(a) In furtherance of the purposes of this chapter, which are hereby determined to be county purposes for which county funds may be expended, each county shall, in addition to those powers otherwise conferred by any general statute, special act, charter or ordinance, have the following powers, except as otherwise limited by this chapter, and provided the exercise of such powers by a county shall be in accordance with the procedures established by this chapter:
Terms Used In Tennessee Code 7-60-201
Contract: A legal written agreement that becomes binding when signed.
County: means any county or any metropolitan form of government in this state having a population of two hundred thousand (200,000) or more, according to the 1980 federal census or any subsequent federal census, that by resolution has made the findings and determinations required by §. See Tennessee Code 7-60-103
Home: means residential housing, including real property and improvements on real property, consisting of one (1) or more dwelling units, including, but not limited to, condominium units, owned by one (1) person or family of lower or moderate income that occupies or intends to occupy one (1) of such units. See Tennessee Code 7-60-103
Lending institution: means any bank, trust company, savings bank, national banking association, federal national mortgage association approved mortgage banker, savings and loan association, building and loan association, credit union, mortgage banker or other financial institution or governmental agency that customarily provides service or otherwise aids in the financing of mortgages on residential housing in the state or any holding company for any of the lending institutions and that is located in the state. See Tennessee Code 7-60-103
Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
notes: means the bonds and notes respectively authorized to be issued by counties under this chapter. See Tennessee Code 7-60-103
Person: includes a corporation, firm, company or association. See Tennessee Code 1-3-105
Purposes of this chapter: means ameliorating the deterioration of counties by preserving and expanding employment opportunities in the construction and related industries and the tax base of counties by undertaking or assisting in the financing of home mortgages for persons and families of lower and moderate income. See Tennessee Code 7-60-103
Statute: A law passed by a legislature.
Trustee: A person or institution holding and administering property in trust.
United States: includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
(1) Acquire, and contract and enter into advance commitments to acquire, by assignment or otherwise, home mortgages owned by lending institutions or participations or other interests in home mortgages at such purchase prices and upon such other terms and conditions as shall be determined by the county or other person as it may designate as its agent, make and execute contracts with lending institutions for the origination and servicing of home mortgages and pay the reasonable value of services rendered under those contracts; provided, that such home mortgages shall be originated and serviced by lending institutions. In the administration of this program, the county shall ensure the reasonable opportunity of equal participation to every lending institution situated within the county as mortgage originators and servicers regardless of the size of such institution or of its share of any market area. Such commitments and contracts, together with all necessary forms, shall be made with and available to any and all lending institutions desiring to make such home mortgages available to persons and families of lower and moderate income. Each county shall include in its contracts and commitments any lending institution situated within the county owned or controlled by minority groups if such lending institution elects to participate in such program;(2) Make loans to lending institutions under terms and conditions that, in addition to other provisions as determined by the county, shall require the lending institutions to use substantially all of the net proceeds of the loans, directly or indirectly, for the making of home mortgages in an aggregate principal amount substantially equal to the amount of such net proceeds; provided, that each county shall make available loans to any lending institution situated within the county owned or controlled by minority groups;(3) Borrow money and issue its negotiable bonds and notes, and fund or refund the same, to defray, in whole or in part, the costs of purchasing or funding the making of home mortgages, including, but not limited to, the costs of studies and surveys, insurance premiums, underwriting fees and legal, accounting and financial advisory fees incurred in connection with the issuance and sale of such bonds and notes, including reserve funds and accounts and trustee, custodian and rating agency fees, interest on the bonds and notes for a period not exceeding two (2) years from their date, and designate appropriate names for such bonds and notes, and provide for the rights of the holders of the bonds and notes;(4) Sell or otherwise dispose of or enter into commitments for the sale or other disposal of any home mortgages, in whole or in part, or loan sufficient funds to defray, in whole or in part, the costs of purchasing home mortgages or participations in home mortgages, so that the revenues to be derived with respect to the home mortgages, together with any insurance proceeds, reserve funds and accounts and earnings on reserve funds and accounts, shall be designated to produce revenues and receipts at least sufficient to provide for the prompt payment at maturity of principal, interest and redemption premiums, if any, upon all bonds and notes issued to finance such costs;(5) Make qualified home improvement loans to persons or families who meet the criteria established under this chapter and who agree to abide by the proper rules and regulations promulgated for the administration of the loan program; and enter into any contract, with any person or institution, reasonably necessary to effect the purposes of this chapter;(6) Pledge home mortgages, notes or other property and any revenues and receipts to be received from home mortgages, notes or other property to the punctual payment of bonds and notes as issued under this chapter and the interest and redemption premiums, if any, on the bonds and notes;(7)(A) Make and publish rules and regulations respecting its financial assistance programs and such other rules and regulations as are necessary to effectuate the purposes of this chapter, including, but not limited to:
(i) The time within which lending institutions must make commitments and disbursements for home mortgages or qualified home improvement loans;(ii) The location and other characteristics of homes to be financed by home mortgages or qualified home improvement loans;(iii) The terms and conditions of home mortgages or qualified home improvement loans to be acquired;(iv) The amounts and types of insurance coverage required on homes, home mortgages or qualified home improvement loans and bonds;(v) The representations and warranties of lending institutions confirming compliance with such standards and requirements;(vi) Restrictions as to interest rates and other terms of home mortgages or qualified home improvement loans or the return realized from the mortgages or loans by lending institutions;(vii) The type and amount of collateral security to be provided to assure repayment of any loans from the county and to assure repayment of bonds;(viii) The classes of persons who may be eligible for mortgages or qualified home improvement loans under such program;(ix) The maximum purchase price of homes for which mortgages or qualified home improvement loans may be originated under such program; and(x) Any other matters related to the purchase of home mortgages or qualified home improvement loans or the making of loans to lending institutions as shall be deemed relevant by the county;(B) Following the date of issuance of any bonds or notes under this chapter, there shall be reserved from the lendable proceeds of the bonds or notes, for persons and families in targeted area, as defined in the federal law, not less than the percentage of such proceeds required by the federal law for not less than the period required by the federal law;(8) Establish and revise from time to time and charge and collect fees and charges in connection with making, purchasing and servicing any of its loans, notes, commitments and other evidences of indebtedness;(9) Employ financial advisors, engineers, attorneys, real estate counselors, appraisers and such other consultants and employees as may be required in the judgment of the county and fix and pay their reasonable compensation and expenses from moneys available to such county for their employment;(10) Make, enter into and enforce all contracts, including contracts for the servicing of mortgages or qualified home improvement loans necessary, convenient or desirable for the purposes of the county or to the performance of its powers under this chapter, including contracts with any person, firm, agency, governmental agency or other entity, and all Tennessee governmental agencies are hereby authorized to enter into contracts, and otherwise cooperate with a county to facilitate the purposes of the chapter;(11) Accept gifts, grants or loans of funds, property or services from any source, public or private, and comply, subject to this chapter and to any agreements with bondholders and noteholders, with the terms and conditions of the acceptance;(12) Sue and be sued and plead and be impleaded with respect to any action taken pursuant to powers granted by this chapter; and(13) To the extent required by the federal law, pay or credit arbitrage and investment gains to the mortgagors, to the United States or to such other party or parties as may be designated by the federal law.(b) Bonds shall not be issued under the powers granted in this chapter, unless such bonds are rated “A” or higher by one (1) of the two (2) major nationally recognized rating agencies, or unless such bonds are sold in a transaction not involving any public offering within the meaning of § 4(2) of the Securities Act of 1933 ( 15 U.S.C. § 77d ), and the rules and regulations promulgated under the Securities Act.
