July 6, 2004, Introduced by Reps. Tobocman, Hune, Kolb, Gaffney, Wenke, Ward, Nofs, Whitmer, Bieda, Kooiman, Lipsey, Williams, Murphy, Jamnick, Adamini, Accavitti and Hunter and referred to the Committee on Local Government and Urban Policy.
A bill to amend 1966 PA 346, entitled
"State housing development authority act of 1966,"
by amending sections 11, 32b, 44, and 44a (MCL 125.1411,
125.1432b, 125.1444, and 125.1444a), section 11 as amended by
1996 PA 475 and sections 32b, 44, and 44a as amended by 2000 PA
257.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
1 Sec. 11. As used in this act:
2 (a) "Authority" means the Michigan state housing development
3 authority created in this act.
4 (b) "Development costs" means the costs that have been
5 approved by the authority as appropriate expenditures, and
6 includes:
7 (i) Payments for options to purchase properties on the
8 proposed housing project site, deposits on contracts of purchase,
1 or, with the prior approval of the authority, payments for the
2 purchases of those properties.
3 (ii) Legal, organizational, and marketing expenses, including
4 payment of attorneys' fees, project manager and clerical staff
5 salaries, office rent, and other incidental expenses.
6 (iii) Payment of fees for preliminary feasibility studies,
7 advances for planning, engineering, and architectural work.
8 (iv) Expenses for surveys as to need, and market analyses.
9 (v) Necessary application and other fees to federal and other
10 government agencies.
11 (vi) Other expenses incurred by the nonprofit housing
12 corporation, consumer housing cooperative, limited dividend
13 housing corporation, mobile home park corporation, or mobile home
14 park association that the authority considers appropriate to
15 effectuate the purposes of this act.
16 (c) "Federally-aided mortgage" means any of the following:
17 (i) A below market interest rate mortgage insured, purchased,
18 or held by the secretary of the department of housing and urban
19 development.
20 (ii) A market interest rate mortgage insured by the secretary
21 of the department of housing and urban development and augmented
22 by a program of rent supplements.
23 (iii) A mortgage receiving interest reduction payments
24 provided by the secretary of the department of housing and urban
25 development.
26 (iv) A mortgage on a housing project to which the authority
27 allocates low income housing tax credits under section 22b.
1 (v) A mortgage receiving special benefits under other federal
2 law designated specifically to develop low and moderate income
3 housing, consistent with this act.
4 (d) "Fund" means the housing development fund created by this
5 act.
6 (e) "Project cost" means the sum total of all reasonable or
7 necessary costs incurred by the nonprofit housing corporation,
8 consumer housing cooperative, limited dividend housing
9 corporation, mobile home park corporation, or mobile home park
10 association for carrying out all works and undertakings for the
11 completion of a housing project and approved by the authority.
12 In addition to other reasonable and necessary costs, "project
13 costs" includes costs for all of the following: studies and
14 surveys; plans, specifications, and architectural and engineering
15 services; legal, organization, marketing, or other special
16 services; financing, acquisition, demolition, construction,
17 equipment, and site development of new and rehabilitated
18 buildings; movement of existing buildings to other sites;
19 rehabilitation, reconstruction, repair, or remodeling of existing
20 buildings; carrying charges during construction; the cost of
21 placement of tenants or occupants, and relocation services in
22 connection with a housing project; and, to the extent not already
23 included, all development costs.
24 (f) "Housing project" means any of the following:
25 (i) Residential real property developed or to be developed or
26 receiving benefits under this act.
27 (ii) A specific work or improvement either for rental or for
1 subsequent sale to an individual purchaser undertaken by a
2 nonprofit housing corporation, consumer housing cooperative,
3 limited dividend housing corporation, mobile home park
4 corporation, or mobile home park association pursuant to or
5 receiving benefits under this act to provide dwelling
6 accommodations, including the acquisition, construction, or
7 rehabilitation of lands, buildings, and improvements.
8 (iii) Social, recreational, commercial, and communal
9 facilities that the authority finds necessary to serve and
10 improve a residential area in which housing described in
11 subparagraph (i) or (ii) is located or is planned to be located,
12 thereby enhancing the viability of the housing.
13 (g) "Low income or moderate income persons" means families
14 and persons who cannot afford to pay the amounts at which private
15 enterprise, without federally-aided mortgages or loans from the
16 authority, is providing a substantial supply of decent, safe, and
17 sanitary housing and who fall within income limitations set in
18 this act or by the authority in its rules. Among low income or
19 moderate income persons, preference shall be given to the elderly
20 and those displaced by urban renewal, slum clearance, or other
21 governmental action.
