(a) The state, acting by and in the discretion of the Commissioner of Housing, may contract with a nonprofit corporation for state financial assistance in the form of a state grant-in-aid, loan or deferred loan to such corporation on such terms and conditions as the commissioner may prescribe. Such grant-in-aid, loan or deferred loan shall be used by such corporation to acquire, hold, manage and convey title to or transfer interests in, real property for the purpose of providing for existing and future housing needs of very low, low and moderate income families. In the case of a deferred loan, the contract shall require that payments on interest are due currently but that payments on principal may be made at a later time. The commissioner may prescribe the terms and conditions (1) by which real property acquired under this section shall be either held for the existing and future housing needs of very low, low and moderate income families or placed in a community land trust, or (2) by which title to such real property shall be conveyed or interests in such property shall be transferred, for the purpose of providing for existing and future housing needs of very low, low and moderate income families, which purpose may include the development of (A) multifamily dwellings in which a portion of the units are not subject to income or rent restrictions, or (B) single-family dwellings that are not subject to income or rent restrictions. Such terms and conditions, in the discretion of the commissioner and with the approval of the State Bond Commission, may be subordinated in the case of a subsequent first mortgage or a requirement of a governmental program relating to such real property. Ancillary housing-related services may be located on such real property. The commissioner shall give notice of an application for financial assistance under this section which would complete a partially constructed housing development to the chief executive official of the municipality in which the real property is located. A nonprofit corporation holding title to such real property, with or without structures, may lease such real property to very low, low and moderate income families, limited equity cooperatives or other corporations, provided the terms of any such lease shall require that such real property be developed and used solely for the purpose of housing for very low, low and moderate income families. The lessee may hold title to any building or improvement situated on real property acquired with financial assistance made under this section, provided the nonprofit corporation holding title to such real property shall have first option to purchase any building or improvement that the lessee may place on such real property at a below-market price set forth in such lease. The legitimate heirs of any such lessee shall have the right under such lease to assume the lease upon the death of such lessee if the lessee is a natural person and if such heirs agree to make the leased premises their principal residence.

(b) A nonprofit corporation holding title to real property acquired with state financial assistance made under this section may convey title to or transfer interests in such real property to very low, low and moderate income families, limited equity cooperatives or other corporations, provided (1) the terms and conditions of any instrument conveying such title requires that any structures and improvements situated upon such real property be developed and used solely for the purpose of housing for very low, low or moderate income families, which may include the development of multifamily dwellings in which a portion of the units are not subject to income or rent restrictions. Such terms and conditions, in the discretion of the commissioner and with the approval of the State Bond Commission, may be subordinated in the case of a subsequent first mortgage or a requirement of a governmental program relating to such real property, (2) such title is conveyed or such interest is transferred in accordance with written policies of the nonprofit corporation governing conveyances of title and transfers of interest in real property, and (3) the nonprofit corporation shall have first option to purchase any structures and improvements transferred at a below-market price agreed to at the time of such transfer. A nonprofit corporation holding title to real property acquired with state financial assistance made under this section for which a declaration of condominium has been filed may transfer the units in such condominium to (A) another eligible nonprofit corporation as determined by the commissioner, or (B) very low, low or moderate income families in accordance with chapter 828, subject to deed restrictions, acceptable to the commissioner, requiring that the units be used solely for the purpose of housing for very low, low and moderate income families, provided in the case of a transfer under subparagraph (B) of this subdivision, the original nonprofit corporation shall have first option to purchase the unit at a below-market price agreed to at the time of acquisition of the unit by the family.

(c) (1) A nonprofit corporation existing on or after October 1, 1991, and holding title to real property acquired with state financial assistance made under this section may convey title to such real property, with the approval of the commissioner, to a community land trust corporation. (2) A nonprofit corporation holding title to real property which has been acquired with state financial assistance under this section for the existing and future needs of very low, low or moderate income families, may, with the approval of the commissioner and in accordance with its written policies governing conveyances of title, convey title to such real property to another nonprofit corporation or other entity. Any proceeds from the conveyance of title to such real property to such other entity shall be deposited in the Community Housing Land Bank and Land Trust Fund established under section 8-214c.

(d) A nonprofit corporation existing on or after October 1, 1991, and holding title to real property acquired with state financial assistance made under this section, may lease such real property, with the approval of the commissioner, to a partnership, as defined in section 34-301, or a limited partnership, as defined in section 34-9, provided the nonprofit corporation has a material role in such partnership or limited partnership. The terms of any such lease shall require that such real property be developed and used solely for the purpose of housing for very low, low and moderate income families. The lessee may hold title to any building or improvement situated on real property acquired with financial assistance made under this section, provided the nonprofit corporation holding title to such real property shall have first option to purchase any building or improvement that the lessee may place on such real property at a below-market price set forth in the lease.

(e) If a nonprofit corporation fails to develop the project in accordance with the development plan for the project and title to the land or interests in land acquired with state financial assistance under this section vests in the state pursuant to a default, foreclosure action, deed-in-lieu of foreclosure, voluntary transfer, or other similar voluntary or compulsory action, the commissioner may, upon approval of the State Bond Commission, convey such land or interests in land to the municipality in which the land or interests in land is located. The municipality shall use the land or interests in land, or shall cause the land or interests in land to be used for, or in conjunction with, activities related to, or similar to, any program administered by the commissioner pursuant to state or federal law.

(f) The Commissioner of Housing shall adopt regulations, in accordance with chapter 54, to carry out the purposes of sections 8-214b to 8-214e, inclusive. Such regulations shall include, without limitation, provisions concerning the terms and conditions of such grants-in-aid, loans or deferred loans and the conditions for approval of the articles of incorporation or basic documents of organization of a nonprofit corporation applying for assistance under said sections.

