Cal. Code Regs. Tit. 25, § 7866 - Return on Investment
(a) A sponsor which is not a nonprofit
corporation or a governmental agency shall be entitled to distribute earnings
in an annual amount not to exceed six percent (6%) of the sponsor's actual
investment in a rental housing development.
(b) Notwithstanding subdivision (a), the
Committee may authorize such sponsor to distribute earnings of an amount
greater than six percent (6%) but not to exceed ten percent (10%) on a family
rental housing development if it determines:
(1) that without the allowance of such
greater rate of return the Department would not be able to comply with the
requirements of Section 50736 of the Code, and
(2) that such greater rate of return is
reasonable taking into account all the circumstances of the rental housing
development.
(c) At a
time to be determined by the Department, the responsible agency shall certify
to the Department as to the amount of the sponsor's investment on which the
allowable return will be calculated. Such amount shall include the sponsor's
actual investment in the rental housing development, other than any unaccrued
liabilities of the sponsor.
(d) The
funds for return on investment may be distributed to owners only at the end of
each fiscal year as determined in the regulatory agreement and after all
project expenses have been paid, or funds set aside for their payment; all
reserve requirements have been met; and excess annuity payments and rents have
been recaptured. Any shortfall in return on investment may be made up from
surplus project funds in future years.
(e) The provisions of this section do not
apply to sponsor's return on investment under the rights of occupancy
component.
Notes
2. Certificate of Compliance transmitted to OAL 3-13-81 and filed 4-14-81 (Register 81, No. 16).
Note: Authority cited: Section 50737, Health and Safety Code. Reference: Section 50746, Health and Safety Code.
2. Certificate of Compliance transmitted to OAL 3-13-81 and filed 4-14-81 (Register 81, No. 16).
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