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(continued)
"Cooperative corporation" means an entity established as as a stock cooperative corporation as defined by Section 11003.2 of the Business and Professions Code.
"Debt service" means the total monthly payments of principal and interest on a mortgage loan for the assisted property, any loan insurance fees associated with the loan, property taxes and assessments, and fire and casualty insurance. Where debt service is in connection with purchase of a space or a right of occupancy of a space in a mobilehome part, such debt service shall include any debt service which exists with regard to a mobilehome located on such space.
"Department" means the California Department of Housing and Community Development.
"Development cost" means the aggregate of all costs incurred in connection with construction of a mobilehome park including, but not limited to, the cost of:
(1) land acquisition, whether by purchase or lease;
(2) overhead, including engineering, architectural, legal and accounting fees;
(3) construction of the mobilehome spaces and related structures;
(4) off-site improvements, including utilities, sewers and streets;
(5) construction of necessary support and community facilities;
(6) necessary on-site improvements;
(7) acquisition and installation of mobilehomes, including accessory buildings and structures as defined in Section 19213 of the Code; and
(8) moving expenses of households displaced as a result of the development of the mobilehome park.
Development costs do not include the cost of permanent financing of a mobilehome park or mobilehome space.
"Down payment" means an initial payment made by a purchases which contributes to the purchase of assisted property.
"Eligible Household" means a person or family:
(1) whose income does not exceed the median income of the county in which the property eligible to to purchased under this Program is located. Such income shall be calculated in accordance with adjustments for family size established or published by the Department;
(2) who does not at the time assistance is provided to it under the Program, or has not in the three (3) years immediately preceding the provision of such assistance, owned any residential real property, other than a mobilehome not affixed to permanent foundation;
(3) who has not previously received any direct assistance under this Program; and
(4) who would be unable to purchase eligible property without assistance under the Program as determined by Section 7908.
The provision of assistance pursuant to Section 7904(a) (3) shall not be construed to render a household ineligible for assistance pursuant to Section 7904(a) (4) of these regulations.
"Financial assistance" means monies from the Fund.
"Fund" means the Homeownership Assistance Fund.
"Governmental agency" means a city, county, or city and county within the State and any department, division, or public agency of the State including a housing authority, redevelopment agency, or community development commission; or two or more of such entities acting jointly; or the duly constituted government body of an Indian reservation or rancheria.
"Gross income" means all income as defined by Title 25, California Administrative Code, Section 6914 excluding the definition of "net family assets" in subdivision (b) of Section 6914 which for the purpose of the Program shall be defined as provided in Section 7908 (b) of these regulations.
"Improvements" means substantial repairs, renovations or additions undertaken with respect to property purchased with assistance under the Program, which increase the value of such property or bring such property into conformance with local or state building or housing standards.
(1) "improvements" includes:
(A) replacement of built-in appliances, fixtures and equipment which were originally sold as part of the unit, and will remain a part of the unit, or replacement of structural components of the unit, including a roof, plumbing and electrical systems, provided that replacement is required by the nonoperative, deteriorated, or obsolescent nature of the original appliance, fixture equipment or structural component;
(B) replacement to the common area of a condominium cooperative or mobile home park resulting in a mandatory assessment by a homeowners association or cooperative corporation and;
(C) permanent additions to the unit including, but not limited to, rooms, carports, cabanas, awnings, decks, air conditioning.
(2) "Improvements" does not include:
(A) Routine or cosmetic maintenance such as painting and replacement of carpet, broken windows and screens which is necessary due to normal wear and tear; and
(B) replacement or repair of items damaged or destroyed because of a fire or natural disaster, unless such activity is necessary to bring such property into conformance with local or state building or housing standards.

"Interim financing" means a short-term mortgage loan which is repaid when permanent financing is secured. "Interim financing" includes a land acquisition loan and a construction loan to finance the construction of land improvements.
"Mobilehome" means a structure as defined by Section 18211 of the Code.
"Mobilehome park" means a mobilehome site as defined by Section 18214 of the Code and, for the purposes of this program, shall include sites where spaces are individually owned by occupants of the park or owned by a stock cooperative corporation.
"Monthly housing cost" means the total of monthly payments of principal and interest on a mortgage loan or loans, any loan insurance fees associated with the loan(s), property taxes and assessments, fire and casualty insurance, property maintenance and repairs, utilities (not including telephone service), homeowner association fees and assessments and space rent, if any.
Where "monthly housing costs" are in connection with the purchase of a space or a right of occupancy of space in a mobilehome park, "monthly housing costs" shall include any housing costs which exist with regard to a mobilehome located on such space.
"Mortgage lender" means a bank or trust company, mortgage banker, federal or state chartered savings and loan association, governmental agency, credit union or other financial institution certified in accordance with Section 7910.
"Nonprofit corporation" means a nonprofit corporation incorporated pursuant to Part 1 (commencing with Section 5000) of Division 2 of Title 1 of the Corporations Code and includes a cooperative corporation.
"Permanent foundation" means a mobilehome foundation system as defined or approved by the Department pursuant to Section 18551 of the Code and Section 1333, Chapter 2, Title 25, California Administrative Code.
"Program" means the Homeownership Assistance Program.
"Property" includes any real or personal property, the purchase of which is eligible for assistance under the Program. "Property" includes a converted rental unit, mobilehome or mobilehome park space, and a share in a cooperative corporation including a dwelling unit which is the subject of such share.

