Texas Register, Volume 37, Number 38, Pages 7327-7532, September 21, 2012 Page: 7,389
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in a municipality, or the county commissioners, if located outside of a
municipality; and
(5) ten (10) business days before the public hearing, the
Development Owner must submit a draft notice of the hearing for ap-
proval by the Department. The Department will create and provide
upon request a sample notice and approve or amend the notice within
three (3) business days of receipt.
(c) Amendments to Direct Loan Terms. An Applicant may re-
quest a change to the terms of a loan or loan commitment. Any such re-
quest will be fully vetted and Applicants are encouraged to make such
requests in a timely manner providing sufficient time for the Depart-
ment staff to review and, if necessary, underwrite the changes. The
Executive Director or authorized designee may approve amendments
to loan terms as described in paragraphs (1) - (5) of this subsection.
Board approval is necessary for other any changes:
(1) extensions of up to twelve (12) months to the loan clos-
ing date in the loan Commitment. An Applicant must document good
cause, which may include constraints in arranging a multiple-source
closing;
(2) changes to the loan maturity date to accommodate the
requirements of other lenders or to maintain parity of term;
(3) extensions of up to six (6) months for the construction
completion or loan conversion date based on documentation that the
extension is necessary to complete construction and that there is good
cause for the extension. Such a request will generally not be approved
prior to initial loan closing;
(4) changes to the loan amortization or interest rate that
cause the annual repayment amount to change less than 20 percent;
and
(5) changes to other loan terms or requirements as neces-
sary to facilitate the loan closing without exposing the Department to
undue financial risk.
(d) HTC Extensions. Extensions must be requested if the orig-
inal deadline associated with carryover, the 10 Percent Test (including
submission and expenditure deadlines), or cost certification require-
ments will not be met. If the extension is requested at least thirty (30)
calendar days in advance of the deadline, no fee will be required; how-
ever, if the extension is requested at any point after the applicable dead-
line the applicable fee as further described in 10.901 of this chapter
must be submitted. Extension requests submitted after the deadline will
not be processed unless accompanied by the applicable fee. Extension
requests will be approved by the Executive Director or Designee, un-
less, at staffs discretion it warrants Board approval due to extenuating
circumstances stated in the request. The extension request must spec-
ify a requested extension date and the reason why such an extension is
required. Carryover extension requests will not be granted an extended
deadline later than December 1st of the year the Commitment was is-
sued.
10.406. Ownership Transfers (2306.6713).
(a) Ownership Transfer Notification. A Development Owner
must provide written notice to the Department as least thirty (30) cal-
endar days prior to any sale, transfer, or exchange of the Development
or any portion of the Development. Department approval must be re-
quested for any new member to join in the ownership of a Development,
except for changes to the limited partner or other partners required by
the investment limited partner. Furthermore, a Development Owner
may not transfer an allocation of tax credits or ownership of a Devel-
opment supported with an allocation of tax credits to any Person or
entity other than an Affiliate of the Development Owner or non-Con-
trolling Related Party for estate planning purposes unless the Develop-ment Owner obtains the Executive Director's prior, written approval of
the transfer. The Executive Director may not unreasonably withhold
approval of the transfer.
(b) Transfers Prior to 8609 Issuance. Transfers (other than to
an Affiliate or non-Controlling Related Party for estate planning pur-
poses included in the ownership structure) will not be approved prior
to the issuance of IRS Form(s) 8609 (for Housing Tax Credits) or the
completion of construction (for all Developments funded through other
Department programs) unless the Development Owner can provide ev-
idence that a hardship is creating the need for the transfer (e.g. potential
bankruptcy, removal by a partner, etc.). The Development Owner and
the proposed transferee must provide to the Department with a copy of
any applicable agreement between the parties to the transfer, including
any Third-Party agreement.
(c) Documentation Required. A Development Owner must
submit documentation requested by the Department, including but not
limited to a list of the names of transferees and Related Parties and
detailed information describing the experience and financial capacity
of transferees and related parties, to enable the Department to under-
stand fully the facts and circumstances that gave rise to the need for
the transfer and the effects of approval or denial. All transfer requests
must disclose the reason for the request. The Development Owner shall
certify that the tenants in the Development have been notified in writ-
ing of the transfer no later than thirty (30) calendar days prior to the
approval of the transfer request to the Department. Not later than five
(5) business days after the date the Department receives all necessary
information under this section, staff shall conduct a qualifications re-
view of a transferee to determine the transferee's past compliance with
all aspects of the Department's programs, LURAs and eligibility under
this chapter. If the Department determines that the transfer, involuntary
removal or replacement, was due to a default by the General Partner un-
der the Limited Partnership Agreement, or other detrimental action that
put the Development at risk of failure, staff may make recommenda-
tions to the Board for the debarment of the entity and/or its principals
and affiliates.
(d) Credit Limitation. As it relates to the Housing Tax Credit
amount further described in 11.4(a) of this title (relating to Tax Credit
Request and Award Limits), the credit amount will not be applied in
circumstances described in paragraphs (1) and (2) of this subsection:
(1) in cases of transfers in which the syndicator, investor or
limited partner is taking over ownership of the Development and not
merely replacing the General Partner; or
(2) in cases where the General Partner is being replaced if
the award of credits was made at least five (5) years prior to the transfer
request date.
(e) Penalties. The Development Owner must comply with any
additional documentation requirements as stated in Subchapter F of
this chapter (relating to Compliance Monitoring). The Development
Owner, as on record with the Department, will be liable for any penal-
ties imposed by the Department even if such penalty can be attributable
to the new Development Owner unless such ownership transfer is ap-
proved by the Department.
(f) Ownership Transfer Processing Fee. The ownership trans-
fer request must be accompanied by corresponding ownership transfer
fee as outlined in 10.901 of this chapter (relating to Fee Schedule).
10.407. Right ofFirst Refusal.
(a) General. This section applies to LURAs that provided an
incentive for Development Owners to offer a Right of First Refusal
to nonprofit or tenant organizations. The purpose of this section is
to provide administrative procedures and guidance on the valuationPROPOSED RULES September 21, 2012 37 TexReg 7389
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Texas. Secretary of State. Texas Register, Volume 37, Number 38, Pages 7327-7532, September 21, 2012, periodical, September 21, 2012; Austin, Texas. (https://texashistory.unt.edu/ark:/67531/metapth288980/m1/62/: accessed April 19, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting UNT Libraries Government Documents Department.