PRIA, Government Policy, Made Personal

Summary

When the calculated preservation rents for low-income housing go above the federal cost limit, the owner must offer the property for sale to qualified buyers. For 12 months after the Secretary gets the second notice of intent, the owner may only sell to priority purchasers. If a priority purchaser makes a real offer at or above the preservation value, the Secretary must make the owner accept that offer. Priority purchasers can send a written notice saying they are interested, and within 30 days the Secretary must tell them what federal help is available while the owner must share information about the property. If no qualifying offer is made in those 12 months, the owner then has a 3-month period to sell only to other qualified purchasers under the same price rule. Subject to available funds, the Secretary must provide federal financial help equal to 120% of local rents times the number of units and may give gap grants and aid to get state or local funding and tax relief.

Title 12, §4111

Banks and Banking, Source: USLM XML via OLRC

(a)In general

With respect to any eligible low-income housing for which the aggregate preservation rents determined under section 4104(b) of this title exceed the Federal cost limit, the owner shall offer the housing for sale to qualified purchasers as provided in this section.

(b)Right of first refusal to priority purchasers

(1)Duration and required sale

For the 12-month period beginning upon the receipt by the Secretary of the second notice of intent under section 4106(d) of this title with respect to such housing, the owner of the housing may offer to sell and may sell the housing only to priority purchasers. If, during such period, a priority purchaser makes a bona fide offer to purchase the housing for a sale price not less than the preservation value of the housing determined under section 4103(b)(2) of this title, the Secretary shall require the owner to sell the housing pursuant to such offer.

(2)Expression of interest

During the period under paragraph (1), priority purchasers shall have the opportunity to submit written notice to the owner and the Secretary stating their interest in acquiring the housing. Such written notice shall be in such form and include such information as the Secretary may prescribe.

(3)Information from Secretary

Not later than 30 days after receipt of any notice under paragraph (2), the Secretary shall provide such purchaser with information on the assistance available from the Federal Government to facilitate a transfer and the owner shall provide such purchaser with appropriate information on the housing, as determined by the Secretary.

(c)Right of refusal for other qualified purchasers

If no bona fide offer to purchase any eligible low-income housing subject to this section that meets the requirements of subsection (b) is made during the period under such subsection, during the 3-month period beginning upon the expiration of the 12-month period under subsection (b)(1), the owner of the housing may offer to sell and may sell the housing only to qualified purchasers. If, during such period, a qualified purchaser makes a bona fide offer to purchase the housing for a sale price not less than the preservation value of the housing determined under section 4103(b)(2) of this title, the Secretary shall require the owner to sell the housing pursuant to such offer.

(d)Assistance

(1)Federal cost limit

Subject to the availability of amounts approved in appropriations Acts, the Secretary shall, for approvable plans of action, provide to qualified purchasers assistance under section 1437f of title 42 sufficient to produce a gross income potential equal to the amount determined by multiplying 120 percent of the prevailing rents in the relevant local market area in which the housing is located by the number of units in the project (according to appropriate unit sizes), and any other incentives authorized under section 4109(b) of this title that would have been provided to a qualified purchaser under section 4110 of this title.

(2)Additional assistance

From amounts made available under section 4124(b) of this title, the Secretary may make grants to assist in the completion of sales and transfers under this section to any qualified purchasers. Any grant under this paragraph shall be in an amount not exceeding the difference between the preservation value for the housing (determined under section 4103(b)(2) of this title) and the level of assistance under paragraph (1) of this subsection.

(3)Securing State and local funding

The Secretary shall assist any qualified purchaser of such housing in securing funding and other assistance (including tax and assessment reductions) from State and local governments to facilitate a sale under this section.

Editorial Notes

Amendments

1992—Subsec. (c). Pub. L. 102–550 substituted “than” for “that” before “the preservation”.

§4111 Mandatory Sale for Housing Exceeding Federal Cost Limits

Summary

Title 12, §4111

Notes & Related Subsidiaries

Editorial Notes

Amendments

Citations & Metadata