CHAPTER 134*
CONNECTICUT HOUSING FINANCE AUTHORITY ACT

      Sec. 8-241. Short title: Connecticut Housing Finance Authority Act. This chapter may be known and cited as the "Connecticut Housing Finance Authority Act".

      (1969, P.A. 795, S. 1; June, 1972, P.A. 1, S. 9.)

      History: 1972 act changed name from Connecticut Mortgage Authority Act to Connecticut Housing Finance Authority Act.

      Sec. 8-242. Declaration of policy. It is found and declared that there exists in the state and will exist in the future a serious shortage of housing for low and moderate income families and persons; that this shortage has contributed and will contribute to the persistence of slums and blight and will tend to perpetuate the concentration of families and persons of low and moderate income in the older urban areas of the state; and that this shortage has been a major contributing factor to the deterioration in the quality of environment and living conditions of large numbers of the citizens of Connecticut. It is further found and declared that it is imperative that the cost of mortgage financing, a major factor materially affecting the supply and cost of housing, be made lower in order to encourage the development and reduce the cost of housing for low and moderate income families and persons, that the supply of housing for families and persons displaced by public action or disaster be increased, and that private enterprise and public agencies be encouraged and assisted to build and rehabilitate well planned, well designed housing which will be made available to house families and persons of low and moderate income and will prevent the recurrence of slums and blight. It is further found and declared that there exists a serious lack of construction and permanent financing for housing proposed to be constructed, rehabilitated, purchased and refinanced pursuant to government-insured mortgage programs and with government subsidies for low and moderate income families and persons, and that this lack of construction and permanent financing will severely limit the growth in the supply of housing for such families and persons. It is further found and declared that there exists a serious shortage of low interest rate financing available to low and moderate income families and persons for the purchase or rehabilitation of existing dwelling units. It is therefore found and declared that providing state financial assistance for housing for low and moderate income families and persons through the making and purchase of mortgages on such housing located in this state and the undertaking of the other financing arrangements set forth in this chapter to meet the aforesaid needs and achieve the foregoing objectives, including mortgage loans to families and persons of low and moderate income for the purchase of existing dwelling units, are public purposes and purposes for which public money may be expended for the public benefit and good. It is further found and declared that in order to provide housing for families and persons of lower income than the Connecticut Housing Financing Authority can presently assist, it shall be a public purpose of the authority to invest a portion of its funds in mortgage or mortgage-backed securities at the maximum yield obtainable and to apply the income from such investments to reduce the interest rate charged on housing for low and moderate income persons and families and other mortgagees. It is further found and declared that municipalities in the state with a population in excess of seventy-five thousand or with population densities of three thousand five hundred per square mile of physically accessible land area as determined by or predicated upon the 1970 United States Census have, owing to their large size and long establishment as urban areas, urban problems that are not as pervasive nor of similar magnitude in municipalities of a smaller size and that this fact justifies limiting the provisions of subsection (34) of section 8-250, subsection (b) of section 8-251 and subdivision (4) of subsection (a) of section 8-258 to those municipalities of a population hereinbefore stated. It is further found and declared that there exists in such urban areas a critical and growing need to maintain and to encourage a proper balance of housing, industrial, commercial and community and recreational facilities and to restore urban areas as desirable places for persons of all income levels to live, work, shop and enjoy the amenities of town living and meeting, traditional to the state. It is recognized that a sufficient number of attractive sites for housing exist in the state elsewhere than in urban areas, that, during certain periods in recent times, private mortgage financing at acceptable rates has been and may continue to be more readily available elsewhere than in urban areas and that the superficial economics of housing elsewhere than in urban areas has been and will continue to be an incentive for citizens of the state to abandon their homes in urban areas or continue to live elsewhere; however, it is found and declared that the state has a major investment in insuring that urban areas do not further deteriorate because the cost (1) of accommodating continued development elsewhere than in urban areas, in terms of additional fire protection, sewer, water, education and energy requirements, of additional construction and maintenance of highways and transportation facilities, of the additional destruction of natural areas of the state, of the additional administrative and governmental requirements that result as underdeveloped areas grow in population and of such other similar public improvements and services that government is required to finance as a result thereof and (2) of redeveloping the urban areas, of the inefficient and underuse of the public facilities and services presently available in the urban areas and of the increased expense of providing safety for persons continuing to reside in deteriorating areas, is and will continue to be an undue burden on the state, adversely affecting the health, welfare, safety and general prosperity of the citizens of the state. It is further recognized that since the late nineteen-forties providing housing for low and moderate income persons and the redevelopment of urban areas has been the subject matter of government action and assistance in this state and that such action and assistance must continue; however, experience has shown that balanced community development has the best chance of improving the urban areas and that the proliferation of suburban sprawl is detrimental to the state, to its natural resources and to all of its inhabitants. It is further recognized that the conditions in certain parts of urban areas have caused the mortgage lenders to refuse to risk their capital on attractive housing even to persons able to afford such housing without assistance. It is further found, as more particularly set forth in the plan of conservation and development for Connecticut that the declared policy of the state is to discourage the development of areas which remain in their natural state and to encourage the further development and revitalization of the other areas of the state. It is therefore found and declared that in order to encourage the development of a balanced community of all income levels in the urban areas it is necessary and appropriate that mortgage financing for construction, reconstruction, purchase and refinancing of housing in urban areas for all levels of income more readily be made available. It is further found and declared that the erosion in the value of one, two or three-family homes due to the decline of economic conditions in the state has precluded the refinancing of mortgages on such property in a manner that could increase homeowner disposable income and contribute to the general economic recovery of the state and that it is beneficial and in the public interest that the state extend mortgage guarantees to mortgage lending institutions to provide refinancing mortgage loans when the decline of home values has precluded such lending. It is further found that energy costs of operating residential buildings have increased greatly in recent years creating a severe economic burden for families and persons of low and moderate income and making it difficult for such persons to afford basic housing needs; and that it is highly probable such energy costs will continue to increase rapidly in the future. It is therefore found and declared to be in the public interest and for the public benefit and good to protect Connecticut residents from further increases in energy costs by providing state financial assistance for the purchase, construction and installation in new and existing buildings of energy conservation measures and renewable energy systems providing space heating or cooling, domestic hot water, electricity or other useful energy. To achieve such purposes for the foregoing reasons, the General Assembly determines that the Connecticut Housing Finance Authority should be provided with the additional powers set forth in subsections (34) and (36) of section 8-250, subsection (b) of section 8-251 and subdivision (4) of subsection (a) of section 8-258 and that the expenditure of public moneys therefor constitutes a serving of a needed public purpose and is in the public interest. It is further found and declared that there continues to exist in the state and will exist in the future a serious shortage of housing; that federal programs providing subsidies for housing of low and moderate income persons and families are being curtailed or eliminated; that federal legislation has limited and restricted the ability of the Connecticut Housing Finance Authority to issue obligations, the interest on which is exempt from federal income taxation, to finance housing for low and moderate income persons and families and in urban areas; that it is imperative for the state to continue to create and maintain a climate conducive to attract investment in multifamily housing in the state and that the Connecticut Housing Finance Authority has demonstrated its capability for raising funds for such purpose. To achieve the purpose of continuing to attract such investment and to continue housing finance programs for shelter for its inhabitants, the General Assembly determines that the issuance of the obligations authorized pursuant to subsection (o) of section 8-252 and the expenditure of the proceeds thereof constitutes a serving of a needed public purpose and is in the public interest. It is further found and declared that the high cost of housing in the state, relative to the cost of housing in other states, is a significant impediment to the promotion and maintenance of economic development in the state and it is imperative that such competitive disadvantage be moderated to the extent possible through employer-assisted housing efforts or other means.

      (1969, P.A. 795, S. 2; 1972, P.A. 208, S. 1; P.A. 74-104, S. 1, 12; P.A. 75-465, S. 1, 7; P.A. 76-13, S. 1, 7; 76-118, S. 1, 6; 76-435, S. 18, 82; P.A. 79-578, S. 1, 3; P.A. 82-393, S. 1, 3; P.A. 83-587, S. 9, 96; P.A. 93-248, S. 1; 93-308, S. 1, 12; 93-435, S. 94, 95; P.A. 96-180, S. 9, 166.)

      History: 1972 act expanded policy statement to provide for lowering cost of mortgage financing and for encouragement of construction of housing units for low and moderate-income families; P.A. 74-104 added specific provision concerning low interest rate financing for purchase of existing dwellings; P.A. 75-465 added provision for use of investment income to finance housing for those "of lower income than the Connecticut housing finance authority can presently assist"; P.A. 76-13 included financing for rehabilitation of existing dwelling units; P.A. 76-118 greatly expanded section to include provisions specifically relating to urban municipalities; P.A. 76-435 made technical changes; P.A. 79-578 added provisions concerning financial assistance for energy conservation measures; P.A. 82-393 added language concerning the issuance of taxable obligations; P.A. 83-587 made technical changes; P.A. 93-248 added specific provision concerning employer-assisted housing; P.A. 93-308 added provision re residential mortgage refinancing guarantees, effective July 1, 1993; P.A. 93-435 changed effective date of P.A. 93-308 from July 1, 1993, to June 9, 1993, effective June 28, 1993; P.A. 96-180 made technical changes in references to Sec. 8-258, effective June 3, 1996.

      Broad provisions of statute cannot be interpreted to eliminate authority under Sec. 8-253a(1) to grant or withhold consent to prepayment of loan because an affordable housing developer may obtain a more favorable mortgage rate from a private lender. 281 C. 277.

      Sec. 8-242a. Establishment of subsidiaries by authority. It is found and declared that the purposes of the Connecticut Housing Finance Authority may from time to time best be fulfilled by permitting the authority to create certain subsidiaries to own, operate and manage properties providing housing for low and moderate income families and persons and to otherwise obtain financing for such properties. It is further found and declared that the creation of subsidiaries will assist in ensuring continued occupancy of authority financed developments by low and moderate income persons and families in accordance with the statutory purpose of the authority. It is further found and declared that in order for such subsidiaries to fulfill their purposes, liability will be limited solely to the assets and revenues or other resources of the subsidiary and without recourse liability to the Housing Mortgage General Fund or other reserve, insurance or designated funds or any other assets of the authority. It is further found and declared that expenditures of public moneys and exercise of limited borrowing powers by such subsidiaries may from time to time be necessary in order to rehabilitate or improve such housing development and otherwise fulfill the corporate purposes of the authority and that such expenditures of moneys and borrowing therefore constitutes a serving of a needed public purpose and is in the public interest.

      (P.A. 94-148, S. 1, 3.)

      History: P.A. 94-148 effective May 24, 1994.

      Sec. 8-243. Definitions. The following terms shall have the following meanings unless the context clearly indicates another meaning and intent:

      (a) "Act" means this chapter as amended from time to time;

      (b) "Authority" means the Connecticut Housing Finance Authority as created under section 8-244;

      (c) "Housing", "housing project" or "project" means a work or undertaking having as its primary purpose the provision of safe and adequate housing and related facilities for low and moderate income families and persons, and includes existing dwelling units for low and moderate income families and persons, notwithstanding that said housing provides other dwelling accommodations in addition to the primary purpose of providing dwelling accommodations for low and moderate income families and persons;

      (d) "Related facilities" means commercial, office, health, welfare, administrative, recreational, community and service facilities incidental and pertinent to housing as determined by the authority;

      (e) "Rents", "rentals" or "carrying charges" means the charges, excluding security deposits and down payments, paid for occupancy of housing financed or assisted under this chapter, whether such housing is owned or operated on a landlord-tenant or home ownership basis or as a condominium or a cooperative;

      (f) "Project cost" means the sum total of all costs incurred in the development of a housing project, which are approved by the authority as reasonable and necessary, including, but not limited to (1) costs of land acquisition and any buildings thereon; (2) costs of site preparation, demolition and development; (3) architectural, engineering, legal, authority and other fees and charges paid or payable in connection with the planning, execution and financing of the project; (4) cost of necessary studies, surveys, plans and permits; (5) insurance, interest, financing, tax and assessment costs and other operating and carrying costs during construction; (6) cost of construction or reconstruction, and fixtures and equipment related to such construction or reconstruction; (7) cost of land improvements; (8) necessary expenses in connection with the initial occupancy of the project; (9) a reasonable profit or fee to the builder and developer; (10) an allowance established by the authority for working capital, replacement and contingency reserves, and reserves for any anticipated operating deficits during the first two years of occupancy; (11) the cost of such other items, including tenant relocation, as the authority shall deem to be reasonable and necessary for the development of the project, less any and all net rents and other net revenues received from the operation of the real and personal property on the project site during construction;

      (g) "Development costs" means the costs approved by the authority as appropriate expenditures which may be incurred prior to initial disbursement of mortgage loan proceeds, including, but not limited to: (1) Payments for options to purchase properties for the proposed project, deposits on contracts of purchase or, with the prior approval of the authority, payments for the purchase of such properties; (2) legal, organizational and marketing expenses, including payment of attorneys' and consultants' fees, project management and clerical staff salaries, office rent and other incidental expenses; (3) payment of fees for preliminary feasibility studies and advances for planning, architectural and engineering work and land surveys and soil tests; (4) expenses of surveys as to need and market analyses; (5) necessary application and other fees to federal, state and local government agencies; and (6) such other expenses as the authority may deem appropriate to effectuate the purposes of this chapter;

      (h) "Low and moderate income families and persons" means families and persons who lack the amount of income necessary as determined by the authority, to rent or purchase safe and adequate housing without special financial assistance not reasonably available. The income limits for the admission of such families and persons to housing built or financed or assisted under this chapter shall be established by this authority;

      (i) "Assisted mortgage financing" means a below market interest rate mortgage insured or purchased, or a loan made, by the Secretary of the United States Department of Housing and Urban Development; a market interest rate mortgage insured or purchased, or a loan made, in combination with, or as augmented by, a program of rent supplements, interest subsidies or interest reduction payments, leasing, contributions or grants, or other programs now or hereafter authorized by federal law to serve low and moderate income families and persons; a mortgage loan made or insured pursuant to this chapter; or any combination of such loans, mortgage insurance or other assistance;

      (j) "Mortgage" means a mortgage deed, deed of trust, or other instrument which shall constitute a lien, whether first or second, on real estate or on a leasehold under a lease having a remaining term, at the time such mortgage is acquired, which does not expire for at least that number of years beyond the maturity date of the obligation secured by such mortgage as is equal to the number of years remaining until the maturity date of such obligation. As used in this subsection, a lease of a lot in a mobile manufactured home park which is indefinitely renewable pursuant to subsection (b) of section 21-70 shall satisfy the leasehold requirement, provided such lease is acceptable to a third party mortgage insurer and the authority receives an acceptable mortgage insurance policy;

      (k) "First mortgage" means such classes of first liens as are commonly given to secure loans on, or the unpaid purchase price of, real estate under the laws of the state, together with appropriate credit instruments;

      (l) "Mortgagee" means the original lender under the mortgage or participants therein, and their successors and assigns;

      (m) "Mortgagor" or "eligible mortgagor" means (1) a nonprofit corporation incorporated pursuant to chapter 602 or any predecessor statutes thereto, having as one of its purposes the construction, rehabilitation, ownership or operation of housing, and having articles of incorporation approved by the authority in accordance with the provisions of this chapter; (2) any business corporation incorporated pursuant to chapter 601 or any predecessor statutes thereto, having as one of its purposes the construction, rehabilitation, ownership or operation of housing, and having articles of incorporation approved by the authority in accordance with the provisions of this chapter; (3) any partnership, limited partnership, joint venture, trust or association having as one of its purposes the construction, rehabilitation, ownership or operation of housing, and having basic documents of organization approved by the authority in accordance with the provisions of this chapter; (4) a housing authority established pursuant to chapter 128; (5) a family or person approved by the authority as qualified to own, construct, rehabilitate, manage and maintain housing under a mortgage loan made or insured by the authority under the provisions of this chapter; or (6) a municipal developer; and includes the successors and assigns of the mortgagor;

      (n) "Mortgage payments" means periodic payments called for by a mortgage, and may include, but is not limited to, interest, installments of principal, taxes and assessments, mortgage insurance premiums and hazard insurance premiums;

      (o) "Aggregate family income" means the total family income of all members of a family, from whatever source derived, including but not limited to pension, annuity, retirement and social security benefits, provided there may be excluded from income, as the authority by regulation may determine, (1) reasonable allowances for dependents, (2) reasonable allowances for medical expenses, (3) all or any proportionate part of the earnings of gainfully employed minors or family members other than the chief wage earner, (4) income not received regularly and (5) other expenses;

      (p) "Earned surplus" shall have the same meaning as in generally accepted accounting standards;

      (q) "Municipality" means any city, town or borough in the state;

      (r) "Lending institution" means any bank, trust company, savings bank, savings and loan association or credit union, whether chartered by the United States of America or this state, and any insurance company authorized to do business in this state, and any mortgage banking firm approved by the authority;

      (s) "Tenant" means the occupant of any housing financed or assisted by the authority under this chapter;

      (t) "Second mortgage" means any class of second liens ranking immediately after a first mortgage on the same property, without any intervening liens, as are commonly given to secure loans on real estate, or the unpaid purchase price of real estate under the laws of the state, together with appropriate credit instruments, provided such second mortgage, unless granted pursuant to the exercise of powers granted to the authority under the provisions of the general statutes, is insured by an agency of the federal government or by such other entity as the authority shall determine is financially able to insure or guarantee repayment in the event of default by the mortgagor;

      (u) "Person" means any person, including individuals, limited liability companies, firms, partnerships, associations, public or private, organized or existing under the laws of the state or, any other state if qualified to do business in the state;

      (v) "Urban area" means any targeted area, as defined in Section 143 of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as from time to time amended;

      (w) "Urban area mortgage" means a mortgage securing a construction or a permanent loan to any person for the purpose of purchasing, refinancing, constructing or rehabilitating any residential building in an urban area, including related facilities, such as commercial, offices, health, welfare, administration, recreational, community and service facilities incidental and pertinent thereto as determined by the authority, but need not be a first lien upon the mortgaged property;

      (x) "Municipal developer" means a municipality, as defined in subsection (q) of this section, which has not declared by resolution a need for a housing authority pursuant to section 8-40, acting by and through its legislative body, except that in any town in which a town meeting or representative town meeting is the legislative body, "municipal developer" means the board of selectmen if such board is authorized to act as the municipal developer by the town meeting or representative town meeting;

      (y) "Employer-assisted housing" means (1) housing that is, in whole or in part, owned, acquired, developed or managed by employers, or on behalf of employers, for the benefit of employees in the state or (2) assistance offered by employers to employees in the purchase or lease of residential property in the state;

      (z) "Department" means the Department of Economic and Community Development.

      (1969, P.A. 795, S. 3; 1972, P.A. 208, S. 2; P.A. 74-104, S. 2-4, 12; P.A. 76-118, S. 2, 6; P.A. 87-436, S. 15, 23; P.A. 93-248, S. 3; P.A. 94-125, S. 2.; P.A. 95-79, S. 15, 189; 95-250, S. 8, 42; 95-309, S. 11, 12; P.A. 96-256, S. 178, 209; 96-271, S. 152, 254; P.A. 97-222.)

      History: 1972 act redefined "housing", "related facilities", "low and moderate-income families and persons" and "mortgagor" and defined "'rents', `rentals' or `carrying charges'", "project cost", "development costs", "assisted mortgage financing", "aggregate family income", "earned surplus", "municipality", "lending institution" and "tenant"; P.A. 74-104 redefined "housing" to specifically include existing dwelling units, redefined "mortgage" to include first and second liens and to delete phrase "in fee simple" and defined "second mortgage"; P.A. 76-118 defined "person", "urban area" and "urban area mortgage"; P.A. 87-436 redefined "mortgagor" or "eligible mortgagor" in Subdiv. (m) to include municipal developers and added Subdiv. (x) defining "municipal developer"; P.A. 93-248 defined "employer-assisted housing"; P.A. 94-125 amended Subdiv. (j) by adding provision that a lease of a lot in a mobile manufactured home park which is indefinitely renewable shall satisfy the leasehold requirement; P.A. 95-79 redefined "person" to include a limited liability company, effective May 31, 1995; P.A. 95-250 redefined "second mortgage" by adding provision re second mortgages granted pursuant to the authority of the general statutes and added definition of "department"; P.A. 95-309 changed effective date of P.A. 95-250 but did not affect this section; P.A. 96-256 and P.A. 96-271 amended the definitions of "mortgagor" or "eligible mortgagor" in Subdiv. (m) by replacing reference to "chapter 600" with "chapter 602 or any predecessor statutes thereto" and "chapter 599" with "chapter 601 or any predecessor statutes thereto", respectively, effective January 1, 1997; P.A. 97-222 redefined "urban area" in Subdiv. (v) to mean any targeted area, as defined in Section 143 of the Internal Revenue Code of 1986, as amended.

      Sec. 8-244. Connecticut Housing Finance Authority deemed a public instrumentality and political subdivision. Board membership. Subsidiaries. (a) There is created a body politic and corporate to be known as the "Connecticut Housing Finance Authority". Said authority is constituted a public instrumentality and political subdivision of this state and the exercise by the authority of the powers conferred by this chapter shall be deemed and held to be the performance of an essential public and governmental function. The Connecticut Housing Finance Authority shall not be construed to be a department, institution or agency of the state. The board of directors of the authority shall consist of fifteen members as follows: (1) The Commissioner of Economic and Community Development, the Secretary of the Office of Policy and Management, the Banking Commissioner and the State Treasurer, ex officio, with the right to vote, (2) seven members to be appointed by the Governor, and (3) four members appointed as follows: One by the president pro tempore of the Senate, one by the speaker of the House of Representatives, one by the minority leader of the Senate and one by the minority leader of the House of Representatives. The member initially appointed by the speaker of the House of Representatives shall serve a term of five years; the member initially appointed by the president pro tempore of the Senate shall serve a term of four years. The members initially appointed by the Senate minority leader shall serve a term of three years. The member initially appointed by the minority leader of the House of Representatives shall serve a term of two years. Thereafter, each member appointed by a member of the General Assembly shall serve a term of five years. The members appointed by the Governor and the members of the General Assembly shall be appointed in accordance with section 4-9b and among them be experienced in all aspects of housing, including housing design, development, finance, management and state and municipal finance, and at least one of whom shall be selected from among the officers or employees of the state. At least one shall have experience in the provision of housing to very low, low and moderate income families. On or before July first, annually, the Governor shall appoint a member for a term of five years from said July first to succeed the member whose term expires and until such member's successor has been appointed, except that in 1974 and 1995 and quinquennially thereafter, the Governor shall appoint two members. The chairperson of the board shall be appointed by the Governor, with the advice and consent of both houses of the General Assembly. The board shall annually elect one of its appointed members as vice-chairperson of the board. Members shall receive no compensation for the performance of their duties hereunder but shall be reimbursed for necessary expenses incurred in the performance thereof. The Governor or appointing member of the General Assembly, as the case may be, shall fill any vacancy for the unexpired term. A member of the board shall be eligible for reappointment. Any member of the board may be removed by the Governor or appointing member of the General Assembly, as the case may be, for misfeasance, malfeasance or wilful neglect of duty. Each member of the board before entering upon such member's duties shall take and subscribe the oath of affirmation required by article XI, section 1, of the State Constitution. A record of each such oath shall be filed in the office of the Secretary of the State. Each ex-officio member may designate such member's deputy or any member of such member's staff to represent such member at meetings of the board with full power to act and vote on such member's behalf.

      (b) Notwithstanding the provisions of any other law to the contrary, it shall not constitute a conflict of interest for a trustee, director, partner or officer of any person, firm or corporation, or any individual having a financial interest in a person, firm or corporation, to serve as a member of the authority, provided such trustee, director, partner, officer or individual shall abstain from deliberation, action or vote by the authority in specific respect to such person, firm or corporation.

