74th OREGON LEGISLATIVE ASSEMBLY--2007 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 340
House Bill 2096
Ordered printed by the Speaker pursuant to House Rule 12.00A (5).
Presession filed (at the request of Governor Theodore R.
Kulongoski for Housing and Community Services Department)
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Authorizes formation of manufactured dwelling park nonprofit
cooperatives. Allows manufactured dwelling park nonprofit
cooperatives to qualify for housing loans and technical
assistance programs.
Modifies definitions pertaining to persons qualifying for
housing programs. Changes requirement for Housing and Community
Services Department adoption of criteria for approving financing
applications.
Allows department to insure loans to manufactured dwellings,
manufactured dwelling parks and manufactured dwelling park
nonprofit cooperatives if loans provide significant benefit to
persons and families of lower income. Increases percentage of
loan for which department may use Guarantee Fund to issue loan
guarantee.
Regulates use of department-provided financing for nonhousing
purposes. Regulates limited dividend housing sponsor
distributions and operations.
A BILL FOR AN ACT
Relating to housing; creating new provisions; and amending ORS
456.515, 456.539, 456.555, 456.571, 456.581, 456.593, 456.612,
456.615, 456.625, 456.630, 456.690, 456.705, 456.710, 456.715,
458.215 and 458.630.
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + Sections 2 to 7 of this 2007 Act are added to
and made a part of ORS chapter 62. + }
SECTION 2. { + (1) Sections 2 to 7 of this 2007 Act may be
cited as the Manufactured Dwelling Park Nonprofit Cooperative
Corporation Act.
(2) The purpose of sections 2 to 7 of this 2007 Act is to
recognize the cooperative form of ownership by a nonprofit entity
of an interest in real property consisting of a manufactured
dwelling park.
(3) In the event of any conflict between sections 2 to 7 of
this 2007 Act and other provisions of this chapter, sections 2 to
7 of this 2007 Act control. + }
SECTION 3. { + As used in sections 2 to 7 of this 2007 Act,
unless the context requires otherwise:
(1) 'Manufactured dwelling' has the meaning given that term in
ORS 446.003.
(2) 'Manufactured dwelling park' has the meaning given that
term in ORS 446.003.
(3) 'Manufactured dwelling park nonprofit cooperative ' means a
cooperative corporation that:
(a) Is organized to acquire or develop, and to own, an interest
in one or more manufactured dwelling parks that are primarily
used for the siting of manufactured dwellings owned and occupied
by members of the cooperative;
(b) Limits the use of all income and earnings to use by the
cooperative and not for the benefit or profit of any individual;
and
(c) Elects to be governed by sections 2 to 7 of this 2007
Act. + }
SECTION 4. { + (1) A cooperative organized under this chapter
may elect to become a manufactured dwelling park nonprofit
cooperative by stating that election in the articles of
incorporation.
(2) A cooperative may not revoke an election made under
subsection (1) of this section. A manufactured dwelling park
nonprofit cooperative may dissolve as provided in this
chapter. + }
SECTION 5. { + (1) A person may become a member of a
manufactured dwelling park nonprofit cooperative if the person:
(a) Is a natural person;
(b) Owns a manufactured dwelling that is, or is to be, located
in a manufactured dwelling park of the cooperative and occupied
by the person;
(c)(A) Pays the membership fee required by the cooperative; or
(B) Purchases a share of membership stock issued by the
cooperative; and
(d) Meets any additional membership qualifications established
in the articles of incorporation or bylaws of the cooperative.
(2) A manufactured dwelling park nonprofit cooperative shall
accept as a member any person who meets the qualifications
described in subsection (1) of this section.
(3) Membership in a manufactured dwelling park nonprofit
cooperative entitles the member to rent space for a manufactured
dwelling in a manufactured dwelling park of the cooperative and
to occupy the manufactured dwelling.
(4) A cooperative shall create or issue one membership or share
of membership stock for each manufactured dwelling that is, or is
to be, located in a manufactured dwelling park of the cooperative
and occupied by the dwelling owner. A person may not own more
than one membership or share of membership stock in the same
cooperative. A membership or membership stock may not be issued
or transferred to a person unless the person meets the
qualifications for membership described in subsection (1) of this
section.
(5) A cooperative shall issue memberships or shares of
membership stock for a fee determined by the directors of the
cooperative. The directors may periodically adjust the fee amount
as provided in the articles of incorporation or bylaws of the
cooperative. Except for periodic adjustments, the membership fee
or membership stock price charged by the cooperative shall be the
same for all members. A member may not sell, transfer or redeem a
membership for more than the amount the member paid for the
membership plus any adjustments approved by the directors to
reflect cost-of-living increases.
(6) The articles of incorporation or bylaws of the cooperative
shall establish the methods for accepting and terminating
membership and for the sale, transfer or redemption of a
membership or share of membership stock. + }
SECTION 6. { + (1) As used in this section, 'debts,
liabilities and obligations' includes, but is not limited to, the
repurchase of each membership in the cooperative for the amount
last charged by the cooperative as a membership fee or as the
purchase price of membership stock.
(2) If a manufactured dwelling park nonprofit cooperative
dissolves, after payment or provision for all debts, liabilities
and obligations of the cooperative, the cooperative shall
distribute the assets of the cooperative to:
(a) Another manufactured dwelling park nonprofit cooperative;
(b) An organization organized for a public or charitable
purpose;
(c) A religious corporation;
(d) The United States;
(e) This state;
(f) A local government in this state;
(g) A housing authority created under ORS 456.055 to 456.235;
or
(h) A person that is recognized as tax exempt under section
501(c)(3) of the Internal Revenue Code. + }
SECTION 7. { + (1) As used in this section, 'business entity '
has the meaning given that term in ORS 62.605.
