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Issuer on the advice of Bond Counsel (a copy of which amendments shall be provided to the
Issuer, the Trustee and the FHA Lender), or in such other form and manner as may be required
by applicable rules, rulings, procedures, official statements, regulations or policies now or
hereafter promulgated or proposed by the Department of the Treasury or the Internal Revenue
Service with respect to obligations issued under Section 142(a)(7) of the Code;
(c) during the Qualified Project Period, the Borrower shall maintain complete and
accurate records pertaining to the dwelling units occupied or to be occupied by Low Income
Tenants, including Income Certifications, and will permit any duly authorized representative
of the Issuer, the Trustee, the Department of the Treasury or the Internal Revenue Service to
inspect the books and records of the Borrower pertaining to the Income Certifications of Low
Income Tenants residing in the Project for the purpose of verifying compliance by the Borrower
hereunder upon reasonable notice and at reasonable times. The Borrower agrees that in the
event of an Internal Revenue Service, Department of Treasury or Issuer audit of compliance
with the Regulatory Agreement as authorized by this paragraph (c), the Borrower will pay all
reasonable fees and expenses of the Issuer, its authorized representatives, and its counsel in
connection with such audit. The Borrower shall keep information as set forth in this paragraph
(c) for a period of three years following the end of the Qualified Project Period;
(d) during the Qualified Project Period, (i) the Borrower shall immediately notify
the Trustee and the Issuer if at any time the dwelling units in the Project are not occupied or
available for occupancy as provided in paragraph (a) above, (ii) the Borrower shall prepare and
submit to the Issuer, and following the closing of the FHA Insured Mortgage Loan, to the FHA
Lender, not later than the fifteenth (15th) day of the month following the initial occupancy of
any of the units in the Project and not later than the fifteenth (15th) day following the end of
each six months thereafter, a Compliance Certificate substantially in the form attached as an
exhibit to the Regulatory Agreement executed by the Borrower stating, among other matters,
the number of dwelling units of the Project which were occupied or were deemed to be occupied
by Low Income Tenants during such period and (iii) so long as any Bonds remain Outstanding,
the Borrower shall maintain a copy of each Compliance Certificate required under clause (ii) of
this subsection and submit copies thereof to the Trustee upon request;
(e) during the Qualified Project Period, the Borrower shall make the determination
of whether the income of a tenant of a unit in the Project exceeds the applicable limit at least
annually on the basis of the current income of the tenant by causing each tenant to execute a
recertification of their annual income. The Borrower shall require in the lease of each Low
Income Tenant that the tenant fill out an annual income recertification to help the Borrower
determine whether the tenant still qualifies as a Low Income Tenant. The Borrower shall provide
in each tenant’s lease that completion and execution of such certificates by the tenant is a
substantial obligation, noncompliance with which can result in termination of tenancy. Copies
of the recertification of a tenant shall be provided to the Trustee as provided in paragraph (b)
above; and
(f) the Borrower shall prepare and file with the Issuer, and following the closing
of the FHA Insured Mortgage Loan, the FHA Lender true copies of each IRS Form 8703 -
“Annual Certification of a Residential Rental Project” (or any successor form thereto) as
completed and filed with the Internal Revenue Service for each calendar year during the
Qualified Project Period, which certification shall be filed within thirty (30) days after each
anniversary of the Completion Date (as defined in the Loan Agreement) or at such other times
as may be prescribed in the Income Tax Regulations promulgated under Section 142(d)(7) of
the Code.
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