      (c) (1) The authority may incorporate one or more subsidiaries and may transfer to any subsidiary any moneys, real or personal property, of any housing financed by a mortgage of the authority or by the Connecticut Housing Authority and acquired as a result of a foreclosure or otherwise. Each subsidiary shall have all the privileges, immunities, tax exemptions and other exemptions of the authority, except the privileges, immunities, tax exemptions and other exemptions provided under the general statutes for special capital reserve funds. Each subsidiary shall be subject to suit and liability solely from the assets, revenues and resources of the subsidiary and without recourse to the general funds, revenues, resources or any other assets of the authority. Each such subsidiary is authorized to assume or take title to housing subject to any existing mortgage and to mortgage, convey or dispose of its assets and pledge its revenues in order to secure any borrowing, for the purpose of refinancing, rehabilitating or improving its assets, provided each such borrowing or mortgage shall be a special obligation of the subsidiary, which obligation may be in the form of bonds, bond anticipation notes and other obligations to the extent permitted under this chapter, to fund and refund the same and provide for the rights of holders thereof, and to secure the same by pledge of revenues, notes and mortgages of others, and which shall be payable solely from the assets, revenues and other resources of the subsidiary and provided further no such mortgage, borrowing or pledge of security eliminates requirements relating to housing that preserve housing for persons and families of low and moderate income without the express written consent of the authority. Such borrowing shall be in accordance with subsections (b) to (m), inclusive, of section 8-252, provided no such subsidiary shall be entitled to borrow for any purpose except with respect to property transferred to such subsidiary by the authority specified in subsection (a) of said section 8-252.

      (2) Each subsidiary shall have a board of directors and at least one-half of the board of directors of each subsidiary shall be members of the board of directors of the authority, or their designees or officers or employees of the authority. A resolution of the authority shall prescribe the purposes for which each subsidiary is to be formed.

      (3) The provisions of subsection (b) of this section and sections 8-245, 8-247 and 1-125 shall apply to any officer, director, designee or employee appointed as a member, director or officer of any such subsidiary. Any such persons so appointed shall not be personally liable for the debts, obligations or liabilities of any such subsidiary provided in section 1-125. The subsidiary shall and the authority may provide the indemnification to protect, save harmless and indemnify such officer, director, designee or employee as provided by said section 1-125.

      (4) The authority or subsidiary shall take such actions to comply with the provisions of the Internal Revenue Code of 1986 or any subsequent corresponding internal revenue code of the United States, as from time to time amended, to qualify and maintain any such subsidiary as a corporation exempt from taxation under said Internal Revenue Code.

      (5) The authority is permitted to make housing mortgage loans to each such subsidiary, following standard authority procedures, from the proceeds of its bonds, notes and other obligations provided the source and security for the repayment of such mortgage loans is derived from the assets, revenues and resources of the subsidiary and without recourse to the general funds, revenues and resources pledged under its general housing mortgage finance program bond resolution.

      (1969, P.A. 795, S. 4; 1971, P.A. 840, S. 1; 1972, P.A. 208, S. 3; P.A. 73-679, S. 36, 43; P.A. 74-104, S. 5, 12; P.A. 76-41, S. 1, 3; P.A. 77-614, S. 19, 161, 593(b), 610; P.A. 79-598, S. 22; P.A. 80-482, S. 3, 345, 348; P.A. 87-9, S. 2, 3; P.A. 88-225, S. 7, 14; 88-266, S. 4, 46; P.A. 94-148, S. 2, 3; P.A. 95-250, S. 1, 24, 42; 95-309, S. 11, 12; P.A. 96-211, S. 1, 5, 6; P.A. 03-84, S. 8.)

      History: 1971 act deleted provisions for first appointments and allowed treasurer to designate deputy or staff member to represent him at authority meetings; 1972 act substituted Housing Finance Authority for Mortgage Authority, made designated state officers ex-officio members and replaced specific membership requirements re housing finance expertise and state and municipal finance expertise with general provision that members be experienced in "all aspects of housing design, development, finance" etc., (but not applicable to "membership as it exists on May 18, 1972"), required that chairman and vice chairman be selected from appointed members and replaced specific provisions allowing treasurer and commissioner of finance and control to designate stand-ins with provision allowing all ex-officio members to do so; P.A. 73-679 removed director of budget as member of authority; P.A. 74-104 changed number of appointed members from five to six, added provisions concerning members selected from officers or employees of state and deleted reference to membership in existence on May 18, 1972; P.A. 76-41 included bank commissioner as ex-officio member; P.A. 77-614 substituted secretary of the office of policy and management for commissioner of finance and control and, effective January 1, 1979, substituted banking commissioner for bank commissioner and made banking department a division within the department of business regulation and substituted commissioner of economic development for commissioner of community affairs; P.A. 79-598 substituted commissioner of housing for commissioner of economic development; P.A. 80-482 restored banking division as an independent department, retaining commissioner as its head; (Revisor's note: Pursuant to P.A. 87-9, "banking commissioner" was changed by the Revisors to "commissioner of banking"); P.A. 88-225 added Subsec. (b) re when a financial interest and membership on the authority do not constitute a conflict of interest; P.A. 88-266 inserted reference to governmental function, specified that authority is not a department, institution or agency of the state, repealed requirements that governor's appointments be made with advice and consent of senate and that one of governor's appointees be a state officer or employee, required chairperson to be appointed by governor with advice and consent of general assembly, instead of by authority members, and established board of directors as governing body of the authority; P.A. 94-148 added Subsec. (c) regarding establishment of subsidiaries, effective May 24, 1994; P.A. 95-250 amended Subsec. (a) to increase the size of the board from 10 to 15 members, adding one gubernatorial appointee and four by General Assembly, requiring that one of the members appointed by the Governor have experience in providing housing for very low, low and moderate income families and, with P.A. 96-211, replacing the Housing Commissioner with the Commissioner of Economic and Community Development and amended Subsec. (c)(1) to transfer to subsidiaries housing financed by the Connecticut Housing Authority and provide that subsidiaries have the privileges, immunities and exemptions of the authority except those provided for special capital reserve funds, effective July 1, 1995; P.A. 95-309 changed effective date of P.A. 95-250 but did not affect this section; P.A. 03-84 amended Subsec. (a) by changing "Commissioner of Banking" to "Banking Commissioner" and making technical changes for the purposes of gender neutrality, effective June 3, 2003.

      See chapter 127c (Sec. 8-37r et seq.) re housing functions of Department of Economic and Community Development.

      See Sec. 8-37uu re transfer of housing loan portfolio of Department of Economic and Community Development to authority.

      Cited. 184 C. 311.

      Sec. 8-244a. Commissioner of Economic Development to be member of authority. Section 8-244a is repealed.

      (P.A. 77-614, S. 587, 593, 610; P.A. 78-303, S. 85, 136; P.A. 79-598, S. 25; 79-631, S. 109, 111.)

      Sec. 8-244b. Establishment of State Housing Authority. (a) The Connecticut Housing Finance Authority shall establish a subsidiary to be known as the State Housing Authority. The SHA shall be the successor to the Connecticut Housing Authority. The powers of the SHA shall be vested in and exercised by a board of directors, which shall consist of three members to be appointed by the board of directors of the Connecticut Housing Finance Authority. One such member of the board of directors of the SHA shall be an officer or employee of the Connecticut Housing Finance Authority, and two such members of the board of directors of the SHA shall be members of the board of directors of the Connecticut Housing Finance Authority. Any vacancy on the board of directors of the SHA shall be filled by the board of directors of the Connecticut Housing Finance Authority. The chairperson of the board of directors of the SHA shall be appointed by the board of directors of the Connecticut Housing Finance Authority. Action may only be taken by the SHA by a majority vote of the members of the board of directors thereof. Members of the board of directors of the SHA shall receive no compensation for the performance of their duties under this section but shall be reimbursed for necessary expenses incurred in the performance thereof. A member of the board of directors of the SHA shall be eligible for reappointment. Any member of the board of directors of the SHA may be removed by a majority vote of the board of directors of the Connecticut Housing Finance Authority for misfeasance, malfeasance or wilful neglect of duty. Each member of the board of directors of the SHA before entering upon his duties shall take and subscribe the oath of affirmation required by article XI, section 1, of the state Constitution. A record of each such oath shall be filed in the office of the Secretary of the State. In the event a member of the board of directors of the SHA is an ex-officio director of the Connecticut Housing Finance Authority, then such director may designate his deputy or any member of his staff to represent him at meetings of the board with full power to act and vote on his behalf.

      (b) Notwithstanding the provisions of any other law, no officer or employee of this state shall be deemed to have forfeited or shall forfeit his office or employment by reason of his acceptance of membership on the board of directors of the SHA or his services thereon.

      (P.A. 95-250, S. 4, 42; 95-309, S. 11, 12.)

      History: P.A. 95-309 changed effective date of P.A. 95-250 but did not affect this section.

      See Sec. 8-121(e) re limited continuing function of Connecticut Housing Authority.

      See Sec. 32-1k for definitions.

      Sec. 8-244c. State Housing Authority to be successor to Connecticut Housing Authority. Upon the establishment of the State Housing Authority and the filing of the certificate of incorporation therefor with the Secretary of the State, the SHA shall constitute the successor to the Connecticut Housing Authority. The terms of the present members of the board of directors of the Connecticut Housing Authority shall expire upon the appointment of a board of directors pursuant to section 8-244b, and upon such expiration, all functions, powers and duties now vested in the Connecticut Housing Authority or the board of directors thereof shall be deemed to be transferred to and assumed by the SHA and the board of directors thereof. Each director of the SHA shall serve for a term as shall be determined by the board of directors of the Connecticut Housing Finance Authority.

      (P.A. 95-250, S. 5, 42; 95-309, S. 11, 12.)

      History: P.A. 95-309 changed effective date of P.A. 95-250 but did not affect this section.

      See Sec. 32-1k for definitions.

      Sec. 8-244d. Bonds, notes or other obligations. All notes, bonds or other obligations issued by the Connecticut Housing Authority for the financing of any project or projects shall be in accordance with their terms of full force and effect and valid and binding upon the State Housing Authority as the successor to the Connecticut Housing Authority and with respect to any resolution, contract, deed, trust agreement, mortgage, conditional sale or loan agreement, commitment, obligation or liability or other such document, public record, right, remedy, special act or public act, obligation, liability or responsibility pertaining thereto, the State Housing Authority shall be, and shall be deemed to be, the successor to the Connecticut Housing Authority. All properties, rights in land, buildings and equipment and any funds, moneys, revenues and receipts or assets of the Connecticut Housing Authority pledged or otherwise securing any such notes, bonds or other obligations shall belong to the subsidiary as successor to the Connecticut Housing Authority, subject to such pledges and other security arrangements and to agreements with the holders of the outstanding notes, bonds or other obligations. Any resolution with respect to the issuance of bonds of the Connecticut Housing Authority for the purposes of the Connecticut Housing Authority Act, created under chapter 129, and any other action taken by the Connecticut Housing Authority with respect to assisting in the financing of any project shall be, or shall be deemed to be, a resolution of the State Housing Authority or an action taken by the State Housing Authority subject only to any agreements with the holders of outstanding notes, bonds, or other obligations of the Connecticut Housing Authority. Whenever, in any law, rule, regulation, order, contract, document, judicial or administrative proceeding or otherwise, reference is made to the Connecticut Housing Authority, the same shall mean and refer to the subsidiary to be established by the Connecticut Housing Finance Authority pursuant to section 8-244b.

      (P.A. 95-250, S. 6, 42; 95-309, S. 11, 12.)

      History: P.A. 95-309 changed effective date of P.A. 95-250 but did not affect this section.

      See Sec. 32-1k for definitions.

      Sec. 8-245. State personnel may be board members of authority. Notwithstanding the provisions of any other law, no officer or employee of this state shall be deemed to have forfeited or shall forfeit his office or employment by reason of his acceptance of membership on the board of directors of the authority or his service thereon.

      (1969, P.A. 795, S. 9; P.A. 88-266, S. 5, 46.)

      History: P.A. 88-266 added reference to "board of directors".

      Sec. 8-246. Executive director. Appointment and duties. The board of directors of the authority shall appoint an executive director who shall not be a member of the board and who shall serve at the pleasure of the board and receive such compensation as shall be fixed by the board. He shall be the chief administrative officer of the authority and shall direct and supervise administrative affairs and technical activities in accordance with the directives of the board. He shall approve all accounts for salaries, allowable expenses of the authority or of any employee or consultant thereof, and expenses incidental to the operation of the authority. He shall perform such other duties as may be directed by the board in carrying out the purposes of this chapter. The executive director and all other employees of the authority shall be exempt from the classified service. The executive director shall attend all meetings of the board, keep a record of the proceedings of the authority and shall maintain and be custodian of all books, documents and papers filed with the authority and of the minute book or journal of the authority and of its official seal. He may cause copies to be made of all minutes and other records and documents of the authority and may give certificates under the official seal of the authority to the effect that such copies are true copies, and all persons dealing with the authority may rely upon such certificates.

      (1969, P.A. 795, S. 8; 1972, P.A. 208, S. 4; P.A. 88-266, S. 6, 46.)

      History: 1972 act replaced provision that designated executive personnel be exempt from classified service with provision that all employees of authority be exempt from classified service; P.A. 88-266 substituted references to "board of directors" for references to authority throughout section.

      Sec. 8-247. Bonds of board members and executive director of authority. Each member of the board of directors of the authority shall execute a surety bond in the penal sum of fifty thousand dollars and the executive director shall execute a surety bond in the penal sum of one hundred thousand dollars, or, in lieu thereof, the chairman of the board shall execute a blanket position bond covering each member, the executive director and the employees of the authority, each surety bond to be conditioned upon the faithful performance of the duties of the office or offices covered, to be executed by a surety company authorized to transact business in this state as surety and to be approved by the Attorney General and filed in the office of the Secretary of the State. The cost of each such bond shall be paid by the authority.

      (1969, P.A. 795, S. 5; P.A. 88-266, S. 7, 46.)

      History: P.A. 88-266 replaced references to the authority with references to the board of directors where appearing.

      Sec. 8-248. Perpetual succession of authority. The authority shall have perpetual succession as constituted in section 8-244 and shall adopt procedures for the conduct of its affairs in accordance with the provisions of section 1-121, provided regulation-making proceedings commenced before January 1, 1989, shall be governed by chapter 54. Such succession shall continue until the existence of the authority is terminated by law, but no such law shall take effect as long as the authority shall have bonds, notes or other obligations outstanding. Upon termination of the authority, its rights and properties shall pass to the state.

      (1969, P.A. 795, S. 6; P.A. 79-332; P.A. 88-266, S. 8, 46; P.A. 06-196, S. 47.)

      History: P.A. 79-332 substituted "chapter 54" for "sections 4-41 to 4-50, inclusive"; P.A. 88-266 required adoption of procedures rather than the adoption, amendment and repeal of regulations but specified that regulation-making proceedings commencing before January 1, 1989, are to be governed by chapter 54; P.A. 06-196 made a technical change, effective June 7, 2006.

      This section requires Connecticut Housing Finance Authority to adopt regulations in accordance with the Uniform Administrative Procedure Act. 184 C. 311.

      Sec. 8-249. Quorum. Board action. Written procedures. (a) The powers of the authority shall be vested in and exercised by not less than five of the members of the board of directors then in office. Such number of members shall constitute a quorum and the affirmative vote of a majority of the members present at a meeting of the board shall be necessary for any action taken by the authority. No vacancy in the membership of the board shall impair the right of a quorum to exercise all the rights and perform all the duties of the authority. Any action taken by the board, under the provisions of this chapter may be authorized by resolution at any regular or special meeting, and each such resolution shall take effect immediately and need not be published or posted.

      (b) The board of directors of the authority may delegate to three or more of its members such board powers and duties as it may deem proper. At least one of such members shall not be a state employee.

      (c) The board of directors of the authority shall adopt written procedures, in accordance with the provisions of section 1-121, for: (1) Adopting an annual budget and plan of operations, including a requirement of board approval before the budget or plan may take effect; (2) hiring, dismissing, promoting and compensating employees of the authority, including an affirmative action policy and a requirement of board approval before a position may be created or a vacancy filled; (3) acquiring real and personal property and personal services, including a requirement of board approval for any nonbudgeted expenditure in excess of five thousand dollars; (4) contracting for financial, legal, bond underwriting and other professional services, including a requirement that the authority solicit proposals at least once every three years for each such service which it uses; (5) issuing and retiring bonds, bond anticipation notes and other obligations of the authority; (6) awarding loans, grants and other financial assistance, including eligibility criteria, the application process and the role played by the authority's staff and board of directors; and (7) the use of surplus funds to the extent authorized under this chapter or other provisions of the general statutes.

      (1969, P.A. 795, S. 7; P.A. 88-266, S. 9, 46.)

      History: P.A. 88-266 divided existing Sec. into Subsecs. (a) and (b), amended Subsec. (a) to establish board of directors as governing body of the authority, amended Subsec. (b) to authorize board to delegate powers and duties to three or more of its members, at least one of whom shall not be a state employee, instead of to one or more of its members or its officers, agents and employees and added Subsec. (c) re adoption of procedures for certain powers exercised by board.

      Sec. 8-250. Purpose and powers of authority. The purpose of the authority shall be to alleviate the shortage of housing for low and moderate income families and persons in this state and, when appropriate, to promote or maintain the economic development of this state through employer-assisted housing efforts and for such purposes the authority shall have the following powers:

      (1) To have perpetual succession as a body politic and corporate and to adopt and from time to time amend and repeal bylaws, policies and procedures for the regulations of its affairs and the conduct of its business;

      (2) To invest in, purchase, acquire and take assignments from mortgagees of notes and mortgages evidencing loans for the construction, rehabilitation, purchase, leasing or refinancing of housing;

      (3) To receive and accept aid or contributions from any source of money, property, labor or other things of value, to be held, used and applied to carry out the purposes of this chapter subject to such conditions upon which such grants and contributions may be made, including, but not limited to, gifts or grants from any department, agency or instrumentality of the United States or this state for any purpose consistent with this chapter;

      (4) To enter into agreements with any department, agency or instrumentality of the United States or this state and with prospective mortgagees and mortgagors for the purpose of planning and regulating and providing for the financing and refinancing, construction or rehabilitation, leasing, management and disposition of any housing undertaken with the assistance of the authority under this chapter;

      (5) To acquire or contract to acquire, by purchase, grant, foreclosure or otherwise, leaseholds, fees and other interests in real property, in the state of Connecticut; to take assignments of leases and rentals; to own, hold, clear, improve and rehabilitate and to sell, assign, exchange, transfer, convey, lease, mortgage or otherwise dispose of or encumber such property on any terms, including purchase money mortgages;

      (6) To promote and encourage private sponsorship of the construction and rehabilitation of adequate housing for low and moderate income families and persons in this state;

      (7) To encourage the individual ownership of homes and the ownership of individual shares of or memberships in cooperative housing by low and moderate income families and persons in this state;

      (8) To stimulate environmental planning for housing for low and moderate income families and persons in order to enhance opportunities of such persons for self-development and employment;

      (9) To encourage governmental agencies and others to participate and assist in overcoming the lack of adequate housing for low and moderate income families and persons in this state;

      (10) To make mortgage loans and to participate with any department, agency or instrumentality of the United States or this state, or any lending institution, foundation, labor union, investment trust, educational institution, or fiduciary in a loan to an eligible mortgagor secured by a single participation mortgage or by separate mortgages, the interest of each having equal priority as to lien in proportion to the amount of the loan so secured, but not necessarily equal as to interest rate, time or rate of amortization or otherwise; to undertake commitments to make mortgage loans; to sell mortgages at public or private sale, with or without bidding; to foreclose on any mortgage or commence any action to protect or enforce any right conferred upon it by law, mortgage, contract or other agreement, and to bid for and purchase property which was the subject of such mortgage, at any foreclosure or at any other sale; to release or relinquish any right, title, claim, interest or demand, however acquired, including any equity or right of redemption, in property foreclosed by it; to acquire and take possession of any such property, and in such event to complete, administer, pay the principal and interest or any obligation incurred in connection with such property, dispose of, and otherwise deal with, such property in such manner as may be necessary or desirable to protect the interests of the authority therein;

      (11) To the extent permitted under this chapter, to borrow money or secure credit on a temporary, short-term, interim or long-term basis;

      (12) To issue bonds, bond anticipation notes and other obligations of the authority to the extent permitted under this chapter, to fund and refund the same and provide for the rights of the holders thereof; and to secure the same by pledge of revenues, notes and mortgages of others;

      (13) To acquire, lease, hold and dispose of personal property for its corporate purposes;

      (14) To fix and collect fees and charges in connection with its loans, applications for loans, commitments, mortgage insurance and purchase of mortgages, including, but not limited to, reimbursement of costs of financing by the authority, service charges and insurance premiums as the authority shall determine to be reasonable and as shall be approved by the authority;

      (15) To employ such assistants, agents and other employees and to engage consultants and such other independent professionals as may be necessary or desirable to carry out its purposes in accordance with this chapter and to fix their compensation; and to provide technical assistance to eligible mortgagors as provided in this chapter;

      (16) To make and enter into all contracts and agreements necessary or incidental to the performance of its duties and the execution of its powers under this chapter, including contracts or agreements with qualified financial institutions for the servicing and processing of mortgage loans pursuant to this chapter;

      (17) To sue and be sued, plead and be impleaded, provided nothing in section 8-244 or 8-253 shall be so construed as to permit an attachment of or garnishment against any of the funds or assets of the authority prior to final judgment, adopt a seal and alter the same at pleasure, and maintain an office at such place or places within the state as it may designate;

      (18) To invest any funds not needed for immediate use or disbursement, including any funds held in reserve, in obligations issued or guaranteed by the United States of America or the state of Connecticut and in other obligations which are legal investments for savings banks in this state and in time deposits or certificates of deposit or other similar banking arrangements secured in such manner as the authority determines;

      (19) To procure insurance against any loss in connection with its property and other assets, including mortgages and mortgage loans, in such amounts and from such insurers as it deems desirable;

      (20) To the extent permitted under its contract with the holders of bonds, bond anticipation notes and other obligations of the authority, to consent to any modification with respect to rate of interest, time and payment of any installment of principal or interest, security or any other term of any mortgage, mortgage loan, mortgage loan commitment, contract or agreement of any kind to which the authority is a party;

      (21) To the extent permitted under its contract with the holders of bonds, bond anticipation notes and other obligations, to enter into contracts with any mortgagor containing provisions enabling such mortgagor to reduce the rental or carrying charges to families of persons unable to pay the regular schedule of charges where, by reason of other income or payment from any department, agency or instrumentality of the United States or this state, such reductions can be made without jeopardizing the economic stability of housing being financed;

      (22) Where by reason of the financing plan a review of the application for financing the proposed housing is required by or on behalf of any department, agency or instrumentality of the United States or this state, to provide, contract or arrange for consolidated processing of any such application to avoid duplication thereof by either undertaking the processing in whole or in part for any such department, agency or instrumentality or, in the alternative, delegating the processing in whole or in part to any such department, agency or instrumentality;

      (23) To sell, at public or private sale, with or without bidding, any mortgage or other obligation held by the authority;

      (24) To insure mortgage payments of any mortgage loan made for the purpose of constructing, rehabilitating, purchasing, leasing, or refinancing housing, upon such terms and conditions as the authority may prescribe;

      (25) To enter into mortgage insurance agreements with lending institutions in connection with the lending of money by such institutions for the purchase of housing;

      (26) To make advances to nonprofit corporations, including community housing development corporations meeting the requirements of section 8-217, and to municipal developers for the expenses of planning and developing housing for which such nonprofit corporation or municipal developer has applied for a mortgage loan or mortgage insurance from the authority under the provisions of this chapter. The authority may make such advances after it has determined that the proposed housing complies with the standards established by the authority under this chapter, in an amount not to exceed ninety-five per cent of the reasonable development costs expected to be incurred by the applicant in connection with the planning and developing of such housing prior to the availability of financing for the construction, rehabilitation or acquisition thereof. The proceeds of the advance may be used only to defray the development costs of such housing. Each advance shall be repaid in full by the recipient thereof upon initial disbursement of the construction loan financing such housing, unless the authority extends the period for repayment of the advances. In no event shall the time for repayment be extended beyond the date of receipt of final disbursement of construction loan proceeds. If the authority determines, after making an advance hereunder, that it will not make a mortgage loan or insure a mortgage for the proposed housing under the provisions of this chapter, the advance may, at the discretion of the authority, be treated as a grant to the extent that the advance cannot be repaid from the assets of the recipient corporation or municipal developer, including the project;