(2) A manufactured dwelling park nonprofit cooperative may not:
(a) Notwithstanding ORS 62.225, pay a dividend on stock to
members.
(b) Apportion, distribute or pay net proceeds or savings to
members.
(c) Make payments in redemption or refund of capital credits or
retains to an heir of a member.
(d) Merge with a business entity other than another
manufactured dwelling park nonprofit cooperative.
(e) Convert to another type of business entity. + }
SECTION 8. { + Section 9 of this 2007 Act is added to and made
a part of ORS 456.550 to 456.725. + }
SECTION 9. { + (1) Not more than 50 percent of the total
amount of any financing provided by the Housing and Community
Services Department for a particular housing development may be
used to finance commercial, recreational, industrial, communal or
educational facilities. Profits from incidental elements shall be
applied to loans due under ORS 456.550 to 456.725.
(2) A limited dividend housing sponsor shall be restricted as
to distribution of income and shall be regulated as to rents,
charges, rate of return and methods of operation as the
department determines necessary to carry out the purposes of ORS
456.550 to 456.725.
(3) Not more than 50 percent of the total amount of any
financing provided by the department for a particular residential
housing development may be used to finance nonhousing facilities.
(4) An insured or guaranteed residential loan need not be
secured by a first mortgage on real property but, unless the loan
is to a manufactured dwelling park nonprofit cooperative, shall
be secured by a security interest of first priority. If the
insured or guaranteed loan is to a manufactured dwelling park
nonprofit cooperative, the loan shall be secured by a security
interest of first or second priority. + }
SECTION 10. ORS 456.515 is amended to read:
456.515. As used in ORS 456.515 to 456.725 and ORS chapter 458
unless the context requires otherwise:
(1) 'Community Action Directors of Oregon' means an
organization described in ORS 458.505.
(2) 'Construction' includes, but is not limited to, new
construction or moderate or substantial rehabilitation of
existing structures or facilities.
(3) 'Council' means the State Housing Council established under
ORS 456.567.
(4) 'Department' means the Housing and Community Services
Department established under ORS 456.555.
(5) 'Director' means the Director of the Housing and Community
Services Department.
(6) 'Disabled person' means a person who has a physical or
mental impairment that substantially limits one or more major
life activities.
(7) 'Elderly household' means a household whose head is over
the age of { - 58 - } { + 55 + }, residing in this state
{ - , who cannot obtain in the open market decent, safe and
sanitary housing, including the costs of utilities and taxes, for
25 percent of the gross income of the household - } .
(8) 'Major life activity' includes but is not limited to
self-care, ambulation, communication, transportation, education,
socialization, employment and ability to acquire, rent or
maintain property.
(9)(a) 'Multifamily housing' means a structure or facility
established primarily to provide housing that provides more than
one living unit, and may also provide facilities that are
functionally related and subordinate to the living units for use
by the occupants in social, health, educational or recreational
activities:
(A) For the elderly, including but not limited to individual
living units within such structures, mobile home and manufactured
dwelling parks and residential facilities licensed under ORS
443.400 to 443.455 and other congregate care facilities with or
without domiciliary care.
(B) For disabled persons, including, but not limited to,
individual living units within such structures, mobile home and
manufactured dwelling parks and residential facilities licensed
under ORS 443.400 to 443.455 and other congregate care facilities
with or without domiciliary care.
(b) 'Multifamily housing' does not include nursing homes,
hospitals, places primarily engaged in recreational activities
and single-family, detached dwellings, except manufactured
dwellings situated in a mobile home and manufactured dwelling
park.
(10) 'Target population' means:
(a) Elderly households; or
(b) Disabled persons.
SECTION 11. ORS 456.539 is amended to read:
456.539. (1) The Housing and Community Services Department
shall be the agency for the State of Oregon for the
administration of the Elderly and Disabled Housing Fund. Except
as otherwise provided in ORS 456.515 to 456.725 the provisions of
ORS 456.515 to 456.725 are applicable to the administration of
the Elderly and Disabled Housing Fund.
(2) The department is authorized to use the Elderly and
Disabled Housing Fund to advance funds, by contract, grant, loan
or otherwise, as provided by Article XI-I(2) of the Oregon
Constitution to finance multifamily housing for elderly
households, disabled persons and their family members and such
other persons who reside therein as are necessary to maintain the
housing or provide services or companionship for elderly
households and disabled persons.
(3) In carrying out the provisions specified in Article XI-I(2)
of the Oregon Constitution, the department shall, with the
concurrence of the State Housing Council, adopt criteria for
approval of projects proposed by qualified housing sponsors to
finance multifamily housing for the target population and their
family members and such other persons who reside therein as are
necessary to maintain the housing or provide services or
companionship for elderly households and disabled persons. The
criteria shall:
(a) Assure that health, mental health and other supportive
services as may be necessary to maintain elderly and disabled
households living in the housing are available to the occupants
onsite or in the community;
(b) Give priority to members of the target populations; and
(c) Allow occupancy by such family members or other persons as
the department determines necessary to maintain the housing and
provide services or companionship for elderly households and
disabled persons.
(4) The department shall:
(a) Adopt criteria { - , including maximum income limitations
not to exceed median family income, - } { + consistent with the
maximum household income restrictions in ORS 456.620 (4) + }for
approval of applications for financing the purchase by elderly
households of ownership interests within a multifamily structure
or facility.
{ - The criteria must include a requirement that the applicants
obtain loan cancellation life insurance. - }
(b) Provide means for allocating funds to finance multifamily
housing units for the target population and to establish
limitations on the interest and fees to be charged on loans made
by the department.
(c) Adopt rules necessary for efficient administration of the
Elderly and Disabled Housing Fund.
