Article 4. Contracts For Development And Construction By Local Housing Authorities of California Health And Safety Code >> Division 31. >> Part 2. >> Chapter 9. >> Article 4.

The department may contract with local housing authorities and provide funds which shall be used by such authorities to develop and construct rental housing developments to be operated by such housing authorities and to be rented to eligible households.

Each contract pursuant to Section 50765 shall contain at least the following provisions:
  (a) The timing, amount, and terms of payments to be provided under this article, including specific items to be covered by such payments.
  (b) A description of the way in which the payments will be used to provide affordable rents to eligible households occupying dwelling units within the rental housing development.
  (c) A description of the rental housing development, projected rent levels for all units and the number of units to be occupied by eligible households.
  (d) Restrictions on occupancy of dwelling units within the rental housing development, as necessary to meet the requirements of Sections 50736 and 50739.
  (e) A requirement that prevailing wage rates be paid with respect to construction of the rental housing development, and that all contractors and subcontractors use affirmative action in hiring.
  (f) A requirement for periodic reports by the housing authority, which shall at a minimum include information on the fiscal condition of the rental housing development, the maintenance of such development, and the number of units occupied by eligible households.
  (g) Provisions sufficient to ensure that assisted units shall be available to or occupied by eligible households for a period of not less than 30 years.
  (h) A provision which specifies the conditions under which the department and any intended beneficiary may enforce the contract.
  (i) A provision that failure to operate the assisted units in accordance with the regulatory agreement shall be deemed a violation of the regulatory agreement or deed of trust, as the case may be. In the alternative, or in addition, the contract may contain a lien on the rental housing development for the purpose of securing performance of the contract. Such lien shall include a legal description of the assisted real property which is subject to the lien and shall specify the duration of the lien on the assisted property.
  (j) Provisions necessary for the administration, disbursement, and protection of annuity fund payments including provisions specifying the conditions under which the department may recover or reallocate all or any part of such payments for the benefit of eligible households in additional or existing assisted units.
  (k) Provisions governing the recovery and reallocation by the department of rent revenues derived by the sponsor from the assisted units, which are not necessary to defray the costs of operation attributable to such units. Such revenues shall be handled by the department in the same manner as annuity payments recovered pursuant to subdivision (j).
  ( l) Authorization for the local housing authority to fix and alter rents pursuant to the provisions of subdivision (a) of Section 50767.
  (m) Any other provisions necessary to carry out the purposes and exercise the powers granted by this chapter. Any contract pursuant to Section 50765 containing a lien shall be recorded or referenced in a document recorded in the county in which the real property subject to the lien is located and shall be indexed by the recorder in the grantor index to the name of the local housing authority and in the grantee index to the name of the State of California.

With respect to assisted units developed and constructed pursuant to this article, the local housing authority shall, with the approval of the department:
  (a) Ensure the provision of affordable rents.
  (b) Ensure that the incomes of tenants are recertified annually.
  (c) Ensure that upon income recertification rents are adjusted and take effect within 30 days of adjustment.
  (d) Determine standards for and ensure fair procedures for, the selection of tenants by housing sponsors or other management designated pursuant to Section 50758 to ensure occupancy by eligible households consistent with the requirements of Sections 50736 and 50739.
  (e) Regulate the terms of tenant occupancy agreements.

The department shall monitor the operation at the rental housing development constructed pursuant to this article, to ensure compliance with grant conditions, contract obligations, and the provisions of this chapter and regulations adopted pursuant to this chapter.