      (27) To encourage home ownership by low and moderate income families and persons, including ownership of structures containing not more than four dwelling units where the eligible low or moderate income family or person owning such structure occupies a dwelling unit therein. Structures acquired hereunder may be newly-built, existing or rehabilitated, either before or after acquisition. If newly-built, such structures shall conform to the State Building Code; existing structures shall conform after rehabilitation to standards established by the authority. The authority may assist an eligible mortgagor in the acquisition, construction or rehabilitation of such structures by exercising any of the powers conferred upon the authority by this chapter. Any structure so acquired, constructed or rehabilitated by an eligible mortgagor other than a low or moderate income family or person shall be conveyed to a low or moderate income family or person within one year from the date of such acquisition or from the date of completion of such construction or acquisition, whichever date is later;

      (28) To establish a program to finance the construction or rehabilitation of housing designed for condominium or cooperative ownership, to convert existing housing however financed to such forms of ownership, and to finance the ownership of individual shares of or memberships in cooperative housing, and individual units of condominium housing, which mortgages for such cooperative and condominium housing are financed by the authority, and in connection therewith to make or insure first or second mortgage loans to finance the organization and the construction or rehabilitation of or conversion to cooperative or condominium housing, to assist and advise tenants during a period of conversion to cooperative or condominium ownership, and to make or insure loans to finance the ownership of individual shares of or memberships in existing as well as new or rehabilitated cooperative housing, such loans to be secured by pledges of the individual shares of or memberships in the cooperative housing purchased or by such other security as the authority shall prescribe, pursuant to such rules and regulations as the authority may determine, provided, in the case of mortgage loans or mortgage loan insurance for occupied existing housing to be converted into cooperative or condominium ownership, the authority shall determine, prior to any mortgage loan or mortgage loan insurance commitment, pursuant to rules and regulations promulgated by it, that a sufficient number of the families and persons who are tenants before such conversion have agreed to purchase individual shares of or memberships in any cooperative housing created or units in any condominium declared after conversion to ensure the economic feasibility of the conversion and to ensure that the conversion will not create undue hardship through the displacement of such tenants, provided that, if a loan made by the authority under this section is insured or if the project or any units therein are assisted by any department, agency or instrumentality of the United States or this state, and the terms of the loan insurance commitment or any governmental regulations covering such insurance or other assistance are inconsistent with the terms and conditions required by this section or established by the authority under this chapter, the terms of such loan insurance commitment or governmental regulation shall prevail, to the extent of such inconsistency. As used in this subdivision, "housing" includes the land which constitutes a mobile manufactured home park and "tenants" includes the residents of a mobile manufactured home park;

      (29) To give approval or consent to the articles of incorporation or other basic documents of organization submitted to the authority by an applicant for a mortgage loan. (1) If the applicant is a nonprofit corporation, the articles of incorporation shall, in addition to other requirements of law, provide: (a) That the corporation has been organized to provide housing; (b) that all the income and earnings of the corporation shall be used exclusively for corporate purposes and that no part of the net earnings or net income of the corporation shall inure to the benefit or profit of any private individual, firm, corporation, partnership or association; (c) that the corporation is in no manner controlled or under the direction or acting in the substantial interest of any private individual, firm, partnership or association seeking to derive profit or gain therefrom or seeking to eliminate or minimize losses in any dealing or transactions therewith; (d) that the operations of the corporation may be supervised by the authority and that the corporation shall enter into such agreements with the authority as the authority from time to time requires providing for regulation by the authority of the planning, development and management of any housing project undertaken by the corporation and the disposition of the property and franchises of the corporation. (2) If the applicant is a corporation organized for profit, the articles of incorporation shall provide, in addition to other requirements of law: (a) That the corporation has been organized to provide housing; (b) that every stockholder of the corporation shall be deemed, by the subscription or receipt of stock therein, to have agreed that he at no time shall receive from the corporation in repayment of his investment any sums in excess of the face value of the investment plus cumulative dividends not in excess of the return on equity permitted by other provisions of this chapter, computed from the initial date upon which moneys were paid or property delivered in consideration for the proprietary interest of the stockholder and upon the dissolution of the corporation any surplus in excess of such amounts shall be paid to the authority; (c) that the operations of the corporation may be supervised by the authority and that the corporation shall enter into such agreements with the authority as the authority from time to time requires providing for regulation by the authority of the planning, development and management of any housing undertaken by the corporation and the disposition of the property and franchises of the corporation. (3) If the applicant is an unincorporated association, including, but not limited to, a partnership, limited partnership, joint venture or trust, its basic documents of organization shall provide, in addition to other requirements of law: (a) That the association has been organized to provide housing; (b) that every member of the association shall be deemed by acceptance of a beneficial interest in the association or by executing the basic document of organization to have agreed that he at no time shall receive from such association any return in excess of the face value of the investment attributable to his respective interest plus cumulative dividend payments not in excess of the return on equity permitted by other provisions of this chapter, computed from the initial date upon which moneys were paid or property delivered in consideration for the interest, and upon the dissolution of the association any surplus in excess of such amounts shall be paid to the authority; (c) that the operations of the association may be supervised by the authority and that the association shall enter into such agreements with the authority as the authority from time to time requires providing for the regulation by the authority of the planning, development and management of any housing undertaken by the association, and the disposition of the property and franchises of the association. (4) "Surplus" as used in this subsection shall not be deemed to include any increase in assets of any recipient of a mortgage loan from the authority under this chapter, by reason of reduction of mortgage, by amortization or similar payments, or realized from the sale or disposition of any assets of such recipient, to the extent such surplus can be attributed to any increase in market value of any real property or tangible personal property accruing during the period the assets were owned and held by such recipient. (5) The articles of incorporation or similar basic documents of organization shall further provide that the authority shall have the power to appoint to the board of directors of the nonprofit or for-profit corporation a number of new directors, which number shall be sufficient to constitute a majority of the board, and to appoint a managing agent of the unincorporated association, notwithstanding any other provisions of the articles of incorporation or other basic documents of organization or any other provisions of law, if: (a) The authority determines that the loan or advance made to such recipient is in jeopardy of not being repaid; (b) the authority determines that the proposed housing project for which the loan or advance was made is in jeopardy of not being constructed; (c) the recipient is a nonprofit corporation, and the authority determines that some part of the net income or earnings of the corporation is inuring to the benefit of any private individual, firm, partnership, corporation or association, or that the corporation is in some manner controlled by or under the direction of or acting in the substantial interest of any private individual, firm, corporation, partnership or association seeking to derive benefit or gain therefrom or seeking to eliminate or minimize losses in any dealings or transactions therewith; (d) the recipient is a for-profit corporation or unincorporated association, and the authority determines that some part of the net income or earnings of the recipient, in excess of that permitted by other provisions of this chapter, shall inure to the benefit of any private individual, firm, corporation, partnership or association; (e) the authority determines that the recipient is in violation of any rules or regulations promulgated by the authority under the provisions of this chapter; (f) the authority determines that the recipient is in violation of any agreements entered into with the authority providing for regulation by the authority of the planning, development and management of any housing undertaken by the recipient or the disposition of the property and franchises of such recipient;

      (30) To do all acts and things necessary or convenient to carry out the purposes of this chapter and the powers expressly granted by this chapter;

      (31) To make construction loans secured by a first mortgage to persons for the project costs of subdivision development, upon a finding by the authority that the permanent mortgages are to be used for a housing project and that the construction loan shall include an agreement between the authority and such person which shall establish such restrictions and safeguards as the authority shall deem appropriate and necessary: (1) To assure that savings and benefits realized by such person are reflected in the transfer of title to the mortgagor of such housing whereby said mortgagor is guaranteed full realization of the financial benefit of such savings, or (2) to return to the authority the savings and benefits realized by such person in the event the permanent mortgages are not made to a mortgagor;

      (32) To make commitments to purchase, and to purchase, service and sell mortgages and to make loans directly upon the security of any mortgage, or to purchase and sell Federal Home Loan Mortgage Corporation participation sale certificates, Government National Mortgage Association mortgage-backed securities or other similar securities which are insured by any department, agency or instrumentality of the United States of America or public corporation chartered by Congress during the maximum yields reasonably obtainable for the purpose of generating income to the authority which will enable the authority to provide a lower interest rate than is presently possible for families of low and moderate income. Income limitations adopted by the authority shall not apply to mortgages or securities purchased pursuant to this subsection;

      (33) To make loans which are not secured by a mortgage on real property for the rehabilitation of residential housing for occupancy by persons of low and moderate income, in amounts not to exceed the maximum amount insurable by any department, agency or instrumentality of the United States of America in the case of each loan, on such terms and conditions as the authority may determine, provided any such loan shall be insured or guaranteed by a department, agency or instrumentality of the United States of America, or by such other entity as the authority shall determine is financially able to insure or guarantee repayment in the event of default by the borrower, or coinsured by a department, agency or instrumentality of the United States of America with the authority being a self-insurer for any amount in excess of the insurance available under such coinsurance program;

      (34) In addition to powers previously provided pursuant to this chapter and without regard to the limitations in sections 8-253a and 8-254a: (1) To establish a program to finance urban area mortgages and to make, enter into and enforce all contracts or agreements necessary, convenient or desirable with respect thereto; provided applications for urban area mortgages may be considered only when the desired loan may not be otherwise available on reasonable terms; (2) to insure mortgage payments for any urban area mortgage on the same terms and conditions of and subject to the applicable provisions of sections 8-253 and 8-254 and to enter into mortgage insurance agreements with lending institutions in connection with the lending of money by such institutions for the making of urban area mortgages; and (3) from time to time to adopt, modify, amend or repeal rules and regulations governing the making, purchasing, servicing and sale of such urban area mortgages;

      (35) To make loans and advances to any mortgagor owning a housing project: (1) For repairs, maintenance, improvements and replacements in the project and the acquisition of any equipment or supplies required therefor; (2) for the payment of liens or claims against any project or against any nonprofit corporation or municipal developer owning any project and arising out of the ownership or operation of such project; or (3) for the payment of any other expenses deemed necessary or desirable to protect the interest of the authority; provided in each case that the construction, acquisition or rehabilitation of the project was financed by a mortgage loan held or insured by the authority, the mortgagor owning the project is unable to make any such payment, and the failure to make any such payment would either (i) constitute or threaten a delinquency or default under the mortgage held or insured by the authority, or a violation of any agreements entered into with the authority or (ii) jeopardize the economic stability of the project. Any such loan or advance may, at the discretion of the authority, be treated as a grant and, if not so treated, shall be evidenced by a second mortgage on the housing project and shall be repaid according to such terms and conditions as the authority may prescribe, except that the repayment of the loan in the event of default under such mortgage by the mortgagor need not be insured or guaranteed;

      (36) To provide in all programs of the authority means to finance project costs for the purchase, construction and installation in new and existing buildings of energy conservation measures and renewable energy systems providing space heating or cooling, domestic hot water, electricity or other useful energy, regardless of whether a building is presently financed in whole or in part by other programs of the authority. Such energy financing programs shall include making or insuring first or second mortgage loans or loans secured by a security other than a mortgage, as the authority may prescribe. The authority's energy loan programs shall be designed to carry out the state policy of encouraging energy conservation and the widespread use of renewable energy to reduce dependence on conventional fuels subject to rapid increases in cost and uncertain availability. The authority may prescribe loan conditions and loan eligibility criteria consistent with state policy. For the purposes of this subsection "renewable energy" means solar, wind, water and biomass energy;

      (37) To make loans to any person who is sixty-two years of age or older and who owns a single family dwelling in which he resides, for the purpose of converting a portion of the dwelling into a rental unit, subject to applicable zoning regulations;

      (38) To extend mortgage loan guarantees to mortgage lending institutions to refinance residential mortgage loans when a decrease in the appraised value of the real property securing the mortgage precludes such lending;

      (39) (a) In connection with, or incidental to, the issuance or carrying of bonds, or acquisition or carrying of any investment or program of investment, to enter into any contract which the authority determines to be necessary or appropriate to place the obligation or investment of the authority, as represented by the bonds, investment or program of investment and the contract or contracts, in whole or in part, on the interest rate, currency, cash flow, or other basis desired by the authority, including, without limitations, contracts commonly known as interest rate swap agreements, currency swap agreements, forward payment conversion agreements, futures, or contracts providing for payments based on levels of, or changes in, interest rates, currency exchange rates, stock or other indices, or contracts to exchange cash flows or a series of payments, or contracts, including, without limitation, interest rate floors or caps, options, puts or calls to hedge payment, currency, rate, spread, or similar exposure or, contracts for the purchase of option rights with respect to the mandatory tender for purchase of bonds, notes or other obligations of the authority, which are subject to mandatory tender or redemption, including the issuance of certificates evidencing the right of the owner to exercise such option rights. These contracts or arrangements may also be entered into by the authority in connection with, or incidental to, entering into or maintaining any agreement which secures its bonds, notes or other obligations, subject to the terms and conditions thereof respecting outstanding obligations. (b) Bonds issued by the authority may be payable in accordance with their terms, in whole or in part, in currency other than lawful money of the United States of America, provided that the authority enter into a currency swap or similar agreement for payments in lawful money of the United States of America, which covers the entire amount of the debt service payment obligation of the authority with respect to the bonds payable in other currency, and provided further, that if the term of that agreement is less than the term of the bonds, the authority shall include a best efforts covenant to enter into additional agreements as may be necessary to cover the entire amount of the debt service payment obligation. (c) In connection with, or incidental to, the issuance or carrying of bonds, notes or other obligations or entering into any of the contracts or agreement referred to in subdivision (a), the authority may enter into credit enhancement or liquidity agreements, with payment, interest rate, currency, security, default, remedy and other terms and conditions as the authority determines;

      (40) To develop a program to assist the residents of mobile manufactured home parks finance the purchase of the parks in which they live, including residents who have received notice pursuant to subsection (f) of section 21-70;

      (41) To make, originate, administer, hold and service grants, deferred loans and loans and the security given therefor, and to perform such other functions as may be necessary and appropriate, with respect to the home ownership loan program established pursuant to sections 8-283 to 8-289, inclusive, or the private rental investment mortgage and equity program established pursuant to sections 8-400 to 8-406, inclusive; provided that not later than January 1, 1996, the authority shall adopt procedures for administration of such programs pursuant to section 1-121;

      (42) To accept from the department: (A) Financial assistance, (B) revenues or the right to receive revenues with respect to any program under the supervision of the department, and (C) loan assets or equity interests in connection with any program under the supervision of the department; to make advances to and reimburse the department for any expenses incurred or to be incurred by it in the delivery of such assistance, revenues, rights, assets, interests or amounts; to enter into agreements with the department for the delivery of services by the authority in consultation with the department, the Connecticut Development Authority and Connecticut Innovations, Incorporated, to third parties which agreements may include provisions for payment by the department to the authority for the delivery of such services; and to enter into agreements with the department or with the Connecticut Development Authority or Connecticut Innovations, Incorporated, for the sharing of assistants, agents and other consultants, professionals and employees, and facilities and other real and personal property used in the conduct of the authority's affairs;

      (43) To transfer to the department: (A) Financial assistance; (B) revenues or the right to receive revenues with respect to any program under the supervision of the authority; and (C) loan assets, equity interests or financial participation in connection with any program under the supervision of the authority, provided the transfer of such financial assistance, revenues, rights, assets, interests or participation is determined by the authority to be practicable, within the constraints and not inconsistent with the fiduciary obligations of the authority imposed upon or established upon the authority by any provision of the general statutes, the authority's bond resolutions or any other agreement or contract of the authority and to have no adverse effect on the tax-exempt status of any bonds of the authority or the state;

      (44) Provide assistance, in such form and subject to such conditions as the authority may determine, to a local housing authority or project sponsor in connection with a housing revitalization project undertaken pursuant to sections 34 to 38, inclusive, of public act 03-6 of the June 30 special session*;

      (45) To develop and implement a program to purchase, and to fund the authority's purchase of, foreclosed residential real property in this state for the purpose of providing affordable and supportive housing, and to report, in accordance with section 11-4a, no later than January 1, 2009, on the program and plans for its implementation to the joint standing committees of the General Assembly having cognizance of matters relating to banks and planning and development, and to the select committee of the General Assembly having cognizance of matters relating to housing.

      (1969, P.A. 795, S. 10; 1971, P.A. 840, S. 3; 1972, P.A. 208, S. 5; P.A. 74-104, S. 6-8, 12; P.A. 75-465, S. 2, 7; P.A. 76-13, S. 2, 3, 7; 76-118, S. 3, 6; P.A. 77-316, S. 1-4; P.A. 79-261; 79-578, S. 2, 3; 79-631, S. 21, 111; P.A. 81-271; P.A. 85-613, S. 88, 154; P.A. 86-367, S. 1, 2; 86-403, S. 18, 132; P.A. 87-436, S. 16, 17, 23; P.A. 93-33, S. 1, 4; 93-248, S. 2; 93-308, S. 2, 12; 93-435, S. 94, 95; P.A. 94-125, S. 1; P.A. 95-202, S. 6; 95-250, S. 9, 42; 95-309, S. 1, 11, 12; June 30 Sp. Sess. P.A. 03-6, S. 39; May Sp. Sess. P.A. 04-2, S. 91; P.A. 08-176, S. 4; P.A. 10-32, S. 19.)

      *Note: Sections 34 to 38, inclusive, of public act 03-6 of the June 30 special session are special in nature and therefore have not been codified but remain in full force and effect according to their terms.

      History: 1971 act prohibited attachment or garnishment of authority's fund or assets before final judgment in Subsec. (n); 1972 act amended Subsec. (a) by adding repeal and amendment powers, amended Subsec. (b) by removing limitation to low and moderate-income families, amended Subsec. (c) to include U.S. instrumentalities and to delete specific references to payments, amended Subsec. (d) to include agreements with state and federal agencies and to expand areas subject to agreements, rephrased Subsec. (e), inserted new Subsecs. (j), (m) and (n) relettering intervening and subsequent Subsecs. accordingly, clarified borrowing power under Subsec. (k), formerly Subsec. (l), amended Subsec. (l), formerly (k) to provide for securing bonds, amended Subsec. (o), formerly (l), to provide for technical assistance to mortgagors and for hiring of various independent professionals, amended Subsec. (r), formerly (o), to allow investments in time deposits, etc., substituted "authority" for "agency" in Subsec. (t), formerly (q), included families in Subsec. (u), formerly (r), included review by state in Subsec. (v), formerly (s), deleted limitation to families of low and moderate-income in Subsecs. (x) and (y), formerly (u) and (v) and added Subsecs. (z) to (cc) relettering former Subsec. (w) as Subsec. (dd); P.A. 74-104 substituted "newly-built, existing or rehabilitated" for "newly-built or existing and rehabilitated" in Subsec. (aa), included second mortgages in Subsec. (bb) and added Subsec. (ee); P.A. 75-465 added Subsec. (ff); P.A. 76-13 changed reference to three-unit homes owned by low or moderate-income family to four-unit homes in Subsec. (aa) and added Subsec. (gg); P.A. 76-118 added Subsec. (hh); P.A. 77-316 clarified provisions in Subsecs. (g) and (bb) relative to cooperative ownership, added provisions concerning conflicts between government and authority regulations relative to insurance, amended Subsec. (gg) to increase loan limit from $6,000 to $10,000, to specify rehabilitation of "one to four-family" residential housing and added provision for coinsurance and added Subsec. (ii); P.A. 79-261 amended Subsec. (gg) to replaced $10,000 loan limit with "the maximum amount insurable by any department, agency..." of the U.S. and to replace coinsurance of "first ten per cent of any loan" with "any amount in excess of the insurance available under such coinsurance program"; P.A. 79-578 added Subsec. (jj); P.A. 79-631 made technical changes; P.A. 81-271 amended Subsec. (gg) to remove limitation which had restricted unsecured loans to the rehabilitation of "one to four-family" residential housing; P.A. 85-613 made technical changes, deleting references to Secs. 8-264 and 8-265 in Subdiv. (q); P.A. 86-367 added Subsec. (kk), authorizing loans for conversion of portion of certain dwellings into rental units; P.A. 86-403 made technical change in Subsec. (hh); P.A. 87-436 added references to municipal developers in Subsecs. (z) and (ii); (Revisor's note: In 1989 subsection alphabetic designators were changed editorially by the Revisors to numberic indicators for consistency with customary statutory usage); P.A. 93-33 added new Subdiv. designated as (39) authorizing the authority to enter into contracts to obtain more favorable interest rates on bonds, effective April 20, 1993; P.A. 93-248 added provision re employer-assisted housing efforts; P.A. 93-308 added new Subdiv. designated as (38) authorizing guarantees to mortgage lending institutions to refinance residential mortgage loans, effective July 1, 1993; P.A. 93-435 changed effective date of P.A. 93-308 from July 1, 1993, to June 9, 1993, effective June 28, 1993; P.A. 94-125 amended Subdiv. (28) by adding the definition of "housing" and added Subdiv. (40) re assistance in purchase of mobile home parks by their residents (Revisor's note: In Subdiv. (39), the phrase "the authority may enter" was replaced editorially by the Revisors with "to enter" to conform with wording of other Subdivs. of the section); P.A. 95-202 amended Subdiv. (34) to delete provision requiring proof of refusal of financial assistance from two financial decisions; P.A. 95-250 added Subdiv. (41) authorizing the authority to administer the Homeownership Loan Program and the Private Rental Investment Mortgage and Equity Program and Subdivs. (42) and (43) re participation in programs administered by the Department of Economic and Community Development; P.A. 95-309 amended Subdiv. (43) to provide for financial participation and to add condition of no adverse effect on the tax-exempt status of any bonds, and changed effective date of P.A. 95-250 but did not affect this section; June 30 Sp. Sess. P.A. 03-6 added Subdiv. (44) authorizing the authority to provide assistance to a local housing authority or project sponsor for a housing revitalization project, effective August 20, 2003; May Sp. Sess. P.A. 04-2 amended Subdiv. (44) by replacing reference to "this section" with reference to "sections 34 to 38, inclusive, of public act 03-6 of the June 30 special session", effective May 12, 2004; P.A. 08-176 added Subdiv. (45) re purchase of foreclosed property for provision of affordable and supportive housing, effective July 1, 2008; P.A. 10-32 made a technical change in Subdiv. (22), effective May 10, 2010.

      See Sec. 8-37jj re approval of electric resistance as primary heat source.

      See Sec. 8-37kk re preference to loans for energy efficient projects.

      See Sec. 31-3nn re mortgage crisis job training program.

      Sec. 8-251. Purchase, servicing and sale of mortgages or interests therein. Urban area mortgages. Loans for mobile manufactured homes. (a) In order to provide additional construction and permanent financing for housing in this state, the authority is authorized to make commitments to purchase, and to purchase, service and sell mortgages and to make loans directly upon the security of any mortgage, and to make commitments to purchase, and to purchase and sell participation sale certificates representing interests in mortgages, provided the underlying mortgage loans shall have been made and shall be used solely to finance or refinance the construction, rehabilitation, purchase or leasing of housing in this state, and provided further the aggregate amount of permanent mortgages, mortgage-backed securities and participation sale certificates representing interests in mortgages purchased, and permanent loans made by the authority which are not directly or indirectly insured or guaranteed by any department, agency, instrumentality of the United States of America, or public corporation chartered by the Congress of the United States, including but not limited to the Federal Home Loan Mortgage Corporation, or which are not insured or guaranteed by any department, agency or instrumentality of the state, any insurance company licensed to do business in the state and authorized to underwrite mortgage insurance or by the authority shall not at any one time exceed one billion five hundred million dollars.

