HOUSE BILL No. 4682


     May 1, 2001, Introduced by Reps. Birkholz, Jansen, Kooiman, Hart, Van Woerkom, Middaugh, Mead, Richardville, Jelinek,
Lockwood, Schauer, Kolb, Shackleton, Bovin, Vander Veen, Voorhees, Godchaux, Murphy, Cameron Brown and Kuipers and
referred to the Committee on Local Government and Urban Policy.


        A bill to establish the Michigan affordable housing fund in

   the department of treasury; to provide for the administration of

   the fund; to provide for the deposit of certain money in that

   fund; to provide for the distribution of the money in that fund

   and to limit the use of the money in that fund; and to prescribe

   the powers and duties of certain state officials.

               THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 1
           Sec. 1.  This act shall be known and may be cited as the

 2
      "Michigan affordable housing fund act".

 3
           Sec. 2.  As used in this act:

 4
           (a) "Authority" means the Michigan state housing development

 5
      authority created in section 21 of the state housing development

 6
      authority act of 1966, 1966 PA 346, MCL 125.1421.

 7
           (b) "Department" means the department of treasury.




   00310'01                                                 LTB
                                              2

 1
           (c) "Eligible applicant" means that term as defined in

 2
      section 58 of the Michigan state housing development authority

 3
      act of 1966, 1966 PA 346, MCL 125.1458.

 4
           (d) "Michigan affordable housing fund" or "fund" means the

 5
      Michigan affordable housing fund created in section 3.

 6
           Sec. 3.  (1) The Michigan affordable housing fund is created

 7
      as a separate fund in the department.

 8
           (2) The fund shall be administered by the authority, and

 9
      money in the fund shall be expended only as provided in this

10
      act.

11
           (3) The department shall credit to the fund all amounts

12
      appropriated for the purposes under this act and any money

13
      received as contributions for purposes under this act.

14
           (4) The state treasurer shall invest the money in the fund

15
      and credit the earnings from the investments to the fund.

16
           (5) Money appropriated or money received as a contribution

17
      to the fund shall be available for disbursement upon

18
      appropriation.

19
           Sec. 4.  Notwithstanding any other allocation or disburse-

20
      ment, an amount equal to the cumulative contribution made to the

21
      fund, less any amount appropriated to the department for the pur-

22
      pose of implementing this act, shall be deposited in the fund and

23
      shall be appropriated annually solely for the purpose of the

24
      fund.

25
           Sec. 5.  (1) Money in the fund shall be allocated to organi-

26
      zations exempt from taxation under section 501(c)(3) or (4) of

27
      the internal revenue code of 1986 for housing projects if the



   00310'01                                    3

 1
      organization has conducted a market study or review to ensure

 2
      that there is a demand and need for the housing project

 3
      proposed.

 4
           (2) Housing developed with money from the fund shall be con-

 5
      sistent in nature with housing already provided in the area to be

 6
      developed.

 7
           (3) The authority shall encourage housing projects that are

 8
      part of a planned community revitalization strategy.

 9
           Sec. 6.  (1) Money from the fund shall be used to provide

10
      grants, mortgage loans, and other loans including, but not

11
      limited to, construction loans, bridge loans, and predevelopment

12
      loans to provide housing for low income, very low income, and

13
      extremely low income households.

14
           (2) Money from the fund may be used to provide single-family

15
      or multifamily housing.

16
           (3) A portion of the allocation each year, as determined by

17
      the authority, shall be used to provide housing for all of the

18
      following:

19
           (a) Homeless persons.

20
           (b) Persons with physical and mental disabilities.

21
           (c) Persons living in distressed or rural areas.

22
           (4) Money in the fund may be used for all of the following:

23
           (a) Acquisition of land and buildings.

24
           (b) New construction or rehabilitation of existing

25
      buildings.

26
           (c) Predevelopment and development costs.





   00310'01
                                   4

 1
           (d) Costs to preserve existing housing units.

 2
           (e) Infrastructure and community facilities that directly

 3
      support housing development.

 4
           (f) Insurance premiums.

 5
           (g) Operating and replacement reserves.

 6
           (h) Down payment and security deposit assistance.

 7
           (i) Supportive services.

 8
           Sec. 7.  (1) The authority shall develop annual priorities

 9
      based on the allowable purposes under section 6 and allocate the

10
      money in the fund based upon those priorities.

11
           (2) Each year, prior to the allocation of money from the

12
      fund, the authority shall hold public hearings in at least 3 sep-

13
      arate locations throughout this state on the priorities and pro-

14
      posed allocations for the upcoming year.

15
           Sec. 8.  (1) The authority shall develop an allocation plan

16
      each year based on the annual priorities developed under

17
      section 7 that includes, but is not limited to, how the authority

18
      will identify, select, and make financing available to applicants

19
      to develop fundable projects.  The plan shall include how the

20
      authority will allocate money to provide technical assistance to

21
      eligible applicants.

22
           (2) The allocation plan shall include all of the following:

23
           (a) A list of the organizations and types of organizations

24
      eligible to receive money from the fund.

25
           (b) Any preference for identified special population

26
      groups.





   00310'01
                                   5

 1
           (c) Any geographic targeting in designated revitalization

 2
      areas including, but not limited to, the authority's neighborhood

 3
      preservation program areas, renaissance zones, federally desig-

 4
      nated empowerment and enterprise zones, and community or homeow-

 5
      nership zones.

 6
           (d) The allocation funding formula as prescribed in subsec-

 7
      tion (3).

 8
           (3) The authority shall determine a formula for allocating

 9
      money throughout the state using all of the following factors:

10
           (a) The number of persons in poverty in a geographic area.

11
           (b) The level of housing distress in a geographic area.

12
           (c) Any other factor that supports the need for affordable

13
      housing as determined by the authority and included in the allo-

14
      cation plan.

15
           Sec. 9.  Any balance remaining in the fund at the end of any

16
      fiscal year shall not revert to the general fund but shall remain

17
      in the fund and continue to be available for the purposes autho-

18
      rized in this act.

19
           Enacting section 1.  This act does not take effect unless

20
      Senate Bill No. _____ or House Bill No. 4684  (request

21
      no. 00310'01 a) of the 91st Legislature is enacted into law.















   00310'01          Final page.                            LTB