limited equity cooperative housing
(9) Treatment of limited equity cooperative housing (A) Treatment as residential rental property Except as provided in subparagraph (B), for purposes of this part— (i) any limited equity cooperative housing shall be treated as residential rental property and not as owner-occupied housing, and (ii) bonds issued to provide such housing shall be subject to the same requirements and limitations as bonds the proceeds of which are to be used to provide qualified residential rental projects (as defined in section 142(d) ). (B) Bonds subject to qualified mortgage bond termination date Subparagraph (A) shall not apply to any bond issued after the date specified in subsection (a)(1)(B). (C) Limited equity cooperative housing For purposes of this paragraph, the term “limited equity cooperative housing” means any dwelling unit which a person is entitled to occupy by reason of his ownership of stock in a qualified cooperative housing corporation. (D) Qualified cooperative housing corporation For purposes of this paragraph, the term “qualified cooperative housing corporation” means any cooperative housing corporation (as defined in section 216(b)(1) ) if— (i) the consideration paid for stock held by any stockholder entitled to occupy any house or apartment in a building owned or leased by the corporation may not exceed the sum of— (I) the consideration paid for such stock by the first such stockholder, as adjusted by a cost-of-living adjustment determined by the Secretary, (II) payments made by any stockholder for improvements to such house or apartment, and (III) payments (other than amounts taken into account under subclause (I) or (II)) attributable to any stockholder to amortize the principal of the corporation’s indebtedness arising from the acquisition or development of real property, including improvements thereof, (ii) the value of the corporation’s assets (reduced by any corporate liabilities), to the extent such value exceeds the combined transfer values of the outstanding corporate stock, shall be used only for public benefit or charitable purposes, or directly to benefit the corporation itself, and shall not be used directly to benefit any stockholder, and (iii) at the time of issuance of the issue, such corporation makes an election under this paragraph. (E) Effect of election If a cooperative housing corporation makes an election under this paragraph, section 216 shall not apply with respect to such corporation (or any successor thereof) during the qualified project period (as defined in section 142(d)(2)). (F) Corporation must continue to be qualified cooperative Subparagraph (A)(i) shall not apply to limited equity cooperative housing unless the cooperative housing corporation continues to be a qualified cooperative housing corporation at all times during the qualified project period (as defined in section 142(d)(2) ). (G) Election irrevocable Any election under this paragraph, once made, shall be irrevocable.