22 (h) "Municipality" means a city, village, or township in this
23 state.
24 (i) "County" means a county within this state.
25 (j) "Governing body" means in the case of a city, the council
26 or commission of the city; in the case of a village, the council,
27 commission, or board of trustees of the village; in the case of a
1 township, the township board; and in the case of a county, the
2 county board of commissioners.
3 (k) "Nonprofit housing corporation" means a nonprofit
4 corporation incorporated under the corporation laws of this state
5 and chapter 4.
6 (l) "Consumer housing cooperative" means a nonprofit
7 corporation incorporated pursuant to the corporation laws of this
8 state and chapter 5.
9 (m) "Annual shelter rent" means the total collections during
10 an agreed annual period from all occupants of a housing project
11 representing rent or occupancy charges, exclusive of charges for
12 gas, electricity, heat, or other utilities furnished to the
13 occupants.
14 (n) "Taxing jurisdiction" means a municipality, county, or
15 district, including a school district or any special district
16 having the power to levy or collect taxes upon real property or
17 in whose behalf taxes may be levied or collected.
18 (o) "Elderly" means a single person who is 55 years of age or
19 older or a household in which at least 1 member is 55 years of
20 age or older and all other members are 50 years of age or older.
21 (p) "Housing development" means a development that contains a
22 significant element of housing for persons of low or moderate
23 income and elements of other housing and commercial,
24 recreational, industrial, communal, and educational facilities
25 that the authority determines improve the quality of the
26 development as it relates to housing for persons of low or
27 moderate income.
1 (q) "Limited dividend housing corporation" means a
2 corporation incorporated or qualified pursuant to the corporation
3 laws of this state and chapter 6 and a limited dividend housing
4 association organized and qualified pursuant to chapter 7.
5 (r) "Residential real property" means real property located
6 in this state, used for residential purposes, and improved or to
7 be improved by a residential structure. Residential real
8 property includes a mobile home, a mobile home park, and a mobile
9 home condominium project. When the terms "rehabilitate" or
10 "rehabilitation" are used in conjunction with residential real
11 property, residential real property refers to property improved
12 by a residential structure.
13 (s) "Rehabilitation" means all or part of those repairs and
14 improvements necessary to make residential real property safe,
15 sanitary, or adequate.
16 (t) "Deferred payment loan" means a loan that is repayable or
17 partially repayable upon the occurrence of a specified event as
18 determined by the authority.
19 (u) "Eligible distressed area" means any of the following:
20 (i) An area located in a city with a population of at least
21 10,000, which area is either designated as a "blighted area" by a
22 local legislative body
pursuant to Act No. 344 of the Public
23 Acts of 1945, being
sections 125.71 to 125.84 of the Michigan
24 Compiled Laws 1945 PA 344, MCL 125.71 to 125.84, or which
area
25 is determined by the authority to be blighted or largely vacant
26 by reason of clearance of blight, if, with respect to the area,
27 the authority determines all of the following:
1 (A) That private enterprise has failed to provide a supply of
2 adequate, safe, and sanitary dwellings sufficient to meet market
3 demand.
4 (B) That approval of elimination of income limits applicable
5 in connection with authority loans has been received from the
6 city in the form of either a resolution adopted by the highest
7 legislative body of the city or, if the city charter provides for
8 the mayor to be elected at large with that office specifically
9 designated on the ballot, provides that the office of mayor is a
10 full-time position, and provides that the mayor has the power to
11 veto legislative actions of the legislative body of that city, a
12 written communication from the mayor of that city.
13 (ii) A municipality that meets all of the following
14 requirements:
15 (A) The municipality shows a negative population change from
16 1970 to the date of the most recent federal decennial census.
17 (B) The municipality shows an overall increase in the state
18 equalized value of real and personal property of less than the
19 statewide average increase since 1972.
20 (C) The municipality has a poverty rate, as defined by the
21 most recent federal decennial census, greater than the statewide
22 average.
23 (D) The municipality has had an unemployment rate higher than
24 the statewide average unemployment rate for 3 of the preceding 5
25 years.
26 (iii) An area located in a local unit of government certified
27 by the Michigan enterprise zone authority as meeting the criteria
1 prescribed in section 2(d) of the neighborhood enterprise zone
2 act, Act No. 147 of
the Public Acts of 1992, being section
3 207.772 of the
Michigan Compiled Laws 1992 PA
147, MCL 207.772.
4 (v) "Mobile home" means a structure, transportable in 1 or
5 more sections, that is built on a chassis and is designed to be
6 used as a dwelling with or without permanent foundation, when
7 connected to the required utilities, and includes the plumbing,
8 heating, air conditioning, and electrical systems contained in
9 the structure. Mobile home may, but need not, include the real
10 property to which the mobile home may be attached. Mobile home
11 does not include a recreational vehicle.
