2023 -- S 0866

========

LC002652

========

     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2023

____________

A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- HOUSING DEVELOPMENT

FUND

     Introduced By: Senators Kallman, Lombardo, Acosta, Cano, Euer, Burke, DiPalma,
Gallo, Quezada, and Mack

     Date Introduced: March 30, 2023

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. Title 42 of the General Laws entitled "STATE AFFAIRS AND

GOVERNMENT" is hereby amended by adding thereto the following chapter:

CHAPTER 55.2

HOUSING DEVELOPMENT FUND

     42-55.2-1. Short title.

     This chapter shall be known and may be cited as the "Housing Development Fund."

     42-55.2-2. Definitions.

     As used in this chapter:

     (1) "Affordable housing unit" means a unit that may be rented or sold to any individual

classified as "very low-income," "low-income" or "moderate-income" as those terms are defined in

federal law measured at the time of the purchase or for the duration of a rental tenancy of an eligible

unit.

     (2) "Applicant" means a developer or occupant applying for a grant of money or land, or

loan or conditional loan under this chapter.

     (3) "Business" means an entity registered with the secretary of state including, but not

limited to, a corporation as defined in § 44-11-1, a nonprofit corporation, benefit corporation,

limited liability company, and/or an unregistered business formed as a partnership, association or

sole proprietorship.

     (4) "Capital investment" in a development or development project means costs or expenses

by a business or any affiliate of the business incurred after application for: real estate asset

acquisition, site preparation, construction, repair, renovation, improvement, equipping, or

furnishing on real property or of a building, structure, facility, or improvement to real property.

     (5) "Department" means the department of housing established pursuant to § 42-64.34-1.

     (6) "Developer" means a person, firm, corporation, partnership, association, political

subdivision, public housing authority or other entity, whether for-profit or not-for-profit, that

proposes to divide, divides, or causes to be divided real property into a subdivision or proposes to

build, or builds a building or buildings or otherwise improves land or existing structures, which

division, building, or improvement of land qualifies for benefits under this chapter.

     (7) "Fund" means the housing development fund created pursuant to this chapter.

     (8) "Market rate housing unit" means a unit that may be sold to any individual earning any

amount without any income restriction and is sold at fair market value.

     (9) "Occupant" means a resident as a tenant, owner, or joint venture partner, occupying

space pursuant to a lease or other occupancy agreement within any structure or building developed

on land which is subject to assistance being provided from the fund.

     (10) "Owner-occupant" is an "occupant" who resides in a building or structure and is the

title holder of the parcel upon which the building or structure is situated.

     (11) "Project cost" means the costs incurred in connection with a project by an applicant

until the issuance of a permanent certificate of occupancy, or until such other time specified by the

secretary of housing.

     (12) "Project financing gap" means: the part of the total project cost that remains to be

financed after all other sources of capital have been accounted for (such sources will include, but

not be limited to, developer-contributed capital), which shall be defined through rules and

regulations promulgated by the department of housing.

     (13) "Real estate assets" shall be defined to include, but not be limited to: land, buildings,

fixtures, improvements, easements, rights-of-way, and all other rights of ownership, possession

and/or use associated with real property.

     (14) "Workforce related housing unit" means a unit that may be sold to any individual

earning above the threshold for an affordable housing unit, but below the maximum threshold set

pursuant to 26 U.S.C. § 143 as measured at the time of the purchase of an eligible unit or as may

otherwise be defined by federal law.

     42-55.2-3. Establishment of the fund -- Uses -- Composition.

     (a) The housing development fund (the "fund") is hereby established under the jurisdiction

LC002652 - Page 2 of 28

of and shall be administered by the department of housing in order to promote the development,

redevelopment and update of housing in order to make housing more affordable and more available

in the state.

     (b) The uses of the fund include:

     (1) Financing real estate asset acquisition by the department for the land bank described in

chapter 55.3 of title 42;

     (2) Filling project financing gaps for residential and multifamily real estate projects eligible

under the criteria created pursuant to § 42-165-6;

     (3) Financing public infrastructure and public facilities to support or enhance residential

development projects on land owned by the land bank or projects qualifying for development under

§ 42-165-6 including transportation, utility services such as water, sewer, electrical, and Internet

communications, parks, greenways, playgrounds and recreational spaces, and community facilities.

     (4) Hiring of per diem, project based, part-time, or seasonal staff as determined to be

necessary by the secretary of housing to assist municipalities in the planning and/inspection of

potential projects and projects that are provided assistance from the fund.

     (5) Provide support for voluntary "wraparound services" for those occupying housing units

completed with assistance from the fund to include, but not be limited to:

     (i) Coordination with other agencies to ensure social worker assignment;

     (ii) Assignment to an accountable care organization;

     (iii) Financial literacy training;

     (iv) Assistance in obtaining access to mental, social and behavioral health supports and

treatments;

     (v) Substance abuse recovery; and

     (vi) Other supports for residents to maintain their ability to fulfill the requirements of

tenancy as determined by the department.

     (c) The fund shall consist of:

     (1) Money appropriated from the American Recovery Program Act funds allocated to the

state;

     (2) Money appropriated in the state budget to the fund;

     (3) Money made available to the fund through federal programs or private contributions;

     (4) Repayments of principal and interest from loans made from the fund;

     (5) Proceeds from the sale, disposition, lease, or rental of collateral related to financial

assistance provided under this chapter;

     (6) Application or other fees paid to the fund to process requests for financial assistance;

LC002652 - Page 3 of 28

     (7) Recovery made by the department or on the sale of an appreciated asset in which the

department has acquired an interest under this chapter; and

     (8) Any other money made available to the fund.

     (d) No assets in the fund shall be subject to attachment, execution, lien or other legal

process, judicial or administrative, in law or in equity, except when a particular asset within the

fund is pledged as security for any loan agreement and in such case the particular asset shall be

subject to lien, attachment or execution for satisfaction of the loan only and no other assets in the

fund shall be taken, reached or applied.

     42-55.2-4. Assistance -- Powers of the department -- Reports.

     (a) An applicant seeking assistance under this chapter shall submit a request to the

department pursuant to an application procedure prescribed by the secretary of housing.

     (b) Any approval for funding under this chapter may only be granted under the authority

of the secretary of housing.

     (c) The secretary may set the terms and conditions for assistance under this chapter by

regulation, program design, request for proposals or other predetermined method for which

applicants may apply.

     (d) The secretary shall publish a report on the fund at the end of each fiscal year. The report

shall contain information on the commitment, disbursement, and use of funds allocated under the

fund. The report shall also, to the extent practicable, track the impact of projects that have been

completed using the fund including, but not limited to, information on housing availability and

economic data. The report is due no later than sixty (60) days after the end of the fiscal year, and

shall be provided to the speaker of the house of representatives, the president of the senate and the

secretary of commerce.

     42-55.2-5. Severability.

     If any clause, sentence, paragraph, section or part of this chapter shall be judged by any

court of competent jurisdiction to be invalid, such judgment shall not affect, impair or invalidate

the remainder thereof, but it shall be confined in its operation of the clause, sentence, paragraph,

section or part directly involved in the controversy in which that judgment shall have been rendered.