(d) Adopt rules to assure that each of the target populations
has access to a reasonable portion of the bond authority under
ORS 456.515 to 456.725, and that a reasonable portion of the
funds for elderly households is made available to finance the
purchase by elderly households of ownership interests within
multifamily housing structures or facilities.
(5) Loans made by the department under this section for the
interim construction financing of multifamily housing shall be
subject to the provisions of ORS 456.717.
SECTION 12. ORS 456.555 is amended to read:
456.555. (1) The Housing and Community Services Department is
established.
(2) The department shall be under the supervision and control
of a director who is responsible for the performance of the
duties imposed upon the department. The Governor shall appoint
the Director of the Housing and Community Services Department.
The director shall hold office at the pleasure of the Governor.
The person appointed as director shall be a person who, by
training and experience, is well qualified to perform the duties
of the office.
(3) The director shall receive such salary as may be provided
by law, or, if not so provided, as may be fixed by the Governor.
In addition to the salary of the director, the director shall,
subject to the limitations otherwise provided by law, be
reimbursed for all expenses actually and necessarily incurred by
the director in the performance of official duties.
(4) The director may establish department divisions including
but not limited to divisions for administration, housing programs
and community services programs.
(5) The State Housing Council shall:
(a) With the advice of the director, set policy and approve or
disapprove rules and standards for housing programs;
(b) Approve or disapprove loans, grants and other funding award
proposals under ORS 456.561; and
(c) Carry out the provisions of ORS 456.571.
(6) The Community Action Directors of Oregon shall advise the
department and the council on community services programs as
determined by the director and as set forth in ORS 458.505.
(7) The director shall report regularly to the council to keep
the council informed on progress made by the department in
carrying out the department's responsibilities for housing
programs.
(8) The department may adopt rules to carry out the programs
that the department is charged with administering, including, but
not limited to, rules regarding:
(a) Administration and enforcement.
(b) Criteria for the granting of benefits.
(c) The establishment of fees { + and charges + }.
(d) The identification of housing programs and community
services programs.
(e) The distinguishing of housing programs from community
services programs.
(9) Subject to the approval of the council, the department
shall establish by rule a threshold property purchase price above
which a single-family home ownership loan proposed by the
department requires council review and approval under ORS
456.561. In establishing or modifying a threshold property
purchase price under this subsection, the department shall
consider any maximum acquisition cost set forth in the Internal
Revenue Code or federal rules and regulations implementing the
code.
SECTION 13. ORS 456.571 is amended to read:
456.571. (1) The State Housing Council shall, with the advice
of the Director of the Housing and Community Services Department,
develop policies to aid in stimulating and increasing the supply
of housing for persons and families of lower income.
(2) The council shall make special effort to respond to both
private and public actions that may raise the cost of the housing
supply in the open market, as the open market is the source of
housing for the preponderance of lower income households.
(3) The council is responsible for studying and commenting
upon, and advising, the department, Governor, Legislative
Assembly, other state agencies and local governments concerning
local, state and federal legislation or rules that affect the
cost and supply of housing, both before and after the legislation
and rules are enacted. For purposes of this subsection,
'legislation or rules that affect the cost and supply of housing'
includes but is not limited to legislation or rules that would:
(a) Provide financing for the construction or rehabilitation of
housing;
(b) Subsidize new or existing housing costs for lower income
households by income support, tax credit, or support service
methods;
(c) Regulate the division of land;
(d) Regulate the use of land;
(e) Regulate building construction standards;
(f) Regulate fees { + and charges + } for inspection services,
permits, or professional services related to housing;
(g) Encourage alternatives that increase housing choices;
(h) Create or avert overlapping jurisdictional functions and
the concomitant increased costs that are reflected in housing
prices;
(i) Create or avoid conflicting state and federal regulations
that deprive lower income households of assistance; and
(j) Help or hinder compliance with the housing goals
established by the Land Conservation and Development Commission
under ORS 197.240.
(4) The council, with the approval of the Governor, may
initiate legal proceedings in the name of the council to further
the council's purposes under this section.
(5) The council shall exercise the responsibilities and powers
of the council in a manner that expedites the acquisition,
construction, improvement or rehabilitation of housing.
SECTION 14. ORS 456.581 is amended to read:
456.581. The Mobile Home Parks Purchase Account established in
ORS 456.579 shall be used by the Housing and Community Services
Department to provide:
(1) Technical assistance to tenants' associations, { +
manufactured dwelling park nonprofit cooperatives and + }
tenants' association supported nonprofit organizations and
{ + to + } facility purchase associations, as defined in ORS
90.100, { - to assist - } { + and to help + }tenants in
activities related to the purchase { + or preservation + } of a
mobile home { - and - } { + park or + } manufactured dwelling
park by a tenants' association, { + manufactured dwelling park
nonprofit cooperative, + } tenants' association supported
nonprofit organization or facility purchase association.
(2) By rule, loans for initial costs for purchasing a mobile
home { - and - } { + park or + } manufactured dwelling park
{ - predominantly occupied by - } { + that the department
determines has a significant percentage of residents who are
persons of + }lower income { - persons - } . Loans provided
under this section may be made only if the department is of the
opinion that the purchase is economically feasible and only to:
(a) A tenants' association { + , manufactured dwelling park
nonprofit cooperative + } or a tenants' association supported
nonprofit organization; or
(b) A facility purchase association established pursuant to ORS
90.815 that includes more than 50 percent of the tenants residing
in the park.
SECTION 15. ORS 456.593 is amended to read:
456.593. (1) As used in this section, unless the context
requires otherwise, 'city' means any city with a population of
300,000 or more.
(2) Notwithstanding any of the provisions of ORS 456.550 to
456.725 to the contrary:
(a) Of the $2.5 billion bond authorization under ORS 456.661,
the aggregate principal amount of not to exceed $30 million is to
be made available exclusively for making or participating in
making residential loans for detached single-family homes,
including lots described in ORS 92.840, in any city.
