24 C.F.R. § 246.6

Initiation

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When a mortgagor determines that the permitted increase in rents as prescribed by the board will not provide a rent level necessary to maintain and operate adequately the project, and the mortgagor elects to request preemption under this subpart, it shall:

(a) File an application for whatever relief or redetermination is permitted under the State or local law and;

(b) Notify: (1) The tenants in accordance with § 246.7 of this subpart, (2) the appropriate HUD office pursuant to § 246.8, and (3) the board of the mortgagor's intention to file a request for preemption of local rent control regulation pursuant to the provisions of regulations in this subpart. This action may be taken if either the board's written decision is unacceptable to the mortgagor or no written decision is received from the board within 30 days of the mortgagor's request under paragraph (a) of this section.

Notes of Decisions
Cited in 3 cases, 1985–1991 · leading case: Rent Control Bd. of Cambridge v. Cambridge Tower Corp., 477 N.E.2d 1011 (Mass. 1985).
Rent Control Bd. of Cambridge v. Cambridge Tower Corp., 477 N.E.2d 1011 (Mass. 1985). “6 ( 24 C.F.R. § 246.6 [1984]) provides for the preemption of local rent control on a case by case basis on HUD’s approval of a request of a mortgagor who determines that the rents “as prescribed by the [local] board will not provide a rent level necessary to maintain and operate…”
Rent Control Bd. v. 375 Assocs. Ltd. P'ship, 488 N.E.2d 754 (Mass. 1986). “24 C.F.R. § 246.6 (a), (b) (1985). 5 After suit was filed, the defendant sought National Housing Act preemption, 6 even though the board granted an increase (less than that which was sought).”
Sea Castle Apts., Ltd. v. Santa Monica Rent Control Bd., 91 Cal. Daily Op. Serv. 2490 (Cal. Ct. App. 1991). “Preemption will be granted only if it is determined that the rental rates permitted under local law “prevent[] the mortgagor from achieving a level of residential income necessary to maintain and operate adequately the project, which includes sufficient funds to meet the…”
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