Notwithstanding the foregoing, in the event that any term or provision is judged by any court of

competent jurisdiction to be invalid, the general assembly shall promptly act to address such clause,

section, sentence, paragraph, or part directly involved in which the subject judgment shall have

been rendered in order to provide, as near as practicable, the result originally intended by such

clause, section, sentence, paragraph or part without running contrary to such judgment.

     SECTION 2. Title 42 of the General Laws entitled "STATE AFFAIRS AND

LC002652 - Page 4 of 28

GOVERNMENT" is hereby amended by adding thereto the following chapter:

CHAPTER 55.3

DEPARTMENT OF HOUSING LAND BANK PROGRAM

     42-55.3-1. Establishment of program.

     There is hereby established a program to be operated by the department of housing called

the "housing land bank."

     42-55.3-2. Establishment of account.

     The department of housing ("department") shall establish an account into which title to real

estate assets shall be deposited and held for use in the housing programs described in chapters 55.2

and 165 of this title.

     42-55.3-3. Acquisition of property and deposit into the land bank.

     (a) The department may acquire real property or interests in real property by gift, devise,

transfer, exchange, foreclosure, purchase, or otherwise on terms and conditions and in a manner

the department considers proper and deposit such property into the housing land bank ("land

bank").

     (b) The department may use its own funds or funds in the housing development fund

created pursuant to chapter 55.2 of this title to acquire real property by purchase contracts, lease

purchase agreements, installment sales contracts, and/or land contracts, and may accept transfers

from municipalities, other quasi-public entities, nonprofit entities or the state upon such terms and

conditions as agreed to by the department and the municipality, entity or state.

     (c) Notwithstanding any other law to the contrary, any municipality may freely transfer to

the land bank real property and interests in real property of the municipality on such terms and

conditions and according to such procedures as determined jointly by the municipality and the

department.

     (d) The acquisition of real property by the department pursuant to this section, from entities

other than political subdivisions, shall be limited to real property that is tax delinquent, tax

foreclosed, subject to municipal receivership, vacant or abandoned, or unimproved land; provided,

however, that the land bank shall have authority to enter into agreements to purchase other real

property consistent with an approved development plan in accordance with chapter 165 of this title.

     42-55.3-4. Public inspection of records.

     (a) The department shall maintain and make available for public review and inspection a

complete inventory of all property received by the department for deposit into the land bank. Such

inventory shall include: the location of the parcel; the purchase price, if any, for each parcel

received; the current value assigned to the property for purposes of real property taxation; the

LC002652 - Page 5 of 28

amount, if any, owed to the locality for real property taxation or as a payment in lieu of taxes; the

identity of the transferor; and any conditions or restrictions applicable to the property.

     (b) All parcels received by the department and deposited into the land bank shall be listed

on the received inventory established pursuant to subsection (a) of this section within one week of

acquisition and shall remain in such inventory for one week prior to disposition. Such inventory

shall be listed on a website for the department accessible to the public.

     42-55.3-5. Departmental authority to reject proposed transfers of property.

     The department is hereby allowed to reject any proposed transfer of any real estate asset

for any reason including, but not limited to, polluted, contaminated or problematic parcels which

would, in the judgment of the department, create a harm to the finances, operations or interests for

the land bank, the department or the state.

     42-55.3-6. Property in the land bank exempt from legal process.

     (a) Any land deposited into the land bank shall not be subject to attachment, execution or

any judicial or administrative process during the period it is held by the department, unless that

parcel or asset is pledged as security for any loan agreement made for funding improvements related

to that parcel in which case such process shall be available against that asset only, and no liens,

fines, penalties, assessments or other charges shall be made against the property, the land bank, the

department or the state for any reason during the period it is held in the land bank.

     (b) In the event there is a division in the freehold interest where only a portion of the rights

related to the property is located in the land bank, the remainder may be made subject to legal

process as long as such process does not act to divest the land bank of any of its attributes of

ownership or ability to develop the property.

     (c) In the event of a divided ownership where a portion of the fee or property interest is

held by the land bank or any other conflict in ownership which may arise under this section, the

department may petition the superior court for partition in which after the required notice and

service of process is completed upon confirmatory motion, the land bank shall be awarded and

receive the whole fee simple interest by way of an interim order or a final judgment. An interim

order or a final judgment constitutes a recordable order which shall be considered binding in the

chain of title and any of the remainder portion claimed by another owner or creditor shall be subject

to owelty under the law or in equity based on the value of the interest transferred to the land bank.

Neither the department nor any land subject to such a partition action shall be restrained nor

enjoined and no equitable order shall issue to prevent the development of the property by the

department or its applicant or assignee.

     42-55.3-7. Required review of surplus land by state and municipal entities.

LC002652 - Page 6 of 28

     (a) Conduct of required review. All state and municipal public bodies and quasi-public

entities shall conduct a review of real estate assets owned by or under the control of the body or

quasi-public entity and determine which real estate assets are not under current use or planned use

by December 31, 2023.

     (b) Real estate asset planning. Each state and municipal public body and quasi-public entity

shall create a long-term plan for those real estate assets not in current use. Such a plan shall provide

an estimated date when each real estate asset will be employed for use by the agency, what the

proposed use will be, and if known, the estimated costs to develop the land for the proposed use.

     (c) A list of all real estate assets which are not in use shall be submitted to the department

along with a list of those parcels for which there are plans to put said parcel to use within ten (10)

years and evidence of what that use will be.

     (d) The department will evaluate each parcel submitted to the department, along with the

proposed use for each parcel so denominated by each public body, for the appropriateness for

development into residential housing units. A copy of the list shall also be provided to the state

properties committee.

     (e) Notice to the department. If the department determines that a particular parcel listed on

any list required in subsections (b) and (c) of this section is determined to be appropriate for

residential real estate development, the department shall provide notice to the state or municipal

public body or quasi-public agency that is in control of or owns the parcel.

     (f) Required donation or sale to land bank. Upon a determination by the department that a

particular real estate asset listed pursuant to subsection (d) of this section is suitable for residential

real estate development and the department has determined that it desires to acquire the real estate

asset for the land bank, if said parcel is not listed as being planned for use within the next ten (10)

years, the state or municipal public body or quasi-public agency, as applicable, shall be required,

upon notice by the department, to enter into a negotiation with the department for the transfer of

the parcel to the land bank. If the department and the state or municipal public body or quasi-public

agency cannot agree on a transfer value, then establishment of a value through binding arbitration

by a panel comprising of three (3) licensed real estate appraisers licensed to appraise the particular

type of property at issue shall be required with one appointed by the department, one by the owner

of the parcel and one chosen by the two (2) appraisers. The middle appraisal shall be considered

the final purchase price subject to acceptance by the department. If the value is such that the

department desires to continue with the purchase, then the state or municipal public body or quasi-

public agency shall be required to consummate the sale.

