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HOUSING AND COMMUNITY SERVICES DEPARTMENT

 

DIVISION 5

GENERAL RULES

813-005-0001

General Purpose

OAR chapter 813, division 5, is promulgated to accomplish the purpose of describing certain common terms, policies and procedures with respect to the administration of the Housing and Community Services Department.

Stat. Auth.: ORS 90.630, 90.771 - 90.775, 90.800 - 90.840, 183, 315.271, 317.097, 446.525 - 446.543, 456.515 - 456.725, 458.210 - 458.365, 458.405 - 458.460, 458.505 - 458.740, 566.310 - 566.350 & 757.612 - 757.617
Stats. Implemented: ORS 90.630, 90.771 - 90.775, 90.800 - 90.840, 183, 315.271, 317.097, 446.525 - 446.543, 456.515 - 456.725, 458.210 - 458.365, 458.405 - 458.460, 458.505 - 458.740, 566.310 - 566.350 & 757.612 - 757.617
Hist.: OHCS 1-2005(Temp), f. & cert. ef. 8-4-05 thru 1-31-06; OHCS 3-2006, f. & cert. ef. 1-31-06; OHCS 14-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; OHCS 18-2013, f. & cert. ef. 12-18-13

813-005-0005

Definitions

(1) Terms used in OAR chapter 813 have the meanings given them in the Act, in this section, otherwise in OAR chapter 813 or in other applicable law, unless the context indicates to the contrary. Such terms need not be capitalized. Undefined terms are intended to be read consistently with their normal usage unless the context indicates otherwise.

(2) Pursuant to ORS 456.555(5)(b) the Housing and Community Services Department by administrative rule, must identify and distinguish between housing programs and community services programs. Any program administered by the department (as principal and not agent) that is not listed in this subsection, does not principally involve the financing, regulation, maintenance or support of housing or home ownership or otherwise defined in statute or in this chapter as a housing program is a "community service program." Accordingly, the following programs administered by the department are housing programs:

(a) Multi-Unit Housing Program (OAR 813-010);

(b) Rental Housing Program (OAR 813-012);

(c) Oregon Rural Rehabilitation Program (OAR 813-015);

(d) Single-Family Mortgage Program (OAR 813-020);

(e) Elderly Housing Program (OAR 813-030);

(f) Pass-Through Revenue Bond Financing Program (OAR 813-035);

(g) Pre-Development Program (OAR 813-038);

(h) Farmworker Housing Development Account (OAR 813-039);

(i) Seed Money Advance Program (OAR 813-040);

(j) Farmworker Housing Tax Credit Program (OAR 813-041);

(k) Housing Development Program (OAR 813-042);

(l) Housing Loan Guarantee Program (OAR 813-043);

(m) Homeownership Assistance Program (OAR 813-044);

(n) Housing Development Account Program (813-045);

(o) Emergency Housing Program (OAR 813-046);

(p) Housing Revitalization Program (OAR 813-048);

(q) Disabled Housing Program (OAR 813-060);

(r) Home Improvement Loan Program (OAR 813-070);

(s) Mortgage Credit Certificate Program (OAR 813-080);

(t) Low-Income Housing Tax Credit Program (OAR 813-090);

(u) Oregon Affordable Housing Tax Credit Program (OAR 813-110);

(v) Home Investment Partnerships Program (OAR 813-120);

(w) HELP Program (OAR 813-130);

(x) Incentive Fund Program (OAR 813-140);

(y) Subsidized Development Visitability Program (OAR 813-310);

(z) General Guarantee Program (OAR 813-350); and

(aa) Other activities of the department involving the financing, regulation, maintenance or support of housing or home ownership or that otherwise are defined in statute or in this chapter as a housing program.

