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SB-939, As Passed Senate, May 19, 2026
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SENATE BILL NO. 939
A bill to amend 1966 PA 346, entitled
"State housing development authority act of 1966,"
by amending section 22 (MCL 125.1422), as amended by 2012 PA 327.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 22. The authority possesses all powers necessary or 1
convenient to carry out this act, including the following powers in 2
addition to other powers granted by other provisions of this act: 3
(a) To sue and to be sued; to have a seal and to alter the 4
seal at pleasure; to have perpetual succession; to make and execute 5
April 29, 2026, Introduced by Senators OUTMAN, CHERRY, BAYER, CHANG, BELLINO,
HAUCK, IRWIN, SHINK and CAVANAGH and referred to Committee on Regulatory
Affairs.
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contracts and other instruments necessary or convenient to the 1
exercise of the powers of the authority; and to make, amend, and 2
repeal bylaws and rules. 3
(b) To undertake and carry out studies and analyses of housing 4
needs within this state and ways of meeting those needs, including 5
data with respect to population and family groups, the distribution 6
of population and family groups according to income, and the amount 7
and quality of available housing and its distribution according to 8
rentals and sales prices, employment, wages, and other factors 9
affecting housing needs and the meeting of housing needs; to make 10
the results of those studies and analyses available to the public 11
and the housing and supply industries; and to engage in research 12
and disseminate information on housing. 13
(c) To agree and comply with conditions attached to federal 14
financial assistance. 15
(d) To survey and investigate housing conditions and needs, 16
both urban and rural, throughout this state and make 17
recommendations to the governor and the legislature regarding 18
legislation and other measures necessary or advisable to alleviate 19
any existing housing shortage in this state. 20
(e) To establish and collect fees and charges in connection 21
with the sale of the authority's publications and the authority's 22
loans, commitments, and servicing, including, but not limited to, 23
the reimbursement of costs of financing by the authority, service 24
charges, and insurance premiums as the authority determines to be 25
reasonable and as approved by the authority. Fees and charges shall 26
must be determined by the authority and shall are not be considered 27
to be interest. The authority may use any accumulated fees and 28
charges and interest income for achieving any of the corporate 29
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purposes of the authority, to the extent that the fees, charges, 1
and interest income are not pledged to the repayment of bonds and 2
notes of the authority or the interest on those bonds and notes. 3
(f) To encourage community organizations to assist in 4
initiating housing projects as provided in this act. 5
(g) To encourage the salvage of all possible usable housing 6
scheduled for demolition because of highway, school, urban renewal, 7
or other programs by seeking authority for the sponsors of the 8
programs to use funds provided for the demolition of the buildings, 9
to be allocated to those sponsors approved by the authority to 10
defray moving and rehabilitation costs of the buildings. 11
(h) To engage and encourage research in, and to formulate 12
demonstration projects to develop, new and better techniques and 13
methods for increasing the supply of housing for persons eligible 14
for assistance as provided in this act; and to provide technical 15
assistance in the development of housing projects and in the 16
development of programs to improve the quality of life for all the 17
people of this state. 18
(i) To make or purchase loans, including loans for condominium 19
units as that term is defined in section 4 of the condominium act, 20
1978 PA 59, MCL 559.104, and including loans to mortgage lenders , 21
which that are unsecured or the repayments of which are secured by 22
mortgages, security interests, or other forms of security; to 23
purchase and enter into commitments for the purchase of securities, 24
certificates of deposits, time deposits, or mortgage loans from 25
mortgage lenders; to participate in the making or purchasing of 26
unsecured or secured loans and undertake commitments to make or 27
purchase unsecured or secured loans; to sell mortgages, security 28
interests, notes, and other instruments or obligations evidencing 29
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or securing loans, including certificates evidencing interests in 1 1
or more loans, at public or private sale; in connection with the 2
sale of an instrument or obligation evidencing or securing 1 or 3
more loans, to service, guarantee payment on, or repurchase the 4
instrument or obligation, whether or not it is in default; to 5
modify or alter mortgages and security interests; to foreclose on 6
any mortgage, security interest, or other form of security; to 7
finance housing units; to commence an action to protect or enforce 8
a right conferred upon on the authority by law, mortgage, security 9
agreement, contract, or other agreement; to bid for and purchase 10
property that was the subject of the mortgage, security interest, 11
