Bill Text: CA SB562 | 2011-2012 | Regular Session | Chaptered
Bill Title: Housing omnibus bill.
Spectrum: Slight Partisan Bill (Democrat 6-3)
Status: (Passed) 2011-09-06 - Chaptered by Secretary of State. Chapter 239, Statutes of 2011. [SB562 Detail]
Download: California-2011-SB562-Chaptered.html
BILL NUMBER: SB 562 CHAPTERED
BILL TEXT
CHAPTER 239
FILED WITH SECRETARY OF STATE SEPTEMBER 6, 2011
APPROVED BY GOVERNOR SEPTEMBER 6, 2011
PASSED THE SENATE AUGUST 22, 2011
PASSED THE ASSEMBLY AUGUST 18, 2011
AMENDED IN ASSEMBLY JUNE 20, 2011
AMENDED IN ASSEMBLY JUNE 13, 2011
AMENDED IN SENATE MARCH 29, 2011
INTRODUCED BY Committee on Transportation and Housing (Senators
DeSaulnier (Chair), Gaines, Harman, Huff, Kehoe, Lowenthal, Pavley,
Rubio, and Simitian)
FEBRUARY 17, 2011
An act to amend Section 8869.84 of the Government Code, to amend
Sections 18028, 18070.2, 18214, 18218, 18218.5, 18551, 18866.2,
33420.1, 50668.5, 50771.1, and 50893 of, and to repeal Section
33334.29 of, the Health and Safety Code, and to amend Section 2705
of, and to repeal Section 2706 of, the Public Resources Code,
relating to housing.
LEGISLATIVE COUNSEL'S DIGEST
SB 562, Committee on Transportation and Housing. Housing omnibus
bill.
(1) Existing law authorizes the California Debt Limit Allocation
Committee to require any issuer making an application to the
committee or the California Tax Credit Allocation Committee for
allocation of a portion of the state ceiling, as defined, to make a
deposit of up to 1% of the portion requested. If an allocation is
given, the committee is required to keep the deposit, in proportion
to the amount of allocation given, until bonds are issued. If bonds
are not issued prior to the expiration of the allocation, the
committee is required to keep the deposit, unless the committee
determines there is good cause to return all or part of the deposit.
This bill would specify that in cases where only a portion or none
of the bonds are issued, the committee may return all or part of the
deposit if it determines there is good cause to do so.
(2) Existing law establishes the Manufactured Home Recovery Fund,
which is continuously appropriated to make payments and distributions
for actual and direct losses, as defined, arising out of specified
transactions regarding the purchase or sale of a manufactured home,
if certain conditions are met. Existing law prescribes a fee
collected by the Department of Housing and Community Development for
each reported sale of a manufactured home, to be deposited in the
fund. Whenever the balance in the fund exceeds $1,000,000 the
department is authorized to reduce or increase the fee, respectively.
This bill would instead provide that the department may reduce the
fee when the balance exceeds $2,000,000.
(3) Existing law authorizes the redevelopment agency of the City
of Redding to borrow and use a specified amount from its Low and
Moderate Income Housing Fund to provide financial assistance for the
acquisition of property for a veterans home.
The bill would repeal this provision of law.
(4) Existing law authorizes the Department of Housing and
Community Development to extend the terms and repayment schedules of
loans for an additional 10 years, subject to specified conditions.
The bill would instead provide that the extension of terms be for
a period of not less than 10 years and that the total term of the
revised loan not exceed 55 years.
(5) Existing law requires a city and county to collect a fee from
each applicant for a building permit, equal to a specific amount of
the proposed construction for which the permit is being issued, or at
specified rates, for seismic hazards mapping and for the
strong-motion instrument program. The city and county is authorized
to retain up to 5% of the total amount it collects for data
utilization, for seismic education incorporating data interpretations
from data of the strong-motion instruments program, the seismic
hazards mapping program, and to improve the preparation for damage
assessment after strong seismic motion events. Any other funds
collected are required to be deposited in the Strong-Motion
Instrumentation and Seismic Hazards Mapping Fund to be used
exclusively for the strong-motion instruments program and the seismic
hazards mapping program, as specified.
This bill would make technical changes to those provisions.
(6) The bill would correct and eliminate erroneous
cross-references, update obsolete terms, correct technical errors,
and make conforming changes to existing law relating to housing.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 8869.84 of the Government Code is amended to
read:
8869.84. (a) The committee shall, as soon as is practicable after
the start of each calendar year, determine and announce the state
ceiling for the calendar year.
(b) The entire state ceiling for each calendar year is hereby
allocated to the committee to further allocate to state and local
agencies as provided in this chapter.
(c) The committee shall prepare application forms and announce
procedures for receipt and review of applications from state and
local agencies desiring to issue private activity bonds.
(d) The committee may at any time, before or after granting any
allocations in any calendar year to any state agencies or local
agencies, announce priorities or reservations of any part of the
state ceiling not theretofore allocated either for certain categories
of bonds or categories of issuers.
(e) The committee may require any issuer making an application to
the committee or MBTCAC for allocation of a portion of the state
ceiling to make a deposit, as determined by the committee, of up to 1
percent of the portion requested. If an allocation is not given, the
deposit shall be returned. If an allocation is given, the deposit
shall be kept, in proportion to the amount of allocation given, until
bonds are issued. Upon that issuance, the deposit shall be returned
to the issuer in an amount equal to the product of (1) the amount of
the deposit retained times (2) the ratio between the amount of bonds
issued divided by the amount of allocation granted. If no bonds are
issued prior to the expiration of the allocation, the deposit shall
be kept. However, in cases where only a portion or none of the bonds
are issued, the committee may return all or part of the deposit if it
determines there is good cause to do so. Any portion of a deposit
kept shall be deposited in the fund.
(f) The committee may transfer part of the state ceiling to the
MBTCAC, to be used for qualified mortgage bonds and exempt facility
bonds or for qualified residential rental projects, as those terms
are used in the Internal Revenue Code, together referred to as
"housing bonds," with directions and conditions pursuant to which
MBTCAC may allocate those amounts to issuers of housing bonds at both
the state and local levels. In carrying out these functions, MBTCAC
shall act solely as directed or authorized by the committee. If the
committee makes the transfer to MBTCAC authorized by this
subdivision, the references in Sections 8869.85, 8869.86, 8869.87,
and 8869.88 to the "committee" shall, for purposes of any housing
bonds, be deemed to mean MBTCAC.
(g) (1) The committee may establish the Extra Credit Teacher Home
Purchase Program to provide federal mortgage credit certificates and
reduced interest rate loans funded by mortgage revenue bonds to
eligible teachers, principals, vice principals, assistant principals,
and classified employees who agree to teach or provide
administration or service in a high priority school. Priority for
assistance shall be given to eligible teachers, principals, vice
principals, and assistant principals.
(2) For purposes of this program, the following definitions shall
apply:
(A) "High priority school" means a state K-12 public school that
is ranked in the bottom half of the Academic Performance Index
developed pursuant to subdivision (a) of Section 52052 of the
Education Code. However, priority shall be given to schools that are
ranked in the lowest three deciles.
(B) "Classified employee" means an employee of a school district,
employed in a position not requiring certification qualifications.