"Purchase price" means the price paid by an eligible purchaser to a seller of property to be purchased with assistance under the Program and shall equal the amount on which the transfer tax is paid in connection with the purchase of the property.
"Purchaser" means an eligible household or a nonprofit corporation which is purchasing or has purchased property with assistance under the Program.
"Recipient" means a household or nonprofit corporation which has received financial assistance under the Program.
"Rental unit" means a dwelling unit in rental housing or a space, or a mobilehome in mobilehome park where the occupant rents the space, the mobilehome or both.
"Rural area" means any open country or any place, town, village, or city which by itself and taken together with any other places, towns, villages or cities that it is part of or associated with:
(1) has a population not exceeding 10,000 or
(2) has a population not exceeding 20,000 and is contained within a nonmetropolitan area.
"Rural Area" also includes any open country, place, town, village, or city located within a Standard Metropolitan Statistical Area if the population thereof does not exceed 20,000 and the area is not part of, or associated with, an urban area and is rural in character.
"Sales price" means the amount for which assisted property is sold by a recipient under the Program. The sales price shall equal the price in which the transfer tax is paid except if the buyer assumes existing loans or buys the assisted property subject to existing loans in which case the sales price should equal the principal amount owing on such existing loans plus the price on which the transfer tax is paid.
"Sales proceeds" means the amount of funds received by a recipient under the Program from the sale of assisted property by such recipient as reflected by the sales price minus closing costs, real estate commissions and any other costs incurred by the recipient in selling the assisted property.
"Share" means a proportional interest in a cooperative corporation entitling the holder to reside in a converted rental unit or mobilehome park owned or leased by the cooperative corporation.
"Site control" includes actual ownership of a site, the right to purchase a site under a contract to purchase or option agreement, or such other control of ownership or possession of site as the Department considers satisfactory.
"State contract" means a contract between the Department and governmental agency as provided in subdivision (b) of Section 7914.


Note: Authority cited: Sections 50406, 50776, and 50777, Health and Safety Code. Reference: Sections 50775, 50776, 50777 and 50778, Health and Safety Code.








s 7904. Eligible Use of Funds.
The Department shall provide financial assistance from the Fund, either directly or through a mortgage lender, to enable eligible recipients to purchase or develop property as provided in this section.
(a) Financial assistance may be used for the following purposes:
(1) to enable an eligible household, which has occupied for at least 120 days prior to the date of submission of an application under Section 7916 a rental unit being converted, to purchase the unit it has occupied or another rental unit in the same rental housing development being converted, provided that such other rental unit is not being purchased by its occupant(s), or to purchase a share in a cooperative corporation which entitles the holder to occupy a converted rental unit;
(2) to enable an eligible household to purchase a mobilehome affixed to a permanent foundation, not located or to be located in a mobilehome park;
(3) to enable, on an interim basis, a nonprofit corporation to develop or purchase a mobilehome park where, within a reasonable time thereafter, ownership of the mobilehome park will have been transferred to it occupants, either as individual owners or a shareholders in a cooperative corporation which owns the mobilehome park or;
(4) to enable an eligible household to purchase a share in a cooperative corporation which entitles the holder to reside in a mobilehome park.
(b) In no event shall financial assistance provided under the Program exceed forty- nine (49) percent of the purchase price of the property. The remaining fifty-one (51) percent of the purchase price shall consist of a loan secured by the recipient through a mortgage lender certified under the Program and any required downpayment. With regard to the purchase or development of a mobilehome park, financial assistance shall not exceed forty-nine (49) percent of the purchase price or development costs which can be attributed to the number or ratio of eligible households who will occupy the park.
(c) Where State financial assistance will be used in conjunction with a Federal housing assistance program and a conflict exist between State and Federal program requirements, the requirements of the State Homeownership Assistance Program regulations may be waived only to the extent necessary to permit Federal participation, provided that such a waiver does not conflict with any State legal requirements.
(d) The Department may require that a specified percentage of the total units in a proposed development be pre-sold without state financial assistance at prices at least equal to the prices of units to be purchased with state financial assistance.
(e) Not less than fifty (50) percent of the monies in the Fund shall be used to assist lower income households as defined in Title 25, California Administrative Code, Section 6928.
(f) Not less than twenty (20) percent of the dwelling units assisted under this Program shall be located in rural areas.


