Bill Text: CA AB515 | 2023-2024 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Housing programs: financing.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Engrossed - Dead) 2023-09-01 - In committee: Held under submission. [AB515 Detail]

Download: California-2023-AB515-Amended.html

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Amended  IN  Assembly  April 24, 2023

Amended  IN  Assembly  March 16, 2023

CALIFORNIA LEGISLATURE— 2023–2024 REGULAR SESSION

Assembly Bill

No. 515

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Introduced by Assembly Member Ward

February 07, 2023

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An act to add Section 50406.4 to the Health and Safety Code, relating to housing.

LEGISLATIVE COUNSEL'S DIGEST

AB 515, as amended, Ward. Housing programs: loans: prepayment.

Existing law establishes the Department of Housing and Community Development and requires it to administer various programs intended to promote the development of housing and to provide housing assistance and home loans, including the Multifamily Housing Program, pursuant to which the department provides assistance in the form of deferred payment loans to pay for the eligible costs of development of specified types of housing. Existing law sets forth various general powers of the department in implementing these programs, including authorizing the department to enter into long-term contracts or agreements of up to 30 years for the purpose of servicing loans or grants or enforcing regulatory agreements or other security documents.

This bill would require the department to allow prepayment of any loans related to housing or housing projects administered by the department an owner of a property subject to a regulatory agreement with the department to take out additional debt on the development to finance rehabilitation of the property or investment in new affordable housing, if specified conditions are met, including that refinancing all hard debt is underwritten with a debt-service coverage ratio of 1.15 and demonstrates positive cash flow for 15 consecutive years.

Digest Key

Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

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Bill Text

The people of the State of California do enact as follows:

SECTION 1.

 Section 50406.4 is added to the Health and Safety Code, to read:

50406.4.

 Notwithstanding any other law, and to the extent permitted under federal law and the California Constitution, the department shall allow prepayment of any loans related to housing or housing projects administered by the department an owner of a property subject to a regulatory agreement with the department to take out additional debt on the development to finance, with the department’s approval, rehabilitation of the property or investment in new affordable housing, if all of the following conditions are met:

(a) Refinancing All hard debt, including the additional debt, is underwritten with a debt-service coverage ratio of 1.15 and demonstrates positive cash flow for 15 consecutive years.

(b) Any new debt is subordinate to the department’s lien, lien and regulatory agreement, as applicable.

(c) Any equity is contributed, with the department’s approval, to other projects that will increase or improve the supply of deed-restricted affordable housing serving low-income households in the state.

(c)

(d) The department’s regulatory agreement remains in place for the project for its remaining term.

(d)

(e) The department continues to receive monitoring fees to ensure compliance with the existing regulatory agreement.