79–006 

115TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 2d Session 115–719 

TRANSITIONAL HOUSING FOR RECOVERY IN VIABLE 

ENVIRONMENTS DEMONSTRATION PROGRAM ACT 

JUNE 8, 2018.—Committed to the Committee of the Whole House on the State of 

the Union and ordered to be printed 

Mr. HENSARLING, from the Committee on Financial Services, 

submitted the following 

R E P O R T 

together with 

MINORITY VIEWS 

[To accompany H.R. 5735] 

The Committee on Financial Services, to whom was referred the 

bill (H.R. 5735) to amend the United States Housing Act of 1937 

to establish a demonstration program to set aside section 8 housing 

vouchers for supportive and transitional housing for individuals recovering from opioid use disorders or other substance use disorders, 

and for other purposes, having considered the same, reports favorably thereon with amendments and recommends that the bill as 

amended do pass. 

The amendments (stated in terms of the page and line numbers 

of the introduced bill) are as follows: 

Page 3, strike lines 13 and 14 and insert the following: 

(C) CRITERIA FOR ELIGIBLE ENTITIES.—And eligible entity shall— 

(i) provide an evidencePage 3, line 19, strike the period and insert ‘‘; and’’. 

Page 3, after line 19, insert the following: 

(ii) demonstrate prior experience administering rental assistance vouchers, demonstrate prior experience administering transitional housing programs under the McKinney-Vento Homeless Act, or demonstrate a 

partnership with a public housing agency or a 

2 

1 Centers for Disease Control and Prevention, ‘‘Drug Overdose Death Data,’’ updated December 19, 2017, https://www.cdc.gov/drugoverdose/data/statedeaths.html and National Institute on 

Drug Abuse, ‘‘Overdose Death Rates,’’ revised September 2017, available at https:// 

www.drugabuse.gov/related-topics/trends-statistics/overdose-death-rates. 

housing program of a State, unit of local government, or Indian tribe (as such term is defined in section 4 of the Native American 

Housing and Self-Determination Act of 1996 

(25 U.S.C. 4103)) that ensures effective administration of rental assistance vouchers. 

PURPOSE AND SUMMARY

On May 9, 2018, Rep. Andy Barr introduced H.R. 5735, the 

‘‘Transitional Housing for Opioid Recovery Demonstration Program 

Act of 2018’’ or the ‘‘THRIVE’’ Act. H.R. 5735 would create a demonstration program in which 10,000 vouchers would be set-aside 

and distributed to eligible entities for the support of transitional 

housing for those individuals undergoing opioid use disorder or 

other substance abuse disorder recovery. There would be a timelimit on the vouchers of 12–24 months and the voucher would be 

only available for people in programs that provide evidence-based 

treatment and job skills training according to standards established by the Secretary of the Department of Housing and Urban 

Development (HUD). Four years after implementation of the demonstration program, the HUD Secretary would submit a report to 

Congress that evaluates the effectiveness of the program and includes recommendations as to whether the Congress and HUD 

should implement a larger-scale program or adopt a longer-term 

approach. 

BACKGROUND AND NEED FOR LEGISLATION

According to the Center for Disease Control and Prevention, approximately 64,000 people died of a drug overdose in 2016. Sixtyfive percent (42,000) of those deaths were related to the opioid epidemic, compared to only 8,400 deaths in 2000.1 Given the declaration of a national public health emergency last fall, there is need 

for additional transitional housing for opioid and other substance 

recovery. H.R. 5735 would create such a demonstration program to 

test whether the short-term transitional housing approach is transformational in helping covered individuals maintain sobriety after 

completing rehabilitation, gain valuable skills in job training, obtain employment, and eventually transition back to society to lead 

independent lives. 

On October 26, 2017, President Trump announced that his Administration was declaring the opioid crisis a national Public 

Health Emergency under federal law, effective immediately and the 

President stated, ‘‘I am directing all executive agencies to use every 

appropriate emergency authority to fight the opioid crisis.’’ 

On March 29, 2017, President Trump signed an Executive Order 

to establish the President’s Commission on Combating Drug Addiction and the Opioid Crisis. The Commission will be chaired by Governor Chris Christie and will study ways to combat and treat the 

scourge of drug abuse, addiction, and the opioid crisis. The Commission’s Final Report issued on November 1, 2017 noted, ‘‘There 

3 

2Final Report of the President’s Commission on Combating Drug Addiction and the Opioid 

Crisis, November 1, 2017, available at, https://www.whitehouse.gov/sites/whitehouse.gov/files/images/Final_Report_Draf_11-15-2017.pdf. 3https://www.whitehouse.gov/briefings-statements/cea-report-underestimated-cost-opioid-crisis/ 

. 4 Id. 

is a critical shortage of recovery housing for Americans in or pursuing recovery. Recovery residences (also known as ‘‘sober homes’’ 

or ‘‘recovery homes’’) are alcohol- and drug-free living environments 

for individuals seeking the skills and social support to remain free 

of alcohol or other drugs and live a life of recovery in the community.’’ 2

On November 20, 2017, the Council of Economic Advisers (CEA) 

released a report on the economic costs of the opioid crisis. The 

CEA found that ‘‘previous estimates of the economic cost of the 

opioid crisis greatly understate it by undervaluing the most important component of the loss—fatalities resulting from overdoses.’’ 3

The CEA report estimated that in 2015, ‘‘the economic cost of the 

opioid crisis was $504.0 billion, or 2.8 percent of GDP that year. 

This is over six times larger than the most recently estimated economic cost of the epidemic.’’ 4

The goal of H.R. 5735 is to establish a demonstration program 

to set aside Section 8 housing vouchers for supportive and transitional housing for individuals recovering from opioid and other substance use disorders. 

The demonstration program will provide participants who have 

a drug and substance abuse disorder a free, clean, safe and supportive structured environment. This approach to transitional 

housing would allow residents an opportunity to address their addiction, mental health, homelessness or other personal challenges 

in a supportive environment that could include required participation in activities such as recovery classes, life skills education classes, mandatory savings plans, and full-time or part-time employment. 

The program created by the THRIVE Act is the first step in a 

longer-term and community-based approach to treatment immediately after a covered individual has completed an initial traditional treatment, such as short-term or transitional residential programs. The housing services provided by H.R. 5735 would complement services provided onsite such as case management, peer 

support, and daily living and coping skills education to assist individuals in improving their lives. Supportive housing, when used as 

a short-term approach, can help thousands of Americans maintain 

sobriety after they complete rehabilitation, gain valuable skills and 

job training, obtain employment, and eventually transition back 

into society to lead independent and productive lives. 

HEARINGS

The Committee on Financial Services, Subcommittee on Housing 

and Insurance held a hearing examining matters relating to H.R. 

5735 on April 17, 2018. 

COMMITTEE CONSIDERATION

The Committee on Financial Services met in open session on 

May 22, 2018, and ordered H.R. 5735 to be reported favorably to 

4 

the House, as amended, by a recorded vote of 34 yeas to 19 nays 

(recorded vote no. FC–178), a quorum being present. Before the 

motion to report was offered, the Committee adopted an amendment offered by Mr. Barr, no. 1, by voice vote. 

COMMITTEE VOTES

Clause 3(b) of rule XIII of the Rules of the House of Representatives requires the Committee to list the record votes on the motion 

to report legislation and amendments thereto. A recorded vote was 

held on the amendment offered by Mr. Crist, no. 3. The amendment failed by a vote of 21 yeas to 32 nays (Record vote no. FC– 

177). A recorded vote was held on a motion by Chairman Hensarling to report the bill favorably to the House, as amended. The 

motion was agreed to by a recorded vote of 34 yeas to 19 nays 

(Record vote no. FC–178), a quorum being present. 

5 


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Mr. Hensarling ... __ . _ ... _ .. _ 

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Ms. Maxine Waters (CA) .. 

Mrs. Carolyn B. Maloney (NY)_. 

Ms. Velazquez 

Mr. Sherman 

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Mr. Clay. 

Mr. Lynch 

Mr David Scott (GA) 

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Mr. Hensarling ____ _ 

Mr. McHenry ..... . 

Mr. King ..•....... 

Mr. Royce (CA) 

Mr. Lucas _ 

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Mr. Ross ____ ···-············ 

Mr. Pittenger __ .. ___ _ 

Mrs. Wagner_ --·····--··· .. 

Mr. Barr 

Mr. Rothfus 

Mr. Messer 

Mr. Tipton 

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Mr. Poliquin 

Mrs. Love 

Mr. Hi!! 

Mr Emmer 

Mr. Zeldin 

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Mr. Mooney (WV) ________ ...•. 

Mr. MacArthur 

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Mr. Budd 

Mr. Kustoff (TN)_ .. 

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Mr. 

Ms. Maxine Waters (CAl 

Mrs. Carolyn B. Maloney (NY) __ 

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Mr. Sherman 

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Mr. AI Green (TX) ----------

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Mr. Perlmutter 

Mr. Himes 

Mr. Foster 

Mr. Kildee 

Mr. Delaney 

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Mrs. Beatty _____ _ 

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Mr Gotthe1mer 

Mr. Gonzalez (TX) 

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COMMITTEE OVERSIGHT FINDINGS

Pursuant to clause 3(c)(1) of rule XIII of the Rules of the House 

of Representatives, the findings and recommendations of the Committee based on oversight activities under clause 2(b)(1) of rule X 

of the Rules of the House of Representatives, are incorporated in 

the descriptive portions of this report. 

PERFORMANCE GOALS AND OBJECTIVES

Pursuant to clause 3(c)(4) of rule XIII of the Rules of the House 

of Representatives, the Committee states that H.R. 5735 will provide transitional housing support to thousands of Americans recovering from opioid and substance use disorders and will help them 

gain valuable skills and job training, obtain employment, and eventually transition back into society to lead independent lives by establishing a demonstration program to set aside Section 8 housing 

vouchers for supportive and transitional housing. 

NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX

EXPENDITURES

The Committee has not received an estimate of new budget authority contained in the cost estimate prepared by the Director of 

the Congressional Budget Office pursuant to Sec. 402 of the Congressional Budget Act of 1974. In compliance with clause 3(c)(2) of 

rule XIII of the Rules of the House, the Committee opines that 

H.R. 5735 will not establish any new budget or entitlement authority or create any tax expenditures. 

CONGRESSIONAL BUDGET OFFICE ESTIMATES

The cost estimate prepared by the Director of the Congressional 

Budget Office pursuant to Sec. 402 of the Congressional Budget Act 

of 1974 was not submitted timely to the Committee. 

FEDERAL MANDATES STATEMENT

This information is provided in accordance with section 423 of 

the Unfunded Mandates Reform Act of 1995. 

The Committee has determined that the bill does not contain 

Federal mandates on the private sector. The Committee has determined that the bill does not impose a Federal intergovernmental 

mandate on State, local, or tribal governments. 

ADVISORY COMMITTEE STATEMENT

No advisory committees within the meaning of section 5(b) of the 

Federal Advisory Committee Act were created by this legislation. 

APPLICABILITY TO LEGISLATIVE BRANCH

The Committee finds that the legislation does not relate to the 

terms and conditions of employment or access to public services or 

accommodations within the meaning of the section 102(b)(3) of the 

Congressional Accountability Act. 

8 

EARMARK IDENTIFICATION

With respect to clause 9 of rule XXI of the Rules of the House 

of Representatives, the Committee has carefully reviewed the provisions of the bill and states that the provisions of the bill do not 

contain any congressional earmarks, limited tax benefits, or limited 

tariff benefits within the meaning of the rule. 

DUPLICATION OF FEDERAL PROGRAMS

In compliance with clause 3(c)(5) of rule XIII of the Rules of the 

House of Representatives, the Committee states that no provision 

of the bill establishes or reauthorizes: (1) a program of the Federal 

Government known to be duplicative of another Federal program; 

(2) a program included in any report from the Government Accountability Office to Congress pursuant to section 21 of Public 

Law 111–139; or (3) a program related to a program identified in 

the most recent Catalog of Federal Domestic Assistance, published 

pursuant to the Federal Program Information Act (Pub. L. No. 95– 

220, as amended by Pub. L. No. 98–169). 

DISCLOSURE OF DIRECTED RULEMAKING

Pursuant to section 3(i) of H. Res. 5, (115th Congress), the following statement is made concerning directed rule makings: The 

Committee estimates that the bill requires no directed rule makings within the meaning of such section. 

SECTION-BY-SECTION ANALYSIS OF THE LEGISLATION

Section 1. Short title 

This section cites H.R. 5735 as the ‘‘Transitional Housing for Recovery in Viable Environments Demonstration Program Act’’ or the 

‘‘THRIVE Act.’’ 

Section 2. Demonstration program to study the impact of using rental vouchers for supportive and transitional housing for individuals recovering from opioid use disorders or other substance use 

disorders 

This section establishes a five year demonstration program in 

which the HUD Secretary allocates and distributes Section 8 Housing Choice Vouchers to eligible non-profit organizations for the purposes of providing supportive and transitional housing assistance to 

individuals suffering from opioid or other substance use disorders. 

Eligible non-profit organizations must provide such assistance for 

a period of 12 to 24 months. The Secretary shall set aside the lesser of 0.5 percent of the total number of housing choice vouchers or 

10,000 vouchers for the purposes of the demonstration program. 

To participate in the demonstration program, an eligible entity 

shall provide an evidence-based treatment program and a job skills 

training program for individuals recovering from an opioid use disorder or other substance use disorder that meet standards established by the HUD Secretary. The eligible entity must demonstrate 

prior experience administering rental assistance vouchers, prior experience administering transitional housing programs under the 

McKinney-Vento Homeless Act, or demonstrate a partnership with 

9 

(1) a public housing agency; (2) a housing program of a State or 

unit of local government; or (3) an Indian tribe. 

To receive a rental assistance voucher under this demonstration 

program, an eligible entity shall submit an application to the HUD 

Secretary that includes (i) a description of the terms of the treatment program, job skills training, and rental assistance to be provided to the individual, and assurances that the description shall 

be communicated to individuals that receive a voucher pursuant to 

this demonstration program; and (ii) a transitional plan that begins 

on the date on which a covered individual completes the treatment 

program of the eligible entity that includes information on additional treatment, job skills training, and housing resources and 

services available to such individual. 

In selecting eligible entities to receive rental assistance vouchers, 

the HUD Secretary shall ensure that entities are diverse, represent 

an appropriate balance of eligible entities located in urban and 

rural areas, and provide transitional housing programs in diverse 

geographic regions with high rates of mortality due to opioid and 

other substance use disorders, based on data of the Centers for Disease Control and Prevention. The HUD Secretary must consider 

the success of each eligible non-profit entity at helping individuals 

complete treatment programs, the type of job skills training program provided by the eligible entity, the percentage of participants 

in the job skills training program that gain and maintain employment, and the percentage of participants in the treatment program 

of the eligible entity that do not relapse into opioid or other substance usage and do not receive Federal assistance for treatment 

of an opioid or other substance use disorder. 

Upon turnover of the housing choice voucher of an individual, the 

eligible entity that initially offered the voucher may use the voucher to provide rental assistance to another covered individual. 

The HUD Secretary shall not make rental assistance available 

under this demonstration program after the expiration of the 5- 

year period beginning on the date of the enactment of the Act. 