Note: Authority cited: Sections 50406, 50775, 50777, and 50778 Health and Safety Code. Reference: Sections 50775, 50776, 50777, and 50778, Health and Safety Code.








s 7906. Eligible Applicants.
Governmental agencies may apply to the Department for a funding commitment under the Program on behalf of eligible households and nonprofit or stock cooperative corporations. To be eligible for a funding commitment under the Program, a governmental agency must meet the following criteria:
(a) It must be certified by the Department as an eligible participant in accordance with Section 7910.
(b) The city and/or county having jurisdiction over the area in which assistance is proposed to be provided, must:
(1) have an adopted housing element which is in conformance with Section 65302 (c) of the Government Code; or
(2) been granted an extension to prepare a Housing Element by the Office of Planning and Research pursuant to Government Code Section 65302.6 prior to approval of the application; or
(3) the Department must make a finding that there exists in the region a severe housing shortage for low and moderate income households, and notwithstanding the locality's failure to comply with state housing element requirements, there exists such an overriding need for the proposed housing assistance that state funding is justified.
Where the housing development for which assistance is proposed is a subdivision under the State Subdivision Map Act, the requirements of this Act, including Government Code Section 66473.5, shall be met.
(c) Unless the governmental agency is an exempt governing body of an Indian reservation or rancheria, the governmental agency must agree to implement a program of assistance to eligible recipients in accordance with Section 7912 which serves to implement the local housing element and Housing Assistance Plan. With respect to assistance programs involving converted rental units, such programs must in addition be part of a comprehensive approach by such agency to the problem of rental unit conversion in the agency's jurisdiction.
(d) It must agree to execute a contract with the Department as provided in Section 7914.


Note: Authority cited: Section 50406, Health and Safety Code. Reference: Sections 50775, 50776 and 50777, Health and Safety Code.








s 7908. Need for Assistance.
A household shall not be eligible under the Program unless it has been determined that such household will be unable to acquire the property without financial assistance from the Fund.
(a) A household shall be determined to be unable to acquire property without financial assistance under the Program if:
(1) the monthly housing cost associated with the property to be purchased would exceed thirty-five (35) percent of the household's income; and
(2) the household's assets do not exceed the total of the following:
(A) the amount necessary to pay the estimated closing cost and downpayment for the property to be purchased;
(B) the amount necessary to pay six (6) months of the monthly housing costs associated with the unit to be purchased; and
(C) five thousand dollars (5,000).
(b) For the purposes of the Program, "assets" means the value of a household's savings and any equity in stocks, bonds, real property, or other forms of capital investment. "Assets" does not include items reasonably necessary for the personal use of the household, such as personal effects, furniture, appliances, automobiles, real or personal property used in a business or undertaking which is a primary sources of livelihood for such household, and a mobilehome to be located on property for which financial assistance will be provided.


Note: Authority cited: Section 50406, Health and Safety Code. Reference: Sections 50775 and 50777, Health and Safety Code.








s 7910. Certification of Program Participants.
(a) Before the Department enters into any contract with, or makes any payment to a governmental agency or a mortgage lender, the Department shall certify upon receipt of a proposal and application for assistance that such agency or lender is capable of fulfilling its responsibilities with respect to the Program and such contract or payment.
(b) In determining the capability of a governmental agency under this section, the Department shall consider whether such agency is:

(1) administratively responsible, as evidenced by the experience of such agency, or the administrative responsibility of staff or consultants employed or to be employed by such agency, in implementing housing rehabilitation, rental assistance, homeownership assistance or other related housing assistance programs; and
(2) capable of proceeding promptly to carry out a program of assistance in accordance with this subchapter.
(c) In determining the capability of a mortgage lender under this section, the Department shall consider:
(1) whether such lender is able to, and has undertaken to, originate, process, close and service loans for the purchase or development (if appropriate) of property; and
(2) whether such lender is:
(A) an approved seller and servicer of conventional loans for the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation,

(B) a mortgagee approved by the Federal Housing Administration or the United State Veterans Administration, or
(C) a lender approved by the California Housing Finance Agency.
(d) At the time a governmental agency applies to the Department for financial assistance under the Program for the benefit of a stock cooperative or nonprofit corporation, the Department shall certify that the corporation has the administrative and financial capability to develop, own or lease, and manage (when applicable) a mobilehome park in accordance with this subchapter. In making its certification the Department shall consider the following:
(1) the experience of the cooperative or nonprofit corporation, or staff or consultants employed or to be employed by such a cooperative or nonprofit corporation, in the design, construction or development, and management (when applicable) of publicly- assisted or non-assisted mobilehome park developments, or rental or cooperatively-owned housing developments; and
(2) whether the cooperative or nonprofit corporation possesses sufficient funds, liquid assets or the ability to borrow, to provide adequately for the predevelopment costs of the proposed mobilehome park and for unforeseen or contingent expenses.


