Affordability Restrictions. A. Real property acquired and/or improved for a homebuyer project by use of loan funds approved by the Subrecipient or its subrecipient are subject to recapture provisions per 24 CFR 92.254(4) and limit any Sub-grantee or homebuyers rights to dispose of said property or to utilize it for a purpose other than that specified in this Agreement, for a minimum period of time as indicated below. This provision will be implemented through a Deed of Trust from the homebuyer in favor of the Subrecipient per the stated schedule below, placed on the property at the time any assistance to a sub-grantee or homebuyer is provided. Any circumstances affecting that property other than those stated in Sub- grantee’s application for funding shall require the specific approval of the City of Tacoma. In the event of a proposed change of use or ownership, Subrecipient shall contact the City for appropriate disposition of this provision. Homeowner Rehabilitation Any Amount No minimum HOME term Homebuyer Assistance $-0- to $14,999 5 Years $15,000 to 39,999 10 Years $40,000 and higher 15 Years B. The City of Tacoma uses the recapture provision to recapture the direct HOME assistance to homebuyers receiving funding through a down payment assistance program or its homeownership development programs. Developers, subrecipients, owners and/or sponsors of HOME homebuyer projects cannot choose their own recapture options. HOME funds will not be provided as a development subsidy only; a direct subsidy loan will be required with each HOME eligible homebuyer. If the HOME- assisted homebuyer sells the HOME-assisted unit during the relevant period of affordability, the Subrecipient will recapture the entire amount of the HOME subsidy to the homebuyer as defined in 24 CFR 92.254(a)(4). If there are no net proceeds from a sale, or the net proceeds from a sale are insufficient to repay the HOME investment due, the Subrecipient or its subrecipient will only recapture the amount of net proceeds available, if any. Net proceeds shall be defined as the sales price minus superior loan repayment (other than HOME funds) and standard closing costs. Under no circumstances will the Subrecipient recapture more than is available from the net proceeds of the sale. C. Real property acquired and/or improved for a rental housing project by use of loan funds provided by the Subrecipient to an owner/developer/sponsor is subject to the affordability restrictions under 24 CFR 92.252 indicated below. The affordability restrictions will be secured by a Note, Deed of Trust and Affordability Covenant between the Subrecipient and the Owner of the HOME-assisted housing project. D. Disposition of real property by the Subrecipient acquired in whole or in part with HOME funds shall be at current appraised fair market value. The property may be disposed of for lesser value, including donated, if the disposition at the lesser value is necessary to meet one of HUD’s national objections and is permissible under state and local law. When disposition is for a lesser value, or if the Subrecipient should determine that disposition for such lesser value is in the best interest of the program, those reasons shall be fully documented. E. The Subrecipient will be required to repay to the City all HOME funds expended on housing projects that are determined not to have met the affordability requirements for the duration of the affordability period, except for: 1. Homebuyer assistance subject to recapture; and 2. Any direct subsidy provided to a sub-grantee in connection with a homebuyer assistance project. F. Non-expendable equipment, materials, operating supplies, and other assets other than real property, purchased in whole or in part with HOME funds, whose per unit fair market value (or total value for supplies) at the time of completion of use is in excess of $5,000.00, are the property of the City and are to be utilized, maintained, inventoried, controlled and disposed of, pursuant to applicable federal regulations. G. The Subrecipient shall be responsible for loss or damage to all such equipment, materials, operating supplies and other assets in its care and, after completion of use, shall return all such equipment, materials and assets to the City for disposition within thirty (30) days following completion of the project, unless otherwise specified. H. If such equipment, materials, operating supplies or assets are partially funded from other sources, the City shall share any funds received as a result of said disposition, at the percentage of value received equal to the percentage of the original costs provided by the individual funding sources. I. Any equipment, materials, operating supplies and other assets with per unit fair market value (or total value for supplies) at the time of completion of less than $5,000.00 may be retained or disposed of by the Subrecipient. The City retains no financial interest in these items. Any assets whose fair market value is in question should be referred to the City for decision before any disposition action is taken by the Subrecipient.