     (g) Parcels exempt from the required donation or sale. The following real estate assets shall

LC002652 - Page 7 of 28

be exempt from the required sale procedure in subsection (f) of this section:

     (1) All real estate assets under the control of the Quonset development corporation within

the Quonset business park;

     (2) All real estate assets under the control of the Rhode Island airport corporation;

     (3) All real estate assets under the control of the department of transportation held for

proposed roads, highways, railways or other transportation infrastructure;

     (4) All real estate assets under the control of the Rhode Island public transit authority;

     (5) All real estate assets in the immediate vicinity of the state house and state offices in the

capitol district as bounded westerly by Interstate 95, southerly by Memorial Boulevard, northerly

by Orms Street and easterly (from north to south) by Charles Street then by Mill Street and then by

the Moshassuck River;

     (6) All real estate assets connected with judicial branch activities;

     (7) All real estate assets controlled by the department of corrections;

     (8) All real estate assets controlled by the university of Rhode Island;

     (9) All real estate assets controlled by Rhode Island college that are located in Providence;

     (10) All real estate assets located in Cranston at the John O. Pastore Center or in its

immediate vicinity;

     (11) All real estate assets controlled by the office of veterans' services in the vicinity of the

Rhode Island veterans' cemetery and the Rhode Island veterans' home;

     (12) All real estate assets related to Eleanor Slater Hospital including, but not limited to,

facilities in Cranston and Burrillville;

     (13) All assets located in a flood zone;

     (14) All assets located in a wetland designated by the department of environmental

management;

     (15) All assets located within the jurisdiction of the coastal resources management council;

     (16) All real estate assets which are subject to any farm, forest or open space restriction

against building through the department of environmental management, any agricultural

conservancy trust, or any not-for-profit entity or trust;

     (17) All state parks, conservation areas, management areas, beaches, fishing areas and

other sites subject to the management and/or control of the department of environmental

management;

     (18) All parcels designated by the director of the department of emergency management as

necessary for emergency preparation purposes;

     (19) All parcels abutting or adjacent to hospitals and healthcare facilities that are reserved

LC002652 - Page 8 of 28

for future expansion of the healthcare or hospital facility;

     (20) Real estate assets subject to the control or oversight of the I-195 redevelopment

commission;

     (21) Real estate assets owned, controlled or overseen by the Rhode Island historical

preservation & heritage commission; and

     (22) Any property being operated as a farm, for recreational purposes, open space, or as a

water supply or for the provision of utilities or serves as a buffer to any watershed, water supply or

utility.

     (h) Donation or sale prior to disposition. Prior to any disposition of any real estate asset by

any state or municipal public body or quasi-public agency through sale, long-term lease of more

than five (5) years, surplus of property, auction, donation or other method, notice shall be provided

to the department along with the opportunity to timely evaluate the property and decide whether to

exercise an option to purchase or decline to purchase the parcel which shall not be less than forty-

five (45) days. Notice of the proposed auction date, sale date or date of the disposition shall be

provided to the department. Unless a public auction or sale is required pursuant to other law or

judicial order, the department shall have the right of first refusal for purchase of the real estate asset

by the land bank at:

     (1) The advertised price, or, if none, then;

     (2) At the price offered by an alternative buyer, or, if none, then;

     (3) At the lowest price acceptable to the selling entity if acceptable to the department. The

department shall inform the selling agency of its decision to exercise its right of first refusal prior

to the auction date, sale date or disposition date contained in the original notice.

     SECTION 3. Title 42 of the General Laws entitled "STATE AFFAIRS AND

GOVERNMENT" is hereby amended by adding thereto the following chapter:

CHAPTER 165

DEPARTMENT OF HOUSING RESIDENTIAL DEVELOPMENT PROGRAMS

     42-165-1. Definitions.

     (a) As used in this chapter, words and terms, shall have the meaning set forth in § 42-55.2-

2 unless this chapter provides a different meaning or unless the context indicates a different

meaning or intent.

     (b) Within this chapter, the following words and terms shall have the following meanings

unless the context indicates a different meaning or intent:

     (1) "Department" means the department of housing established pursuant to § 42-64.34-1.

     (2) "Foreclosing governmental unit" means any municipality, water service, sewer provider

LC002652 - Page 9 of 28

with the power to sell a property through chapter 9 of title 44 or with the power to foreclose as well

as the "department."

     (3) "Housing structures" means a building or structure containing one or more "housing

units."

     (4) "Housing units" means a building or a portion of a building which is conveyed or rented

to a single family for their occupancy. Such units shall be separate from all other units in a structure

and contain separate rooms for each of the following purposes: at least one bathroom with a shower

and/or tub unit, one kitchen with a refrigerator, kitchen sink and cooking appliances, a living or

common family space, at least two (2) bedrooms, and a closed space for utilities and mechanicals

servicing the unit.

     (5) "Land bank" means housing land bank established in § 42-55.3-1.

     (6) "Secretary" means the secretary of housing appointed pursuant to § 42-64.34-1.

     (7) "State and municipal public bodies" means, the state, any city, any town and any

executive, legislative, judicial, regulatory, or administrative body of the state, or any political

subdivision thereof; including, but not limited to: any department, division, agency, commission,

board, office, bureau, authority; any school, fire, or water district, or other agency of Rhode Island

state or local government.

     42-165-2. Creation of programs.

     The department of housing is hereby authorized to create and establish programs for

promoting and encouraging the preservation, expansion and sound development of new and

existing residential housing units thereby increasing the housing security of the citizens of this state

in safe and affordable housing which shall also promote the economic development of the state by

ensuring safety for its workforce and families.

     42-165-3. General powers.

     (a) Except to the extent inconsistent with any specific provision of this chapter, the

department shall have and may exercise all general powers set forth in chapters 55.2, 55.3 and

64.34 of this title necessary or convenient to effect its purposes, which shall include the powers to

acquire and to dispose of real property, subject to the provisions of this chapter, without the

necessity of obtaining the approval of the state properties committee or otherwise complying with

the provisions of title 37 and to dispose of projects as provided for in § 42-64-11.

     (b) The department is further authorized:

     (1) To ask, demand, recover, collect, receive, hold, and possess all sums of money, debts,

dues, goods, wares, merchandise, chattels, effects, bonds, notes, checks, drafts, accounts, deposits,

safe deposit boxes, interests, dividends, stock certificates, certificates of deposit, insurance benefits

LC002652 - Page 10 of 28

and proceeds, documents of title, personal and real property, tangible and intangible property, and

property rights, liquidated or unliquidated, that now are, or hereafter, shall be, or become, due,

owing, or payable in respect to the property, and upon receipt thereof, or of any part thereof, to

make, sign, execute, and deliver such receipts, releases, or other discharges for the same as the

secretary shall deem proper and deliver the amounts required to the housing development fund

created by chapter 55.2 of this title.

     (2) To lease, purchase, exchange and acquire, and to bargain, contract, and agree for the

lease, purchase, exchange, and acquisition of, and to take, receive, possess, and manage any real or

personal property related in any way to the property, tangible and intangible, or any interest therein.

     (3) Subject to the right of any tenant under chapter 18 of title 34, to enter into and upon all

and each of the real properties constituting a part of, or related in any way, to the property, and to

let, manage, and improve the real property or any part thereof, and to repair or otherwise improve

or alter, and to insure any buildings or structures thereon.

     (4) Subject to the provisions of this chapter, to market and sell, either at public or private

sale, or exchange any part or parts of the real or personal properties, including indebtedness or

evidence thereof, constituting a part of or related in any way to the property, including sales on

credit, and for that purpose to execute and receive all promissory notes, bonds, mortgages, deeds

of trust, security agreements, and other instruments that may be necessary or proper, and to bargain,

contract, and agree with respect to the sale or exchange of such properties; and to execute and

deliver good and sufficient deeds, bills of sale, assignments, or other instruments or endorsements

for the conveyance or transfer of the same; and to give receipts for all or any part of the purchase

price or other consideration.

