determination or statement within said time limit and such delay results in an eligible unit remaining vacant, the Owner shall be entitled to housing assistance payments for the number of days of vacancy directly due to such delay.

1.10. Eviction. The Owner shall not evict any Family unless the Owner complies with the requirements of local law, if any, and of this Section. The Owner shall give the Family a written notice of the proposed eviction, stating the grounds and advising the Family that it has 10 days (or such greater number, if any, that may be required by local law) within which to respond to the Owner. The Owner must obtain the LHA's authorization for an eviction; accordingly a copy of the notice shall be furnished simultaneously to the LHA, and the notice shall also state that the Family may, within the same time period, present its objections to the LHA in writing or in person. The LHA shall forthwith examine the grounds for eviction and shall authorize the eviction unless it finds the grounds to be insufficient under the Lease. The LHA shall notify the Owner and the Family of its determination within 20 days of the date of receipt of the notice by the Family, whether or not the Family has presented objections to the LHA.

1.11. Owner-family lease. The Lease between the Owner (Lessor) and the Family (Lessee) shall contain the following provisions:

$

a. Of the total rent ($---- per month), shall be payable by the Housing Authority (LHA) as housing assistance payments on behalf of the Lessee and $---. shall be payable by the Lessee. These amounts shall be subject to changes by reason of changes in the family income or composition, as determined by the LHA, effective as of the date stated in a notification of such change by the LHA to the Lessee and Lessor.

b. The Lessor shall provide the following services (including security) and maintenance:

[here insert the complete list as contained in section 1.4b of the Housing Assistance Payments Contract]

c. The Lessor shall not evict the Lessee unless the Lessor complies with the requirements of local law, if any, and of this provision. The Lessor shall give the Lessee a written notice of the proposed eviction, stating the grounds and advising the Lessee that he has 10 days (or such greater number, if any,

that may be required by local law) within which to respond to the Lessor. Because the Lessor must obtain the LHA's authorization for an eviction, a copy of the notice shall be furnished simultaneously to the LHA, and the notice shall also state that the Lessee may, within the same time period, present his objections to the LHA in writing or in person. The LHA shall forthwith examine the grounds for eviction and shall authorize the eviction unless it finds the grounds to be insufficient under the Lease. The LHA shall notify the Lessor and the Lessee of its determination within 20 days of the date of receipt of the notice by the Lessee, whether or not the Lessee has presented obections to the LHA.

d. The Lessor shall not discriminate against the Lessee in the provision of services, or in any other manner, on the grounds of race, color, creed, religion, sex, or national origin.

Lessor

By: Date Lessee Date

WARNING: 18 U.S.C. 1001 provides, among other things, that whoever knowingly or willfully makes or uses a document or writing containing any false, fictitious, or fraudulent statement or entry, in any matter within the jurisdiction of any department or agency of the United States, shall be fined not more than $10,000 or imprisoned for not more than five years, or both.

[If the assisted units are to be completed and accepted in stages, execution of the Contract with respect to the several stages appears on the first pages of this Contract.]

sistance Payments Program because of membership in a class such as unmarried mothers, recipients of public assistance, etc. b. The Owner shall comply with all requirements imposed by Title VIII of the Civil Rights Act of 1968, Public Law 90-284, 82 Stat. 73 and any rules and regulations pursuant thereto.

c. The Owner shall comply with all requirements imposed by Title VI of the Civil Rights Act of 1964, Public Law 88-352, 78 Stat. 241; the regulations of the Department of Housing and Urban Development issued thereunder, 24 CFR, Subtitle A, Part 1, § 1.1, et seq.; the requirements of said Department pursuant to said regulations; and Executive Order 11063 to the end that, in accordance with that Act, the regulations and requirements of said Department thereunder, and said Executive Order, no person in the United States shall, on the ground of race, color, creed, religion or national origin, be excluded from participation in, or be denied the benefit of, the Housing Assistance Payments Program, or be otherwise subjected to discrimination. This provision is included pursuant to the regulations of the Department of Housing and Urban Development, 24 CFR, Subtitle A, Part 1, § 1.1, et seq.; issued under Title VI of the said Civil Rights Act of 1964, and the requirements of said Department pursuant to said regulations; and the obligation of the Owner to comply therewith inures to benefit of the Government, the said Department, and the LHA any of which shall be entitled to invoke any remedies available by law to redress any breach thereof or to compel compliance therewith by the Owner.

