LRB-5005/1
MPG&AJM:amn/jld/ahe
2017 - 2018 LEGISLATURE
December 28, 2017 - Introduced by Representatives Loudenbeck, Fields, Allen,
Anderson, Berceau, Considine, Krug, Mursau, Novak, Rohrkaste, Sinicki,
Tauchen, Zepnick, Crowley, Ballweg and Spiros, cosponsored by Senators
Darling and Bewley. Referred to Committee on Housing and Real Estate.
AB809,1,9 1An Act to repeal 234.01 (6) (b), 234.01 (8) (b), 234.01 (9) (a) 5., 234.13, 234.59
2(3) (bc) and 234.60 (3); to consolidate, renumber and amend 234.01 (6)
3(intro.) and (a) and 234.01 (8) (intro.) and (a); to amend 234.01 (9) (a) (intro.),
4234.01 (9) (a) 1., 234.01 (9) (a) 2., 234.01 (9) (a) 3., 234.01 (9) (a) 4., 234.53 (2),
5234.55 (1) and 234.65 (1) (c) 2.; and to create 234.135, 234.53 (2m), 234.59 (2)
6(f), 234.59 (3) (bd) and 234.59 (3) (e) 3m. of the statutes; relating to: notes,
7bonds, and economic development programs of the Wisconsin Housing and
8Economic Development Authority, homeownership mortgage loans used to
9refinance existing mortgages, and uses of the housing rehabilitation loan fund.
Analysis by the Legislative Reference Bureau
This bill makes a number of changes to the laws governing the Wisconsin
Housing and Economic Development Authority, including the following:
1. Eliminates the requirement that certain organizations participating in
WHEDA's programs allow WHEDA under certain circumstances to appoint a
majority of the members of the organization's governing body.
2. Authorizes WHEDA to hold, sell, or cancel WHEDA's notes or bonds WHEDA
itself purchases. Under current law, such notes or bonds must be canceled.

3. Provides that every four years, beginning in 2018, WHEDA may request
approval of the Joint Committee on Finance to issue additional notes and bonds in
the amount specified in the request for economic development purposes if the
authority determines that the issuance of additional notes and bonds will promote
significant economic development in this state.
4. Authorizes WHEDA to issue a homeownership mortgage loan to a
homeowner for the refinancing of the homeowner's existing mortgage if the property
is located in an area in a first class city in which WHEDA determines there is a high
concentration of persons and families of low and moderate income, the homeowner
does not qualify for a mortgage loan through other lenders, and the homeownership
mortgage loan WHEDA issues is used in part to finance rehabilitation of the eligible
property.
5. Allows WHEDA to use moneys from its housing rehabilitation loan fund to
purchase or fund loans under any down payment assistance program established by
WHEDA. Current law requires WHEDA to use moneys from the housing
rehabilitation loan fund for funding housing rehabilitation loans or administering
the housing rehabilitation loan program.
For further information see the state and local fiscal estimate, which will be
printed as an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB809,1 1Section 1. 234.01 (6) (intro.) and (a) of the statutes are consolidated,
2renumbered 234.01 (6) and amended to read:
AB809,2,83 234.01 (6) “Housing corporation" means a corporation organized under s.
4182.004 and whose articles of incorporation, in addition to other requirements of law,
5provide that: (a) If if the corporation receives any loan or advance from the authority
6under this chapter, it may enter into an agreement with the authority providing for
7regulation with respect to rents, profits, dividends, and disposition of property or
8franchises; and.
AB809,2 9Section 2. 234.01 (6) (b) of the statutes is repealed.
AB809,3 10Section 3. 234.01 (8) (intro.) and (a) of the statutes are consolidated,
11renumbered 234.01 (8) and amended to read:
AB809,3,6
1234.01 (8) “Limited-profit entity" means any person or trust which, in its
2whose articles of incorporation or comparable documents of organization, or by
3whose written agreement with the authority, provides that: (a) As, as a condition
4of acceptance of a loan or advance under this chapter, the limited-profit entity shall
5enter into an agreement with the authority providing for limitations of rents, profits,
6dividends, and disposition of property or franchises ; and.
AB809,4 7Section 4. 234.01 (8) (b) of the statutes is repealed.
AB809,5 8Section 5. 234.01 (9) (a) (intro.) of the statutes is amended to read:
AB809,3,119 234.01 (9) (a) (intro.) A nonprofit corporation incorporated under ch. 181 whose
10articles of incorporation, in addition to other requirements of law, provide that all of
11the following
:
AB809,6 12Section 6. 234.01 (9) (a) 1. of the statutes is amended to read:
AB809,3,1413 234.01 (9) (a) 1. The corporation has as its major purpose the providing of
14housing facilities for persons and families of low and moderate income ;.