(3) The committee may make reservations of a portion of future
calendar year state ceiling limits for up to five future calendar
years for that program. The committee may also make future
allocations of the state ceiling for up to five years for any issuer
under that program. Any future allocation made by the committee shall
constitute an allocation of the state ceiling for a future year
specified by the committee and shall be deemed to have been made on
the first day of the future year so specified. The committee may
condition allocations under the Extra Credit Teacher Home Purchase
Program on any terms and conditions that the committee deems
necessary or appropriate, including, but not limited to, the
execution of a contract between the teacher, principal, vice
principal, assistant principal, or classified employee and the issuer
whereby the teacher, principal, vice principal, assistant principal,
or classified employee agrees to comply with the terms and
conditions of the program. The contract may include, among other
things, an agreement by the teacher, principal, vice principal,
assistant principal, or classified employee to teach or provide
administration or service in a high priority school for a minimum
number of years, and provisions for enforcing the contract that the
committee deems necessary or appropriate.
(4) If a teacher, principal, vice principal, assistant principal,
or classified employee does not fulfill the requirements of a
contract entered into pursuant to paragraph (3), the issuer of the
mortgage credit certificate or mortgage revenue bond may recover as
an assessment from the teacher, principal, vice principal, assistant
principal, or classified employee a monetary amount equal to the
lesser of (A) one-half of the teacher's, principal's, vice principal'
s, assistant principal's, or classified employee's net proceeds from
the sale of the related residence or (B) the amount of monetary
benefit conferred on the teacher, principal, vice principal,
assistant principal, or classified employee as a result of the
federal mortgage credit certificate or reduced interest rate loan
funded by a mortgage revenue bond, offset by the amount of any
federal recapture, as defined by Section 143(m) of the Internal
Revenue Code. The assessment may be secured by a lien against the
residence, which shall decline in amount over the term of the
contract as the teacher, principal, vice principal, assistant
principal, or classified employee fulfills the term of the contract,
and which shall be collected at the time of sale of the residence.
Any assessment collected pursuant to this paragraph shall be used for
the issuer's costs in administering the Extra Credit Teacher Home
Purchase Program. The issuers shall report annually to the committee
the total amount of any assessments collected pursuant to this
paragraph and how those assessments were used by the issuer.
(5) If the committee establishes the Extra Credit Teacher Home
Purchase Program pursuant to this subdivision, the committee shall
report annually to the Legislature the results of the program,
including all of the following:
(A) The amount of state ceiling limits allocated to or reserved
for the program.
(B) The agencies to which state ceiling limits were issued.
(C) The number of loans or mortgage credit certificates issued to
teachers, principals, vice principals, assistant principals, and
classified employees.
(D) The schools or school districts at which recipients of
assistance are employed, aggregated by decile in which the schools
rank on the Academic Performance Index and by the percentage of
uncredentialed teachers employed at the schools.
(6) The committee shall not make any reservations of future
calendar year state ceiling limits or future allocations of the state
ceiling pursuant to this subdivision on or after January 1, 2004,
unless a later enacted statute, that is enacted before January 1,
2004, deletes or extends that date. However, reservations and
allocations made prior to that date shall remain valid.
SEC. 2. Section 18028 of the Health and Safety Code is amended to
read:
18028. (a) The department may adopt regulations regarding the
construction of commercial modulars and special purpose commercial
modulars, other than mobile food facilities subject to Article 11
(commencing with Section 114250) of Chapter 4 of Part 7 of Division
104, and of multifamily manufactured homes, manufactured homes, and
mobilehomes that are not subject to the National Manufactured Housing
Construction and Safety Act of 1974 (42 U.S.C. Sec. 5401 et seq.)
that the department determines are reasonably necessary to protect
the health and safety of the occupants and the public.
(b) Requirements for the construction, alteration, or conversion
of commercial modulars shall be those contained, with reasonably
necessary additions or deletions, as adopted by department
regulations, in all of the following:
(1) The 1991 Edition of the Uniform Building Code, published by
the International Conference of Building Officials.
(2) The 1993 Edition of the National Electrical Code, published by
the National Fire Protection Association.
(3) The 1991 Edition of the Uniform Mechanical Code, published
jointly by the International Conference of Building Officials and the
International Association of Plumbing and Mechanical Officials.
(4) The 1991 Edition of the Uniform Plumbing Code, published by
the International Association of Plumbing and Mechanical Officials.
(c) (1) The department shall, on or after January 1, 2008, adopt
regulations for the construction, alteration, or conversion of
commercial modulars based on Parts 2, 3, 4, 5, 6, and 11 of the
California Building Standards Code, as contained in Title 24 of the
California Code of Regulations, with appropriate additions,
deletions, and other implementing provisions. The regulations adopted
under this paragraph shall be placed within Title 25 of the
California Code of Regulations.
(2) The requirements promulgated by the department pursuant to
this section shall apply only to the construction, alteration, and
conversion of commercial modulars, and not to the use or operation of
commercial modulars.
(d) A municipality shall not prohibit the use of commercial
modulars that bear a valid insignia, based on the date the insignia
was issued.
SEC. 3. Section 18070.2 of the Health and Safety Code is amended
to read:
18070.2. (a) Fees for the establishment and operation of the
Manufactured Home Recovery Fund shall be collected on or after
January 1, 1985. Claims against the fund arising from sales which
occur after January 1, 1985, may not be submitted to the department
before January 1, 1986. For purposes of this section, the date of
sale shall be either of the following:
(1) The date escrow closes for sales by dealers that are subject
to Section 18035 or 18035.2.
(2) For all other sales, including sales by dealers in which
escrow does not close, the date when the purchaser has paid the
purchase price or, in lieu thereof, has signed a security agreement,
option to purchase, or purchase contract and has taken physical
possession or delivery of the manufactured home.
(b) Notwithstanding any other provision of law, whenever the
balance in the Manufactured Home Recovery Fund exceeds two million
dollars ($2,000,000) on January 1 of any year, the department may
reduce the fee provided for in subdivision (c) of Section 18070.1.
The department may again increase the fee up to a maximum of ten
dollars ($10) whenever the balance in the fund falls below one
million dollars ($1,000,000).
SEC. 4. Section 18214 of the Health and Safety Code is amended to
read:
18214. (a) "Mobilehome park" is any area or tract of land where
two or more lots are rented or leased, held out for rent or lease, or
were formerly held out for rent or lease and later converted to a
subdivision, cooperative, condominium, or other form of resident
ownership, to accommodate manufactured homes, mobilehomes, or
recreational vehicles used for human habitation. The rental paid for
a manufactured home, a mobilehome, or a recreational vehicle shall be
deemed to include rental for the lot it occupies. This subdivision
shall not be construed to authorize the rental of a mobilehome park
space for the accommodation of a recreational vehicle in violation of
Section 798.22 of the Civil Code.
(b) Notwithstanding subdivision (a), employee housing that has
obtained a permit to operate pursuant to the Employee Housing Act
(Part 1 (commencing with Section 17000)) and that both meets the
criteria of Section 17021.6 and is comprised of two or more lots or
units held out for lease or rent or provided as a term or condition
of employment shall not be deemed a mobilehome park for the purposes
of the requirement to obtain an initial or annual permit to operate
or pay any related fees required by this part.
(c) Notwithstanding subdivision (a), an area or tract of land
shall not be deemed a mobilehome park if the structures on it consist
of residential structures that are rented or leased, or held out for
rent or lease, if those residential structures meet both of the
following requirements:
(1) The residential structures are manufactured homes constructed
pursuant to the National Manufactured Housing Construction and Safety
Act of 1974 (42 U.S.C. Sec. 5401 et seq.) or mobilehomes containing
two or more dwelling units for human habitation.
