Relating to the establishment of a disaster recovery homeowner assistance program and fund administered by the Iowa finance authority, transfers of moneys to certain funds, and including effective date provisions

Moneys in the fund at the end of each fiscal year do not revert to any other fund but remain in the fund for expenditure for subsequent fiscal years. The bill prohibits the authority from using more than percent of the moneys in the fund at the beginning of a fiscal year for purposes of administrative costs and other program support.49, for deposit in any other fund created under Code chapter 16, part 4. The executive director of the authority (executive director) is required to report any fund transfers to the legislative fiscal committee of the legislative council (legislative committee) on a monthly basis. The required contents of the report are detailed in the bill. The legislative committee’s annual report must include a summary of all fund transfers.5(1)(s), for deposit in the disaster recovery homeowner assistance fund with the prior written consent and approval of the governor. The prior written consent and approval of the director of the department of management is not required to transfer the unobligated and unencumbered moneys.106A(1)(o), for deposit in the disaster recovery homeowner assistance fund, with the prior written approval of the director of the economic development authority and the prior written approval of the governor. The executive director is required to report all fund transfers to the legislative committee on a monthly basis. The required contents of the report are detailed in the bill. The legislative committee’s annual report must include a summary of all of the fund transfers. The bill directs the authority to establish and administer a disaster recovery homeowner assistance program (program) and to use moneys in the fund to provide forgivable loans to eligible homeowners of disaster-affected homes. “Disaster-affected home” is defined in the bill as a primary residence that is destroyed or damaged due to a natural disaster that occurs on or after the effective date of the bill, and that is located in a county that due to the natural disaster is the subject of a state of disaster emergency proclamation by the governor that authorizes disaster recovery homeowners assistance; or a primary residence that is destroyed or damaged due to a natural disaster that occurred on or after March 12, 2019, but before the effective date of the bill, and is located in a county that has been declared a major disaster by the president of the United States on or after March 12, 2019, and that is also a county in which individuals are eligible for federal individual assistance. The authority may enter into an agreement with one or more local program administrators (administrator) to administer the program, and moneys in the fund may be expended following a state of disaster emergency proclamation by the governor that authorizes disaster recovery homeowner assistance. “Local program administrator” is defined in the bill as the cities of Ames, Cedar Falls, Cedar Rapids, Council Bluffs, Davenport, Des Moines, Dubuque, Iowa City, Waterloo, and West Des Moines; and a council of governments whose territory includes at least one county that is the subject of the state of disaster emergency proclamation by the governor that authorizes disaster recovery homeowner assistance; or a qualified local organization or governmental entity as determined by rules as adopted by the authority.20B. The homeowner’s disaster case manager may refer the homeowner to the appropriate local program administrator. To be eligible for a forgivable loan under the program, the bill requires a homeowner to own a disaster-affected home (home) located in a county that has been proclaimed a state of disaster emergency by the governor; the home must have sustained damage greater than the damage that is covered by the homeowner’s property and casualty insurance policy insuring the home plus any other state or federal disaster-related financial assistance that the homeowner is eligible to receive; an administrator must deem the home suitable for rehabilitation or damaged beyond reasonable repair; and if the homeowner is seeking a forgivable loan for the repair or rehabilitation of the homeowner’s disaster-affected home, the home cannot be proposed for buyout by the county or city in which the home is located. If a homeowner is referred to an administrator by the homeowner’s manager, the bill allows the authority to award a forgivable loan to the eligible homeowner for repair or rehabilitation of the disaster-affected home, or for down payment assistance on the purchase of replacement housing, and the cost of reasonable repairs to be performed on the replacement housing to render it decent, safe, sanitary, and in good repair. Replacement housing purchased by a homeowner cannot be located in a 100-year floodplain. All awarded forgivable loans must be interest-free and have a five-year term. The maximum forgivable loan that may be awarded to any one eligible homeowner shall be determined by the authority by rule.703. “Replacement housing” is defined in the bill as housing purchased by a homeowner to replace a disaster-affected home that is destroyed or damaged beyond reasonable repair as determined by a local program administrator. A uniform percentage of a forgivable loan awarded to a homeowner must be forgiven by the authority on a monthly basis as determined by rules adopted by the authority. If a homeowner who has been awarded a forgivable loan sells a disaster-affected home or replacement housing for which the homeowner received the forgivable loan prior to the end of the five-year term, the remaining principal on the forgivable loan becomes due and payable pursuant to rules adopted by the authority. Ninety calendar days after a state of disaster emergency proclamation by the governor authorizes disaster recovery homeowner assistance under the program, the authority must submit a report to the general assembly that covers the calendar days immediately preceding the report. The authority must also submit an annual report to the general assembly for the calendar year immediately preceding the year of the report. The required contents of each report are detailed in the bill. The authority is required to adopt rules to implement and administer the fund and the program. The bill takes effect upon enactment.