This bill allows a municipality to establish a local housing investment fund
program. Under such a program, a municipality may designate qualifying parcels
as housing investment fund properties and collect tax revenues on any valuation
increases on these properties. These revenues may be used only for certain purposes
related to increasing the supply of housing available for persons with moderate
income, including providing financing for the provision of new workforce housing
units, funding infrastructure costs related to the provision of workforce housing, and
funding improvements to workforce housing units owned by the municipality or the
county in which the municipality is located.

Parcels that may be designated under the program are 1) parcels containing a
vacant building that will be converted into dwelling units, 2) parcels that have been
acquired by the municipality or the county in which the municipality is located
through foreclosure, that contain existing dwelling units, and that will be sold to and
improved by another person, 3) parcels consisting of land on which new dwelling
units will be constructed, and 4) parcels on which additional dwelling units will be
developed. When a property is designated, the municipality must determine the
value of the taxable property located on the parcel. Then, for each year commencing
after the completion of improvements on the designated property, the municipality
must determine the valuation increase for the designated property by subtracting
the base value from the equalized value of the taxable property located in that parcel

for that year. If this amount is positive for a year, the portion of taxes collected on
this valuation increase are paid to the designating municipality for deposit into the
housing investment fund for use for purposes related to increasing the supply of
housing available for persons with moderate income. Under the bill, a designating
municipality may collect taxes on valuation increases for a particular property for
two years, if the municipality is a first or second class city, or for five years, if the
municipality is a third or fourth class city, a village, or a town.