Bill 2781

                    Current Status

Bill Number:               2781
Ratification Number:       396
Act Number:                369
Introducing Body:          House
Subject:                   Relating to the definitions used in the
                           Housing Authorities Law

(A369, R396, H2781)

AN ACT TO AMEND SECTION 31-3-20, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE DEFINITIONS USED IN THE HOUSING AUTHORITIES LAW, SO AS TO CONFORM THE POWERS GRANTED TO MUNICIPAL, COUNTY, AND REGIONAL HOUSING AUTHORITIES WITH THOSE CONTEMPLATED UNDER THE INTERNAL REVENUE CODE AND APPLICABLE REGULATIONS RELATING TO ASSISTING LOWER INCOME FAMILIES TO FIND SAFE, SANITARY, AFFORDABLE RENTAL HOUSING, SECTION 31-3-540, RELATING TO THE DUTIES OF A HOUSING AUTHORITY WITH RESPECT TO RENTAL AND TENANT SELECTION, SO AS TO ADD PERSONS OF MODERATE TO LOW INCOME TO THOSE AUTHORIZED TO RENT OR LEASE ACCOMMODATION IN HOUSING PROJECTS AND TO DELETE THE PROVISIONS WHICH SPECIFY THE AGGREGATE ANNUAL NET INCOME ABOVE WHICH A PERSON WOULD NOT QUALIFY TO LIVE IN A HOUSING PROJECT, AND PROVIDE THAT THE PROVISIONS OF THIS ACT DO NOT APPLY TO THE FINANCING, ACQUISITION, AND CONSTRUCTION OF SINGLE-FAMILY DWELLING BY THE STATE HOUSING AUTHORITY, AND TO REQUIRE THE BUDGET AND CONTROL BOARD TO AUTHORIZE THE ISSUANCE OF NOTES OR BONDS BY AN AUTHORITY AFTER THE SUBMISSION BY THE AUTHORITY TO THE BOARD.

Whereas, the Housing Authorities Law (Title 31, Chapter 3, Code of Laws of South Carolina, 1976) authorizes city, county, and regional housing authorities created pursuant to Articles 5, 7, and 9, respectively, to engage in certain activities in order to provide, or promote the provision of, safe and sanitary dwelling accommodations to persons of low income at rentals they can afford; and

Whereas, with respect to each of the city, county, and regional housing authorities, "persons of low income" is presently defined in item (15) of Section 31-3-20 of the 1976 Code so as to include "persons or families who lack an amount of income which is necessary (as determined by the authority undertaking the project) to enable them without financial assistance to live in decent, safe, and sanitary dwellings without overcrowding..."; and

Whereas, the existing statutory definition provides little practical guidance to an authority in ascertaining whether a particular project satisfies the requirements of the Housing Authorities Law; and

Whereas, Section 31-13-170 of the 1976 Code establishes a mathematically ascertainable definition of "persons of moderate to low income" for the South Carolina State Housing Authority, to include "those individuals who are members of households whose gross income falls between seventy-five percent and one hundred fifty percent of the 'median gross income' of all households in South Carolina as determined on the basis of the latest available statistics furnished to the Authority by the Division of Research and Statistical Services of the State Budget and Control Board. Gross income means income derived from any source whatsoever. An allowance for each member of the family equal to an amount for personal exemptions as defined by the South Carolina Income Tax Law, Section 12-7-310 of the 1976 Code, must be deducted from gross income in order to qualify a person or family as a member of the beneficiary class"; and

Whereas, the General Assembly finds that there continues to exist within the State a serious shortage of sanitary and safe residential housing at rentals which persons and families of both moderate and low income can afford, which shortage will continue to contribute to the persistence of substandard living conditions inimical to the health, welfare, and prosperity of all residents of the State; and

Whereas, the General Assembly further finds that the city, county, and regional housing authorities of this State have expressed a willingness and desire to assist in remedying the present shortage of such sanitary and safe residential rental housing; and

Whereas, changes in the national economy since the 1930s when the Housing Authorities Law was adopted require that the public sector provide some assistance to persons whose income is above the lowest income categories if these persons are to have a reasonable prospect of living in safe and sanitary housing; and

