CHAPTER 3. MUTUAL HOUSING ASSOCIATIONS
IC 5-20-3
Chapter 3. Mutual Housing Associations
IC 5-20-3-1
"Families of low and moderate income" defined
Sec. 1. As used in this chapter, "families of low and moderateincome" has the meaning set forth in IC 5-20-1-2.
As added by P.L.69-1989, SEC.3.
IC 5-20-3-2
"Housing project" defined
Sec. 2. (a) As used in this chapter, "housing project" means anywork or undertaking to provide decent, safe, and sanitary urban orrural dwellings, apartments, or other living accommodations forfamilies of low and moderate income, including:
(1) buildings, land, equipment, facilities, and other real orpersonal property for necessary, convenient, or desirableappurtenances, streets, sewers, water service, parks, sitepreparation, gardening, administrative, community, recreational,commercial, or welfare purposes; and
(2) the acquisition and rehabilitation of existing dwelling unitsor structures to be used for moderate or low rental units.
(b) The term includes the planning of the buildings andimprovements, the acquisition of property, the demolition of existingstructures, the construction, reconstruction, alteration, and repair ofthe improvements, and all other connected work. The term includesthe reconstruction, rehabilitation, alteration, or major repair ofexisting buildings or improvements.
As added by P.L.69-1989, SEC.3.
IC 5-20-3-3
"Mutual housing association" defined
Sec. 3. As used in this chapter, "mutual housing association"refers to a corporation established under section 4 of this chapter.
As added by P.L.69-1989, SEC.3.
IC 5-20-3-4
Establishment of mutual housing association; articles ofincorporation
Sec. 4. (a) A mutual housing association may be established as anonprofit corporation incorporated under IC 23-7-1.1 (before itsrepeal on August 1, 1991) or IC 23-17 to prevent and eliminateneighborhood deterioration and to preserve neighborhood stabilityby:
(1) providing high quality, long term housing for families oflow and moderate income; and
(2) affording community and residential involvement in theprovision of that housing.
(b) The articles of incorporation of a mutual housing associationmust be approved by the authority. (c) The articles of incorporation of a mutual housing associationmust include a provision that provides that if the mutual housingassociation dissolves, is involved in a bankruptcy proceeding, orotherwise disposes of its physical properties, the association mayonly transfer the assets to another entity that provides high qualitylong term housing for families of low and moderate income.
As added by P.L.69-1989, SEC.3. Amended by P.L.179-1991, SEC.8;P.L.1-1992, SEC.12; P.L.1-2006, SEC.108 and P.L.181-2006,SEC.23; P.L.145-2008, SEC.8.
IC 5-20-3-5
Articles of incorporation of mutual housing association; purposes
Sec. 5. A mutual housing association must have as one (1) of itspurposes in its articles of incorporation the construction,rehabilitation, development, ownership, or operation (including themanagement and maintenance of housing) of high quality long termhousing for families of low and moderate income.
As added by P.L.69-1989, SEC.3.
IC 5-20-3-6
Contracts for state financial assistance; mutual housingassociations; grants and loans
Sec. 6. The Indiana housing and community developmentauthority may enter into a contract with a mutual housing associationto provide financial assistance for the construction, rehabilitation,ownership, or operation of housing for families of low and moderateincome. State financial assistance may be in the form of grants,loans, or a combination of grants and loans and may be used for theacquisition or development of housing sites and for the costs incurredin the development of the housing. Grants may not exceed thedevelopment cost of the housing project.
As added by P.L.69-1989, SEC.3. Amended by P.L.1-2006, SEC.109and P.L.181-2006, SEC.24.
IC 5-20-3-7
Contracts for state financial assistance; mutual housingassociations; provisions
Sec. 7. A contract for state financial assistance with a mutualhousing association under section 6 of this chapter must include (foreach housing site) the following provisions:
(1) Each housing site must be managed in an efficient mannerto permit the fixing of the rentals at the lowest possible ratesconsistent with providing decent, safe, and sanitary dwellingaccommodations.
(2) A mutual housing association may not construct or operatea housing site for profit.
