Code of Massachusetts Regulations › 760 CMR - HOUSING AND LIVABLE COMMUNITIES, EXECUTIVE OFFICE OF › Title 760 CMR 4.00 - General Administration Of Local Housing Authorities › Section 4.11 - Development of Additional Units on Land Subject to a Contract for Financial Assistance by LHAs or Controlled Affiliates

Current through Register 1525, July 5, 2024
(1) Pursuant to
			 M.G.L. c. 121B, § 31 an LHA or a controlled affiliate may submit to the
			 Department an application for a new affordable housing development utilizing private
			 or mixed public and private financing on land which is or has been subject to a
			 contract for financial assistance for or in connection with a state-aided housing
			 project between the LHA and the Department. The form and contents of such an
			 application shall be prescribed by the Department and shall include the plans and
			 description of the new affordable housing development, the estimated cost thereof,
			 the proposed method of financing, and a detailed estimate of the expenses and
			 revenue thereof. Within 60 days of receipt of a complete application the Department
			 shall approve such application provided that it shall have made the following
			 findings:
(a) The land is surplus to the needs of
			 any existing state-aided housing project and to any planned state-aided housing
			 project on the site.
(b) Excepting any
			 market-rate housing, the housing to be constructed will be deed restricted to
			 occupancy by low or moderate income households at affordable rents or sales prices.
			 Any deed restriction shall specify the term for which the housing shall be
			 affordable. The term may be perpetual or for a lesser number of years provided that
			 the term shall be a minimum of 40 years or such other term as may be approved by the
			 Department in a waiver of the 40-year minimum term. The purpose of the deed
			 restriction shall be to ensure affordability of the housing during the
			 term.
(c) Adequate provision has been
			 made so that the tenant share of the rent for an affordable rental housing unit will
			 be no more than the greater of the following amounts:
1. no more than the percentage of monthly net
			 household income which is specified in
			 760 CMR 6.04(1)(b)
			  with net household income of the tenant household
			 determined in the manner specified in
			 760 CMR
			 6.05:
Determination of Gross Household
			 Income and Net Household Income
; or
2. an amount not to exceed 30% of 75% of area
			 median household income adjusted for household size as determined by HUD except as
			 the Department may otherwise approve; or
3. the amount allowed as the tenant share of rent
			 by a state or federal affordable housing program which has provided financing for or
			 has otherwise subsidized the housing unit.
(d) Alternatively, adequate provision has been
			 made so that the sales price of an affordable homeownership housing unit shall not
			 exceed:
1. the amount which a low or moderate
			 income household of appropriate size could afford using reasonable assumptions
			 determined by the Department with respect to financing, household assets, and
			 percentage of income available for housing costs; or
2. a sales price allowed as the sales price of the
			 housing unit by a state or federal affordable housing program which has provided
			 financing for or has otherwise subsidized the housing unit.
(e) The affordable housing to be constructed shall
			 have a similar purpose as that of any housing project on such land or, if the land
			 is vacant, with the purposes of the contract for financial assistance respecting
			 such land.
(f) Adequate provision has
			 been made so that the lot or lots of land on which the additional housing will be
			 constructed will be suitably subdivided from the remaining land or a suitable
			 condominium will be created at such time as homeownership housing units are
			 constructed on such lot or lots or at such earlier time as financing is secured by a
			 mortgage on such lot or lots. Any such mortgage shall contain provisions requiring
			 notice to the Department and a reasonable opportunity for it to cure in the event of
			 foreclosure for breach of the terms of such mortgage. Any such mortgage shall also
			 contain such commercially reasonable protections against loss of affordability as
			 are permitted by mortgagee.
(g) Adequate
			 provision has been made so that a state or federal affordable housing program or the
			 Department will approve the plans and description of the new or rehabilitated
			 housing, its estimated construction costs, and its financing and will ensure that
			 proper standards of health, sanitation, and safety are met by such housing. When
			 approval is given by a state or federal affordable housing program, copies of the
			 approval, the approved plans, description and other information must be provided to
			 the Department.
(h) Any market-rate
			 housing units specified in the application appear to be reasonably necessary for the
			 economic feasibility of the construction or operation of the affordable housing
			 units and comprise no more than 25% of the total affordable housing and market-rate
			 housing units, unless the Department shall find that a greater percentage of
			 market-rate housing units is reasonably financially necessary for the economic
			 feasibility of the construction or operation of the affordable housing units.
(i) There is a requirement that public
			 construction and prevailing wage requirements, insofar as applicable, will be
			 complied with in the construction of the housing.
(j) There is a requirement that tenant or
			 homeowner selection procedures including any preferences will be fair and reasonable
			 and will not contravene any applicable state or federal anti-discrimination laws or
			 any state or federal fair housing laws.