or other form of security, at a foreclosure or at any other sale, 12
and to acquire or take possession of the property. Upon On 13
acquiring or taking possession of the property, the authority may 14
complete, administer, and pay the principal and interest of 15
obligations incurred in connection with the property, and may 16
dispose of and otherwise deal with the property in any manner 17
necessary or desirable to protect the interests of the authority in 18
the property. If the authority or an entity that provides mortgage 19
insurance to the authority acquires property upon on the default of 20
a borrower, the authority may make a mortgage loan to a subsequent 21
purchaser of that property even if the purchaser does not meet 22
otherwise applicable income limitations and purchase price limits. 23
(j) To set standards for housing projects that receive loans 24
under this act and to provide for inspections to determine 25
compliance with those standards. The standards for construction and 26
rehabilitation of mobile homes, mobile home parks, and mobile home 27
condominium projects shall must be established jointly by the 28
authority and the mobile home commission, created in section 3 of 29
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the mobile home commission act, 1987 PA 96, MCL 125.2303. However, 1
financing Financing standards shall must be established solely by 2
the authority. 3
(k) To accept gifts, grants, loans, appropriations, or other 4
aid from the federal, state, or local government, from a 5
subdivision, agency, or instrumentality of a federal, state, or 6
local government, or from a person, corporation, firm, or other 7
organization. 8
(l) To acquire or contract to acquire from a person, firm, 9
corporation, municipality, or federal or state agency, by grant, 10
purchase, or otherwise, leaseholds or real or personal property, or 11
any interest in a leasehold or real or personal property; to own, 12
hold, clear, improve, and rehabilitate and to sell, assign, 13
exchange, transfer, convey, lease, mortgage, or otherwise dispose 14
of or encumber any interest in a leasehold or real or personal 15
property. This act shall does not impede the operation and effect 16
of local zoning, building, and housing ordinances, ordinances 17
relating to subdivision control, land development, or fire 18
prevention, or other ordinances having to do with housing or the 19
development of housing. 20
(m) To procure insurance against any loss in connection with 21
the property and other assets of the authority. 22
(n) To invest, at the discretion of the authority, funds held 23
in reserve or sinking funds, or money not required for immediate 24
use or disbursement, in obligations of this state or of the United 25
States, in obligations the principal and interest of which are 26
guaranteed by this state or the United States, or in other 27
obligations as may be approved by the state treasurer. 28
(o) To promulgate rules necessary to carry out the purposes of 29
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this act and to exercise the powers expressly granted in this act 1
pursuant to under the administrative procedures act of 1969, 1969 2
PA 306, MCL 24.201 to 24.328. 3
(p) To enter into agreements with nonprofit housing 4
corporations, consumer housing cooperatives, limited dividend 5
housing corporations, mobile home park corporations, and mobile 6
home park associations that provide for regulation by the authority 7
of the planning, development, and management of any housing project 8
undertaken by nonprofit housing corporations, consumer housing 9
cooperatives, limited dividend housing corporations, mobile home 10
park corporations, and mobile home park associations and that 11
provide for the disposition of the property and franchises of those 12
corporations, cooperatives, and associations. 13
(q) To appoint to the board of directors of a nonprofit 14
housing corporation, consumer housing cooperative, limited dividend 15
housing corporation, mobile home park corporation, or mobile home 16
park association, a number of new directors sufficient to 17
constitute a majority of the board notwithstanding other provisions 18
of the articles of incorporation or other provisions of law. 19
Directors appointed under this subsection need not be stockholders 20
or members or meet other qualifications that may be described by 21
the certificate of incorporation or bylaws. In the absence of fraud 22
or bad faith, directors appointed under this subsection shall are 23
not be personally liable for debts, obligations, or liabilities of 24
the corporation or association. The authority may appoint directors 25
under this subsection only if 1 or more of the following occur: 26
(i) The nonprofit housing corporation, consumer housing 27
cooperative, limited dividend housing corporation, mobile home park 28
corporation, or mobile home park association has received a loan or 29
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advance, as provided for in this act, and the authority determines 1
that the loan or advance is in jeopardy of not being repaid. 2
(ii) The nonprofit housing corporation, consumer housing 3
cooperative, limited dividend housing corporation, mobile home park 4
corporation, or mobile home park association received a loan or 5
advance as provided for in this act and the authority determines 6
