources at the state are going to the most helpful places in the process of creating new housing. I really appreciate this bill. I think like Senator Lucero, I think there are a few things that we should keep talking about. We. One for me is on 2.6 to 2.8 inventorying all of those current local taxes. I would be interested to understand what that process is, how many of those are public. Many of them are negotiated individually for each deal. And so like what is requiring the cities to share that information accurately and then how is it included sort of as in part of this report so we can fully understand the picture. And I agree with Senator Lucero that there are a few maybe language things that we could continue to talk about and work on. I know this, this bill has a couple of other committees to get to. So I don't want to hold it up here today, but would love to continue working with you on this. I think it's an important part of housing costs which are a problem all across Minnesota. Senator Lucero.
Thank you, Madam Chair. And just one more quick thought. So I had the privilege of serving on the homeowners association task force two interims ago, I guess it would have been. And much of that conversation was similar to having these different stakeholders as you have here. I think one difference with this task force is that there might be more effort needed because if you're going to go out there and collect information across the state, having to somebody or somebodies is actually going to have to go through the effort of looking information up in these municipalities, that's going to take time. So I don't know how that would work in such a task force, but I envision there will be some need for an actual staff or something to help with those efforts, because as I'm looking at the makeup of the stakeholders here, I'm not sure that these people are going to want to engage in that effort or just in their free time. So I don't know what that would look like, but just throwing that out there. So. Thank you, Madam Chair.
Thank you, Senator Weber.
Madam Chair. Senator Lucero. I think by having representatives of the local units of government on here, I think they have an access to their members whereby the request can be easily made for information. To be honest with you, there may even be some type of accumulation of that type of thing already, as you look upon the Building Inspector association and that type of thing. But I would agree with you that there may be some necessary costs involved in order to assemble that data.
Thank you very much. And Senator Lucero, I'd love to continue working with you, I think, especially on that transparency piece at the end. How is the. The money all being used and what's it used for? So we really can't see what impact this is having on housing costs in Minnesota. So I thank you very much for this bill. Seeing no further discussion, Senator Abeler moves that Senate File 4749, as amended, be recommended to pass and be referred to the Committee on State and Local Government. All in favor say aye. I opposed. The motion passes. And there being no other business today, this meeting is adjourned.
Thank you,
Sam.