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Chapter 3.2. The Joe Serna, Jr. Farmworker Housing Grant Program of California Health And Safety Code >> Division 31. >> Part 2. >> Chapter 3.2.
(a) Notwithstanding any other law, the department may
extend the term of an existing multifamily housing loan made by the
department under the original Rental Housing Construction Program
established by Chapter 9 (commencing with Section 50735), the Special
User Housing Rehabilitation Program established by Section 50670, or
the Deferred Payment Rehabilitation Loan Program established by
Chapter 6.5 (commencing with Section 50660) upon the request of any
borrower subject to the following conditions:
(1) The borrower shall provide to the department a complete report showing all existing tenants, their incomes, as reported in the most recent annual income certification, and the rents currently charged to each tenant.
(2) The borrower shall agree to an extension of the term of the loan by an additional 55 years from the date of departmental approval. If the department determines that the remaining useful life of a project is less than 55 years, the loan may be extended for the remaining useful life of the project, but not less than 30 years. The department may convert the existing outstanding principal and any accrued interest into the new loan amount. The interest rate on the extended term shall be 3 percent simple interest. All future payments of principal and interest may be deferred except for a percentage of interest equal to the percentage charged in the Multifamily Housing Program (Chapter 6.7 (commencing with Section 50675)) for the department's ongoing monitoring and management responsibilities.
(3) The borrower shall agree to amend or replace the existing regulatory agreement to include terms generally equivalent to those used in the Multifamily Housing Program. In addition, the borrower shall agree to replace, amend, or revise any other loan document as necessary to accomplish the purposes of this section.
(4) (A) The borrower shall agree to a rent schedule that ensures that all assisted units are affordable to households earning no more than 60 percent of the area median income and that at least 35 percent of all assisted units shall be reserved for, affordable to, and occupied by, households earning less than or equal to the midlevel target used by the Multifamily Housing Program, unless the department finds both of the following:
(i) That the project income is insufficient to maintain fiscal integrity, as that term is used in the Multifamily Housing Program, and is insufficient to maintain the rents required under this subparagraph pursuant to the terms of the Uniform Multifamily Regulations, or any successor regulations, except that commercial vacancy loss shall be projected based on the operating history of the project, commercial vacancy rates in the neighborhood, and similar factors typically used by commercial lenders.
(ii) That the borrower has exhausted all available potential sources of rental subsidies, including, but not limited to, federal, state, and local funds.
(B) If the department finds that a reduction in the percentage of assisted units to less than 35 percent of assisted units is justified, it shall ensure that the largest possible percentage is reserved for the targeted households.
(C) For the purposes of this paragraph, "midlevel target used by the Multifamily Housing Program" shall mean the following:
(i) For counties with an area median income of 110 percent or less of the state median income, it shall mean households earning 30 percent of state median income, expressed as a percentage of area median income.
(ii) For counties with an area median income that exceeds 110 percent of the state median income, it shall mean households earning less than 35 percent of state median income, expressed as a percentage of area median income.
(5) No tenant residing in a project at the time of an extension authorized by this section may be displaced as a result of the regulatory revisions authorized by this section, and, for the initial operating year after approval of the extension, that tenant may not have his or her rent increased above the amounts specified in his or her preexisting regulatory agreements, except that no tenant may pay less than 30 percent of his or her income, calculated pursuant to the Multifamily Housing Program criteria. If a rent increase authorized under this section would exceed a 10 percent increase in payment for a lower income tenant, the project owner shall phase in the increase so that it does not exceed 10 percent per year. After the initial operating year after the extension authorized under this section, the rents for all regulated units that are subject to the new agreement may be adjusted in the percentage calculated pursuant to the Multifamily Housing Program criteria, plus the amount necessary to bring an individual tenant up to the 30-percent-of-income standard, provided that the total annual increase does not exceed 10 percent. Rent adjustments for all tenants occupying assisted units at the time of the extension shall be based on the tenant's initial rent established under this paragraph. Upon vacancy of an assisted unit occupied at the time of the extension, the new base rent for that unit shall be established consistent with the standards used in the Multifamily Housing Program for the regulated income band, subject to the reservation of units required under paragraph (4).
(b) The department may approve an extension of a loan made by the department if it determines that the project has, or will have after rehabilitation or repairs, a potential remaining useful life of at least 30 years and that the project is deemed financially feasible pursuant to the terms of its Uniform Multifamily Regulations or successor regulations.
(c) The department may subordinate its loan or loans to refinance existing senior debt and to additional permanent financing if that additional senior debt is used only for rehabilitation, repairs, or improvements, or both, including related soft costs, that are modest in size, scope, and cost, as determined by the department and necessary to maintain and extend the useful life of the project.
(d) (1) For the purposes of this subdivision, the "agency projects" are the 26 projects assisted through the original Rental Housing Construction Program with funds administered by the California Housing Finance Agency.
(2) Upon the request of a borrower the agency may extend the term of an existing loan for an agency project by a period that is equal to the remaining useful life of the project, as determined by the agency, but not more than 55 years and not less than 30 years from the date of agency approval, under terms that are substantially consistent with the purposes of this section, if all of the following conditions are met:
(A) The borrower shall provide to the agency the report described in paragraph (1) of subdivision (a).
(B) The extension shall be subject to the conditions set forth in paragraph (2) of subdivision (a).
(C) The rent levels and tenant protections described in paragraphs (4) and (5) of subdivision (a) shall be satisfied, except that the agency, not the department, shall make the determination required under clause (i) of subparagraph (A) of paragraph (4) of subdivision (a) that the project income is insufficient to meet the agency's affordable multifamily lending program requirements.
(3) Any determination or approval under this section regarding the agency projects shall be by the agency rather than the department.