12 (w) "Mobile home condominium project" means a condominium
13 project in which mobile homes are intended to be located upon
14 separate sites that constitute individual condominium units and
15 that complies with the
condominium act, Act No. 59 of the Public
16 Acts of 1978, being
sections 559.101 to 559.275 of the Michigan
17 Compiled Laws 1978 PA 59, MCL 559.101 to 559.276.
18 (x) "Mobile home park" means a parcel or tract of land under
19 the control of a person or entity upon which 3 or more mobile
20 homes are located on a continual, nonrecreational, residential
21 basis and that is offered to the public for general public use
22 for continual, nonrecreational, residential purposes regardless
23 of whether a charge is made for that use, together with any
24 social, recreational, commercial, and communal facilities used or
25 intended for use incident to the occupancy of a mobile home.
26 Mobile home park does not include trailer parks and courts for
27 use on a transient basis.
1 (y) "Mobile home park association" means a mobile home park
2 association organized and qualified in accordance with chapter
3 9.
4 (z) "Mobile home park corporation" means a corporation
5 incorporated pursuant to the corporation laws of this state and
6 qualified in accordance with chapter 8.
7 (aa) "Housing unit" means living accommodations that are
8 intended for occupancy by up to 4 families, with a separate
9 dwelling unit for each family, that may be site constructed or
10 may be a mobile home or other form of manufactured housing, and
11 with respect to which either of the following applies:
12 (i) The owner of the housing occupies at least 1 of the
13 dwelling units.
14 (ii) A cooperative shareholder or member has a proprietary
15 lease of the housing unit.
16 (bb) "Moderate cost residential rental property" means
17 dwelling units for which the rental payments are equal to or less
18 than that established from time to time as the fair market rents
19 for existing housing in accordance with 1 of the following:
20 (i) The section 8 leased housing program established under
21 section 8 of the United
States housing act of 1937, 42 U.S.C.
22 USC 1437f, and the regulations promulgated under that act, or a
23 substantially equivalent successor federal program.
24 (ii) A determination made by the authority of the average
25 fair market rent for existing rental property.
26 (cc) "Area of chronic economic distress" means an area that
27 qualifies as a "qualified census tract" or an "area of chronic
1 economic distress" as defined in former section 103A(k) of the
2 internal revenue code, or an eligible distressed area.
3 (dd) "Mortgage lender" means a state or national bank, state
4 or federal savings and loan association, mortgage company,
5 insurance company, state pension fund, or any other financial
6 institution, intermediary, or entity authorized to make mortgage
7 loans in this state.
8 (ee) "Authority-aided mortgage" means a mortgage made, held,
9 purchased, or assisted by the authority.
10 (ff) "Subsidiary nonprofit housing corporation" means an
11 entity created under section 22c.
12 (gg) "Family income" means all income that is included in a
13 determination of family income under section 143(f) of the
14 internal revenue code, 26 USC 143(f), together with the income of
15 all adults who will reside in the residence, which income might
16 otherwise be excluded from consideration because the individual
17 was not expected to both live in the residence and be primarily
18 or secondarily liable on the mortgage note.
19 (hh) "Statewide median gross income" means the statewide
20 median gross income as determined under section 143(f) of the
21 internal revenue code, 26 USC 143(f).
22 (ii) "Mutual housing association" means a corporation
23 organized in accordance with chapter 10.
24 (jj) "Internal revenue code" means the United States internal
25 revenue code of 1986.
26 (kk) "Internal revenue code of 1954" means the United States
27 internal revenue code of 1954 as in effect on the day immediately
1 before the effective date of the internal revenue code of 1986.
2 Sec. 32b. (1) The authority is designated as the
3 administrator of the mortgage credit certificate program for this
4 state permitted under section 25 of the internal revenue code,
5 of 1986 26 USC 25. The authority shall elect
under section 25
6 of the internal
revenue code of 1986 to convert at least
7 $59,000,000.00 of 1985
federal mortgage revenue bond authority
8 into mortgage credit
certificate authority.
9 (2) The authority shall prepare guidelines that would allow
10 for the implementation of a mortgage credit certificate program
11 through mortgage lenders.
12 (3) To qualify for receipt of a mortgage credit certificate
13 with respect to the
acquisition of an a new or existing housing
14 unit, including a residential condominium or mobile home, both of
15 the following apply:
16 (a) The purchase
price with respect to the unit shall not
17 exceed the following:
18 (i) $99,000.00 until November 1, 2001.
19 (ii) $102,000.00 until November 1, 2002.