An eligible entity that receives a rental assistance voucher under 

this demonstration program shall submit to the HUD Secretary annually the transitional plan outlined in this Act and information on 

each covered individual’s housing upon termination of the provision 

of rental assistance. Not later than four years after the date of enactment, the eligible entity must submit a plan describing that 

treatment and housing options for any covered individual who will 

not have completed the program before the day this demonstration 

program sunsets. 

The HUD Secretary shall submit a report to Congress that analyzes the impact of rental assistance provided under this demonstration program not later than two years after the date of enactment of this bill. Not later than four years after the date of enactment, the HUD Secretary shall submit a report to Congress that 

includes recommendations for the continuation or expansion of the 

program established under this bill. 

An eligible entity is defined as a nonprofit organization that 

meets the criteria established under this bill, and a covered individual is defined as an individual recovering from an opioid use 

disorder or other substance use disorder. 

10 

Section 3. Repeal of rental voucher demonstration program 

The rental voucher demonstration program is repealed five years 

after date of enactment of this Act. 

Section 4. Return of vouchers 

An eligible entity that provided vouchers for rental assistance 

under this demonstration program shall return any such voucher 

to the HUD Secretary five years after the date of enactment of this 

Act. 

CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

In compliance with clause 3(e) of rule XIII of the Rules of the 

House of Representatives, changes in existing law made by the bill, 

as reported, are shown as follows (existing law proposed to be omitted is enclosed in black brackets, new matter is printed in italic, 

and existing law in which no change is proposed is shown in 

roman): 

CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

In compliance with clause 3(e) of rule XIII of the Rules of the 

House of Representatives, changes in existing law made by the bill, 

as reported, are shown as follows (existing law proposed to be omitted is enclosed in black brackets, new matter is printed in italic, 

and existing law in which no change is proposed is shown in 

roman): 

UNITED STATES HOUSING ACT OF 1937 

TITLE I—GENERAL PROGRAM OF ASSISTED 

HOUSING 

* * * * * * * 

LOWER INCOME HOUSING ASSISTANCE

SEC. 8. (a) For the purpose of aiding lower-income families in obtaining a decent place to live and of promoting economically mixed 

housing, assistance payments may be made with respect to existing 

housing in accordance with the provisions of this section. 

(b) OTHER EXISTING HOUSING PROGRAMS.—(1) IN GENERAL.—The 

Secretary is authorized to enter into annual contributions contracts 

with public housing agencies pursuant to which such agencies may 

enter into contracts to make assistance payments to owners of existing dwelling units in accordance with this section. In areas 

where no public housing agency has been organized or where the 

Secretary determines that a public housing agency is unable to implement the provisions of this section, the Secretary is authorized 

to enter into such contracts and to perform the other functions assigned to a public housing agency by this section. 

(2) The Secretary is authorized to enter into annual contributions 

contracts with public housing agencies for the purpose of replacing 

public housing transferred in accordance with title III of this Act. 

Each contract entered into under this subsection shall be for a 

term of not more than 60 months. 

11 

(c)(1)(A) An assistance contract entered into pursuant to this section shall establish the maximum monthly rent (including utilities 

and all maintenance and management charges) which the owner is 

entitled to receive for each dwelling unit with respect to which such 

assistance payments are to be made. The maximum monthly rent 

shall not exceed by more than 10 per centum the fair market rental 

established by the Secretary periodically but not less than annually 

for existing or newly constructed rental dwelling units of various 

sizes and types in the market area suitable for occupancy by persons assisted under this section, except that the maximum monthly 

rent may exceed the fair market rental (A) by more than 10 but 

not more than 20 per centum where the Secretary determines that 

special circumstances warrant such higher maximum rent or that 

such higher rent is necessary to the implementation of a housing 

strategy as defined in section 105 of the Cranston-Gonzalez National Affordable Housing Act, or (B) by such higher amount as 

may be requested by a tenant and approved by the public housing 

agency in accordance with paragraph (3)(B). In the case of newly 

constructed and substantially rehabilitated units, the exception in 

the preceding sentence shall not apply to more than 20 per centum 

of the total amount of authority to enter into annual contributions 

contracts for such units which is allocated to an area and obligated 

with respect to any fiscal year beginning on or after October 1, 

1980. Each fair market rental in effect under this subsection shall 

be adjusted to be effective on October 1 of each year to reflect 

changes, based on the most recent available data trended so the 

rentals will be current for the year to which they apply, of rents 

for existing or newly constructed rental dwelling units, as the case 

may be, of various sizes and types in the market area suitable for 

occupancy by persons assisted under this section. Notwithstanding 

any other provision of this section, after the date of enactment of 

the Housing and Community Development Act of 1977, the Secretary shall prohibit high-rise elevator projects for families with 

children unless there is no practical alternative. If units assisted 

under this section are exempt from local rent control while they are 

so assisted or otherwise, the maximum monthly rent for such units 

shall be reasonable in comparison with other units in the market 

area that are exempt from local rent control. 

(B) Fair market rentals for an area shall be published not less 

than annually by the Secretary on the site of the Department on 

the World Wide Web and in any other manner specified by the Secretary. Notice that such fair market rentals are being published 

shall be published in the Federal Register, and such fair market 

rentals shall become effective no earlier than 30 days after the date 

of such publication. The Secretary shall establish a procedure for 

public housing agencies and other interested parties to comment on 

such fair market rentals and to request, within a time specified by 

the Secretary, reevaluation of the fair market rentals in a jurisdiction before such rentals become effective. The Secretary shall cause 

to be published for comment in the Federal Register notices of proposed material changes in the methodology for estimating fair market rentals and notices specifying the final decisions regarding such 

proposed substantial methodological changes and responses to public comments. 

12 

(2)(A) The assistance contract shall provide for adjustment annually or more frequently in the maximum monthly rents for units 

covered by the contract to reflect changes in the fair market rentals 

established in the housing area for similar types and sizes of dwelling units or, if the Secretary determines, on the basis of a reasonable formula. However, where the maximum monthly rent, for a 

unit in a new construction, substantial rehabilitation, or moderate 

rehabilitation project, to be adjusted using an annual adjustment 

factor exceeds the fair market rental for an existing dwelling unit 

in the market area, the Secretary shall adjust the rent only to the 

extent that the owner demonstrates that the adjusted rent would 

not exceed the rent for an unassisted unit of similar quality, type, 

and age in the same market area, as determined by the Secretary. 

The immediately foregoing sentence shall be effective only during 

fiscal year 1995, fiscal year 1996 prior to April 26, 1996, and fiscal 

years 1997 and 1998, and during fiscal year 1999 and thereafter. 

Except for assistance under the certificate program, for any unit occupied by the same family at the time of the last annual rental adjustment, where the assistance contract provides for the adjustment of the maximum monthly rent by applying an annual adjustment factor and where the rent for a unit is otherwise eligible for 

an adjustment based on the full amount of the factor, 0.01 shall be 

subtracted from the amount of the factor, except that the factor 

shall not be reduced to less than 1.0. In the case of assistance 

under the certificate program, 0.01 shall be subtracted from the 

amount of the annual adjustment factor (except that the factor 

shall not be reduced to less than 1.0), and the adjusted rent shall 

not exceed the rent for a comparable unassisted unit of similar 

quality, type, and age in the market area. The immediately foregoing two sentences shall be effective only during fiscal year 1995, 

fiscal year 1996 prior to April 26, 1996, and fiscal years 1997 and 

1998, and during fiscal year 1999 and thereafter. In establishing 

annual adjustment factors for units in new construction and substantial rehabilitation projects, the Secretary shall take into account the fact that debt service is a fixed expense. The immediately 

foregoing sentence shall be effective only during fiscal year 1998. 

(B) The contract shall further provide for the Secretary to make 

additional adjustments in the maximum monthly rent for units 

under contract to the extent he determines such adjustments are 

necessary to reflect increases in the actual and necessary expenses 

of owning and maintaining the units which have resulted from substantial general increases in real property taxes, utility rates, or 

similar costs which are not adequately compensated for by the adjustment in the maximum monthly rent authorized by subparagraph (A). The Secretary shall make additional adjustments in the 

maximum monthly rent for units under contract (subject to the 

availability of appropriations for contract amendments) to the extent the Secretary determines such adjustments are necessary to 

reflect increases in the actual and necessary expenses of owning 

and maintaining the units that have resulted from the expiration 

of a real property tax exemption. Where the Secretary determines 

that a project assisted under this section is located in a community 

where drug-related criminal activity is generally prevalent and the 

project’s operating, maintenance, and capital repair expenses have 

been substantially increased primarily as a result of the prevalence 

13 

of such drug-related activity, the Secretary may (at the discretion 

of the Secretary and subject to the availability of appropriations for 

contract amendments for this purpose), on a project by project 

basis, provide adjustments to the maximum monthly rents, to a 

level no greater than 120 percent of the project rents, to cover the 

costs of maintenance, security, capital repairs, and reserves required for the owner to carry out a strategy acceptable to the Secretary for addressing the problem of drug-related criminal activity. 

Any rent comparability standard required under this paragraph 

may be waived by the Secretary to so implement the preceding sentence. The Secretary may (at the discretion of the Secretary and 

subject to the availability of appropriations for contract amendments), on a project by project basis for projects receiving projectbased assistance, provide adjustments to the maximum monthly 

rents to cover the costs of evaluating and reducing lead-based paint 

hazards, as defined in section 1004 of the Residential Lead-Based 

Paint Hazard Reduction Act of 1992. 

(C) Adjustments in the maximum rents under subparagraphs (A) 

and (B) shall not result in material differences between the rents 

charged for assisted units and unassisted units of similar quality, 

type, and age in the same market area, as determined by the Secretary. In implementing the limitation established under the preceding sentence, the Secretary shall establish regulations for conducting comparability studies for projects where the Secretary has 

reason to believe that the application of the formula adjustments 

under subparagraph (A) would result in such material differences. 

The Secretary shall conduct such studies upon the request of any 

owner of any project, or as the Secretary determines to be appropriate by establishing, to the extent practicable, a modified annual 

adjustment factor for such market area, as the Secretary shall designate, that is geographically smaller than the applicable housing 

area used for the establishment of the annual adjustment factor 

under subparagraph (A). The Secretary shall establish such modified annual adjustment factor on the basis of the results of a study 

conducted by the Secretary of the rents charged, and any change 

in such rents over the previous year, for assisted units and unassisted units of similar quality, type, and age in the smaller market 

area. Where the Secretary determines that such modified annual 

adjustment factor cannot be established or that such factor when 

applied to a particular project would result in material differences 

between the rents charged for assisted units and unassisted units 

of similar quality, type, and age in the same market area, the Secretary may apply an alternative methodology for conducting comparability studies in order to establish rents that are not materially 

different from rents charged for comparable unassisted units. If the 

Secretary or appropriate State agency does not complete and submit to the project owner a comparability study not later than 60 

days before the anniversary date of the assistance contract under 

this section, the automatic annual adjustment factor shall be applied. The Secretary may not reduce the contract rents in effect on 

or after April 15, 1987, for newly constructed, substantially rehabilitated, or moderately rehabilitated projects assisted under this 

section (including projects assisted under this section as in effect 

prior to November 30, 1983), unless the project has been refinanced 

in a manner that reduces the periodic payments of the owner. Any 

14 

maximum monthly rent that has been reduced by the Secretary 

after April 14, 1987, and prior to the enactment of this sentence 

shall be restored to the maximum monthly rent in effect on April 

15, 1987. For any project which has had its maximum monthly 

rents reduced after April 14, 1987, the Secretary shall make assistance payments (from amounts reserved for the original contract) to 

the owner of such project in an amount equal to the difference between the maximum monthly rents in effect on April 15, 1987, and 

the reduced maximum monthly rents, multiplied by the number of 

months that the reduced maximum monthly rents were in effect. 

(3) The amount of the monthly assistance payment with respect 

to any dwelling unit shall be the difference between the maximum 

monthly rent which the contract provides that the owner is to receive for the unit and the rent the family is required to pay under 

section 3(a) of this Act. 

(4) The assistance contract shall provide that assistance payments may be made only with respect to a dwelling unit under 

lease for occupancy by a family determined to be a lower income 

family at the time it initially occupied such dwelling unit, except 

that such payments may be made with respect to unoccupied units 

for a period not exceeding sixty days (A) in the event that a family 

vacates a dwelling unit before the expiration date of the lease for 

occupancy or (B) where a good faith effort is being made to fill an 

unoccupied unit, and, subject to the provisions of the following sentence, such payments may be made, in the case of a newly constructed or substantially rehabilitated project, after such sixty-day 

period in an amount equal to the debt service attributable to such 

an unoccupied dwelling unit for a period not to exceed one year, if 

a good faith effort is being made to fill the unit and the unit provides decent, safe, and sanitary housing. No such payment may be 

made after such sixty-day period if the Secretary determines that 

the dwelling unit is in a project which provides the owner with revenues exceeding the costs incurred by such owner with respect to 

such project. 

(5) The Secretary shall take such steps as may be necessary, including the making of contracts for assistance payments in 

amounts in excess of the amounts required at the time of the initial 

renting of dwelling units, the reservation of annual contributions 

authority for the purpose of amending housing assistance contracts, 

or the allocation of a portion of new authorizations for the purpose 

of amending housing assistance contracts, to assure that assistance 

payments are increased on a timely basis to cover increases in 

maximum monthly rents or decreases in family incomes. 

(8)(A) Not less than one year before termination of any contract 

under which assistance payments are received under this section, 

other than a contract for tenant-based assistance under this section, an owner shall provide written notice to the Secretary and the 

tenants involved of the proposed termination. The notice shall also 

include a statement that, if the Congress makes funds available, 

the owner and the Secretary may agree to a renewal of the contract, thus avoiding termination, and that in the event of termination the Department of Housing and Urban Development will 

provide tenant-based rental assistance to all eligible residents, enabling them to choose the place they wish to rent, which is likely 

to include the dwelling unit in which they currently reside. Any 

15 

contract covered by this paragraph that is renewed may be renewed for a period of up to 1 year or any number or years, with 

payments subject to the availability of appropriations for any year. 

(B) In the event the owner does not provide the notice required, 

the owner may not evict the tenants or increase the tenants’ rent 

payment until such time as the owner has provided the notice and 

1 year has elapsed. The Secretary may allow the owner to renew 

the terminating contract for a period of time sufficient to give tenants 1 year of advance notice under such terms and conditions as 

the Secretary may require. 

(C) Any notice under this paragraph shall also comply with any 

additional requirements established by the Secretary. 

(D) For purposes of this paragraph, the term ‘‘termination’’ 

means the expiration of the assistance contract or an owner’s refusal to renew the assistance contract, and such term shall include 

termination of the contract for business reasons. 

