Section 2. (a) There shall be within the department a separate fund to be known as the Housing Stabilization and Investment Trust Fund. The department shall administer the fund and shall ensure that funds are distributed among urban, suburban and rural areas with a particular emphasis on the local and regional needs for the purpose of undertaking projects to develop and support affordable housing developments and homeownership affordability, through the acquisition, preservation, new construction and rehabilitation of affordable housing. The program may include assistance for projects to stabilize and promote reinvestment in cities and towns including, but not limited to, acquisition, rehabilitation, new construction and preservation of foreclosed and distressed properties and any other techniques necessary to achieve reinvestment; provided, further, that funds from this item may be expended for the purpose of energy audits and housing modifications to achieve energy efficiency and conservation. The fund shall be an expendable trust fund and shall not be subject to appropriation.

(b) There shall be credited to the fund, revenue from appropriations or other monies authorized by the general court and specifically designated for the fund and any gifts, grants, private contributions, repayment of loans, fees and charges imposed relative to the making of loans, grants, subsidies, credit enhancements and other financial assistance, investment income earned on the fund's assets and any other sources. Money remaining in the fund at the end of a fiscal year shall not revert to the General Fund.

(c) The department shall provide assistance from the fund using only the criteria established in this chapter for projects owned or sponsored by nonprofit or for-profit organizations including, but not limited to, projects that involve complex multiple-source financing or the preservation of existing affordable housing; provided, however, that no assistance shall be authorized unless the sponsor thereof is current on all existing mortgage obligations with the commonwealth or any political subdivision thereof. The department shall enter into agreements with Massachusetts Housing Partnership Fund established in section 35 of chapter 405 of the acts of 1985 or the Community Economic Development Assistance Corporation established in chapter 40H to provide assistance from the fund for projects owned or sponsored by nonprofit organizations.