(2) Those manufactured homes or mobilehomes have been approved by
a city, county, or city and county pursuant to subdivision (e) of
Section 17951 as an alternate which is at least the equivalent to the
requirements prescribed in the California Building Standards Code or
Part 1.5 (commencing with Section 17910) in performance, safety, and
for the protection of life and health.
SEC. 5. Section 18218 of the Health and Safety Code is amended to
read:
18218. "Commercial modular" as used in this part has the same
meaning as defined in Section 18001.8.
SEC. 6. Section 18218.5 of the Health and Safety Code is amended
to read:
18218.5. "Special purpose commercial modular" as used in this
part has the same meaning as defined in Section 18012.5.
SEC. 7. Section 18551 of the Health and Safety Code is amended to
read:
18551. The department shall establish regulations for
manufactured home, mobilehome, and commercial modular foundation
systems that shall be applicable throughout the state. When
established, these regulations supersede any ordinance enacted by any
city, county, or city and county applicable to manufactured home,
mobilehome, and commercial modular foundation systems. The department
may approve alternate foundation systems to those provided by
regulation where the department is satisfied of equivalent
performance. The department shall document approval of alternate
systems by its stamp of approval on the plans and specifications for
the alternate foundation system. A manufactured home, mobilehome, or
commercial modular may be installed on a foundation system as either
a fixture or improvement to the real property, in accordance with
subdivision (a), or a manufactured home or mobilehome may be
installed on a foundation system as a chattel, in accordance with
subdivision (b).
(a) Installation of a manufactured home, mobilehome, or commercial
modular as a fixture or improvement to the real property shall
comply with all of the following:
(1) Prior to installation of a manufactured home, mobilehome, or
commercial modular on a foundation system, the manufactured home,
mobilehome, or commercial modular owner or a licensed contractor
shall obtain a building permit from the appropriate enforcement
agency. To obtain a permit, the owner or contractor shall provide the
following:
(A) Written evidence acceptable to the enforcement agency that the
manufactured home, mobilehome, or commercial modular owner owns,
holds title to, or is purchasing the real property where the
mobilehome is to be installed on a foundation system. A lease held by
the manufactured home, mobilehome, or commercial modular owner, that
is transferable, for the exclusive use of the real property where
the manufactured home, mobilehome, or commercial modular is to be
installed, shall be deemed to comply with this paragraph if the lease
is for a term of 35 years or more, or if less than 35 years, for a
term mutually agreed upon by the lessor and lessee, and the term of
the lease is not revocable at the discretion of the lessor except for
cause, as described in subdivisions 2 to 5, inclusive, of Section
1161 of the Code of Civil Procedure.
(B) Written evidence acceptable to the enforcement agency that the
registered owner owns the manufactured home, mobilehome, or
commercial modular free of any liens or encumbrances or, in the event
that the legal owner is not the registered owner, or liens and
encumbrances exist on the manufactured home, mobilehome, or
commercial modular, written evidence provided by the legal owner and
any lienors or encumbrancers that the legal owner, lienor, or
encumbrancer consents to the attachment of the manufactured home,
mobilehome, or commercial modular upon the discharge of any personal
lien, that may be conditioned upon the satisfaction by the registered
owner of the obligation secured by the lien.
(C) Plans and specifications required by department regulations or
a department-approved alternate for the manufactured home,
mobilehome, or commercial modular foundation system.
(D) The manufactured home, mobilehome, or commercial modular
manufacturer's installation instructions, or plans and specifications
signed by a California licensed architect or engineer covering the
installation of an individual manufactured home, mobilehome, or
commercial modular in the absence of the manufactured home,
mobilehome, or commercial modular manufacturer's instructions.
(E) Building permit fees established by ordinance or regulation of
the appropriate enforcement agency.
(F) A fee payable to the department in the amount of eleven
dollars ($11) for each transportable section of the manufactured
home, mobilehome, or commercial modular, that shall be transmitted to
the department at the time the certificate of occupancy is issued
with a copy of the building permit and any other information
concerning the manufactured home, mobilehome, or commercial modular
which the department may prescribe on forms provided by the
department.
(2) (A) On the same day that the certificate of occupancy for the
manufactured home, mobilehome, or commercial modular is issued by the
appropriate enforcement agency, the enforcement agency shall record
with the county recorder of the county where the real property is
situated, that the manufactured home, mobilehome, or commercial
modular has been installed upon, a document naming the owner of the
real property, describing the real property with certainty, and
stating that a manufactured home, mobilehome, or commercial modular
has been affixed to that real property by installation on a
foundation system pursuant to this subdivision.
(B) When recorded, the document referred to in subparagraph (A)
shall be indexed by the county recorder to the named owner and shall
be deemed to give constructive notice as to its contents to all
persons thereafter dealing with the real property.
(C) Fees received by the department pursuant to subparagraph (F)
of paragraph (1) shall be deposited in the Mobilehome-Manufactured
Home Revolving Fund established under subdivision (a) of Section
18016.5.
(3) The department shall adopt regulations providing for the
cancellation of registration of a manufactured home, mobilehome, or
commercial modular that is permanently attached to the ground on a
foundation system pursuant to subdivision (a). The regulations shall
provide for the surrender to the department of the certificate of
title and other indicia of registration. For the purposes of this
subdivision, permanent affixation to a foundation system shall be
deemed to have occurred on the day a certificate of occupancy is
issued to the manufactured home, mobilehome, or commercial modular
owner and the document referred to in subparagraph (A) of paragraph
(2) is recorded. Cancellation shall be effective as of that date and
the department shall enter the cancellation on its records upon
receipt of a copy of the certificate of occupancy. This subdivision
shall not be construed to affect the application of existing laws, or
the department's regulations or procedures with regard to the
cancellation of registration, except as to the requirement therefor
and the effective date thereof.
(4) Once installed on a foundation system in compliance with this
subdivision, a manufactured home, mobilehome, or commercial modular
shall be deemed a fixture and a real property improvement to the real
property to which it is affixed. Physical removal of the
manufactured home, mobilehome, or commercial modular shall thereafter
be prohibited without the consent of all persons or entities who, at
the time of removal, have title to any estate or interest in the
real property to which the manufactured home, mobilehome, or
commercial modular is affixed.
(5) For the purposes of this subdivision:
(A) "Physical removal" shall include, without limitation, the
unattaching of the manufactured home, mobilehome, or commercial
modular from the foundation system, except for temporary purposes of
repair or improvement thereto.
(B) Consent to removal shall not be required from the owners of
rights-of-way or easements or the owners of subsurface rights or
interests in or to minerals, including, but not limited to, oil, gas,
or other hydrocarbon substances.
(6) At least 30 days prior to a legal removal of the manufactured
home, mobilehome, or commercial modular from the foundation system
and transportation away from the real property to which it was
formerly affixed, the manufactured home, mobilehome, or commercial
modular owner shall notify the department and the county assessor of
the intended removal of the manufactured home, mobilehome, or
commercial modular. The department shall require written evidence
that the necessary consents have been obtained pursuant to this
section and shall require application for either a transportation
permit or manufactured home, mobilehome, or commercial modular
registration, as the department may decide is appropriate to the
circumstances. Immediately upon removal, as defined in this section,
the manufactured home, mobilehome, or commercial modular shall be
deemed to have become personal property and subject to all laws
governing the same as applicable to a manufactured home, mobilehome,
or commercial modular.
