To amend the Internal Revenue Code of 1986 to provide for a temporary ex-offender low-income housing credit to encourage the provision of housing, job training, and other essential services to ex-offenders through a structured living environment designed to assist the ex-offenders in becoming self-sufficient.

Summary: Public Safety Ex-Offender Self-Sufficiency Act of 2002 - Amends the Internal Revenue Code to establish, as general business credit, a temporary ex-offender low-income housing credit for housing provided to qualified ex-offenders in a qualified ex-offender residential building providing a required ex-offender support services program.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Public Safety Ex-Offender Self-
Sufficiency Act of 2002''.

SEC. 2. TEMPORARY EX-OFFENDER LOW-INCOME HOUSING CREDIT.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by adding at the end 
the following new section:

``SEC. 45G. EX-OFFENDER LOW-INCOME HOUSING CREDIT.

    ``(a) In General.--For purposes of section 38, the amount of the 
ex-offender low-income housing credit determined under this section for 
any taxable year in the credit period shall be an amount equal to--
            ``(1) the applicable percentage of
            ``(2) the qualified basis of each qualified ex-offender 
        residential building.
    ``(b) Applicable Percentage.--In the case of any qualified ex-
offender residential building, the term `applicable percentage' has the 
meaning given such term in section 42(b)(2) with respect to qualified 
low-income buildings, except that, for the purposes of this subsection, 
the percentages prescribed by the Secretary under section 42(b)(2)(B) 
shall yield amounts of credit which have a present value equal to 70 
percent of the qualified basis of any qualified ex-offender residential 
building.
    ``(c) Qualified Basis.--
            ``(1) In general.--For purposes of subsection (a) and 
        except as otherwise provided in this subsection, the term 
        `qualified basis' means the adjusted basis of a qualified ex-
        offender residential building as of the close of the 1st 
        taxable year of the credit period.
            ``(2) Qualified basis to include portion of building used 
        to provide ex-offender support services.--The qualified basis 
        of any qualified ex-offender residential building for any 
        taxable year shall be increased by the lesser of--
                    ``(A) so much of the qualified basis of such 
                building as is used throughout the year to provide ex-
                offender support services, or
                    ``(B) 20 percent of the qualified basis of such 
                building (determined without regard to this paragraph).
            ``(3) Special rules.--Rules similar to the rules of 
        paragraphs (4), (5) (other than subparagraph (A) thereof), and 
        (7) of section 42(d) shall apply in determining the adjusted 
        basis of any qualified ex-offender residential building.
    ``(d) Rehabilitation Expenditures.--Rules similar to the rules of 
section 42(e) shall apply in determining the treatment of 
rehabilitation expenditures paid or incurred by the taxpayer with 
respect to a qualified ex-offender residential building.
    ``(e) Credit Period.--For purposes of this section, rules similar 
to the rules of section 42(f) shall apply in determining the credit 
period with respect to any qualified ex-offender residential building.
    ``(f) Qualified Ex-Offender Residential Building.--For purposes of 
this section, the term `qualified ex-offender residential building' 
means any building which, at all times during the compliance period, 
meets the following requirements:
            ``(1) Single occupancy ex-offender residential units.--Each 
        residential unit in such building may be made available for 
        occupancy to not more than 1 individual. Such individual must 
        be an ex-offender who--
                    ``(A) meets the residency requirements under 
                subsection (g);
                    ``(B) has failed to meet such requirements for 
                fewer than 14 days; or
                    ``(C) is in the process of being evicted from such 
                building for failing to meet such requirements.
        ``A building shall not be determined to fail to satisfy the 
        requirements of this paragraph solely because some or all of 
        the residential units in such building are single room 
        occupancy (as defined in section (8)(n) of the United States 
        Housing Act of 1937 (42 U.S.C. 1437f(n))).
            ``(2) Self-sufficiency centers for ex-offenders.--The 
        building shall include a self-sufficiency center for ex-
        offenders that--
                    ``(A) is specifically designed to accommodate, and 
                reserved for, the provision of ex-offender support 
                services to residents of the facility and other ex-
                offenders;
                    ``(B) is made available for rental by providers of 
                such services at a rate determined by the owner of the 
                facility; and
                    ``(C) provides an array of such services sufficient 
                to meet a significant portion of the needs of ex-
                offenders for ex-offender support services.
            ``(3) Rent limitations.--The portion of the monthly rent 
        payable by the occupant of each unit in the building may not 
        exceed 30 percent of the adjusted monthly income (as such term 
        is defined in section 3(b) of the United States Housing Act of 
        1937 (42 U.S.C. 1437a(b)) of the occupant.
    ``(g) Residency Requirements.--
            ``(1) In general.--An ex-offender meets the residency 
        requirements for a qualified ex-offender residential building 
        if such ex-offender--
                    ``(A) has a low income;
                    ``(B) is participating in an ex-offender support 
                services program as described in paragraph (3)(B);
                    ``(C) has not been prohibited from residency under 
                paragraph (4); and
                    ``(D) commences occupancy of a unit in a qualified 
                ex-offender residential building on a date that is not 
                later than--
                            ``(i) in the case of an ex-offender who has 
                        been discharged from prison, jail, a half-way 
                        house, or any other correctional facility, 12 
                        months after such discharge; or
                            ``(ii) in the case of any ex-offender whose 
                        sentence did not include confinement to a 
                        correctional facility, 12 months after the date 
                        of the ex-offender's conviction.
            ``(2) Low-income.--For purposes of this section, an ex-
        offender is considered to have a low income if, at the 
        commencement of the ex-offender's occupancy of a residential 
        unit, the income (if any) of the ex-offender does not exceed 60 
        percent of area median gross income (as determined consistent 
        with section 8 of the United States Housing Act of 1937).
            ``(3) Participation in ex-offender support services 
        program.--
                    ``(A) Program.--For purposes of this section, an 
                ex-offender support services program is a program for 
                the provision of specific ex-offender support services 
                for an ex-offender that--
                            ``(i) is created and managed by a 
