1112 - Affordable home ownership development contracts.

§ 1112. Affordable home ownership development contracts. 1. Within the  limit  of funds available in the affordable housing development account,  the corporation is  hereby  authorized  to  enter  into  contracts  with  eligible applicants to provide grants which such applicants shall use to  finance  affordable  home  ownership development programs subject to the  terms  and  conditions  of  this  article.  Any  grants  received  by  a  municipality  hereunder  shall  not  be  deemed  to  be municipal funds.  Grantees shall utilize funds provided pursuant to this article solely as  payments, grants and  loans  to  owners  to  reduce  the  costs  of  new  construction,   rehabilitation  or  home  improvement  or  the  cost  of  acquisition, but only where such acquisition is part  of  an  affordable  home   ownership   development   program  or  project  to  construct  or  rehabilitate homes, or as otherwise authorized by  law.  Such  financial  assistance may be in the form of loans, participation in loans including  but  not  limited  to  participation  in loans originated or financed by  lending institutions as defined in section forty-two  of  this  chapter,  private  or  public  employee  pension  funds  or  the state of New York  mortgage agency, or grants, on such terms and conditions as the  grantee  with  the  approval of the corporation shall determine, provided that no  such payments, grants and loans shall exceed the  lesser  of  (i)  sixty  percent  of  the  project  cost  or (ii) the following per dwelling unit  limitations (A) thirty-five thousand  dollars  for  projects  except  as  provided  in  clause (B) of this item (ii) or (B) forty thousand dollars  for a high cost project or a project which will receive a loan from  the  federal  farmers home administration. Among the criteria the corporation  shall consider in determining whether a project is a high  cost  project  are:  average cost of construction in the area, location of the project,  and the impact of the additional funding on  the  affordability  of  the  project for the occupants of such project. No more than fifty percent of  the  total  amount  appropriated  pursuant to this article in any fiscal  year shall be allocated to homes located within any single municipality.    2. The corporation shall not enter into a contract under this  article  except  with  an  eligible  applicant which has submitted an application  pursuant to a request for proposals  issued  by  the  corporation  which  application contains a plan acceptable to the corporation which provides  that:    (a)  The  proposed  project  or  program  will  make  home  ownership,  rehabilitation or home improvement  affordable  to  persons  who  cannot  afford  to  own,  rehabilitate  or  improve  homes  by  relying upon the  ordinary unaided operation of private enterprise.    (b) There shall be criteria, satisfactory to  the  corporation,  which  provide  for  maximum income limitations or a system of income targeting  designed  to  ensure  that  home  buyers  who  benefit  from   financial  assistance provided pursuant to this article would be unable to acquire,  rehabilitate  or  improve  homes  by  relying  upon the ordinary unaided  operation of private enterprise.    (c) The payments, grants and loans provided by  grantees  pursuant  to  this  article will be supplemented by private or other public investment  and the payments, grants and loans provided by the grantee are the least  necessary to make home ownership,  rehabilitation  or  home  improvement  affordable  to  the income group to be served by the proposed project or  program.    (d) The proposed project or projects, if not built or rehabilitated by  a not-for-profit corporation,  will  be  built  or  rehabilitated  by  a  private  developer/builder  who  has  agreed  to  limit  his  profit  in  accordance with a formula, satisfactory to the  corporation,  which  has  been established by the grantee.(e) The proposed project or program will provide assistance in an area  which  is  blighted,  deteriorated  or deteriorating, or has a blighting  influence on the surrounding area, or is in danger of becoming a slum or  a blighted area because of the  existence  of  substandard,  insanitary,  deteriorating  or  deteriorated  conditions,  an  aged housing stock, or  vacant  non-residential  property,  or  other  factors   indicating   an  inability  or  unwillingness  of the private sector unaided to cause the  construction, rehabilitation or home  improvement  for  which  payments,  grants and loans under this article is provided.    (f)  Home  buyers  will  occupy  homes  as  their  principal  place of  residence and funds provided for the benefit of the home buyer  will  be  recaptured  by the grantee if the home buyer does not occupy the home as  the home buyer's principal  place  of  residence  under  the  terms  and  conditions of a formula established or approved by the corporation.    (g)  In  the case of a rehabilitation or home improvement program, the  majority of payments, grants and loans provided for each home  shall  be  used to perform work which prolongs the useful life of the home or shall  be  used to correct basic structural defects or to repair basic building  systems which threaten or if not corrected or  repaired  could  threaten  the health and safety of the dwelling's residents.    (h)  The  corporation  shall  provide  the  applicant  with  a list of  conditions that must be met prior to entering into a  contract  pursuant  to  this  article.  Within  fifteen  working  days  of  receipt  by  the  corporation  of  all  documents  in  satisfaction  of  the   list,   the  corporation   shall   notify   the   applicant  of  the  sufficiency  or  insufficiency of the documents. After satisfaction by the  applicant  of  all  conditions  required  by  the  corporation prior to entering into a  contract the corporation shall enter into the contract within forty-five  working days of satisfaction of such conditions.    (i) Eligible applicants receiving awards pursuant to this article  for  homes  located  in  cities  with a population of one hundred thousand or  more shall provide preference to homebuyers who are members of a  police  force  of  such  city,  provided  that such city has adopted a local law  authorizing such preference.    3. In determining awards pursuant  to  this  article  the  corporation  shall give preference to applications based upon the extent to which the  proposed program or project will:    (a) Serve the lowest income households in the applicable region and is  designed  to  continue  to  be  affordable  to  such  households  for  a  substantial period of time.    (b) Leverage private and other public investment so as to  reduce  the  amount  of  assistance  provided  pursuant  to  this  article  which  is  necessary to operate or establish the program or project.    (c) Contribute to the development of the neighborhood or community  in  which the program or project is located.    (d) Not directly displace current low and moderate income residents of  such neighborhood or community.    (e) Be undertaken and completed in a timely fashion.    (f)  Utilize innovative, cost effective design techniques and building  materials, which reduce construction, rehabilitation or operating  costs  including, but not limited to factory built or modular homes.    (g) Be located on a brownfield site that has received a certificate of  completion.    4.  The corporation shall not provide a grant to an eligible applicant  pursuant to this article unless the corporation determines that there is  a strong probability that the  private  investment  in  the  applicant's  proposed  program would not be made without the grant and that the grantwill not substitute for private funds which would be otherwise available  to the program.    5. The corporation shall provide for the review, at periodic intervals  not  less  than  annually,  of  the  performance  of  grantees receiving  financial assistance pursuant to this article. Such review shall,  among  other  things,  be  for  the  purposes  of  ascertaining  conformity  to  contractual  provisions,  the  financial  integrity  and  efficiency  of  grantees  and  the  evaluation  of  the  grantees' activities. Contracts  entered into pursuant to this article may be terminated,  funds  may  be  withheld  and unspent funds recaptured by the corporation upon a finding  of  substantial  nonperformance  or  breach  by  the  grantee   of   its  obligations under its contract.