(d)(1) Contracts to make assistance payments entered into by a 

public housing agency with an owner of existing housing units 

shall provide (with respect to any unit) that— 

(A) the selection of tenants shall be the function of the 

owner, subject to the annual contributions contract between the Secretary and the agency, except that with respect to the certificate and moderate rehabilitation programs only, for the purpose of selecting families to be assisted, the public housing agency may establish local preferences, consistent with the public housing agency plan 

submitted under section 5A (42 U.S.C. 1437c–1) by the 

public housing agency; 

(B)(i) the lease between the tenant and the owner shall be 

for at least one year or the term of such contract, whichever 

is shorter, and shall contain other terms and conditions specified by the Secretary; 

(ii) during the term of the lease, the owner shall not terminate the tenancy except for serious or repeated violation of the 

terms and conditions of the lease, for violation of applicable 

Federal, State, or local law, or for other good cause; 

(iii) during the term of the lease, any criminal activity that 

threatens the health, safety, or right to peaceful enjoyment of 

the premises by other tenants, any criminal activity that 

threatens the health, safety, or right to peaceful enjoyment of 

their residences by persons residing in the immediate vicinity 

of the premises, or any drug-related criminal activity on or 

near such premises, engaged in by a tenant of any unit, any 

member of the tenant’s household, or any guest or other person 

under the tenant’s control, shall be cause for termination of 

tenancy; 

(iv) any termination of tenancy shall be preceded by the owner’s provision of written notice to the tenant specifying the 

grounds for such action; and 

(v) it shall be cause for termination of the tenancy of a 

tenant if such tenant— 

(I) is fleeing to avoid prosecution, or custody or confinement after conviction, under the laws of the place 

from which the individual flees, for a crime, or attempt to commit a crime, which is a felony under the 

16 

laws of the place from which the individual flees, or 

which, in the case of the State of New Jersey, is a high 

misdemeanor under the laws of such State; or 

(II) is violating a condition of probation or parole imposed under Federal or State law; 

(C) maintenance and replacement (including redecoration) 

shall be in accordance with the standard practice for the building concerned as established by the owner and agreed to by the 

agency; and 

(D) the agency and the owner shall carry out such other appropriate terms and conditions as may be mutually agreed to 

by them. 

(2)(A) Each contract for an existing structure entered into under 

this section shall be for a term of not less than one month nor more 

than one hundred and eighty months. The Secretary shall permit 

public housing agencies to enter into contracts for assistance payments of less than 12 months duration in order to avoid disruption 

in assistance to eligible families if the annual contributions contract is within 1 year of its expiration date. 

(B)(i) In determining the amount of assistance provided under an 

assistance contract for project-based assistance under this paragraph or a contract for assistance for housing constructed or substantially rehabilitated pursuant to assistance provided under section 8(b)(2) of this Act (as such section existed immediately before 

October 1, 1983), the Secretary may consider and annually adjust, 

with respect to such project, for the cost of employing or otherwise 

retaining the services of one or more service coordinators under 

section 661 of the Housing and Community Development Act of 

1992 to coordinate the provision of any services within the project 

for residents of the project who are elderly or disabled families. 

(ii) The budget authority available under section 5(c) for assistance under this section is authorized to be increased by 

$15,000,000 on or after October 1, 1992, and by $15,000,000 on or 

after October 1, 1993. Amounts made available under this subparagraph shall be used to provide additional amounts under annual 

contributions contracts for assistance under this section which 

shall be made available through assistance contracts only for the 

purpose of providing service coordinators under clause (i) for 

projects receiving project-based assistance under this paragraph 

and to provide additional amounts under contracts for assistance 

for projects constructed or substantially rehabilitated pursuant to 

assistance provided under section 8(b)(2) of this Act (as such section existed immediately before October 1, 1983) only for such purpose. 

(C) An assistance contract for project-based assistance under 

this paragraph shall provide that the owner shall ensure and 

maintain compliance with subtitle C of title VI of the Housing 

and Community Development Act of 1992 and any regulations 

issued under such subtitle. 

(D) An owner of a covered section 8 housing project (as such 

term is defined in section 659 of the Housing and Community 

Development Act of 1992) may give preference for occupancy of 

dwelling units in the project, and reserve units for occupancy, 

in accordance with subtitle D of title VI of the Housing and 

Community Development Act of 1992. 

17 

(3) Notwithstanding any other provision of law, with the approval of the Secretary the public housing agency administering a 

contract under this section with respect to existing housing units 

may exercise all management and maintenance responsibilities 

with respect to those units pursuant to a contract between such 

agency and the owner of such units. 

(4) A public housing agency that serves more than one unit of 

general local government may, at the discretion of the agency, in 

allocating assistance under this section, give priority to disabled 

families that are not elderly families. 

(5) CALCULATION OF LIMIT.—Any contract entered into under 

section 514 of the Multifamily Assisted Housing Reform and 

Affordability Act of 1997 shall be excluded in computing the 

limit on project-based assistance under this subsection. 

(6) TREATMENT OF COMMON AREAS.—The Secretary may not provide any assistance amounts pursuant to an existing contract for 

project-based assistance under this section for a housing project 

and may not enter into a new or renewal contract for such assistance for a project unless the owner of the project provides consent, 

to such local law enforcement agencies as the Secretary determines 

appropriate, for law enforcement officers of such agencies to enter 

common areas of the project at any time and without advance notice upon a determination of probable cause by such officers that 

criminal activity is taking place in such areas. 

(e)(1) Nothing in this Act shall be deemed to prohibit an owner 

from pledging, or offering as security for any loan or obligation, a 

contract for assistance payments entered into pursuant to this section: Provided, That such security is in connection with a project 

constructed or rehabilitated pursuant to authority granted in this 

section, and the terms of the financing or any refinancing have 

been approved by the Secretary. 

(f) As used in this section— 

(1) the term ‘‘owner’’ means any private person or entity, including a cooperative, an agency of the Federal Government, or 

a public housing agency, having the legal right to lease or sublease dwelling units; 

(2) the terms ‘‘rent’’ or ‘‘rental’’ mean, with respect to members of a cooperative, the charges under the occupancy agreements between such members and the cooperative; 

(3) the term ‘‘debt service’’ means the required payments for 

principal and interest made with respect to a mortgage secured 

by housing assisted under this Act; 

(4) the term ‘‘participating jurisdiction’’ means a State or 

unit of general local government designated by the Secretary 

to be a participating jurisdiction under title II of the CranstonGonzalez National Affordable Housing Act; 

(5) the term ‘‘drug-related criminal activity’’ means the illegal manufacture, sale, distribution, use, or possession with intent to manufacture, sell, distribute, or use, of a controlled substance (as defined in section 102 of the Controlled Substances 

Act (21 U.S.C. 802)); 

(6) the term ‘‘project-based assistance’’ means rental assistance under subsection (b) that is attached to the structure pursuant to subsection (d)(2) or (o)(13); and 

18 

(7) the term ‘‘tenant-based assistance’’ means rental assistance under subsection (o) that is not project-based assistance 

and that provides for the eligible family to select suitable housing and to move to other suitable housing. 

(g) Notwithstanding any other provision of this Act, assistance 

payments under this section may be provided, in accordance with 

regulations prescribed by the Secretary, with respect to some or all 

of the units in any project approved pursuant to section 202 of the 

Housing Act of 1959. 

(h) Sections 5(e) and 6 and any other provisions of this Act which 

are inconsistent with the provisions of this section shall not apply 

to contracts for assistance entered into under this section. 

(i) The Secretary may not consider the receipt by a public housing agency of assistance under section 811(b)(1) of the CranstonGonzalez National Affordable Housing Act, or the amount received, 

in approving assistance for the agency under this section or determining the amount of such assistance to be provided. 

(k) The Secretary shall establish procedures which are appropriate and necessary to assure that income data provided to public 

housing agencies and owners by families applying for or receiving 

assistance under this section is complete and accurate. In establishing such procedures, the Secretary shall randomly, regularly, 

and periodically select a sample of families to authorize the Secretary to obtain information on these families for the purpose of income verification, or to allow those families to provide such information themselves. Such information may include, but is not limited to, data concerning unemployment compensation and Federal 

income taxation and data relating to benefits made available under 

the Social Security Act, the Food and Nutrition Act of 2008, or title 

38, United States Code. Any such information received pursuant to 

this subsection shall remain confidential and shall be used only for 

the purpose of verifying incomes in order to determine eligibility of 

families for benefits (and the amount of such benefits, if any) under 

this section. 

(o) VOUCHER PROGRAM.— (1) AUTHORITY.— (A) IN GENERAL.—The Secretary may provide assistance 

to public housing agencies for tenant-based assistance 

using a payment standard established in accordance with 

subparagraph (B). The payment standard shall be used to 

determine the monthly assistance that may be paid for any 

family, as provided in paragraph (2). 

(B) ESTABLISHMENT OF PAYMENT STANDARD.—Except as 

provided under subparagraph (D), the payment standard 

for each size of dwelling unit in a market area shall not 

exceed 110 percent of the fair market rental established 

under subsection (c) for the same size of dwelling unit in 

the same market area and shall be not less than 90 percent of that fair market rental, except that no public housing agency shall be required as a result of a reduction in 

the fair market rental to reduce the payment standard applied to a family continuing to reside in a unit for which 

the family was receiving assistance under this section at 

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19 

ception payment standards within fair market rental areas 

subject to criteria and procedures established by the Secretary. 

(C) SET-ASIDE.—The Secretary may set aside not more 

than 5 percent of the budget authority made available for 

assistance under this subsection as an adjustment pool. 

The Secretary shall use amounts in the adjustment pool to 

make adjusted payments to public housing agencies under 

subparagraph (A), to ensure continued affordability, if the 

Secretary determines that additional assistance for such 

purpose is necessary, based on documentation submitted 

by a public housing agency. 

(D) APPROVAL.—The Secretary may require a public 

housing agency to submit the payment standard of the 

public housing agency to the Secretary for approval, if the 

payment standard is less than 90 percent of the fair market rental or exceeds 110 percent of the fair market rental, 

except that a public housing agency may establish a payment standard of not more than 120 percent of the fair 

market rent where necessary as a reasonable accommodation for a person with a disability, without approval of the 

Secretary. A public housing agency may use a payment 

standard that is greater than 120 percent of the fair market rent as a reasonable accommodation for a person with 

a disability, but only with the approval of the Secretary. 

In connection with the use of any increased payment 

standard established or approved pursuant to either of the 

preceding two sentences as a reasonable accommodation 

for a person with a disability, the Secretary may not establish additional requirements regarding the amount of adjusted income paid by such person for rent. 

(E) REVIEW.—The Secretary— 

(i) shall monitor rent burdens and review any payment standard that results in a significant percentage 

of the families occupying units of any size paying more 

than 30 percent of adjusted income for rent; and 

(ii) may require a public housing agency to modify 

the payment standard of the public housing agency 

based on the results of that review. 

(2) AMOUNT OF MONTHLY ASSISTANCE PAYMENT.—Subject to 

the requirement under section 3(a)(3) (relating to minimum 

rental amount), the monthly assistance payment for a family 

receiving assistance under this subsection shall be determined 

as follows: 

(A) TENANT-BASED ASSISTANCE; RENT NOT EXCEEDING

PAYMENT STANDARD.—For a family receiving tenant-based 

assistance, if the rent for the family (including the amount 

allowed for tenant-paid utilities) does not exceed the applicable payment standard established under paragraph (1), 

the monthly assistance payment for the family shall be 

equal to the amount by which the rent (including the 

amount allowed for tenant-paid utilities) exceeds the 

greatest of the following amounts, rounded to the nearest 

dollar: 

20 

(i) 30 percent of the monthly adjusted income of the 

family. 

(ii) 10 percent of the monthly income of the family. 

(iii) If the family is receiving payments for welfare 

assistance from a public agency and a part of those 

payments, adjusted in accordance with the actual 

housing costs of the family, is specifically designated 

by that agency to meet the housing costs of the family, 

the portion of those payments that is so designated. 

(B) TENANT-BASED ASSISTANCE; RENT EXCEEDING PAYMENT STANDARD.—For a family receiving tenant-based assistance, if the rent for the family (including the amount 

allowed for tenant-paid utilities) exceeds the applicable 

payment standard established under paragraph (1), the 

monthly assistance payment for the family shall be equal 

to the amount by which the applicable payment standard 

exceeds the greatest of amounts under clauses (i), (ii), and 

(iii) of subparagraph (A). 

(C) FAMILIES RECEIVING PROJECT-BASED ASSISTANCE.— 

For a family receiving project-based assistance, the rent 

that the family is required to pay shall be determined in 

accordance with section 3(a)(1), and the amount of the 

housing assistance payment shall be determined in accordance with subsection (c)(3) of this section. 

(D) UTILITY ALLOWANCE.— 

(i) GENERAL.—In determining the monthly assistance payment for a family under subparagraphs (A) 

and (B), the amount allowed for tenant-paid utilities 

shall not exceed the appropriate utility allowance for 

the family unit size as determined by the public housing agency regardless of the size of the dwelling unit 

leased by the family. 

(ii) EXCEPTION FOR FAMILIES IN INCLUDING PERSONS

WITH DISABILITIES.—Notwithstanding subparagraph 

(A), upon request by a family that includes a person 

with disabilities, the public housing agency shall approve a utility allowance that is higher than the applicable amount on the utility allowance schedule if a 

higher utility allowance is needed as a reasonable accommodation to make the program accessible to and 

usable by the family member with a disability. 

(3) 40 PERCENT LIMIT.—At the time a family initially receives 

tenant-based assistance under this section with respect to any 

dwelling unit, the total amount that a family may be required 

to pay for rent may not exceed 40 percent of the monthly adjusted income of the family. 

(4) ELIGIBLE FAMILIES.—To be eligible to receive assistance 

under this subsection, a family shall, at the time a family initially receives assistance under this subsection, be a low-income family that is— 

(A) a very low-income family; 

(B) a family previously assisted under this title; 

(C) a low-income family that meets eligibility criteria 

specified by the public housing agency; 

21 

(D) a family that qualifies to receive a voucher in connection with a homeownership program approved under 

title IV of the Cranston-Gonzalez National Affordable 

Housing Act; or 

(E) a family that qualifies to receive a voucher under 

section 223 or 226 of the Low-Income Housing Preservation and Resident Homeownership Act of 1990. 

(5) REVIEWS OF FAMILY INCOME.— (A) IN GENERAL.—Reviews of family incomes for purposes of this section shall be subject to paragraphs (1), (6), 

and (7) of section 3(a) and to section 904 of the Stewart B. 

McKinney Homeless Assistance Amendments Act of 1988. 

(B) PROCEDURES.—Each public housing agency administering assistance under this subsection shall establish 

procedures that are appropriate and necessary to ensure 

that income data provided to the agency and owners by 

families applying for or receiving assistance from the agency is complete and accurate. 

(6) SELECTION OF FAMILIES AND DISAPPROVAL OF

OWNERS.— 

(A) PREFERENCES.— (i) AUTHORITY TO ESTABLISH.—Each public housing 

agency may establish a system for making tenantbased assistance under this subsection available on behalf of eligible families that provides preference for 

such assistance to eligible families having certain 

characteristics, which may include a preference for 

families residing in public housing who are victims of 

a crime of violence (as such term is defined in section 

16 of title 18, United States Code) that has been reported to an appropriate law enforcement agency. 

(ii) CONTENT.—Each system of preferences established pursuant to this subparagraph shall be based 

upon local housing needs and priorities, as determined 

by the public housing agency using generally accepted 

data sources, including any information obtained pursuant to an opportunity for public comment as provided under section 5A(f) and under the requirements 

applicable to the comprehensive housing affordability 

strategy for the relevant jurisdiction. 