AB809,7 15Section 7. 234.01 (9) (a) 2. of the statutes is amended to read:
AB809,3,1816 234.01 (9) (a) 2. All income and earnings of the corporation shall be used
17exclusively for corporation purposes and no part of the net income or net earnings
18of the corporation shall inure to the benefit or profit of any private person;.
AB809,8 19Section 8. 234.01 (9) (a) 3. of the statutes is amended to read:
AB809,3,2320 234.01 (9) (a) 3. The corporation is in no manner controlled or under the
21direction or acting in the substantial interest of private persons seeking to derive
22profit or gain therefrom or seeking to eliminate or minimize losses in any dealing or
23transactions therewith;.
AB809,9 24Section 9. 234.01 (9) (a) 4. of the statutes is amended to read:
AB809,4,4
1234.01 (9) (a) 4. If the corporation receives any loan or advance from the
2authority, it shall enter into an agreement with the authority, providing for
3limitations on rents, profits, dividends, and disposition of property or franchises;
4and
.
AB809,10 5Section 10. 234.01 (9) (a) 5. of the statutes is repealed.
AB809,11 6Section 11. 234.13 of the statutes is repealed.
AB809,12 7Section 12. 234.135 of the statutes is created to read:
AB809,4,11 8234.135 Same; purchase; cancellation. (1) The authority may purchase
9any notes or bonds of the authority. The authority may hold or sell, in whole or in
10part and separately or together with other notes or bonds of the authority, notes or
11bonds purchased under this subsection.
AB809,4,15 12(2) Subject to such agreements with noteholders or bondholders as may then
13exist, any notes or bonds purchased and held by the authority under sub. (1), may,
14upon the affirmative designation of the authority, be canceled, in whole or in part,
15at the time specified in the authority's designation.
AB809,13 16Section 13 . 234.53 (2) of the statutes is amended to read:
AB809,4,2217 234.53 (2) The Except as provided in sub. (2m), the authority shall use moneys
18in the fund for the purpose of purchasing housing rehabilitation loans or for funding
19commitments for loans to lenders for housing rehabilitation loans. All
20disbursements of funds under this section subsection for purchasing such loans shall
21be made payable to an authorized lender as defined in s. 234.49 (1) (b) or a duly
22authorized agent thereof.
AB809,14 23Section 14 . 234.53 (2m) of the statutes is created to read:
AB809,5,3
1234.53 (2m) The authority may use moneys in the fund for the purpose of
2funding or purchasing loans under any down payment assistance program
3established by the authority.
AB809,15 4Section 15 . 234.55 (1) of the statutes is amended to read:
AB809,5,185 234.55 (1) The authority shall establish the housing rehabilitation loan
6program bond redemption fund. All housing rehabilitation loans purchased with
7moneys from the housing rehabilitation loan fund or notes evidencing loans to
8lenders from such fund for housing rehabilitation loans shall be the exclusive
9property of such redemption fund. All moneys received from the repayment of such
10loans, any amounts transferred by the authority to such fund pursuant to s. 234.52
11or from other funds or sources, any federal insurance or guarantee payments with
12respect to such loans, all moneys resulting from the sale of bonds for the purpose of
13refunding outstanding housing rehabilitation bonds unless credited to the housing
14rehabilitation loan program capital reserve fund, and any other moneys which may
15be available to the authority for the purpose of such fund, and all moneys received
16from the repayment of loans provided under s. 234.53 (2m)
shall be deposited into
17such fund to be used for the repayment of housing rehabilitation bonds issued under
18the authority of s. 234.50.
AB809,16 19Section 16. 234.59 (2) (f) of the statutes is created to read:
AB809,5,2220 234.59 (2) (f) May make a loan to a veteran, as defined in 38 USC 101 (2), who
21has not previously received a homeownership mortgage loan financed by bonds or
22notes issued under s. 234.60.
AB809,17 23Section 17. 234.59 (3) (bc) of the statutes is repealed.
AB809,18 24Section 18. 234.59 (3) (bd) of the statutes is created to read:
AB809,6,7
1234.59 (3) (bd) 1. To the extent required as a condition to maintaining the
2exclusion from gross income for federal income tax purposes of interest on bonds,
3notes, or other evidences of indebtedness issued by or on behalf of the authority, a
4homeownership mortgage loan under this section shall be made to an applicant
5whose income does not exceed the applicable level specified under 26 USC 143 (f).
6The authority shall determine an applicant's income in the manner specified under
726 USC 143 (f) and applicable rulings of the Internal Revenue Service.
AB809,6,118 2. Nothing under this section precludes the authority from imposing income
9limitations that are more restrictive than the income level determined in the manner
10specified under 26 USC 143 (f) and applicable rulings of the Internal Revenue
11Service.
AB809,19 12Section 19 . 234.59 (3) (e) 3m. of the statutes is created to read:
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