I 

112TH CONGRESS 

2D SESSION H. R. 4218 

To preserve affordable housing opportunities for low-income families, and 

for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 20, 2012 

Ms. VELA ́ZQUEZ introduced the following bill; which was referred to the 

Committee on Financial Services 

A BILL 

To preserve affordable housing opportunities for low-income 

families, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Stabilizing Affordable 

5 Housing for the Future Act’’. 

6 SEC. 2. INVESTMENT THROUGH UP-FRONT GRANTS FROM 

7 GENERAL INSURANCE FUND. 

8 (a) 1997 ACT.—Subsection (a) of section 204 of the 

9 Departments of Veterans Affairs and Housing and Urban 

10 Development, and Independent Agencies Appropriations 


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1 Act, 1997 (12 U.S.C. 1715z–11a(a)) is amended by strik2 ing the last sentence. 

3 (b) 1978 ACT.—Paragraph (4) of section 203(f) of 

4 the Housing and Community Development Amendments 

5 of 1978 (12 U.S.C. 1701z–11(f)(4)) is amended by strik6 ing the last sentence. 

7 SEC. 3. PRESERVATION OF HUD-HELD AND HUD-OWNED 

8 BUILDINGS. 

9 Section 204(a) of the Departments of Veterans Af10 fairs and Housing and Urban Development, and Inde11 pendent Agencies Appropriations Act, 1997 (12 U.S.C. 

12 1715z–11a(a)) is amended— 

13 (1) by striking ‘‘During’’ and all that follows 

14 through ‘‘and thereafter, the provision of’’ and in15 serting ‘‘In managing and disposing of multifamily 

16 properties during any fiscal year, the Secretary may 

17 provide’’; and 

18 (2) by striking ‘‘notwithstanding any other pro19 vision’’ and inserting ‘‘consistent with other provi20 sions’’. 

21 SEC. 4. MAINTAINING AFFORDABILITY THROUGH CONTIN22 UED ASSISTANCE AND ESCROWING OF RENT23 AL ASSISTANCE. 

24 (a) REQUIREMENT TO MAINTAIN ASSISTANCE.— 

25 Subject to subsection (c) and notwithstanding any other 


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1 provision of law, in managing and disposing of any multi2 family property that is owned by, or subject to a mortgage 

3 held by, the Secretary of Housing and Urban Develop4 ment, the Secretary shall maintain payment of any rental 

5 assistance that is attached to any dwelling units in the 

6 property and provided under a contract for the property 

7 under section 8 of the United States Housing Act of 1937 

8 or under any other program administered by the Sec9 retary, as provided in this section. 

10 (b) ESCROW FOR PROPERTIES NOT MEETING HOUS11 ING QUALITY STANDARDS.—In the case of any transfer 

12 of a distressed multifamily property that does not comply 

13 with housing quality standards applicable to the property, 

14 the Secretary may not recapture any rental assistance de15 scribed in subsection (a) for the property, but shall hold 

16 any such assistance in escrow for the property during the 

17 period of noncompliance and, upon determining that the 

18 property complies with such standards make such assist19 ance available for the property. 

20 (c) PROJECTS NOT FEASIBLE FOR CONTINUED AS21 SISTANCE.—With respect to a multifamily property de22 scribed in subsection (a), to the extent the Secretary, in 

23 consultation with the tenants of the property, determines 

24 that the property is not feasible for continued rental as25 sistance payments under such section 8, or other proVerDate Mar 15 2010 02:55 Mar 21, 2012 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4218.IH H4218

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1 grams, based on consideration of the costs of rehabili2 tating and operating the property, after utilizing all avail3 able Federal, State, and local resources including rent ad4 justments under section 524 of the Multifamily Assisted 

5 Housing Reform and Affordability Act of 1997 (42 U.S.C. 

6 1437f note), the Secretary may, in consultation with the 

7 tenants of that property, contract with an owner or owners 

8 of other existing housing properties to make project-based 

9 rental assistance payments for such other properties or 

10 provide other rental assistance. 

11 SEC. 5. BUILDING ACQUISITION: VALUATION OF PHYS12 ICALLY DISTRESSED PROPERTIES SOLD BY 

13 HUD IN DISCOUNT SALES. 

14 Section 2001 of the Deficit Reduction Act of 2005 

15 (12 U.S.C. 1701z–11 note) is amended— 

16 (1) in paragraph (4), by striking ‘‘without tak17 ing into account any affordability requirements’’ and 

18 inserting the following: ‘‘as determined using indus19 try standard appraisal practices, including consider20 ation of the cost of repairs needed for the property 

21 subject to the loan to comply with minimum safety 

22 and building standards and the cost of maintaining 

23 the affordability restrictions applicable under the 

24 original loan or grant for the property’’; and 


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1 (2) in paragraph (7), by striking ‘‘without tak2 ing into account any affordability requirements’’ and 

3 inserting the following: ‘‘as determined using indus4 try standard appraisal practices, including consider5 ation of the cost of repairs needed for the property 

6 to comply with minimum safety and building stand7 ards and the cost of maintaining the affordability re8 strictions applicable under the original loan or grant 

9 for the property’’. 

