(a) Loan Term and Repayment. The MOHCD Director shall prepare Loan documents consistent with the Program Regulations. So long as the applicable Property continues to be used for Cooperative Living, the Loan documents may allow payment from net cash flow, defer some or all payments during the term, and allow for debt forgiveness at the end of the term, all as determined by the MOHCD Director.
(b) Security for Loans. The MOHCD Director may require Loans made under this Chapter 117 to be secured by a deed of trust and other security instruments for the benefit of the City consistent with Program Regulations. The MOHCD Director may record and subordinate deeds of trust and other security instruments as needed or appropriate to achieve and preserve Cooperative Living.
(c) Declaration of Restrictions. Any Loan shall be subject to a Declaration of Restrictions with the longest possible term as determined by the MOHCD Director, including, but not limited to terms of 55 years or longer or for the life of the applicable building or unit. MOHCD shall not subordinate a Declaration of Restrictions to any third party financing instrument, except to the extent required by federal or state funding sources or financing for the acquisition of Cooperative Living.
(d) Combining Loans. Subject to any applicable requirements of a funding source, MOHCD may issue one or more Loans, in any combination, that the MOHCD Director deems appropriate to fund acquisitions for Cooperative Living. A Borrower shall comply with the requirements of each applicable funding source, which shall be included in the Loan documents.
(e) Purchase Option. To ensure long-term affordability, MOHCD may require Borrowers to execute and record against the Property an agreement that provides the City an option to purchase the Property at a restricted value.
(f) Compliance with Transaction Documents and Applicable Laws. Each Loan agreement shall require Borrowers to comply with applicable laws and regulations, including federal, state, and City regulations and Program Regulations. In addition, MOHCD shall work with the Controller, the City Attorney, and non-City funding sources to monitor compliance with all Loan agreements, Program Regulations, and applicable laws.
(Added by Ord. 163-19, File No. 190573, App. 7/26/2019, Eff. 8/26/2019)