(b) The installation of a manufactured home or a mobilehome on a
foundation system as chattel shall be in accordance with Section
18613 and shall be deemed to meet or exceed the requirements of
Section 18613.4. This subdivision shall not be construed to affect
the application of sales and use or property taxes. No provisions of
this subdivision are intended, nor shall they be construed, to affect
the ownership interest of any owner of a manufactured home or
mobilehome.
(c) Once installed on a foundation system, a manufactured home,
mobilehome, or commercial modular shall be subject to state enforced
health and safety standards for manufactured homes, mobilehomes, or
commercial modulars enforced pursuant to Section 18020.
(d) No local agency shall require that any manufactured home,
mobilehome, or commercial modular currently on private property be
placed on a foundation system.
(e) No local agency shall require that any manufactured home or
mobilehome located in a mobilehome park be placed on a foundation
system.
(f) No local agency shall require, as a condition for the approval
of the conversion of a rental mobilehome park to a resident-owned
park, including, but not limited to, a subdivision, cooperative, or
condominium for mobilehomes, that any manufactured home or mobilehome
located there be placed on a foundation system. This subdivision
shall only apply to the conversion of a rental mobilehome park that
has been operated as a rental mobilehome park for a minimum period of
five years.
SEC. 8. Section 18866.2 of the Health and Safety Code is amended
to read:
18866.2. Any notice of violation of this part, or any rule or
regulation adopted pursuant thereto, issued by the enforcement agency
shall be issued to the appropriate persons designated in Section
18867 and shall include a statement that any willful violation is a
misdemeanor under Section 18874.
SEC. 9. Section 33334.29 of the Health and Safety Code is
repealed.
SEC. 10. Section 33420.1 of the Health and Safety Code is amended
to read:
33420.1. Within a project area, for any project undertaken by an
agency for building rehabilitation or alteration in construction, an
agency may take those actions which the agency determines necessary
and which is consistent with local, state, and federal law, to
provide for seismic retrofits as follows:
(a) For unreinforced masonry buildings, to meet the requirements
of Appendix Chapter A1 of the current California Existing Building
Code (Part 10 of Title 24 of the California Code of Regulations).
(b) For any buildings that qualify as "historical property" under
Section 37602, to meet the requirements of the State Historical
Building Code (Part 2.7 (commencing with Section 18950) of Division
13) and the current California Historical Building Code (Part 8 of
Title 24 of the California Code of Regulations).
(c) For buildings other than unreinforced masonry buildings and
historical properties, to meet the requirements of Appendix A:
Guidelines for the Seismic Retrofit of Existing Buildings of the
International Existing Building Code unless superseding building
standards for existing buildings are adopted in the California
Building Code (Part 2 of Title 24 of the California Code of
Regulations).
If an agency undertakes seismic retrofits and proposes to add new
territory to the project area, to increase either the limitation on
the number of dollars to be allocated to the redevelopment agency or
the time limit on the establishing of loans, advances, and
indebtedness established pursuant to paragraphs (1) and (2) of
Section 33333.2, to lengthen the period during which the
redevelopment plan is effective, to merge project areas, or to add
significant additional capital improvement projects, as determined by
the agency, the agency shall amend its redevelopment plan and follow
the same procedure, and the legislative body is subject to the same
restrictions, as provided for in Article 4 (commencing with Section
33330) for the adoption of a plan.
SEC. 11. Section 50668.5 of the Health and Safety Code is amended
to read:
50668.5. For the purpose of providing financial assistance
pursuant to this chapter utilizing bond proceeds transferred to the
Housing Rehabilitation Loan Fund pursuant to paragraph (2) of
subdivision (a) of Section 53130, paragraph (2) of subdivision (b) of
Section 53130, and Sections 8878.20 and
8878.21 of the Government Code, deferred payment
loans made with these funds shall be subject to all of the following
special provisions, which shall prevail over conflicting provisions
of this chapter:
(a) (1) Applications for fund commitments shall be accepted by
the department at any time. Fund commitments shall be based on a
ranking of applications, which shall occur at least once every three
months until there are insufficient funds available to commit
according to this ranking. In making this ranking for rental housing
developments, priority shall be given to those projects which (A)
serve the greater number of eligible households as defined in Section
50105 with the lowest incomes, (B) provide the greater number of
units with three or more bedrooms, (C) are located in areas where the
housing need is great as determined by the department, taking into
consideration, among other factors, low vacancy rates, high market
rents, long waiting lists for subsidized housing, the stock of
substandard housing, and the potential loss of subsidized rental
housing to market-rate housing through demolition, foreclosure, or
subsidy termination, (D) complement the implementation of an existing
housing program, (E) maximize private, local, and other funding
sources, and (F) maximize long-term benefits for eligible households,
as defined in Sections 50079.5 and 50105. Subparagraph (B) above
shall not apply to applications for fund commitments submitted
pursuant to Section 50670 or to any application for residential
hotels and motels. In making this ranking for owner-occupied housing,
priority shall be given to those applications which (A) serve the
greater number of eligible households, as defined in Section 50105,
with the lowest income, (B) provide the greater number of units with
three or more bedrooms, (C) are located in areas where the need for
rehabilitation is great as determined by the department, taking into
consideration, among other factors, the amount of substandard
owner-occupied housing, low vacancy rates, and limited availability
of affordable housing, (D) complement the implementation of an
existing housing program, and (E) maximize available and appropriate
private, local, and other funding sources. The department shall also
evaluate the capability of the sponsor to rehabilitate, own, and
manage the rental housing development or the capability of the
applicant for funding for owner-occupied housing to implement the
proposed program.
(2) Loans for rental housing developments may be reviewed,
approved, and funded by the department directly to the sponsor. In
these cases, the department shall ensure that the sponsor notifies
the local legislative body of the sponsor's loan application prior to
a funding award. Loans to owner-occupants may be made by local
public entities or nonprofit corporations which have received fund
commitments from the department. The department shall ensure that the
local public entity or nonprofit corporation applying for fund
commitments for loans to owner-occupants notifies the local
legislative body of the application prior to a funding award. When
the department certifies a local public entity or nonprofit
corporation as being capable of making these loans, the department
shall delegate responsibility for reviewing and approving these loans
to the local public entity or nonprofit corporation. If it is
determined by the department that the local public entity or
nonprofit corporation is no longer capable of making or managing
these loans, the department may, at its sole discretion, revoke that
delegation of responsibility or cancel the funding commitment to the
local public entity or nonprofit corporation, or both. The department'
s regulations shall include procedures and standards for
certification and decertification.
(3) A sponsor may apply for loans for one or more rental housing
developments.
(b) (1) A housing development may utilize any combination of
federal, state, local, and private financial resources necessary to
make the development affordable, for the term of the state's
regulatory agreement, to the eligible households. Notwithstanding the
requirements of Section 50663, rental housing developments and
owner-occupied units assisted by the program may be located anywhere
in the state.
(2) In the case of loans for rental housing developments awarded
to nonprofit sponsors, the total secured debt in a superior position
to the department's loan, plus the department's loan, shall not
exceed 100 percent of the after rehabilitation value of the property,
as determined by an appraisal of the property conducted pursuant to
guidelines established in regulations of the department.
(3) The maximum loan amounts per unit established in regulations
pursuant to Section 50670 shall also apply to rental housing
developments rehabilitated or acquired and rehabilitated pursuant to
paragraph (1) of subdivision (a) of Section 50661, except that there
shall not be a maximum loan amount established per project. These
dollar limitations may be increased by the department, as necessary,
in high-cost areas of the state or where the correction of severe
health and safety defects or the provisions of handicapped
accessibility standards necessitate greater assistance. The
department, by regulation, may specify unit loan limits for loans
made for owner-occupied housing and the circumstances under which it
may grant exceptions to, or variances from, these limits.