Note: Authority cited: Sections 50406, and 50776, Health and Safety Code. Reference: Sections 50775, 50776 and 50777, Health and Safety Code.








s 7912. Program of Assistance.
A program of assistance to eligible recipients shall be implemented by participating governmental agencies.
(a) The program of assistance to eligible households shall contain the following elements applicable to the type of assistance being provided:
(1) where assistance is provided pursuant to Section 7904 (a) (1), notification to tenants in the rental housing development being converted that financial assistance under this program is available, regardless of race, sex, marital status, color, religion, national origin or ancestry;
(2) where assistance is provided pursuant to Section 7904 (a) (2) and (4), notification to eligible households as provided under Section 7934 that financial assistance under this Program is available, regardless of race, sex, marital status, color religion, national origin or ancestry;
(3) provision of counseling and training to prospective purchasers regarding their rights and responsibilities as homeowners including budgeting for mortgage payments and related housing costs;
(4) notification to eligible households of the names and locations of mortgage lenders certified to make loans in conjunction with the state under the Programs;
(5) assistance to eligible households in making applications for loans.
(b) The program of assistance to stock cooperatives or nonprofit corporations purchasing or developing mobilehome parks shall contain the following elements:

(1) development and implementation of an affirmative marketing plan in accordance with Section 7934 and approved by the Department for occupancy of the mobilehome park by eligible households;
(2) ensure compliance with relevant state and federal laws including CEQA; and
(3) where the city and/or county having jurisdiction over the area in which the mobilehome park is to be developed or purchased has assumed responsibility for enforcement of the Mobilehome Parks Act in accordance with Section 18300 of the Code, assurances that the city and/or county will:
(A) review, approve and submit to the Department for review and approval, all preliminary plans submitted by stock cooperative or nonprofit corporation in its application for a permit to construct, ensuring compliance with the Mobilehome parks Act, Title 25, California Administrative Code, Sections 1000 et seq. , and all relevant local planning, health, utility and fire requirements; and
(B) issue all appropriate permits required by the Mobilehome Parks Act after receipt of Department approval as provided in the preceding subdivision.

(c) The program of assistance shall include such other activities deemed necessary by the Department to ensure that the objectives and requirements of the Program are fulfilled.


Note: Authority cited: Section 50406, Health and Safety Code. Reference: Sections 50775, 50776 and 50777, Health and Safety Code.








s 7914. Contracts and Agreements.
(a) All financial assistance provided by the Department shall be governed by contracts binding all recipients of such financial assistance as provided in this section. The Department may require such additional contracts, agreements, or amendments thereto, as it deems necessary to meet the purposes of the Program or requirements of the Code.
(b) Whenever the Department makes a funding commitment to a governmental agency applying for assistance on behalf of eligible recipients, the commitment of funds shall be governed by a state contract between the Department and the governmental agency. The state contract shall contain such terms and conditions as the Department considers necessary for the purposes of the Program and to meet the requirements of the Code, including but not limited to:
(1) a provision specifying the maximum amount of funds committed and the duration of the commitment by the Department to a governmental agency for the purpose of providing financial assistance to eligible recipients;
(2) a provision specifying the proposed sources, terms and conditions of public or private financing to be used in combination with funds from the Program;
(3) a description of the specific location of the housing development(s) in which the properties to be assisted are located;
(4) a provision specifying the minimum number of households to be assisted, including the minimum number of such households which are of lower income;
(5) a provision specifying that the maximum amount of assistance to be provided to eligible households or nonprofit corporations shall not exceed the amount provided in Section 7904(b);

