Section 7209.5 - Eligible Expenditures(a) The costs which may be paid from Program funds for the rehabilitation or construction of conventionally constructed housing are only those which are approved by the Department as reasonable and necessary for the construction or rehabilitation of the housing development, including, but not limited to, the following: (1) The cost of refinancing or acquiring land and any buildings thereon, including payments for commissions, options, deposits, or contracts to purchase properties on a proposed housing development site or payments for the purchase of such properties.(2) The cost of site preparation, demolition, and clearing.(3) Architectural, engineering, legal, accounting, packaging and other fees paid or payable in connection with the planning, execution, and financing of a housing development and the finding of an eligible mortgage for a housing development.(4) The cost of necessary reports, studies, surveys, plans, permits, and fees.(5) The cost of insurance, interest and financing, tax and assessment costs, and other operating and carrying costs incurred during construction or rehabilitation.(6) The cost of construction or rehabilitation of the housing development and related support facilities including material, direct labor, and actual construction supervision.(7) The cost of land improvements, including, but not limited to, landscaping, site preparation and streets, sewers, utilities, and other offsite improvements, whether or not such costs are paid in cash or in a form other than cash.(8) A reasonable profit in addition to job overhead to the general contractor and subcontractors.(9) An allowance for reasonable reserves set aside to defray unanticipated additional development or rehabilitation costs and operating costs during the initial years of occupancy of the housing development.(10) Repayment of a predevelopment loan made by a public entity or nonprofit corporation incorporated in any state or the District of Columbia.(11) The cost of developing or modifying a housing development or structure so that it is accessible to and convenient for the elderly or disabled.(12) The cost of such other items, including tenant and homeowner relocation and tenant and homeowner counseling, as the Department shall determine to be reasonable and necessary for the development or rehabilitation of a housing development.(13) The cost of solar and other energy efficient alternative systems.(b) The costs which may be paid from Program funds for the purchase of a Manufactured Home are only those which are approved by the Department as reasonable and necessary for the acquisition and installation of the Manufactured Home including, but not limited to, the following:(1) Purchase of the Manufactured Home including taxes and registration fees; and(2) Delivery, installation, and set-up charges;(c) Unauthorized Costs. Program funds shall not be used for: (1) A recipient's project organization or planning costs including, but not limited to, administrative costs or developer fees.(2) Downpayment assistance.(d) Special Limitations. The following limitations on eligible expenses will apply. (1) Engineering Fees. These fees must not exceed prevailing rates unless an unusual engineering situation exists and is substantiated. Normally, the engineering fees allowable under RD and/or HUD-FHA schedules and practices will provide the upper limit for such cost expenditures.(2) Architectural Fees. These fees must not exceed prevailing rates unless an unusual architectural situation exists and is substantiated. Normally, the architectural fees allowable under RD and/or HUD-FHA schedules and practices will provide the upper limit for such expenditures.(3) Grant or Loan Packager Fees. Program funds may be used for such fees if all of the following occur: (A) The tasks and fees of the packager are enumerated in an agreement between the applicant and the packager which is subject to prior approval by the Department;(B) The applicant is incapable of carrying out the task for which these services are sought;(C) The applicant does not have the funds with which to hire a packager;(D) Payments to the packager are staged in accordance with the completion of various tasks;(E) For RD financed housing developments, such fees will be disbursed from the Fund only if, in advance of the initial disbursement, RD approves the use of a packager and the fees to be paid; and(F) Charges payable from Program funds for such fees may be approved to a maximum of 1% of the housing development's costs or $100 per unit, whichever is less.(4) Legal Fees. These fees must be reasonable relative to the legal work required. Normally, the legal fees allowable under RD and/or HUD-FHA schedules and practices will provide the upper limit for such expenses. Billings or statements for legal services must be itemized.(e) Waivers. The Director may waive any requirement of this section not required by law if it is determined that such requirement would adversely affect the purposes of the grant program or that such requirement would impose an intolerable burden on the grantee.Cal. Code Regs. Tit. 25, § 7209.5
1. Renumbering of former section 7206 to new section 7209.5, including amendment of section, filed 4-2-2008; operative 5-2-2008 (Register 2008, No. 14). Note: Authority cited: Sections 50402 and 50406, Health and Safety Code. Reference: Section 50517.5, Health and Safety Code.
1. Renumbering of former section 7206 to new section 7209.5, including amendment of section, filed 4-2-2008; operative 5-2-2008 (Register 2008, No. 14).