Section 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.Cal. Code Regs. Tit. 25, § 7866
1. Amendment of subsection (a) and new subsection (e) filed 11-13-80 as an emergency; effective upon filing (Register 80, No. 46). A Certificate of Compliance must be transmitted to OAL within 120 days or emergency language will be repealed on 3-13-81.
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.
1. Amendment of subsection (a) and new subsection (e) filed 11-13-80 as an emergency; effective upon filing (Register 80, No. 46). A Certificate of Compliance must be transmitted to OAL within 120 days or emergency language will be repealed on 3-13- 81.
2. Certificate of Compliance transmitted to OAL 3-13-81 and filed 4-14-81 (Register 81, No. 16).