CHAPTER 3. MUTUAL HOUSING ASSOCIATIONS
IC 5-20-3
Chapter 3. Mutual Housing Associations
IC 5-20-3-1
"Families of low and moderate income" defined
Sec. 1. As used in this chapter, "families of low and moderate
income" has the meaning set forth in IC 5-20-1-2.
As added by P.L.69-1989, SEC.3.
IC 5-20-3-2
"Housing project" defined
Sec. 2. (a) As used in this chapter, "housing project" means any
work or undertaking to provide decent, safe, and sanitary urban or
rural dwellings, apartments, or other living accommodations for
families of low and moderate income, including:
(1) buildings, land, equipment, facilities, and other real or
personal property for necessary, convenient, or desirable
appurtenances, streets, sewers, water service, parks, site
preparation, gardening, administrative, community, recreational,
commercial, or welfare purposes; and
(2) the acquisition and rehabilitation of existing dwelling units
or structures to be used for moderate or low rental units.
(b) The term includes the planning of the buildings and
improvements, the acquisition of property, the demolition of existing
structures, the construction, reconstruction, alteration, and repair of
the improvements, and all other connected work. The term includes
the reconstruction, rehabilitation, alteration, or major repair of
existing buildings or improvements.
As added by P.L.69-1989, SEC.3.
IC 5-20-3-3
"Mutual housing association" defined
Sec. 3. As used in this chapter, "mutual housing association"
refers to a corporation established under section 4 of this chapter.
As added by P.L.69-1989, SEC.3.
IC 5-20-3-4
Establishment of mutual housing association; articles of
incorporation
Sec. 4. (a) A mutual housing association may be established as a
nonprofit corporation incorporated under IC 23-7-1.1 (before its
repeal on August 1, 1991) or IC 23-17 to prevent and eliminate
neighborhood deterioration and to preserve neighborhood stability
by:
(1) providing high quality, long term housing for families of
low and moderate income; and
(2) affording community and residential involvement in the
provision of that housing.
(b) The articles of incorporation of a mutual housing association
must be approved by the authority.
(c) The articles of incorporation of a mutual housing association
must include a provision that provides that if the mutual housing
association dissolves, is involved in a bankruptcy proceeding, or
otherwise disposes of its physical properties, the association may
only transfer the assets to another entity that provides high quality
long term housing for families of low and moderate income.
As added by P.L.69-1989, SEC.3. Amended by P.L.179-1991, SEC.8;
P.L.1-1992, SEC.12; P.L.1-2006, SEC.108 and P.L.181-2006,
SEC.23; P.L.145-2008, SEC.8.
IC 5-20-3-5
Articles of incorporation of mutual housing association; purposes
Sec. 5. A mutual housing association must have as one (1) of its
purposes in its articles of incorporation the construction,
rehabilitation, development, ownership, or operation (including the
management and maintenance of housing) of high quality long term
housing for families of low and moderate income.
As added by P.L.69-1989, SEC.3.
IC 5-20-3-6
Contracts for state financial assistance; mutual housing
associations; grants and loans
Sec. 6. The Indiana housing and community development
authority may enter into a contract with a mutual housing association
to provide financial assistance for the construction, rehabilitation,
ownership, or operation of housing for families of low and moderate
income. State financial assistance may be in the form of grants,
loans, or a combination of grants and loans and may be used for the
acquisition or development of housing sites and for the costs incurred
in the development of the housing. Grants may not exceed the
development cost of the housing project.
As added by P.L.69-1989, SEC.3. Amended by P.L.1-2006, SEC.109
and P.L.181-2006, SEC.24.
IC 5-20-3-7
Contracts for state financial assistance; mutual housing
associations; provisions
Sec. 7. A contract for state financial assistance with a mutual
housing association under section 6 of this chapter must include (for
each housing site) the following provisions:
(1) Each housing site must be managed in an efficient manner
to permit the fixing of the rentals at the lowest possible rates
consistent with providing decent, safe, and sanitary dwelling
accommodations.
(2) A mutual housing association may not construct or operate
a housing site for profit.
(3) Rental rates may not be fixed a level higher than necessary
to produce revenue that, together with other revenue, will be
sufficient to pay, as it becomes due, the principal and interest
on the loans made to the mutual housing authority, the
maintenance and operating expenses of a housing project
(including insurance and administrative costs), and an
allowance for a reasonable return on equity capital contributed
to a housing project through membership fees or nonstate
grants. The rentals must be within the financial reach of
families of low income. The return on equity capital must be
used by the mutual housing association to develop additional
dwelling units.