      (b) For the purpose of encouraging balanced community development in urban areas and increasing the supply and availability of mortgage financing for the residents of urban areas, the authority is authorized to make commitments to purchase, and to purchase, urban area mortgages or to make loans directly upon the security of urban area mortgages or to make loans for, or to purchase, urban area mortgages under terms and conditions requiring the proceeds thereof to be used for the making of additional urban area mortgages, subject to the provisions of section 8-250.

      (c) For the purpose of assisting Connecticut residents to purchase mobile manufactured homes to be located in a manufactured housing community, the authority shall set aside not less than two million dollars to be used to provide loans directly to such residents. Such loans shall not require the purchase of private mortgage insurance, and shall accept an annual renewable lease for the lot on which such home is located.

      (1969, P.A. 795, S. 11; 1972, P.A. 208, S. 6; P.A. 74-104, S. 9, 12; P.A. 75-465, S. 3, 7; P.A. 76-3; 76-118, S. 4, 6; P.A. 82-49, S. 1, 2; P.A. 84-328, S. 1, 2; P.A. 87-313, S. 1, 2; P.A. 06-47, S. 1; 06-194, S. 8; P.A. 08-176, S. 3.)

      History: 1972 act included construction financing, deleted limitation of provisions to low and moderate-income families and allowed mortgages and loans not insured by federal or state agencies up to $100,000,000 limit, previously all loans and mortgages had to be insured by federal agency; P.A. 74-104 added provisions concerning interests in mortgages and excluding loans by public corporations chartered by Congress from $100,000,000 limit; P.A. 75-465 increased loan limit to $200,000,000 and included mortgage-backed securities in limit; P.A. 76-3 excluded loans by insurance companies licensed in state from $200,000,000; P.A. 76-118 added Subsec. (b) re urban area mortgages; P.A. 82-49 increased the limit to $300,000,000; P.A. 84-328 increased loan limit to $500,000,000; P.A. 87-313 increased loan limit to $750,000,000; P.A. 06-47 amended Subsec. (a) to increase loan limit $1,000,000,000; P.A. 06-194 added Subsec. (c) re loans for mobile manufactured homes, effective July 1, 2006; P.A. 08-176 amended Subsec. (a) to raise cap from $1,000,000,000 to $1,500,000,000, effective July 1, 2008.

      Sec. 8-252. Issuance of bonds by authority. (a) The authority is authorized from time to time to issue its bonds, bond anticipation notes and other obligations in such principal amounts as in the opinion of the authority shall be necessary to provide sufficient funds for carrying out the purposes set forth in subsections (32) and (33) of section 8-250 and section 8-251, including the payment, funding or refunding of the principal of, or interest or redemption premiums on, any bonds, bond anticipation notes and other obligations issued by it whether the bonds, bond anticipation notes or other obligations or interest to be funded or refunded have or have not become due, the establishment of reserves to secure such bonds, bond anticipation notes and other obligations and all other expenditures of the authority incident to and necessary or convenient to carry out the purposes set forth in subsections (32) and (33) of section 8-250 and section 8-251.

      (b) Except as may be otherwise expressly provided herein or by the authority, every issue of bonds, bond anticipation notes or other obligations shall be general obligations payable out of any moneys or revenues of the authority subject only to any agreements with the holders of particular bonds, bond anticipation notes or other obligations pledging any particular moneys or revenues, or any specific mortgages or pool of mortgages acquired by the authority. Any such bonds, bond anticipation notes or other obligations may be additionally secured by a pledge of any grant or contributions from any department, agency or instrumentality of the United States or person or a pledge of any moneys, income or revenues of the authority from any source whatsoever.

      (c) Any provision of any law to the contrary notwithstanding, any bonds, bond anticipation notes or other obligations issued by the authority pursuant to this chapter shall be fully negotiable within the meaning and for all purposes of title 42a and each holder or owner of such a bond, bond anticipation note or other obligation or coupon is and shall be fully negotiable within the meaning and for all purposes of said title 42a. Any such bonds, bond anticipation notes or other obligations shall be legal investments for all trust companies, banks, investment companies, savings banks, building and loan associations, executors, administrators, guardians, conservators, trustees and other fiduciaries, and pension, profit-sharing and retirement funds and shall be exempt, both as to principal and interest, from any taxes imposed by the state of Connecticut or any subdivision thereof, other than estate or succession taxes.

      (d) Bonds, bond anticipation notes or other obligations of the authority shall be authorized by resolution of the authority and may be issued in one or more series and shall bear such date or dates, mature at such time or times, in the case of any such note, or any renewal thereof, not exceeding five years from the date of the original issue of such notes, and, in the case of bonds, not exceeding fifty years from the date thereof, bear interest at such rate or rates, be in such denomination or denominations, be in such form, either coupon or registered, carry such conversion or registration privileges, have such rank or priority, be executed in such manner, be payable from such sources in such medium of payment at such place or places within or without this state, and be subject to such terms of redemption, with or without premium, as such resolution or resolutions may provide.

      (e) Bonds, bond anticipation notes or other obligations of the authority may be sold at public or private sale at such price or prices as the authority shall determine.

      (f) Bonds, bond anticipation notes or other obligations of the authority may be refunded and renewed from time to time as may be determined by resolution of the authority, provided any such refunding or renewal shall be in conformity with any rights of the holders thereof.

      (g) Bonds, bond anticipation notes or other obligations of the authority issued under the provisions of this chapter shall not be deemed to constitute a debt or liability of the state or of any political subdivision thereof other than the authority or a pledge of the faith and credit of the state or of any such political subdivision other than the authority, and shall not constitute bonds or notes issued or guaranteed by the state within the meaning of section 3-21, but shall be payable solely from the funds herein provided therefor. All such bonds, bond anticipation notes or other obligations shall contain on the face thereof a statement to the effect that neither the state of Connecticut nor any political subdivision thereof other than the authority shall be obligated to pay the same or the interest thereon except from revenues or other funds of the authority and that neither the faith and credit nor the taxing power of the state of Connecticut or of any political subdivision thereof other than the authority is pledged to the payment of the principal of or the interest on such bonds, bond anticipation notes or other obligations.

      (h) Any resolution or resolutions authorizing the issuance of bonds, bond anticipation notes or other obligations may contain provisions, except as expressly limited in this chapter and except as otherwise limited by existing agreements with the holders of bonds, bond anticipation notes or other obligations, which shall be a part of the contract with the holders thereof, as to the following: (i) The pledging of all or any part of the moneys received by the authority in payment of loans and interest thereon, and other moneys received or to be received, to secure the payment of the principal of and interest on any bonds, bond anticipation notes or other obligations or of any issue thereof; (ii) the pledging of all or any part of the assets of the authority including but not limited to mortgages and other obligations securing the same, to secure the payment of the principal and interest on any bonds, bond anticipation notes or other obligations or of any issue thereof; (iii) the use and disposition of the gross income from, and the payments of principal received by the authority on, mortgages held by the authority; (iv) the establishment of reserves or sinking funds, the making of charges and fees to provide for the same, and the regulation and disposition thereof; (v) limitations on the purpose to which the proceeds of sale of bonds, bond anticipation notes or other obligations may be applied and pledging such proceeds to secure the payment of the bonds, bond anticipation notes or other obligations, or of any issues thereof; (vi) limitations on the issuance of additional bonds, bond anticipation notes or other obligations; the terms upon which additional bonds, bond anticipation notes or other obligations may be issued and secured; the refunding or purchase of outstanding bonds, bond anticipation notes or other obligations of the authority; (vii) the procedure, if any, by which the terms of any contract with the holders of any bonds, bond anticipation notes or other obligations of the authority may be amended or abrogated, the amount of bonds, bond anticipation notes or other obligations the holders of which must consent thereto, and the manner in which such consent may be given; (viii) limitations on the amount of moneys to be expended by the authority for operating, administrative or other expenses of the authority; (ix) the vesting in a trustee or trustees of such property, rights, powers and duties in trust as the authority may determine, which may include any or all of the rights, powers and duties of any trustee appointed by the holders of any bonds, bond anticipation notes or other obligations and limiting or abrogating the right of the holders of any bonds, bond anticipation notes or other obligations of the authority to appoint a trustee under this chapter or limiting the rights, powers and duties of such trustee; (x) provision for a trust agreement by and between the authority and a corporate trustee which may be any trust company or bank having the powers of a trust company within or without the state, which agreement may provide for the pledging or assigning of any assets or income from assets to which or in which the authority has any rights or interest, and may further provide for such other rights and remedies exercisable by the trustee as may be proper for the protection of the holders of any bonds, bond anticipation notes or other obligations of the authority and not otherwise in violation of law, and such agreement may provide for the restriction of the rights of any individual holder of bonds, bond anticipation notes or other obligations of the authority. All expenses incurred in carrying out the provisions of such trust agreement may be treated as a part of the cost of operation of the authority. The trust agreement may contain any further provisions which are reasonable to delineate further the respective rights, duties, safeguards, responsibilities and liabilities of the authority; individual and collective holders of bonds, bond anticipation notes and other obligations of the authority and the trustee; (xi) covenants to do or refrain from doing such acts and things as may be necessary or convenient or desirable in order to better secure any bonds, bond anticipation notes or other obligations of the authority, or which, in the discretion of the authority, will tend to make any bonds, bond anticipation notes or other obligations to be issued more marketable notwithstanding that such covenants, acts or things may not be enumerated herein; (xii) any other matters of like or different character, which in any way affect the security or protection of the bonds, bond anticipation notes or other obligations.

      (i) Any pledge made by the authority of income, revenues or other property shall be valid and binding from the time the pledge is made. The income, revenue or other property so pledged and thereafter received by the authority shall immediately be subject to the lien of such pledge without any physical delivery thereof or further act, and the lien of any such pledge shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against the authority, irrespective of whether such parties have notice thereof.

      (j) The authority is authorized and empowered to obtain from any department, agency or instrumentality of the United States any insurance or guarantee as to, or of or for the payment or repayment of, interest or principal, or both, or any part thereof, on any bonds, bond anticipation notes or other obligations issued by the authority pursuant to the provisions of this chapter; and notwithstanding any other provisions of this chapter to enter into any agreement, contract or any other instrument whatsoever with respect to any such insurance or guarantee except to the extent that such action would in any way impair or interfere with the authority's ability to perform and fulfill the terms of any agreement made with the holders of the bonds, bond anticipation notes or other obligations of the authority.

      (k) Neither the members of the board of directors of the authority nor any person executing bonds, bond anticipation notes or other obligations issued pursuant to this chapter shall be liable personally on such bonds, bond anticipation notes or other obligations by reason of the issuance thereof.

      (l) The authority shall have power to purchase bonds, bond anticipation notes or other obligations of the authority out of any funds available therefor. The authority may hold, cancel or resell such bonds, bond anticipation notes or other obligations subject to and in accordance with agreements with holders of its bonds, bond anticipation notes and other obligations.

      (m) All moneys received pursuant to the authority of this chapter, whether as proceeds from the sale of bonds or as revenues, shall be deemed to be trust funds to be held and applied solely as provided in this chapter. Any officer with whom, or any bank or trust company with which, such moneys shall be deposited shall act as trustee of such moneys and shall hold and apply the same for the purposes hereof, subject to such regulations as this chapter and the resolution authorizing the bonds of any issue or the trust agreement securing such bonds may provide.

      (n) Any holder of bonds, bond anticipation notes or other obligations issued under the provisions of this chapter or any of the coupons appertaining thereto, and the trustee or trustees under any trust agreement, except to the extent the rights herein given may be restricted by any resolution authorizing the issuance of, or any such trust agreement securing, such bonds, may, either at law or in equity, by suit, action, mandamus or other proceedings, protect and enforce any and all rights under the laws of the state or granted hereunder or under such resolution or trust agreement, and may enforce and compel the performance of all duties required by this chapter or by such resolution or trust agreement to be performed by the authority or by any officer, employee or agent thereof, including the fixing, charging and collecting of the rates, rents, fees and charges herein authorized and required by the provisions of such resolution or trust agreement to be fixed, established and collected.

      (o) The authority is authorized and empowered, from time to time, for the purposes and upon the findings set forth in section 8-242, to issue bonds, notes or other obligations the interest on which may be includable under the Internal Revenue Code of 1986 or any subsequent corresponding internal revenue code of the United States, as from time to time amended, in the gross income of the holder or holders of such bonds, notes or other obligations to the same extent and in the same manner that interest on bills, bonds, notes or other obligations of the United States is includable in the gross income of the holders or holders thereof under said Internal Revenue Code; the state hereby consents to such inclusion only for the bonds, notes and other obligations of the authority authorized by this subsection. Such taxable bonds, notes or other obligations of the authority may be issued pursuant to this subsection by the authority for the purpose of financing the purchase, construction, rehabilitation or refinancing of new or existing multifamily rental developments and common interest ownership communities or land, upon a finding and determination by the board of directors, based on reasonable information, that such financing or refinancing is not readily available and that it is appropriate and in the public interest.

      (p) The authority is authorized and empowered, from time to time to issue bonds, notes or other obligations the interest on which may be includable under the Internal Revenue Code of 1986 or any subsequent corresponding internal revenue code of the United States, as from time to time amended, in the gross income of the holder or holders of such bonds, notes or other obligations to the same extent and in the same manner that interest on bills, bonds, notes or other obligations of the United States is includable in the gross income of the holder or holders thereof under said Internal Revenue Code; the state hereby consents to such inclusion only for the bonds, notes and other obligations of the authority authorized by this subsection and subsection (o) of this section. Such taxable bonds, notes or other obligations of the authority may be issued pursuant to this subsection by the authority for the purpose of financing the purchase, construction, rehabilitation or refinancing of existing or new residential structures containing not more than four dwelling units or land, upon a finding and determination by the board of directors, based on reasonable information, that such financing or refinancing is not readily available and that it is appropriate and in the public interest.

      (1969, P.A. 795, S. 12; P.A. 75-465, S. 4, 7; P.A. 76-13, S. 4, 7; P.A. 82-393, S. 2, 3; P.A. 83-399, S. 2, 3; P.A. 88-266, S. 10, 46; P.A. 89-211, S. 15; P.A. 93-125, S. 1, 3.)

      History: P.A. 75-465 added reference to Sec. 8-250(ff) in Subsec. (a); P.A. 76-13 added reference to Sec. 8-250(gg) in Subsec. (a); P.A. 82-393 inserted Subsec. (o) allowing the issuance of taxable obligations for certain purposes; P.A. 83-399 added Subsec. (p); P.A. 88-266 added reference to board of directors in Subsec. (k); (Revisor's note: In 1989 internal references to Subdivs. "(ff)" and "(gg)" of Sec. 8-250 were replaced editorially by the Revisors with references to "(32)" and "(33)" to conform with changes made by the Revisors to said section for consistency with customary statutory usage); P.A. 89-211 clarified reference to the Internal Revenue Code of 1986; P.A. 93-125 amended Subsec. (o) to delete Subdivs. (1) and (2) and replace them with provisions authorizing the authority to use proceeds of bonds for the purchase, construction, rehabilitation or refinancing of multifamily rental developments and common interest ownership communities or land and amended Subsec. (p) to authorize the authority to use the proceeds of bonds for the refinancing of certain residential structures, effective June 11, 1993.

      Sec. 8-252a. Issuance of bonds secured by payments and other revenues to be received by the state with respect to loans made by the state under bond-financed housing programs. (a) The Connecticut Housing Finance Authority is authorized to issue bonds secured by a pledge of principal and interest payments and other revenues to be received by the state with respect to any loans made by the state under any bond-financed housing program, as defined in section 8-37qq. Except as otherwise provided in this section, the issuance of such bonds shall be governed by the provisions of section 8-252. Such bonds may be guaranteed by the authority, which guarantee may be a general obligation of the authority. Such bonds whether or not a general obligation of the authority may be secured by revenues or other assets of the authority which are not subject to the lien of the general housing mortgage program bond resolution of the authority adopted September 27, 1972, as amended, or subject to a lien created by any other existing bond resolution of the authority. The state, acting through the State Treasurer, is authorized to pledge such principal and interest payments and other revenues, and to make such agreements, covenants and representations as may be required for issuance of the bonds. The provisions of subdivision (3) of section 32-1l shall not apply to any pledge under this section, nor to any transfer of revenues to the Connecticut Housing Finance Authority or to a trustee incident to the issuance of bonds under this section, but such a pledge or transfer of revenues from bond-financed state housing programs, as defined in section 8-37qq, to the Connecticut Housing Finance Authority or to a trustee incident to the issuance of bonds under this section is hereby authorized. Any pledges made pursuant to this section shall be valid and binding from the time such pledge is made, and are not subject to further appropriation by the state. The proceeds of any bonds issued pursuant to this section shall, after payment of all costs of issuance and sale, including, without limitation, the costs of credit facilities and the establishment of any reserves as security for such bonds, be deposited in the General Fund.

      (b) In the event that the total of principal and interest payments and other revenues pledged to any trustee in accordance with a pledge made pursuant to subsection (a) of this section and received in any fiscal year are less than the total of all interest and principal payments and other revenues on loans under any bond-financed housing program as defined in section 8-37qq by the state in that same fiscal year, the Secretary of the Office of Policy and Management shall apportion any payments to be transferred to such trustee under such pledge among payments that would otherwise have flowed to the General Fund, the Rental Housing Fund or the Housing Repayment and Revolving Loan Fund and may, on behalf of the state, make such agreements, covenants and representations with respect to such apportionment as may be required for issuance of the bonds under this section. In the event that principal and interest payments or other revenues pledged pursuant to subsection (a) of this section are transferred in any fiscal year to any trustee in excess of total debt service payments required in such fiscal year under the terms of any indenture of trust for bonds issued under this section the balance shall be returned to the state. Such returned balance shall be apportioned among the General Fund, the Rental Housing Fund or the Housing Repayment and Revolving Loan Fund, as determined by the Secretary of the Office of Policy and Management provided, any such returned balance shall first be apportioned to the Housing Repayment and Revolving Loan Fund, up to the amount which would otherwise have flowed to the Housing Repayment and Revolving Loan Fund in such fiscal year absent such pledge under this section.

      (c) Nothing in this section shall be construed to authorize (1) the use of moneys in any sinking fund which may have been pledged by resolution or trust indenture in connection with the issuance of any general obligation bonds, as to which sinking fund the state did not reserve the right to application and use of such moneys for other purposes, (2) the pledge of moneys, any apportionment of payments or returned balances in subsection (b) of this section that the State Treasurer determines to have been precluded by any covenant or agreement with bondholders on any outstanding general obligation bonds of the state, or (3) the pledge of certain loan payments or revenue if it is determined by the State Treasurer that the tax-exempt status of any outstanding general obligation bonds of the state shall be jeopardized by the pledge of such payments or revenues.

      (P.A. 97-309, S. 11, 23; 97-322, S. 7, 9.)

      History: P.A. 97-309 effective July 1, 1997; P.A. 97-322 changed effective date of P.A. 97-309 but without affecting this section.

      Sec. 8-253. Mortgage loans and insurance of mortgage payments. (a) The authority may make mortgage loans or upon application of a proposed mortgagee insure and make advance commitments to insure payments required by a loan for housing upon such terms and conditions as the authority may prescribe. Mortgage loans made or insured by the authority under this chapter may be for construction financing as well as permanent financing, and may provide financing for related facilities to the extent permitted by applicable authority regulations. Mortgage loans made or insured by the authority under this chapter shall be secured by a first or second mortgage. The aggregate principal amount of all mortgages so insured by the authority under this chapter and outstanding at any one time shall not exceed ten times the average annual balance for the preceding calendar year of funds on deposit in the Housing Mortgage Insurance Fund. The aggregate amount of principal obligations of all mortgages so insured shall not constitute indebtedness of the state of Connecticut. Any contract of insurance executed by the authority under this section shall be conclusive evidence of eligibility for such mortgage insurance and the validity of any contract of insurance so executed or of an advance commitment to issue such shall be incontestable in the hands of an approved mortgagee from the date of execution of such contract or commitment, except for fraud or misrepresentation on the part of such approved mortgagee and, as to commitments to insure, noncompliance with the terms of the advance commitment or authority regulations in force at the time of issuance of the advance commitment.

      (b) For mortgage payments to be eligible for insurance under the provisions of this chapter, the underlying mortgage shall be one which is made to and held by a mortgagee approved by the authority as responsible and able to service the mortgage properly. Permanent mortgage loans made or insured by the authority under the provisions of this chapter shall: (1) Not exceed (i) ninety per cent of the estimated cost of such proposed housing if owned or to be owned by a profit-making mortgagor or (ii) one hundred per cent of the estimated cost of such proposed housing if owned or to be owned by a housing authority, a municipal developer, a nonprofit corporation or cooperative or by a resident-owner of a structure containing not more than three dwelling units, or of a condominium; (2) have a maturity satisfactory to the authority but in no case longer than fifty years from the date of the issuance of the loan or insurance; (3) contain amortization provisions satisfactory to the authority requiring periodic payments by the mortgagor not in excess of his reasonable ability to pay as determined by the authority; (4) be in such form and contain such terms and provisions with respect to maturity, property insurance, repairs, alterations, payment of taxes and assessments, default reserves, delinquency charges, default remedies, anticipation of maturity, additional and secondary liens, equitable and legal redemption rights and other matters as the authority may prescribe. If a loan made by the authority under this chapter is insured or if the project or any units therein are assisted by any department, agency or instrumentality of the United States or this state, and the terms of the mortgage insurance commitment or regulatory agreement covering such insurance or other assistance are inconsistent with the terms and conditions required by this section or established by the authority under this chapter, the terms of such mortgage insurance commitment or regulatory agreement shall prevail, to the extent of such inconsistency.

      (c) Construction mortgage loans made by the authority under the provisions of this chapter may be advanced at the discretion of the authority in installments as the work progresses, provided that the authority shall retain not more than ten per cent of the construction contract price until the construction or rehabilitation has been inspected and found by the authority to be more than ninety per cent completed. Thereafter such retention or any part thereof may be either advanced at the discretion of the authority or retained until the authority shall determine that the mortgagor has complied with all of the terms and conditions of subsection (b) of section 8-253 and section 8-253a. The total of all advances made, after any adjustment under subdivision (6) of section 8-253a, shall not exceed (i) ninety per cent of the project cost if owned or to be owned by a profit making mortgagor or (ii) one hundred per cent of the project cost if owned or to be owned by a housing authority, a municipal developer or a nonprofit corporation or cooperative.

      (1969, P.A. 795, S. 13; 1971, P.A. 840, S. 2; 1972, P.A. 208, S. 7; P.A. 74-104, S. 10, 12; P.A. 77-316, S. 7; P.A. 87-436, S. 18, 23.)

      History: 1971 act replaced requirement that aggregate amount of mortgages not exceed "five times that portion of the bonds authorized by the state bond commission which when sold are to be deposited in the housing mortgage insurance fund ..." with requirement that amount not exceed "ten times the average annual balance for the preceding calendar year of funds on deposit" in said fund; 1972 act divided section into subsecs., allowed authority to make loans as well as insure them, allowed loans for construction and for related facilities as well as for permanent financing, allowed 100% financing for housing to be owned by housing authority or by resident-owner of structure with not more than three units rather than by resident-owner of single-family dwelling, changed maturity limit from 80% of remaining useful life of housing or 40 years to 50 years, added provision re conflicts between federal and state regulations and authority regulations and added Subsec. (c) re advances of construction mortgage loans; P.A. 74-104 amended Subsec. (a) to allow securing of loans by second mortgage as well as first mortgage; P.A. 77-316 substituted "mortgagor" for "corporation" in Subsec. (b)(1)(i) and amended Subsec. (c) clarifying procedure for advances on construction mortgage loans; P.A. 87-436 added references to municipal developers in Subsecs. (b) and (c).