(3) Rental rates may not be fixed a level higher than necessaryto produce revenue that, together with other revenue, will besufficient to pay, as it becomes due, the principal and intereston the loans made to the mutual housing authority, the
maintenance and operating expenses of a housing project(including insurance and administrative costs), and anallowance for a reasonable return on equity capital contributedto a housing project through membership fees or nonstategrants. The rentals must be within the financial reach offamilies of low income. The return on equity capital must beused by the mutual housing association to develop additionaldwelling units.
(4) The mutual housing association, subject to the approval ofthe Indiana housing and community development authority,shall fix the maximum income limits for the admission andcontinued occupancy of families in the housing. The associationshall define the income of a family to provide the basis fordetermining eligibility for the admission, rent, and continuedoccupancy of families under the maximum income limits. Indefining family income, the authority may provide for theexclusion of any part of the income of family members that theauthority believes generally available to meet the cost of basicliving needs of the family.
(5) The mutual housing association may not refuse to rent adwelling accommodation to an otherwise qualified applicantbecause one (1) or more of the proposed occupants are childrenborn out of wedlock.
(6) The mutual housing association shall provide each applicantfor admission to the housing project a receipt stating the timeand date of application and shall maintain a list of theapplications that must be available for public inspection. TheIndiana housing and community development authority shalladopt rules governing the form and procedure for maintainingthe list.
(7) The mutual housing association may require the payment ofa membership fee as a condition of eligibility of occupancy fora dwelling unit. The fee must be refunded to a resident member,with nominal interest, when the member vacates the dwellingunit.
(8) The Indiana housing and community development authorityshall require and must approve an operation management planfor each housing project from the mutual housing association.The plan must provide for an income adequate to pay debtservice, 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 theadministration of a housing project that must be approved bythe tenants and the Indiana housing and communitydevelopment authority. The association shall provide copies ofthe plan to each adult tenant and to the Indiana housing andcommunity development authority.
(9) The Indiana housing and community development authoritymay inspect any housing during the period of the loan or, in the
case of a grant, during the period when a housing project is usedto house families of low and moderate income.
(10) The mutual housing association shall semiannually submita report to the Indiana housing and community developmentauthority with information on operating costs, tenantinformation, rentals, and any other information that the Indianahousing and community development authority requires by rule.
(11) The mutual housing association may request permission ofthe Indiana housing and community development authority toallow the continued occupancy of dwelling units by tenantswhose annual income exceeds maximum limits or the rental ofvacant units to tenants whose income exceeds maximum limitsif the vacancies would result in the inability to pay debt service,administrative costs (including state service charges), operatingcosts, and reserve for repairs, maintenance, replacements, andcollection costs. The continued occupancy or rental must be fora period of one (1) year, subject to subsequent one (1) yearrenewals. The mutual housing association may, subject to theapproval of the Indiana housing and community developmentauthority, fix rent at a higher level for tenants described in thissubdivision.
(12) The difference between the increased rent and the normalrent described in subdivision (11) must be used by the mutualhousing association to develop additional dwelling units orcredited against the rent owed by another low or moderateincome resident member of the association.
(13) The cost of options on housing sites, engineering andarchitectural services, and preliminary construction expensesmay, subject to the approval of the Indiana housing andcommunity development authority, be included as part of thecost of a project to be financed by a loan or grant.
(14) The mutual housing association may provide for variablerents based on family income.
As added by P.L.69-1989, SEC.3. Amended by P.L.1-2006, SEC.110and P.L.181-2006, SEC.25.
IC 5-20-3-8
Service charges; mutual housing associations; loans and grants
Sec. 8. The Indiana housing and community developmentauthority may assess a mutual housing association a service chargefor each loan or grant provided to the association.
As added by P.L.69-1989, SEC.3. Amended by P.L.1-2006, SEC.111and P.L.181-2006, SEC.26.
IC 5-20-3-9
Mutual housing association; resident requirements
Sec. 9. A resident of a mutual housing association:
(1) must participate in the ongoing operation and managementof the housing;
(2) must have a right to continue residing in the housing as long
as the resident complies with the terms of the occupancyagreement; and
(3) may not possess an equity or ownership interest in thehousing.
As added by P.L.69-1989, SEC.3.
IC 5-20-3-10
Rules
Sec. 10. The Indiana housing and community developmentauthority shall adopt rules under IC 4-22-2 to carry out this chapter.
As added by P.L.69-1989, SEC.3. Amended by P.L.1-2006, SEC.112and P.L.181-2006, SEC.27.