(1) In the operation or management of housing projects an authority shall at all times observe the following duties with respect to rentals and tenant selection:
(a) It may rent or lease the dwelling accommodations therein only to persons of low income and at rentals within the financial reach of such persons of low income.
(b) It may rent or lease to a tenant dwelling accommodations consisting of the number of rooms, but no greater number, which it deems necessary to provide safe and sanitary accommodations to the proposed occupants thereof, without overcrowding.
(c) It shall accept any person as a tenant in any housing project according to the appropriate guidelines as established by the United States Department of Housing and Urban Development or other federal agencies.
(d) The Department of Children and Family Services, pursuant to 45 C.F.R. s. 233.20(a)(3)(vii)(c), may not consider as income for recipients of temporary cash assistance any assistance received by recipients from other agencies or organizations such as public housing authorities. (2) Nothing contained in this section or s. 421.09 shall be construed as limiting the power of an authority to vest in an obligee the right, in the event of a default by the authority, to take possession of a housing project or cause the appointment of a receiver thereof, free from all the restrictions imposed by this section or s. 421.09.
(3) This section shall not apply to housing facilities financed by loans made for the purpose of providing such facilities for domestic farm labor pursuant to s. 514 of the Federal Housing Act of 1949.