Whereas, the federal government has, under Section 103(b)(4)(A) of the Internal Revenue Code of 1954, as amended, restricted the exemption for bonds issued for residential rental property such that fifteen to twenty percent (depending upon whether the general area is one of chronic economic distress) of the units financed with tax exempt bonds are required to be set aside for low income individuals or families. However, for purposes of the federal law, persons of low income are limited to eighty percent of the median gross income for the area. Now, therefore,

Be it enacted by the General Assembly of the State of South Carolina:

Applicability of act

SECTION 1. It is intended by the provisions of this act that the city, county, and regional housing authorities have the same powers presently granted to the State Housing Authority by the provisions of Act 76 of 1977 with respect to multi-family housing only. The provisions of this act do not apply to the financing, acquisition, or construction of single family dwellings by the State Housing Authority.

Following a determination made by an Authority that a series of notes or bonds must be sold and a finding that the revenues or other moneys estimated to thereafter be available for the repayment thereof will provide moneys required for the payment of the principal and interest on the notes and bonds outstanding and the notes or bonds then proposed to be issued, the Authority shall submit the following information to the Budget and Control Board:

(1) The principal amount of the notes or bonds proposed to be issued.

(2) The purpose or purposes for which the proceeds of such notes or bonds are to be expended.

(3) The maturity schedule of the notes or bonds proposed to be issued.

(4) A schedule showing the annual debt service requirements on all outstanding notes or bonds of the Authority.

(5) A schedule showing the amount and source of revenues available for the payment of the debt service requirements established by the schedule required in item (4).

(6) The method to be employed in selling the proposed notes or bonds.

(7) Any other information which the Budget and Control Board shall require.

If the Budget and Control Board shall determine that the funds estimated to thereafter be available for the repayment of the Authority's notes and bonds, including the proposed notes or bonds, will be sufficient to provide for the payment of the principal and interest on the Authority's notes and bonds thereafter to be outstanding as they become due, the Budget and Control Board is authorized to give its approval to the issuance, in whole or in part, of the proposed notes or bonds, subject to such conditions, if any, as it may impose.

Definition

SECTION 2. Item (15) of Section 31-3-20 of the 1976 Code is amended to read:

"(15) 'Persons of low income' means those individuals who are members of households whose gross income falls below seventy-five percent of the 'median gross income' of all households in South Carolina as determined on the basis of the latest available statistics furnished to the Authority by the Division of Research and Statistical Services of the State Budget and Control Board. Gross income means income derived from any source whatsoever. An allowance for each member of the family equal to an amount for personal exemptions as defined by the South Carolina Income Tax Law, Section 12-7-310, must be deducted from gross income in order to qualify a person or family as a member of the 'beneficiary class'; and"

Definition

SECTION 3. Section 31-3-20 of the 1976 Code is amended by adding the following item:

"(17) Persons of moderate to low income means those individuals who are members of households whose gross income falls between seventy-five percent and one hundred fifty percent of the 'median gross income' of all households in South Carolina as determined on the basis of the latest available statistics furnished to the Authority by the Division of Research and Statistical Services of the State Budget and Control Board. Gross income means income derived from any source whatsoever. An allowance for each member of the family equal to an amount for personal exemptions as defined by the South Carolina Income Tax Law, Section 12-7-310, must be deducted from gross income in order to qualify a person or family as a member of the 'beneficiary class'."

Duties of housing authority

SECTION 4. Section 31-3-540 of the 1976 Code is amended to read:

"Section 31-3-540. In the operation or management of housing projects, an authority shall at all times observe the following duties with respect to rentals and tenant selection:

(1) It may rent or lease the dwelling accommodations in the projects only to persons of low income or to persons of moderate to low income and at rentals within the financial reach of such persons;

(2) It may rent or lease to a tenant dwelling accommodations consisting of the number of rooms, but no greater number, which it considers necessary to provide safe and sanitary accommodations to the proposed occupants of the accommodations, without overcrowding."

Time effective

SECTION 5. This act shall take effect upon approval by the Governor.