Article VII

BYLAWS

ARTICLE VII: OWNERSHIP OF HOUSING AND OTHER IMPROVEMENTS LOCATED ON THE CORPORATION’S LAND, AND LIMITATIONS ON RESALE

A.         Ownership of Housing and Improvements on the Corporation’s Land. In accordance with the purposes of the Corporation, the Board of Directors shall take appropriate measures to promote and facilitate the ownership of housing and other improvements on the Corporation’s land by low and moderate income people as defined in these Bylaws.  These measures may include, but are not limited to, provisions for the sale of housing to such people; provisions for financing the acquisition of housing by such people, including direct loans by the Corporation; and provision for grants or other subsidies that will lower the cost of such housing for such people. 

B.         Purchase by the Corporation of Property Located on the Corporation’s Land. It is the purpose of the Corporation to preserve the affordability and livability of housing, neighborhoods and communities, and other improvements for low and moderate income people in the future.  Accordingly, when land-use rights are leased, the Board of Directors shall assure that, as a condition of the lease, the Corporation is granted the right to purchase any lessee-owned housing or other improvements on the land, for a price determined by the “resale formula,” at such time as the lessees wish to sell or the lease is terminated.

C.        The Resale Formula. For the purpose of preserving affordability, the Corporation shall restrict the price that lessees may receive when they sell housing and other improvements located on the land leased to them by the Corporation.  A policy establishing such restrictions in the form of a “resale formula” shall be adopted by the Board of Directors and the regular Members of the Corporation, in accordance with the following principles:

1.         To the extent possible, the formula shall allow the seller to receive a price based on the value that the seller has actually invested in the property being sold.

2.         To the extent possible, the formula shall limit the price of the property to an amount that will be affordable for other low and moderate income people at the time of the transfer of ownership.

D.        Procedures for Adoption of the Resale Formula. The adoption of the resale formula shall require:

1.         An affirmative vote of two-thirds of the entire Board of Directors at any regular or special Board meeting, provided that written notice of such meeting has set forth the proposed formula with an explanation thereof; and

2.         An affirmative vote by at least two-thirds of the regular Members present at any regular and/or special Membership meeting, a quorum being assembled, provided that written notice of such meeting has set forth the proposed formula with an explanation thereof.

E.         Procedures for Altering the Resale Formula. The consistent long-term application of a resale formula is essential to the purposes of the Corporation.  Accordingly, the resale formula shall not be altered unless the Board of Directors and Regular Members of the Corporation determine that the current formula presents an obstacle to the achievement of the purposes of the Corporation.  In such an event, the resale formula may be altered only by a two-thirds vote of the entire Board of Directors and two-thirds of the Regular members present at a Membership meeting, as described above for the adoption of the formula.