(B) SELECTION OF TENANTS.—Each housing assistance 

payment contract entered into by the public housing agency and the owner of a dwelling unit) shall provide that the 

screening and selection of families for those units shall be 

the function of the owner. In addition, the public housing 

agency may elect to screen applicants for the program in 

accordance with such requirements as the Secretary may 

establish. 

(C) PHA DISAPPROVAL OF OWNERS.—In addition to other 

grounds authorized by the Secretary, a public housing 

agency may elect not to enter into a housing assistance 

payments contract under this subsection with an owner 

who refuses, or has a history of refusing, to take action to 

terminate tenancy for activity engaged in by the tenant, 

any member of the tenant’s household, any guest, or any 

22 

other person under the control of any member of the 

household that— 

(i) threatens the health or safety of, or right to 

peaceful enjoyment of the premises by, other tenants 

or employees of the public housing agency, owner, or 

other manager of the housing; 

(ii) threatens the health or safety of, or right to 

peaceful enjoyment of the residences by, persons residing in the immediate vicinity of the premises; or 

(iii) is drug-related or violent criminal activity. 

(7) LEASES AND TENANCY.—Each housing assistance payment 

contract entered into by the public housing agency and the 

owner of a dwelling unit— 

(A) shall provide that the lease between the tenant and 

the owner shall be for a term of not less than 1 year, except that the public housing agency may approve a shorter 

term for an initial lease between the tenant and the dwelling unit owner if the public housing agency determines 

that such shorter term would improve housing opportunities for the tenant and if such shorter term is considered 

to be a prevailing local market practice; 

(B) shall provide that the dwelling unit owner shall offer 

leases to tenants assisted under this subsection that— 

(i) are in a standard form used in the locality by the 

dwelling unit owner; and 

(ii) contain terms and conditions that— 

(I) are consistent with State and local law; and 

(II) apply generally to tenants in the property 

who are not assisted under this section; 

(C) shall provide that during the term of the lease, the 

owner shall not terminate the tenancy except for serious 

or repeated violation of the terms and conditions of the 

lease, for violation of applicable Federal, State, or local 

law, or for other good cause,; 

(D) shall provide that during the term of the lease, any 

criminal activity that threatens the health, safety, or right 

to peaceful enjoyment of the premises by other tenants, 

any criminal activity that threatens the health, safety, or 

right to peaceful enjoyment of their residences by persons 

residing in the immediate vicinity of the premises, or any 

violent or drug-related criminal activity on or near such 

premises, engaged in by a tenant of any unit, any member 

of the tenant’s household, or any guest or other person 

under the tenant’s control, shall be cause for termination 

of tenancy; 

(E) shall provide that any termination of tenancy under 

this subsection shall be preceded by the provision of written notice by the owner to the tenant specifying the 

grounds for that action, and any relief shall be consistent 

with applicable State and local law; and 

(F) may include any addenda required by the Secretary 

to set forth the provisions of this subsection. 

(8) INSPECTION OF UNITS BY PHA’S.— 

(A) INITIAL INSPECTION.— 

23 

(i) IN GENERAL.—For each dwelling unit for which a 

housing assistance payment contract is established 

under this subsection, the public housing agency (or 

other entity pursuant to paragraph (11)) shall inspect 

the unit before any assistance payment is made to determine whether the dwelling unit meets the housing 

quality standards under subparagraph (B), except as 

provided in clause (ii) or (iii) of this subparagraph. 

(ii) CORRECTION OF NON-LIFE-THREATENING CONDI- TIONS.—In the case of any dwelling unit that is determined, pursuant to an inspection under clause (i), not 

to meet the housing quality standards under subparagraph (B), assistance payments may be made for the 

unit notwithstanding subparagraph (C) if failure to 

meet such standards is a result only of non-life-threatening conditions, as such conditions are established by 

the Secretary. A public housing agency making assistance payments pursuant to this clause for a dwelling 

unit shall, 30 days after the beginning of the period 

for which such payments are made, withhold any assistance payments for the unit if any deficiency resulting in noncompliance with the housing quality standards has not been corrected by such time. The public 

housing agency shall recommence assistance payments 

when such deficiency has been corrected, and may use 

any payments withheld to make assistance payments 

relating to the period during which payments were 

withheld. 

(iii) USE OF ALTERNATIVE INSPECTION METHOD FOR

INTERIM PERIOD.—In the case of any property that 

within the previous 24 months has met the requirements of an inspection that qualifies as an alternative 

inspection method pursuant to subparagraph (E), a 

public housing agency may authorize occupancy before 

the inspection under clause (i) has been completed, 

and may make assistance payments retroactive to the 

beginning of the lease term after the unit has been determined pursuant to an inspection under clause (i) to 

meet the housing quality standards under subparagraph (B). This clause may not be construed to exempt 

any dwelling unit from compliance with the requirements of subparagraph (D). 

(B) HOUSING QUALITY STANDARDS.—The housing quality 

standards under this subparagraph are standards for safe 

and habitable housing established— 

(i) by the Secretary for purposes of this subsection; 

or 

(ii) by local housing codes or by codes adopted by 

public housing agencies that— 

(I) meet or exceed housing quality standards, 

except that the Secretary may waive the requirement under this subclause to significantly increase access to affordable housing and to expand 

housing opportunities for families assisted under 

this subsection, except where such waiver could 

24 

adversely affect the health or safety of families assisted under this subsection; and 

(II) do not severely restrict housing choice 

(C) INSPECTION.—The determination required under subparagraph (A) shall be made by the public housing agency 

(or other entity, as provided in paragraph (11)) pursuant 

to an inspection of the dwelling unit conducted before any 

assistance payment is made for the unit. Inspections of 

dwelling units under this subparagraph shall be made before the expiration of the 15-day period beginning upon a 

request by the resident or landlord to the public housing 

agency or, in the case of any public housing agency that 

provides assistance under this subsection on behalf of 

more than 1250 families, before the expiration of a reasonable period beginning upon such request. The performance 

of the agency in meeting the 15-day inspection deadline 

shall be taken into consideration in assessing the performance of the agency. 

(D) BIENNIAL INSPECTIONS.— 

(i) REQUIREMENT.—Each public housing agency providing assistance under this subsection (or other entity, as provided in paragraph (11)) shall, for each assisted dwelling unit, make inspections not less often 

than biennially during the term of the housing assistance payments contract for the unit to determine 

whether the unit is maintained in accordance with the 

requirements under subparagraph (A). 

(ii) USE OF ALTERNATIVE INSPECTION METHOD.—The 

requirements under clause (i) may be complied with 

by use of inspections that qualify as an alternative inspection method pursuant to subparagraph (E). 

(iii) RECORDS.—The public housing agency (or other 

entity) shall retain the records of the inspection for a 

reasonable time, as determined by the Secretary, and 

shall make the records available upon request to the 

Secretary, the Inspector General for the Department 

of Housing and Urban Development, and any auditor 

conducting an audit under section 5(h). 

(iv) MIXED-FINANCE PROPERTIES.—The Secretary 

may adjust the frequency of inspections for mixed-finance properties assisted with vouchers under paragraph (13) to facilitate the use of the alternative inspections in subparagraph (E). 

(E) ALTERNATIVE INSPECTION METHOD.—An inspection of 

a property shall qualify as an alternative inspection method for purposes of this subparagraph if— 

(i) the inspection was conducted pursuant to requirements under a Federal, State, or local housing 

program (including the Home investment partnership 

program under title II of the Cranston-Gonzalez National Affordable Housing Act and the low-income 

housing tax credit program under section 42 of the Internal Revenue Code of 1986); and 

(ii) pursuant to such inspection, the property was 

determined to meet the standards or requirements reVerDate Sep 11 2014 04:22 Jun 09, 2018 Jkt 079006 PO 00000 Frm 00024 Fmt 6659 Sfmt 6601 E:\HR\OC\HR719.XXX HR719
25 

garding housing quality or safety applicable to properties assisted under such program, and, if a non-Federal standard or requirement was used, the public 

housing agency has certified to the Secretary that 

such standard or requirement provides the same (or 

greater) protection to occupants of dwelling units 

meeting such standard or requirement as would the 

housing quality standards under subparagraph (B). 

(F) INTERIM INSPECTIONS.—Upon notification to the public housing agency, by a family (on whose behalf tenantbased rental assistance is provided under this subsection) 

or by a government official, that the dwelling unit for 

which such assistance is provided does not comply with the 

housing quality standards under subparagraph (B), the 

public housing agency shall inspect the dwelling unit— 

(i) in the case of any condition that is life-threatening, within 24 hours after the agency’s receipt of 

such notification, unless waived by the Secretary in 

extraordinary circumstances; and 

(ii) in the case of any condition that is not lifethreatening, within a reasonable time frame, as determined by the Secretary. 

(G) ENFORCEMENT OF HOUSING QUALITY STANDARDS.— (i) DETERMINATION OF NONCOMPLIANCE.—A dwelling 

unit that is covered by a housing assistance payments 

contract under this subsection shall be considered, for 

purposes of subparagraphs (D) and (F), to be in noncompliance with the housing quality standards under 

subparagraph (B) if— 

(I) the public housing agency or an inspector authorized by the State or unit of local government 

determines upon inspection of the unit that the 

unit fails to comply with such standards; 

(II) the agency or inspector notifies the owner of 

the unit in writing of such failure to comply; and 

(III) the failure to comply is not corrected— 

(aa) in the case of any such failure that is 

a result of life-threatening conditions, within 

24 hours after such notice has been provided; 

and 

(bb) in the case of any such failure that is 

a result of non-life-threatening conditions, 

within 30 days after such notice has been provided or such other reasonable longer period 

as the public housing agency may establish. 

(ii) WITHHOLDING OF ASSISTANCE AMOUNTS DURING

CORRECTION.—The public housing agency may withhold assistance amounts under this subsection with 

respect to a dwelling unit for which a notice pursuant 

to clause (i)(II), of failure to comply with housing quality standards under subparagraph (B) as determined 

pursuant to an inspection conducted under subparagraph (D) or (F), has been provided. If the unit is 

brought into compliance with such housing quality 

standards during the periods referred to in clause 

26 

(i)(III), the public housing agency shall recommence 

assistance payments and may use any amounts withheld during the correction period to make assistance 

payments relating to the period during which payments were withheld. 

(iii) ABATEMENT OF ASSISTANCE AMOUNTS.—The public housing agency shall abate all of the assistance 

amounts under this subsection with respect to a dwelling unit that is determined, pursuant to clause (i) of 

this subparagraph, to be in noncompliance with housing quality standards under subparagraph (B). Upon 

completion of repairs by the public housing agency or 

the owner sufficient so that the dwelling unit complies 

with such housing quality standards, the agency shall 

recommence payments under the housing assistance 

payments contract to the owner of the dwelling unit. 

(iv) NOTIFICATION.—If a public housing agency providing assistance under this subsection abates rental 

assistance payments pursuant to clause (iii) with respect to a dwelling unit, the agency shall, upon commencement of such abatement— 

(I) notify the tenant and the owner of the dwelling unit that— 

(aa) such abatement has commenced; and 

(bb) if the dwelling unit is not brought into 

compliance with housing quality standards 

within 60 days after the effective date of the 

determination of noncompliance under clause 

(i) or such reasonable longer period as the 

agency may establish, the tenant will have to 

move; and 

(II) issue the tenant the necessary forms to 

allow the tenant to move to another dwelling unit 

and transfer the rental assistance to that unit. 

(v) PROTECTION OF TENANTS.—An owner of a dwelling unit may not terminate the tenancy of any tenant 

because of the withholding or abatement of assistance 

pursuant to this subparagraph. During the period that 

assistance is abated pursuant to this subparagraph, 

the tenant may terminate the tenancy by notifying the 

owner. 

(vi) TERMINATION OF LEASE OR ASSISTANCE PAYMENTS CONTRACT.—If assistance amounts under this 

section for a dwelling unit are abated pursuant to 

clause (iii) and the owner does not correct the noncompliance within 60 days after the effective date of 

the determination of noncompliance under clause (i), 

or such other reasonable longer period as the public 

housing agency may establish, the agency shall terminate the housing assistance payments contract for the 

dwelling unit. 

(vii) RELOCATION.— (I) LEASE OF NEW UNIT.—The agency shall provide the family residing in such a dwelling unit a 

period of 90 days or such longer period as the pubVerDate Sep 11 2014 04:22 Jun 09, 2018 Jkt 079006 PO 00000 Frm 00026 Fmt 6659 Sfmt 6601 E:\HR\OC\HR719.XXX HR719
27 

lic housing agency determines is reasonably necessary to lease a new unit, beginning upon termination of the contract, to lease a new residence 

with tenant-based rental assistance under this 

section. 

(II) AVAILABILITY OF PUBLIC HOUSING UNITS.—If 

the family is unable to lease such a new residence 

during such period, the public housing agency 

shall, at the option of the family, provide such 

family a preference for occupancy in a dwelling 

unit of public housing that is owned or operated 

by the agency that first becomes available for occupancy after the expiration of such period. 

(III) ASSISTANCE IN FINDING UNIT.—The public 

housing agency may provide assistance to the 

family in finding a new residence, including use of 

up to two months of any assistance amounts withheld or abated pursuant to clause (ii) or (iii), respectively, for costs directly associated with relocation of the family to a new residence, which 

shall include security deposits as necessary and 

may include reimbursements for reasonable moving expenses incurred by the household, as established by the Secretary. The agency may require 

that a family receiving assistance for a security 

deposit shall remit, to the extent of such assistance, the amount of any security deposit refunds 

made by the owner of the dwelling unit for which 

the lease was terminated. 

(viii) TENANT-CAUSED DAMAGES.—If a public housing 

agency determines that any damage to a dwelling unit 

that results in a failure of the dwelling unit to comply 

with housing quality standards under subparagraph 

(B), other than any damage resulting from ordinary 

use, was caused by the tenant, any member of the tenant’s household, or any guest or other person under 

the tenant’s control, the agency may waive the applicability of this subparagraph, except that this clause 

shall not exonerate a tenant from any liability otherwise existing under applicable law for damages to the 

premises caused by such tenant. 

(ix) APPLICABILITY.—This subparagraph shall apply 

to any dwelling unit for which a housing assistance 

payments contract is entered into or renewed after the 

date of the effectiveness of the regulations implementing this subparagraph. 

(H) INSPECTION GUIDELINES.—The Secretary shall establish procedural guidelines and performance standards to 

facilitate inspections of dwelling units and conform such 

inspections with practices utilized in the private housing 

market. Such guidelines and standards shall take into consideration variations in local laws and practices of public 

housing agencies and shall provide flexibility to authorities 

appropriate to facilitate efficient provision of assistance 

under this subsection. 

28 

(9) VACATED UNITS.—If an assisted family vacates a dwelling 

unit for which rental assistance is provided under a housing 

assistance payment contract before the expiration of the term 

of the lease for the unit, rental assistance pursuant to such 

contract may not be provided for the unit after the month during which the unit was vacated. 

(10) RENT.— (A) REASONABLENESS.—The rent for dwelling units for 

which a housing assistance payment contract is established under this subsection shall be reasonable in comparison with rents charged for comparable dwelling units 

in the private, unassisted local market. 

