80-006 Code Vt. R. 80-140-006-X
These rules are made and published pursuant to sections 621(5), (12) and (17) and section 624 of the Vermont Housing Finance Agency Act of 1974 as amended, (the "Act").
By No. 77, § 3, effective June 7, 1989 (the "Amendment") the Vermont General Assembly amended 10 V.S.A. § 621(5) to empower the Agency to provide "such grants, loans, or advances as will assist the planning, construction, rehabilitation, and operation of residential housing primarily for persons of low and moderate income, including but not limited to assistance in community development and organization, advisory services, the formation of cooperative housing corporations, and to encourage community organizations to assist in developing same."
The Agency finds that reductions in the amount of federal financial assistance in the provision of safe and decent housing at costs affordable to persons and families of low and moderate income has created a crisis in the availability of such housing, that incentives for private developers and private lenders to participate in the creation and preservation of such housing have declined, and that the excess of demand for such housing over the supply will increase at an expanding rate in the absence of flexible and timely strategies designed to marshall [marshal] all resources available from time to time, including land, existing structures, public funds, and private funds.
It is the purpose of these Rules to encourage an adequate supply of safe and decent housing at reasonable cost, to interpret, limit, and implement, in part, the provisions of 10 V.S.A. § 621(5), as amended by the Amendment, and to establish criteria for mortgage loans to housing sponsors for Single Family Developments.
The following words and terms, unless the context clearly indicates a different meaning, shall have the following meaning:
Terms used in these Rules and in the Act, and not defined above, shall have the same meaning as they have in the Act, as amended from time to time.
The provisions of these rules may be waived by the Commissioners upon their determination that the application of such rules, in specific cases, may result in undue hardship, and that such waiver will not result in a violation of the Act.
If any word, phrase, sentence, paragraph, section or part of these rules is finally adjudged by a court of competent jurisdiction to be invalid, such judgment shall not affect, impair, or invalidate the remainder of these rules.
No Grant shall be made under the authority of these Rules except to a housing sponsor or a Non-Profit Entity, and upon a finding by the Agency that the Grant will assist the planning, construction, rehabilitation, or operation of Residential Housing primarily for persons and families of low and moderate income.
Each Grant shall be made pursuant to a resolution of the Agency, and shall be made subject to such conditions as shall obligate the recipient to its proper use.
A Grant may or may not be made subject to the execution of a formal grant agreement by the recipient In any event, the recipient and any sub-recipient, by the acceptance of the Grant or the proceeds thereof, shall be bound by the conditions of the authorizing resolution and the applicable provisions of these Rules.
The obligations of the recipient of a Grant may be secured in such manner as the circumstances warrant, or may be unsecured, as the Agency may determine to be appropriate in the a particular case; provided, however, that in the case of a Grant to a housing sponsor which is not also a Non-Profit Entity, the housing sponsor's compliance with the conditions of the Grant shall be secured by a mortgage on the involved real estate.
In any case in which the Agency is authorized to make a Grant under these Rules, it may make a loan instead, and such loan may be secured or unsecured to the extent permitted or required by these Rules in the case of a Grant for the same purpose to the same recipient.
The Agency may make Advances with respect to real property owned or controlled by it Such Advances shall be made in anticipation of the sale or lease of such real property or portions thereof to an Eligible Borrower for the purpose of planning, constructing, rehabilitating, and/or operating Residential Housing, provided that the dwelling units in such Residential Housing are intended to be occupied primarily by persons and families of low and moderate income.
Advances for planning, architectural and engineering fees, fees for governmental permits, related legal and consulting fees, and other preliminary costs may be made prior to the identification of a particular buyer for the involved real property.
No Advances for costs of actual and substantial physical changes to the involved real property shall be made unless the Agency has first identified the proposed buyer and has determined that delay in the commencement of such changes pending completion of the sale or execution of a binding contract of sale would be materially disadvantageous to the Agency and/or would increase the ultimate cost of the Residential Housing.
All Advances shall be accounted for at the time of a sale or lease of the involved real property to a housing sponsor or other Eligible Borrower At the closing of such sale or lease, Advances may be deemed made for the benefit of the buyer, and may be accounted for as a portion of the purchase price, rent, loan proceeds, a Grant (in an appropriate case), or any combination thereof If such Advances have been made pursuant to contracts with third parties that remain executory in part as of the time of closing, as a condition of the sale or lease the buyer must agree to assume all obligations of the Agency under such contracts, unless the Agency shall otherwise consent.
The Agency may make loans to Eligible Borrowers to assist the planning, construction, rehabilitation, or operation of Mixed Use Developments in accordance with the terms and conditions of these Rules.
All of the land constituting a Mixed Use Development shall be contiguous Parcels of land separated only by a public way, private way, or non-navigable waters shall be deemed to be contiguous In the case of a Mixed Use Development involving more than two legally identifiable parcels of land, each parcel contiguous to a given parcel shall be deemed contiguous to all parcels to which the given parcel is contiguous.
A Mixed Use Development may be financed by a single mortgage loan to a housing sponsor or, if the portions of the development containing the non-housing facilities can be separated by lease or subdivision as mortgageable parcels, and such separation is deemed desirable by the Agency, the Agency may make a separate loan to an Eligible Borrower with respect to the non-housing facilities The Eligible Borrower with respect to such non-housing facilities may, but need not be, the housing sponsor Any such separate loan shall be secured by a separate mortgage containing such provisions as the Agency may deem appropriate in the particular case.
A Mixed Use Development may be multi-family Residential Housing, a Single Family Development, or any combination thereof.
With respect to any mortgage loan made in whole or in part for the specific purpose of financing dwelling units in a Mixed Use Development which constitutes multi-family Residential Housing, the Multi-Family Rules shall apply to the extent the Multi-Family Rules are consistent with these Rules In the event of a conflict between express provisions of these Rules and the Multi-Family Rules, the applicable provision of these Rules shall be controlling.
The intent of this chapter is to authorize comprehensive financing by the Agency of Mixed Use Developments; provided that the non-housing facilities which are not designed primarily for the benefit of the occupants of the dwelling units shall constitute all or part of an existing structure or structures to be acquired and rehabilitated Nothing in these Rules shall be construed to authorize the financing by the Agency of new, original construction of non-housing facilities which are not designed primarily for the benefit of the occupants of the dwelling units, nor the financing by the Agency of any non-housing facilities except in connection with the financing of Residential Housing.
No loan for a Mixed Use Development shall be made until the Agency has received and reviewed the recommendation of the Executive Director relating to such loan and the Agency has adopted a resolution approving such loan, which resolution shall include the following determinations
Nothing in these rules shall be construed to bar the Agency from financing any Residential Housing merely because part of the building in which the Residential Housing is located, or other buildings on the land on which the Residential Housing is located, is used or will be used for purposes other than Residential Housing.
Pursuant to 0 VSA § 624(a)(1), and these Rules, the Agency may make mortgage loans to housing sponsors for the purpose of financing the acquisition, construction, and/or rehabilitation of Single Family Developments, and, in the case of a housing sponsor which is a limited equity cooperative, for the purpose of financing the long-term operation of the development.
No mortgage loan to a housing sponsor of a Single Family Development shall be made until the Agency has received and reviewed the recommendation of the Executive Director relating to such mortgage loan and the Agency has adopted a resolution approving such mortgage loan, which resolution shall include the following determinations
If the Single Family Development is also a Mixed Use Development, such Development must also satisfy the provisions of Chapter Four of these Rules.
80-006 Code Vt. R. 80-140-006-X
Statutory Authority: 10 V.S.A. § 621(5), 621(12), 621(17) and 624