42 U.S.C. § 1437z-7 : US Code - Section 1437Z-7: Mixed-finance public housing

Search 42 U.S.C. § 1437z-7 : US Code - Section 1437Z-7: Mixed-finance public housing

(a) Authority
A public housing agency may own, operate, assist, or otherwise
participate in 1 or more mixed-finance projects in accordance with
this section.
(b) Assistance
(1) Forms
A public housing agency may provide to a mixed-finance project
assistance from the Operating Fund under section 1437g of this
title, assistance from the Capital Fund under such section, or
both forms of assistance. A public housing agency may, in
accordance with regulations established by the Secretary, provide
capital assistance to a mixed-finance project in the form of a
grant, loan, guarantee, or other form of investment in the
project, which may involve drawdown of funds on a schedule
commensurate with construction draws for deposit into an interest-
bearing escrow account to serve as collateral or credit
enhancement for bonds issued by a public agency, or for other
forms of public or private borrowings, for the construction or
rehabilitation of the development.
(2) Use
To the extent deemed appropriate by the Secretary, assistance
used in connection with the costs associated with the operation
and management of mixed-finance projects may be used for funding
of an operating reserve to ensure affordability for low-income
and very low-income families in lieu of the availability of
operating funds for public housing units in a mixed-finance
project.
(c) Compliance with public housing requirements
The units assisted with capital or operating assistance in a
mixed-finance project shall be developed, operated, and maintained
in accordance with the requirements of this chapter relating to
public housing during the period required by under (!1) this
chapter, unless otherwise specified in this section. For purposes
of this chapter, any reference to public housing owned or operated
by a public housing agency shall include dwelling units in a mixed
finance project that are assisted by the agency with capital or
operating assistance.
(d) Mixed-finance projects
(1) In general
For purposes of this section, the term "mixed-finance project"
means a project that meets the requirements of paragraph (2) and
is financially assisted by private resources, which may include
low-income housing tax credits, in addition to amounts provided
under this chapter.
(2) Types of projects
The term includes a project that is developed -
(A) by a public housing agency or by an entity affiliated
with a public housing agency;
(B) by a partnership, a limited liability company, or other
entity in which the public housing agency (or an entity
affiliated with a public housing agency) is a general partner,
managing member, or otherwise participates in the activities of
that entity;
(C) by any entity that grants to the public housing agency
the right of first refusal and first option to purchase, after
the close of the compliance period, of the qualified low-income
building in which the public housing units exist in accordance
with section 42(i)(7) of title 26; or
(D) in accordance with such other terms and conditions as the
Secretary may prescribe by regulation.
(e) Structure of projects
Each mixed-finance project shall be developed -
(1) in a manner that ensures that public housing units are made
available in the project, by regulatory and operating agreement,
master contract, individual lease, condominium or cooperative
agreement, or equity interest;
(2) in a manner that ensures that the number of public housing
units bears approximately the same proportion to the total number
of units in the mixed-finance project as the value of the total
financial commitment provided by the public housing agency bears
to the value of the total financial commitment in the project, or
shall not be less than the number of units that could have been
developed under the conventional public housing program with the
assistance, or as may otherwise be approved by the Secretary; and
(3) in accordance with such other requirements as the Secretary
may prescribe by regulation.
(f) Taxation
(1) In general
A public housing agency may elect to exempt all public housing
units in a mixed-finance project -
(A) from the provisions of section 1437d(d) of this title,
and instead subject such units to local real estate taxes; and
(B) from the finding of need and cooperative agreement
provisions under section 1437c(e)(1)(ii) and 1437c(e)(2) of
this title, but only if the development of the units is not
inconsistent with the jurisdiction's comprehensive housing
affordability strategy.
(2) Low-income housing tax credit
With respect to any unit in a mixed-finance project that is
assisted pursuant to the low-income housing tax credit under
section 42 of title 26, the rents charged to the residents may be
set at levels not to exceed the amounts allowable under that
section, provided that such levels for public housing residents
do not exceed the amounts allowable under section 1437a of this
title.
(g) Use of savings
Notwithstanding any other provision of this chapter, to the
extent deemed appropriate by the Secretary, to facilitate the
establishment of socioeconomically mixed communities, a public
housing agency that uses assistance from the Capital Fund for a
mixed-finance project, to the extent that income from such a
project reduces the amount of assistance used for operating or
other costs relating to public housing, may use such resulting
savings to rent privately developed dwelling units in the
neighborhood of the mixed-finance project. Such units shall be made
available for occupancy only by low-income families eligible for
residency in public housing.
(h) Effect of certain contract terms
If an entity that owns or operates a mixed-finance project, that
includes a significant number of units other than public housing
units enters into a contract with a public housing agency, the
terms of which obligate the entity to operate and maintain a
specified number of units in the project as public housing units in
accordance with the requirements of this chapter for the period
required by law, such contractual terms may provide that, if, as a
result of a reduction in appropriations under section 1437g of this
title or any other change in applicable law, the public housing
agency is unable to fulfill its contractual obligations with
respect to those public housing units, that entity may deviate,
under procedures and requirements developed through regulations by
the Secretary, from otherwise applicable restrictions under this
chapter regarding rents, income eligibility, and other areas of
public housing management with respect to a portion or all of those
public housing units, to the extent necessary to preserve the
viability of those units while maintaining the low-income character
of the units to the maximum extent practicable.