Part D - Specified Model Programs

42 USC 12801 - General authority

Among the alternative model programs that the Secretary shall make available for use by participating jurisdictions under the provisions of section 12743 of this title shall be model programs specified in this part. The Secretary shall keep these specified model programs under review and submit to Congress such recommendations for change as the Secretary determines to be appropriate.

42 USC 12802 - Rental housing production

(a) Repayable advances 

(1) In general 
The Secretary shall make available a model program under which repayable advances may be made to public and private project sponsors in constructing, acquiring, or substantially rehabilitating projects to be used as affordable rental housing, including limited equity cooperatives and mutual housing.
(2) Maximum amount of advance 
An advance under this model program shall not exceed 50 percent of the total costs associated with the construction, acquisition, or substantial rehabilitation of the project, as determined by the participating jurisdiction.
(3) Terms of repayment 

(A) Interest payments 

(i) In general Under the model program, advances shall be repaid with interest calculated at a rate of not more than 3 percent per year, as determined by the participating jurisdiction to be appropriate. Interest shall begin to accrue 1 year after the completion of the construction, acquisition, or substantial rehabilitation of the project and shall be payable in annual installments.
(ii) Exception Interest and any accrued interest shall be payable only from the surplus cash flow of the project, after a minimum return on equity determined by the participating jurisdiction to be appropriate. As used in the previous sentence, the term surplus cash flow means the cash flow of the project after the payment of all amounts due under the first mortgage, operating expenses, and required replacement reserves, as determined by the participating jurisdiction.
(B) Additional interest payments 
Under the model program, for any year in which the sum of the surplus cash flow of a project and the return on equity exceeds all interest payments due under subparagraph (A), 50 percent of the excess surplus cash flow shall be paid to the participating jurisdictions HOME Investment Trust Fund as additional interest.
(C) Principal and unpaid interest 
The principal amount of an advance under the model program, and any interest remaining unpaid pursuant to subparagraph (A)(ii) shall be repayable when the housing no longer qualifies as affordable housing in accordance with section 12749 (b) of this title.
(b) Selection guidelines 

(1) In general 
The Secretary shall establish guidelines for the selection of projects by participating jurisdictions for assistance under the model program. Such guidelines shall be designed to select projects in areas and for markets demonstrating the greatest need for the production of affordable rental housing.
(2) Specific requirements 
The selection guidelines may include
(A) the extent of the shortage of rental housing in the area that is available to low-income families;
(B) the extent large families with children will be served by the project;
(C) the extent to which the project provides congregate facilities and has available supportive services that will permit elderly or handicapped residents who become frail and are in need of assistance in living to continue to reside in the project;
(D) the extent of very low-income and low-income occupancy in excess of the income targeting requirements in section 12744 of this title;
(E) the extent of the project sponsors commitment of equity to the project (except that this criterion shall not apply to or affect the selection of applications submitted by public housing agencies and nonprofit">nonprofit entities);
(F) the extent of the project sponsors commitment of equity to the project in comparison to the value of all public assistance for the project, including assistance under this subchapter, other Federal assistance and financing, and State and local government contributions (except that this criterion shall not apply to or affect the selection of applications submitted by public housing agencies and nonprofit">nonprofit entities);
(G) the extent of non-Federal public or private assistance to the project;
(H) the extent to which the project provides supportive services for persons with disabilities; and
(I) any other factor determined by the Secretary to be appropriate.
(c) Guidelines 
The Secretary shall publish guidelines for the model program under this section not later than 180 days after November 28, 1990.

42 USC 12803 - Rental rehabilitation

(a) In general 
The Secretary shall make available a model program to support the rehabilitation of privately owned rental housing located in neighborhoods where the median income does not exceed 80 percent of the area median as determined by the Secretary and where rents can reasonably be expected not to change materially over an extended period of time.
(b) Amount of subsidy 
The amount of the rehabilitation subsidy shall be moderate and shall generally not exceed 50 percent of the total costs associated with the rehabilitation of the housing.
(c) Additional restrictions 
The guidelines of the model program shall generally comport with the additional protections and restrictions specified under section 1437o (c)1 of this title.
[1] See References in Text note below.

42 USC 12804 - Rehabilitation loans

(a) In general 
The Secretary shall make available a model program to provide direct loans to finance the rehabilitation of low and moderate income single family and multifamily residential properties.
(b) Condition of loans 
The Secretary shall establish terms and conditions to ensure that such loans are acceptable risks, taking into consideration the need for rehabilitation, the security for the loan and the ability of the borrower to repay the loan. The Secretary may establish the interest rate for loans under the model program, which shall include special interest rates for loans to borrowers with incomes below 80 percent of the area median income.
(c) Additional restrictions 
Guidelines for the model program may require that the property
(1) be located in an area that contains a substantial number of dwellings in need of rehabilitation;
(2) the property[1] is residential and owner-occupied; and
(3) the property[1] is in need of rehabilitation or concentrated code enforcement within a reasonable time, and the rehabilitation of such property is consistent with a local plan for rehabilitation or code enforcement. Additional guidelines for the model program shall generally comport with the additional protections and restrictions specified under section 1452b2 of this title.
[1] So in original. The words “the property” probably should not appear.
[2] See References in Text note below.