(b) The bonds under paragraph (a) of this subsection may be
sold as a part of the Housing and Community Services Department's
overall nongeneral obligation bond issues under ORS 456.550 to
456.725, or separate issues totaling no more than $30 million in
an aggregate principal amount may be sold by the department as
required and requested by a city. The bonds need not be
identified by individual loans or transactions but may include
any number of individual loans or transactions or purposes within
any single issue.
(c) The department may use moneys received under paragraph (b)
of this subsection to purchase, service, sell and make
commitments to purchase, service and sell residential loans
meeting all of the requirements of this paragraph. The loans must
be:
(A) Originated by private lending institutions or any
individual or organization authorized by law to make those loans,
for residential housing;
(B) For owner-occupied detached single-family housing, which
may include but is not limited to lots described in ORS 92.840;
(C) For properties located within an area of a city where the
median income is below the city's median family income; and
(D) To persons whose annual income for the current and the
immediately preceding year does not exceed 105 percent of the
prevailing median income for families within that city.
(d) Areas eligible under paragraph (c) of this subsection shall
be identified by ordinance of the governing body of that city.
That city shall have sole discretion to designate one or more of
those areas, and the proportionate or approximate actual amount
of single-family residential loans to be made in those areas.
(e) Fees or { - service - } charges pursuant to ORS 456.625
(3) shall be { - charged - } { + assessed + } or collected in
connection with, or for, any loan, advance, insurance, loan
commitments or servicing, by the department under this section
only after consultation with the city.
SECTION 16. ORS 456.612 is amended to read:
456.612. The Legislative Assembly finds and declares that the
primary purpose of financing by the Housing and Community
Services Department is to provide affordable housing for persons
and families of lower income { - or very low income - } .
SECTION 17. ORS 456.615 is amended to read:
456.615. As used in ORS 456.550 to 456.725, unless the context
requires otherwise:
(1) 'Bonds' means any bonds, notes or other evidence of
indebtedness, including notes or other evidence of indebtedness
issued in anticipation of the issuance of bonds and payable from
the proceeds of bonds issued, issued under ORS 456.515 to
456.725.
(2) 'Capital reserve account' or 'capital reserve accounts'
means one or more of the special trust accounts that may be
established by the Housing and Community Services Department
within the Housing Finance Fund.
{ - (3) 'Housing finance bond declaration' means a written
instrument signed by the Director of the Housing and Community
Services Department and on file with and bearing the certificate
of approval of the State Treasurer, and all housing finance bond
declarations supplemental thereto. - }
{ - (4) - } { + (3) + } 'Consumer housing cooperative'
means a cooperative corporation formed under ORS chapter 62 and
whose articles of incorporation provide, in addition to the other
requirements of ORS chapter 62, that:
(a) The consumer housing cooperative has been organized
exclusively to provide housing facilities for persons and
families of lower income and such social, recreational,
commercial and communal facilities as may be incidental to such
housing facilities.
(b) All income and earnings of the consumer housing cooperative
shall be used exclusively for consumer housing cooperative
purposes and that no unreasonable part of the net income or net
earnings of the cooperative shall inure to the benefit or profit
of any private individual, firm, corporation, partnership or
association.
(c) The consumer housing cooperative is in no manner controlled
or under the direction of or acting in the substantial interest
of any private individual, firm, corporation, partnership or
association seeking to derive profit or gain therefrom or seeking
to eliminate or minimize losses in any transaction therewith,
except that such limitation shall apply to the members of the
cooperative only to the extent provided by rules of the
department.
(d) The operations of the consumer housing cooperative may be
supervised by the department and that the consumer housing
cooperative shall enter into such agreements with the department
as the department may require to provide regulation by the
department of the planning, development and management of any
housing project undertaken by the cooperative and the disposition
of the property and other interests of the cooperative.
{ - (5) - } { + (4) + } 'Development costs' means the costs
that have been approved by the department as appropriate
expenditures and includes, but is not limited to { + :
(a) + } Payments for options to purchase property for the
proposed housing project site, deposits on contracts of purchase,
payments for the purchase of property as approved by the
department, legal, organizational and marketing expenses
including payment of attorney fees, managerial and clerical staff
salaries, office rent and other incidental expenses, payment of
fees for preliminary feasibility studies, advances for planning,
engineering and architectural work;
{ + (b) + } Expenses for surveys as to need and market
analyses; and
{ + (c) + } Such other expenses incurred by the qualified
housing sponsor as the department may deem necessary under ORS
456.550 to 456.725.
{ - (6) 'Elderly' means a person or a family whose head of
the household is 58 years of age or older, residing in the state,
whose income is below the level that the department has
determined to be necessary in order to obtain in the open market
decent, safe and sanitary housing, including the costs of
utilities and taxes, for 25 percent of the gross income of the
household. - }
{ - (7) - } { + (5) + } 'Federally insured security' means
an evidence of indebtedness insured or guaranteed as to repayment
of principal and interest by the United States or an agency or
instrumentality thereof.
{ - (8) - } { + (6) + } 'Housing development' means a
development that contains housing units for persons or families
of lower income and such other incidental elements of
residential, commercial, recreational, industrial, communal or
educational facilities as the department determines improve the
quality of the development as it relates to housing for persons
or families of lower income and the financial feasibility of the
development. { - Not more than 50 percent of the total amount
of any financing provided by the department for a particular
development may be used to finance commercial, recreational,
industrial, communal or educational facilities. Profits from
incidental elements shall be applied to loans due under ORS
456.550 to 456.725. - }
{ + (7) 'Housing finance bond declaration' means a written
instrument signed by the Director of the Housing and Community
Services Department and on file with and bearing the certificate
of approval of the State Treasurer, and all housing finance bond
declarations supplemental to that instrument. + }
{ - (9) - } { + (8) + } 'Housing Finance Fund' means the
Housing Finance Fund established in ORS 456.720 (1).