      Sec. 8-253a. Additional loan conditions. In addition to the terms and conditions set forth in section 8-253, loans made by the authority hereunder shall also be subject to the following terms and conditions:

      (1) A loan hereunder may be prepaid after a period of twenty years or sooner with the permission of the authority; provided, nonprofit mortgagors and mortgagors to whom loans are made on or after October 1, 1978, may prepay their loans prior to maturity only with the consent of the authority. The authority shall grant such consent if it finds (A) that it may reasonably be expected that the prepayment of the loan will not result in a material escalation of rents charged to occupants of the project; and (B) that the need for low and moderate income housing in the area concerned is no longer acute.

      (2) The interest rate on the loan shall be established by the authority at the lowest level consistent with the authority's cost of operation and its responsibilities to the holders of its bonds, bond anticipation notes and other obligations, except those loans made pursuant to subsection (32) of section 8-250.

      (3) The authority shall require the mortgagor or its contractor to post labor and materials and construction performance surety bonds, or enter into an escrow arrangement acceptable to the authority, in amounts related to the project cost as established by regulation, and to execute such other assurances and guarantees as the authority may deem necessary.

      (4) The loan shall be subject to an agreement between the authority and the mortgagor which will subject said mortgagor and its principals or stockholders to limitations established by the authority as to rentals, carrying charges, and other charges, profits and fees, and the disposition of its property and franchises to the extent more restrictive limitations are not provided in the law under which the mortgagor is incorporated or organized.

      (5) A loan to a mortgagor, other than a municipal developer or a nonprofit corporation having as one of its purposes the construction or rehabilitation of housing, shall be subject to an agreement between the authority and the mortgagor limiting the mortgagor, and its principals or stockholders, to such return on the mortgagor's equity in any project assisted with a loan from the authority as may be established or permitted by the authority. The mortgagor's equity in a project shall consist of the difference between the amount of the loan and the total project cost, whether or not such costs have been paid in cash or in a form other than cash. With respect to every project, the authority shall, pursuant to rules and regulations adopted by it, establish the mortgagor's equity after the acceptance as proper by the authority of the certification or other assurances of project cost from the mortgagor, provided in no case shall such figure ever be less than the mortgagor's original equity in such project.

      (6) No loan shall be executed, except a loan made to a municipal developer or a nonprofit corporation having as one of its purposes the construction or rehabilitation of housing, unless the mortgagor agrees (A) to certify upon completion of project construction or rehabilitation, subject to audit by the authority, either that the actual project cost as defined herein exceeded the amount of the loan proceeds by ten per cent or more, or the amount by which the loan proceeds exceed ninety per cent of total project cost, and (B) to pay forthwith to the authority, for application to reduction of principal of the loan, the amount, if any, of such excess loan proceeds, subject to audit and determination by the agency. No loan shall be made to a municipal developer or a nonprofit corporation unless such mortgagor agrees to certify the actual project cost upon completion of the project, and further agrees to pay forthwith to the authority, for application to reduction of the principal of the loan, the amount, if any, by which the proceeds of the loan exceed the certified project cost, subject to audit and determination by the authority. Notwithstanding the provisions of this subsection, the authority may accept, in lieu of any certification of project cost as provided herein, such other assurances of the said project cost, in any form or manner whatsoever, as will enable the authority to determine with reasonable accuracy the amount of said project cost.

      (7) As a condition of the loan, the authority shall have the power at all times during the construction and rehabilitation of a housing project and the operation thereof: (A) To enter upon and inspect without prior notice any project, including all parts thereof, for the purpose of investigating the physical and financial condition thereof, and its construction, rehabilitation, operation, management and maintenance, and to examine all books and records with respect to capitalization, income and other matters relating thereto and to make such charges as may be required to cover the cost of such inspections and examinations; (B) to order such alterations, changes or repairs as may be necessary to protect the security of its investment in a housing project or for the health, safety and welfare of the occupants thereof; (C) to order any managing agent, project manager or owner of a housing project to do such acts as may be necessary to comply with the provisions of all applicable laws and ordinances or any rule or regulation of the authority or the terms of any agreement concerning the said project or to refrain from doing any act in violation thereof and in this regard the authority shall be a proper party to file a complaint and to prosecute thereon for any violation of laws or ordinances as set forth herein; (D) to require the adoption and continuous use of uniform systems of accounts and records for a project and to require all owners or managers of same to file annual reports containing such information and verified in such manner as the authority shall require and to file at such times and on such forms as the authority may prescribe reports and answers to specific inquiries of the authority to determine the extent of compliance with any agreement, the terms of the loan, the provisions of this chapter and any other applicable law; and (E) to enforce, by court action if necessary, the terms and provisions of any agreement between the authority and the mortgagor as to schedules of rentals or carrying charges, aggregate family income limits as applied to applicants for housing or the occupants thereof, or any other limitation imposed upon the mortgagor as to financial structure, construction, operation, or disposition of the housing.

      (8) If, pursuant to subsection (29) of section 8-250, the authority appoints a majority of new directors to the board of directors of a mortgagor corporation, or appoints a new managing agent for an unincorporated association, the persons so appointed need not be stockholders or partners or meet other qualifications which may be prescribed by the articles of incorporation or other basic documents of organization or the bylaws of such mortgagor. In the absence of fraud or bad faith, the persons so appointed shall not be personally liable for the debts, obligations or liabilities of such mortgagor; and shall serve only for a period coexistent with the duration of the reasons for their appointment or until the authority is assured, in a manner satisfactory to it, that the need for such service no longer exists; and they shall serve as directors or managing agents for such compensation as the authority may determine and shall be entitled to be reimbursed for all necessary expenses incurred in the discharge of their duties as directors or managing agents of such mortgagor.

      (1972, P.A. 208, S. 8; P.A. 74-104, S. 11, 12; P.A. 75-465, S. 5, 7; P.A. 77-316, S. 6; P.A. 78-150; P.A. 81-472, S. 5, 159; P.A. 84-110, S. 1, 2; P.A. 87-436, S. 19, 23.)

      History: P.A. 74-104 replaced "and" in the phrase "having as one of its purposes the construction and rehabilitation of housing" with the word "or" in Subdiv. (5); P.A. 75-465 excepted loans made pursuant to Sec. 8-250(ff) from provisions of Subdiv. (2); P.A. 77-316 amended Subdiv. (5) to replace 6% limit on investment return with "such a return ... as may be established or permitted by the authority" and replaced provision for establishment of equity at the time of final construction loan advance with provision that equity be established "after the acceptance as proper by the authority of the certification or other assurances of project cost from the mortgagor" and deleted Subdiv. (7) re reduction of rents when earned surplus exceeds 10%, renumbering subsequent Subdivs. accordingly; P.A. 78-150 allowed mortgagors receiving loans on and after October 1, 1978, to pay loans prior to maturity only with authority's consent; P.A. 81-472 made technical changes; P.A. 84-110 amended Subdiv. (5) to provide for variation in the mortgagor's equity; P.A. 87-436 added references to municipal developers in Subdivs. (5) and (6); (Revisor's note: In 1989 a reference in Subdiv. (2) to Subdiv. "(ff)" of Sec. 8-250 was changed editorially by the Revisors to Subdiv. "(32)" to conform with changes made to said section by the Revisors for consistency with customary statutory usage).

      Subdiv. (1):

      Authorized authority, in the absence of facts requiring authority's consent under section, to approve or deny consent for prepayment of loans made under Ch. 134 and is consistent with its broad provisions. 281 C. 227. Legislature gave the authority sole discretion to determine whether mortgagor met requirements necessary to receive consent to prepay mortgage, and the authority properly determined that "the area concerned", for purposes of apartment building in Middletown, was the Hartford metropolitan statistical area. 294 C. 639.

      Sec. 8-254. Applications for mortgage insurance. All applications for mortgage insurance shall be forwarded, together with an application fee prescribed by the authority, to the executive director of the authority. The authority shall cause an investigation of the proposed housing to be made, review the application and the report of the investigation, and approve or deny the application. No application shall be approved unless the authority finds that it is consistent with the purposes of this chapter and further finds that the financing plan for the proposed housing is sound. The authority shall notify the applicant and the proposed lender of its decision. Any such approval shall be conditioned upon payment to the authority, within such reasonable time and after notification of approval as may be specified by the authority, of the commitment fee prescribed by the authority.

      (1969, P.A. 795, S. 14.)

      Sec. 8-254a. Tenant selection plans of mortgagors. Prior to making a commitment for a mortgage loan or mortgage insurance under this chapter, the authority shall approve a tenant selection plan submitted by the applicant mortgagor. The authority shall adopt and publish regulations from time to time governing the terms of such tenant selection plans. Such plans shall include aggregate family income limits for initial admission and continued occupancy, which may vary with family size and the municipality in which such housing is located; the computation of aggregate family income for the purpose of determining eligibility for occupancy; and procedures relating to tenants whose incomes exceed continued occupancy limits. To the extent possible and consistent with project feasibility, income limits shall be sufficiently flexible to avoid undue economic homogeneity among the tenants of the proposed housing. In the event that a department, agency or instrumentality of the United States or this state participates in the financing of the proposed housing, the regulations of such department, agency or instrumentality shall supersede the terms of the tenant selection plan, to the extent to which they are inconsistent therewith, as to those dwelling units in the proposed housing which are so financed or assisted. Tenant selection plans shall provide that, as between tenants equally in need and eligible for occupancy of a dwelling unit, preference shall be given to families and persons displaced by natural disaster or governmental action, pursuant to such regulations as the authority may adopt and publish.

      (1972, P.A. 208, S. 12.)

      Sec. 8-255. Mortgage insurance premiums. The authority shall fix mortgage insurance premiums for the insurance of mortgage payments under the provisions of this chapter. Such premiums shall be computed as a percentage of the principal of the mortgage outstanding at the beginning of each mortgage year, but shall not be more than one-half of one per cent per year of such principal amount. The amount of premium need not be uniform for all insured loans. Such premiums shall be payable by mortgagors or mortgagees in such manner as prescribed by the authority.

      (1969, P.A. 795, S. 16.)

      Sec. 8-256. Default by mortgagor and subsequent action. (a) In the event of default by the mortgagor, the mortgagee shall notify the authority both of the default and the mortgagee's proposed course of action. When it appears feasible, the authority may for a temporary period upon default or threatened default by the mortgagor authorize mortgage payments to be made by the authority to the mortgagee which payments shall be repaid under such conditions as the authority may prescribe. The authority may also agree to revised terms of financing when such appear prudent. The mortgagee shall be entitled to receive the benefits of the insurance provided herein upon: (1) Any sale of the mortgaged property by court order in foreclosure or a sale with the consent of the authority by the mortgagor or a subsequent owner of the property or by the mortgagee after foreclosure or acquisition by deed in lieu of foreclosure, provided all claims of the mortgagee against the mortgagor or others arising from the mortgage, foreclosure, or any deficiency judgment shall be assigned to the authority without recourse except such claims as may have been released with the consent of the authority; or (2) the expiration of six months after the mortgagee has taken title to the mortgaged property under judgment of strict foreclosure, foreclosure by sale or other judicial sale, or under a deed in lieu of foreclosure if during such period the mortgagee has made a bona fide attempt to sell the property, and thereafter conveys the property to the authority with an assignment, without recourse, to the authority of all claims of the mortgagee against the mortgagor or others arising out of the mortgage foreclosure, or deficiency judgment; or (3) the acceptance by the authority of title to the property or an assignment of the mortgage, without recourse, to the authority, in the event the authority determines it imprudent to proceed under (1) or (2) above. Upon the occurrence of either (1), (2) or (3) hereof, the obligation of the mortgagee to pay premium charges for insurance shall cease, and the authority shall, within thirty days thereafter, pay to the mortgagee ninety-eight per cent of the sum of (i) the then unpaid principal balance of the insured indebtedness, (ii) the unpaid interest to the date of conveyance or assignment to the authority, as the case may be, (iii) the amount of all payments made by the mortgagee for which it has not been reimbursed for taxes, insurance, assessments and mortgage insurance premiums, and (iv) such other necessary fees, costs or expenses of the mortgagee as may be approved by the authority.

      (b) Upon request of the mortgagee, the authority may at any time, under such terms and conditions as it may prescribe, consent to the release of the mortgagor from his liability or consent to the release of parts of the property from the lien of the mortgage, or approve a substitute mortgagor or sale of the property or part thereof.

      (c) No claim for the benefit of the insurance provided in this chapter shall be accepted by the authority except within one year after any sale or acquisition of title of the mortgaged premises described in subdivision (1) or (2) of subsection (a) of this section.

      (1969, P.A. 795, S. 15.)

      Sec. 8-257. Mortgages insured by authority to be legal investments. Certificate of title required. (a) Loans secured by mortgages the payments of which are insured by the authority shall be legal investments, for all trust companies, banks, investment companies, savings banks, building and loan associations, executors, administrators, guardians, conservators, trustees and other fiduciaries, and pension, profit-sharing and retirement funds. For the purpose of determining the percentage of capital, surplus, assets or deposits which may be invested therein by an institution under the supervision of the Banking Commissioner, such loans shall be treated similarly to loans insured or to be insured by the Federal Housing Administrator. Otherwise, such loans shall not be subject to limitations, conditions or restrictions imposed by law except as provided by this chapter.

      (b) The property, real or personal, securing such loans shall be unencumbered except for reservations to the United States of America of fissionable materials and for leases, easements and, in the case of insured second mortgages, prior liens to the extent deemed appropriate by the authority. A certificate of title issued by some suitable person approved by the mortgagee or a policy of title insurance shall be lodged with the mortgagee until the mortgage loan is paid. Loans for construction or rehabilitation shall provide for advances at the discretion of the lender as the work progresses and shall not exceed the amount of the advance commitment to insure without the consent of the authority.

      (1969, P.A. 795, S. 17; P.A. 77-614, S. 161, 610; P.A. 80-482, S. 14, 348; P.A. 87-9, S. 2, 3; P.A. 03-84, S. 9.)

      History: P.A. 77-614 substituted banking commissioner for bank commissioner and made banking department a division within the department of business regulation, effective January 1, 1979; P.A. 80-482 deleted reference to abolished department of business regulation in Subsec. (a); (Revisor's note: Pursuant to P.A. 87-9, "banking commissioner" was changed editorially by the Revisors to "commissioner of banking"); P.A. 03-84 changed "commissioner of banking" to "Banking Commissioner" in Subsec. (a), effective June 3, 2003.

      Sec. 8-258. Housing Mortgage Capital Reserve Fund, additional capital reserve funds, Housing Mortgage General Fund and Housing Mortgage Insurance Fund. (a) The authority shall establish and maintain three funds: The Housing Mortgage Capital Reserve Fund, the Housing Mortgage General Fund and the Housing Mortgage Insurance Fund.

      (1) The Housing Mortgage Capital Reserve Fund shall consist of (A) all moneys paid by the state for inclusion therein; (B) all proceeds of the sale of bonds required to be deposited therein by the terms of the resolution authorizing the sale of said bonds; and (C); any other moneys available to the authority which it determines to utilize for this purpose. All moneys held in the Housing Mortgage Capital Reserve Fund, except as hereinafter provided, shall be used for the payment of the principal and interest of any bonds or notes issued by the authority, as such payment shall become due and for the retirement of bonds upon maturity and when due. In addition, moneys from the fund may be used to retire bonds before maturity and to pay any redemption premium required to be paid, provided no moneys shall be utilized in any year to retire bonds before maturity if the consequence thereof is to reduce the fund below an amount of moneys sufficient to meet the maximum payments required in the succeeding calendar year for payment of principal and interest falling due on all other outstanding bonds and retiring all other bonds required by their terms to be retired, such amount being hereafter referred to as the "required minimum capital reserve". Income or interest from the investment of moneys held in the fund shall be retained therein if needed to meet any deficiencies in the required minimum capital reserve but, to the extent of any excess over the aforesaid required minimum capital reserve, moneys may be transferred by the authority to any other fund or account of the authority. Notwithstanding any other provision contained in this chapter, no bonds shall be issued by the authority unless there is in the fund the required minimum capital reserve for all bonds issued and to be issued, provided nothing shall preclude the authority from satisfying the foregoing requirement by depositing so much of the proceeds of the bonds to be issued, upon their issuance as is needed for the fund to achieve the required minimum capital reserve. On or before December first of each year, there is deemed to be appropriated from the state General Fund such sums, if any, as shall be certified by the chairman of the authority, to the Secretary of the Office of Policy and Management, as necessary to restore said fund to an amount equal to the required minimum capital reserve, and such amounts shall be allotted and paid to the authority. Such amounts, if any, shall be repaid to the state and credited to the General Fund, subject to the provisions of section 8-261 and to any general resolution adopted prior to May 18, 1972, by the authority authorizing the issuance of bonds, as soon as possible, by the authority from any moneys available therefor and in excess of the amounts which the authority determines will keep it self-supporting. For purposes of valuation of the Housing Mortgage Capital Reserve Fund, securities acquired as an investment for said fund shall be valued at par, actual cost to the authority or market value, whichever value is less.

      (2) The authority may also establish one or more additional capital reserve funds in connection with the issuance of any bonds pursuant to a resolution other than its general housing mortgage program bond resolution adopted October 27, 1972. Any such capital reserve fund shall be established and maintained on the same terms and conditions as the Housing Mortgage Capital Reserve Fund, and amounts shall be deposited and maintained therein, expended therefrom and are hereby appropriated thereto in the same manner and with the same force and effect as is provided in subdivision (1) of subsection (a) of this section with respect to the Housing Mortgage Capital Reserve Fund, it being hereby expressly provided that the operation of any such capital reserve fund shall be identical to the operation of the Housing Mortgage Capital Reserve Fund, except as follows: When computing the amount on deposit in any such capital reserve fund, investments therein shall be valued at par, cost, amortized value or such other method as the authority determines to be reasonable and in the best interests of the state and the holders of the bonds entitled to the benefits thereof; and in calculating the required "minimum capital reserve" with respect to such capital reserve fund there shall be taken into account only those bonds of the authority secured by such capital reserve fund and in computing the "required minimum capital reserve" pursuant to subdivision (1) of subsection (a) of this section, such bonds shall not be taken into account in determining the amount of outstanding and other bonds. The provisions of section 8-261 shall be applicable to this subdivision.

      (3) The Housing Mortgage General Fund shall consist of (A) all proceeds of the sale of bonds issued by the authority not required to be deposited in the Housing Mortgage Capital Reserve Fund by the terms of the resolution authorizing the sale of said bonds; (B) all moneys paid by the state of Connecticut for inclusion therein; (C) any moneys not allocated to any fund; (D) any moneys which the authority shall transfer from the Housing Mortgage Capital Reserve Fund pursuant to subdivision (1) of subsection (a) of this section; and (E) any other moneys available to the authority which it determines to utilize for this purpose. To the extent available, after paying all operating costs of the authority except moneys required for the Housing Mortgage Capital Reserve Fund and the Housing Mortgage Insurance Fund, the moneys remaining in the General Fund may be used for the payment of the principal of and interest on the bonds issued by the authority or for such other corporate purposes of the authority as are authorized by this chapter.

      (4) The Housing Mortgage Insurance Fund shall consist of (A) all receipts of mortgage insurance premiums, (B) all money or other assets of whatever nature received by the authority as a result of loan defaults or delinquencies, including proceeds from the sale, lease or rental of real property, (C) all moneys lent or paid by the state for inclusion therein and (D) any other moneys available to the authority which it determines to include therein. From said funds shall be paid all payments required by loan defaults and all direct expenses and payments for the protection of the interest of the authority in connection with delinquent or defaulted insured mortgages or property acquired as a result thereof. Loans and advances may be made from said funds as provided by section 8-250.

      (b) Notwithstanding the provisions of subdivisions (1) to (3), inclusive, of subsection (a) of this section, the authority may establish accounts in the funds established under said subdivisions or such additional alternative or further funds and accounts thereof, which may include the proceeds of bonds, and may establish other capital reserve funds on the same terms and conditions and with the same force and effect resulting from the provisions of subdivision (1) of subsection (a) of this section, except that securities acquired as an investment of any such fund shall be valued in such reasonable manner as the authority shall determine, all as may be, in its discretion, necessary and desirable to accomplish any purpose of the authority or to comply with the provisions of any agreement made by the authority or any resolution approved by the authority. The resolution establishing such a fund and accounts shall specify the source of moneys from which such funds or accounts shall be funded and the purposes for which moneys held in the funds and accounts shall be disbursed.

      (c) Moneys in any of the funds referred to in this section not needed to meet expenses may be invested in the manner provided in subsection (18) of section 8-250.

      (d) Subject to any agreement or agreements with holders of outstanding bonds, notes or other obligations, the authority may apply moneys in the Housing Mortgage Capital Reserve Fund, any additional capital reserve fund or the Housing Mortgage General Fund to purchase a financial guaranty or financial guaranties secured or unsecured as the authority may determine. For purposes of this section, financial guaranty means any letter of credit, surety bonds, insurance policy, guaranty or similar instrument issued by a bond or insurance company or other financial institution which provides for moneys to be available for the purposes to which and at the times by which moneys in each such fund may be required.

      (e) Secure instruments or contracts authorized under subsection (38) of section 8-250 in any manner in which the authority may secure its bonds, notes or other obligations under section 8-252, subject to any agreement or agreements with holders of outstanding bonds, notes or other obligations of the authority.

      (f) The State Treasurer is hereby authorized to issue a collateralized direct guarantee of the state of punctual payment thereof from the General Fund and carrying the full faith and credit pledge of the state for any investment of the authority or financial guarantee purchased by the authority to the extent such investment or financial guarantee has a rating equal to or better than that of the state provided the state is fully secured by a collateral assignment of such investment or financial guarantee and such investment or financial guarantee qualifies as an investment by the Short-Term Investment Fund under section 3-27a. The amount necessary to honor such state collateralized guarantee is hereby deemed appropriated from the General Fund and the Treasurer is authorized and directed to sell and collect on the security of the collateral so assigned and to pay such amount to the authority. Such state collateralized guarantee shall not constitute indebtedness of the state for the purposes of any debt limit of other statutory purpose and shall be only placed on any such investment or financial guarantee to permit the authority to maximize its investment opportunities and to meet its responsibilities under the requirements of its general housing mortgage finance program bond resolution adopted September 27, 1972, as amended, provided the State Treasurer determines that the collateral is at least sufficient to offset the full amount of the state guarantee. The State Treasurer shall be entitled to such supporting documents as necessary or appropriate from the authority prior to placing such collateralized guarantee on any such investment.

      (1969, P.A. 795, S. 18; 1972, P.A. 208, S. 13; P.A. 76-13, S. 5, 7; 76-118, S. 5, 6; P.A. 77-316, S. 5; 77-614, S. 19, 610; P.A. 79-631, S. 44, 111; P.A. 81-472, S. 6, 159; P.A. 93-33, S. 2, 4; 93-125, S. 2, 3; P.A. 96-180, S. 10, 166.)

      History: 1972 act added provision requiring repayment to general fund by authority of amounts taken from general fund to cover deficiencies in required minimum capital reserve in Subsec. (a) and changed reference to Subsec. (o) of Sec. 8-250 in Subsec. (e) to "subsection (r) of section 8-250"; P.A. 76-13 inserted new Subsec. (b) concerning additional capital reserve funds and relettered remaining Subsecs. accordingly; P.A. 76-118 amended Subsec. (e), formerly Subsec. (d), to allow establishment of alternative accounts and funds; P.A. 77-316 amended Subsec. (d) to include in housing mortgage insurance fund "any other moneys available to the authority" and to allow loans and advances from fund; P.A. 77-614 substituted secretary of the office of policy and management for commissioner of finance and control; P.A. 79-631 and P.A. 81-472 made technical changes; (Revisor's note: In 1989 a reference in Subsec. (e) to Subdiv. "(r)" of Sec. 8-250 was changed editorially by the Revisors to Subdiv. "(18)" to conform with changes made to said section by the Revisors for consistency with customary statutory usage); P.A. 93-33 added Subsecs. (g) and (h) authorizing the authority to apply moneys in any special capital reserve fund or any other fund of the authority to purchase a financial guaranty or guarantees, effective April 20, 1993; P.A. 93-125 added Subsec. (i) to allow the treasurer to issue a direct collateralized guarantee of the state of punctual payment from the general fund for investments or guarantees of the authority, effective June 11, 1993; P.A. 96-180 conformed Subsec., Subdiv. and Subpara. designators to customary statutory usage, effective June 3, 1996.