42 USC 12805 - Sweat equity model program

(a) In general 
The Secretary shall make available a model program to provide grants to public and private nonprofit">nonprofit organizations and community housing development organizations to provide technical and supervisory assistance to low-income and very low-income families, including the homeless, in acquiring, rehabilitating, and constructing housing by the self-help housing method.
(b) Rehabilitation of properties 
The program shall target for rehabilitation properties which have been acquired by the Federal, State, or local governments.
(c) Homeownership opportunities through sweat equity 

(1) The program shall utilize the skilled or unskilled labor of eligible families in exchange for acquisition of the property.
(2) Training shall be provided to eligible families in building and home maintenance skills.
(d) Rental opportunities through sweat equity 

(1) The program shall include rental opportunities for eligible families which will help expand the stock of affordable housing which is most appropriate for the target group.
(2) The use of the tenants skilled or unskilled labor shall be encouraged in lieu of or as a supplement to rent payments by the tenant.
(e) “Self-help housing” defined 
The term self-help housing means the same as in section 1490c of this title.
(f) Additional restrictions 
The guidelines for the model program shall generally comport with the additional protections and restrictions specified under section 1490c of this title.

42 USC 12806 - Home repair services grants for older and disabled homeowners

(a) In general 
The Secretary shall make available a model program to provide home repair services for older homeowners and disabled homeowners, including such services as the examination of homes, repair services, and follow-up to ensure the continued effectiveness of the repairs provided.
(b) Eligible recipients 
Home repair services shall be provided to homeowners who
(1) own and reside in the dwellings for which services are provided;
(2) are older or disabled; and
(3) are members of low-income families.
(c) Permitted restrictions 
Guidelines for the model program shall require that
(1) assisted dwelling units be the primary residence of the homeowner for whom services are provided;
(2) preferences be provided for
(A)  very low-income families, and
(B)  individuals with intense need characterized by noneconomic factors such as physical and mental disabilities, language barriers, and cultural, social, or geographical isolation caused by racial or ethnic status that restricts the ability of an individual to perform normal daily tasks or that threatens the capacity of the individual to live independently;
(3) any fees charged be based on the income of the individual receiving the home repair services.

42 USC 12807 - Low-income housing conservation and efficiency grant programs

(a) In general 
The Secretary shall make available a model program to provide safe, energy-efficient affordable housing for low-income persons.
(b) Activities 
The model program shall provide for
(1) identification of housing that is
(A) owned and occupied by low-income families who have received, are currently receiving, or are scheduled to receive assistance under the weatherization assistance for low-income persons program under part A of title IV of the Energy Conservation and Production Act [42 U.S.C. 6861 et seq.] (or a comparable Federal or State program);
(B) in danger of becoming uninhabitable within a 5-year period because of structural weaknesses or problems; and
(C) not sufficiently sound to permit energy conservation improvements without other repair or rehabilitation measures to protect such energy investments;
(2) repairs that will significantly prolong the habitability of units identified under paragraph (1), including roofing, electrical, plumbing, furnace, and foundation repairs or replacement that will prolong the use of the unit as a safe and energy-efficient residence for low-income persons; and
(3) reasonable steps to ensure that any units so repaired will remain occupied by persons or families eligible for assistance under this subchapter.

42 USC 12808 - Second mortgage assistance for first-time homebuyers

(a) In general 
The Secretary shall make available a model program under which units of general local government provide loans (secured by second mortgages) with deferred payment of interest and principal to first-time homebuyers.
(b) Homeownership counseling 
The program under this section shall provide for homeownership counseling to first-time homebuyers assisted, which shall include
(1) counseling before and after purchase of the property;
(2) assisting first-time homebuyers in identifying the most suitable and affordable properties;
(3) providing homebuyers with financial management assistance;
(4) assisting homebuyers in understanding mortgage transactions and home sales contracts; and
(5) assisting homebuyers with eliminating any credit problems that may prevent the homebuyers from purchasing the property.
(c) Eligibility requirements 
Deferred payment loans secured by second mortgages may be provided under the model program under this section if
(1) the homebuyer assisted is a first-time homebuyer;
(2) the property secured by the second mortgage is a single-family residence and is the principal residence of the homebuyer; and
(3) the principal obligation of the deferred payment loan secured by a second mortgage does not exceed 30 percent of the acquisition price of the residence to the homebuyer.
(d) Payment terms 

(1) Period of deferral 
The payment of any principal and interest on a loan under this section shall be deferred for not less than the 5-year period beginning on the date of the acquisition of the residence by the homebuyer.
(2) Interest rate 
The interest rate on the unpaid balance of a loan under this section shall be at least 4 percent.
(3) Repayment period 
A deferred payment loan secured by a second mortgage shall be repayable over the 15-year period beginning at the end of the deferral period.
(e) Security 
A deferred payment loan assisted with amount[1] provided under a grant under this section shall be secured by a lien on the property involved, which lien shall be subordinate to the first mortgage on the property.
[1] So in original. Probably should be “amounts”.

42 USC 12809 - Rehabilitation of State and local government in rem properties

(a) In general 
The Secretary shall make available a model program under which States and units of general local government may convert in rem properties to provide affordable permanent housing for the homeless by leasing such properties to nonprofit">nonprofit organizations and permitting such organizations to rehabilitate the properties.
(b) Target 
The program shall target vacant properties for rehabilitation by nonprofit">nonprofit organizations.

42 USC 12810 - Cost-saving building technologies and construction techniques

(a) In general 
The Secretary shall make available a model program to utilize cost-saving building technologies and construction techniques for purposes of providing homeownership and rental opportunities under this subchapter.
(b) Selection criteria 
The Secretary shall establish criteria for participating jurisdictions to select projects for assistance under the model program which may include
(1) the extent to which innovative, cost-saving building and construction technologies are utilized;
(2) the extent to which innovative, cost-saving construction techniques are utilized;
(3) the extent to which units will be made available to low-income families and individuals;
(4) the extent to which non-Federal public or private assistance is utilized; and
(5) any other factor, determined by the Secretary to be appropriate.
(c) Guidelines 
The Secretary shall publish guidelines for the model program under this section not later than 180 days after October 28, 1992.
(d) Report 
The Secretary shall submit a biennial report to the Congress on the utilization of the model program under this section.