{ - (10) - } { + (9) + } 'Lending institution' means any
bank, mortgage banking company, trust company, savings bank,
savings and loan association, credit union, national banking
association, federal savings and loan association or federal
credit unit maintaining an office in this state, or any insurance
company authorized to do business in this state.
{ - (11) - } { + (10) + } 'Limited dividend housing
sponsor' means a corporation, trust, partnership, association
{ - , - } { + or + } other entity, or an individual { - .
Such - } { + that is a + } mortgagor { + . + } { - shall be
restricted as to distribution of income and shall be regulated as
to rents, charges, rate of return and methods of operation as the
department determines necessary to carry out the purposes of ORS
456.550 to 456.725. - }
{ - (12) 'Lower income families or persons' means the elderly
and families and persons, residing in this state, whose income is
below the level that the department has determined to be
necessary in order to obtain in the open market decent, safe and
sanitary housing, including the costs of utilities and taxes, for
25 percent of the gross income of such family or person. The term
may also include other families or persons where the assistance
provided is determined by the director to be incidental to the
accomplishment of the department's programs for lower income
families or persons. The department, in cooperation with affected
local governments, shall determine what constitutes 'decent, safe
and sanitary housing.' - }
{ + (11) 'Manufactured dwelling park nonprofit cooperative'
has the meaning given that term in section 3 of this 2007
Act. + }
{ - (13) - } { + (12) + } 'Manufactured housing' means a
dwelling unit manufactured off-site having a minimum width of 10
feet and a minimum area of 400 square feet built on a permanent
chassis and designed to be used for permanent residential
occupancy whether or not on a permanent foundation, and that
contains permanent eating, cooking, sleeping and sanitary
facilities and meets such standards as the department determines,
by rule, are reasonable to maintain the quality, safety and
durability of the dwelling, the sanitary requirements of the
communities in which they are located and the security of the
loans that the department may finance for the purchase of the
dwellings.
{ - (14) - } { + (13) + } 'Nonprofit housing corporation'
means an organization formed under ORS chapter 65 and whose
articles of incorporation provide, in addition to the other
requirements of ORS chapter 65, that:
(a) The corporation has been organized exclusively to provide
housing facilities for persons and families of lower income and
such other social, recreational, commercial and communal
facilities as may be incidental to such housing facilities.
(b) All the income and earnings of the corporation shall be
used exclusively for corporation purposes and that no part of the
net income or net earnings of the corporation may inure to the
benefit of any private individual, firm, corporation, partnership
or association.
(c) The corporation is in no manner controlled or under the
direction or acting in the substantial interest of any private
individual, firm, partnership or association seeking to derive
profit or gain therefrom or seeking to eliminate or minimize
losses in transactions therewith.
(d) The operations of the corporation may be supervised by the
department and that the corporation shall enter into such
agreements with the department as the department may require to
regulate the planning, development and management of any housing
project undertaken by the corporation and the disposition of the
property and other interests of the corporation.
{ + (14) 'Person of lower income' or 'family of lower income
' means a person or family residing in this state whose income is
not more than 80 percent of area median income, adjusted for
family size, as determined by the State Housing Council based
upon information from the United States Department of Housing and
Urban Development. + }
(15) 'Project cost' or 'costs of the project' means the sum of
all reasonable expenses incurred by a qualified housing sponsor
in undertaking and completing a housing project approved by the
department. 'Project costs' or 'costs of the project ' include
but are not limited to the expenses incurred by a qualified
housing sponsor for:
(a) Studies and surveys;
(b) Plans, specifications, architectural and engineering
services;
(c) Legal, organizational and other special services;
(d) Financing, acquisition, demolition, construction, equipment
and site development of new and rehabilitated housing units;
(e) Movement of existing buildings to new sites; the cost of
acquisition, or estimated fair market value, of land and other
interests in real estate;
(f) Rehabilitation, reconstruction, repair or remodeling of
existing buildings;
(g) Estimated carrying charges during construction and for a
reasonable period thereafter;
(h) Placement of tenants or occupants and relocation services
in connection with the housing project;
(i) Reasonable builder's or sponsor's profit and risk
allowance; and
(j) Development costs not otherwise included in this
subsection.
(16) 'Qualified housing sponsor' includes, subject to the
approval of the department { - , - } { + :
(a) + } A consumer housing cooperative { - , - } { + ;
(b) + } A limited dividend housing sponsor { - , - } { + ;
(c) + } A nonprofit housing corporation { - , - } { + ;
(d) + } A for-profit housing sponsor including, but not limited
to, an individual operating in compliance with the criteria
adopted by the department under ORS 456.620 (1) { - , - } { + ;
(e) + } A housing authority created by ORS 456.075 { - , - }
{ + ;
(f) + } An urban renewal agency created by ORS
457.035 { + ; + } and
{ + (g) + } Any city or county governing body or agency or
department designated by the governing body.
(17) 'Residential housing' means a specific work or improvement
within this state undertaken primarily to provide dwelling
accommodations, including land development and acquisition,
construction or rehabilitation of buildings and improvements
thereto, for residential housing, and such other nonhousing
facilities as may be incidental or appurtenant thereto and as the
department determines improve the quality of the development as
it relates to housing for persons or families of lower income and
the financial feasibility of the development.
{ - Not more than 50 percent of the total amount of any
financing provided by the department for a particular development
may be used to finance nonhousing facilities. - } 'Residential
housing ' includes, but is not limited to, a specific work or
improvement within this state undertaken to provide mobile home
or manufactured dwelling parks as defined in ORS 446.003. As used
in this subsection, 'land development' includes, but is not
limited to, the improvement of streets and alleys and the
construction of surface drains, sewers, curbing and sidewalks.
