Senate committee hears bill to fund down‑payment assistance and cooperative conversions for manufactured‑home residents

St. Paul — Senator Kunish on Thursday asked the Senate Committee on Housing and Homelessness Prevention to back Senate File 26‑81, a bill that would provide $5 million in targeted down‑payment assistance and support cooperative conversions for manufactured‑home park residents.

"Senate file 26 81 addresses a pressing need for Minnesota's manufactured home residents by providing essential funding for down payment assistance and cooperative ownership," Kunish told the committee, saying the proposal aims to preserve affordable housing and expand resident ownership.

The bill’s supporters told the panel the money would be used as a revolving loan fund to help resident groups or nonprofits enable households to buy their lots or convert parks into resident‑owned communities. Emily Stewart, associate director of the North Country Cooperative Foundation, said Minnesota has a substantial stock of manufactured housing but that residents often do not own the land under their homes and therefore lack access to conventional mortgages.

"Without additional resources, we might not be able to secure resident ownership for all those that want it," Stewart said. She told the committee the foundation has deployed and committed $4 million of a prior state investment to preserve 254 home sites in Alexandria, Breckenridge, Zumbrota and Fairmont, and that a supplemental $5 million would support a pipeline of transactions.

Jason Peterson, executive director of NeighborWorks Home Partners, told the committee his organization — a certified community development financial institution — has the capacity to originate down‑payment assistance loans across the state and is partnering with North Country to develop a new first‑mortgage product for manufactured homes.

Testimony and committee discussion included several details about program design. Witnesses said typical first‑mortgage sizes tied to the cooperative conversions are in the $130,000–$140,000 range, and they cited an average down‑payment assistance amount of about $20,000–$25,000 for households under 60% of area median income. Stewart described program loans averaging about 4% interest and cited a prior example where deferred‑interest capital reduced projected lot‑rent increases at purchase from $135 to $75 per month, a difference she said would save an affected household roughly $720 per year.

Supporters told the panel the proposed funding would help prevent displacement when parks are sold and would save state dollars in the long run by reducing demand for emergency housing services. Committee members asked about program mechanics and eligibility; Peterson and Stewart described an existing pipeline of projects and said they could deploy additional resources if the fund were replenished.

No committee vote was taken on the bill. Chair Port recorded that "Senate file 26 81 is laid over for possible inclusion in the omnibus." The committee will revisit the item if it is placed on the omnibus or if additional hearings are scheduled.

Why it matters: Manufactured housing is a major source of non‑subsidized affordable homeownership in Minnesota. Proponents say targeted down‑payment assistance and support for cooperative conversion are tools to preserve long‑term affordability and prevent displacement when parks change hands.

What’s next: The bill was laid over for possible inclusion in the omnibus process; proponents said they have a pipeline of transactions and urged prompt action to preserve affordability.