Cal. Civ. Code § 0770-03-02-.06

(1) Notification of Completion.

(a) The Owner must notify the Agency when the work is completed and submit to the Agency the
evidence of completion and certifications described in Rule 0770-3-2-.06(2) and (3).

(2) Evidence of Completion.

(a) Completion of the unit(s) must be evidenced by furnishing the Agency with the following:

1. A certificate of occupancy and/or other official approvals as required by the locality.

2. A certification by the Owner that:

(i) The unit(s) has been completed in accordance with the requirement of the
Agreement-,

(ii) The unit(s) is in good and tenantable conditions;

(iii) The unit(s) has been rehabilitated in accordance with the applicable zoning,
building, housing and other codes, ordinances or regulations, as modified by any
waivers obtained from the appropriate officials;

(iv) Any unit(s) built prior to 1950 is in compliance with applicable HUD Lead Based
Paint regulations (24 CFR Part 35);

(v) If applicable, the Owner has complied with the provisions of the Agreement
relating to the payment of not less than prevailing wage rates and that to the best of
the Owner’s knowledge and belief there are no claims of underpayment concerning
alleged violations of said provisions of the Agreement. In the event there are any
such pending claims to the knowledge of the Owner or Agency, the Owner will be
required to place a sufficient amount in escrow, as determined by the Agency, to
assure each payments; and

(vi) If there are units in the budding which will not be assisted under the Program, the
units comply with the Housing Quality Standards specified in Section 0770-3-1-
.04.

(vii) Notice of Completion has been properly filed in the appropriate county register of
deeds office.

(3) Actual Cost and Rehabilitation Loan Certifications.

(a) The Owner must provide the Agency with a certification of the costs incurred for the
rehabilitation and any temporary relocation as well as the interest rate and term (if the total cost
of rehabilitation under the Agreement is less than $15,000) of any rehabilitation loan. The
Owner must certify that these are the actual costs, interest rate, and term (where applicable). The
Agency must review for completeness and accuracy and accept these certifications subject to the
right of post audit. The Agency must then establish the Contract Rents which will be subject to
reduction based on a post audit.

(4) Review and Inspections.

(a) Within ten working days of the receipt of the evidence of completion, the Agency must review
the evidence of completion for compliance with paragraph (b) of this section.

(b) Within the same time period, an Agency representative must inspect the unit(s) to be assisted to
determine that the unit(s) has been completed in accordance with the Agreement and meets the
Housing Quality Standards or other standards approved by HUD for the Program. If the
inspection discloses defects or deficiencies, the inspector must report these in detail.

(5) Acceptance.

(a) If the Agency determines from the review and inspection that the unit(s) has been completed in
accordance with the Agreement, the Unit(s) will be accepted.

(b) If there are any items of delayed completion which are minor items or which are incomplete
because of weather conditions, and in any case which do not preclude or affect occupancy, and
all other requirements of the Agreement have been met, the unit(s) may be accepted. An escrow
fund determined by the Agency to be sufficient to assure completion for items of delayed
completion will be required, as well as a written agreement between the Agency and the Owner,
to be included as an exhibit to the Contract, specifying the schedule for completion. If the items
are not completed within the agreed time period, the Agency may terminate the Contract or
exercise other rights under the Contract.

(c) If other deficiencies exist, the Agency must determine whether and to what extend the
deficiencies are correctable, and whether the Contract Rents should be reduced. The Owner must
be notified of the Agency’s decision. If the corrections required by the Agency are possible, the
Agency and the Owner must enter into an agreement for the correction of the deficiencies within
a specified time. If the deficiencies are corrected within the agreed period of time, the Agency
will accept the unit(s).

(d) Otherwise, the unit(s) may not be accepted, and the Owner must be notified with a statement of
the reasons for nonacceptance.

Authority: T.C.A. §13-23-115(18). Administrative History: Original rule filed July 13, 1982; effective August 12,
1982.