10 SEC. 6. MULTIFAMILY HOUSING MORTGAGE FORE11 CLOSURE. 

12 The Multifamily Mortgage Foreclosure Act of 1981 

13 is amended— 

14 (1) in section 362 (12 U.S.C. 3701)— 

15 (A) in paragraph (5), by striking ‘‘and’’ at 

16 the end; 

17 (B) in paragraph (6), by striking the pe18 riod at the end and inserting ‘‘; and’’; and 

19 (C) by adding at the end the following new 

20 paragraph: 

21 ‘‘(7) mortgages transferred by the Secretary to 

22 State and local governments should be foreclosed in 

23 the same manner as mortgages held by the Sec24 retary.’’; 

25 (2) in section 363 (12 U.S.C. 3702)— 


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1 (A) in paragraph (9), by striking ‘‘and’’ at 

2 the end; 

3 (B) in paragraph (10), by striking the pe4 riod at the end and inserting ‘‘; and’’; and 

5 (C) by adding at the end the following new 

6 paragraph: 

7 ‘‘(11) ‘State or local government transferee’ 

8 means any state or unit of general local government, 

9 any public housing authority, or any State or local 

10 housing finance agency that has acquired mortgages 

11 pursuant to section 203 of the Housing and Commu12 nity Development Amendments of 1978 (12 U.S.C. 

13 1701z–11), section 204 of the Departments of Vet14 erans Affairs and Housing and Urban Development, 

15 and Independent Agencies Appropriations Act, 1997 

16 (12 U.S.C. 1715z–11a), or any other provision of 

17 law, that were previously held by the Secretary.’’; 

18 (3) in section 364 (12 U.S.C. 3703)— 

19 (A) by inserting ‘‘, or any State or local 

20 government transferee,’’ after ‘‘Secretary’’ the 

21 first and fourth places such term appears; and 

22 (B) by inserting ‘‘, or the State or local 

23 government transferee,’’ after ‘‘Secretary’’ the 

24 second, third, and fifth places such term ap25 pears; 


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1 (4) in section 365 (12 U.S.C. 3704)— 

2 (A) by inserting ‘‘, or any State or local 

3 government transferee,’’ after ‘‘Secretary’’ the 

4 first place such term appears; 

5 (B) by inserting ‘‘, or the State or local 

6 government transferee,’’ after ‘‘Secretary’’ each 

7 other place such term appears; and 

8 (C) by striking the last 3 sentences and in9 serting the following: ‘‘The entity designating 

10 the foreclosure commissioner, whether the Sec11 retary or any State or local government trans12 feree, shall be a guarantor of payment of any 

13 judgment against the foreclosure commissioner 

14 for damages based upon the commissioner’s 

15 failure to perform properly the commissioner’s 

16 duties. As between the entity designating the 

17 foreclosure commissioner, whether the Secretary 

18 or any State or local government transferee, 

19 and the mortgagor, the entity designating the 

20 foreclosure commissioner shall bear the risk of 

21 any financial default by the foreclosure commis22 sioner. In the event that the Secretary or any 

23 State or local government transferee makes any 

24 payment pursuant to the preceding two sen25 tences, the Secretary or any State or local govVerDate Mar 15 2010 02:55 Mar 21, 2012 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H4218.IH H4218

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1 ernment transferee shall be fully subrogated to 

2 the rights satisfied by such payment.’’; 

3 (5) in section 366 (12 U.S.C. 3705)— 

4 (A) by inserting ‘‘, or any State or local 

5 government transferee,’’ after ‘‘Secretary’’ the 

6 first, third, fourth, and fifth place such term 

7 appears; and 

8 (B) by inserting ‘‘, or the State or local 

9 government transferee,’’ after ‘‘Secretary’’ the 

10 second and sixth places such term appears; 

11 (6) in section 367 (12 U.S.C. 3706)— 

12 (A) in subsection (a)— 

13 (i) in paragraph (1), by inserting ‘‘or 

14 the State or local government transferee,’’ 

15 after ‘‘Secretary,’’; and 

16 (ii) in paragraph (8), by inserting ‘‘, 

17 or the State or local government trans18 feree’’ after ‘‘Secretary’’; 

19 (B) in subsection (b)— 

20 (i) by inserting ‘‘, or any State or 

21 local government transferee,’’ after ‘‘Sec22 retary’’ the first and second places such 

23 term appears; and 

24 (ii) by inserting ‘‘, or the State or 

25 local government transferee,’’ after ‘‘SecVerDate Mar 15 2010 02:55 Mar 21, 2012 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H4218.IH H4218

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1 retary’’ the third place such term appears; 

2 and 

3 (C) by adding at the end the following new 

4 subsection: 

5 ‘‘(c) In any case in which a State or local government 

6 transferee is the purchaser of a multifamily project, the 

7 State or local government transferee shall manage and dis8 pose of such project to benefit those originally intended 

9 to be assisted under the prior program unless continued 

10 operation and disposition of the property under such pro11 gram is not feasible based on consideration of the costs 

