Virginia Administrative Code › Title 13 - HOUSING › Agency 10 - VIRGINIA HOUSING DEVELOPMENT AUTHORITY › Chapter 130 - RULES AND REGULATIONS FOR MULTI-FAMILY HOUSING DEVELOPMENTS FOR MENTALLY DISABLED PERSONS › Section 13VAC10-130-60 - Feasibility and commitment

Current through Register Vol. 40, No. 24, July 15, 2024
In order to continue the processing of the application, the
				  applicant shall file, within such time limit as the executive director shall
				  specify, such forms, documents and information as the executive director shall
				  require with respect to the feasibility of the proposed M/D development,
				  including, without limitation, any additions, modifications or other changes to
				  the application and documents previously submitted as may be necessary or
				  appropriate to make the information therein complete, accurate and
				  current.
If not previously obtained, an appraisal of the land and any
				  improvements to be retained and used as a part of the M/D development will be
				  obtained at this time or as soon as practical thereafter from an independent
				  real estate appraiser selected or approved by the authority. The authority may
				  also obtain such other reports, analyses, information and data as the executive
				  director deems necessary or appropriate to evaluate the proposed M/D
				  development.
If at any time the executive director determines that the
				  applicant is not processing the application with due diligence and best efforts
				  or that the application cannot be successfully processed to commitment and
				  initial closing within a reasonable time, he may, in his discretion, terminate
				  the application and retain any fees previously paid to the authority.
The authority staff shall review and evaluate the
				  application, the documents and information received or obtained pursuant to
				  13VAC10-130-50 and this section.
				  Such review and evaluation shall include, but not be limited to, the
				  following:
1. An analysis of the
				estimates of construction costs and the proposed operating budget and an
				evaluation as to the economic feasibility of the proposed M/D
				development;
2. A review of the
				tenant selection plan, including its effect on the economic feasibility of the
				proposed development and its efficacy in carrying out the programs and policies
				of the authority;
3. A final review
				of the ability, experience and financial capacity of the applicant;
4. An analysis of the architectural and
				engineering plans, drawings and specifications, including the functional use
				and living environment for the proposed residents, the marketability of the
				units, the amenities, services and facilities to be provided to the proposed
				residents, and the management, maintenance and energy conservation
				characteristics of the proposed development.
Based upon the authority staff's analysis of such documents
				  and information and any other information obtained by the authority in its
				  review of the proposed development, the executive director shall approve the
				  issuance of a mortgage loan commitment to the applicant with respect to the
				  proposed development only if he determines that all of the following criteria
				  have been satisfied:
1. The vicinity
				of the proposed M/D development is and will continue to be a residential area
				suitable for the proposed M/D development and is not now, nor is it likely in
				the future to become, subject to uses or deterioration which could cause undue
				depreciation in the value of the proposed M/D development or which could
				adversely affect its operation, marketability or economic
				feasibility.
2. There are or will
				be available on or before the estimated completion date (i) direct access to
				adequate public roads and utilities and (ii) such public and private facilities
				(such as schools, churches, transportation, retail and service establishments,
				parks, and recreational facilities) in the area of the proposed M/D development
				as the executive director determines to be necessary or desirable for use and
				enjoyment by the contemplated residents.
3. Based on the data and information received
				or obtained pursuant to this section, no material adverse change has occurred
				with respect to compliance with the criteria set forth in
				13VAC10-130-50 of this
				chapter.
4. The applicant's
				estimates of housing development costs (i) include all costs necessary for the
				development and construction of the proposed M/D development, (ii) are
				reasonable in amount, (iii) are based upon valid data and information, and (iv)
				are comparable to costs for similar multi-family rental developments; provided,
				however, that if the applicant's estimates of such costs are insufficient in
				amount under the foregoing criteria, such criteria may nevertheless be
				satisfied if, in the judgment of the executive director, the mortgagor will
				have the financial ability to pay any costs estimated by the executive director
				to be in excess of the total of the applicant's estimates of housing
				development costs.
