There are various types of affordable housing properties that are financed or rents that are subsidized by federal, state and local programs. These programs provide favorable financing for developments that provide affordable housing units and affordable rent restrictions placed on the property for a mandated time period. Besides the financing programs, there are rental assistance programs (contracts) placed on properties. The rental assistance contracts are a payment by the federal, state or local government towards the renter’s monthly rent and utility costs.
Owners and their management companies are required to provide notices when any property rental restrictions expire or affordability is terminated. Currently, owners of affordable housing properties in the City of Los Angeles must comply with federal and state notice requirements.
Federal Notice Requirements:
HUD requires owners of Multifamily HUD financed and assisted housing who do not wish to renew their rental subsidies or terminate (prepay) a HUD insured or subsidized mortgage to provide HUD and tenants with notices regarding the affordability of their housing.
HUD Rental Housing Assistance Termination: 1-year notice
1-Year Notice: To HUD, tenants and public local entities
4-Month Notice: Owners are required to provide HUD with a 4-month notice of their final option to renew the rental subsidy, choose other available program or terminate the subsidy (opt-out).
Prepayment of HUD Held/Insured Mortgage:
* Please note that owners of federally subsidized properties have to comply with California Government Code Section 65863.10 notice requirements (please see California State Notice Requirements section).
State of California Notice of Intent Requirements - Code Sections 65863.10, 65863.11, & 65863.13.
By state law, owners of specified federally-assisted, state, and locally-assisted projects are required to provide Notices of Expiration, Notices of Intent to prepay a federally-assisted mortgage, terminate mortgage insurance, or terminate rent subsidies or restrictions on affordable housing with expiring affordability restrictions.
These Notices of Intent must be sent to all affected tenants and to affected public agencies. Affected public agencies include the City of Los Angeles, Office of the Mayor, the Los Angeles Housing + Community Investment Department (HCIDLA), Housing Authority of the City of Los Angeles (HACLA), and the State's Department of Housing and Community Development (HCD).
Requirements: On September 27, 2010, the Governor signed Senate Bill 454 (Lowenthal). This bill deletes the sunset date on three sections of law, clarified and added additional requirements. This bill (now law), is effective January 1, 2011. Updated requirements and information will be posted soon.
California Government Code Section 65863.10: Requires Notices of Intent at twelve and six months, unless the projects are exempted (see 65863.13).
- California Government Code Section 65863.11: Requires an exclusive Notice of Opportunity to Submit an Offer to Purchase to be sent to Qualified Entities at least twelve months prior to sale or termination of use restrictions. For more information on Qualified Entities, please visit the State’s HCD website.
- California Government Code Section 65863.13: This section exempts certain preservation projects that meet specific criteria from the State Notice requirements. This exemption applies to projects where an owner is prepaying a federally-assisted mortgage and comparable long-term affordability restrictions on the project will be maintained.
State Notification (Notice of Intent) Enforcement:
The City currently tracks and enforces the State’s Notice requirement law Code Sections 65863.10, 65863.11, & 65863.13. Owners of properties with expiring rental restrictions or properties where affordability is being terminated must comply with these requirements. The AHPP proactively tracks the notifications received by the state and the city. If you need more information about the notification requirements, sample notices or need more guidance, please visit the State’s HCD website or contact the AHPP staff at (213) 808-8651 or email@example.com.
Notifications to the City should be addressed and sent to the following:
Mayor Eric Garcetti
City of Los Angeles
Affordable Housing Preservation
200 North Spring Street, Room 303
Los Angeles, CA 90012
Telephone: (213) 978-0600
Los Angeles Housing + Community Investment Department (HCIDLA)
Public Policy and Research Unit – AHPP
1200 W. 7th Street, 9th Floor
Los Angeles, CA 90017
Phone: (213) 808-8446
Fax: (213) 808-8410