To amend sections 175.01 and 175.04 and to enact sections 175.30 to 175.35 of the Revised Code to create the Grants for Grads Program.

Section 1. That sections 175.01 and 175.04 be amended and sections 175.30, 175.31, 175.32, 175.33, 175.34, and 175.35 of the Revised Code be enacted to read as follows:

Sec. 175.01. As used in this chapter sections 175.01 to 175.13 of the Revised Code:

(A) "Bonds" means bonds, notes, debentures, refunding bonds, refunding notes, and other obligations.

(B) "Financial assistance" means grants, loans, loan guarantees, an equity position in a project, and loan subsidies.

(C) "Grant" means funding for which repayment is not required.

(D) "Homeownership program" means any program for which the Ohio housing finance agency provides financing, directly or indirectly, for the purchase of housing for owner-occupancy.

(E) "Housing" means housing for owner-occupancy and multifamily rental housing.

(F) "Housing development fund" means the housing development fund created and administered pursuant to section 175.11 of the Revised Code.

(G) "Housing finance agency personal services fund" means the housing finance agency personal services fund created and administered pursuant to section 175.051 of the Revised Code.

(H) "Housing for owner-occupancy" means housing that is intended for occupancy by an owner as a principal residence. "Housing for owner-occupancy" may be any type of structure and may be owned in any form of ownership.

(I) "Housing trust fund" means the low- and moderate-income housing trust fund created and administered pursuant to Chapter 174. of the Revised Code.

(J) "Improvement" means any alteration, remodeling, addition, or repair that substantially protects or improves the basic habitability or energy efficiency of housing.

(K) "Lending institution" means any financial institution qualified to conduct business in this state, a subsidiary corporation that is wholly owned by a financial institution qualified to conduct business in this state, and a mortgage lender whose regular business is originating, servicing, or brokering real estate loans and who is qualified to do business in this state.

(L) "Loan" means any extension of credit or other form of financing or indebtedness extended directly or indirectly to a borrower with the expectation that it will be repaid in accordance with the terms of the underlying loan agreement or other pertinent document. "Loan" includes financing the Ohio housing finance agency extends to lending institutions and indebtedness the agency purchases from lending institutions.

(M) "Loan guarantee" means any agreement in favor of a lending institution, bondholder, or other lender in which the credit and resources of the housing finance agency or the housing trust fund are pledged to secure the payment or collection of financing extended to a borrower for the acquisition, construction, improvement, rehabilitation, or preservation of housing or to refinance any financing previously extended for those purposes.

(N) "Loan subsidy" means any deposit of funds the Ohio housing finance agency holds or administers into a lending institution with the authorization or direction that the income or revenues the deposit earns, or could have earned at competitive rates, be applied directly or indirectly to the benefit of housing assistance or financial assistance.

(O) "Low- and moderate-income persons" means individuals and families who qualify as low- and moderate-income persons pursuant to guidelines the agency establishes.

(P) "Multifamily rental housing" means multiple unit housing intended for rental occupancy.

(Q) "Nonprofit organization" means a nonprofit organization in good standing and qualified to conduct business in this state including any corporation whose members are members of a metropolitan housing authority.

(R) "Owner" means any person who, jointly or severally, has legal or equitable title to housing together with the right to control or possess that housing. "Owner" includes a purchaser of housing pursuant to a land installment contract if that contract vests possession and maintenance responsibilities in the purchaser, and a person who has care or control of housing as executor, administrator, assignee, trustee, or guardian of the estate of the owner of that housing.

(S) "Security interest" means any lien, encumbrance, pledge, assignment, mortgage, or other form of collateral the Ohio housing finance agency holds as security for financial assistance the agency extends or a loan the agency acquires.

Sec. 175.04. (A) The governor shall appoint a chairperson from among the members of the Ohio housing finance agency. The agency members shall elect a member as vice-chairperson. The agency members may appoint other officers, who need not be members of the agency, as the agency deems necessary.

(B) Six members of the agency constitute a quorum and the affirmative vote of six members is necessary for any action the agency takes. No vacancy in agency membership impairs the right of a quorum to exercise all of the agency's rights and perform all the agency's duties. Agency meetings may be held at any place within the state. Meetings shall comply with section 121.22 of the Revised Code.

(C) The agency shall maintain accounting records in accordance with generally accepted accounting principals and other required accounting standards.

(D) The agency shall develop policies and guidelines for the administration of its programs and annually shall conduct at least one public hearing to obtain input from any interested party regarding the administration of its programs. The hearing shall be held at a time and place as the agency determines and when a quorum of the agency is present.

(E) The agency shall appoint committees and subcommittees comprised of members of the agency to handle matters it deems appropriate.

(1) The agency shall adopt an annual plan to address this state's housing needs. The agency shall appoint an annual plan committee to develop the plan and present it to the agency for consideration.

