2023 WISCONSIN ACT 14
An Act to create 234.66 of the statutes; relating to: residential housing infrastructure revolving loan fund and revolving loan program.
The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:
14,1Section 1. 234.66 of the statutes is created to read: 234.66 Residential housing infrastructure revolving loan fund and program. (1) Definitions. In this section:
(a) “Area median income” means the area median family income in the county in which the housing is located, adjusted for family size, as published annually by the federal department of housing and urban development.
(b) “Developer” means a person other than a governmental unit that constructs or creates residential housing.
(c) “Eligible governmental unit” means the governmental unit having jurisdiction of an eligible project, as determined by the authority.
(d) “Eligible project” means a project for housing infrastructure for workforce housing or senior housing.
(dd) “Governmental unit” means a city, village, town, or county or federally recognized American Indian tribe or band in this state.
(e) “Housing infrastructure” means that portion of the installation, replacement, upgrade, or improvement of public infrastructure, or private infrastructure in rural areas if transferred to public use, as determined by the authority, that relates to an eligible project.
(f) “Public infrastructure” means any of the following that is or will be owned, maintained, or provided to or by a governmental unit:
1. A water distribution system.
2. A water treatment plant.
3. A wastewater treatment plant.
4. A sanitary sewer system.
5. A storm sewer system.
6. A stormwater retention pond.
7. A lift or pump station.
8. A street, road, alley, or bridge.
9. A curb, gutter, or sidewalk.
10. A traffic device.
11. A street light.
12. An electric or gas distribution line.
(g) “Residential housing” means new single-family or multifamily housing for rent or sale that satisfies all of the following:
1. Is subject to taxation under ch. 70.
2. Has not been the subject of a claim for a state or federal historic rehabilitation tax credit, as determined by the authority.
3. Has not received financial assistance from tax increments generated by an active tax incremental district.
(h) “Senior housing” means residential housing that satisfies par. (i) 1. to 4. and that is intended and operated primarily for occupancy by at least one person 55 years of age or older per dwelling unit, as determined by the authority.
(i) “Workforce housing” means residential housing that satisfies all of the following, as determined by the authority:
1. For housing intended to be rented, the estimated annual housing costs, as defined under s. 16.301 (3), do not exceed, or are not expected to exceed, 30 percent of 100 percent of the area median income, with family size determined using the federal imputed income limitation, as defined in 26 USC 42 (g) (2) (C), and the utility-related costs if not included in the rent equal the utility allowance determined by the federal department of housing and urban development.
2. For housing intended to be occupied by the owner, the estimated annual housing costs, as defined under s. 16.301 (3), do not exceed, or are not expected to exceed, 30 percent of 140 percent of the area median income, with family size determined using the federal imputed income limitation, as defined in 26 USC 42 (g) (2) (C).
3. For housing intended to be rented, the housing is for occupancy by individuals whose annual household income does not exceed 100 percent of the area median income.
4. For housing intended to be occupied by the owner, the housing is for purchase by individuals whose annual household income is not more than 140 percent of the area median income.
(2) Establishment of fund. (a) There is established under the jurisdiction and control of the authority a residential housing infrastructure revolving loan fund, for the purpose of providing loans under sub. (3). The authority may use moneys in the fund to cover actual and necessary expenses incurred to accomplish the purposes of this section, including marketing expenses under sub. (6), and administer the fund. The fund shall consist of all of the following:
1. All moneys appropriated to the authority for the fund.
2. All moneys received from the repayment of loans under sub. (3).
(am) In its discretion, the authority may invest fund moneys that are not required for immediate use or disbursement in all of the following to the extent lawful for fiduciaries in this state:
1. An obligation of the United States or one of its agencies or instrumentalities, or an obligation the principal and interest of which are guaranteed by the United States or one of its agencies or instrumentalities.
2. An obligation of any state, or of any county, city, or other political subdivision of a state, having long-term ratings in the AA category or higher.