2.2 Employment of project area residents and contractors. The Owner shall comply and shall require each of its contractors and subcontractors employed in the performance of this Contract to comply (including compliance with the Government-approved affirmative action plan for utilization of project area businesses) with section 3 of the Housing and Urban Development Act of 1968 (12 U.S.C. 1701u) and the regulations and requirements of the Government thereunder, requiring that, to the greatest extent feasible, opportunities for training and employment be given lower income residents of the project area and that contracts for work in connection with the operation of the Premises be awarded to business concerns which are located in or owned in substantial part by persons residing in the area of the Premises.

2.3. Cooperation in equal opportunity compliance reviews. The LHA and the Owner shall cooperate with the Government in the conducting of compliance reviews and complaint investigations pursuant to all applicable civil rights statutes, Executive Orders, and rules and regulations pursuant thereto.

2.4. Flood insurance. If the Premises are located in an area that has been identified by the Secretary of Housing and Urban Development as an area having special flood

hazards and if the sale of flood insurance has been made available under the National Flood Insurance Act of 1968, the Owner agrees that the Premises will be covered, during its anticipated economic or useful life, by flood insurance in an amount at least equal to its development or project cost (less estimated land cost) or to the maximum limit of coverage made available with respect to the particular type of property under the National Flood Insurance Act of 1968, whichever is less.

2.5. Units not leased to eligible families. a. If at any time, beginning three months after the execution of this Contract, the Owner fails for a continuous period of three months to have at least 80% of the Contract units leased by eligible Families, the LHA shall refer to the Owner available eligible Families interested in leasing his units. If the LHA makes such referrals to the Owner and the Owner refuses to accept such Families without good reason, in the Judgment of the LHA, the LHA, with Government approval, may on 30 days notice reduce the number of units under this Contract to not less than the number of units under lease by eligible Families; provided, however, that an additional 11% of the number of such leased units may be allowed if the number of such leased units is 10 or more.

b. As of the end of the initial term of this Contract and of each renewal term, the LHA, with Government approval, may reduce the number of units under this Contract to not less than (1) the number of units under lease by eligible Families at that time or (ii) the average number of units so leased during the last year, whichever is the greater number; provided, however, that an additional 11% of the number (or average number, as the case may be) of such leased units may be allowed if the number of such leased units is 10 or more.

c. In the event of any reduction in the number of units under this Contract, in accordance with this Section, the LHA and the Government shall amend the ACC to reduce the amount of annual contributions payable thereunder to an amount commensurate with the lower number of units covered by this Contract.

2.6. LHA and government access to premises and owner's records. The Owner shall permit the LHA and the Government or any of their duly authorized representatives to have access to the Premises and, for the purpose of audit and examination, to have access to any books, documents, papers and records of the Owner that are pertinent to compliance with this Contract including the verification of information pertient to the monthly requests to the LHA for housing assistance payments.

2.7. Default by the owner. a. A Default by the Owner under this Contract shall result if:

(1) The Owner has violated or failed to comply with any provisions of this Contract or of any Owner-Family Lease; or

(2) The Owner has failed to perform any of his obligations under this Contract or under any Owner-Family Lease; or

(3) The Owner has asserted or demonstrated an intention not to perform some or all of his obligations under this Contract or under any Owner-Family Lease.

b. Upon the determination by the LHA that a Default has occurred, the LHA, with approval of HUD, may notify the Owner that the LHA is terminating the Contract effective 30 days from the date of notice, unless within that period the Owner cures any non-compliance, or initiates a course of corrective action which will cure the noncompliance within such minimum additional time as may be necessary and agreed to by the LHA with the approval of the Government. If the LHA so notifies the Owner, it shall also send a copy of such notice to the Families, together with information regarding continued assistance.

