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The Oregon Administrative Rules contain OARs filed through June 15, 2014
 
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HOUSING AND COMMUNITY SERVICES DEPARTMENT

 

DIVISION 350

GENERAL GUARANTEE PROGRAM

813-350-0005

Purpose and Objectives

OAR chapter 813, division 350 is promulgated to accomplish the general purposes of ORS 456.515 to 456.725, and more specifically, of ORS 456.625(12) and 456.625(16), which respectively authorize the Department to implement actions that the Department deems necessary or appropriate to carry out housing and community services programs, and to employ certain funds, inter alia, for loan guarantees. The General Guarantee Program as set forth in this Division establishes the process by which the Department may provide such loan guarantees to lenders, and lease guarantees to sponsors and leasing companies for the development of suitable housing for low and very-low income families and individuals including, but not limited to, disabled persons, farmworkers, and ex-offenders.

Stat. Auth.: ORS 183, ORS 456.555(2) & ORS 456.625(12)(16)
Stats. Implemented: ORS 456.625(12)(16)
Hist.: OHCS 2-2003, f. & cert. ef. 5-1-03

813-350-0010

Definitions

(1) Words and terms are used in OAR chapter 813, division 350, consistently with definitions in the Act, in 813-005-0005 and herein.

(2) As used in OAR chapter 813, division 350, unless otherwise indicated by the context:

(a) "Control" means the ownership, management, or maintenance of a housing project;

(b) "Employer(s)" also means relatives, agents, or associations of employers;

(c) "Ex-Offender" means an offender returning to the community from prison or from local control jail sentences.

(d) "Farmworker" means any person working in connection with: cultivating the soil, raising or harvesting any agricultural or aquacultural commodity; catching, netting, handling, planting, drying, grading, storing, or preserving in its unmanufactured state any agriculture or aquaculture commodity; delivering to storage, market, or a carrier for transportation to market, or to processing, any agriculture or aquaculture commodity; forestation or reforestation of land, including but not limited to, the planting, transportation, tubing, precommercial thinning of trees and seedlings, the clearing, pulling, and disposal of brush and slash, and other related activities; or as otherwise determined by the Department in the exercise of its authority;

(e) "Leasing Company" means a bank, finance company, or other person or entity, that in the ordinary course of business, acquires goods or the right to possession and use of goods and transfers the right to possession and use of such goods under a lease;

(f) "Lender" means financial institutions, including but not limited to, state and federal regulated banks, credit unions, savings and loans, savings banks, finance companies, life insurance companies, pension funds, mortgage bankers, and other public or private lending consortiums;

(g) "Low Income" means an individual or household with an adjusted annual household income that is more than 50 percent, but less than 80 percent of the area median income, as determined by the Department based on information including, but not limited to data from the United States Department of Housing and Urban Development, with allowances for family size;

(h) "Very-Low Income" means an individual or household with an adjusted annual household income that is 50 percent or less of the area median income, as determined by the Department based on information including, but not limited to data from the United States Department of Housing and Urban Development, with allowances for family size.

Stat. Auth.: ORS 183, ORS 456.555(2) & ORS 456.625(12)(16)
Stats. Implemented: ORS 456.515 - ORS 456.725
Hist.: OHCS 2-2003, f. & cert. ef. 5-1-03

813-350-0020

Source of Guarantee Funding

The Department may provide loan and lease guarantees under this Division from:

(1) Unrestricted cash and investments of the Department made available for use as loan and lease guarantees, not needed for operations of the Department and not otherwise determined by the Director to be a necessary or prudent reserve;

(2) Resources made available to the Department for loan and lease guarantees from other financial institutions, including but not limited to, Federal Home Loan Bank and Fannie Mae; and,

(3) Appropriations for this purpose.

Stat. Auth.: ORS 183, ORS 456.555(2) & ORS 456.625(12)(16)
Stats. Implemented: ORS 456.515 - ORS 456.725
Hist.: OHCS 2-2003, f. & cert. ef. 5-1-03

813-350-0030

Eligibility for Guarantees

(1) The Department may provide guarantees for the partial repayment of loans made by lenders to finance the construction, development, acquisition, and/or rehabilitation of, and/or for the partial repayment of leases made by sponsors or leasing companies to facilitate the equipping, development or operation of:

(a) Suitable housing for low and/or very-low income persons and households including, but not limited to, suitable housing for disabled persons, farmworkers, and suitable transitional housing for ex-offenders;

(b) The commercial component of a structure that contains both commercial property and suitable housing for low and/or very-low income individuals and households; or

(c) Both (a) and (b).

(2) The Department may not:

(a) Issue any loan guarantee under this Division that guarantees the repayment of more than 25 percent of any qualifying loan obligation;

(b) Issue any loan or lease guarantee under this Division equal to or in excess of $100,000 without obtaining the prior approval of the Housing Council;

(c) Issue any single loan or lease guarantee under this Division in excess of $1,000,000;

(d) Issue loan and lease guarantees under this Division in an aggregate outstanding amount in excess of $4,000,000; and

(3) The Department may choose at any time not to maximize its loan and/or lease guarantee authority under this Division.