     (5) To sign, endorse, execute, acknowledge, deliver, receive, and possess such applications,

contracts, agreements, options, covenants, deeds, conveyances, trust deeds, mortgagees deeds,

security agreements, bills of sale, leases, mortgages, assignments, insurance policies, bills of lading,

warehouse receipts, documents of title, bills, bonds, debentures, checks, drafts, bills of exchange,

notes, stock certificates, proxies, warrants, commercial paper, receipts, withdrawal receipts, and

deposit instruments relating to accounts or deposits in, or certificates of deposit of, banks, savings

and loan or other institutions or associations, proofs of loss, evidences of debts, releases, and

satisfactions of mortgages, judgments, liens, security agreements, and other debts and obligations,

and other instruments in writing of whatever kind and nature as may be necessary or proper in the

exercise of the rights and powers herein granted.

     (6) To enter into subordination agreements, inter-creditor agreements, reinstatement

agreements, "stand still" and "stand-by" agreements, modification agreements, forbearance

LC002652 - Page 11 of 28

agreements, and other contracts having the effect of subordinating, modifying, renewing,

restructuring or otherwise altering the rights, obligations, or liabilities of the department or its

predecessors, under or with respect to any indebtedness, property, or other assets constituting or

securing any property.

     (7) To make demands, give notices of default, notices of intention to accelerate, notices of

acceleration, or such other notices as the department deems necessary or appropriate, and to take

other actions and exercise other rights that may be taken under the terms of any loan agreements,

security agreements, guaranties, or other documents or agreements evidencing, or otherwise

relating to, the property, including foreclosure, lease, sale, taking possession of, realization upon,

or any other disposition of any property or any collateral therefor or guarantee thereof.

     (8) To exercise any powers and any duties previously vested in the commerce corporation

or now vested in the department as a partner, joint venture, participant, or other joint-interest holder

with respect to any property, or to concur (or not) with persons jointly interested with the

department in any property.

     (9) With respect to the property:

     (i) To sue on, or otherwise prosecute, any claim or cause of action, or commence or seek

any legal, equitable, or administrative or other remedy in any legal, administrative, arbitration,

mediation, or other proceeding whatsoever (including, non-judicial repossessions and foreclosures

or similar actions to recover collateral);

     (ii) To defend, or otherwise participate for, or in the name of, the department in any legal,

administrative, arbitration, mediation, or other proceedings;

     (iii) To process, determine, or adjudge any claim or cause of action for, or in the name of,

the department;

     (iv) To compromise, settle, discharge or resolve, or make, execute, or deliver any

endorsements, acquittances, releases, receipts, or other discharges of any claim, cause of action,

determination, judgment, or other proceeding for, or in the name of, the department; and

     (v) To prepare, execute, and file ad valorem, franchise and other tax returns, protests and

suits against taxing authorities, and to prepare, execute, and file other governmental or quasi-

governmental reports, declarations, applications, requests and documents in connection with any

property, and to pay taxes in connection with the property as the department deems necessary or

appropriate, or as otherwise required by law.

     (10) To own, hold, improve, operate, manage, and regulate utilities for properties subject

to its control or ownership and to establish rates, fees, and charges, to adopt regulations, and to

impose penalties for any services or utilities it provides, or causes to have available, and to have

LC002652 - Page 12 of 28

functions and exercise powers as necessary and appropriate as the successor to the commerce

corporation under the provisions of §§ 42-64-4, 42-64-7.4, 42-64-7.8, 42-64-7.9 and 42-64-9.1

through 42-64-9.10, inclusive or under its own authority as granted by law.

     (11) Subject to the provisions of this chapter, to enter into agreements with any city, town,

district, or public corporation with regard to application and/or administration of zoning or other

land use ordinances, codes, plans, or regulations, and cities, towns, districts, and public

corporations are hereby authorized and empowered, notwithstanding any other law to the contrary,

to enter into such agreements with the department and to do all things necessary to carry out their

obligations under such agreements.

     (12) To be exempt from taxation for projects which have not been completed, to pay

twenty-five percent (25%) of the real estate taxes owed to a municipality for projects which have

been completed and where a housing unit is in the possession of the department, and to enter into

agreements for payments in lieu of taxes in the same manner as provided for in § 42-64-20. Any

payments in lieu of taxes for housing completed under this chapter with the assistance of funds or

property provided pursuant to chapter 55.2 and/or 55.3 of this title shall be exempt from the

calculation of the maximum tax rate and/or levy under § 44-5-2.

     (13) To purchase and obtain water supply and water service from any city, town, water

district, or other water supply authority. In particular, the department is authorized to:

     (i) Enter into agreements or contracts with any city, town, water district, or other water

supply authority to purchase, acquire, and receive water supply and water service.

     (ii) Enter into cooperative agreements with cities, towns, counties, water districts, or other

water supply authorities for the interconnection of facilities or for any other lawful corporate

purposes necessary or desirable to effect the purposes of this chapter.

     (iii) Connect the water supply system on any property or project controlled, approved,

owned or overseen by the department with any city, town, water district, or other water supply

authority that receives or has a connection with the city of Providence and/or the Providence water

supply board (or any successor thereof) and purchase, connect to, receive, and enter into agreements

to receive water supply from any city, town, water district, or other water supply authority

regardless of the origin of such water supply. The city of Providence and the Providence water

supply board (and any successor thereof) are authorized and directed to supply water to property,

projects and location as directed by the department either directly or via connections between the

property or project and any city, town, water district, or other water supply authority,

notwithstanding any terms to the contrary in any agreement, including, without limitation, any

agreement between any city, town, water district, or other water supply authority and the city of

LC002652 - Page 13 of 28

Providence and/or the Providence water supply board (or its or their predecessors), or the provisions

of chapter 16 of title 39. In addition, the provisions of § 18 of chapter 1278 of the public laws of

Rhode Island of 1915 as amended, and any other public law that would conflict with the terms

hereof, are hereby amended to authorize the provision of water supply by the city of Providence

and the Providence water supply board (or any successor thereof) to any property or project of the

department and to authorize any additional connections in accordance herewith. There shall be no

requirement that the department demonstrate public necessity before entering into such agreements,

connecting to such water supplies, or receiving such water as described in this section, but the

department shall be subject to the other applicable provisions of chapter 15 of title 46.

     (c) Any third party shall be entitled to rely on a writing signed by the secretary or in his or

her name to conclusively establish the identity of a particular property as property for all purposes

hereof.

     (d) The provisions of § 42-64-13(d) shall apply to land, real estate assets and projects

owned by or under the supervision of, the department or lawfully approved by the secretary.

     42-165-4. Development of new housing.

     (a) The department shall formulate a program for the development of new housing units

where a portion of the housing is set aside from projects to ensure affordability. The program shall

provide for housing to be developed using assets, including, but not limited to, funds and real estate

assets, held by the land bank established pursuant to § 42-55.3-1, the housing development fund

and other sources available to the department. The program shall solicit applications from

businesses, not-for-profit entities and developers for the construction of the housing units, or the

department may undertake the work of development by use of its staff and contracting with

businesses, individuals and entities for the completion of the work. The department sponsored

residential development program shall have general criteria that applies to the construction of all

housing units and housing structures as well as specific criteria that applies based on different

project sizes as further described in this chapter.

