OAR 813-060-0040
Processing Procedures
(1)
Before accepting a project for the application process, the prospective Borrower shall submit an application to the Department on forms acceptable to the Department. If the Project meets the Program requirements, an application conference with the prospective Borrower shall be scheduled. At the conference, the Department may discuss, but is not limited to discussing:(a)
Type of loan requested;(b)
Type and formation of prospective Borrower’s company (sole proprietorship, partnership, corporation, nonprofit, etc.) and qualifications;(c)
Requested of loan amount, terms and interest rate;(d)
Any time constraints on prospective Borrower or Department;(e)
Charges;(f)
Reserve and equity requirements;(g)
Debt service ratio and other contingency requirements:(h)
Appraisal requirements;(i)
Environmental survey(s);(j)
Contractor’s cost estimate and qualifications;(k)
Management and maintenance plans;(l)
Project management requirements, reports, and qualifications;(m)
Loan servicing requirements and procedures;(n)
Design and related requirements;(o)
Document requirements;(p)
Construction procedures;(q)
Department Loan processing procedures;(r)
Eligibility requirements under federal and state law and regulation;(s)
Site Control;(t)
Reserves and costs for Bond issue; and(u)
Any other items pertinent to the proposed Project.(2)
At the conclusion of the application conference, if the prospective Borrower and the Department agree to proceed with the loan application process, prospective Borrower shall provide the necessary loan application documentation.(3)
After receiving a completed loan application package from the prospective Borrower, the Department shall evaluate each Project for consistency with the Department’s interpretation of sound architectural and planning principles and prudent underwriting standards.(4)
In order to qualify for a loan, a Project shall:(a)
Be approved by the Department with respect to site; location; market demand; financial feasibility; qualifications of general contractor, management agent and developer; appraisal; financial strength and creditworthiness of the Eligible Borrower; management plan; final architectural package; organizational documents; ALTA title report; resident services plan, and any other information the Department shall prescribe;(b)
Meet all applicable state and local land use and zoning requirements, housing codes, and similar requirements;(c)
Be in compliance with federal regulations, state statutes and Program rules;(d)
Be located in the State of Oregon;(e)
If the loan is for an amount over $100,000, be approved by the Housing Stability Council prior to the Department’s issuance of a loan Commitment:(A)
The Department shall review each application for a loan over $100,000 and prepare a proposal to the Housing Stability Council for approval or disapproval. The Department will send a copy of its proposal to the Eligible Borrower with a notice of the Housing Stability Council meeting at which the application will be considered. Upon receipt of the notice, the Eligible Borrower may request an opportunity to present testimony at the meeting;(B)
After considering the Department’s proposal, as well as any other testimony presented, the Housing Stability Council shall approve or disapprove the application or take other appropriate action;(c)
The Eligible Sponsor Borrower shall promptly be advised in writing of the Housing Stability Council’s decision.(5)
In approving or disapproving any loan application, the Department and the Housing Stability Council shall consider, in addition to requirements elsewhere stated in the Program rules, the following criteria:(a)
The location of the Project site, including its proximity to transportation, shopping, social, commercial and recreational facilities, medical services and such other facilities and services as shall best serve the residents;(b)
Financial feasibility of the Project;(c)
Availability of street, sewer, water, utilities and other public services;(d)
Availability of public transportation;(e)
Architectural design, including aesthetic quality soundness of construction, energy efficiency, and suitability to the needs of the residents to be served;(f)
Compliance with applicable state and local comprehensive plan and land use regulations;(g)
Market demand;(h)
The financial strength, credit reputation and history of the Eligible Borrower; and(i)
The experience of the developer, contractors, architects, consultants and management agent in developing, constructing and operating housing Projects.(6)
The Eligible Borrower may submit a written request for review and appeal of the Housing Stability Council’s decision in accordance with the provisions of ORS Chapter 183 (Administrative Procedures Act). To be considered, the request must be received by the Department within 30 days of the date of the notice of initial loan disapproval.(7)
Upon loan approval, the Department shall issue a Commitment, which may be subject to loan funds being available, which shall include:(a)
The amount of the loan;(b)
The maximum rate of interest to be charged on such loan;(c)
The term of the loan;(d)
The amount of the Commitment fee, Rent-Up Reserve Account and Contingency Escrow Account;(e)
When the Commitment fee shall be paid, and when the Rent-Up Reserve Account and Contingency Escrow Account shall be funded;(f)
All other conditions of the Commitment, and when they shall be fulfilled;(g)
Provisions concerning construction;(h)
Provisions and conditions of loan disbursement;(i)
Provisions of loan closing; and(j)
Conditions of termination of the Commitment.(8)
If the Commitment conditions are not completed by the dates specified in the Commitment, the offer for a Commitment shall expire, unless the Department grants an extension in writing.(9)
Construction and completion:(a)
During the construction of the Project, the Department may conduct random inspections for Borrower’s compliance with the plans and specifications previously approved by the Department. The Borrower’s architect shall submit regular inspection reports to the Department. Change orders must be signed by the contractor, Project architect and the Borrower before being submitted to the Department for its approval and prior to the changes being made;(b)
Upon completion of construction of the Project, the Department shall perform an inspection to assure the Borrower’s compliance with the approved plans and specifications. If some items of construction remain to be completed due to circumstances beyond the control of the Borrower (provided the incomplete items do not detract from livability or safety of the Project), the Department may require the Borrower to escrow as approved by the Department and under Department control an amount equal to one and one-half times the estimated cost of completion, until the construction item is completed.
Source:
Rule 813-060-0040 — Processing Procedures, https://secure.sos.state.or.us/oard/view.action?ruleNumber=813-060-0040.