HOUSING INNOVATIONS TRUST FUND

M.G.L. pt. Part I, tit. Title XVII, ch. c. 121E

in effect

M.G.L. c. 121E, § 1 Definitions

c. 121E, § 1. Definitions Section 1. ''Alternative forms of rental and ownership housing'', shall include, but not be limited to: single room occupancy units; limited equity cooperative housing; transitional or permanent housing for the homeless; shelters for victims of domestic abuse; mutual housing; housing acquired by nonprofit entities pursuant to Title II of the National Emergency Low Income Housing Preservation Act of 1987 and Title VI of the National Affordable Housing Act of 1990; employer assisted housing; lease-to-purchase housing; housing produced pursuant to a court-approved receivership; innovative forms of housing which seek to mitigate the adverse impact on housing affordability in communities with high concentrations of college or university students; joint projects between municipalities or housing development agencies and institutions of higher education designed to produce or preserve affordable units within those areas; and other innovative forms of housing. ''Area median income'', income as determined by the United States Department of Housing and Urban Development. ''Authorities'', the Massachusetts Development Finance Agency established in chapter 23G, community development corporations established pursuant to chapter 40F, the Community Economic Development Assistance Corporation established in chapter 40H, operating agencies established pursuant to chapter 121B, the Massachusetts Housing Finance Agency, established in chapter 708 of the acts of 1966 and nonprofit agencies certified by the United States Department of Housing and Urban Development as community housing development organizations. ''Department'', the executive office of housing and livable communities. ''Fund'', the Housing Innovations Trust Fund established in section 2.

M.G.L. c. 121E, § 2 Housing Innovations Trust Fund; administration; projects

c. 121E, § 2. Housing Innovations Trust Fund; administration; projects Section 2. (a) There shall be within the department a separate fund to be known as the Housing Innovations Trust Fund. The department shall administer the fund for the purpose of making grants and loans to public or quasi-public entities to facilitate the production and retention of alternative forms of rental and ownership housing; provided, however, that 25 per cent of the beneficiaries of the fund shall be persons whose income shall not exceed 30 per cent of the area median income and 50 per cent of the beneficiaries of the fund shall be persons whose income not exceed 80 per cent of the area median income. The department shall give preference to those projects that provide transitional or permanent housing for homeless individuals and families and disabled persons. The fund shall be an expendable trust fund and shall not be subject to appropriation. (b) There shall be credited to the fund revenue from appropriations or other monies authorized by the general court and specifically designated for the fund and any gifts, grants, private contributions, repayment of loans, fees and charges imposed relative to the making of loans, grants, subsidies, credit enhancements and other financial assistance, investment income earned on the fund's assets and any other sources. Money remaining in the fund at the end of a fiscal year shall not revert to the General Fund. (c) The department shall provide assistance from the fund using only the criteria established in this chapter for projects owned or sponsored by authorities including but not limited to, projects that involve complex multiple-source financing or the preservation of existing affordable housing; provided, however, that no assistance shall be authorized unless the sponsor thereof is current on all existing mortgage obligations with the commonwealth or any political subdivision thereof. The department shall enter into agreements with the Community Economic Development Assistance Corporation to provide assistance from the fund for projects owned or sponsored by nonprofit organizations.

M.G.L. c. 121E, § 3 Assistance from fund; eligible activities; administration of loans

c. 121E, § 3. Assistance from fund; eligible activities; administration of loans Section 3. (a) The fund shall finance low and no interest loans, grants, subsidies, credit enhancements and other financial assistance for alternative forms of rental and ownership housing; provided, however, that assistance shall be the minimum amount necessary to make a project feasible. Activities eligible for assistance from the fund shall include, but not be limited to: (1) capital grants and deferred payment loans for new construction, rehabilitation or acquisition of alternative forms of rental and ownership housing units; (2) capital grants and deferred payment loans for new construction, rehabilitation or acquisition of alternative forms of rental and ownership housing for homeless families and individuals; (3) mortgage insurance guarantees and other credit enhancements for alternative forms of rental and ownership housing; (4) projects making alternative forms of rental and ownership housing more accessible to senior citizens and persons with disabilities; (5) matching funds for municipalities that sponsor alternative forms of rental and ownership housing initiatives; and (6) matching funds for employer-based programs to assist employees in meeting their rental and homeownership housing costs. (b) A loan program established pursuant to subsection (a) shall be administered by the department through contracts with authorities. The authorities may, pursuant to the terms and conditions of contracts with the department, directly issue loans for the purposes of the program or may enter into subcontracts with nonprofit organizations established pursuant to chapter 180 for those purposes. Loans issued directly or indirectly by those organizations shall be: (1) subject to the review and approval of the department; (3) issued only if a contract or agreement for the use of the property for housing purposes provides for the recording of a restriction in the registry of deeds or the registry district of the land court in the county in which the affected real property is located, for the benefit of the department, running with the land, that the land be used for providing alternative forms of rental and ownership housing; provided, that the property shall not be released from the restriction until: (i) the balance of the principal and interest for the loan has been repaid in full; (ii) a mortgage foreclosure deed has been recorded; or (iii) there has been a disposition of the property; provided, that the department determines that relevant clients will be better served at an alternative property and the proceeds from the disposition of the property will be used, to the extent necessary for replacement of the housing at the property, for 1 or both of the following purposes: (A) to acquire such alternative property; or (B) to rehabilitate such alternative property; (4) issued for a term of up to 30 years during which time repayment may be deferred by the loan issuing authority; provided further, that if on the date the loans become due and payable to the commonwealth an outstanding balance exists, the loans may be extended for periods of not more than 10 years, as the department determines; provided, that the project, whether at the original property, or at an alternative property pursuant to clause (3), continues to remain affordable housing as set forth in the contract or agreement entered into for the duration of the project by the department; and provided further, that in the event that the terms of repayment detailed in this section would cause a project authorized by this chapter to become ineligible to receive federal funds which would otherwise assist in the development of that project, the department may waive the terms of repayment which would cause the project to become ineligible; (5) subject interest rates as fixed by the department, in consultation with the state treasurer; and (6) issued once the department considers a balanced geographic plan for any alternative forms of housing.

