Olbiil Era Kelulau (OEK)’s version of Housing Development Loan Program bill HB 10-108-10, HD2, SD5 was referred back with PD1 version which is expected to pass both houses of OEK today, according to sources. The bill is also expected to be signed into law this week.
President Remengesau, in his transmittal letter emphasized the collaboration between all the different leaderships and the similar objectives of seeking to provide affordable housing to Palau citizens as well as address Palau’s growing housing crisis.
“It has been clear from your discussions with our Minister of Community and Cultural Affairs, from our discussions at Joint Leadership Meetings…that our Executive and Legislative Branches share the same goals. We wish to see this money benefit all Palauans, regardless of their home state, or of their ability to access private land. And we wish to see this money benefit displaced citizens and first-time homeowners especially.”
PD1, the President’s version of bill says it sought to “streamline the bill”, “eliminate conflicts between the Executive and Legislative branches”, “eliminate potential conflicts between organizations by identifying the Palau Housing Authority (PHA) as the administrator of the Housing Development Loan Program (HDLP) “in general” and to “eliminate unintended consequence” such as avoiding implication that the entire Mega Bank Loan must be drawn-down at one time.
It also states that it seeks to “maintain government control over the government authority and resources” by making National Housing Commission (NHC) the entity to authorize draw-downs rather than National Development Bank of Palau (NDBP) or Palau Housing Authority (PHA).
House earlier passed its final version of the bill but with two memorandums citing its concerns with some of the languages within the bill. PD1 addressed those concerns raised by House of Delegates.
Under the Housing Development Loan Program, PHA lends out up to $60K per applicant, enables restructuring of previous loans under the first loan of $5M from Mega Bank at 1% or at 3% with $10k grant toward principal. PHA also may loan out funds for home extensions or renovations under “standard terms.”
Under the same program, NDBP can loan up to $100,000, for purchase of an existing home or construction of new home or construction of multi-family dwelling at 1% or at 3% with $10K grant toward initial principle or at 6% on consolidated loans with a $10K grant toward initial principal.
National Housing Commission will implement a housing a policy, coordinate with different stakeholders, authorize draw-downs of the loan and promote development of subdivisions, green communities and revival of old villages amongst other responsibilities.
Both PHA and NDBP will sign subsidiary agreement with national government and the national government will be responsible for all payments of loan principal, interests and other fees to Mega Bank for the loan.
Fees and cost of administrating the loan will be funded through government appropriations. (By L.N. Reklai)