(a) At the time of settlement, the homesteader shall take free and clear title to property subject only to the terms of an abatement agreement and this chapter. Each homesteader at the time of property settlement shall enter into an abatement agreement with the District, which shall include, but shall not be limited to, requirements that the homesteader perform the following:
(1) The homesteader (Residential) shall maintain the property as his or her principal dwelling place and residence for a period commencing with the date of property settlement and ending on the 5th anniversary of the settlement date. If the property cannot be lawfully occupied on the settlement date, the homesteader shall be considered in compliance with this residency provision if he or she takes occupancy within a reasonable period of time after the property has been brought into compliance with the Building Code approved pursuant to the Construction Codes Approval and Amendments Act of 1986 (“Building Code”), and the District of Columbia Housing Code (14 DCMR Chapter 1-14) (“Housing Code”).
(1A) The homesteader (Commercial) shall maintain title and ownership of the property for a period commencing with the date of property settlement and ending on the 10th anniversary of the settlement date. If the property cannot be lawfully occupied on the settlement date, the homesteader (Commercial) shall be considered in compliance with this ownership provision if the nonprofit organization or developer takes physical possession of the property within a reasonable period of time after the property has been brought into compliance with 12A DCMR, and 14 DCMR Chapters 1-14 (“Housing Code”).
(1B) The homesteader (Commercial) shall provide needed community services for at least 10 years to the residents of the District.
(2) The homesteader (Residential) shall participate in a Technical Training Program to be administered and conducted by groups selected pursuant to § 42-2109 .
(3) The homesteader (Residential) shall improve the property within 12 months of the starting date of the Technical Training Program to meet all applicable requirements of the Building Code and Housing Code.
(4) The homesteader (Residential) shall not sell, convey, lease, or otherwise alienate the property, or place liens or encumbrances on it, for at least 5 years from the date of property settlement without the written approval of the District.
(4A) The homesteader (Commercial) shall not sell, convey, or otherwise alienate the property, or place liens or encumbrances on it, for at least 10 years from the date of property settlement without written approval of the District.
(5) During the 5 or 10-year period, the homesteader shall permit periodic inspections of the property by the District or its agents or other persons duly authorized by the District for the purpose of determining the homesteader’s compliance with the requirements of the Program.
(6) The homesteader (Residential) shall maintain at all times during the 5 or 10-year period fire and extended coverage insurance with a face amount equal to at least 80% of the fair market value of the property.
(7) The homesteader (Residential) shall pay all taxes, fees, utility charges and assessments on the property from the date of settlement, except as otherwise provided in District law.
(b) Organizations to which residential buildings have been transferred shall certify that their members or other individuals who will reside in the buildings will meet the requirements of the abatement agreement and any other terms and conditions of the transfer imposed by the Mayor. Organizations to which commercial properties have been transferred shall certify that they will meet the terms of an abatement agreement that would require the rehabilitation of the property.
(b-1) At the time of settlement, an organization purchasing a property for residential rental use shall take free and clear title, subject only to the terms of an abatement agreement and this chapter. The purchaser shall enter into an abatement agreement with the District, which shall include requirements that the purchaser, for a period of at least 20 years, shall:
(1) Maintain the property in decent, safe, and sanitary condition and in conformity with all building codes;
(2) Reserve no fewer than 50% of units for low-income and moderate-income households and charge rents affordable to low-income households in no fewer than 25% of units;
(3) Allow periodic inspections of the property by the District or its agents;
(4) Maintain fire and extended coverage insurance with a face amount equal to at least 80% of the fair market value of the property; and
(5) Pay all taxes, fees, utility charges, and assessments on the property.
(c) Notwithstanding the provisions of subsection (a) of this section, if the homesteader (Residential) dies or has a total disability during the first 5 years after the original transfer to the homesteader (Residential), the homesteader’s personal representative may petition the Mayor on behalf of the homesteader’s heirs, devisees, and immediate family for an exemption from all or part of the terms of the abatement agreement. In ruling on the petition, the Mayor shall attempt to avoid any unreasonable burden upon the homesteader’s heirs, devisees, and immediate family.
(d) In the event a homesteader (Residential), or one of its organizational members, has received written approval from the District to alienate his or her interest in the property during the first 5 years of ownership, the homesteader (Residential) shall pay to the District an assessment fee according to the following formula:
(1) Eighty percent of the tax assessment value of his or her property (as determined at the time of original acquisition by the homesteader), if the alienation occurs within 0 to 15 months after the original acquisition;
(2) Sixty percent of the tax assessment value of his or her property (as determined at the time of original acquisition by the homesteader), if the alienation occurs within 16 to 30 months after the original acquisition;
(3) Forty percent of the tax assessment value of his or her property (as determined at the time of original acquisition by the homesteader), if the alienation occurs within 31 to 45 months after the original acquisition; and
(4) Twenty percent of the tax assessment value of his or her property (as determined at the time of original acquisition by the homesteader), if the alienation occurs within 46 to 60 months after the original acquisition.
(e) Assessment fees shall not take priority over any mortgage liens.
(f) The holder of a mortgage secured by the homesteader’s building or dwelling unit shall be exempt from the terms of the abatement agreement if the homesteader (Residential) defaults on the mortgage.