                        coordinating individual or entity having 
                        education, training, and experience with ex-
                        offenders and their support services needs;
                            ``(ii) is specifically designed to meet the 
                        needs of the particular ex-offender for ex-
                        offender support services;
                            ``(iii) sets forth a specific duration over 
                        which the ex-offender support services are to 
                        be provided and goals by which to assess the 
                        progress of the ex-offender; and
                            ``(iv) provides for continual oversight to 
                        monitor the progress and needs of the ex-
                        offender and to ensure that the ex-offender is 
                        being provided the appropriate ex-offender 
                        support services and is complying with the 
                        requirements of the program.
                    ``(B) Participation.--For purposes of this section, 
                an ex-offender is considered to be participating in an 
                ex-offender support services program if the ex-
                offender--
                            ``(i) has entered into a written agreement 
                        with the coordinator for the program that--
                                    ``(I) sets forth the ex-offender 
                                support services that are appropriate 
                                for, and will be made available to, the 
                                ex-offender and the duration of the 
                                program for the ex-offender; and
                                    ``(II) provides that the ex-
                                offender's continued attendance at 
                                scheduled program meetings and events 
                                and obtaining of program services are a 
                                condition of the ex-offender's 
                                continued residency in the facility; 
                                and
                            ``(ii) is not in default with regard to the 
                        ex-offender's obligations under such agreement.
                    ``(C) Ex-offender support services.--For purposes 
                of this section, the term `ex-offender support 
                services' means services that assist ex-offenders to 
                develop skills necessary for life outside of the 
                environment of a correctional institution, and 
                includes--
                            ``(i) job training;
                            ``(ii) employment counseling and placement;
                            ``(iii) entrepreneurial training;
                            ``(iv) financial management training;
                            ``(v) homeownership and rental counseling;
                            ``(vi) drug and alcohol abuse counseling;
                            ``(vii) self-esteem and peer development 
                        assistance;
                            ``(viii) anger management counseling;
                            ``(ix) health care services, including 
                        mental health services and behavioral 
                        counseling;
                            ``(x) probation services;
                            ``(xi) family and crisis management 
                        counseling; and
                            ``(xii) general educational assistance and 
                        counseling.
            ``(4) Limitation on term of residency.--An ex-offender may 
        not reside in an ex-offender residential facility at any time 
        after the expiration of the 2-year period beginning upon the 
        commencement of the ex-offender's occupancy in the ex-offender 
        residential facility.
    ``(h) Ex-Offender.--For purposes of this section, the term `ex-
offender' means any individual who has been convicted of a felony under 
State or Federal law.
    ``(i) Allocation and Determination of Credit.--
            ``(1) In general.--Except as otherwise provided in this 
        subsection, rules similar to the rules of section 42(h) (other 
        than subparagraphs (E) and (F) of paragraph (1) thereof) shall 
        apply with respect to allocating and determining any credit 
        under this section.
            ``(2) State housing credit ceiling.--For purposes of this 
        section:
                    ``(A) In general.--The State housing credit ceiling 
                shall be calculated by substituting the amount 
                determined under section 42(h)(3)(C)(ii) with the 
                greater of--
                            ``(i) $85,000,000 multiplied by the State 
                        ratio, or
                            ``(ii) $500,000.
                    ``(B) Termination.--The State housing credit 
                ceiling applicable to any State for any calendar year 
                beginning after December 31, 2007, shall be zero.
                    ``(C) State ratio.--The State ratio for any State 
                is equal to--
                            ``(i) the reported number of sentenced 
                        prisoners released from State or Federal 
                        jurisdiction in such State during the most 
                        recent year for which information is available, 
                        divided by
                            ``(ii) the reported number of sentenced 
                        prisoners released from State or Federal 
                        jurisdiction in the United States during the 
                        most recent year for which information is 
                        available.
                    ``(D) Reported number of sentenced prisoners.--The 
                reported number of sentenced prisoners is the number of 
                such prisoners reported to the Attorney General by the 
                National Prison Statistics Program.
            ``(3) Involvement of qualified non-profit organizations.--
        For purposes of this section, section 42(h)(5)(A) shall be 
        applied by substituting `0' for `90'.
    ``(j) Recapture of Credit.--Rules similar to the rules of 
subsections (i)(1) and (j) of section 42 shall apply for purposes of 
this section.
    ``(k) Application of At-Risk Rules.--Rules similar to the rules of 
section 42(k) shall apply for purposes of this section.
    ``(l) Certification and Other Reports to Secretary.--Subject to 
such regulations as the Secretary may prescribe, rules similar to the 
rules of section 42(l) shall apply for purposes of this section.
    ``(m) Responsibilities of the Secretary and Housing Credit 
Agencies.--Rules similar to the rules of subsections (m) and (n) of 
section 42 shall apply for purposes of this section.''.
    (b) Inclusion as Current Year Business Credit.--Section 38(b) of 
the Internal Revenue Code of 1986 is amended by adding at the end the 
following new paragraph:
            ``(13) the ex-offender low-income housing credit under 
        section 45G(a).''.
    (c) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by adding at the end the following new item:

                              ``Sec. 45G. Ex-offender low-income 
                                        housing credit.''.
    (d) Effective Date.--The amendments made by this section shall 
apply with respect to qualified ex-offender residential buildings 
placed in service during taxable years beginning after December 31, 
2002.