Stat. Auth.: ORS 183, ORS 456.555(2) & 456.625(12)(16)
Stats. Implemented: ORS 456.515 - 456.725
Hist.: OHCS 2-2003, f. & cert. ef. 5-1-03; OHCS 8-2003(Temp), f. & cert. ef. 10-13-03 thru 4-9-04; OHCS 1-2004, f. & cert. ef. 4-8-04

813-350-0040

Application Procedure and Requirements

(1) To obtain a loan or lease guarantee under this Division, a lender, sponsor or leasing company must submit a request for a loan or lease guarantee to the Department, in form and content satisfactory to the Department.

(2) The request must include the following documents and information, all in form and content satisfactory to the Department:

(a) A written description of the project needing credit enhancement including, but not limited to, the number of units, unit mix, proposed rents, site location and amenities;

(b) A statement of the project purpose indicating the housing type and residents to be housed;

(c) A proforma of project expenses and income;

(d) The loan and/or lease guarantee amount requested;

(e) A statement of total project development costs, including a description of all additional project funding and credit enhancement sources;

(f) A description of the sponsor/developer/owner/manager experience in developing and operating housing projects; and

(g) Such other documents and information as the Department may require.

(3) The Department may identify periods of time when it will accept or not accept loan and/or lease guarantee applications.

(4) The Department may solicit requests for loan and/or lease applications.

Stat. Auth.: ORS 183, ORS 456.555(2) & ORS 456.625(12)(16)
Stats. Implemented: ORS 456.515 - ORS 456.725
Hist.: OHCS 2-2003, f. & cert. ef. 5-1-03

813-350-0050

Criteria for Guarantees

(1) The Department has no obligation to issue any loan and/or lease guarantee in response to any loan and/or lease guarantee request made pursuant to this Division.

(2) In evaluating whether or not to provide a loan and/or lease guarantee, or the amount of any such guarantee, the Department may consider factors including, but not limited to the following:

(a) The responsiveness and accuracy of the request;

(b) The need of the project for the guarantee;

(c) The availability of other credit enhancement vehicles;

(d) The credit worthiness of the project;

(e) The experience and ability of the project sponsor;

(f) The experience and ability of the lender and/or leasing company;

(g) The location and need for the project;

(h) The availability of Department funds and guarantee authority;

(i) The Department's experience with and/or the reputation of the lender, leasing company and/or sponsor, including without limitation, any of their agents, representatives, employees or contractors;

(j) The amount, quality, and duration of suitable lower income housing to be provided or enabled by the project;

(k) The mix of low and very-low income housing to be provided or enabled; and

(l) Any other information obtained by or made available to the Department.

(3) The Department may give a preference for a loan and/or lease guarantee based upon factors including, but not limited those described in subparagraph (2) and to the following:

(a) Providing the greatest number of suitable housing units constructed, acquired, developed or rehabilitated for the least amount of guarantee, granted or committed;

(b) The longest possible use for the units as lower income housing units;

(c) Providing suitable housing for a seasonal work force, where a critical need for housing such a work force exists; and

(d) Providing suitable housing for specific populations, which have historically faced barriers in finding housing, and which are identified as having a priority in the Consolidated Plan or its successor or in a state-acknowledged initiative;

(4) In evaluating housing projects that serve a predominantly non-English speaking population, the Department may give subordinate preference to projects which mitigate the language barrier impact in the provision of supportive services.

Stat. Auth.: ORS 183, ORS 456.555(2) & ORS 456.625(12)(16)
Stats. Implemented: ORS 456.515 - ORS 456.725
Hist.: OHCS 2-2003, f. & cert. ef. 5-1-03

813-350-0060

Fees

(1) A nonrefundable fee of $250.00 must be submitted with each request for a loan and/or lease guarantee.

(2) A lender, sponsor or leasing company receiving a loan or lease guarantee will be charged, and must pay, an annual fee of one percent of the guaranteed amount. Payment shall be remitted to the Department not less than annually as designated by the Department. All fees are nonrefundable.

(3) Line of credit guarantee fees will be based by the Department, and charged, on the total credit line.

(4) The Department may charge other fees, as determined necessary or appropriate by the Department to cover actual and anticipated costs of a guarantee including, without limitation, its issuance and its evaluation, or to reduce the financial risk to the Department of making a guarantee.

Stat. Auth.: ORS 183, ORS 456.555(2) & ORS 456.625(12)(16)
Stats. Implemented: ORS 456.515 - ORS 456.725
Hist.: OHCS 2-2003, f. & cert. ef. 5-1-03

813-350-0070

Waiver

The Director may waive or modify any requirement of OAR 813, Division 350, unless such waiver or modification would violate applicable state or federal statutes or regulations.

Stat. Auth.: ORS 183, ORS 456.555(2) & ORS 456.625(12)(16)
Stats. Implemented: ORS 456.515 - ORS 456.725
Hist.: OHCS 2-2003, f. & cert. ef. 5-1-03

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