Section 29-32-104 - Permissible expenditures - affordable housing programs - report(1) The office shall contract with the administrator. The office may select an administrator without a competitive procurement process but shall announce the contract opening publicly and select the administrator in a meeting that is open to the public, no less than seventy-two hours after notice of such meeting is publicly available. No single contract may exceed five years in duration. Upon the expiration of any contract term, the office may renew the contract with the same administrator or may select another administrator. The administrator selected by the office shall expend the money transferred to the financing fund in section 29-32-103 (2) that the administrator receives from the office to support the following programs only:(a) A land banking program to be administered by the administrator. The program shall provide grants to local governments and tribal governments and loans to non-profit organizations with a demonstrated history of providing affordable housing to acquire and preserve land for the development of affordable housing. For purposes of this subsection (1)(a), "affordable housing" means rental housing that has a designated imputed income limit by household size not to exceed sixty percent of the area median income as established by the United States Department of Housing and Urban Development and published by the department or a statewide political subdivision or authority on housing, and regulated units in the project must have a gross rent limit that does not exceed thirty percent of the imputed income limitation applicable to the units and for-sale housing that could be purchased by a household with an annual income of at or below one hundred percent of the area median income. Mixed use development is an allowable use of land purchased under this program if the predominant use of the land is affordable housing. Loans made by the program shall be forgiven if land acquired with the assistance of the program is properly zoned with an active plan for the development of affordable housing within 5 years of date the loan is made and if the development is permitted and funded within 10 years. The lender and borrower may establish additional terms if needed. If land acquired with the assistance of the program is not developed within the timeline above, the loan must be repaid, with interest, as soon as practical, but not more than six months after expiration of said timeline, unless the office agrees to extend all or a portion of the timeline in its reasonable discretion. Land acquired with the assistance of the program that is not developed within the timeline above may be used by the owner for any purpose upon payment of the loan with interest or, in exchange for a waiver of interest, conveyed to a state agency or other entity for the development of affordable housing with the approval of the administrator. All principal and interest payments on loans made under this paragraph (a) shall be paid to the administrator and used by the administrator for the purposes set forth in this subsection (1). As determined by the administrator, a minimum of 15% and a maximum of 25% of monies transferred to the financing fund annually may be used for the program. The administrator may utilize the funds it receives from the office for the program to pay for the costs of administering the program; except that the total combined annual administrative expenditures of money from the financing fund by the administrator and the office shall not exceed two percent of the funds the administrator receives from the office for the program for the state fiscal year.(b) An affordable housing equity program to be administered by the administrator. The program shall make equity investments in low- and middle-income multi-family rental developments. The program shall also make equity investments in existing projects which include multi-family rental units for the purpose of ensuring that said projects remain affordable. The average designated imputed income by household size for projects funded by the program must not exceed 90% of the area median income as established by the United States Department of Housing and Urban Development and published by the department or a statewide political subdivision or authority on housing, and regulated units in the project must have a gross rent limit that does not exceed thirty percent of the imputed income limitation applicable to the units. The program shall include a tenant equity vehicle, meaning, in projects funded by the program, tenants who reside in the project for at least one year shall be entitled to a share of the equity growth in the project, if any, in the form of funding from the program for a down-payment on housing or related purposes, which may also include ongoing opportunities for tenants to build up their savings, in an amount determined by the administrator. Equity investments made by the program shall be made with the expectation of returns that are below the prevailing market returns. Returns on program investments up to the amount of the program's initial investment shall be retained in the program and reinvested. Returns on program investments greater than the program's initial investment shall be retained in the program to fund the tenant equity vehicle. In selecting investments under this program, the administrator shall prioritize high-density housing, mixed-income housing, and projects consistent with the goal of environmental sustainability. As determined by the administrator, a minimum of 40% of monies and a maximum of 70% of monies transferred to the financing fund annually may be used for the program. The administrator may utilize the funds it receives from the office for the program to pay for the costs of administering the program; except that the total combined annual administrative expenditures of money from the financing fund by the administrator and the office shall not exceed two percent of the funds the administrator receives from the office for the program for the state fiscal year.(c) A concessionary debt program to be administered by the administrator. The program shall: (I) Provide debt financing of low- and middle-income multi-family rental developments,(II) Provide gap financing in the form of subordinate debt and pre-development loans for projects that qualify for federal low income housing tax credits,(III) Provide debt financing of existing projects for the purpose of preserving existing affordable multi-family rental units;(IV) Provide debt financing for modular and factory build housing manufacturers; and(V) Include the following features: (A) The average designated imputed income by household size for projects funded by the subprograms specified in subsections (1)(c)(I), (1)(c)(II), and (1)(c)(III) of this section must not exceed 60% of the area median income as established by the United States Department of Housing and Urban Development and published by the department or a statewide political subdivision or authority on housing, and a unit in the project must have a gross rent limit that does not exceed thirty percent of the imputed income limitation applicable to the unit; except that where the subprogram is a secondary source of funding, the affordability threshold required by the primary funding source, if any, may be operative. The subprogram specified in subsection (1)(c)(IV) of this section does not have a designated imputed income or rent limit. Debt financing and loans made by the program shall be made at below market interest rates as determined by the administrator. Returns on program investments up to the amount of the program's initial investment shall be retained in the program and reinvested by the administrator in the program established in this subsection (1)(c). Returns on program investments greater than the program's initial investment shall be retained in the program to fund the tenant equity vehicle of the affordable housing equity program created in subsection (1)(b) of this section.