(3) Pursuant to ORS 456.555, the Housing and Community Services Department is to establish from time to time, by administrative rule, the threshold property purchase price at which a single-family home ownership loan on property must be submitted by the department to the State Housing Council for approval or disapproval as well as the threshold value for a housing grant or other housing funding award for multifamily housing. Presently, the threshold property purchase price for single-family home ownership that obligates the department to obtain State Housing Council review and approval of a proposed single-family loan is that purchase price which, when reduced by costs of purchase other than the department loan, is equal to or greater than seventy-five percent of the applicable area program purchase price limit or $190,000, whichever is greater. The threshold value of a housing grant or other housing funding award with respect to a multifamily housing development (project) that obligates the department to obtain State Housing Council review and approval is $200,000 per funding source with an aggregate threshold per project of $400,000.

(4) "Acquisition loan" means a loan for the purpose of financing the purchase of an existing Project.

(5) "Act" means ORS 456.515 through 456.725 and, given the context, also may include 458.005 through 458.740, 90.800 through 90.840, and 91.886.

(6) "Approved lender" means any person authorized to engage in the business of making loans of the general character of program loans, who meets the qualifications for an approved lender set forth in the applicable program rules and who contracts with the department to make program loans.

(7) "Approved servicer" means any person authorized to engage in the business of servicing loans of the general character of program loans, who meets the qualifications for an approved servicer set forth in the applicable program rules and who contracts with the department to service program loans.

(8) "Bond" means any bond, note or other evidence of indebtedness issued to obtain funds to provide financing for a program of the department as provided in the Act or as further defined by statute.

(9) "Borrower" means an eligible borrower who has received a program loan.

(10) "Break-even occupancy" means the point in time when a project's monthly rental income meets its monthly operating expenses and debt service.

(11) "Commitment" means the written conditional obligation of the department to make, purchase, service or sell a program loan or other funding award.

(12) "Community service programs" are defined in subsection (2) of this section.

(13) "Contingency escrow account" means an account generally not to exceed 3% of the initial principal amount of the program loan, established by the sponsor in the form of a savings account, time certificate of deposit, or irrevocable letter of credit assigned to the department.

(14) "Cooperative" is a consumer housing entity formed according to the provisions of ORS Chapter 62, as amended.

(15) "Department" means the Housing and Community Services Department of the state of Oregon established pursuant to ORS 456.555 originally enacted by enrolled House Bill 3377, chapter 739, Oregon Laws 1991.

(16) "Director" means the chief administrative officer of the Housing and Community Services Department established pursuant to ORS 456.555(2).

(17) "Elderly household" means a household residing in the state of Oregon whose head is over the age of 58 or 55, as applicable.

(18) "Eligible borrower" means a person who satisfies the criteria to receive a program loan as set forth in the applicable program rules, statutes or department orders.

(19) "Escrow payments" means the monthly payments made by the sponsor or borrower and placed in an escrow reserve account for the payment of property taxes, insurance premiums and reserve for replacements and other identified costs as required by the department in accordance with the program loan.

(20) “Funding documents” means any and all documents required by the department to document a housing grant or other funding award or reservation commitment including, but not limited to loan agreements, regulatory agreements, operating agreements, reservation letters, guarantees or otherwise.

(21) "Housing Council" or "State Housing Council" means that seven-member body established by ORS 456.

(22) "Housing programs" are defined in subsection (2) of this section.

(23) "Lending department" means a commercial bank, savings and loan association, savings bank, mortgage banker Federal Housing Administration, Farmers Home Administration or other department that provides permanent or construction mortgage loans.

(24) "Loan agreement" means a written agreement, typically executed at loan closing, between the department and a sponsor establishing the terms of any department loan.

(25) "Loan closing" means the disbursement by the department of the program loan proceeds after execution and recording of the loan documents.

(26) "Loan documents" means the written agreements by and between the sponsor and the department or in favor of the department, typically executed at loan closing, and generally including, but not necessarily limited to the promissory note, the loan agreement, the trust deed and the regulatory agreement.

(27) "Mobile home park" means a project consisting of individual lots and mobile homes located within 500 feet of one another on a lot, tract or parcel of land under the same ownership, and which complies with all ordinances, plans and codes in the area.

(28) “NOFA” means a notice of funding availability.