12 of rehabilitating and operating the property after consid13 ering all available Federal, State, and local resources, in14 cluding rent adjustments under section 524 of the Multi15 family Assisted Housing Reform and Affordability Act of 

16 1997 (42 U.S.C. 1437f note).’’; 

17 (7) in section 368 (12 U.S.C. 3707)— 

18 (A) by inserting ‘‘, or any State or local 

19 government transferee,’’ after ‘‘Secretary’’ the 

20 first and third places such term appears; and 

21 (B) by inserting ‘‘, or the State of local 

22 government transferee,’’ after ‘‘Secretary’’ the 

23 second place such term appears; 

24 (8) in section 369A (12 U.S.C. 3709)— 


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1 (A) by inserting ‘‘, or any State or local 

2 government transferee,’’ after ‘‘Secretary’’ the 

3 second place such term appears; and 

4 (B) by inserting ‘‘, or the State or local 

5 government transferee,’’ after ‘‘Secretary’’ the 

6 first, third, and fourth places such term ap7 pears; 

8 (9) in section 369B (12 U.S.C. 3710)— 

9 (A) by inserting ‘‘, or the State of local 

10 government transferee,’’ after ‘‘Secretary’’ the 

11 first and second places such term appears; and 

12 (B) by inserting ‘‘, or any State or local 

13 government transferee,’’ after ‘‘Secretary’’ each 

14 other place such term appears; 

15 (10) in section 369E (12 U.S.C. 3713), by in16 serting ‘‘, or any State or local government trans17 feree,’’ after ‘‘Secretary’’ each place such term ap18 pears; and 

19 (11) in section 369F(a)(1) (12 U.S.C. 

20 3714(a)(1)), by inserting ‘‘, or any State or local 

21 government transferee,’’ before the semicolon at the 

22 end. 


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1 SEC. 7. BUILDING TRANSFERS: REQUIREMENTS FOR PUR2 CHASERS OF FHA-INSURED PROJECTS AND 

3 SECTION 8 PROJECTS. 

4 Not later than 90 days after the date of the enact5 ment of this Act, the Secretary of Housing and Urban 

6 Development shall issue a proposed rulemaking, in accord7 ance with title 5, United States Code, that applies the par8 ticipation and certification requirements for potential pur9 chasers required under section 219 of Division G of the 

10 Consolidated Appropriations Act, 2004 (Public Law 108– 

11 199; 118 Stat. 397) and applicable to the sale of HUD12 owned multifamily housing projects and the foreclosure 

13 sale of any multifamily housing securing a mortgage held 

14 by the Secretary also to the sale of any multifamily hous15 ing having a mortgage that is insured under the National 

16 Housing Act or for which assistance is provided under sec17 tion 8 of the United States Housing Act of 1937 (42 

18 U.S.C. 1437f) under a project-based assistance contract. 

19 SEC. 8. TRANSPARENCY REGARDING BUILDING INFORMA20 TION. 

21 (a) REQUIRED POSTING ON WEB SITE.—The Sec22 retary of Housing and Urban Development shall make 

23 publicly available, by posting on a World Wide Web site 

24 of the Department, information regarding multifamily 

25 housing properties for which rental assistance is provided 

26 under section 8 of the United States Housing Act of 1937 


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1 (42 U.S.C. 1437f), for which other rental assistance or 

2 a subsidy is provided under a program administered by 

3 the Secretary, or for which a mortgage is insured under 

4 the National Housing Act (12 U.S.C. 1701 et seq.). 

5 (b) REQUIRED INFORMATION.—The information de6 scribed in subsection (a) regarding a property shall in7 clude— 

8 (1) information regarding the results of phys9 ical inspections of the property, including any real 

10 estate assessment center (REAC) scores for the 

11 property; 

12 (2) any notices, plans, and information relating 

13 to the property required under the Low-Income 

14 Housing Preservation and Resident Homeownership 

15 Act of 1990, including a notice of intent to prepay 

16 a mortgage under section 212, information under 

17 section 216, a second notice of intent under section 

18 216(d), a plan of action under section 217, and no19 tice of approval of a plan of action under section 

20 225; 

21 (3) any notice of request to terminate an insur22 ance contract under title II of the National Housing 

23 Act (12 U.S.C. 1707 et seq.) for a loan or mortgage 

24 on the property; 


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1 (4) any notice of request to prepay a loan or 

2 mortgage on the property insured under title II of 

3 the National Housing Act (12 U.S.C. 1707 et seq.); 

4 and 

5 (5) any notice under section 8(c)(8) of the 

6 United States Housing Act of 1937 (42 U.S.C. 

7 1437f(c)(8)) of proposed termination of an assist8 ance contract under such section for the property. 

9 (c) UPDATING.—The Secretary of Housing and 

10 Urban Development shall update the information made 

11 available pursuant to this section not less than quarterly. 

Æ 


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