Illinois Administrative Code
Title 47 - HOUSING AND COMMUNITY DEVELOPMENT
Part 310 - MULTIFAMILY RENTAL HOUSING MORTGAGE LOAN PROGRAM
Subpart D - MORTGAGE LOAN
Section 310.403 - Equity and Distributions
Current through Register Vol. 48, No. 12, March 22, 2024
a) Right to Distributions. As provided in the Act, an Owner shall have the right, commencing on the Initial Closing Date, to make annual Distributions in an amount not to exceed 6% of its Equity in a Development, except as otherwise provided pursuant to Sections 310.801 through 310.805, except that, if a Distribution cannot be made as provided in subsections (b) and (c) of this Section, an Owner may cumulate the right to make a Distribution. An Owner's right to a Distribution shall begin to cumulate on the Initial Closing Date. In any partial fiscal year in which an Owner is entitled to make a Distribution, the amount of a Distribution shall be calculated pro rata based on the number of days since the closing of the Mortgage Loan.
b) Source of Distributions. An Owner may make Current and Cumulative Distributions out of Surplus Cash and/or Residual Receipts. If Surplus Cash or Residual Receipts are unavailable in a given fiscal year, an Owner shall make no Current Distribution, but the right to make a Distribution shall cumulate. If Surplus Cash and/or Residual Receipts are insufficient in a given fiscal year to make a Distribution in an amount equal to 6%, or as otherwise permitted in Sections 310.801 through 310.805, of an Owner's Equity in a Development, an Owner may distribute all available Surplus Cash and/or Residual Receipts and cumulate the right to make the rest of the Distribution in future years when and if Surplus Cash and/or Residual Receipts are available.
c) Timing of Distributions. No Distribution shall be made until after the Final Closing Date. Even if Surplus Cash and/or Residual Receipts are available, the initial and all subsequent Distributions, including Cumulative Distributions, may be made only after the Authority has approved the Development's annual financial report (see Section 310.306 ); the Development has an approved Development budget for the next fiscal year; the Owner has complied with all outstanding notices of requirements for proper maintenance and operation of the Development; the Owner has cured any defaults or breaches of applicable Rules, contracts and agreements; and the Authority has issued its written authorization of the Distribution.
d) Amount of Equity. As required by the Act, the Authority shall establish an Owner's Equity in a Development on or after the Final Closing Date. In no event shall the amount of the Equity be calculated to include any grants or other funds not originating with the Owner. Once established by the Authority, the amount of an Owner's Equity shall remain constant so long as the Mortgage Note and Mortgage are outstanding on the Development, unless adjusted by resolution of the Members based on the criteria set forth in subsection (e).
e) Increase in Amount of Equity