that the proposed housing project for which the loan or advance was 7
made is in jeopardy of not being constructed. 8
(iii) The authority determines that some part of the net income 9
or net earnings of the nonprofit housing corporation is inuring to 10
the benefit of a private individual, firm, corporation, 11
partnership, or association; the authority determines that an 12
unreasonable part of the net income or net earnings of the consumer 13
housing cooperative is inuring to the benefit of a private 14
individual, firm, corporation, partnership, or association; or the 15
authority determines that some part of the net income or net 16
earnings of the limited dividend housing corporation, in excess of 17
that permitted by other provisions of this act, is inuring to the 18
benefit of a private individual, firm, corporation, partnership, or 19
association. 20
(iv) The authority determines that the nonprofit corporation or 21
consumer housing cooperative is in some manner controlled by, under 22
the direction of, or acting in the substantial interest of a 23
private individual, firm, corporation, partnership, or association 24
seeking to derive benefit or gain from, or seeking to eliminate or 25
minimize losses in any dealings or transactions with, the nonprofit 26
corporation or consumer housing cooperative. However, this This 27
subparagraph shall apply applies to individual cooperators in 28
consumer housing cooperatives only in circumstances defined by the 29
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authority in its rules. 1
(v) The authority determines that the nonprofit housing 2
corporation, consumer housing cooperative, limited dividend housing 3
corporation, mobile home park corporation, or mobile home park 4
association is in violation of the rules promulgated under this 5
section. 6
(vi) The authority determines that the nonprofit housing 7
corporation, consumer housing cooperative, limited dividend housing 8
corporation, mobile home park corporation, or mobile home park 9
association is in violation of 1 or more agreements entered into 10
with the authority that provide for regulation by the authority of 11
the planning, development, and management of a housing project 12
undertaken by the nonprofit housing corporation, consumer housing 13
cooperative, limited dividend housing corporation, mobile home park 14
corporation, or mobile home park association or that provide for 15
the disposition of the property and franchises of the corporation, 16
cooperative, or association. 17
(r) To give approval or consent to the articles of 18
incorporation submitted to the authority by a corporation seeking 19
approval as a nonprofit housing corporation, consumer housing 20
cooperative, limited dividend housing corporation, or mobile home 21
park corporation under chapter 4, 5, 6, or 8; to give approval or 22
consent to the partnership agreement, joint venture agreement, 23
trust agreement, or other document of basic organization of a 24
limited dividend housing association under chapter 7 or mobile home 25
park association under chapter 9. 26
(s) To engage the services of private consultants on a 27
contract basis for rendering professional and technical assistance 28
and advice. 29
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(t) To lease real or personal property and to accept federal 1
funds for, and participate in, federal programs of housing 2
assistance. 3
(u) To review and approve rental charges for authority-4
financed housing projects and require whatever changes the 5
authority determines to be necessary. The changes shall become are 6
effective after not less than 30 days' written notice is given to 7
the residents of the affected authority-financed housing projects. 8
(v) To set forth in the various loan documents of the 9
authority those restrictions on the sale, conveyance by land 10
contract, or transfer of residential real property, housing 11
projects, or housing units for which a note is held by the 12
authority and restrictions on the assumption by subsequent 13
purchasers of loans originated by and held by, or originated for 14
purchase by and held by, the authority as the authority determines 15
to be necessary in order to comply with requirements of federal 16
statutes, federal rules or regulations promulgated under 5 USC 551 17
to 559, state statutes, or state rules promulgated under the 18
administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 19
24.328, or to obtain and maintain the tax exempt status of 20
authority bonds and notes. However, the The authority shall not use 21
a due on sale or acceleration clause solely for the purpose of 22
renegotiating the interest rate on a loan made with respect to an 23
owner-occupied single-family housing unit. Without limiting the 24
authority's power to establish other restrictions, as provided in 25
this section, on the sale, conveyance by land contract, or transfer 26
of residential real property, housing projects, or housing units 27
for which a note is held by the authority and the assumption by 28
subsequent purchasers of loans made or purchased by the authority, 29
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the authority shall provide in its loan documents relating to a 1
single family loan that the single family loan may be assumed by a 2
new purchaser only when the new purchaser qualifies under the 3