20 (iii) On and after November 1, 2002, $105,000.00.
21 (b) The borrower's
family income does not exceed either of
22 the following:
23 (i) If the housing unit is located in a metropolitan
area,
24 $52,900.00 on or
before November 1, 2001, $54,750.00 from
25 November 2, 2001 until
November 1, 2002, and $56,650.00 on and
26 after November 1,
2002.
27 (ii) If the housing unit is located in a nonmetropolitan
1 area, $43,575.00 on or
before November 1, 2002. After November
2 1, 2002, the family
income limit increases to the lesser of the
3 HUD nonmetropolitan
median income or $44,000.00.
4 (4) To qualify for
receipt of a mortgage credit certificate
5 with respect to the
acquisition of a new housing unit, including
6 a residential
condominium or mobile home, both of the following
7 apply:
8 (a) The purchase
price with respect to the unit shall not
9 exceed the following:
10 (i) $120,000.00 until November 1, 2001.
11 (ii) $124,000.00 until November 1, 2002.
12 (iii) On and after November 1, 2002, $128,000.00.
13 (b) The borrower's
family income does not exceed either of
14 the following:
15 (i) If the housing unit is located in a metropolitan
area,
16 $52,900.00 on or
before November 1, 2001, $54,750.00 from
17 November 2, 2001 until
November 1, 2002, and $56,650.00 on and
18 after November 1,
2002.
19 (ii) If the housing unit is located in a nonmetropolitan
20 area, $43,575.00 on or
before November 1, 2002.
21 (iii) After November 1, 2002, the family income limit
22 increases to the
lesser of the HUD nonmetropolitan median income
23 or $44,000.00.
24 (a) The purchase price with respect to the new or existing
25 unit shall not exceed 3 times the income limit, as established
26 from time to time by the United States secretary of the treasury
27 pursuant to section 143(f) of the internal revenue code, 26 USC
1 143(f), as determined by the authority following its receipt of
2 the application.
3 (b) The borrower's family income does not exceed the
4 following:
5 (i) For eligible distressed areas, 115% of state median
6 income, as established from time to time by the United States
7 secretary of the treasury pursuant to section 143(f) of the
8 internal revenue code, 26 USC 143(f).
9 (ii) For any other area, 100% of state median income, as
10 established from time to time by the United States secretary of
11 the treasury pursuant to section 143(f) of the internal revenue
12 code, 26 USC 143(f).
13 (4) (5) The
authority may increase the purchase price limit
14 in subsection (3) to cover the cost of improvements to adapt the
15 property for use by disabled individuals or unexpected cost
16 increases during construction. The amount of the increase shall
17 be the amount of the costs described in this subsection or the
18 sum of $3,500.00, whichever is less.
19 (5) (6) To
qualify for receipt of a mortgage credit
20 certificate with respect to the improvement or rehabilitation of
21 an existing housing unit, including a residential condominium or
22 mobile home, the borrower's family income shall not exceed the
23 following:
24 (a) For a unit
located in a metropolitan county, $52,900.00
25 on or before November
1, 2001, $54,750.00 from November 2, 2001
26 until November 1,
2002, and $56,650.00 on and after November 1,
27 2002.
1 (b) For a unit
located in a nonmetropolitan county,
2 $43,575.00 on or
before November 1, 2002. After November 1,
3 2002, the family
income limit increases to the lesser of the HUD
4 nonmetropolitan median
income or $44,000.00.
5 (a) For eligible distressed areas, 115% of state median
6 income, as established from time to time by the United States
7 secretary of the treasury pursuant to section 143(f) of the
8 internal revenue code, 26 USC 143(f).
9 (b) For any other area, 100% of state median income, as
10 established from time to time by the United States secretary of
11 the treasury pursuant to section 143(f) of the internal revenue
12 code, 26 USC 143(f).
13 (6) (7) If
an income or purchase price limit prescribed by
14 subsection (3), (4), or
(5) , or (6) exceeds an applicable
15 limit prescribed by the
internal revenue code, of 1986 26 USC 1
16 to 9833, the internal
revenue code of 1986 limit applies.
17 Except with respect to newly constructed housing units, the
18 authority may at any time by resolution establish, for a length
19 of time it considers appropriate, maximum borrower income or
20 purchase price limits more restrictive than those maximum
21 limitations set forth in this section. The authority shall
22 advise the appropriate house and senate standing committees 5
23 days prior to the adoption of a resolution establishing more
24 restrictive income or purchase price limits.