(4) The borrower and the agency shall amend, replace, or revise any other loan documents or agreements governing the loans for the agency projects as necessary to accomplish the purposes of this section.
(5) All funds received by the agency for the agency projects, whether by loan repayment, foreclosure, accrued interest, or otherwise, shall be used to provide assistance to existing or future projects financed by or through the agency pursuant to terms consistent with the agency's affordable multifamily lending programs.
(e) It is the intent of the Legislature in enacting this section that the department should manage its reserves for the original Rental Housing Construction Program in a manner that will allow for the continuation of current benefits to current low-income tenants for the longest period of time possible. Accordingly, rent subsidies shall be continued only for units occupied by lower income tenants who were in residence at the time of the extension authorized under this section.
(f) It is the intent of the Legislature in enacting this section to provide to the department the flexibility necessary to preserve the affordable rental units for which the state has already made a significant public investment. Accordingly, the department may implement this section through guidelines that shall not be subject to Chapter 2.5 (commencing with Section 11340) of Part 1 of Title 2 of the Government Code.
(g) This section shall become operative on July 1, 2008.
(h) This section shall not apply to loan extensions and senior debt subordinations executed by the department and recorded after the effective date of the guidelines adopted by the department pursuant to subdivision (h) of Section 50560.
(1) The borrower shall provide to the department a complete report showing all existing tenants, their incomes, as reported in the most recent annual income certification, and the rents currently charged to each tenant.
(2) The borrower shall agree to an extension of the term of the loan by an additional 55 years from the date of departmental approval. If the department determines that the remaining useful life of a project is less than 55 years, the loan may be extended for the remaining useful life of the project, but not less than 30 years. The department may convert the existing outstanding principal and any accrued interest into the new loan amount. The interest rate on the extended term shall be 3 percent simple interest. All future payments of principal and interest may be deferred except for a percentage of interest equal to the percentage charged in the Multifamily Housing Program (Chapter 6.7 (commencing with Section 50675)) for the department's ongoing monitoring and management responsibilities.
(3) The borrower shall agree to amend or replace the existing regulatory agreement to include terms generally equivalent to those used in the Multifamily Housing Program. In addition, the borrower shall agree to replace, amend, or revise any other loan document as necessary to accomplish the purposes of this section.
(4) (A) The borrower shall agree to a rent schedule that ensures that all assisted units are affordable to households earning no more than 60 percent of the area median income and that at least 35 percent of all assisted units shall be reserved for, affordable to, and occupied by, households earning less than or equal to the midlevel target used by the Multifamily Housing Program, unless the department finds both of the following:
(i) That the project income is insufficient to maintain fiscal integrity, as that term is used in the Multifamily Housing Program, and is insufficient to maintain the rents required under this subparagraph pursuant to the terms of the Uniform Multifamily Regulations, or any successor regulations, except that commercial vacancy loss shall be projected based on the operating history of the project, commercial vacancy rates in the neighborhood, and similar factors typically used by commercial lenders.
(ii) That the borrower has exhausted all available potential sources of rental subsidies, including, but not limited to, federal, state, and local funds.
(B) If the department finds that a reduction in the percentage of assisted units to less than 35 percent of assisted units is justified, it shall ensure that the largest possible percentage is reserved for the targeted households.
(C) For the purposes of this paragraph, "midlevel target used by the Multifamily Housing Program" shall mean the following:
(i) For counties with an area median income of 110 percent or less of the state median income, it shall mean households earning 30 percent of state median income, expressed as a percentage of area median income.
(ii) For counties with an area median income that exceeds 110 percent of the state median income, it shall mean households earning less than 35 percent of state median income, expressed as a percentage of area median income.
(5) No tenant residing in a project at the time of an extension authorized by this section may be displaced as a result of the regulatory revisions authorized by this section, and, for the initial operating year after approval of the extension, that tenant may not have his or her rent increased above the amounts specified in his or her preexisting regulatory agreements, except that no tenant may pay less than 30 percent of his or her income, calculated pursuant to the Multifamily Housing Program criteria. If a rent increase authorized under this section would exceed a 10 percent increase in payment for a lower income tenant, the project owner shall phase in the increase so that it does not exceed 10 percent per year. After the initial operating year after the extension authorized under this section, the rents for all regulated units that are subject to the new agreement may be adjusted in the percentage calculated pursuant to the Multifamily Housing Program criteria, plus the amount necessary to bring an individual tenant up to the 30-percent-of-income standard, provided that the total annual increase does not exceed 10 percent. Rent adjustments for all tenants occupying assisted units at the time of the extension shall be based on the tenant's initial rent established under this paragraph. Upon vacancy of an assisted unit occupied at the time of the extension, the new base rent for that unit shall be established consistent with the standards used in the Multifamily Housing Program for the regulated income band, subject to the reservation of units required under paragraph (4).
(b) The department may approve an extension of a loan made by the department if it determines that the project has, or will have after rehabilitation or repairs, a potential remaining useful life of at least 30 years and that the project is deemed financially feasible pursuant to the terms of its Uniform Multifamily Regulations or successor regulations.
(c) The department may subordinate its loan or loans to refinance existing senior debt and to additional permanent financing if that additional senior debt is used only for rehabilitation, repairs, or improvements, or both, including related soft costs, that are modest in size, scope, and cost, as determined by the department and necessary to maintain and extend the useful life of the project.
(d) (1) For the purposes of this subdivision, the "agency projects" are the 26 projects assisted through the original Rental Housing Construction Program with funds administered by the California Housing Finance Agency.
(2) Upon the request of a borrower the agency may extend the term of an existing loan for an agency project by a period that is equal to the remaining useful life of the project, as determined by the agency, but not more than 55 years and not less than 30 years from the date of agency approval, under terms that are substantially consistent with the purposes of this section, if all of the following conditions are met:
(A) The borrower shall provide to the agency the report described in paragraph (1) of subdivision (a).
