Project Operating Account. Disbursements from the Operating Account established pursuant to Section 3.03 shall be governed by the following: (a) From the funds collected and held by Manager in the Operating Account pursuant to Section 3.03 hereof and subject to Owner’s approved operating budget, Manager shall make the following disbursements promptly when payable, in the following order of priority: (i) real estate taxes and assessments and fire and hazard insurance premiums (including any required monthly escrow payments therefor), utilities, interest on the Mortgages, amortization of the principal of the Mortgages, fees and establishment and maintenance of all reserve funds; (ii) other payments due and payable by Owner as operating expenses incurred pursuant to Owner’s approved operating budget and in accordance with this Agreement; (iii) $50 per Unit per month to the Home Ownership Assistance Fund, in accordance with Section 3.15; (iv) Manager’s compensation and reimbursements (including any accrued fee and any interest thereon); and (v) distributions to or at the direction of Owner, including distributions to Owner’s members in accordance with Owner’s Operating Agreement. Owner directs Manager to deposit/transfer funds to an interest-bearing account or accounts in Owner’s name for the purpose of escrowing moneys for future expenses or for the purpose of decreasing funds held in the Operating Account not required for the payment of normal day-to-day operating expenses. OWNER ACKNOWLEDGES THAT TENANT SECURITY DEPOSITS ARE THE LIABILITY OF THE OWNER. MANAGER SHALL COLLECT THE SECURITY DEPOSITS AND HOLD THEM IN THE SECURITY DEPOSIT ACCOUNT AND SHALL ONLY DISBURSE SECURITY DEPOSIT MONEYS ACCORDING TO THE TERMS SET OUT IN THE TENANT’S LEASE AGREEMENT AND APPLICABLE LAW. Funds in the Security Deposit Account shall not be utilized to pay the Project's expenses. (b) In the event that the balance in the Operating Account is at any time insufficient to pay disbursements due and payable under this Section 3.08, Manager shall promptly inform Owner of the fact, and Owner will then remit to Manager sufficient funds to cover the deficiency. In no event shall Manager be required to use its own funds to pay such disbursements.
Appears in 6 contracts
Samples: Land Use Restriction Agreement, Land Use Restriction Agreement for Low Income Housing Tax Credits, Land Use Restriction Agreement for Low Income Housing Tax Credits