25 (7) (8) The
changes made by 1995 PA 186 to purchase price
26 limits in the subsections that at the time were designated
27 subsections (3) and (4) were retroactive, effective as of
1 October 29, 1993.
2 Sec. 44. (1) (a) The authority may make loans to a
3 nonprofit housing corporation, consumer housing cooperative,
4 limited dividend housing corporation, limited dividend housing
5 association, mobile home park corporation, or mobile home park
6 association or to a public body or agency for the construction or
7 rehabilitation, and for the long-term financing, of the
8 following:
9 (i) Housing for low income or moderate income persons.
10 (ii) For the period of time beginning May 1, 1984, and ending
11 November 1, 1987, housing projects in which not less than 20% of
12 the dwelling units are allotted to individuals of low or moderate
13 income within the meaning of former section 103(b)(4)(A) of the
14 internal revenue code of 1986
1954; not less than 60% of the
15 dwelling units are available to persons and families whose gross
16 household income does not exceed 125% of the higher of either the
17 median income for a family in this state or the median income for
18 a family within the nonmetropolitan county or metropolitan
19 statistical area in which the housing project is located, as
20 determined by the authority; and not more than 20% of the
21 dwelling units are available for occupancy without regard to
22 income. The enactment of this subparagraph or the expiration of
23 the authority granted by it does not affect rules in effect
24 before July 10, 1984, or promulgated after July 9, 1984, to
25 define low or moderate income persons.
26 (iii) For the period of time beginning May 1, 1984, and
27 ending November 1, 1987, housing projects in eligible distressed
1 areas in which housing projects not less than 20% of the dwelling
2 units are allotted to individuals of low or moderate income
3 within the meaning of former section 103(b)(4)(A) of the internal
4 revenue code of 1986 1954;
not less than 60% of the dwelling
5 units are available to persons and families whose gross household
6 income does not exceed 150% of the higher of either the median
7 income for a family in this state or the median income for a
8 family within the nonmetropolitan county or metropolitan
9 statistical area in which the housing project is located, as
10 determined by the authority, and not more than 20% of the
11 dwelling units are available for occupancy without regard to
12 income.
13 (iv) Beginning November 1, 1987, multifamily housing
14 projects that meet the
20-50 or 40-60 test established in section
15 142 of the internal
revenue code of 1986 and, in addition, in
16 which not less than
15% of the dwelling units are allotted to
17 persons and families
whose gross household income does not exceed
18 125% of the higher of
either the median income for a family in
19 this state or the
median income for a family within the
20 nonmetropolitan county
or metropolitan statistical area in which
21 the housing project is
located, as determined by the authority,
22 or to the elderly; not
less than 15% of the dwelling units are
23 allotted to persons
and families whose gross household income
24 does not exceed 150%
of the median income for a family in this
25 state or the median
income for a family within the
26 nonmetropolitan county
or metropolitan statistical area in which
27 the housing project is
located, as determined by the authority,
1 or to the elderly; and
not more than 50% of the dwelling units
2 are available for
occupancy without regard to income.
3 (iv) (v) Beginning
November 1, 1987, multifamily housing
4 projects in eligible
distressed areas that meet the 20-50 or
5 40-60 test established in section 142 of the internal revenue
6 code, of 1986 26
USC 142, and, in addition, in which the
7 remaining dwelling units are available for occupancy without
8 regard to income.
9 (v) (vi) Social,
recreational, commercial, or communal
10 facilities necessary to serve and improve the residential area in
11 which an authority-financed housing project is located or is
12 planned to be located thereby enhancing the viability of the
13 housing.
14 (b) Notwithstanding the provisions of this section, the
15 authority may establish by resolution higher income limits that
16 it considers necessary to achieve sustained occupancy of a
17 housing project financed under subsection (1)(a)(i), (ii), (iii),
18 (iv), or (v) if the authority determines both of the following:
19 (i) The owner of the housing project exercised reasonable
20 efforts to rent the dwelling units to persons and families whose
21 incomes did not exceed the income limitations originally
22 applicable.
23 (ii) For an annual period after the first tenant has occupied
24 the housing project, the owner of the housing project has been
25 unable to attain and sustain at least a 95% occupancy level at
26 the housing project.
27 (c) A loan under this section may be in an amount not to
1 exceed 90% of the project cost as approved by the authority. For
2 purposes of this section, the term "project cost" includes all
3 items included in the definition of a project cost in section 11
4 and also includes a builder's fee equal to an amount up to 5% of
5 the amount of the construction contract, developer overhead
6 allowance and fee of 5% of the amount of the project cost, the
7 cost of furnishings, and a sponsor's risk allowance equal to 10%
8 of the project cost. A loan shall not be made under this section
9 unless a market analysis has been conducted that demonstrates a
10 sufficient market exists for the housing project.