(29) "Operating agreement and declaration of restrictive covenants and equitable servitudes" or "operating agreement" means a written agreement typically executed at loan closing between the department and the sponsor of a project under the department's pass-through revenue bond program and regulating the use of revenues and operation of the project, particularly with respect to tenant income and unit rent compliance by the sponsor.

(30) "Person" means any natural or legal person.

(31) "Procedural guide" means a manual of written procedures adopted by the department to carry out a program.

(32) "Program" means a statutorily authorized plan or order of business conducted by the department.

(33) "Program loan" means a loan made pursuant to a program of the department.

(34) “Program requirements” means the requirements with respect to any department funding program including but not limited to as contained in or arising from applicable administrative rules, solicitation documents, funding documents, department directives, federal, state and local statutes, codes, regulations or determinations and other applicable law.

(35) "Qualified insurer" means the Federal Housing Administration, the Veterans' Administration, or any other person who is authorized to insure or guarantee payment of loans and who is approved by the department.

(36) "Regulatory agreement and declaration of restrictive covenants and equitable servitudes" or "regulatory agreement" means a written agreement typically executed at loan closing between the department and a sponsor regulating the use of revenues and operation of the project for which a department loan is issued, particularly pertinent with respect to compliance by the sponsor with maintaining the status of any involved bond issue.

(37) "Rent-up reserve account" means an account set up by the sponsor and under the control of the department to assure sufficient funds to pay operating expenses and debt service of the project before break-even occupancy.

(38) "Replacement cost reserve account" means an account established to aid in payment for extraordinary maintenance or repair of a project or for replacement of capital items of a project as allowed by the department.

(39) "Seed money advance" means an advance given to a qualified housing sponsor to pay preconstruction costs.

(40) "Single-family residence" means a housing unit intended and used for occupancy by one household and the property on which it is located. This shall be real property located in the state of Oregon. A single-family residence may include a single-family residence, condominium unit, a dwelling in a planned unit development (PUD), or a mobile or manufactured home which has a minimum of 400 square feet of living space and a minimum width in excess of 102 inches and is of a kind customarily used at a fixed location.

(41) “Solicitation” means a process by which the department invites applications for a housing grant or other funding award with respect to a project.

(42) “Solicitation documents” means those documents that, inter alia, set forth the terms and conditions of a solicitation.

(43) "Sponsor" means any person meeting the legal, financial, credit and other qualifications to be the borrower on a department loan and to own and operate a project as set forth in the applicable program rules, statutes and department orders.

(44) "Targeted area" means an area in the state designated by the department in compliance with the requirements of Section 143(j) of the Internal Revenue Code of 1986, as amended, and approved by the United States Departments of Treasury and Housing and Urban Development.

(45) "Trustee" means the state treasurer or, with the approval of the department, a private financial institution in Oregon acting pursuant to an indenture of trust or other appropriate instrument.

[Publications: Publications referenced are available from the agency.]

Stat. Auth.: ORS 90.630, 90.771 - 90.775, 90.800 - 90.840, 183, 315.271, 317.097, 446.525 - 446.543, 456.515 - 456.725, 458.210 - 458.365, 458.405 - 458.460, 458.505 - 458.740, 566.310 - 566.350 & 757.612 - 757.617
Stats. Implemented: ORS 456.515 - 456.720
Hist.: 1HD 7-1984, f. & ef. 9-4-84; HSG 1-1987(Temp), f. & ef. 2-5-87; HSG 5-1987, f. & ef. 3-10-87; Renumbered from 813-001-0006; HSG 3-1989(Temp), f. & cert. ef. 6-8-89; HSG 5-1989, f. & cert. ef. 11-3-89; HSG 2-1991(Temp), f. & cert. ef. 8-7-91; HSG 8-1991, f. & cert. ef. 12-23-91; OHCS 1-2005(Temp), f. & cert. ef. 8-4-05 thru 1-31-06; OHCS 3-2006, f. & cert. ef. 1-31-06; OHCS 14-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; OHCS 18-2013, f. & cert. ef. 12-18-13; OHCS 25-2014(Temp), f. & cert. ef. 4-17-14 thru 10-14-14

813-005-0016

Waiver

The director may waive, suspend or modify any term or provision of OAR 813, unless such waiver, suspension or modification would violate applicable federal or state law.

