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AB 1096

Relating to: a revolving loan program to provide gap funding for workforce housing programs and granting bonding authority. (FE)

2025-2026 Regular Session Introduced by Margaret Arney and 8 co-sponsors

Wisconsin would create a WHEDA gap-funding revolving loan program, with up to $50M bonds to fund loans up to $3M each for workforce housing projects serving households at or below

Fiscal estimate received
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Bill Summary · AB 1096

Summary of Assembly Bill 1096 (2025 Session, Wisconsin)

Proposed by: Representatives Rivera-Wagner, Arney, Brown, Goodwin, Ortiz-Velez, Roe, Sinicki, Stubbs, Taylor; additional co-sponsors listed.

Committee: Housing and Real Estate

Status: Introduced March 13, 2026; referred to the Committee on Housing and Real Estate. Fiscal note and related materials prepared (fiscal estimate received March 30, 2026).

purpose and intent
- Create a dedicated gap-funding revolving loan program to support the development of workforce housing in Wisconsin.
- Provide bonding authority to finance the program, under the Wisconsin Housing and Economic Development Authority (WHEDA).
- Structure the program as a revolving fund that enables loans to residential housing developers to cover the gap between project costs and available financing.

Key provisions and changes

1) Establishment and authority
- Creates a new section, 234.663, establishing a gap funding for workforce housing revolving loan fund under WHEDA.
- WHEDA may issue negotiable bonds up to $50,000,000 to deposit into the revolving fund, establish reserves, and cover program administration costs.
- Bond limitations in other Wisconsin housing statutes (ss. 234.18, 234.40, 234.50, 234.60, 234.61, 234.65) do not apply to bonds issued for this new fund.

2) Definitions
- Defines core terms: area median income (AMI) by county, eligible project, developer, eligible governmental unit, regional boundaries, and workforce housing criteria.
- Workforce housing criteria:
- Estimated annual housing costs not exceeding 30% of 120% of AMI for the county (adjusted for family size per HUD).
- Occupancy by individuals with annual household incomes not exceeding 120% of AMI.

3) Fund establishment and operation
- The fund is established under WHEDA, to be used for gap funding loans to developers for eligible workforce housing projects.
- Fund components:
- Principal deposits from bond proceeds.
- Repayments of loans awarded.
- WHEDA may invest idle fund money in specified conservative investments and credit earnings to the fund.

4) Loan program specifics
- Eligible recipients: developers working with an eligible governmental unit (city, village, town, county, or tribal entity).
- Loan amount cap: any single loan may not exceed $3,000,000.
- Terms: WHEDA must enter into loan agreements specifying terms; loans are designed so initial occupancy is limited to households at or below 120% AMI.
- Interest rates: set at or below the bond interest rate for the fund, plus up to 0.5 percentage points (or WHEDA may set zero interest).
- Application process: semiannual application rounds; developers must show:
- Secured resources to cover remaining project costs not financed by the WHEDA loan.
- Secured all federal, state, and local permits/approvals.
- Any needed sewer/water service area plan amendments completed.
- An agreement or MOU with the eligible governmental unit.

5) Regional distribution and caps
- The state is divided into regions based on the jurisdiction of current regional planning commissions; counties not served by a regional planning commission form a single region.
- In any application cycle, no region may receive more than 12.5% of the fund’s 2025-27 deposits in loans under the program.

6) Administration, marketing, and reporting
- WHEDA must market the loan program and establish policies for underwriting, loan guarantees, and repayment requirements.
- Annual reporting: WHEDA must submit by August 1 each year to the legislature:
- The fund’s balance and condition.
- Details on each loan (date, amount, amortization period, status; recipient; funded project; eligible governmental unit).
- The number and characteristics of dwelling units created, with locations and pricing data.

7) Additional timeline and sunset references
- The statute provides an explicit 5-year cap on the ability to award new loans under the subsection governing the revolving fund (no new loans after five years from the date WHEDA first accepts applications under that subsection).
- The bill requires an appendix-level fiscal impact analysis and a Department of Administration report due to potential changes in housing costs and market conditions.

Impact and who is affected

  • WHEDA gains a new revolving loan program and bonding authority to fund gap financing for workforce housing.
  • Developers of eligible workforce housing projects can obtain up to $3 million per loan to bridge funding gaps, provided they meet underwriting and collaboration requirements.
  • Eligible governmental units (cities, villages, towns, counties, or tribal entities) collaborate with developers to support project approvals, permits, and MOU/agreements.
  • Regions are capped in the share of funding, potentially influencing where projects are pursued.
  • The program targets households at or below 120% AMI, aiming to increase the supply of workforce housing within economically feasible cost structures.

Notes

  • The fiscal impact and administrative details will be clarified in the attached fiscal estimate and appendix materials.
  • The bill does not modify federal housing program definitions beyond aligning with WHEDA’s new gap-funding framework.

Compiled from official sources — confirm details with the bill’s official record.

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