Code of Massachusetts Regulations › 606 CMR - DEPARTMENT OF EARLY EDUCATION AND CARE › Title 606 CMR 15.00 - Early Education and Out of School Time Capital Fund Program › Section 15.04 - Type of Grants, Grant Terms, Grant Conditions

Current through Register 1525, July 5, 2024
(1)
Grant Types
.
			 Eligible Projects may receive EEOST Grants for the following uses: the
			 acquisition, design, construction, repair, renovation, recovery from a natural
			 or man-made disaster, rehabilitation, or other capital improvement or deferred
			 maintenance of an Eligible Facility. Eligible Organizations shall complete the
			 application process in accordance with the EEOST Fund Guidelines.
(2)
Grant Terms
. All
			 grants under the EEOST Capital Fund program shall be made upon the terms
			 included in the EEOST Fund Guidelines and/or the EEOST Grant documents
			 including, but not limited to, the Financing Commitment, as well as the
			 following terms:
(a)
Grant
			 Proceeds
. The proceeds of the EEOST Grant shall be used solely for
			 the development of the Eligible Project, as approved by EEC or its Financial
			 Intermediary, and as set forth in the Financing Commitment.
(b)
Grant Amount
.
			 The amount of an EEOST Capital Grant Program shall be established by EEC
			 according to the EEOST Fund Guidelines. EEC may establish a maximum percentage
			 of the Total Development Cost and dollar limits, both by total or by category
			 or both, to which the Grant would also be subject.
(c)
Grant Period
.
			 The original term of an EEOST Grant shall be at least a minimum of 25 years for
			 grantee-owned Eligible Facilities. The original term of an EEOST Grant shall be
			 at least a minimum of 15 years for grantee-leased facilities, unless the
			 building, structure or site is owned, or will be owned by a municipally
			 controlled entity, in which event, the term of the grant would be 25 years. The
			 EEC Commissioner may shorten the minimum grant term for Grants of less than
			 $500,000 that will be used for projects that promote the health and safety of
			 children and staff.
(d)
Grant Recapture
. If for any reason the Eligible
			 Organization does not comply with EEC commitments and requirements, EEC or its
			 Financial Intermediary may recapture the grant funds according to the schedules
			 in 606 CMR 15.04(2)(d)1 and 2., except that the EEC Commissioner may modify
			 these schedules for any shortened grant terms as authorized in 606 CMR
			 15.04(2)(c).
1. For properties owned by the
			 Eligible Organization (25-year grant term):
a.
			 if the noncompliance occurs within nine years of the making of the EEOST Grant,
			 repayment of 100% is due;
b. if the
			 noncompliance occurs between nine years and 16 years after the making of the
			 EEOST Grant, repayment of 67% is due;
c. if the noncompliance occurs between 16
			 years and 25 years after the making of the EEOST Grant, repayment of 33% is
			 due;
d. if the noncompliance occurs
			 more than 25 years after the making of the EEOST Grant, the grant funds will no
			 longer be subject to recapture.
2. For properties leased by the Eligible
			 Organization (15-year grant term):
a. if the
			 noncompliance occurs within five years of the making of the EEOST Grant,
			 repayment of 100% is due;
b. if the
			 noncompliance occurs between five years and ten years after the making of the
			 EEOST Grant, repayment of 67% is due;
c. if the noncompliance occurs between ten
			 years and 15 years after the making of the EEOST Grant, repayment of 33% is
			 due;
d. if the noncompliance occurs
			 more than 15 years after the making of the EEOST Grant, the grant funds will no
			 longer be subject to recapture.
(e)
Land Use
			 Restriction
. The Eligible Organization shall record at the
			 appropriate Registry of Deeds or Registry District of the Land Court, or both,
			 a Land Use Restriction. The Land Use Restriction, and the mortgage referred to
			 in 606 CMR 15.04(2)(e)2., shall only be released:
1. at the end of the term of the Grant if all
			 terms and conditions of the Grant have been fulfilled. However, if the Grant is
			 voluntarily repaid in full prior to the expiration of the Grant term, the Land
			 Use Restriction shall run with the land and remain in effect for the length of
			 the original Grant as described in 606 CMR 15.04(2)(c); or
2. upon foreclosure of a
bona
			 fide
first priority mortgage on the Eligible Facility by the holder
			 thereof, or with EEC's consent a
bona fide
mortgage that was
			 senior to the lien of the recorded Land Use Restriction and mortgage at the
			 time of the closing, or to which the EEOST Land Use Restriction has been duly
			 subordinated.
The EEC Commissioner may waive the requirement for a Land Use
				Restriction for any Grant with a shortened grant term as authorized in 606 CMR
				15.04(2)(c).
(f)
Mortgage Lien
. The EEOST Grant shall be secured by a
			 Mortgage Lien in favor of EEC and/or its Financial Intermediary on the fee
			 simple title to the Eligible Facility, if owned by the Eligible Organization,
			 or on the Eligible Organization's leasehold interest, if the Eligible Facility
			 is leased. The mortgage shall be junior only to a
bona fide
first priority mortgage or such senior mortgage liens as are permitted by EEC
			 or its Financial Intermediary. The EEC Commissioner may waive the requirement
			 for a Mortgage Lien for any Grant with a shortened grant term as authorized in
			 606 CMR 15.04(2)(c).
(g)
Refinancing
. Refinancing of Eligible Projects
			 completed under the EEOST Capital Fund program will be allowed if such
			 refinancing protects the interests of the Commonwealth and either is necessary
			 to effect extraordinary repairs or maintenance which have been approved by EEC
			 or its Financial Intermediary or stabilizes or benefits the Eligible Project
			 that is being refinanced, as determined by EEC or its Financial Intermediary.
			 Any new loan must be due and payable on or after the maturity date of the EEOST
			 Grant. All refinancing is subject to the prior written approval of EEC and/or
			 its Financial Intermediary.
(h)
Application Process
. Application procedures for EEOST
			 Grants are specified in the EEOST Guidelines. EEC reserves the right to hold
			 competitive grant award funding rounds for EEOST Grants and set forth
			 eligibility and scoring criteria in the EEOST Program Guidelines and other
			 materials accompanying the Application and, if applicable, the
			 Preapplication.
(i)
Good Standing
. All EEOST Grant awards will require
			 that each Eligible Organization receiving an EEOST Grant and all programs and
			 facilities that it operates must be licensed by EEC and have valid licenses
			 that are in good standing with EEC and be free of any pending investigations or
			 any pending or past legal actions including, but not limited to, Deficiency
			 Correction Orders, Sanctions Orders, Suspension Orders, Revocation Orders,
			 Refusal to Renew Orders, Fines, or other actions that call into question the
			 Eligible Organization's capacity to care for children in a manner that ensures
			 their safety. All EEOST Grant awards will also require that each Eligible
			 Organization receiving an EEOST grant is in good financial standing with EEC
			 and has no outstanding audit findings from EEC.