215.090. Limited dividend approved--mortgagor's earnings limited--net earnings, how computed.
Limited dividend approved--mortgagor's earnings limited--netearnings, how computed.
215.090. With respect to an approved mortgagor which is alimited dividend corporation, the net earnings of such approvedmortgagor shall be limited to an amount not to exceed apercentage per annum established by the commission of suchapproved mortgagor's equity in a development. The equity in adevelopment shall consist of the difference between the amount ofthe mortgage loaned and the project cost or the differencebetween the mortgage as reduced by payment to principal and theproject cost. The commission shall at the time of establishingsuch percentage consider such factors as financial risk, locationof the development, proposed use of the residential facilitiesand management cost. The equity in any development may beincreased by the actual cost of capital improvements approved bythe commission and by reduction of the mortgage in payment toprincipal. Any acceleration of payment to principal shall besubject to prior approval of the commission. With respect toevery development the commission shall, pursuant to rules andregulations adopted by it, establish such approved mortgagor'sinitial equity at the time of making the final mortgage advance.Such net earnings shall be computed after deducting from grossearnings the following:
(1) All costs and expenses of maintenance and operation;
(2) Amounts paid for taxes, assessments, insurance premiumsand other similar charges;
(3) Amounts paid annually by the approved mortgagor toprincipal and interest on the mortgage note or notes thenoutstanding.
The development plan may contain provisions, satisfactory to thecommission that any surplus earnings in excess of the rate of netearnings provided in sections 215.010 to 215.250 may be held bythe corporation as a reserve for maintenance of such rate ofreturn in the future and may be used by the corporation to offsetany deficiency in such rate of return which may have occurred inprior years; or may be used to accelerate the amortizationpayments; or for the enlargement of the project; or for reductionin rentals therein; provided, that any excess of such surplusearnings remaining at the termination of the loan shall be turnedover by the corporation to the commission.
(L. 1969 H.B. 130 § 14, A.L. 1974 H.B. 1190, A.L. 1985 H.B. 484, A.L. 1989 S.B. 167)