Print Friendly HOUSE BILL NO. 684 – Housing/Finance Assn, nonprofits
HOUSE BILL NO. 684
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H0684......................................................by STATE AFFAIRS
IDAHO HOUSING AND FINANCE ASSOCIATION - Amends existing law to remove
powers of the Idaho Housing and Finance Association to organize nonprofit
corporations to assist the association in providing for housing projects;
and to provide limits on conflict of interest.
02/24 House intro - 1st rdg - to printing
02/25 Rpt prt - to St Aff
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-fifth Legislature Second Regular Session - 2000
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 684
BY STATE AFFAIRS COMMITTEE
1 AN ACT
2 RELATING TO THE POWERS OF THE IDAHO HOUSING AND FINANCE ASSOCIATION; AMENDING
3 SECTION 67-6206, IDAHO CODE, TO REMOVE POWERS OF THE ASSOCIATION TO ORGA-
4 NIZE A NONPROFIT CORPORATION TO ASSIST THE ASSOCIATION IN PROVIDING FOR
5 HOUSING PROJECTS; AMENDING SECTION 67-6221, IDAHO CODE, TO PROVIDE LIMITS
6 ON CONFLICT OF INTEREST; AMENDING SECTION 67-6224A, IDAHO CODE, TO PROVIDE
7 AN EXCEPTION TO THE OTHERWISE UNRESTRICTED, UNLIMITED POWERS OF THE ASSO-
8 CIATION AND TO MAKE A TECHNICAL CORRECTION; AND PROVIDING AN EFFECTIVE
10 Be It Enacted by the Legislature of the State of Idaho:
11 SECTION 1. That Section 67-6206, Idaho Code, be, and the same is hereby
12 amended to read as follows:
13 67-6206. POWERS OF ASSOCIATION. The housing and finance association is an
14 independent public body corporate and politic, exercising public and essential
15 governmental functions, and having all the powers which are hereby declared to
16 be public purposes necessary or convenient to carry out and effectuate the
17 purposes and provisions of this act, including the following powers in addi-
18 tion to others herein granted:
19 (a) To sue and to be sued; to have a seal and to alter the same at pleas-
20 ure; to have perpetual succession; to make and execute contracts and other
21 instruments necessary or convenient to the exercise of the powers of the asso-
22 ciation; and to make and from time to time amend and repeal bylaws, rules, not
23 inconsistent with this act, to carry into effect the powers and purposes of
24 the association.
25 (b) To conduct its operations within any or all of the counties of the
27 (c) To cooperate with housing authorities throughout Idaho in the devel-
28 opment of housing projects.
29 (d) To assign priorities for action and revise or modify said priorities
30 from time to time.
31 (e) To make and execute agreements, contracts and other instruments nec-
32 essary or convenient in the exercise of the powers and functions of the asso-
33 ciation under this act, including contracts with any housing sponsor, mortgage
34 lender, person, firm, corporation, governmental agency, or other entity; and
35 to include in any contract let in connection with a project, stipulations
36 requiring that the contractor and any subcontractors comply with requirements
37 as to minimum wages and maximum hours of labor, and comply with any conditions
38 which the federal government may have attached to its financial aid of the
39 project and to designate mortgage lenders to act for and in behalf of the
40 association, with respect to originating or servicing and processing mortgage
41 loans of the association, and to pay the reasonable value of service rendered
42 to the association by such mortgage lenders pursuant to contracts with mort-
43 gage lenders.
1 (f) To lease, sell, construct, finance, reconstruct, restore, rehabili-
2 tate, operate or rent any housing projects, nonprofit facilities or any dwell-
3 ings, houses, accommodations, lands, buildings, structures or facilities
4 embraced in any housing project or nonprofit facilities and, subject to the
5 limitations contained in this act, to establish and revise the rents or
6 charges therefor.
7 (g) To own, hold and improve real or personal property; to purchase,
8 lease, obtain options upon, acquire by gift, grant, bequest, devise, eminent
9 domain or otherwise, any real or personal property or any interest therein.
10 (h) To acquire any real property; to sell, lease, exchange, transfer,
11 assign, pledge or dispose of any real or personal property or any interest
13 (i) To insure or provide for the insurance of any real or personal prop-
14 erty or operation of the association against any risks or hazards, and to pro-
15 cure or agree to the procurement of insurance or guarantees from the federal
16 government or other source for the payment or purchase of any bonds or parts
17 thereof issued by the association, including the power to pay for any such
18 insurance or guarantees.
19 (j) To invest any funds held in reserves or sinking funds, or any funds
20 not required for immediate disbursement, in property or securities in which a
21 bank, as defined in the "bank act," title 26, Idaho Code, may legally invest
22 funds including without limitation, to agree to purchase the obligations of
23 any federal, state or local government upon such conditions as the association
24 may determine to be prudent and in its best interest.