(4) (A) Loans made to sponsors of rental housing developments for
acquisition and rehabilitation shall be for terms of not less than 30
years. Loans made to sponsors of rental housing developments for
rehabilitation only shall be for terms of not less than 20 years.
However, the term shall not exceed the useful life of the rental
housing development for which the loan is made. The sponsor may elect
to begin to repay the loan at any time in accordance with the
prepayment plan established in accordance with paragraph (6), if it
is determined by the department, that the sponsors can continue to
maintain the rents at levels affordable to eligible households.
(B) The term of the loan and the time for repayment may be
extended by the department for additional terms as long as the rental
housing development is operated in a manner consistent with the
regulatory agreement and the sponsor requires an extension in order
to continue to operate in a manner consistent with this chapter. Each
extension shall be for a period of not less than 10 years and the
total term of the revised loan shall not exceed 55 years.
(5) (A) In the case of loans made for rental housing developments,
eligible costs shall include those costs relating to (i) real
property acquisition, including refinancing of existing debt to the
extent necessary to reduce debt service to a level consistent with
the provision of affordable rents and the fiscal integrity of the
project; (ii) rehabilitation or reconstruction, including the
conversion of nonresidential structures to residential use; (iii)
general property improvements which are necessary to correct unsafe,
unhealthy, or unsanitary conditions, including renovations and
remodeling, including, but not limited to, remodeling of kitchens and
bathrooms, installation of new appliances, landscaping, and purchase
or installation of central air conditioning; (iv) necessary and
related onsite improvements; (v) reasonable administrative expenses
in connection with the planning and execution of the project, as
determined by the department; (vi) reasonable consulting costs; (vii)
rent-up costs; (viii) seismic rehabilitation improvements; and (ix)
any other costs of rehabilitation authorized by the department.
"Rent-up costs," as used in this section, means costs incurred while
a unit is on the housing market but not rented to its first tenant.
"Seismic rehabilitation improvements," as used in this section, means
improvements which are designed to increase seismic structural
safety in accordance with a plan developed by a civil engineer, a
structural engineer, or an architect for a particular building that
has been identified as hazardous by the city or county in which the
building is located in accordance with the criteria established by
the Seismic Safety Commission pursuant to Section 8875.1 of the
Government Code or in accordance with a previously adopted city or
county seismic safety ordinance adopted pursuant to Section 19163.
(B) In the case of loans made for owner-occupied housing, eligible
costs shall include those costs relating to (i) rehabilitation work
expenses; (ii) cost of room additions necessary to alleviate
overcrowding; (iii) costs of general property improvements including
renovations and remodeling, including, but not limited to, remodeling
of kitchens and bathrooms, installation of new appliances,
landscaping and purchase or installation of central air conditioning,
to the extent that they are necessary to correct unsafe, unhealthy,
or unsanitary conditions; (iv) costs related to necessary
architectural, engineering, and other technical consultants; (v)
costs of preliminary reports, title policies, credit reports,
appraisal reports, and fees for recording documents related to the
department's loans; (vi) costs of building permits and other
governmental fees; and (vii) if in conjunction with other
rehabilitation work, costs for improvements related to making the
housing accessible to the handicapped.
(C) Notwithstanding the provisions of Section 53130 which limit
the use of allocated proceeds with respect to project operating
costs, and Sections 53131 and 53133, the department may set aside or
use any amounts available in the fund to establish a rental housing
development default reserve for the purpose of curing or avoiding a
sponsor's defaults on the terms of any loan or other obligation which
jeopardizes the financial integrity of a rental housing development
or the department's security in the rental housing development. The
payment or advance of funds by the department pursuant to this
subparagraph shall be solely within the discretion of the department
and no sponsor shall be entitled to or have any right to payment of
these funds. Funds advanced pursuant to this subparagraph shall be
added to the loan amount secured by the deed of trust and shall be
payable to the department upon demand.
(D) Notwithstanding the provisions of Section 53130 which limit
the use of allocated proceeds with respect to project operating
costs, or Sections 53131 and 53133, the department may set aside or
use proceeds in the fund in an amount not to exceed 3 percent of the
amount of encumbrances for loans for owner-occupied housing to
establish an owner-occupied housing default reserve for the purpose
of curing or avoiding an owner's default on the terms of any loan or
other obligation which jeopardizes the department's security in the
owner-occupied housing. The payment or advance of funds by the
department pursuant to this subparagraph shall be solely within the
discretion of the department, and no homeowner shall be entitled to,
or have any right to payment of, these funds. Funds advanced pursuant
to this subparagraph shall be added to the loan amount secured by
the deed of trust and shall be payable to the department upon demand.
Interest payments from loans for owner-occupied housing shall be
allocated by the department into this reserve to replace the
allocated proceeds until the percent established by the department is
achieved solely with interest payments.
(6) Upon request of the sponsor, the department may permit
repayment of a sponsor's loan on the basis of net cashflow. The
department shall develop a prepayment plan in conjunction with the
sponsor which will ensure the maintenance of affordable rents and the
fiscal integrity of the rental housing development. As an incentive
to encourage the prepayment of loans, the department may permit the
sponsor to retain one-half of the net cashflow. The department shall
determine the method for calculating net cashflow, which may include
a factor for excess debt service coverage or a return on cash
investment to the sponsor.
(7) If a loan is made pursuant to this chapter for both seismic
rehabilitation improvements and other eligible rehabilitation costs,
only those costs related to the seismic rehabilitation improvements
shall be counted and included for purposes of the fund reservation
made by Section 8878.20 of the Government Code.
(c) Principal and accumulated interest is due and payable upon
completion of the term of the loan. The loan shall bear interest at
the rate of 3 percent per annum on the unpaid principal balance.
However, the department shall reduce or eliminate interest payments
on a loan for any year or, alternatively, defer interest until the
deferred payment loan is repaid, if necessary to provide affordable
rents to households of very low and low income. The ability to pay
all or part of the 3 percent simple annual interest shall not be
considered in determining the fiscal integrity of the rental housing
development at the time of the rating and ranking of an application.
(1) "Maintain affordable rent levels," as used in this section,
means rents may be automatically increased by the sponsor on an
annual basis pursuant to an inflation index to be determined by the
department. The inflation index shall reflect anticipated annual
changes in rental housing development operating costs from a base
year when the rents are initially established. Any sponsor may appeal
to the department for a greater adjustment in rents necessary to
ensure the fiscal integrity of the rental housing development. If the
department does not respond within 60 days, the request shall be
deemed approved. A 30-day written notice shall be given to each
eligible household prior to an adjustment in the amount of rent.
(2) (A) Upon prior written approval by the department, a sponsor
may set income limits for incoming tenants at a level below the limit
specified in Section 50079.5. If a tenant's income exceeds this
income limit established by the sponsor, but does not exceed the
limit specified in Section 50079.5, that fact alone shall neither
constitute cause for the tenant's eviction, nor be a violation of the
sponsor's loan agreement. If a tenant's income exceeds the income
limit for a household specified in Section 50079.5, the tenant shall
be required to vacate the assisted unit within six months from the
date of income recertification or notice to the sponsor of an
increase in income over the permissible income level. That period may
be extended by the sponsor for an additional six-month period in
high cost rental areas with low vacancy rates, as determined by the
department. Any vacant units shall be rented to eligible households
until the required residency by eligible households is attained.