11 (d) After November 1, 1987, the authority may continue to
12 finance multifamily housing projects for families or persons
13 whose incomes do not exceed the limits provided in subsection
14 (1)(a)(ii) or (iii) or (1)(b), until funds derived from the
15 proceeds of bonds or notes issued before November 2, 1987, for
16 that purpose, including the proceeds of prepayments or recovery
17 payments with respect to these multifamily housing projects, have
18 been expended. Multifamily housing projects or single family
19 housing units in an eligible distressed area that are financed by
20 proceeds of notes or bonds issued before June 30, 1984, and that
21 the authority has designated for occupancy by persons and
22 families without regard to income pursuant to this act shall
23 remain eligible for occupancy by families and persons without
24 regard to income until the authority's mortgage loan issued with
25 respect to these multifamily housing projects is fully repaid.
26 (e) Notwithstanding the expiration of lending authority under
27 subsection (1)(a)(ii), (iii), (iv), or (v), multifamily housing
1 projects financed under those subparagraphs may continue to
2 remain eligible for occupancy by persons and families whose
3 incomes do not exceed the limits provided in those subparagraphs
4 or subsection (1)(b).
5 (f) For purposes of this subsection:
6 (i) "Gross household income" means gross income of a
7 household as those terms are defined in rules of the authority.
8 (ii) "Median income for a family in this state" and "median
9 income for a family within the nonmetropolitan county or
10 metropolitan statistical area" mean those income levels as
11 determined by the authority.
12 (2) (a) The authority may make loans to a nonprofit housing
13 corporation, limited dividend housing corporation, mobile home
14 park corporation, or mobile home park association for the
15 construction or rehabilitation of housing units, including
16 residential condominium units as defined in section 4 of the
17 condominium act, 1978 PA 59, MCL 559.104, for sale to individual
18 purchasers of low or moderate income or to individual purchasers
19 without regard to income when the housing units are located in an
20 eligible distressed area. A loan under this section may be in an
21 amount not to exceed 100% of the project cost as approved by the
22 authority in the case of a nonprofit housing corporation or
23 individual purchaser, and in an amount not to exceed 90% of the
24 project cost as approved by the authority in the case of a
25 limited dividend housing corporation, mobile home park
26 corporation, or mobile home park association.
27 (b) While a loan under this subsection is outstanding, a sale
1 by a nonprofit housing corporation or limited dividend housing
2 corporation or a subsequent resale is subject to approval by the
3 authority. The authority
shall may provide in its rules
4 concerning these sales and resales that the price of the housing
5 unit sold, the method of making payments after the sale, the
6 security afforded, and the interest rate, fees, and charges to be
7 paid shall at all times be sufficient to permit the authority to
8 make the payments on its bonds and notes and to meet
9 administrative or other costs of the authority in connection with
10 the transactions. Housing units shall be sold under terms that
11 provide for monthly payments including principal, interest,
12 taxes, and insurance.
13 (c) While a loan under this subsection is outstanding, the
14 authority, before the approval of sale by a nonprofit housing
15 corporation, limited dividend housing corporation, mobile home
16 park corporation, or mobile home park association, shall satisfy
17 itself that the sale is to persons of low or moderate income if
18 the housing unit is not located in an eligible distressed area,
19 or to persons without regard to income if the housing unit is
20 located in an eligible distressed area.
21 (d) Upon the sale
by a nonprofit housing corporation,
22 limited dividend
housing corporation, mobile home park
23 corporation, or mobile
home park association of a housing unit to
24 an individual
purchaser of low or moderate income or to an
25 individual purchaser
without regard to income if the unit is
26 located in an eligible
distressed area under this subsection to
27 whom a loan is being
made by the authority, the housing unit
1 shall be released from
the mortgage running from the nonprofit
2 housing corporation,
limited dividend housing corporation, mobile
3 home park corporation,
or mobile home park association to the
4 authority, and the
mortgage shall be replaced as to the housing
5 unit by a mortgage
running from the individual purchaser to the
6 authority.
7 (e) The authority
shall encourage nonprofit housing
8 corporations and
limited dividend housing corporations engaged in
9 construction or
rehabilitation under this subsection to utilize
10 the labor of
prospective individual purchasers of low or moderate
11 income in the
construction or rehabilitation of the housing units
12 involved. The value
of the labor of the prospective purchasers
13 so utilized shall be
used to reduce the project costs of the
14 housing units
involved.
15 (f) In the
construction of housing units to be sold to the
16 individual purchasers
of low or moderate income at a price not to
17 exceed $12,000.00, the
individual purchasers may be required to
18 perform, in a manner
and under conditions to be specified by the
19 authority in its
rules, a minimum number of hours of labor. The
20 value of the labor
shall be credited to the purchase price.
