Mo. Code Regs. tit. 4 § 170-4.200
Current through Register Vol. 49, No. 24, December 16, 2024
Section 4 CSR 170-4.200 - Rules and Limitations on Earnings, Dividends, and Other Distributions by Approved MortgagorsPURPOSE: This rule provides regulatory control by the Missouri Housing Development Commission (commission) over approved mortgagors. It restricts the distribution of earnings and dividends on housing developments financed in whole or in part by the commission to a maximum of eight percent (8%) per year of the equity in the development, subject to the discretion of the commission, and prohibits any distributions except out of surplus cash, as defined in this rule.
(1) Net earnings, dividends, or other distributions, as defined in the state housing act, these regulations, or in the Missouri Housing Development Commission (commission) regulatory agreement, may be declared or made only as of or after the end of an annual, semiannual, or quarterly fiscal period.(2) The amount of any allowable net earnings, distributions, or disbursements from surplus cash of the development shall not exceed, in any one (1) fiscal year, eight percent (8%) per annum of the equity in a development.(3) The equity in a development shall consist of the difference between the mortgage(s) as reduced by the payment(s) to principal and development costs. With respect to every development, the commission shall establish equity at the time of cost certification, as approved and determined by the commission on all residential housing developments originated and funded under the regulations and standards of the state housing act. Equity may be increased with the written approval of the commission in the event of improvements to the development deemed essential. The commission's determination of equity should not be identified with the U.S. Department of Housing and Urban Development (HUD) determination of equity.(4) No net earnings, dividends, distributions, or other disbursements of any kind whatsoever shall be declared or made except out of surplus cash. Surplus cash shall be the amount of funds available and remaining after- (A) The payment of development expenses which may include:1. All sums due or required to be paid under the terms of any deed of trust note or regulatory agreement;2. All amounts required to be deposited in any reserve accounts required or otherwise approved by the commission, including, but not limited to, the reserve fund for replacements; and3. All obligations of the development (other than the deed of trust held by the commission) including, but not by limitation of, all costs and expenses of maintenance and operation, and all amounts paid for taxes, assessments, insurance premiums, and other similar charges, unless funds for payment are set aside, or deferment of payment has been approved by the commission; and(B) The segregation of- 1. An amount equal to the aggregate of all reserves required or otherwise approved by the commission and/or any other special funds required to be maintained by the development; and2. All tenants' security deposits held.(5) The right to any allowable net earnings, distributions, or disbursements from surplus cash shall be cumulative. Surplus cash shall be segregated into a separate residual receipts account which the commission may require be held jointly by the development and the commission. No disbursements may be made from this account for any purpose other than approved development expenses and permitted distributions of dividends, and no such distributions shall occur without the commission's consent.(6) No distribution of any kind may be made from borrowed funds. The development shall not borrow any funds for any purposes without prior written approval of the commission. AUTHORITY: section 215.030(5), (12), and (19), RSMo 2000.* Original rule filed May 24, 2010, effective Jan. 30, 2011 . *Original authority: 215.030, RSMo 1969, amended 1974, 1982, 1985, 1989, 1993, 1995, 1998.