(B) In the case of limited equity housing cooperatives, the
provisions of this paragraph shall apply, except that tenants whose
incomes, upon recertification, exceed the limit specified in Section
50079.5 shall not be required to vacate their units. Instead, and
upon six months' notice, these tenants shall be required to pay rent
in an amount equal to the market rate rent for comparable units, as
determined by the department. When a tenant's income exceeds the
limit specified in Section 50079.5, the next available membership
share for occupancy in a comparable unit shall be sold to a household
with an income at or below this limit.
(3) When operating income as defined by the department is greater
than operating expenses, debt service, deposits required for reserve
accounts, payments pursuant to paragraph (6) of subdivision (b) if
elected by the sponsor, approved annual distributions, and any other
disbursements approved by the department, these excess funds shall be
paid into an account established in the fund. Funds in this account
shall be appropriated to the department for use to assist rental
housing developments funded pursuant to this section with proceeds of
bonds issued pursuant to Chapter 27 of the Statutes of 1988, Chapter
30 of the Statutes of 1988, or Chapter 48 of the Statutes of 1988,
subject to the following requirements:
(i) Excess funds in the account shall be allocated first into the
rental housing development default reserve established pursuant to
subparagraph (C) of paragraph (5) of subdivision (b). The balance of
this default reserve shall not exceed the maximum level of funding
established by regulations adopted by the department.
(ii) After the rental housing development default reserve is fully
funded with these excess funds, the department shall use all
additional excess funds in the account for payment of either
unforeseen capital improvements, the cost of which would jeopardize
the fiscal integrity and affordability of a rental housing
development, or to further reduce rents in a rental housing
development. The department may adopt regulations which specify the
procedures and standards for application for, and use of, these
funds. Those payments used for capital improvements shall be added to
the loan amount secured by the deed of trust and shall be payable to
the department upon demand.
(d) Prior to disbursement of any funds for loans to rental housing
developments made pursuant to this section, the department shall
enter into a regulatory agreement with the sponsor in accordance with
subdivision (d) of Section 50670, except that (1) the term of the
regulatory agreement shall be for the original term of the loan and
the agreement shall be binding upon the sponsor and successors in
interest upon sale or transfer of the rental housing development or
prepayment of the loan and (2) a nonprofit sponsor, other than a
governmental agency, may maintain a debt service coverage ratio of
115 percent and distribute earnings in an amount no greater than 8
percent of the nonprofit sponsor's actual investment. The regulatory
agreement also shall contain provisions requiring annual inspections
and review of year-end fiscal audits and related reports by the
department and provisions to maintain affordable rent levels to serve
eligible households.
(e) Where loans will be used in conjunction with federal or other
housing assistance or tax credits and a conflict exists between the
other state or federal program requirements and those of this chapter
with respect to the calculation of rents, the requirements of the
Deferred Payment Rehabilitation Loan Program and the Special User
Housing Rehabilitation Program may be waived only to the extent
necessary to permit federal or other state financial participation or
eligibility for tax credits.
(f) "Sponsor," for purposes of this section, has the same meaning
as defined in subdivision (c) of Section 50669.
(g) (1) The department shall adopt emergency regulations to
implement this chapter and to amend the maximum loan amounts per unit
established in regulations adopted pursuant to Section 50670, with
respect to loans made with funding subject to this section. The
regulations shall be conclusively presumed to be necessary for the
immediate preservation of the public peace, health, safety, or
general welfare within the meaning or purposes of Section 11346.1 of
the Government Code.
(2) Notwithstanding conflicting provisions of this chapter, the
department may elect to make the regulations referred to in paragraph
(1) additionally applicable until December 31, 1993, to all other
deferred payment loan programs authorized by this chapter, except the
programs specified in Sections 50662.5 and 50671, if the department
determines that the uniformity achieved thereby will avoid
significant additional administrative costs.
(h) For purposes of this section, "rental housing development"
means a single family house or a multifamily structure or structures
containing two or more dwelling units, including efficiency units.
One or more of the dwelling units in a rental housing development
shall be rented or leased or otherwise occupied as a primary
residence by a person or household who is not the owner of the
structure or structures. For the purposes of this section, motels
operated pursuant to subdivision (b) of Section 50669, residential
hotels, group or congregate homes, and limited equity housing
cooperatives are rental housing developments. Except for motels, the
limitations concerning types of residents and minimum number of units
set forth in subdivision (b) of Section 50669 shall not apply.
(i) "Affordable rent" for the purposes of this section shall be
established by the department in the regulations authorized by
subdivision (g). However, the initial rents shall be established by
the department based on a designated family size for each unit size,
and those initial rents shall not exceed 30 percent of 50 percent of
the area median income adjusted by that designated family size for
units restricted to occupancy by very low income households; or 30
percent of 60 percent of area median income adjusted by that
designated family size for units restricted to occupancy by
low-income households. In establishing affordable rent levels, the
department shall make provision in its regulations for projects
serving the physically and mentally handicapped persons.
SEC. 12. Section 50771.1 of the Health and Safety Code is amended
to read:
50771.1. For the purpose of providing deferred payment loans
pursuant to this chapter for the development costs of rental housing
developments utilizing moneys transferred to the Rental Housing
Construction Fund pursuant to paragraph (1) of subdivision (a) of
Section 53130 and paragraph (1) of subdivision (b) of Section 53130,
the following special provisions shall prevail over conflicting
provisions of this chapter:
(a) (1) Applications for fund commitments shall be accepted by the
department at any time. Fund commitments shall be based on a ranking
of applications which shall occur at least once every three months
until there are insufficient funds available to make commitments
according to the ranking. In making this ranking, notwithstanding
Sections 50737 and 50737.5, priority shall be given to projects which
(A) maximize program benefits to eligible households, as defined in
Section 50105 with the lowest incomes, (B) maximize program benefits
to eligible households needing assisted units with three or more
bedrooms, (C) are located in areas where the housing need is great,
as determined by the department, taking into consideration, among
other factors, variations in local development costs, low vacancy
rates, high market rents, and long waiting lists for subsidized
housing, (D) complement the implementation of an existing housing
program, (E) maximize private, local, and other funding sources, (F)
are economically feasible given local market conditions, and (G)
maximize the number of units which can be assisted under the program,
relative to variances in market conditions for the development of
rental housing. Subparagraph (B) above does not apply to applications
for residential hotels.
(2) All loans shall be made directly from the department to the
housing sponsor which applies to the department and will own,
operate, and develop the housing development. The sponsor shall
notify the local legislative body of its loan application prior to
the funding award.
(3) A sponsor may apply for awards for one or more rental housing
developments.
(4) The department shall evaluate the capability of the sponsor to
own, construct, and manage the rental housing development.
(b) (1) A rental housing development may utilize any combination
of federal, state, local, and private financial resources necessary
to make the development affordable, for the term of the state's
regulatory agreement, to eligible households.
(2) (A) Loans to sponsors of housing developments shall be for a
term not less than 40 years. After 30 years from the time the loan is
made, the sponsor shall begin to repay the loan in accordance with a
payment plan, as determined by the department, that will maintain
the rents affordable to eligible households.
(B) The term of the loan and the time for repayment may be
extended by the department for additional terms as long as the rental
housing development is operated in a manner consistent with the
regulatory agreement and the sponsor requires an extension in order
to continue to operate in a manner consistent with this chapter. Each
extension shall be for a period of not less than 10 years and the
total term of the revised loan shall not exceed 55 years.
