Page:United States Statutes at Large Volume 79.djvu/528

 488

PUBLIC LAW 89-117-AUGUST 10, 1965

[79 STAT.

P U R C H A S E OF U N I T S BY T E N A N T S

50 Stat. 895.^

SEC. 507. (a) SectioH 15 of the United States Housing Act is amended by adding after paragraph (8) a new paragraph as follows: "(9) Notwithstanding any other provision of this Act, but subject to the provisions of any contract with the Authority, any public housing agency may permit any member of a tenant family to enter into a contract (either individually or as a member of a group) for the acquisition of a dwelling unit in any project of the public housing agency which is suitable by reason of its detached or semidetached construction for sale and for occupancy by such purchaser or a member or members of his family, upon the following terms: " (A) The purchaser shall pay at least (i) a pro rata share cost of any services furnished him by the public agency, including but not limited to, administration, maintenance, repairs, utilities, insurance, l)rovision of reserves, and other expenses, (ii) local taxes on his dwelling unit, and (iii) monthly payments of interest and principal sufficient to amortize a sales price, equal to the greater of the unamortized debt or the appraised value (at the time such purchase contract is entered into) of the dwelling unit, in not more than forty years: Provided, That the public housing agency may, under terms and conditions to be prescribed by it, permit a purchaser to apply an amount equal to the net rent paid for his dwelling unit, over a period not exceeding three years prior to the entering into of any such contract, toward the purchase price of such unit; " (B) The interest rate shall be fixed at not less than the average interest cost of loans outstanding on the project, except that in the case of a project on which bonds are not outstanding the interest rate shall be fixed at not less tlian the going Federal rate applicable to such project; " (C) The principal payments shall be not less than one-half of 1 per centum per annum of the sales price during the first five years after purchase, 1 per centum per annum during the next five years, 11/^ per centum per annum during the third five years, and thereafter not less than the principal payments resulting from a level debt service of interest and principal over the balance of the payment period; and " (D) If at any time (i) a purchaser fails to carry out his contract with the public housing agency and if no member of his family who resides in the dwelling assumes such contract, or (ii) the purchaser or a member of his family who assumes the contract does not reside in the dwelling, the public housing agency shall have an option to acquire his interest under such contract upon payment to him or his estate of an amount equal to his aggregate principal payments plus the value to the public housing agency of any improvements made by him, less an amount equal to 21^ per centum of the sales price." (b) Such Act is further amended— (1) by inserting in the parenthetical phrase in section 10(h) after the words "exclusive of" the following: "any part thereof covered by a contract or conveyed pursuant to paragraph (9) of section 15, and exclusive of"; (2) by inserting after "may be made" in section 10(1) the following: ", subject to any outstanding contracts made pursuant to paragraph (9) of section 15,"; (3) by inserting after "acquisition", the first place it appears in paragraphs (1), (2), and (3) of section 15, the following:" (except pursuant to paragraph (9) of section 15)"; and

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