12 U.S.C. § 4106 — Information from Secretary

Page 1598 TITLE 12—BANKS AND BANKING § 4106 paragraph (1), the Secretary shall determine whether such aggregate rents exceed the amount determined by multiplying 120 percent of the prevailing rents in the relevant local market area in which the housing is located by the number of units in the project (accord- ing to the appropriate unit sizes). A relevant local market area shall be an area geographi- cally smaller than a market area established by the Secretary under section 1437f(c)(1) of title 42 that is identifiable as a distinct rental market area. The Secretary may rely on the appraisal to determine the relevant local mar- ket areas and prevailing rents in such local areas and any other information the Secretary determines is appropriate. (3) Effect For purposes of this subchapter, the aggre- gate preservation rents shall be considered to exceed the Federal cost limits under this sub- section only if the aggregate preservation rents exceed the amount determined under paragraph (1) and the amount determined under paragraph (2). (b) Limitations on action pursuant to Federal cost limits (1) Housing within Federal cost limits If the aggregate preservation rents for an el- igible low-income housing project do not ex- ceed the Federal cost limit, the owner may not prepay the mortgage on the housing or terminate the insurance contract with respect to the housing, except as permitted under sec- tion 4114 of this title. The owner may— (A) file a plan of action under section 4107 of this title to receive incentives under sec- tion 4109 of this title; or (B) file a second notice of intent under sec- tion 4106(d) of this title indicating an inten- tion to transfer the housing under section 4110 of this title and take actions pursuant to such section. (2) Housing exceeding Federal cost limits If the aggregate preservation rents for an el- igible low-income housing project exceed the Federal cost limit, the owner may— (A) file a plan of action under section 4107 of this title to receive incentives under sec- tion 4109 of this title if the owner agrees to accept incentives under such sections in an amount that shall not exceed the Federal cost limit; (B) file a second notice of intent under sec- tion 4106(d) of this title indicating an inten- tion to transfer the housing under section 4110 of this title and take actions pursuant to such section if the owner agrees to trans- fer the housing at a price that shall not ex- ceed the Federal cost limit; or (C) file a second notice of intent under sec- tion 4106(d) of this title indicating an inten- tion to prepay the mortgage or voluntarily terminate the insurance, subject to the man- datory sale provisions under section 4111 of this title. (Pub. L. 100–242, title II, § 215, as added Pub. L. 101–625, title VI, § 601(a), Nov. 28, 1990, 104 Stat. 4252; amended Pub. L. 102–550, title III, § 317(a)(1), Oct. 28, 1992, 106 Stat. 3772.) Editorial Notes AMENDMENTS 1992—Subsec. (a)(2). Pub. L. 102–550 made technical amendment to reference to section 1437f(c)(1) of title 42 to reflect correction of corresponding provision of original act. § 4106. Information from Secretary (a) Information to owners terminating afford- ability restrictions The Secretary shall provide each owner who submits a notice of intent to terminate the low- income affordability restrictions on the housing under section 4108 of this title with information under this section not later than 6 months after receipt of the notice of intent. The information shall include a description of the criteria for such termination specified under section 4108 of this title and the documentation required to satisfy such criteria. (b) Information to owners extending low-income affordability restrictions The Secretary shall provide each owner who submits notice of intent to extend the low-in- come affordability restrictions on the housing under section 4109 of this title or transfer the housing under section 4110 of this title to a qualified purchaser with information under this subsection not later than 9 months after receipt of the notice of intent. The information shall in- clude any information necessary for the owner to prepare a plan of action under section 4107 of this title, including the following: (1) Preservation values A statement of the preservation value of the housing determined under paragraphs (1) and (2) of section 4103(b) of this title. (2) Preservation rent A statement of the preservation rent for the housing as calculated under section 4104(b) of this title. (3) Federal cost limits A statement of the applicable Federal cost limits for the market area (or relevant local market area, if applicable) in which the hous- ing is located, which shall explain the limita- tions under sections 4109 and 4110 of this title of the amount of assistance that the Secretary may provide based on such cost limits. (4) Federal cost limit analysis A statement of whether the aggregate pres- ervation rents exceed the Federal cost limits and a direction to the owner to file a plan of action under section 4107 of this title or sub- mit a second notice of intent under subsection (d), whichever is applicable. (c) Availability to tenants The Secretary shall make any information provided to the owner under subsections (a) and (b) available to the tenants of the housing, to- gether with other information relating to the rights and opportunities of the tenants. (d) Second notice of intent (1) Filing Each owner of eligible low-income housing that elects to transfer housing under section Page 1599 TITLE 12—BANKS AND BANKING § 4107 1 See References in Text note below. 