Florida Administrative Code › 67 - FLORIDA HOUSING FINANCE CORPORATION › 67 - Departmental › Chapter 67-48 - COMPETITIVE AFFORDABLE MULTIFAMILY RENTAL HOUSING PROGRAMS SAIL/HOME/HC › Part IV - HOUSING CREDIT PROGRAM › Section 67-48.031 - Qualified Contracts

Current through Reg. 50, No. 138; July 16, 2024
(1) An owner's
				  written request to the Corporation for a qualified contract (a "qualified
				  contract request") shall be governed by
				  26 CFR
				  1.42-18 (the "qualified contract
				  regulations"), Section 42 of the IRC, as applicable,
				  Section 420.503(4),
				  F.S., and Section 420.503(36),
				  F.S., and this rule section in effect at the time of the qualified contract
				  request. As used in this rule section:
"Bona fide contract" has the same meaning as in Section
					 420.503(4),
					 F.S.
"Qualified contract" has the same meaning as in Section
					 420.503(36),
					 F.S.
(2) For purposes of
				  this rule and processing a qualified contract request, the Corporation shall be
				  deemed to have fulfilled its responsibility to present the owner with a
				  qualified contract by presenting the owner with a contract deemed by the
				  Corporation to be a qualified contract pursuant to Section
				  420.503(36),
				  F.S., within the one-year period described in Section
				  42(h)(6)(I) of
				  the IRC. The initial deposit required by Section
				  420.503(36),
				  F.S., to be deposited in escrow in order for the bona fide contract to be
				  deemed a qualified contract must be deposited in escrow with a nationally
				  recognized title insurance company which offers escrow services ("escrow
				  agent") designated by the owner at the time of submission of the qualified
				  contract request, or if no such escrow agent is designated by the owner, with
				  an escrow agent selected by the purchaser, contemporaneously with the
				  submission of the contract to the owner. The contract shall be accompanied by
				  written notice from the Corporation to the owner that the contract has been
				  deemed by the Corporation to be a qualified contract pursuant to Section
				  420.503(36),
				  F.S. It shall be the owner's responsibility to negotiate with the purchaser the
				  specific terms of the contract, and the owner's rejection of the contract or
				  failure to act on the contract shall in no way affect the status of the
				  contract as a qualified contract. The Corporation shall have no duty and is not
				  responsible to either the owner or the purchaser for negotiating the details of
				  the qualified contract following its presentation to the owner.
(3) After the 14th year of the Compliance
				  Period, unless otherwise obligated under the Extended Use Agreement, or a Land
				  Use Restriction Agreement under another Corporation program, and provided the
				  right to request a qualified contract for the Development was not waived in
				  exchange for or in connection with the award of Housing Credits, the owner of a
				  Development may submit a qualified contract request to the Corporation. When
				  submitting a qualified contract request, the owner shall utilize the Qualified
				  Contract Package in effect at the time of the request and shall remit payment
				  of the required Qualified Contract Package fee as provided therein. The
				  Qualified Contract Package consists of the forms and instructions, obtained
				  from the Corporation at 227 North Bronough Street, Suite 5000, Tallahassee,
				  Florida 32301-1329, or on the Corporation's website under the Multifamily
				  Programs link or from
http://www.flrules.org/Gateway/reference.asp?No=Ref-12013
,
				  which shall be completed and submitted to the Corporation in order to request a
				  qualified contract. The Qualified Contract Package, Rev. 03-2020, is adopted
				  and incorporated herein by reference.
(4) All information contained in a Qualified
				  Contract Package is subject to independent review, analysis and verification by
				  the Corporation or its agents. The Corporation may request additional
				  information to document the qualified contract amount calculated by the owner.
				  The Corporation may also engage the services of its own certified public
				  accountant (CPA) and real estate appraiser to assist in the review of a
				  Qualified Contract Package. Real estate appraisers involved in the qualified
				  contract process must be licensed by the state of Florida, be an MAI-designated
				  general appraiser and be otherwise acceptable to the Corporation.
