AB 1096

This bill establishes a gap funding for workforce housing revolving loan fund under the jurisdiction and control of the Wisconsin Housing and Economic Development Authority. WHEDA is directed to issue bonds for the purpose of depositing moneys into the fund, not to exceed $50,000,000. The purpose of the fund is for WHEDA to award revolving loans, as specified in the bill, to residential housing developers to provide gap funding for an eligible project, meaning a project related to the construction or creation of workforce housing in this state for which the developer has already received financial assistance for a portion of the project’s costs. “Workforce housing” is defined on the basis of the ratio of housing costs and the ratio of household income to the area median income of the county in which the housing is located, adjusted for family size, as published annually by the Department of Housing and Urban Development.

Developers must apply for a loan under the bill in collaboration with an “eligible governmental unit,” which is defined as a city, village, town, county, or federally recognized American Indian tribe or band in this state in which the eligible project is located, and in accordance with a semiannual application process established by WHEDA.

To receive a loan under the bill, a developer must demonstrate to WHEDA that all of the following apply:

1. The developer has secured the necessary financial resources for the remaining cost of the eligible project not to be covered by the loan under the bill.

2. The developer has secured all applicable federal, state, and local government permits or other approvals for the eligible project.

3. Any applicable sewer or water service area plan has been amended if necessary.

4. The eligible governmental unit has entered into an agreement or memorandum of understanding with the developer for the eligible project at issue.

WHEDA may establish an interest rate for any loan awarded under the bill at or below the interest rate for any bonds issued under the bill, plus 0.5 percent. Also under the bill, no loan awarded may be for an amount greater than $3,000,000.

The bill requires that WHEDA enter into an agreement with each developer receiving a loan that establishes the term and other conditions of the loan and requires that housing constructed in connection with the loan be for initial occupancy by individuals whose annual household income does not exceed 120 percent of the area median 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.

WHEDA must also divide the state into regions based on the service jurisdiction of each regional planning commission constituted under current law, with the counties not served by a regional planning commission constituting collectively one region. Under the bill, in any given application cycle, no such region may receive loans that amount to more than 12.5 percent of the moneys deposited into the fund in the 2025-27 fiscal biennium from bonding.

Finally, the bill requires that WHEDA market the availability of loans under the bill and submit annual reports to the appropriate standing committees of the legislature related to the gap funding for workforce housing revolving loan fund and program created under the bill.

Because this bill may increase or decrease, directly or indirectly, the cost of the development, construction, financing, purchasing, sale, ownership, or availability of housing in this state, the Department of Administration, as required by law, will prepare a report to be printed as an appendix to this bill.