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1. Establishing Initial Rents: The Agency shall establish a rent schedule for the HOME- <br /> Assisted Units in the Project that complies with the HUD established HOME rent limit <br /> affordability requirements of 24 CFR Section 92.252. The maximum HOME rent limits <br /> are recalculated on a periodic basis after HUD determines fair market rents and <br /> median incomes. The Agency shall provide to the City for its review and approval, a <br /> rent schedule for the Property that does not exceed the current HUD established <br /> HOME rent limits, and that identifies the monthly allowances for tenant paid utilities <br /> and services (excluding telephone), prior to the commencement of marketing or initial <br /> occupancy. <br /> Current HOME Rent Limits can be found at: <br /> https://www.hudexchange.info/manage-a-program/home-rent-limits/ <br /> From the date of Occupancy for the Project, the Agency shall charge only those rents <br /> approved by the City and established pursuant to federal, state and HOME Program <br /> statutes and regulations; provided that in no event will such rents exceed the maximum <br /> rent permitted under Internal Revenue Code Section 42 and the regulations <br /> thereunder. <br /> In determining maximum allowable rents and utility allowances, the Agency shall <br /> comply with the 2013 HOME Final Rules issued by HUD, and referenced in the Rules <br /> and Regulations in the Federal Register, Vol. 78, No. 142, July 24, 2013. <br /> Maximum Rents for tenants of the HOME-Assisted units shall not exceed thirty percent <br /> (30%) of the income of the target population as stated in Exhibit A. Maximum rents are <br /> determined by the number of bedrooms in each unit minus the monthly allowance for <br /> utilities (excluding telephone, cable television and other telecommunications), paid by <br /> the tenant. <br /> 2. HOME-Assisted Unit Rent Increases, and Utility Allowances. Agency shall submit, at <br /> least annually, proposed changes in rents for HOME-assisted units, along with <br /> supporting utility allowance documentation, for approval by the City, in a form <br /> acceptable to the City. <br /> 3. Maximum Rents with Federal or State Rent Subsidy Programs: If the HOME-Assisted <br /> Unit or the City Assisted Unit receives Federal or State project-based rental subsidy <br /> and the very low-income family pays as a contribution toward rent not more than 30 <br /> percent of the family's adjusted income, then the maximum rent (i.e., tenant <br /> contribution plus project-based rental subsidy) is the rent allowable under the Federal <br /> or State project-based rental subsidy program. <br /> 4. Rent Increases: Subject to the provisions of Section I.G of the Loan Agreement, rents <br /> may be increased to cover reasonable increases in operating costs, including property <br /> management, repair and maintenance, necessary services, project reserves, debt <br /> service costs, and other reasonable expenses. The HOME-Assisted Unit rents must <br /> not exceed the then-established HOME maximum rents in effect, as may be revised <br /> by HUD after HUD determines fair market rents and median incomes. The Agency <br /> shall provide to the City annually, documentation of rents and occupancy, as well as <br /> Loan Agreement <br /> Housing Hope Properties <br /> Page 19 of 51 <br />