2. While there is typically a lot of attention paid
to 40B developments as they are being
proposed approved, and built, once they are
occupied it is less clear who does what.
While there is typically a lot of
attention paid to 40B
developments as they are
being proposed approved and
built, once they are occupied
it is less clear who does what.
2
3. What is the Post Occupancy Period?
Initial Phase:
Project Substantially Complete
Cost Examination and Certification Complete
Long-Term:
As long as deed-restricted, affordable units
remain in place
4. Who are the Players ?
Initial Phase only:
The Developer
The Subsidizing Agency
Initial Phase and Long-Term:
The Monitoring Agent
Residents of Affordable Units
The Municipality
The Condo Association, HOA or
Management Company
5. What are the Rules?
M.G.L. Chapter 40B
760 CMR 56.00
DHCD’s Comprehensive Permit Guidelines
6. What are the Rules?
Participant Guiding Documents
Developer Regulatory Agreement
Subsidizing Agency Regulatory Agreement
Monitoring Agent Regulatory Agreement
Monitoring Services Agreement
Affordable Housing Restriction (Deed Rider)
Affordable Unit Occupants Affordable Housing Restriction
Lease
Condo/HOA
Management Company
Condominium Documents
Massachusetts Condominium Law
Homeowner’s Association By-Laws
Management Company Policies
Municipality Building Code, City/Town Regulations and By-
Laws
7. Subsidizing Agency
Subsidizing Agency and Developer are identified in the Regulatory
Agreement.
• DHCD (LIP)
• MassHousing
• Mass Housing Partnership (MHP)
• Mass Development
• FHLBB (Bank is the Subsidizing Agency)
8. Post Occupancy Responsibilities:
Subsidizing Agency
Limited Dividend Requirement
• Limits Developer profits on 40B Developments
• Process starts 90 days after “substantial completion”
• Involves Cost Examination and Cost Certification Process
Process is different for homeownership and rental projects.
9. Post Occupancy Responsibilities:
Subsidizing Agency
Affordability Requirement
• Affirmative Fair Housing and Marketing
• 25% of the units are affordable
• Affordable units have eligible occupants
• Long Term Affordability Restriction in place
10. Term of Regulatory Agreement:
Homeownership 40B
“Initial Occupancy”
• All Affordable Units are occupied by eligible owners
• All Affordable Units secured with Long Term Affordability
Restriction
• Affordability Monitoring Services Agreement has been
put into place
11. Term of Regulatory Agreement
Rental 40B
Defined Term (Typically 30 Years)
Annual Limited Dividend Certification
Annual Income Certification
Allows for appointment of successor to continue
enforcement of Affordability Requirement
12. Post-Occupancy Responsibilities:
Affordability Monitoring Agent
Subsidizing Agency and Developer are identified in the Regulatory
Agreement and Monitoring Services Agreement (if there is one).
Rental 40B: Subsidizing Agencies=Monitoring Agent
Homeownership 40B:
• DHCD is the Monitoring Agent for all LIP Projects
• MassHousing uses a network of 3rd-party agents (CHAPA, RHSO.
etc.)
13. Post-Occupancy Responsibilities:
Affordability Monitoring Agent
Homeownership 40B- Initial Sales
Review the Affirmative Fair Housing Marketing Plan (AFHMP) – Identify necessary
revisions and/or corrections. Recommend approval or disapproval to MassHousing;
Monitor Initial Sales – Work closely with the Developer and/or their Lottery Agent to
ensure that Affordable Units included in a 40B Project are sold to Income Eligible
Households and are subject to a long-term Affordable Housing Restriction;
Compliance-Determine substantive compliance with Affordability Requirement
14. Post-Occupancy Responsibilities:
Affordability Monitoring Agent
Homeownership-Supplemental Monitoring Services
Monitor Resales - Ensure that all Resales (including those resulting from foreclosures)
comply with 40B regulations, the terms of the Affordable Housing Restriction; and the
AFHMP;
Annual Reporting - Prepare and submit an Annual Compliance Report to the Subsidizing
Agency and the Municipality regarding compliance of the Project with the Affordability
Requirement;
Supplemental Monitoring Services - Ensure ongoing compliance by Affordable Unit owners
with Chapter 40B and the terms of the Affordable Housing Restriction, including requests
for refinancing, capital improvements, leasing and resale.
17. Post-Occupancy Responsibilities:
Affordable Unit Tenant
-Notify management company of change in
status
• Income
• Household Size
• Occupancy
-Respond to requests for annual recertification
information
18. Role of Condominium Association
-Enforce Rules of Condominium Association
-Comply with Massachusetts Condominium Law
Note:
Condominium Fees and schedule of beneficial interest are
established and reviewed by Subsidizing Agency to ensure
affordability at initial sale. Changes to condo documents/condo
fees are not regulated by Monitoring Agent or Subsidizing Agency.
19. Post Occupancy Responsibilities:
Municipality
Normal and Routine Regulations and Services:
• Building Code
• Health/Safety Regulations
• State Wetlands Protection Act
• Town By-Laws (noise, leash laws, parking)
• Affordable units assessed at “affordable” prices
20. Post Occupancy Responsibilities:
Municipality
40B Homeownership Projects:
-Municipality is notified of pending Resales and is eligible to
purchase Affordable Units for resale through “Municipal
Option”
-Municipality is notified of pending Foreclosures and is
eligible to purchase Affordable Units for resale through
“Municipal Option”
21. Post Occupancy Responsibilities:
Municipality
40B Rental Projects:
-Plan for ongoing affordability at the end of the Term of the
Regulatory Agreement (typically 30 years) in accordance with the
provisions in the Comprehensive Permit.
22. Contact Info:
Katharine Lacy, AICP
MassHousing
1 Beacon Street
Boston, MA 02108
1-617-854-1098
klacy@masshousing.com
