CA Health & Safety Code § 50720.2 (2021)
2021 California Code|Health and Safety Code - HSC|DIVISION 31 - HOUSING AND HOME FINANCE|PART 2 - DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT|CHAPTER 8.6 - Foreclosure Intervention Housing Preservation Program|Section 50720.2.

50720.2.  (a) The Foreclosure Intervention Housing Preservation Program is hereby established. The department shall administer the program for the purpose of preserving affordable housing and promoting resident ownership or nonprofit organization ownership of residential real property.(b) (1) Upon appropriation by the Legislature, the program shall be administered by the department to provide loans to eligible borrowers to support the acquisition of 1 to 25 unit properties meeting any of the following criteria:(A) Real property subject to a trustee’s sale pursuant to Section 2924m of the Civil Code wherein an eligible bidder has made a bid or represents an intention to bid using funds from the program.(B) Real property subject to a preforeclosure intervention sale.(C) Real property subject to a foreclosure risk intervention sale.(D) Real property subject to a recorded notice of default.(2) Eligible borrowers shall be any one of the following:(A) Eligible bidders in Section 2924m of the Civil Code other than “prospective owner-occupants” as defined in paragraph (1) of subdivision (a) of Section 2924m of the Civil Code.(B) An organization whose primary activity is the development and preservation of affordable housing that is at least one of the following:(i) An incorporated nonprofit organization as described in Section 501(c)(3) of the Internal Revenue Code (26 U.S.C. Sec. 501(c)(3)) that is exempt from taxation under Section 501(a) of that code (26 U.S.C. Sec. 501(a)).(ii) A nonprofit corporation as that term is defined in Section 50091 of the Health and Safety Code.(C) A limited liability company that satisfies both of the following criteria:(i) A community land trust, as defined in clause (ii) of subparagraph (C) of paragraph (11) of subdivision (a) of Section 402.1 of the Revenue and Taxation Code, holds a controlling interest in the company.(ii) A community land trust, as defined in clause (ii) of subparagraph (C) of paragraph (11) of subdivision (a) of Section 402.1 of the Revenue and Taxation Code, is the managing member of the company.(3) Up to 5 percent of the funds appropriated for this program may be expended for the costs to administer the program. Costs to administer the program include, but are not limited to, all of the following:(A) Costs to develop the guidelines required by this chapter, which may include, but is not limited to, the following:(i) Department staffing expenses incurred in developing the guidelines.(ii) Contracting with one or more program fund managers to develop the guidelines.(iii) Contracting with third-party consultants to develop guidelines.(B) Costs to develop lending criteria.(C) Costs to advertise the program.(D) Costs to develop technical assistance tools to support qualified entities in navigating the requirements and processes to apply for funding including, but not limited to, the following:(i) Training modules.(ii) Acquisition-rehabilitation specific financing templates and guidance, such as pro formas and worksheets.(iii) Best practice guides for engaging tenants before and after property acquisition, managing safe and accessible rehabilitation of occupied buildings, facilitating resident ownership, and any other topic deemed appropriate by the department.(iv) Technical assistance with resident engagement and education, property assessment and due diligence, affordable housing operations management, acquisition-rehabilitation project financial assistance, construction, and property management.(4) Funds not committed to fund managers pursuant to Section 50720.6 as of December 31, 2025, or any funds returned from fund managers after December 31, 2025, shall be made available for loans authorized by Chapter 5.5 (commencing with Section 50606). Notwithstanding the requirements of Chapter 5.5, uncommitted or returned funds made available for purposes of Chapter 5.5 may be used to assist projects funded by the department or other public entities.(5) Not later than May 15, 2023, the department shall report to the chairs of the Assembly Committee on Budget and the Senate Committee on Budget and Fiscal Review on the implementation of this program, including amount of funding disbursed and number, location, and cost of acquired properties, as well as the number of units acquired.(c) All repayments of program funds, including loan principal and any interest collected, and any interest earned on the funds shall be deposited into the Housing Rehabilitation Loan Fund for purposes of the program, including, but not limited to, loans and grants to pay for repairs, maintenance, or improvements on properties acquired pursuant to the program. The funds may also be used to provide technical assistance pursuant to this chapter.(Added by Stats. 2021, Ch. 111, Sec. 23. (AB 140) Effective July 19, 2021.)