(6) a description of the program of assistance to be provided by the governmental agency to eligible recipients which will receive financial assistance under the Program;
(7) a provision specifying the terms and conditions relating to breach of the state contract or this subchapter by the governmental agency; and
(8) a provision for periodic progress reports to the Department relating to implementation of the Program.
(c) Where financial assistance is provided to eligible households pursuant to Section 7904 (a) (1),(2) or (4), such assistance shall be provided either directly or indirectly by the Department in the form of a loan to such households. State loans shall be made in conjunction with loans made by a certified mortgage lender. During the term of its loan, the mortgage lender shall be repaid in monthly or periodic installments while repayment of the State's loan shall be deferred until the time of sale or transfer of the property or until repayment is required due to loss of eligibility. The purchaser shall execute a promissory note and deed of trust securing the State's loan. The form and content of the note and deed of trust utilized may vary provided that the State's loan is adequately secured and the following provisions are included;
(1) a description of the property being purchased;
(2) a provision requiring the purchaser to repay to the Department upon sale or transfer of the assisted property an amount of the sales proceeds of the assisted property proportionate to the percentage of the original purchase price contributed by the Department, incorporating any adjustments for improvements or partial repayments in accordance with Sections 7926 and 7928;
(3) a provision specifying that the assisted property shall not be sold for an amount substantially below its fair market value for the purpose of reducing the state's share in the sale proceeds;
(4) a provision for voluntary repayment to the Department of the total amount which would be owed to the Department if the property were sold at fair market value pursuant to Section 7930 at the time of such repayment;
(5) a provision allowing the purchaser to increase its equity in the assisted property by paying the Department less than the full amount owed to the state, as provided in Section 7928;
(6) provisions requiring the purchaser to:
(A) occupy the assisted property as its principal place of residence and not use such property as rental property during the term of the loan;
(B) pay all property and other taxes, fees and impounds levied with respect to the property;
(C) keep the property insured against fire;
(D) maintain the property in good condition; and
(E) comply with all terms and conditions of, and make all payments required by the promissory note and deed of trust;
(7) a provision requiring prior Department approval of any improvement to be made to the assisted property by the purchaser when a readjustment pursuant to Section 7926 will be sought;

(8) a provision prohibiting the purchaser from further encumbering the property with liens or deeds of trust without the express prior written approval of the Department;
(9) a provision requiring repayment or partial repayment to the Department if such repayment is determined to be necessary in accordance with Section 7936;
(10) a provision specifying that if the purchaser breaches any covenant or condition of the promissory note or deed of trust, a demand may be made for repayment of the full amount to the State would be entitled if the property were sold at fair market value and that, in the event of non-repayment, non-judicial foreclosure may be pursued;
(11) a provision specifying that if non-judicial foreclosure is pursued as a result of an alleged breach of the promissory note or deed of trust by the purchaser, the purchaser shall be notified of his/her right to dispute the alleged breach in a hearing before the Department as provided in Section 7938.
(d) Where financial assistance under the Program is provided to stock cooperatives or nonprofit corporations pursuant to Section 7904 (a) (3), the recipient shall execute a promissory note and deed of trust securing the State's loan. The form and content of the note and deed of trust utilized may vary provided that the State's loan is adequately secure, and the following provisions are contained in the note or deed of trust or in a contract prescribed by the State:
(1) the provisions required by subdivisions (c)(1) through (c)(11) inclusive of this section, except subdivisions (c)(2),(c)(6)(A), and (c)(9);
(2) a provision specifying that state funds shall not be released until a permanent financing commitment has been secured by the recipient corporation. In no event shall the period of interim financing exceed two (2) years where a park is to be developed or one (1) year where a park is to be purchased;
(3) a provision requiring that if during the period of interim financing the nonprofit or cooperative corporation intends to charge space rent to eligible households to be assisted under the Program, that such rent when added to other monthly housing costs not exceed thirty-five (35) percent of the eligible household's gross income or that such rent not exceed the space rent existing prior to the purchase of the mobilehome park with assistance under the Program, whichever is less;

(4) a provision requiring the recipient corporation to repay to the Department at the time permanent financing is secured, or upon sale or transfer of the property, whichever occurs first, an amount proportionate to the percentage of the development costs or purchase price provided by the Department, incorporating any adjustments for improvements, in accordance with Section 7926;
(5) where a mobilehome park is to be developed, provisions which require, pursuant to state or federal law the use of affirmative action in hiring by all contractors and subcontractors involved in the construction of a mobilehome park, and that the park will be developed in accordance with the Mobilehome Parks Act, Title 25, California Administrative Code Section 1000 et seq.;
(6) a provision requiring that ownership of the park be transfered to a cooperative corporation with shareholders who will occupy the park or to individual owners who will occupy the park, at the termination of interim financing;
(7) a provision specifying the number of eligible households, including lower income households, which will occupy the mobilehome park for the purpose of determining the amount of assistance to be provided to the nonprofit or cooperative corporation;
(8) a provision requiring compliance by the cooperative or nonprofit corporation with an approved affirmative marketing plan as provided in Section 7934;
(9) a provision requiring the recipient corporation to pay reasonable actual moving expenses of households displaced as a result of the development of a mobilehome park using financial assistance under the Program. Only those displaced persons who occupied their dwelling at the time an application was submitted to the Department in accordance with Section 7916 shall be eligible for moving expense payments;
(e) Notwithstanding subdivisions (c) (2) and (d) (4) of this section, the promissory note and deed of trust may require that the Department not receive in repayment less than the amount of assistance originally provided.
(f) All promissory notes and deeds of trust shall be recorded in the office of the county recorder in which the assisted property is located.
(g) The Department shall enter into agreement(s) with the entity or entities that will originate and service State loans under the Program. The agreement(s) shall include but not limited to the following:
(1) a provision requiring Department approval prior to the close of escrow of each purchaser's loan application and other loan documents required by the Department;
(2) a provision requiring prior Department approval of the eligibility of improvements for reimbursement pursuant to Section 7926;
(3) a provision requiring prior Department approval before a recipient of funds may further encumber assisted property with liens or deeds of trust, other than those securing a loan under the Program;
(4) a provision requiring determination of the value of claimed improvements by a servicer of the state loans as provided in Section 7926;
(5) a provision requiring a loan servicer to make all necessary readjustments for improvements and partial repayments in accordance with Sections 7926 and 7928 and to maintain a record of any such readjustment and forward copies to the Department and the governmental agency;

