SB3667 98TH GENERAL ASSEMBLY

LRB098 21596 KTG 60457 b

98TH GENERAL ASSEMBLY
State of Illinois
2013 and 2014
SB3667

Introduced 5/30/2014, by Sen. Iris Y. Martinez

SYNOPSIS AS INTRODUCED:

310 ILCS 105/7
310 ILCS 105/10
310 ILCS 105/25

Amends the Rental Housing Support Program Act. In a provision concerning the Rental Housing Support Program, provides that the Illinois Housing Development Authority shall distribute amounts for the Program solely from annual receipts on deposit in the Rental Housing Support Program Fund that are appropriated in each year for distribution by the Authority for the Program, and not from any other source of funds for the Authority (rather than the Authority shall distribute amounts appropriated for the Program from the Rental Housing Support Program Fund and any other appropriations provided for the Program). Defines "annual receipts" to mean revenue derived from the Rental Housing Support Program State surcharge from July 1 to June 30. Provides that the Authority shall perform annual reconciliations of all distributions made in connection with the Program and may offset future distributions to balance geographic distribution requirements. Effective immediately.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning housing.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Rental Housing Support Program Act is amended by changing Sections 7, 10, and 25 as follows:

(310 ILCS 105/7)

Sec. 7. Definitions. In this Act:

"Annual receipts" means revenue derived from the Rental Housing Support Program State surcharge from July 1 to June 30.

"Authority" means the Illinois Housing Development Authority.

"Developer" means any entity that receives a grant under Section 20.

"Program" means the Rental Housing Support Program.

"Real estate-related document" means any recorded document that affects an interest in real property excluding documents which solely affect or relate to an easement for water, sewer, electricity, gas, telephone or other public service.

"Unit" means a rental apartment unit receiving a subsidy by means of a grant under this Act. "Unit" does not include housing units intended as transitional or temporary housing.

(Source: P.A. 94-118, eff. 7-5-05.)

(310 ILCS 105/10)

Sec. 10. Creation of Program and distribution of funds.

(a) The Rental Housing Support Program is created within the Illinois Housing Development Authority. The Authority shall administer the Program program and adopt rules for its implementation.

(b) The Authority shall distribute amounts for the Program solely from annual receipts on deposit in the Rental Housing Support Program Fund that are appropriated in each year for distribution by the Authority for the Program, and not from any other source of funds for the Authority, The Authority shall distribute amounts appropriated for the Program from the Rental Housing Support Program Fund and any other appropriations provided for the Program as follows:

(1) A proportionate share of annual receipts the annual appropriation, as determined under subsection (d) of Section 15 of this Act, shall be distributed to municipalities with a population greater than 2,000,000. Those municipalities shall use at least 10% of those funds in accordance with Section 20 of this Act, and all provisions governing the Authority's actions under Section 20 shall govern the actions of the corporate authorities of a municipality under this Section. As to the balance of the annual distribution, the municipality shall designate a non-profit organization that meets the specific criteria set forth in Section 25 of this Act to serve as the "local administering agency" under Section 15 of this Act.

(2) Of the remaining annual receipts appropriation after the distribution in paragraph (1) of this subsection, the Authority shall designate at least 10% for the purposes of Section 20 of this Act in areas of the State not covered under paragraph (1) of this subsection.

(3) The remaining annual receipts appropriation after the distributions in paragraphs (1) and (2) of this subsection shall be distributed according to Section 15 of this Act in areas of the State not covered under paragraph (1) of this subsection.

(Source: P.A. 94-118, eff. 7-5-05.)