(C) Loans provided under this section shall bear an interest rate
of 3 percent per annum. The department, by regulations, shall
establish the conditions under which the interest may be reduced,
waived, or deferred. At the request of the sponsor, the department
may charge a higher interest rate.
(3) (A) Development costs shall include reasonable consulting
fees, and other reasonable administrative expenses in connection with
the planning and execution of the rental housing development, as
determined by the department, and initial funding of emergency
reserves, as required by the department. The development costs also
shall further include the acquisition and completion of construction
of a rental housing development where construction has halted due to
financial distress, as determined by the department.
(B) A rental housing development shall include residential hotels,
as defined in subdivision (b) of Section 50669, and group homes.
(4) The sponsor shall maintain an emergency reserve to defray
unanticipated cost increases or revenue shortfalls to maintain the
fiscal integrity of the rental housing development and maintain
affordable rents for eligible households.
(5) The department, by regulation, shall specify minimum equity
requirements not to exceed 10 percent of total project development
costs. This requirement does not apply to proposed projects where
assisted units are less than 80 percent of the total number of units.
The department, by regulation, shall define "equity" for the
purposes of this section, which shall include, but shall not be
limited to, cash, real property, items of personal property having
monetary value contributed by the sponsor and applied toward project
costs, and the capitalized value of any exemption from local taxes on
real property.
(6) The department, by regulation, may specify per-unit loan
limits and circumstances under which it may grant exceptions to, or
variances from, these limits. The loan amount shall not exceed either
100 percent of the development costs attributable to the assisted
units or the amount necessary to maintain affordable rents for the
assisted units, as determined by the department.
(c) (1) Initial rents, including a reasonable utility
allowance, for assisted units reserved for occupancy by very low
income households, and for all assisted units in residential hotels
and group homes, shall not exceed 30 percent of 35 percent of area
median income, adjusted by unit size. Initial rents, including a
reasonable utility allowance, for assisted units reserved for
occupancy by lower income households shall not exceed 30 percent of
60 percent of area median income, adjusted by unit size. The
department, by regulation, shall specify the method for adjusting
rents by unit size and for computing allowances for utility costs.
(2) The department shall develop an inflation index reflecting the
annual anticipated changes in rental housing development operating
costs from a base year. The inflation index shall be used by the
sponsor to adjust the initial rent of each unit occupied by an
eligible household to determine the annual rent. Any sponsor may
appeal to the department for a greater adjustment in rents necessary
to ensure the fiscal integrity of the housing development. If the
department does not respond within 60 days, the request shall be
deemed approved. A 30-day written notice shall be given to each
eligible household prior to an adjustment in the amount of rent.
(3) Upon prior written approval by the department, a sponsor may
set income limits for occupancy of assisted units designated for
lower income households at a level below the limit specified in
Section 50079.5. If a tenant's income exceeds this income limit
established by the sponsor, but does not exceed the limit specified
in Section 50079.5, that fact alone shall neither constitute cause
for the tenant's eviction, nor be a violation of the sponsor's loan
agreement.
(4) The monthly rent including a reasonable utility allowance may
be reduced by the sponsor, to make the units affordable to the lowest
income household possible as long as the project remains
economically feasible.
(5) (A) If a household's income exceeds the standard pursuant to
which it was accepted for tenancy, that fact alone shall neither
constitute cause for the household's immediate eviction nor be a
violation of the owner's or sponsor's loan agreement.
(B) If, after annual income certification, an assisted unit
becomes occupied by a household which does not meet the income limits
specified in Section 50105, that household shall be permitted to
continue to occupy that assisted unit. When there is a vacancy in an
assisted unit formerly occupied by a household which meets the income
limits specified in Section 50079.5, that unit shall be rented to a
household which meets the income limits specified in Section 50105.
(C) If, after annual income certification, an assisted unit
becomes occupied by a household which does not meet the income limits
specified in Section 50079.5, that household shall be provided a
six-month notice of termination. That period may be extended for an
additional six-month period in high cost rental areas with low
vacancy rates, as determined by the department. That household shall
have first right of refusal to occupy any nonassisted unit which
becomes available during both periods.
(D) In the case of limited equity housing cooperatives, the
provisions of subparagraph (C) shall apply, except that tenants whose
incomes, upon recertification, exceed the limit specified in Section
50079.5 shall not be required to vacate their units. Instead, and
upon six months' notice, these tenants shall be required to pay rent
in an amount equal to the market rate rent for comparable units, as
determined by the department. When a tenant's income exceeds the
limit specified in Section 50079.5, the next available membership
share for occupancy in a comparable unit shall be sold to a household
with an income at or below this limit.
(d) (1) The department may contract with the sponsor to pay all or
a portion of the development costs incurred in connection with the
construction of a rental housing development consistent with the
requirements of this article. The department shall include such
provisions in the contract as are necessary to ensure compliance with
the requirements of the program.
Any rental housing development assisted pursuant to this article
shall be governed by a regulatory agreement between the sponsor and
the department. The regulatory agreement shall be recorded or
referenced in a recorded document in the office of the county
recorder for the county in which the rental housing development is
located. The regulatory agreement shall contain at least all of the
following:
(A) Restrictions on occupancy of dwelling units within the rental
housing development, to meet the requirements of Section 50736 and
this section for a period of at least 40 years.
(B) Provisions governing standards for tenant selection to ensure
occupancy by eligible households of very low and low income for the
term of the regulatory agreement.
(C) Provisions governing occupancy standards and rental
agreements.
(D) Provisions for setting initial rents and rent increases
consistent with paragraph (1) of subdivision (c) of Section 50771.1.
Prior to the time any rent increase is effective, the sponsor shall
notify every affected tenant, in writing, of the availability of
informal meetings with the sponsor to review the proposed rent
increase. Each tenant, upon request, shall be provided the
information submitted to the department pursuant to this subdivision.
(E) A requirement that the sponsor submit to the department for
review and approval, annual operating budgets and periodic reports,
which shall at a minimum include information on the fiscal condition
of the rental housing development, the maintenance of the
development, and the number of units occupied by eligible households.
(F) Provisions limiting distribution of sponsor's earnings as
specified in paragraph (4).
(G) A provision which specifies the conditions under which the
department and any intended beneficiary may enforce the regulatory
agreement.
(H) Any other provisions necessary to carry out the purposes and
to exercise the powers granted by this chapter.
The regulatory agreement shall be recorded against the property
and shall be deemed a covenant running with the land and shall be
binding upon the sponsor and any and all successors in interest in
case of sale or transfer of the rental housing development for the
original term of the loan, and any extensions thereof, regardless of
any prepayment of the loan.
The department, by regulation, may require such other documents,
instruments, and agreements as are reasonable and necessary to ensure
compliance with the program requirements.
(2) The contract for the award of development funds to be provided
as construction financing for a rental housing development shall
contain at a minimum the provisions specified in Section 50766,
excluding therefor subdivisions (j), (k), and ( l ).
(3) All state contracts and regulatory or development agreements
subject to this article shall contain provisions requiring that
assisted units remain affordable to eligible households for 40 years
plus any permitted extension.
(4) A nonprofit sponsor, other than a governmental agency, may
maintain a debt service coverage ratio of not more than 115 percent
and distribute earnings from both assisted and nonassisted units in
an amount no greater than 8 percent of the nonprofit sponsor's actual
investment in the rental housing development. A for-profit sponsor
may choose between the following options:
(A) It may distribute earnings from both assisted and nonassisted
units in an annual amount no greater than 8 percent of its actual
investment in the rental housing development.