     (b) In addition to income restrictions, for projects which are administered by the

department for operation by the department, a public housing authority or other quasi-public entity

the criteria shall include caps on rental of any units to an amount based on percentage of income to

ensure affordability in a manner similar to the method calculation pursuant to Section 8 guidelines

pursuant to 42 U.S.C. § 1437f, § 3535(d) and 24 C.F.R. Part 982.

     42-165-5. Municipal sponsored residential development projects.

     (a) The department shall administer a municipal sponsored residential development project

program where the department is permitted to provide funding from the housing development fund

LC002652 - Page 14 of 28

and/or land from the land bank in support of the municipal residential development project which

is primarily built for affordable housing, workforce eligible housing or disability housing purposes

with appropriate dispositions and deed restrictions as provided in this chapter.

     (b) Municipal sponsored projects. For any project sponsored by a municipality an

application shall be presented to the department for funding or for the provision of land through the

land bank. Any funding shall be made contingent on completion of the project, the issuance of

certificates of occupancy and disposition to owners or lessees. No less than fifty percent (50%) of

the housing units shall be made available for affordable housing, and no less than seventy-five

percent (75%) shall be made available for affordable housing and workforce eligible housing in

any project. A lien shall exist on any real estate which is transferred from the department and all

improvements made thereon which shall be forgiven upon completion of the project and disposition

to an eligible owner. For any municipally sponsored project the municipality shall provide at least

ten percent (10%) of the funds or one hundred thousand dollars ($100,000), whichever is less, for

the funding of the project. The municipality's portion of the funding may be satisfied by grants,

contributions, donations or other sources and need not be derived from the municipality's general

revenues or general fund.

     42-165-6. Criteria for development projects.

     (a) The general criteria applying to the original construction of all new housing

developments sponsored by the department shall include the following:

     (1) Each housing structure shall have at least one housing unit. In structures with two (2)

or more housing units, the units shall be separately accessible from a common area or from the

outside and able to be locked by the occupants;

     (2) Each housing structure shall be constructed using similar materials of similar type,

grade, size, quantity and quality and appear to be relatively uniform except as to color of siding or

paint and any land characteristics specific to the parcel, whether divided or subdivided or not;

     (3) Each housing structure's internal features shall be relatively uniform as to the type,

grade, size, quantity and quality of materials, the number of rooms, and the size of rooms, except

that disability or accessible housing may have larger dimensions and a different design to

accommodate for the needs of the proposed occupants;

     (4) Construction shall comply with all applicable building codes;

     (5) Construction shall ensure sufficient utility service including, but not limited to:

     (i) Water by private wells of acceptable water quality, flow rate and quantity or public

water supply access;

     (ii) Sewer or sufficient treatment or septic facilities compliant with department of

LC002652 - Page 15 of 28

environmental management regulations and the law;

     (iii) Electric;

     (iv) Electric, natural gas connection, or oil or propane storage for each housing structure

with separate meters or tanks for each housing unit for the purpose of providing heat and hot water;

and

     (v) Broadband or higher Internet connectivity;

     (6) Housing structures shall be built to be energy efficient, with such further requirements

as determined by the secretary in consultation with the state building code commission and the

office of energy resources including consideration of the requirements of 42 U.S.C. § 12709;

     (7) Located, when possible, near existing public transportation; and

     (8) Shall be constructed in a manner where the housing structures are built to look similar

to other existing structures present in the community or municipality where the project is located.

     (9) The prevailing wage requirements of chapter 13 of title 37 shall apply to all projects:

     (i) funded with monies or in-kind contributions provided by or through the department of

housing;

     (ii) Developed under a program created or administered by the department of housing;

     (iii) Any project otherwise overseen by the department of housing.

     (10) All projects will be subject to liens in favor of the department of housing until

disposition to ensure conformity with the requirements of this chapter and such regulations as are

promulgated by the department of housing.

     (b) Specific criteria for housing developments sponsored by the department dependent on

project size are as follows:

     (1) Developments of ten (10) or more housing structures. In all projects where there are ten

(10) or more housing structures the following criteria shall be required:

     (i) At least one unit for each ten (10) structures shall be designed and constructed to be

fully handicapped accessible in all areas of the housing unit;

     (ii) Fifty percent (50%) of the housing units shall be designated as affordable housing units;

     (iii) Seventy-five percent (75%) of the housing units shall be designated as either workforce

eligible housing or affordable housing;

     (iv) The remaining housing units shall be eligible to be sold at full market rates;

     (v) An area of the development shall be reserved for recreational space sufficient in size

and location to be accessible by the whole development and useful to the residents therein;

     (vi) For the development of real estate parcels equal to or larger than ten (10) acres before

any division or subdivision thereof, twenty-five percent (25%) of the parcel shall be held for open

LC002652 - Page 16 of 28

or forest space; and

     (vii) Any other additional criteria that the department shall deem appropriate for the

purposes of this chapter and the program.

     (2) Developments of five (5) to nine (9) housing structures. In all projects where there are

five (5) to nine (9), inclusive, housing structures:

     (i) At least one housing unit shall be designed and constructed to be fully handicapped

accessible in all areas of the housing unit;

     (ii) Thirty percent (30%) of the housing units shall be designated as affordable housing

units;

     (iii) Fifty percent (50%) of the housing units shall be designated as workforce eligible

housing or affordable housing;

     (iv) The remaining housing units shall be eligible to be sold at full market rates; and

     (v) Any other additional criteria that the department shall deem appropriate for the purposes

of this chapter and the program.

     (3) Developments of one to four (4) housing structures. In all projects where there are one

to four (4), inclusive, housing structures:

     (i) Fifty percent (50%) of the housing units shall be designated as affordable housing units;

     (ii) Sixty percent (60%) of the housing units shall be designated as workforce eligible

housing or affordable housing;

     (iii) The remaining housing units shall be eligible to be sold at full market rates; and

     (iv) Any other additional criteria that the department shall deem appropriate for the

purposes of this chapter and the program.

     42-165-7. Authorization to develop additional criteria for projects.

     In developing the program and any regulations, additional criteria or bylaws that the

department may adopt, the secretary shall seek input from the building and trade industry

representatives, pertinent not-for-profit entities, municipalities, other state agencies and the public.

     42-165-8. Protecting and improving existing multifamily housing.

     (a) The department shall administer a program for the production and ownership of new or

rehabilitated multifamily housing in partnership with local public housing authorities and other

public agencies, including, but not limited to, redevelopment agencies and economic development

agencies. The department may provide low interest or no-interest loans, forgivable loans, gap

funding, or any combination of the above to such public agencies for the construction or

rehabilitation of mixed-income multifamily housing. The department may purchase multifamily

residence units, provide low interest or no-interest loans, forgivable loans, gap funding, or any

LC002652 - Page 17 of 28

combination of the above to owners of multifamily units, builders, not-for-profit corporations and

developers to ensure that multifamily housing units are not closed or lost.