(B) As determined by the administrator, a minimum of 15% of monies and a maximum of 35% of monies transferred to the financing fund annually may be used for the program. The administrator may utilize the funds it receives from the office for the program to pay for the costs of administering the program; except that the total combined annual administrative expenditures of money from the financing fund by the administrator and the office shall not exceed two percent of the funds the administrator receives from the office for the program for the state fiscal year.(2) In selecting investments to be made by the programs of subsection (1) of this section, the administrator shall prioritize projects that achieve high-density housing, mixed-income housing, and projects consistent with the goal of environmental sustainability, as appropriate.(3) The division of housing and the division of local government shall expend the money transferred to the support fund in section 29-32-103 (1) to support the following programs only:(a) An affordable home ownership program administered by the division or one or more contractors of the division. The program shall offer home ownership down-payment assistance to first-time homebuyers and shall prioritize assistance, to the extent practicable, to first-generation homebuyers. The assistance shall be provided to households with income less than or equal to 120% of the area median income of households of that size in the territory or jurisdiction of local government or tribal government in which the housing is located, as calculated and published for a given year by the United States Department of Housing and Urban Development, and the cost of the monthly housing payment towards mortgage principal, mortgage interest, property taxes, mortgage and homeowner's insurance, homeowner association fees, land lease fees, and metropolitan district fees shall not cost more than 35% of monthly household income. The program shall also make grants to non-profits, local governments, tribal governments, community development financial institutions, and community land trusts to support affordable home ownership. The program shall also make grants or loans to groups or associations of mobile home owners and their assignees to assist them with the purchase of a mobile home park pursuant to section 38-12-217. Said grants and loans shall be used to support affordable home ownership for households with income less than or equal to 100% of the area median income of households of that size in the territory or jurisdiction of local government or tribal government in which the households are located, as calculated and published for a given year by the United States Department of Housing and Urban Development, and the cost of the monthly housing payment towards mortgage principal, mortgage interest, property taxes, mortgage and homeowner's insurance, homeowner association fees, land lease fees, and metropolitan district fees shall not cost more than 35% of monthly household income. All principal and interest payments on loans made under this paragraph (a) shall be paid to the division and used by the division for the purposes set forth in this subsection (3). Up to 50% of monies transferred to the support fund annually may be used for the program. The division shall determine how much of the available funding shall be allocated to each aspect of the program. The division may utilize up to 5% of the funds it allocates from the fund for the program each state fiscal year to pay for the direct and indirect costs of administering the program.(b) A program serving persons experiencing homelessness to be administered by the division. The program shall provide rental assistance, housing vouchers, and eviction defense assistance, including legal, financial, and case management, to persons experiencing homelessness or at risk of experiencing homelessness. The program shall also make grants or loans to non-profit organizations, local governments, tribal governments, or private entities to support the development and preservation of supportive housing for persons experiencing homelessness, and other homelessness related activities the division determines contribute to the resolution of or prevention of homelessness, including housing programs paid for by non-profit organizations, local governments, tribal governments, or private entities on a pay for success basis, meaning an organization, local government, tribal government, or private entity would receive financial support from the program upon achieving objectives contractually agreed upon with the division. All principal and interest payments on loans made under this paragraph (b) shall be paid to the division and used by the division for the purposes set forth in this subsection (3). Up to 45% of monies transferred to the support fund annually may be used for the program. The division may utilize up to 5% of the funds it allocates from the fund for the program each state fiscal year to pay for the direct and indirect costs of administering the program.(c) A local planning capacity development program administered by the division of local government. The program shall provide grants to local governments and tribal governments to increase the capacity of local government and tribal government planning departments responsible for processing land use, permitting and zoning applications for housing projects. Up to 5% of monies transferred to the support fund annually may be used for the program. The division of local government may utilize up to 5% of the funds that the division of housing allocates from the fund for the program each state fiscal year to pay for the direct and indirect costs of administering the program.(4) On or before October 1, 2024, and October 1 of the next two years thereafter, the office and division shall respectively provide to the joint budget committee, the senate local government and housing committee, and the house of representatives transportation, housing, and local government committee, or their successor committees, a report about the disbursements from the financing fund and support fund for the prior state fiscal year. In the reports, the office and the division shall include the following information about each affordable housing program: (a) The applicants for funding, the projects funded, and the projects that were denied, along with the reason for the denial;(b) The anticipated or actual number of households served and the number of affordable housing rental units and for-sale units funded; and(c) The geographic distribution of the funding.(5) If the Legislative Council Staff's March Economic and Revenue Forecast in any given year projects revenue for the next state fiscal year will fall below the revenue limit imposed under section 20 of article X of the state constitution, the general assembly may reduce the funding allocated to the office required by this section for the next state fiscal year in order to balance the state budget for said state fiscal year.Amended by 2023 Ch. 381,§ 3, eff. 6/5/2023.Added by 2022 Ballot Proposition 123, passed by voters in 11/8/2020 election, effective 12/27/2022.