(18) 'Residential loan' means { + any of the following:
(a) + } A loan { + that is + } for the acquisition,
construction, improvement or rehabilitation of residential
housing and, if the loan is for acquisition or construction of
residential housing, that is secured by a first lien on real
property located in the state and { + :
(A) + } Improved by a newly constructed, existing or
rehabilitated residential structure for { - lower income - }
persons or families { + of lower income + } { - , - }
{ + ; + } or
{ + (B) + } Unimproved if the proceeds of such loan shall be
used for the erection of a residential structure thereon, whether
or not such loan is insured or guaranteed by the United States or
any instrumentality or agency thereof.
{ + (b) + } { - ' Residential loan' includes - } An
insured or guaranteed loan for the acquisition of manufactured
housing or for the acquisition of a lot described in ORS 92.840
by a manufactured dwelling park tenant. { - The insured or
guaranteed loan need not be secured by a first mortgage on real
property but shall be secured by a security interest of first
priority. 'Residential loan ' also includes - }
{ + (c) + } A loan for the purchase of a proprietary lease
and related cooperative shares in a housing cooperative formed
under ORS chapter 62 secured by a security interest of first
priority and a pledge or an assignment of proprietary leases and
related cooperative shares.
(19) 'Revolving account' means the Housing and Community
Services Department Revolving Account created in ORS 456.574.
SECTION 18. ORS 456.625 is amended to read:
456.625. The Housing and Community Services Department may:
(1) Undertake and carry out studies and analyses of housing
needs within the state and ways of meeting such needs and make
the results of such studies and analyses available to the public,
qualified housing sponsors and the private housing sector.
(2) Prepare proposals on measures it considers necessary to
address administration, housing programs or community services
programs.
(3) With the approval of the State Housing Council,
{ - charge - } { + assess + } fees { + , charges + } or
interest in connection with housing programs.
(4) Encourage community organizations to assist in initiating
housing projects for persons and families of lower income.
(5) Encourage the salvage of usable housing scheduled for
demolition or dislocation because of highway, school, urban
renewal or other public projects by seeking authority for the
public agencies involved in such programs to use the funds
provided for the demolition or relocation of such buildings to
enable qualified housing sponsors to relocate and rehabilitate
such buildings for use by persons and families of lower income.
(6) Encourage research and demonstration projects to develop
techniques and methods for increasing the supply of adequate,
decent, safe and sanitary housing for persons and families of
lower income.
(7) Make or participate in the making of residential loans to
qualified individuals or housing sponsors to provide for the
acquisition, construction, improvement, rehabilitation or
permanent financing of residential housing or housing
development; undertake commitments to make residential loans;
purchase and sell residential loans at public or private sale;
modify or alter such mortgages or loans; foreclose on any such
mortgage or security interest or commence any action to protect
or enforce any right conferred upon the department by any law,
mortgage, security, agreement, contract or other agreement and to
bid for and purchase property that is subject to such mortgage or
security interest at any foreclosure or other sale; acquire or
take possession of any such property and complete, administer,
conserve, improve and otherwise use the property to accomplish
the department's purposes, pay the principal and interest on any
obligations incurred in connection with such property and dispose
of such property in such manner as the department determines
necessary to protect its interests under ORS 456.515 to 456.725
and ORS chapter 458.
(8) Unless specifically exempted by the State Treasurer,
deposit with the State Treasurer any funds held in reserve or
sinking funds under ORS 456.515 to 456.725 and ORS chapter 458
and any other moneys not required for immediate use or
disbursement by the department, subject to the provisions of any
agreement with holders of bonds entered into prior to October 15,
1983.
(9) Advise and assist in the creation of any nonprofit housing
corporation, consumer housing cooperative or limited dividend
housing sponsor and give approval of the articles of
incorporation and bylaws of any such organization in carrying out
ORS 456.515 to 456.725.
(10) Cooperate with and exchange services, personnel and
information with any federal, state or local governmental agency.
(11) Contract for the services of and consultation with
professional persons or organizations, not otherwise available
through federal, state or local governmental agencies, in
carrying out ORS 456.515 to 456.725 and ORS chapter 458.
(12) Contract for, act on or perform any other duties that the
department considers necessary or appropriate to carry out
housing programs and community services programs.
(13) Purchase, service, sell and make commitments to purchase,
service and sell residential loans to the extent permitted by ORS
456.635 and 456.640 (1) to (3).
(14) Initiate or assist appropriate state agencies,
governmental bodies and public or private housing sponsors in the
development, construction, acquisition, ownership, leasing,
rehabilitation or management of housing to carry out the purposes
of ORS 456.515 to 456.725 and ORS chapter 458 where such housing
is not otherwise affordable or available in the area.
(15) Execute and record written instruments that contain terms,
including but not limited to restrictive covenants or equitable
servitudes, pertaining to the use and enjoyment of housing
projects. Notwithstanding any other provision of law, the
executed instruments shall constitute and create restrictive
covenants affecting and running with the property according to
the terms of the instruments when recorded in the records of the
county where the property is located. County clerks shall accept
the instruments for recording when presented by or on behalf of
the department.
(16) Subject to the provisions of any agreement then existing
with bondholders, make available funds by contract, grant, loan
or otherwise, including loan guarantees, insurance or other
financial leveraging techniques, from moneys made available by
the department to carry out the purposes of ORS 456.515 to
456.725, if such moneys are not needed for the operations of the
department or otherwise determined by the director to be a
necessary or prudent reserve.