Stat. Auth.: ORS 91.886, 183 & 456.555
Stats. Implemented: ORS 90.800 - 90.840, 91.886, 456.515, 456.725 & 458.005 - 458.740
Hist.: OHCS 1-2005(Temp), f. & cert. ef. 8-4-05 thru 1-31-06; OHCS 3-2006, f. & cert. ef. 1-31-06; OHCS 14-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; OHCS 18-2013, f. & cert. ef. 12-18-13

813-005-0020

General Policy and Guideline Manual

The General Policy and Guideline Manual, as amended from time to time, is incorporated into this Division by reference and has application, inter alia, to the solicitation, review, reservation, award and documentation of housing grants and other funding awards with respect to affordable multifamily housing projects as well as to the operation and compliance of such projects with applicable habitability, affordability and other requirements irrespective of the program source of funding.

Stat. Auth.: ORS 91.886, 317.097 & 456.555
Stats. Implemented: ORS 90.800 - 90.840, 91.886, 317.097, 456.515 - 456.725 & 458.005 - 458.740
Hist.: OHCS 14-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; OHCS 18-2013, f. & cert. ef. 12-18-13; OHCS 25-2014(Temp), f. & cert. ef. 4-17-14 thru 10-14-14

813-005-0030

Contingency of Funding Awards

If the department provides a reservation or otherwise to make a funding award under ORS 90.800 - 90.840, 91.886, ORS 317.097, 456.515 through 456.725 or 458.005 through 458.740, and if the type and amount of subject funding or any other department funding approved by the department that was considered by the department in setting the amount of the subject funding (“complementary funding”) meets or exceeds the threshold amounts established in OAR 813-005-0005(3) for review by the State Housing Council, the reservation or other commitment is subject to review and approval by the council of such subject funding and any such complementary funding. The council may approve, deny, modify or further condition funding assistance subject to its review. Based upon any relevant council determination, including with respect to complementary funding, any subject reservation or other commitment may be deemed revoked, or be modified and further conditioned.

Stat. Auth.: ORS 91.886, 317.097 & 456.555
Stats. Implemented: ORS 90.800 - 90.840, 91.886, 317.097, 456.515 – 456.725 & 458.005 - 458.740
Hist.: OHCS 14-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; OHCS 18-2013, f. & cert. ef. 12-18-13

813-005-0040

Compliance Monitoring

(1) A project receiving any department assistance is subject to such reviews and field inspections that the department determines to be necessary or appropriate including, but not limited to ensuring the funding recipient’s and project owner’s compliance with any program requirements including, but not limited to applicable administrative rules (including incorporated manuals), department directives, solicitation documents, funding documents, or otherwise. The project owner shall cooperate fully with all reviews and field inspections, comply with any resulting correction directives, and shall make all records available for inspection and copying. The project owner also shall provide such other information as the department may from time to time request.

(2) Project owners shall cooperate fully with department reviews, field inspections and other information requests including, but not limited to allowing the inspection and copying of relevant records as determined by the department.

(3) Project owners shall act promptly to correct any deficiencies identified by the department as a consequence of its reviews, field inspections or otherwise upon notice by the department of same.

(4) Project owners shall retain financial records, supporting documents and all other pertinent records with respect to a project until six years after the project affordability period for the respective source of funding is complete, or after any relevant litigation or audit claim is resolved, whichever is later.