     (b) No portion of the program shall be used for payment of rent of occupied units or

purchase mortgage relief for owners. In formulating policies for this program, the department shall

work with public housing authorities, the Rhode Island housing and mortgage finance corporation,

not-for-profits and other businesses, entities and individuals to coordinate resources and ensure

both that there is a remedy when no other remedy exists and that there is as little financial and

administrative duplication as possible.

     (c) The department shall also operate the program in such a manner that it will act as a

clearinghouse or "one-stop-shop" for information for owners, investors, occupants and residents

for the protection and improvement of existing multifamily housing units.

     42-165-9. Rehabilitation of closed and endangered multifamily housing.

     (a) The department shall administer a program for the rehabilitation of multifamily housing

that is no longer rented to tenants and to rehabilitate multifamily units that are endangered of being

lost from the market.

     (b) The department may purchase multifamily residence units, provide low interest or no-

interest loans, forgivable loans, gap funding, or any combination of them to builders, not-for-profit

corporations and developers and owners of multifamily units to ensure that previously operational,

but currently closed multifamily housing units, are brought back to the market and that endangered

multifamily housing units are not closed or lost. Endangered multifamily units may include, but

not be limited to, properties in receivership, properties in bankruptcy, properties in foreclosure,

properties in tax sale, properties with building code violations, properties with fire code violations,

properties with municipal code violations, properties with zoning violations, properties with lead

paint hazards, properties in high market rent areas where consolidation of multiple units into a

single unit are threatened, units where portions of the unit have been previously and lawfully rented

as separate units, and other properties as determined by the department. In formulating policies for

this program, the department shall work with public housing authorities, the Rhode Island housing

and mortgage finance corporation, not-for-profits and other businesses, entities and individuals to

coordinate resources and ensure both that there is a remedy when no other remedy exists and that

there is as little financial and administrative duplication as possible. The department shall also

operate the program in such a manner that it will act as a clearinghouse or "one-stop-shop" for

information for owners, investors, occupants and residents for the protection and improvement of

existing multifamily housing units.

     42-165-10. Municipal incentives for housing development.

LC002652 - Page 18 of 28

     (a) Municipalities are encouraged to approve and sponsor affordable housing and

workforce eligible housing development. For municipalities that approve and sponsor such projects

the following adjustments to their municipal and education aid shall be made:

     (1) For projects approved by the municipality and the department after the effective date

of this chapter, but before July 1, 2024, education aid shall be increased to the local education

authority on a per capita basis for each additional student enrolled in public schools in an amount

equal to the district's per pupil cost multiplied by one hundred percent (100%) for each additional

child living in such housing for a period of five (5) years and a bonus of one-half (1/2) of the

increase shall be provided to the municipality in which the student's residence in the new housing

unit is located for a period of five (5) years. In the event a student who moves into housing

developed under this chapter requires special education services, the department of education shall

pay for ninety percent (90%) of the student's additional services each year above the per pupil cost

for the period the student remains in the housing unit or remains as a student in the district,

whichever is less.

     (2) For projects approved by the municipality and the department on or after July 1, 2024,

but before January 1, 2025, education aid shall be increased to the local education authority on a

per capita basis for each additional student enrolled in public schools in an amount equal to the

district's per pupil cost multiplied by seventy-five percent (75%) for each additional child living in

such housing for a period of five (5) years and a bonus of one-half (1/2) of the increase shall be

provided to the municipality in which the student's residence in the new housing unit is located for

a period of five (5) years. In the event a student who moves into housing developed under this

section requires special education services, the department of education shall pay for seventy-five

percent (75%) of the student's additional services each year above the per pupil cost for the period

the student remains in the housing unit or remains as a student in the district, whichever is less.

     (3) For projects approved by the municipality and the department on or after January 1,

2025, but before July 1, 2025, education aid shall be increased to the local education authority on

a per capita basis for each additional student enrolled in public schools in an amount equal to the

district's per pupil cost multiplied by fifty percent (50%) for each additional child living in such

housing for a period of five (5) years and a bonus of one-half (1/2) of the increase shall be provided

to the municipality in which the student's residence in the new housing unit is located for a period

of five (5) years. In the event a student who moves into housing developed under this section

requires special education services, the department of education shall pay for fifty percent (50%)

of the student's additional services each year above the per pupil cost for the period the student

remains in the housing unit or remains as a student in the district, whichever is less.

LC002652 - Page 19 of 28

     (4) For projects approved by the municipality and the department on or after July 1, 2025,

but before July 1, 2026, education aid shall be increased to the local education authority on a per

capita basis for each additional student enrolled in public schools in an amount equal to the district's

per pupil cost multiplied by twenty-five percent (25%) for each additional child living in such

housing for a period of three (3) years and a bonus of one-half (1/2) of the increase shall be provided

to the municipality in which the student's residence in the new housing unit is located for a period

of five (5) years. In the event a student who moves into housing developed under this section

requires special education services, the department of education shall pay for twenty-five percent

(25%) of the student's additional services each year above the per pupil cost for the period the

student remains in the housing unit or remains as a student in the district, whichever is less.

     (5) For projects approved on or after July 1, 2026, no bonus municipal aid or education aid

shall be awarded under this section.

     (b) The education aid calculations made in subsection (a) of this section shall be adjusted

based on the municipality's attainment of the goals set out in chapter 53 of title 45. When any

municipally approved project increases the number of affordable housing units, the projected total

upon completion shall be used to determine the aid in this section. The calculation of the aid

adjustment shall be made irrespective of whether the municipality has been deemed to have a

feasibility condition or exemption from percentage of affordable housing set out in chapter 53 of

title 45 (low and moderate income housing). Education aid increases set out in this section shall be

adjusted as follows:

     (1) For projects approved prior to July 1, 2024, no adjustment shall be made.

     (2) For projects approved on or after July 1, 2024, municipalities shall have their increase

reduced by the ratio of the difference between ten percent (10%) and the projected amount attained

after completion of all approved projects divided by the ten percent (10%) requirement. In no event

shall the amount be reduced below fifty percent (50%) of the increase that would have been

awarded had no reduction been made pursuant to this subsection.

     (c) The general assembly shall ensure that the bonus aid provisions contained within this

section are appropriated for each year in which the incentives are awarded.

     42-165-11. Enforcement of minimum affordable housing standards.

     (a) Beginning July 1, 2026, in any city or town where the benchmark for affordable housing

set forth in chapter 53 of title 45 (low and moderate income housing) has not been satisfied,

irrespective of any determination of infeasibility or exemption from the ten percent (10%) threshold

for affordable housing, affordable housing planned development units to be constructed pursuant

to chapter 53 of title 45 shall not need approval of the municipality, notwithstanding any municipal

LC002652 - Page 20 of 28

law or other statute to the contrary, but instead shall be required to seek approval solely from the

department.

     (b) With regard to an affordable housing development undertaken by the department or by

an applicant who applies to the department for project approval pursuant to subsection (a) of this

section, the department shall require that the project comply with municipal laws in effect in the

municipality where the project is located, except the project does not need to comply with any

comprehensive plan, any restrictions on building, any restrictions on the use or planned use

infrastructure or other restrictions inhibiting development and such restrictions shall not be valid

as against projects approved by the department. Further, the following requirements authorized as

standard provisions that may be imposed under a municipal zoning law or other municipal

ordinance shall not apply to any project approved by the department:

     (1) The dimensions, size, lot coverage, floor area ratios, and layout of lots or development

areas;

     (2) The density and intensity of use; and

     (3) Any other requirement imposed pursuant to § 45-24-33(a)(4)(x).

