This chapter is adopted under Housing and Community Development Article, Title 4, Subtitle 2, Annotated Code of Maryland, to implement a program of community development projects in the State to be known as the Live Near Your Work (LNYW) Program. The LNYW Program is a cooperative effort between the State, local jurisdictions, and employers to provide financial assistance to eligible employees in purchasing homes near their place of employment. This chapter describes the policies, procedures, and authorizations for the operation of the LNYW Program. The objectives of the Program are to: Stimulate homeownership in designated neighborhoods; Promote public/private partnerships to strengthen communities; Support State transportation policy by promoting shorter commuting times; and Support employer compliance with the federal Clean Air Act Amendments of 1990. In this chapter, the following terms have the meanings indicated. Terms Defined. Closing Costs. “Closing costs” means costs incurred in connection with purchasing an eligible residence. “Closing costs” include: Credit report fee; Appraisal fee; Home inspection fee; Survey fee; Title examination; Loan origination fee; Title insurance fee; Homeownership counseling fee; Application fee; Attorneys' fees; Document preparation fee; Recording fees; State and local transfer tax; and State recordation tax. “Department” means the Department of Housing and Community Development, a principal department of the State. “Designated neighborhood”' has the meaning stated in Housing and Community Development Article, §§6-301(b) and 6-306(b), Annotated Code of Maryland. “Eligible employee” means an individual who: Is employed by an employer approved pursuant to Regulation .05 of this chapter; Is 18 years old or older; Has a contract to purchase an eligible residence located in the employer's applicable LNYW area; Shall hold title to an eligible residence; Shall make a cash contribution of at least $1,000 toward the cost of the downpayment or closing costs in connection with purchasing an eligible residence; and Meets any additional eligibility requirements imposed by the local jurisdiction or the participating employer and approved by the Department. “Eligible residence” means a dwelling unit that is: The primary residence of an eligible employee; Located in the LNYW area of the eligible employee's employer; and A single unit property, including a townhouse or condominium, or is a two to four unit property and the eligible employee occupies one of the units. “Family of limited income” means a household meeting income limits established for this Program by written determination of the Secretary. “Household” means the individual or individuals who occupy or intend to occupy the: Eligible residence, in the case of a single unit property; or Unit in the eligible residence occupied by the eligible employee, in the case of a two to four unit property. “Household income” means 100 percent of the projected annual gross income, based on current rate of income, from all members of the household 18 years old or older including Social Security income, retirement income, pensions, wages, overtime, bonuses, commissions, investment and interest income, rental income, disability or unemployment insurance, alimony and support payments, and all other income from any sources, less: Abnormal expenses of a long-term, unusual nature such as extraordinary unreimbursable medical, rehabilitation, or special education expenses; Unusual or temporary one-time income items, such as judgments or gifts, as determined by the Department; Income of a full-time high school or undergraduate college student, unless that individual is to hold title to an eligible residence; and Other income items as may be excluded by the Department. “LNYW area” means an area that: Is the same as or is a part of the area or areas that lie within the LNYW boundary for the local jurisdiction; Is designated by an employer that desires to participate in the Program as the area where eligible employees may purchase a home; Has a relationship to the employer's location that supports the objectives of the Program; Is approved by the local jurisdiction; and Is approved by the Department. “LNYW boundary” means an area or areas within a local jurisdiction that: Coincides with or lies within one or more designated neighborhoods located within the local jurisdiction; Is approved as the local jurisdiction's LNYW boundary by a resolution of the governing body of the local jurisdiction; and Is approved by the Department. “LNYW grant” means the funds granted by the local jurisdiction to the eligible employee under the terms of this chapter, with combined funds from the Department, the local jurisdiction, and the employer. “LNYW project” means the Program operated by the local jurisdiction within the LNYW boundary for the local jurisdiction. “Local development agency” has the meaning stated in Housing and Community Development Article, §4-201(l), Annotated Code of Maryland. “Local development corporation” has the meaning stated in Housing and Community Development Article, §4-201(m), Annotated Code of Maryland. “Local jurisdiction” means either a municipal corporation subject to the provisions of the State Constitution, Article XI-E, or any one of the 23 counties of the State or Baltimore City. “Nonprofit organization” has the meaning stated in Housing and Community Development Article, §1-101(g), Annotated Code of Maryland. “Program” means the Live Near Your Work Program. “Program grant” means the funds granted by the Department to a local jurisdiction to be used for the Department's contribution to LNYW grants. “Secretary” means the Secretary of Housing and Community Development. Application Process. The Department may set periodic deadlines for applications from local jurisdictions. The local jurisdiction shall submit an application to the Department in the form and containing the information and documentation required by the Department. Awarding Program Grants to Local Jurisdictions. The Assistant Secretary for Neighborhood Revitalization and the Assistant Secretary who is the Director of the Community Development Administration shall: Review all applications from local jurisdictions; and Recommend to