25 (k) Within its area of operation: to investigate into living, dwelling
26 and housing conditions and into the means and methods of improving such condi-
27 tions; to determine where slum areas exist or where there is a shortage of
28 adequate, safe and sanitary dwelling accommodations for persons of low-income;
29 to make studies and recommendations relating to the problem of clearing,
30 replanning and reconstruction of slum areas and the problem of providing
31 dwelling accommodations for persons of low-income, and to cooperate with the
32 city, the county, the state or any political subdivision thereof in action
33 taken in connection with such problems; and to engage in research, studies and
34 experimentation on the subject of housing.
35 (l) To participate in cooperative ventures with any agencies, organiza-
36 tions and individuals in order to undertake the provision of housing for per-
37 sons of low-income or to undertake the provision of nonprofit facilities.
38 (m) To provide research and technical assistance to eligible agencies,
39 organizations and individuals eligible to develop low cost housing and to
40 research new low cost housing development and construction methods.
41 (n) To make and undertake commitments to make or participate in the mak-
42 ing of mortgage loans to persons of low-income and to housing sponsors,
43 including without limitation federally insured mortgage loans, and to make
44 temporary loans and advances in anticipation of permanent loans to housing
45 sponsors; said mortgage loans to housing sponsors shall be made to finance the
46 construction, improvement, or rehabilitation of housing projects for persons
47 of low-income, and/or mixed income housing projects upon the terms and condi-
48 tions set forth in this act; provided, however, that such loans shall be made
49 only upon the determination by the association that mortgage loans are not
50 otherwise available, wholly or in part, from private lenders upon reasonably
51 equivalent terms and conditions.
52 (o) To purchase, or make commitments to purchase or participate in the
53 purchase of mortgage loans from mortgage lenders which loans have been made
54 for the construction, improvement, or rehabilitation of housing projects for
55 persons of low-income and/or mixed income housing projects or loans which have
1 been made to persons of low-income for residential housing, upon terms set
2 forth in this act; provided, however, that any such purchase shall be made
3 only upon the determination by the association that the mortgage loans to be
4 made are not otherwise being made by mortgage lenders upon reasonably equiva-
5 lent terms and conditions. Also, to purchase, or make commitments to purchase
6 or participate in the purchase of mortgage loans from mortgage lenders whether
7 or not said loans were made to persons of low-income, upon terms set forth in
8 this act; provided, however, that the proceeds from such purchase or the
9 equivalent thereof shall be reinvested in obligations of the association, in
10 mortgage loans to persons of low-income or in mortgage loans for housing proj-
11 ects for persons of low-income and/or mixed income housing projects, and pro-
12 vided that any such purchase shall be made only upon the determination by the
13 association that the mortgage loans to be made are not otherwise being made by
14 mortgage lenders upon reasonably equivalent terms and conditions.
15 (p) To provide interim financing for housing projects including mixed
16 income housing projects approved by the association, provided that the associ-
17 ation has determined that such financing is not otherwise available from mort-
18 gage lenders upon reasonably equivalent terms and conditions.
19 (q) To prescribe rules and policies in connection with the performance of
20 its functions and duties.
21 (r) To do all other things deemed necessary and desirable to accomplish
22 the objectives of this act.
23 (s) To borrow money and issue bonds and notes or other obligations, to
24 invest the proceeds thereof in any lawful manner and to fund or refund the
25 same, and to provide for the rights of the holders of its obligations as pro-
26 vided in this act and in connection therewith, to waive, by resolution or
27 other document of the association, the exemption from federal income taxation
28 of interest on any of the association's obligations under existing or future
29 federal law and to establish, maintain and preserve the association's general
30 obligation rating and any rating on its bonds, notes or other obligations.
31 (t) To receive and accept aid or contributions from any source.
32 (u) To employ architects, engineers, attorneys, accountants, housing con-
33 struction and financial experts and such other advisors, consultants and
34 agents as may be necessary in its judgment and to fix their compensation.
35 (v) To insure mortgage payments of any mortgage loan made for the purpose
36 of constructing, rehabilitating, purchasing, leasing, or refinancing housing
37 projects upon such terms and conditions as the association may prescribe.
38 (w) To fix and revise from time to time and charge and collect fees and
39 charges in connection with loans made or other services provided by the asso-
40 ciation pursuant to this act, and to make and publish rules respecting the
41 making and purchase of mortgage loans.
42 (x) To organize a nonprofit corporation to assist the association in pro-
43 viding for housing projects.
44 (y) To enter upon and inspect any housing project, including housing
45 projects undertaken by housing sponsors, for the purpose of investigating the
46 physical and financial condition thereof, and its construction, rehabilita-
47 tion, operation, management and maintenance, and to examine all books and
48 records with respect to capitalization, income and other matters relating
50 ( zy) To order such alterations, changes or repairs as may be necessary to
51 protect the security of its investment in a housing project or the health,
52 safety, and welfare of the occupants thereof.
