AB 523, as introduced, Ammiano. Department of Housing and Community Development: loans.
Existing law authorizes the Department of Housing and Community Development to make advance payments to eligible borrowers and grantees under certain loan or grant programs for housing, if the department makes specified determinations.
This bill would additionally authorize the department to reduce the interest rate on any loan issued by the department to a rental housing development to as low as 0% if the development meets specified requirements.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 50406.7 is added to the Health and Safety
2Code, to read:
Notwithstanding any other law, the department may
4reduce the interest rate on any loan issued by the department to a
P2 1rental housing development to as low as 0 percent if the
2development meets all of the following requirements:
3(a) The development has no other debt with regularly scheduled
4or amortizing debt service payments.
5(b) The development will utilize low-income housing tax credits.
6(c) The sponsor provides evidence acceptable to the department
7that demonstrates that the loan issued by the department is not
8eligible to be treated as debt for federal or state low-income
9housing tax credit purposes without a reduction in the interest
rate
10of the loan.
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