      Sec. 8-259. State bonds. The State Bond Commission may authorize the issuance of bonds of the state in one or more series in accordance with section 3-20 and in principal amounts necessary to carry out the purposes of this chapter but not in excess of the aggregate amount of one million dollars. All of said bonds shall be payable at such place or places as may be determined by the Treasurer pursuant to section 3-19 and shall bear such date or dates, mature at such time or times, bear interest at such rate or different or varying rates, be payable at such time or times, be in such denominations, be in such form with or without interest coupons attached, carry such registration and transfer privileges, be payable in such medium of payment and be subject to such terms of redemption with or without premium as, irrespective of the provisions of said section 3-20, may be provided by the authorization of the State Bond Commission or fixed in accordance therewith. The proceeds of the sale of such bonds, after deducting therefrom all expenses of issuance and sale, shall be paid to the authority and deposited in the Housing Mortgage Capital Reserve Fund, Housing Mortgage Insurance Fund and the Housing Mortgage General Fund in such manner as the State Bond Commission shall determine, provided not more than one million dollars shall be deposited in the Housing Mortgage Insurance Fund and not more than an aggregate amount of four million dollars shall be deposited in the Housing Mortgage Capital Reserve Fund and Housing Mortgage General Fund. When the State Bond Commission has acted to issue such bonds or a portion thereof, the Treasurer may, pending the issue of such bonds, issue, in the name of the state, temporary notes in anticipation of the money to be received from the sale of such bonds.

      (1969, P.A. 795, S. 19; May Sp. Sess. P.A. 94-2, S. 7, 203.)

      History: May Sp. Sess. P.A. 94-2 decreased bond authorization from $5,000,000 to $1,000,000, effective July 1, 1994.

      Sec. 8-260. Reports to Governor and General Assembly. Audit. Within the first ninety days of each calendar year, the authority shall report on its operations for the preceding calendar year to the Governor. The authority shall make a report to the General Assembly on or before March fifteenth in each year that the General Assembly meets in general session. The report shall include a summary of the activities of the authority, a complete operating and financial statement and recommendations for legislation to promote the purposes of the authority. The accounts of the authority shall be subject to annual audits by the State Auditors of Public Accounts.

      (1969, P.A. 795, S. 20; P.A. 76-13, S. 6, 7; 76-41, S. 2, 3; P.A. 97-36, S. 1.)

      History: P.A. 76-13 changed report deadline from January to February fifteenth in each year; P.A. 76-41 deleted requirement that report be made to bank commissioner and that authority be subject to examination by bank commissioner although not considered a bank or banking institution; P.A. 97-36 changed report deadline from February to March fifteenth in each year.

      Sec. 8-261. Pledge by state as to limitation or alteration of rights vested in authority. The state of Connecticut does hereby pledge to and agree with the holders of any obligations issued under this chapter, and with those parties who may enter into contracts with the authority pursuant to the provisions of this chapter, that the state will not limit or alter the rights hereby vested in the authority until such obligations, together with the interest thereon, are fully met and discharged and such contracts are fully performed on the part of the authority, provided nothing herein contained shall preclude such limitation or alteration if and when adequate provision shall be made by law for the protection of the holders of such obligations of the authority or those entering into such contracts with the authority. The authority as agent for the state is authorized to include this pledge and undertaking for the state in such obligations or contracts.

      (1969, P.A. 795, S. 21.)

      Sec. 8-262. Interpretation of powers. The powers enumerated in this chapter shall be interpreted broadly to effectuate the purposes thereof and shall not be construed as a limitation of powers.

      (1969, P.A. 795, S. 22.)

      Sec. 8-262a. Penalty for false statement. The Connecticut Housing Finance Authority may require any application or document submitted with respect to any program of, or program administered by, said authority to be signed under penalty of false statement as provided in section 53a-157b.

      (P.A. 99-245, S. 1.)

      Sec. 8-263. Provisions controlling over inconsistent law. To the extent that the provisions of this chapter are inconsistent with the provisions of any general statute or special act or parts thereof, the provisions of this chapter shall be deemed controlling.

      (1969, P.A. 795, S. 23.)

      Secs. 8-264 and 8-265. Purchase of or loans on mortgages insured by state agencies. Bond issue. Sections 8-264 and 8-265 are repealed.

      (1971, P.A. 840, S. 4, 5; June, 1971, P.A. 1, S. 2, 3; 1972, P.A. 208, S. 14.)

      Sec. 8-265a. Land of authority subject to local regulation. All land and improvements owned by the authority or in which the authority has an interest through a mortgage held or insured by it shall be subject to the planning, zoning, health and building laws, ordinances and regulations applicable to the town in which such land and improvements are situated, provided, as to land owned by the authority, the authority shall have the same rights of appeal and review from an adverse decision or order based on such laws, ordinances and regulations as are granted by such laws, ordinances and regulations to other owners.

      (1972, P.A. 208, S. 9.)

      Sec. 8-265b. Tax-exempt status of authority. Payment in lieu of taxes. The real and personal property of the authority, and its income and operations, shall be exempt from taxation by the state and any political subdivision thereof, except that the authority shall make payments in lieu of taxes on real and personal property it acquires in any project in an amount equal to the taxes that would be paid on such property were the same not exempt from taxation hereunder, unless agreement is reached with a municipality for payment of a lesser amount. The authority shall have the same right of appeal from any assessment made on real and personal property as any person. In the event the authority acquires real or personal property in a project the authority shall succeed to the interests of its predecessor in title in any agreement concerning the abatement of taxes on the property.

      (1972, P.A. 208, S. 10.)

      Sec. 8-265c. Discrimination re housing financed by authority barred. The authority shall require that occupancy of all housing financed or otherwise assisted under this chapter be open to all persons regardless of race, creed, color, national origin or ancestry, or sex and that the contractors and subcontractors engaged in the construction or rehabilitation of such housing shall take affirmative action to provide equal opportunity for employment without discrimination as to race, creed, color, national origin or ancestry, or sex.

      (1972, P.A. 208, S. 11.)

      Sec. 8-265d. Mortgage assistance for households with incomes below eighty per cent of the area median income. Section 8-265d is repealed, effective October 1, 2002.

      (P.A. 90-257, S. 9, 17; P.A. 95-250, S. 1; P.A. 96-211, S. 1, 5, 6; S.A. 02-12, S. 1.)

      Sec. 8-265e. Annual study of current market rent levels. Section 8-265e is repealed, effective July 1, 1995.

      (P.A. 90-257, S. 16, 17; P.A. 95-250, S. 41, 42; 95-309, S. 10-12.)

      Sec. 8-265f. Program for use of interest earned on real estate broker escrow or trust accounts for mortgage assistance. (a) A program for the use of interest earned on real estate broker escrow or trust accounts is hereby established. Each real estate broker having an escrow or trust account under section 20-324k shall participate in such program. Under the program, moneys held on behalf of any principal, client or other person shall be deposited by participating real estate brokers in interest-bearing accounts specifically established pursuant to this program. Funds deposited in such accounts shall be subject to withdrawal upon request by the depositor and without delay, provided the funds are available in accordance with federal regulations. The interest earned thereon shall be paid to the Connecticut Housing Finance Authority for the purposes of section 8-265g. Nothing in this section shall prevent a real estate broker from depositing the funds of any principal, client or other person, regardless of the amount of such funds or the period for which such funds are expected to be held, in a separate interest-bearing account established on behalf of and for the benefit of the principal, client or person. The Connecticut Housing Finance Authority shall mail to each real estate broker participating in the program a detailed annual report of the mortgage assistance provided pursuant to section 8-265g.

      (b) This program shall not require the banking corporations or financial institutions receiving such funds, holding such accounts and paying interest thereon to the depositors of the account to perform any additional administrative functions or assume any additional responsibilities or obligations in connection with such program or the accounts so maintained. The provisions of this section shall not apply to any escrow account established and maintained pursuant to section 47a-21. Nothing in this section shall be construed to impose any additional obligations on real estate brokers other than those contained in subsection (a) of this section.

      (P.A. 91-314, S. 1, 4; P.A. 92-69, S. 2, 5.)

      History: P.A. 92-69 deleted provisions from Subsec. (a) limiting deposits to moneys less than $10,000 or expected to be held for not more than 60 business days.

      Sec. 8-265g. Mortgage assistance for low or moderate income families or persons. (a) The Connecticut Housing Finance Authority, in consultation with the advisory panel established under section 8-265h, shall develop and administer a program of mortgage assistance to low or moderate income families or persons, as defined in section 8-243. In making mortgage assistance available under the program, the authority shall utilize down payment assistance or any other appropriate housing subsidies. The terms of any mortgage assistance shall allow the mortgagee to realize a reasonable portion of the equity gain upon sale of the mortgaged property.

      (b) On or before March 15, 1998, and annually thereafter, the authority shall submit a report on the program to the advisory panel established pursuant to section 8-265h.

      (P.A. 91-314, S. 2, 4; P.A. 92-69, S. 3, 5; P.A. 97-36, S. 2.)

      History: P.A. 92-69 deleted provisions from Subsec. (a) limiting eligibility to first-time homebuyers who do not have a down payment or sufficient annual income to qualify for existing mortgage assistance programs; P.A. 97-36 changed annual report deadline in Subsec. (b) from January first to March fifteenth.

      Sec. 8-265h. Housing advisory panel. (a) An advisory panel shall be established to perform the functions described in subsection (b) of this section consisting of eight members to be selected as follows: Two members shall be appointed by the Governor, one of whom shall be an executive director of a nonprofit corporation which provides housing in this state and one of whom shall be a realtor; four members shall be appointed by the cochairpersons of the select committee of the General Assembly having cognizance of matters relating to housing, two of whom may be the cochairpersons of said committee and two of whom may be members of the General Assembly and two members shall be appointed by the ranking member of the House of Representatives of the select committee of the General Assembly having cognizance of matters relating to housing. Each member of the panel shall serve for a term which is coterminous with the term of his appointing authority. A vacancy shall be filled by the original appointing authority for the balance of the unexpired term.

      (b) The advisory panel shall: (1) Consult with and make recommendations to the Connecticut Housing Finance Authority regarding the implementation and administration of the mortgage assistance program established pursuant to section 8-265g, including the methods of allocation and the allocation of funds to be disbursed under such program; (2) review and evaluate, and monitor the impact of the program; and (3) report on the program to the General Assembly as may from time to time be requested.

      (P.A. 91-314, S. 3, 4.)

      Sec. 8-265i. Reverse annuity mortgage program. (a) The Connecticut Housing Finance Authority shall implement a program under which reverse annuity mortgages may be issued to homeowners seventy years of age or older in need of long-term care to remain in their homes and to avoid entering a nursing home.

      (b) Any mortgage shall be for a term of not more than six years. The Connecticut Housing Finance Authority shall establish written procedures, in accordance with section 1-121, setting forth eligibility criteria for homeowners and specifying medical and other costs that may be covered by loan payments.

      (c) The Connecticut Housing Finance Authority shall not foreclose on any home with respect to which a loan has been made pursuant to this section as long as the homeowner to whom such loan was made continues to reside in such home. The Connecticut Housing Finance Authority shall, from its own resources, repay loans on properties not sold at the termination of the loan agreement with the owner due to the continued residence of such owner in such property.

      (June Sp. Sess. P.A. 93-1, S. 40, 45; P.A. 06-196, S. 48; P.A. 10-32, S. 20.)

      History: June Sp. Sess. P.A. 93-1 effective July 1, 1993; P.A. 06-196 made a technical change in Subsec. (c), effective June 7, 2006; P.A. 10-32 made a technical change in Subsec. (b), effective May 10, 2010.

      Secs. 8-265j to 8-265n. Reserved for future use.

      Sec. 8-265o. Definitions. As used in this section and sections 8-265p to 8-265v, inclusive:

      (1) "Authority" means the Connecticut Housing Finance Authority as created under section 8-244;

      (2) "Mortgage" means a mortgage deed or other instrument which constitutes a first or second consensual lien on one, two or three-family owner-occupied residential real property, including single-family units in a common interest community, located in this state;

      (3) "Mortgagee" means mortgage lenders authorized to originate mortgage loans in this state; and

      (4) "Mortgagor" means the owner-occupant of one, two or three-family residential real property located in this state who is also the borrower under a mortgage encumbering such real property.

      (P.A. 93-308, S. 3, 12; 93-435, S. 94, 95.)

      History: P.A. 93-308 effective July 1, 1993; P.A. 93-435 changed effective date of P.A. 93-308 from July 1, 1993, to June 9, 1993, effective June 28, 1993.

      Sec. 8-265p. Residential mortgage refinancing guarantee program. The authority shall establish, within the resources allocated by the State Bond Commission to the Department of Economic and Community Development for the purposes of sections 8-265o to 8-265v, inclusive, a residential mortgage guarantee program. The purpose of the program shall be to enable residential mortgagors to obtain mortgage credit, otherwise unavailable, for the refinancing of existing mortgages. The authority shall implement the program in a manner designed to facilitate the qualifications of the loans guaranteed under the program for sale to one or more secondary mortgage markets for such loans. The authority shall compute the amount of guarantees authorized for the purposes of sections 8-265o to 8-265v, inclusive, on the basis of not more than ten times the resources allocated by the State Bond Commission to the Department of Economic and Community Development for such purposes, including fees received pursuant to section 8-265t.

      (P.A. 93-308, S. 4, 12; 93-435, S. 94, 95; P.A. 95-250, S. 1; P.A. 96-211, S. 1, 5, 6.)

      History: P.A. 93-308 effective July 1, 1993; P.A. 93-435 changed effective date of P.A. 93-308 from July 1, 1993, to June 9, 1993, effective June 28, 1993; P.A. 95-250 and P.A. 96-211 replaced Commissioner and Department of Housing with Commissioner and Department of Economic and Community Development.

      Sec. 8-265q. Mortgagee participation. (a) Mortgage loan guarantees issued by the authority under the provisions of sections 8-265o to 8-265v, inclusive, shall be in the form of a guarantee from the authority to an approved mortgagee. Mortgagees may participate in the program by entering into a mortgage guarantee agreement with the authority. Mortgagees participating in the program shall process and underwrite loan guarantees in accordance with the provisions of sections 8-265o to 8-265v, inclusive, and written procedures adopted thereunder and in accordance with the terms of the mortgage guarantee agreement. No loan guarantee shall be issued after June 30, 1995.

      (b) Any mortgagee seeking a loan guarantee and any mortgagor seeking to have a loan guaranteed shall provide such information to the authority as the authority deems necessary. The information shall be provided on a form prescribed by the authority. Any information required by the authority in connection with an application for a mortgage loan guarantee shall be provided subject to the penalty for false statement under section 53a-157b. No guarantee shall be valid until approved by the authority.

      (P.A. 93-308, S. 5, 12; 93-435, S. 94, 95; P.A. 96-180, S. 11, 166.)

      History: P.A. 93-308 effective July 1, 1993; P.A. 93-435 changed effective date of P.A. 93-308 from July 1, 1993, to June 9, 1993, effective June 28, 1993; P.A. 96-180 amended Subsec. (b) by replacing reference to Sec. 53a-157 with reference to Sec. 53a-157b, effective June 3, 1996.

      Sec. 8-265r. Eligibility of loans. No loan shall be eligible for a guarantee under the program established pursuant to sections 8-265o to 8-265v, inclusive, unless the authority determines that (1) the loan to be guaranteed is a refinancing of existing debt secured by one or more mortgages and is in an amount not exceeding the amount necessary to retire the current balance of existing loans secured by first and second mortgage liens, plus reasonable customary fees and expenses incurred in connection with the refinancing transaction, including the origination fee paid to the authority pursuant to section 8-265t, (2) the mortgagor and the terms of the loan being guaranteed would be approved by the originating lender on terms, conditions and underwriting standards generally applicable for such loans, except that the current appraised value of the real property securing the proposed refinancing does not satisfy the loan to value ratio requirements of the mortgagee and (3) the terms and conditions of the loan are acceptable to the authority.

      (P.A. 93-308, S. 6, 12; 93-435, S. 94, 95.)

      History: P.A. 93-308 effective July 1, 1993; P.A. 93-435 changed effective date of P.A. 93-308 from July 1, 1993, to June 9, 1993, effective June 28, 1993.

      Sec. 8-265s. Amount of guarantee. Record of payments to honor guarantees. Notification to State Treasurer. (a) The maximum amount of any guarantee issued by the authority under the provisions of sections 8-265o to 8-265v, inclusive, shall be in an amount equal to the difference between eighty per cent of the appraised value of the real property securing the loan and the amount of the new loan, provided the maximum amount of any guarantee shall not exceed the difference between eighty per cent of the appraised value of the real property securing the loan and one hundred twenty-five per cent of the appraised value of such real property.

      (b) The guarantee shall secure the mortgagee up to the amount of the guarantee for any loss incurred by the mortgagee because of default of the mortgagor, including losses in principal balance, interest and fees and expenses due to foreclosure.

      (c) The authority shall maintain a record of payments made to honor loan guarantees issued under the provisions of sections 8-265o to 8-265v, inclusive. The authority shall notify the State Treasurer when the cumulative total of such payments equals or exceeds two million dollars. Such notice shall include the total amount of payments made and an estimate of the date that the resources available for the purpose of sections 8-265o to 8-265v, inclusive, will be depleted. When the amounts expended to honor loan guarantees exceed four million dollars, the authority immediately shall cease to issue loan guarantees and shall notify the State Treasurer of the total amount of payments made and that it has ceased issuing loan guarantees. When all funds available for the purposes of sections 8-265o to 8-265v, inclusive, are expended, the State Treasurer shall advance such funds from the General Fund as needed to honor outstanding guarantees as they become due and payable, provided such amount shall not exceed five million dollars. Such funds shall be deemed appropriated for such purposes.

      (P.A. 93-308, S. 7, 12; 93-435, S. 94, 95.)

      History: P.A. 93-308 effective July 1, 1993; P.A. 93-435 changed effective date of P.A. 93-308 from July 1, 1993, to June 9, 1993, effective June 28, 1993.

      Sec. 8-265t. Points. Annual premium. The mortgagor, in consideration of the guarantee from the authority to the mortgagee, shall pay at the time of the closing of the loan being guaranteed an amount equal to two per cent of the amount of the guarantee. Such payment may be included in the amount borrowed in the refinancing transaction which is the subject of the guarantee. The mortgagor shall also pay to the authority an annual premium of one-half of one per cent of the amount of the guarantee. The premium shall be charged annually and paid monthly to the authority. Fees paid pursuant to this section shall be used for the purposes of sections 8-265o to 8-265v, inclusive.

      (P.A. 93-308, S. 8, 12; 93-435, S. 94, 95.)

      History: P.A. 93-308 effective July 1, 1993; P.A. 93-435 changed effective date of P.A. 93-308 from July 1, 1993, to June 9, 1993, effective June 28, 1993.

      Sec. 8-265u. Termination of loan guarantee. The authority may terminate any loan guarantee if the mortgagee misrepresents any information pertaining to the guarantee or fails to comply with any term of the mortgage guarantee agreement in connection with the guarantee of the underlying loan.

      (P.A. 93-308, S. 9, 12; 93-435, S. 94, 95.)

      History: P.A. 93-308 effective July 1, 1993; P.A. 93-435 changed effective date of P.A. 93-308 from July 1, 1993, to June 9, 1993, effective June 28, 1993.

      Sec. 8-265v. Written procedures. Not more than thirty days after June 9, 1993, the authority shall adopt written procedures in accordance with the provisions of section 1-121 to implement sections 8-265o to 8-265v, inclusive.

      (P.A. 93-308, S. 10, 12; 93-435, S. 94, 95.)

      History: P.A. 93-308 effective July 1, 1993; P.A. 93-435 changed effective date of P.A. 93-308 from July 1, 1993, to June 9, 1993, effective June 28, 1993.

      Sec. 8-265w. Bond issue authorized. (a) For the purposes described in subsection (b) of this section, the State Bond Commission shall have the power, from time to time to authorize the issuance of bonds of the state in one or more series and in principal amounts not exceeding in the aggregate five million dollars.

      (b) The proceeds of the sale of said bonds, to the extent of the amount stated in subsection (a) of this section, shall be used by the Department of Economic and Community Development for the purpose of (1) a grant to the Connecticut Housing Finance Authority for the purposes of sections 8-265o to 8-265v, inclusive, and (2) for loans or deferred loans by the Department of Economic and Community Development pursuant to sections 8-283 to 8-289, inclusive. Any proceeds authorized or allocated by the commission for loans or deferred loans pursuant to sections 8-283 to 8-289, inclusive, shall not be deemed to be authorized, allocated or available for the purposes of sections 8-265o to 8-265v, inclusive.

      (c) All provisions of section 3-20, or the exercise of any right or power granted thereby which are not inconsistent with the provisions of this section are hereby adopted and shall apply to all bonds authorized by the State Bond Commission pursuant to this section, and temporary notes in anticipation of the money to be derived from the sale of any such bonds so authorized may be issued in accordance with said section 3-20 and from time to time renewed. Such bonds shall mature at such time or times not exceeding twenty years from their respective dates as may be provided in or pursuant to the resolution or resolutions of the State Bond Commission authorizing such bonds. None of said bonds shall be authorized except upon a finding by the State Bond Commission that there has been filed with it a request for such authorization, which is signed by or on behalf of the Secretary of the Office of Policy and Management and states such terms and conditions as said commission, in its discretion, may require. Said bonds issued pursuant to this section shall be general obligations of the state and the full faith and credit of the state of Connecticut are pledged for the payment of the principal of and interest on said bonds as the same become due, and accordingly and as part of the contract of the state with the holders of said bonds, appropriation of all amounts necessary for punctual payment of such principal and interest is hereby made, and the Treasurer shall pay such principal and interest as the same become due.

      (P.A. 93-308, S. 11, 12; 93-435, S. 94, 95; P.A. 95-1, S. 1, 2; 95-250, S. 1; P.A. 96-211, S. 1, 5, 6.)

      History: P.A. 93-308 effective July 1, 1993; P.A. 93-435 changed effective date of P.A. 93-308 from July 1, 1993, to June 9, 1993, effective June 28, 1993; P.A. 95-1 amended Subsec. (b) to authorize use of proceeds for home ownership loans from the Department of Housing, effective February 1, 1995; P.A. 95-250 and P.A. 96-211 replaced Commissioner and Department of Housing with Commissioner and Department of Economic and Community Development.

      Secs. 8-265x to 8-265aa. Reserved for future use.

      Sec. 8-265bb. Contract for state assistance to authority. (a) For purposes of this section "state assistance" means a payment by the state of actual debt service, comprised of principal, interest, interest rate swap payments, liquidity fees, letter of credit fees, trustee fees and other similar bond-related expenses.

