Housing Bills at the Capitol

After months of working through a remote legislative session by Zoom, there are a number of bills moving through the process that that would impact the housing industry. Several of these have advanced through the committee process and await further discussion in floor debates or in the larger omnibus finance bills that will be developed and voted upon later in the spring.

Five-Year Payback for Energy Code Provision 

Several legislators have prioritized protecting Minnesota’s top ranking in new home energy efficiency, while also raising affordability as a top issue. This legislation mandates that the costs of any new provisions added to future updates to the Minnesota energy code must have no longer than a five-year payback following completion of a new home project. This bill drew opposition from more than a dozen special interest groups, but it advanced following the committee discussion.

Single-family homes exempted from window fall prevention

Several years ago during a building code update process, single-family homes were mandated to include window fall protection devices in certain settings. This bill moves to strike that provision in many locations throughout one- and two-family dwellings and townhomes, solving an egress issue and saving homeowners hundreds of dollars in the process. This bill was heard and advanced in both the Senate Labor and Industry Committee and the Housing Committee.

Modernizing Building Permit Fees

Substantial valuation variations and large permit fee surpluses in many growing cities have revealed structural problems with valuation-based permitting. SF 801/HF 1085 would end the valuation method of establishing permit costs and instead move to a square footage-based system. This move would ensure that building permits and the homeowners who ultimately pay these costs, are charged fees that are fair, reasonable, and proportionate to the actual costs to perform these inspections and plan reviews. The bill was heard in both chambers and has been laid over for possible inclusion in an omnibus bill.

Increasing Park Dedication Authority

Initiated by the city of Rochester, this bill would create a new park dedication authority for cities of the first class who are approving development projects. The House bill was heard and passed in both the Local Government Division and State Government Finance & Elections Committee and now sits on the House floor. The bill attracted opposition from several housing industry groups.

Street Impact Fees

The street impact fee debate has returned in the 2021 session, continuing many years of discussion surrounding the need and appropriateness of off-site transportation fees in new developments. Prior to the Harstad v. Woodbury Supreme Court decision, many cities were requiring these fees despite having no legislative authority to do so. After the Harstad decision deemed these fees illegal, local government groups have asked the legislature to legalize the fee collection, which would create a new tax on housing developments for future, undefined transportation improvements.

The House bill was heard and passed in both the Local Government Division and State Government Finance & Elections Committee after very contentious hearings. It was ultimately laid over for possible inclusion in an omnibus bill.

Cities Authorized to Establish Street Improvement Districts

A close relative of the street impact fee issue, the proposal for street improvement districts would expand authority by allowing cities to draw street improvement districts where a fee or transportation utility could be required. This would impact both existing and new development. Dozens of businesses and nonprofit organizations stood in opposition when this bill was heard in the House Local Government Division.

Carpet Stewardship Program

Aimed at better managing flooring waste, this bill would create a new program to recycle carpet and has the potential to increase the costs of carpet by 4-6 cents per square foot. As written, it would authorize the commissioner to administratively increase the fees even more in the coming years. The bill was heard in the House Climate Change Committee and was laid over for possible inclusion in an omnibus bill.