M.G.L. c. 121E, § 4 Expiration of affordability restrictions; purchase option; waiver; first refusal option

c. 121E, § 4. Expiration of affordability restrictions; purchase option; waiver; first refusal option Section 4. For 120 days after the expiration of affordability restrictions on housing assisted under this chapter, the department or its assignee, who is a qualified developer selected pursuant to the terms of this section under the guidelines of the department, shall have an option to purchase that property at its current appraised value, less any remaining obligations of the owner upon the expiration of the affordability restrictions. The department or its assignee may purchase or acquire the housing only for the purposes of preserving or providing affordable housing. Failure to exercise the purchase option within the 120–day period shall constitute a waiver of the purchase option by the department or its assignee. Two impartial appraisers shall determine, within 60 days after the expiration of the affordability restrictions, the current appraised value in accordance with recognized professional standards. Two professionals in the field of multi-unit residential housing shall each select an appraiser. The owner and the department, respectively, shall each designate a professional within 30 days after the expiration of the affordability restrictions. If there is a difference in the valuations, the valuations shall be added together and divided by 2 to determine the current appraised value of the property. No sale, transfer or other disposition of the property shall be consummated until either the purchase option period shall have expired or the owner shall have been notified, in writing, by the department or its assignee that the option will not be exercised. The option shall be exercised only by written notice signed by a designated representative of the department or its assignee, mailed to the owner by certified mail at the address specified in the notice of intention and recorded with the registry of deeds or the registry district of the land court of the county in which the affected real property is located, within the option period. If the purchase option has been assigned to a qualified developer selected pursuant to this section, the written notice shall state the name and address of the developer and the terms and conditions of the assignment. Before any sale or transfer or other disposition of the housing where the department has not previously exercised an option to purchase, an owner shall offer the department or its assignee, who shall be a qualified developer selected pursuant to this section, a first refusal option to meet a bona fide offer to purchase the property. The owner shall provide to the department or its assignee written notice by regular and certified mail, return receipt requested, of the owner's intention to sell, transfer or otherwise dispose of the property. The department or its assignee shall hold the first refusal option for the first 120 days after receipt of the owner's written notice of intent to transfer the property. Failure to respond to the written notice of intent to sell, transfer or otherwise dispose of the property within the 120–day period after the receipt thereof shall constitute a waiver of the first refusal option by the department. No sale, transfer or other disposition of the property shall be consummated until either the first refusal option period shall have expired or the owner shall have been notified in writing by the department or its assignee that the option will not be exercised. The option shall be exercised only by written notice signed by a designated representative of the department or its assignee, mailed to the owner by certified mail at the address specified in the notice of intention and recorded with the registry of deeds or the registry district of the land court of the county in which the affected real property is located, within the option period. If the first refusal option has been assigned to a qualified developer selected pursuant to this section, the written notice shall state the name and address of the developer and the terms and conditions of the assignment. An affidavit before a notary public that the notice of intent was mailed on behalf of an owner shall conclusively establish the manner and time of the giving of notice the affidavit and notice that the option will not be exercised shall be recorded in the registry of deeds or the registry district of the land court of the county in which the affected real property is located. Each notice of intention, notice of exercise of the purchase option or first refusal option and notice that the purchase option or first refusal option will not be exercised shall contain the name of the record owner of the property and a reasonable description of the premises to be sold or converted and each affidavit, signed before a notary public, shall have attached to it a copy of the notice of intention to which it relates. The notices of intention shall be mailed to the relevant parties, in the care of the keeper of records for the party in question. Upon notifying the owner in writing of its intention to exercise its purchase option or first refusal option during the 120–day period, the department or its assignee shall have an additional 120 days, beginning on the date the purchase option period or first refusal option period expires, to purchase the property. Those time periods may be extended by mutual agreement between the department or its assignee and the owner of the property. Any extension agreed upon shall be recorded in the registry of deeds or the registry district of the land court of the county in which the affected real property is located. Within a reasonable time after requesting an extension, the owner shall make available to the department or its assignee any information that is reasonably necessary for the department to exercise its options.

M.G.L. c. 121E, § 5 Regulations

c. 121E, § 5. Regulations Section 5. The department shall promulgate regulations for the implementation, administration and enforcement of this chapter.

M.G.L. c. 121E, § 6 Annual report; contents

c. 121E, § 6. Annual report; contents Section 6. The department shall annually file a report with the house and senate committees on ways and means, the joint committee on housing and the joint committee on bonding, capital expenditures and state assets detailing all expenditures from the fund including, but not limited to, the recipient of the funds, the cost of administration and the number of units constructed, acquired and rehabilitated.

Source: Massachusetts General Court (malegislature.gov)URL: https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXVII/Chapter121EFetched: 10/20/2026