      (b) Not later than July 1, 2008, the state, acting by and through the Secretary of the Office of Policy and Management and the State Treasurer, shall enter into a contract or contracts with the Connecticut Housing Finance Authority that provide for the state to pay to said authority state assistance on bonds issued by said authority for purposes of providing funds for the emergency mortgage assistance program in sections 8-265cc to 8-265kk, inclusive, as an additional purpose pursuant to the provisions of section 8-252 and costs of issuance in an aggregate principal amount not to exceed fifty million dollars. Any provision of such a contract entered into providing for payments equal to annual debt service shall constitute a full faith and credit obligation of the state and as part of the contract of the state with the holders of any bonds or refunding bonds, as applicable, appropriation of all amounts necessary to meet punctually the terms of such contract shall be made and the State Treasurer shall pay such amounts as the same become due. The Connecticut Housing Finance Authority may pledge such state assistance as security for the payment of such bonds or refunding bonds issued by said authority for such purposes. Any bonds so issued by the Connecticut Housing Finance Authority for the emergency mortgage assistance program pursuant to sections 8-265cc to 8-265kk, inclusive, and at any time outstanding, may at any time or from time to time, be refunded, in whole or in part, by the Connecticut Housing Finance Authority by the issuance of its refunding bonds in such amounts as the authority may deem necessary or appropriate but not exceeding an amount sufficient to refund the principal amount of the bonds to be so refunded, any unpaid interest thereon, and any premiums, commissions and costs of issuance necessary to be paid in connection therewith. The state, acting by and through the Office of Policy and Management and the State Treasurer and without further authorization, may execute an amendment to any contract providing state assistance as required in connection with such refunding bonds.

      (c) Notwithstanding any contract entered into by the state with the Connecticut Housing Finance Authority for state assistance, the bonds or refunding bonds to which such state assistance applies shall not constitute bonds or notes issued or guaranteed by the state within the meaning of section 3-21.

      (P.A. 08-176, S. 11.)

      History: P.A. 08-176 effective June 12, 2008.

      Sec. 8-265cc. Definitions. As used in sections 8-265cc to 8-265kk, inclusive:

      (1) "Aggregate family income" means the total income of persons residing in the same household as the mortgagor and any other resident of the household declared by the mortgagor as a dependent for federal tax purposes, from whatever source derived, including, but not limited to, pensions, annuities, retirement benefits and Social Security benefits, provided the authority may exclude from income (A) reasonable allowances for dependents, (B) reasonable allowances for medical expenses, (C) all or any part of the earnings of gainfully employed minors or family members other than the chief wage earner, (D) income not regularly received, and (E) such other expenses as the authority may allow;

      (2) "Authority" means the Connecticut Housing Finance Authority created under section 8-244;

      (3) "Mortgage" means a mortgage deed or other instrument which constitutes a first or second consensual lien on one-to-four family owner-occupied residential real property located in this state, including, but not limited to, a single-family unit in a common interest community;

      (4) "Mortgagee" means the original lender under a mortgage, or its agents, successors, or assigns;

      (5) "Mortgagor" means the owner-occupant of a one-to-four family residential real property located in this state, including, but not limited to, a single family unit in a common interest community, who is also the borrower under a mortgage encumbering such real property;

      (6) "Housing expense" means the sum of the mortgagor's monthly maintenance expense in a common interest community, utility expense, heating expense, hazard insurance payment, taxes and required mortgage payment, including escrows;

      (7) "Financial hardship due to circumstances beyond the mortgagor's control" means a significant reduction of aggregate family household income or increase in expenses which reasonably cannot be or could not have been alleviated by the liquidation of assets by the mortgagor as determined by the Connecticut Housing Finance Authority, including, but not limited to, a reduction resulting from (A) (i) unemployment or underemployment of one or more of the mortgagors; (ii) a loss, reduction or delay in receipt of such federal, state or municipal benefits as Social Security, supplemental security income, public assistance and government pensions; (iii) a loss, reduction or delay in receipt of such private benefits as pension, disability, annuity or retirement benefits; (iv) divorce or a loss of support payments; (v) disability, illness or death of a mortgagor; or (B) (i) a significant increase in the dollar amount of the periodic payments required by the mortgage; (ii) an unanticipated rise in housing expenses; or (iii) expenses related to the disability, illness or death of a member of the mortgagor's family, but does not include expenses related to the accumulation of credit or installment debt incurred for recreational or nonessential items prior to the occurrence of the alleged circumstances beyond the mortgagor's control in an amount that would have caused the mortgagor's total debt service to exceed sixty per cent of aggregate family income at that time;

      (8) "Consumer credit counseling agency" means a nonprofit corporation or governmental agency located in this state which has been designated by the authority to provide homeowners' emergency mortgage assistance program counseling. A qualified consumer credit counseling agency must either be certified as a housing counseling agency by the federal Department of Housing and Urban Development or otherwise determined accepted by the authority;

      (9) "Foreclosure mediation program" means the foreclosure mediation program established by section 49-31m; and

      (10) "Periodic payments" means principal, interest, taxes, insurance and, if applicable, condominium fees.

      (P.A. 93-414, S. 1, 10; P.A. 94-185, S. 1, 10; P.A. 08-176, S. 5; P.A. 09-209, S. 27; 09-219, S. 1.)

      History: P.A. 93-414 effective July 1, 1993; P.A. 94-185 redefined "mortgagee" to clarify the requirement that an assignee must agree to participate in the program, effective June 2, 1994; P.A. 08-176 redefined "mortgage", "mortgagee", "mortgagor" and "financial hardship due to circumstances beyond the mortgagor's control", defined "foreclosure mediation program" and "periodic payments" and made technical changes throughout, effective July 1, 2008; P.A. 09-209 redefined "financial hardship due to circumstances beyond the mortgagor's control" in Subdiv. (7), effective July 1, 2009; P.A. 09-219 changed effective date of P.A. 09-209, S. 27, from July 1, 2009, to July 9, 2009, and applicable to applications for emergency mortgage assistance filed on and after July 1, 2008, effective July 9, 2009.

      Sec. 8-265dd. Emergency mortgage assistance payment program. Foreclosure of eligible mortgage. (a) Not later than January 1, 1994, the authority shall establish, within available funds, a program to provide emergency mortgage assistance payments to mortgagors in accordance with the provisions of sections 8-265cc to 8-265kk, inclusive. Any necessary and related administrative and operational expenses incurred by the authority in implementing the program may be paid from funds made available for the program.

      (b) Notwithstanding any provision of the general statutes, or any rule of law to the contrary, on and after July 1, 2008, no judgment of strict foreclosure nor any judgment ordering a foreclosure sale shall be entered in any action instituted by the mortgagee to foreclose a mortgage commenced on or after said date, for the foreclosure of an eligible mortgage unless (1) notice to the mortgagor has been given by the mortgagee in accordance with section 8-265ee and the time for response has expired, and (2) a determination has been made on the mortgagor's application for emergency mortgage assistance payments in accordance with section 8-265ff or the applicable time periods set forth in sections 8-265cc to 8-265kk, inclusive, have expired, whichever is earlier. For purposes of this section and sections 8-265ee to 8-265kk, inclusive, an "eligible mortgage" is a mortgage which satisfies the standards contained in subdivisions (1), (3), (8) and (10) to (13), inclusive, of subsection (e) of section 8-265ff.

      (P.A. 93-414, S. 2, 10; P.A. 94-185, S. 2, 10; P.A. 08-176, S. 6; P.A. 09-209, S. 28; 09-219, S. 1; P.A. 10-32, S. 21.)

      History: P.A. 93-414 effective July 1, 1993; P.A. 94-185 amended Subsec. (a) to authorize the payment of administrative and operative expenses from program funds and amended Subsec. (b) for consistency with changes made elsewhere in the act, effective June 2, 1994; P.A. 08-176 amended Subsec. (b) to substitute "July 1, 2008" for "the date a mortgagee agrees to participation in the program established pursuant to sections 8-265cc to 8-265kk, inclusive" and make technical changes, effective July 1, 2008; P.A. 09-209 made a technical change in Subsec. (b), effective July 1, 2009; P.A. 09-219 changed effective date of P.A. 09-209, S. 28, from July 1, 2009, to July 9, 2009, and applicable to applications for emergency mortgage assistance filed on and after July 1, 2008, effective July 9, 2009; P.A. 10-32 made a technical change in Subsec. (b), effective May 10, 2010.

      Sec. 8-265ee. Notice to mortgagee of foreclosure. Meeting or conference with mortgagee or consumer credit counseling agency. (a) On and after July 1, 2008, a mortgagee who desires to foreclose upon a mortgage which satisfies the standards contained in subdivisions (1), (3), (10), (11) and (12) of subsection (e) of section 8-265ff, shall give notice to the mortgagor by registered, or certified mail, postage prepaid at the address of the property which is secured by the mortgage. No such mortgagee may commence a foreclosure of a mortgage prior to mailing such notice. Such notice shall advise the mortgagor of his delinquency or other default under the mortgage and shall state that the mortgagor has sixty days from the date of such notice in which to (1) have a face-to-face meeting, telephone or other conference acceptable to the authority with the mortgagee or a face-to-face meeting with a consumer credit counseling agency to attempt to resolve the delinquency or default by restructuring the loan payment schedule or otherwise, and (2) contact the authority, at an address and phone number contained in the notice, to obtain information and apply for emergency mortgage assistance payments if the mortgagor and mortgagee are unable to resolve the delinquency or default.

      (b) Except in cases in which the mortgagee refuses to meet with the mortgagor, if the mortgagor fails to meet with the mortgagee or comply with any of the time limitations specified in the notice as provided in subsection (a) of this section, or if the mortgagor's application is not filed by the date thirty days after the date of any default in payment under an agreement as provided in subsection (c) of this section or if the mortgagor's application for emergency mortgage assistance payments is not approved by the date thirty calendar days after the date of receipt of the mortgagor's application in accordance with the provisions of section 8-265ff, the foreclosure of the mortgagor's mortgage may, at any time thereafter, except as provided in subsection (e) of this section, continue without any further restriction or requirement under the provisions of sections 8-265cc to 8-265kk, inclusive, provided the mortgagee files an affidavit with the court stating the notice provisions of subsection (a) of this section have been complied with and that either the mortgagor failed to meet with the mortgagee or failed to comply with all of the time limitations specified in the notice as provided in subsection (a) of this section or that the mortgagor's application for emergency assistance payments was not approved by the date thirty calendar days after the date of receipt of the mortgagor's application, or that a determination of ineligibility was made.

      (c) If, after a face-to-face meeting, telephone or other conference acceptable to the authority, as provided in subsection (a) of this section, the mortgagor and the mortgagee reach an agreement to resolve the delinquency or default and, because of financial hardship due to circumstances beyond the mortgagor's control, the mortgagor is unable to fulfill the obligations of the agreement, the mortgagor may apply to the authority for emergency mortgage assistance payments under sections 8-265cc to 8-265kk, inclusive, by the date thirty days after the date of any default in payment under the agreement. The mortgagee shall not be required to send any additional notice to the mortgagor other than the notice required under subsection (a) of this section.

      (d) No person receiving financial relief under sections 8-265cc to 8-265kk, inclusive, may file a defense, counterclaim or set-off to any action for foreclosure of the mortgage for which such financial relief was provided.

      (e) Nothing in sections 8-265cc to 8-265kk, inclusive, shall prevent a mortgagor from exercising rights that may exist under the foreclosure mediation program and those rights may be exercised concurrently with the rights afforded under sections 8-265cc to 8-265kk, inclusive, provided the exercise of rights under the foreclosure mediation program shall not cause a delay in the determination under subsection (e) of section 8-265ff. Nothing in sections 8-265cc to 8-265kk, inclusive, shall prevent a mortgagor from applying or reapplying and being considered for emergency mortgage assistance if such mortgagor is referred to the emergency mortgage assistance program by the foreclosure mediation program.

      (P.A. 93-414, S. 3, 10; P.A. 94-185, S. 3, 10; P.A. 08-176, S. 7; P.A. 09-209, S. 29; 09-219, S. 1.)

      History: P.A. 93-414 effective July 1, 1993; P.A. 94-185 amended Subsec. (a) to provide that the section is applicable after the mortgagee files a participation agreement and provide that notice of foreclosure may be by registered mail and amended Subsec. (b) to provide that the foreclosure may continue if the mortgagor fails to file an application within 30 days, failed to meet with the mortgagee or the application was not approved, effective June 2, 1994; P.A. 08-176 amended Subsec. (a) to substitute "July 1, 2008" for "the date a mortgagee files an agreement to participate in the program established pursuant to sections 8-265cc to 8-265kk, inclusive", to extend time limit for mortgagor to comply from 30 days to 60 days from date of notice, to add in Subdiv. (1) other conference acceptable to authority and to make technical changes, amended Subsec. (b) to make technical changes, amended Subsec. (c) to add other conference acceptable to authority and to make technical changes, and added Subsec. (e) re not preventing exercising of rights, effective July 1, 2008; P.A. 09-209 made a technical change in Subsec. (a), amended Subsec. (b) by adding exception for cases in which mortgagee refuses to meet with mortgagor and reference to Subsec. (e), and amended Subsec. (e) by making a technical change and adding provision re applying or reapplying for assistance if referred by foreclosure mediation program, effective July 1, 2009; P.A. 09-219 changed effective date of P.A. 09-209, S. 29, from July 1, 2009, to July 9, 2009, and applicable to applications for emergency mortgage assistance filed on and after July 1, 2008, effective July 9, 2009.

      Sec. 8-265ff. Application for loan. Disclosure of assets by mortgagor. Determination of eligibility by the authority. (a) Any mortgagor may apply for emergency mortgage assistance payments under sections 8-265cc to 8-265kk, inclusive, if such mortgagor (1) has received notice of intent to foreclose as provided in section 8-265ee, or (2) (A) is sixty days or more delinquent on a mortgage, or (B) such mortgagor anticipates that he will be sixty days or more delinquent on a mortgage based on financial hardship beyond such mortgagor's control, provided the authority determines that such mortgagor will be so delinquent. As part of the application process, the authority may refer the applicant to a counseling agency approved by the United States Department of Housing and Urban Development.

      (b) If the mortgagor applies for emergency mortgage assistance payments under sections 8-265cc to 8-265kk, inclusive, the authority shall, no later than eight business days after the date of receipt of such application, notify all of the mortgagees listed on the application holding a mortgage on the mortgagor's real property.

      (c) The mortgagor shall apply for a loan on the form provided by the authority. The mortgagor shall complete and sign the application subject to the penalty for false statement under section 53a-157b.

      (d) The mortgagor shall provide the authority with full disclosure of all assets and liabilities, whether singly or jointly held, and all household income regardless of source. For purposes of this subsection, both of the following are included as assets:

      (1) The sum of the household's savings and checking accounts, market value of stocks, bonds and other securities, other capital investments, pensions and retirement funds, personal property and equity in real property including the subject mortgage property. Income derived from family assets shall be considered as income. Equity is the difference between the market value of the property and the total outstanding principal of any loans secured by the property and other liens.

      (2) Lump-sum additions to family assets such as inheritances, capital gains, insurance payments included under health, accident, hazard or worker's compensation policies and settlements, verdicts or awards for personal or property losses or transfer of assets without consideration within one year of the time of application. Pending claims for such items must be identified by the homeowner as contingent assets.

      (e) The authority shall make a determination of eligibility for emergency mortgage assistance payments by the date thirty calendar days after the date of receipt of the mortgagor's application. During said thirty-day period no judgment of strict foreclosure or any judgment ordering foreclosure by sale shall be entered in any action for the foreclosure of any mortgage any mortgagee holds on the mortgagor's real property. No emergency mortgage assistance payments may be provided unless the authority finds that:

      (1) The real property securing the mortgage is a one-to-four family owner-occupied residence, including, but not limited to, a single family unit in a common interest community, is the principal residence of the mortgagor and is located in this state;

      (2) Payments, including amounts required to be paid into escrow or impound accounts as reserves for taxes and insurance payments, including mortgage insurance, or any combination of such payments, owed by the mortgagor under any mortgage on such real property have been contractually delinquent and the mortgagee has indicated to the mortgagor its intention to foreclose;

      (3) The mortgage is not insured by the Federal Housing Administration under Title II of the National Housing Act, 12 USC Section 1707 et seq.;

      (4) The mortgagor is a resident of this state and is suffering financial hardship which renders the mortgagor unable to correct the delinquency or delinquencies within a reasonable time and make full mortgage payments. For the purposes of subdivision (8) of this subsection, in order to determine whether the financial hardship is due to circumstances beyond the mortgagor's control, the authority may consider information regarding the mortgagor's employment, credit history and current and past household income, assets, total debt service, net worth, eligibility for other types of assistance and any other criteria or related factors it deems necessary and relevant;

      (5) There is a reasonable prospect that the mortgagor will be able to resume full mortgage payments on the original, modified or refinanced mortgage within sixty months after the beginning of the period in which emergency mortgage assistance payments are provided in accordance with a written plan formulated or approved by the authority and pay the mortgage in full in level monthly payments of principal and interest, subject only to payment changes as provided in the mortgage, by its maturity date;

      (6) The mortgagor has applied to the authority for emergency mortgage assistance payments on an application form prescribed by the authority which includes a financial statement disclosing all assets and liabilities of the mortgagor, whether singly or jointly held, and all household income regardless of source;

      (7) Based on the financial statement, the mortgagor has insufficient household income or net worth to correct the delinquency or delinquencies within a reasonable period of time and make full mortgage payments;

      (8) There is a reasonable prospect that the mortgagor, as determined by the authority, will be able to repay the emergency mortgage assistance within a reasonable amount of time under the terms of section 8-265hh, including through a refinancing of the mortgage, and the authority finds that, except for the current delinquency, the mortgagor has had a favorable residential mortgage credit history for the previous two years or period of ownership, whichever is less. For the purposes of this subdivision, if a mortgagor has been more than thirty days in arrears four or more times on a residential mortgage within the previous year, the mortgagor shall be ineligible for emergency mortgage assistance payments unless the mortgagor can demonstrate that the prior delinquency was the result of financial hardship due to circumstances beyond the mortgagor's control. In making a determination under this subsection, the authority may consider information regarding the structure of the mortgage, its repayment schedule and any other relevant factors or criteria it deems appropriate;

      (9) The mortgagee is not otherwise prevented by law from foreclosing upon the mortgage;

      (10) The mortgagor has not mortgaged the real property for commercial or business purposes;

      (11) The mortgagor has not previously received emergency mortgage assistance payments from the authority, provided a mortgagor who has previously received such payments shall be eligible to reapply if the mortgagor has reinstated the mortgage and the mortgagor shall not have been delinquent for at least six consecutive months immediately following such reinstatement;

      (12) The mortgagor is not in default under the mortgage except for the monetary delinquency referred to in subdivision (2) of this subsection; and

      (13) The mortgagor meets such other procedural requirements as the authority may establish.

      (P.A. 93-414, S. 4, 10; P.A. 94-185, S. 4, 10; P.A. 96-180, S. 12, 166; P.A. 08-176, S. 8; P.A. 09-209, S. 30; 09-219, S. 1.)

      History: P.A. 93-414 effective July 1, 1993; P.A. 94-185 made technical changes in Subsec. (d), effective June 2, 1994; P.A. 96-180 amended Subsec. (b) by replacing Sec. 53a-157 with Sec. 53a-157b, effective June 3, 1996; P.A. 08-176 substituted in Subsec. (d)(1) "one-to-four family" for "single or two-family" and in Subsec. (d)(5) 60 months for 36 months, in Subsec. (d)(8) added reference to payment "through a refinancing of the mortgage", changed period for a favorable credit history from 5 to 2 years and changed provision for arrears from 2 or more times within previous 2 years to 4 or more times within previous year, and made technical changes in Subsecs. (a) and (d), effective July 1, 2008; P.A. 09-209 added new Subsec. (a) re when mortgagor may apply for emergency mortgage assistance payments, redesignated existing Subsecs. (a) to (d) as Subsecs. (b) to (e), and amended redesignated Subsec. (e)(5) by adding "on the original, modified or refinanced mortgage"; P.A. 09-219 changed effective date of P.A. 09-209, S. 30, from October 1, 2009, to July 9, 2009, and applicable to applications for emergency mortgage assistance filed on and after July 1, 2008, effective July 9, 2009.

      Sec. 8-265gg. Monthly payments. Calculation of amount. Procedures for review of mortgagor's financial circumstances. Modification to amount of payment. (a) If the authority approves a mortgagor for assistance under the provisions of section 8-265ff, the authority shall make monthly emergency mortgage assistance payments directly to each mortgagee secured by the mortgagor's real property for a period not to exceed sixty months, either consecutively or nonconsecutively. The total monthly payment made by the authority, to or on behalf of a mortgagor under subsection (c) of this section, shall be not more than twenty-eight per cent of one hundred forty per cent of annual area median income, as published by the United States Department of Housing and Urban Development, divided by twelve. Upon receipt of payment in full from a mortgagor of the monthly amount established under subsection (b) of this section, the authority shall pay to each mortgagee the full amount then due to the mortgagee pursuant to the terms of the mortgage without regard to any acceleration under the mortgage. Such payments shall include, but not be limited to, principal, interest, taxes, assessments and insurance premiums. The initial payment made by the authority to each mortgagee may be an amount which pays all arrearages and pays reasonable costs and reasonable attorney's fees incurred by the mortgagee in connection with foreclosure of the mortgage.

      (b) A mortgagor on whose behalf the authority is making emergency mortgage assistance payments shall, during the period in which such assistance is provided, make monthly payments to the authority in lieu of the mortgagor's monthly mortgage payments. Such payments to the authority shall be in an amount which will cause the mortgagor's total housing expense to be less than or equal to thirty-five per cent of the mortgagor's aggregate family income. The mortgagor shall make such payments to the authority not later than seven days before each mortgage payment is due to the mortgagee.

      (c) The amount by which the emergency mortgage assistance payments made by the authority to the mortgagee exceeds the payments made by the mortgagor to the authority shall be a loan in that amount made by the authority to the mortgagor. Any such loan shall be evidenced by such documents as the authority may require and shall be subject to repayment with interest and secured as provided in section 8-265hh.

      (d) The authority shall establish procedures for periodic review of the mortgagor's financial circumstances for the purpose of determining the necessity for continuation, termination or adjustment of the amount of emergency mortgage assistance payments or adjustment of the payments by the mortgagor pursuant to subsection (b) of this section. Payments shall be discontinued when the authority determines that, due to changes in the mortgagor's financial condition, the payments are no longer necessary in accordance with the standards contained in section 8-265ff or the expiration of the sixty-month period of a mortgagor eligibility for such payments under subsection (e) of section 8-265ff, whichever is sooner, and a foreclosure of the mortgagor's mortgage may, at any time thereafter, proceed without further restriction or requirement under sections 8-265cc to 8-265hh, inclusive. The authority may adjust payments by the mortgagor pursuant to subsection (b) of this section based on a review under this subsection.

      (e) If the mortgagor fails to pay to the authority any amounts due under subsection (b) of this section within seven days of the date due to the authority, the authority shall review the mortgagor's financial circumstances to determine whether the delinquency is the result of additional financial hardship due to circumstances beyond the mortgagor's control. If the delinquency is not the result of additional financial hardship due to circumstances beyond the mortgagor's control in the mortgagor's financial circumstances, the authority shall terminate emergency mortgage assistance payments and the foreclosure of the mortgagor's mortgage may, at anytime thereafter, continue without any further restriction or requirement under sections 8-265cc to 8-265kk, inclusive. If the delinquency is the result of a change in the mortgagor's financial circumstances, the authority may modify the mortgagor's required monthly payments to the authority.

      (f) If any mortgagee scheduled to receive payments from the authority under the provisions of sections 8-265cc to 8-265kk, inclusive, fails to receive the full amount of such payment from the authority within thirty days of the scheduled due date, or if the mortgagor fails to observe and perform all of the terms, covenants and conditions of the mortgage, the mortgagee shall provide a fifteen-day notice to the authority and the foreclosure of the mortgagor's mortgage may, at any time thereafter, proceed without any further restriction or requirement under sections 8-265cc to 8-265kk, inclusive.

      (P.A. 93-414, S. 5, 10; P.A. 94-185, S. 5, 10; P.A. 08-176, S. 9; P.A. 09-209, S. 32; 09-219, S. 1.)

      History: P.A. 93-414 effective July 1, 1993; P.A. 94-185 made technical changes, effective June 2, 1994; P.A. 08-176 amended Subsec. (a) to change time limit for assistance payments from 36 to 60 months and change provision re initial payment to allow, rather than require, authority to pay an amount which pays all arrearages and reasonable costs and attorney's fees, and amended Subsec. (d) to change reference to mortgage eligibility period from 36 months to 60 months and to make a technical change, effective July 1, 2008; P.A. 09-209 made a technical change in Subsec. (d); P.A. 09-219 changed effective date of P.A. 09-209, S. 32, from October 1, 2009, to July 9, 2009, and applicable to applications for emergency mortgage assistance filed on and after July 1, 2008, effective July 9, 2009.

