(a) The Housing Bond Credit Committee shall, after consultation with appropriate agencies including, but not limited to, the Department of Business and Economic Development, the Department of Housing and Community Development, the Governor’s Office of Planning and Research, the California Housing Finance Agency, the Senate Office of Research, the Assembly Office of Research, and the Department of Finance, designate areas of chronic economic distress in conformity with paragraph (3) of subdivision (k) of Section 103 (A) of the Internal Revenue Code. Criteria to be used in designating areas of chronic economic distress include:

1. (1) The condition of the housing stock, including the age of the housing and the number of abandoned and substandard residential units.
2. (2) The need of area residents for owner-financing under this section, as indicated by low per capita income, a high percentage of families in poverty, a high number of welfare recipients, and high unemployment rates.
3. (3) The potential for use of owner-financing under this section to improve housing conditions in the area.
4. (4) The existence of a housing assistance plan which provides a displacement program and a public improvements and services program.

(b) The committee may evaluate and include other criteria it considers appropriate in determining areas of chronic economic distress, including, but not limited to:

1. (1) Low vacancy rates in residential units.
2. (2) Low volume of mortgage loan activity.
3. (3) The percentage of households paying more than 35 percent of income for rent.
4. (4) The existence of adequate transportation facilities between such designated areas and areas of employment concentration.

(c) State agencies and local agencies, including, but not limited to, redevelopment agencies, housing authorities or other local entities authorized by the laws of this state to issue qualified mortgage bonds, may recommend on or before February 15 of each calendar year, the designation of an area of chronic economic distress to the committee.

The committee shall review all such proposals in making designations in accordance with paragraph (3) of subdivision (K) of Section 103 (A) of the Internal Revenue Code or any appropriate regulations. The State Treasurer or his or her designee, shall be responsible for seeking approval of that designation by the Secretary of the Treasury and the Secretary of Housing and Urban Development of the United States and providing certification of these designations and is hereby designated as the official to make certifications for purposes of federal law.