(2) The annual plan committee shall select an advisory board from a list of interested individuals the executive director provides or on its own recommendation. The advisory board shall provide input on the plan at committee meetings prior to the annual public hearing. At the public hearing, the committee shall discuss advisory board comments. The advisory board may include, but is not limited to, persons who represent state agencies, local governments, public corporations, nonprofit organizations, community development corporations, housing advocacy organizations for low- and moderate-income persons, realtors, syndicators, investors, lending institutions as recommended by a statewide banking organization, and other entities participating in the agency's programs.

Each agency program that allows for loans to be made to finance housing for owner occupancy that benefits other than low- and moderate-income households, or for loans to be made to individuals under bonds issued pursuant to division (B) of section 175.08 of the Revised Code, shall be presented to the advisory board and included in the annual plan as approved by the agency before the program's implementation.

(F) The agency shall prepare an annual financial report describing its activities during the reporting year and submit that report to the governor, the speaker of the house of representatives, and the president of the senate within three months after the end of the reporting year. The report shall include the agency's audited financial statements, prepared in accordance with generally accepted accounting principles and appropriate accounting standards.

(G) The agency shall prepare an annual report of its programs describing how the programs have met this state's housing needs. The agency shall submit the report to the governor, the speaker of the house of representatives, and the president of the senate within three months after the end of the reporting year.

(H) The agency shall prepare an annual report regarding the grants for grads program created under section 175.31 of the Revised Code describing the number and dollar amount of grants awarded, and the activities of the agency under sections 175.30 to 175.35 of the Revised Code, during the previous calendar year. The agency shall submit the report to the governor, director of development, chancellor of the Ohio board of regents, president of the senate, and speaker of the house of representatives.

Sec. 175.30. As used in sections 175.30 to 175.35 of the Revised Code:

(A) "First home" or "home" means the first residential real property located in this state to be purchased by a grantee who has not owned or had an ownership interest in a principal residence in the three years prior to the purchase.

(B) "Graduate" means an individual who has graduated from an institution of higher education and who is eligible under division (B) of section 175.31 of the Revised Code to apply for a grant awarded under the grants for grads program.

(C) "Grant" means a cash payment awarded to a grantee by the Ohio housing finance agency under section 175.32 of the Revised Code.

(D) "Grantee" means an individual who has been awarded a grant under the program.

(E) "Institution of higher education" means a state university or college located in this state, a private college or university located in this state that possesses a certificate of authorization issued by the Ohio board of regents under Chapter 1713. of the Revised Code, or an accredited college or university located outside this state that is accredited by an accrediting organization or professional accrediting association recognized by the Ohio board of regents.

(F) "Ohio resident" means any of the following:

(1) An individual who was a resident of this state at the time of the individual's graduation from an Ohio public or nonpublic high school that is approved by the state board of education, and who is a resident of this state at the time of applying for the program;

(2) An individual who was a resident of this state at the time of completing, through the twelfth-grade level, a home study program approved by the state board of education, and who is a resident of this state at the time of applying for the program;

(3) An individual whose parent was a resident of this state at the time of the individual's graduation from high school, and who graduated from either of the following:

(a) An out-of-state high school that was accredited by a regional accrediting organization recognized by the United States department of education and met standards at least equivalent to those adopted by the state board of education for approval of nonpublic schools in this state;

(b) A high school approved by the United States department of defense.

(G) "Program" means the grants for grads program created under section 175.31 of the Revised Code.

Sec. 175.31. (A) There is hereby created the grants for grads program for the purpose of providing grants to Ohio residents who have received an associate, baccalaureate, master's, doctoral, or other postgraduate degree, which grants shall be used by a grantee to pay for the down payment or closing costs on the purchase of a first home. The program shall be administered by the Ohio housing finance agency using moneys available to it. Participation in the program shall require a graduate to be eligible under division (B) of this section and to file an application for the grant in accordance with division (C) of this section.

(B)(1) A graduate is eligible to participate in the program if the graduate:

(a) Is an Ohio resident who has received an associate, baccalaureate, master's, doctoral, or other postgraduate degree from an institution of higher education;

(b) Is able to provide to the agency evidence documenting the graduate's Ohio residency and documenting graduation from a high school and an institution of higher education;

(c) Intends to live and work in this state for at least five years after the graduate's graduation or completion of a degree described in division (B)(1)(a) of this section; and

(d) Intends to purchase a first home in this state.

(2) Married graduates may both apply for grants under the program and both graduates, if eligible, shall be included in the lottery pool under section 175.32 of the Revised Code.

(3) A graduate who is married to an individual who has previously received a grant under the program is ineligible to apply for a grant under this section.

(C) A graduate who is eligible under division (B) of this section to participate in the program shall file an application with the Ohio housing finance agency not later than the sixtieth day after the graduate's graduation date or date of completion of a degree described in division (B)(1)(a) of this section, except that for purposes of the initial lottery conducted under the program, a graduate is eligible to file an application if the graduate's graduation date or date of completion of a degree occurs on or after January 1, 2008. Married graduates who both are eligible for a grant under the program shall apply individually. The agency shall provide for the content and format of the application. A graduate who files an application under this division is ineligible to file an application for a grant in any other six-month period.