the Housing Finance Review Committee established under Housing and Community Development Article, §4-208, Annotated Code of Maryland, for review and recommendation to the Secretary, the amount of all Program grants to local jurisdictions based on the: Capacity of the local jurisdiction to operate a LNYW project, and Financial commitment of the local jurisdiction and the employers. The Secretary shall by written determination approve, disapprove, or modify the terms of all Program grants after receipt of the recommendation of the Housing Finance Review Committee. If the Secretary approves a Program grant, the written determination from the Secretary shall also: Approve the LNYW project as a community development project as defined in Housing and Community Development Article, §4-217, Annotated Code of Maryland; and Approve the LNYW boundary. The Department may set deadlines and conditions for using the Program grant. Each local jurisdiction approved for a Program grant under §B of this regulation shall enter into a grant agreement with the Department which provides: That the local jurisdiction shall: Provide a minimum of $1,000 for each LNYW grant and demonstrate to the satisfaction of the Department that funds have been committed for that purpose, Ensure that at least 51 percent of the eligible employees who receive LNYW grants from the local jurisdiction's LNYW project are families of limited income, Agree to cooperate with the Department in conducting evaluations and analyses of the Program, and Develop a marketing plan to promote the Program that is satisfactory to the Department; and Other terms and conditions required by the Department. Conditions on LNYW Grants. The contribution from the local jurisdiction may be in the form of a grant or a conditional grant. A conditional grant is subject to the following minimum terms and conditions: Repayment of the grant may be required upon any terms and conditions approved by the Department; No interest is due on the unpaid portion of the grant; The term of the grant may not exceed 3 years; and A pro rata portion of the grant shall be released in each year of the term, so that at the end of the term the grantee is not required to repay the grant if all terms and conditions are met. The local jurisdiction may impose additional eligibility requirements for LNYW grants, including a minimum period of residency in the home purchased or homeownership counseling, if the additional restrictions: Do not violate any applicable law; Have been approved by the Department; and Are imposed on all LNYW grants from the local jurisdiction. The local jurisdiction may not impose income limits that are higher than the requirements under this chapter for families of limited income. Authorizing Another Entity. A local jurisdiction may authorize another entity to operate the LNYW project in that jurisdiction if the: Entity is a nonprofit organization, local development corporation, or local development agency; Local jurisdiction authorizes the entity to operate the Program in a resolution of its local governing body; Entity is approved by the Department to operate the LNYW project; and Local jurisdiction and the entity enter into a written agreement, which is approved by the Department, for the operation of the LNYW project. If a local jurisdiction authorizes another entity to operate the LNYW project in that jurisdiction, the entity shall: Execute the grant agreement with the Department or, if the local jurisdiction has already executed a grant agreement with the Department, execute an amendment to the grant agreement agreeing to assume the local jurisdiction's rights and responsibilities under the grant agreement; and Take all actions described in this chapter for the local jurisdiction except for actions to designate an LNYW boundary. If a local jurisdiction authorizes another entity to operate the LNYW project in that jurisdiction, either the local jurisdiction or the entity may provide the matching funds required of the local jurisdiction. To be eligible to participate in the LNYW project operated by the local jurisdiction, an employer shall: Complete any application required by the local jurisdiction or the Department; Except as provided in §F(2) of this regulation, provide a minimum contribution of $1,000 for each LNYW grant made to one of its employees; In coordination with the local jurisdiction, designate an LNYW area that coincides with or is within the LNYW boundary for the local jurisdiction, in the form required by the Department; Coordinate participation in the Program with the local jurisdiction; and Submit all other materials to and comply with any restrictions imposed by the local jurisdiction or the Department. The contribution from the employer may be in the form of a grant or a conditional grant as described in Regulation .04D of this chapter. Employers may set eligibility requirements that are reasonably related to the employer-employee relationship for their employees to receive an LNYW grant if the eligibility requirements: Do not violate any applicable law; Are approved by the local jurisdiction; Are approved by the Department; and Are imposed on all eligible employees. An employer may offer additional benefits to its employees in connection with the purchase of an eligible residence. If an employer has more than one location, there shall be an LNYW area for each location, each of which shall comply with all requirements of this chapter for designation and approval of an LNYW area. The LNYW areas for an employer under this section may overlap. In addition to any other requirements of this chapter, an employee and a residence shall only be eligible if the residence is located in the LNYW area of the employer for the location where the employee works. Employer Groups. Two or more employers located in the same local jurisdiction may join together to combine resources from which LNYW grants may be made if: The group of employers agrees to contribute at least $1,000 to each LNYW grant made by the group of employers; LNYW grants are made by the group of employers only to employees of employers in the group; The group of employers submits to the local jurisdiction an application, an LNYW area map, and any other materials