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San Francisco

San Francisco’s Assisted Housing Preservation Ordinance (S.F., CAL., ADMIN. CODE §§ 60.1-14) gives the city, tenant associations and affiliated nonprofit groups the equivalent of a right of first refusal when an owner proposes to sell or transfer any HUD-subsidized housing. A proposed prepayment or Section 8 contract termination triggers other procedures and protections, whereas a Section 8 contract expiration or opt-out at its original expiration date triggers no purchase rights. The ordinance requires 18-months’ notice of prepayments or mid-term Section 8 terminations, and 12-months’ notice of Section 8 contract expirations at the end of their term. Information about tenants’ rights must be made available to any interested parties at least 14 days prior to a required public hearing, which is held no later than 45 days after the owner gives notice of intent to prepay or terminate prematurely. The ordinance also uses a complex formula to reach a “fair return price” that may not exceed the appraised value based on the highest and best use, creates civil remedies for violations and provides that owners pay relocation fees of up to $5,250 to very low-, low- or moderate-income tenants who are displaced by a conversion, according to a set formula.

The San Francisco Rent Ordinance (S.F., CAL., ADMIN. CODE §§ 37.1-15) also provides generally applicable rent increase limits and eviction protections. The Rent Ordinance generally does not apply to “dwelling units whose rents are controlled or regulated by any government unit, agency or authority, excepting those unsubsidized and/or unassisted units which are insured by the United States Department of Housing and Urban Development.” However, upon the expiration or termination of Section 8 project-based HAP contracts, the units would come under the scope of the Rent Ordinance and the base rent is set at the contract rent immediately in effect prior to expiration or termination. Likewise, upon the prepayment or expiration of a HUD-insured mortgage, the units become subject to the ordinance and the base rent is set to equal the basic rental charge in effect immediately prior to prepayment or expiration. The Rent Ordinance only applies to buildings for which a certificate of occupancy was issued before June 13, 1979.

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