Section 44. The requirements with respect to rentals and tenant selection for low-rent housing projects shall apply to units leased by a housing authority under the rental assistance program, except that (a) as between applicants, who need not be residents of the city or town, but shall be residents of the commonwealth who applied at the same time and who are eligible for occupancy, preference shall be given in the selection of tenants to the following types of applicants: first to families with four or more minor dependents, then to families displaced by public action, then to elderly persons of low income, and then to handicapped persons of low income or families of low income of which one or more persons is handicapped; provided, however, that in the case of any project financially assisted by the federal government, preference shall be given in the selection of tenants in whatever manner is required by federal legislation or regulation; [There is no clause (b).] (c) a housing authority shall release and assign its rights under any lease to the tenant then occupying a dwelling unit or such other housing units subject to regulations promulgated by the department of community affairs not inconsistent with the standards required for dwelling units under the rental assistance program provided the tenant so requests, and provided the tenant demonstrates financial ability to pay the full rent called for under the lease; and (d) payments to the owner of a dwelling unit or said other housing unit leased under the rental assistance program shall be made in the manner determined by the housing authority and agreed to by said owner. Amounts paid on behalf of tenant families under the rental assistance program shall not be considered in determining the amount of welfare or other public assistance payments to which they may be entitled.

Funds appropriated for the rental assistance program established by sections forty-two to forty-four, inclusive, or which may become available therefor from the federal government or any other sources, shall be allocated within the following limits:— cities with over five hundred thousand population, not in excess of fifty per cent of such funds for any one such city; cities and towns with between one hundred thousand and five hundred thousand population, not in excess of twenty per cent of such funds for any one such city or town; and cities and towns under one hundred thousand population, not in excess of ten per cent of such funds for any one such city or town. The department shall allocate funds on the basis of applications therefor from the housing authorities; provided, however, that if, after May the thirty-first, nineteen hundred and seventy, a housing authority has expended all of the funds allocated pursuant to this paragraph, the department may, in its discretion, utilize funds appropriated but not allocated pursuant to sections forty-two to forty-four, inclusive of this chapter to provide additional rental assistance funds to such an authority. The department may make advances of funds to a local housing authority in such amount not to exceed five thousand dollars to an authority in each calendar year for purposes of negotiating leases for the rental assistance program; provided, however, such advances of funds shall be made upon the condition that such advances of funds shall be repaid out of any monies which become available to such authority for said rental assistance program.

No more than five per cent of the funds allocated by the department for the purposes of carrying out the provisions of the rental assistance program shall be used for the leasing of units other than dwelling units.