SECTION 19. ORS 456.630 is amended to read:
456.630. The Housing and Community Services Department may
provide { - to - } qualified housing sponsors and lending
institutions
{ - such - } { + with + } advisory, consultative training and
educational services as necessary { - in assisting such - }
{ + to assist those + } sponsors. { - Such - } { + For
purposes of this section, + } advisory and other services
include, but are not limited to { - , - } { + :
(1) + } Technical and professional planning assistance
{ - , - } { + ;
(2) Technical assistance for forming and operating manufactured
dwelling park nonprofit cooperatives;
(3) + }Preparation and promulgation of organizational planning
and development guidelines { - , - } { + ;
(4) + } Consultation services { - , - } { + ;
(5) + } Training courses, seminars and lectures { + ; + } and
{ + (6) + } Other services or materials for assistance of
{ - such - } { + qualified housing + } sponsors in the
planning, development and management of housing projects under
ORS 456.550 to 456.725.
SECTION 20. ORS 456.690 is amended to read:
456.690. (1) Upon a finding made by the State Housing Council
that the supply of funds available through lending institutions
for the financing of residential loans for the acquisition,
construction, improvement or rehabilitation of housing
units { + , manufactured dwellings, manufactured dwelling parks,
manufactured dwelling park nonprofit cooperatives + } or housing
projects for persons and families { - of lower income - }
{ + whose income does not exceed maximum household income limits
established by the Housing and Community Services Department
under ORS 456.620 (4) + }is inadequate, the { - Housing and
Community Services - } department may make loans to lending
institutions in this state for the purpose of providing funds to
such institutions for the financing of residential housing
units { + , manufactured dwellings, manufactured dwelling parks,
manufactured dwelling park nonprofit cooperatives + } or housing
projects { + , + } for persons and families { - of lower
income - } { + whose income does not exceed maximum household
income limits established by the department under ORS 456.620
(4) + }.
(2)(a) The department, subject to existing agreements with
bondholders, may make privately or federally insured or
guaranteed loans for { + the + } rehabilitation or improvement
of existing single-family homes for { - lower income - }
persons and families { + of lower income, manufactured dwellings
for persons and families of lower income or manufactured dwelling
parks and manufactured dwelling park nonprofit cooperatives that
the department determines have a significant percentage of
residents who are persons of lower income, + } if the department
finds that:
(A) The supply of funds available through private lending
institutions for that purpose is inadequate; and
(B) The housing may be rehabilitated or improved to provide
adequate, safe and sanitary residential housing.
(b) The department may cooperate with qualified housing
sponsors in the development and implementation of such loan
programs. Loans made by the department under this subsection
shall be made for single-family homes.
(3) Prior to the making of any loan under this section, the
department, with the approval of the council, shall adopt rules
governing the making of such loans, including but not limited to:
(a) Procedures for the submission, review and approval of
requests for loans under this section.
(b) Standards and requirements for the allocation of loan
moneys available among eligible borrowers and the determination
of the terms, conditions and interest rates for such loans.
(c) Limitations, if any, on the number of housing units or
projects, type of housing units or projects and any other
characteristics for the eligibility of housing units or projects
for such financing.
(d) Restrictions, if any, on the interest rates to be charged
by lending institutions on loans made from such loan proceeds and
the return to be realized by the lending institution therefrom.
(e) Commitment requirements applied to residential mortgage
financing by lending institutions from the proceeds of such
loans.
(f) Schedules of fees and { - other - } charges to be made
by the department in accepting, reviewing and acting upon
applications for loans under this section.
(4) The department shall administer the loan program for
rehabilitation or improvement of existing single-family homes for
{ - lower income - } persons and families { + of lower
income + } in accordance with the following requirements and loan
criteria:
(a) Eligibility for a loan shall be based on current department
income limitations.
(b) A loan may be assumed only by another { - lower
income - } person { + of lower income + }.
(c) The single-family home for which a loan is made must be
owner-occupied.
(d) The maximum principal amount of a single loan is $15,000.
(e) An eligible borrower shall have only one loan outstanding
under this program at any one time.
(f) An eligible improvement including, but not limited to, a
remodeling project shall be defined by rule and the provisions of
the Revenue Adjustments Act of 1980 (Public Law 96-499), as
adopted December 5, 1980, shall be recognized in that definition.
(g) Loans shall be made in accordance with a distribution of
population between urban and rural areas that takes the
availability of alternative resources into account.
(h) The department shall work with qualified housing sponsors
whenever it is appropriate to do so.
(5) All loans made and all rules adopted under this section
shall be designed by the department, with the approval of the
council, to expand the supply of funds available in this state
for the financing of residential housing units { + , manufactured
dwellings, manufactured dwelling parks, manufactured dwelling
park nonprofit cooperatives + }and housing projects { + , + }
for persons and families { - of lower income - } { + whose
income does not exceed maximum household income limits
established by the department under ORS 456.620 (4) + }, to
provide an adequate supply of safe and sanitary units of such
housing, and to promote the effective participation of
conventional lending institutions in the financing of such
housing and restrict the financial return and benefit to such
lenders to that which is necessary and reasonable to induce their
participation under this section.
(6) In making loans under this section, the department, with
the approval of the council, may prescribe such terms,
conditions, maturity dates and interest rate provisions as it
considers necessary.
SECTION 21. ORS 456.705 is amended to read:
456.705. { - With respect to - } { + For + } the servicing
of any residential { + , manufactured dwelling, manufactured
dwelling park or manufactured dwelling park nonprofit
cooperative + } loan made or acquired by the Housing and
Community Services Department under ORS 456.515 to 456.725 and
ORS chapter 458 the department may:
(1) Provide for servicing of the { - residential - } loan by
its own staff.
(2) Contract with the Director of Veterans' Affairs for the
performance of servicing functions for the { - residential - }
loan.
(3) { - With respect to residential - } { + For + } loans
purchased by the department under ORS 456.635, contract with the
lending institution selling such loans or any other lending
institution for the servicing of such loans, subject to such
terms and conditions as the department considers necessary to
protect the interests of the department in such loans. The
department may provide for the payment of such fees for servicing
performed by a lending institution under this subsection as it
considers necessary.
