§ 5-20-3-7 — Contracts for state financial assistance; mutual housing associations; provisions

A contract for state financial assistance with a
mutual housing association under section 6 of this chapter must include
(for each housing site) the following provisions:
(1) Each housing site must be managed in an efficient manner to
permit the fixing of the rentals at the lowest possible rates
consistent with providing decent, safe, and sanitary dwelling
accommodations.
(2) A mutual housing association may not construct or operate a
housing site for profit.
(3) Rental rates may not be fixed a level higher than necessary to
produce revenue that, together with other revenue, will be
sufficient to pay, as it becomes due, the principal and interest on
the loans made to the mutual housing authority, the maintenance
and operating expenses of a housing project (including insurance
and administrative costs), and an allowance for a reasonable
return on equity capital contributed to a housing project through
membership fees or nonstate grants. The rentals must be within
the financial reach of families of low income. The return on
equity capital must be used by the mutual housing association to
develop additional dwelling units.
(4) The mutual housing association, subject to the approval of the
Indiana housing and community development authority, shall fix
the maximum income limits for the admission and continued
occupancy of families in the housing. The association shall define
the income of a family to provide the basis for determining
eligibility for the admission, rent, and continued occupancy of
families under the maximum income limits. In defining family
income, the authority may provide for the exclusion of any part of
the income of family members that the authority believes
generally available to meet the cost of basic living needs of the
family.
(5) The mutual housing association may not refuse to rent a
dwelling accommodation to an otherwise qualified applicant
because one (1) or more of the proposed occupants are children
born out of wedlock.
(6) The mutual housing association shall provide each applicant
for admission to the housing project a receipt stating the time and
date of application and shall maintain a list of the applications
that must be available for public inspection. The Indiana housing
and community development authority shall adopt rules
governing the form and procedure for maintaining the list.
(7) The mutual housing association may require the payment of
a membership fee as a condition of eligibility of occupancy for a
dwelling unit. The fee must be refunded to a resident member,
with nominal interest, when the member vacates the dwelling
unit.
(8) The Indiana housing and community development authority
shall require and must approve an operation management plan for
each housing project from the mutual housing association. The
plan must provide for an income adequate to pay debt service,
administrative costs (including a state service charge), operating
costs, and adequate reserves for repairs, maintenance,
replacements, and vacancy and collection losses. In addition, the
mutual housing association shall adopt a plan for the
administration of a housing project that must be approved by the
tenants and the Indiana housing and community development
authority. The association shall provide copies of the plan to each
adult tenant and to the Indiana housing and community
development authority.
(9) The Indiana housing and community development authority
may inspect any housing during the period of the loan or, in the
case of a grant, during the period when a housing project is used
to house families of low and moderate income.
(10) The mutual housing association shall semiannually submit a
report to the Indiana housing and community development
authority with information on operating costs, tenant information,
rentals, and any other information that the Indiana housing and
community development authority requires by rule.
(11) The mutual housing association may request permission of
the Indiana housing and community development authority to
allow the continued occupancy of dwelling units by tenants whose
annual income exceeds maximum limits or the rental of vacant
units to tenants whose income exceeds maximum limits if the
vacancies would result in the inability to pay debt service,
administrative costs (including state service charges), operating
costs, and reserve for repairs, maintenance, replacements, and
collection costs. The continued occupancy or rental must be for
a period of one (1) year, subject to subsequent one (1) year
renewals. The mutual housing association may, subject to the
approval of the Indiana housing and community development
authority, fix rent at a higher level for tenants described in this
subdivision.
(12) The difference between the increased rent and the normal
rent described in subdivision (11) must be used by the mutual
housing association to develop additional dwelling units or
credited against the rent owed by another low or moderate income
resident member of the association.
(13) The cost of options on housing sites, engineering and
architectural services, and preliminary construction expenses
may, subject to the approval of the Indiana housing and
community development authority, be included as part of the cost
of a project to be financed by a loan or grant.
(14) The mutual housing association may provide for variable
rents based on family income.

Legislative History

As added by P.L.69-1989, SEC.3. Amended by P.L.1-2006, SEC.110 and P.L.181-2006, SEC.25.