(310 ILCS 105/25)

Sec. 25. Criteria for awarding grants. The Authority shall adopt rules to govern the awarding of grants and the continuing eligibility for grants under Sections 15 and 20. Requests for proposals under Section 20 must specify that proposals must satisfy these rules. The rules must contain and be consistent with, but need not be limited to, the following criteria:

(1) Eligibility for tenancy in the units supported by grants to local administering agencies must be limited to households with gross income at or below 30% of the median family income for the area in which the grant will be made. Fifty percent of the units that are supported by any grant must be set aside for households whose income is at or below 15% of the area median family income for the area in which the grant will be made, provided that local administering agencies may negotiate flexibility in this set-aside with the Authority if they demonstrate that they have been unable to locate sufficient tenants in this lower income range. Income eligibility for units supported by grants to local administering agencies must be verified annually by landlords and submitted to local administering agencies. Tenants must have sufficient income to be able to afford the tenant's share of the rent. For grants awarded under Section 20, eligibility for tenancy in units supported by grants must be limited to households with a gross income at or below 30% of area median family income for the area in which the grant will be made. Fifty percent of the units that are supported by any grant must be set aside for households whose income is at or below 15% of the median family income for the area in which the grant will be made, provided that developers may negotiate flexibility in this set-aside with the Authority or municipality as defined in subsection (b) of Section 10 if it demonstrates that it has been unable to locate sufficient tenants in this lower income range. The Authority shall determine what sources qualify as a tenant's income.

(2) Local administering agencies must include 2-bedroom, 3-bedroom, and 4-bedroom units among those intended to be supported by grants under the Program program. In grants under Section 15, the precise number of these units among all the units intended to be supported by a grant must be based on need in the community for larger units and other factors that the Authority specifies in rules. The local administering agency must specify the basis for the numbers of these units that are proposed for support under a grant. Local administering agencies must make a good faith effort to comply with this allocation of unit sizes. In grants awarded under Section 20, developers and the Authority or municipality, as defined in subsection (b) of Section 10, shall negotiate the numbers and sizes of units to be built in a project and supported by the grant.

(3) Under grants awarded under Section 15, local administering agencies must enter into a payment contract with the landlord that defines the method of payment and must pay subsidies to landlords on a quarterly basis and in advance of the quarter paid for.

(4) Local administering agencies and developers must specify how vacancies in units supported by a grant must be advertised and they must include provisions for outreach to local homeless shelters, organizations that work with people with disabilities, and others interested in affordable housing.

(5) The local administering agency or developer must establish a schedule for the tenant's rental obligation for units supported by a grant. The tenant's share of the rent must be a flat amount, calculated annually, based on the size of the unit and the household's income category. In establishing the schedule for the tenant's rental obligation, the local administering agency or developer must use 30% of gross income within an income range as a guide, and it may charge an additional or lesser amount.

(6) The amount of the subsidy provided under a grant for a unit must be the difference between the amount of the tenant's obligation and the total amount of rent for the unit. The total amount of rent for the unit must be negotiated between the local administering authority and the landlord under Section 15, or between the Authority or municipality, as defined in subsection (b) of Section 10, and the developer under Section 20, using comparable rents for units of comparable size and condition in the surrounding community as a guideline.

(7) Local administering agencies and developers, pursuant to criteria the Authority develops in rules, must ensure that there are procedures in place to maintain the safety and habitability of units supported under grants. Local administering agencies must inspect units before supporting them under a grant awarded under Section 15.

(8) Local administering agencies must provide or ensure that tenants are provided with a "bill of rights" with their lease setting forth local landlord-tenant laws and procedures and contact information for the local administering agency.

(9) A local administering agency must create a plan detailing a process for helping to provide information, when necessary, on how to access education, training, and other supportive services to tenants living in units supported under the grant. The plan must be submitted as a part of the administering agency's proposal to the Authority required under Section 15.

(10) Local administering agencies and developers may not use funding under the grant to develop or support housing that requires that a tenant has a particular diagnosis or type of disability as a condition of eligibility for occupancy unless the requirement is mandated by another funding source for the housing. Local administering agencies and developers may use grant funding to develop integrated housing opportunities for persons with disabilities, but not housing restricted to a specific disability type.

(11) In order to plan for periodic fluctuations in annual receipts program revenue, the Authority shall establish by rule a mechanism for establishing a reserve fund and the level of funding that shall be held in reserve either by the Authority or by local administering agencies.

(12) The Authority shall perform annual reconciliations of all distributions made in connection with the Program and may offset future distributions to balance geographic distribution requirements of this Act.

(Source: P.A. 97-892, eff. 8-3-12.)

Section 99. Effective date. This Act takes effect upon becoming law.