     (c) For any project proposed, approved or undertaken under this section, the provisions of

§ 42-165-6 shall apply and if less than five (5) units are being produced, then that at least fifty

percent (50%) of the units shall be reserved for affordable housing units and twenty-five (25%)

percent shall be reserved for workforce eligible housing units and if less than five (5) units are

being produced, all of the units shall be reserved for affordable housing units.

     (d) Any appeal of an approval or denial by the department of any project under this section

shall be made to the superior court within thirty (30) days of the approval or denial being mailed to

the applicant in writing and be given priority on the trial calendar. Upon review, the superior court

shall determine whether the secretary or the department abused its discretion and if not, the appeal

shall be denied. The question on appeal shall be treated as a matter of law that may be resolved by

summary judgment. In the event the applicant is allowed to proceed, the applicant as a prevailing

party is entitled to costs, attorneys' fees and costs of litigation from any party that caused the appeal

to be brought to the superior court, along with an award of all interest charges incurred due to a

delay in the project.

     (e) Neither a municipality nor an abutter shall have any rights to appeal a decision of the

department. The sole remedy of an abutter shall be an action at law for any direct damages to their

property or for personal injuries.

     (f) Beginning on the effective date of this chapter:

     (1) Whenever any municipality lacks the resources, personnel or ability to approve a

LC002652 - Page 21 of 28

project, provide a certificate, or make an inspection, any aspect of a project or any other matter

related to a project that has been approved by the department, the municipality shall notify the

department in writing within three (3) business days. Upon notification, the department may

provide personnel to undertake the inspection or work on the approval of any project it has approved

and such inspection or approval work shall be deemed to be an approval by the municipality.

     (2) Any failure by a municipality to act on a request by an applicant of a project approved

by the department or by the department for an approval, certificate, inspection or other matter

within thirty (30) days shall be deemed to constitute an inability to undertake the necessary work.

After the expiration of thirty (30) days, the department shall make a written determination of such

inability and provide a copy of the determination to the municipality. After providing the notice to

the municipality, the department may provide the staffing to make the necessary determination that

is impeding the progress of the department within thirty (30) days and such an approval shall be

deemed to be an approval by the municipality.

     42-165-12. Coordination with Rhode Island infrastructure bank.

     (a) The department shall act in coordination with the Rhode Island infrastructure bank to

ensure the availability of resources to ensure the success of applicants and of the expansion of

housing units through development.

     (b) The department is authorized to act as a clearing house for information and as a point

of contact for applicants and others to achieve help from the Rhode Island infrastructure bank on

eligible projects where funding, assistance and expertise may be available from the Rhode Island

infrastructure bank.

     42-165-13. Coordination with other state agencies and quasi-publics.

     (a) The department shall act in coordination with all other state agencies, quasi-publics,

and municipalities, who in turn are hereby required to assist and consult with the department to

ensure the availability of resources and information to ensure the success of applicants and of the

expansion of housing units through development.

     (b) The department is authorized to act as a clearing house for information and as a point

of contact for applicants and others to achieve help from other state and local public bodies and

quasi-publics where funding, assistance and expertise may be available from said state and local

public bodies and quasi-publics.

     (c) The department is further authorized to coordinate with federal, state and municipal

agencies and not-for-profit organizations to provide "wrap around services" to occupants of

housing units completed.

     42-165-14. Restrictions on dispositions of projects and housing units by the

LC002652 - Page 22 of 28

department and/or the land bank.

     (a) Upon approval of any project, the department shall have a lien against the property on

which the project is located which shall be discharged upon the completion of the project and proper

sale in accordance with this chapter. In the event that the project is not completed and the

department determines that the project cannot be completed by the party in charge of the

development, the department shall have the right to foreclose on the lien through a non-judicial

foreclosure, take a deed-in-lieu of foreclosure or otherwise resort to the remedies existing in law

and equity of a first-position secured creditor.

     (b) Upon completion of a project, residential housing units may only be sold to individuals

who are first-time homebuyers for owner-occupied housing.

     (c) Any housing approved by the department, whether built or operated by any public

agency or any nonprofit organization or by any limited equity housing cooperative or any private

developer, that is developed under any program administered by the department shall contain a

deed restriction that requires that the housing unit remain owner-occupied and not rented and that

any resale requires that the new purchaser shall be a first-time homebuyer in the same category the

seller was when the seller purchased the structure (i.e. affordable housing, workforce eligible

housing, or market price housing). The deed restriction shall be enforceable by the department for

ninety-nine (99) years from the original grant or such other period that is either agreed to by the

applicant who originally develops the project and the department; provided, however, that period

is not less than thirty (30) years from initial occupancy. Any violation of the deed restriction results

in a reversion of the unit to the department for sale to another person qualifying under this chapter.

     (d) In the event of the death of an owner of a housing unit produced under a program

administered by the department and still subject to the deed restriction described in this section

then a family member or next of kin shall be entitled to inherit the housing unit as long as they

occupy the housing unit within nine (9) months of the date of death of the decedent irrespective of

their income level and thereafter, the housing unit remains owner-occupied by the heir, family

member or next of kin. In the event the heir, family-member or next-of-kin does not occupy the

housing unit within nine (9) months, the department shall purchase the housing unit at fair market

value and pay the money to the estate of the decedent. Upon purchase by the department, the

housing unit shall be resold by the department as if it were the first sale after development and the

unit shall remain in the same category for sale (i.e. affordable housing, workforce related housing,

market rate housing) as the housing unit was designated by the developer with a new deed

restriction period in the subsequent sale.

     (e) Not-for-profit entities or agencies whose mission is to provide affordable, low cost, or

LC002652 - Page 23 of 28

workforce eligible housing for rent. Upon the sale, a deed restriction shall be in place enforceable

by the department that requires units to be rented solely to individuals and/or families for primary

housing in eligible categories (i.e. affordable housing, low cost, or workforce eligible housing).

Such a restriction shall be perpetual or for the life of the entity granted the property. After the entity

is provided notice of the violation by the department and being provided a reasonable opportunity

to cure, any violation of the deed restriction results in a reversion of the parcel with all

improvements upon which the housing structure or housing unit in violation is located.

     42-165-15. Reporting.

     The department shall submit to the governor, the president of the senate, and the speaker

of the house, within six (6) months after the close of its fiscal year, a complete and detailed report

setting forth:

     (1) Its operations and accomplishments;

     (2) Its receipts and expenditures during the fiscal year in accordance with the categories

and classifications established by the department for its operating and capital outlay purposes

including a listing of all private consultants engaged by the department on a contract basis and a

statement of the total amount paid to each private consultant;

     (3) Its assets and liabilities at the end of its fiscal year including a schedule of its leases and

mortgages and the status of the reserve, special or other funds;

     (4) Its strategic plan and operating plan for the current fiscal year and proposed for the next

fiscal year;

     (5) A general statement of needs and opportunities relevant to its purposes; and

     (6) A listing of all fees paid to attorneys during the fiscal year. The report required by

subsections (2) and (3) of this section shall be prepared by independent certified public accountants

in accordance with generally accepted principles of accounting.

