Section 24-1-6

Establishment of rentals and tenant selection in low rent housing projects.

(a) It is declared to be the policy of this state that each housing authority shall manage and operate its low rent housing projects in an efficient manner so as to enable it to fix the rentals for dwelling accommodations at the lowest possible rates consistent with its providing decent, safe, and sanitary dwelling accommodations for persons of low income, and that no housing authority shall construct or operate any such project for profit, or as a source of revenue of the city or town. To this end a housing authority shall fix the rentals for such dwellings in its low rent housing projects at no higher rates than it shall find to be necessary in order to produce revenues which, together with all other available moneys, revenues, income, and receipts of such authority from whatever sources derived, including federal financial assistance necessary to maintain the low rent character of the projects, will be sufficient:

(1) To pay, as the same become due, the principal and interest on the bonds or other obligations of such authority;

(2) To meet the cost of, and to provide for, maintaining and operating the projects, including the cost of any insurance, and the administrative expenses of such authority;

(3) To meet the cost of discharging all lawful obligations assumed by or imposed upon the authority or its property; and

(4) To create, during not less than the six years immediately succeeding its issuance of any bonds or other obligations, a reserve sufficient to meet the largest principal and interest payments which will be due on such bonds or other obligations in any one year thereafter and to maintain such reserve.

(b) Rentals or payments for such dwellings shall be established and the low rent housing projects administered, insofar as possible, so as to assure that any federal financial assistance required shall be strictly limited to amounts and periods necessary to maintain the low rent character of the projects.

(c) In the operation or management of such low rent housing projects, a housing authority shall at all times observe the following duties with respect to rentals and tenant selection:

(1) It may rent or lease the dwelling accommodations therein only to persons who lack the amount of income which is necessary, as determined by the housing authority undertaking the housing project, to enable them, without financial assistance, to live in decent, safe, and sanitary dwellings, without overcrowding;

(2) It may rent or lease the dwelling accommodations only at rentals within the financial reach of such persons;

(3) It may rent or lease to a tenant dwelling accommodations consisting of the number of rooms, but no greater number, which it deems necessary to provide safe and sanitary accommodations to the proposed occupants thereof, without overcrowding; and

(4) It shall not accept any person as a tenant in any such low rent housing project if the person or persons who would occupy the dwelling accommodations have, at the time of admission, an aggregate annual net income, less an exemption of $100.00 for each minor member of the family other than the head of the family and his spouse, in excess of five times the annual rental of the quarters to be furnished such person or persons.

In computing the rental for this purpose of selecting tenants, there shall be included in the rental the average annual cost, as determined by the housing authority, to occupants of heat, water, electricity, gas, a cooking range and other necessary services or facilities, whether or not the charge for such services and facilities is in fact included in the rental; provided, that an authority may agree to conditions as to tenant eligibility or preference required by the federal government pursuant to federal law in any contract for financial assistance with the authority.

(d) Nothing contained in this section shall be construed as limiting the power of an authority to vest in an obligee the right, in the event of a default by the housing authority, to take possession of a housing project or cause the appointment of a receiver thereof, free from all the restrictions imposed by this section with respect to rental rates and tenant selection.

(Acts 1939, No. 614, p. 981, §1; Code 1940, T. 25, §87; Acts 1955, No. 554, p. 1215.)