California Code of Regulations › Title 25 - Housing and Community Development › Division 1 - Housing and Community Development › Chapter 7 - Department of Housing and Community Development Programs › Subchapter 5 - Deferred-Payment Rehabilitation Loans › Section 7416 - Tenancy Standards and Procedures

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The following terms and conditions govern tenant selection,
					 relations, and evictions for low-income tenants of rental units rehabilitated
					 with loans from the Fund.
(a) Initial
				  priority for rental units shall be given to those households which resided on
				  the premises prior to rehabilitation and were displaced due to, or during the
				  process of, rehabilitation.
(b)
				  Borrowers shall agree to rent 100 percent of the residential units in a housing
				  development rehabilitated with loans from the Fund, other than owner-occupied
				  residences or units, to low income households during the term of the loan,
				  except where it is necessary to preserve the economic feasibility of the
				  development or avoid displacement. In such cases, the Department may approve a
				  lower percentage, however, in no case shall less than 50 percent of the units
				  be designated for low income households. If the designated number of low income
				  units are initially occupied by non-low income households but subsequently
				  become vacant, the borrower shall agree to rent such units to low income
				  households. The borrower shall affirmatively seek such households by contacting
				  the local housing authority. Where the borrower cannot obtain such low income
				  tenants by contacting the local housing authority, the borrower shall contact
				  the local entity for guidance. The local entity shall contact the Department if
				  its efforts do not result in low income tenants for the vacant units.
(c) If rental subsidies are available,
				  borrowers may accept rent subsidies for assisted units.
(d) Rents shall remain at pre-loan
				  application levels until rehabilitation is completed. After rehabilitation,
				  increases in rents shall be limited to avoid displacement of low and moderate
				  income households pursuant to Government Code Section 7265.3(b). Proposed
				  after-rehabilitation rents shall be established by the local entity and
				  borrower prior to approval of the loan agreement by the Department. Rents shall
				  be set at levels in accordance with the provisions set forth in Section 7412(c)
				  and consistent with the economic feasibility of the housing development and a
				  fair rate of return to the owner of the housing development as determined by
				  the Department.
(e) The borrower
				  shall agree to use a lease prepared by the Department which conforms to
				  California law and the requirements of Sections 11402 and 11405-11406 or other
				  lease subject to the approval of the Department.
(f) The borrower and tenants shall comply
				  promptly and fairly with their responsibilities under law and as set forth in
				  the lease. In addition, the borrower shall make every effort feasible to ensure
				  the stability and security of tenants.
(g) If a tenant's income exceeds the standard
				  pursuant to which he or she was accepted for tenancy, that fact alone shall
				  neither cause the tenant's eviction nor be a violation of the borrower's loan
				  agreement or these regulations.
1. Amendment
					 filed 10-2-81; effective thirtieth day thereafter (Register 81, No.
					 40).
2. Amendment of subsection (b) filed 11-2-82; effective
					 thirtieth day thereafter (Register 82, No. 45).
Note: Authority cited: Section 50662, Health and Safety
						Code. Reference: Sections 50660-50668, Health and Safety
						Code.