authority income limitations rules, unless such a restriction 4
diminishes or precludes the insurance or a guarantee by an agency 5
of the federal government with respect to the single family loan. A 6
loan made for a mobile home that the borrower does not intend to 7
permanently affix to real property shall become is immediately due 8
and payable if the mobile home is moved out of the this state. Any 9
restrictions on conveyance by sale, conveyance by land contract, or 10
transfer that are authorized in this section shall apply only to 11
loans originated by and held by, or originated for purchase by and 12
held by, the authority and may, at the option of the authority, be 13
enforced by accelerating and declaring immediately due and payable 14
all sums evidenced by the note held by the authority. An 15
acceleration and declaration of all sums to be due and payable on 16
conveyance by sale, land contract, or transfer is not an 17
unreasonable restraint on alienation. An acceleration and 18
declaration, unless otherwise prohibited in this subdivision, of 19
all sums to be due and payable under this subdivision is 20
enforceable in any court of competent jurisdiction. This 21
subdivision is applicable to secured and unsecured loans. This 22
subdivision is also applicable to loan documents utilized in 23
conjunction with an authority-operated program of residential 24
rehabilitation by an entity cooperating or participating with the 25
authority under section 22a(4), if the loans are originated with 26
the intent to sell those loans to the authority. 27
(w) To set forth in the various loan documents of the 28
authority remedies for the making of a false statement, 29
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representation, or pretense or a material misstatement by a 1
borrower during the loan application process. Without limiting the 2
authority's power to pursue other remedies, the authority shall 3
provide in its loan documents that, if a borrower makes a false 4
statement, representation, or pretense or a material misstatement 5
during the loan application process, the authority, at its option, 6
may accelerate and declare immediately due and payable all sums 7
evidenced by the note held by the authority. An acceleration and 8
declaration of all sums to be due and payable as provided in this 9
subdivision is enforceable in any court of competent jurisdiction. 10
This subdivision is applicable to secured and unsecured loans. 11
(x) To collect interest on a real estate loan, the primary 12
security for which is not a first lien on real estate, at the rate 13
of 15% or less per annum on the unpaid balance. This subdivision 14
does not impair the validity of a transaction or rate of interest 15
that is lawful without regard to this subdivision. 16
(y) To encourage and engage or participate in programs to 17
accomplish the preservation of housing in this state available for 18
occupancy by persons and families of low or moderate income. 19
(z) To verify for the state treasurer statements submitted by 20
a city, village, township, or county as to exempt properties under 21
section 7d of the general property tax act, 1893 PA 206, MCL 22
211.7d. 23
(aa) For the purpose of more effectively managing its debt 24
service, to enter into an interest rate exchange or swap, hedge, or 25
similar agreement with respect to its bonds or notes on the terms 26
and payable from the sources and with the security, if any, as 27
determined by a resolution of the authority. 28
(bb) To make working capital loans to contractors or 29
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subcontractors on housing projects financed by the authority. The 1
authority shall submit an annual report to the legislature 2
containing the amount, recipient, duration, circumstance, and other 3
related statistics for each capital loan made to a contractor or 4
subcontractor under this subdivision. The authority shall include 5
in the report statistics related to the cost of improvements made 6
to adapt property for use by disabled individuals as provided in 7
section 32b or 44. 8
(cc) Subject to rules of the civil service commission, to 9
adopt a code of ethics with respect to its employees that requires 10
disclosure of financial interests, defines and precludes conflicts 11
of interest, and establishes reasonable post-employment 12
restrictions for a period of up to 1 year after an employee 13
terminates employment with the authority. 14
(dd) To impose covenants running with the land in order to 15
satisfy requirements of applicable federal law with respect to 16
housing assisted or to be assisted through federal programs such as 17
the low income housing tax credit program or the home investment 18
partnerships program. These covenants shall must be imposed by 19
executing and recording regulatory agreements between the 20
authority, or a municipality or other entity designated by the 21
authority, and the person or entity to be bound. The covenants 22
shall run with the land and be are effective with respect to the 23
parties making the covenants and other intended beneficiaries of 24
the covenants, even though there is no privity of estate or privity 25
of contract between the authority and the persons or entities to be 26
bound. 27
(ee) To impose covenants running with the land in order to 28
satisfy requirements of applicable state or federal law with 29
