There is hereby created the State Apartment Incentive Loan Program for the purpose of providing first, second, or other subordinated mortgage loans or loan guarantees to sponsors, including for-profit, nonprofit, and public entities, to provide housing affordable to very-low-income persons.

(1) Program funds shall be made available through a competitive solicitation process in a manner that meets the need and demand for very-low-income housing throughout the state. That need and demand must be determined by using the most recent statewide low-income rental housing market studies conducted every 3 years. However, at least 10 percent of the program funds, as calculated on an annual basis, must be made available to each of the following categories of counties as determined by using the population statistics published in the most recent edition of the Florida Statistical Abstract:

(a) Counties that have a population of 825,000 or more.
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Terms Used In Florida Statutes 420.5087

  • Appropriation: The provision of funds, through an annual appropriations act or a permanent law, for federal agencies to make payments out of the Treasury for specified purposes. The formal federal spending process consists of two sequential steps: authorization
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Corporation: means the Florida Housing Finance Corporation. See Florida Statutes 420.503
  • Department: means the Department of Commerce. See Florida Statutes 420.503
  • Elderly: means persons 62 years of age or older; however, this definition does not prohibit housing from being deemed housing for the elderly as defined in subsection (21) if such housing otherwise meets the requirements of subsection (21). See Florida Statutes 420.503
  • Eligible persons: means one or more natural persons or a family, irrespective of race, creed, national origin, or sex, determined by the corporation pursuant to a rule to be of low, moderate, or middle income. See Florida Statutes 420.503
  • Equitable: Pertaining to civil suits in "equity" rather than in "law." In English legal history, the courts of "law" could order the payment of damages and could afford no other remedy. See damages. A separate court of "equity" could order someone to do something or to cease to do something. See, e.g., injunction. In American jurisprudence, the federal courts have both legal and equitable power, but the distinction is still an important one. For example, a trial by jury is normally available in "law" cases but not in "equity" cases. Source: U.S. Courts
  • Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
  • Housing for the elderly: means , for purposes of…. See Florida Statutes 420.503
  • Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
  • Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
  • Lien: A claim against real or personal property in satisfaction of a debt.
  • Local government: means a unit of local general-purpose government as defined in…. See Florida Statutes 420.503
  • Moderate rehabilitation: means repair or restoration of a dwelling unit when the value of such repair or restoration is 40 percent or less of the value of the dwelling unit but not less than $10,000. See Florida Statutes 420.503
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • Mortgage: means :
    (a) A mortgage, mortgage deed, deed of trust, or other instrument:
    1. See Florida Statutes 420.503
  • Mortgagee: The person to whom property is mortgaged and who has loaned the money.
  • person: includes individuals, children, firms, associations, joint adventures, partnerships, estates, trusts, business trusts, syndicates, fiduciaries, corporations, and all other groups or combinations. See Florida Statutes 1.01
  • Personal property: All property that is not real property.
  • Project: means any work or improvement located or to be located in the state, including real property, buildings, and any other real and personal property, designed and intended for the primary purpose of providing decent, safe, and sanitary residential housing for persons or families, whether new construction, the acquisition of existing residential housing, or the remodeling, improvement, rehabilitation, or reconstruction of existing housing, together with such related nonhousing facilities as the corporation determines to be necessary, convenient, or desirable. See Florida Statutes 420.503
  • Services: means the professional services normally provided by the service provider. See Florida Statutes 420.503
  • Sponsor: means any individual, association, corporation, joint venture, partnership, trust, local government, or other legal entity or any combination thereof which:
    (a) Has been approved by the corporation as qualified to own, construct, acquire, rehabilitate, reconstruct, operate, lease, manage, or maintain a project; and
    (b) Except for a local government, has agreed to subject itself to the regulatory powers of the corporation. See Florida Statutes 420.503
  • State: means the State of Florida. See Florida Statutes 420.503
  • State Housing Trust Fund: means the trust fund established pursuant to…. See Florida Statutes 420.503
  • Substantial rehabilitation: means repair or restoration of a dwelling unit where the value of such repair or restoration exceeds 40 percent of the value of the dwelling. See Florida Statutes 420.503
(b) Counties that have a population of more than 100,000 but less than 825,000.
(c) Counties that have a population of 100,000 or less.