Stat. Auth.: ORS 91.886, 317.097 & 456.555
Stats. Implemented: ORS 90.800 - 90.840, 91.886, 317.097, 456.515 – 456.725 & 458.005 - 458.740
Hist.: OHCS 14-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; OHCS 18-2013, f. & cert. ef. 12-18-13

813-005-0050

Remedies

(1) If the department determines that there has been any material failure or default with respect to any term, covenant or condition of the applicable solicitation documents or funding documents, applicable rules, directives, or other program requirements, it may exercise any remedy available under OAR chapter 813, the solicitation documents, the funding documents, other program requirements or applicable law. Remedies include, but are not limited to rescission of funding awards, issuance of corrective orders or directives, imposition of sanctions, recapture of any tax credits, recoupment of funding, recovery for damages, specific performance, injunctive relief, declaratory actions, appointment of a receiver for the project, foreclosure of lien interests, debarment from other department funding, and other remedies available at law.

(2) The remedies set forth in this section are cumulative and not exclusive and are in addition to any other rights and remedies available to the department. The department may exercise any or all remedies available to it, and in such manner as it, in its sole discretion, determines appropriate. No failure to exercise a remedy shall be deemed as a waiver or release of such remedy or other remedies or the claims upon which they are based.

(3) Any waiver of a remedy or claim must be in writing and signed by an authorized representative of the department. No waiver shall be continuing in nature or affect any other remedy or claim of the department unless expressly so stated in the signed waiver.

Stat. Auth.: ORS 91.886, 317.097 & 456.555
Stats. Implemented: ORS 90.800 - 90.840, 91.886, 317.097, 456.515 – 456.725 & 458.005 - 458.740
Hist.: OHCS 14-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; OHCS 18-2013, f. & cert. ef. 12-18-13

813-005-0060

Transfer of Recipient, Assistance or Ownership; Subordinate Liens; Encumbrances

(1) A recipient of any department assistance or owner of a project for which such assistance is provided may not transfer or allow any transfer of any interest in itself, the assistance or the project, allow a subordinate lien or otherwise encumber the project, or any portion or interest therein, unless the department first approves the transfer, subordinate lien or encumbrance in writing. Any such transfer is subject to the payment to the department of a transfer or other approval charge as required by the department. If the recipient effects or allows a transfer, subordinate lien or encumbrance without prior written approval by the department, the transfer, subordinate lien or encumbrance is voidable and remains subject to the approval or disapproval of the department and the recipient or owner responsible for allowing the transfer, subordinate lien or encumbrance and any transferees, jointly and severally, are subject to a charge by the department with respect to its review and treatment of any such event.

(2) The department may condition its approval upon such terms and conditions as it, in its sole discretion, may require. Factors the department may consider in determining whether or not to give approval to a transfer, subordinate lien or encumbrance include, but are not limited to:

(a) The financial investment of the department in the project;

(b) Preservation of existing housing;

(c) The transferee’s ability to maintain and manage the project for the needs of the residents, the integrity of the housing and as security for the assistance;

(d) The effect of the transfer, subordinate lien or encumbrance upon the financial integrity of the project, repayment of the assistance, use of the project for its intended purposes, and continuity of the program requirements; and

(e) Continued compliance with program requirements.

Stat. Auth.: ORS 91.886, 317.097 & 456.555
Stats. Implemented: ORS 90.800 - 90.840, 91.886, 317.097, 456.515 – 456.725 & 458.005 - 458.740
Hist.: OHCS 14-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; OHCS 18-2013, f. & cert. ef. 12-18-13

813-005-0070

Fees and Charges

The department may require the payment of such fees and charges as it determines appropriate with respect to the administration of its housing programs and program requirements including, but not limited to the solicitation, award, documentation and use of department funding assistance and correlation with other funding partners and resources, acquisition, development, construction, rehabilitation and operation of projects assisted with department funding assistance, ongoing compliance monitoring and enforcement of financial, affordability, and habitability requirements, transfers, subordinate liens and encumbrances.

Stat. Auth.: ORS 91.886, 317.097 & 456.555
Stats. Implemented: ORS 90.800 - 90.840, 91.886, 317.097, 456.515 – 456.725 & 458.005 - 458.740
Hist.: OHCS 14-2013(Temp), f. & cert. ef. 6-21-13 thru 12-18-13; OHCS 18-2013, f. & cert. ef. 12-18-13

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