53 ( aaz) To make secured loans for the purpose of providing temporary or per-
54 manent financing or refinancing of all or part of the project costs of any
55 nonprofit facility, including the refunding of any outstanding obligations,
1 mortgages or advances issued, made or given by any person for the project
2 costs of a nonprofit facility; and to charge and collect interest on the loans
3 for the loan payments upon such terms and conditions, including without limi-
4 tation bond rating and issuance conditions, as the board of commissioners con-
5 siders advisable which are not in conflict with this chapter.
6 ( bbaa) As security for the payment of the principal of and interest on any
7 revenue bonds issued and any agreements made in connection therewith, to mort-
8 gage, pledge, or otherwise encumber any or all of nonprofit facilities or any
9 part or parts thereof, whether then owned or thereafter acquired, and to
10 assign any mortgage and repledge any security conveyed to the association, to
11 secure any loan made by the association and to pledge the revenues and
12 receipts therefrom.
13 ( ccbb) To issue bonds for the purpose of financing all or part of the
14 project cost on any nonprofit facility and to secure the payment of the bonds
15 as provided in this chapter.
16 ( ddcc) To purchase or sell by installment contract or otherwise, and con-
17 vey all or any part of any nonprofit facility for such purchase price and upon
18 such terms and conditions as this board of commissioners considers advisable
19 which are not in conflict with this chapter.
20 ( eedd) To lease all or any part of any nonprofit facility for such rentals
21 and upon such terms and conditions, including options to purchase, as the
22 board of commissioners considers advisable and not in conflict with this chap-
24 ( ffee) To construct and maintain one (1) or more nonprofit facilities that
25 the association shall not operate any nonprofit facility as a business other
26 than as lessor, seller or lender. The purchase, holding and enforcing of mort-
27 gages, deeds of trust, or other security interests and contracting for any
28 servicing thereof is not considered the operation of a nonprofit facility as a
30 ( ggff) To act as the designated housing resource clearinghouse in the
31 state for matters relating to affordable housing.
32 ( hhgg) To coordinate the development and maintenance of a housing policy
33 for the state.
34 SECTION 2. That Section 67-6221, Idaho Code, be, and the same is hereby
35 amended to read as follows:
36 67-6221. CONFLICT OF INTEREST. Any member, commissioner, officer or
37 employee of the association who is interested either directly or indirectly,
38 or who is an officer or employee of, or has an ownership interest in any firm
39 or agency interested directly or indirectly in any contract with the associa-
40 tion, including any loan to any housing sponsor, shall disclose this dispose
41 of such interest to the association. This interest shall be set forth in the
42 minutes of the association, and the member, officer or employee having the
43 interest shall not participate before taking any action whatsoever on behalf
44 of the association, in the authorization of any such contract except that an
45 interest which is limited to a single family loan shall be allowed.
46 SECTION 3. That Section 67-6224A, Idaho Code, be, and the same is hereby
47 amended to read as follows:
48 67-6224A. LEGISLATIVE CONSTRUCTION. Neither this act nor anything herein
49 contained is or shall be construed as a restriction or limitation upon any
50 powers which the association might otherwise have under any laws of this
51 state, and this act is cumulative to any such powers. Provided however, that
1 the association shall have no power or authority under any law of this state
2 to organize a nonprofit corporation to assist the association in providing for
3 housing projects. This act does and shall be construed to provide a complete,
4 additional, and alternative method for the doing of the things authorized
5 thereby and shall be regarded as supplemental and additional to powers con-
6 ferred by other laws. However, the issuance of bonds, notes and other obliga-
7 tions and refunding bonds under the provisions of this act need not comply
8 with the requirements of any other state law applicable to the issuance of
9 bonds, notes and other obligations and contracts for the construction and
10 acquisition of any housing projects undertaken pursuant to this act and need
11 not comply with the provisions of any other state law applicable to contracts
12 for the construction and acquisition of state-owned property. No proceedings,
13 notice or approval shall be required for the issuance of any bonds, notes and
14 other obligations or any instrument as security therefor, except as is pro-
15 vided in this act.
16 SECTION 4. This act shall be in full force and effect on and after July
17 1, 2000.
STATEMENT OF PURPOSE
The Chairman of the Board of Commissioners of the Idaho Housing and
Finance Association (IHFA) and the Executive Director of IHFA are the
Chairman and President respectively of a private corporation called The Housing
Company (THC) and several private subsidiary corporations. THC and its
subsidiary corporations own and operate millions of dollars of worth of apartment
complexes throughout Idaho. Most of the financing, allocation and compliance of
millions of tax dollars to THC are as a result of applications to and allocation
from IHFA. All compliance and audit functions for millions of tax dollars on
THC properties are performed by IHFA.
Statues governing IHFA include a conflict of interest code provision, but
does not prohibit this type of activity. This legislation would not allow IHFA to
allocate millions of tax dollars to organizations run by its' officers and/or
employees by amending the conflict of interest section of IHFA statutes to
specifically disallow such activity. Additionally, this legislation would prevent
IHFA from establishing a non-profit corporation.
No fiscal impact.
Name: Representative Lenore Hardy Barrett
STATEMENT OF PURPOSE/FISCAL NOTE H 684