State Agencies

HOUSING AND COMMUNITY
DEVELOPMENT

Ardath M. Cade, Assistant Secretary for Housing
and Community Development

2525 Riva Road
Annapolis 21401 Telephone: 269-2468

The office of the Assistant Secretary for Hous-
ing and Community Development oversees and
coordinates the following four divisions in the
Department of Economic and Community Devel-
opment that provide housing finance and mort-
gage services, building code and energy utilization
regulation, general community development sup-
port to local governments, and oversight of state
historical and cultural agencies: Codes Adminis-
tration; Community Development Administra-
tion; Division of Local and Regional Develop-
ment; and Maryland Housing Fund.

COMMUNITY DEVELOPMENT
ADMINISTRATION

Trudy McFall, Director

2525 Riva Road
Annapolis 21401 Telephone: 269-3161

The Community Development Administration
(CDA), Maryland's housing finance agency, was
created by Chapter 527, Acts of 1970, as part of
the Department of Economic and Community
Development. The legislation that created CDA
resulted from a recognition of a Statewide short-
age of available housing. As the State's housing
finance agency, CDA's mandate is to increase the
supply of housing for families of limited incomes,
the elderly and the handicapped, as well as to
foster sound community development and stimu-
late the construction industry Statewide (Code
1957, Art. 41, secs. 257L(a)-(g), 266DD 1-8,
266FF 1-4).

To achieve its mandate, CDA uses a variety of
programs and funding techniques. Programs are
funded by the sale of tax-exempt revenue bonds
and construction loans notes, and State general
obligation bonds, and by federal housing subsidies.

Projects financed by the Department of Eco-
nomic and Community Development must be
consistent with local priorities and must comple-
ment and supplement local community develop-
ment programs and initiatives. Projects must
meet eligibility criteria and financing require-
ments, and income limits are established as the
guideline for persons served (Code 1957, Art. 41,
secs. 257L, 266DD-1 to 266DD-8 and 266FF-1
to 266FF-4).

Economic and Community Development/ 171

SINGLE-FAMILY PROGRAMS

The Maryland Home Financing Program
(MHFP) is the oldest of the three single-family
programs supervised by the Community Develop-
ment Administration. The program was autho-
rized by the General Assembly in 1972 and first
funded with the sale of State General Obligation
Bonds in 1973. This direct-loan program expands
homeownership opportunities for low income
Marylanders. It differs from the other single-fami-
ly programs by virtue of its funding source: Gen-
eral Obligation Bonds and appropriations, and a
revolving fund from prior loans under the pro-
gram. MHFP is administered through outreach
agents located in each major political subdivision
in the State. Loans have been made in every
county and the City of Baltimore.

The last opening of MHFP was in August
1981. A lottery was devised to determine the pro-
cessing order for applications submitted directly
to the Community Development Administration.
Over 90 percent of the homes financed by MHFP
have been existing properties rather than newly
constructed homes (Code 1957, Art. 41, sec.
266FF; Code Financial Institutions Article, sec.
13-310).

The Homeownership Development Program
(HDP), like the Maryland Home Financing Pro-
gram, is a direct loan program. First funded in
April 1979, it is the only single-family program
geared to stimulate new housing construction.
HDP is funded through the sale of tax-exempt
revenue bonds. Funds are designated for newly
constructed homes in approved subdivisions.
Only a portion of the homes in each subdivision
are assigned for CDA financing—an average of
31 percent. The rest of the units must use private
financing. In this way an income mix is achieved
in the development.

Using the guidelines of the Mortgage Subsidy
Bond Tax Act of 1980, the Community Develop-
ment Administration sets maximum income limits
for participants in the Homeownership Develop-
ment Program. Sales price limits are also set by
CDA. They are based on both affordability with-
in the income limits and the interest rate for the
revenue bonds. Loans are given on a first-come,
first-served basis (Code 1957, Art.41, sec.
266DD).

Established in 1980, the Mortgage Purchase
Program (MPP) was implemented in response to
dwindling mortgage funds available through pri-
vate lending institutions and rising mortgage
rates. The MPP is the only single-family program
that makes mortgage loans through participating
lending institutions. In this program, CDA pur-