(6) a provision requiring a loan servicer to periodically recertify the eligibility of the purchaser and to secure repayment on behalf of the Department as required by Section 7936;
(7) a provision requiring a loan servicer to notify the Department in writing in the event that it becomes aware of a default by a recipient in the performance of its obligations under this Section; and
(8) a provision requiring a loan servicer to secure repayment on behalf of the Department when assisted property is sold and to ensure that the assisted property is not sold for an amount substantially below its fair market value for the purpose of reducing the state's share in the sale proceeds.


Note: Authority cited: Section 50406, Health and Safety Code. Reference: Sections 50775, 50776, 50777, Health and Safety Code.








s 7916. Contents of Applications.
(a) Applications shall be made by governmental agencies in accordance with a form to be issued by the Department which shall require at least the following information:
(1) evidence of the eligibility of the applicant under Section 7906;
(2) a description of the proposed uses of financial assistance under the Program, indicating the eligibility of structures under Section 7904;

(3) details of the program of assistance to be provided;
(4) the anticipated sales prices of the properties to be assisted under the Program;
(5) the amount of financial assistance needed;
(6) the number of households that may be displaced as a result of the project; and
(7) the status of the local jurisdiction's housing element in terms of conformity Section 65302 (c) of the Government Code.
(b) Applications for financial assistance under Section 7904 (a) (1), (2) and (4) shall include information required in subdivision (a) above and the following additional information:
(1) details of services or financing to be provided by the governmental agency and any mortgage lender;

(2) a description of housing developments in which eligible households reside or are to reside; and
(3) a statement indicating how the assistance program forms a part of the governmental agency's comprehensive approach to rental unit conversion or a part of its comprehensive housing strategy.
(c) Applications for financial assistance to purchase shares in a cooperative corporation shall include the information required by subdivisions (a) and (b) above and the following additional information:
(1) the articles of incorporation and by-laws of the cooperative corporation in which shares are proposed to be purchased;
(2) evidence of the market value of such share; and
(3) a description of rights and liabilities attaching to such shares, including but not limited to, any additional amounts required to be paid by the holder for the right to reside in the development or mobilehome park.
(d) Applications for financial assistance to purchase a mobilehome park under Section 7940 (a) (3) shall include information required in subdivision (a) above and the following additional information:
(1) identification and description of the mobilehome park proposed to be purchased;
(2) financial aspects of the mobilehome park, including sales price of the park, the presence of any occupied structure other than a mobilehome on the site, sources and terms of financing, projected operating expenses and utility costs;
(3) marketability of spaces in the mobilehome park, including evidence of the existing tenant's intentions to purchase their spaces, existing and projected occupancy of the mobilehome park and details of the plan for affirmative marketing if appropriate; and
(4) planning aspects of the mobilehome park, including conformity with the local General Plan, including the housing element, Housing Assistance Plan, local growth policy, appropriate zoning requirements, and access to public utilities.
(e) Application for financial assistance to develop a mobilehome park under Section 7904 (a) (3) shall consist of a pre-application and final application by the local governmental agency and shall be submitted to the Department in accordance with Department instructions.
(1) the pre-application shall include the information contained in subdivision (a) above and the following additional information:
(A) evidence of the administrative and financial capability of the non-profit or stock cooperative corporation pursuant to Section 7910 (d);
(B) identification and description of the mobilehome park proposed to be developed;
(C) a site map indicating the location of the proposed assisted and non-assisted spaces;
(D) preliminary drawings of the assisted and non-assisted spaces;
(E) information as to the financial aspects of the mobilehome park, including evidence of site control, the presence of any occupied structure on the site, a general breakdown of development costs, anticipated sources and terms of financing, projected operating expenses and projected utility costs;
(F) information as to the proposed construction of the mobilehome park development, including the general contractor's name and experience, method of construction and any special design features;
(G) information as to the marketability of spaces in the mobilehome park, including area housing needs and income levels, regional and local vacancy rates, projected occupancy of the mobilehome park and details of the plan for affirmative marketing;
(H) information as to the planning aspects of the mobilehome park, including anticipated or actual conformity with the local growth policy, and appropriate zoning requirements; and
(1) information as to access to utilities, services and employment.
(2) The final application for financial assistance shall include the following information:

