HOUSE BILL No. 5617

 

May 10, 2012, Introduced by Reps. Zorn, Shaughnessy and Wayne Schmidt and referred to the Committee on Commerce.

 

     A bill to amend 1966 PA 346, entitled

 

"State housing development authority act of 1966,"

 

by amending section 44a (MCL 125.1444a), as amended by 2004 PA 549.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 44a. (1) The authority may make, purchase, or participate

 

in loans, grants, or deferred payment loans to persons and families

 

of low and moderate income to finance the rehabilitation of

 

residential real property designed for occupancy by not more than

 

24 families that is owned or is being purchased by 1 or more

 

persons or families of low and moderate income and that is for

 

occupancy by persons or families of low and moderate income.

 

     (2) The authority, without regard to the income of the owners

 

or occupants of residential rental property, may make, purchase, or

 

participate in loans, grants, or deferred payment loans for the

 

rehabilitation of residential rental property to persons or


 

entities owning residential rental property located in areas of

 

chronic economic distress and or moderate cost residential rental

 

property located elsewhere in this state.

 

     (3) A loan under this section may be secured or unsecured as

 

determined by the authority. If the loan is unsecured, it shall be

 

accepted for insurance under title 1 of the national housing act,

 

12 USC 1702 , 1703, 1705, and 1706b to 1706d, to 1706f, or another

 

federal or private insurance program providing coverage at least

 

equal to that provided by that title, or the authority shall

 

establish a reserve for losses on uninsured loans made under this

 

section and shall deposit into that reserve an amount equal to 5%

 

of the principal amount of each such uninsured loan on or before

 

the making of the loan. Money may be withdrawn by the authority

 

from this reserve for application as loan repayments in connection

 

with loans that are delinquent. In addition, upon repayment of a

 

loan made, purchased, or participated in under this section, the

 

authority may withdraw the amount deposited in the reserve in

 

connection with that loan, reduced by amounts withdrawn as loan

 

repayments in connection with the loan, and may apply the amounts

 

to any of the authority's programs and corporate purposes. Income

 

or interest earned by or increment to the reserve due to the

 

investment of the money in the reserve may, at the times determined

 

by the authority, be transferred by the authority to other funds or

 

accounts of the authority and applied to any of the authority's

 

corporate purposes. of the authority. A loan under this section

 

shall bear interest at a rate and be repaid in the period, not

 

exceeding 20 30 years, as determined by the authority and under


 

additional terms and conditions as determined by the authority.

 

     (4) A deferred payment loan or grant may be secured or

 

unsecured as determined by the authority, and shall be made under

 

additional terms and conditions determined by the authority.

 

     (5) In recognition of the need for rehabilitation loans,

 

grants, and deferred payment loans in all geographic areas of the

 

state, the The authority shall promulgate rules that provide for

 

the availability of loans, grants, and deferred payment loans on an

 

equitable basis to qualified applicants in all geographic areas of

 

this state. With respect to loans, grants, and deferred payment

 

loans made pursuant to this section that are not based on residency

 

in a neighborhood selected under pursuant to section 22a(5),

 

eligibility for loans, grants, or deferred payment loans shall not

 

be based upon the number of qualified applicants in the geographic

 

area in which the individual resides.

 

     (6) For purposes of this section, persons and families of low

 

and moderate income means persons and families whose family income

 

does not exceed the following:175% of the statewide median gross

 

income as determined under section 143 of the internal revenue

 

code, 26 USC 143.

 

     (a) For eligible distressed areas, $69,800.00 until June 1,

 

2006, $72,250.00 until November 1, 2007, and $74,750.00 on and

 

after November 1, 2007.

 

     (b) For any other area, $60,700.00 until June 1, 2006,

 

$62,800.00 until November 1, 2007, and $65,000.00 on and after

 

November 1, 2007.

 

     (7) The maximum principal loan amounts for home improvement


 

residential property rehabilitation loans, exclusive of finance

 

charges, are as follows:

 

     (a) $50,000.00 for a residential structure containing 1

 

dwelling unit. , unless the loan is made in conjunction with

 

additional money provided by a municipality or nonprofit community-

 

based organization, in which case a loan for a residential

 

structure containing 1 dwelling unit is $35,000.00.

 

     (b) $25,000.00 per dwelling unit for a residential structure

 

containing 2 to 24 dwelling units.

 

     (8) A structure is not required to be of a minimum age to be

 

eligible for rehabilitation under this section.