3. A certificate of deposit.
4. The state investment fund.
5. A money market mutual fund restricted to one or more investments as provided in subd. 1., 2., 3., or 4.
(an) All investments under par. (am) shall be the exclusive property of the fund. All earnings on or income from such investments shall be credited to the fund.
(b) Of the amounts deposited in the fund under par. (a) 1. in the 2023-25 fiscal biennium, the authority shall return to the secretary of administration for deposit in the general fund all such amounts not encumbered or expended for an eligible project as of the first day of the 8th year beginning after the effective date of this paragraph .... [LRB inserts date].
(c) No moneys in the fund may be invested under s. 234.03 (18).
(3) Establishment of revolving loan program. The authority shall establish and administer a residential housing infrastructure revolving loan program for the purpose of awarding loans under this section.
(4) Loans to residential housing developers. (a) From the residential housing infrastructure revolving loan fund, the authority may award loans to developers to cover housing infrastructure costs for an eligible project. Any developer may apply to the authority for a loan under this subsection in accordance with the application process established by the authority under par. (b), but the authority may not award the loan unless the developer and the eligible governmental unit demonstrate to the satisfaction of the authority in one or more forms prescribed by the authority that all of the following apply:
1. The developer has secured the necessary financial resources for the total cost of development of the residential housing supported by the eligible project.
2. The developer has secured all applicable federal, state, and local government permits or other approvals for the eligible project and the residential housing supported by the eligible project.
4. Any applicable sewer or water service area plan has been amended if necessary.
5. The eligible governmental unit has reduced the cost of residential housing in connection with the eligible project by voluntarily revising zoning ordinances, subdivision regulations, or other land development regulations to increase development density, expedite approvals, reduce impact, water connection, and inspection fees, or reduce parking, building, or other development costs with respect to the development of residential housing supported by the project. For purposes of this subdivision, the governmental unit in cooperation with the developer shall submit to the authority a cost reduction analysis in a form prescribed by the authority and signed by the developer and the head of the governmental unit’s governing body that shows the cost reduction measures, including time saving measures, undertaken by the governmental unit on or after January 1, 2023, that have reduced the cost of residential housing in connection with the eligible project. The signed analysis shall clearly show for each time saving or cost reduction measure the estimated time or dollar amount saved by the developer and the estimated percentage reduction in housing costs.
6. The eligible governmental unit is in compliance with the requirements under ss. 66.1001, 66.10013, and 66.10014, to the extent those requirements apply to the governmental unit.
7. If applicable, the eligible governmental unit has updated the housing element of its comprehensive plan under s. 66.1001 (2) (b) within the 5 years immediately preceding the date of the loan application.
(b) The authority shall establish and provide a semiannual application process, including underwriting guidelines, for the award of loans under this subsection. If in any application cycle there are insufficient moneys available in the residential housing infrastructure revolving loan fund to fund all applications that meet the requirements under par. (a) and are otherwise acceptable to the authority, the authority shall prioritize funding loans for eligible projects in eligible governmental units that have reduced the cost of residential housing as described in par. (a) 5. but with respect to the governmental unit as a whole.
(c) 1. The authority may establish an interest rate for any loan awarded under this subsection at or below the market interest rate or may charge no interest.
2. No loan awarded under this subsection may exceed 20 percent of the total cost of development, including land purchase, of the residential housing supported by the eligible project.
(d) The authority shall set aside 25 percent of all moneys deposited in the fund under sub. (2) (a) 1. in the 2023-25 fiscal biennium for a period of not less than 4 years following the effective date of this paragraph .... [LRB inserts date], for loans awarded under this subsection and sub. (5) for eligible projects supporting senior housing. For purposes of this paragraph, if a loan supports both workforce housing and senior housing, the amount of such loan supporting senior housing shall be calculated by prorating the loan amount between the 2 uses based on the number of residential housing units supported by the loan.