(B) The extension shall be subject to the conditions set forth in paragraph (2) of subdivision (a).
(C) The rent levels and tenant protections described in paragraphs (4) and (5) of subdivision (a) shall be satisfied, except that the agency, not the department, shall make the determination required under clause (i) of subparagraph (A) of paragraph (4) of subdivision (a) that the project income is insufficient to meet the agency's affordable multifamily lending program requirements.
(3) Any determination or approval under this section regarding the agency projects shall be by the agency rather than the department.
(4) The borrower and the agency shall amend, replace, or revise any other loan documents or agreements governing the loans for the agency projects as necessary to accomplish the purposes of this section.
(5) All funds received by the agency for the agency projects, whether by loan repayment, foreclosure, accrued interest, or otherwise, shall be used to provide assistance to existing or future projects financed by or through the agency pursuant to terms consistent with the agency's affordable multifamily lending programs.
(e) It is the intent of the Legislature in enacting this section that the department should manage its reserves for the original Rental Housing Construction Program in a manner that will allow for the continuation of current benefits to current low-income tenants for the longest period of time possible. Accordingly, rent subsidies shall be continued only for units occupied by lower income tenants who were in residence at the time of the extension authorized under this section.
(f) It is the intent of the Legislature in enacting this section to provide to the department the flexibility necessary to preserve the affordable rental units for which the state has already made a significant public investment. Accordingly, the department may implement this section through guidelines that shall not be subject to Chapter 2.5 (commencing with Section 11340) of Part 1 of Title 2 of the Government Code.
(g) This section shall become operative on July 1, 2008.
(h) This section shall not apply to loan extensions and senior debt subordinations executed by the department and recorded after the effective date of the guidelines adopted by the department pursuant to subdivision (h) of Section 50560.
(a) (1) The department shall establish the Joe Serna, Jr.
Farmworker Housing Grant Program under which, subject to the
availability of funds therefor, grants or loans, or both, shall be
made to local public entities, nonprofit corporations, limited
liability companies, and limited partnerships, for the construction
or rehabilitation of housing for agricultural employees and their
families or for the acquisition of manufactured housing as part of a
program to address and remedy the impacts of current and potential
displacement of farmworker families from existing labor camps,
mobilehome parks, or other housing. Under this program, grants or
loans, or both, may also be made for the cost of acquiring the land
and any building thereon in connection with housing assisted pursuant
to this section and for the construction and rehabilitation of
related support facilities necessary to the housing. In its
administration of this program, the department shall disburse grants
or loans, or both, to the local public entities, nonprofit
corporations, limited liability companies, or limited partnerships or
may, at the request of the local public entity, nonprofit
corporation, limited liability company, or limited partnership that
sponsors and supervises the rehabilitation or construction program,
disburse grant funds to agricultural employees who are participants
in a rehabilitation or construction program sponsored and supervised
by the local public entity, nonprofit corporation, limited liability
company, or limited partnership. No part of a grant or loan made
pursuant to this section may be used for project organization or
planning.
(2) Notwithstanding any other provision of this chapter, upon the request of a grantee the program also may loan funds to a grantee at no more than 3 percent simple interest. Principal and accumulated interest is due and payable upon completion of the term of the loan. For any loan made pursuant to this subdivision, the performance requirements of the lien shall remain in effect for a period of no less than the original term of the loan.
(3) The program shall be administered by the Director of Housing and Community Development and officers and employees of the department as he or she may designate.
(b) (1) The Joe Serna, Jr. Farmworker Housing Grant Fund is hereby created in the State Treasury. Notwithstanding Section 13340 of the Government Code, all money in the fund is continuously appropriated to the department for making grants or loans, or both, pursuant to this section and Section 50517.10, for purposes of Chapter 8.5 (commencing with Section 50710), and for costs incurred by the department in administering these programs.
(2) There shall be paid into the fund the following:
(A) Any moneys appropriated and made available by the Legislature for purposes of the fund.
(B) Any moneys that the department receives in repayment or return of grants or loans from the fund, including any interest therefrom.
(C) Any other moneys that may be made available to the department for the purposes of this chapter from any other source or sources.
(D) All moneys appropriated to the department for the purposes of Chapter 8.5 (commencing with Section 50710) and any moneys received by the department from the occupants of housing or shelter provided pursuant to Chapter 8.5 (commencing with Section 50710). These moneys shall be separately accounted for from the other moneys deposited in the fund.
(c) (1) Grants and loans made pursuant to this section shall be matched by grantees with at least equal amounts of federal moneys, other cash investments, or in-kind contributions.
(2) For grant or loan requests of not more than five hundred thousand dollars ($500,000), the department may waive a part of the matching fund requirement in this subdivision if the grantee demonstrates an inability, as may be established by the department in "Notices of Funding Availability," to secure adequate financing from other sources. Not more than 5 percent of the total amount appropriated to the department for the purposes of this section may be used to meet grant or loan requests in which a part of the matching fund requirement has been waived pursuant to this paragraph.
(d) With respect to the supervision of grantees, the department shall do the following:
(1) Establish minimum capital reserves to be maintained by grantees.
(2) Fix and alter from time to time a schedule of rents that may be necessary to provide residents of housing assisted pursuant to this section with affordable rents to the extent consistent with the maintenance of the financial integrity of the housing project. No grantee shall increase the rent on any unit constructed or rehabilitated with the assistance of funds provided pursuant to this section without the prior permission of the department, which shall be given only if the grantee affirmatively demonstrates that the increase is required to defray necessary operating costs or avoid jeopardizing the fiscal integrity of the housing project.
