75th OREGON LEGISLATIVE ASSEMBLY--2009 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 238
House Bill 2297
Ordered printed by the Speaker pursuant to House Rule 12.00A (5).
Presession filed (at the request of House Interim Committee on
Judiciary for American Federation of State, County and
Municipal Employees)
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.
Requires Housing and Community Services Department to establish
program to assist public safety officers in purchasing primary
residences in distressed areas.
A BILL FOR AN ACT
Relating to residence purchases by public safety officers.
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + Sections 2 to 5 of this 2009 Act are added to
and made a part of ORS 456.548 to 456.725. + }
SECTION 2. { + (1) As used in this section and section 3 of
this 2009 Act, 'public safety officer' has the meaning given that
term in ORS 181.610.
(2) The Housing and Community Services Department shall
establish a program to assist public safety officers in
purchasing primary residences in distressed areas. Subject to any
restrictions on use of moneys imposed by federal law or bond
agreements, the department shall provide purchase assistance
under the program without regard to purchaser income. The
department shall make purchase assistance available under the
program if:
(a) On the date the purchase closes, the purchaser is employed
as a public safety officer;
(b) The purchaser states an intention to use the property
purchased under the program as the purchaser's primary residence;
(c) On the date the purchase closes, the purchaser does not own
any other residential property;
(d) The property purchased under the program contains an
existing single family dwelling for which the department or a
qualified housing sponsor is an owner, lender or loan guarantor;
(e) The property is located in an area that the department has
designated a distressed area as provided under section 5 of this
2009 Act; and
(f) The property meets any additional eligibility criteria
established by the department by rule. + }
SECTION 3. { + (1) Except as provided in this subsection, the
Housing and Community Services Department shall provide purchase
assistance to a public safety officer under section 2 of this
2009 Act in the form of a second mortgage on the property
purchased under the program. The second mortgage amount shall be
for the lesser of 50 percent of the property purchase price or 50
percent of the threshold property purchase price established by
department rule under ORS 456.555 (9), except that the State
Housing Council may approve a second mortgage under ORS 456.561
for the greater of those two amounts. The department may pay
closing costs and fees for a property purchase, but must reduce
the amount of the second mortgage by an equal amount.
(2) The department shall declare the second mortgage debt to be
satisfied in full and promptly file with the appropriate county
clerk a release of any encumbrance on the property by the second
mortgage if the purchaser complies with the employment and
occupancy conditions and verification requirements described in
subsections (3) and (4) of this section for the first three years
of the second mortgage.
(3) The department may not declare any payment of principal on
the second mortgage to be due or collect interest on the second
mortgage if, for the first three years of that mortgage, the
purchaser continues to:
(a) Be employed full-time or part-time as a public safety
officer; and
(b) Occupy the property as a primary residence.
(4) The department shall require the purchaser to annually
verify that the purchaser continues to meet the employment and
occupancy conditions described in subsection (3) of this section.
The department may also require the purchaser to provide
additional verifications of employment and occupancy as the
department deems necessary.
(5) An encumbrance on a property created at any time by a loan
for improvements, repairs or modifications necessary to make the
property habitable, accessible or visitable, is superior in right
to any encumbrance created by the department's second mortgage on
the property. + }
SECTION 4. { + If a purchaser subject to the employment and
occupancy conditions and verification requirements described in
section 3 of this 2009 Act fails to comply with those conditions
and requirements, the Housing and Community Services Department:
(1) May prohibit the purchaser from selling the property for an
amount that is more than the total of 110 percent of the property
purchase price plus 100 percent of all amounts paid by the
purchaser for improvements, repairs or modifications necessary to
make the property habitable, accessible or visitable;
(2) Shall require payment of all or part of the second mortgage
principal in an amount that may not be less than:
(a) 90 percent of the second mortgage principal if the failure
occurred less than one year following issuance of the second
mortgage;
(b) 60 percent of the second mortgage principal if the failure
occurred at least one year, but less than two years, following
issuance of the second mortgage; and
(c) 30 percent of the second mortgage principal if the failure
occurred at least two years following issuance of the second
mortgage; and
(3) May charge interest permitted by the second mortgage
agreement or department rule on all or part of the second
mortgage debt for the periods in which the purchaser failed to
comply with the conditions or requirements. + }
SECTION 5. { + A qualified housing sponsor may submit a
request to the Housing and Community Services Department to have
an area designated a distressed area. The department may
designate an area a distressed area if, based on information
provided by the qualified housing sponsor, the department finds
any of the following:
(1) The area has a median household income that does not exceed
60 percent of the median household income for:
(a) The metropolitan area, if the area is located in a
metropolitan area; or
(b) The state, if the area is not located in a metropolitan
area.
(2) The area has a rate of foreclosure on single family
dwellings for which the department or a qualified housing sponsor
is an owner, lender or loan guarantor that:
(a) Is substantially higher than the rate of foreclosure on
similar properties in the surrounding areas; or
(b) Has or may have a substantial detrimental impact on the
area.
(3) The area has a rate of home ownership that is substantially
less than the rate of home ownership for:
(a) The metropolitan area, if the area is located in a
metropolitan area; or
(b) The state, if the area is not located in a metropolitan
area. + }
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