(B) It may forego distribution of earnings from assisted units,
and not be subject to any limitation on the amount of distributions
it receives from nonassisted units.
(e) Where loans will be used in conjunction with federal and other
state housing assistance or tax credit and a conflict exists between
the other state and federal program requirements and this chapter
regarding the test for determining a qualified low-income housing
project, the requirements of the Rental Housing Construction Program
may be waived only to the extent necessary to permit the federal or
other state financial participation or eligibility for tax credits.
(f) (1) The department shall establish specific minimum
development criteria to (A) ensure that the useful life of the rental
housing development is at least equal to the term of the loan; (B)
enhance the physical security of the tenants; (C) minimize long-term
operating and maintenance costs; and (D) ensure that project design
features and amenities are modest.
(2) No energy standards shall be required of any housing
development in excess of the energy standards required for housing
developments financed by conventional funding sources.
(3) The department shall employ a licensed architect or an
experienced building inspector, or both, to review plans, inspect,
and monitor construction of, rental housing developments.
(g) A sponsor of a housing development may receive payments from
the annuity fund pursuant to Section 50738 to the extent that there
are unobligated moneys available in the fund.
(h) The department shall establish an emergency reserve account in
the Rental Housing Construction Fund established pursuant to Section
50740 equal to 3 percent of the moneys transferred to that fund
pursuant to Section 53130.
Moneys transferred to the fund pursuant to Section 53130 shall not
be subject to the requirements of Section 50770 or be used to ensure
economic feasibility or enable construction pursuant to Section
50738. Notwithstanding the provisions of Sections 53130 and 53133,
the department may expend moneys in the account to defray
unanticipated cost increases or revenue shortfalls not covered by a
rental housing development emergency reserve to the extent necessary
to maintain the fiscal integrity of a rental housing development and
maintain affordable rents for eligible households.
Notwithstanding the provisions of Section 53130 which limit the
use of allocated proceeds with respect to project operating costs,
and Section 53133, the department may use any amounts available in
the account for the purpose of curing or avoiding a sponsor's
defaults on the terms of any loan or other obligation which will
jeopardize the financial integrity of a rental housing development or
the department's security in the rental housing development. The
payment or advance of any funds by the department pursuant to this
subdivision shall be solely within the discretion of the department,
and no sponsor shall be entitled to, or have any right to, payment of
these funds. Funds advanced pursuant to this subdivision shall be
added to the loan amount secured by the deed of trust and shall be
payable to the department upon demand.
SEC. 13. Section 50893 of the Health and Safety Code is amended to
read:
50893. The department shall make, or undertake commitments to
make, construction or rehabilitation loans, including land
acquisition costs, and mortgage loans in accordance with subdivisions
(a) and (c) for new construction, and subdivisions (b) and (c) for
rehabilitation, to sponsors to finance the development of community
housing developments and congregate housing developments. The
development cost payments may be provided as loans to be repaid at 3
percent interest and payments of principal or interest, or both, may
be deferred or made payable over a period of time. For these
purposes, the department shall enter into regulatory agreements and
other agreements, and security documents, with the sponsors receiving
funds from the fund. Upon the recordation, the regulatory agreement
and all other agreements or documents included or incorporated by
reference within the regulatory agreement shall constitute
enforceable restrictions upon the property for the term of the loan.
The term of the loan and its schedule for repayment may be extended
by the department for additional periods as long as the community
housing development or congregate housing development is operated in
a manner consistent with the regulatory agreement and the sponsor
needs an extension in order to continue to operate the community
housing development or congregate housing development in a manner
consistent with this chapter. Each extension shall be for a period of
not less than 10 years and the total term of the revised loan shall
not exceed 55 years. However, the term of any loan, including any
extension thereof, shall not exceed the useful life of the community
or congregate housing development for which the loan is made.
(a) Loans to sponsors for new construction of community housing
developments or congregate housing developments shall be for terms
not less than 40 years. After 30 years from the time the loans are
made, the sponsor shall begin to repay the loan in accordance with a
payment plan, as determined by the department, that shall maintain
the rents affordable to eligible households.
(b) Loans made to sponsors of community housing developments or
congregate housing developments for acquisition and rehabilitation
shall be for terms of not less than 30 years. Loans made to sponsors
of community housing developments or congregate housing developments
for rehabilitation shall only be for terms of not less than 20 years.
The sponsor may elect to begin to repay the loan at any time in
accordance with a payment plan, as approved by the department, that
shall maintain the rents at levels affordable to eligible households.
(c) Notwithstanding any loan payment plan approved by the
department, the department may permit the prepayment of a loan at any
time, on the basis of net cashflow of a development, provided that
the term of the regulatory agreement shall not be reduced due to any
prepayment.
SEC. 14. Section 2705 of the Public Resources Code is amended to
read:
2705. (a) A city, county, and city and county shall collect a fee
from each applicant for a building permit. Each fee shall be equal
to a specific amount of the proposed building construction for which
the building permit is issued as determined by the local building
officials. The fee amount shall be assessed in the following way:
(1) Group R occupancies, as defined in the California Building
Code (Part 2 of Title 24 of the California Code of Regulations), one
to three stories in height, except hotels and motels, shall be
assessed at the rate of ten dollars ($10) per one hundred thousand
dollars ($100,000), with appropriate fractions thereof.
(2) All other buildings shall be assessed at the rate of
twenty-one dollars ($21) per one hundred thousand dollars ($100,000),
with appropriate fractions thereof.
(3) The fee shall be the amount assessed under paragraph (1) or
(2), depending on building type, or fifty cents ($0.50), whichever is
the higher.
(b) (1) In lieu of the requirements of subdivision (a), a city,
county, and city and county may elect to include a rate of ten
dollars ($10) per one hundred thousand dollars ($100,000), with
appropriate fractions thereof, in its basic building permit fee for
any Group R occupancy defined in paragraph (1) of subdivision (a),
and a rate of twenty-one dollars ($21) per one hundred thousand
dollars ($100,000), with appropriate fractions thereof, for all other
building types. A city, county, and city and county electing to
collect the fee pursuant to this subdivision need not segregate the
fees in a fund separate from any fund into which basic building
permit fees are deposited.
(2) "Building," for the purpose of this chapter, is any structure
built for the support, shelter, or enclosure of persons, animals,
chattels, or property of any kind.
(c) (1) A city, county, and city and county may retain up to 5
percent of the total amount it collects under subdivision (a) or (b)
for data utilization, for seismic education incorporating data
interpretations from data of the strong-motion instrumentation
program and the seismic hazards mapping program, and, in accordance
with paragraph (2), for improving the preparation for damage
assessment after strong seismic motion events.
(2) A city, county, and city and county may use any funds retained
pursuant to this subdivision to improve the preparation for damage
assessment in its jurisdiction only after it provides the Department
of Conservation with information indicating to the department that
data utilization and seismic education activities have been
adequately funded.
(d) Funds collected pursuant to subdivisions (a) and (b), less the
amount retained pursuant to subdivision (c), shall be deposited in
the Strong-Motion Instrumentation and Seismic Hazards Mapping Fund,
as created by Section 2699.5 to be used exclusively for purposes of
this chapter and Chapter 7.8 (commencing with Section 2690).
SEC. 15. Section 2706 of the Public Resources Code is repealed.