(g) As used in this section, housing-related services and facilities includes, but is not limited to, administrative, community, health, recreational, educational and child-care facilities relevant to an affordable housing development, as defined by the commissioner in regulations adopted in accordance with chapter 54.

(h) (1) On and after June 2, 2016, until January 1, 2017, the Commissioner of Housing may make a determination, based upon a full examination of the circumstances, that a nonprofit corporation is unable to develop or manage the land or interests in land acquired with state financial assistance under this section. Upon such a determination, the commissioner may cause title to the land or interests in land acquired with state financial assistance under this section to vest in the state by foreclosure, voluntary transfer or other similar voluntary or compulsory action, and the commissioner may take any action that is in the best interests of the state to convey, upon approval of the Secretary of the Office of Policy and Management, such land or interests in land, including, but not limited to, (A) transferring, or authorizing the transfer of, the land or interests in land to the low and moderate income families that reside on such land, (B) determining whether any restrictions in the deed or deeds for the land or interests in land shall be modified or removed prior to conveying such land or interests in land and authorizing such modifications or removals, or (C) establishing such terms and conditions for such conveyance as the commissioner deems appropriate under each particular transaction.

(2) The commissioner shall authorize the conveyance of land or interests in land under subdivision (1) of this subsection in no more than one location.

(P.A. 87-441, S. 3, 5; P.A. 90-238, S. 30, 32; P.A. 91-182; P.A. 92-70, S. 1; 92-166, S. 10, 31; May Sp. Sess. P.A. 92-11, S. 31, 70; P.A. 94-33; 94-50; P.A. 95-250, S. 1; 95-296, S. 4, 5; P.A. 96-77, S. 1, 17; 96-211, S. 1, 5, 6; 96-249, S. 1, 14; P.A. 99-243, S. 1, 2; P.A. 05-186, S. 1; P.A. 13-234, S. 31; May Sp. Sess. P.A. 16-1, S. 12; P.A. 17-240, S. 4.)

History: P.A. 90-238 substituted “real property” for references to land, applied provisions to “very low income families”, inserted new Subsec. (b) re conveyance of title to or interest in real property or structures upon it by nonprofit corporation holding title which acquired the property with state financial assistance, relettering former Subsec. (b) as (c); P.A. 91-182 amended Subsec. (a) to authorize the commissioner to prescribe terms and conditions for acquisition of real property under section and to permit ancillary housing related services on property acquired under section, inserted new Subsec. (c) to provide for certain transfers relettering former Subsec. (c) as (d) and added new Subsec. (e) to define housing-related services and facilities; P.A. 92-70 amended Subsec. (b) to add provision regarding sale by nonprofit corporations of condominiums acquired with financial assistance under section; P.A. 92-166 amended Subsec. (a) by making loans and deferred loans a form of financial assistance available under section and providing that payments on interest are due immediately but that payments on principal may be made at a later time and made technical changes to Subsec. (d), consistent with changes in Subsec. (a); May Sp. Sess. P.A. 92-11 made a technical change in Subsec. (b); P.A. 94-33 amended Subsec. (a) by adding provision that the commissioner of housing notify a municipality in which an application to complete a partially constructed housing development has been filed; P.A. 94-50 amended Subsecs. (a) and (b) by adding provision re subordination of use condition in the case of a subsequent first mortgage or requirement of a government program; P.A. 95-250 and P.A. 96-211 replaced Commissioner and Department of Housing with Commissioner and Department of Economic and Community Development; P.A. 95-296 inserted new Subsec. (d) re lease of property acquired with financial assistance under section and relettered former Subsecs. (d) and (e) accordingly, effective July 6, 1995; P.A. 96-77 amended Subsec. (d) to replace reference to “section 34-44” with “section 34-301”, effective July 1, 1997; P.A. 96-249 inserted new Subsec. (e) authorizing conveyance to municipalities upon failure of nonprofit corporation to fulfill development plan and relettered remaining Subsecs. accordingly, effective June 6, 1996; P.A. 99-243 added Subsec. (h) re authority of commissioner, under certain circumstances, to convey land acquired under this section, effective June 29, 1999; P.A. 05-186 amended Subsec. (b) to allow a nonprofit corporation to transfer units in a condominium acquired with financial assistance under this section to another eligible nonprofit corporation; P.A. 13-234 substituted “Commissioner of Housing” for “Commissioner of Economic and Community Development” in Subsecs. (a) and (f) and deleted former Subsec. (h) re conveyance of land, effective July 1, 2013; May Sp. Sess. P.A. 16-1 added Subsec. (h) re authority of commissioner to convey land acquired under section, effective June 2, 2016; P.A. 17-240 amended Subsec. (a) to add provision re conveyance of title to or transfer of interests in real property shall be permitted uses by nonprofit corporation of grants-in-aid, loan or deferred loan, designate provisions re holding of real property or placement in community land trust as Subdiv. (1) and add Subdiv. (2) re conveyance of or transfer of interests in real property for certain purposes, amended Subsec. (b) to replace “structures and improvements situated upon” with “or transfer interests in”, add provision re inclusion of development of multifamily dwellings in Subdiv. (1), and replace provision re retention of title by nonprofit corporation with provision re title conveyed or interest transferred in accordance with written policies of nonprofit corporation in Subdiv. (2), and amended Subsec. (c) to designate existing provisions re nonprofit corporation existing on or after October 1, 1991 as Subdiv. (1), designate provisions re nonprofit corporation holding title to real property acquired with state financial assistance as Subdiv. (2) and amend Subdiv. (2) to add reference to written policies governing conveyance of title, add “or other entity” and add provision re deposit of proceeds from such conveyance, and made technical and conforming changes.