(4) The mutual housing association, subject to the approval of
the Indiana housing and community development authority,
shall fix the maximum income limits for the admission and
continued occupancy of families in the housing. The association
shall define the income of a family to provide the basis for
determining eligibility for the admission, rent, and continued
occupancy of families under the maximum income limits. In
defining family income, the authority may provide for the
exclusion of any part of the income of family members that the
authority believes generally available to meet the cost of basic
living needs of the family.
(5) The mutual housing association may not refuse to rent a
dwelling accommodation to an otherwise qualified applicant
because one (1) or more of the proposed occupants are children
born out of wedlock.
(6) The mutual housing association shall provide each applicant
for admission to the housing project a receipt stating the time
and date of application and shall maintain a list of the
applications that must be available for public inspection. The
Indiana housing and community development authority shall
adopt rules governing the form and procedure for maintaining
the list.
(7) The mutual housing association may require the payment of
a membership fee as a condition of eligibility of occupancy for
a dwelling unit. The fee must be refunded to a resident member,
with nominal interest, when the member vacates the dwelling
unit.
(8) The Indiana housing and community development authority
shall require and must approve an operation management plan
for each housing project from the mutual housing association.
The plan must provide for an income adequate to pay debt
service, administrative costs (including a state service charge),
operating costs, and adequate reserves for repairs, maintenance,
replacements, and vacancy and collection losses. In addition,
the mutual housing association shall adopt a plan for the
administration of a housing project that must be approved by
the tenants and the Indiana housing and community
development authority. The association shall provide copies of
the plan to each adult tenant and to the Indiana housing and
community development authority.
(9) The Indiana housing and community development authority
may inspect any housing during the period of the loan or, in the
case of a grant, during the period when a housing project is used
to house families of low and moderate income.
(10) The mutual housing association shall semiannually submit
a report to the Indiana housing and community development
authority with information on operating costs, tenant
information, rentals, and any other information that the Indiana
housing and community development authority requires by rule.
(11) The mutual housing association may request permission of
the Indiana housing and community development authority to
allow the continued occupancy of dwelling units by tenants
whose annual income exceeds maximum limits or the rental of
vacant units to tenants whose income exceeds maximum limits
if the vacancies would result in the inability to pay debt service,
administrative costs (including state service charges), operating
costs, and reserve for repairs, maintenance, replacements, and
collection costs. The continued occupancy or rental must be for
a period of one (1) year, subject to subsequent one (1) year
renewals. The mutual housing association may, subject to the
approval of the Indiana housing and community development
authority, fix rent at a higher level for tenants described in this
subdivision.
(12) The difference between the increased rent and the normal
rent described in subdivision (11) must be used by the mutual
housing association to develop additional dwelling units or
credited against the rent owed by another low or moderate
income resident member of the association.
(13) The cost of options on housing sites, engineering and
architectural services, and preliminary construction expenses
may, subject to the approval of the Indiana housing and
community development authority, be included as part of the
cost of a project to be financed by a loan or grant.
(14) The mutual housing association may provide for variable
rents based on family income.
As added by P.L.69-1989, SEC.3. Amended by P.L.1-2006, SEC.110
and P.L.181-2006, SEC.25.
IC 5-20-3-8
Service charges; mutual housing associations; loans and grants
Sec. 8. The Indiana housing and community development
authority may assess a mutual housing association a service charge
for each loan or grant provided to the association.
As added by P.L.69-1989, SEC.3. Amended by P.L.1-2006, SEC.111
and P.L.181-2006, SEC.26.
IC 5-20-3-9
Mutual housing association; resident requirements
Sec. 9. A resident of a mutual housing association:
(1) must participate in the ongoing operation and management
of the housing;
(2) must have a right to continue residing in the housing as long
as the resident complies with the terms of the occupancy
agreement; and
(3) may not possess an equity or ownership interest in the
housing.
As added by P.L.69-1989, SEC.3.
IC 5-20-3-10
Rules
Sec. 10. The Indiana housing and community development
authority shall adopt rules under IC 4-22-2 to carry out this chapter.
As added by P.L.69-1989, SEC.3. Amended by P.L.1-2006, SEC.112
and P.L.181-2006, SEC.27.