Financial incentives also will be offered to nonprofit organizations buying projects from owners wanting out of the Sec. 8 program, Peppercorn tells a press conference. The Senate Appropriations Committee instructs the agency to complete 100 full restructuring deals by June 29, 2001. The capital recovery payments in the package of incentives will provide owners a reasonable rate of return on their portion of required project rehabilitation and transition expenditures. Payments will be set at 350 basis points above corresponding Treasury Dept. securities. Owners will receive them monthly for 7-10 years as operating expenses.
Unpaid amounts can accrue.
Unpaid amounts will not accrue. To be eligible for incentives, owners must score 60 or higher on HUD's Real Estate Assessment Center inspections and have no outstanding management problems cited by REAC and other federal audits. Owners will be allowed to finance all of their initial replacement reserves. Nonprofits buying Sec. Nonprofit buyers must agree to reinvest any extra cash flow into their projects.