(B) NEGOTIATIONS.—A public housing agency (or other 

entity, as provided in paragraph (11)) shall, at the request 

of a family receiving tenant-based assistance under this 

subsection, assist that family in negotiating a reasonable 

rent with a dwelling unit owner. A public housing agency 

(or such other entity) shall review the rent for a unit 

under consideration by the family (and all rent increases 

for units under lease by the family) to determine whether 

the rent (or rent increase) requested by the owner is reasonable. If a public housing agency (or other such entity) 

determines that the rent (or rent increase) for a dwelling 

unit is not reasonable, the public housing agency (or other 

such entity) shall not make housing assistance payments 

to the owner under this subsection with respect to that 

unit. 

(C) UNITS EXEMPT FROM LOCAL RENT CONTROL.—If a 

dwelling unit for which a housing assistance payment contract is established under this subsection is exempt from 

local rent control provisions during the term of that contract, the rent for that unit shall be reasonable in comparison with other units in the market area that are exempt 

from local rent control provisions. 

(D) TIMELY PAYMENTS.—Each public housing agency 

shall make timely payment of any amounts due to a dwelling unit owner under this subsection. The housing assistance payment contract between the owner and the public 

housing agency may provide for penalties for the late payment of amounts due under the contract, which shall be 

imposed on the public housing agency in accordance with 

generally accepted practices in the local housing market. 

(E) PENALTIES.—Unless otherwise authorized by the Secretary, each public housing agency shall pay any penalties 

from administrative fees collected by the public housing 

agency, except that no penalty shall be imposed if the late 

payment is due to factors that the Secretary determines 

are beyond the control of the public housing agency. 

(F) TAX CREDIT PROJECTS.—In the case of a dwelling unit 

receiving tax credits pursuant to section 42 of the Internal 

Revenue Code of 1986 or for which assistance is provided 

under subtitle A of title II of the Cranston Gonzalez National Affordable Housing Act of 1990, for which a housing 

assistance contract not subject to paragraph (13) of this 

subsection is established, rent reasonableness shall be deVerDate Sep 11 2014 04:22 Jun 09, 2018 Jkt 079006 PO 00000 Frm 00028 Fmt 6659 Sfmt 6601 E:\HR\OC\HR719.XXX HR719
29 

termined as otherwise provided by this paragraph, except 

that— 

(i) comparison with rent for units in the private, unassisted local market shall not be required if the rent 

is equal to or less than the rent for other comparable 

units receiving such tax credits or assistance in the 

project that are not occupied by families assisted with 

tenant-based assistance under this subsection; and 

(ii) the rent shall not be considered reasonable for 

purposes of this paragraph if it exceeds the greater 

of— 

(I) the rents charged for other comparable units 

receiving such tax credits or assistance in the 

project that are not occupied by families assisted 

with tenant-based assistance under this subsection; and 

(II) the payment standard established by the 

public housing agency for a unit of the size involved. 

(11) LEASING OF UNITS OWNED BY PHA.— 

(A) INSPECTIONS AND RENT DETERMINATIONS.—If an eligible family assisted under this subsection leases a dwelling 

unit (other than a public housing dwelling unit) that is 

owned by a public housing agency administering assistance under this subsection, the Secretary shall require the 

unit of general local government or another entity approved by the Secretary, to make inspections required 

under paragraph (8) and rent determinations required 

under paragraph (10). The agency shall be responsible for 

any expenses of such inspections and determinations. 

(B) UNITS OWNED BY PHA.—For purposes of this subsection, the term ‘‘owned by a public housing agency’’ 

means, with respect to a dwelling unit, that the dwelling 

unit is in a project that is owned by such agency, by an 

entity wholly controlled by such agency, or by a limited liability company or limited partnership in which such agency (or an entity wholly controlled by such agency) holds a 

controlling interest in the managing member or general 

partner. A dwelling unit shall not be deemed to be owned 

by a public housing agency for purposes of this subsection 

because the agency holds a fee interest as ground lessor in 

the property on which the unit is situated, holds a security 

interest under a mortgage or deed of trust on the unit, or 

holds a non-controlling interest in an entity which owns 

the unit or in the managing member or general partner of 

an entity which owns the unit. 

(12) ASSISTANCE FOR RENTAL OF MANUFACTURED

HOUSING.— 

(A) IN GENERAL.—A public housing agency may make assistance payments in accordance with this subsection on 

behalf of a family that utilizes a manufactured home as a 

principal place of residenceand rents the real property on 

which the manufactured home owned by any such family 

is located. 

(B) RENT CALCULATION.— 

30 

(i) CHARGES INCLUDED.—For assistance pursuant to 

this paragraph, rent shall mean the sum of the monthly payments made by a family assisted under this 

paragraph to amortize the cost of purchasing the manufactured home, including any required insurance and 

property taxes, the monthly amount allowed for tenant-paid utilities, and the monthly rent charged for 

the real property on which the manufactured home is 

located, including monthly management and maintenance charges. 

(ii) MONTHLY ASSISTANCE PAYMENT.—The monthly 

assistance payment for a family assisted under this 

paragraph shall be determined in accordance with 

paragraph (2). If the amount of the monthly assistance 

payment for a family exceeds the monthly rent 

charged for the real property on which the manufactured home is located, including monthly management 

and maintenance charges, a public housing agency 

may pay the remainder to the family, lender or utility 

company, or may choose to make a single payment to 

the family for the entire monthly assistance amount. 

(13) PHA PROJECT-BASED ASSISTANCE.— (A) IN GENERAL.—A public housing agency may use 

amounts provided under an annual contributions contract 

under this subsection to enter into a housing assistance 

payment contract with respect to an existing, newly constructed, or rehabilitated project, that is attached to the 

project, subject to the limitations and requirements of this 

paragraph. 

(B) PERCENTAGE LIMITATION.— 

(i) IN GENERAL.—Subject to clause (ii), a public housing agency may use for project-based assistance under 

this paragraph not more than 20 percent of the authorized units for the agency. 

(ii) EXCEPTION.—A public housing agency may use 

up to an additional 10 percent of the authorized units 

for the agency for project-based assistance under this 

paragraph, to provide units that house individuals and 

families that meet the definition of homeless under 

section 103 of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11302), that house families with 

veterans, that provide supportive housing to persons 

with disabilities or elderly persons, or that are located 

in areas where vouchers under this subsection are difficult to use, as specified in subparagraph (D)(ii)(II). 

Any units of project-based assistance that are attached 

to units previously subject to federally required rent 

restrictions or receiving another type of long-term 

housing subsidy provided by the Secretary shall not 

count toward the percentage limitation under clause 

(i) of this subparagraph. The Secretary may, by regulation, establish additional categories for the exception 

under this clause. 

(C) CONSISTENCY WITH PHA PLAN AND OTHER GOALS.—A 

public housing agency may approve a housing assistance 

31 

payment contract pursuant to this paragraph only if the 

contract is consistent with— 

(i) the public housing agency plan for the agency approved under section 5A; and 

(ii) the goal of deconcentrating poverty and expanding housing and economic opportunities. 

(D) INCOME-MIXING REQUIREMENT.— 

(i) IN GENERAL.—Except as provided in clause (ii), 

not more than the greater of 25 dwelling units or 25 

percent of the dwelling units in any project may be assisted under a housing assistance payment contract 

for project-based assistance pursuant to this paragraph. For purposes of this subparagraph, the term 

‘‘project’’ means a single building, multiple contiguous 

buildings, or multiple buildings on contiguous parcels 

of land. 

(ii) EXCEPTIONS.— 

(I) CERTAIN FAMILIES.—The limitation under 

clause (i) shall not apply to dwelling units assisted 

under a contract that are exclusively made available to elderly families or to households eligible 

for supportive services that are made available to 

the assisted residents of the project, according to 

standards for such services the Secretary may establish. 

(II) CERTAIN AREAS.—With respect to areas in 

which tenant-based vouchers for assistance under 

this subsection are difficult to use, as determined 

by the Secretary, and with respect to census tracts 

with a poverty rate of 20 percent or less, clause (i) 

shall be applied by substituting ‘‘40 percent’’ for 

‘‘25 percent’’, and the Secretary may, by regulation, establish additional conditions. 

(III) CERTAIN CONTRACTS.—The limitation under 

clause (i) shall not apply with respect to contracts 

or renewal of contracts under which a greater percentage of the dwelling units in a project were assisted under a housing assistance payment contract for project-based assistance pursuant to this 

paragraph on the date of the enactment of the 

Housing Opportunity Through Modernization Act 

of 2016. 

(IV) CERTAIN PROPERTIES.—Any units of projectbased assistance under this paragraph that are 

attached to units previously subject to federally 

required rent restrictions or receiving other 

project-based assistance provided by the Secretary 

shall not count toward the percentage limitation 

imposed by this subparagraph (D). 

(iii) ADDITIONAL MONITORING AND OVERSIGHT REQUIREMENTS.—The Secretary may establish additional 

requirements for monitoring and oversight of projects 

in which more than 40 percent of the dwelling units 

are assisted under a housing assistance payment conVerDate Sep 11 2014 04:22 Jun 09, 2018 Jkt 079006 PO 00000 Frm 00031 Fmt 6659 Sfmt 6601 E:\HR\OC\HR719.XXX HR719
32 

tract for project-based assistance pursuant to this 

paragraph. 

(E) RESIDENT CHOICE REQUIREMENT.—A housing assistance payment contract pursuant to this paragraph shall 

provide as follows: 

(i) MOBILITY.—Each low-income family occupying a 

dwelling unit assisted under the contract may move 

from the housing at any time after the family has occupied the dwelling unit for 12 months. 

(ii) CONTINUED ASSISTANCE.—Upon such a move, the 

public housing agency shall provide the low-income 

family with tenant-based rental assistance under this 

section or such other tenant-based rental assistance 

that is subject to comparable income, assistance, rent 

contribution, affordability, and other requirements, as 

the Secretary shall provide by regulation. If such rental assistance is not immediately available to fulfill the 

requirement under the preceding sentence with respect to a low-income family, such requirement may be 

met by providing the family priority to receive the 

next voucher or other tenant-based rental assistance 

amounts that become available under the program 

used to fulfill such requirement. 

(F) CONTRACT TERM.— (i) TERM.—A housing assistance payment contract 

pursuant to this paragraph between a public housing 

agency and the owner of a project may have a term of 

up to 20 years, subject to— 

(I) the availability of sufficient appropriated 

funds for the purpose of renewing expiring contracts for assistance payments, as provided in appropriation Acts and in the agency’s annual contributions contract with the Secretary, provided 

that in the event of insufficient appropriated 

funds, payments due under contracts under this 

paragraph shall take priority if other cost-saving 

measures that do not require the termination of 

an existing contract are available to the agency; 

and 

(II) compliance with the inspection requirements under paragraph (8), except that the agency shall not be required to make biennial inspections of each assisted unit in the development. 

(ii) ADDITION OF ELIGIBLE UNITS.—Subject to the 

limitations of subparagraphs (B) and (D), the agency 

and the owner may add eligible units within the same 

project to a housing assistance payments contract at 

any time during the term thereof without being subject to any additional competitive selection procedures. 

(iii) HOUSING UNDER CONSTRUCTION OR RECENTLY

CONSTRUCTED.—An agency may enter into a housing 

assistance payments contract with an owner for any 

unit that does not qualify as existing housing and is 

under construction or recently has been constructed 

whether or not the agency has executed an agreement 

33 

to enter into a contract with the owner, provided that 

the owner demonstrates compliance with applicable 

requirements prior to execution of the housing assistance payments contract. This clause shall not subject 

a housing assistance payments contract for existing 

housing under this paragraph to such requirements or 

otherwise limit the extent to which a unit may be assisted as existing housing. 

(iv) ADDITIONAL CONDITIONS.—The contract may 

specify additional conditions, including with respect to 

continuation, termination, or expiration, and shall 

specify that upon termination or expiration of the contract without extension, each assisted family may elect 

to use its assistance under this subsection to remain 

in the same project if its unit complies with the inspection requirements under paragraph (8), the rent 

for the unit is reasonable as required by paragraph 

(10)(A), and the family pays its required share of the 

rent and the amount, if any, by which the unit rent 

(including the amount allowed for tenant-based utilities) exceeds the applicable payment standard. 

(G) EXTENSION OF CONTRACT TERM.—A public housing 

agency may enter into a contract with the owner of a 

project assisted under a housing assistance payment contract pursuant to this paragraph to extend the term of the 

underlying housing assistance payment contract for such 

period as the agency determines to be appropriate to 

achieve long-term affordability of the housing or to expand 

housing opportunities. Such contract may, at the election 

of the public housing agency and the owner of the project, 

specify that such contract shall be extended for renewal 

terms of up to 20 years each, if the agency makes the determination required by this subparagraph and the owner 

is in compliance with the terms of the contract. Such a 

contract shall provide that the extension of such term shall 

be contingent upon the future availability of appropriated 

funds for the purpose of renewing expiring contracts for 

assistance payments, as provided in appropriations Acts, 

and may obligate the owner to have such extensions of the 

underlying housing assistance payment contract accepted 

by the owner and the successors in interest of the owner. 

A public housing agency may agree to enter into such a 

contract at the time it enters into the initial agreement for 

a housing assistance payment contract or at any time 

thereafter that is before the expiration of the housing assistance payment contract. 

(H) RENT CALCULATION.—A housing assistance payment 

contract pursuant to this paragraph shall establish rents 

for each unit assisted in an amount that does not exceed 

110 percent of the applicable fair market rental (or any exception payment standard approved by the Secretary pursuant to paragraph (1)(D)), except that if a contract covers 

a dwelling unit that has been allocated low-income housing 

tax credits pursuant to section 42 of the Internal Revenue 

Code of 1986 (26 U.S.C. 42) and is not located in a qualiVerDate Sep 11 2014 04:22 Jun 09, 2018 Jkt 079006 PO 00000 Frm 00033 Fmt 6659 Sfmt 6601 E:\HR\OC\HR719.XXX HR719
34 

fied census tract (as such term is defined in subsection (d) 

of such section 42), the rent for such unit may be established at any level that does not exceed the rent charged 

for comparable units in the building that also receive the 

low-income housing tax credit but do not have additional 

rental assistance, except that in the case of a contract unit 

that has been allocated low-income housing tax credits and 

for which the rent limitation pursuant to such section 42 

is less than the amount that would otherwise be permitted 

under this subparagraph, the rent for such unit may, in 

the sole discretion of a public housing agency, be established at the higher section 8 rent, subject only to paragraph (10)(A). The rents established by housing assistance 

payment contracts pursuant to this paragraph may vary 

from the payment standards established by the public 

housing agency pursuant to paragraph (1)(B), but shall be 

subject to paragraph (10)(A). 

(I) RENT ADJUSTMENTS.—A housing assistance payments 

contract pursuant to this paragraph entered into after the 

date of the enactment of the Housing Opportunity Through 

Modernization Act of 2016 shall provide for annual rent 

adjustments upon the request of the owner, except that— 

(i) by agreement of the parties, a contract may allow 

a public housing agency to adjust the rent for covered 

units using an operating cost adjustment factor established by the Secretary pursuant to section 524(c) of 

the Multifamily Assisted Housing Reform and Affordability Act of 1997 (which shall not result in a negative adjustment), in which case the contract may require an additional adjustment, if requested, up to the 

reasonable rent periodically during the term of the 

contract, and shall require such an adjustment, if requested, upon extension pursuant to subparagraph 

(G); 

(ii) the adjusted rent shall not exceed the maximum 

rent permitted under subparagraph (H); 

(iii) the contract may provide that the maximum 

rent permitted for a dwelling unit shall not be less 

than the initial rent for the dwelling unit under the 

initial housing assistance payments contract covering 

the units; and 

(iv) the provisions of subsection (c)(2)(C) shall not 

apply. 

