Tax increment financing; use of increment to convert vacant or underused commercial or industrial buildings to residential purposes authorized, and calculation of increment and findings required for a district converting vacant or underused property modified.

HF 2574 modifies Minnesota's tax increment financing (TIF) rules to allow redevelopment districts to use TIF funds specifically for converting vacant or underused commercial/industrial properties into residential buildings in Minneapolis or St. Paul. The bill changes how the "increment" (the increased tax revenue from new development) is calculated and requires districts to make specific findings about property conditions before conversion. It updates Minnesota Statutes sections 469.174, 469.175, and 469.177 to define qualifying properties and streamline the process for these conversions. This directly affects local redevelopment authorities and municipalities seeking to repurpose downtown or industrial areas for housing. The policy change aims to facilitate residential development on underutilized commercial sites through modified TIF funding mechanisms.