Common use of Affordability Period and Regulatory Agreement Clause in Contracts

Affordability Period and Regulatory Agreement. A. Approved Projects involving rehabilitation or reconstruction shall be rent and income restricted and must remain affordable for a minimum affordability period of 15 years beginning upon the Department’s receipt of the Project Completion Report as defined in Section 30(A)(4) herein. B. Approved Projects involving new construction shall be rent and income restricted and must remain affordable for a minimum affordability period of 20 years beginning upon the Department’s receipt of the Project Completion Report as defined in Section 30(A)(4) herein. C. The affordability restrictions for each Approved Project will be evidenced and enforced by way of the applicable DR-MHP Regulatory Agreement, in form and substance provided by the Department, which Subrecipient must record against each real property in the official records of the County in which each Approved Project is located and shall have priority over other liens, encumbrances and other matters of record except as may be approved by the Department. Exceptions to the position of the DR-MHP Regulatory Agreement must be approved in writing and in advance by the Department. D. Each DR-MHP Regulatory Agreement shall remain in effect at all times during the affordability period. E. A sale or transfer of the Approved Project to another entity, in whole or in part and whether direct or indirect, during the affordability period is subject to the Department’s review and approval in its sole discretion. The Department is likely to find a sale or transfer acceptable, provided any prospective purchaser or transferee acknowledges that they and the Approved Project remain subject to the affordability restrictions and all other terms and conditions of the Approved Project’s DR-MHP Regulatory Agreement, which restrictions, terms, and conditions shall remain unmodified and in full force and effect during the term of that agreement and there is no change in the lien priority of that agreement.