2.8. Default by the LHA. a. A Default by the LHA under this Contract shall result if: (1) The LHA has violated or failed to comply with any provisions of the Contract or failed to perform any of its obligations under this Contract; or

(2) This Contract at any time is held to be void, voidable, or ultra vires, or the power or right of the LHA to enter into this Contract is drawn into question in any legal proceeding; or

(3) the LHA asserts or claims that this Contract is not binding upon it for any reason, or otherwise asserts or demonstrates that it does not intend to fulfill its obligations under said Contract.

b. Upon the determination by the Government that a Default by the LHA has occurred, the following provision of the ACC (which is hereby made a part of this Contract), shall be applicable:

[In such case] the Local Authority shall, if the Government so requires, assign to the Government all of its rights and interests in and to the Project, or such part thereof as the Government may specify and the Government shall continue to pay Annual Contributions with respect to dwelling units covered by Housing Assistance Payments Contracts in accordance with the terms of this ACC until reassigned to the Local Authority. After the Government shall be satisfied that all defaults with respect to the Project have been cured and that the Project will thereafter be operated in accordance with the terms of this ACC, the Government shall reassign to the Local Authority all of the rights and interests of the Government in and to the Project as such rights and interests exist at the time of such reassignment.

2.9. Remedies not exclusive and non-waiver of remedies. Any remedy provided for herein shall not be exclusive or preclude the Owner, LHA and/or the Government from exercising

any other remedy available under this Contract or under any provisions of law, nor shall any action taken in the exercise of any remedy be deemed a waiver of any other rights or remedies available to such parties. Failure on the part of any such party to exercise any right or remedy shall not constitute a waiver of that or any other right or remedy, nor operate to deprive the party of the right thereafter to take any remedial action for the same or any subsequent default.

2.10. Disputes. a. Except as otherwise provided herein, any dispute concerning a question of fact arising under this Contract which is not disposed of by agreement of the LHA and Owner may be submitted by either party to the U.S. Department of Housing and Urban Development field office director who shall make a decision and shall mail or otherwise furnish a written copy thereof to the Owner and the LHA.

b. The decision of the field office director shall be final and conclusive unless, within 30 days from the date of receipt of such copy, either party mails or otherwise furnishes to the Government a written appeal addressed to the Secretary of Housing and Urban Development. The decision of the Secretary or his duly authorized representative for the determination of such appeals shall be final and conclusive, unless determined by a court of competent jurisdiction to have been fraudulent, or capricious, or arbitrary, or so grossly erroneous as necessarily to imply bad faith, or not supported by substantial evidence. In connection with any appeal proceeding under this Section, the appellant shall be afforded an opportunity to be heard and to offer evidence in support of his appeal. Pending final decision of a dispute hereunder, both parties shall proceed diligently with the performance of the Contract and in accordance with the decision of the field office director.

c. This Section does not preclude consideration of questions of law in connection with the decisions rendered under paragraph a and b of this Section; Provided, however, that nothing herein shall be construed as making final the decision of any administrative official, representative, or board on a question of law.

2.11. Interest of members, officers or employees of LHA, members of local governing body of other public officials. No member, officer, or employee of the LHA, no member of the governing body of the locality (city and county) in which the Premises are situated, no member of the governing body of the locality in which the LHA was activated, and no other public official of such locality or localities who exercises any functions or responsibilities with respect to the Premises, during his tenure or for one year thereafter, shall have any interest, direct or indirect, in this Contract or in any proceeds or benefits arising from it.

2.12. Interest of member of or delegate to Congress. No member of or delegate to the

Congress of the United States of America or resident commissioner shall be admitted to any share or part of this Contract or to any benefits which may arise therefrom.

2.13. Nonassignability. a. The Owner agrees that he has not made, and will not make any sale, assignment, or conveyance or transfer in any other form, of this Contract or the Premises, or any part thereof, or any of his interest therein, except as follows: (1) with the prior consent of the LHA and the Government; or

(2) to a financial institution or trustee for the purpose of obtaining financing of the rehabilitation under this Contract, to which assignment the LHA and the Government shall consent in writing if requested by the Owner or the lender.

