Proposed Residential Construction Changes Advance in the House

April 4, 2022

The two bills contain less controversial provisions that were separated from the problematic zoning preemption bill.

Two less controversial residential construction provisions from HF 3256, a larger zoning preemption bill, were heard as separate bills on March 31 by the House State Government Finance and Elections Committee.

HF 4141 (Rep. Steve Elkins, DFL-Bloomington), which would prohibit cities from banning modular building, was passed unanimously and sent to the general register, where it can be heard by the full House.

HF 4271 (Rep. Elkins), which proposes a new valuation basis for residential construction, was passed, 12-1, and sent to the House Ways and Means Committee.

Allowance for modular building statewide

Current law prohibits municipalities from banning manufactured homes. HF 4141 would similarly prohibit municipalities from banning industrialized or modular buildings for residential use.

Minnesota has modular construction manufacturers, where inspection of the modular construction is completed by state building officials. When they are moved onto a construction site, local building officials inspect the remaining issues covered by the State Building Code (i.e., water and sewer hookups).

The League is unaware of any cities with zoning ordinances prohibiting this type of building.

Proposed new valuation basis for residential construction

HF 4271 would require the Department of Labor and Industry to establish construction valuation for Minnesota that is based on cost-per-square-foot, which is based on the recommendation from the Technical Advisory Group (TAG) that met in 2021. Representatives from cities and building officials served on this TAG, along with builders and developers.

Read about the TAG recommendations in a previous article

This bill is different from previous legislation that required building permit fees to be based on cost-per-square-foot, which was problematic. Here, the bill would establish statewide valuation to be used by all municipalities, but still allow municipalities to adopt fee schedules to account for the cost of building inspection.

Also, the bill would increase the threshold for greater reporting of the Municipal Fee and Expense Report. Current law requires municipalities who receive more than $5,000 in construction and development-related fees to provide more information on this report. The bill would increase this threshold to $7,000.

City input requested

The League has been working with the Association of Minnesota Building Officials on both bills. However, the League also appreciates city insights on these bills. To provide your city’s perspective, contact Irene Kao, LMC, at ikao@lmc.org or (651) 281-1260.

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