(A) a construction timetable and incorporation of affirmative action requirements;
(B) a set of architectural drawings; and
(C) information as to the actual sources and terms of financing.
(f) Applicants for activities which are subject to CEQA, will act as Lead Agency and will prepare necessary environmental documents for the project. Applicants will provide the Department with assurances that the provisions of CEQA, where applicable, have been or will be complied with.
(g) Guidelines and instructions under this section shall require the applicant to provide such other information as the Department may consider necessary to meet the purposes of the Program of the requirements of the Code.


Note: Authority cited: Section 50406, Health and Safety Code. Reference: Sections 50775, 50776, and 50777, Health and Safety Code.








s 7918. Staff Review of Applications.
(a) Program staff shall review all applications by governmental agencies to determine the eligibility of such governmental agencies and the economic feasibility, desirability and appropriateness of the proposed uses for assistance.
(b) In conducting its review, program staff shall consider:
(1) the capability of the governmental agency, mortgage lender and the cooperative or nonprofit corporation, if any, to implement the requirements of the Program;
(2) local efforts to adopt and implement the housing element of the General Plan of the local jurisdiction for which the assistance program is proposed in accordance with Section 65302(c) of the government Code, if applicable, and the conformity of the application with such housing element;
(3) the governmental agency's program of assistance and comprehensive housing strategy;
(4) whether the proposed project will result in the displacement of low and moderate income households as defined in Section 6912 of Title 25, California Administrative Code;
(5) whether the proposal for assistance will result in a timely and efficient use of available funds;
(6) the percentage of funds proposed to be used to assist lower income households in accordance with Section 7904(c);

(7) the local priorities for allocating financial assistance among eligible households;
(8) whether, and how much, additional public and private resources will be used in conjunction with assistance under the Program;
(9) the geographic distribution of assisted units in accordance with Section 7904(d);
(10) compliance with other requirements of this subchapter; and
(11) other criteria deemed necessary by the Department to ensure that the objectives of the Program are fulfilled.
(c) On the basis of its review of the applications, program staff will prepare recommendations for each application and submit them to the Committee for its consideration and decision. When an application is submitted to the Committee for review, the applicant shall be notified of the recommendation and date and time of the Committee hearing.
(d) Where a pre-application has been submitted to the Department for financial assistance to develop a mobilehome park, program staff will review such pre-applications to determine if they are complete, accurate and generally in compliance with this subchapter and to determine their eligibility and the appropriateness of providing assistance from the Fund in accordance with subdivision (b) of this section.
(1) On the basis of its review of the pre-application, program staff will prepare recommendations for each pre-application and submit them to the Committee for its consideration and decision as to preliminary commitment.
(2) When a pre-application is submitted to the Committee for review, the applicant shall be notified of the recommendation and the date and time of the Committee hearing considering the pre-application.
(3) After preliminary commitment, the staff shall review the final application to determine compliance with all preliminary commitment conditions. Material noncompliance with any condition, lack of progress in fulfilling conditions, and other material facts shall be reported to the Committee.


Note: Authority cited: Section 50406, Health and Safety Code. Reference: Sections 50775, 50776 and 50777, Health and Safety Code.








s 7920. Committee Review of Applications and Other Matters.
(a) The Committee shall be responsible for the review and disposition of all applications for financial assistance by governmental agencies. It shall adopt operating policies and procedures for the program, and shall perform other functions and duties as may be required by the Director of the Department or by law.
(b) the Committee shall consist of members and shall operate as set forth in subchapter 1 (commencing with Section 6900) of Chapter 6.5 of Part 1 of Title 25, California Administrative Code.
(c) In taking any action, the Committee shall consider the recommendations of program staff, the application and any written or oral testimony of an applicant or other interested person.
(d) Approval or denial of any action by a loan committee shall constitute a recommendation to the Director who shall consider the committee's recommendation in making a decision on the action.
(e) The Committee shall base its final recommendation as to each application or any other action pursuant to the subchapter on the criteria contained in Section 7918(b) and such other considerations as are consistent with the terms and objectives of the Program.
(f) The Committee shall within fifteen (15) days of the date on which it considers any request for action, inform the applicant in writing of its recommendation stating:
(1) that it has approved, postponed consideration of, or rejected the request or application:

(2) the reasons for refusal or postponement of consideration; and
(3) that the applicant or recipient has a right of appeal as specified in Section 7922.
(g) The Committee, in any recommended approval of a pre-application, shall specify any terms, conditions or special requirements which are not present in the pre-application, as well as the form, term and timing of assistance. The recommended approval shall include a commitment of funds for a sum of no more than one hundred ten percent (110%) of the amount of assistance approved for the specific project.
(h) The Committee shall specify in any recommended approval of an application:
(1) the amount and purpose of financial assistance to be provided to the applicant and minimum number of households to benefit from such assistance;
(2) the form, terms and timing of such financial assistance; and
(3) any conditions attached to the approval of its application.


