(a) Housing for rental or ownership by persons with very low, low or moderate income; or

(b) The commercial component of a structure that contains both commercial property and housing for persons with very low, low or moderate income.

(2) The department shall specify by rule the grounds on which it may deny loan guarantees for a structure described under subsection (1)(b) of this section, including the grounds that the structure contains a commercial component that is excessive in scope or that is of a type incompatible with residential housing.

(3) The Oregon Housing Stability Council shall review and approve policies for underwriting loans guaranteed by the Guarantee Fund to ensure that the loans meet prudent underwriting standards.

(4) A guarantee may not be prepared or construed in such a manner as to violate the provisions of Article XI, section 7, of the Oregon Constitution.

(5) The department may not issue any loan guarantee under this section that:

(a) Guarantees the repayment of more than 50 percent of the original principal balance of any loan; or

(b) Would cause the aggregate dollar amount of all loan guarantees issued by the department under this section to exceed two times the total amount then in the Guarantee Fund.

(6) The council may adopt preferences for using the Guarantee Fund to guarantee loans that the department determines will:

(a) Provide the greatest number of housing units for persons with very low, low or moderate income constructed, acquired, developed or rehabilitated for the amount of guarantee allowed;

(b) Ensure the longest possible use for the units as housing units for persons with very low, low or moderate income; or

(c) Include a program of services for the occupants of the proposed housing including, but not limited to, programs that address home health care, mental health services, alcohol and drug treatment and post-treatment care, child care or case management, if the housing proposed is multifamily rental housing.

(7) The council may adopt a policy that gives loan guarantee preference to loans for housing or structures described in subsection (1) of this section for which the department has provided a grant, loan, tax credit or other investment.

(8) Subject to approval by the council, each fiscal year the department may make a transfer from the Housing Development and Guarantee Account to the Affordable Housing Land Acquisition Revolving Loan Program under ORS 456.502 in an amount not to exceed 50 percent of the difference between the balance of the Guarantee Fund and one-half of the aggregate amount of all outstanding loans guaranteed by the Guarantee Fund. [1991 c.740 §6; 1993 c.2 §1; 1997 c.329 §1; 2003 c.20 §1; 2003 c.743 §6; 2007 c.607 §25; 2015 c.180 §26; 2015 c.608 §3; 2019 c.576 §2]