requested by the local jurisdiction or the Department, consistent with §A of this regulation; and The application and LNYW area are approved by the local jurisdiction and the Department. Each employer in a group of employers approved under this regulation shall make a contribution of at least the minimum amount established by the group of employers, which may be less than $1,000 for each LNYW grant. A group of employers approved under this regulation may impose eligibility requirements consistent with §C of this regulation and may offer additional benefits consistent with §D of this regulation in connection with any LNYW grants made by the group of employers. The contribution from a group of employers pursuant to this regulation may be in the form of a grant or a conditional grant as described in Regulation .04D of this chapter. An eligible employee shall: Comply with the Program requirements and terms for receiving an LNYW grant; and Respond to periodic surveys for Program evaluation purposes including a survey to be completed at settlement. Only one person per household may receive an LNYW grant. Program grants from the Department to the local jurisdiction shall be used solely to fund $1,000 of an LNYW grant to an eligible employee. Program grants from the Department to the local jurisdiction may not be used to: Fund an LNYW grant if the eligible employee, the employer, and the local jurisdiction do not make the minimum contribution set forth in this chapter; or Fund any expenses of operating the LNYW project. An LNYW grant may only be used for the downpayment and closing costs incurred in connection with purchasing an eligible residence. An LNYW grant may not be used to pay costs incurred in connection with a transfer of property where the grantor remains a title holder. At the closing on an eligible residence, the local jurisdiction shall provide funds for the local jurisdiction's contribution and the Department's contribution to the LNYW grant. Before agreeing to fund an LNYW grant to an employee, the local jurisdiction shall confirm: That the property to be purchased is an eligible residence; The eligibility of the employer and the employee; The employee's household income; That the employee has already made or at closing shall make a contribution of at least $1,000 towards the purchase of the home; That the employer has made a contribution of at least $1,000 towards the LNYW grant; and That at least 51 percent of all of the LNYW grant recipients for the local jurisdiction's LNYW project are families of limited income. The local jurisdiction may, at its own risk, fund LNYW grants which do not comply with §B(6) of this regulation. However, the Department shall only reimburse the local jurisdiction for the Department's contribution to an LNYW grant if, at the time the request for reimbursement is submitted to the Department, at least 51 percent of the LNYW grant recipients for the local jurisdiction's LNYW project are families of limited income. After the closing, the local jurisdiction shall submit to the Department a request for reimbursement of the Department's contribution to the LNYW grant in the form required by the Department. The Department may require evidence of the closing and the fulfillment of all Departmental requirements before reimbursing the local jurisdiction for funds advanced for the Department's share of the LNYW grant. If any of the requirements of this chapter have not been met, the Department may deny a request for reimbursement. Reporting Requirements. The local jurisdiction shall make a report to the Department at times required by the Department. The report shall be in the form and contain information required by the Department. Overcommitment. If a local jurisdiction receives an application and financial commitment from an employer which would cause the total amount of financial commitments from all employers to exceed the total amount of the Program grant to the local jurisdiction, the local jurisdiction may not accept the new employer in the local jurisdiction's LNYW project, unless the local jurisdiction first informs all participating employers that: The local jurisdiction intends to accept a new commitment from an employer which will cause the total financial commitments of employers to exceed the total amount of the Program grant; Funds may be unavailable to fund all applications for LNYW grants; and Any new applications for LNYW grants shall be funded on a first-come, first-served basis. Right to Reallocate. At any time after 6 months from the date of any grant agreement with a local jurisdiction, the Department may elect to reallocate any unused Program grant funds, originally allocated to a local jurisdiction, to another local jurisdiction. The Department may establish operational handbooks or manuals governing matters relating to the Program including descriptive statements of Program procedures and policies. The Secretary may delegate to the Assistant Secretary for Neighborhood Revitalization, the Assistant Secretary who is the Director of the Community Development Administration, or any other official or employee of the Department, the authority to execute Program documents. The Secretary may waive or vary particular provisions of this chapter to the extent that waiver is not inconsistent with Housing and Community Development Article, Annotated Code of Maryland, if, in the determination of the Secretary, the application of a regulation in a particular case or in an emergency situation would be inequitable or contrary to the purposes of Housing and Community Development Article, Annotated Code of Maryland, or the purpose authorized for the Program. Reconsideration. A local jurisdiction, employer, or person dissatisfied with any decision of the Department may request reconsideration by writing to the Assistant Secretary for Neighborhood Revitalization and the Assistant Secretary who is the Director of the Community Development Administration. An initial decision or reconsideration of a decision is not a contested case within the meaning of the Administrative Procedure Act or COMAR 05.01.01. Housing and Community Development Article, Title 4, Subtitle 2, Annotated Code of Maryland Effective date: June 29, 1998 (25:13 Md. R. 992)