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Committee hears proposal to add $10 million to Challenge Program to spur workforce and affordable housing
Summary
Senate File 982 requests a one-time $10 million increase to the Economic Development and Housing Challenge Program to support locally identified workforce housing projects statewide. Nonprofit developers and community land trusts told the committee the program acts as gap funding and leverages multiple sources; the bill was laid over for possible
Senator Bolden presented Senate File 982 to the Minnesota Senate Committee on Housing and Homelessness Prevention, seeking a one-time $10 million increase to the Economic Development and Housing Challenge Program, a gap-funding source intended to build housing affordable to local workforces.
“Since 2020 the challenge program has built or preserved more than 1,300 single family homes and more than 800 units of affordable rental housing,” Senator Bolden said, describing the program as flexible and locally focused. The committee heard testimony from nonprofit developers and community land trusts that said the Challenge Program helps projects with a mix of funding sources to reach financial feasibility.
Kelly Law, senior policy and field building advisor at the Minnesota Consortium of Community Developers, said the Challenge Program fills local gaps that federal, local and state funding do not, and that applications outstrip available funds. “By passing Senate File 9 8 2 and authorizing a one-time increase of $10,000,000 to Challenge we can address Minnesota’s housing shortfall,” Law said.
Mikia (Mikia) Griffin, executive director of Rondo Community Land Trust and chair of the Minnesota Community Land Trust Coalition, described how community land trusts use one-time subsidy dollars to create permanently affordable homeownership and commercial opportunities. She said Rondo has 50 units in the pipeline that could move forward with Challenge funds. Laura Helle of 3 Rivers Community Action testified that affordable projects rely on stacked financing—she listed nine funding sources used in one Rochester-area project—and urged efforts to reduce compliance burdens that increase development costs.
Committee members thanked sponsors and testifiers and asked few substantive questions; Senator Bolden and others emphasized the Challenge Program’s role as a “building block” in larger financing packages. The committee laid Senate File 982 over for possible consideration in a future omnibus bill; no formal committee vote was recorded at the hearing.
Ending: Senate File 982 was laid over for possible inclusion in a future omnibus; committee members acknowledged the Challenge Program’s role as gap funding for local workforce housing projects.
