Local leadervs view a workforce housing tax credit bill proposed by a local senator as a key piece to solving the area’s workforce shortage.

Greater Minnesota Partnership Executive Director Dan Dorman said he supports the workforce housing package authored by District 27 Sen. Dan Sparks, DFL-Austin, last year that would allot $40 million over the next two years to a newly created office of workforce housing to fund housing projects across the state using grants and tax credits.

Sparks said he introduced a new workforce housing tax credit bill earlier this month that makes adjustments to the tax credit bill to help more cities in need of jumpstarting workforce housing projects.

The bill would incentivize investors and developers to build middle-income housing in Greater Minnesota communities where there is a shortage, he said. Under the proposal, investors would receive a 40 percent state tax credit for contributions made toward eligible workforce rental housing.

He said with the supplemental budget passed on Thursday, tax bills will start to get more attention. He noted he has a meeting with a group of advocates led by the Greater Minnesota Partnership to discuss the next steps.

Dorman said the bill would stimulate market-rate housing developments, such as Wedgewood Cove Townhomes.

He said a House workforce package that would transfer Minnesota Housing Finance Agency funds to Department of Employment and Economic Development is an “improvement,” to what is currently in place, but noted there are still limitations on how the funds could be used.

District 27A Rep. Peggy Bennett, R-Albert Lea, said she supports Sparks’ effort to address workforce housing, but noted she wished the Senate would have included a workforce housing package in their omnibus bill to show their desire to work together for Greater Minnesota.

She said she supports the House proposal, noting workforce housing is a critical issue for Greater Minnesota.

“It’s a big deal,” she said.

Albert Lea City Manager Chad Adams said he testified in support of Sparks’ bill earlier this month, noting workforce housing is one of Albert Lea’s biggest issues.

He said the bill would provide more tools for investors and developers to build workforce housing. He said developers have told him they face a significant gap in making projects profitable.

He noted he is hearing on a nearly daily basis from local Realtors, other people and businesses that they are having a hard time finding quality, affordable housing, noting he thinks Sparks’ bill is one way they should be able to close the gap in available workforce housing.