SB 5647 — Creating a low-income home rehabilitation revolving loan program.

S-1059.1SENATEENGROSSED SENATE BILL 5647State of Washington65th Legislature2017 Regular SessionBy Senators Honeyford, Takko, Schoesler, and SaldañaRead first time 02/01/17.

and adding new sections to chapter 43.330 RCW.BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:NEW SECTION.  Sec. 1.  A new section is added to chapter 43.330 RCW to read as follows:The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.(1) "Home" means a single-family residential structure.(2) "Home rehabilitation" means residential repairs and improvements that address health, safety, and durability issues in existing housing in rural areas.(3) "Homeowner" means a person who owns and resides permanently in the home the person occupies.(4) "Low-income" means persons or households with income at or below two hundred percent of the federal poverty level as adjusted for family size and determined annually by the federal department of health and human services.(5) "Rehabilitation agency" means any approved department grantee, tribal nation, or any public service company, municipality, public utility district, mutual or cooperative, or other entity that bears the responsibility for rehabilitating residences under this chapter and has been approved by the department.(6) "Rural areas" means areas of Washington state defined as non-entitlement areas by the United States department of housing and urban development.NEW SECTION.  Sec. 2.  A new section is added to chapter 43.330 RCW to read as follows:(1) Subject to availability of amounts appropriated for this specific purpose, the low-income home rehabilitation revolving loan program is created within the department.(2) The program must include the following elements:(a) Eligible homeowners must be low-income and live in rural areas.(b) Homeowners who are senior citizens, persons with disabilities, families with children five years old and younger, and veterans must receive priority for loans.(c) The cost of the home rehabilitation must be the lesser of eighty percent of the appraisedassessed value of the homeproperty post rehabilitation or forty thousand dollars.(d) The maximum amount that may be loaned under this program may not exceed the cost of the home rehabilitation as provided in (c) of this subsection.(e)subsection, and must not result in total loans borrowed against the property equaling more than eighty percent of the assessed value.(e) The interest rate of the loan must be variableequal to the previous calendar year's annual average consumer price index compiled by the bureau of labor statistics, United States department of labor.(f) The department must allow participating homeowners to defer repayment of the loan principal and interest and any fees related to the administration or issuance of the loan.

Any amounts deferred pursuant to this section becomes a lien in favor of the state and hasis prioritysecondary in rank over all other privileges, liens, monetary encumbrances, or other security interests affecting the real property, whenever incurred, filed, or recorded, except for local and special district property tax assessments.

All amounts due under the loan become due and payable upon the sale of the home,home or upon the change ofin ownership of the home, or at such time the homeowner no longer resides permanently in the home.(3) All moneys from repayments must be deposited into the low-income home rehabilitation revolving loan program account created in section 4 of this act.(4) The department must adopt rules for implementation of this program.NEW SECTION.  Sec. 3.  A new section is added to chapter 43.330 RCW to read as follows:(1) The department must contract with rehabilitation agencies to provide home rehabilitation to participating homeowners.