9.1 MPDU Owner’s Notification to the Department. For the first sale of an MPDU after the expiration of the Control Period, the MPDU Owner must provide the following information to the Department at least 30 days prior to settlement:
(a) A copy of the signed sales contract which clearly states the agreed upon Purchase Price;
(b) A copy of the real estate broker’s listing agreement;
(c) An itemized list of capital improvements made by the current MPDU Owner including actual or estimated value of the improvements with documentation of the value in a form acceptable to the Department; and
(d) The name and contact information for the settlement agent.
9.2 Payment of Excess Proceeds to the Housing Initiative Fund. For the first resale of an MPDU which was originally offered for sale or rent after March 20, 1989, and for which the Control Period has expired, the MPDU Owner must pay to the Housing Initiative Fund one-half of the excess proceeds.
(a) Excess proceeds are defined as the amount by which a bona fide resale price exceeds the sum of the following:
(1) The MPDU Owner’s Purchase Price;
(2) An allowance for the increase in the cost of living as determined by the Consumer Price Index from the date of the MPDU Owner’s purchase of the MPDU to the date of settlement;
(3) An allowance for capital improvements, as determined by the Department, made to an MPDU subsequent to the date of the MPDU Owner’s purchase of the MPDU; and
(4) The actual brokerage fee at the average prevailing commission rates if a licensed realtor under an arms-length contract to sell the MPDU is used; however, the commission must not exceed six (6) percent of the sales price.
(b) The Department must notify the MPDU Owner of the calculation of the excess proceeds, which is the amount that must be paid to the Housing Initiative Fund within 21 days of receiving complete information from the MPDU Owner.
(c) The required portion of the excess proceeds must be collected at the time of settlement. The MPDU Owner is responsible for ensuring that the payment is made to the Housing Initiative Fund in accordance with this regulation. A copy of the final settlement sheet for the transfer of ownership must be sent to the Department within 14 days of the date of settlement on the transfer of the MPDU. The Department must release the MPDU Covenants and liens recorded in the land records after the County has received the required payment to the Housing Initiative Fund and the settlement documents.
(d) Failure of the MPDU Owner to notify the Department of a sale, obtain a determination of excess proceeds, and pay the required portions of the excess proceeds to the Housing Initiative Fund constitutes a default under the MPDU Covenants, this regulation, and Chapter 25A.
9.3 Divorce. If one MPDU Owner buys out the other owner’s interest in the MPDU as part of a divorce settlement, without selling the MPDU on the open market, then such a transfer does not constitute the first sale of the MPDU, and does not relieve the remaining MPDU Owner of the obligation to pay the required portion of the excess proceeds to the Housing Initiative Fund.