5. Subject to
				review by the authority, in the case of construction loans at final closing or
				in the case of permanent loans at closing, the categories of the estimated
				housing development costs to be funded from the proceeds of the mortgage loan
				are eligible for such funding under the authority's closing documents or under
				such other requirements as shall be agreed to by the authority.
6. Any administrative, community, health,
				nursing care, medical, educational, recreational, commercial or other
				non-housing facilities to be included in the proposed M/D development are
				incidental or related to the proposed M/D development and are necessary,
				convenient or desirable with respect to the ownership, operation or management
				of the proposed M/D development.
7.
				The estimated income from the proposed M/D development, including any federal
				subsidy or assistance, is sufficient to pay when due the estimates of the debt
				service on the mortgage loan, the operating expenses, and replacement and other
				reserves required by the authority.
8. The drawings and specifications or other
				description of the work to be performed shall demonstrate that the proposed M/D
				development as a whole and the individual units therein shall provide safe,
				habitable, and pleasant living accommodations and environment for the
				contemplated residents.
9. The
				tenant selection plan submitted by the applicant shall comply with these rules
				and regulations and shall be satisfactory to the authority.
10. The proposed M/D development will comply
				with:
(i) all applicable federal laws and
				regulations governing the federal tax exemption of the notes or bonds issued or
				to be issued by the authority to finance the proposed development and
(ii) all requirements set forth in
				the resolutions pursuant to which such notes or bonds are issued or to be
				issued.
11. The
				prerequisites necessary for the members of the applicant to acquire, own,
				construct or rehabilitate, operate and manage the proposed M/D development have
				been satisfied or can be satisfied prior to initial closing. These
				prerequisites include, but are not limited to obtaining:
(i) site plan approval,
(ii) proper zoning status,
(iii) assurances of the availability of the
				requisite public utilities,
(iv)
				commitments by public officials to construct such public improvements and
				accept the dedication of streets and easements that are necessary or desirable
				for the construction and use of the proposed M/D development,
(v) building permits, and
(vi) fee simple ownership of the site, a
				sales contract or option giving the applicant or mortgagor the right to
				purchase the site for the proposed development and obtain fee simple title, or
				a leasehold interest of the time period required by the Act (any such ownership
				or leasehold interest acquired or to be acquired shall be free of any
				covenants, restrictions, easements, conditions, or other encumbrances which
				would adversely affect the authority's security or the construction or
				operation of the proposed M/D development).
12. The proposed M/D development will comply
				with all applicable state and local laws, ordinances, regulations, and
				requirements.
13. The proposed M/D
				development will contribute to the fulfillment of the public purposes of the
				authority as set forth in its Act.
If the executive director determines that one or more of the
				  foregoing criteria have not been adequately satisfied, he may nevertheless in
				  his discretion, approve the issuance of a commitment, subject to the
				  satisfaction of such criteria, in such manner and within such time period as he
				  shall deem appropriate.
The term of the M/D loan, the amortization period, the
				  estimated housing development costs, the principal amount of the M/D loan, the
				  terms and conditions applicable to any equity contribution by the applicant,
				  any assurances of successful completion and operational stability of the
				  proposed M/D development, and other terms and conditions of such M/D loan shall
				  be set forth in the commitment issued on behalf of the authority. The
				  commitment shall also include such terms and conditions as the authority
				  considers appropriate with respect to the construction of the proposed M/D
				  development, the marketing and occupancy of such M/D development (including any
				  income limits or occupancy restrictions other than those set forth in these
				  rules and regulations), the disbursement and repayment of the loan, and other
				  matters related to the construction and the ownership, operation and occupancy
				  of the proposed M/D development. Such commitment may include a financial
				  analysis of the proposed M/D development, setting forth the approved initial
				  budget for the operation of the M/D development and a schedule of the estimated
				  housing development costs.
If the executive director determines not to issue a
				  commitment, he shall so notify the applicant.