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South Bend edevelopment Commission <br />Regular Mee ing - August 17, 1979 <br />6. NEW BUSINESS <br />a. 31211oan applications (continued) <br />Name <br />Dennis Tinnin <br />225 Sou h Walnut <br />South B nd, IN. 46625 <br />Aphrodite, Mary & Anna <br />c/o 512 W. Madison <br />for 419­421 N. Taylor <br />South Bend, IN. <br />Amount Loan <br />$16,650.00 18 /SOU- 2/78/1 <br />Pappas <br />$14,100.00 18 /SOU- 2/79/2 <br />Mr. Ell son: The 312 loan application c/o 512 W. Madison for <br />419 -421 N. Taylor, to Aphrodite, Mary & Anna Pappas is an investor <br />loan. hey will have to sign a rent control agreement. It is an <br />acceptable method of providing housing for low income tenants. <br />Ms. Aub�rn: Do the tenants then become eligible for any kind of <br />rent su sidies or can they rent to anyone? <br />Mr. Ell son: HUD is currently discussing at the national level <br />the policy question of whether a 312 loan and rent subsidy should <br />be allocated in tandem to achieve rehabilitation. Currently <br />HUD's position is that they cannot allow this policy because it <br />would be considered a double subsidy. But, under special circum- <br />stances (if, for example, a double subsidy is necessary to achieve <br />a commu ity's housing strategy), a locality may request approval <br />from th Secretary of HUD and may receive it. <br />Ms. Auburn: If we are not concerned with the rent subsidy on <br />that house, why is there any kind of agreement on what the rent <br />is going to be at all? Why is this not left up to the private <br />party? <br />Mr. Ell son: A 312 loan should not result in displacement. If <br />you don t have a rent control agreement with the investor /owner, <br />you have no method of assuring that they won't obtain a low- <br />interest loan and then raise rents to the point beyond which a lower <br />income family can afford to pay. Therefore, without rent control, <br />the '312 loan could result in the displacement of a lower income <br />household. <br />Ms. Deroeck: Does a person have to be under a certain age to <br />obtain dn investor's loan? <br />Ms. Bau gartner: The investor loan is looked upon totally <br />differe t than an ordinary residential loan. The property has to <br />go to t e benefit of the low- and - moderate income people. <br />Mr.. Nim z: Ms. Baumgartner, do we have any records to compare <br />how wel we are doing with obtaining 312 loan applications in <br />compari on with other cities? <br />5 <br />