21 (3) The authority may
make, or purchase, or participate in
22 loans made to an individual
purchaser purchasers for
23 acquisition and long-term
financing of a newly rehabilitated,
24 newly constructed, or
existing 1- to 4-unit housing unit units,
25 including a residential condominium unit as defined in section 4
26 of the condominium act, 1978 PA 59, MCL 559.104. To qualify, all
27 of the following apply:
1 (a) The
borrower's family income shall not exceed either of
2 the following:
3 (i) If the housing unit is located in a metropolitan
area,
4 $52,900.00 on or
before November 1, 2001, $54,750.00 from
5 November 2, 2001 until
November 1, 2002, and $56,650.00 on and
6 after November 1,
2002.
7 (ii) If the housing unit is located in a nonmetropolitan
8 area, $43,575.00 on or
before November 1, 2002. After November
9 1, 2002, the family
income limit increases to the lesser of the
10 HUD nonmetropolitan
median income or $44,000.00.
11 (b) The purchase
price with respect to the unit does not
12 exceed the following:
13 (i) For an existing housing unit, $99,000.00 on or
before
14 November 1, 2001,
$102,000.00 from November 2, 2001 until
15 November 1, 2002, and
$105,000.00 on and after November 1, 2002.
16 (ii) For a newly rehabilitated or a newly constructed
housing
17 unit, $120,000.00 on
or before November 1, 2001, $124,000.00 from
18 November 2, 2001 until
November 1, 2002, and $128,000.00 on and
19 after November 1,
2002.
20 (a) The borrower's family income shall not exceed the
21 following:
22 (i) For eligible distressed areas, 115% of state median
23 income, as established from time to time by the United States
24 secretary of the treasury pursuant to section 143(f) of the
25 internal revenue code, 26 USC 143(f).
26 (ii) For any other area, 100% of state median income, as
27 established from time to time by the United States secretary of
1 the treasury pursuant to section 143(f) of the internal revenue
2 code, 26 USC 143(f).
3 (b) The purchase price does not exceed the following:
4 (i) With respect to a 1- or 2-family unit, 3 times the income
5 limit, as established from time to time by the United States
6 secretary of the treasury pursuant to section 143(f) of the
7 internal revenue code, 26 USC 143(f).
8 (ii) With respect to a 3-family unit, 3-1/2 times the income
9 limit, as established from time to time by the United States
10 secretary of the treasury pursuant to section 143(f) of the
11 internal revenue code, 26 USC 143(f).
12 (iii) With respect to a 4-family unit, 4 times the income
13 limit, as established from time to time by the United States
14 secretary of the treasury pursuant to section 143(f) of the
15 internal revenue code, 26 USC 143(f).
16 (c) For unexpected cost increases during construction or
17 improvements to adapt new or existing property for use by
18 disabled individuals, the authority may increase the purchase
19 price limit by an amount sufficient to cover these cost
20 increases, but not to exceed $3,500.00.
21 (d) If an income or purchase price limit prescribed by this
22 subsection exceeds an application limit prescribed by the
23 internal revenue code,
of 1986, the internal revenue code of
24 1986 limit applies.
25 (e) Except with respect to newly constructed housing units,
26 the authority may by resolution establish, for a length of time
27 the authority considers appropriate, maximum borrower income or
1 purchase price limits more restrictive than those maximum
2 limitations set forth in this section. The authority shall
3 advise the appropriate house and senate standing committees 5
4 days prior to adopting a resolution establishing more restrictive
5 maximum borrower income or purchase price limits.
6 (f) Before making a loan under this section, authority staff
7 shall determine that the borrower has the ability to repay the
8 loan.
9 (g) A loan made or purchased to finance the acquisition of an
10 existing housing unit may include funds for rehabilitation.
11 (4) A loan shall be secured in a manner and be repaid in a
12 period, not exceeding 50 years, as may be determined by the
13 authority. A loan shall bear interest at a rate determined by
14 the authority.
15 (5) A person who, for purposes of securing a loan under this
16 act, misrepresents his or her income, including taking a leave of
17 absence from his or her employment for purposes of diminishing
18 his or her income, is not to be eligible for a loan under this
19 act.
20 Sec. 44a. (1) The authority may make, purchase, or
21 participate in loans, grants, or deferred payment loans to
22 persons and families of low and moderate income to finance the
23 rehabilitation of residential real property designed for
24 occupancy by not more
than 11 24 families that is owned or is
25 being purchased by 1 or more persons or families of low and
26 moderate income and that is for occupancy by persons or families
27 of low and moderate income.
