Cal. Code Regs. tit. 25 § 7926

Current through Register 2024 Notice Reg. No. 50, December 13, 2024

Section 7926 - Improvements

(a) The recipient must obtain approval by the Department as to the eligibility of contemplated improvements prior to initiating such improvements.

(b) The value of improvements to assisted property shall be determined at the time such improvements are made, in the following manner:

(1) Where improvements are made which increase the value of the property, the value of such improvements shall be the amount, if any, by which the value of the property after the improvements are made exceeds the value of the property before the improvements are made,

(A) less the amount, if any, by which the value of the property has been increased by other work not constituting improvements performed between the two valuations, and

(B) plus the cost to the recipient of the appraisals to determine the value of the property before and after the improvements were made in accordance with this section.

The improvements adjustment to be made to the purchase price under Section 7914(c) (4) and (d) (5) shall be calculated in accordance with the following formula:

	E =	(V₁ x E₁) + I
		V₁ + I

E is the proportion of the value to which the household is entitled after improvements

V₁ is the value of the property immediately before the improvements are made

I is the value of the improvements (in accordance with subdivisions (1) of this section)

E₁ is the proportion of the value of the property to which the household is entitled immediately before the improvements were made

On each occasion that the property is improved, a new value for E shall be determined by applying the formula. The value of E thus determined will be used as E₁ the next occasion on which improvements are made. The amount to which the household shall be entitled on sale or termination of state financial assistance shall be the sale price or fair market value multiplied by the value of E at the time of sale or termination.

(2) Where the improvements made do not increase the value of the dwelling but bring the dwelling into conformance with local and state building or housing standards, the adjustment for improvements under Section 7914(c) (4) and (d) (5) shall be calculated in accordance with Section 7928(c), except that the value for "R" shall be the actual costs of improvements as supported through receipts, plus the cost to the recipient of an appraisal.

(c) Improvements shall not be the basis for a readjustment of the proportional amounts to which the Department and recipient are entitled upon sale of an assisted unit unless the costs to the recipient of making such improvements is at least five hundred dollars ($500.00).

(d) Whenever there is an adjustment to the proportional amounts to which the Department and recipient are entitled upon sale, the servicer of State loans shall ensure that a record of such an adjustment is kept and shall forward a copy to the Department and the governmental agency.

Cal. Code Regs. Tit. 25, § 7926

1. Amendment 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).
3. Amendment filed 6-11-81 as an emergency; effective upon filing (Register 81, No. 25).
4. Order of Repeal of 6-11-81 emergency order filed 6-19-81 by OAL pursuant to Government Code Section 11349.6 (Register 81, No. 25).
5. Amendment of subsections (b) and (d) filed 7-6-81 as an emergency; effective upon filing (Register 81, No. 28). A Certificate of Compliance must be transmitted to OAL within 120 days or emergency language will be repealed on 11-3-81.
6. Certificate of Compliance as to 7-6-81 order transmitted to OAL 10-23-81 and filed 11-18-81 (Register 81, No. 47).
7. Amendment of subsections (a) and (c) filed 4-30-82; effective thirtieth day thereafter (Register 82, No. 18).

Note: Authority cited: Sections 50406, 50776 and 50777, Health and Safety Code. Reference: Sections 50776 and 50777, Health and Safety Code.