An assignment by the Owner to a limited partnership of which the Owner is the general partner shall not be considered an assignment herein.

b. The Owner agrees to notify the LHA and the Government promptly of any proposed action covered by paragraph c of this Section, and to request the written consent of the LHA and the Government in regard thereto.

c. For the purpose of this Section, a transfer of stock in the Owner in whole or in part by a party holding ten percent or more of the stock of said Owner, or a transfer by more than one stockholder or the Owner of ten percent or more of the stock of said Owner or any other similarly significant change in the ownership of such stock or in the relative distribution thereof in or with respect to the parties in control of the Owner or the degree thereof, by any other method or means, whether by increased capitalization, merger with another corporation, corporate or other amendments, issuance of new or additional stock or classification of stock or otherwise, shall be deemed an assignment, conveyance, or transfer with respect to this Contract or the Premises. With respect to this provision, the Owner and the party signing this Contract on behalf of said Owner, represent that they have the authority of all of the existing stockholders of the Owner to agree to this provision on behalf of said stockholders and to bind them with respect thereto.

APPENDIX XIII-DETERMINATION OF FAMILY ELIGIBILITY AND LEASE APPROVAL SUBSTANTIAL REHABILITATION

PART II-AUTHORITY DETERMINATION

(To be sent to the Owner and to the Family) (Check Applicable Boxes)

1. Additional information required. To enable this Authority to make a determination regarding the eligibility of the Family headed by the following additional information is required from the Owner:

After the Owner has submitted the required information he will be notified by this Authority of its determination within the time period specified in his Agreement or Contract with this Authority.

2. Determination of eligibility. This Authority has determined that the Family headed by is eligible for participation in the Housing Assistance Payments Program of this Authority as set forth in a Certificate of Family Participation issued and signed by this Authority. In addition, this Authority has determined that the proposed lease and the dwelling unit meet the program requirements, and they are hereby approved.

Returned herewith are (a) the Certificate of Family Participation, attached as Part III, and (b) the proposed lease, completed by the Authority with respect to the portion of the lease rental which the Family shall be obligated to pay to the Owner. The Certificate shall be signed by the Family and the lease shall be signed by the Owner and the Family. A copy of each signed document shall be returned to the Authority.

Attached is a Security Deposit Agreement signed by this Authority, which shall be signed by the Owner and the Family and returned to the Authority.

Yes No

(Name of Local Housing Authority)

By:

(Signature and Title of LHA Representative)

PART III-CERTIFICATE OF FAMILY PARTICIPATION

(To be sent to the Owner and the Family) 1. Certification. The undersigned Authority hereby certifies that the Family headed by is authorized to participate in the Section 23 Housing Assistance Payments Program of this Authority by leasing a unit consisting of bedrooms and located at: (Street Address and Apartment Number, if any).

Under this program, the Authority makes housing assistance payments on behalf of participating families toward their rents for decent, safe, and sanitary dwelling units.

2. Rent. Under the rules and regulations of the Housing Assistance Payments Program, the Family will be obligated to pay $ toward the monthly lease rental; provided that this amount will be reduced by the LHA-determined allowance for any utilities to be paid directly by the Family, and such reduced amount will be specified in the lease. The amount of the Family's payment is subject to change by reason of changes in the income or composition of the Family.

3. Conditions. The Family agrees to perform all its obligations under the Housing Assistance Payments Program including the obligations to (a) provide such Family income information and records as may be required in the administration of the program; (b) permit inspections of its dwelling unit at reasonable times and with reasonable advance notice; and (c) give at least 30 days notice to the Authority of the Family's intention to vacate the unit.

(Date)

(Name of Local Housing Authority) By: (Signature and Title of LHA Representative)

(Signature of Family Representative)

(Present Address of Family)

(Date)

NOTE: Appendices XIV and XV, which relate to internal HUD processing procedures,