Section 7684 - Limits on Distributions(a) A sponsor shall be limited to an annual distribution on the sponsor's actual investment in the project in an amount not to exceed eight percent per annum. A sponsor may not accumulate distributions from year to year. (1) For a project involving only rehabilitation and no acquisition or refinancing, actual investment is determined as follows: the market value of the rental housing development prior to rehabilitation, as determined in an appraisal, less outstanding debt prior to rehabilitation, plus any cash contributions to the project made by the sponsor.(2) For a project involving rehabilitation and either acquisition or refinancing, actual investment is the amount of any cash contributions to the project made by the sponsor. Cash contributions do not include government assistant or private donations, other than the sponsor's, to the project.(b) In its initial operating budget, the sponsor shall demonstrate to the department the amount of the sponsor's actual investment in the residential portion of the project on which the allowable distribution will be calculated. The actual investment amount may be increased in subsequent budgets upon a showing of additional actual investment other than prepayments of principal advanced by the sponsor.(c) Distributions shall be permitted only after the sponsor submits a complete annual report and operating budget and the department determines that the report and budget demonstrate compliance with all program requirements for the applicable year.(d) Distributions attributed to the nonresidential space shall not be subject to limits pursuant to this section, except where program funds have been used for nonresidential space pursuant to section 7675(c). Where program funds have not been used pursuant to section 7675(c), then for purposes of calculating allowable distributions, operating income and expenses shall not include income or expenses from nonresidential space.(e) No distributions shall be made in the following circumstances:(1) when written notice of default has been issued by any entity with an equitable or beneficial interest in the rental housing development;(2) when the department determines that the sponsor has failed to comply with the department's written notice of any reasonable requirement for proper maintenance or operation of the rental housing development;(3) if all currently required debt service and operating expenses have not been paid;(4) if the replacement reserve account or any other reserve accounts are not fully funded pursuant to section 7696 and the Regulatory Agreement.(f) When operating income is greater than approved operating expenses, debt service, scheduled reserve deposits, approved prepayments, approved annual distributions, and any other disbursements approved by the department, then the sponsor shall pay such excess income into the Residual Receipts Account established pursuant to section 7697. Where program funds have not been used for costs attributable to nonresidential space pursuant to section 7675(c) and for purposes of calculating the amount of excess funds pursuant to this subdivision, operating income and expenses shall not include income or expenses from nonresidential space.Cal. Code Regs. Tit. 25, § 7684
1. New section filed 6-12-89 as an emergency pursuant to Health and Safety Code section 50668.5(g); operative 6-12-89 (Register 89, No. 24). A Certificate of Compliance must be transmitted to OAL within 120 days or the regulation will be repealed on 10-10-89. For history of former subchapter 8 (sections 7700-7714.5, not consecutive), see Register 85, No. 33.
2. New section refiled 10-6-89 as an emergency pursuant to Health and Safety Code section 50668.5(g) and Government Code section 11346.1(h); operative 10-10-89 (Register 89, No. 42). A Certificate of Compliance must be transmitted to OAL within 120 days or emergency language will be repealed on 2-7-90.
3. New section refiled 2-5-90 as an emergency pursuant to Health and Safety Code section 50668.5(g) and Government Code section 11346.1(h); operative 2-7-90 (Register 90, No. 6). A Certificate of Compliance must be transmitted to OAL within 120 days or emergency language will be repealed on 6-7-90.
4. Amendment filed 3-5-90 as an emergency pursuant to Health and Safety Code section 50668.5(g); operative 3-5-90 (Register 90, No. 12). A Certificate of Compliance must be transmitted to OAL within 120 days or emergency language will be repealed on 7-3-90.
5. Certificate of Compliance as to 2-5-90 and 3-5-90 orders including amendment of subsections (a), (b), (d) and (f) transmitted to OAL 5-22-90 and filed 5-29-90 (Register 90, No. 29). Note: Authority cited: Section 50668.5, Health and Safety Code. Reference: Sections 50668.5 and 50670, Health and Safety Code.
1. New section filed 6-12-89 as an emergency pursuant to Health and Safety Code section 50668.5(g); operative 6-12-89 (Register 89, No. 24). A Certificate of Compliance must be transmitted to OAL within 120 days or the regulation will be repealed on 10-10-89. For history of former subchapter 8 (sections 7700-7714.5, not consecutive), see Register 85, No. 33.
2. New section refiled 10-6-89 as an emergency pursuant to Health and Safety Code section 50668.5(g) and Government Code section 11346.1(h); operative 10-10-89 (Register 89, No. 42). A Certificate of Compliance must be transmitted to OAL within 120 days or emergency language will be repealed on 2-7-90.
3. New section refiled 2-5-90 as an emergency pursuant to Health and Safety Code section 50668.5(g) and Government Code section 11346.1(h); operative 2-7-90 (Register 90, No. 6). A Certificate of Compliance must be transmitted to OAL within 120 days or emergency language will be repealed on 6-7-90.
4. Amendment filed 3-5-90 as an emergency pursuant to Health and Safety Code section 50668.5(g); operative 3-5-90 (Register 90, No. 12). A Certificate of Compliance must be transmitted to OAL within 120 days or emergency language will be repealed on 7-3-90.
5. Certificate of Compliance as to 2-5-90 and 3-5-90 orders including amendment of subsections (a), (b), (d) and (f) transmitted to OAL 5-22-90 and filed 5-29-90 (Register 90, No. 29).