01-14-1985 Council Packet - Laserfiche WebLink

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DI.Vi•.1. T,'-i VI . ;!.:A"1E1,ILS iTOI10SED 1,01.1CIES DS-1. INDUSTRIAL DEVELOPMENT BONDS (A) The League supports the continued use of industrial development bonds through application of the existing lDli allocation system with revisions which support the following principles: 1) A maximum of Minnesota ll)B allocation being retained by municipalities. 2) The maintenance of local discretion and flexibility in IDB decisions. 3) The minimization of state control of local IDB decisions. IDBs allow cities to undertake a diverse range of activities to prevent economic deterioration, to attract new businesses and jobs, to retain existing businesses and jobs, and to maintain and strengthen the local tax base. The league strongly recommends that the IDB allocation system maintain separate allocations for entitlement and non -entitlement users. The League emphasizes that the critical function of any allocation system is the efficient and full utilization of Minnesota's 11?b allocation. DS-2. HOUSING (B) The League of Minnesota Cities continues to encourage the use of tax-exempt financing for housing and supports the Minnesota Municipal Housing Revenue Bond Act, M.S. 462C, passed in 1479, as amended in 1982, 1983, and 1984. The League supports amendments to Chapter 462C necessary to further assist cities in using housing revenue bond programs both as a redevelopment tool and as a way to provide housing for low- and moderate -income households. The League supports an allocation formula which would provide 50 percent of the annual state ceiling to cities. The allocation to cities should be allocated 50 percent to a lotterv, and 50 percent should be allocated to cities of the first class. Cities of the first class are excluded from the lottery unless they forfeit to the lottery their direct allocation. The state should reserve $10 million of MHFA s allocation for programs for small cities, including pooling programs. MHFA program funds should be targeted to cities in a manner consistent with local plans and programs. The MHFA should continue to improve its procedure whereby representatives of a diverse gr-up of cities, chosen in consultation with the League, can participate in decision making as to MHFA priorities in targeting funds to cities. Cities recognize that incentives for the construction and rehabilitation of housing form a vital part of city redevelopment efforts and serve the housing needs of its citizens, especially those of low- and moderate-incooes. Because of the Federal Mortgage Subsidy Bond Tax Act of 1980, the ability of cities to conduct housing programs has been severely limited. Federal law placed an annual cap on the dollar volume of the single-family mortgage revenue bonds that may be used in Minnesota. -34-