(J) TENANT SELECTION.—A public housing agency may 

select families to receive project-based assistance pursuant 

to this paragraph from its waiting list for assistance under 

this subsection or may permit owners to select applicants 

from site-based waiting lists as specified in this subparagraph. Eligibility for such project-based assistance shall be 

subject to the provisions of section 16(b) that apply to tenant-based assistance. The agency or owner may establish 

preferences or criteria for selection for a unit assisted 

under this paragraph that are consistent with the public 

housing agency plan for the agency approved under section 

5A and that give preference to families who qualify for volVerDate Sep 11 2014 04:22 Jun 09, 2018 Jkt 079006 PO 00000 Frm 00034 Fmt 6659 Sfmt 6601 E:\HR\OC\HR719.XXX HR719
35 

untary services, including disability-specific services, offered in conjunction with assisted units. Any family that 

rejects an offer of project-based assistance under this paragraph or that is rejected for admission to a project by the 

owner or manager of a project assisted under this paragraph shall retain its place on the waiting list as if the 

offer had not been made. A public housing agency may establish and utilize procedures for owner-maintained sitebased waiting lists, under which applicants may apply at, 

or otherwise designate to the public housing agency, the 

project or projects in which they seek to reside, except that 

all eligible applicants on the waiting list of an agency for 

assistance under this subsection shall be permitted to 

place their names on such separate list, subject to policies 

and procedures established by the Secretary. All such procedures shall comply with title VI of the Civil Rights Act 

of 1964, the Fair Housing Act, section 504 of the Rehabilitation Act of 1973, and other applicable civil rights laws. 

The owner or manager of a project assisted under this 

paragraph shall not admit any family to a dwelling unit 

assisted under a contract pursuant to this paragraph other 

than a family referred by the public housing agency from 

its waiting list, or a family on a site-based waiting list that 

complies with the requirements of this subparagraph. A 

public housing agency shall disclose to each applicant all 

other options in the selection of a project in which to reside 

that are provided by the public housing agency and are 

available to the applicant. 

(K) VACATED UNITS.—Notwithstanding paragraph (9), a 

housing assistance payment contract pursuant to this 

paragraph may provide as follows: 

(i) PAYMENT FOR VACANT UNITS.—That the public 

housing agency may, in its discretion, continue to provide assistance under the contract, for a reasonable 

period not exceeding 60 days, for a dwelling unit that 

becomes vacant, but only: (I) if the vacancy was not 

the fault of the owner of the dwelling unit; and (II) the 

agency and the owner take every reasonable action to 

minimize the likelihood and extent of any such vacancy. Rental assistance may not be provided for a vacant unit after the expiration of such period. 

(ii) REDUCTION OF CONTRACT.—That, if despite reasonable efforts of the agency and the owner to fill a 

vacant unit, no eligible family has agreed to rent the 

unit within 120 days after the owner has notified the 

agency of the vacancy, the agency may reduce its 

housing assistance payments contract with the owner 

by the amount equivalent to the remaining months of 

subsidy attributable to the vacant unit. Amounts 

deobligated pursuant to such a contract provision shall 

be available to the agency to provide assistance under 

this subsection. 

Eligible applicants for assistance under this subsection 

may enforce provisions authorized by this subparagraph. 

36 

(L) USE IN COOPERATIVE HOUSING AND ELEVATOR BUILDINGS.—A public housing agency may enter into a housing 

assistance payments contract under this paragraph with 

respect to— 

(i) dwelling units in cooperative housing; and 

(ii) notwithstanding subsection (c), dwelling units in 

a high-rise elevator project, including such a project 

that is occupied by families with children, without review and approval of the contract by the Secretary. 

(M) REVIEWS.— 

(i) SUBSIDY LAYERING.—A subsidy layering review in 

accordance with section 102(d) of the Department of 

Housing and Urban Development Reform Act of 1989 

(42 U.S.C. 3545(d)) shall not be required for assistance 

under this paragraph in the case of a housing assistance payments contract for an existing project, or if a 

subsidy layering review has been conducted by the applicable State or local agency. 

(ii) ENVIRONMENTAL REVIEW.—A public housing 

agency shall not be required to undertake any environmental review before entering into a housing assistance payments contract under this paragraph for 

an existing project, except to the extent such a review 

is otherwise required by law or regulation relating to 

funding other than housing assistance payments. 

(N) STRUCTURE OWNED BY AGENCY.—A public housing 

agency engaged in an initiative to improve, develop, or replace a public housing property or site may attach assistance to an existing, newly constructed, or rehabilitated 

structure in which the agency has an ownership interest 

or which the agency has control of without following a 

competitive process, provided that the agency has notified 

the public of its intent through its public housing agency 

plan and subject to the limitations and requirements of 

this paragraph. 

(O) SPECIAL PURPOSE VOUCHERS.—A public housing 

agency that administers vouchers authorized under subsection (o)(19) or (x) of this section may provide such assistance in accordance with the limitations and requirements of this paragraph, without additional requirements 

for approval by the Secretary. 

(14) INAPPLICABILITY TO TENANT-BASED ASSISTANCE.—Subsection (c) shall not apply to tenant-based assistance under 

this subsection. 

(15) HOMEOWNERSHIP OPTION.— 

(A) IN GENERAL.—A public housing agency providing assistance under this subsection may, at the option of the 

agency, provide assistance for homeownership under subsection (y). 

(B) ALTERNATIVE ADMINISTRATION.—A public housing 

agency may contract with a nonprofit organization to administer a homeownership program under subsection (y). 

(16) RENTAL VOUCHERS FOR RELOCATION OF WITNESSES AND

VICTIMS OF CRIME.— 

37 

(A) WITNESSES.—Of amounts made available for assistance under this subsection in each fiscal year, the Secretary, in consultation with the Inspector General, shall 

make available such sums as may be necessary for the relocation of witnesses in connection with efforts to combat 

crime in public and assisted housing pursuant to requests 

from law enforcement or prosecution agencies. 

(B) VICTIMS OF CRIME.— (i) IN GENERAL.—Of amounts made available for assistance under this section in each fiscal year, the Secretary shall make available such sums as may be necessary for the relocation of families residing in public 

housing who are victims of a crime of violence (as that 

term is defined in section 16 of title 18, United States 

Code) that has been reported to an appropriate law 

enforcement agency. 

(ii) NOTICE.—A public housing agency that receives 

amounts under this subparagraph shall establish procedures for providing notice of the availability of that 

assistance to families that may be eligible for that assistance. 

(17) DEED RESTRICTIONS.—Assistance under this subsection 

may not be used in any manner that abrogates any local deed 

restriction that applies to any housing consisting of 1 to 4 

dwelling units. This paragraph may not be construed to affect 

the provisions or applicability of the Fair Housing Act. 

(18) RENTAL ASSISTANCE FOR ASSISTED LIVING FACILITIES.— (A) IN GENERAL.—A public housing agency may make assistance payments on behalf of a family that uses an assisted living facility as a principal place of residence and 

that uses such supportive services made available in the 

facility as the agency may require. Such payments may be 

made only for covering costs of rental of the dwelling unit 

in the assisted living facility and not for covering any portion of the cost of residing in such facility that is attributable to service relating to assisted living. 

(B) RENT CALCULATION.— (i) CHARGES INCLUDED.—For assistance pursuant to 

this paragraph, the rent of the dwelling unit that is an 

assisted living facility with respect to which assistance 

payments are made shall include maintenance and 

management charges related to the dwelling unit and 

tenant-paid utilities. Such rent shall not include any 

charges attributable to services relating to assisted living. 

(ii) PAYMENT STANDARD.—In determining the monthly assistance that may be paid under this paragraph 

on behalf of any family residing in an assisted living 

facility, the public housing agency shall utilize the 

payment standard established under paragraph (1), 

for the market area in which the assisted living facility is located, for the applicable size dwelling unit. 

(iii) MONTHLY ASSISTANCE PAYMENT.—The monthly 

assistance payment for a family assisted under this 

paragraph shall be determined in accordance with 

38 

paragraph (2) (using the rent and payment standard 

for the dwelling unit as determined in accordance with 

this subsection), except that a family may be required 

at the time the family initially receives such assistance to pay rent in an amount exceeding 40 percent of 

the monthly adjusted income of the family by such an 

amount or percentage that is reasonable given the 

services and amenities provided and as the Secretary 

deems appropriate.. 

(C) DEFINITION.—For the purposes of this paragraph, the 

term ‘‘assisted living facility’’ has the meaning given that 

term in section 232(b) of the National Housing Act (12 

U.S.C. 1715w(b)), except that such a facility may be contained within a portion of a larger multifamily housing 

project. 

(19) RENTAL VOUCHERS FOR VETERANS AFFAIRS SUPPORTED

HOUSING PROGRAM.— 

(A) SET ASIDE.—Subject to subparagraph (C), the Secretary shall set aside, from amounts made available for 

rental assistance under this subsection, the amounts specified in subparagraph (B) for use only for providing such assistance through a supported housing program administered in conjunction with the Department of Veterans Affairs. Such program shall provide rental assistance on behalf of homeless veterans who have chronic mental illnesses or chronic substance use disorders, shall require 

agreement of the veteran to continued treatment for such 

mental illness or substance use disorder as a condition of 

receipt of such rental assistance, and shall ensure such 

treatment and appropriate case management for each veteran receiving such rental assistance. 

(B) AMOUNT.—The amount specified in this subparagraph is— 

(i) for fiscal year 2007, the amount necessary to provide 500 vouchers for rental assistance under this subsection; 

(ii) for fiscal year 2008, the amount necessary to 

provide 1,000 vouchers for rental assistance under this 

subsection; 

(iii) for fiscal year 2009, the amount necessary to 

provide 1,500 vouchers for rental assistance under this 

subsection; 

(iv) for fiscal year 2010, the amount necessary to 

provide 2,000 vouchers for rental assistance under this 

subsection; and 

(v) for fiscal year 2011, the amount necessary to provide 2,500 vouchers for rental assistance under this 

subsection. 

(C) FUNDING THROUGH INCREMENTAL ASSISTANCE.—In 

any fiscal year, to the extent that this paragraph requires 

the Secretary to set aside rental assistance amounts for 

use under this paragraph in an amount that exceeds the 

amount set aside in the preceding fiscal year, such requirement shall be effective only to such extent or in such 

amounts as are or have been provided in appropriation 

39 

Acts for such fiscal year for incremental rental assistance 

under this subsection. 

(20) COLLECTION OF UTILITY DATA.— 

(A) PUBLICATION.—The Secretary shall, to the extent 

that data can be collected cost effectively, regularly publish 

such data regarding utility consumption and costs in local 

areas as the Secretary determines will be useful for the establishment of allowances for tenant-paid utilities for families assisted under this subsection. 

(B) USE OF DATA.—The Secretary shall provide such data 

in a manner that— 

(i) avoids unnecessary administrative burdens for 

public housing agencies and owners; and 

(ii) protects families in various unit sizes and building types, and using various utilities, from high rent 

and utility cost burdens relative to income. 

(21) RENTAL VOUCHER DEMONSTRATION PROGRAM FOR SUPPORTIVE AND TRANSITIONAL HOUSING FOR INDIVIDUALS RECOVERING FROM OPIOID USE DISORDERS OR OTHER SUBSTANCE USE

DISORDERS.— 

(A) ESTABLISHMENT.—The Secretary shall establish a 

demonstration program under which the Secretary shall set 

aside, allocate, and distribute directly to eligible entities, 

from amounts made available for rental assistance under 

this subsection, the amounts specified in subparagraph (B) 

for an eligible entity to provide a voucher for such assistance to a covered individual through a supportive and 

transitional housing program that provides treatment for 

opioid use disorders or other substance use disorders (as 

applicable), job skills training, and such assistance for a 

period of 12 to 24 months. 

(B) AMOUNT.—The amount specified in this subparagraph is, for each of fiscal years 2019 through 2023, the 

amount necessary to provide the lesser of— 

(i) 0.5 percent of the total number of vouchers allocated under this subsection during the fiscal year ending immediately before the date of the enactment of this 

paragraph; or 

(ii) 10,000 vouchers. 

(C) CRITERIA FOR ELIGIBLE ENTITIES.—And eligible entity 

shall— 

(i) provide an evidence-based treatment program and 

a job skills training program for individuals recovering 

from an opioid use disorder or other substance use disorder, as applicable, that meet standards established 

by the Secretary; and 

(ii) demonstrate prior experience administering rental assistance vouchers, demonstrate prior experience 

administering transitional housing programs under 

the McKinney-Vento Homeless Act, or demonstrate a 

partnership with a public housing agency or a housing 

program of a State, unit of local government, or Indian 

tribe (as such term is defined in section 4 of the Native 

American Housing and Self-Determination Act of 1996 

40 

(25 U.S.C. 4103)) that ensures effective administration 

of rental assistance vouchers. 

(D) APPLICATION.—To receive a rental assistance voucher 

under this paragraph, an eligible entity shall submit an 

application to the Secretary that shall include— 

(i) a description of the terms of treatment program, 

job skills training, and rental assistance to be provided 

to a covered individual, and assurances that such description shall be communicated to covered individuals 

that receive vouchers pursuant to the demonstration 

program established under this paragraph; and 

(ii) a transitional plan that begins on the date on 

which a covered individual completes the treatment 

program of the eligible entity that includes information 

on additional treatment, job skills training, and housing resources and services available to such covered individual. 

(E) SELECTION.—In selecting eligible entities to receive 

rental assistance vouchers under this paragraph, the Secretary shall— 

(i) ensure that such eligible entities— 

(I) are diverse; 

(II) represent an appropriate balance of eligible 

entities located in urban and rural areas; and 

(III) provide supportive and transitional housing 

programs in diverse geographic regions with high 

rates of mortality due to opioid use disorders or 

other substance use disorders, as applicable, based 

on data of the Centers for Disease Control and Prevention; and 

(ii) consider— 

(I) the success of each recipient eligible entity at 

helping individuals complete the treatment program of the eligible entity and refrain from opioid 

or other substance usage, as applicable; 

(II) the type of job skills training program provided by the eligible entity; 

(III) the percentage of participants in the job 

skills training program that gain and maintain 

employment; 

(IV) the percentage of participants in the treatment program of the eligible entity that— 

(aa) do not relapse into opioid or other substance usage, as applicable; and 

(bb) do not receive Federal assistance for 

treatment of an opioid use disorder or other 

substance use disorder, as applicable, after 

completion of the program. 

(F) TRANSFER OF VOUCHER.—Upon termination of the 

provision of rental assistance through a voucher to a covered individual, the eligible entity that initially offered 

such voucher may use such voucher to provide rental assistance to another covered individual. 

(G) DURATION.—The Secretary shall not make rental assistance available under this paragraph after the expiration 

41 

of the 5-year period beginning on the date of the enactment 

of this paragraph. 

