The 2025 State Legislative Session Wrap-up

Political environments are rarely static, but this year’s legislative session felt particularly different. The House was split for the first time since 1979, and Democrats only had a one-seat majority in the Senate. On top of partisan tensions, this year was marked by budget constraints. While lawmakers had a small projected surplus for this budget cycle, it was quickly overshadowed by the $6 billion deficit expected in future years. As such, there was a lot to figure out, causing the need for a special session earlier this week to finalize everything. Still, lawmakers managed to avoid a government shutdown and successfully passed a two-year budget.

Despite the unconventional conditions this year, our advocacy work at the Capitol continued. That meant attending committee hearings, collaborating with our coalition partners, testifying for bills, meeting with lawmakers, keeping our network informed with action alerts, and, of course, hosting our annual Habitat on the Hill Day with Habitat Minnesota.

Habitat on the Hill MN

This year’s Habitat on the Hill was an amazing display of community, advocacy, and excitement around affordable homeownership. We had more than 200 people register, representing nearly a third of all House representatives and almost two-thirds of the Senate. Many came from all across the state, including staff and supporters from 10 different Habitat affiliates.

In the morning, supporters gathered for a rally in the Rotunda where they heard from Lt. Governor Peggy Flanagan and the chairs of both Housing committees: Representative Howard, Representative Igo, and Senator Port. Additionally, attendees got to hear from one of our homeowners, Michelle Delgado, who shared the story of how she unlocked homeownership through partnering with Habitat.

“For anyone who has not allowed themselves to dream, we stand in the gap for you,"
Michelle shared, inspiring attendees with her story. “Today, I stand proudly as a Habitat homeowner and say dream on. We are here with you and for you.”

Michelle speaking at Habitat on the Hill.

Attendees then participated in advocacy training to learn about our legislative priorities before meeting with their lawmakers. This year, our agenda was shaped around three main goals:

1. Increasing the supply of affordable homes

2. Ensuring equitable access to homeownership

3. Improve long-term security for homeowners.

Learn more about some of these asks below and how they turned out in the final budget.

HOA reform

One of our biggest priorities this year was pursuing reforms around homeowners’ associations (HOAs), as we’ve seen the need for better regulations and consumer protections in this area. Two main bills were proposed:

1. Establish an ombudsperson position to help resolve HOA disputes

2. Enact a series of reforms addressing issues like transparency, reasonable fines and foreclosure actions, conflicts of interest, and more

Our hard work paid off, and the first bill was successfully adopted by the legislature! We are thrilled that a common interest community ombudsperson position will be created within the Department of Commerce to provide resources to residents and facilitate disputes between owners and associations. There were also two other wins related to this issue – one that clarifies residents have the same right to postpone an HOA foreclosure as a mortgage foreclosure and another that establishes a task force on homeowners' insurance. These are both major wins for foreclosure prevention and in ensuring Minnesotans can continue to afford their homes in the long term.

Unfortunately, the second bill regarding reforms was not passed this year. While we are disappointed to see its delay, we believe our advocacy was still deeply productive to spread more awareness and gain support for this issue amongst lawmakers, and we are confident it will get further next year.

Investing in The Heights

Another one of our goals was to secure funding for The Heights development, an ambitious and innovative transformation coming to St. Paul’s Greater East Side. As this is the largest development Twin Cities Habitat has pursued (more than 1,000 housing units in collaboration with our partners, 147 of which we will develop for homeownership), we know it cannot be achieved without public funding. The housing bill allocated $50 million for housing infrastructure bonds (HIBs) generally, though there was not specific funding set aside for The Heights. Nevertheless, we were grateful to see the enthusiasm amongst lawmakers for this initiative and may pursue another ask in the future.

Recent aerial footage of Habitat homes at The Heights, including 3- and 4-bedroom units, twin homes, and single-family homes—all with solar shingles!

First Generation Down Payment Assistance

One of our proudest wins from the 2023 session was the creation of the First Generation Down-Payment Assistance Program, which helps first-time buyers whose parents never owned a home or lost it to foreclosure. Since then, it’s been widely successful in helping make homeownership accessible to more Minnesotans and closing the racial homeownership gap.

Due to the high demand for this kind of assistance, funds for this program need to be replenished. We advocated for investing $25 million into the Community DPA Fund in FY26 and $50 million in FY27. This program was funded at $2 million for FY26. While this is far less than we asked for, we still consider it a significant win that keeps this new program alive in a year when funding was limited. We’re eager to demonstrate the success of this program and build on it in coming years.

Homeowner Education, Counseling, and Training

Also known as HECAT, this program helps provide a range of much-needed services to buyers and homeowners, including pre-purchase counseling, homebuyer education, and foreclosure prevention. We asked the legislature to increase funding for this program to $4 million. It was not increased but secured ongoing base funding of $1.7 million over this biennium.

Habitat homeowner Michelle, right, meets with her legislator at Habitat on the Hill. 

The housing bill also contained significant allocations for several other important programs, including the Family Homelessness Prevention Assistance Program (FHPAP), the Economic Development & Housing Challenge Program (EDHC), the Workforce Homeownership Program (WHOM), and more. These programs, alongside our direct asks, are crucial for helping our work to produce and preserve affordable homeownership opportunities.

Though many programs were funded at less than we asked for, we are excited and deeply grateful to see how much homeownership was prioritized this session even amidst limited funding. The strong support we’ve seen from our housing chairs, legislative champions, and across the aisle goes to show the shared understanding we all have – that homeownership is the foundation for families and communities to thrive. This support drives our work, and we will build on these wins during next year’s session.

In the meantime, our work will continue, and there are many ways to get involved. You can stay active by sending a letter to the housing chairs thanking them for their commitment to our work and by signing up for action alerts to stay up to date in the future. Click here to see more photos from Habitat on the Hill 2025.