(3) Determine standards for, and control selection by grantees of, tenants and subsequent purchasers of housing constructed or rehabilitated with the assistance of funds provided pursuant to this section.
(4) (A) Require as a condition precedent to a grant or loan, or both, of funds that the applicant have site control that is satisfactory to the department; that the grantee be record owner in fee of the assisted real property or provide other security including a lien on the manufactured home that is satisfactory to the department to ensure compliance with the construction, financial, and program obligations; and that the grantee shall have entered into a written agreement with the department binding upon the grantee and successors in interest to the grantee. The agreement shall include the conditions under which the funds advanced may be repaid. The agreement shall include provisions for a lien on the assisted real property or manufactured home in favor of the State of California for the purpose of securing performance of the agreement. The agreement shall also provide that the lien shall endure until released by the Director of Housing and Community Development.
(B) If funds granted or loaned pursuant to this section constitute less than 25 percent of the total development cost or value, whichever is applicable, of a project assisted under this section, the department may adopt, by regulation, criteria for determining the number of units in a project to which the restrictions on occupancy contained in the agreement apply. In no event may these regulations provide for the application of the agreement to a percentage of units in a project that is less than the percentage of total development costs that funds granted or loaned pursuant to this section represent.
(C) Contemporaneously with the disbursement of the initial funds to a grantee, the department shall cause to be recorded, in the office of the county recorder of the county in which the assisted real property is located, a notice of lien executed by the Director of Housing and Community Development. The notice of lien shall refer to the agreement required by this paragraph for which it secures and it shall include a legal description of the assisted real property that is subject to the lien. The notice of lien shall be indexed by the recorder in the Grantor Index to the name of the grantee and in the Grantee Index to the name of the State of California, Department of Housing and Community Development. For manufactured housing, the liens shall be recorded by the department in the same manner as other manufactured housing liens are recorded. The department shall adopt by regulation criteria for the determination of the lien period. This regulation shall take into account whether the property is held by multifamily rental, single-family ownership, or cooperative ownership and whether it is new construction or rehabilitative construction. The lien period for manufactured housing liens for manufactured homes shall not exceed 10 years.
(D) Pursuant to regulations adopted by the department, the department may execute and cause to be recorded in the office of the recorder of the county in which a notice of lien has been recorded, or the department, as appropriate, a subordination of the lien. The regulations adopted by the department shall provide that any subordination of the lien shall not jeopardize the security interest of the state and shall further the interest of farmworker housing. The recitals contained in the subordination shall be conclusive in favor of any bona fide purchaser or lender relying thereon.
(E) Prior to funds granted pursuant to this section being used to finance the acquisition of a manufactured home, the grantee shall ensure that the home either is already installed in a location where it will be occupied by the eligible household or that a location has been leased or otherwise made available for the manufactured home to be occupied by the eligible household.
(5) Regulate the terms of occupancy agreements or resale controls, to be used in housing assisted pursuant to this section.
(6) Provide linguistically appropriate services and publications, or require grantees to do so, as necessary to implement the purposes of this section.
(7) The agreement between the department and the grantee shall provide, among other things, that both of the following occur:
(A) Upon the sale or conveyance of the real property, or any part thereof, for use other than for agricultural employee occupancy, the grantee or its successors shall, as a condition for the release of the lien provided pursuant to paragraph (4), repay to the fund the department's grant and loan funds.
(B) Upon the sale or conveyance of the real property or any part thereof for continued agricultural employee occupancy, the transferee shall assume the obligation of the transferor and the real property shall be transferred to the new owner; provided that the transferee agrees to abide by the agreement entered into between the transferor and the department and that the new owner takes the property subject to the lien provided pursuant to paragraph (4), except that this lien shall, at the time of the transfer of the property to the new owner, be extended for an additional lien period determined by the department pursuant to paragraph (4), and the new owner shall not be credited with the lien period that had run from the time the transferor had acquired the property to the time of transfer to the new owner, unless the department determines that it is in the best interest of the state and consistent with the intent of this section to so credit the lien period to the new owner. However, the lien shall have priority as of the recording date of the lien for the original grantee, pursuant to paragraph (4).
(e) The department may do any of the following with respect to grantees:
(1) Through its agents or employees enter upon and inspect the lands, buildings, and equipment of a grantee, including books and records, at any time before, during, or after construction or rehabilitation of units assisted pursuant to this section. However, there shall be no entry or inspection of any unit that is occupied, whether or not any occupant is actually present, without the consent of the occupant.
(2) Supervise the operation and maintenance of any housing assisted pursuant to this section and order repairs as may be necessary to protect the public interest or the health, safety, or welfare of occupants of the housing.
(f) The department shall include in its annual report required by Section 50408, a current report of the Joe Serna, Jr. Farmworker Housing Grant Program. The report shall include, but need not be limited to, (1) the number of households assisted, (2) the average income of households assisted and the distribution of annual incomes among assisted households, (3) the rents paid by households assisted, (4) the number and amount of grants or loans, or both, made to each grantee in the preceding year, (5) the dollar value of funding derived from sources other than the state for each project receiving a grant or loan, or both, under this section, and an identification of each source, (6) recommendations, as needed, to improve operations of the program and respecting the desirability of extending its application to other groups in rural areas identified by the department as having special need for state housing assistance, and (7) the number of manufactured housing units assisted under this section.
(g) As used in this section:
(1) "Agricultural employee" has the same meaning as specified in subdivision (b) of Section 1140.4 of the Labor Code, but also includes any person who works on or off the farm in the processing of any agricultural commodity until it is shipped for distribution, whether or not this person is encompassed within the definition specified in subdivision (b) of Section 1140.4 of the Labor Code.
