P.R. Laws tit. 17, § 893
The Public and Private Sector Copartnership for the New Housing Operation Program is hereby created with the purpose of encouraging and promoting the development and rehabilitation of housing units, to be sold or rented to low- or moderate-income families and sold to middle-class families.
It is the public policy of the Commonwealth of Puerto Rico to ensure that every Puerto Rican family has the opportunity to enjoy an adequate home to the extent that the Government’s resources and efforts allow. Pursuant to this public policy, the purpose of this chapter is to encourage and achieve a close collaboration between the government and the private sector that will lead, in some degree and as soon as possible, to address and find a solution to the housing shortage problem faced by low- or moderate-income and middle-class families. Through the program created by this chapter, private businesses and individuals shall invest capital and assume the risks of such an investment. To encourage their investment and risk, the Commonwealth of Puerto Rico will grant them certain incentives, which translates to specific tax exemptions, as well as the opportunity to purchase lands owned by the Government that have no public use, provided they are devoted to the development of affordable housing and middle-class housing projects to be sold or rented to such families according and pursuant to the conditions established in this chapter. This shall not limit consequent tax incentives to be provided by law. Under no circumstances shall the establishment of excessive fees that result in a tacit jurisdictional prohibition for this type of housing be allowed. The Department of Housing regulations shall encourage agencies, public corporations, and municipalities to adapt those charges, whose maximum amount is not fixed by law, to this type of development in a fair manner, in order to enable the construction thereof and their subsequent acquisition at low prices by citizens in need of low-cost housing.
Benefits and economic or tax incentives legislated with the purpose of promoting the industry and the affordable and middle-class housing market shall also apply to the construction of predesigned homes, which shall require the corresponding construction permit for qualification or participation. In such cases, the requirement of use permits shall be left at the discretion of the regulations established by the government entity that grants the corresponding benefits.
In case that a housing project, regardless of its cost, has a serious limitation as to the marketing thereof, or because it is at risk of being subject to foreclosure or repossession, it may be devoted to partial, total, temporary, and/or permanent leasing, if convenient. Furthermore, if the same is located in a tourist zone, it may be converted to tourist use with the authorization of the Planning Board and qualify for the incentives provided by said industry.
In the evaluation, analysis, consideration, award, renegotiation, and revision of any incentives or benefits granted under this chapter, the Department of Housing and the Secretary thereof shall be required to oversee and ensure compliance with the following governing principles, as provided below:
(a) Jobs.— The incentivized housing project and the owner thereof shall promote the creation of new jobs.
(b) Sound integration.— The conceptual design and planning of the incentivized housing project shall be carried out, first of all, taking into account environmental, geographical, and physical aspects as well as the materials and goods that are abundantly available in the site where it is to be developed. Safe development shall be ensured to prevent catastrophic damages caused by potential natural disasters.
(c) Commitment to the economic activity.— The incentivized housing project and the owner thereof shall acquire raw materials and products manufactured in Puerto Rico for the construction, maintenance, renovation, or extension of the incentivized housing project for some or all of the types of materials used in the construction or rehabilitation of housing, as specified by the Secretary. If the purchase of said products is not financially justified when taking into account criteria such as quality, quantity, price, or availability of these products in Puerto Rico, or insofar as the Secretary determines that it can be accredited through an energy efficient or green building certification, the Secretary of the Department of Housing may issue a certificate attesting to such fact.
(d) Commitment to agriculture and the environment.— The incentivized housing project and the owner thereof shall not affect and/or mitigate any adverse effect that the operation thereof may have on land of high agricultural significance. The Secretary of the Department of Housing shall evaluate the particularities of each case and may issue a certificate attesting to such fact.
(e) Transfer of knowledge.— The incentivized housing project and the owner thereof shall acquire services from professionals or companies with a presence in Puerto Rico. However, if this is not possible due to criteria such as availability, experience, specificity, or skill, or any other valid reason recognized by the Secretary of Housing, the owner of the incentivized housing project may acquire such services through an intermediary with a presence in Puerto Rico, which shall contract directly with the service provider chosen by the owner of the incentivized housing project, in order to receive the requested services.
The term “services” shall mean, but the list below shall not be construed as limiting the Secretary of Housing to include others by regulations, as the contracting of jobs related to:
(1) Surveying, the production of construction plans, as well as engineering and architectural designs, and related services;
(2) construction and all that pertains to this sector;
(3) financial, environmental, technological, scientific, management, marketing, human resources, and auditing consulting services;
(4) advertising, public relations, commercial art, and graphic design services; and
(5) security or facility maintenance.
(f) Financial commitment.— The incentivized housing project and the owner thereof shall submit proof that they use the services of, and that they deposit a significant amount of the income derived from their economic activity in, banking and/or cooperative institutions with presence in Puerto Rico. If the financial activity cannot be financially justified when taking into account criteria such as the availability or accessibility of these institutions in Puerto Rico, or if federal funding, subsidies, or grants have been awarded the Secretary of Housing may issue a certificate attesting to such fact.
The Secretary of Housing shall be the sole official responsible for verifying and ensuring that the incentivized housing projects and the owners thereof meet the eligibility requirements established in this section and in this chapter.
If the incentivized housing project and the owner thereof partially meet the requirements established in this Section, the Secretary of Housing shall be required to establish a formula that allows for the quantification of the aforementioned factors, and for the subtraction of the requirement that has not been met from the total percentage of the specific credit, in order to obtain the exact percentage of the benefit in question.
The governing principles established in this section shall apply to every new incentivized housing project that applies for any of the benefits granted under this chapter after December 1 st, 2015. However, the provisions of this section shall apply to any request made by any incentivized housing project or owner thereof that has not been signed and completed prior to the aforementioned date.
Sustainable development shall be fostered through urban densification, the use of durable and good quality raw material, the implementation of innovative technologies and strategies, and the use of Puerto Rican manpower. Safe development shall be encouraged to prevent catastrophic damages caused by potential natural disasters. None of the foregoing shall impair the public interest and the public policy to conserve our land reserved for agriculture and local flora and fauna.
History —June 26, 1987, No. 47, p. 159, § 3; Dec. 29, 1989, No. 2, p. 643, § 2; Aug. 17, 2001, No. 118, § 2; Aug. 10, 2011, No. 171, § 1, retroactive to July 1, 2011; Nov. 17, 2015, No. 187, § 35.