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respect to housing financed by the authority. These covenants shall 1
must be imposed by executing and recording regulatory agreements 2
between the authority and the person or entity to be bound. The 3
covenants shall run with the land and be are effective with respect 4
to the parties making the covenants and other intended 5
beneficiaries of the covenants, even though there is no privity of 6
estate or privity of contract between the authority and the persons 7
or entities to be bound. With respect to any applicable 8
environmental laws, this subdivision does not grant to the 9
authority any additional rights, privileges, or immunities not 10
otherwise afforded to a private lender that is not in the chain of 11
title for the land. 12
(ff) To participate in programs designed to assist persons and 13
families whose incomes do not exceed 115% of the greater of 14
statewide median gross income or the area median gross income 15
become homeowners where loans are made by private lenders for 16
purchase by the government national mortgage association, federal 17
national mortgage association, federal home loan mortgage 18
corporation, or other federally chartered organizations. 19
Participation may include providing or funding homeownership 20
counseling and providing some or all of a reserve fund to be used 21
to pay for losses in excess of insurance coverage. 22
(gg) To invest, under the conditions prescribed in this 23
subdivision and without the consent of the escrow depositors, up to 24
20% of funds held, by or for the authority, in escrow accounts for 25
the benefit of the authority or mortgagors of authority-financed 26
housing. The investments under this subdivision shall be made in 27
loans originated or purchased by the authority for construction or 28
rehabilitation of multifamily housing developments for occupancy by 29
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persons or families without regard to income. In connection with 1
loans described in this subdivision, the authority may charge and 2
retain fees in amounts similar to those charged with respect to 3
similar loans for which the source of funding does not come from 4
escrow accounts. For purposes of this subdivision, "escrow account" 5
means any account or reserve held by the authority and established 6
in a mortgage or a regulatory agreement to which the authority is a 7
party or which has been assigned to the authority. However, for For 8
purposes of this subdivision, escrow account does not include any 9
account labeled in the associated regulatory agreement as 10
"development cost escrow principal" or "operating assurance 11
reserve". For purposes of this subdivision, "multifamily housing 12
development" means a development in which not less than 50% of the 13
floor space is used primarily for residential purposes. The 14
investment authorized by this subdivision shall must not be made 15
unless both of the following requirements are met: 16
(i) The return on the loan is approximately equivalent to that 17
which could be obtained from investments of substantially similar 18
credit quality and maturity, as determined by the authority. 19
(ii) The authority agrees to pay with its own funds the 20
principal balance of any loan, made with the escrow funds, that 21
becomes delinquent in excess of 30 days. This subdivision does not 22
obligate the authority to purchase a delinquent loan so long as if 23
with respect to that loan the authority pays to the escrow funds 24
from its own funds the amount of the delinquent payments. The 25
authority's election to pay the delinquent payments to the escrow 26
funds does not in any manner abate or cure the delinquency of the 27
loan and the authority may resort to any remedies that would exist 28
in the absence of that payment. 29
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(hh) To acquire, develop, rehabilitate, own, operate, and 1
enter into contracts with respect to the management and operation 2
of real and personal property to use as office facilities by the 3
authority and to enter into leases with respect to facilities not 4
immediately necessary for the activities of the authority. 5
(ii) To make loans to certain qualified buyers and resident 6
organizations and to make grants to resident organizations as 7
provided in the following: 8
(i) The urban homestead act, 1999 PA 127, MCL 125.2701 to 9
125.2709. 10
(ii) The urban homesteading on vacant land act, 1999 PA 129, 11
MCL 125.2741 to 125.2748. 12
(iii) The urban homesteading in single-family public housing 13
act, 1999 PA 128, MCL 125.2761 to 125.2770. 14
(iv) The urban homesteading in multifamily public housing act, 15
1999 PA 84, MCL 125.2721 to 125.2734. 16
(jj) To implement and administer a housing and community 17
development program as described in this act. 18
(kk) To implement, administer, or execute administrative, 19
substantive, or supervisory powers pursuant to the individual or 20
family development account program act, 2006 PA 513, MCL 206.901 to 21
206.911. 22
(ll) To administer the resident ownership revolving fund 23
created under section 16d of the mobile home commission act, 1987 24
PA 96, MCL 125.2316d. 25
Enacting section 1. This amendatory act does not take effect 26
unless Senate Bill No. 934 of the 103rd Legislature is enacted into 27
law. 28