     42-165-16. Compliance with chapter 18 of title 34 required.

     The owner of any housing unit, completed with assistance or resources provided by the

housing development fund, the land bank, or programs established under this chapter, where a

completed housing unit is to be rented to a qualified individual or family shall be subject to and

shall comply with the provisions of chapter 18 of title 34 ("residential landlord and tenant act").

     42-165-17. Inconsistent provisions.

     Insofar as the provisions of this chapter are inconsistent with the provisions of any other

law or ordinance, general, special or local, the provisions of this chapter shall be controlling.

     42-165-18. Construction.

     This chapter, being necessary for the welfare of the state and its inhabitants, shall be

LC002652 - Page 24 of 28

liberally construed in order to effectuate its purposes.

     42-165-19. Severability.

     If any clause, sentence, paragraph, section, or part of this chapter shall be adjudged by any

court of competent jurisdiction to be invalid, that judgment shall not affect, impair, or invalidate

the remainder of the chapter but shall be confined in its operation to the clause, sentence, paragraph,

section, or part directly involved in the controversy in which that judgment shall have been

rendered.

     SECTION 4. Section 42-64-11 of the General Laws in Chapter 42-64 entitled "Rhode

Island Commerce Corporation" is hereby amended to read as follows:

     42-64-11. Disposition of projects.

     (a) Notwithstanding the provisions of any other law, the Rhode Island commerce

corporation may sell or lease to any person, firm, partnership, or corporation, or to any local

redevelopment agency, or to any state or federal agency or instrumentality, or to any municipality

or political subdivision of the state empowered to enter into the sale or lease, any project without

public bidding or public sale, for consideration and upon terms as may be agreed upon between the

corporation and the purchaser or lessee; provided that in the case of a lease, the term shall not

exceed ninety-nine (99) years. The sale or lease or agreement may be consummated as entered into

prior to, at the date of, or subsequent to the acquisition of completion of the project. Where a

contract of sale or lease is entered into prior to the completion of construction of the project to be

conveyed or leased, the corporation may complete the project prior or subsequent to the

consummation of the sale or lease.

     (b) In connection with the corporation’s disposition by sale, lease, or otherwise of any of

its projects, the corporation is authorized to require that the party acquiring the project, or any

interest therein or any right to use or occupy the project, may not sell, assign, convey, lease,

sublease, or otherwise dispose of, in whole or in part, its interest in the project or its right to use

and occupy the project without the approval, in writing, of the corporation. The corporation may

not unreasonably withhold that approval; and shall state the reason or reasons upon which that

withholding of approval is based. In determining whether to grant or withhold that approval, the

corporation shall consider whether the proposed disposition will further the purposes of this chapter

and may consider any and all other relevant factors as well.

     (c) The provisions of subsection (b) shall not be deemed to limit in any manner the

corporation’s authority in connection with the disposition by sale, lease, or otherwise of any of its

projects or to impose those terms and conditions permitted by law with respect to those dispositions

as it shall determine to be desirable.

LC002652 - Page 25 of 28

     (d) The corporation shall dispose, by sale, lease, transfer or other agreement, of projects on

or related to former Navy lands in the town of North Kingstown through the Quonset Development

Corporation as provided for in chapter 64.10 of this title and may dispose, by sale, lease, transfer

or other agreement, of other projects related to land and real estate development, regardless of

location in Rhode Island, through the Quonset Development Corporation as may be mutually

agreeable to the corporation and the Quonset Development Corporation.

     (e) The corporation may dispose, by sale, lease, transfer or other agreement, of projects

related to land and real estate development, regardless of location in Rhode Island, to the housing

department as may be mutually agreeable to the corporation and the secretary of housing.

     SECTION 5. Section 37-6-6 of the General Laws in Chapter 37-6 entitled "Acquisition of

Land" is hereby amended to read as follows:

     37-6-6. Notice to Rhode Island economic development corporation of proposed

acquisition or disposal.

     Before acquiring and before disposing of any land or other real property or any interest,

estate, or right therein, by conveyance, grant, lease, or license, except by license terminable by will,

the acquiring authority shall give written notice of its contemplated or proposed action to the Rhode

Island economic development corporation department of housing and afford the corporation

department of housing a reasonable opportunity to study and make its recommendations thereon.

     SECTION 6. Section 45-24-28 of the General Laws in Chapter 45-24 entitled "Zoning

Ordinances" is hereby amended to read as follows:

     45-24-28. Continuation of ordinances — Supercession — Relation to other statutes.

     (a) Any zoning ordinance or amendment of the ordinance enacted after January 1, 1992,

shall conform to the provisions of this chapter. All lawfully adopted zoning ordinances shall be

brought into conformance with this chapter by December 31, 1994. Each city and town shall review

its zoning ordinance and make amendments or revisions that are necessary to bring it into

conformance with this chapter.

     (b) All zoning ordinances adopted under authority of §§ 45-24-1 through 45-24-26 or any

special zoning enabling act that is in effect on June 17, 1991, shall remain in full force and effect

until December 31, 1994, unless earlier amended so as to conform to the provisions of this chapter,

except that § 45-24-37 and § 45-24-44 shall become effective on January 1, 1992.

     (c) Former §§ 45-24-1 through 45-24-26 and all special zoning enabling acts, including,

but not limited to, chapter 2299 of the public laws of 1922, as amended (town of Westerly); chapter

1277 of the public laws of 1926, as amended (town of Narragansett); chapter 2065 of the public

laws of 1933, as amended (town of West Warwick); chapter 2233 of the public laws of 1935, as

LC002652 - Page 26 of 28

amended (town of Johnston); chapter 2079 of the public laws of 1948, as amended (town of North

Kingstown); chapter 3125 of the public laws of 1953, as amended (town of New Shoreham);

chapter 101 of the public laws of 1973, as amended (town of South Kingstown); are repealed

effective December 31, 1994. All provisions of zoning ordinances adopted under authority of the

provisions of former §§ 45-24-1 through 45-24-26 or of any special act are repealed and are null

and void as of December 31, 1994, unless amended so as to conform to the provisions of this

chapter.

     (d) Chapter 24.1 of this title, entitled “Historical Area Zoning”, and chapter 3 of title 1,

entitled “Airport Zoning”, are not superseded by this chapter; provided, that any appeal to the

superior court pursuant to chapter 24.1 of this title, entitled “Historical Area Zoning”, or pursuant

to chapter 3 of title 1, entitled “Airport Zoning”, is taken in the manner provided in § 45-24-69.

     (e) Nothing in this chapter shall be construed to limit the authority of agencies of state

government to perform any regulatory responsibilities.

     (f) Nothing in this chapter shall be construed to supersede or interfere with development

undertaken by the housing department or its programs in accordance with chapters 55.2, 55.3 and/or

165 of title 42.

     SECTION 7. This act shall take effect upon passage.

========

LC002652

========

LC002652 - Page 27 of 28

EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- HOUSING DEVELOPMENT

FUND

***

     This act would create funding of affordable housing programs within the department of

housing. The act would also create a land bank program as well as residential development

programs for the construction of low-income housing units by the department and the cities and

towns.

     This act would take effect upon passage.

========

LC002652

========

LC002652 - Page 28 of 28