Note: Authority cited: Section 50406, Health and Safety Code. Reference: Sections 50775, 50776 and 50777, Health and Safety Code.








s 7922. Appeals.
(a) If an applicant or recipient is dissatisfied with:
(1) the refusal or postponement of consideration of the application or any other matter pursuant to this subchapter,
(2) a reduction of the amount applied for, or
(3) any conditions attached to the recommended approval of the application or any other matter pursuant to this subchapter, it may within thirty (30) days of the date of the Committee's decision appeal in writing to the Director of the Department, stating and fully supporting the grounds of its appeal.
(b) If an applicant or recipient appeals to the Director pursuant to subsection (a) of this section, the Director shall:
(1) within thirty (30) days of the date of documented receipt of the appeal hold an open informal meeting at which the applicant, recipient, program staff and any interested person may make submissions as to the action the Department should take with respect to the application or matter being considered; and
(2) within forty-five (45) days of the date of documented receipt of the appeal notify the applicant or recipient in writing of the Director's determination of the appeal.
(c) The director's determination of the appeal shall be final.


Note: Authority cited: Section 50406, Health and Safety Code. Reference: Sections 50775, 50776 and 50777, Health and Safety Code.








s 7924. Amount of Assistance.
(a) the amount of financial assistance to be provided to an eligible household shall be determined in the following manner:
(1) The eligible household shall contribute at least thirty-five (35) percent of its gross monthly income to monthly housing cost in connection with the purchase of assisted property.
(2) An eligible household may be allowed to assume a greater responsibility for monthly housing costs if:
(A) the proposed housing costs are approximately the same as the present housing costs of the household,
(B) a satisfactory credit record has been maintained by the household, and
(C) the household has demonstrated an ability sustain its present housing expense without serious difficulty; or
(D) it has been otherwise determined that the eligible household can assume such greater responsibility.
(3) The eligible household shall contribute at least three (3) percent of the purchase price of the assisted property as a downpayment.
(4) At the time the household applies to a mortgage lender originating State loans under the Program, such lender shall determine, using its normal underwriting standards and the provisions of this section, the minimum amount of state financial assistance necessary to qualify the household for a mortgage loan.

(5) In no event shall the amount of financial assistance provided to an eligible household under the Program exceed forty-nine (49) percent of the purchase price or appraised value of the assisted property, whichever is less.
(b) Where financial assistance is being provided to a nonprofit corporation for purchase or development of a mobilehome park, the amount of assistance to be provided shall be based on the costs directly attributable to the number or ratio of eligible households who will occupy the park. The amount of financial assistance shall be determined in the following manner:
(1) The nonprofit corporation shall be eligible to receive financial assistance in an amount equal to either forty-nine (49) percent of the costs attributable to the development of the spaces to be occupied by eligible households or forty-nine (49) percent of the purchase price attributable to the purchase of spaces to be occupied by eligible households.


Note: Authority cited: Section 50406, Health and Safety Code. Reference: Sections 50755, 50776 and 50777, Health and Safety Code.










s 7926. Improvements.
(a) The recipient must obtain approval by the Department as to the eligibility of contemplated improvements prior to initiating such improvements.
(b) The value of improvements to assisted property shall be determined at the time such improvements are made, in the following manner:
(1) Where improvements are made which increase the value of the property, the value of such improvements shall be the amount, if any, by which the value of the property after the improvements are made exceeds the value of the property before the improvements are made,
(A) less the amount, if any, by which the value of the property has been increased by other work not constituting improvements performed between the two valuations, and
(B) plus the cost to the recipient of the appraisals to determine the value of the property before and after the improvements were made in accordance with this section.
The improvements adjustment to be made to the purchase price under Section 7914(c) (4) and (d) (5) shall be calculated in accordance with the following formula:




E = (V 1 x E 1) + I
-------------------
V 1 + I


E is the proportion of the value to which the householdis entitled after improvements V 1 is the value of the property immediately before the improvements are made I is the value of the improvements (in accordance with subdivisions (1) of this section) E 1 is the proportion of the value of the property to which the household is entitled immediately before the improvements were made (continued)