(a) Loan Term and Repayment. The Director shall prepare Loan documents consistent with Program Regulations. So long as the applicable Property continues to be used for Affordable Housing, 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 Director.
(b) Security for Loans and Grants. The Director may require Loans or Grants made under this Chapter 120
to be secured by a deed of trust and other security instruments for the benefit of the City consistent with Program Regulations. The Director may record and subordinate deeds of trust and other security instruments as needed or appropriate to achieve and preserve Affordable Housing.
(c) Declaration of Restrictions. Any Loan or Grant for the acquisition, development, construction, rehabilitation, or preservation of Affordable Housing shall be subject to a Declaration of Restrictions with the longest possible term as determined by the Director, including, but not limited to terms of 55 years or longer or for the life of the applicable building. 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 new construction of Affordable Housing.
(d) Combining Loans or Grants. Subject to the applicable requirements of a Fund, Program, or Program Regulations, MOHCD may issue one or more Loans or Grants, in any combination, that the Director deems appropriate to create or preserve Affordable Housing. A Borrower or Grantee shall comply with the requirements of each applicable Program and funding source, which shall be included in the Grant or Loan documents.
(e) Purchase Option. To ensure long-term affordability, MOHCD may require Borrowers and Grantees 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 and Grant agreement shall require Borrowers and Grantees to comply with applicable laws and regulations, including federal, state, and City regulations and Program Requirements. In addition, MOHCD shall work with the Controller, the City Attorney, and non-City funding sources to monitor compliance with all Loan and Grant agreements, Program Regulations, and applicable laws.
(Added by Ord. 202-19, File No. 190679, App. 8/9/2019, Eff. 9/9/2019)