Any increase in funding required to reach the 10-percent minimum shall be taken from the county category that has the largest portion of the funding. The corporation shall adopt rules that establish an equitable process for distributing any portion of the 10 percent of program funds made available to the county categories specified in this subsection which remains unallocated. Counties that have a population of 100,000 or less shall be given preference under these rules.

(2) The corporation shall have the power to underwrite and make state apartment incentive loans or loan guarantees to sponsors, provided:

(a) The sponsor uses tax-exempt financing for the first mortgage and at least 20 percent of the units in the project are set aside for persons or families who have incomes which meet the income eligibility requirements of s. 8 of the United States Housing Act of 1937, as amended;
(b) The sponsor uses taxable financing for the first mortgage and at least 20 percent of the units in the project are set aside for persons or families who have incomes below 50 percent of the state or local median income, whichever is higher, which shall be adjusted by the corporation for family size; or
(c) The sponsor uses the federal low-income housing tax credit, and the project meets the tenant income eligibility requirements of s. 42 of the Internal Revenue Code of 1986, as amended.

This subsection does not prohibit a tenant from qualifying under the income eligibility criteria of paragraph (a), paragraph (b), or paragraph (c) due to the tenant’s participation in a job training program approved by the corporation. Compliance with the provisions of this subsection must be contractually provided for the term of the loan or 12 years, whichever is longer; however, this subsection does not apply to loans made to housing communities for the elderly to provide for lifesafety, building preservation, health, sanitation, or security-related repairs or improvements. Such loans shall be subject to tenant income criteria established by corporation rule.

(3) During the first 6 months of loan or loan guarantee availability, program funds shall be made available for use by sponsors who provide the housing set-aside required in subsection (2) for the tenant groups designated in this subsection. The funds made available to each of these groups shall be determined using the most recent statewide very-low-income rental housing market study available at the time of publication of each notice of fund availability required by paragraph (6)(b). The funds made available within each notice of fund availability to the tenant groups in paragraphs (b)-(e) may not be less than 10 percent of the funds available at that time. Any increase in funding required to reach the required minimum must be taken from the tenant group that would receive the largest percentage of available funds in accordance with the study. The funds made available within each notice of fund availability to the tenant group in paragraph (a) may not be less than 5 percent of the funds available at that time. The tenant groups are:

(a) Commercial fishing workers and farmworkers;
(b) Families;
(c) Persons who are homeless;
(d) Persons with special needs; and
(e) Elderly persons. Ten percent of the amount made available for the elderly shall provide loans to sponsors of housing for the elderly for the purpose of making building preservation, health, or sanitation repairs or improvements which are required by federal, state, or local regulation or code, or lifesafety or security-related repairs or improvements to such housing.
(4) Loans shall be in an amount not to exceed the lesser of 25 percent of the total project cost or the minimum amount required to make the project economically feasible; however, loans exceeding 25 percent of project cost may be made as provided in s. 420.507.
(5) The amount of the mortgage provided under this program combined with any other mortgage in a superior position shall be less than the value of the project without the housing set-aside required by subsection (2). However, the corporation may waive this requirement for projects in rural areas or urban infill areas which have market rate rents that are less than the allowable rents pursuant to applicable state and federal guidelines, and for projects which reserve units for extremely-low-income persons. In no event shall the mortgage provided under this program combined with any other mortgage in a superior position exceed total project cost.
(6) On all state apartment incentive loans, except loans made to housing communities for the elderly to provide for lifesafety, building preservation, health, sanitation, or security-related repairs or improvements, the following provisions shall apply:

(a) The corporation shall establish two interest rates in accordance with s. 420.507(22)(a)1. and 3.
(b) The corporation shall publish a notice of fund availability in a publication of general circulation throughout the state. Such notice shall be published at least 60 days prior to the application deadline and shall provide notice of the availability of funds established in subsection (3).
(c) The corporation shall provide by rule for the establishment of a review committee for the competitive evaluation and selection of applications submitted in this program, including, but not limited to, the following criteria:

1. Tenant income and demographic targeting objectives of the corporation.
2. Targeting objectives of the corporation which will ensure an equitable distribution of loans between rural and urban areas.
3. Sponsor’s agreement to reserve the units for persons or families who have incomes below 50 percent of the state or local median income, whichever is higher, for a time period that exceeds the minimum required by federal law or this part.
4. Sponsor’s agreement to reserve more than:

a. Twenty percent of the units in the project for persons or families who have incomes that do not exceed 50 percent of the state or local median income, whichever is higher; or
b. Forty percent of the units in the project for persons or families who have incomes that do not exceed 60 percent of the state or local median income, whichever is higher, without requiring a greater amount of the loans as provided in this section.
5. Provision for tenant counseling.
6. Sponsor’s agreement to accept rental assistance certificates or vouchers as payment for rent.
7. Projects requiring the least amount of a state apartment incentive loan compared to overall project cost, except that the share of the loan attributable to units serving extremely-low-income persons must be excluded from this requirement.
8. Local government contributions and local government comprehensive planning and activities that promote affordable housing and policies that promote access to public transportation, reduce the need for onsite parking, and expedite permits for affordable housing projects.
9. Project feasibility.
10. Economic viability of the project.
11. Commitment of first mortgage financing.
12. Sponsor’s prior experience. This criterion may not require a sponsor to have prior experience with the corporation to qualify for financing under the program.
13. Sponsor’s ability to proceed with construction.
14. Projects that directly implement or assist welfare-to-work transitioning.
15. Projects that reserve units for extremely-low-income persons.
16. Projects that include green building principles, storm-resistant construction, or other elements that reduce long-term costs relating to maintenance, utilities, or insurance.
17. Job-creation rate of the developer and general contractor, as provided in s. 420.507(47).
(d) The corporation may reject any and all applications.
(e) The corporation may approve and reject applications for the purpose of achieving geographic targeting.
(f) The review committee established by corporation rule pursuant to this subsection shall make recommendations to the board of directors of the corporation regarding program participation under the State Apartment Incentive Loan Program. The corporation board shall make the final decisions regarding which applicants shall become program participants based on the scores received in the competitive process, further review of applications, and the recommendations of the review committee. The corporation board shall approve or reject applications for loans and shall determine the tentative loan amount available to each applicant selected for participation in the program. The actual loan amount shall be determined pursuant to rule adopted pursuant to s. 420.507(22)(i).
(g) The loan term shall be for a period of not more than 15 years; however, if both a program loan and federal low-income housing tax credits are to be used to assist a project, the corporation may set the loan term for a period commensurate with the investment requirements associated with the tax credit syndication. The term of the loan may also exceed 15 years; however, if the lien of the corporation’s encumbrance is subordinate to the lien of another mortgagee, then the term may be made coterminous with the longest term of the superior lien. The corporation may renegotiate and extend the loan in order to extend the availability of housing for the targeted population. The term of a loan may not extend beyond the period for which the sponsor agrees to provide the housing set-aside required by subsection (2).
(h) The loan shall be subject to sale, transfer, or refinancing. The sale, transfer, or refinancing of the loan shall be consistent with fiscal program goals and the preservation or advancement of affordable housing for the state.
(i) The discrimination provisions of s. 420.516 shall apply to all loans.
(j) The corporation may require units dedicated for the elderly.
(k) Rent controls shall be set at the income set-aside levels committed to by the sponsor at the applicable income limitations established by the corporation for federal low-income tax credits.