4110 of this title shall submit to the Secretary, in such form and manner as the Secretary pre- scribes, notice of intent to sell the housing under section 4110 of this title. To be eligible to prepay the mortgage or voluntarily termi- nate the insurance contract on the mortgage, an owner of housing for which the preserva- tion rents exceed the Federal cost limits under section 4105(b) of this title shall submit to the Secretary notice of such intent. The provi- sions of sections 4111 and 4113 of this title shall apply to any owner submitting a notice under the preceding sentence. (2) Timing A second notice of intent under this sub- section shall be submitted not later than 30 days after receipt of information from the Sec- retary under this section. If an owner fails to submit such notice within such period, the no- tice of intent submitted by the owner under section 4102 of this title shall be void and inef- fective for purposes of this subchapter. (3) Filing with the State or local government, tenants, and mortgagee Upon filing a second notice of intent under this subsection, the owner shall simulta- neously file such notice of the intent with the chief executive officer of the appropriate State or local government for the jurisdiction with- in which the housing is located and with the mortgagee, and shall inform the tenants of the housing of the filing. (Pub. L. 100–242, title II, § 216, as added Pub. L. 101–625, title VI, § 601(a), Nov. 28, 1990, 104 Stat. 4253; amended Pub. L. 102–550, title III, §§ 303, 317(a)(2), Oct. 28, 1992, 106 Stat. 3763, 3772.) Editorial Notes AMENDMENTS 1992—Subsec. (b)(4). Pub. L. 102–550, § 317(a)(2), sub- stituted ‘‘exceed’’ for ‘‘exceeds’’. Subsec. (d)(3). Pub. L. 102–550, § 303, added par. (3). § 4107. Plan of action (a) Submission to Secretary (1) Timing Not later than 6 months after receipt of the information from the Secretary under section 4106 of this title an owner seeking to termi- nate the low-income affordability restrictions through prepayment of the mortgage or vol- untary termination under section 4108 of this title, or to extend the low-income afford- ability restriction on the housing under sec- tion 4109 of this title, shall submit a plan of action to the Secretary in such form and man- ner as the Secretary shall prescribe. Any owner or purchaser seeking a transfer of the housing under section 4110 or 4111 of this title shall submit a plan of action under this sec- tion to the Secretary upon acceptance of a bona fide offer under section 4110(b) or (c) of this title or upon making of any bona fide offer under section 4111 of this title. (2) Copies to tenants Each owner submitting a plan of action under this section to the Secretary shall also submit a copy to the tenants of the housing. The owner shall simultaneously submit the plan of action to the office of the chief execu- tive officer of the appropriate State or local government for the jurisdiction within which the housing is located. Each owner and the Secretary shall also, upon request, make available to the tenants of the housing and to the office of the chief executive officer of the appropriate State or local government for the jurisdiction within which the housing is lo- cated all documentation supporting the plan of action, but not including any information that the Secretary determines is proprietary information. An appropriate agency of such State or local government shall review the plan and advise the tenants of the housing of any programs that are available to assist the tenants in carrying out the purposes of this title.1 (3) Failure to submit If the owner does not submit a plan of action to the Secretary within the 6-month period re- ferred to in paragraph (1) (or the applicable longer period), the notice of intent shall be in- effective for purposes of this subchapter and the owner may not submit another notice of intent under section 4102 of this title until 6 months after the expiration of such period. (b) Contents (1) Termination of affordability restrictions If the plan of action proposes to terminate the low-income affordability restrictions through prepayment or voluntary termination in accordance with section 4108 of this title, the plan shall include— (A) a description of any proposed changes in the status or terms of the mortgage or regulatory agreement; (B) a description of any proposed changes in the low-income affordability restrictions; (C) a description of any change in owner- ship that is related to prepayment or vol- untary termination; (D) an assessment of the effect of the pro- posed changes on existing tenants; (E) an analysis of the effect of the pro- posed changes on the supply of housing af- fordable to low- and very low-income fami- lies or persons in the community within which the housing is located and in the area that the housing could reasonably be ex- pected to serve; and (F) any other information that the Sec- retary determines is necessary to achieve the purposes of this title.1 (2) Extension of affordability restrictions If the plan of action proposes to extend the low-income affordability restrictions of the housing in accordance with section 4109 of this title or transfer the housing to a qualified pur- chaser in accordance with section 4110 of this title, the plan shall include— (A) a description of any proposed changes in the status or terms of the mortgage or regulatory agreement; (B) a description of the Federal incentives requested (including cash flow projections),