SECTION 22. ORS 456.710 is amended to read:
456.710. (1) The Housing and Community Services Department may
use moneys in the revolving account to make noninterest-bearing
advances to qualified nonprofit housing sponsors or
interest-bearing advances to other qualified housing sponsors for
use in payment by such sponsors of the development costs of
proposed housing units or projects. The department may not make
any advance under this subsection unless the department may
reasonably anticipate that a residential { + , manufactured
dwelling, manufactured dwelling park or manufactured dwelling
park nonprofit cooperative + } loan may be obtained by the
qualified housing sponsor for the permanent financing of the
proposed housing unit or project.
(2) The proceeds of any advance granted by the department under
subsection (1) of this section may be used by the qualified
housing sponsor only for the development costs of a proposed
housing unit or project or housing development. Each advance so
granted shall be repaid in full, by the qualified housing sponsor
for which the advance was granted, to the department at the time
of the receipt by the housing sponsor of the portion of the
{ - residential - } loan paid under the initial indorsement of
the
{ - residential - } loan, unless the department extends the
repayment period. { - In no event shall the time of repayment
be extended beyond the date of the receipt by - } { + The
department may not extend the repayment period past the date
+ }the qualified housing sponsor
{ - of - } { + receives + } the portion of the
{ - residential - } loan paid on final indorsement of the
{ - residential - } loan.
SECTION 23. ORS 456.715 is amended to read:
456.715. (1) The Housing and Community Services Department may
insure residential { + , manufactured dwelling, manufactured
dwelling park and manufactured dwelling park nonprofit
cooperative + } loans or obtain reinsurance on such loans.
{ - However, - } All such loans shall be used only to provide
residential housing for persons and families of lower income and
the insured must agree to any restrictions placed upon such
residential housing by the department. The department may
establish dedicated accounts within the Housing Finance Fund to
provide reserves against losses in connection with that
insurance.
(2) All applications for residential loan insurance under
subsection (1) of this section shall be made on such forms and
accompanied by such application fee as the department may
prescribe.
(3) The department shall notify the applicant of its
{ - findings - } { + determinations + } and the approval or
denial of the application.
{ + (4) Notwithstanding subsection (1) of this section, the
department may insure loans for manufactured dwelling units,
manufactured dwelling parks and manufactured dwelling park
nonprofit cooperatives if the department determines that the
unit, park or cooperative has a significant percentage of
residents who are persons of lower income. + }
SECTION 24. ORS 458.215 is amended to read:
458.215. The Housing and Community Services Department may
establish a program to build local capacity to address any or a
combination of the following:
(1) Housing needs of people, with low or moderate incomes, for
homeownership and affordable rental housing;
(2) The problem of abandoned houses;
(3) The need for adequate housing for seasonal farm laborers;
(4) Housing problems for low and moderate income elderly and
disabled persons;
(5) The need to incorporate social service programs as a
component of community economic development; { - and - }
{ + (6) The preservation of manufactured dwelling parks that
the department determines house a significant percentage of
persons and families of lower income; and + }
{ - (6) - } { + (7) + } The need to incorporate related
jobs for low and moderate income persons as a component of
community economic revitalization.
SECTION 25. ORS 458.630 is amended to read:
458.630. (1)(a) The Housing and Community Services Department
may hold and use the principal that is credited to the Housing
Development and Guarantee Account as the Guarantee Fund. The
department may use the fund to guarantee repayment of loans made
to finance the construction, development, acquisition or
rehabilitation of low income housing, of the commercial component
of a structure that contains both commercial property and low
income housing, or of both. The department, by rule, shall
specify the grounds on which it may deny loan guarantees for a
structure that contains both commercial and low income housing
components. The grounds for denial specified by the department
must include, but need not be limited to, a commercial component
that is excessive in scope or that is designed for commercial
activity of a type incompatible with residential housing. The
State Housing Council shall review loans that are guaranteed by
the fund to ensure that the loans meet prudent underwriting
standards.
(b) A guarantee may not be prepared or construed in such a
manner as to violate the provisions of section 7, Article XI of
the Oregon Constitution.
(2) The department may not issue any loan guarantee under this
section that guarantees the repayment of more than { - 25 - }
{ + 50 + } percent of the original principal balance of any
loan.
(3) The department may not issue a loan guarantee if the
guarantee would cause the aggregate dollar total of all loan
guarantees issued by the department under this section to exceed
two times the total amount then in the Guarantee Fund established
under subsection (1) of this section. Notwithstanding ORS
458.625, whenever payouts on loan guarantees cause the fund
principal to decrease by five percent or more, the interest on
the fund shall be deposited only to the principal account until
the amount of the fund principal lost due to payouts on loan
guarantees is restored.
(4) Subject to council review under subsection (1) of this
section, the department shall give preference for loan guarantees
under this section to loans for the construction, development,
acquisition or rehabilitation of low income housing, or of
structures containing both commercial and low income housing
components, that the department determines will:
(a) Provide the greatest number of low income housing units
constructed, acquired, developed or rehabilitated for the amount
of guarantee allowed;
(b) Ensure the longest possible use for the units as low income
housing units. Pursuant to this end, the State Housing Council
may adopt a formula that optimizes the interests of the lender
and the developer and the working life of the low income units;
or
(c) Include a program of services for the occupants of the
proposed housing including, but not limited to, programs that
address home health care, mental health services, alcohol and
drug treatment and post-treatment care, child care and case
management.
(5) The council may adopt a policy that gives loan guarantee
preference to loans for low income housing, or structures
containing both commercial and low income housing components, for
which the department has provided a grant, loan, tax credit or
other investment.
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