(D) The application shall include information as determined by rule of the Ohio housing finance agency under section 175.34 of the Revised Code, but at a minimum shall include evidence of meeting the requirements in division (B) of this section.

(E) A graduate who, at any time during the period from filing the application for a grant until a grant is awarded, has been found by the state to be delinquent in the payment of individual income taxes is ineligible to receive a grant under the program.

Sec. 175.32. (A) After selecting graduates pursuant to division (B) of this section, the Ohio housing finance agency shall review each application selected for compliance and accuracy, and shall determine whether a graduate is eligible to receive a grant and the amount thereof, based on the information provided to the agency in the application. An application found by the agency to be insufficient may be resubmitted by the selected graduate within sixty days. If the application is not resubmitted or the resubmitted application is found to be insufficient, the selected graduate shall not receive a grant.

(B)(1) Grants shall be provided from moneys in the grants for grads fund. A grant shall be given to a graduate whose application has been determined by the agency to meet the requirements of section 175.31 of the Revised Code and to be timely and complete, and who has been selected as one of one hundred fifty grantees in a random lottery conducted by the agency twice a year, by the thirty-first day of January and by the thirty-first day of July of each year. The lottery pool shall include all graduate applicants who have filed applications within the six months immediately preceding the date on which the lottery is conducted. In addition, fifty alternate grantees shall be selected in the random lottery to receive any additional moneys available in the grants for grads fund after grants are awarded to the eligible grantees first selected for that six-month period. The alternate grantees shall receive grants in the order they were selected in the lottery until moneys for the six-month period are exhausted.

(2) If there are less than one hundred fifty applicants for grants in a given six-month period, the lottery shall be dispensed with and all applicants the agency determines under this section to be eligible for grants shall be awarded grants.

(C) The awarding of a grant shall be evidenced by written notification to the grantee, which notification shall clearly state the amount of the grant and the starting and ending dates of the award period. The agency shall provide the notification to selected grantees within sixty days after completion of the lottery. The award period shall be from the start date through the last day of the twenty-fourth month thereafter.

(D) The amount of each grant awarded to a grantee who received a notification under division (C) of this section shall be as follows:

(1) For a grantee who received an associate degree, two thousand five hundred dollars;

(2) For a grantee who received a baccalaureate degree, five thousand dollars;

(3) For a grantee who received a post-graduate degree, ten thousand dollars.

(E) The grant shall be provided to the grantee as a cash payment when the grantee obtains a mortgage loan, and the amount of the cash payment shall be applied in full only to pay all or a portion of the closing costs or down payment on the purchase of the grantee's first home. The grantee shall not receive any cash back at the time of the closing. The grantee must take receipt of the grant within the award period designated in the notification, and must use it within twenty-four months after taking receipt of the grant, after which the grant shall expire.

Sec. 175.33. (A)(1) At the time a first home is purchased under the program, the Ohio housing finance agency shall secure the amount of the grant by a lien on the home for a period of five years. Such lien shall attach, and may be perfected, collected, and enforced in the same manner as a mortgage lien on the home, and shall otherwise have the same force and effect as a mortgage lien, except that it shall be subordinate to a mortgage lien securing any money loaned by a financial institution for the purchase of the home.

(2) If the agency finds that a grantee failed to comply with the first home ownership criteria in division (A) of section 175.30 of the Revised Code, or otherwise applied for a grant using fraudulent information, the agency shall enforce the lien.

(B)(1) If a grantee becomes a resident of another state and does not reside at least five years in a first home purchased with a grant awarded under the program, the amount of the lien created in division (A) of this section that may be collected shall be determined as follows:

The lien created under division (A) of this section shall be extinguished upon collection pursuant to this division.

(2) A lien created under division (A)(1) of this section shall be extinguished if the grantee, within the five-year period, moves to another residence located in this state.

Sec. 175.34. (A) The Ohio housing finance agency shall adopt rules under Chapter 119. of the Revised Code to carry out the purposes of the grants for grads program.

(B) The agency shall internally audit the program and the grants for grads fund before the beginning of each calendar year. At the end of each calendar year, the agency shall prepare and submit an annual report to the advisory board created pursuant to section 175.04 of the Revised Code, specifying the internal audit work completed by the end of that calendar year and reporting on compliance with the annual internal audit program.

Sec. 175.35. There is hereby created in the state treasury the grants for grads fund. The fund shall consist of all appropriations made to the fund and grants, gifts, and contributions of money made from any source to the Ohio housing finance agency for deposit in the fund. The fund shall be administered by the agency and is for use in providing grants to graduates participating in, and for implementing and administering, the program. Moneys in the fund shall be invested by the treasurer of state in the same manner as moneys in the general revenue fund, and earnings on the investments of the fund shall be deposited into the fund.

Section 2. That existing sections 175.01 and 175.04 of the Revised Code are hereby repealed.