(2) "Grantee" means the local public entity, nonprofit corporation, limited liability company, or limited partnership that is awarded the grant or loan, or both, under this section, and, at the request thereof, may include an agricultural employee receiving direct payment of a grant for rehabilitation under this section who occupies the assisted housing both before and after the rehabilitation and may include an agricultural employee receiving direct payment of a grant for construction under this section who will occupy the assisted housing and who is a participant in a rehabilitation or construction program sponsored and supervised by a local public entity, nonprofit corporation, limited liability company, or limited partnership.
(3) "Housing" may include, but is not necessarily limited to, conventionally constructed units and manufactured housing installed pursuant to either Section 18551 or 18613.
(4) "Limited liability company" means a limited liability company where all the members are nonprofit public benefit corporations.
(5) "Limited partnership" means a limited partnership where all of the general partners are either nonprofit public benefit corporations, limited liability companies, or a combination of nonprofit public benefit corporations and limited liability companies.
(h) The department may provide the assistance offered pursuant to this chapter in any area where there is a substantial unmet need for farmworker housing.
(2) Notwithstanding any other provision of this chapter, upon the request of a grantee the program also may loan funds to a grantee at no more than 3 percent simple interest. Principal and accumulated interest is due and payable upon completion of the term of the loan. For any loan made pursuant to this subdivision, the performance requirements of the lien shall remain in effect for a period of no less than the original term of the loan.
(3) The program shall be administered by the Director of Housing and Community Development and officers and employees of the department as he or she may designate.
(b) (1) The Joe Serna, Jr. Farmworker Housing Grant Fund is hereby created in the State Treasury. Notwithstanding Section 13340 of the Government Code, all money in the fund is continuously appropriated to the department for making grants or loans, or both, pursuant to this section and Section 50517.10, for purposes of Chapter 8.5 (commencing with Section 50710), and for costs incurred by the department in administering these programs.
(2) There shall be paid into the fund the following:
(A) Any moneys appropriated and made available by the Legislature for purposes of the fund.
(B) Any moneys that the department receives in repayment or return of grants or loans from the fund, including any interest therefrom.
(C) Any other moneys that may be made available to the department for the purposes of this chapter from any other source or sources.
(D) All moneys appropriated to the department for the purposes of Chapter 8.5 (commencing with Section 50710) and any moneys received by the department from the occupants of housing or shelter provided pursuant to Chapter 8.5 (commencing with Section 50710). These moneys shall be separately accounted for from the other moneys deposited in the fund.
(c) (1) Grants and loans made pursuant to this section shall be matched by grantees with at least equal amounts of federal moneys, other cash investments, or in-kind contributions.
(2) For grant or loan requests of not more than five hundred thousand dollars ($500,000), the department may waive a part of the matching fund requirement in this subdivision if the grantee demonstrates an inability, as may be established by the department in "Notices of Funding Availability," to secure adequate financing from other sources. Not more than 5 percent of the total amount appropriated to the department for the purposes of this section may be used to meet grant or loan requests in which a part of the matching fund requirement has been waived pursuant to this paragraph.
(d) With respect to the supervision of grantees, the department shall do the following:
(1) Establish minimum capital reserves to be maintained by grantees.
(2) Fix and alter from time to time a schedule of rents that may be necessary to provide residents of housing assisted pursuant to this section with affordable rents to the extent consistent with the maintenance of the financial integrity of the housing project. No grantee shall increase the rent on any unit constructed or rehabilitated with the assistance of funds provided pursuant to this section without the prior permission of the department, which shall be given only if the grantee affirmatively demonstrates that the increase is required to defray necessary operating costs or avoid jeopardizing the fiscal integrity of the housing project.
(3) Determine standards for, and control selection by grantees of, tenants and subsequent purchasers of housing constructed or rehabilitated with the assistance of funds provided pursuant to this section.
(4) (A) Require as a condition precedent to a grant or loan, or both, of funds that the applicant have site control that is satisfactory to the department; that the grantee be record owner in fee of the assisted real property or provide other security including a lien on the manufactured home that is satisfactory to the department to ensure compliance with the construction, financial, and program obligations; and that the grantee shall have entered into a written agreement with the department binding upon the grantee and successors in interest to the grantee. The agreement shall include the conditions under which the funds advanced may be repaid. The agreement shall include provisions for a lien on the assisted real property or manufactured home in favor of the State of California for the purpose of securing performance of the agreement. The agreement shall also provide that the lien shall endure until released by the Director of Housing and Community Development.
(B) If funds granted or loaned pursuant to this section constitute less than 25 percent of the total development cost or value, whichever is applicable, of a project assisted under this section, the department may adopt, by regulation, criteria for determining the number of units in a project to which the restrictions on occupancy contained in the agreement apply. In no event may these regulations provide for the application of the agreement to a percentage of units in a project that is less than the percentage of total development costs that funds granted or loaned pursuant to this section represent.
(C) Contemporaneously with the disbursement of the initial funds to a grantee, the department shall cause to be recorded, in the office of the county recorder of the county in which the assisted real property is located, a notice of lien executed by the Director of Housing and Community Development. The notice of lien shall refer to the agreement required by this paragraph for which it secures and it shall include a legal description of the assisted real property that is subject to the lien. The notice of lien shall be indexed by the recorder in the Grantor Index to the name of the grantee and in the Grantee Index to the name of the State of California, Department of Housing and Community Development. For manufactured housing, the liens shall be recorded by the department in the same manner as other manufactured housing liens are recorded. The department shall adopt by regulation criteria for the determination of the lien period. This regulation shall take into account whether the property is held by multifamily rental, single-family ownership, or cooperative ownership and whether it is new construction or rehabilitative construction. The lien period for manufactured housing liens for manufactured homes shall not exceed 10 years.