1 (2) The authority, without regard to the income of the owners
2 or occupants of residential rental property, may make, purchase,
3 or participate in loans, grants, or deferred payment loans for
4 the rehabilitation of residential rental property to persons or
5 entities owning residential rental property located in areas of
6 chronic economic distress and moderate cost residential rental
7 property located elsewhere in this state.
8 (3) A loan under this section may be secured or unsecured as
9 determined by the authority. If the loan is unsecured, it shall
10 be accepted for insurance under title 1 of the national housing
11 act, chapter 847, 48
Stat. 1246, 12 U.S.C. USC 1702, 1703,
12 1705, and 1706b to 1706d, or another federal or private insurance
13 program providing coverage at least equal to that provided by
14 that title, or the authority shall establish a reserve for losses
15 on uninsured loans made under this section and shall deposit into
16 that reserve an amount equal to 5% of the principal amount of
17 each such uninsured loan on or before the making of the loan.
18 Money may be withdrawn by the authority from this reserve for
19 application as loan repayments in connection with loans that are
20 delinquent. In addition, upon repayment of a loan made,
21 purchased, or participated in under this section, the authority
22 may withdraw the amount deposited in the reserve in connection
23 with that loan, reduced by amounts withdrawn as loan repayments
24 in connection with the loan, and may apply the amounts to any of
25 the authority's programs and purposes. Income or interest earned
26 by or increment to the reserve due to the investment of the money
27 in the reserve may, at the times determined by the authority, be
1 transferred by the authority to other funds or accounts of the
2 authority and applied to any of the corporate purposes of the
3 authority. A loan under this section shall bear interest at a
4 rate and be repaid in the period, not exceeding 20 years, as
5 determined by the authority and under additional terms and
6 conditions as determined by the authority.
7 (4) A deferred payment loan or grant may be secured or
8 unsecured as determined by the authority, and shall be made under
9 additional terms and conditions determined by the authority.
10 (5) In recognition of the need for rehabilitation loans,
11 grants, and deferred payment loans in all geographic areas of the
12 state, the authority shall promulgate rules that provide for the
13 availability of loans, grants, and deferred payment loans on an
14 equitable basis to qualified applicants in all geographic areas
15 of this state. With respect to loans, grants, and deferred
16 payment loans made pursuant to this section that are not based on
17 residency in a neighborhood selected under section 22a(5),
18 eligibility for loans, grants, or deferred payment loans shall
19 not be based upon the number of qualified applicants in the
20 geographic area in which the individual resides.
21 (6) For purposes of this section, persons and families of low
22 and moderate income means persons and families whose family
23 income does not exceed either
of the following:
24 (a) If the
housing unit is located in a metropolitan area,
25 $52,900.00 on or
before November 1, 2001, $54,750.00 from
26 November 2, 2001 until
November 1, 2002, and $56,650.00 on and
27 after November 1,
2002.
1 (b) If the housing
unit is located in a nonmetropolitan area,
2 $43,575.00 on or
before November 1, 2002. After November 1,
3 2002, the family
income limit increases to the lesser of the HUD
4 nonmetropolitan median
income or $44,000.00. The authority may
5 by resolution
establish, for a length of time it considers
6 appropriate, maximum
family income limits more restrictive than
7 those maximum
limitations set forth in this section. The
8 authority shall advise
the appropriate house and senate standing
9 committees 5 days
prior to the adoption of a resolution
10 establishing more
restrictive maximum family income limits.
11 (a) For eligible distressed areas, 115% of state median
12 income, as established from time to time by the United States
13 secretary of the treasury pursuant to section 143(f) of the
14 internal revenue code, 26 USC 143(f).
15 (b) For any other area, 100% of state median income, as
16 established from time to time by the United States secretary of
17 the treasury pursuant to section 143(f) of the internal revenue
18 code, 26 USC 143(f).
19 (7) The maximum principal loan amounts for home improvement
20 loans, exclusive of finance charges, are as follows:
21 (a) $25,000.00 $50,000.00
for a residential structure
22 containing 1 dwelling unit, unless the loan is made in
23 conjunction with additional money provided by a municipality or
24 nonprofit community-based organization, in which case a loan for
25 a residential structure containing 1 dwelling unit is
26 $35,000.00.
27 (b) $15,000.00 $25,000.00
per dwelling unit for a
1 residential structure
containing 2 to 11 24 dwelling units.
2 (8) A structure is not required to be of a minimum age to be
3 eligible for rehabilitation under this section.
4 Enacting section 1. This amendatory act does not take
5 effect unless Senate Bill No. 1341 or House Bill No. _____
6 (request no. 06557'04) of the 92nd Legislature is enacted into
7 law.