(H) REPORTS.— 

(i) BY THE ELIGIBLE ENTITY.—An eligible entity that 

receives a rental assistance voucher under this paragraph shall submit to the Secretary— 

(I) annually, the transitional plan described in 

subparagraph (D)(ii) and information on each covered individual’s housing upon termination of the 

provision of rental assistance through a voucher to 

such covered individual in a manner that protects 

the privacy of such covered individual; and 

(II) not later than 4 years after the date of the 

enactment of this paragraph, a plan describing the 

treatment and housing options for any covered individual assisted by such voucher who will not 

have completed the program before the day that is 

5 years after such date of enactment. 

(ii) BY THE SECRETARY.—The Secretary shall submit 

to Congress a report that analyzes the impact of rental 

assistance provided under this paragraph— 

(I) not later than 2 years after the date of the enactment of this paragraph; and 

(II) not later than 4 years after the date of the 

enactment of this paragraph, that includes recommendations for the continuation or expansion of 

the program established under this paragraph and 

improving the process for providing such assistance. 

(I) DEFINITIONS.—In this paragraph: 

(i) ELIGIBLE ENTITY.—The term ‘‘eligible entity’’ 

means a nonprofit organization that meets the criteria 

described under subparagraph (C). 

(ii) COVERED INDIVIDUAL.—The term ‘‘covered individual’’ means an individual recovering from an opioid 

use disorder or other substance use disorder. 

(p) In order to assist elderly families (as defined in section 

3(b)(3)) who elect to live in a shared housing arrangement in which 

they benefit as a result of sharing the facilities of a dwelling with 

others in a manner that effectively and efficiently meets their housing needs and thereby reduces their costs of housing, the Secretary 

shall permit assistance provided under the existing housing and 

moderate rehabilitation programs to be used by such families in 

such arrangements. In carrying out this subsection, the Secretary 

shall issue minimum habitability standards for the purpose of assuring decent, safe, and sanitary housing for such families while 

taking into account the special circumstances of shared housing. 

(q) ADMINISTRATIVE FEES.— 

(1) FEE FOR ONGOING COSTS OF ADMINISTRATION.— 

(A) IN GENERAL.—The Secretary shall establish fees for 

the costs of administering the tenant-based assistance, certificate, voucher, and moderate rehabilitation programs 

under this section. 

(B) FISCAL YEAR 1999.— 

42 

(i) CALCULATION.—For fiscal year 1999, the fee for 

each month for which a dwelling unit is covered by an 

assistance contract shall be— 

(I) in the case of a public housing agency that, 

on an annual basis, is administering a program 

for not more than 600 dwelling units, 7.65 percent 

of the base amount; and 

(II) in the case of an agency that, on an annual 

basis, is administering a program for more than 

600 dwelling units (aa) for the first 600 units, 7.65 

percent of the base amount, and (bb) for any additional dwelling units under the program, 7.0 percent of the base amount. 

(ii) BASE AMOUNT.—For purposes of this subparagraph, the base amount shall be the higher of— 

(I) the fair market rental established under section 8(c) of this Act (as in effect immediately before the effective date under section 503(a) of the 

Quality Housing and Work Responsibility Act of 

1998) for fiscal year 1993 for a 2-bedroom existing 

rental dwelling unit in the market area of the 

agency, and 

(II) the amount that is the lesser of (aa) such 

fair market rental for fiscal year 1994, or (bb) 

103.5 percent of the amount determined under 

clause (i), 

adjusted based on changes in wage data or other objectively measurable data that reflect the costs of administering the program, as determined by the Secretary. 

The Secretary may require that the base amount be 

not less than a minimum amount and not more than 

a maximum amount. 

(C) SUBSEQUENT FISCAL YEARS.—For subsequent fiscal 

years, the Secretary shall publish a notice in the Federal 

Register, for each geographic area, establishing the 

amount of the fee that would apply for public housing 

agencies administering the program, based on changes in 

wage data or other objectively measurable data that reflect 

the costs of administering the program, as determined by 

the Secretary. 

(D) INCREASE.—The Secretary may increase the fee if 

necessary to reflect the higher costs of administering small 

programs and programs operating over large geographic 

areas. 

(E) DECREASE.—The Secretary may decrease the fee for 

units owned by a public housing agency to reflect reasonable costs of administration. 

(2) FEE FOR PRELIMINARY EXPENSES.—The Secretary shall 

also establish reasonable fees (as determined by the Secretary) 

for— 

(A) the costs of preliminary expenses, in the amount of 

$500, for a public housing agency, except that such fee 

shall apply to an agency only in the first year that the 

agency administers a tenant-based assistance program 

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43 

fective date under section 503(a) of the Quality Housing 

and Work Responsibility Act of 1998, the agency was not 

administering a tenant-based assistance program under 

the United States Housing Act of 1937 (as in effect immediately before such effective date), in connection with its 

initial increment of assistance received; 

(B) the costs incurred in assisting families who experience difficulty (as determined by the Secretary) in obtaining appropriate housing under the programs; and 

(C) extraordinary costs approved by the Secretary. 

(3) TRANSFER OF FEES IN CASES OF CONCURRENT GEOGRAPHICAL JURISDICTION.—In each fiscal year, if any public 

housing agency provides tenant-based assistance under this 

section on behalf of a family who uses such assistance for a 

dwelling unit that is located within the jurisdiction of such 

agency but is also within the jurisdiction of another public 

housing agency, the Secretary shall take such steps as may be 

necessary to ensure that the public housing agency that provides the services for a family receives all or part of the administrative fee under this section (as appropriate). 

(4) APPLICABILITY.—This subsection shall apply to fiscal year 

1999 and fiscal years thereafter. 

(r) PORTABILITY.—(1) IN GENERAL.—(A) Any family receiving tenant-based assistance under subsection (o) may receive such assistance to rent an eligible dwelling unit if the dwelling unit to which 

the family moves is within any area in which a program is being 

administered under this section. 

(B)(i) Notwithstanding subparagraph (A) and subject to any exceptions established under clause (ii) of this subparagraph, a public 

housing agency may require that any family not living within the 

jurisdiction of the public housing agency at the time the family applies for assistance from the agency shall, during the 12-month period beginning on the date of initial receipt of housing assistance 

made available on behalf of the family from such agency, lease and 

occupy an eligible dwelling unit located within the jurisdiction 

served by the agency. 

(ii) The Secretary may establish such exceptions to the authority 

of public housing agencies established under clause (i). 

(2) The public housing agency having authority with respect to 

the dwelling unit to which a family moves under this subsection 

shall have the responsibility of carrying out the provisions of this 

subsection with respect to the family. 

(3) In providing assistance under subsection (o) for any fiscal 

year, the Secretary shall give consideration to any reduction in the 

number of resident families incurred by a public housing agency in 

the preceding fiscal year as a result of the provisions of this subsection. The Secretary shall establish procedures for the compensation of public housing agencies that issue vouchers to families that 

move into or out of the jurisdiction of the public housing agency 

under portability procedures. The Secretary may reserve amounts 

available for assistance under subsection (o) to compensate those 

public housing agencies. 

(4) The provisions of this subsection may not be construed to restrict any authority of the Secretary under any other provision of 

law to provide for the portability of assistance under this section. 

44 

(5) LEASE VIOLATIONS.—A family may not receive a voucher from 

a public housing agency and move to another jurisdiction under the 

tenant-based assistance program if the family has moved out of the 

assisted dwelling unit of the family in violation of a lease, except 

that a family may receive a voucher from a public housing agency 

and move to another jurisdiction under the tenant-based assistance 

program if the family has complied with all other obligations of the 

section 8 program and has moved out of the assisted dwelling unit 

in order to protect the health or safety of an individual who is or 

has been the victim of domestic violence, dating violence, or stalking and who reasonably believed he or she was imminently threatened by harm from further violence if he or she remained in the 

assisted dwelling unit. 

(s) In selecting families for the provision of assistance under this 

section (including subsection (o)), a public housing agency may not 

exclude or penalize a family solely because the family resides in a 

public housing project. 

(t) ENHANCED VOUCHERS.— 

(1) IN GENERAL.—Enhanced voucher assistance under this 

subsection for a family shall be voucher assistance under subsection (o), except that under such enhanced voucher assistance— 

(A) subject only to subparagraph (D), the assisted family 

shall pay as rent no less than the amount the family was 

paying on the date of the eligibility event for the project 

in which the family was residing on such date; 

(B) the assisted family may elect to remain in the same 

project in which the family was residing on the date of the 

eligibility event for the project, and if, during any period 

the family makes such an election and continues to so reside, the rent for the dwelling unit of the family in such 

project exceeds the applicable payment standard established pursuant to subsection (o) for the unit, the amount 

of rental assistance provided on behalf of the family shall 

be determined using a payment standard that is equal to 

the rent for the dwelling unit (as such rent may be increased from time-to-time), subject to paragraph (10)(A) of 

subsection (o) and any other reasonable limit prescribed by 

the Secretary, except that a limit shall not be considered 

reasonable for purposes of this subparagraph if it adversely affects such assisted families; 

(C) subparagraph (B) of this paragraph shall not apply 

and the payment standard for the dwelling unit occupied 

by the family shall be determined in accordance with subsection (o) if— 

(i) the assisted family moves, at any time, from such 

project; or 

(ii) the voucher is made available for use by any 

family other than the original family on behalf of 

whom the voucher was provided; and 

(D) if the annual adjusted income of the assisted family 

declines to a significant extent, the percentage of annual 

adjusted income paid by the family for rent shall not exceed the greater of 30 percent or the percentage of annual 

45 

adjusted income paid at the time of the eligibility event for 

the project. 

(2) ELIGIBILITY EVENT.—For purposes of this subsection, the 

term ‘‘eligibility event’’ means, with respect to a multifamily 

housing project, the prepayment of the mortgage on such housing project, the voluntary termination of the insurance contract 

for the mortgage for such housing project (including any such 

mortgage prepayment during fiscal year 1996 or a fiscal year 

thereafter or any insurance contract voluntary termination 

during fiscal year 1996 or a fiscal year thereafter), the termination or expiration of the contract for rental assistance under 

section 8 of the United States Housing Act of 1937 for such 

housing project (including any such termination or expiration 

during fiscal years after fiscal year 1994 prior to the effective 

date of the Departments of Veterans Affairs and Housing and 

Urban Development, and Independent Agencies Appropriations 

Act, 2001), or the transaction under which the project is preserved as affordable housing, that, under paragraphs (3) and 

(4) of section 515(c), section 524(d) of the Multifamily Assisted 

Housing Reform and Affordability Act of 1997 (42 U.S.C. 1437f 

note), section 223(f) of the Low-Income Housing Preservation 

and Resident Homeownership Act of 1990 (12 U.S.C. 4113(f)), 

or section 201(p) of the Housing and Community Development 

Amendments of 1978 (12 U.S.C. 1715z–1a(p)), results in tenants in such housing project being eligible for enhanced voucher assistance under this subsection. 

(3) TREATMENT OF ENHANCED VOUCHERS PROVIDED UNDER

OTHER AUTHORITY.— (A) IN GENERAL.—Notwithstanding any other provision 

of law, any enhanced voucher assistance provided under 

any authority specified in subparagraph (B) shall (regardless of the date that the amounts for providing such assistance were made available) be treated, and subject to the 

same requirements, as enhanced voucher assistance under 

this subsection. 

(B) IDENTIFICATION OF OTHER AUTHORITY.—The authority specified in this subparagraph is the authority under— 

(i) the 10th, 11th, and 12th provisos under the ‘‘Preserving Existing Housing Investment’’ account in title 

II of the Departments of Veterans Affairs and Housing 

and Urban Development, and Independent Agencies 

Appropriations Act, 1997 (Public Law 104–204; 110 

Stat. 2884), pursuant to such provisos, the first proviso under the ‘‘Housing Certificate Fund’’ account in 

title II of the Departments of Veterans Affairs and 

Housing and Urban Development, and Independent 

Agencies Appropriations Act, 1998 (Public Law 105– 

65; 111 Stat. 1351), or the first proviso under the 

‘‘Housing Certificate Fund’’ account in title II of the 

Departments of Veterans Affairs and Housing and 

Urban Development, and Independent Agencies Appropriations Act, 1999 (Public Law 105–276; 112 Stat. 

2469); and 

(ii) paragraphs (3) and (4) of section 515(c) of the 

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46 

ability Act of 1997 (42 U.S.C. 1437f note), as in effect 

before the enactment of this Act. 

(4) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated for each of fiscal years 2000, 2001, 

2002, 2003, and 2004 such sums as may be necessary for enhanced voucher assistance under this subsection. 

(u) In the case of low-income families living in rental projects rehabilitated under section 17 of this Act or section 533 of the Housing Act of 1949 before rehabilitation— 

(1) vouchers under this section shall be made for families 

who are required to move out of their units because of the 

physical rehabilitation activities or because of overcrowding; 

(2) at the discretion of each public housing agency or other 

agency administering the allocation of assistance or vouchers 

under this section may be made for families who would have 

to pay more than 30 percent of their adjusted income for rent 

after rehabilitation whether they choose to remain in, or to 

move from, the project; and 

(3) the Secretary shall allocate assistance for vouchers under 

this section to ensure that sufficient resources are available to 

address the physical or economic displacement, or potential 

economic displacement, of existing tenants pursuant to paragraphs (1) and (2). 

(v) The Secretary may extend expiring contracts entered into 

under this section for project-based loan management assistance to 

the extent necessary to prevent displacement of low-income families receiving such assistance as of September 30, 1996. 

(x) FAMILY UNIFICATION.— (1) INCREASE IN BUDGET AUTHORITY.—The budget authority 

available under section 5(c) for assistance under section 8(b) is 

authorized to be increased by $100,000,000 on or after October 

1, 1992, and by $104,200,000 on or after October 1, 1993. 

(2) USE OF FUNDS.—The amounts made available under this 

subsection shall be used only in connection with tenant-based 

assistance under section 8 on behalf of (A) any family (i) who 

is otherwise eligible for such assistance, and (ii) who the public 

child welfare agency for the jurisdiction has certified is a family for whom the lack of adequate housing is a primary factor 

in the imminent placement of the family’s child or children in 

out-of-home care or the delayed discharge of a child or children 

to the family from out-of-home care and (B) for a period not to 

exceed 36 months, otherwise eligible youths who have attained 

at least 18 years of age and not more than 24 years of age and 

who have left foster care, or will leave foster care within 90 

days, in accordancewith a transition plan described in section 

475(5)(H)of the Social Security Act, and is homeless or is at 

riskof becoming homeless at age 16 or older. 

(3) ALLOCATION.—The amounts made available under this 

subsection shall be allocated by the Secretary through a national competition among applicants based on demonstrated 

need for assistance under this subsection. To be considered for 

assistance, an applicant shall submit to the Secretary a written proposal containing a report from the public child welfare 

agency serving the jurisdiction of the applicant that describes 

how a lack of adequate housing in the jurisdiction is resulting 

47 

in the initial or prolonged separation of children from their 

families, and how the applicant will coordinate with the public 

child welfare agency to identify eligible families and provide 

the families with assistance under this subsection. 