(D) Pursuant to regulations adopted by the department, the department may execute and cause to be recorded in the office of the recorder of the county in which a notice of lien has been recorded, or the department, as appropriate, a subordination of the lien. The regulations adopted by the department shall provide that any subordination of the lien shall not jeopardize the security interest of the state and shall further the interest of farmworker housing. The recitals contained in the subordination shall be conclusive in favor of any bona fide purchaser or lender relying thereon.
(E) Prior to funds granted pursuant to this section being used to finance the acquisition of a manufactured home, the grantee shall ensure that the home either is already installed in a location where it will be occupied by the eligible household or that a location has been leased or otherwise made available for the manufactured home to be occupied by the eligible household.
(5) Regulate the terms of occupancy agreements or resale controls, to be used in housing assisted pursuant to this section.
(6) Provide linguistically appropriate services and publications, or require grantees to do so, as necessary to implement the purposes of this section.
(7) The agreement between the department and the grantee shall provide, among other things, that both of the following occur:
(A) Upon the sale or conveyance of the real property, or any part thereof, for use other than for agricultural employee occupancy, the grantee or its successors shall, as a condition for the release of the lien provided pursuant to paragraph (4), repay to the fund the department's grant and loan funds.
(B) Upon the sale or conveyance of the real property or any part thereof for continued agricultural employee occupancy, the transferee shall assume the obligation of the transferor and the real property shall be transferred to the new owner; provided that the transferee agrees to abide by the agreement entered into between the transferor and the department and that the new owner takes the property subject to the lien provided pursuant to paragraph (4), except that this lien shall, at the time of the transfer of the property to the new owner, be extended for an additional lien period determined by the department pursuant to paragraph (4), and the new owner shall not be credited with the lien period that had run from the time the transferor had acquired the property to the time of transfer to the new owner, unless the department determines that it is in the best interest of the state and consistent with the intent of this section to so credit the lien period to the new owner. However, the lien shall have priority as of the recording date of the lien for the original grantee, pursuant to paragraph (4).
(e) The department may do any of the following with respect to grantees:
(1) Through its agents or employees enter upon and inspect the lands, buildings, and equipment of a grantee, including books and records, at any time before, during, or after construction or rehabilitation of units assisted pursuant to this section. However, there shall be no entry or inspection of any unit that is occupied, whether or not any occupant is actually present, without the consent of the occupant.
(2) Supervise the operation and maintenance of any housing assisted pursuant to this section and order repairs as may be necessary to protect the public interest or the health, safety, or welfare of occupants of the housing.
(f) The department shall include in its annual report required by Section 50408, a current report of the Joe Serna, Jr. Farmworker Housing Grant Program. The report shall include, but need not be limited to, (1) the number of households assisted, (2) the average income of households assisted and the distribution of annual incomes among assisted households, (3) the rents paid by households assisted, (4) the number and amount of grants or loans, or both, made to each grantee in the preceding year, (5) the dollar value of funding derived from sources other than the state for each project receiving a grant or loan, or both, under this section, and an identification of each source, (6) recommendations, as needed, to improve operations of the program and respecting the desirability of extending its application to other groups in rural areas identified by the department as having special need for state housing assistance, and (7) the number of manufactured housing units assisted under this section.
(g) As used in this section:
(1) "Agricultural employee" has the same meaning as specified in subdivision (b) of Section 1140.4 of the Labor Code, but also includes any person who works on or off the farm in the processing of any agricultural commodity until it is shipped for distribution, whether or not this person is encompassed within the definition specified in subdivision (b) of Section 1140.4 of the Labor Code.
(2) "Grantee" means the local public entity, nonprofit corporation, limited liability company, or limited partnership that is awarded the grant or loan, or both, under this section, and, at the request thereof, may include an agricultural employee receiving direct payment of a grant for rehabilitation under this section who occupies the assisted housing both before and after the rehabilitation and may include an agricultural employee receiving direct payment of a grant for construction under this section who will occupy the assisted housing and who is a participant in a rehabilitation or construction program sponsored and supervised by a local public entity, nonprofit corporation, limited liability company, or limited partnership.
(3) "Housing" may include, but is not necessarily limited to, conventionally constructed units and manufactured housing installed pursuant to either Section 18551 or 18613.
(4) "Limited liability company" means a limited liability company where all the members are nonprofit public benefit corporations.
(5) "Limited partnership" means a limited partnership where all of the general partners are either nonprofit public benefit corporations, limited liability companies, or a combination of nonprofit public benefit corporations and limited liability companies.
(h) The department may provide the assistance offered pursuant to this chapter in any area where there is a substantial unmet need for farmworker housing.
(a) The department may set aside the amount of funds
authorized by subdivision (d) for the purposes of curing or averting
a default on the terms of any loan or other obligation by the
recipient of financial assistance, or bidding at any foreclosure sale
where the default or foreclosure sale would jeopardize the
department's security in the dwelling unit assisted pursuant to this
chapter.
(b) The department may use the set-aside funds made available pursuant to this chapter to repair or maintain any dwelling unit assisted pursuant to this chapter that was acquired to protect the department's security interest in the dwelling unit.
(c) The payment or advance of funds by the department pursuant to this section shall be exclusively within the department's discretion, and no person shall be deemed to have any entitlement to the payment or advance of those funds. The amount of any funds expended by the department for the purposes of curing or averting a default shall be added to any grant amount secured by the lien and shall be payable to the department upon demand.
(d) On the effective date of the act that adds this section, the department may set aside up to two hundred thousand dollars ($200,000) from the Joe Serna, Jr. Farmworker Housing Grant Fund for the purposes authorized by this section. On July 1 of each subsequent fiscal year, the department may set aside, for the purposes of this section, up to 4 percent of the funds available in the Joe Serna, Jr. Farmworker Housing Grant Fund on that date.
