Senate committee adopts amendments to bill clarifying Minnesota Housing's use of interest earnings; lays bill over
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Summary
Senate File 2434 (sponsored by Sen. Draheim) would clarify how interest earnings and appropriations tied to Minnesota Housing are treated; the committee adopted three amendments and laid the bill over for possible inclusion in the omnibus, with fiscal questions remaining.
Tuesday, Feb. 24 — The Senate Committee on Housing and Homelessness Prevention advanced procedural steps on Senate File 2434, a bill from Senator Draheim that seeks clearer lines between Minnesota Housing's loan‑portfolio activities and program appropriations by clarifying how interest earnings and appropriations are handled.
Senator Draheim described the bill as an effort to treat Minnesota Housing like other state agencies with clearer accounting for large appropriations and to codify capacity‑building grants in statute. He moved an author amendment (A‑3) to add an effective date; the committee adopted the amendment by voice vote.
The committee also adopted two additional amendments: A‑1, which limits certain provisions to appropriations made after July 1, 2027, and A‑2, which places capacity‑building grants into statute so they have a defined statutory home. Committee chair remarks and senator commentary characterized the A‑1 change as clarifying the bill would not retroactively alter earlier appropriations.
Fiscal staff summarized the bill's treatment of interest earnings from the housing development fund: beginning after 07/01/2027, the bill as amended would allow appropriations from the housing development fund to be invested and for aggregate earnings to be used to pay costs and expenses necessary and incidental to the development and operation of programs funded by those appropriations prior to periodic distributions to separate accounts. The fiscal analyst also noted recent interest earnings amounts: approximately $57 million in interest in fiscal 2025 (with about $54 million in 2024 and $13 million in 2023); those figures framed members' questions about whether the legislature should put more specific guidelines on use of earnings.
Senator Draheim said the bill will help provide clarity on when appropriations should be transferred into the housing development fund and how administrative retention might be allowed. The measure was laid over for possible inclusion in the omnibus; members said they preferred to wait for the state forecast before advancing fiscal items to the floor.
Recorded committee action: the A‑3, A‑1 and A‑2 amendments were each adopted by voice vote; the bill was laid over for possible inclusion in the omnibus. No roll‑call vote was recorded in committee.