(5) The qualified contract regulations
				  provide that the fair market value of the non-low-income portion of the
				  building includes the fair market value of the underlying land and that the
				  valuation of the underlying land must take into account the existing and
				  continuing requirements contained in the Extended Use Agreement. Pursuant to
				  Section 193.017, F.S., and the statutes
				  cited therein, the Extended Use Agreement recorded in connection with a Housing
				  Credit property is a land-use regulation and a limitation on the highest and
				  best use of the property during the term of the agreement that must be
				  considered by the county property appraiser in assessing the value of the
				  property. Unless the owner elects otherwise as provided below, for purposes of
				  a qualified contract request, the fair market value of the underlying land
				  shall be the value attributed to the underlying land by the county property
				  appraiser in the most recent year's assessed value of the Development provided
				  that the county property appraiser's valuation of the land takes into account
				  the existing and continuing requirements contained in the Extended Use
				  Agreement. The county property appraiser's valuation methodology shall be
				  verified upon submission of a qualified contract request in order to determine
				  if the valuation of the land has taken into account the existing and continuing
				  requirements contained in the Extended Use Agreement. If the owner is of the
				  opinion that the county property appraiser's valuation does not represent the
				  fair market value of the underlying land within the contemplation of the
				  qualified contract regulations at the time of the qualified contract request,
				  the owner may elect to submit with its qualified contract request a value (the
				  "owner's appraised value") for the underlying land at the fair market value
				  determined by a real estate appraiser (the "owner's appraiser") engaged by the
				  owner for that purpose in lieu of the county property appraiser's valuation. A
				  copy of the real estate appraisal (the "owner's appraisal report") upon which
				  the owner's appraised value is based shall be included with the owner's
				  qualified contract request. If the owner elects to rely on the county property
				  appraiser's valuation of the land and the Corporation determines that the
				  county property appraiser's valuation did not take into account the existing
				  and continuing requirements contained in the Extended Use Agreement, the county
				  property appraiser's valuation shall be disregarded, and instead, the owner
				  must obtain and submit to the Corporation an owner's appraisal report together
				  with the owner's appraised value as provided above. The owner's appraiser must
				  certify in the appraisal report that the valuation represents the fair market
				  value of the underlying land taking into account the existing and continuing
				  requirements contained in the Extended Use Agreement for the property. The
				  owner's appraisal report must also include a narrative describing the
				  methodology or manner in which the requirements contained in the Extended Use
				  Agreement were considered by the owner's appraiser in arriving at the owner's
				  appraised value of the underlying land, and, for comparison and evaluation
				  purposes, the opinion of the owner's appraiser as to what the fair market value
				  of the underlying land would be if unencumbered by the requirements of the
				  Extended Use Agreement. The lower of the restricted and unrestricted appraised
				  values should be included in the qualified contract price if the owner's
				  appraised value is submitted. The owner's appraised value of the underlying
				  land and the owner's appraisal report shall be subject to review and approval
				  by the Corporation. The Corporation may engage the services of one or more real
				  estate appraisers, or other professionals, to assist in the review and
				  evaluation of the owner's appraised value and the owner's appraisal
				  report.
(6) In addition to the
				  Qualified Contract Package fee, the owner shall be responsible for all
				  third-party fees in connection with the owner's qualified contract request.
				  Third party fees include, but are not limited to, the costs of the services
				  provided by CPAs and real estate appraisers or other real estate professionals
				  engaged by the Corporation to assist it in the review of a qualified contract
				  request, and the fees and commissions of any real estate broker in connection
				  with the marketing and sale of the development to a buyer under a qualified
				  contract.
(7) When offering a
				  development for sale to the general public pursuant to a qualified contract
				  request, the Corporation may, but shall not be required to, utilize the
				  services of a real estate broker under contract with or designated by the
				  Corporation to market and sell the development. The owner of the development
				  shall be responsible for the fees and commissions due any such real estate
				  broker in connection with the marketing and sale of the development, and, upon
				  request of the Corporation or the real estate broker, the owner shall enter
				  into a written agreement with the real estate broker pursuant to which the
				  owner agrees to pay to the real estate broker such fees and commissions in
				  connection with the marketing and sale of the development.
(8) The running of the one-year period
				  described in Section 42(h)(6)(I) of
				  the IRC shall be suspended by the Corporation at any time upon written notice
				  to the owner if:
(a) The Corporation
				  concludes that the owner's request lacks information required in the Qualified
				  Contract Package or other essential information;
(b) The owner fails to pay the Qualified
				  Contract Package fee or, thereafter, fails to timely pay any other fees or
				  costs for which the owner is responsible hereunder;
(c) The owner and the Corporation are unable
				  to reach mutual agreement on the qualified contract amount;
(d) The Development that is the subject of
				  the qualified contract request is not in compliance with the applicable program
				  requirements or if any fees related to the Development are
				  delinquent;
(e) The owner fails to
				  allow the Corporation, its agents or prospective buyers timely access to the
				  Development for purposes of verification, inspection or due
				  diligence;
(f) The Applicant or
				  Developer, or Principal, Affiliate or Financial Beneficiary of an Applicant or
				  a Developer is in arrears to the Corporation or any agent or assignee of the
				  Corporation;
(g) Following request,
				  the owner fails to enter into the written agreement with the real estate broker
				  designated by the Corporation to market and sell the development;
(h) Administrative or civil proceedings are
				  commenced at any time during the one-year period contesting a determination or
				  decision made by the Corporation regarding a qualified contract request or a
				  qualified contract; or
(i) The
				  owner otherwise fails to comply with the requirements of this rule section or
				  the qualified contract regulations.
The term of any such suspension shall begin on the date of
					 the written notice provided by the Corporation to the owner, and shall continue
					 unabated until such date as the deficiency, non-payment, litigation or
					 disagreement giving rise to the suspension is cured or otherwise resolved. The
					 Corporation shall acknowledge the cure or resolution by written notice to the
					 owner within 10 days thereafter. The owner's election to value the underlying
					 land based on the owner's appraised value as provided in subsection (6), above,
					 shall automatically prevent the owner's purported qualified contract request
					 from beginning the one-year period described in Section
					 42(h)(6)(I) of
					 the IRC until such time as the Corporation and the owner shall mutually agree
					 on the value of the underlying land for purposes of the owner's qualified
					 contract request.
References in this rule to the one-year period shall mean
					 the running of the one-year period as same may be affected as a result of being
					 suspended pursuant to this subsection (8).