(b) The department may use the set-aside funds made available pursuant to this chapter to repair or maintain any dwelling unit assisted pursuant to this chapter that was acquired to protect the department's security interest in the dwelling unit.
(c) The payment or advance of funds by the department pursuant to this section shall be exclusively within the department's discretion, and no person shall be deemed to have any entitlement to the payment or advance of those funds. The amount of any funds expended by the department for the purposes of curing or averting a default shall be added to any grant amount secured by the lien and shall be payable to the department upon demand.
(d) On the effective date of the act that adds this section, the department may set aside up to two hundred thousand dollars ($200,000) from the Joe Serna, Jr. Farmworker Housing Grant Fund for the purposes authorized by this section. On July 1 of each subsequent fiscal year, the department may set aside, for the purposes of this section, up to 4 percent of the funds available in the Joe Serna, Jr. Farmworker Housing Grant Fund on that date.
In counties in which a disaster has been declared by the
Governor pursuant to Chapter 7 (commencing with Section 8550) of
Division 1 of Title 2 of the Government Code and for a period of 12
months after the declaration, the department may provide grants from
the fund established by subdivision (b) of Section 50517.5, subject
to the following terms and conditions, which are applicable only to
this section:
(a) Grants may be made to local public entities, nonprofit corporations, and housing owners comprised of either homeowners who are agricultural employees or owners of rental property used primarily by agricultural households.
(b) The department may enter into master agreements with nonprofit corporations or local public entities or it may enter into contracts directly with housing owners to carry out the activities authorized by this section.
(c) The department may make grants directly to housing owners or through master agreements for the cost of preparation of applications for funds, and supervision of expenditures from the fund, including, but not limited to estimates, work writeups, bidding supervision, and inspections. Funds granted pursuant to this subdivision shall not be secured by, and subject to, the liens required by Section 50517.5.
(d) The department, either directly or through master agreements, may provide grants to housing owners which shall be used for housing rehabilitation or acquisition and rehabilitation, and related costs, other than those costs accruing pursuant to subdivision (c). Only those funds from the fund which are actually utilized pursuant to this subdivision shall be secured by, and subject to, the liens required by Section 50517.5.
(e) The department may waive the matching requirements of subdivision (c) of Section 50517.5.
(a) Grants may be made to local public entities, nonprofit corporations, and housing owners comprised of either homeowners who are agricultural employees or owners of rental property used primarily by agricultural households.
(b) The department may enter into master agreements with nonprofit corporations or local public entities or it may enter into contracts directly with housing owners to carry out the activities authorized by this section.
(c) The department may make grants directly to housing owners or through master agreements for the cost of preparation of applications for funds, and supervision of expenditures from the fund, including, but not limited to estimates, work writeups, bidding supervision, and inspections. Funds granted pursuant to this subdivision shall not be secured by, and subject to, the liens required by Section 50517.5.
(d) The department, either directly or through master agreements, may provide grants to housing owners which shall be used for housing rehabilitation or acquisition and rehabilitation, and related costs, other than those costs accruing pursuant to subdivision (c). Only those funds from the fund which are actually utilized pursuant to this subdivision shall be secured by, and subject to, the liens required by Section 50517.5.
(e) The department may waive the matching requirements of subdivision (c) of Section 50517.5.
A household deemed eligible by the United States
Department of Agriculture, under the Rural Housing Loan Program of
Section 502 of Title V of the Housing Act of 1949 (42 U.S.C. Sec.
1472 et seq.), on the basis of the household's ratio of housing costs
to household income shall be deemed eligible for a grant pursuant to
this chapter notwithstanding the department's calculation of the
ratio of housing costs to income utilizing different and additional
housing cost factors.
(a) In enacting this section, it is the intent of the
Legislature to provide disaster assistance for farmworkers displaced
by the 1997 floods in the most expeditious and fiscally sound manner
possible. It is the intent of the Legislature that the Department of
Housing and Community Development administer this section in
accordance with those goals.
(b) In counties in which a disaster has been declared by the Governor pursuant to Section 8625 of the Government Code, and for a period of 12 months after the declaration, the department may award funds for the purposes of this section, subject to the following terms and conditions:
(1) Loans may be made to local public entities, nonprofit corporations, and private property owners to repair, rehabilitate, or replace housing previously used exclusively by migrant farmworker households or unaccompanied migrant farmworker adults, which will be used in the future for those purposes. Loan funds may be used to acquire or lease "manufactured structures," which, for the purposes of this section, means structures subject to Part 2 (commencing with Section 18000) of Division 13. Private property owners shall be eligible for loans only to the extent that other federal and state resources, private insurance proceeds, or private institutional lending sources are not available in a timely manner or do not provide the coverage needed to rehabilitate or reconstruct the housing without increasing the rent above that charged for the units prior to the disaster.
(2) The department may enter into contracts directly with nonprofit corporations, local public entities, or private property owners to carry out the activities authorized by this section.
(3) Loans made under this section shall be secured by, and subject to, security instruments approved by the department, including, but not limited to, real property leases or liens, regulatory agreements, and liens on manufactured structures. The department shall establish loan terms and conditions with consideration to the financial feasibility and prudent operation of the housing units financed. In no event shall the loans require interest at a rate higher than 3-percent simple interest or have a term longer than the useful life of the housing units. Repayments may be deferred for the first five years of the loan term, if the department determines that it is necessary for fiscal integrity or to prevent foreclosure.
(4) In making any loan, the department shall require that the borrower meet all of the following conditions:
(A) The borrower shall be capable of providing occupancy in decent, safe, and sanitary housing that meets all of the requirements of law within six months after the award of funds.
(B) The borrower shall demonstrate the financial feasibility of the project.
