Interim Executive Director
Georgia Housing and Finance Authority
The project for real property acquisitions from the Resolution Trust Corporation for the Multifamily Affordable Housing Program is a project within the powers of the Georgia Housing and Finance Authority to undertake.
You have requested my opinion concerning the Multifamily Affordable Housing Program of the Georgia Housing and Finance Authority (the "Authority"). Specifically, the Authority plans to acquire by purchase certain multifamily housing projects, such as apartment complexes, from the Resolution Trust Corporation, acting as receiver, in its AHDP Direct Sales Program. There are certain covenants and restrictions on these properties which require a portion of the rental units be utilized for low income families and which are consistent with the objectives of the Authority's Multifamily Affordable Housing Program. The Authority will hold the properties for a time, and then transfer the properties to qualified non-profit private organizations under sometimes enhanced covenants requiring a proportion of units be allocated for very low, low and moderate income family housing. Moreover, additional requirements for rehabilitation or remodeling of the units are often specified obligations of the ultimate purchaser. The Authority often provides loan assistance to the purchaser in conjunction with private lenders.
The Authority is created pursuant to the Georgia Housing and Finance Authority Act, O.C.G.A. § 50-26-1 et seq. In its legislative findings the General Assembly has declared the public policy of the state as follows:
It is declared to be the public policy of this state to promote the health, welfare, safety,
morals, and economic security of its citizens through . . . the elimination of the shortage of and the preservation of safe, decent, energy efficient and affordable housing; and the elimination of the shortage of and the preservation of capital for housing finance.
O.C.G.A. § 50-26-2(b).
Among the powers of the Authority are the power to "acquire real and personal property in its own name to promote any of the public purposes of the authority," O.C.G.A. § 50-26-8(a)(16); to "hold title to any project financed by it," O.C.G.A. § 50-26-8(a)(20); to "manage property, intangible, real, and personal owned by the authority or under its control by lease or by other means," O.C.G.A. § 50-26-8(a)(25); to "sell . . . and to convey all or any part of any item of any project or facility for such price and upon such terms and conditions as the authority considers advisable and which are not in conflict with this chapter," O.C.G.A. § 50-26-8(a)(24); to "borrow money . . . to accomplish its public purposes," O.C.G.A. § 50-26-8(a)(6); to "pledge, mortgage, convey, assign, hypothecate, or otherwise encumber any property of the authority, including, but not limited to, real property, fixtures, personal property, intangible property, revenues, income, charges, fees, or other funds and to execute any lease, . . . loan agreement, mortgage, deed to secure debt, trust deed, security agreement, assignment, or other agreement or instrument as may be necessary or desirable," O.C.G.A. § 50-26-8(a)(7); to "extend credit, to make loans, to participate in the making of loans, to enter into commitments for the purchase of mortgages or participations, to acquire and contract to acquire mortgages or participations, to provide credit enhancement, and to provide or procure insurance;" O.C.G.A. § 50-26-8(a)(9); to "impose restrictive covenants which shall be deemed to be running with the land to any person, corporation, partnership, or other form of business entity which receives financial assistance from the authority," O.C.G.A. § 50-26-8(a)(30); to "make and execute contracts and all other instruments necessary or convenient for the performance of its duties and the exercise of its powers and functions under this chapter," O.C.G.A. § 50-26-8(a)(34); and to "incorporate one or more nonprofit corporations as subsidiary corporations of the authority for the purpose of carrying out any of the powers of the authority and to accomplish any of the purposes of the authority." O.C.G.A. § 50-26-8(a)(27).
With regard to the above powers, a "Project" includes "Housing and facilities used in connection therewith;" and "Housing finance." O.C.G.A. § 50-26-4(12). Further, "Housing" is defined as meaning: "...a specific work or undertaking, whether acquisition, new construction, or rehabilitation, which is: (A) designed or financed for the primary purpose of providing safe, decent, energy efficient, appropriate, and affordable dwelling accommodations for persons and families of low or moderate income." O.C.G.A. § 50-26-4(7). I have reviewed the form contracts prepared by the Resolution Trust Corporation designated as "Purchase and Sale Agreement," RTC AHDP Direct Sales Program, P & S Ver. 1.1, along with its exhibits, attachments and riders, to include the forms of real property instruments, specifically prepared and amended for the acquisitions of Carriage Crossing Apartments in Flowery Branch, Georgia, and Lake Vista Apartments in Warner Robins, Georgia. Those documents, and any documents following the form therein, but omitting the RTC requirements of Exhibit "B-1," pages 106 to 112, are in legal form and substance instruments which may be executed on behalf of the Authority and any subsidiary corporation of the Authority created pursuant to O.C.G.A. § 50-26-8(a)(27).
Further, the Authority has the power to undertake and perform the obligations of the Multifamily Affordable Housing Program, to include the acquisition, operation, management, and sale of properties from RTC as outlined. Subject to the approval of the board of directors of the Authority, no other consent, approval filing, authorization or similar action by any person or unit or instrumentality of local, state or federal government is required of the Authority in connection with the contract or instruments executed thereunder, and the Authority has the power to make, deliver, and perform under the contract and instruments executed thereunder.
Based upon the foregoing, it is my official opinion, rendered to the Authority and its members, that the program for real property acquisitions from the Resolution Trust Corporation for multifamily affordable housing constitutes a permissible project within the powers of the Georgia Housing and Finance Authority.
GEORGE S. ZIER
Assistant Attorney General