Sec 41-3956. Housing development fund; purpose

A. The housing development fund is established for the purpose of implementing a housing demonstration program in areas in this state that contain state prison facilities. The fund consists of monies provided from the housing trust fund pursuant to section 44-313, subsection A, paragraph 1. The department shall administer the fund.

B. The department shall allocate fund monies as loans or grants for the construction or renovation of facilities for housing pursuant to this section or for advancing down payments, closing costs or mortgage amount reductions.

C. A project is eligible to receive funding if the project is within a twenty mile radius of an existing or future prison site. The communities of Buckeye, Douglas, Florence, Safford, Winslow and Yuma and other communities that are selected as sites for future prison facilities are eligible to receive monies pursuant to this section.

D. The department shall give preference to projects with local government support and commitments, including local general funds, fee waivers, government sponsored infrastructure improvements and land donations, and to projects that provide housing and shelter to families and individuals who are employed by state prison facilities.

E. Monies in the fund shall be used to provide long-term housing opportunities for low and moderate income households and for housing affordability for areas authorized under subsection C of this section.

F. Five hundred thousand dollars of the monies in the fund shall be used for housing in eligible areas. Other monies in the fund shall be used for any purpose provided by this section.

G. The director may issue loans from the fund to assist eligible communities in funding housing. The director may issue loans pursuant to the following terms and conditions:

1. The loans shall be made only for projects that meet the requirements of this section and that demonstrate financial viability.

2. The director may assess an administrative fee on each loan to cover the annual cost to this state of administering the loan program.

3. Each loan shall be evidenced by a contract or contracts between a political subdivision, a for profit or nonprofit housing developer and the director acting on behalf of the state or any combination of a political subdivision, a housing developer and the director. The contract shall provide for at least annual payments of principal and may provide for payment of administrative fees for the term of the loan.

4. Each contract shall provide that the attorney general may commence any action that is necessary to enforce the contract and to achieve the repayment of loans that are made pursuant to this section.

H. Loan payments and administrative fees received pursuant to subsection G of this section shall be deposited, pursuant to sections 35-146 and 35-147, in the housing development fund.

I. Monies in the fund may also be spent for grants or other purposes that meet the requirements that are imposed on the use of the monies.

J. The director shall report annually to the legislature on the status of the fund. The report shall include a summary of facilities for which funding was provided during the preceding fiscal year and shall show the cost and geographic location of each facility and the number of individuals who benefited from the construction or renovation of the facility. The report shall be submitted to the president of the senate and the speaker of the house of representatives no later than September 1 of each year.

K. Monies in the fund are continuously appropriated. On notice from the department, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

L. For any construction project financed by the department pursuant to this section, the department shall notify a city, town, county or tribal government that a project is planned for its jurisdiction and, before proceeding, shall seek comment from the governing body of the city, town, county or tribal government or an official authorized by the governing body of the city, town, county or tribal government. The department shall not interfere with or attempt to override the local jurisdiction's planning, zoning or land use regulations.