(C) Prior to disbursement of funds, the borrower shall identify the property on which the housing will be repaired, rehabilitated, or replaced, and provide information satisfactory to the department related to the costs and sources of funding necessary to complete the repairs, rehabilitation, or replacement. All costs shall be reasonable, considering the necessity of expeditious rehabilitation or replacement.
(5) Priority for use of the funds shall be given to borrowers who will provide housing at the earliest date.
(6) All units assisted under this section shall remain affordable to low- and very low income households for the life of the project. For the 1997-98 growing season, farmworkers who previously occupied the damaged or destroyed housing shall have first priority to occupy any unit assisted under this section.
(7) If units assisted under this section are built or rehabilitated in the same natural disaster zone as the units damaged or destroyed by the disaster, the borrower shall maintain disaster insurance on the units for the useful life of the units. For purposes of this section, "disaster insurance" means fire, earthquake, flood, or other insurance against the natural disaster that damaged or destroyed the housing units.
(8) To the extent that any housing unit that was damaged or destroyed is reconstructed under this section with substantially the same number of units, it shall be deemed to be "existing housing" for the purposes of subdivision (d) of Section 37001.5.
(9) The department may waive any requirements of Section 50517.5 and any regulations promulgated thereunder that are inconsistent with prompt and effective implementation of the program described in this section. In addition, any rule, policy, or standard of general application employed by the department in implementing the provision of this section shall not be subject to the requirements of Chapter 3.5 (commencing with Section 11340) of Part 12 of Division 3 of Title 2 of the Government Code. Awards of funds made pursuant to this section shall not be subjected to review or approval by the Local Assistance Loan and Grant Committee of the department operating pursuant to Subchapter 1 (commencing with Section 6900) of Chapter 6.5 of Title 25 of the California Code of Regulations.
(b) In counties in which a disaster has been declared by the Governor pursuant to Section 8625 of the Government Code, and for a period of 12 months after the declaration, the department may award funds for the purposes of this section, subject to the following terms and conditions:
(1) Loans may be made to local public entities, nonprofit corporations, and private property owners to repair, rehabilitate, or replace housing previously used exclusively by migrant farmworker households or unaccompanied migrant farmworker adults, which will be used in the future for those purposes. Loan funds may be used to acquire or lease "manufactured structures," which, for the purposes of this section, means structures subject to Part 2 (commencing with Section 18000) of Division 13. Private property owners shall be eligible for loans only to the extent that other federal and state resources, private insurance proceeds, or private institutional lending sources are not available in a timely manner or do not provide the coverage needed to rehabilitate or reconstruct the housing without increasing the rent above that charged for the units prior to the disaster.
(2) The department may enter into contracts directly with nonprofit corporations, local public entities, or private property owners to carry out the activities authorized by this section.
(3) Loans made under this section shall be secured by, and subject to, security instruments approved by the department, including, but not limited to, real property leases or liens, regulatory agreements, and liens on manufactured structures. The department shall establish loan terms and conditions with consideration to the financial feasibility and prudent operation of the housing units financed. In no event shall the loans require interest at a rate higher than 3-percent simple interest or have a term longer than the useful life of the housing units. Repayments may be deferred for the first five years of the loan term, if the department determines that it is necessary for fiscal integrity or to prevent foreclosure.
(4) In making any loan, the department shall require that the borrower meet all of the following conditions:
(A) The borrower shall be capable of providing occupancy in decent, safe, and sanitary housing that meets all of the requirements of law within six months after the award of funds.
(B) The borrower shall demonstrate the financial feasibility of the project.
(C) Prior to disbursement of funds, the borrower shall identify the property on which the housing will be repaired, rehabilitated, or replaced, and provide information satisfactory to the department related to the costs and sources of funding necessary to complete the repairs, rehabilitation, or replacement. All costs shall be reasonable, considering the necessity of expeditious rehabilitation or replacement.
(5) Priority for use of the funds shall be given to borrowers who will provide housing at the earliest date.
(6) All units assisted under this section shall remain affordable to low- and very low income households for the life of the project. For the 1997-98 growing season, farmworkers who previously occupied the damaged or destroyed housing shall have first priority to occupy any unit assisted under this section.
(7) If units assisted under this section are built or rehabilitated in the same natural disaster zone as the units damaged or destroyed by the disaster, the borrower shall maintain disaster insurance on the units for the useful life of the units. For purposes of this section, "disaster insurance" means fire, earthquake, flood, or other insurance against the natural disaster that damaged or destroyed the housing units.
(8) To the extent that any housing unit that was damaged or destroyed is reconstructed under this section with substantially the same number of units, it shall be deemed to be "existing housing" for the purposes of subdivision (d) of Section 37001.5.
(9) The department may waive any requirements of Section 50517.5 and any regulations promulgated thereunder that are inconsistent with prompt and effective implementation of the program described in this section. In addition, any rule, policy, or standard of general application employed by the department in implementing the provision of this section shall not be subject to the requirements of Chapter 3.5 (commencing with Section 11340) of Part 12 of Division 3 of Title 2 of the Government Code. Awards of funds made pursuant to this section shall not be subjected to review or approval by the Local Assistance Loan and Grant Committee of the department operating pursuant to Subchapter 1 (commencing with Section 6900) of Chapter 6.5 of Title 25 of the California Code of Regulations.
In addition to the purposes specified in subdivision (a)
of Section 50517.5, the department may make grants and loans under
the Joe Serna, Jr. Farmworker Housing Grant Program to local public
entities and nonprofit corporations in order to establish capitalized
operating reserves for short-term occupancy housing for migrant
farmworker households, purchase land for, and construct, housing
structures for short-term occupancy by migrant farmworker households,
lease or purchase existing structures for short-term occupancy by
migrant farmworker households, and, where the department determines
that extraordinary or emergency circumstances exist, directly rent or
lease housing for short-term occupancy by migrant farmworker
households.
