1. (a) To be eligible for funding, a proposed project must

   1. (1) involve either of the following:

      1. (A) the development and construction of a new rental housing development, or

      2. (B) the rehabilitation of (which may include seismic improvements to) one or more of the following structures:

         1. 1. a substandard rental housing development;
         2. 2. a residential structure eligible for seismic rehabilitation improvements pursuant to section 8129;
         3. 3. an existing structure that will undergo a conversion; or
         4. 4. an existing substandard residential structure that will undergo reconstruction.
   2. (2) include supportive services pursuant to section 8127 and a job training and placement program pursuant to section 8128.

2. (b) Except as specified in subdivision (c), proposed rental housing developments are ineligible if construction work has begun prior to the effective date of the Standard Agreement. For the purposes of this subdivision, construction work shall not include the following:

   1. (1) for loans involving new construction, site improvements intended for public dedication; demolition; site preparation; and grading;
   2. (2) for loans involving rehabilitation, work required to correct an emergency situation; work done pursuant to an order of the court or agency having jurisdiction over the project; and regular maintenance of the project.

3. (c) Where construction work, other than that allowed pursuant to subdivision (b), has begun prior to the effective date of the Standard Agreement, proposed rental housing developments are eligible only under the following circumstances:

   1. (1) construction has been halted, and the project property has been foreclosed upon or is in foreclosure;
   2. (2) construction has been halted, and the project property has been deeded to a lender in lieu of foreclosure;
   3. (3) construction has been halted, and there is a substantial likelihood that a lender will initiate foreclosure due to the inability of the project's developer to complete construction; or
   4. (4) construction on a separate distinct phase of the project has been or will be completed without program loan funds; provided that, when completed, either the separate phase or the project as a whole meets all program requirements.

4. (d) Proposed projects involving the demolition of residential rental units are eligible only if the sponsor complies with the relocation requirements set forth in section 8125 and only if one of the following circumstances exist:

   1. (1) the units to be demolished are substandard, and not economically feasible to rehabilitate; or
   2. (2) the number of assisted units in the new project is at least twice the total number of units in the demolished structures.

Note: Authority cited: Sections 50406(n), 50884 and 50895, Health and Safety Code. Reference: Section 50881.5, Health and Safety Code.

History

1. New section filed 12-14-90 as an emergency; operative 12-14-90 (Register 91, No. 11). A Certificate of Compliance must be transmitted to OAL by 4-15-91 or emergency language will be repealed by operation of law on the following day.

2. Repealed by operation of law on 4-16-91.

3. New section filed 7-19-91 as an emergency; operative 7-19-91 (Register 92, No. 16). A Certificate of Compliance must be transmitted to OAL 11-6-91 or emergency language will be repealed by operation of law on the following day.

4. New section refiled 11-15-91 as an emergency; operative 11-15-91 (Register 92, No. 16). A Certificate of Compliance must be transmitted to OAL 3-16-92 or emergency language will be repealed by operation of law on the following day.

5. Certificate of Compliance as to 11-15-91 order transmitted to OAL 12-12-91 and filed 1-13-92 (Register 92, No. 16).