(4) COORDINATION BETWEEN PUBLIC HOUSING AGENCIES AND

PUBLIC CHILD WELFARE AGENCIES.—The Secretary shall, not 

later than the expiration of the 180-day period beginning on 

the date of the enactment of the Housing Opportunity Through 

Modernization Act of 2016 and after consultation with other 

appropriate Federal agencies, issue guidance to improve coordination between public housing agencies and public child welfare agencies in carrying out the program under this subsection, which shall provide guidance on— 

(A) identifying eligible recipients for assistance under 

this subsection; 

(B) coordinating with other local youth and family providers in the community and participating in the Continuum of Care program established under subtitle C of 

title IV of the McKinney-Vento Homeless Assistance Act 

(42 U.S.C. 11381 et seq.); 

(C) implementing housing strategies to assist eligible 

families and youth; 

(D) aligning system goals to improve outcomes for families and youth and reducing lapses in housing for families 

and youth; and 

(E) identifying resources that are available to eligible 

families and youth to provide supportive services available 

through parts B and E of title IV of the Social Security Act 

(42 U.S.C. 621 et seq.; 670 et seq.) or that the head of 

household of a family or youth may be entitled to receive 

under section 477 of the Social Security Act (42 U.S.C. 

677). 

(5) DEFINITIONS.—For purposes of this subsection: 

(A) APPLICANT.—The term ‘‘applicant’’ means a public 

housing agency or any other agency responsible for administering assistance under section 8. 

(B) PUBLIC CHILD WELFARE AGENCY.—The term ‘‘public 

child welfare agency’’ means the public agency responsible 

under applicable State law for determining that a child is 

at imminent risk of placement in out-of-home care or that 

a child in out-of-home care under the supervision of the 

public agency may be returned to his or her family. 

(y) HOMEOWNERSHIP OPTION.— 

(1) USE OF ASSISTANCE FOR HOMEOWNERSHIP.—A public 

housing agency providing tenant-based assistance on behalf of 

an eligible family under this section may provide assistance for 

an eligible family that purchases a dwelling unit (including a 

unit under a lease-purchase agreement) that will be owned by 

1 or more members of the family, and will be occupied by the 

family, if the family— 

(A) is a first-time homeowner, or owns or is acquiring 

shares in a cooperative; 

(B) demonstrates that the family has income from employment or other sources (other than public assistance, 

except that the Secretary may provide for the considerVerDate Sep 11 2014 04:22 Jun 09, 2018 Jkt 079006 PO 00000 Frm 00047 Fmt 6659 Sfmt 6601 E:\HR\OC\HR719.XXX HR719
48 

ation of public assistance in the case of an elderly family 

or a disabled family), as determined in accordance with requirements of the Secretary, that is not less than twice the 

payment standard established by the public housing agency (or such other amount as may be established by the 

Secretary); 

(C) except as provided by the Secretary, demonstrates at 

the time the family initially receives tenant-based assistance under this subsection that one or more adult members of the family have achieved employment for the period as the Secretary shall require; 

(D) participates in a homeownership and housing counseling program provided by the agency; and 

(E) meets any other initial or continuing requirements 

established by the public housing agency in accordance 

with requirements established by the Secretary. 

(2) DETERMINATION OF AMOUNT OF ASSISTANCE.— 

(A) MONTHLY EXPENSES NOT EXCEEDING PAYMENT STANDARD.—If the monthly homeownership expenses, as determined in accordance with requirements established by the 

Secretary, do not exceed the payment standard, the 

monthly assistance payment shall be the amount by which 

the homeownership expenses exceed the highest of the following amounts, rounded to the nearest dollar: 

(i) 30 percent of the monthly adjusted income of the 

family. 

(ii) 10 percent of the monthly income of the family. 

(iii) If the family is receiving payments for welfare 

assistance from a public agency, and a portion of those 

payments, adjusted in accordance with the actual 

housing costs of the family, is specifically designated 

by that agency to meet the housing costs of the family, 

the portion of those payments that is so designated. 

(B) MONTHLY EXPENSES EXCEED PAYMENT STANDARD.—If 

the monthly homeownership expenses, as determined in 

accordance with requirements established by the Secretary, exceed the payment standard, the monthly assistance payment shall be the amount by which the applicable 

payment standard exceeds the highest of the amounts 

under clauses (i), (ii), and (iii) of subparagraph (A). 

(3) INSPECTIONS AND CONTRACT CONDITIONS.— 

(A) IN GENERAL.—Each contract for the purchase of a 

unit to be assisted under this section shall— 

(i) provide for pre-purchase inspection of the unit by 

an independent professional; and 

(ii) require that any cost of necessary repairs be paid 

by the seller. 

(B) ANNUAL INSPECTIONS NOT REQUIRED.—The requirement under subsection (o)(8)(A)(ii) for annual inspections 

shall not apply to units assisted under this section. 

(4) OTHER AUTHORITY OF THE SECRETARY.—The Secretary 

may— 

(A) limit the term of assistance for a family assisted 

under this subsection; and 

49 

(B) modify the requirements of this subsection as the 

Secretary determines to be necessary to make appropriate 

adaptations for lease-purchase agreements. 

(5) INAPPLICABILITY OF CERTAIN PROVISIONS.—Assistance 

under this subsection shall not be subject to the requirements 

of the following provisions: 

(A) Subsection (c)(3)(B) of this section. 

(B) Subsection (d)(1)(B)(i) of this section. 

(C) Any other provisions of this section governing maximum amounts payable to owners and amounts payable by 

assisted families. 

(D) Any other provisions of this section concerning contracts between public housing agencies and owners. 

(E) Any other provisions of this Act that are inconsistent 

with the provisions of this subsection. 

(6) REVERSION TO RENTAL STATUS.— 

(A) FHA-INSURED MORTGAGES.—If a family receiving assistance under this subsection for occupancy of a dwelling 

defaults under a mortgage for the dwelling insured by the 

Secretary under the National Housing Act, the family may 

not continue to receive rental assistance under this section 

unless the family (i) transfers to the Secretary marketable 

title to the dwelling, (ii) moves from the dwelling within 

the period established or approved by the Secretary, and 

(iii) agrees that any amounts the family is required to pay 

to reimburse the escrow account under section 23(d)(3) 

may be deducted by the public housing agency from the assistance payment otherwise payable on behalf of the family. 

(B) OTHER MORTGAGES.—If a family receiving assistance 

under this subsection defaults under a mortgage not insured under the National Housing Act, the family may not 

continue to receive rental assistance under this section unless it complies with requirements established by the Secretary. 

(C) ALL MORTGAGES.—A family receiving assistance 

under this subsection that defaults under a mortgage may 

not receive assistance under this subsection for occupancy 

of another dwelling owned by one or more members of the 

family. 

(7) DOWNPAYMENT ASSISTANCE.— 

(A) AUTHORITY.—A public housing agency may, in lieu of 

providing monthly assistance payments under this subsection on behalf of a family eligible for such assistance 

and at the discretion of the public housing agency, provide 

assistance for the family in the form of a single grant to 

be used only as a contribution toward the downpayment 

required in connection with the purchase of a dwelling for 

fiscal year 2000 and each fiscal year thereafter to the extent provided in advance in appropriations Acts. 

(B) AMOUNT.—The amount of a downpayment grant on 

behalf of an assisted family may not exceed the amount 

that is equal to the sum of the assistance payments that 

would be made during the first year of assistance on behalf 

50 

of the family, based upon the income of the family at the 

time the grant is to be made. 

(8) DEFINITION OF FIRST-TIME HOMEOWNER.—For purposes of 

this subsection, the term ‘‘first-time homeowner’’ means— 

(A) a family, no member of which has had a present 

ownership interest in a principal residence during the 3 

years preceding the date on which the family initially receives assistance for homeownership under this subsection; 

and 

(B) any other family, as the Secretary may prescribe. 

(z) TERMINATION OF SECTION 8 CONTRACTS AND REUSE OF RECAPTURED BUDGET AUTHORITY.— 

(1) GENERAL AUTHORITY.—The Secretary may reuse any 

budget authority, in whole or part, that is recaptured on account of expiration or termination of a housing assistance payments contract only for one or more of the following: 

(A) TENANT-BASED ASSISTANCE.—Pursuant to a contract 

with a public housing agency, to provide tenant-based assistance under this section to families occupying units formerly assisted under the terminated contract. 

(B) PROJECT-BASED ASSISTANCE.—Pursuant to a contract 

with an owner, to attach assistance to one or more structures under this section, for relocation of families occupying units formerly assisted under the terminated contract. 

(2) FAMILIES OCCUPYING UNITS FORMERLY ASSISTED UNDER

TERMINATED CONTRACT.—Pursuant to paragraph (1), the Secretary shall first make available tenant- or project-based assistance to families occupying units formerly assisted under 

the terminated contract. The Secretary shall provide projectbased assistance in instances only where the use of tenantbased assistance is determined to be infeasible by the Secretary. 

(aa) REFINANCING INCENTIVE.— 

(1) IN GENERAL.—The Secretary may pay all or a part of the 

up front costs of refinancing for each project that— 

(A) is constructed, substantially rehabilitated, or moderately rehabilitated under this section; 

(B) is subject to an assistance contract under this section; and 

(C) was subject to a mortgage that has been refinanced 

under section 223(a)(7) or section 223(f) of the National 

Housing Act to lower the periodic debt service payments of 

the owner. 

(2) SHARE FROM REDUCED ASSISTANCE PAYMENTS.—The Secretary may pay the up front cost of refinancing only— 

(A) to the extent that funds accrue to the Secretary from 

the reduced assistance payments that results from the refinancing; and 

(B) after the application of amounts in accordance with 

section 1012 of the Stewart B. McKinney Homeless Assistance Amendments Act of 1988. 

(bb) TRANSFER, REUSE, AND RESCISSION OF BUDGET AUTHORITY.— 

51 

(1) TRANSFER OF BUDGET AUTHORITY.—If an assistance contract under this section, other than a contract for tenant-based 

assistance, is terminated or is not renewed, or if the contract 

expires, the Secretary shall, in order to provide continued assistance to eligible families, including eligible families receiving the benefit of the project-based assistance at the time of 

the termination, transfer any budget authority remaining in 

the contract to another contract. The transfer shall be under 

such terms as the Secretary may prescribe. 

(2) REUSE AND RESCISSION OF CERTAIN RECAPTURED BUDGET

AUTHORITY.—Notwithstanding paragraph (1), if a project-based 

assistance contract for an eligible multifamily housing project 

subject to actions authorized under title I is terminated or 

amended as part of restructuring under section 517 of the Multifamily Assisted Housing Reform and Affordability Act of 

1997, the Secretary shall recapture the budget authority not 

required for the terminated or amended contract and use such 

amounts as are necessary to provide housing assistance for the 

same number of families covered by such contract for the remaining term of such contract, under a contract providing for 

project-based or tenant-based assistance. The amount of budget 

authority saved as a result of the shift to project-based or tenant-based assistance shall be rescinded. 

(cc) LAW ENFORCEMENT AND SECURITY PERSONNEL.— 

(1) IN GENERAL.—Notwithstanding any other provision of 

this Act, in the case of assistance attached to a structure, for 

the purpose of increasing security for the residents of a project, 

an owner may admit, and assistance under this section may be 

provided to, police officers and other security personnel who 

are not otherwise eligible for assistance under the Act. 

(2) RENT REQUIREMENTS.—With respect to any assistance 

provided by an owner under this subsection, the Secretary 

may— 

(A) permit the owner to establish such rent requirements and other terms and conditions of occupancy that 

the Secretary considers to be appropriate; and 

(B) require the owner to submit an application for those 

rent requirements, which application shall include such information as the Secretary, in the discretion of the Secretary, determines to be necessary. 

(3) APPLICABILITY.—This subsection shall apply to fiscal year 

1999 and fiscal years thereafter. 

(dd) TENANT-BASED CONTRACT RENEWALS.—Subject to amounts 

provided in appropriation Acts, starting in fiscal year 1999, the 

Secretary shall renew all expiring tenant-based annual contribution contracts under this section by applying an inflation factor 

based on local or regional factors to an allocation baseline. The allocation baseline shall be calculated by including, at a minimum, 

amounts sufficient to ensure continued assistance for the actual 

number of families assisted as of October 1, 1997, with appropriate 

upward adjustments for incremental assistance and additional families authorized subsequent to that date. 

* * * * * * * 

(52) 

MINORITY VIEWS 

H.R. 5735 is a well-intentioned yet harmful bill that would attempt to provide assistance to individuals struggling with substance abuse at the expense of other needy persons, such as women 

fleeing domestic violence, persons experiencing homelessness, and 

others in need of housing assistance. 

Democrats agree that Federal resources are needed to house people with substance use disorders so that these individuals can more 

successfully recover and rebuild their lives. However, rather than 

providing increased resources for new vouchers, this bill would take 

a portion of existing Housing Choice Vouchers (HCVs) away from 

families who have been waiting in line for years to get a voucher, 

and redirect them to people with substance use disorders. The effect of this bill could be the permanent redistribution of vouchers 

from some communities to those with high concentrations of individuals with substance use disorders. H.R. 5735 would effectively 

allow one group of people to cut the line in front of families—including those with young children—elderly households, persons 

with disabilities, veterans, victims of domestic abuse, and others 

who are equally deserving and in dire need of housing assistance. 

Further, this bill would create several administrative concerns by 

not only taking HCVs away from public housing agencies (PHAs), 

but also by distributing them to non-profits that would not necessarily have any experience with the HCV program. Once the fiveyear demonstration concludes, it is entirely unclear how the HCVs 

would be redistributed to the PHAs, if at all, potentially resulting 

in the loss of substantial numbers of vouchers from entire communities. The Department of Housing and Urban Development’s 

(HUD’s) capacity to adequately and effectively administer this demonstration is also questionable as HUD does not necessarily have 

expertise in the best practices for substance use disorder treatments, and there is nothing in this bill requiring or encouraging coordination with other agencies, such as the Department of Health 

and Human Services, that do have such expertise. 

Lastly, this bill would place arbitrary time limits of up to two 

years on the individuals that receive vouchers through this new 

demonstration, which may not be enough time for individuals to 

fully recover from their substance use disorder, let alone obtain employment that will allow them to afford market rent. For this reason, existing supportive housing programs that focus on substance 

use disorder treatment generally do not impose time limits in order 

to ensure that individuals are able to fully recover, and are not 

subject to an eviction, which could trigger a relapse. Moreover, 

placing any time limits on housing assistance for anyone, regardless of their substance use, is cruel and allowing for time limits in 

this context opens the door for time limits on other persons or in 

other housing programs. 

53 

To address the shortcomings with H.R. 5735, Democrats offered 

an amendment to fully fund 10,000 new vouchers and to fix the administrative concerns with the bill. These amendments were not 

adopted. In addition, Democrats offered two amendments that were 

not adopted to: (1) ensure that eligible non-profits would not discriminate against individuals, including employees and voucher recipients, on the basic of their sexual orientation or gender identity 

and expression; and (2) help prevent individuals with substance 

abuse disorders from being evicted from public housing units as a 

result of a minor drug related offense. 

In sum, despite the laudable goal of helping house people with 

substance use disorders, H.R. 5735 would provide such assistance 

at the expense of others in need, and would do so in a way that 

would be administratively complicated and counterproductive towards the goal of recovery. For these reasons, we oppose H.R. 5735. 

MAXINE WATERS. 

NYDIA M. VELA ́ ZQUEZ. 

WM. LACY CLAY. 

CAROLYN B. MALONEY. 

STEPHEN F. LYNCH. 

MICHAEL E. CAPUANO. 

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