Cal. Civ. Code § 4 CSR 170-4.300

PURPOSE: This rule provides regulatory
control by the Missouri Housing Development
Commission (commission) over approved
mortgagors. It requires approved mortgagors
to furnish reports and financial information,
allows the commission to perform on-site
inspections of developments, and restricts the
ability of approved mortgagors to change
rents or ownership without the consent of the
commission.
(1) All developments financed in whole or in
part by the Missouri Housing Development
Commission (commission) must remain
available to low- and moderate-income persons at the lowest possible costs throughout
the life of the loan, or until such later time as
the commission may require. To help insure
the achievement of these goals, for all developments financed by the commission, the following procedures shall be established to
monitor compliance with the requirements of
the state housing act, these regulations, and
the requirements of any regulatory agreement
or land use restriction agreement governing
the use of the development:
(A) Within ninety (90) days following the
end of each fiscal year, all approved mortgagors operating developments consisting of
twenty-four (24) or more units shall furnish
the commission with a complete annual
financial report based upon an examination of
the books and records of the development
prepared in accordance with the requirements
of the commission by a certified public
accountant or other person acceptable to the
commission and certified by an authorized
agent of the mortgagor. For any development
containing less than twenty-four (24) units,
the commission may, where deemed appropriate to protect the interests of the state of
Missouri, require approved mortgagors of
such developments to provide the commission
with similar annual financial reports;
(B) The staff of the commission shall perform an annual performance audit of each
development unless other applicable federal
or state laws or regulations require more
restrictive audit rules, in which case the more
restrictive rules shall dictate the frequency
with which audits are performed. Notwithstanding the previous sentence, the commission staff may, in the absence of more restrictive federal or state laws or regulations,
perform such audits less frequently than once
per year for developments meeting such criteria as the commission staff may establish
from time-to-time;
(C) The staff of the commission shall perform an annual on-site inspection of each
development unless other applicable federal
or state laws or regulations require more
restrictive inspection rules, in which case the
more restrictive rules shall dictate the frequency with which inspections are performed. Notwithstanding the previous sentence, the commission staff may, in the
absence of more restrictive federal or state
laws or regulations, perform such on-site
inspections less frequently than once per year
for developments meeting such criteria as the
commission staff may establish from time-to-time;
(D) The approved mortgagor for each
development shall, on an annual basis, provide the commission staff with a verification
of income of each of the tenants in its development. This requirement shall apply to all
tenants, regardless of whether they occupy a
market rate unit or a unit for which reduced
affordable housing rents are being charged.
For developments not receiving financing
from the commission, the only initial verification of income for each tenant will be
required unless any other federal or state laws
applicable to the development shall require
more frequent income verification of tenants,
in which case the more restrictive requirements shall prevail; and
(E) Upon the request of the commission,
its agents, employees, or attorneys, approved
mortgagors shall submit monthly occupancy
reports to the commission staff, as well as
give specific answers to questions upon
which information is desired from time-to-time relative to the operation and condition of
any development.
(2) No rents or charges to tenants in any
development financed by the commission
shall be increased without the prior written
approval of the commission staff.
(3) Transfer of Ownership. The basic documents of the commission severely restrict the
transfer of legal or beneficial interest in any
development, and no such transfer may occur
without the prior written consent of the commission. No monies paid for either the legal
or beneficial interest of a development
financed by the commission shall be deemed
to increase the equity for the purposes of
determining allowable distribution of dividends, except for those funds approved as
development costs.
(A) Any intent to utilize secondary financing secured by the development shall be
specifically identified.
(B) The consent of the U.S. Department of
Housing and Urban Development (HUD)
shall not be deemed adequate for commission
approval of transfer of ownership.
(4) The approved mortgagor shall provide the
commission with the following information:
(A) In the case of an individual approved
mortgagor, the name and address of the mortgagor;
(B) In the case of an approved mortgagor
that is a partnership, the names and addresses of all persons or entities having an ownership interest in the partnership; and
(C) In the case of an approved mortgagor
that is a corporation, the names and addresses of the officers, directors, and shareholders
and any amendments or substitutions which
may occur from time-to-time in the organization of the approved mortgagor.
(5) Until the later of i) the repayment of the
commission’s loan on the development, ii)
the expiration of any applicable compliance
period set forth in the commission’s loan documents, or iii) any longer period otherwise
prescribed by the commission, an approved
mortgagor shall notify the commission
regarding any of the following changes:
(A) Any change in the approved mortgagor’s address;
(B) Any change in the management agent
managing the development;
(C) Any amendments or substitutions in
the organization of the approved mortgagor
(which notice shall also be provided to the
management agent of the development); and
(D) Any other events for which notice may
be required under the commission’s loan documents.
AUTHORITY: section 215.030(5), (12), and
(19), RSMo 2000.* Original rule filed May
24, 2010, effective Jan. 30, 2011.
*Original authority: 215.030, RSMo 1969, amended 1974,
1982, 1985, 1989, 1993, 1995, 1998.