WSR 99-24-041

PROPOSED RULES

HOUSING FINANCE COMMISSION


[ Filed November 24, 1999, 10:06 a.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 99-20-067.

Title of Rule: Private activity bond allocation.

Purpose: Provide procedures pursuant to which the commission will distribute a portion of the state's private activity bond allocation among competing multifamily housing projects.

Statutory Authority for Adoption: RCW 43.180.040(3).

Statute Being Implemented: RCW 43.180.050.

Summary: The proposed rules establish the commission's procedures for distributing a portion of the state's private activity bond allocation among competing multifamily housing projects.

Reasons Supporting Proposal: The proposed rule provides applicants to the commission's private activity bond allocation program with clear direction regarding the fundamental criteria by which private activity bond allocations will be distributed by the commission.

Name of Agency Personnel Responsible for Drafting, Implementation and Enforcement: Paul Edwards, Deputy Director, 1000 Second Avenue, Suite 2700, Seattle, WA 98104-1046, (206) 464-7139 ext. 118.

Name of Proponent: Washington State Housing Finance Commission, governmental.

Rule is not necessitated by federal law, federal or state court decision.

Explanation of Rule, its Purpose, and Anticipated Effects: As noted above, the rules establish the fundamental criteria and conditions a multifamily housing project must satisfy to qualify to receive an allocation from the commission. The rule is intended to provide clear guidance for applicants seeking a private activity bond allocation from the commission.

Proposal does not change existing rules.

No small business economic impact statement has been prepared under chapter 19.85 RCW. Statement not required under RCW 19.85.030(1) because proposed rule will not impose "more than minor costs on businesses in an industry."

Section 201, chapter 403, Laws of 1995, does not apply to this rule adoption. Pursuant to subsection (5) of section 201, chapter 403, Laws of 1995, the statute does not apply to this rule adoption. It is not an agency listed in subsection (5)(a)(i), nor has it been voluntarily made applicable to the agency as described in subsection (5)(a)(ii).

Hearing Location: Washington State Housing Finance Commission, 1000 Second Avenue, 28th Floor, Seattle, WA 98104-1046, on January 27, 2000, at 1:00 p.m.

Assistance for Persons with Disabilities: Contact Paul Edwards by January 18, 2000, (206) 464-7139.

Submit Written Comments to: Mr. Paul Edwards, Deputy Director, 1000 Second Avenue, Suite 2700, Seattle, WA 98104-1046, fax (206) 587-5113, by January 26, 2000.

Date of Intended Adoption: January 27, 2000.

November 19, 1999

Paul R. Edwards

Deputy Director

OTS-3542.1


NEW SECTION
WAC 262-01-140
Private activity bond allocation.

(1) Applicants for the commission's portion of the state's private activity bond allocation shall submit a completed application in the form prescribed by the commission and the required application fee by the deadline set by the commission each application round.

(2) As part of its application, each applicant shall demonstrate to the commission's satisfaction that it is ready to proceed with the financing of its project.

(3) In order to qualify to receive an allocation from the commission, a project shall meet the requirements of the code and shall be in compliance with local land-use, zoning and permitting processes. To comply with the code, at minimum, a project shall:

(a) Have:

(i) Twenty percent of the units set aside for individuals whose income is fifty percent or less of area median gross income; or

(ii) Forty percent of the units set aside for individuals whose income is sixty percent or less of area median gross income;

(b) Be available for use by the general public;

(c) Be used on other than a transient basis;

(d) Include separate and complete facilities for living, sleeping, eating, cooking and sanitation;

(e) Have been the subject of a public hearing.

(4) For the purposes of ranking projects and making allocations, the commission will give weight to those projects which, among other things:

(a) Promote the development of affordable housing in underserved areas;

(b) Execute a regulatory agreement with the commission having terms that exceed the minimum code requirement;

(c) Reserve units for special-needs populations;

(d) Preserve federally assisted projects as low-income units;

(e) Have sought and received financial assistance from federal, state or local governments;

(f) Opt to leverage the tax-exempt bonds with other sources of funds including taxable bonds.

(5) As a condition of receiving an allocation, an owner shall enter into a regulatory agreement with the commission, in a form acceptable to the commission, which restricts the use of the project for a period of time and which describes the applicable commitments and covenants made by the owner. The agreement shall be recorded as a restrictive covenant running with the land.

(6) Upon receiving an allocation, an applicant shall pay all required commission fees and comply with all applicable requirements and deadlines. Failure to do so may result in withdrawal of the allocation.

(7)(a) The commission may perform on-site inspections of projects, interview residents, review residents' applications and financial information and review an applicant's or an owner's books and records. The applicant or owner shall provide the commission with all requested documentation, including periodic reports and certificates; shall provide the commission access to the project; and shall retain records as required by the code and the regulatory agreement.

(b) The commission will monitor the projects receiving an allocation to verify compliance with the code and with contractual commitments to the commission. The commission will notify the Internal Revenue Service when instances of noncompliance come to its attention.

(8) Unless the commission makes an exception, a transfer of an interest in a project shall require the prior approval of the commission.

(9) Decisions regarding allocations will be made on behalf of the commission by the director of the capital projects division and will be appealable solely to the executive director of the commission.

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