[§201H-42]  Private development of projects. 
(a)  The corporation may enter into contracts with any eligible bidder to
provide for the construction of a housing project or projects.  Each contract
shall provide that the housing project or projects shall be placed under the
control of the corporation as soon as the unit is available for occupancy. 
Each contract also shall provide that the capital stock of the mortgagor (where
the mortgagor is a corporate entity) be transferred to the corporation when the
housing project or projects have been completed.  Each contract shall contain
terms and conditions that the corporation may determine to be necessary to
protect the interests of the State.  Each contract shall provide for the
furnishing by the contractor of a performance bond and a payment bond with
sureties satisfactory to the corporation, and the furnishings of the bonds
shall be deemed a sufficient compliance with the provisions of law and no
additional bonds shall be required.  Before the corporation shall enter into
any contract as authorized by this section for the construction of a housing
project or projects, it shall invite the submission of competitive bids after
giving public notice in the manner prescribed by law.



(b)  Notwithstanding any other law to the
contrary, the corporation may:



(1)  Acquire the capital stock of mortgagors holding
property covered by a mortgage guarantee under this chapter and established by
this section; to exercise the rights as holder of the capital stock during the
life of the mortgage and, upon the termination of the mortgage, to dissolve the
mortgagor;



(2)  Guarantee the payment of notes or other legal
instruments of the mortgagors; and



(3)  Make payments thereon.



All housing projects placed under the control of the
corporation pursuant to this section shall be deemed to be housing projects
under the jurisdiction of the State.



(c)  On request by the corporation, the
attorney general shall furnish to the corporation an opinion as to the
sufficiency of title to any property on which a housing project is proposed for
construction, or on which housing projects have been constructed, under this
section.  If the opinion of the attorney general is that the title to the
property is good and sufficient, the corporation is authorized to guarantee, or
enter into a commitment to guarantee, the mortgagee against any losses that may
thereafter arise from adverse claims to the title.  None of the proceeds of any
mortgage loan hereafter insured shall be used for title search and title insurance
costs; provided that, if the corporation determines in the case of any housing
project that the financing of the construction of the project is impossible
unless title insurance is provided, the corporation may provide for the payment
of the reasonable costs necessary for obtaining title search and title
insurance.  Any determination by the corporation under this subsection shall be
set forth in writing, together with the reasons therefor.



(d)  The State shall be authorized to guarantee
the repayment of one hundred per cent of the principal and interest of loans
from commercial lenders for the purposes of this section pursuant to rules
adopted by the corporation which shall conform as closely as is possible to the
practices of the Federal Housing Administration in insuring loans under
Sections 203 and 207 of the United States Housing Act of 1937, as amended;
provided that at no time shall the State's liability, contingent or otherwise,
on the guarantees exceed $10,000,000. [L 2006, c 180, pt of §3]