      Sec. 8-265hh. Repayment agreement. (a) Upon approval of emergency mortgage assistance payments, the authority shall enter into an agreement with the mortgagor for repayment of all such assistance with interest as provided in this section. The agreement shall provide for monthly payments by the mortgagor after emergency mortgage assistance payments have ended and shall be subject to the following provisions:

      (1) If the mortgagor's total housing expense, including projected repayments for mortgage assistance under this section, is greater than thirty-five per cent of the mortgagor's aggregate family income, repayment of the emergency mortgage assistance payments shall be deferred until such total housing expense, including projected repayments for mortgage assistance under this section, is less than or equal to thirty-five per cent of such aggregate family income;

      (2) If repayment of emergency mortgage assistance payments is not made by the date the mortgage is paid in full, the mortgagor shall make monthly payments to the authority in an amount not less than the monthly mortgage payment until such assistance is repaid;

      (3) Interest shall accrue on all emergency mortgage assistance payments made by the authority at a rate based upon the cost of funds to the state periodically determined by the State Treasurer in consultation with the authority. Interest shall start to accrue whenever the mortgagor is required to commence repayment under this section.

      (b) Repayment of amounts owed to the authority from a mortgagor under the provisions of sections 8-265cc to 8-265kk, inclusive, shall be secured by a mortgage on the mortgagor's real property, provided said mortgage shall not be deemed to take priority over any other mortgage or lien in effect against such property on the date the emergency mortgage is recorded. The authority may allow subordination of its mortgage if such subordination is required to permit the mortgagor to obtain a home improvement loan for repairs necessary to preserve the property.

      (c) The authority shall establish written procedures for periodic review of the mortgagor's financial circumstances to determine the amounts of repayment required under this section.

      (d) All moneys received by the authority from mortgagors for repayment of emergency mortgage assistance payments shall be paid to the authority, deposited in such funds or accounts as the authority may establish from time to time for such purpose and be used solely for the purposes of the program established pursuant to sections 8-265cc to 8-265kk, inclusive.

      (e) Any mortgagor who misrepresents any financial or other pertinent information in conjunction with the filing of an application for emergency mortgage assistance or modification of such assistance, may be denied assistance and required to immediately repay any amount of assistance already made. The mortgagee may, at any time thereafter, take any legal action to enforce the mortgage without further restrictions or requirements.

      (f) The authority may take any action it deems appropriate to recover emergency mortgage assistance when the mortgagor fails to repay such assistance under the terms and conditions established under this section.

      (P.A. 93-414, S. 6, 10; P.A. 94-185, S. 6, 10; P.A. 99-241, S. 6, 66; P.A. 08-176, S. 10; P.A. 09-209, S. 33; 09-219, S. 1.)

      History: P.A. 93-414 effective July 1, 1993; P.A. 94-185 made technical changes, effective June 2, 1994; P.A. 99-241 amended Subsec. (d) to provide that repayments received by the authority be deposited in the General Fund, effective July 1, 1999; P.A. 08-176 amended Subsec. (d) to replace requirement that moneys received be paid to State Treasurer and deposited in General Fund with requirement that moneys be used solely for purposes of program established pursuant to Secs. 8-265cc to 8-265kk, effective July 1, 2008; P.A. 09-209 amended Subsec. (a) by deleting former Subdiv. (1), redesignating existing Subdivs. (2) to (4) as Subdivs. (1) to (3) and adding "including projected repayments for mortgage assistance under this section" in redesignated Subdiv. (1); P.A. 09-219 changed effective date of P.A. 09-209, S. 33, from October 1, 2009, to July 9, 2009, and applicable to applications for emergency mortgage assistance filed on and after July 1, 2008, effective July 9, 2009.

      Sec. 8-265ii. Written procedures. The Connecticut Housing Finance Authority shall adopt procedures in accordance with section 1-121 to implement the provisions of sections 8-265cc to 8-265hh, inclusive. Such procedures shall include the establishment of a process for notification to eligible mortgagors of the availability of funds under sections 8-265cc to 8-265kk, inclusive, and for notification to the mortgagee that an application has been received by or on behalf of the mortgagor and of the authority's determination of eligibility.

      (P.A. 93-414, S. 7, 10; P.A. 94-185, S. 7, 10.)

      History: P.A. 93-414 effective July 1, 1993; P.A. 94-185 made technical changes, effective June 2, 1994.

      Sec. 8-265jj. Filing of notice of agreement to participate in program with the authority. Section 8-265jj is repealed, effective July 1, 2008.

      (P.A. 94-185, S. 8, 10; P.A. 08-176, S. 84.)

      Sec. 8-265kk. Notification by authority to participating mortgagees of unavailability of funds. If funds are not available to provide emergency mortgage assistance payments to mortgagors in accordance with sections 8-265cc to 8-265kk, inclusive, the authority shall notify all mortgagees and shall not accept applications for emergency mortgage assistance payment. Upon receipt of such notice from the authority and until mortgagees receive a further notice from the authority that such funds are again available and applications for emergency mortgage assistance payments are again being accepted by the authority: (1) Mortgagees may commence foreclosure actions without first providing the notice set forth in subsection (a) of section 8-265ee; and (2) the foreclosure of mortgages by mortgagees may continue without any further restriction or requirement under the provisions of sections 8-265cc to 8-265kk, inclusive.

      (P.A. 94-185, S. 9, 10.)

      History: P.A. 94-185 effective June 2, 1994.

      Sec. 8-265ll. Pilot program of revolving loans to developers for rehabilitation of existing housing. (a) The Connecticut Housing Finance Authority, in conjunction with existing private lending programs and qualified lenders, shall develop a pilot program of revolving rehabilitation loans to developers, including nonprofit housing corporations, for the acquisition and rehabilitation of housing consisting of one to four dwelling units. Properties rehabilitated with loans made under this section shall be sold only to persons meeting eligibility requirements for financial assistance under programs operated by the authority. In making loans under this section, the authority may give priority to developers participating in local, state or federal programs financing the rehabilitation of housing.

      (b) The authority shall adopt written procedures in accordance with section 1-121 establishing procedures for the application and distribution of loans under this section.

      (P.A. 96-147, S. 1, 3.)

      History: P.A. 96-147 effective July 1, 1996.

      Sec. 8-265mm. Pilot program of home purchasing assistance for police officers. (a) For purposes of this section:

      (1) "Applicant" means a local or state police officer who applies for a loan under the home purchasing assistance program, established pursuant to subsection (b) of this section, for the purpose of financing the purchase of real estate.

      (2) "Authority" means the Connecticut Housing Finance Authority.

      (3) "Municipality" means a town, city or borough with a population of not less than forty-five thousand which, by resolution of its legislative body, elects to participate in the program established in accordance with subsection (b) of this section.

      (4) "Real estate" means a one, two or three-family residence located in a participating municipality.

      (5) "Targeted neighborhood" means an area designated by the legislative body of the municipality as an area where there has been a high incidence of crime or where the legislative body of the municipality determines that increased police presence is needed, where police officers participating in the home purchasing assistance program established pursuant to subsection (b) of this section shall reside.

      (b) The Connecticut Housing Finance Authority shall develop and, in cooperation with participating municipalities, administer a pilot program of home purchasing assistance. The purpose of the program shall be to encourage local and state police officers to purchase and live in residential property in targeted neighborhoods located in the municipality by which they are employed to reduce crime by promoting community policing. The authority shall implement the pilot program in an amount not to exceed ten million dollars and in a manner designed to facilitate the purchase of real estate targeted neighborhoods in participating municipalities by providing low-interest loans to local and state police officers in accordance with the provisions of this section. The pilot program shall commence on January 1, 1997, and terminate on December 31, 1999.

      (c) To be eligible for assistance under subsection (e) or (f) of this section, an applicant shall: (1) Be a local police officer employed by a municipal police department on a full-time or part-time basis or a state police officer; (2) certify intent to use the funds in connection with the purchase of real estate located in the municipality by which such applicant is employed as provided by this section; (3) certify intent to own and reside in such real estate on a permanent and full-time basis for at least seven years; (4) take title in such applicant's name and be the grantee or borrower, as the case may be under this section, and (5) in the case of a loan, agree to make monthly loan payments for a period not to exceed thirty years, in the manner prescribed by the authority pursuant to procedures adopted by the authority in accordance with subsection (i) of this section.

      (d) A municipality may participate in the pilot program by (1) enrolling in the program established under this section in accordance with written procedures of the authority, (2) advising each applicant of the availability of down payment assistance under section 8-286 and low-interest loans through the authority and (3) designating one or more targeted neighborhoods in the municipality.

      (e) (1) A municipality may make grants to applicants to pay for reasonable and bona fide closing costs, as described in subsection (i) of section 36a-563. The authority may provide a preference for loans under this section to applicants for loans for real estate located in a municipality in which grants are offered under this subsection.

      (2) If a grantee ceases to be a local or state police officer prior to the end of the seventh year after the date on which such grant is made, or ceases to live in the residential property purchased with assistance provided under this section, the grantee shall reimburse the municipality for the amount of the grant within thirty days of receipt of written notice from the municipality that such reimbursement is due.

      (f) Any applicant for a loan under this section shall be eligible for a loan for down payment assistance under section 8-286, except that the provisions of regulations adopted under section 8-289 concerning household income and equity contributions shall not apply to an applicant as defined in subsection (a) of this section.

      (g) The authority shall issue mortgage revenue bonds pursuant to 26 USC Section 143 to provide sufficient funds for loans under this section. The interest rate on such loans shall be the lowest practicable which would create an incentive for applicants. Such loans shall satisfy the requirements of 26 USC Section 143, including, but not limited to, requirements for residence, sales, income and three-year requirements, as applicable, and the requirements of the Connecticut Housing Finance Home Mortgage Loan Program.

      (h) The authority shall submit a report on the program to the General Assembly on or before October 1, 1997, and annually thereafter. Such report shall include programmatic data and may include recommendations for modifications to the program.

      (i) The authority shall adopt written procedures in accordance with section 1-121 establishing procedures for the application and distribution of loans pursuant to subsection (f) of this section and the conditions for such loans.

      (P.A. 96-147, S. 2, 3.)

      History: P.A. 96-147 effective July 1, 1996.

      Sec. 8-265nn. Pilot program for rehabilitation or refinancing of buildings with five to twenty-five dwelling units. (a) The Connecticut Housing Finance Authority shall develop, in conjunction with private lenders and the Federal National Mortgage Association, a two-year pilot program to guarantee loans by approved lenders for the rehabilitation or refinancing of buildings with five to twenty-five dwelling units. The authority may fix a fee for the payment of any administrative cost incurred under the provisions of this section. Such fee may be computed as a percentage of the principal of the mortgage outstanding at the beginning of each mortgage year, but shall not be more than one-quarter of one per cent per year of such principal amount. The amount of such fee need not be uniform for all insured loans. Such fee shall be payable by mortgagors or mortgagees in such manner as prescribed by the authority. Such guarantees shall insure the lender against loss not to exceed twenty per cent of the principal due at the time of default.

      (b) The authority shall adopt written procedures in accordance with the provisions of section 1-121 for the application and distribution of loans under this section.

      (P.A. 97-307, S. 1, 4.)

      History: P.A. 97-307 effective July 1, 1997.

      Sec. 8-265oo. Residential mortgage loan refinancing guarantee program. (a) As used in this section:

      (1) "Authority" means the Connecticut Housing Finance Authority as created under section 8-244;

      (2) "Mortgage" means a mortgage deed or other instrument that constitutes a first consensual lien on one, two or three-family owner-occupied residential real property located in this state;

      (3) "Mortgagee" means mortgage lenders authorized to originate mortgage loans in this state; and

      (4) "Mortgagor" means the owner-occupant of one, two or three-family residential real property located in this state who is also the borrower under a mortgage encumbering such real property.

      (b) It being in the public interest for the state to extend mortgage guarantees to mortgage lending institutions to provide refinancing for mortgage loans when the decline of home values has precluded such lending, the Connecticut Housing Finance Authority shall establish and administer a program of loan guarantees to work in conjunction with loan programs established by secondary market investors to allow mortgagees to refinance residential mortgage loans when a decrease in the appraised value of the real property securing the mortgage might otherwise preclude such lending. The authority shall adopt procedures in accordance with the provisions of section 1-121 no later than January 1, 2000, to carry out the provisions of this section. Such procedures may establish a fee for such mortgage guarantee.

      (c) The authority shall implement the program established by this section within the resources allocated by the State Bond Commission to the Department of Economic and Community Development for the purposes of a grant to the authority for the purposes of this section, in a manner designed to facilitate the qualifications of mortgage guarantees under such program for sale to one or more secondary mortgage markets for such loans. The authority shall explore options that maximize the funds made available, including, but not limited to, the opportunity to minimize the state's exposure through insurance alternatives.

      (d) (1) The authority is authorized to enter into loan guarantee agreements with secondary market investors or lenders who meet criteria established by the authority in procedures adopted pursuant to subsection (b) of this section. The authority shall make available to the general public a description of the residential mortgage refinancing guarantee program, including, but not limited to, information regarding participation of mortgagees in the program, eligibility criteria and the terms and conditions of the mortgage guarantee.

      (2) Mortgagees may participate in the program by entering into a mortgage guarantee agreement with the authority. Mortgagees participating in the program shall process and underwrite mortgage guarantees in accordance with the provisions of this section and with the procedures adopted pursuant to subsection (b) of this section.

      (e) Mortgagors eligible for refinanced mortgages under this program shall meet the criteria established in the procedures adopted pursuant to subsection (b) of this section, including, but not limited to:

      (1) The mortgagor shall occupy the property as such mortgagor's primary residence, and shall continue such occupancy for five years after the date of the refinancing under this section;

      (2) The mortgagor shall have received the primary mortgage on the property no earlier than January 1, 1986, and no later than December 31, 1992;

      (3) The mortgagor shall have a primary mortgage on the property with a loan to value ratio of no more than one hundred twenty-five per cent, and a recent full appraisal of the property in accordance with secondary market standards shall be required;

      (4) The mortgagor shall have no second mortgage on the property except a second mortgage where repayment is waived after a certain period of time has elapsed; and

      (5) No mortgagor shall participate in this program if such mortgagor currently has other refinancing alternatives.

      (f) Any mortgagee or mortgagor seeking a mortgage guarantee shall provide such information to the authority as the authority deems reasonably necessary.

      (g) Mortgages refinanced pursuant to this section shall be underwritten using secondary market standards, except:

      (1) The household income of the mortgagor shall not exceed one hundred twenty per cent of the state median income;

      (2) The mortgagor shall have been current on the payments on the mortgage loan for the most recent twenty-four-month period; and

      (3) The credit rating of the mortgagor shall meet the secondary market standards.

      (h) The amount of any mortgage guarantee provided under this section shall be reviewed and approved by the authority. The guarantee shall secure the mortgagee up to the amount of the guarantee for any loss incurred by the mortgagee because of default by the mortgagor including losses in principal balance.

      (i) The authority may terminate any mortgage guarantee if the mortgagee misrepresents any information pertaining to the application for a mortgage guarantee or fails to comply with any term of the mortgage guarantee agreement in connection with the mortgage guarantee.

      (P.A. 99-262, S. 1, 3; P.A. 00-183.)

      History: P.A. 99-262 effective July 1, 1999; P.A. 00-183 amended Subsec. (e) to delete former Subdiv. (5) requiring that a mortgagor carry mortgage insurance on property in a second mortgage and renumber Subdiv. (6) as Subdiv. (5).

      Sec. 8-265pp. Mortgage assistance program for certain teachers. The Connecticut Housing Finance Authority shall develop and administer a program of mortgage assistance to certified teachers (1) employed by priority school districts pursuant to section 10-266p, (2) employed by transitional school districts pursuant to section 10-263c, (3) employed by regional vocational-technical schools located in such priority or transitional school districts, or (4) who teach in a subject matter shortage area pursuant to section 10-8b. Such assistance shall be available to eligible teachers for the purchase of a house as their principal residence, provided, in the case of a teacher employed by a priority or a transitional school district, or by a regional vocational-technical school located in a priority or transitional school district, the house is located in such district. In making mortgage assistance available under the program, the authority shall utilize down payment assistance or any other appropriate housing subsidies. The terms of any mortgage assistance shall allow the mortgagee to realize a reasonable portion of the equity gain upon sale of the mortgaged property.

      (P.A. 00-187, S. 26, 75; P.A. 01-173, S. 57, 67; P.A. 03-278, S. 23.)

      History: P.A. 00-187 effective July 1, 2000; P.A. 01-173 renumbered Subdiv. (3) as Subdiv. (4) and added new Subdiv. (3) re teachers employed by regional vocational-technical schools located in priority or transitional school districts, required the house being purchased to be located in such district and defined "minorities", effective July 1, 2001; P.A. 03-278 made a technical change, effective July 9, 2003.

      Sec. 8-265qq. Assessment increase deferred for rehabilitated properties. (a) The legislative body of any municipality or part thereof designated as a participating municipality by the Connecticut Housing Finance Authority, for purposes of the Urban Rehabilitation Homeownership Program, may, by ordinance, authorize such municipality to enter into a written agreement with any owner of any real property located in such municipality or eligible part thereof who agrees to rehabilitate such real property with assistance provided by the Connecticut Housing Finance Authority under said program. Such agreement shall provide that any increase in assessment attributable to such rehabilitation shall be deferred for a period of five years from the date such rehabilitation is completed.

      (b) Any such assessment increase deferral agreement shall provide for (1) the completion of such rehabilitation by a date fixed, (2) the inspection and certification by the local building official that the completed rehabilitation is in conformance with such provisions of the state building and health codes and the local housing code as may apply, and (3) the continued residence of the applicant in such property during the period of said deferral. Said agreement shall further provide that, in the event of a general revaluation by the municipality in the year in which such rehabilitation is completed resulting in any increase in the assessment of such property, only that portion of the increase resulting from such rehabilitation shall be deferred; and in the event of a general revaluation in any year after the year in which such rehabilitation is completed, such deferred assessment shall be increased or decreased in proportion to the increase or decrease in the total assessment on such property as a result of such general revaluation.

      (June Sp. Sess. P.A. 01-9, S. 81, 131.)

      History: June Sp. Sess. P.A. 01-9 effective July 1, 2001.

      Sec. 8-265rr. Mortgage refinancing program for homeowners with adjustable rate mortgages. (a) As used in this section, "authority" means the Connecticut Housing Finance Authority created under section 8-244.

      (b) The authority is authorized to continue to develop and implement a program for home mortgage refinancing for homeowners with fixed or adjustable rate mortgages as an additional purpose pursuant to the provisions of subdivision (32) of section 8-250. Such program shall (1) include making mortgage loans to borrowers who (A) are deemed eligible by the authority, and (B) purchase foreclosed or abandoned properties or properties conveyed by deed in lieu of foreclosure or short sale; or (2) be undertaken by the authority consistent with and subject to its contractual obligations to its bondholders in an initial amount of forty million dollars under terms and conditions determined by the authority.

      (P.A. 08-176, S. 1; P.A. 09-209, S. 31; June Sp. Sess. P.A. 10-2, S. 7.)

      History: P.A. 08-176 effective June 12, 2008; P.A. 09-209 amended Subsec. (b) by changing "adjustable rate mortgages" to "fixed or adjustable rate mortgages", effective July 9, 2009; June Sp. Sess. P.A. 10-2 amended Subsec. (b) by adding Subdiv. (1) specifying that program shall include making mortgage loans to borrowers who are deemed eligible by authority and purchase certain qualified properties and by inserting Subdiv. (2) designator, effective July 1, 2010.

      Sec. 8-265ss. Homeowner's Equity Recovery Opportunity loan program. (a) As used in this section:

      (1) "Authority" means the Connecticut Housing Finance Authority created under section 8-244;

      (2) "Mortgage" means a mortgage deed or other instrument which constitutes a first or second consensual lien on one-to-four family owner-occupied residential real property located in this state, including, but not limited to, a single-family unit in a common interest community, securing a loan made primarily for personal, family or household purposes;

      (3) "Borrower" means the owner-occupant of a one-to-four family residential real property located in this state, including, but not limited to, a single-family unit in a common interest community, who has a mortgage encumbering such real property;

      (4) "Lender" means the original lender under a mortgage, or its agents, successors or assigns; and

      (5) "HERO program" means the Homeowner's Equity Recovery Opportunity loan program.

      (b) The authority is authorized to develop and implement the HERO program as an additional purpose pursuant to the provisions of subdivision (32) of section 8-250. The HERO program shall be undertaken by the authority consistent with and subject to its contractual obligations with its bondholders in an initial amount of thirty million dollars.

      (c) On and after July 1, 2008, the authority shall implement the HERO program in accordance with this section. Said program shall offer, within available funds, financing through the following mechanism: The authority shall purchase mortgages directly from lenders and then place borrowers it determines to be eligible on an affordable repayment plan or make mortgage loans to borrowers who it determines to be eligible and who purchase foreclosed or abandoned properties or properties conveyed by deed in lieu of foreclosure or short sale. All borrowers approved by the authority for the program shall attend in-person financial counseling at an authority-approved agency.

      (d) A HERO loan shall: (1) Be a mortgage for up to thirty years in an amount determined by the authority; (2) provide an interest rate at an amount determined by the authority; (3) be serviced by the authority or its agents; and (4) have property taxes and insurance, including mortgage insurance, homeowner's insurance and, if applicable, flood insurance, included in the borrower's monthly payment amount.

      (e) For purposes of the HERO program, the authority shall purchase mortgages directly from lenders and make a HERO loan available to borrowers whose mortgages have been purchased by the authority and who have been determined by the authority to be eligible. A borrower shall be eligible if the HERO loan is in the first lien position, and if, in the authority's determination, the borrower has: (1) Made an effort to meet his or her financial obligations to the best of the borrower's ability; (2) sufficient and stable income to support timely repayment of a HERO loan; (3) legal title to the mortgaged property and resides in it as the borrower's permanent residence; and (4) if the borrower has stopped making monthly payments, the ability to account for the borrower's cash flow by showing how those funds were escrowed, saved or redirected. The authority shall make a determination of eligibility for the HERO program no later than thirty calendar days after the date of receipt of the borrower's application.

      (f) The borrower shall apply for a HERO loan on the form provided by the authority. The borrower shall complete and sign the application subject to the penalty for false statement under section 53a-157b. Any borrower who misrepresents any financial or other pertinent information in conjunction with the filing of an application for a HERO loan may be denied assistance. The borrower shall provide the authority with full disclosure of all assets and liabilities, whether singly or jointly held, and all household income regardless of source. For purposes of this subsection, both of the following are included as assets:

      (1) The sum of the household's savings and checking accounts, market value of stocks, bonds and other securities, other capital investments, pensions and retirement funds, personal property and equity in real property including the subject mortgage property. Income derived from family assets shall be considered as income. Equity is the difference between the market value of the property and the total outstanding principal of any loans secured by the property and other liens.

      (2) Lump-sum additions to family assets such as inheritances, capital gains, insurance payments included under health, accident, hazard or worker's compensation policies and settlements, verdicts or awards for personal or property losses or transfer of assets without consideration within one year of the time of application. Pending claims for such items must be identified by the borrower as contingent assets.

      (g) On or before July 1, 2008, the authority shall adopt procedures in accordance with section 1-121 to implement the provisions of this section.

      (P.A. 08-176, S. 2; June Sp. Sess. P.A. 10-2, S. 8.)

      History: P.A. 08-176 effective June 12, 2008; June Sp. Sess. P.A. 10-2 amended Subsec. (c) by authorizing authority to make mortgage loans to eligible borrowers who purchase certain eligible properties, effective July 1, 2010.