OAR 813-110-0013: Loan Requirements

To be eligible for the OAHTC program tax credit, the permanent loan shall be: (1) Made to a qualified borrower who; (a) Uses the proceeds to finance construction, development, acquisition, or rehabilitation of housing; and, (b) Provides a written declaration to OHCS that: (A) Housing created by the loan is or will be occupied by households earning 80 percent or less of the area median income; and, (B) The full amount of the savings, from the reduced interest rate provided by the lending institution, is or will be passed through to the qualified tenants in the form of a rent reduction or housing payment reduction, regardless of other subsidies provided directly to the housing project, (C) In satisfying the pass-through requirement in OAR 813-110-0013(B), project sponsors may not assign pass-through to units whose qualified tenants are benefitting from project-based rent assistance, (D) In satisfying the pass-through requirement in OAR 813-110-0013(B), may not assign more than the estimated prorated annual per unit pass-through to units whose qualified tenants benefit from a tenant-based voucher. (E) Limited Equity Cooperative projects satisfy the pass-through requirement in OAR 813-110-0013(B) by passing through the full amount of the savings to households in the Limited Equity Cooperative in the form of reduced housing payments, (F) The estimated annual average per-unit pass-through for a project is to be calculated by taking the total loan interest savings over the term of the OAHTC, divided by the term, then divided by twelve months, and then divided by the number of eligible affordable units occupied or held vacant for occupancy by qualified tenants, or (2) Made to a qualified borrower who ensures; (a) The proceeds will be used to finance construction, development, acquisition, or acquisition and rehabilitation of housing consisting of a manufactured dwelling park; (b) The housing created by the loan is or will be occupied by a significant number of households, defined as 60% or more of all households at initial tenant qualification, earning 80 percent or less of the area median income; and, (c) Provides by a written declaration to OHCS that the housing will continue to be operated as a manufactured dwelling park during the period for which the OAHTC program tax credit is allowed, or\ (3) Made to a qualified borrower who; (a) Uses the proceeds to finance acquisition, or acquisition and rehabilitation, of housing consisting of a preservation project; and, (b) Provides a written declaration to OHCS that the housing preserved by the loan: (A) Is or will be occupied by households earning 80 percent or less of the area median income; and (B) Has a rent assistance contract with the United States Department of Housing and Urban Development (HUD) or the United States Department of Agriculture that will be maintained by the qualified borrower, or; (4) Made to qualified borrower who; (a) Uses the proceeds to finance preservation activities including construction, development, acquisition, or rehabilitation, of housing; and, (b) Enters into a written declaration of restricted covenants with OHCS including the following minimum written requirements and any other that OHCS deems necessary: (A) The housing is or will be occupied by households earning 80 percent or less of the area median income, and (B) Is the subject of a rent assistance contract with the federal government or the state government or a local government that will be maintained by the qualified borrower, and (C) That limits a tenant's rent burden to no more than 30 percent of their income, and (D) Has the declaration recorded (5) Made to a qualified borrower who; (a) Uses the loan proceeds to finance preservation or rehabilitation of housing; and, (b) Provides a written declaration to OHCS that the housing preserved or rehabilitated by the loan: (A) Is or will be occupied by households earning 80 percent or less of the area median income; and (B) Is determined by OHCS through an internal review process as laid out in the Property Stabilization Investments guidance available on OHCS’s website to be in financial or physical distress that threatens its ongoing viability as an affordable housing resource. (C) The OAHTC Program Manual referenced in OAR 813-110-0011 details specific parameters OHCS will use to make determinations of financial or physical risk. (6) Made to a qualified mortgage loan fund that: (a) Uses the proceeds to finance mortgages on land trust homes, and, (b) Confirms that the homes will be affordable and occupied by first-time homebuyers that at the time of mortgage origination have a household income of 80 percent or less of area median income. (7) For the project to qualify under OAR 813-110-0013 (3) and (4), a minimum of 25 percent of the total units must be covered by qualifying rent assistance contracts.