Appears in 1 contract
Sources: CDBG Program Agreement
Affordability Restrictions. A. Real property acquired and/or improved for a homebuyer project by use of loan funds approved by the Subrecipient or its subrecipient are subject to recapture provisions per 24 CFR 92.254(4) and limit any Sub-grantee or homebuyers rights to dispose of said property or to utilize it for a purpose other than that specified in this Agreement, for a minimum period of time as indicated below. This provision will be implemented through a Deed of Trust from the homebuyer in favor of the Subrecipient per the stated schedule below, placed on the property at the time any assistance to a sub-grantee or homebuyer is provided. Any circumstances affecting that property other than those stated in Sub- grantee’s application for funding shall require the specific approval of the City of Tacoma. In the event of a proposed change of use or ownership, Subrecipient shall contact the City for appropriate disposition of this provision. Homeowner Rehabilitation Any Amount No minimum HOME term Homebuyer Assistance $-0- to $14,999 5 Years $15,000 to 39,999 10 Years $40,000 and higher 15 Years
B. The City of Tacoma uses the recapture provision to recapture the direct HOME assistance to homebuyers receiving funding through a down payment assistance program or its homeownership development programs. Developers, subrecipients, owners and/or sponsors of HOME homebuyer projects cannot choose their own recapture options. HOME funds will not be provided as a development subsidy only; a direct subsidy loan will be required with each HOME eligible homebuyer. If the HOME- assisted homebuyer sells the HOME-assisted unit during the relevant period of affordability, the Subrecipient will recapture the entire amount of the HOME subsidy to the homebuyer as defined in 24 CFR 92.254(a)(4). If there are no net proceeds from a sale, or the net proceeds from a sale are insufficient to repay the HOME investment due, the Subrecipient or its subrecipient will only recapture the amount of net proceeds available, if any. Net proceeds shall be defined as the sales price minus superior loan repayment (other than HOME funds) and standard closing costs. Under no circumstances will the Subrecipient recapture more than is available from the net proceeds of the sale.
C. Real property acquired and/or improved for a rental housing project by use of loan funds provided by the Subrecipient to an owner/developer/sponsor is subject to the affordability restrictions under 24 CFR 92.252 indicated below. The affordability restrictions will be secured by a Note, Deed of Trust and Affordability Covenant between the Subrecipient and the Owner of the HOME-assisted housing project.
D. Disposition of real property by the Subrecipient acquired in whole or in part with HOME funds shall be at current appraised fair market value. The property may be disposed of for lesser value, including donated, if the disposition at the lesser value is necessary to meet one of HUD’s national objections and is permissible under state and local law. When disposition is for a lesser value, or if the Subrecipient should determine that disposition for such lesser value is in the best interest of the program, those reasons shall be fully documented.
E. The Subrecipient will be required to repay to the City all HOME funds expended on housing projects that are determined not to have met the affordability requirements for the duration of the affordability period, except for:
1. Homebuyer assistance subject to recapture; and
2. Any direct subsidy provided to a sub-grantee in connection with a homebuyer assistance project.
F. Non-expendable equipment, materials, operating supplies, and other assets other than real property, purchased in whole or in part with HOME funds, whose per unit fair market value (or total value for supplies) at the time of completion of use is in excess of $5,000.00, are the property of the City and are to be utilized, maintained, inventoried, controlled and disposed of, pursuant to applicable federal regulations.
G. The Subrecipient shall be responsible for loss or damage to all such equipment, materials, operating supplies and other assets in its care and, after completion of use, shall return all such equipment, materials and assets to the City for disposition within thirty (30) days following completion of the project, unless otherwise specified.
H. If such equipment, materials, operating supplies or assets are partially funded from other sources, the City shall share any funds received as a result of said disposition, at the percentage of value received equal to the percentage of the original costs provided by the individual funding sources.
I. Any equipment, materials, operating supplies and other assets with per unit fair market value (or total value for supplies) at the time of completion of less than $5,000.00 may be retained or disposed of by the Subrecipient. The City retains no financial interest in these items. Any assets whose fair market value is in question should be referred to the City for decision before any disposition action is taken by the Subrecipient.
Appears in 1 contract
Sources: Home Subrecipient Agreement