(l) The proceeds of all loans shall be used for new construction, moderate rehabilitation, or substantial rehabilitation which creates or preserves affordable, safe, and sanitary housing units.
(m) Sponsors shall annually certify the adjusted gross income of all persons or families qualified under subsection (2) at the time of initial occupancy, who are residing in a project funded by this program. All persons or families qualified under subsection (2) may continue to qualify under subsection (2) in a project funded by this program if the adjusted gross income of those persons or families at the time of annual recertification meets the requirements established in s. 142(d)(3)(B) of the Internal Revenue Code of 1986, as amended. If the annual recertification of persons or families qualifying under subsection (2) results in noncompliance with income occupancy requirements, the next available unit must be rented to a person or family qualifying under subsection (2) in order to ensure continuing compliance of the project. The corporation may waive the annual recertification if 100 percent of the units are set aside as affordable.
(n) Upon submission and approval of a marketing plan which demonstrates a good faith effort of a sponsor to rent a unit or units to persons or families reserved under subsection (3) and qualified under subsection (2), the sponsor may rent such unit or units to any person or family qualified under subsection (2) notwithstanding the reservation.
(o) Sponsors may participate in federal mortgage insurance programs and must abide by the requirements of those programs. If a conflict occurs between the requirements of federal mortgage insurance programs and the requirements of this section, the requirements of federal mortgage insurance programs shall take precedence.
(7) There is authorized to be established by the corporation with a qualified public depository meeting the requirements of chapter 280 a separate fund to be named the “State Apartment Incentive Loan Fund,” which shall be administered by the corporation according to the provisions of this program. Any amounts held in the State Apartment Incentive Loan Trust Fund for such purpose as of January 1, 1998, must be transferred to the corporation for deposit in the State Apartment Incentive Loan Fund and the State Apartment Incentive Loan Trust Fund must be closed. There shall be deposited into the fund moneys from the State Housing Trust Fund as created by s. 420.0005, or moneys received from any other source, for the purpose of this program and all proceeds derived from the use of such moneys. In addition, all loan repayments, proceeds from the sale of any property, and any other proceeds that would otherwise accrue pursuant to the activities conducted under the provisions of the State Apartment Incentive Loan Program shall be deposited in the fund and shall not revert to the General Revenue Fund. Expenditures from the State Apartment Incentive Loan Fund shall not be required to be included in the corporation’s budget request or be subject to appropriation by the Legislature. If a loan commitment for program funds is entered into during the state fiscal year for which the program funds were appropriated, the funds shall continue to be made available for use during the entire construction period, even if it extends beyond the state fiscal year in which the loan commitment was entered.
(8) If a default on a loan occurs, the corporation may foreclose on any mortgage or security interest or commence any legal action to protect the interest of the corporation or the fund and recover the amount of the unpaid principal, accrued interest, and fees on behalf of the fund. The corporation may acquire real and personal property or any interest therein when that acquisition is necessary or appropriate to protect any loan; to sell, transfer, and convey any such property to a buyer without regard to the provisions of chapters 253 and 270; and, if that sale, transfer, or conveyance cannot be effected within a reasonable time, to lease such property for occupancy by eligible persons. All sums recovered from the sale, transfer, conveyance, or lease of such property shall be deposited into the State Apartment Incentive Loan Fund.
(9) The corporation is authorized to accept payment of deferred program interest at an interest rate that is consistent with rates currently authorized under this section, if the deferred interest is paid in not more than five equal annual installments, subject to the qualifications contained in this subsection.
1(10) The corporation may prioritize a portion of the program funds set aside under paragraph (3)(d) for persons with special needs as defined in s. 420.0004(13) to provide funding for the development of newly constructed permanent rental housing that provides housing for persons in foster care or persons aging out of foster care pursuant to s. 409.1451. Such housing shall promote and facilitate access to community-based supportive, educational, and employment services and resources that assist persons aging out of foster care to successfully transition to independent living and adulthood. The corporation must consult with the Department of Children and Families to create minimum criteria for such housing.
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