2017 Minnesota Homeownership Initiative Legislation


First-Time Homebuyer Savings Account

Signed Into Law

The First-Time Homebuyer Savings Account was a leading proposal of the homeownership initiative. Importantly, this program is NOT a government handout. Instead, it encourages Minnesotans to save more of their own money by providing tax deductions and incentives to help achieve the dream of owning a home. That’s why we proposed the
First-Time Homebuyer Savings Account Act — a new idea to help people get into their first home.

The Law Provides:

  • Individuals can deposit money annually into a FDICinsured savings account. 
  • The account can be opened at any Minnesota bank or credit union.
  • Contributions to the account receive a state tax deduction on interest earned. Individuals can deposit up to $14,000 annually, while married joint filers can deposit up to $28,000 per year.
  • Parents or grandparents could set up an account AND receive a deduction from their own state taxes.
  • The plan applies to first-time homebuyers and those re-entering the housing market, if they have not owned a home within three years.

Effective Date: For taxable years beginning after Dec. 31, 2016

 Rep. Greg Davids (R-Preston)

Rep. Greg Davids

 Sen. Karin Housley (R-St. Mary’s Point)

Sen. Karin Housley
(R-St. Mary’s Point)

Remove Barriers to Developing Condos/Townhomes

Signed Into Law

A healthy housing market includes a wide variety of options to meet the needs present in the market.
Condos and townhomes represent a key segment of the marketplace and face serious challenges.

A key barrier to a healthy condo/townhome market was the state’s current construction defects
law, which created a disincentive to new condo/townhome development. 

The Law Provides:

  • Requires that a Homeowners Association mail each member of the association the nature of construction defect claim, the relief sought, and the HOA proposal to fund the litigation.
  • Requires the Homeowners Association to receive majority approval from its members to proceed with claim.
  • Prior to any construction defect claim, both parties must agree to mediation.
  • The association’s board of directors shall prepare, approve, and follow a written preventative maintenance plan and schedule.
  • Expands the definition of a construction defect claim.

Effective Date: Applies to common interest communities created on or after Aug. 1, 2017.

 Rep. Dennis Smith (R-Maple Grove)

Rep. Dennis Smith
(R-Maple Grove)

 Sen. Kari Dziedzic (DFL-Minneapolis)

Sen. Kari Dziedzic

Public Notice for Housing Moratorium

Signed Into Law

Minnesota law previously allowed a municipality to enact, without notice of a public hearing, a development moratorium that suspends a property owner’s right to use property for up to one year.

Several recent housing moratoria have impacted the market in cities like Golden Valley, Lake Elmo, and Minneapolis. MLS data revealed a direct impact on the housing market in cities where a moratorium was present, broadening the concerns of the policy beyond just the development community.

Now, property owners must be notified of any proposed housing moratorium to limit the use of their property, and provided an opportunity to raise objections or concerns at a public hearing.

The Law Provides:

  • Modifies the current statute to require a 10-day notice and a public hearing before enacting a moratorium that would regulate, restrict, or prohibit activities relating to housing.

Effective Date: Aug. 1, 2017

 Rep. Jim Nash (R-Waconia)

Rep. Jim Nash

 Sen. Dan Hall (R-Burnsville)

Sen. Dan Hall

Rulemaking Review Oversight

Passed Minnesota House Floor

The regulatory costs associated with new construction have surged over the past decade. We need responsible regulations to ensure safety and durability in new home construction, but the regulatory structure must meet these objectives at a price that families can afford. 

Key Features of the Bill Include:

  • Provides a legislative mechanism to review regulatory rule proposals to consider the cost impacts and balance affordability with the proposed regulation.
  • If a committee of either the House of Representatives or Senate with jurisdiction over the subject matter of the proposed rule votes to advise an agency that the rule should not be adopted as proposed, the agency may not adopt the rule unless the rule is approved by a law enacted after the vote of the committee.
  • The agency may proceed with other elements of the rule that are not related to the portions under review by the committee for cost-benefit analysis.

Positioned to Advance: In 2018

 Rep. Bob Vogel (R-Elko New Market)

Rep. Bob Vogel
(R-Elko New Market)

 Sen. Mary Kiffmeyer (R-Big Lake)

Sen. Mary Kiffmeyer
(R-Big Lake)

Twin Home Sprinkler Fix, Continuation of BATC v DLI

Signed Into Law

For the past four years, BATC has been fighting against mandated sprinklers in any single-family or twin home construction. Following our landmark victory in BATC v. DLI where the sprinkler mandate was struck down in one and two-family homes, the industry faced a new challenge – the court decision and code definition weren’t aligned.

The 2017 legislature addressed this technical issue with both the Senate and the House of Representatives voting
unanimously for HF 792. 

The law directs the Department of Labor and Industry to modify Minnesota’s Building Code to match the national building code. The legislation follows the Minnesota Court of Appeals’ directive in BATC v. DLI, where the mandate in one and two-family homes was struck down.

Housing First Minnesota will continue to seek a permanent statutory solution to the sprinkler policy issue. Absent establishing an affirmative position in statute, the sprinkler debate will begin again in the next code cycle, which starts in late 2017.

Effective Date: June 5, 2017

 Rep. Tama Theis (R-St. Cloud)

Rep. Tama Theis
(R-St. Cloud)

 Sen. Rich Draheim (R-Madison Lake)

Sen. Rich Draheim
(R-Madison Lake)